Page 1
                                                           Page 1 of 201 Pages



                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D. C. 20549
                                    FORM 10-Q

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

                 For Quarterly Period Ended September 30, 2002

                                       OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For Transition Period from _______________ to ____________________

Commission File Number 1-12658

                              ALBEMARLE CORPORATION
                              ---------------------
             (Exact name of registrant as specified in its charter)

          VIRGINIA                                          54-1692118
--------------------------------                       -------------------
State  or other  jurisdiction of                        (I.R.S.  Employer
incorporation or organization)                         Identification No.)


330 SOUTH FOURTH STREET
P. O. BOX 1335
RICHMOND, VIRGINIA                                                  23210
----------------------------------------               -----------------------
(Address of principal executive offices)                          (Zip Code)

Registrant's telephone number, including area code - (804) 788-6000

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.

       Yes   X                    No
            ----                     ----
Number of shares of common stock, $.01 par value, outstanding as of October 31,
2002: 41,678,326.


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                              ALBEMARLE CORPORATION

                                    I N D E X

                                                                        Page
                                                                      Number(s)
                                                                      ---------

PART I.   FINANCIAL INFORMATION

 ITEM 1.  Financial Statements

     Consolidated Balance Sheets - September 30, 2002 and
     December 31, 2001                                                 3-4

     Consolidated Statements of Income - Three- and Nine-
     Months Ended September 30, 2002 and 2001                            5

     Consolidated Statements of Comprehensive Income - Three-
     and Nine-Months Ended September 30, 2002 and 2001                   6

     Condensed Consolidated Statements of Cash Flows - Nine Months
     Ended September 30, 2002 and 2001                                   7

     Notes to the Consolidated Financial Statements                   8-16

 ITEM 2.  Management's Discussion and Analysis of Results
          of Operations and Financial Condition and Additional
          Information                                                17-26

 ITEM 3.  Quantitative and Qualitative Disclosures About Market Risk    26

 ITEM 4.  Controls and Procedures                                       26

PART II.  OTHER INFORMATION

 ITEM 1.  Legal Proceedings                                             26

 ITEM 5.  Other Information                                             27

 ITEM 6.  Exhibits and Reports on Form 8-K                              27

SIGNATURES                                                              28

CERTIFICATIONS                                                       29-32

EXHIBIT INDEX                                                           33

 Exhibit 3(ii) By-Laws as Amended                                    34-56

 Exhibit 10.1 Credit Agreement dated September 10, 2002             57-200

 Exhibit 99.  List of Albemarle Corporation Officers                   201




 Page 3


PART I - FINANCIAL INFORMATION
------------------------------

ITEM 1.  Financial Statements
         --------------------


                                        ALBEMARLE CORPORATION AND SUBSIDIARIES
                                              CONSOLIDATED BALANCE SHEETS
                                                (Dollars In Thousands)


                                                                                  
                                                      September 30, 2002        December 31, 2001
                                                      ------------------        -----------------
                                                          (Unaudited)

ASSETS

Current assets:

  Cash and cash equivalents                           $           36,093        $          30,585

  Accounts receivable, less allowance for doubtful
  accounts (2002 - $2,912;  2001 - $4,193)                       187,609                  175,160

  Inventories:

     Finished goods                                              112,040                  114,337

     Raw materials                                                19,311                   19,551

     Stores, supplies and other                                   27,692                   25,773
                                                      ------------------        -----------------
                                                                 159,043                  159,661

Deferred income taxes and prepaid expenses                        21,358                   18,255
                                                      ------------------        -----------------

          Total current assets                                   404,103                  383,661
                                                      ------------------        -----------------

Property, plant and equipment, at cost                         1,473,536                1,425,203

     Less accumulated depreciation and amortization              954,720                  895,531

       Net property, plant and equipment                         518,816                  529,672

Prepaid pension assets                                           137,124                  128,195

Other assets and deferred charges                                 60,877                   56,199

Goodwill                                                          28,927                   26,704

Other intangibles, net of amortization                             5,643                    5,044
                                                      ------------------        -----------------

Total assets                                          $        1,155,490        $       1,129,475
                                                      ==================        =================



                             See accompanying notes to the consolidated financial statements.



 Page 4


                                        ALBEMARLE CORPORATION AND SUBSIDIARIES
                                              CONSOLIDATED BALANCE SHEETS
                                                  (Dollars In Thousands)




                                                                                   
                                                      September 30, 2002        December 31, 2001
                                                      ------------------        -----------------
                                                          (Unaudited)

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:

  Accounts payable                                    $           74,190        $          63,559

  Long-term debt, current portion                                    323                  157,862

  Accrued expenses                                                67,051                   59,978

  Dividends payable                                                5,337                    5,915

  Income taxes payable                                            28,653                   16,523
                                                     -------------------        -----------------

          Total current liabilities                              175,554                  303,837
                                                     -------------------        -----------------

Long-term debt                                                   177,629                   12,353

Other noncurrent liabilities                                     131,586                  120,269

Deferred income taxes                                            115,573                   99,714

Shareholders' equity:

  Common stock, $.01 par value, issued and outstanding-

    41,678,326 in 2002 and 45,498,201 in 2001                        417                      455

  Additional paid-in capital                                       2,160                   51,025

  Accumulated other comprehensive loss                            (7,918)                 (18,453)

  Retained earnings                                              560,489                  560,275
                                                     -------------------        -----------------

          Total shareholders' equity                             555,148                  593,302
                                                     -------------------        -----------------

Total liabilities and shareholders' equity           $         1,155,490        $       1,129,475
                                                     ===================        =================



                            See accompanying notes to the consolidated financial statements.



 Page 5



                                                     ALBEMARLE CORPORATION AND SUBSIDIARIES
                                                       CONSOLIDATED STATEMENTS OF INCOME
                                                     (In Thousands Except Per-Share Amounts)
                                                                     (Unaudited)

                                                   Three Months Ended                      Nine Months Ended
                                                      September 30,                          September 30,
                                            -------------------------------      ----------------------------------
                                                                                                    

                                                2002                2001               2002                 2001
                                            -----------         -----------       ------------          -----------

Net sales                                   $  263,324          $  242,017         $  733,003           $  677,713
Cost of goods sold                             198,350             185,336            554,114              512,841
                                            -----------         -----------        -----------          -----------
    Gross profit                                64,974              56,681            178,889              164,872

Selling, general and administrative
  expenses                                      29,450              25,822             84,070               70,712
Research and development
  expenses                                       4,120               5,603             12,916               16,813
Special item                                         -                   -                850                    -
                                            -----------         -----------        -----------          -----------
     Operating profit                           31,404              25,256             81,053               77,347
                                            -----------         -----------        -----------          -----------

Interest and financing expenses                 (1,315)             (2,013)            (3,775)              (4,168)
Other (expense) income, net                       (841)                975              2,227                3,793
                                            -----------         -----------        -----------          -----------
   Income before income taxes                   29,248              24,218             79,505               76,972
Income taxes                                     8,896               7,457             21,661               22,861
                                            -----------         -----------        -----------          -----------
Net income                                  $   20,352          $   16,761         $   57,844           $   54,111
                                            ===========         ===========        ===========          ===========
Basic earnings per share                    $     0.49          $     0.37         $     1.37           $     1.18
Diluted earnings per share                  $     0.48          $     0.36         $     1.34           $     1.16
                                            ===========         ===========        ===========          ===========
Cash dividends declared per
   share of common stock                    $     0.14          $     0.13         $     0.40           $     0.39
                                            ===========         ===========        ===========          ===========


                                          See accompanying notes to the consolidated financial statements.



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                                                     ALBEMARLE CORPORATION AND SUBSIDIARIES
                                                 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
                                                             (Dollars In Thousands)
                                                                  (Unaudited)

                                                                                             



                                              Three Months Ended                      Nine Months Ended
                                                  September 30,                          September 30,
                                       -------------------------------          -----------------------------
                                          2002                 2001                 2002               2001
                                       ----------          ----------           ----------         ----------
Net income                             $  20,352           $  16,761            $  57,844          $  54,111
Other comprehensive (loss) income,
 net of tax:
   Unrealized (loss) on securities
      available for sale                    (342)               (102)                (439)              (341)
   Foreign currency translation
      adjustments                           (456)              7,307               10,974                806
                                        ----------          ----------          -----------        ----------
Other comprehensive (loss) income,          (798)              7,205               10,535                465
                                        ----------         ----------           -----------        ----------
Comprehensive income                   $  19,554           $  23,966            $  68,379          $  54,576
                                        ==========         ==========           ===========        ==========






                                   See accompanying notes to the consolidated financial statements.



 Page 7


                                  ALBEMARLE CORPORATION AND SUBSIDIARIES
                               CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                           (Dollars In Thousands)
                                                 (Unaudited)

                                                                                  
                                                                           Nine Months Ended
                                                                             September 30,
                                                                     ---------------------------
                                                                          2002           2001
                                                                     -----------     -----------
Cash and cash equivalents at beginning of year                       $   30,585      $   19,300
                                                                     -----------     -----------
Cash flows from operating activities:
   Net income                                                            57,844          54,111
   Adjustments to reconcile net income to cash flows from
    operating activities:
     Depreciation and amortization                                       60,646          55,461
     Working capital decrease (increase) excluding cash
      and cash equivalents                                               21,873          (7,303)
   Increase in prepaid pension assets                                    (8,929)        (13,332)
   Other, net                                                            (3,513)         13,054
                                                                    ------------     -----------
Net cash provided from operating activities                             127,921         101,991
                                                                    ------------     -----------

Cash flows from investing activities:
   Capital expenditures                                                 (27,906)        (37,928)
   Investments in joint ventures and nonmarketable securities            (3,785)         (6,216)
   Acquisition of businesses, net of cash acquired                            -        (113,000)
   Restricted cash from industrial revenue bond proceeds                  1,741               -
   Other, net                                                             3,139             767
                                                                   -------------    ------------
Net cash used in investing activities                                   (26,811)       (156,377)
                                                                   -------------    ------------

Cash flows from financing activities:
   Proceeds from borrowings                                             103,995         122,850
   Repayments of long-term debt                                         (97,426)        (36,211)
   Purchases of common stock                                            (92,943)         (2,202)
   Dividends paid                                                       (17,231)        (18,194)
   Proceeds from exercise of stock options                                2,196             677
                                                                  --------------    ------------
Net cash (used in) provided from financing activities                  (101,409)         66,920
                                                                  --------------    ------------
Net effect of foreign exchange on cash and cash equivalents               5,807           2,388
                                                                  --------------    ------------
Net increase in cash and cash equivalents                                 5,508          14,922
                                                                  --------------    ------------
Cash and cash equivalents at end of period                           $   36,093      $   34,222
                                                                  ==============    ============

                          See accompanying notes to the consolidated financial statements.


 Page 8





                     ALBEMARLE CORPORATION AND SUBSIDIARIES
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                (In Thousands Except Share and Per-Share Amounts)
                                   (Unaudited)

1.   In the  opinion of  management,  the  accompanying  consolidated  financial
     statements of Albemarle  Corporation and Subsidiaries  ("Albemarle" or "the
     Company") contain all adjustments necessary for a fair presentation, in all
     material respects, of the Company's  consolidated  financial position as of
     September  30, 2002,  and December 31, 2001,  the  consolidated  results of
     operations and comprehensive  income for the three- and nine-month  periods
     ended September 30, 2002, and 2001, and condensed  consolidated  cash flows
     for the  nine-month  periods  ended  September  30,  2002,  and  2001.  All
     adjustments  are of a  normal  and  recurring  nature.  These  consolidated
     financial  statements  should be read in conjunction  with the consolidated
     financial  statements  and notes  thereto  included in the  Company's  2001
     Annual Report & Form 10-K as amended on May 31, 2002. The December 31, 2001
     consolidated   balance  sheet  data  was  derived  from  audited  financial
     statements,  but does not include  all  disclosures  required by  generally
     accepted  accounting  principles.  The results of operations for the three-
     and  nine-month  periods  ended  September  30, 2002,  are not  necessarily
     indicative of the results to be expected for the full year. Certain amounts
     in the  accompanying  consolidated  financial  statements and notes thereto
     have  been  reclassified  to  conform  to  current  presentation.   Certain
     revisions  have  been  made  to the  nine-month  pro  forma  amounts  ended
     September  30, 2001 to reflect  final  purchase  price  allocations  of the
     Martinswerk  GmbH and the custom and fine  chemicals  business of ChemFirst
     Inc. acquisitions.

2.   Long-term debt consists of the following:

                                          September 30,            December 31,
                                               2002                    2001
                                          -------------          --------------
     Variable-rate bank loans              $   158,225           $    144,600
     Foreign borrowings                          7,732                 13,584
     Industrial revenue bonds                   11,000                 11,000
     Miscellaneous                                 995                  1,031
                                          -------------          --------------
        Total                                  177,952                170,215
                                          -------------          --------------
     Less amounts due within one year              323                157,862
                                          -------------          --------------
        Long-term debt                    $    177,629           $     12,353
                                          =============          ==============


     On September 10, 2002, the Company entered into a new three-year  unsecured
     Credit  Agreement  with a group of lenders  providing  for $375  million in
     revolving  credit  facilities.  Borrowing  under  the  credit  facility  is
     conditioned upon compliance with financial and other covenants set forth in
     the related agreement,  including  covenants relating to leverage (measured
     as the ratio of debt and interest to adjusted  earnings).  We currently are
     in compliance with all such  covenants.  An increase in pricing level based
     on the Company's  debt to  capitalization  ratio would not  accelerate  the
     maturity of our indebtedness  thereunder.  However, an increase in our debt
     to capitalization ratio would result in an increase in the


 Page 9

                     ALBEMARLE CORPORATION AND SUBSIDIARIES
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                (In Thousands Except Share and Per-Share Amounts)
                                   (Unaudited)

     interest  rate and fees payable  under the credit  facility.  The Company's
     former credit facility was to mature on September 29, 2002,  which required
     the  short-term  debt amount of $157,862 for the period ended  December 31,
     2001, to be included in current liabilities.

3.   Cost of goods sold included  foreign  exchange gains of $548 and $1,622 for
     the three- and nine-month  periods ended September 30, 2002,  respectively.
     Cost of goods sold for the three- and  nine-month  periods ended  September
     30, 2001, included foreign exchange gains of $976 and $389, respectively.

4.   Basic and diluted earnings per share for the three- and nine-month  periods
     ended September 30, 2002 and 2001, are calculated as follows:


                                     Three Months Ended       Nine Months Ended
                                         September 30,           September 30,
                                    -------------------       ------------------

Basic earnings per share              2002         2001         2002       2001
------------------------            --------     --------     -------   --------
Numerator:
  Income available to shareholders,
    as reported                     $ 20,352     $ 16,761    $ 57,844   $ 54,111
                                    --------     --------    --------   --------

Denominator:
  Average number of shares of
    common stock outstanding          41,676       45,870      42,244     45,860
                                    --------     --------    --------   --------

  Basic earnings per share          $   0.49     $   0.37     $  1.37   $   1.18
                                    ========     ========     =======   ========

Diluted earnings per share
--------------------------
Numerator:
  Income available to shareholders,
    as reported                     $ 20,352     $ 16,761    $ 57,844   $ 54,111
                                    --------     --------    --------   --------
Denominator:
  Average number of shares of
    common stock outstanding          41,676       45,870      42,244     45,860

  Shares issuable upon
    exercise of stock options          1,120          669       1,026        771
                                    --------     --------     -------   --------

          Total shares                42,796        46,539     43,270     46,631
                                    --------      --------   --------   --------

  Diluted earnings per share        $   0.48      $   0.36   $   1.34   $   1.16
                                    ========      ========   ========   ========


 Page 10


                     ALBEMARLE CORPORATION AND SUBSIDIARIES
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                (In Thousands Except Share and Per-Share Amounts)
                                   (Unaudited)

5.   The significant  differences  between the U.S. Federal statutory income tax
     rate on pretax income and the effective  income tax rate for the three- and
     nine-month periods ended September 30, 2002 and 2001, respectively,  are as
     follows:



                                                     % of Income Before Income Taxes
                                                                        
                                         -----------------------------------------------------
                                              Three Months Ended           Nine Months Ended
                                                 September 30,               September 30,
                                         -------------------------    ------------------------
                                             2002          2001           2002         2001
                                         ----------    ----------     ------------   ---------
Federal statutory rate                        35.0%       35.0%           35.0%         35.0%
Extraterritorial income tax benefit           (2.9)       (0.2)           (1.7)         (1.8)
State taxes, net of federal tax benefit        1.0         1.2             1.0           1.1
Depletion                                     (1.5)       (2.1)           (2.6)         (1.8)
Reversal of valuation allowance                  -           -              -           (1.4)
Other, net                                    (1.2)       (3.1)           (1.4)         (1.4)
                                          ----------   ----------     -----------    ---------
Effective income tax rate on operations       30.4        30.8            30.3          29.7

Federal income tax settlement                    -           -            (3.1)            -
                                          -----------  ----------     -----------    ---------
Effective income tax rate                     30.4%       30.8%           27.2%         29.7%
                                          ===========  ==========     ===========    =========




     On April 25, 2002,  following approval by the Congressional Joint Committee
     on  Taxation,  the  Company  received a  settlement  of  $3,777,  including
     interest of $2,017  ($1,285 after income  taxes) from the Internal  Revenue
     Service on its claims for adjustment of export  benefits for the years 1994
     and 1995. This interest is included in other (expense)  income,  net in the
     consolidated statements of income. Consequently, the effective tax rate for
     the third  quarter  and  first  nine  months  of 2002 was 30.4% and  27.2%,
     respectively.  The Company expects to maintain its targeted income tax rate
     of 30% for  the  last  half of 2002  and a  blended  rate  for the  year of
     approximately 28%.

     During  the  first  quarter  of 2001,  the  Company  released  a  valuation
     allowance  that had been  required on a deferred  tax asset  related to the
     Company's facilities in Louvain-la-Neuve, Belgium, which was established in
     1996 when the Company's Olefins Business was sold.

6.   On May 31, 2001,  the Company  acquired  Martinswerk  GmbH and certain U.S.
     working  capital for  approximately  $34,000 in cash plus  expenses and the
     assumption of approximately  $63,000 in current and long-term  liabilities.
     The assets acquired  included  Martinswerk's  manufacturing  facilities and
     headquarters  in  Bergheim,  Germany and its  50-percent  stake in Magnifin
     Magnesiaprodukte  GmbH,  which has  manufacturing  facilities at St. Jakobs
     Breitenau,  Austria.  The  acquisition  was financed  through the Company's
     previous  Revolving Credit

 Page 11

                     ALBEMARLE CORPORATION AND SUBSIDIARIES
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                (In Thousands Except Share and Per-Share Amounts)
                                   (Unaudited)

     Agreement.  The  acquisition  was accounted  for by the purchase  method of
     accounting,  and accordingly,  the operating  results have been included in
     the  Company's   consolidated  results  of  operations  from  the  date  of
     acquisition.  See pro forma  financial  information  presented  below.  The
     purchase price  allocation was finalized  during the quarter ended June 30,
     2002.  Martinswerk produces mineral-based flame retardants for the plastics
     and  rubber   markets,   brightening   pigments  for   high-quality   paper
     applications  and specialty  aluminum  oxides for  polishing,  catalyst and
     niche  ceramic   applications.   Magnifin  produces  high-purity  magnesium
     hydroxide flame retardant  products used in applications  requiring  higher
     processing temperatures.

     On July 1,  2001,  the  Company  acquired  the  custom  and fine  chemicals
     businesses of ChemFirst Inc. for  approximately  $79,000 in cash,  plus the
     assumption of certain current  liabilities and expenses associated with the
     acquisition.  The acquisition was financed  through the Company's  previous
     Revolving  Credit  Agreement.  The Asset  Purchase  Agreement  provided for
     additional  contingent  payments to ChemFirst Inc. which are dependant upon
     the contribution  margin of certain products and are not expected to exceed
     $10,000. Additional payments totaling $1,138 have been added to goodwill in
     2002.  The  acquisition  was  accounted  for  by  the  purchase  method  of
     accounting,  and accordingly,  the operating  results have been included in
     the  Company's   consolidated  results  of  operations  from  the  date  of
     acquisition.  See pro forma  financial  information  presented  below.  The
     assets acquired included working capital, property, plant and equipment and
     certain  intangibles,  including  goodwill  and  technical  know  how.  The
     purchase  price  allocation  was finalized  during the second quarter ended
     June 30, 2002.  The new  businesses  acquired  focus on the  manufacture of
     custom  and  proprietary  fine  chemicals  and  chemical  services  for the
     pharmaceutical  and life sciences  industries.  They also include additives
     for  ultraviolet  light-cured  polymer  coatings,  which should broaden the
     portfolio  of  Albemarle's  polymer  chemicals  business.   Included  is  a
     multi-functional  manufacturing plant in Tyrone,  Pennsylvania,  and a cGMP
     (current Good Manufacturing Practices) pilot plant in Dayton, Ohio.

     Pro forma  information  is presented as follows for the  nine-month  period
     ended  September  30,  2001,  as  if  Martinswerk  GmbH  and  Martinswerk's
     50-percent stake in Magnifin Magnesiaprodukte GmbH, and the custom and fine
     chemicals  businesses  of ChemFirst  Inc.  had been  acquired on January 1,
     2001.

                                           Nine Months Ended
                                           September 30, 2001
                                          --------------------
          Net sales                               $748,212

          Net income                              $ 56,342

          Basic earnings per share                $   1.23

          Diluted earnings per share              $   1.21


 Page 12

                     ALBEMARLE CORPORATION AND SUBSIDIARIES
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                (In Thousands Except Share and Per-Share Amounts)
                                   (Unaudited)

     The pro forma information  presented above primarily  includes  adjustments
     for interest expense, depreciation expense and amortization of intangibles.

7.   On February  13,  2002,  the Company  completed  the  purchase of 4,000,000
     shares of its common stock from Bruce C. Gottwald and his related immediate
     family  interests  for an  aggregate  price of $92,680.  At that time,  the
     Company retired the shares and reduced  retained  earnings by $40,979 after
     eliminating  the  balance  in  additional  paid-in  capital. The  Company's
     purchase  price  was 25 cents  per share  less  than the  weighted  average
     trading price from New York Stock Exchange transactions in Albemarle common
     stock during the 10 business days' period beginning with the third business
     day following the announcement of Albemarle's 2001 year-end earnings.

8.   During the first  quarter of 2002,  the  Company  continued  its efforts to
     reduce  operating  costs  through an  involuntary  separation  program that
     resulted in a special charge of $850 ($541 after income taxes or 1 cent per
     share on a diluted  basis).  The  program  impacted a total of 12  salaried
     employees  throughout the Company. The following table summarizes the total
     special charges assumed related to the involuntary separation program:

                                                       Nine Months Ended
                                                      September 30, 2002
                                                     --------------------
       Total 2002 workforce reduction charge                      $1,114

             Less: over accrual from
               prior year accruals                                   264
                                                     --------------------
       Net workforce reductions charged for 2002                    $850
                                                     ====================



     Approximately  $36 of the total 2002 workforce accrual charge was unpaid at
     September 30, 2002. In addition, essentially all of the fourth quarter 2001
     work force accrual was paid during the first quarter of 2002.

9.   During the nine months ended September 30, 2002, the Company recorded a net
     charge  of  $2,750  ($1,752  after  income  taxes or 4 cents per share on a
     diluted  basis) to cost of sales  that  related  to the  discontinuance  of
     product support for and the withdrawal from a water treatment venture.  The
     Company's balance sheet at September 30, 2002,  included entries reflecting
     the accrual of a probable  insurance  recovery of  approximately  $4,000 in
     other  assets and accruals  totaling  $276 in current  liabilities,  net of
     payments made to date.

 Page 13

                     ALBEMARLE CORPORATION AND SUBSIDIARIES
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                (In Thousands Except Share and Per-Share Amounts)
                                   (Unaudited)

10.  The Company has recorded  environmental  liabilities of $31,091 and $30,245
     at September 30, 2002 and December 31, 2001, respectively,  which represent
     management's  best estimate of the Company's  future  remediation and other
     anticipated  environmental  costs relating to past operations.  The Company
     believes that such estimates are reasonable based on available  information
     and that the  liabilities and related loss  contingencies  and the expected
     outcome of  uncertainties  have been adequately  described in the Company's
     consolidated  financial  statements  at December 31,  2001.  Although it is
     difficult to quantify the potential  financial  impact of  compliance  with
     environmental  protection laws, management  estimates,  based on the latest
     available  information,  that there is a reasonable possibility that future
     environmental   remediation   costs  associated  with  the  Company's  past
     operations,  in  excess  of  amounts  already  recorded,  could  be  up  to
     approximately  $9,500 before income taxes,  to be incurred over a period of
     time. However,  the Company believes that any sum it may be required to pay
     in  connection  with  environmental  remediation  matters  in excess of the
     amounts  recorded  should occur over a period of time and should not have a
     material   adverse  impact  on  its  financial   condition  or  results  of
     operations,  but could  have a  material  adverse  impact  in a  particular
     quarterly reporting period.

11.  The  Company  is a  global  manufacturer  of  specialty  polymer  and  fine
     chemicals, currently grouped into two operating segments: Polymer Chemicals
     and  Fine  Chemicals.  The  operating  segments  were  determined  based on
     management  responsibility.  The Polymer  Chemicals segment is comprised of
     flame retardants,  organometallics and catalysts, and polymer additives and
     intermediates.  The  Fine  Chemicals  operating  segment  is  comprised  of
     agrichemicals and pharmachemicals, performance chemicals and fine chemistry
     services.  Segment data includes intersegment transfers of raw materials at
     cost and  foreign  exchange  gains and  losses as well as  allocations  for
     certain  corporate  costs. The corporate and other expenses include certain
     corporate-related items not allocated to the reportable segments.

 Page 14


                     ALBEMARLE CORPORATION AND SUBSIDIARIES
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                (In Thousands Except Share and Per-Share Amounts)
                                   (Unaudited)


                                                                        

                                                 Three Months Ended September 30,
                                         ------------------------------------------------
                                                  2002                       2001
                                         ------------------------------------------------
Summary of Segment Results                Revenues    Income         Revenues    Income
                                         ---------   ---------      ---------    --------
Polymer Chemicals                       $  145,503  $   21,262     $  117,558   $  14,217
Fine Chemicals                             117,821      17,622        124,459      18,065
                                         ---------   ---------      ---------    --------
   Segment totals                       $  263,324      38,884     $  242,017      32,282
                                         =========                  =========
Corporate and other expenses                            (7,480)                    (7,026)
                                                     ----------                  ---------
   Operating Profit                                     31,404                     25,256

Interest and financing expenses                         (1,315)                    (2,013)
Other income, net                                         (841)                       975
                                                     ----------                  ---------
Income before income taxes                          $   29,248                  $  24,218
                                                     ==========                  =========



                                                                      


                                                 Nine Months Ended September 30,
                                        -------------------------------------------------
                                                 2002                       2001
                                         ------------------------------------------------
Summary of Segment Results                Revenues    Income         Revenues    Income
                                         ---------     --------     ---------    --------
Polymer Chemicals                       $  398,070    $  52,019    $  347,430   $  50,363
Fine Chemicals                             334,933       46,314       330,283      42,155
                                         ---------     --------     ---------    --------
   Segment totals                       $  733,003       98,333    $  677,713      92,518
                                         =========                  =========
Corporate and other expenses                            (17,280)                  (15,171)
                                                       ---------                 ---------
   Operating profit                                      81,053                    77,347

Interest and financing expenses                          (3,775)                   (4,168)
Other income, net                                         2,227                     3,793
                                                       ---------                 ---------
Income before income taxes                           $   79,505                 $   76,972
                                                      ==========                 =========



12.  During July 2001, the Financial  Accounting Standards Board ("FASB") issued
     Statement of Financial  Accounting Standard ("SFAS") No. 142, "Goodwill and
     Other  Intangible  Assets." SFAS No. 142  eliminates  the  amortization  of
     goodwill and instead requires a periodic review of any goodwill balance for
     possible impairment.  SFAS No. 142 also requires that goodwill be allocated
     at the  reporting  unit  level.  This  statement  was  effective  for years
     beginning  after  December  15,  2001,  with the  exception of goodwill and
     intangible  assets  acquired  after  June  30,  2001,  which  were  subject
     immediately  to the  nonamortization  and  amortization  provisions  of the
     statement.  For  financial  reporting  purposes,  the Company  discontinued
     amortization  of  goodwill  as of January 1, 2002,  with the  exception  of
     goodwill  associated with the July 2001  acquisition of the custom and fine
     chemicals  businesses  of  ChemFirst  Inc.,  for  which  amortization,   in
     accordance with SFAS No. 142, never began.

 Page 15

                     ALBEMARLE CORPORATION AND SUBSIDIARIES
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                (In Thousands Except Share and Per-Share Amounts)
                                   (Unaudited)

     The Company has completed its transitional  goodwill impairment testing and
     has  determined  that  goodwill  is not  impaired  at January 1, 2002.  The
     following  schedule  presents  net  income,  basic  earnings  per share and
     diluted  earnings per share,  exclusive of goodwill  amortization  expense,
     including any related tax effects,  for all periods  presented in which the
     standard had not been adopted.



                                                                            

                                                 Three Months                  Nine Months
                                                     Ended                        Ended
                                              September 30, 2001           September 30, 2001
                                             --------------------         --------------------

Reported net income                                      $16,761                      $54,111
Add back: goodwill amortization, net of tax                  332                          871
                                            ---------------------         --------------------

Adjusted net income                                      $17,093                      $54,982
                                            =====================         ====================

Basic earnings per share:
   Reported net income                                     $0.37                        $1.18
   Goodwill amortization, net of tax                        0.01                         0.02
                                            ---------------------         --------------------

   Adjusted net income                                     $0.38                        $1.20
                                            =====================         ====================

Diluted earnings per share:
   Reported net income                                     $0.36                        $1.16
   Goodwill amortization, net of tax                        0.01                         0.02
                                            ---------------------         --------------------

   Adjusted net income                                     $0.37                        $1.18
                                            =====================         ====================



     During  October  2001,  the FASB issued SFAS No. 144,  "Accounting  for the
     Impairment or Disposal of Long-Lived  Assets,"  which  addresses  financial
     accounting  and  reporting  for the  impairment  or disposal of  long-lived
     assets. The Company adopted SFAS No. 144 on January 1, 2002. This Statement
     has not had an impact on the Company's financial statements as of September
     30, 2002.

     During  April  2002,  the FASB issued  SFAS No.  145,  "Rescission  of FASB
     Statements Number 4, 44, and 64, Amendment of FASB Statement Number 13, and
     Technical  Corrections."  The  provisions  of this  statement are generally
     effective  for  fiscal  years  beginning  after  May 15,  2002  and are not
     expected to have a material impact on the Company's financial statements.


 Page 16



                     ALBEMARLE CORPORATION AND SUBSIDIARIES
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                (In Thousands Except Share and Per-Share Amounts)
                                   (Unaudited)

     On July 30,  2002,  the FASB  issued SFAS No.  146,  "Accounting  for Costs
     Associated with Exit or Disposal  Activities,"  which  addresses  financial
     accounting  and  reporting  for  costs  associated  with  exit or  disposal
     activities and nullifies  Emerging Issues Task Force (EITF) Issue No. 94-3,
     "Liability  Recognition for Certain Employee Termination Benefits and Other
     Costs  to Exit an  Activity."  This  Statement  is  effective  for  exit or
     disposal  activities  initiated after December 31, 2002 and is not expected
     to have a material impact on the Company's financial statements.



 Page 17


ITEM 2.      Management's Discussion and Analysis of Results of Operations and
             -----------------------------------------------------------------
             Financial Condition and Additional Information
             ----------------------------------------------

     The  following  is   management's   discussion   and  analysis  of  certain
     significant  factors  affecting  the  results of  operations  of  Albemarle
     Corporation  ("Albemarle" or "the Company")  during the periods included in
     the  accompanying  consolidated  statements  of income  and  changes in the
     Company's financial condition since December 31, 2001.

     Some  of  the  information   presented  in  the  following  discussion  may
     constitute  forward-looking  comments  within the  meaning  of the  Private
     Securities Litigation Reform Act of 1995. Although the Company believes its
     expectations are based on reasonable  assumptions  within the bounds of its
     knowledge of its business and  operations,  there can be no assurance  that
     actual results will not differ  materially from its  expectations.  Factors
     that could  cause  actual  results  to differ  from  expectations  include,
     without limitation,  the timing of orders received from customers, the gain
     or loss of significant  customers,  competition  from other  manufacturers,
     changes in the demand for the Company's products,  increases in the cost of
     the  products,  changes in the market in general,  fluctuations  in foreign
     currencies and significant changes in new product introduction resulting in
     an increase in capital project requests and approvals leading to additional
     capital spending.

     Results of Operations
     ---------------------
     Third Quarter 2002 Compared with Third Quarter 2001
     ---------------------------------------------------

     Net sales for third  quarter  2002 of $263.3  million were a record for the
     Company since the sale of the olefins  businesses in March 1996, up 8.8% or
     $21.3  million  from third  quarter 2001 net sales of $242.0  million.  The
     increase  in net sales was  primarily  due to  higher  shipments  partially
     offset by lower  pricing  in both  flame  retardants  ($15.8  million)  and
     performance  chemicals  ($1.4 million),  higher  shipments in catalysts and
     additives ($8.4 million) and the favorable impact of foreign exchange ($7.1
     million)  offset,  in part, by lower  shipments in  agrichemicals  and fine
     chemistry services ($11.6 million).

     The gross profit margin increased to 24.7% in third quarter 2002 from 23.4%
     for the  corresponding  period in 2001. Third quarter 2002 operating profit
     was up 24.3% or $6.1  million  from third  quarter  2001  operating  profit
     primarily due to higher shipments in flame retardants  offset,  in part, by
     lower pricing, and reduced raw material and manufacturing fixed costs.

     Selling,  general and  administrative  ("SG&A")expenses  and  research  and
     development  ("R&D")  expenses  increased 6.8% or $2.1 million in the third
     quarter  of  2002  versus  third  quarter  2001,  primarily  due to  higher
     employee- related costs in the current period versus the corresponding 2001
     period.  As a percentage of net sales,  SG&A expenses and R&D expenses were
     12.7% in 2002 versus 13.0% in the 2001 quarter.


 Page 18


     Operating Segments

     Net sales by reportable  business  operating  segment for the third quarter
     periods ended September 30, 2002 and 2001 are as follows:

                                                Net Sales
                                              (In Thousands)
                                    --------------------------------------

                                          2002                  2001
                                    -----------------     -----------------

     Polymer Chemicals                  $145,503              $117,558
     Fine Chemicals                      117,821               124,459
                                    -----------------     -----------------
     Segment totals                     $263,324              $242,017
                                    =================     =================

     Polymer  Chemicals'  net sales for third quarter 2002 increased  23.8%,  or
     $27.9 million,  from third quarter 2001 net sales,  primarily due to higher
     shipments  in  flame  retardants  partly  offset  by lower  pricing  ($15.8
     million),  higher  shipments in catalysts and additives  ($8.4 million) and
     the favorable impact of foreign exchange ($3.7 million).

     Fine  Chemicals'  net sales for third quarter 2002  decreased  5.3% or $6.6
     million from third quarter 2001,  primarily due to lower  shipments in both
     agrichemicals and fine chemistry  services ($11.6 million) offset, in part,
     by higher shipments in performance chemicals partly offset by lower pricing
     ($1.4 million) and the favorable impact of foreign exchange ($3.4 million).

     Operating  profit by reportable  business  operating  segment for the third
     quarter periods ended September 30, 2002, and 2001 are as follows:

                                                Operating Profit
                                                 (In Thousands)
                                                -----------------
                                                 2002       2001
                                                -------   -------
     Polymer Chemicals                          $21,262   $14,217
     Fine Chemicals                              17,622    18,065
                                                -------   -------
     Segment totals                              38,884    32,282
     Corporate and other expenses                (7,480)   (7,026)
                                                -------   -------

     Operating profit                           $31,404   $25,256
                                                ========  ========

     Polymer Chemicals' third quarter 2002 segment operating profit was up 49.6%
     or $7.0 million from third quarter 2001  primarily due to higher  shipments
     ($8.2 million),  lower  manufacturing  costs ($2.8 million),  favorable raw
     material  costs ($1.9  million)  and the  favorable  net effects of foreign
     exchange ($0.8 million) offset, in part, by lower pricing ($6.7 million).

     Fine Chemicals' third quarter 2002 segment  operating profit decreased 2.5%
     or $0.4 million  from third  quarter 2001  primarily  due to lower  pricing
     ($4.2 million) and shipments ($1.9 million)  offset,  in part, by favorable
     raw material costs ($2.8 million,  plant  utilization and production  costs
     ($2.5  million),  and the favorable net effects of foreign  exchange  ($0.4
     million).

     Corporate and other expenses for the third quarter of 2002 were up 6.5%, or
     $0.5 million from third  quarter  2001,  primarily  due to higher  employee
     related costs in the 2002 period.

 Page 19


     Interest and Financing Expenses

     Interest and  financing  expenses for third  quarter  2002  decreased  $0.7
     million  from $2.0  million  in third  quarter  2001 due to lower  interest
     rates, offset, in part, by higher average outstanding debt in third quarter
     2002.

     Other (Expense) Income, Net

     Other (expense)  income,  net for the third quarter 2002 amounted to $(0.8)
     million  expense,  a net change of $1.8  million from $1.0 million in other
     income,  net for the  corresponding  period  in 2001.  Third  quarter  2002
     reflects the writedown of a minority  interest in a joint venture amounting
     to $1.0 million and the writeoff of an investment in ACTA Technology,  Inc.
     totaling $.5 million.

     Income Taxes

     The third quarter 2002 effective income tax rate was 30.4%, down from 30.8%
     for the corresponding period in 2001.


     Results of Operations
     ---------------------
     Nine Months 2002 Compared with Nine Months 2001
     -----------------------------------------------

     Net sales for the first nine months of 2002 amounted to $733.0 million,  up
     8.2%  or  $55.3   million  from  net  sales  of  $677.7   million  for  the
     corresponding  period of 2001.  The  increase  in net  sales was  primarily
     attributable  to $63.4  million  in net sales in the 2002  period  from the
     mid-year  2001  acquisitions  of  Martinswerk  GmbH and the custom and fine
     chemicals  businesses  of  ChemFirst  Inc.,  and  higher  shipments  ($34.1
     million)  partially  offset  by  lower  prices  ($15.9  million)  in  flame
     retardants,   offset,   in  part,   by  lower   pricing  and  shipments  of
     agrichemicals  and fine chemistry  services ($18.0 million) and product mix
     in performance chemicals ($9.2 million).

     The gross profit margin was 24.4% for the first nine months of 2002,  which
     was relatively constant with the 24.3% margin for the corresponding  period
     in 2001. The first nine months of 2002 operating profit was up 4.8% or $3.7
     million  from the 2001  period.  The first nine  months of 2002  includes a
     charge of  approximately  $2.8  million  ($6.8  million,  net of a probable
     insurance  recovery  of  $4.0  million)  to cost of  sales  related  to the
     discontinuance  of  product  support  for and the  withdrawal  from a water
     treatment venture as well as a $0.9 million charge for workforce reductions
     as the Company continues to aggressively pursue its cost reduction efforts.
     Favorable plant utilization and production costs in performance  chemicals,
     pharmachemicals  and flame  retardants  and  favorable  raw material  costs
     offset lower pricing in flame retardants for the nine months of 2002 versus
     the corresponding 2001 period.

     SG&A expenses and R&D expenses increased 10.8% or $9.5 million in the first
     nine months of 2002 versus the 2001 period,  primarily due to costs related
     to the  businesses  acquired  in  2001 of $4.7  million  as well as  higher
     employee-related costs in the current period. As a percentage of net sales,
     SG&A  expenses  and R&D  expenses  were 13.2% in the first nine months 2002
     versus 12.9% in the corresponding period of 2001.

 Page 20

     Operating Segments

     Net sales by  reportable  business  operating  segment for the  nine-months
     periods ended September 30, 2002 and 2001 are as follows:

                                                   Net Sales
                                                 (In Thousands)
                                        ------------------------------
                                             2002               2001
                                        ------------       -----------
     Polymer Chemicals                      $398,070          $347,430
     Fine Chemicals                          334,933           330,283
                                        ------------       -----------
     Segment totals                         $733,003          $677,713
                                        ============       ===========

     Polymer  Chemicals'  net sales for the first nine months of 2002  increased
     14.6% or $50.6 million from the corresponding  period in 2001 primarily due
     to the increase in net sales of $29.7  million  resulting  from the May 31,
     2001,  acquisition of Martinswerk GmbH and higher shipments ($34.1 million)
     in flame  retardants  partially offset by lower pricing ($15.9 million) and
     higher shipments ($4.2 million)in  catalysts and additives partially offset
     by lower pricing ($1.8 million).

     Fine  Chemicals' net sales for the first nine months of 2002 increased 1.4%
     or $4.7 million from the corresponding period in 2001, primarily due to the
     increase in net sales of $33.7  million  resulting  from the mid-year  2001
     acquisitions  of  Martinswerk  GmbH  and  the  custom  and  fine  chemicals
     businesses  of  ChemFirst  Inc.  offset,  in  part,  by lower  pricing  and
     shipments in  agrichemicals  and fine chemistry  services ($18.0  million),
     product mix in performance chemicals ($9.2 million), and lower shipments in
     pharmachemicals ($1.6 million).

     Operating  profit  by  reportable   business   operating  segment  for  the
     nine-months periods ended September 30, 2002, and 2001 are as follows:

                                               Operating Profit
                                                (In Thousands)
                                         -----------------------------
                                            2002                2001
                                         ---------          ----------
    Polymer Chemicals                     $52,019             $50,363
    Fine Chemicals                         46,314              42,155
                                         ---------          ----------
    Segment totals                         98,333              92,518
    Corporate and other expenses          (17,280)            (15,171)
                                         ---------          ----------
      Operating profit                    $81,053             $77,347
                                         =========          ==========

     Polymer  Chemicals' first nine months of 2002 segment  operating profit was
     up 3.3% or $1.7 million from the  corresponding  period in 2001,  primarily
     due to higher  shipments  ($12.4  million) and favorable raw material costs
     ($10.1  million)  offset by lower  pricing  ($15.0  million),  higher  SG&A
     expenses and R&D expenses on the 2001 mid-year acquisitions ($2.6 million),
     a first  quarter 2002  reclassification  of bad debt expense to the Polymer
     Chemicals' segment from corporate and other expenses ($2.0 million), higher
     manufacturing  costs  ($1.0  million)  and the  unfavorable  net effects of
     foreign exchange ($0.4 million).

     Fine  Chemicals'  first  nine  months  of  2002  segment  operating  profit
     increased  9.9% or $4.1  million  from  the  corresponding  period  in 2001
     primarily due to favorable plant  utilization  and production  costs ($17.8
     million) and favorable raw material costs ($13.5 million), offset, in part,
     by lower shipments ($10.6 million) and pricing ($11.8 million) and a charge
     of $2.8 million

 Page 21

     ($6.8 million,  net of a probable  insurance recovery of $4.0 million) that
     related to the  discontinuance  of product  support for and the  withdrawal
     from a water  treatment  venture as well as higher  SG&A  expenses  and R&D
     expenses on the 2001 mid-year acquisitions ($2.1 million).

     Corporate  and other  expenses  for the first  nine  months of 2002 were up
     13.9%, or $2.1 million,  from the corresponding  period in 2001,  primarily
     due to higher  employee  related costs and a first  quarter 2002  workforce
     reduction charge of $0.9 million,  offset, in part, by a first quarter 2002
     reclassification  of bad debt  expense  to the  Polymer  Chemicals  segment
     operating profit from corporate and other expenses ($2.0 million).

     Interest and Financing Expenses

     Interest and financing expenses for the first nine months of 2002 decreased
     $0.4  million  from  $4.2  million  in the  corresponding  period  of  2001
     primarily due to a lower average  interest rate offset,  in part, by higher
     average outstanding debt in the 2002 period.

     Other Income, Net

     Other  income,  net for the  first  nine  months of 2002  amounted  to $2.2
     million,  down $1.6 million  from the  corresponding  period in 2001.  Nine
     months  2002  reflects  the  writedown  of a minority  interest  in a joint
     venture amounting to $1.0 million and the writeoff of an investment in ACTA
     Technology, Inc. totaling $0.5 million.

     Income Taxes

     Income  taxes for the first nine months of 2002 were lower  compared to the
     same period in 2001 due to a Federal  income tax  settlement,  amounting to
     $2.5  million,  that was received in April 2002,  and lower  income  before
     taxes in the 2002  period,  partially  offset by the  reversal in 2001 of a
     deferred  tax  valuation  allowance  associated  with one of the  Company's
     foreign  subsidiaries.  The  effective  income  tax rate for the first nine
     months of 2002 was 27.2%,  down from 29.7% in the  corresponding  period of
     2001.  Excluding the income tax settlement,  the nine months 2002 effective
     income tax rate was 30.3%.  The Company  expects to maintain  its  targeted
     income tax rate of 30% for the fourth  quarter of 2002 and a blended income
     tax rate for the year of approximately 28%.


     Financial Condition and Liquidity
     ---------------------------------

     Cash and cash  equivalents  at  September  30,  2002,  were $36.1  million,
     representing  an increase of $5.5  million  from $30.6  million at year-end
     2001.

     Cash flows provided from operating  activities of $127.9 million,  together
     with  $104.0  million  of  proceeds  from  borrowings,  primarily  from the
     Company's primary credit agreements, were used primarily to cover repayment
     of debt,  the purchase of  approximately  4 million shares of the Company's
     common stock, capital expenditures,  payment of dividends and increase cash
     and cash  equivalents by $5.5 million.  The Company  anticipates  that cash
     provided  from  operations  in the  future  will be  sufficient  to pay its
     operating  expenses,  satisfy  debt-service  obligations  and make dividend
     payments.

     The change in the Company's  accumulated  other  comprehensive  income from
     December 31, 2001, was primarily due to net foreign  currency  adjustments,
     net of related deferred taxes,

 Page 22

     primarily  related to the strengthening of the Euro and Japanese Yen versus
     the U.S. Dollar.

     On September 10, 2002, the Company entered into a new three-year  unsecured
     Credit  Agreement  with a group of lenders  providing  for $375  million in
     revolving credit facilities to replace its former  Competitive  Advance and
     Revolving  Credit  Facility  Agreement which matured on September 29, 2002.
     Borrowing  under the credit  facility is conditioned  upon  compliance with
     financial and other covenants set forth in the related agreement, including
     covenants  relating to leverage (measured as the ratio of debt and interest
     to  adjusted  earnings).  We  currently  are in  compliance  with  all such
     covenants.  An increase in pricing  level  based on the  Company's  debt to
     capitalization  ratio would not accelerate the maturity of our indebtedness
     thereunder.  However, an increase in our debt to capitalization ratio would
     result in an  increase  in the  interest  rate and fees  payable  under the
     credit facility.

     The noncurrent  portion of the Company's  long-term debt amounted to $177.6
     million at  September  30,  2002,  compared to $12.4  million at the end of
     2001. The Company's  long-term debt,  including the current  portion,  as a
     percentage of total capitalization amounted to 24.3% at September 30, 2002.
     The Company is guarantor of $17.2 million of long-term debt, in the form of
     commitments,  on behalf of its  50-percent  owned  joint  venture  company,
     Jordan Bromine Company Limited. The Company's long-term debt, including the
     guarantee,  as a  percent  of  total  capitalization  amounted  to 26.0% at
     September 30, 2002.

     The Company's  capital  expenditures  in the first nine months of 2002 were
     lower than the same period of 2001. For the year, capital  expenditures are
     forecasted  to be lower  than  the 2001  level.  Capital  spending  will be
     financed  primarily with cash flow from  operations  with  additional  cash
     needed,  if any,  to be  provided  from debt.  The amount and timing of any
     additional   borrowings   will  depend  on  the  Company's   specific  cash
     requirements.

     The  Company   operates  with  defined  pension  benefit  plans  that  have
     historically  been  over-funded.  With the present situation in U.S. equity
     markets and current interest rates,  which affect actuarial  discount rates
     and, in turn, the accumulated  benefit  obligation of our pension plans, it
     is likely that the Company will have to make cash  contributions that range
     between $10 million and $20 million to maintain a fully funded position and
     avoid an other  comprehensive  income  adjustment to shareholders'  equity.
     Should a cash  contribution  be required  this  calendar  year,  it will be
     financed through our new Credit Agreement. Of course, this is all dependent
     on the future performance of the equity markets.

     The Company is subject to federal,  state,  local and foreign  requirements
     regulating the handling,  manufacture  and use of materials  (some of which
     may  be  classified  as  hazardous  or  toxic  by one  or  more  regulatory
     agencies),  the  discharge  of  materials  into  the  environment  and  the
     protection of the environment.  To the Company's knowledge, it currently is
     complying, and expects to continue to comply, in all material respects with
     existing  environmental laws,  regulations,  statutes and ordinances.  Such
     compliance with federal, state, local and foreign environmental  protection
     laws is not expected to have in the future a material effect on earnings or
     the competitive position of Albemarle.

 Page 23

     Among  other  environmental  requirements,  the  Company  is subject to the
     federal  Superfund law, and similar state laws, under which the Company may
     be designated as a  potentially  responsible  party and may be liable for a
     share of the costs  associated  with  cleaning up various  hazardous  waste
     sites.

     Additional Information
     ----------------------
     Summary of Critical Accounting Policies:
     ----------------------------------------

     Consolidation

     The consolidated  financial  statements include the accounts and operations
     of  Albemarle  Corporation  and all of its  majority-owned  and  controlled
     subsidiaries.  The Company  applies  the equity  method of  accounting  for
     investments   between  20%  and  50%  owned  over  which  the  Company  has
     significant   influence.   All   significant   intercompany   accounts  and
     transactions  are  eliminated  in  consolidation.   Minority  shareholders'
     interest  in  controlled  subsidiaries  is  included  in  other  noncurrent
     liabilities  in the balance sheet and other  (expense)  income,  net in the
     consolidated statements of income for periods ended September 30, 2002.

     Estimates and Reclassifications

     The  preparation  of financial  statements  in  conformity  with  generally
     accepted  accounting  principles  requires management to make estimates and
     assumptions that affect the reported amounts of revenues,  expenses, assets
     and liabilities and disclosure of contingent  assets and liabilities at the
     date of the financial  statements.  Actual  results could differ from those
     estimates.

     Revenue Recognition

     Sales revenue is recognized when (1) ownership and all rewards and risks of
     loss  have  been  transferred  to the  buyer,  (2) the  price is fixed  and
     determinable,  and (3) collectibility is reasonably  assured.  Revenue from
     services is recognized when costs of providing services are incurred.

     Inventories

     Inventories are stated at the lower of cost or market, with cost determined
     on the last-in,  first-out  ("LIFO") basis for  substantially  all domestic
     inventories except stores and supplies,  and on either the weighted-average
     or first-in, first-out cost basis for other inventories.

     Property, Plant and Equipment

     Accounts include costs of assets constructed or purchased, related delivery
     and  installation  costs  and  interest  incurred  on  significant  capital
     projects during their construction  periods.  Expenditures for renewals and
     betterments  also  are  capitalized,   but  expenditures  for  repairs  and
     maintenance are expensed as incurred. The cost and accumulated depreciation
     applicable  to  assets  retired  or sold are  removed  from the  respective
     accounts, and gains or losses thereon are included in income.  Depreciation
     is computed  primarily by the  straight-line  method based on the estimated
     useful lives of the assets.

     The Company evaluates historical and expected  undiscounted  operating cash
     flows of the related business segments or fair value of property, plant and
     equipment to determine the future recoverability of any property, plant and
     equipment recorded.  Recorded property, plant

 Page 24

     and  equipment  is  re-evaluated  on the  same  basis  at the  end of  each
     accounting period whenever any significant permanent changes in business or
     circumstances have occurred which might impair recovery.

     The costs of brine  leases and  royalty  interests  are  amortized  using a
     method approximating the units-of-production method.

     Environmental Compliance and Remediation

     Environmental  compliance  costs  include  the  cost of  purchasing  and/or
     constructing  assets to  prevent,  limit  and/or  control  pollution  or to
     monitor  the  environmental  status at various  locations.  These costs are
     capitalized and depreciated based on estimated useful lives.  Environmental
     compliance costs also include  maintenance and operating costs with respect
     to pollution  prevention and control  facilities  and other  administrative
     costs.  Such  operating  costs  are  expensed  as  incurred.  Environmental
     remediation  costs of facilities  used in current  operations are generally
     immaterial and are expensed as incurred.

     The   Company   accrues   for    environmental    remediation   costs   and
     post-remediation  costs on an undiscounted basis at facilities or off-plant
     disposal sites that relate to existing conditions caused by past operations
     in the accounting  period in which  responsibility  is established and when
     the  related  costs are  estimable.  In  developing  these cost  estimates,
     evaluation is given to currently  available facts regarding each site, with
     consideration  given to existing  technology,  presently  enacted  laws and
     regulations,  prior  experience in remediation of contaminated  sites,  the
     financial  capability of other  potentially  responsible  parties and other
     factors,  subject to  uncertainties  inherent  in the  estimation  process.
     Additionally,  these estimates are reviewed periodically,  with adjustments
     to the accruals recorded as necessary.

     Pension Plans and Other Postretirement Benefits

     Annual costs of pension plans are determined actuarially based on Financial
     Accounting  Standards  Board  ("FASB")  Statement of  Financial  Accounting
     Standards ("SFAS") No. 87, "Employers'  Accounting for Pensions" ("SFAS No.
     87").  The  Company's  policy is to fund U.S.  pension plans at amounts not
     less  than the  minimum  requirements  of the  Employee  Retirement  Income
     Security Act of 1974 and generally for obligations  under its foreign plans
     to deposit  funds with trustees  and/or under  insurance  policies.  Annual
     costs of other  postretirement  plans are  accounted  for based on SFAS No.
     106,  "Employers'   Accounting  for  Postretirement   Benefits  Other  than
     Pensions."  The  policy of the  Company is to fund  post-retirement  health
     benefits  for  retirees on a  pay-as-you-go  basis.  There are  significant
     assumptions  used in  determining  amounts  including  the  discount  rate,
     expected return on plan assets,  rate of compensation  increase and assumed
     health care trend rate.

     Income Taxes

     The Company and its subsidiaries  file consolidated U.S. Federal income tax
     returns and individual foreign income tax returns.

     Deferred income taxes result from temporary  differences in the recognition
     of income and expenses for  financial  and income tax  reporting  purposes,
     using the  liability or balance sheet method.  Such  temporary  differences
     result primarily from differences  between the financial statement carrying
     amounts and tax basis of assets and liabilities  using enacted tax rates in
     effect in the years in which the differences are expected to reverse. It is
     the Company's  policy

 Page 25

     to record  deferred income taxes on any  undistributed  earnings of foreign
     subsidiaries  that  are  not  deemed  to be,  or are  not  intended  to be,
     permanently reinvested in those subsidiaries.

     Stock-Based Compensation

     The Company accounts for stock-based compensation using the intrinsic value
     method  prescribed in Accounting  Principles Board No. 25,  "Accounting for
     Stock Issued to Employees" and related interpretations. Under the intrinsic
     method,  compensation  cost for stock options is measured as the excess, if
     any, of the quoted market price of the Company's stock at the date of grant
     over the amount an employee must pay to acquire the stock.

     Research and Development Expenses

     The Company-sponsored  research and development expenses related to present
     and future products are expensed currently as incurred.

     Outlook
     -------

     FINE CHEMICALS
     In the Company's end markets for  agrichemicals , there has continued to be
     volatility.  Poor  growing  conditions  in the United  States and  economic
     instabilities in Latin America have combined to decrease the demand for the
     Company's products by its agrichemicals customers. At the present time, the
     Company expects this downturn will continue into the fourth  quarter,  thus
     negating the significant seasonal  agrichemicals  performance that normally
     occurs at the end of the year.  The Company's  pharmachemicals  business is
     expected  to be up and to  some  extent  should  offset  some or all of the
     agrichemicals business weakness.

     The Company's Jordan joint venture has established  bromine  production and
     begun initial  shipments.  This venture will be ramping up production  into
     next year and beyond.

     As the Company  moves forward  toward the close of 2002,  and into 2003, it
     will remain  cautious  about its outlook,  recognizing  poor  agrichemicals
     prospects as well as  generally  increasing  raw  material  prices for fine
     chemicals.  However,  the Company will continue to drive controllable costs
     down and where possible work toward selective  opportunities  for increased
     pricing in the markets,  still  believing that 2002 can show an improvement
     over 2001.

     POLYMER CHEMICALS
     The Company's flame retardants  business has seen good volume growth in the
     previous two quarters on a year-over-year basis. This relatively high level
     of volume has been  maintained  since the second quarter of this year, with
     the third quarter  essentially  flat  sequentially  and with continued good
     volumes in this business so far this quarter.  However, the Company remains
     cautious in its outlook due to the uncertainty in end-market demand of many
     of its customers  (especially in the relatively anemic consumer electronics
     business  sector,  its major end use) and with general  concerns  about the
     global economy.

     The recent labor  actions  resulting in the West Coast dock  situation  has
     caused delays in the Company's shipments, primarily to Asia. The Company is
     working diligently,  using other alternatives to assure it maintains supply
     continuity,  but  recognizes  it could  incur  additional  costs that might
     amount to as much as $1 million as a result. In addition, the Company has

 Page 26

     certain plant turnarounds  planned in the fourth quarter that will increase
     its factory costs in some of its Catalyst and Additives businesses.

     Overall, the Company has had a strong start in its fourth quarter business,
     continuing with strong volumes in most areas. The Company remains confident
     with its position and its ability to continue to deliver quarterly earnings
     this year that are an  improvement  over those of 2001 and,  at this point,
     are comfortable with the published range of earnings estimates for the year
     before any special items or unusual global events.

     As mentioned earlier in the Financial Condition and Liquidity section,  due
     to the Company's historical overfunded position, it recorded pension income
     in 2001 and will record a lower amount in 2002.  This is expected to unwind
     further over the next few years.

     Additional  information  regarding the Company,  its products,  markets and
     financial  performance  is provided  at the  Company's  Internet  web site,
     www.Albemarle.com.


     ITEM 3. Quantitative and Qualitative Disclosures About Market Risk
             -----------------------------------------------------------

     There  have  been  no  significant  changes  in  our  interest  rate  risk,
     marketable  security  price  risk  or raw  material  price  risk  from  the
     information provided in our Form 10-K for the year ended December 31, 2001.


     ITEM 4. Controls and Procedures
             -----------------------

     Within the 90-day period prior to the filing of this report,  an evaluation
     was  performed  under  the  supervision  and  with  the   participation  of
     Albemarle's  management,  including our principal executive officer and our
     principal  financial  officer,  of  the  effectiveness  of the  design  and
     operation of our  disclosure  controls and  procedures (as defined in Rules
     13a-14(c) and 15d-14(c) under the Securities  Exchange Act of 1934).  Based
     upon that  evaluation,  our principal  executive  officer and our principal
     financial  officer  concluded  that  the  design  and  operation  of  these
     disclosure  controls and  procedures  were  effective for the third quarter
     2002. No significant changes were made in our internal controls or in other
     factors that could  significantly  affect these controls  subsequent to the
     date of their evaluation.


     Part II - OTHER INFORMATION
     ---------------------------

     ITEM 1. Legal Proceedings
             ------------------

     The Company and its  subsidiaries  are involved  from time to time in legal
     proceedings  of types  regarded  as  common  in the  Company's  businesses,
     particularly  administrative or judicial  proceedings  seeking  remediation
     under  environmental  laws,  such  as  Superfund,  and  products  liability
     litigation.

     While it is not  possible  to  predict  or  determine  the  outcome  of the
     proceedings  presently  pending,  in the Company's  opinion they should not
     result  ultimately in liabilities  likely to have a material adverse effect
     upon the results of  operations  or financial  condition of the Company and
     its subsidiaries on a consolidated basis.

 Page 27

     ITEM 5. Other Information
             -----------------

     During the third  quarter,  Mark C. Rohr was  elected  President  and Chief
     Executive  Officer of the Company,  effective  October 1, 2002.  After that
     date,  Floyd D. Gottwald,  Jr., began serving as Vice Chairman of the Board
     and continued as Chairman of the Executive Committee.  On October 23, 2002,
     the  Company   announced   that  Rohr  would   relocate  to  the  Company's
     headquarters in Richmond, Virginia.

     In addition, the Company announced that Michael J. Zobrist, Vice President,
     Investor Relations and External Affairs had elected to retire at the end of
     the year and that Michael D. Whitlow,  Vice  President - Americas Sales and
     Global Accounts, would assume the responsibilities  currently undertaken by
     Zobrist, effective January 1, 2003. The Company also announced that Anthony
     S. Parnell has been  promoted to the position of Division  Vice  President,
     Americas Sales effective November 1, 2002, succeeding Mr. Whitlow.  Whitlow
     will report to Paul F. Rocheleau, Senior Vice President and Chief Financial
     Officer, and in that role will relocate to Richmond.

     Albemarle's  Board of  Directors  elected  Lloyd B.  Andrew  to the  Board,
     effective  October 1. Andrew,  79, served on  Albemarle's  Board from March
     1994 until December 1995. Previously,  he had been Executive Vice President
     and Chief Financial Officer of Ethyl Corporation, retiring in 1989.


     ITEM 6. Exhibits and Reports on Form 8-K
             ---------------------------------

           (a) Exhibits

               The following documents are filed as exhibits to this Form
               10-Q pursuant to Item 601 of Regulation S-K:

               3(ii) By-laws of the registrant, amended in October 2002.

               10.1  Credit Agreement dated September 10, 2002.

               99.   List of Albemarle Corporation Officers.


           (b) The Company  submitted a form 8-K document on August 14, 2002,
               with which it submitted sworn certifications of its chief
               executive officer and chief  financial  officer to the
               Securities  and  Exchange Commission ("SEC") pursuant to the
               SEC's Order 4-460 and Section 906 of the Sarbanes-Oxley Act of
               2002.

 Page 28






                                   SIGNATURES
                                   ----------

     Pursuant to the  requirements  of the Securities  Exchange Act of 1934, the
     registrant  has duly  caused  this report to be signed on its behalf by the
     undersigned thereunto duly authorized.

                                                 ALBEMARLE CORPORATION
                                                 ---------------------
                                                      (Registrant)



     Date: November 12, 2002            By: s/ ROBERT G. KIRCHHOEFER
                                          -------------------------
                                          Robert G. Kirchhoefer
                                          Treasurer and Chief Accounting Officer
                                          (Principal Accounting Officer)


 Page 29

                    CERTIFICATION OF CHIEF EXECUTIVE OFFICER
                    ----------------------------------------

     I, Mark C. Rohr,  certify that:

     1. I have  reviewed  this  quarterly  report  on  Form  10-Q  of  Albemarle
     Corporation;

     2. Based on my knowledge, this quarterly report does not contain any untrue
     statement of a material fact or omit to state a material fact  necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this quarterly report;

     3. Based on my knowledge,  the financial  statements,  and other  financial
     information  included  in this  quarterly  report,  fairly  present  in all
     material respects the financial  condition,  results of operations and cash
     flows of the  registrant  as of, and for,  the  periods  presented  in this
     quarterly report;

     4. The  registrant's  other  certifying  officers and I are responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     a) designed such disclosure controls and procedures to ensure that material
     information   relating  to  the  registrant,   including  its  consolidated
     subsidiaries,  is  made  known  to  us by  others  within  those  entities,
     particularly  during  the period in which  this  quarterly  report is being
     prepared;

     b) evaluated the effectiveness of the registrant's  disclosure controls and
     procedures  as of a date  within 90 days prior to the  filing  date of this
     quarterly  report  (the  "Evaluation  Date");  and

     c)  presented  in  this  quarterly   report  our   conclusions   about  the
     effectiveness  of the  disclosure  controls  and  procedures  based  on our
     evaluation as of the Evaluation Date;

     5. The registrant's other certifying  officers and I have disclosed,  based
     on our most recent evaluation,  to the registrant's  auditors and the audit
     committee of  registrant's  board of directors (or persons  performing  the
     equivalent  function):

     a) all  significant  deficiencies  in the design or  operation  of internal
     controls which could adversely affect the  registrant's  ability to record,
     process,  summarize and report  financial data and have  identified for the
     registrant's auditors any material weaknesses in internal controls;  and

     b) any fraud,  whether or not material,  that involves  management or other
     employees  who  have  a  significant  role  in  the  registrant's  internal
     controls; and

     6. The registrant's other certifying  officers and I have indicated in this
     quarterly report whether or not there were significant  changes in internal
     controls  or in other  factors  that could  significantly  affect  internal
     controls  subsequent to the date of our most recent

 Page 30

     evaluation,  including any  corrective  actions with regard to  significant
     deficiencies and material weaknesses.

     Date: November 11, 2002

        /S/ MARK C. ROHR
     ------------------------
     President and Chief Executive Officer

 Page 31

                    CERTIFICATION OF CHIEF FINANCIAL OFFICER
                    ----------------------------------------

     I, Paul F.  Rocheleau,  certify that:

     1. I have  reviewed  this  quarterly  report  on  Form  10-Q  of  Albemarle
     Corporation;

     2. Based on my knowledge, this quarterly report does not contain any untrue
     statement of a material fact or omit to state a material fact  necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this quarterly report;

     3. Based on my knowledge,  the financial  statements,  and other  financial
     information  included  in this  quarterly  report,  fairly  present  in all
     material respects the financial  condition,  results of operations and cash
     flows of the  registrant  as of, and for,  the  periods  presented  in this
     quarterly report;

     4. The  registrant's  other  certifying  officers and I are responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     a) designed such disclosure controls and procedures to ensure that material
     information   relating  to  the  registrant,   including  its  consolidated
     subsidiaries,  is  made  known  to  us by  others  within  those  entities,
     particularly  during  the period in which  this  quarterly  report is being
     prepared;

     b) evaluated the effectiveness of the registrant's  disclosure controls and
     procedures  as of a date  within 90 days prior to the  filing  date of this
     quarterly report (the "Evaluation Date"); and

     c)  presented  in  this  quarterly   report  our   conclusions   about  the
     effectiveness  of the  disclosure  controls  and  procedures  based  on our
     evaluation as of the Evaluation Date;

     5. The registrant's other certifying  officers and I have disclosed,  based
     on our most recent evaluation,  to the registrant's  auditors and the audit
     committee of  registrant's  board of directors (or persons  performing  the
     equivalent  function):

     a) all  significant  deficiencies  in the design or  operation  of internal
     controls which could adversely affect the  registrant's  ability to record,
     process,  summarize and report  financial data and have  identified for the
     registrant's auditors any material weaknesses in internal controls;  and

     b) any fraud,  whether or not material,  that involves  management or other
     employees  who  have  a  significant  role  in  the  registrant's  internal
     controls; and

     6. The registrant's other certifying  officers and I have indicated in this
     quarterly report whether or not there were significant  changes in internal
     controls  or in other  factors  that could  significantly  affect  internal
     controls  subsequent to the date of our most recent

 Page 32

     evaluation,  including any  corrective  actions with regard to  significant
     deficiencies and material weaknesses.

     Date: November 11, 2002

       /S/ PAUL F. ROCHELEAU
     ------------------------
     Senior Vice President and Chief Financial Officer

 Page 33

                                 EXHIBIT INDEX
                                 -------------
                                                                        Page
                                                                      Number(s)
                                                                      ---------

3(ii) By-laws of the registrant amended in October 2002                  34-56

10.1  Credit Agreement dated September 10, 2002.                        57-200

99.   List of Albemarle Corporation Officers                               201


 Page 34

EXHIBIT 3(ii)
-------------

                              ALBEMARLE CORPORATION


                                     BY-LAWS



                                    ARTICLE I

                             Meeting of Shareholders


     Section 1. Places of Meetings.

     All meetings of the shareholders shall be held at such place, either within
     or without the  Commonwealth  of Virginia,  as may,  from time to time,  be
     fixed by the Board of Directors.

     Section 2. Annual Meetings.

     The annual meeting of the  shareholders,  for the election of directors and
     transaction of such other business as may come before the meeting, shall be
     held each year at 11:00  a.m.  EST on the fourth  Wednesday  in March or at
     such other date and time as the Board of Directors of the  Corporation  may
     designate from time to time.

     Section 3.  Special  Meetings.

     Special  meetings of shareholders for any purpose or purposes may be called
     at any time by the Chief Executive Officer, the Chairman of the Board or by
     a majority of the Board of  Directors.  At a special  meeting,  no business
     shall be transacted and no corporate  action shall be taken other than that
     stated in the notice of the meeting.

     Section 4. Notice of Meetings.

     Except as otherwise  required by law or these  By-laws,  written or printed
     notice stating the place, day and hour of every meeting of the shareholders
     and, in case of a special  meeting,  the purpose or purposes  for which the
     meeting  is  called,  shall be mailed  not less than ten (10) nor more than
     sixty (60) days  before  the date of the  meeting  to each  shareholder  of
     record  entitled  to vote  at such


 Page 35

     meeting, at his or her address which appears in the share transfer books of
     the   Corporation.   Meetings  may  be  held  without  notice  if  all  the
     shareholders  entitled  to vote at the  meeting are present in person or by
     proxy or if notice is waived in writing by those not present, either before
     or after the meeting.

     Section  5.  Quorum.

     Except as otherwise  required by the Articles of Incorporation,  any number
     of  shareholders  together  holding at least a majority of the  outstanding
     shares of capital stock entitled to vote with respect to the business to be
     transacted,  who shall be present in person or  represented by proxy at any
     meeting  duly called,  shall  constitute  a quorum for the  transaction  of
     business.  If less  than a quorum  shall be in  attendance  at the time for
     which a meeting shall have been called,  the meeting may be adjourned  from
     time to time by a majority of the  shareholders  present or  represented by
     proxy without notice other than by announcement at the meeting.

     Section 6. Voting.

     At any meeting of the shareholders  each shareholder of a class entitled to
     vote on the  matters  coming  before the  meeting  shall have one vote,  in
     person or by proxy,  for each share of capital stock standing in his or her
     name on the books of the  Corporation at the time of such meeting or on any
     date fixed by the Board of Directors  not more than seventy (70) days prior
     to the meeting.

     Section 7. Voting  List.

     The officer or agent having charge of the stock  transfer  books for shares
     of the  Corporation  shall make, at least ten (10) days before each meeting
     of shareholders,  a complete list of the  shareholders  entitled to vote at
     such meeting or any adjournment thereof, with the address of and the number
     of shares held by each.  Such list,  for a period of ten (10) days prior to
     such  meeting,  shall  be  kept on file  at the  registered  office  of the
     Corporation  or at its principal  place of business or at


 Page 36

     the  office of its  transfer  agent or  registrar  and shall be  subject to
     inspection by any shareholder at any time during usual business hours. Such
     list  shall  also be  produced  and kept  open at the time and place of the
     meeting and shall be subject to the  inspection of any  shareholder  during
     the whole time of the meeting.  The original  stock transfer books shall be
     prima  facie  evidence as to who are the  shareholders  entitled to examine
     such list or transfer books or to vote at any meeting of  shareholders.  If
     the requirements of this section have not been substantially complied with,
     the meeting shall,  on the demand of any shareholder in person or by proxy,
     be adjourned until the requirements are complied with.

     Section 8. Shareholder Proposals.

     (a)  Annual Meetings of Shareholders.

     (i)  Nominations  of persons for  election to the Board of Directors of the
     Corporation   and  the  proposal  of  business  to  be  considered  by  the
     shareholders  may be made at an annual  meeting  of  shareholders  only (A)
     pursuant  to  the  Corporation's  notice  of  meeting  (or  any  supplement
     thereto),  (B) by or at the  direction  of the Board of Directors or (C) by
     any  shareholder of the  Corporation who was a shareholder of record of the
     Corporation  who is  entitled to vote at the meeting at the time the notice
     provided  for  in  this  section  is  delivered  to  the  Secretary  of the
     Corporation  and who complies with the notice  procedures set forth in this
     section.

     (ii) For  nominations  or other  business to be properly  brought before an
     annual meeting by a shareholder  pursuant to clause (C) of paragraph (a)(i)
     of this section,  the shareholder  must have given timely notice thereof in
     writing to the Secretary of the Corporation and any such proposed  business
     other  than  the


 Page 37

     nominations  of  persons  for  election  to the  Board  of  Directors  must
     constitute  a  proper  matter  for  shareholder  action.  To be  timely,  a
     shareholder's  notice shall be delivered to the  Secretary at the principal
     executive  offices of the  Corporation not later than the close of business
     on the  ninetieth  day nor  earlier  than the close of  business on the one
     hundred  twentieth  day prior to the  first  anniversary  of the  preceding
     year's annual meeting (provided,  however,  that in the event that the date
     of the annual  meeting is more than thirty days before or more than seventy
     days after such  anniversary  date,  notice by the  shareholder  must be so
     delivered  not  earlier  than the  close  of  business  on the one  hundred
     twentieth day prior to such annual  meeting and not later than the close of
     business on the later of the ninetieth day prior to such annual  meeting or
     the tenth day following the day on which public announcement of the date of
     such  meeting  is first  made by the  Corporation).  In no event  shall the
     public  announcement of an adjournment or postponement of an annual meeting
     commence a new time period (or extend any time  period) for the giving of a
     shareholder's  notice as described above. Such  shareholder's  notice shall
     set forth: (A) as to each person whom the shareholder  proposes to nominate
     for election as a director all information  relating to such person that is
     required  to be  disclosed  in  solicitations  of proxies  for  election of
     directors in an election  contest,  or is  otherwise  required in each case
     pursuant to Regulation  14A under the  Securities  Exchange Act of 1934, as
     amended (the "Exchange  Act") (and such person's  written  consent to being
     named in the proxy statement as a nominee and to serving as such a director
     if elected);  (B) as to any other business that the shareholder proposes to
     bring before the meeting, a brief description of the business desired to be
     brought before the meeting, the text of the proposal or business (including

 Page 38

     the text of any  resolutions  proposed for  consideration  and in the event
     that  such  business  includes  a  proposal  to amend  the  By-laws  of the
     Corporation,  the  language  of the  proposed  amendment),  the reasons for
     conducting  such business at the meeting and any material  interest in such
     business of such shareholder and for the beneficial owner, if any, on whose
     behalf  the  proposal  is made;  and (C) as to the  shareholder  giving the
     notice and the beneficial  owner, if any, on whose behalf the nomination or
     proposal  is made (1) the name and  address  of such  shareholder,  as they
     appear on the  Corporation's  books, and of such beneficial  owner, (2) the
     class and number of shares of  capital  stock of the  Corporation  that are
     owned  beneficially  and of record by such  shareholder and such beneficial
     owner, (3) a  representation  that the shareholder is a holder of record of
     stock of the  Corporation  entitled to vote at such  meeting and intends to
     appear in person or by proxy at the  meeting to propose  such  business  or
     nomination,  and  (4) a  representation  whether  the  shareholder  or  the
     beneficial owner, if any, intends or is part of a group that intends (a) to
     deliver a proxy  statement  and/or form of proxy to holders of at least the
     percentage  of the  Corporation's  outstanding  capital  stock  required to
     approve or adopt the proposal or elect the nominee  and/or (b) otherwise to
     solicit   proxies  from   shareholders  in  support  of  such  proposal  or
     nomination.  The foregoing notice requirements shall be deemed satisfied by
     a  shareholder  if the  shareholder  has  notified the  Corporation  of his
     intention  to present a proposal at an annual  meeting in  compliance  with
     Rule 14a-8 (or any successor  thereof)  promulgated  under the Exchange Act
     and such shareholder's proposal has been included in a proxy statement that
     has been  prepared by the  Corporation  to solicit  proxies for such annual
     meeting.  The Corporation may require any proposed  nominee to furnish such
     other


 Page 39

     information  as it may reasonably  require to determine the  eligibility of
     such proposed nominee to serve as a director of the Corporation.

     (iii) Notwithstanding  anything in the second sentence of paragraph (a)(ii)
     of this section to the contrary,  in the event that the number of directors
     to be elected to the Board of  Directors  of the  Corporation  at an annual
     meeting is increased and there is no public announcement by the Corporation
     naming the nominees for the additional  directorships  at least one hundred
     days prior to the first anniversary of the preceding year's annual meeting,
     a  shareholder's  notice  required by this section shall also be considered
     timely, but only with respect to nominees for the additional directorships,
     if it  shall be  delivered  to the  Secretary  at the  principal  executive
     offices  of the  Corporation  not later than the close of  business  on the
     tenth day following the day on which such public announcement is first made
     by the Corporation.

     (b) Special Meetings of Shareholders.

     Only such business shall be conducted at a special  meeting of shareholders
     as shall have been brought before the meeting pursuant to the Corporation's
     notice of  meeting.  Nominations  of persons  for  election to the Board of
     Directors  may be  made at a  special  meeting  of  shareholders  at  which
     directors are to be elected pursuant to the Corporation's notice of meeting
     (i) by or at the  direction of the Board of Directors or (ii) provided that
     the Board of Directors has determined  that  directors  shall be elected at
     such meeting, by any shareholder of the Corporation who is a shareholder of
     record at the time the notice  provided for in this section is delivered to
     the  Secretary of the  Corporation,  who is entitled to vote at the meeting
     and upon such  election and who  complies  with the notice  procedures  set
     forth in this section. In the event the Corporation calls a special meeting
     of shareholders for

 Page 40

     the purpose of electing one or more  directors  to the Board of  Directors,
     any such  shareholder  entitled to vote in such  election of directors  may
     nominate  a person or  persons,  as the case may be, for  election  to such
     position(s)  as specified in the  Corporation's  notice of meeting,  if the
     shareholder's  notice  required  by  paragraph  (a)(ii) of this  section is
     delivered  to the  Secretary  at the  principal  executive  offices  of the
     Corporation  not  earlier  than the close of  business  on the one  hundred
     twentieth day prior to such special  meeting,  and not later than the close
     of business on the later of the ninetieth day prior to such special meeting
     or the tenth day  following the day on which public  announcement  is first
     made of the date of the special meeting and of the nominees proposed by the
     Board of  Directors  to be elected at such  meeting.  In no event shall the
     public  announcement of an adjournment or postponement of a special meeting
     commence a new time  period (or  extend  any time  period)  for giving of a
     shareholder's notice as described above.

     (c) General.

     (i) Only such persons who are nominated in accordance  with the  procedures
     set forth in this section shall be eligible at an annual or special meeting
     of  shareholders  of the  Corporation  to serve as directors  and only such
     business shall be conducted at a meeting of shareholders as shall have been
     brought  before the meeting in accordance  with the procedures set forth in
     this  section.  Except as  otherwise  provided by law,  the Chairman of the
     meeting shall have the power and duty (A) to determine whether a nomination
     or any  business  proposed  to be brought  before the  meeting  was made or
     proposed,  as the case may be, in accordance  with the procedures set forth
     in this section  (including whether the shareholder or beneficial owner, if
     any, on whose behalf the  nomination  or proposal is made  solicited (or is
     part

 Page 41

     of a group  which  solicited)  or did not so  solicit,  as the case may be,
     proxies in support of such shareholder's  nominee or proposal in compliance
     with such shareholder's  representation as required by clause (a)(ii)(C) of
     this section) and (B) to declare that such nomination  shall be disregarded
     or that such proposed business shall not be transacted. Notwithstanding the
     foregoing  provisions of this section,  if the shareholder (or a designated
     representative of the shareholder) does not appear at the annual or special
     meeting of  shareholders  of the  Corporation  to present a  nomination  or
     business,  such nomination shall be disregarded and such proposed  business
     shall not be  transacted,  notwithstanding  that proxies in respect of such
     vote may have been received by the Corporation.

     (ii) For purposes of this  section,  "public  announcement"  shall  include
     disclosure  in a press  release  reported  by the Dow Jones  News  Service,
     Associated  Press or  comparable  national  news  service  or in a document
     publicly  filed  by  the  Corporation  with  the  Securities  and  Exchange
     Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act.

     (iii)   Notwithstanding  the  foregoing   provisions  of  this  section,  a
     shareholder  shall also  comply  with all  applicable  requirements  of the
     Exchange Act and the rules and  regulations  thereunder with respect to the
     matters set forth in this section.  Nothing in this section shall be deemed
     to affect any rights (A) of shareholders to request  inclusion of proposals
     in the  Corporation's  proxy  statement  pursuant  to Rule 14a-8  under the
     Exchange  Act or (B) of the  holders  of any series of  preferred  stock to
     elect  directors  pursuant to any applicable  provisions of the articles of
     incorporation.

 Page 42

     Section 9. Inspectors.

     An appropriate  number of inspectors for any meeting of shareholders  shall
     be appointed by the Chairman of such meeting.  Inspectors so appointed will
     open and close the polls,  will  receive  and take  charge of  proxies  and
     ballots,  and will decide all questions as to the qualifications of voters,
     validity of proxies and ballots, and the number of votes properly cast.


                                   ARTICLE II

                                    Directors

     Section 1. General Powers.

     The  property,  affairs and  business of the  Corporation  shall be managed
     under the  direction  of the Board of  Directors,  and except as  otherwise
     expressly  provided by law, the Articles of Incorporation or these By-laws,
     all of the powers of the Corporation shall be vested in such Board.

     Section 2. Number of Directors.

     The Board of  Directors  shall be eleven (11) in number.  By  amendment  of
     these  By-laws the Board of Directors or the  shareholders  may increase or
     decrease  the number of  directors;  provided,  however,  that the Board of
     Directors may not increase or decrease the number of directors by more than
     thirty percent of the number of directors last elected by the shareholders.

     Section 3.  Election of Directors.

     (a)  Directors  shall  be  elected  each  year  at the  annual  meeting  of
     shareholders.

     (b) Directors shall hold their offices until the next annual meeting of the
     shareholders  and until their  successors are elected.  Any director may be
     removed from office as set forth in the Articles of Incorporation.

 Page 43

     (c) Any vacancy  occurring in the Board of  Directors  may be filled by the
     affirmative  vote of the majority of the  remaining  directors  though less
     than a quorum of the Board of Directors.

     (d) A majority  of the number of  directors  fixed by these  By-laws  shall
     constitute a quorum for the transaction of business.  The act of a majority
     of the directors present at a meeting at which a quorum is present shall be
     the act of the Board of Directors.

     Section 4. Meetings of Directors.

     Meetings  of the  Board of  Directors  shall be held at  places  within  or
     without the  Commonwealth  of Virginia and at times fixed by  resolution of
     the Board or upon call of the Chief  Executive  Officer or the  Chairman of
     the Board, and the Secretary or officer  performing the Secretary's  duties
     shall  give not  less  than  twenty-four  (24)  hours'  notice  by  letter,
     telegraph  or telephone  (or in person) of all  meetings of the  directors,
     provided  that notice need not be given of regular  meetings  held at times
     and places fixed by resolution of the Board. An annual meeting of the Board
     of Directors shall be held as soon as practicable  after the adjournment of
     the  annual  meeting  of  shareholders.  Meetings  may be held at any  time
     without notice if all of the Directors are present, or if those not present
     waive notice in writing  either before or after the meeting.  Directors may
     be allowed,  by resolution of the Board,  a reasonable fee and expenses for
     attendance at meetings.


                                  ARTICLE III


                                   Committees

     Section 1. Executive Committee.

     The  Board of  Directors  shall,  by vote of a  majority  of the  number of
     Directors  fixed by these By-laws,  designate an Executive

 Page 44

     Committee.  The members of the Executive  Committee shall serve until their
     successors are designated by the Board of Directors, until removed or until
     the  Executive  Committee  is  dissolved  by the  Board of  Directors.  All
     vacancies which may occur in the Executive Committee shall be filled by the
     Board of Directors.

     When the Board of  Directors  is not in session,  the  Executive  Committee
     shall have all power  vested in the Board of Directors by law, the Articles
     of  Incorporation  or these  By-laws,  except as otherwise  provided in the
     Virginia Stock Corporation Act. The Executive Committee shall report at the
     next regular or special  meeting of the Board of Directors all action which
     the  Executive  Committee  may have taken on behalf of the Board  since the
     last regular or special meeting of the Board of Directors.

     Meetings  of the  Executive  Committee  shall be held at such places and at
     such times fixed by resolution of the Committee,  or upon call of the Chief
     Executive  Officer,  the  Chairman  of the  Board  or the  Chairman  of the
     Executive Committee. Not less than twelve (12) hours' notice shall be given
     by letter,  telegraph  or  telephone  (or in person) of all meetings of the
     Executive  Committee,  provided  that  notice  need not be given of regular
     meetings  held at times and places fixed by resolution of the Committee and
     that meetings may be held at any time without  notice if all of the members
     of the  Committee  are  present  or if those not  present  waive  notice in
     writing  either  before or after the meeting.  A majority of the members of
     the  Executive  Committee  then serving  shall  constitute a quorum for the
     transaction of business at any meeting.

     Section 2. Executive Compensation Committee.

     The Board of Directors,  at its regular annual meeting,  shall designate an
     Executive  Compensation  Committee  which  shall  consist  of three or more
     Directors  who shall  not be  eligible  for  bonus,  stock  option or stock
     appreciation  rights. In addition,  the Board at any time may designate one
     or more  alternate  members of such  Committee  who shall be Directors  not
     eligible for bonus, stock option

 Page 45

     or stock  appreciation  rights who may act in place of any  absent  regular
     member upon invitation by the Chairman or Secretary of the Committee.

     With respect to bonuses,  the Executive  Compensation  Committee shall have
     and may exercise the powers to determine the amounts annually available for
     bonuses  pursuant to any bonus plan or formula  approved  by the Board,  to
     determine,  after  receiving  the  recommendations  of the Chief  Executive
     Officer and other members of management, bonus awards to executive officers
     and to exercise  such  further  powers with  respect to bonuses as may from
     time to time be conferred by the Board of Directors.

     With respect to  salaries,  the  Executive  Compensation  Committee,  after
     receiving  the  recommendations  of the Chief  Executive  Officer and other
     members of  management,  shall have and may  exercise  the power to fix and
     determine  from time to time all salaries of the executive  officers of the
     Corporation,  and such further  powers with respect to salaries as may from
     time to time be conferred by the Board of Directors.

     The Executive  Compensation  Committee shall  administer the  Corporation's
     Incentive  Stock  Option Plan (the "Plan") and from time to time may grant,
     consistent with the Plan, stock options and stock  appreciation  rights and
     authorize the granting of restricted stock awards.

     Vacancies in the Executive  Compensation  Committee  shall be filled by the
     Board of Directors, and members shall be subject to removal by the Board at
     any time.

 Page 46

     The Executive  Compensation Committee shall fix its own rules of procedure.
     A majority of the number of regular members then serving shall constitute a
     quorum;  and  regular and  alternate  members  present  shall be counted to
     determine whether there is a quorum. The Executive  Compensation  Committee
     shall keep  minutes of its  meetings,  and all action  taken by it shall be
     reported to the Board of Directors.

     Section 3. Audit Committee.

     The Board of Directors at its regular  annual  meeting  shall  designate an
     Audit  Committee  which  shall  consist  of three or more  Directors  whose
     membership on the Committee  shall meet the  requirements  set forth in the
     rules of the New York Stock Exchange, as amended from time to time.

     The  primary  function  of the  Committee  shall be to assist  the Board of
     Directors in  fulfilling  its oversight  responsibilities  by reviewing and
     overseeing  (i) the  financial  reports  and  other  financial  information
     provided by the Corporation to any  governmental  body or the public,  (ii)
     the  Corporation's  system  of  internal  controls  regarding  finance  and
     accounting   that  the   Corporation's   management   and  the  Board  have
     established,  (iii) the independence of the Corporation's  outside auditors
     and the performance of the Corporation's  internal and outside auditors and
     (iv)  the  Corporation's  auditing,   accounting  and  financial  reporting
     processes generally.  The Committee shall review the reports and minutes of
     any audit committees of the Corporation's subsidiaries. The Committee shall
     review the Corporation's financial reporting process,  including accounting
     policies and  procedures.  The  Committee  shall  examine the report of the
     Corporation's  outside  auditors,  consult  with them with respect to their
     report and the  standards and  procedures  employed by them in their audit,
     report to the Board the results of its study and recommend the selection of
     auditors for each fiscal year.

 Page 47

     Vacancies in the Committee  shall be filled by the Board of Directors  with
     Directors meeting the requirements set forth above, giving consideration to
     continuity of the Committee, and members shall be subject to removal by the
     Board at any time.

     The  Committee  shall fix its own rules of procedure  and a majority of the
     members  serving shall  constitute a quorum.  The  Committee  shall meet at
     least  twice a year  with  both  the  Corporation's  internal  and  outside
     auditors  present.  The Committee shall keep minutes of all of its meetings
     and all action taken shall be reported to the Board of Directors.

     Section 4. Nominating  Committee.

     The Board of Directors shall  designate a Nominating  Committee which shall
     consist   of  three  or  more   Directors.   The   Committee   shall   make
     recommendations  to the Board regarding  nominees for election as Directors
     by the  shareholders  at each  Annual  Shareholders'  Meeting and make such
     other recommendations regarding the Board of Directors as the Committee may
     deem advisable from time to time. The Committee  shall fix its own rules of
     procedure and a majority of the members serving shall constitute a quorum.

     Section 5. Other Committees of the Board.

     The Board of Directors,  by resolution  duly  adopted,  may establish  such
     other  committees  of the Board as it may deem  advisable  and the members,
     terms  and  authority  of such  committees  shall  be as set  forth  in the
     resolutions establishing the same.


                                   ARTICLE IV

                                    Officers

     Section 1. Election.

     The officers of the Corporation may consist of a Chief Executive Officer, a
     Chairman of the Board, a Vice Chairman of the Board, a President,

 Page 48

     one or more Vice  Presidents  (any one or more of whom may be designated as
     Executive  Vice  Presidents or Senior Vice  Presidents),  a Secretary and a
     Treasurer. In addition, such other officers as are provided in Section 3 of
     this  Article  may from time to time be elected by the Board of  Directors.
     All officers  shall hold office until the next annual  meeting of the Board
     of Directors  or until their  successors  are elected.  The Chairman of the
     Board and the Vice  Chairman  of the Board  shall be chosen  from among the
     Directors. Any two officers may be combined in the same person as the Board
     of Directors may determine.

     Section 2. Removal of Officers; Vacancies.

     Any officer of the  Corporation  may be removed  summarily  with or without
     cause,  at any time by a  resolution  passed at any meeting by  affirmative
     vote of a  majority  of the  number of  Directors  fixed by these  By-laws.
     Vacancies may be filled at any meeting of the Board of Directors.

     Section 3. Other Officers.

     Other  officers  may from time to time be elected by the Board,  including,
     without  limitation,  one  or  more  Assistant  Secretaries  and  Assistant
     Treasurers.

     Section 4. Duties.

     The officers of the Corporation shall have such duties as generally pertain
     to their  offices,  respectively,  as well as such powers and duties as are
     hereinafter  provided  and as from time to time shall be  conferred  by the
     Board of Directors.  The Board of Directors may require any officer to give
     such bond for the faithful  performance  of his duties as the Board may see
     fit.

         Section 5. Duties of the Chief Executive Officer.

     The Chief  Executive  Officer shall be responsible for the execution of the
     policies  of the Board of  Directors  and shall have  supervision  over the
     business  of the  Corporation  and its  several  officers,  subject

 Page 49

     to the authority of the Board of Directors. In the incapacity or absence of
     the  President,  the Chief  Executive  Officer shall perform the duties and
     have the authority of the President.  The Chief Executive  Officer may sign
     and  execute  in the  name  of the  Corporation  deeds,  mortgages,  bonds,
     contracts or other  instruments,  except in cases where the signing and the
     execution thereof shall be expressly delegated by the Board of Directors or
     by these By-laws to some other officer or agent of the Corporation or shall
     be required by law  otherwise  to be signed or executed.  In  addition,  he
     shall  perform  all duties  incident  to the office of the Chief  Executive
     Officer  and such other  duties as from time to time may be assigned to him
     by the Board of Directors.


     Section 6. Chairman of the Board.

     The Chairman of the Board shall  preside at all  meetings of  shareholders,
     the Board of Directors  and,  unless  there is a Chairman of the  Executive
     Committee, the Executive Committee.

     The  Chairman  of the  Board  may  sign  and  execute  in the  name  of the
     Corporation deeds, mortgages, bonds, contracts or other instruments, except
     in cases where the signing and the  execution  thereof  shall be  expressly
     delegated  by the Board of  Directors  or by these  By-laws  to some  other
     officer or agent of the  Corporation  or shall be required by law otherwise
     to be signed or executed. In addition, he shall perform all duties incident
     to the office of the  Chairman  of the Board and such other  duties as from
     time to time may be assigned to him by the Board of Directors.

     Section 7. Duties of the Vice Chairman of the Board.

     The Vice  Chairman  of the Board shall  perform all duties  incident to the
     office of the Vice  Chairman of the Board and shall have such other  powers
     and  duties  as may from  time to time be  assigned  to him by the Board of
     Directors,  the Chief Executive  Officer or the Chairman of the Board.

 Page 50

     The Vice  Chairman  of the  Board may sign and  execute  in the name of the
     Corporation  deeds,  mortgages,  bonds,  contracts  and other  instruments,
     except in cases where the signing and execution  thereof shall be expressly
     delegated  by the Board of  Directors  or by these  By-laws  to some  other
     officer or agent of the  Corporation  or shall be required by law otherwise
     to be signed or executed.

     Section 8. Duties of the President.

     The President shall be the Chief  Operating  Officer of the Corporation and
     shall have direct supervision over the business of the Corporation  subject
     to the authority of the Board of Directors, the Chief Executive Officer and
     the Chairman of the Board.  The  President may sign and execute in the name
     of the Corporation deeds, mortgages, bonds, contracts or other instruments,
     except in cases  where  the  signing  and the  execution  thereof  shall be
     expressly  delegated by the Board of Directors or by these  By-laws to some
     other  officer  or agent of the  Corporation  or shall be  required  by law
     otherwise  to be signed or  executed.  In  addition,  he shall  perform all
     duties  incident to the office of the  President  and such other  duties as
     from time to time may be assigned to him.

     Section 9. Duties of the Vice Presidents.

     Each Vice  President  of the  Corporation  (including  any  Executive  Vice
     President and Senior Vice President)  shall have powers and duties that are
     customary for that office and such other powers and duties as may from time
     to time be assigned to him. Any Vice President of the  Corporation may sign
     and  execute  in the  name  of the  Corporation  deeds,  mortgages,  bonds,
     contracts  and other  instruments,  except in cases  where the  signing and
     execution thereof shall be expressly delegated by the Board of Directors or
     by these

 Page 51

     By-laws  to some  other  officer  or agent of the  Corporation  or shall be
     required by law otherwise to be signed or executed.

     Section 10. Duties of the Treasurer.

     The Treasurer  shall have charge and custody of and be responsible  for all
     funds and securities of the Corporation, and shall cause all such funds and
     securities to be deposited in such banks and  depositories  as the Board of
     Directors from time to time may direct. He shall maintain adequate accounts
     and records of all assets,  liabilities and transactions of the Corporation
     in accordance with generally accepted accounting  practices;  shall exhibit
     his accounts and records to any of the Directors of the  Corporation at any
     time upon  request  at the office of the  Corporation;  shall  render  such
     statements  of his  accounts and records and such other  statements  to the
     Board of  Directors  and officers as often and in such manner as they shall
     require;  and shall make and file (or  supervise  the making and filing of)
     all tax returns  required  by law.  He shall in general  perform all duties
     incident to the office of  Treasurer  and such other duties as from time to
     time may be assigned to him.

     Section 11. Duties of the Secretary.

     The  Secretary  shall  act as  secretary  of all  meetings  of the Board of
     Directors  and the  shareholders  of the  Corporation,  and shall  keep the
     minutes  thereof  in the  proper  book or  books  to be  provided  for that
     purpose.  He  shall  see  that  all  notices  required  to be  given by the
     Corporation  are duly given and served;  shall have  custody of the seal of
     the  Corporation  and shall affix the seal or cause it to be affixed to all
     certificates  for  stock  of  the  Corporation  and to  all  documents  the
     execution of which on behalf of the Corporation under its corporate seal is
     duly authorized in accordance  with the provisions of these By-laws;  shall
     have custody of all deeds, leases,  contracts and other important corporate
     documents;  shall  have  charge

 Page 52

     of the  books,  records  and  papers  of the  Corporation  relating  to its
     organization  and management as a Corporation;  shall see that the reports,
     statements  and other  documents  required by law (except tax  returns) are
     properly filed;  and shall, in general,  perform all the duties incident to
     the office of  Secretary  and such other duties as from time to time may be
     assigned to him.

     Section 12. Other Duties of Officers.

     Any  officer of the  Corporation  shall  have,  in  addition  to the duties
     prescribed  herein or by law,  such other duties as from time to time shall
     be prescribed.


                                    ARTICLE V

                                  Capital Stock

     Section 1. Certificates.

     The  shares of  capital  stock of the  Corporation  shall be  evidenced  by
     certificates in forms  prescribed by the Board of Directors and executed by
     the  Chief  Executive  Officer  or the  Chairman  of the  Board  and by the
     Secretary or an Assistant  Secretary  and stating  thereon the  information
     required by law.  Transfer agents and/or registrars for one or more classes
     of the stock of the  Corporation may be appointed by the Board of Directors
     and may be required to countersign certificates  representing stock of such
     class  or  classes.  In the  event  that any  officer  whose  signature  or
     facsimile thereof shall have been used on a stock certificate shall for any
     reason cease to be an officer of the Corporation and such certificate shall
     not then have been delivered by the Corporation, the Board of Directors may
     nevertheless adopt such certificate and it may then be issued and delivered
     as though such person had not ceased to be an officer of the Corporation.

 Page 53

     Section 2. Lost, Destroyed and Mutilated Certificates.

     Holders  of the  stock of the  Corporation  shall  immediately  notify  the
     Corporation  of any loss,  destruction  or  mutilation  of the  certificate
     therefor,  and the Board of Directors may, in its discretion,  cause one or
     more new  certificates for the same number of shares in the aggregate to be
     issued to such shareholder upon the surrender of the mutilated  certificate
     or upon satisfactory proof of such loss or destruction,  and the deposit of
     a bond in such  form  and  amount  and with  such  surety  as the  Board of
     Directors may require.

     Section 3. Transfer of Stock.

     The stock of the  Corporation  shall be  transferable or assignable only on
     the books of the  Corporation  by the  holders in person or by  attorney on
     surrender of the  certificate  for such shares duly endorsed and, if sought
     to be transferred  by attorney,  accompanied by a written power of attorney
     to  have  the  same  transferred  on  the  books  of the  Corporation.  The
     Corporation will recognize the exclusive right of the person  registered on
     its books as the owner of shares to receive  dividends  and to vote as such
     owner.

     Section 4. Fixing Record Date.

     For the  purpose of  determining  shareholders  entitled to notice of or to
     vote at any meeting of the  shareholders  or any  adjournment  thereof,  or
     entitled  to  receive  payment  for any  dividend,  or in  order  to make a
     determination  of shareholders  for any other proper purpose,  the Board of
     Directors  may  fix in  advance  a date as the  record  date  for any  such
     determination  of  shareholders,  such date in any case to be not more than
     seventy  (70)  days  prior  to the  date on which  the  particular  action,
     requiring such determination of shareholders,  is to be taken. If no record
     date is fixed for the  determination of shareholders  entitled to notice of
     or to vote at a  meeting  of  shareholders,  or  shareholders  entitled  to
     receive  payment of a dividend,

 Page 54

     the date on which  notice of the meeting is mailed or the date on which the
     resolution of the Board of Directors declaring such dividend is adopted, as
     the  case may be,  shall be the  record  date  for  such  determination  of
     shareholders.  Except as otherwise required by law, when a determination of
     shareholders  entitled to vote at any meeting of shareholders has been made
     as  provided  in  this  section  such  determination  shall  apply  to  any
     adjournment thereof.


                                   ARTICLE VI

                            Miscellaneous Provisions

     Section 1. Seal.

     The seal of the Corporation  shall consist of a flat-face  circular die, of
     which  there may be any number of  counterparts,  on which  there  shall be
     engraved in the center the words "Albemarle Corporation."

     Section 2. Fiscal Year.

     The fiscal year of the Corporation shall end on December 31st of each year.

     Section 3. Books and Records.

     The  Corporation  shall keep  correct  and  complete  books and  records of
     account and shall keep minutes of the proceedings of its  shareholders  and
     Board of Directors;  and shall keep at its  registered  office or principal
     place of business,  or at the office of its  transfer  agent or registrar a
     record  of  its  shareholders,  giving  the  names  and  addresses  of  all
     shareholders, and the number, class and series of the shares being held.

     Section 4. Checks, Notes and Drafts.

     Checks,  notes,  drafts and other  orders for the payment of money shall be
     signed  by such  persons  as the Board of  Directors  from time to time may
     authorize.  When  the  Board  of  Directors  so  authorizes,  however,  the
     signature of any such person may be a facsimile.

 Page 55

     Section 5. Amendment of By-laws.

     These  By-laws  may be amended  or  altered at any  meeting of the Board of
     Directors.  The shareholders entitled to vote in respect of the election of
     directors, however, shall have the power to rescind, alter, amend or repeal
     any By-laws and to enact By-laws which,  if expressly so provided,  may not
     be amended, altered or repealed by the Board of Directors.

     Section 6. Voting of Stock Held.

     The Chief  Executive  Officer,  the  Chairman  of the  Board or such  other
     officer or officers as may be  designated  by the Board of Directors or the
     Executive  Committee  shall  from  time  to time  appoint  an  attorney  or
     attorneys or agent or agents of this Corporation, in the name and on behalf
     of this  Corporation,  to cast  the  vote  which  this  Corporation  may be
     entitled to cast as a shareholder or otherwise in any other corporation any
     of whose stock or securities may be held in this  Corporation,  at meetings
     of the holders of the stock or other securities of such other  corporation,
     or to consent  in  writing to any action by any of such other  corporation,
     and shall  instruct  the person or persons so appointed as to the manner of
     casting  such votes or giving  such  consent and may execute or cause to be
     executed  on behalf of this  Corporation  and under its  corporate  seal or
     otherwise, such written proxies,  consents, waivers or other instruments as
     may  be  necessary  or  proper  in  the  premises;  or,  in  lieu  of  such
     appointment,  the Chief Executive Officer, the Chairman of the Board or any
     such  designated  officer or officers  may attend in person any meetings of
     the holders of stock or other securities of any such other  corporation and
     there vote or exercise any or all power of this  Corporation  as the holder
     of such stock or other securities of such other corporation.

 Page 56

     Section 7. Control Share Acquisition Statute.

     Article  14.1  of  the  Virginia  Stock  Corporation  Act  ("Control  Share
     Acquisitions")  shall not apply to  acquisitions  of shares of stock of the
     Corporation.


 Page 57


EXHIBIT 10.1
------------


                                CREDIT AGREEMENT

                         Dated as of September 10, 2002

                                      among

                             ALBEMARLE CORPORATION,
                                as the Borrower,

               THE SUBSIDIARIES OF THE BORROWER IDENTIFIED HEREIN,
                               as the Guarantors,

                            The Lenders Party Hereto,

                             BANK OF AMERICA, N.A.,
           as Administrative Agent, Swing Line Lender and L/C Issuer,

                            FORTIS (USA) FINANCE LLC,
                              as Syndication Agent

                                       and

                     SUNTRUST BANK AND THE BANK OF NEW YORK,
                           as Co-Documentation Agents


                                  Arranged By:

                         BANC OF AMERICA SECURITIES LLC,
                   as Sole Lead Arranger and Sole Book Manager









 Page 58


                                TABLE OF CONTENTS

Section                                                                   Page
--------                                                                  -----

Article I.        DEFINITIONS AND ACCOUNTING TERMS...........................1
         1.01     Defined Terms..............................................1
         1.02     Other Interpretive Provisions............ ................25
         1.03     Accounting Terms..........................................25
         1.04     Rounding..................................................26
         1.05     References to Agreements and Laws.........................26
         1.06     Times of Day..............................................26
         1.07     Letter of Credit Amounts..................................27
         1.08     Exchange Rates; Currency Equivalents......................27
         1.09     Additional Alternative Currencies.........................27
         1.10     Redenomination of Certain Alternative Currencies..........28

Article II.       THE COMMITMENTS AND CREDIT EXTENSIONS.....................28
         2.01     Committed Loans; Increase in Commitments..................28
         2.02     Borrowings, Conversions and Continuations of
                  Committed Loans...........................................29
         2.03     Letters of Credit.........................................31
         2.04     Swing Line Loans..........................................41
         2.05     Prepayments...............................................44
         2.06     Termination or Reduction of Commitments...................45
         2.07     Repayment of Loans........................................45
         2.08     Interest..................................................46
         2.09     Fees......................................................46
         2.10     Computation of Interest and Fees..........................49
         2.11     Evidence of Debt..........................................49
         2.12     Payments Generally........................................50
         2.13     Sharing of Payments.......................................52

Article III.      TAXES, YIELD PROTECTION AND ILLEGALITY....................53
         3.01     Taxes.....................................................53
         3.02     Illegality................................................55
         3.03     Inability to Determine Rates..............................55
         3.04     Increased Cost and Reduced Return; Capital Adequacy.......56
         3.05     Funding Losses............................................57
         3.06     Matters Applicable to all Requests for Compensation.......57
         3.07     Survival..................................................58

Article IV.       GUARANTY..................................................58
         4.01     The Guaranty..............................................58
         4.02     Obligations Unconditional.................................58
         4.03     Reinstatement.............................................60
         4.04     Certain Additional Waivers................................60
         4.05     Remedies..................................................60
         4.06     Rights of Contribution....................................60
         4.07     Guarantee of Payment; Continuing Guarantee................61

                                        i

 Page 59

Article V.        CONDITIONS PRECEDENT TO CREDIT EXTENSIONS.................62
         5.01     Conditions of Initial Credit Extension....................62
         5.02     Conditions to all Credit Extensions.......................63

Article VI.       REPRESENTATIONS AND WARRANTIES............................64
         6.01     Existence, Qualification and Power; Compliance with Laws..64
         6.02     Authorization; No Contravention...........................65
         6.03     Governmental Authorization; Other Consents................65
         6.04     Binding Effect............................................65
         6.05     Financial Statements......................................65
         6.06     Litigation................................................66
         6.07     No Default................................................66
         6.08     Ownership of Property; Liens..............................66
         6.09     Environmental Compliance..................................66
         6.10     Insurance.................................................67
         6.11     Taxes.....................................................67
         6.12     ERISA Compliance..........................................67
         6.13     Margin Regulations; Investment Company Act; Public Utility
                  Holding Company Act.......................................68
         6.14     Disclosure................................................69
         6.15     Compliance with Laws......................................69
         6.16     Intellectual Property; Licenses, Etc......................69

Article VII.      AFFIRMATIVE COVENANTS.....................................70
         7.01     Financial Statements......................................70
         7.02     Certificates; Other Information...........................71
         7.03     Notices...................................................72
         7.04     Payment of Obligations....................................73
         7.05     Preservation of Existence, Etc............................73
         7.06     Maintenance of Properties.................................73
         7.07     Maintenance of Insurance..................................74
         7.08     Compliance with Laws......................................74
         7.09     Books and Records.........................................74
         7.10     Inspection Rights.........................................74
         7.11     Use of Proceeds...........................................75
         7.12     Joinder of Guarantors.....................................75
         7.13     ERISA Compliance..........................................75

Article VIII.     NEGATIVE COVENANTS........................................75
         8.01     Liens.....................................................75
         8.02     Investments...............................................77
         8.03     Mergers, Dispositions, etc................................77
         8.04     Change in Nature of Business..............................78
         8.05     Transactions with Affiliates..............................78
         8.06     Use of Proceeds...........................................78
         8.07     Financial Covenants.......................................79
         8.08     ERISA.....................................................79

Article IX.       EVENTS OF DEFAULT AND REMEDIES............................79

                                       ii
 Page 60

         9.01     Events of Default.........................................79
         9.02     Remedies Upon Event of Default............................82
         9.03     Application of Funds......................................82

Article X.        ADMINISTRATIVE AGENT......................................83
         10.01    Appointment and Authorization of Administrative Agent.....83
         10.02    Delegation of Duties......................................84
         10.03    Liability of Administrative Agent.........................84
         10.04    Reliance by Administrative Agent..........................85
         10.05    Notice of Default.........................................85
         10.06    Credit Decision; Disclosure of Information by
                  Administrative Agent......................................86
         10.07    Indemnification of Administrative Agent...................86
         10.08    Administrative Agent in its Individual Capacity...........87
         10.09    Successor Administrative Agent............................87
         10.10    Administrative Agent May File Proofs of Claim.............88
         10.11    Guaranty Matters..........................................89
         10.12    Other Agents; Arrangers and Managers......................89

Article XI.       MISCELLANEOUS.............................................89
         11.01    Amendments, Etc...........................................89
         11.02    Notices and Other Communications; Facsimile Copies........91
         11.03    No Waiver; Cumulative Remedies............................92
         11.04    Attorney Costs, Expenses and Taxes........................93
         11.05    Indemnification by the Borrower...........................93
         11.06    Payments Set Aside........................................94
         11.07    Successors and Assigns....................................94
         11.08    Confidentiality...........................................97
         11.09    Set-off...................................................98
         11.10    Interest Rate Limitation..................................99
         11.11    Counterparts..............................................99
         11.12    Integration...............................................99
         11.13    Survival of Representations and Warranties...............100
         11.14    Severability.............................................100
         11.15    Tax Forms................................................100
         11.16    Replacement of Lenders...................................102
         11.17    Source of Funds..........................................103
         11.18    Governing Law............................................103
         11.19    Waiver of Right to Trial by Jury.........................104
         11.20    Judgment Currency........................................104

                                       iii
 Page 61
                                    SCHEDULES
                                    ---------

         1.01     Mandatory Cost Rate
         2.01     Commitments and Pro Rata Shares
         2.03     Existing Letters of Credit - none
         6.09     Environmental Matters - none
         8.01     Existing Liens - not attached
         11.02    Eurocurrency and Domestic Lending Offices; Notice Addresses


                                    EXHIBITS
                                    --------

         A        Form of Committed Loan Notice
         B        Form of Swing Line Loan Notice
         C        Form of Note
         D        Form of Compliance Certificate
         E        Form of Assignment and Assumption
         G        Form of Joinder Agreement
         H        Form of Lender Joinder Agreement

                                       iv

 Page 62


                                CREDIT AGREEMENT


     This  CREDIT  AGREEMENT  is entered  into as of  September  10,  2002 among
     ALBEMARLE  CORPORATION,  a  Virginia  corporation  (the  "Borrower"),   the
     Guarantors (defined herein), the Lenders (defined herein), BANK OF AMERICA,
     N.A., as  Administrative  Agent,  Swing Line Lender and L/C Issuer,  FORTIS
     (USA) FINANCE LLC, as Syndication  Agent, and SUNTRUST BANK and THE BANK OF
     NEW YORK, as Co-Documentation Agents.

     The  Borrower  has  requested  that the  Lenders  provide  $375,000,000  in
     revolving  credit  facilities,  and the Lenders are willing to do so on the
     terms and conditions set forth herein.

     In consideration of the mutual covenants and agreements  herein  contained,
     the parties hereto covenant and agree as follows:


                                   ARTICLE I.

                        DEFINITIONS AND ACCOUNTING TERMS

     1.01 Defined Terms.

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

     "Administrative   Agent"   means  Bank  of  America  in  its   capacity  as
     administrative  agent  under any of the Loan  Documents,  or any  successor
     administrative agent.

     "Administrative  Agent's Office" means,  with respect to any currency,  the
     Administrative Agent's address and, as appropriate, account as set forth on
     Schedule  11.02 with  respect  to such  currency  or such other  address or
     account with respect to such currency as the Administrative  Agent may from
     time to time notify the Borrower and the Lenders.

     "Administrative  Questionnaire" means an Administrative  Questionnaire in a
     form supplied by the Administrative Agent.

     "Adjusted  Eurocurrency Rate" means for any Interest Period with respect to
     any Eurocurrency Rate Loan, a rate per annum (rounded upward, if necessary,
     to the next 1/100th of 1%)  determined  by the  Administrative  Agent to be
     equal to the quotient  obtained by dividing (a) the  Eurocurrency  Rate for
     such  Eurocurrency  Loan for such  Interest  Period  by (b) one  minus  the
     Eurocurrency  Reserve  Percentage  for  such  Eurocurrency  Loan  for  such
     Interest Period.

                                        1
 Page 63

     "Affiliate"  means,  with  respect  to  any  Person,  another  Person  that
     directly, or indirectly through one or more intermediaries,  Controls or is
     Controlled  by or is  under  common  Control  with  the  Person  specified.
     "Control"  means the  possession,  directly or indirectly,  of the power to
     direct or cause the  direction of the  management  or policies of a Person,
     whether  through  the  ability to  exercise  voting  power,  by contract or
     otherwise.   "Controlling"  and  "Controlled"  have  meanings   correlative
     thereto.  Without limiting the generality of the foregoing,  a Person shall
     be  deemed  to be  Controlled  by  another  Person  if  such  other  Person
     possesses,  directly  or  indirectly,  power  to  vote  10% or  more of the
     securities  having  ordinary  voting power for the  election of  directors,
     managing general partners or the equivalent.

     "Agent-Related  Persons" means the Administrative  Agent, together with its
     Affiliates  (including,  in the case of Bank of America in its  capacity as
     the  Administrative  Agent,  the  Arranger),  and the officers,  directors,
     employees, agents and attorneys-in-fact of such Persons and Affiliates.

     "Aggregate  Commitments" means the Aggregate  Domestic  Commitments and the
     Aggregate Multicurrency Commitments.

     "Aggregate  Domestic  Commitments"  means the aggregate  amount of Domestic
     Commitments of all the Domestic  Lenders.  The initial  Aggregate  Domestic
     Commitment  is  referenced  in Section  2.01(a).  "Aggregate  Multicurrency
     Commitments" means the aggregate amount of Multicurrency Commitments of all
     the Multicurrency Lenders. The initial Aggregate  Multicurrency  Commitment
     is referenced in Section 2.01(b). "Agreement" means this Credit Agreement.

     "Alternative  Currency"  means each of British  Pounds  Sterling,  Canadian
     Dollars, Euro, Japanese Yen and Swiss Francs and each other lawful currency
     (other than Dollars) that is freely  available and freely  transferable and
     convertible  into  Dollars  and  that is  approved  by all the  Lenders  in
     accordance with Section 1.09.

     "Alternative  Currency  Equivalent" means, at any time, with respect to any
     amount  denominated  in  Dollars,  the  equivalent  amount  thereof  in the
     applicable  Alternative  Currency as determined by the Administrative Agent
     at such time on the basis of the Spot Rate  (determined  in  respect of the
     most recent Revaluation Date) for the purchase of such Alternative Currency
     with Dollars.

     "Applicable Currency" means Dollars or Alternative Currency, as applicable.

     "Applicable Rate" means,  from time to time, the following  percentages per
     annum, based upon the Debt Rating as set forth below (or, if no Debt Rating
     is issued by S&P or  Moody's,  then based  upon the Debt to  Capitalization
     Ratio as set forth below):

                                        2
 Page 64

                                                                                               

                                                            Applicable Rate
                                                                  for
                                            Debt to          Eurocurrency
 Pricing           Debt Rating          Capitalization      Rate Loans and     Rate for Base   Utilization  Facility
  Level            S&P/Moody's               Ratio        Letters of Credit     Rate Loans         Fee         Fee
----------- -------------------------- ------------------ ------------------- ---------------- ------------ ----------
    1            A/A2 or better              <15%               0.400%            0.000%         0.125%      0.100%
    2                 A-/A3             > 15% but <25%          0.500%            0.000%         0.125%      0.125%
    3               BBB+/Baa1           > 25% but <40%          0.600%            0.000%         0.125%      0.150%
    4               BBB/Baa2            > 40% but <50%          0.700%            0.000%         0.125%      0.175%
    5               BBB-/Baa3           > 50% but <60%          1.025%            0.025%         0.125%      0.225%
    6         worse than BBB-/Baa3           > 60%              1.200%            0.200%         0.250%      0.300%
----------- -------------------------- ------------------ ------------------- ---------------- ------------ ----------


     "Debt  Rating"  means,  as of any  date of  determination,  the  rating  as
     determined by either S&P or Moody's of the Borrower's  non-credit-enhanced,
     senior unsecured  long-term debt;  provided that if there is a split in the
     Debt  Rating of S&P and  Moody's,  then (a) in the case of a split  between
     Pricing  Levels 1, 2, 3, 4 and 5, the higher  (better) of such Debt Ratings
     shall apply and (b) in the case of a split between  Pricing Levels 5 and 6,
     the lower (worse) of such Debt Ratings shall apply.

     Initially, the Applicable Rate shall be determined based upon:

     (i) if  rated,  the Debt  Rating  specified  in the  certificate  delivered
     pursuant  to  Section  5.01(a)(viii).   Thereafter,   each  change  in  the
     Applicable  Rate  resulting  from a publicly  announced  change in the Debt
     Rating  shall be  effective,  in the case of an upgrade,  during the period
     commencing  on the date of delivery by the  Borrower to the  Administrative
     Agent of notice thereof  pursuant to Section 7.03(f) and ending on the date
     immediately  preceding the  effective  date of the next such change and, in
     the case of a downgrade,  during the period  commencing  on the date of the
     public  announcement  thereof and ending on the date immediately  preceding
     the effective date of the next such change.

     (ii)  if  unrated,  the  Debt  to  Capitalization  Ratio  specified  in the
     certificate delivered pursuant to Section 5.01(a)(viii).  Thereafter,  each
     change  in the  Applicable  Rate  resulting  from a  change  in the Debt to
     Capitalization  Ratio  shall be  effective  as of the  first  Business  Day
     immediately  following  the  date a  Compliance  Certificate  is  delivered
     pursuant  to  Section  7.02(b);  provided,  however,  that if a  Compliance
     Certificate is not delivered when due in accordance with such Section, then
     Pricing Level 6 shall apply as of the first

                                       3
 Page 65

     Business  Day  after  the date on which  such  Compliance  Certificate  was
     required to have been delivered  until the first  Business Day  immediately
     following  the  date  such  Compliance   Certificate  is  received  by  the
     Administrative Agent.

     Determinations by the Administrative Agent of the appropriate Pricing Level
     shall be conclusive absent manifest error.

     "Applicable  Time" means,  with respect to any  borrowings  and payments in
     Alternative Currencies, the local times in the place of settlement for such
     Alternative  Currencies as may be determined by the Administrative Agent to
     be necessary for timely  settlement on the relevant date in accordance with
     normal banking procedures in the place of payment.

     "Approved  Fund" means any Person (other than a natural person) that is (or
     will be) engaged in making,  purchasing,  holding or otherwise investing in
     commercial loans and similar extensions of credit in the ordinary course of
     its business and that is  administered  or managed by (a) a Lender,  (b) an
     Affiliate  of a Lender or (c) an entity or an  Affiliate  of an entity that
     administers or manages a Lender.

     "Arranger"  means Banc of America  Securities  LLC, in its capacity as sole
     lead arranger and sole book manager.

     "Assignment   and   Assumption"   means  an   Assignment   and   Assumption
     substantially in the form of Exhibit E.

     "Attorney  Costs"  means and  includes all  reasonable  fees,  expenses and
     disbursements of any law firm or other external counsel and,  following the
     occurrence and during the  continuation of an Event of Default,  shall also
     include the allocated  cost of internal legal services and all expenses and
     disbursements of internal counsel.

     "Attributable  Principal  Amount" means (a) in the case of capital  leases,
     the amount of capital lease obligations determined in accordance with GAAP,
     (b) in the case of Synthetic Leases, an amount determined by capitalization
     of the remaining  lease  payments  thereunder as if it were a capital lease
     determined  in  accordance  with  GAAP,  (c) in the case of  Securitization
     Transactions,  the outstanding  principal  amount of such financing,  after
     taking into account reserve accounts and making appropriate adjustments, as
     determined by the Administrative  Agent in its reasonable  judgment and (d)
     in the case of any Sale and  Lease  Back  Transaction,  the  present  value
     (discounted  in  accordance  with  GAAP at the  debt  rate  implied  in the
     applicable  lease) of the  obligations  of the lessee  for rental  payments
     during the term of such lease.  "Availability Period" means the period from
     and  including  the Closing Date to the earliest of (a) the Maturity  Date,
     (b) the  date of  termination  of the  Aggregate  Commitments  pursuant  to
     Section 2.06,  and (c) the date of  termination  of the  commitment of each
     Lender to make  Loans and of the  obligation  of the L/C Issuer to make L/C
     Credit Extensions pursuant to Section 9.02.

                                       4
 Page 66

     "Bank of America" means Bank of America, N.A. and its successors.

     "Base Rate" means for any day a fluctuating rate per annum (rounded upward,
     if  necessary,  to the next  1/100th  of 1%) equal to the higher of (a) the
     Federal  Funds Rate plus 1/2 of 1% and (b) the rate of  interest  in effect
     for such day as publicly  announced from time to time by Bank of America as
     its "prime  rate." The "prime rate" is a rate set by Bank of America  based
     upon various factors  including Bank of America's costs and desired return,
     general economic  conditions and other factors,  and is used as a reference
     point for pricing some loans,  which may be priced at, above, or below such
     announced rate. Any change in the "prime rate" announced by Bank of America
     shall take effect at the opening of  business on the day  specified  in the
     public announcement of such change.

     "Base Rate Loan" means a Loan that bears interest based on the Base Rate.

     "Borrower" has the meaning specified in the introductory paragraph hereto.

     "Borrowing" means a Committed  Borrowing or a Swing Line Borrowing,  as the
     context may require.

     "Business Day" means any day other than a Saturday,  Sunday or other day on
     which commercial banks are authorized to close under the Laws of, or are in
     fact  closed in, the state  where the  Administrative  Agent's  Office with
     respect to  Obligations  denominated  in Dollars is located and (a) if such
     day relates to any  Eurocurrency  Rate Loan denominated in a currency other
     than Euro, means any such day on which dealings in deposits in the relevant
     currency  are  conducted  by and  between  banks  in the  London  or  other
     applicable  offshore  interbank market for such currency or (b) if such day
     relates to any  Eurocurrency  Rate Loan denominated in Euro, means a TARGET
     Day.

     "Cash Collateralize" has the meaning specified in Section 2.03(g).

     "Change  of  Control"  means an event or  series of events by which (a) any
     "person" or "group" (as such terms are used in Sections  13(d) and 14(d) of
     the Securities  Exchange Act of 1934) other than Floyd D. Gottwald,  Jr. or
     members  of his  family  (together,  the  "Gottwalds"),  or any  investment
     entities owned by them,  shall own directly or indirectly,  beneficially or
     of record,  shares  representing  more than the greater of (i) 20% and (ii)
     the  percentage  owned by the  Gottwalds of the aggregate  ordinary  voting
     power  represented  by the  issued  and  outstanding  capital  stock of the
     Borrower or any Person directly or indirectly  Controlling the Borrower; or
     (b) a  majority  of the seats  (other  than  vacant  seats) on the board of
     directors of the Borrower or any Person directly or indirectly  Controlling
     the Borrower  shall at any time be occupied by persons who were neither (i)
     nominated by the  management of the Borrower or by persons who were members
     of the board of directors as of the Closing Date or members  elected by two
     thirds of such members, nor (ii) appointed by directors so nominated.

                                       5
 Page 67

     "Closing Date" means the date hereof.

     "Commitment"   means  the  Domestic   Commitment   and  the   Multicurrency
     Commitment.

     "Committed   Borrowing"   means  a  Domestic   Committed   Borrowing  or  a
     Multicurrency Committed Borrowing, as appropriate.

     "Committed  Loan"  means  a  Domestic  Committed  Loan  or a  Multicurrency
     Committed Loan, as appropriate.

     "Committed Loan Notice" means a notice of (a) a Committed Borrowing,  (b) a
     conversion  of  Committed  Loans  from  one  Type  to the  other,  or (c) a
     continuation  of  Eurocurrency  Rate Loans,  pursuant  to Section  2.02(a),
     which, if in writing, shall be substantially in the form of Exhibit A.

     "Compliance  Certificate" means a certificate  substantially in the form of
     Exhibit D.

     "Consolidated EBITDA" means, for any period, for the Consolidated Group, an
     amount equal to Consolidated  Net Income for such period plus the following
     to the extent deducted in calculating  such  Consolidated  Net Income:  (a)
     Consolidated  Interest  Charges  for such  period,  (b) the  provision  for
     federal,  state, local and foreign income taxes payable by the Consolidated
     Group for such period and (c) the amount of depreciation  and  amortization
     expense for such period.

     "Consolidated  Funded  Debt" means  Funded Debt of the  Consolidated  Group
     determined on a consolidated  basis in accordance with GAAP.  "Consolidated
     Group" means the Borrower and its  consolidated  Subsidiaries as determined
     in accordance with GAAP.

     "Consolidated Interest Charges" means, for any period, for the Consolidated
     Group,  all interest  expense,  including the amortization of debt discount
     and premium,  the interest  component  under capital leases and the implied
     interest  component under  Securitization  Transactions,  in each case on a
     consolidated basis determined in accordance with GAAP.

     "Consolidated   Interest   Coverage   Ratio"  means,  as  of  any  date  of
     determination,  the ratio of (a) Consolidated  EBITDA for the period of the
     four prior fiscal quarters ending on such date to (b) Consolidated Interest
     Charges for such period.

     "Consolidated  Leverage Ratio" means, as of any date of determination,  the
     ratio of (a)  Consolidated  Funded Debt as of such date to (b) Consolidated
     EBITDA for the period of the four fiscal  quarters most recently  ended for
     which the Borrower has delivered  financial  statements pursuant to Section
     7.01(a) or (b).

                                       6
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     "Consolidated Net Income" means, for any period for the Consolidated Group,
     the net income of the Consolidated Group (excluding extraordinary items and
     related tax effects) for that period.

     "Consolidated   Net  Worth"  means,  as  of  any  date  of   determination,
     consolidated shareholders' equity of the Consolidated Group as of that date
     determined in accordance with GAAP (excluding, for purposes hereof, changes
     in the cumulative foreign currency  translation  adjustment and any mark to
     market of a  derivative  or  hedging  instrument  (or any other  adjustment
     related thereto) required under FAS 133).

     "Consolidated  Tangible  Domestic  Assets" means, as of any date, the total
     book  value  of  assets  of  members  of the  Consolidated  Group  that are
     organized under the laws of any political subdivision of the United States,
     which assets are located in the United States, minus (i) intercompany loans
     and advances from such members of the  Consolidated  Group to other members
     of the Consolidated  Group and (ii) the book value of intangible  assets of
     such members of the Consolidated Group, including goodwill,  patents, trade
     names,   trademarks,   copyrights,   franchises,    experimental   expense,
     organizational expense,  unamortized debt discount and expense and deferred
     assets  (other than prepaid  insurance  and prepaid  taxes),  determined in
     accordance with GAAP.

     "Contractual  Obligation"  means,  as to any Person,  any  provision of any
     security  issued by such Person or of any  agreement,  instrument  or other
     undertaking  to which  such  Person is a party or by which it or any of its
     property is bound.

     "Control" has the meaning specified in the definition of "Affiliate."

     "Credit Extension" means each of the following:  (a) a Borrowing and (b) an
     L/C Credit Extension.

     "Debt Rating" has the meaning set forth in the  definition  of  "Applicable
     Rate."

     "Debt to Capitalization Ratio" means, as of any date of determination,  the
     ratio of (a)  Consolidated  Funded  Debt as of such  date to (b) the sum of
     Consolidated Net Worth as of such date plus Consolidated  Funded Debt as of
     such date.

     "Debtor  Relief Laws" means the Bankruptcy  Code of the United States,  and
     all other  liquidation,  conservatorship,  bankruptcy,  assignment  for the
     benefit of creditors, moratorium, rearrangement,  receivership, insolvency,
     reorganization, or similar debtor relief Laws of the United States or other
     applicable  jurisdictions  from time to time in effect  and  affecting  the
     rights of creditors generally.

     "Default" means any event or condition that constitutes an Event of Default
     or that, with the giving of any notice, the passage of time, or both, would
     be an Event of Default.

     "Default  Rate" means an interest  rate equal to (a) the Base Rate plus (b)
     the Applicable Rate, if any,  applicable to Base Rate Loans plus (c) 2% per
     annum;  provided,  however,

                                       7
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     that with respect to a Eurocurrency Rate Loan, the Default Rate shall be an
     interest rate equal to the interest rate  (including any  Applicable  Rate)
     otherwise  applicable  to such Loan plus 2% per annum,  in each case to the
     fullest extent permitted by applicable Laws.

     "Defaulting  Lender"  means  any  Lender  that (a) has  failed  to fund any
     portion  of the  Committed  Loans,  participations  in L/C  Obligations  or
     participations  in Swing Line Loans  required to be funded by it  hereunder
     within one Business Day of the date  required to be funded by it hereunder,
     (b) has  otherwise  failed to pay over to the  Administrative  Agent or any
     other  Lender any other amount  required to be paid by it hereunder  within
     one Business  Day of the date when due,  unless the subject of a good faith
     dispute,  or (c) has been  deemed  insolvent  or become  the  subject  of a
     bankruptcy or insolvency proceeding.

     "Disposition"  or "Dispose"  means the sale,  transfer,  license,  lease or
     other  disposition  (including any Sale and Leaseback  Transaction)  of any
     property by any Person,  including any sale, assignment,  transfer or other
     disposal,  with or without recourse, of any notes or accounts receivable or
     any rights and claims associated therewith.

     "Dollar" and "$" mean lawful money of the United States.

     "Dollar  Equivalent"  means,  at any time,  (a) with  respect to any amount
     denominated  in Dollars,  such  amount,  and (b) with respect to any amount
     denominated in any Alternative  Currency,  the equivalent amount thereof in
     Dollars as determined by the Administrative Agent at such time on the basis
     of the Spot Rate  (determined  in  respect of the most  recent  Revaluation
     Date) for the purchase of Dollars with such Alternative Currency.

     "Domestic  Commitment" means, as to each Domestic Lender, the commitment of
     such Lender to make Domestic Committed Loans and to participate in Domestic
     L/C  Obligations and Swing Line Loans in an aggregate  principal  amount at
     any one  time  outstanding  not to  exceed  the  amount  set  forth as such
     Domestic  Lender's  "Domestic   Commitment"  on  Schedule  2.01.  "Domestic
     Committed Loans" has the meaning provided in Section 2.01(a).

     "Domestic Committed Borrowing" means a borrowing consisting of simultaneous
     Domestic  Committed Loans of the same Type and, in the case of Eurocurrency
     Rate Loans,  having the same  Interest  Period made by each of the Domestic
     Lenders as provided herein.

     "Domestic L/C Advance" means,  with respect to each Domestic  Lender,  such
     Lender's funding of its participation in a Domestic L/C Borrowing.

     "Domestic  L/C  Borrowing"  means an extension of credit  resulting  from a
     drawing under any Domestic Letter of Credit that has not been reimbursed on
     the  date  when  made or  refinanced  as a  Domestic  Committed  Borrowing.

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     "Domestic  L/C Issuer"  means Bank of America in its  capacity as issuer of
     the Domestic Letters of Credit, and its successors in such capacity.

     "Domestic  L/C  Obligations"  means  as of any date of  determination,  the
     aggregate  undrawn amount of all  outstanding  Domestic  Letters of Credit,
     plus the  aggregate  amount  of all  Unreimbursed  Amounts  in  respect  of
     Domestic Letters of Credit, including Domestic L/C Borrowings.

     "Domestic  Lenders"  means each of the Lenders  with  Domestic  Commitments
     hereunder.

     "Domestic  Letter of  Credit"  means (i) those  Existing  Letters of Credit
     identified  as "Domestic  Letters of Credit" on Schedule  2.03 and (ii) any
     letter of credit issued under the Domestic Commitments under the provisions
     of Section 2.03(a). Domestic Letters of Credit may be commercial letters of
     credit or standby letters of credit.

     "Domestic Letter of Credit Sublimit" shall have the meaning given such term
     in Section 2.03(a)(i).

     "Domestic Loan Obligations"  means Domestic  Committed Loans,  Domestic L/C
     Obligations and Swing Line Loans.

     "Domestic Pro Rata Share" means,  with respect to each Domestic  Lender,  a
     fraction (expressed as percentage, carried out to the ninth decimal place),
     the  numerator  of which is the amount of the Domestic  Commitment  of such
     Lender  at such  time and the  denominator  of which is the  amount  of the
     Aggregate Domestic  Commitments at such time; provided that if the Domestic
     Commitments  shall have been terminated  pursuant to Section 9.02, then the
     Domestic  Pro Rata Share of each Lender  shall be  determined  based on the
     Domestic Pro Rata Share of such Domestic Lender  immediately  prior to such
     termination  and after giving  effect to any  subsequent  assignments  made
     pursuant to the terms hereof.  The initial  Domestic Pro Rata Share of each
     Domestic Lender is set forth as such Domestic  Lender's  "Domestic Pro Rata
     Share" on Schedule 2.01.

     "Domestic Subsidiary" means any Subsidiary that is organized under the laws
     of any political subdivision of the United States.

     "Eligible Assignee" means (a) a Lender; (b) an Affiliate of a Lender (other
     than an Affiliate  that is a Foreign  Lender);  (c) an Approved Fund (other
     than an Approved Fund that is a Foreign  Lender);  and (d) any other Person
     (other than a natural person) approved by (i) the Administrative Agent, the
     L/C Issuer and the Swing Line  Lender,  and (ii) unless an Event of Default
     has occurred and is continuing,  the Borrower (each such approval not to be
     unreasonably withheld or delayed,  provided that it shall be reasonable for
     the  Borrower  to  withhold  consent if such Person does not provide to the
     Borrower the information required under Section 11.15). Notwithstanding the
     foregoing, "Eligible Assignee" shall not include the Borrower or any of the
     Borrower's Affiliates or Subsidiaries.

                                       9
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     "EMU" means the economic and monetary  union in accordance  with the Treaty
     of Rome 1957, as amended by the Single  European Act 1986,  the  Maastricht
     Treaty of 1992 and the  Amsterdam  Treaty of 1998,  as amended from time to
     time.

     "EMU  Legislation"  means the legislative  measures of the European Council
     for the introduction of,  changeover to or operation of a single or unified
     European currency (whether known as the "euro" or otherwise).

     "Environmental  Laws" means any and all federal,  state, local, and foreign
     statutes, laws, regulations, ordinances, rules, judgments, orders, decrees,
     permits,   concessions,   grants,  franchises,   licenses,   agreements  or
     governmental  restrictions  relating to pollution and the protection of the
     environment or the release of any materials into the environment, including
     those  related  to  hazardous  substances  or  wastes,  air  emissions  and
     discharges to waste or public systems.

     "Environmental  Liability"  means any  liability,  contingent  or otherwise
     (including any liability for damages,  costs of environmental  remediation,
     fines, penalties or indemnities),  of the Borrower, any other Loan Party or
     any of their respective  Subsidiaries directly or indirectly resulting from
     or based upon (a) violation of any  Environmental  Law, (b) the generation,
     use,  handling,  transportation,  storage,  treatment  or  disposal  of any
     Hazardous  Materials,  (c)  exposure to any  Hazardous  Materials,  (d) the
     release  or  threatened  release  of  any  Hazardous   Materials  into  the
     environment or (e) any contract,  agreement or other consensual arrangement
     pursuant to which  liability  is assumed or imposed  with respect to any of
     the foregoing.

     "ERISA" means the Employee Retirement Income Security Act of 1974.

     "ERISA Affiliate" means any trade or business (whether or not incorporated)
     under common control with the Borrower within the meaning of Section 414(b)
     or (c) of the  Internal  Revenue Code (and  Sections  414(m) and (o) of the
     Internal Revenue Code for purposes of provisions relating to Section 412 of
     the Internal Revenue Code).

     "ERISA Event" means (a) a Reportable  Event with respect to a Pension Plan;
     (b) a withdrawal by the Borrower or any ERISA Affiliate from a Pension Plan
     subject  to  Section  4063 of ERISA  during  a plan  year in which it was a
     substantial  employer  (as  defined  in Section  4001(a)(2)  of ERISA) or a
     cessation of operations that is treated as such a withdrawal  under Section
     4062(e) of ERISA;  (c) a complete or partial  withdrawal by the Borrower or
     any  ERISA  Affiliate  from a  Multiemployer  Plan or  notification  that a
     Multiemployer  Plan is in  reorganization;  (d) the  filing  of a notice of
     intent to  terminate,  the  treatment of a Plan  amendment as a termination
     under Sections 4041 or 4041A of ERISA,  or the  commencement of proceedings
     by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e) an event
     or condition that  constitutes  grounds under Section 4042 of ERISA for the
     termination of, or the appointment of a trustee to administer,  any Pension
     Plan or  Multiemployer  Plan; or (f) the imposition of any liability

                                       10
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     under  Title  IV of  ERISA,  other  than  for  PBGC  premiums  due  but not
     delinquent  under  Section  4007 of ERISA,  upon the  Borrower or any ERISA
     Affiliate.

     "Euro" and "EUR"  mean the  lawful  currency  of the  Participating  Member
     States introduced in accordance with the EMU Legislation.

     "Eurocurrency Rate" means, for such Interest Period:

     (a) the rate per annum (rounded upward,  if necessary,  to the next 1/100th
     of 1%) equal to the rate determined by the  Administrative  Agent to be the
     offered  rate  that  appears  on the page of the  Telerate  screen  (or any
     successor  thereto) that displays an average  British  Bankers  Association
     Interest  Settlement  Rate  for  deposits  in the  relevant  currency  (for
     delivery on the first day of such Interest  Period) with a term  equivalent
     to such Interest Period,  determined as of approximately 11:00 a.m. (London
     time) two Business Days prior to the first day of such Interest Period, or

     (b) if the rate  referenced in the preceding  clause (a) does not appear on
     such page or service or such page or service  shall not be  available,  the
     rate per annum (rounded  upward,  if necessary,  to the next 1/100th of 1%)
     equal to the rate determined by the Administrative  Agent to be the offered
     rate on such other page or other service that  displays an average  British
     Bankers  Association  Interest Settlement Rate for deposits in the relevant
     currency  (for  delivery on the first day of such  Interest  Period) with a
     term  equivalent to such Interest  Period,  determined as of  approximately
     11:00 a.m.  (London  time) two Business Days prior to the first day of such
     Interest Period, or

     (c) if the rates  referenced in the  preceding  clauses (a) and (b) are not
     available,  the rate per annum (rounded upward,  if necessary,  to the next
     1/100th  of 1%)  determined  by the  Administrative  Agent  as the  rate of
     interest at which  deposits in relevant  currency for delivery on the first
     day of such Interest Period in same day funds in the approximate  amount of
     the  Eurocurrency  Rate Loan being made,  continued or converted by Bank of
     America and with a term equivalent to such Interest Period would be offered
     by Bank of America's  London  Branch or London  Affiliate to major banks in
     the  offshore  interbank  market  for such  currency  at their  request  at
     approximately 11:00 a.m. (London time) two Business Days prior to the first
     day of such Interest Period.

     "Eurocurrency  Rate Loan" means a Committed  Loan that bears  interest at a
     rate based on the Adjusted Eurocurrency Rate.

     "Eurocurrency  Reserve  Percentage"  means, for any day during any Interest
     Period, the reserve percentage (expressed as a decimal, carried out to five
     decimal  places) in effect on such day,  whether or not  applicable  to any
     particular  Lender,  under regulations  issued from time to time by the FRB
     for determining the maximum reserve  requirement  (including any emergency,
     supplemental  or  other  marginal  reserve

                                       11
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     requirement) with respect to Eurocurrency funding (currently referred to as
     "Eurocurrency  liabilities").  The  Adjusted  Eurocurrency  Rate  for  each
     outstanding  Eurocurrency  Rate Loan shall be adjusted  automatically as of
     the effective date of any change in the Eurocurrency Reserve Percentage.

     "Event of Default" has the meaning specified in Section 9.01.

     "Existing  Credit  Agreement"  means the Competitive  Advance and Revolving
     Credit  Facility  Agreement  dated  as of  September  24,  1996  among  the
     Borrower, the banks named therein,  NationsBank, N.A. (now known as Bank of
     America,  N.A.), as Administrative Agent, and Bank of America Illinois (now
     known  as Bank of  America,  N.A.),  The  Bank of New  York  and The  Chase
     Manhattan  Bank (now  known as  JPMorgan  Chase  Bank),  as  Co-Agents,  as
     amended.

     "Existing Letters of Credit" means the letters of credit outstanding on the
     Closing Date and identified on Schedule 2.03.

     "Federal  Funds  Rate"  means,  for any day,  the rate per  annum  (rounded
     upward,  if  necessary,  to the next  1/100th of 1%) equal to the  weighted
     average of the rates on overnight  federal funds  transactions with members
     of the Federal  Reserve  System  arranged by federal  funds brokers on such
     day, as  published  by the Federal  Reserve  Bank on the  Business Day next
     succeeding  such day;  provided that (a) if such day is not a Business Day,
     the Federal Funds Rate for such day shall be such rate on such transactions
     on the next preceding  Business Day as so published on the next  succeeding
     Business  Day,  and  (b) if no  such  rate is so  published  on  such  next
     succeeding  Business  Day, the Federal Funds Rate for such day shall be the
     average rate  (rounded  upward,  if  necessary,  to the next 1/100th of 1%)
     charged to Bank of America on such day on such  transactions  as determined
     by the Administrative Agent.

     "Fee Letter"  means the letter  agreement,  dated July 15, 2002,  among the
     Borrower, the Administrative Agent and the Arranger.

     "Foreign Lender" has the meaning specified in Section 11.15(a)(i).

     "FRB" means the Board of  Governors  of the Federal  Reserve  System of the
     United States.

     "Funded  Debt"  means,  as to any  Person  at a  particular  time,  without
     duplication,  all of the following, whether or not included as indebtedness
     or liabilities in accordance  with GAAP:

     (a) all  obligations  for  borrowed  money,  whether  current or  long-term
     (including the Obligations  hereunder),  and all  obligations  evidenced by
     bonds, debentures, notes, loan agreements or other similar instruments;

     (b) all purchase money indebtedness (including indebtedness and obligations
     in respect of conditional  sales and title retention  arrangements,  except
     for

                                       12
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     customary conditional sales and title retention arrangements with suppliers
     that  are  entered  into  in the  ordinary  course  of  business)  and  all
     indebtedness  and obligations in respect of the deferred  purchase price of
     property  or services  (other  than trade  accounts  payable  incurred  the
     ordinary course of business and payable on customary trade terms);

     (c) all direct  obligations under letters of credit (including  standby and
     commercial),  bankers'  acceptances,  bank  guaranties,  surety  bonds  and
     similar instruments;

     (d) the  Attributable  Principal  Amount of capital  leases  and  Synthetic
     Leases;

     (e) the Attributable Principal Amount of Securitization Transactions;

     (f) all  preferred  stock and  comparable  equity  interests  providing for
     mandatory  redemption,  sinking  fund or other like  payments  within three
     years of the date thereof;

     (g) Guarantees in respect of Funded Debt of another Person;

     (h) Funded Debt of any partnership or joint venture or other similar entity
     in which such Person is a general partner or joint venturer,  and, as such,
     has personal  liability for such obligations,  but only to the extent there
     is recourse to such Person for payment thereof.

     For purposes hereof, the amount of Funded Debt shall be determined based on
     the outstanding principal amount in the case of borrowed money indebtedness
     under clause (a) and purchase money  indebtedness and the deferred purchase
     obligations  under clause (b), based on the maximum amount  available to be
     drawn in the case of letter of credit obligations and the other obligations
     under clause (c), and based on the outstanding  principal  amount of Funded
     Debt that is the subject of the Guarantees in the case of Guarantees  under
     clause (g).

     "GAAP" means generally accepted accounting  principles in the United States
     as in effect from time to time set forth in the opinions and pronouncements
     of the Accounting  Principles Board and the American Institute of Certified
     Public  Accountants  and  statements  and  pronouncements  of the Financial
     Accounting Standards Board, subject to the provisions of Section 1.03.

     "Governmental Authority" means any nation or government, any state or other
     political  subdivision  thereof,  any agency,  authority,  instrumentality,
     regulatory  body,  court,  administrative  tribunal,  central bank or other
     entity exercising executive,  legislative,  judicial, taxing, regulatory or
     administrative powers or functions of or pertaining to government.

                                       13
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     "Guarantee" means, as to any Person, any (a) any obligation,  contingent or
     otherwise,  of such Person  guaranteeing  or having the economic  effect of
     guaranteeing any Indebtedness or other obligation payable or performable by
     another Person (the "primary  obligor") in any manner,  whether directly or
     indirectly,  and  including  any  obligation  of  such  Person,  direct  or
     indirect,  (i) to  purchase  or pay (or  advance  or  supply  funds for the
     purchase  or payment of) such  Indebtedness  or other  obligation,  (ii) to
     purchase  or lease  property,  securities  or  services  for the purpose of
     assuring the obligee in respect of such Indebtedness or other obligation of
     the payment or performance of such Indebtedness or other obligation,  (iii)
     to  maintain  working  capital,  equity  capital  or  any  other  financial
     statement  condition  or  liquidity  or level of income or cash flow of the
     primary   obligor  so  as  to  enable  the  primary  obligor  to  pay  such
     Indebtedness or other  obligation,  or (iv) entered into for the purpose of
     assuring in any other manner the obligee in respect of such Indebtedness or
     other  obligation of the payment or performance  thereof or to protect such
     obligee  against loss in respect  thereof (in whole or in part), or (b) any
     Lien on any  assets  of such  Person  securing  any  Indebtedness  or other
     obligation of any other Person,  whether or not such  Indebtedness or other
     obligation is assumed by such Person.  The amount of any Guarantee shall be
     deemed to be an amount  equal to the stated or  determinable  amount of the
     related primary  obligation,  or portion thereof,  in respect of which such
     Guarantee is made or, if not stated or determinable, the maximum reasonably
     anticipated  liability in respect thereof as determined by the guaranteeing
     Person in good faith.  The term  "Guarantee" as a verb has a  corresponding
     meaning.

     "Guarantors"  means each  Person  that  joins as a  Guarantor  pursuant  to
     Section 7.12, together with their successors and permitted assigns.

     "Hazardous  Materials"  means all  explosive or  radioactive  substances or
     wastes and all hazardous or toxic  substances,  wastes or other pollutants,
     including    petroleum    or    petroleum    distillates,    asbestos    or
     asbestos-containing   materials,   polychlorinated  biphenyls,  radon  gas,
     infectious  or  medical  wastes and all other  substances  or wastes of any
     nature regulated pursuant to any Environmental Law.

     "Indebtedness"  means,  as to any  Person  at a  particular  time,  without
     duplication,  all of the following, whether or not included as indebtedness
     or liabilities in accordance with GAAP:

     (a) all Funded Debt;

     (b) all contingent  obligations under letters of credit (including  standby
     and commercial letters of credit),  bankers' acceptances,  bank guaranties,
     surety bonds and similar instruments;

     (c) net obligations under any Swap Contract;

     (d) Guarantees in respect of Indebtedness of another Person; and

                                       14
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     (e)  Indebtedness  of any  partnership  or joint  venture or other  similar
     entity in which such Person is a general partner or joint venturer, and, as
     such, has personal  liability for such obligations,  but only to the extent
     there is recourse to such Person for payment thereof.

     For purposes hereof,  the amount of Indebtedness  shall be determined based
     on Swap  Termination  Value  in the  case  of net  obligations  under  Swap
     Contracts under clause (c) and based on the outstanding principal amount of
     Indebtedness  that  is  the  subject  of the  Guarantees  in  the  case  of
     Guarantees under clause (d).

     "Indemnified Liabilities" has the meaning set forth in Section 11.05.

     "Indemnitees" has the meaning set forth in Section 11.05.

     "Interest  Payment  Date"  means (a) as to any Loan  other than a Base Rate
     Loan, the last day of each Interest Period  applicable to such Loan and the
     Maturity  Date;  provided,  however,  that  if any  Interest  Period  for a
     Eurocurrency Rate Loan exceeds three months, the respective dates that fall
     every three months after the beginning of such  Interest  Period shall also
     be Interest  Payment Dates;  and (b) as to any Base Rate Loan  (including a
     Swing Line Loan), the last Business Day of each March, June,  September and
     December and the Maturity Date.

     "Internal Revenue Code" means the Internal Revenue Code of 1986.

     "Interest  Period"  means,  as to each  Eurocurrency  Rate Loan, the period
     commencing  on the  date  such  Eurocurrency  Rate  Loan  is  disbursed  or
     converted  to or continued  as a  Eurocurrency  Rate Loan and ending on the
     date one, two, three or six months thereafter,  as selected by the Borrower
     in its Committed Loan Notice; provided that:

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

     (b) any Interest  Period that begins on the last Business Day of a calendar
     month (or on a day for which there is no numerically  corresponding  day in
     the calendar  month at the end of such  Interest  Period)  shall end on the
     last Business Day of the calendar month at the end of such Interest Period;
     and

     (c) no Interest Period shall extend beyond the Maturity Date.

     "Investment" means, as to any Person, any direct or indirect acquisition or
     investment  by such  Person,  whether by means of (a) the purchase or other
     acquisition of capital stock or other  securities of another Person,  (b) a
     loan,  advance or capital  contribution to, Guarantee or assumption of debt
     of,  or  purchase  or  other  acquisition  of  any  other  debt  or  equity
     participation or interest in, another Person,  including any partnership or

                                       15
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     joint venture  interest in such other Person,  or (c) the purchase or other
     acquisition (in one transaction or a series of  transactions)  of assets of
     another  Person that  constitute a business  unit. For purposes of covenant
     compliance,  the  amount of any  Investment  shall be the  amount  actually
     invested,  without adjustment for subsequent  increases or decreases in the
     value of such Investment.

     "IP Rights" has the meaning set forth in Section 6.16.

     "IRS" means the United States Internal Revenue Service.

     "Joinder Agreement" means a joinder agreement  substantially in the form of
     Exhibit G executed  and  delivered  by a Material  Domestic  Subsidiary  in
     accordance with the provisions of Section 7.12.

     "Laws" means, collectively, all international,  foreign, federal, state and
     local statutes, treaties, rules, guidelines, regulations, ordinances, codes
     and  administrative  or judicial  precedents or authorities,  including the
     interpretation  or  administration  thereof by any  Governmental  Authority
     charged with the enforcement, interpretation or administration thereof, and
     all applicable administrative orders, directed duties, requests,  licenses,
     authorizations  and  permits  of, and  agreements  with,  any  Governmental
     Authority, in each case whether or not having the force of law.

     "L/C Advance" means a Domestic L/C Advance or a Multicurrency  L/C Advance,
     as appropriate.

     "L/C  Borrowing"   means  a  Domestic  L/C  Borrowing  or  a  Multicurrency
     Borrowing, as appropriate.

     "L/C Credit  Extension"  means,  with respect to any Letter of Credit,  the
     issuance thereof or extension of the expiry date thereof, or the renewal or
     increase of the amount thereof.

     "L/C Issuer" means the Domestic L/C Issuer or the Multicurrency L/C Issuer,
     as appropriate.

     "L/C  Obligations"  means the Domestic L/C Obligations or the Multicurrency
     L/C Obligations, as appropriate.

     "Lender"  means  each  of  the  Persons  identified  as a  "Lender"  on the
     signature pages hereto and their successors and assigns and, as the context
     requires, includes the L/C Issuer and the Swing Line Lender.

     "Lender Joinder  Agreement" means a joinder agreement  substantially in the
     form of Exhibit H executed and delivered in accordance  with the provisions
     of Section 2.01(c).

                                       16
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     "Lending  Office"  means,  as to any Lender,  the office or offices of such
     Lender described as such in such Lender's Administrative Questionnaire,  or
     such other  office or offices as a Lender may from time to time  notify the
     Borrower and the Administrative Agent.

     "Letter of Credit"  means a  Domestic  Letter of Credit or a  Multicurrency
     Letter of Credit, as appropriate.

     "Letter of Credit  Application"  means an application and agreement for the
     issuance or  amendment  of a letter of credit in the form from time to time
     in use by the L/C Issuer.

     "Letter of Credit  Expiration  Date" means the day that is seven days prior
     to the Maturity Date then in effect (or, if such day is not a Business Day,
     the next preceding Business Day).

     "Lien"  means any  mortgage,  pledge,  hypothecation,  assignment,  deposit
     arrangement, encumbrance, lien (statutory or other), charge, or preference,
     priority or other security interest or preferential arrangement of any kind
     or  nature  whatsoever  (including  any  conditional  sale or  other  title
     retention agreement,  and any financing lease having substantially the same
     economic effect as any of the foregoing).

     "Loan"  means an  extension  of credit by a Lender  to the  Borrower  under
     Article II in the form of a Committed Loan or a Swing Line Loan.

     "Loan  Documents"  means this Agreement,  each Note, each Letter of Credit,
     each Letter of Credit Application, each Joinder Agreement, each Request for
     Credit  Extension,  each  Compliance  Certificate,  the Fee Letter and each
     other  document,  instrument or agreement from time to time executed by the
     Borrower or any of its Subsidiaries or any Responsible  Officer thereof and
     delivered in connection with this Agreement.

     "Loan   Obligations"   means  the  Domestic   Loan   Obligations   and  the
     Multicurrency Loan Obligations.

     "Loan Parties" means, collectively, the Borrower and each Guarantor.

     "Loan Party Tangible Domestic Assets" means, as of any date, the total book
     value of assets of the Loan  Parties that are  organized  under the laws of
     any political subdivision of the United States, which assets are located in
     the United States, minus (i) intercompany loans and advances from such Loan
     Parties to other members of the Consolidated  Group and (ii) the book value
     of intangible  assets of such Loan Parties,  including  goodwill,  patents,
     trade names,  trademarks,  copyrights,  franchises,  experimental  expense,
     organizational expense,  unamortized debt discount and expense and deferred
     assets  (other than prepaid  insurance  and prepaid  taxes),  determined in
     accordance  with GAAP.  "Mandatory  Cost Rate"  means,  with respect to any
     period, a rate per annum (rounded upward, if necessary, to the next 1/100th
     of 1%) determined in accordance with Schedule 1.01.

                                       17
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     "Mandatory Cost Reference Lender" means Bank of America.

     "Material  Adverse  Effect"  means (a) a material  adverse  change in, or a
     material  adverse  effect  upon,  the  operations,   business,  properties,
     liabilities (actual or contingent) or condition (financial or otherwise) of
     the  Borrower or the  Consolidated  Group taken as a whole;  (b) a material
     impairment  of the  ability of any Loan Party to  perform  its  obligations
     under any Loan Document to which it is a party;  or (c) a material  adverse
     effect  upon the  legality,  validity,  binding  effect  or  enforceability
     against any Loan Party of any Loan Document to which it is a party.

     "Material   Domestic   Subsidiary"  means  any  Domestic   Subsidiary  that
     constitutes more than 5% of consolidated  assets for the Consolidated Group
     as of the end of the immediately preceding fiscal quarter or generates more
     than 5% of consolidated  revenues for the Consolidated Group for the period
     of four consecutive fiscal quarters ending as of the end of the immediately
     preceding fiscal quarter.

     "Maturity Date" means September 10, 2005.

     "Moody's" means Moody's Investors Service, Inc. and any successor thereto.

     "Multicurrency  Commitment"  means, as to each  Multicurrency  Lender,  the
     commitment  of such  Lender to make  Multicurrency  Committed  Loans and to
     participate in  Multicurrency  L/C  Obligations  in an aggregate  principal
     amount at any one time  outstanding  not to exceed  the amount set forth as
     such Multicurrency Lender's "Multicurrency Commitment" on Schedule 2.01.

     "Multicurrency   Committed  Borrowing"  means  a  borrowing  consisting  of
     simultaneous  Multicurrency  Committed  Loans of the same Type, in the same
     currency  and,  in the case of  Eurocurrency  Rate  Loans,  having the same
     Interest  Period  made by each of the  Multicurrency  Lenders  as  provided
     herein.

     "Multicurrency  Committed  Loans"  has  the  meaning  provided  in  Section
     2.01(b).

     "Multicurrency  L/C  Advance"  means,  with  respect to each  Multicurrency
     Lender,  such Lender's funding of its  participation in a Multicurrency L/C
     Borrowing.

     "Multicurrency L/C Borrowing" means an extension of credit resulting from a
     drawing  under  any  Multicurrency  Letter  of  Credit  that  has not  been
     reimbursed on the date when made or refinanced as a Multicurrency Committed
     Borrowing.

     "Multicurrency  L/C Issuer" means Bank of America in its capacity as issuer
     of the  Multicurrency  Letters  of  Credit,  and  its  successors  in  such
     capacity.

                                       18
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     "Multicurrency L/C Obligations" means as of any date of determination,  the
     aggregate  undrawn  amount  of all  outstanding  Multicurrency  Letters  of
     Credit, plus the aggregate amount of all Unreimbursed Amounts in respect of
     Multicurrency Letters of Credit, including Multicurrency L/C Borrowings.

     "Multicurrency  Lenders"  means  each  of the  Lenders  with  Multicurrency
     Commitments hereunder.

     "Multicurrency Letter of Credit" means (i) those Existing Letters of Credit
     identified as  "Multicurrency  Letters of Credit" on Schedule 2.03 and (ii)
     any letter of credit issued under the  Multicurrency  Commitments under the
     provisions  of  Section  2.03(a).  Multicurrency  Letters  of Credit may be
     commercial letters of credit or standby letters of credit.

     "Multicurrency Letter of Credit Sublimit" shall have the meaning given such
     term in Section 2.03(a)(ii).

     "Multicurrency  Loan Obligations" means  Multicurrency  Committed Loans and
     Multicurrency L/C Obligations.

     "Multicurrency  Pro Rata Share" means,  with respect to each  Multicurrency
     Lender,  a fraction  (expressed  as  percentage,  carried  out to the ninth
     decimal place),  the numerator of which is the amount of the  Multicurrency
     Commitment of such Lender at such time and the  denominator of which is the
     amount of the Aggregate  Multicurrency  Commitments at such time;  provided
     that if the Multicurrency  Commitments shall have been terminated  pursuant
     to Section 9.02, then the Multicurrency Pro Rata Share of each Lender shall
     be  determined  based  on  the   Multicurrency   Pro  Rata  Share  of  such
     Multicurrency Lender immediately prior to such termination and after giving
     effect to any subsequent assignments made pursuant to the terms hereof. The
     initial  Multicurrency Pro Rata Share of each  Multicurrency  Lender is set
     forth as such  Multicurrency  Lender's  "Multicurrency  Pro Rata  Share" on
     Schedule 2.01.

     "Multiemployer  Plan" means any employee benefit plan of the type described
     in  Section  4001(a)(3)  of  ERISA,  to which  the  Borrower  or any  ERISA
     Affiliate  makes or is  obligated  to make  contributions,  or  during  the
     preceding   five  plan  years,   has  made  or  been   obligated   to  make
     contributions.

     "Note"  means a  promissory  note made by the Borrower in favor of a Lender
     evidencing Loans made by such Lender,  substantially in the form of Exhibit
     C.

     "Obligations"   means,   without   duplication,   (i)  the  Domestic   Loan
     Obligations,  (ii) the Multicurrency  Loan Obligations,  (iii) all advances
     to, and debts, liabilities,  obligations, covenants and duties of, any Loan
     Party arising under any Loan Document or otherwise with respect to any Loan
     or Letter of Credit,  whether direct or indirect  (including those acquired
     by assumption),  absolute or contingent, due or to become due, now existing
     or hereafter arising and including  interest and fees that accrue after the
     commencement

                                       19
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     by or against  any Loan Party or any  Affiliate  thereof of any  proceeding
     under any  Debtor  Relief  Laws  naming  such  Person as the debtor in such
     proceeding, regardless of whether such interest and fees are allowed claims
     in such proceeding, and (iv) any Swap Contract of any Loan Party to which a
     Lender or any Affiliate of such Lender is a party.

     "Organization  Documents"  means, (a) with respect to any corporation,  the
     certificate or articles of  incorporation  and the bylaws (or equivalent or
     comparable   constitutive   documents   with   respect   to  any   non-U.S.
     jurisdiction);  (b) with  respect to any  limited  liability  company,  the
     certificate  or  articles  of  formation  or  organization   and  operating
     agreement; and (c) with respect to any partnership, joint venture, trust or
     other form of business  entity,  the  partnership,  joint  venture or other
     applicable  agreement  of  formation  or  organization  and any  agreement,
     instrument,  filing or notice with respect thereto filed in connection with
     its formation or organization with the applicable Governmental Authority in
     the jurisdiction of its formation or organization  and, if applicable,  any
     certificate or articles of formation or organization of such entity.

     "Outstanding  Amount"  means (i) with respect to Committed  Loans and Swing
     Line  Loans  on  any  date,  the  aggregate  outstanding  principal  Dollar
     Equivalent thereof after giving effect to any borrowings and prepayments or
     repayments  of  Committed  Loans and Swing Line Loans,  as the case may be,
     occurring on such date; and (ii) with respect to any L/C Obligations on any
     date,  the Dollar  Equivalent  of such L/C  Obligations  on such date after
     giving  effect to any L/C Credit  Extension  occurring on such date and any
     other changes in the  aggregate  amount of the L/C  Obligations  as of such
     date,  including as a result of any  reimbursements  of outstanding  unpaid
     drawings  under any  Letters  of Credit or any  reductions  in the  maximum
     amount  available for drawing under Letters of Credit taking effect on such
     date.

     "Overnight  Rate"  means,  for any day,  (a)  with  respect  to any  amount
     denominated in Dollars,  the Federal Funds Rate and (b) with respect to any
     amount  denominated  in an Alternative  Currency,  the rate of interest per
     annum at which overnight deposits in the applicable  Alternative  Currency,
     in an amount  approximately  equal to the amount with respect to which such
     rate is being  determined,  would be  offered  for such day by a branch  or
     Affiliate of Bank of America located in the applicable interbank market for
     such currency to major banks in such interbank market.

     "Participant" has the meaning specified in Section 11.07(d).

     "Participating  Member  State"  means  each state so  described  in any EMU
     Legislation.

     "PBGC" means the Pension Benefit Guaranty Corporation.

     "Pension Plan" means any "employee  pension  benefit plan" (as such term is
     defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
     subject to Title IV of ERISA and is sponsored or maintained by the Borrower
     or any ERISA  Affiliate  or to which the  Borrower  or any ERISA  Affiliate
     contributes  or has an  obligation  to  contribute,

                                       20
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     or in the case of a multiple  employer or other plan  described  in Section
     4064(a) of ERISA, has made contributions at any time during the immediately
     preceding five plan years.

     "Person" means any natural person, corporation,  limited liability company,
     trust,  joint  venture,  association,  company,  partnership,  Governmental
     Authority or other entity.

     "Plan"  means any  "employee  benefit  plan" (as such  term is  defined  in
     Section 3(3) of ERISA)  established by the Borrower or, with respect to any
     such plan that is subject to Section 412 of the  Internal  Revenue  Code or
     Title IV of ERISA, any ERISA Affiliate.

     "Pro Forma Basis" means, for purposes of determining the applicable pricing
     level under the definition of "Applicable  Percentage"  (if the Borrower is
     unrated) and determining compliance with the financial covenants hereunder,
     that the  subject  transaction  shall be deemed to have  occurred as of the
     first day of the period of four  consecutive  fiscal  quarters ending as of
     the end of the most recent  fiscal  quarter for which  annual or  quarterly
     financial  statements  shall have been  delivered  in  accordance  with the
     provisions hereof.  Further,  for purposes of making calculations on a "Pro
     Forma  Basis"  hereunder,  (i) in the case of any  Disposition,  (A) income
     statement  items  (whether  positive  or  negative)   attributable  to  the
     property,   entities  or  business  units  that  are  the  subject  of  the
     disposition shall be excluded to the extent relating to any period prior to
     the date of subject  transaction,  and (B) Indebtedness  paid or retired in
     connection with the subject  transaction  shall be deemed to have been paid
     and retired as of the first day of the applicable  period;  and (ii) in the
     case of any acquisition,  (A) income  statement items (whether  positive or
     negative) attributable to the property, entities or business units that are
     the subject of the acquisition  shall be included to the extent relating to
     any period prior to the date of subject  transaction,  and (B) Indebtedness
     incurred in connection with the subject transaction shall be deemed to have
     been  incurred as of the first day of the  applicable  period (and interest
     expense  shall be imputed for the  applicable  period  assuming  prevailing
     interest rates hereunder).

     "Pro Rata Share" means (i) in respect of the Domestic  Commitments  and the
     Domestic Loan Obligations, the Domestic Pro Rata Share, and (ii) in respect
     of the Multicurrency  Commitments and the  Multicurrency  Loan Obligations,
     the Multicurrency Pro Rata Share.

     "Register" has the meaning set forth in Section 11.07(c).

     "Reportable  Event" means any of the events set forth in Section 4043(c) of
     ERISA,  other than events for which the  thirty-day  notice period has been
     waived.

     "Request  for Credit  Extension"  means (a) with  respect  to a  Borrowing,
     conversion or continuation of Committed Loans, a Committed Loan Notice, (b)
     with respect to an L/C Credit  Extension,  a Letter of Credit  Application,
     and (c) with respect to a Swing Line Loan, a Swing Line Loan Notice.

                                       21
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     "Required  Lenders" means, as of any date of determination,  Lenders having
     more than 50% of the Aggregate  Commitments  or, if the  commitment of each
     Lender  to make  Loans  and the  obligation  of the L/C  Issuer to make L/C
     Credit  Extensions have been terminated  pursuant to Section 9.02,  Lenders
     holding in the aggregate more than 50% of the Loan Obligations  (including,
     in each case, the aggregate amount of each Lender's risk  participation and
     funded  participation  in L/C Obligations  and Swing Line Loans);  provided
     that the  Commitment  of, and the portion of the Loan  Obligations  held or
     deemed held by, any  Defaulting  Lender  shall be excluded  for purposes of
     making a determination of Required Lenders.

     "Responsible Officer" means the chief executive officer,  president,  chief
     financial  officer,  treasurer or assistant  treasurer of a Loan Party. Any
     document delivered  hereunder that is signed by a Responsible  Officer of a
     Loan Party shall be  conclusively  presumed to have been  authorized by all
     necessary  corporate,  partnership  and/or other action on the part of such
     Loan Party and such Responsible  Officer shall be conclusively  presumed to
     have acted on behalf of such Loan Party.

     "Revaluation  Date"  means  each  of the  following:  (a)  each  date  of a
     Borrowing  of a  Eurocurrency  Rate  Loan  denominated  in  an  Alternative
     Currency,  (b) each  date of a  continuation  of a  Eurocurrency  Rate Loan
     denominated in an Alternative  Currency  pursuant to Section 2.02; (c) each
     date of  issuance  of a Letter  of  Credit  denominated  in an  Alternative
     Currency, (d) each date of an amendment of any such Letter of Credit having
     the effect of increasing the amount thereof,  and (e) such additional dates
     as the Administrative Agent or the Required Lenders shall specify.

     "Sale and Leaseback Transaction" means, with respect to the Borrower or any
     Subsidiary,  any  arrangement,  directly  or  indirectly,  with any  person
     whereby  the  Borrower  or  such  Subsidiary  shall  sell or  transfer  any
     property,  real or personal,  used or useful in its  business,  whether now
     owned or hereafter acquired,  and thereafter rent or lease such property or
     other property that it intends to use for substantially the same purpose or
     purposes as the property being sold or transferred.

     "Same Day Funds"  means (a) with respect to  disbursements  and payments in
     Dollars, immediately available funds, and (b) with respect to disbursements
     and payments in an Alternative Currency,  same day or other funds as may be
     determined  by the  Administrative  Agent to be  customary  in the place of
     disbursement  or  payment  for  the  settlement  of  international  banking
     transactions in the relevant Alternative Currency.

     "S&P"  means  Standard  &  Poor's  Ratings  Services,  a  division  of  The
     McGraw-Hill Companies, Inc. and any successor thereto.

     "SEC" means the Securities  and Exchange  Commission,  or any  Governmental
     Authority succeeding to any of its principal functions.

     "Securitization  Transaction"  means any  financing or factoring or similar
     transaction  (or  series  of such  transactions)  that  has  been or may be
     entered into by a member of the

                                       22
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     Consolidated  Group pursuant to which such member of the Consolidated Group
     may sell,  convey or otherwise  transfer,  or may grant a security interest
     in, any  accounts  receivable,  notes  receivable,  rights to future  lease
     payments  or   residuals   or  other   similar   rights  to  payment   (the
     "Securitization  Receivables") to a special purpose Subsidiary or Affiliate
     or any other Person.

     "Special Notice Currency" means at any time an Alternative Currency,  other
     than  the  currency  of  Japan  or of a  country  that is a  member  of the
     Organization for Economic  Cooperation and Development at such time located
     in North America or Europe.

     "Spot Rate"  means,  for a currency,  the rate quoted by Bank of America as
     the spot rate for the  purchase  by Bank of America of such  currency  with
     another currency  through its principal  foreign exchange trading office at
     approximately 11:00 a.m. on the date two Business Days prior to the date as
     of which the foreign exchange computation is made.

     "Subsidiary" of a Person means a corporation,  partnership,  joint venture,
     limited  liability  company or other business entity of which a majority of
     the shares of securities or other  interests  having  ordinary voting power
     for  the  election  of  directors  or  other  governing  body  (other  than
     securities  or interests  having such power only by reason of the happening
     of a contingency) are at the time beneficially  owned, or the management of
     which is otherwise controlled,  directly, or indirectly through one or more
     intermediaries,  or both, by such Person.  Unless otherwise specified,  all
     references herein to a "Subsidiary" or to  "Subsidiaries"  shall refer to a
     Subsidiary or Subsidiaries of the Borrower. Notwithstanding anything to the
     contrary  contained  herein,  Jordan  Bromine  Company  Ltd.  shall  not be
     considered a Subsidiary of the Borrower for purposes of this Agreement.

     "Swap Contract" means (a) any and all rate swap transactions,  basis swaps,
     credit derivative transactions, forward rate transactions, commodity swaps,
     commodity  options,  forward  commodity  contracts,  equity or equity index
     swaps or  options,  bond or bond  price or bond  index  swaps or options or
     forward  bond or forward  bond price or  forward  bond index  transactions,
     interest  rate  options,   forward  foreign  exchange   transactions,   cap
     transactions,  floor  transactions,  collar  transactions,   currency  swap
     transactions, cross-currency rate swap transactions, currency options, spot
     contracts,  or any other similar  transactions or any combination of any of
     the foregoing  (including any options to enter into any of the  foregoing),
     whether or not any such transaction is governed by or subject to any master
     agreement,  and (b) any and all  transactions  of any kind, and the related
     confirmations, that are subject to the terms and conditions of, or governed
     by, any form of master agreement  published by the International  Swaps and
     Derivatives  Association,  Inc., any International  Foreign Exchange Master
     Agreement,  or any  other  master  agreement  (any such  master  agreement,
     together with any related schedules,  a "Master Agreement"),  including any
     such obligations or liabilities under any Master Agreement.

     "Swap  Termination  Value"  means,  in  respect  of any  one or  more  Swap
     Contracts,  after taking into account the effect of any legally enforceable
     netting agreement  relating to

                                       23
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     such  Swap  Contracts,  (a) for any date on or after  the  date  such  Swap
     Contracts  have been  closed out and  termination  value(s)  determined  in
     accordance therewith, such termination value(s), and (b) for any date prior
     to the date  referenced  in clause (a),  the  amount(s)  determined  as the
     mark-to-market  value(s) for such Swap Contracts,  as determined based upon
     one or more mid-market or other readily  available  quotations  provided by
     any recognized dealer in such Swap Contracts (which may include a Lender or
     any Affiliate of a Lender).

     "Swing Line" means the  revolving  credit  facility  made  available by the
     Swing Line Lender pursuant to Section 2.04.

     "Swing Line  Borrowing"  means a borrowing of a Swing Line Loan pursuant to
     Section 2.04.

     "Swing Line  Lender"  means Bank of America in its  capacity as provider of
     Swing Line Loans, or any successor swing line lender hereunder.

     "Swing Line Loan" has the meaning specified in Section 2.04(a).

     "Swing Line Loan Notice" means a notice of a Swing Line Borrowing  pursuant
     to Section  2.04(b),  which, if in writing,  shall be  substantially in the
     form of Exhibit B.

     "Swing Line Sublimit" has the meaning specified in Section 2.04(a).

     "Synthetic  Lease" means any  synthetic,  tax  retention  operating  lease,
     off-balance sheet loan or similar off-balance sheet financing product where
     such transaction is considered borrowed money indebtedness for tax purposes
     but is classified as an operating lease under GAAP.

     "TARGET Day" means any day on which the Trans-European  Automated Real-time
     Gross  Settlement  Express  Transfer  (TARGET) System (or, if such clearing
     system  ceases  to be  operative,  such  other  clearing  system  (if  any)
     determined by the  Administrative  Agent to be a suitable  replacement)  is
     operating.

     "Threshold Amount" means THIRTY-FIVE MILLION DOLLARS ($35,000,000).

     "Type"  means,  with respect to a Committed  Loan,  its character as a Base
     Rate Loan or a Eurocurrency Rate Loan.

     "Unfunded Pension  Liability" means, the excess of a Pension Plan's benefit
     liabilities  under Section  4001(a)(16) of ERISA, over the current value of
     that Pension Plan's  assets,  determined as of the end of the most recently
     completed plan year in accordance with the assumptions used for funding the
     Pension Plan  pursuant to Section 412 of the Internal  Revenue Code for the
     applicable plan year.

     "United States" and "U.S." mean the United States of America.

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     "Unreimbursed Amount" has the meaning set forth in Section 2.03(c)(i).

     1.02 Other Interpretive Provisions.

     With  reference  to this  Agreement  and each other Loan  Document,  unless
     otherwise specified herein or in such other Loan Document:

     (a) The meanings of defined  terms are equally  applicable  to the singular
     and plural forms of the defined terms.

     (b) (i) The words "herein," "hereto," "hereof" and "hereunder" and words of
     similar  import  when used in any Loan  Document  shall  refer to such Loan
     Document as a whole and not to any particular provision thereof.

     (ii)  Article,  Section,  Exhibit and Schedule  references  are to the Loan
     Document  in  which  such  reference  appears  unless  otherwise  expressly
     referenced.

     (iii) The term "including" is by way of example and not limitation.

     (iv) The term  "documents"  includes  any and all  instruments,  documents,
     agreements,  certificates, notices, reports, financial statements and other
     writings, however evidenced, whether in physical or electronic form.

     (c) In the  computation of periods of time from a specified date to a later
     specified date, the word "from" means "from and including";  the words "to"
     and "until" each mean "to but excluding";  and the word "through" means "to
     and including."

     (d) Section  headings  herein and in the other Loan  Documents are included
     for  convenience of reference only and shall not affect the  interpretation
     of this Agreement or any other Loan Document.

     1.03 Accounting Terms.

     (a) All  accounting  terms not  specifically  or completely  defined herein
     shall be construed in conformity  with, and all financial  data  (including
     financial ratios and other financial calculations) required to be submitted
     pursuant  to this  Agreement  shall be prepared in  conformity  with,  GAAP
     applied on a consistent basis, as in effect from time to time, applied in a
     manner  consistent  with  that  used in  preparing  the  audited  financial
     statements for the fiscal year ended December 31, 2001, except as otherwise
     specifically prescribed herein.

     (b) Notwithstanding anything herein to the contrary,  determinations of (i)
     the   applicable   pricing  level  under  the   definition  of  "Applicable
     Percentage"  (if the  Borrower

                                       25
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     is unrated) and (ii)  compliance  with the  financial  covenants  hereunder
     shall be made on a Pro Forma Basis.

     (c) The Borrower will provide a written summary of material changes in GAAP
     or in the  consistent  application  thereof with each annual and  quarterly
     Compliance  Certificate delivered in accordance with Section 7.02(b). If at
     any time any change in GAAP would affect the  computation  of any financial
     ratio or  requirement  set  forth  in any Loan  Document,  and  either  the
     Borrower  or the  Required  Lenders  shall so request,  the  Administrative
     Agent,  the Lenders and the Borrower shall negotiate in good faith to amend
     such ratio or requirement to preserve the original  intent thereof in light
     of such change in GAAP  (subject to the approval of the Required  Lenders);
     provided  that,  until so  amended,  (i) such  ratio or  requirement  shall
     continue  to be  computed  in  accordance  with GAAP  prior to such  change
     therein and (ii) the Borrower shall provide to the Administrative Agent and
     the Lenders  financial  statements and other documents  required under this
     Agreement  or  as   reasonably   requested   hereunder   setting   forth  a
     reconciliation  between  calculations  of such  ratio or  requirement  made
     before and after giving effect to such change in GAAP.

     1.04 Rounding.

     Any financial ratios required to be maintained by the Borrower  pursuant to
     this Agreement shall be calculated by dividing the appropriate component by
     the other component,  carrying the result to one place more than the number
     of places by which such ratio is  expressed  herein and rounding the result
     up or down to the nearest number (with a rounding-up if there is no nearest
     number).

     1.05 References to Agreements and Laws.

     Unless otherwise  expressly provided herein, (a) references to Organization
     Documents,  agreements (including the Loan Documents) and other contractual
     instruments   shall  be  deemed  to  include  all  subsequent   amendments,
     restatements,  extensions, supplements and other modifications thereto, but
     only  to  the  extent  that  such  amendments,  restatements,   extensions,
     supplements  and  other  modifications  are  not  prohibited  by  any  Loan
     Document;  and (b)  references  to any Law shall  include all statutory and
     regulatory provisions consolidating,  amending, replacing, supplementing or
     interpreting such Law.

     1.06 Times of Day.

     Unless otherwise specified,  all references herein to times of day shall be
     references to New York time (Eastern daylight or standard, as applicable).

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     1.07 Letter of Credit Amounts.

     Unless otherwise specified, all references herein to the amount of a Letter
     of Credit at any time shall be deemed to mean the  maximum  face  amount of
     such  Letter  of  Credit  after  giving  effect  to all  increases  thereof
     contemplated  by such Letter of Credit or the Letter of Credit  Application
     therefor,  whether  or not such  maximum  face  amount is in effect at such
     time.

     1.08 Exchange Rates; Currency Equivalents.

     (a) The  Administrative  Agent  shall  determine  the Spot Rates as of each
     Revaluation Date to be used for calculating  Dollar  Equivalent  amounts of
     Credit  Extensions  and  Outstanding  Amounts  denominated  in  Alternative
     Currencies.  Such Spot Rates shall become  effective as of such Revaluation
     Date and shall be the Spot Rates employed in converting any amounts between
     the applicable  currencies until the next Revaluation Date to occur. Except
     for purposes of financial statements delivered by Loan Parties hereunder or
     calculating  financial  covenants hereunder or except as otherwise provided
     herein,  the  applicable  amount of any  currency  for purposes of the Loan
     Documents  shall be such Dollar  Equivalent  amount as so determined by the
     Administrative Agent.

     (b) Wherever in this Agreement in connection with a Borrowing,  conversion,
     continuation or prepayment of a Loan or the issuance of a Letter of Credit,
     an amount,  such as a required minimum or multiple amount,  is expressed in
     Dollars, but such Borrowing,  Loan or Letter of Credit is denominated in an
     Alternative  Currency,  such  amount  shall  be  the  relevant  Alternative
     Currency  Equivalent  of such Dollar  amount  (rounded to the nearest 1,000
     units of such Alternative  Currency),  as determined by the  Administrative
     Agent.

     1.09 Additional Alternative Currencies.

     The Borrower may from time to time request that Committed  Loans be made in
     a currency  other  than  those  specifically  listed in the  definition  of
     "Alternative  Currency";  provided that such requested  currency  otherwise
     meets the requirements set forth in such definition. Any such request shall
     be made to the  Administrative  Agent  (which  shall  promptly  notify each
     Multicurrency  Lender  thereof)  not later than 12:00 noon twelve  Business
     Days prior to the date of the desired Credit Extension.  Each Multicurrency
     Lender shall notify the Administrative Agent, not later than 12:00 noon ten
     Business  Days after  receipt of such request  whether it consents,  in its
     sole discretion,  to making Committed Loans in such requested currency. Any
     failure by a  Multicurrency  Lender to respond to such  request  within the
     time period  specified in the  preceding  sentence  shall be deemed to be a
     refusal by such Lender to make Committed Loans in such requested  currency.
     If all the Multicurrency  Lenders consent to making Committed Loans in such
     requested currency,  the Administrative  Agent shall so notify the Borrower
     and such  currency  shall  thereupon  be deemed for all  purposes  to be an
     Alternative Currency hereunder.  Upon any Multicurrency Lender's refusal to
     make

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     Committed  Loans in the  additional  requested  currency,  the Borrower may
     replace such Lender in accordance with Section 11.16.

     1.10 Redenomination of Certain Alternative Currencies.

     (a) Each  obligation of the Borrower to make a payment  denominated  in the
     national  currency  unit of any  member  state of the  European  Union that
     adopts  the Euro as its  lawful  currency  after the date  hereof  shall be
     redenominated  into Euro at the time of such adoption (in  accordance  with
     the EMU  Legislation).  If, in relation to the  currency of any such member
     state,  the basis of accrual of interest  expressed  in this  Agreement  in
     respect of that  currency  shall be  inconsistent  with any  convention  or
     practice  in the  London  interbank  market  for the  basis of  accrual  of
     interest in respect of the Euro,  such expressed basis shall be replaced by
     such  convention or practice with effect from the date on which such member
     state  adopts  the  Euro  as its  lawful  currency;  provided  that  if any
     Borrowing in the currency of such member state is  outstanding  immediately
     prior to such date,  such  replacement  shall take effect,  with respect to
     such Borrowing, at the end of the then current Interest Period.

     (b) Each  provision of this Agreement  shall be subject to such  reasonable
     changes of construction as the  Administrative  Agent may from time to time
     specify to be appropriate to reflect the adoption of the Euro by any member
     state  of the  European  Union  and  any  relevant  market  conventions  or
     practices relating to the Euro.


                                   Article II.

                      THE COMMITMENTS AND CREDIT EXTENSIONS

     2.01 Committed Loans; Increase in Commitments.

     (a) Domestic Committed Loans. Subject to the terms and conditions set forth
     herein, each Domestic Lender severally agrees to make loans (each such loan
     a "Domestic  Committed  Loan") to the Borrower in Dollars from time to time
     on any Business Day; provided that after giving effect to any such Domestic
     Committed Loan, (i) with regard to the Domestic Lenders  collectively,  the
     aggregate  principal amount of Domestic Loan  Obligations  shall not exceed
     TWO HUNDRED SEVENTY-FIVE MILLION DOLLARS ($275,000,000) (as such amount may
     be increased or decreased in accordance  with the  provisions  hereof,  the
     "Aggregate  Domestic  Commitments"),  and (ii) with regard to each Domestic
     Lender individually,  such Lender's Domestic Pro Rata Share of the Domestic
     Loan  Obligations  shall not exceed  its  respective  Domestic  Commitment.
     Domestic Committed Loans may consist of Base Rate Loans,  Eurocurrency Rate
     Loans, or a combination  thereof,  as the Borrower may request,  and may be
     repaid and reborrowed in accordance with the provisions hereof.

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     (b) Multicurrency  Committed Loans. Subject to the terms and conditions set
     forth herein,  each  Multicurrency  Lender  severally  agrees to make loans
     (each  such  loan a  "Multicurrency  Committed  Loan") to the  Borrower  in
     Dollars or  Alternative  Currencies  from time to time on any Business Day;
     provided that after giving effect to any such Multicurrency Committed Loan,
     (i) with regard to the Multicurrency  Lenders  collectively,  the aggregate
     principal  amount of Multicurrency  Loan  Obligations  shall not exceed ONE
     HUNDRED MILLION DOLLARS  ($100,000,000) (as such amount may be increased or
     decreased  in  accordance  with  the  provisions   hereof,  the  "Aggregate
     Multicurrency  Commitments"),  and (ii) with  regard to each  Multicurrency
     Lender  individually,  such  Lender's  Multicurrency  Pro Rata Share of the
     Multicurrency   Loan   Obligations   shall  not   exceed   its   respective
     Multicurrency Commitment. Multicurrency Committed Loans may consist of Base
     Rate Loans,  Eurocurrency  Rate Loans,  or a  combination  thereof,  as the
     Borrower may request,  and may be repaid and reborrowed in accordance  with
     the provisions hereof.

     (c) Increase in Aggregate Commitments.  Subject to the terms and conditions
     set  forth  herein,   the  Borrower   may,  upon  written   notice  to  the
     Administrative  Agent,  increase the Aggregate Commitments to an amount not
     to exceed FOUR HUNDRED MILLION DOLLARS ($400,000,000); provided that:

     (i) the Borrower  shall obtain  commitments  for the amount of the increase
     from existing Lenders or other financial institutions reasonably acceptable
     to the  Administrative  Agent,  which financial  institutions shall join in
     this Agreement as Lenders by joinder agreement substantially in the form of
     Exhibit H attached hereto or other arrangement reasonably acceptable to the
     Administrative  Agent,  (ii) any such  increase to the  Aggregate  Domestic
     Commitments  or to the Aggregate  Multicurrency  Commitments  shall be in a
     minimum aggregate  principal amount of $5,000,000 and integral multiples of
     $1,000,000 in excess thereof (or the remaining amount,  if less),  (iii) if
     any Committed Loans are  outstanding at the time of any such increase,  the
     Borrower shall make such payments and  adjustments  on the Committed  Loans
     (including  payment of any  amounts  owing  under  Section  3.05) as may be
     necessary  to give effect to the  revised  Pro Rata  Shares and  Commitment
     amounts,  and (iv) the  conditions  to the making of a  Committed  Loan set
     forth in Section 5.02 shall be satisfied.

     In connection with any such increase in the Aggregate Commitments, Schedule
     2.01 shall be revised to reflect the modified  commitments  and  commitment
     percentages  of the Lenders,  and the  Borrower  shall  provide  supporting
     corporate resolutions,  legal opinions, promissory notes and other items as
     may be reasonably  requested by the  Administrative  Agent on behalf of any
     Lender in connection therewith.

     2.02 Borrowings, Conversions and Continuations of Committed Loans.

     (a) Each Committed  Borrowing,  each conversion of Committed Loans from one
     Type to the other,  and each  continuation  of Committed  Loans as the same
     Type  shall  be  made  upon  the  Borrower's   irrevocable  notice  to  the
     Administrative Agent, which may

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     be  given  by  telephone.   Each  such  notice  must  be  received  by  the
     Administrative  Agent not later  than 12:00  noon (i) three  Business  Days
     prior  to  the  requested  date  of  any  Borrowing  of,  conversion  to or
     continuation  of Eurocurrency  Rate Loans  denominated in Dollars or of any
     conversion of Eurocurrency  Rate Loans  denominated in Dollars to Base Rate
     Loans,  (ii)  four  Business  Days  (or five  Business  Days in the case of
     Special Notice  Currency)  prior to the requested date of any Borrowing of,
     conversion to or  continuation of  Eurocurrency  Rate Loans  denominated in
     Alternative  Currencies  and (ii) one Business  Day prior to the  requested
     date of any  Borrowing of Base Rate Loans.  Each  telephonic  notice by the
     Borrower  pursuant to this Section  2.02(b)  must be confirmed  promptly by
     delivery to the  Administrative  Agent of a written  Committed Loan Notice,
     appropriately  completed  and  signed  by  a  Responsible  Officer  of  the
     Borrower.  Each Borrowing of, conversion to or continuation of Eurocurrency
     Rate Loans shall be in a principal amount of $5,000,000 or a whole multiple
     of $1,000,000 in excess thereof. Except as provided in Sections 2.03(c) and
     2.04(c),  each  Borrowing of or conversion to Base Rate Loans shall be in a
     principal  amount of $1,000,000  or a whole  multiple of $500,000 in excess
     thereof.  Each Committed Loan Notice (whether  telephonic or written) shall
     specify (i) whether the  Borrower is  requesting a Committed  Borrowing,  a
     conversion of Committed Loans from one Type to the other, or a continuation
     of  Eurocurrency  Rate Loans,  (ii) the  requested  date of the  Borrowing,
     conversion or  continuation,  as the case may be (which shall be a Business
     Day),  (iii)  the  principal  amount  of  Committed  Loans to be  borrowed,
     converted or continued,  (iv) the Type of Committed Loans to be borrowed or
     to which existing  Committed Loans are to be converted,  (v) if applicable,
     the  duration  of the  Interest  Period  with  respect  thereto and (vi) if
     applicable, the Alternative Currency requested with respect thereto. If the
     Borrower  fails to specify a Type of  Committed  Loan in a  Committed  Loan
     Notice  or if the  Borrower  fails to give a  timely  notice  requesting  a
     conversion or  continuation,  then the applicable  Committed Loans shall be
     made as, or  converted  to, Base Rate Loans on the last day of the Interest
     Period applicable thereto; provided, however, that in the case of a failure
     to timely  request a  continuation  of Committed  Loans  denominated  in an
     Alternative  Currency,  such Loans shall be continued as Eurocurrency  Rate
     Loans in their original  currency with an Interest  Period of one month. No
     Committed  Loan may be  converted  into or  continued  as a Committed  Loan
     denominated  in a different  currency,  but instead  must be prepaid in the
     original currency of such Loan and reborrowed in the other currency.

     (b) Following receipt of a Committed Loan Notice, the Administrative  Agent
     shall  promptly  notify  each Lender of the amount of its Pro Rata Share of
     the applicable  Committed Loans, and if no timely notice of a conversion or
     continuation is provided by the Borrower,  the  Administrative  Agent shall
     notify each Lender of the details of any automatic  conversion to Base Rate
     Loans or  continuation  of Committed  Loans  denominated  in an Alternative
     Currency,  in each case as described in the  preceding  subsection.  In the
     case of a Committed  Borrowing,  each  Lender  shall make the amount of its
     Committed Loan available to the  Administrative  Agent in Same Day Funds at
     the  Administrative  Agent's Office for the  Applicable  Currency not later
     than 1:00 p.m., in the case of any Committed  Loan  denominated in Dollars,
     and not later than the  Applicable  Time  specified  by the  Administrative
     Agent  in the  case  of  any  Committed  Loan

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     denominated  in  Alternative  Currency,  in each case on the  Business  Day
     specified in the applicable Committed Loan Notice. Upon satisfaction of the
     applicable  conditions set forth in Section 5.02 (and, if such Borrowing is
     the initial Credit Extension, Section 5.01), the Administrative Agent shall
     make all funds so  received  available  to the  Borrower  in like  funds as
     received by the Administrative Agent either by (i) crediting the account of
     the  Borrower on the books of Bank of America with the amount of such funds
     or (ii)  wire  transfer  of such  funds,  in each case in  accordance  with
     instructions  provided to (and reasonably acceptable to) the Administrative
     Agent  by the  Borrower;  provided,  however,  that  if,  on the  date of a
     Committed  Borrowing  in  Dollars,  there  are  Swing  Line  Loans  or  L/C
     Borrowings  outstanding,  then  the  proceeds  of such  Borrowing  shall be
     applied, first, to the payment in full of any such L/C Borrowings,  second,
     to the  payment  in full of any such Swing Line  Loans,  and third,  to the
     Borrower as provided above.

     (c) Except as otherwise  provided herein,  a Eurocurrency  Rate Loan may be
     continued or converted only on the last day of the Interest Period for such
     Eurocurrency  Rate  Loan.  During  the  existence  of a Default or Event of
     Default,  no Loans  may be  requested  as,  converted  to or  continued  as
     Eurocurrency  Rate Loans without the consent of the Required  Lenders,  and
     the Required Lenders may demand that (i) any or all of the then outstanding
     Eurocurrency Rate Loans denominated in Dollars be converted  immediately to
     Base Rate  Loans and (ii) any or all of the then  outstanding  Eurocurrency
     Rate Loans  denominated in an  Alternative  Currency be prepaid on the last
     day of the then current Interest Period with respect thereto.

     (d) The  Administrative  Agent shall  promptly  notify the Borrower and the
     Lenders  of the  interest  rate  applicable  to  any  Interest  Period  for
     Eurocurrency  Rate Loans upon  determination  of such  interest  rate.  The
     determination of the Adjusted Eurocurrency Rate by the Administrative Agent
     shall be conclusive in the absence of manifest error. At any time that Base
     Rate Loans are  outstanding,  the  Administrative  Agent  shall  notify the
     Borrower and the Lenders of any change in Bank of America's prime rate used
     in determining the Base Rate promptly following the public  announcement of
     such change.

     (e) After giving effect to all Committed  Borrowings,  all  conversions  of
     Committed  Loans  from  one Type to the  other,  and all  continuations  of
     Committed Loans as the same Type, there shall not be more than ten Interest
     Periods in effect with respect to Committed Loans.

     2.03 Letters of Credit.

     (a) The Letter of Credit Commitment.

     (i)  Domestic  Letter  of  Credit  Commitment.  Subject  to the  terms  and
     conditions  set forth  herein,

     (A) the Domestic L/C Issuer agrees,  in reliance upon the agreements of the
     other Domestic Lenders set forth herein, (1) on any Business Day

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     during  the  period  from the  Closing  Date  until  the  Letter  of Credit
     Expiration  Date,  to issue  Domestic  Letters of Credit in Dollars for the
     account of the Borrower or any of its  Subsidiaries,  and to amend or renew
     Domestic Letters of Credit  previously issued by it, in accordance with the
     provisions  hereof,  and (2) to honor  drafts  under  Domestic  Letters  of
     Credit, and

     (B) the Domestic  Lenders  severally  agree to  participate in the Domestic
     Letters  of Credit as  provided  herein;  provided  that (x) the  aggregate
     principal  amount of Domestic L/C  Obligations  shall not exceed the sum of
     THIRTY-FIVE  MILLION DOLLARS  ($35,000,000)  minus the aggregate  principal
     amount of Multicurrency L/C Obligations (as such amount may be increased or
     decreased in accordance with the provisions hereof, the "Domestic Letter of
     Credit  Sublimit"),  (y) with regard to the Domestic Lenders  collectively,
     the  aggregate  principal  amount of Domestic  Loan  Obligations  shall not
     exceed the  Aggregate  Domestic  Commitments,  and (z) with  regard to each
     Domestic Lender individually,  such Lender's Domestic Pro Rata Share of the
     Domestic  Loan  Obligations  shall  not  exceed  its  respective   Domestic
     Commitment.  Subject to the terms and  conditions  hereof,  the  Borrower's
     ability to obtain  Domestic  Letters of Credit shall be fully revolving and
     accordingly the Borrower may obtain  Domestic  Letters of Credit to replace
     Domestic  Letters of Credit that have  expired or that have been drawn upon
     and  reimbursed.  Existing  Letters of Credit that are Domestic  Letters of
     Credit shall be deemed to have been issued  hereunder  and shall be subject
     to and governed by the terms and conditions hereof.

     (ii) Multicurrency  Letter of Credit  Commitment.  Subject to the terms and
     conditions set forth herein,  (A) the  Multicurrency  L/C Issuer agrees, in
     reliance upon the agreements of the other  Multicurrency  Lenders set forth
     herein,  (1) on any  Business  Day during the period from the Closing  Date
     until the Letter of Credit Expiration Date, to issue Multicurrency  Letters
     of Credit in  Dollars  or  Alternative  Currencies  for the  account of the
     Borrower or any of its  Subsidiaries,  and to amend or renew  Multicurrency
     Letters  of  Credit  previously  issued  by  it,  in  accordance  with  the
     provisions hereof, and (2) to honor drafts under  Multicurrency  Letters of
     Credit, and

     (B)  the  Multicurrency  Lenders  severally  agree  to  participate  in the
     Multicurrency  Letters of Credit as provided herein;  provided that (x) the
     aggregate  principal  amount of  Multicurrency  L/C  Obligations  shall not
     exceed  the sum of  THIRTY-FIVE  MILLION  DOLLARS  ($35,000,000)  minus the
     aggregate  principal amount of Domestic L/C Obligations (as such amount may
     be increased or decreased in accordance  with the  provisions  hereof,  the
     "Multicurrency  Letter  of  Credit  Sublimit"),  (y)  with  regard  to  the
     Multicurrency  Lenders  collectively,  the  aggregate  principal  amount of
     Multicurrency Loan Obligations shall not exceed the Aggregate

                                       32
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     Multicurrency Commitments, and (z) with regard to each Multicurrency Lender
     individually,   such   Lender's   Multicurrency   Pro  Rata  Share  of  the
     Multicurrency   Loan   Obligations   shall  not   exceed   its   respective
     Multicurrency  Commitment.  Subject to the terms and conditions hereof, the
     Borrower's ability to obtain Multicurrency Letters of Credit shall be fully
     revolving and accordingly the Borrower may obtain Multicurrency  Letters of
     Credit to replace Multicurrency Letters of Credit that have expired or that
     have been drawn upon and  reimbursed.  Existing  Letters of Credit that are
     Multicurrency  Letters  of  Credit  shall be  deemed  to have  been  issued
     hereunder and shall be subject to and governed by the terms and  conditions
     hereof.

     (iii) The  applicable  L/C Issuer shall be under no obligation to issue any
     Letter of Credit if:

     (A) the  issuance  of such  Letter  of  Credit  would  violate  one or more
     policies of such L/C Issuer; or

     (B) such Letter of Credit is in an initial amount less than $25,000, in the
     case of a  commercial  Letter  of  Credit,  or  $100,000,  in the case of a
     standby  Letter of  Credit,  or (i) with  respect  to  Domestic  Letters of
     Credit,  is to be denominated  in a currency  other than Dollars,  and (ii)
     with respect to Multicurrency  Letters of Credit, is to be denominated in a
     currency other than Dollars or Alternative Currencies.

     (iv) The applicable L/C Issuer shall not issue any Letter of Credit if:

     (A)  any  order,  judgment  or  decree  of any  Governmental  Authority  or
     arbitrator shall by its terms purport to enjoin or restrain such L/C Issuer
     from  issuing  such  Letter of Credit,  or any Law  applicable  to such L/C
     Issuer or any request or directive (whether or not having the force of law)
     from any  Governmental  Authority  with  jurisdiction  over such L/C Issuer
     shall prohibit,  or request that such L/C Issuer refrain from, the issuance
     of letters of credit  generally or such Letter of Credit in  particular  or
     shall impose upon such L/C Issuer with respect to such Letter of Credit any
     restriction,  reserve or capital  requirement (for which such L/C Issuer is
     not otherwise compensated  hereunder) not in effect on the Closing Date, or
     shall impose upon such L/C Issuer any  unreimbursed  loss,  cost or expense
     that was not  applicable  on the  Closing  Date and that such L/C Issuer in
     good faith deems material to it;

     (B)  subject to Section  2.03(b)(iii),  the expiry  date of such  requested
     Letter of Credit  would  occur more than  twelve  months  after the date of
     issuance or last  renewal,  unless (1) with respect to Domestic  Letters of
     Credit,  Domestic Lenders having more than 50% of the Domestic  Commitments
     (or, if the  commitment  to make Loans and L/C Credit

                                       33
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     Extensions has been  terminated,  Domestic Lenders holding more than 50% of
     the Domestic  Loan  Obligations  (including,  in each case,  the  aggregate
     amount of such  Lender's risk  participation  and funded  participation  in
     Domestic L/C  Obligations  and Swing Line Loans) have  approved such expiry
     date,   and  (2)  with   respect  to   Multicurrency   Letters  of  Credit,
     Multicurrency Lenders having more than 50% of the Multicurrency Commitments
     (or, if the  commitment  to make Loans and L/C Credit  Extensions  has been
     terminated,   Multicurrency   Lenders   holding   more   than  50%  of  the
     Multicurrency  Loan  Obligations  (including,  in each case,  the aggregate
     amount of such  Lender's risk  participation  and funded  participation  in
     Multicurrency L/C Obligations) have approved such expiry date; or

     (C) the expiry date of such  requested  Letter of Credit  would occur after
     the Letter of Credit  Expiration Date,  unless (i) with respect to Domestic
     Letters of Credit,  all of the Domestic  Lenders have  approved such expiry
     date, and (ii) with respect to Multicurrency  Letters of Credit, all of the
     Multicurrency Lenders have approved such expiry date.

     (v) The  applicable  L/C Issuer shall be under no  obligation  to amend any
     Letter of Credit if (A) such L/C Issuer  would have no  obligation  at such
     time to issue  such  Letter of Credit in its  amended  form under the terms
     hereof, or (B) the beneficiary of such Letter of Credit does not accept the
     proposed amendment to such Letter of Credit.

     (vi) The  applicable  L/C  Issuer  shall not  issue or amend any  Letter of
     Credit if (A) one or more  applicable  conditions  contained  in  Article V
     shall not then be satisfied and such L/C Issuer shall have received written
     notice thereof from any Lender, the Administrative  Agent or any Loan Party
     on or prior to the Business Day prior to the requested  date of issuance or
     amendment  of such  Letter  of  Credit,  or (B) the  Commitments  have been
     terminated pursuant to Section 9.02.

     (b)   Procedures   for  Issuance  and   Amendment  of  Letters  of  Credit;
     Auto-Renewal Letters of Credit.

     (i) Each Letter of Credit  shall be issued or amended,  as the case may be,
     upon the request of the  Borrower  delivered to the  applicable  L/C Issuer
     (with a copy to the Administrative Agent) in the form of a Letter of Credit
     Application, appropriately completed and signed by a Responsible Officer of
     the Borrower.  Such Letter of Credit  Application  must be received by such
     L/C Issuer and the Administrative  Agent not later than 12:00 noon at least
     three  Business  Days (or such  later  date and time as such L/C Issuer may
     agree  in a  particular  instance  in its  sole  discretion)  prior  to the
     proposed  issuance  date or date of  amendment,  as the case may be. In the
     case of a request  for an  initial  issuance  of a Letter of  Credit,  such
     Letter of Credit Application shall specify in form and detail

                                       34
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     satisfactory  to such L/C Issuer:  (A) the  proposed  issuance  date of the
     requested  Letter of Credit (which shall be a Business Day); (B) the amount
     and Applicable Currency thereof;  (C) the expiry date thereof; (D) the name
     and address of the beneficiary  thereof;  (E) the documents to be presented
     by such beneficiary in case of any drawing thereunder; (F) the full text of
     any certificate to be presented by such  beneficiary in case of any drawing
     thereunder;  and (G) such other matters as such L/C Issuer may require.  In
     the case of a request for an amendment of any outstanding Letter of Credit,
     such  Letter  of  Credit  Application  shall  specify  in form  and  detail
     satisfactory to such L/C Issuer (A) the Letter of Credit to be amended; (B)
     the proposed date of amendment thereof (which shall be a Business Day); (C)
     the nature of the proposed  amendment;  and (D) such other  matters as such
     L/C Issuer may require.

     (ii)  Promptly  after  receipt  of any  Letter of Credit  Application,  the
     applicable  L/C  Issuer  will  confirm  with the  Administrative  Agent (by
     telephone or in writing) that the Administrative  Agent has received a copy
     of such Letter of Credit  Application  from the Borrower  and, if not, such
     L/C Issuer will provide the Administrative Agent with a copy thereof.  Upon
     receipt by such L/C Issuer of confirmation  from the  Administrative  Agent
     that the requested  issuance or amendment is permitted in  accordance  with
     the terms hereof,  then, subject to the terms and conditions  hereof,  such
     L/C Issuer shall, on the requested  date,  issue a Letter of Credit for the
     account of the Borrower or enter into the applicable amendment, as the case
     may be,  in each  case in  accordance  with  such L/C  Issuer's  usual  and
     customary  business  practices.  Immediately  upon the issuance of (A) each
     Domestic  Letter of Credit,  each  Domestic  Lender shall be deemed to, and
     hereby  irrevocably  and  unconditionally  agrees  to,  purchase  from  the
     Domestic  L/C Issuer a risk  participation  in such  Letter of Credit in an
     amount equal to the product of such Lender's  Domestic Pro Rata Share times
     the amount of such  Letter of Credit and (B) each  Multicurrency  Letter of
     Credit,   each  Multicurrency   Lender  shall  be  deemed  to,  and  hereby
     irrevocably and unconditionally  agrees to, purchase from the Multicurrency
     L/C Issuer a risk participation in such Letter of Credit in an amount equal
     to the  product of such  Lender's  Multicurrency  Pro Rata Share  times the
     amount of such Letter of Credit.

     (iii) If the  Borrower  so  requests  in any  applicable  Letter  of Credit
     Application,  the  applicable  L/C  Issuer  may,  in its sole and  absolute
     discretion,  agree to issue a Letter of Credit that has  automatic  renewal
     provisions  (each, an "Auto-Renewal  Letter of Credit");  provided that any
     such  Auto-Renewal  Letter of Credit must permit such L/C Issuer to prevent
     any such renewal at least once in each twelve-month period (commencing with
     the date of issuance of such  Letter of Credit) by giving  prior  notice to
     the beneficiary thereof not later than a day (the "Nonrenewal Notice Date")
     in each such twelve-month  period to be agreed upon at the time such Letter
     of Credit is issued.  Unless  otherwise  directed by such L/C  Issuer,  the
     Borrower  shall not be  required  to make a  specific  request  to such L/C
     Issuer for any such renewal. Once an Auto-Renewal Letter of Credit has

                                       35
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     been issued, the applicable Lenders shall be deemed to have authorized (but
     may not  require)  such L/C Issuer to permit the  renewal of such Letter of
     Credit at any time to an expiry  date not later  than the  Letter of Credit
     Expiration Date; provided,  however,  that such L/C Issuer shall not permit
     any such renewal if (A) it has determined  that it would have no obligation
     at such time to issue such Letter of Credit in its  renewed  form under the
     terms hereof (by reason of the provisions of Section 2.03(a) or otherwise),
     or (B) it has received  notice (which may be by telephone or in writing) on
     or before the day that is five Business Days before the  Nonrenewal  Notice
     Date (1) from  the  Administrative  Agent  that  the  requisite  applicable
     Lenders   have  elected  not  to  permit  such  renewal  or  (2)  from  the
     Administrative  Agent,  any Lender or the Borrower  that one or more of the
     applicable conditions specified in Section 5.02 is not then satisfied.

     (iv)  Promptly  after its delivery of any Letter of Credit or any amendment
     to a Letter of Credit to an advising  bank with  respect  thereto or to the
     beneficiary  thereof,  the  applicable  L/C Issuer will also deliver to the
     Borrower  and the  Administrative  Agent a true and  complete  copy of such
     Letter of Credit or amendment.

     (c) Drawings and Reimbursements; Funding of Participations.

     (i) Upon any drawing under any Letter of Credit,  the applicable L/C Issuer
     shall notify the Borrower and the Administrative  Agent thereof.  Not later
     than  12:00  noon on the date of any  payment  by such L/C  Issuer  under a
     Letter of Credit (each such date,  an "Honor  Date"),  the  Borrower  shall
     reimburse  such L/C Issuer  through the  Administrative  Agent in an amount
     equal to the amount of such drawing and in the Applicable Currency.  If the
     Borrower  fails  to  so  reimburse  such  L/C  Issuer  by  such  time,  the
     Administrative  Agent shall promptly notify each  applicable  Lender of the
     Honor  Date,  the amount of the  unreimbursed  drawing  (the  "Unreimbursed
     Amount"),  and the amount of such Lender's Pro Rata Share  thereof.  In the
     case of any Letter of Credit  denominated in an Alternative  Currency,  the
     Unreimbursed  Amount  shall be  redenominated  into  Dollars  and equal the
     Dollar Equivalent  Amount thereof,  and the  Administrative  Agent shall so
     notify the  applicable  Lenders in the notice  described  in the  preceding
     sentence.  In such event,  the Borrower shall be deemed to have requested a
     Committed Borrowing of Base Rate Loans to be disbursed on the Honor Date in
     an amount equal to the Unreimbursed  Amount,  without regard to the minimum
     and multiples  specified in Section 2.02 for the  principal  amount of Base
     Rate Loans,  and without regard to the amount of the unutilized  portion of
     the Aggregate Commitments and the conditions set forth in Section 5.02. Any
     notice  given by the L/C Issuers or the  Administrative  Agent  pursuant to
     this Section 2.03(c)(i) may be given by telephone if immediately  confirmed
     in writing;  provided that the lack of such an immediate confirmation shall
     not affect the conclusiveness or binding effect of such notice.

                                       36
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     (ii) Each Lender  (including any Lender acting as an L/C Issuer) shall upon
     any notice  pursuant  to Section  2.03(c)(i)  make funds  available  to the
     Administrative  Agent for the account of the  applicable  L/C Issuer at the
     Administrative  Agent's Office for Dollar denominated payments in an amount
     equal to its Pro Rata Share of the Unreimbursed  Amount not later than 1:00
     p.m. on the  Business Day  specified  in such notice by the  Administrative
     Agent, whereupon,  subject to the provisions of Section 2.03(c)(iii),  each
     Lender  that so makes  funds  available  shall  be  deemed  to have  made a
     Committed Loan that is a Base Rate Loan to the Borrower in such amount. The
     Administrative  Agent shall  remit the funds so received to the  applicable
     L/C Issuer.

     (iii) With respect to any Unreimbursed  Amount that is not fully refinanced
     by a Committed  Borrowing  of Base Rate Loans for any reason,  the Borrower
     shall be deemed to have  incurred  from the  applicable  L/C  Issuer an L/C
     Borrowing  in  the  amount  of  the  Unreimbursed  Amount  that  is  not so
     refinanced,  which  L/C  Borrowing  shall  be due  and  payable  on  demand
     (together  with  interest)  and shall bear interest at the Default Rate. In
     such event, each applicable  Lender's payment to the  Administrative  Agent
     for the account of such L/C Issuer pursuant to Section 2.03(c)(ii) shall be
     deemed  payment in respect of its  participation  in such L/C Borrowing and
     shall  constitute  an L/C Advance from such Lender in  satisfaction  of its
     participation obligation under this Section 2.03.

     (iv) Until each  applicable  Lender funds its Committed Loan or L/C Advance
     pursuant to this Section 2.03(c) to reimburse the applicable L/C Issuer for
     any amount  drawn  under any Letter of Credit,  interest in respect of such
     Lender's  Pro Rata Share of such amount  shall be solely for the account of
     such L/C Issuer.

     (v) Each  Lender's  obligation to make  Committed  Loans or L/C Advances to
     reimburse  an L/C Issuer for  amounts  drawn  under  Letters of Credit,  as
     contemplated by this Section 2.03(c),  shall be absolute and  unconditional
     and shall not be affected by any  circumstance,  including (A) any set-off,
     counterclaim,  recoupment, defense or other right that such Lender may have
     against  such L/C Issuer,  the  Borrower or any other Person for any reason
     whatsoever;  (B) the  occurrence  or  continuance  of a Default or Event of
     Default,  (C) non-compliance with the conditions set forth in Section 5.02,
     or (D) any other occurrence,  event or condition, whether or not similar to
     any of the  foregoing.  No such making of an L/C Advance  shall  relieve or
     otherwise impair the obligation of the Borrower to reimburse the applicable
     L/C Issuer for the amount of any payment  made by such L/C Issuer under any
     Letter of Credit, together with interest as provided herein.

     (vi) If any Lender fails to make available to the Administrative  Agent for
     the account of an L/C Issuer any amount  required to be paid by such Lender
     pursuant to the foregoing  provisions  of this Section  2.03(c) by the time
     specified  in Section  2.03(c)(ii),  such L/C Issuer  shall be  entitled to
     recover from such

                                       37
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     Lender (acting through the  Administrative  Agent), on demand,  such amount
     with interest thereon for the period from the date such payment is required
     to the date on which such  payment  is  immediately  available  to such L/C
     Issuer at a rate per annum  equal to the  Federal  Funds  Rate from time to
     time  in  effect.  A  certificate  of  such  L/C  Issuer  submitted  to any
     applicable  Lender (through the  Administrative  Agent) with respect to any
     amounts  owing under this clause (vi) shall be conclusive  absent  manifest
     error.

     (d) Repayment of Participations.

     (i) At any time after either L/C Issuer has made a payment under any Letter
     of Credit and has received  from any  applicable  Lender such  Lender's L/C
     Advance in respect of such payment in accordance with Section  2.03(c),  if
     the  Administrative  Agent  receives for the account of such L/C Issuer any
     payment in respect of the related  Unreimbursed  Amount or interest thereon
     (whether  directly  from the Borrower or otherwise,  including  proceeds of
     Cash  Collateral  applied  thereto  by  the   Administrative   Agent),  the
     Administrative  Agent will promptly  distribute to such Lender its Pro Rata
     Share thereof (appropriately adjusted, in the case of interest payments, to
     reflect  the period of time  during  which such  Lender's  L/C  Advance was
     outstanding)  in the same  funds as those  received  by the  Administrative
     Agent.

     (ii) If any payment received by the Administrative Agent for the account of
     an L/C Issuer  pursuant  to Section  2.03(c)(i)  is required to be returned
     under  any of the  circumstances  described  in  Section  11.06  (including
     pursuant  to  any  settlement  entered  into  by  such  L/C  Issuer  in its
     discretion),  each applicable Lender shall pay to the Administrative  Agent
     for the account of such L/C Issuer its Pro Rata Share  thereof on demand of
     the  Administrative  Agent,  plus  interest  thereon  from the date of such
     demand to the date such amount is returned  by such  Lender,  at a rate per
     annum equal to the Federal Funds Rate from time to time in effect.

     (e) Obligations  Absolute.  The obligation of the Borrower to reimburse the
     applicable  L/C Issuer for each drawing  under each Letter of Credit and to
     repay each L/C Borrowing shall be absolute,  unconditional and irrevocable,
     and shall be paid strictly in accordance  with the terms of this  Agreement
     under all circumstances, including the following:

     (i) any lack of validity or enforceability  of such Letter of Credit,  this
     Agreement,  any other Loan  Document or any other  agreement or  instrument
     relating thereto;

     (ii) the existence of any claim,  counterclaim,  set-off,  defense or other
     right that the Borrower may have at any time against any beneficiary or any
     transferee  of such  Letter  of  Credit  (or any  Person  for whom any such
     beneficiary or any such  transferee may be acting),  such L/C Issuer or any
     other Person,

                                       38
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     whether in connection with this Agreement,  the  transactions  contemplated
     hereby or by such Letter of Credit or any agreement or instrument  relating
     thereto, or any unrelated transaction;

     (iii) any draft, demand, certificate or other document presented under such
     Letter of Credit proving to be forged, fraudulent,  invalid or insufficient
     in any respect or any  statement  therein being untrue or inaccurate in any
     respect;  or any loss or  delay in the  transmission  or  otherwise  of any
     document required in order to make a drawing under such Letter of Credit;

     (iv) any  payment by such L/C Issuer  under such  Letter of Credit  against
     presentation  of a draft or certificate  that does not strictly comply with
     the terms of such Letter of Credit;  or any payment made by such L/C Issuer
     under  such  Letter of Credit to any Person  purporting  to be a trustee in
     bankruptcy,  debtor-in-possession,  assignee for the benefit of  creditors,
     liquidator,  receiver  or  other  representative  of or  successor  to  any
     beneficiary  or any  transferee  of such  Letter of Credit,  including  any
     arising in connection with any proceeding under any Debtor Relief Law; or

     (v) any other circumstance or happening whatsoever,  whether or not similar
     to any of the  foregoing,  including  any  other  circumstance  that  might
     otherwise  constitute  a defense  available  to,  or a  discharge  of,  the
     Borrower.

     The  Borrower  shall  promptly  examine a copy of each Letter of Credit and
     each  amendment  thereto  that is  delivered to it and, in the event of any
     claim  of   noncompliance   with  the  Borrower's   instructions  or  other
     irregularity,  the Borrower  will  immediately  notify the  applicable  L/C
     Issuer.  The Borrower shall be conclusively  deemed to have waived any such
     claim against such L/C Issuer and its correspondents  unless such notice is
     given as aforesaid.

     (f) Role of L/C Issuer.  Each Lender and the Borrower agree that, in paying
     any drawing  under a Letter of Credit,  the L/C Issuers  shall not have any
     responsibility  to  obtain  any  document  (other  than  any  sight  draft,
     certificates and documents  expressly  required by the Letter of Credit) or
     to ascertain or inquire as to the validity or accuracy of any such document
     or the authority of the Person  executing or delivering  any such document.
     None of the L/C Issuers, any Agent-Related Person nor any of the respective
     correspondents,  participants  or  assignees  of the L/C  Issuers  shall be
     liable to any  Lender for (i) any  action  taken or  omitted in  connection
     herewith at the request or with the  approval of the  requisite  applicable
     Lenders;  (ii)  any  action  taken  or  omitted  in the  absence  of  gross
     negligence   or   willful   misconduct;   or  (iii)   the  due   execution,
     effectiveness,  validity or  enforceability  of any document or  instrument
     related  to any  Letter of Credit  or  Letter  of Credit  Application.  The
     Borrower  hereby  assumes  all  risks  of  the  acts  or  omissions  of any
     beneficiary or transferee  with respect to its use of any Letter of Credit;
     provided,  however, that this assumption is not intended to, and shall not,
     preclude the  Borrower's  pursuing  such rights and remedies as it may have
     against the beneficiary or transferee at law or under any other  agreement.
     None  of  the  L/C
                                       39
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     Issuers,   any   Agent-Related   Person,   nor   any  of   the   respective
     correspondents,  participants  or assignees  of the L/C  Issuers,  shall be
     liable or  responsible  for any of the  matters  described  in clauses  (i)
     through (v) of Section 2.03(e);  provided,  however,  that anything in such
     clauses to the  contrary  notwithstanding,  the  Borrower  may have a claim
     against an L/C Issuer,  and such L/C Issuer may be liable to the  Borrower,
     to the  extent,  but only to the  extent,  of any  direct,  as  opposed  to
     consequential  or  exemplary,  damages  suffered by the  Borrower  that the
     Borrower  proves were caused by such L/C  Issuer's  willful  misconduct  or
     gross  negligence  or such L/C  Issuer's  willful  failure to pay under any
     Letter of Credit after the presentation to it by the beneficiary of a sight
     draft and  certificate(s)  strictly complying with the terms and conditions
     of a  Letter  of  Credit.  In  furtherance  and  not in  limitation  of the
     foregoing,  the L/C Issuers may accept  documents that appear on their face
     to  be  in  order,  without   responsibility  for  further   investigation,
     regardless  of any  notice  or  information  to the  contrary,  and the L/C
     Issuers shall not be  responsible  for the validity or  sufficiency  of any
     instrument  transferring or assigning or purporting to transfer or assign a
     Letter of Credit or the rights or benefits  thereunder or proceeds thereof,
     in whole or in part,  that may prove to be invalid or  ineffective  for any
     reason.

     (g) Cash  Collateral.  (i) If an L/C Issuer has honored any full or partial
     drawing request under any Letter of Credit and such drawing has resulted in
     an L/C Borrowing,  or (ii) if, as of the Letter of Credit  Expiration Date,
     any Letter of Credit may for any reason remain outstanding and partially or
     wholly undrawn,  the Borrower shall immediately Cash Collateralize the then
     Outstanding Amount of all L/C Obligations (in an amount equal to the Dollar
     Equivalent of such Outstanding Amount determined as of the date of such L/C
     Borrowing or the Letter of Credit Expiration Date, as the case may be). For
     purposes hereof,  "Cash  Collateralize" means to pledge and deposit with or
     deliver to the Administrative Agent, for the benefit of the L/C Issuers and
     the Lenders, as collateral for the L/C Obligations, cash or deposit account
     balances  pursuant to documentation  in form and substance  satisfactory to
     the Administrative Agent and the applicable L/C Issuer (which documents are
     hereby  consented  to by  the  Lenders).  Derivatives  of  such  term  have
     corresponding  meanings.  The Borrower hereby grants to the  Administrative
     Agent,  for the  benefit of the L/C  Issuers  and the  Lenders,  a security
     interest in all such cash,  deposit  accounts and all balances  therein and
     all proceeds of the  foregoing.  Cash  collateral  shall be  maintained  in
     blocked,  non-interest  bearing  deposit  accounts  at the  applicable  L/C
     Issuer.  The  Administrative  Agent may,  at any time and from time to time
     after the initial deposit of Cash Collateral,  request that additional Cash
     Collateral be provided in order to protect  against the results of exchange
     rate fluctuations.

     (h)  Applicability of ISP98 and UCP. Unless  otherwise  expressly agreed by
     the  applicable  L/C  Issuer  and the  Borrower  when a Letter of Credit is
     issued  (including any such agreement  applicable to an Existing  Letter of
     Credit),  (i) the  rules  of the  "International  Standby  Practices  1998"
     published by the Institute of International Banking Law & Practice (or such
     later  version  thereof as may be in effect at the time of issuance)  shall
     apply to each standby  Letter of Credit,  and (ii) the rules of the Uniform
     Customs and Practice for Documentary Credits, as most recently published by
     the

                                       40
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     International  Chamber  of  Commerce  (the  "ICC") at the time of  issuance
     (including  the  ICC  decision  published  by  the  Commission  on  Banking
     Technique  and  Practice on April 6, 1998  regarding  the  European  single
     currency (euro)) shall apply to each commercial Letter of Credit.

     (i) Letter of Credit Fees.  The Borrower shall pay Letter of Credit fees as
     set forth in Section 2.09.

     (j)  Conflict  with  Letter  of  Credit  Application.  In the  event of any
     conflict  between  the terms  hereof  and the terms of any Letter of Credit
     Application, the terms hereof shall control.

     2.04 Swing Line Loans.

     (a) Swing Line Loans. Subject to the terms and conditions set forth herein,
     the Swing Line  Lender  agrees to make  revolving  loans (the  "Swing  Line
     Loans"  ) to the  Borrower  in  Dollars  on any  Business  Day  during  the
     Availability  Period;  provided that (i) the aggregate  principal amount of
     Swing Line Loans shall not exceed THIRTY-FIVE MILLION DOLLARS ($35,000,000)
     (as such  amount may be  increased  or  decreased  in  accordance  with the
     provisions  hereof,  the "Swing  Line  Sublimit"),  (ii) with regard to the
     Domestic Lenders  collectively,  the aggregate principal amount of Domestic
     Loan Obligations shall not exceed the Aggregate Domestic  Commitments,  and
     (iii) with  regard to each  Domestic  Lender  individually,  such  Lender's
     Domestic Pro Rata Share of the Domestic Loan  Obligations  shall not exceed
     its  respective  Domestic  Commitment.  Swing Line Loans shall be comprised
     solely of Base Rate Loans,  and may be repaid and  reborrowed in accordance
     with the  provisions  hereof.  Immediately  upon the making of a Swing Line
     Loan, each Domestic  Lender shall be deemed to, and hereby  irrevocably and
     unconditionally   agrees  to,   purchase  from  the  Swing  Line  Lender  a
     participation  interest  in such Swing Line Loan in an amount  equal to its
     Domestic Pro Rata Share thereof.

     (b) Borrowing Procedures.  Each Swing Line Borrowing shall be made upon the
     Borrower's   irrevocable   notice  to  the  Swing   Line   Lender  and  the
     Administrative  Agent,  which may be given by  telephone.  Each such notice
     must be received by the Swing Line Lender and the Administrative  Agent not
     later than 2:00 p.m. on the requested borrowing date, and shall specify (i)
     the amount to be  borrowed,  which  shall be a minimum of  $500,000,  and a
     multiple of $100,000 in excess  thereof,  and (ii) the requested  borrowing
     date,  which shall be a Business Day. Each such  telephonic  notice must be
     confirmed   promptly   by  delivery  to  the  Swing  Line  Lender  and  the
     Administrative  Agent of a written  Swing Line Loan  Notice,  appropriately
     completed  and signed by a Responsible  Officer of the  Borrower.  Promptly
     after  receipt by the Swing Line Lender of any  telephonic  Swing Line Loan
     Notice,  the Swing Line Lender will confirm with the  Administrative  Agent
     (by  telephone  or in  writing)  that  the  Administrative  Agent  has also
     received  such Swing Line Loan Notice  and,  if not,  the Swing Line Lender
     will notify the  Administrative  Agent (by  telephone or in writing) of the
     contents  thereof.  Unless the Swing Line  Lender has  received  notice (by
     telephone or in writing)

                                       41
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     from the  Administrative  Agent  (including  at the  request of any Lender)
     prior to 12:00 noon on the date of the proposed  Swing Line  Borrowing  (A)
     directing  the Swing  Line  Lender  not to make such  Swing  Line Loan as a
     result of the limitations set forth in the proviso to the first sentence of
     Section  2.04(a),  or (B)  that  one or more of the  applicable  conditions
     specified in Article V is not then  satisfied,  then,  subject to the terms
     and conditions hereof, the Swing Line Lender will, not later than 3:00 p.m.
     on the borrowing  date  specified in such Swing Line Loan Notice,  make the
     amount of its Swing Line Loan available to the Borrower.

     (c) Refinancing of Swing Line Loans.

     (i) The Swing Line Lender at any time in its sole and  absolute  discretion
     may request,  on behalf of the Borrower (which hereby irrevocably  requests
     and  authorizes  the Swing Line Lender to so request on its  behalf),  that
     each  Domestic  Lender make a Domestic  Committed  Loan that is a Base Rate
     Loan in an amount  equal to such  Lender's  Domestic  Pro Rata Share of the
     amount of Swing Line Loans then outstanding.  Such request shall be made in
     writing  (which  written  request  shall be deemed to be a  Committed  Loan
     Notice for purposes  hereof) and in  accordance  with the  requirements  of
     Section 2.02, without regard to the minimum and multiples specified therein
     for the  principal  amount of Base Rate Loans,  and  without  regard to the
     unutilized portion of the Aggregate Domestic  Commitments or the conditions
     set forth in Section 5.02. The Swing Line Lender shall furnish the Borrower
     with  a  copy  of the  applicable  Committed  Loan  Notice  promptly  after
     delivering such notice to the  Administrative  Agent.  Each Domestic Lender
     shall  make an amount  equal to its  Domestic  Pro Rata Share of the amount
     specified in such  Committed  Loan Notice  available to the  Administrative
     Agent in  immediately  available  funds for the  account  of the Swing Line
     Lender at the Administrative Agent's Office not later than 2:00 p.m. on the
     day specified in such Committed Loan Notice, whereupon,  subject to Section
     2.04(c)(ii),  each Domestic  Lender that so makes funds  available shall be
     deemed to have made a Domestic  Committed  Loan that is a Base Rate Loan to
     the Borrower in such amount. The Administrative Agent shall remit the funds
     so received to the Swing Line Lender.

     (ii) If for any reason any Swing Line Loan cannot be  refinanced  by such a
     Domestic  Committed  Borrowing in accordance with Section  2.04(c)(i),  the
     request for Domestic  Committed Loans that are Base Rate Loans submitted by
     the Swing Line Lender as set forth  herein  shall be deemed to be a request
     by the Swing Line Lender that each of the  Domestic  Lenders  fund its risk
     participation  in the relevant  Swing Line Loan and each Domestic  Lender's
     payment  to the  Administrative  Agent for the  account  of the Swing  Line
     Lender pursuant to Section 2.04(c)(i) shall be deemed payment in respect of
     such participation.

     (iii) If any Domestic Lender fails to make available to the  Administrative
     Agent for the  account of the Swing Line  Lender any amount  required to be
     paid by such Lender  pursuant to the  foregoing  provisions of this Section
     2.04(c) by

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     the time  specified in Section  2.04(c)(i),  the Swing Line Lender shall be
     entitled to recover  from such Lender  (acting  through the  Administrative
     Agent),  on demand,  such amount with interest  thereon for the period from
     the date such  payment is  required  to the date on which  such  payment is
     immediately available to the Swing Line Lender at a rate per annum equal to
     the Federal Funds Rate from time to time in effect.  A  certificate  of the
     Swing  Line  Lender   submitted  to  any  Domestic   Lender   (through  the
     Administrative  Agent) with respect to any amounts  owing under this clause
     (iii) shall be conclusive absent manifest error.

     (iv) Each Domestic Lender's  obligation to make Domestic Committed Loans or
     to purchase and fund risk  participations  in Swing Line Loans  pursuant to
     this Section 2.04(c) shall be absolute and  unconditional  and shall not be
     affected by any  circumstance,  including  (A) any  set-off,  counterclaim,
     recoupment,  defense or other right that such  Lender may have  against the
     Swing  Line  Lender,  the  Borrower  or any  other  Person  for any  reason
     whatsoever,  (B) the  occurrence  or  continuance  of a Default or Event of
     Default,  (C) the  conditions  set forth in Section  5.02, or (D) any other
     occurrence,  event  or  condition,  whether  or not  similar  to any of the
     foregoing. No such purchase or funding of risk participations shall relieve
     or  otherwise  impair the  obligation  of the  Borrower to repay Swing Line
     Loans, together with interest as provided herein.

     (d) Repayment of Participations.

     (i) At any time after any Domestic  Lender has  purchased and funded a risk
     participation  in a Swing Line Loan, if the Swing Line Lender  receives any
     payment on account of such  Swing  Line Loan,  the Swing Line  Lender  will
     distribute  to such  Lender its  Domestic  Pro Rata  Share of such  payment
     (appropriately  adjusted,  in the case of interest payments, to reflect the
     period of time during which such Lender's risk participation was funded) in
     the same funds as those received by the Swing Line Lender.

     (ii) If any  payment  received  by the  Swing  Line  Lender in  respect  of
     principal  or interest on any Swing Line Loan is required to be returned by
     the Swing Line Lender under any of the  circumstances  described in Section
     11.06 (including  pursuant to any settlement entered into by the Swing Line
     Lender in its discretion), each Domestic Lender shall pay to the Swing Line
     Lender its Domestic Pro Rata Share thereof on demand of the  Administrative
     Agent,  plus interest thereon from the date of such demand to the date such
     amount is  returned,  at a rate per annum equal to the Federal  Funds Rate.
     The  Administrative  Agent will make such  demand  upon the  request of the
     Swing Line Lender.

     (e) Interest for Account of Swing Line Lender.  The Swing Line Lender shall
     be  responsible  for  invoicing the Borrower for interest on the Swing Line
     Loans. Until each Domestic Lender funds its Domestic Committed Loan or risk
     participation  pursuant to this  Section 2.04 to  refinance  such  Lender's
     Domestic Pro Rata Share of any Swing

                                       43
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     Line Loan,  interest  in respect of such Pro Rata Share shall be solely for
     the account of the Swing Line Lender.

     (f)  Payments  Directly to Swing Line Lender.  The Borrower  shall make all
     payments  of  principal  and  interest  in  respect of the Swing Line Loans
     directly to the Swing Line Lender.

     2.05 Prepayments.

     (a) The Borrower may,  upon notice from the Borrower to the  Administrative
     Agent, at any time or from time to time voluntarily  prepay Committed Loans
     in whole or in part  without  premium or  penalty;  provided  that (i) such
     notice must be received  by the  Administrative  Agent not later than 12:00
     noon  (A)  three   Business  Days  prior  to  any  date  of  prepayment  of
     Eurocurrency Rate Loans denominated in Dollars,  (B) four Business Days (or
     five  Business  Days in the  case of  prepayment  of Loans  denominated  in
     Special Notice  Currencies) prior to any date of prepayment of Eurocurrency
     Rate Loans  denominated in Alternative  Currencies,  and (C) on the date of
     prepayment of Base Rate Loans;  (ii) any  prepayment of  Eurocurrency  Rate
     Loans shall be in a principal  amount of $5,000,000 or a whole  multiple of
     $1,000,000 in excess  thereof;  and (iii) any prepayment of Base Rate Loans
     shall be in a principal  amount of $500,000 or a whole multiple of $100,000
     in excess  thereof or, in each case, if less, the entire  principal  amount
     thereof  then  outstanding.  Each such  notice  shall  specify the date and
     amount of such  prepayment,  the Type(s) of Committed  Loans to be prepaid,
     and the amount of such prepayment to be applied to Domestic Committed Loans
     and to  Multicurrency  Committed  Loans (provided that if the Borrower does
     not specify the Committed  Loans to which such prepayment is to be applied,
     such  prepayment   shall  be  applied  pro  rata  to  all  Committed  Loans
     outstanding on the date thereof).  The  Administrative  Agent will promptly
     notify each  applicable  Lender of its receipt of each such notice,  and of
     the  amount of such  Lender's  Pro Rata Share of such  prepayment.  If such
     notice is given by the Borrower,  the Borrower  shall make such  prepayment
     and the payment amount specified in such notice shall be due and payable on
     the date specified  therein.  Any  prepayment of a  Eurocurrency  Rate Loan
     shall be accompanied  by all accrued  interest  thereon,  together with any
     additional  amounts required pursuant to Section 3.05. Each such prepayment
     shall be  applied  to the  applicable  Committed  Loans of the  Lenders  in
     accordance with their respective Pro Rata Shares thereof.

     (b) The Borrower  may, upon notice to the Swing Line Lender (with a copy to
     the  Administrative  Agent), at any time or from time to time,  voluntarily
     prepay  Swing Line Loans in whole or in part  without  premium or  penalty;
     provided that (i) such notice must be received by the Swing Line Lender and
     the  Administrative  Agent  not later  than  2:00  p.m.  on the date of the
     prepayment,  and (ii) any such prepayment  shall be in a minimum  principal
     amount of $100,000.  Each such notice shall  specify the date and amount of
     such  prepayment.  If such notice is given by the  Borrower,  the  Borrower
     shall make such prepayment and the payment amount  specified in such notice
     shall be due and payable on the date specified therein.

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     (c) If at any time (i) the  outstanding  principal  amount of Domestic Loan
     Obligations shall be in excess of the Aggregate Domestic Commitments,  (ii)
     the outstanding  principal  amount of Domestic L/C Obligations  shall be in
     excess of the Domestic Letter of Credit Sublimit,  or (iii) the outstanding
     principal  amount of Swing Line Loans  shall be in excess of the Swing Line
     Sublimit,  the Borrower shall, within two Business Days, make prepayment on
     or provide cash  collateral in respect of the Domestic Loan  Obligations in
     an amount sufficient to eliminate the difference.

     (d) If at any time (i) the outstanding  principal  amount of  Multicurrency
     Loan  Obligations  shall  be  in  excess  of  the  Aggregate  Multicurrency
     Commitments,  or (ii) the outstanding principal amount of Multicurrency L/C
     Obligations  shall be in  excess  of the  Multicurrency  Letter  of  Credit
     Sublimit,  the Borrower shall, within two Business Days, make prepayment on
     or provide cash collateral in respect of the Multicurrency Loan Obligations
     in an amount  sufficient to eliminate the  difference.  The  Administrative
     Agent may, at any time and from time to time after the  initial  deposit of
     such Cash  Collateral,  request  additional  cash collateral be provided in
     order to protect against the results of further exchange rate fluctuations.

     2.06 Termination or Reduction of Commitments.

     The  Borrower  may,  upon  notice from the  Borrower to the  Administrative
     Agent,  terminate  the  Aggregate  Commitments  or  permanently  reduce the
     Aggregate  Commitments to an amount not less than the Outstanding Amount of
     Loans  and L/C  Obligations;  provided  that (i) any such  notice  shall be
     received  by the  Administrative  Agent  not  later  than  12:00  noon five
     Business  Days prior to the date of  termination  or  reduction,  (ii) such
     notice shall specify  whether such  reduction is of the Aggregate  Domestic
     Commitments or of the Aggregate Multicurrency Commitments (provided that if
     the Borrower fails to specify  application of such  reduction,  it shall be
     applied pro rata to the Aggregate  Domestic  Commitments  and the Aggregate
     Multicurrency  Commitments),  and (iii) any such partial reduction shall be
     in an aggregate  amount of  $10,000,000 or any whole multiple of $1,000,000
     in excess  thereof.  The  Administrative  Agent  will  promptly  notify the
     Lenders of any such notice of  termination  or reduction  of the  Aggregate
     Commitments.  Any reduction of the Aggregate Domestic Commitments or of the
     Aggregate  Multicurrency  Commitments shall be applied to the Commitment of
     each Lender according to its Pro Rata Share thereof.  All facility fees and
     utilization fees accrued until the effective date of any termination of the
     Aggregate  Commitments  shall  be  paid  on  the  effective  date  of  such
     termination.

     2.07 Repayment of Loans.

     (a) The  Borrower  shall  repay to the  Lenders  on the  Maturity  Date the
     aggregate principal amount of Committed Loans outstanding on such date.

     (b) The  Borrower  shall repay each Swing Line Loan on the earlier to occur
     of (i) the date five  Business  Days  after  such Loan is made and (ii) the
     Maturity Date.

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     2.08 Interest.

     (a)  Subject  to  the  provisions  of  subsection   (b)  below,   (i)  each
     Eurocurrency  Rate Loan shall bear  interest on the  outstanding  principal
     amount  thereof for each  Interest  Period at a rate per annum equal to the
     sum of (A) the Adjusted Eurocurrency Rate for such Interest Period plus (B)
     the Applicable Rate plus (C) without  duplication,  for any Interest Period
     with respect to any Eurocurrency Rate Loan advanced by a Lender required to
     comply  with  the  relevant  requirements  of the Bank of  England  and the
     Financial Services Authority of the United Kingdom, the Mandatory Cost Rate
     for such Interest  Period;  (ii) each Base Rate Loan shall bear interest on
     the outstanding principal amount thereof from the applicable borrowing date
     at a rate per annum equal to the Base Rate plus the  Applicable  Rate;  and
     (iii) each Swing Line Loan shall bear interest on the outstanding principal
     amount thereof from the applicable borrowing date at a rate per annum equal
     to the Base Rate plus the Applicable Rate.

     (b) If any amount  payable by the Borrower  under any Loan  Document is not
     paid when due (without regard to any applicable grace periods),  whether at
     stated maturity, by acceleration or otherwise, such amount shall thereafter
     bear interest at a  fluctuating  interest rate per annum at all times equal
     to the Default Rate to the fullest  extent  permitted by  applicable  Laws.
     Furthermore,  while any Event of Default  exists,  the  Borrower  shall pay
     interest on the principal amount of all outstanding  Obligations  hereunder
     at a fluctuating  interest rate per annum at all times equal to the Default
     Rate to the fullest extent permitted by applicable Laws. Accrued and unpaid
     interest on past due  amounts  (including  interest  on past due  interest)
     shall be due and payable upon demand.

     (c)  Interest  on each Loan  shall be due and  payable  in  arrears on each
     Interest Payment Date applicable  thereto and at such other times as may be
     specified herein. Interest hereunder shall be due and payable in accordance
     with the terms hereof before and after  judgment,  and before and after the
     commencement of any proceeding under any Debtor Relief Law.

     (d) For the purposes of the Interest Act  (Canada),  (i) whenever a rate of
     interest or fee rate  hereunder is  calculated  on the basis of a year (the
     "deemed  year") that contains  fewer days than the actual number of days in
     the calendar year of  calculation,  such rate of interest or fee rate shall
     be expressed as a yearly rate by  multiplying  such rate of interest or fee
     rate by the actual number of days in the calendar year of  calculation  and
     dividing it by the number of days in the deemed year, (ii) the principle of
     deemed reinvestment of interest shall not apply to any interest calculation
     hereunder and (iii) the rates of interest stipulated herein are intended to
     be nominal rates and not effective rates or yields.

     2.09 Fees.

     (a) Facility Fees.

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     (i) Domestic  Facility Fees.  The Borrower shall pay to the  Administrative
     Agent  for the  account  of each  Domestic  Lender in  accordance  with its
     Domestic Pro Rata Share,  a facility fee in Dollars equal to the Applicable
     Rate times the actual daily amount of the  Aggregate  Domestic  Commitments
     (or,  if  the  Aggregate  Domestic  Commitments  have  terminated,  on  the
     Outstanding Amount of all Domestic Loan Obligations),  regardless of usage.
     Such facility fee shall accrue at all times during the Availability  Period
     (and   thereafter  so  long  as  any  Domestic  Loan   Obligations   remain
     outstanding),  including  at any  time  during  which  one or  more  of the
     conditions in Article V is not met.

     (ii)   Multicurrency   Facility   Fees.  The  Borrower  shall  pay  to  the
     Administrative  Agent  for the  account  of each  Multicurrency  Lender  in
     accordance with its Multicurrency Pro Rata Share, a facility fee in Dollars
     equal to the Applicable Rate times the actual daily amount of the Aggregate
     Multicurrency  Commitments (or, if the Aggregate Multicurrency  Commitments
     have  terminated,  on the  Outstanding  Amount  of all  Multicurrency  Loan
     Obligations),  regardless  of usage.  Such facility fee shall accrue at all
     times  during  the  Availability  Period  (and  thereafter  so  long as any
     Multicurrency Loan Obligations remain  outstanding),  including at any time
     during which one or more of the conditions in Article V is not met.

     The  facility  fees set  forth  in this  Section  2.09(a)  shall be due and
     payable quarterly in arrears on the last Business Day of each March,  June,
     September and December,  commencing with the first such date to occur after
     the Closing Date, and on the Maturity Date (and, if applicable,  thereafter
     on demand). The facility fees shall be calculated quarterly in arrears, and
     if there is any  change in the  Applicable  Rate  during any  quarter,  the
     actual daily amount shall be computed and multiplied by the Applicable Rate
     separately  for each period during such quarter that such  Applicable  Rate
     was in effect.

     (b) Utilization Fees.

     (i) Domestic Utilization Fees. The Borrower shall pay to the Administrative
     Agent  for the  account  of each  Domestic  Lender in  accordance  with its
     Domestic  Pro  Rata  Share,  a  utilization  fee in  Dollars  equal  to the
     Applicable  Rate times the Domestic Loan  Obligations  on each day that the
     Domestic  Loan  Obligations  exceed 40% of the actual  daily  amount of the
     Aggregate Domestic Commitments.

     (ii)  Multicurrency  Utilization  Fees.  The  Borrower  shall  pay  to  the
     Administrative  Agent  for the  account  of each  Multicurrency  Lender  in
     accordance  with its  Multicurrency  Pro Rata Share,  a utilization  fee in
     Dollars  equal  to  the  Applicable  Rate  times  the  Multicurrency   Loan
     Obligations on each day that the Multicurrency  Loan Obligations exceed 40%
     of the actual daily amount of the Aggregate Multicurrency Commitments.

                                       47
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     The  utilization  fees set forth in this Section  2.09(b)  shall be due and
     payable quarterly in arrears on the last Business Day of each March,  June,
     September and December,  commencing with the first such date to occur after
     the Closing Date, and on the Maturity Date. The  utilization  fees shall be
     calculated  quarterly  in  arrears  and  if  there  is  any  change  in the
     Applicable Rate during any quarter,  the daily amount shall be computed and
     multiplied  by the  Applicable  Rate  for each  period  during  which  such
     Applicable  Rate was in effect.  The  utilization  fees shall accrue at all
     times,  including at any time during which one or more of the conditions in
     Article V is not met.

     (c) Letter of Credit Fees.

     (i)  Domestic  Letter of Credit  Fees.  The  Borrower  shall pay (A) to the
     Administrative  Agent for the account of each Domestic Lender in accordance
     with its Domestic  Pro Rata Share a Letter of Credit fee for each  Domestic
     Letter of Credit equal to the Applicable  Rate times the Dollar  Equivalent
     of the daily  maximum  amount  available  to be drawn  under such Letter of
     Credit  (whether or not such  maximum  amount is then in effect  under such
     Letter of Credit) and (B)  directly to the  Domestic L/C Issuer for its own
     account a fronting fee with respect to each Domestic Letter of Credit in an
     amount equal to 1/8 of 1% per annum on the Dollar  Equivalent  of the daily
     maximum amount available to be drawn thereunder.

     (ii) Multicurrency Letter of Credit Fees. The Borrower shall pay (A) to the
     Administrative  Agent  for the  account  of each  Multicurrency  Lender  in
     accordance with its Multicurrency Pro Rata Share a Letter of Credit fee for
     each Multicurrency  Letter of Credit equal to the Applicable Rate times the
     Dollar  Equivalent of the daily maximum amount  available to be drawn under
     such Letter of Credit (whether or not such maximum amount is then in effect
     under such Letter of Credit)  and (B)  directly  to the  Multicurrency  L/C
     Issuer  for  its  own  account  a  fronting   fee  with   respect  to  each
     Multicurrency Letter of Credit in an amount equal to 1/8 of 1% per annum on
     the Dollar  Equivalent  of the daily maximum  amount  available to be drawn
     thereunder.

     The  letter  of  credit  fees set forth in this  Section  2.09(c)  shall be
     computed  on a  quarterly  basis in arrears and shall be due and payable on
     the  last  Business  Day  of  each  March,  June,  September  and  December
     (commencing  with the first such date to occur  after the  issuance of such
     Letter of Credit) and on the Letter of Credit  Expiration Date. If there is
     any change in the  Applicable  Rate during any quarter,  the daily  maximum
     amount of each Letter of Credit  shall be computed  and  multiplied  by the
     Applicable  Rate  separately  for each period during such quarter that such
     Applicable Rate was in effect. In addition, the Borrower shall pay directly
     to the  applicable  L/C Issuer for its own account the customary  issuance,
     presentation, amendment and other processing fees, and other standard costs
     and charges,  of such L/C Issuer relating to letters of credit as from time
     to time in effect.  Such fees and charges are due and payable on demand and
     are nonrefundable.

                                       48
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     (d) Other Fees.

     (i) The Borrower shall pay to the Arranger and the Administrative Agent for
     their  own  respective  accounts  fees  in the  amounts  and  at the  times
     specified in the Fee Letter.  Such fees shall be fully earned when paid and
     shall not be refundable for any reason whatsoever.

     (ii) The  Borrower  shall pay to the  Lenders  such fees as shall have been
     separately  agreed  upon in  writing  in the  amounts  and at the  times so
     specified.  Such  fees  shall be fully  earned  when  paid and shall not be
     refundable for any reason whatsoever.

     2.10 Computation of Interest and Fees.

     All  computations  of  interest  for Base Rate  Loans when the Base Rate is
     determined by Bank of America's  "prime rate" shall be made on the basis of
     a year of 365 or 366 days, as the case may be, and actual days elapsed. All
     other  computations  of fees and  interest  shall be made on the basis of a
     360-day  year and  actual  days  elapsed  (which  results  in more  fees or
     interest,  as  applicable,  being paid than if  computed  on the basis of a
     365-day  year) or, in the case of interest in respect of Loans  denominated
     in  Alternative  Currencies  as to which market  practice  differs from the
     foregoing,  in accordance with such market practice.  Interest shall accrue
     on each Loan for the day on which the Loan is made, and shall not accrue on
     a Loan,  or any  portion  thereof,  for the day on  which  the Loan or such
     portion is paid,  provided  that any Loan that is repaid on the same day on
     which it is made shall,  subject to Section 2.12(a),  bear interest for one
     day.

     2.11 Evidence of Debt.

     (a) The Credit  Extensions made by each Lender shall be evidenced by one or
     more   accounts   or  records   maintained   by  such  Lender  and  by  the
     Administrative  Agent in the ordinary  course of business.  The accounts or
     records  maintained  by the  Administrative  Agent and each Lender shall be
     conclusive  absent  manifest  error of the amount of the Credit  Extensions
     made by the Lenders to the Borrower and the interest and payments  thereon.
     Any failure to so record or any error in doing so shall not, however, limit
     or otherwise  affect the  obligation  of the Borrower  hereunder to pay any
     amount owing with respect to the Obligations.  In the event of any conflict
     between the accounts and records  maintained by any Lender and the accounts
     and records of the  Administrative  Agent in respect of such  matters,  the
     accounts  and  records of the  Administrative  Agent  shall  control in the
     absence of manifest error.  Upon the request of any Lender made through the
     Administrative Agent, the Borrower shall execute and deliver to such Lender
     (through  the  Administrative  Agent) a Note,  which  shall  evidence  such
     Lender's  Loans in  addition to such  accounts or records.  Each Lender may
     attach  schedules  to its Note  and  endorse  thereon  the  date,  Type (if
     applicable),  amount and  maturity of its Loans and  payments  with respect
     thereto.

                                       49
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     (b) In addition to the accounts and records  referred to in subsection (a),
     each Lender and the Administrative  Agent shall maintain in accordance with
     its usual practice  accounts or records  evidencing the purchases and sales
     by such Lender of participations in Letters of Credit and Swing Line Loans.
     In the event of any conflict between the accounts and records maintained by
     the  Administrative  Agent and the  accounts  and  records of any Lender in
     respect of such  matters,  the accounts  and records of the  Administrative
     Agent shall control in the absence of manifest error.

     2.12 Payments Generally.

     (a) All payments to be made by the Borrower shall be made without condition
     or deduction for any counterclaim, defense, recoupment or setoff. Except as
     otherwise expressly provided herein and except with respect to principal of
     and interest on Loans denominated in Alternative Currency,  all payments by
     the Borrower hereunder shall be made to the  Administrative  Agent, for the
     account of the  respective  Lenders to which such  payment is owed,  at the
     Administrative  Agent's  Office in Dollars  and in Same Day Funds not later
     than 2:00 p.m. on the date specified herein.  Except as otherwise expressly
     provided  herein,  all payments by the Borrower  hereunder  with respect to
     principal  of and interest on Loans  denominated  in  Alternative  Currency
     shall  be  made  to  the  Administrative  Agent,  for  the  account  of the
     respective  Lenders to which such  payment is owed,  at the  Administrative
     Agent's Office in such Alternative Currency and in Same Day Funds not later
     than the Applicable Time specified by the Administrative Agent on the dates
     specified herein. The Administrative Agent will promptly distribute to each
     Lender its Pro Rata Share (or other applicable share as provided herein) of
     such  payment in like funds as received by wire  transfer to such  Lender's
     Lending Office. All payments received by the Administrative Agent (i) after
     2:00 p.m., in the case of payments in Dollars, or (ii) after the Applicable
     Time  specified by the  Administrative  Agent in the case of payments in an
     Alternative  Currency,  shall in each case be deemed  received  on the next
     succeeding  Business Day and any applicable  interest or fee shall continue
     to accrue.

     (b) Subject to the  definition  of "Interest  Period," if any payment to be
     made by the  Borrower  shall come due on a day other  than a Business  Day,
     payment  shall  be  made on the  next  following  Business  Day,  and  such
     extension of time shall be reflected in computing  interest or fees, as the
     case may be.

     (c) If at any time insufficient  funds are received by and available to the
     Administrative Agent to pay fully all amounts of principal, L/C Borrowings,
     interest  and fees then due  hereunder,  such funds  shall be  applied  (i)
     first,  toward costs and  expenses  (including  Attorney  Costs and amounts
     payable under Article III)  incurred by the  Administrative  Agent and each
     Lender,  (ii)  second,  toward  repayment  of  interest  and fees  then due
     hereunder,  ratably among the parties  entitled  thereto in accordance with
     the amounts of interest and fees then due to such parties, and (iii) third,
     toward  repayment  of  principal  and L/C  Borrowings  then due  hereunder,
     ratably among the parties  entitled  thereto in accordance with the amounts
     of principal and L/C Borrowings then due to such parties.

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     (d) Unless the  Borrower  or any Lender  has  notified  the  Administrative
     Agent,  prior to the date any  payment is  required to be made by it to the
     Administrative  Agent hereunder,  that the Borrower or such Lender,  as the
     case may be,  will not make  such  payment,  the  Administrative  Agent may
     assume  that the  Borrower or such  Lender,  as the case may be, has timely
     made such  payment and may (but shall not be so  required  to), in reliance
     thereon,  make  available  a  corresponding  amount to the Person  entitled
     thereto. If and to the extent that such payment was not in fact made to the
     Administrative Agent in Same Day Funds, then:

     (i) if the  Borrower  failed  to  make  such  payment,  each  Lender  shall
     forthwith on demand repay to the  Administrative  Agent the portion of such
     assumed  payment that was made  available to such Lender in Same Day Funds,
     together  with  interest  thereon in respect of each day from and including
     the date such amount was made available by the Administrative Agent to such
     Lender to the date such  amount  is repaid to the  Administrative  Agent in
     Same Day  Funds  at the  applicable  Overnight  Rate  from  time to time in
     effect; and

     (ii) if any Lender failed to make such payment, such Lender shall forthwith
     on demand pay to the  Administrative  Agent the amount  thereof in Same Day
     Funds,  together  with  interest  thereon for the period from the date such
     amount was made  available by the  Administrative  Agent to the Borrower to
     the  date  such  amount  is  recovered  by the  Administrative  Agent  (the
     "Compensation  Period")  at a  rate  per  annum  equal  to  the  applicable
     Overnight Rate from time to time in effect. If such Lender pays such amount
     to the  Administrative  Agent,  then  such  amount  shall  constitute  such
     Lender's  Committed  Loan  included in the  applicable  Borrowing.  If such
     Lender does not pay such amount forthwith upon the  Administrative  Agent's
     demand therefor,  the Administrative  Agent may make a demand therefor upon
     the Borrower,  and the Borrower shall pay such amount to the Administrative
     Agent, together with interest thereon for the Compensation Period at a rate
     per  annum  equal  to the rate of  interest  applicable  to the  applicable
     Borrowing.  Nothing  herein  shall be deemed to relieve any Lender from its
     obligation  to fulfill its  Commitment  or to prejudice any rights that the
     Administrative  Agent or the  Borrower  may have  against  any  Lender as a
     result of any default by such Lender hereunder.

     A notice of the  Administrative  Agent to any Lender or the  Borrower  with
     respect to any amount owing under this  subsection (c) shall be conclusive,
     absent manifest error.

     (e) If any Lender makes available to the Administrative Agent funds for any
     Loan to be made by such Lender as provided in the  foregoing  provisions of
     this  Article II, and such funds are not made  available to the Borrower by
     the  Administrative  Agent because the conditions to the applicable  Credit
     Extension  set forth in Article V are not satisfied or waived in accordance
     with the terms hereof, the Administrative  Agent shall promptly return such
     funds (in like funds as received from such Lender) to such Lender,  without
     interest.

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     (f) The obligations of the Lenders hereunder to make Committed Loans and to
     fund  participations  in Letters of Credit and Swing Line Loans are several
     and not joint.  The failure of any Lender to make any Committed  Loan or to
     fund any  such  participation  on any date  required  hereunder  shall  not
     relieve any other Lender of its  corresponding  obligation to do so on such
     date,  and no Lender  shall be  responsible  for the  failure  of any other
     Lender to so make its Committed Loan or purchase its participation.

     (g) Nothing  herein  shall be deemed to  obligate  any Lender to obtain the
     funds for any Loan in any  particular  place or manner or to  constitute  a
     representation  by any Lender that it has obtained or will obtain the funds
     for any Loan in any particular place or manner.

     2.13 Sharing of Payments.

     If, other than as expressly  provided  elsewhere  herein,  any Lender shall
     obtain on account of the Committed Loans made by it, or the  participations
     in L/C Obligations or in Swing Line Loans held by it (but not including any
     amounts applied by the Swing Line Lender to outstanding  Swing Line Loans),
     any payment (whether  voluntary,  involuntary,  through the exercise of any
     right of set-off,  or  otherwise)  in excess of its ratable share (or other
     share contemplated  hereunder)  thereof,  such Lender shall immediately (a)
     notify the  Administrative  Agent of such fact,  and (b) purchase  from the
     other  Lenders  such  participations  in the  Committed  Loans made by them
     and/or such  subparticipations  in the participations in L/C Obligations or
     Swing Line Loans held by them, as the case may be, as shall be necessary to
     cause such purchasing Lender to share the excess payment in respect of such
     Committed Loans or such  participations,  as the case may be, pro rata with
     each of them; provided,  however, that if all or any portion of such excess
     payment is thereafter recovered from the purchasing Lender under any of the
     circumstances  described  in  Section  11.06  (including  pursuant  to  any
     settlement  entered into by the purchasing Lender in its discretion),  such
     purchase  shall to that extent be  rescinded  and each other  Lender  shall
     repay to the purchasing  Lender the purchase price paid therefor,  together
     with an amount equal to such paying  Lender's  ratable share  (according to
     the proportion of (i) the amount of such paying Lender's required repayment
     to (ii) the total amount so recovered  from the  purchasing  Lender) of any
     interest  or other  amount  paid or  payable  by the  purchasing  Lender in
     respect of the total amount so recovered, without further interest thereon.
     The  Borrower  agrees that any Lender so  purchasing a  participation  from
     another  Lender may, to the fullest extent  permitted by law,  exercise all
     its rights of  payment  (including  the right of  set-off,  but  subject to
     Section  11.09)  with  respect  to such  participation  as fully as if such
     Lender  were the  direct  creditor  of the  Borrower  in the amount of such
     participation.  The Administrative  Agent will keep records (which shall be
     conclusive and binding in the absence of manifest error) of  participations
     purchased  under this  Section  and will in each case  notify  the  Lenders
     following any such  purchases or  repayments.  Each Lender that purchases a
     participation  pursuant to this Section  shall from and after such purchase
     have the right to give all notices, requests, demands, directions and other
     communications  under this  Agreement  with  respect to the  portion of the

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     Obligations  purchased to the same extent as though the  purchasing  Lender
     were the original owner of the Obligations purchased.


                                  Article III.

                     TAXES, YIELD PROTECTION AND ILLEGALITY

     3.01 Taxes.

     (a) Except as otherwise  expressly provided herein, any and all payments by
     the  Borrower  to or for the  account  of the  Administrative  Agent or any
     Lender under any Loan Document  shall be made free and clear of and without
     deduction for any and all present or future taxes, duties, levies, imposts,
     deductions,  assessments,  fees,  withholdings or similar charges,  and all
     liabilities  with  respect  thereto,  excluding  (i)  in  the  case  of the
     Administrative  Agent and each Lender, any and all present and future taxes
     imposed on or measured by its income or gross receipts, and franchise taxes
     imposed on it, by a jurisdiction (the "Taxing Jurisdiction") as a result of
     (A) the  Administrative  Agent or such  Lender,  as the case may be,  being
     organized  under the Laws of or  maintaining a lending office in the Taxing
     Jurisdiction or (B) the  Administrative  Agent or such Lender,  as the case
     may be, booking Loans made by it in the Taxing Jurisdiction and (ii) in the
     case of a Foreign Lender, any taxes, duties, levies,  imposts,  deductions,
     assessments,  fees,  withholdings or similar  charges,  and all liabilities
     with respect  thereto,  that are imposed on amounts payable to such Foreign
     Lender at the time such Foreign  Lender  becomes a party to this  Agreement
     (or designates a new lending  office) or are  attributable  to such Foreign
     Lender's  failure or  inability  (other than as a result of a change in any
     applicable law, treaty or governmental rule, regulation or order) to comply
     with Section  11.15,  except to the extent that such Foreign Lender (or its
     assignor, if any) was entitled, at the time of designation of a new lending
     office (or  assignment),  to receive  additional  amounts from the Borrower
     with  respect  to  such  taxes,  duties,   levies,   imposts,   deductions,
     assessments,  fees,  withholdings or similar  charges,  and all liabilities
     with respect thereto,  pursuant to this Section 3.01 (all such non-excluded
     taxes, duties, levies, imposts, deductions, assessments, fees, withholdings
     or similar charges,  and liabilities with respect thereto being hereinafter
     referred  to as  "Taxes"  and all  such  excluded  taxes,  duties,  levies,
     imposts,  deductions,  assessments,  fees, withholdings or similar charges,
     and  liabilities  with respect  thereto  being  hereinafter  referred to as
     "Excluded Taxes").  If the Borrower shall be required by any Laws to deduct
     any Taxes from or in respect of any sum payable  under any Loan Document to
     the  Administrative  Agent  or any  Lender,  (i) the sum  payable  shall be
     increased  as  necessary  so that  after  making  all  required  deductions
     (including  deductions  applicable  to  additional  sums payable under this
     Section),  the Administrative Agent or such Lender receives an amount equal
     to the sum it would have received had no such  deductions  been made,  (ii)
     the Borrower shall make such  deductions,  (iii) the Borrower shall pay the
     full amount deducted to the relevant taxation  authority or other authority
     in accordance with  applicable  Laws, and (iv) within thirty days after the
     date of such  payment,  the Borrower  shall  furnish to the  Administrative

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     Agent  (which  shall  forward the same to such  Lender)  the  original or a
     certified copy of a receipt evidencing payment thereof.

     (b) In addition,  the Borrower  agrees to pay any and all present or future
     stamp or  documentary  taxes and any  other  excise  or  property  taxes or
     charges  or  similar  levies  that  arise  from  the  execution,  delivery,
     performance   (other  than  payment  of  amounts  owing  under  the  Credit
     Documents),  enforcement or  registration  of, or otherwise  similarly with
     respect to, any Loan Document (hereinafter referred to as "Other Taxes").

     (c) The Borrower  agrees to  indemnify  the  Administrative  Agent and each
     Lender  for (i) the full  amount of Taxes and Other  Taxes  (including  any
     Taxes or Other Taxes  imposed or asserted  by any  jurisdiction  on amounts
     payable  under  this  Section)  paid by the  Administrative  Agent and such
     Lender  and (ii) any  liability  (including  additions  to tax,  penalties,
     interest and expenses) arising  therefrom or with respect thereto,  in each
     case  whether or not such Taxes or Other  Taxes were  correctly  or legally
     imposed or  asserted  by the  relevant  Governmental  Authority;  provided,
     however,  that the Borrower  shall not have any obligation to indemnify any
     party  hereunder for Taxes,  Other Taxes or any other liability that arises
     from such party's own gross negligence or willful misconduct. Payment under
     this  subsection  (d) shall be made  within  sixty  days after the date the
     Lender  or the  Administrative  Agent  makes  a  written  demand  therefor;
     provided, however, that notwithstanding any other provision of this Section
     3.01, if the Administrative Agent or any Lender requests indemnification or
     compensation  for Taxes or Other Taxes  pursuant to this  Section 3.01 more
     than 120 days after the earlier of (i) the date on which the Administrative
     Agent or such Lender,  as the case may be,  makes  payment of such Taxes or
     Other  Taxes,  and  (ii) the date on  which  the  appropriate  Governmental
     Authority makes written demand on the Administrative  Agent or such Lender,
     as the case may be,  for  payment of such  Taxes or Other  Taxes,  then the
     Borrower   shall  not  be  obligated   to   indemnify   or  reimburse   the
     Administrative  Agent or such Lender, as the case may be, for such Taxes or
     Other Taxes.

     (d) Treatment of Certain Refunds. If the Administrative  Agent, a Lender or
     the Issuing Bank determines,  in good faith,  that it has received a refund
     of any  Taxes or Other  Taxes  as to which it has been  indemnified  by the
     Borrower or with respect to which the Borrower has paid additional  amounts
     pursuant to this Section  3.01, it shall pay an amount equal to such refund
     to the Borrower  (but only to the extent of  indemnity  payments  made,  or
     additional  amounts  paid,  by the  Borrower  under this  Section 3.01 with
     respect to the Taxes or Other Taxes giving rise to such refund), net of all
     out-of-pocket  expenses  of the  Administrative  Agent,  such Lender or the
     Issuing  Bank and without  interest  (other than any  interest  paid by the
     relevant Governmental Authority with respect to such refund); provided that
     the Borrower,  upon the request of the Administrative Agent, such Lender or
     the  Issuing  Bank,  agrees to repay the amount  paid over to the  Borrower
     (plus any  penalties,  interest or other  charges  imposed by the  relevant
     Governmental  Authority) to the  Administrative  Agent,  such Lender or the
     Issuing  Bank in the event the  Administrative  Agent,  such  Lender or the
     Issuing  Bank is  required  to  repay  such  refund  to  such  Governmental
     Authority.   This   paragraph   shall  not  be  construed  to  require  the
     Administrative  Agent, any Lender or the Issuing Bank to

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     make  available its tax returns (or any other  information  relating to its
     taxes that it deems confidential) to the Borrower or any other Person.

     3.02 Illegality.

     If any Lender  determines  that any Law has made it  unlawful,  or that any
     Governmental  Authority has asserted that it is unlawful, for any Lender or
     its applicable  Lending Office to make,  maintain or fund Eurocurrency Rate
     Loans in the Applicable Currency,  or to determine or charge interest rates
     based upon the Adjusted  Eurocurrency  Rate, or any Governmental  Authority
     has  imposed  material  restrictions  on the  authority  of such  Lender to
     purchase or sell,  or to take deposits of, any  Applicable  Currency in the
     applicable  interbank market, then, on notice thereof by such Lender to the
     Borrower through the Administrative Agent, any obligation of such Lender to
     make or continue  Eurocurrency Rate Loans in the Applicable  Currency or to
     convert  Base  Rate  Loans to  Eurocurrency  Rate  Loans in the  Applicable
     Currency shall be suspended until such Lender  notifies the  Administrative
     Agent  and  the  Borrower  that  the  circumstances  giving  rise  to  such
     determination  no longer exist.  Upon receipt of such notice,  the Borrower
     shall,  upon  demand from such  Lender  (with a copy to the  Administrative
     Agent),  prepay  or, if  applicable  and such  Eurocurrency  Rate Loans are
     denominated in Dollars,  convert all Eurocurrency Rate Loans of such Lender
     to Base Rate Loans, either on the last day of the Interest Period therefor,
     if such Lender may lawfully  continue to maintain  such  Eurocurrency  Rate
     Loans to such day, or immediately, if such Lender may not lawfully continue
     to maintain  such  Eurocurrency  Rate Loans.  Upon any such  prepayment  or
     conversion,  the Borrower shall also pay accrued  interest on the amount so
     prepaid or converted.  Each Lender agrees to designate a different  Lending
     Office if such  designation  will  avoid the need for such  notice and will
     not, in the good faith  judgment of such Lender,  otherwise  be  materially
     disadvantageous  to such  Lender.  If such  Lender  does  not  designate  a
     different  Lending  Office to avoid the need for such notice,  the Borrower
     may replace such Lender in accordance with Section 11.16.

     3.03 Inability to Determine Rates.

     (a) If the  Administrative  Agent determines in connection with any request
     for a  Eurocurrency  Rate Loan or a conversion to or  continuation  thereof
     that (i) deposits in the Applicable Currency are not being offered to banks
     in the  applicable  offshore  interbank  market for such  currency  for the
     applicable  amount and Interest Period of such Eurocurrency Rate Loan, (ii)
     adequate and reasonable means do not exist for determining the Eurocurrency
     Rate for such  Eurocurrency  Rate Loan, or (iii) the Eurocurrency  Rate for
     such Eurocurrency Rate Loan does not adequately and fairly reflect the cost
     to the Lenders of funding such Eurocurrency  Rate Loan, the  Administrative
     Agent will promptly  notify the Borrower and all Lenders.  Thereafter,  the
     obligation  of the Lenders to make or maintain  Eurocurrency  Rate Loans in
     the Applicable  Currency shall be suspended until the Administrative  Agent
     revokes such notice.  Upon receipt of such notice,  the Borrower may revoke
     any  pending  request  for  a  Borrowing,  conversion  or  continuation  of
     Eurocurrency  Rate Loans or, failing that, will

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     be deemed to have  converted  such  request  into a request for a Committed
     Borrowing of Base Rate Loans in the amount specified therein.

     (b) If any Mandatory Cost Reference  Lender's  Commitment  shall  terminate
     (otherwise  than on termination of the Aggregate  Commitments),  or for any
     reason  whatsoever any Mandatory Cost Reference  Lender shall cease to be a
     Lender  hereunder,  such Mandatory Cost  Reference  Lender shall  thereupon
     cease to be a Mandatory Cost Reference  Lender,  and, when  necessary,  the
     Mandatory  Cost  Rate  shall be  determined  on the  basis of the  rates as
     notified by the remaining  Mandatory Cost  Reference  Lenders in accordance
     with Schedule 1.01.

     3.04 Increased Cost and Reduced Return; Capital Adequacy.

     (a) If any Lender determines that as a result of the introduction of or any
     change in or in the interpretation of any Law following the date hereof, or
     such Lender's compliance therewith, there shall be any increase in the cost
     to such  Lender of  agreeing  to make or  making,  funding  or  maintaining
     Eurocurrency Rate Loans or (as the case may be) issuing or participating in
     Letters of Credit,  or a reduction in the amount  received or receivable by
     such Lender in connection with any of the foregoing (excluding for purposes
     of this  subsection  (a) any such  increased  costs or  reduction in amount
     resulting  from (i)  Taxes,  Other  Taxes and  Excluded  Taxes (as to which
     Section  3.01  shall  govern),  (ii)  changes in the basis of  taxation  of
     overall  net income or  overall  gross  income by the United  States or any
     foreign  jurisdiction or any political  subdivision of either thereof under
     the Laws of which such Lender is organized or has its Lending  Office,  and
     (iii) reserve requirements  utilized, as to Eurocurrency Rate Loans, in the
     determination of the Adjusted  Eurocurrency  Rate),  then from time to time
     upon  demand  of  such   Lender   (with  a  copy  of  such  demand  to  the
     Administrative   Agent),  the  Borrower  shall  pay  to  such  Lender  such
     additional  amounts as will  compensate such Lender for such increased cost
     or reduction.

     (b) If any Lender  determines  that the  introduction  of any Law regarding
     capital  adequacy or any change  therein or in the  interpretation  thereof
     following  the date hereof,  or  compliance  by such Lender (or its Lending
     Office)  therewith,  has the effect of  reducing  the rate of return on the
     capital of such  Lender or any  corporation  controlling  such  Lender as a
     consequence   of  such   Lender's   obligations   hereunder   (taking  into
     consideration  its  policies  with  respect  to capital  adequacy  and such
     Lender's desired return on capital),  then from time to time upon demand of
     such Lender (with a copy of such demand to the  Administrative  Agent), the
     Borrower  shall  pay  to  such  Lender  such  additional  amounts  as  will
     compensate such Lender for such  reduction;  provided that each such Lender
     shall make  demand for  compensation  hereunder  no later than  ninety days
     after becoming aware of such effect.

     (c)  Notwithstanding  anything to the  contrary in this Section  3.04,  the
     Borrower  shall not be  required  to pay to any Lender  additional  amounts
     under this Section 3.04 for Taxes,  Other Taxes and Excluded Taxes (Section
     3.01 shall govern the obligation of the Borrower to pay additional  amounts
     for Taxes, Other Taxes and Excluded Taxes).

                                       56
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     3.05 Funding Losses.

     Upon demand of any Lender  (with a copy to the  Administrative  Agent) from
     time to time, the Borrower shall  promptly  compensate  such Lender for and
     hold such Lender harmless from any loss, cost or expense  incurred by it as
     a result of:

     (a) any continuation,  conversion,  payment or prepayment of any Loan other
     than a Base  Rate  Loan on a day  other  than the last day of the  Interest
     Period for such Loan (whether voluntary, mandatory, automatic, by reason of
     acceleration, or otherwise);

     (b) any  failure by the  Borrower  (for a reason  other than the failure of
     such Lender to make a Loan) to prepay, borrow, continue or convert any Loan
     other  than a Base Rate Loan on the date or in the amount  notified  by the
     Borrower;

     (c) any  failure  by the  Borrower  to make  payment of any Loan or drawing
     under any Letter of Credit (or  interest  due  thereon)  denominated  in an
     Alternative  Currency on its scheduled due date or any payment thereof in a
     different currency; or

     (d) any assignment of a Eurocurrency Rate Loan on a day other than the last
     day of the  Interest  Period  therefor  as a  result  of a  request  by the
     Borrower pursuant to Section 11.16;

     including any foreign  exchange losses and any loss or expense arising from
     the  liquidation or  reemployment  of funds obtained by it to maintain such
     Loan or from fees payable to terminate  the deposits  from which such funds
     were  obtained.  The  Borrower  shall  also  pay any  reasonable  customary
     administrative   fees  charged  by  such  Lender  in  connection  with  the
     foregoing.

     For purposes of calculating  amounts payable by the Borrower to the Lenders
     under this  Section  3.05,  each Lender shall be deemed to have funded each
     Eurocurrency  Rate  Loan  made  by it at  the  Eurocurrency  Rate  used  in
     determining  the  Adjusted  Eurocurrency  Rate for such Loan by a  matching
     deposit or other borrowing in the applicable  offshore interbank market for
     such currency for a comparable amount and for a comparable period,  whether
     or not such Eurocurrency Rate Loan was in fact so funded.

     3.06 Matters Applicable to all Requests for Compensation.

     (a) A  certificate  of the  Administrative  Agent  or any  Lender  claiming
     compensation under this Article III and setting forth the additional amount
     or amounts to be paid to it hereunder shall be conclusive in the absence of
     manifest error. In determining  such amount,  the  Administrative  Agent or
     such Lender may use any reasonable averaging and attribution methods.

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     (b) Upon any Lender's making a claim for compensation under Section 3.01 or
     3.04,  the  Borrower  may replace  such Lender in  accordance  with Section
     11.16.

     3.07 Survival.

     All of the  Borrower's  obligations  under this  Article III shall  survive
     termination  of the  Aggregate  Commitments  and  repayment  of  all  other
     Obligations hereunder.

                                  Article IV.

                                    GUARANTY

     4.01 The Guaranty.

     Each of the  Guarantors  hereby  jointly and  severally  guarantees to each
     Lender,  each Affiliate of a Lender that enters into a Swap  Contract,  and
     the Administrative  Agent as hereinafter  provided,  as primary obligor and
     not as surety,  the  prompt  payment  of the  Obligations  in full when due
     (whether at stated maturity, as a mandatory prepayment, by acceleration, as
     a mandatory  cash  collateralization  or otherwise)  strictly in accordance
     with the terms thereof.  The Guarantors hereby further agree that if any of
     the Obligations are not paid in full when due (whether at stated  maturity,
     as  a  mandatory   prepayment,   by  acceleration,   as  a  mandatory  cash
     collateralization   or  otherwise),   the  Guarantors  will,   jointly  and
     severally,  promptly pay the same, without any demand or notice whatsoever,
     and that in the case of any  extension of time of payment or renewal of any
     of the  Obligations,  the  same  will be  promptly  paid in full  when  due
     (whether at extended maturity, as a mandatory prepayment,  by acceleration,
     as a mandatory cash  collateralization or otherwise) in accordance with the
     terms of such extension or renewal.

     Notwithstanding  any provision to the contrary  contained  herein or in any
     other of the Loan  Documents or Swap  Contracts,  the  obligations  of each
     Guarantor  under  this  Agreement  and the other  Loan  Documents  shall be
     limited to an aggregate  amount equal to the largest  amount that would not
     render such  obligations  subject to avoidance under the Debtor Relief Laws
     or any comparable provisions of any applicable state law.

     4.02 Obligations Unconditional.

     The obligations of the Guarantors under Section 4.01 are joint and several,
     absolute  and  unconditional,   irrespective  of  the  value,  genuineness,
     validity, regularity or enforceability of any of the Loan Documents or Swap
     Contracts, or any other agreement or instrument referred to therein, or any
     substitution,  release, impairment or exchange of any other guarantee of or
     security for any of the  Obligations,  and, to the fullest extent permitted
     by applicable law,  irrespective of any other circumstance  whatsoever that
     might otherwise  constitute a legal or equitable  discharge or defense of a
     surety or  guarantor,  it being the  intent of this  Section  4.02 that the
     obligations of the Guarantors hereunder shall be absolute and unconditional
     under any and all circumstances.  Each Guarantor agrees that

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     such Guarantor shall have no right of subrogation, indemnity, reimbursement
     or  contribution  against the Borrower or any other  Guarantor  for amounts
     paid under this  Article  IV until such time as the  Obligations  have been
     paid in  full  and the  Commitment  have  expired  or  terminated.  Without
     limiting the generality of the foregoing, it is agreed that, to the fullest
     extent permitted by law, the occurrence of any one or more of the following
     shall not alter or impair the liability of any Guarantor  hereunder,  which
     shall remain absolute and unconditional as described above:

     (a) at any time or from time to time, without notice to any Guarantor,  the
     time for any performance of or compliance with any of the Obligations shall
     be extended, or such performance or compliance shall be waived;

     (b) any of the acts  mentioned in any of the  provisions of any of the Loan
     Documents,  any Swap Contract between any Loan Party and any Lender, or any
     Affiliate of a Lender, or any other agreement or instrument  referred to in
     the Loan Documents or such Swap Contracts shall be done or omitted;

     (c) the maturity of any of the Obligations shall be accelerated,  or any of
     the Obligations shall be modified,  supplemented or amended in any respect,
     or any right under any of the Loan Documents, any Swap Contract between any
     Loan  Party and any  Lender,  or any  Affiliate  of a Lender,  or any other
     agreement  or  instrument  referred to in the Loan  Documents  or such Swap
     Contracts  shall be waived or any other guarantee of any of the Obligations
     or any security therefor shall be released,  impaired or exchanged in whole
     or in part or otherwise dealt with;

     (d) any Lien  granted to, or in favor of, the  Administrative  Agent or any
     Lender or  Lenders as  security  for any of the  Obligations  shall fail to
     attach or be perfected; or

     (e) any of the  Obligations  shall  be  determined  to be void or  voidable
     (including,  without  limitation,  for the  benefit of any  creditor of any
     Guarantor) or shall be subordinated to the claims of any Person (including,
     without limitation, any creditor of any Guarantor).

     With respect to its obligations hereunder,  each Guarantor hereby expressly
     waives diligence,  presentment,  demand of payment, protest and all notices
     whatsoever, and any requirement that the Administrative Agent or any Lender
     exhaust any right,  power or remedy or proceed against any Person under any
     of the Loan  Documents,  any Swap  Contract  between any Loan Party and any
     Lender,  or any Affiliate of a Lender, or any other agreement or instrument
     referred to in the Loan  Documents or such Swap  Contracts,  or against any
     other  Person  under any other  guarantee  of, or security  for, any of the
     Obligations.

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     4.03 Reinstatement.

     The  obligations  of  the  Guarantors   under  this  Article  IV  shall  be
     automatically  reinstated  if and to the  extent  that for any  reason  any
     payment  by or on behalf of any Person in  respect  of the  Obligations  is
     rescinded  or  must  be  otherwise  restored  by any  holder  of any of the
     Obligations,  whether  as a result  of any  proceedings  in  bankruptcy  or
     reorganization  or  otherwise,  and  each  Guarantor  agrees  that  it will
     indemnify  the  Administrative  Agent and each  Lender  on  demand  for all
     reasonable  costs and expenses  (including,  without  limitation,  fees and
     expenses of counsel) incurred by the Administrative Agent or such Lender in
     connection with such  rescission or  restoration,  including any such costs
     and expenses  incurred in defending  against any claim  alleging  that such
     payment  constituted a preference,  fraudulent  transfer or similar payment
     under any bankruptcy, insolvency or similar law.

     4.04 Certain Additional Waivers.

     Each Guarantor  agrees that such Guarantor  shall have no right of recourse
     to security for the  Obligations,  except through the exercise of rights of
     subrogation  pursuant to Section 4.02 and through the exercise of rights of
     contribution pursuant to Section 4.06.

     4.05 Remedies.

     The  Guarantors  agree that,  to the fullest  extent  permitted  by law, as
     between the Guarantors,  on the one hand, and the Administrative  Agent and
     the  Lenders,  on the other  hand,  the  Obligations  may be declared to be
     forthwith  due and payable as provided in Section 9.02 (and shall be deemed
     to have become automatically due and payable in the circumstances  provided
     in said  Section  9.02) for purposes of Section  4.01  notwithstanding  any
     stay,  injunction or other  prohibition  preventing  such  declaration  (or
     preventing the Obligations from becoming  automatically due and payable) as
     against any other Person and that, in the event of such declaration (or the
     Obligations being deemed to have become automatically due and payable), the
     Obligations  (whether  or not due and  payable by any other  Person)  shall
     forthwith  become due and payable by the Guarantors for purposes of Section
     4.01.

     4.06 Rights of Contribution.

     The  Guarantors  hereby agree as among  themselves  that,  if any Guarantor
     shall make an Excess Payment (as defined below),  such Guarantor shall have
     a right of  contribution  from each other  Guarantor  in an amount equal to
     such other Guarantor's Contribution Share (as defined below) of such Excess
     Payment.  The payment  obligations of any Guarantor under this Section 4.06
     shall be  subordinate  and  subject in right of payment to the  Obligations
     until  such  time  as the  Obligations  have  been  paid  in  full  and the
     Commitments  have expired or terminated,  and none of the Guarantors  shall
     exercise  any right or remedy  under this  Section  4.06  against any other
     Guarantor until such Obligations have been paid in full and the Commitments
     have expired or terminated.  For purposes of this Section 4.06, (a) "Excess
     Payment"  shall  mean the  amount  paid by any  Guarantor  in excess of its
     Ratable  Share of any  Guaranteed  Obligations;  (b) "Ratable  Share" shall
     mean, for any Guarantor in respect of any payment of Obligations, the ratio
     (expressed  as a  percentage)  as of the date of such payment of Guaranteed
     Obligations  of (i) the

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     amount by which the  aggregate  present  fair  salable  value of all of its
     assets and  properties  exceeds the amount of all debts and  liabilities of
     such  Guarantor  (including  contingent,   subordinated,   unmatured,   and
     unliquidated  liabilities,  but excluding the obligations of such Guarantor
     hereunder) to (ii) the amount by which the  aggregate  present fair salable
     value of all assets and other properties of all of the Loan Parties exceeds
     the  amount  of all of the  debts and  liabilities  (including  contingent,
     subordinated,  unmatured, and unliquidated  liabilities,  but excluding the
     obligations of the Loan Parties  hereunder) of the Loan Parties;  provided,
     however,  that,  for  purposes of  calculating  the  Ratable  Shares of the
     Guarantors in respect of any payment of  Obligations,  any  Guarantor  that
     became a  Guarantor  subsequent  to the date of any such  payment  shall be
     deemed  to have  been a  Guarantor  on the  date of  such  payment  and the
     financial  information  for such  Guarantor  as of the date such  Guarantor
     became a Guarantor  shall be utilized for such Guarantor in connection with
     such payment;  (c)  "Contribution  Share" shall mean,  for any Guarantor in
     respect  of any  Excess  Payment  made by any  other  Guarantor,  the ratio
     (expressed  as a percentage)  as of the date of such Excess  Payment of (i)
     the amount by which the aggregate  present fair salable value of all of its
     assets and  properties  exceeds the amount of all debts and  liabilities of
     such  Guarantor  (including  contingent,   subordinated,   unmatured,   and
     unliquidated  liabilities,  but excluding the obligations of such Guarantor
     hereunder) to (ii) the amount by which the  aggregate  present fair salable
     value of all assets and other properties of the Loan Parties other than the
     maker of such  Excess  Payment  exceeds  the amount of all of the debts and
     liabilities   (including   contingent,    subordinated,    unmatured,   and
     unliquidated  liabilities,  but  excluding  the  obligations  of  the  Loan
     Parties) of the Loan Parties  other than the maker of such Excess  Payment;
     provided,  however,  that,  for purposes of  calculating  the  Contribution
     Shares of the  Guarantors in respect of any Excess  Payment,  any Guarantor
     that became a Guarantor  subsequent to the date of any such Excess  Payment
     shall be deemed to have been a Guarantor on the date of such Excess Payment
     and the  financial  information  for such  Guarantor  as of the  date  such
     Guarantor  became a  Guarantor  shall be  utilized  for such  Guarantor  in
     connection with such Excess Payment; and (d) "Guaranteed Obligations" shall
     mean the Obligations  guaranteed by the Guarantors pursuant to this Article
     IV.  This  Section  4.06  shall  not be  deemed  to  affect  any  right  of
     subrogation,  indemnity,  reimbursement or contribution  that any Guarantor
     may have under Law  against  the  Borrower  in  respect  of any  payment of
     Guaranteed  Obligations.  Notwithstanding  the  foregoing,  all  rights  of
     contribution  against any  Guarantor  shall  terminate  from and after such
     time, if ever,  that such Guarantor shall be relieved of its obligations in
     accordance with Section 10.11.

     4.07 Guarantee of Payment; Continuing Guarantee.

     The  guarantee  in this  Article  IV is a guaranty  of  payment  and not of
     collection,  is a continuing guarantee,  and shall apply to all Obligations
     whenever arising.

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                                   Article V.

                   CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

     5.01 Conditions of Initial Credit Extension.

     The  obligation  of  each  Lender  to make  its  initial  Credit  Extension
     hereunder is subject to satisfaction of the following conditions precedent:

     (a) The  Administrative  Agent's  receipt of the  following,  each of which
     shall be originals or facsimiles  (followed  promptly by originals)  unless
     otherwise specified, each properly executed by a Responsible Officer of the
     signing  Loan  Party,  each  dated the  Closing  Date  (or,  in the case of
     certificates  of governmental  officials,  a recent date before the Closing
     Date) and each in form and  substance  satisfactory  to the  Administrative
     Agent and its legal counsel:

     (i) executed  counterparts of this Agreement by the  Administrative  Agent,
     each Lender and each Loan Party,  sufficient in number for  distribution to
     the Administrative Agent, each Lender and the Borrower;

     (ii) a Note  executed by the Borrower in favor of each Lender  requesting a
     Note;

     (iii) copies of the Organization  Documents of each Loan Party certified to
     be true and  complete as of a recent date by the  appropriate  Governmental
     Authority  of the  state  or other  jurisdiction  of its  incorporation  or
     organization,  where applicable,  and certified by a secretary or assistant
     secretary of such Loan Party to be true and correct as of the Closing Date;

     (iv)  such   certificates  of  resolutions  or  other  action,   incumbency
     certificates and/or other certificates of Responsible Officers of each Loan
     Party as the  Administrative  Agent may require  evidencing  the  identity,
     authority and capacity of each  Responsible  Officer thereof  authorized to
     act as a  Responsible  Officer in  connection  with this  Agreement and the
     other Loan Documents to which such Loan Party is a party;

     (v) such  documents  and  certifications  as the  Administrative  Agent may
     reasonably  require to evidence  that each Loan Party is duly  organized or
     formed,  and  that  each of the  Borrower  and the  Guarantors  is  validly
     existing, in good standing and qualified to engage in business in its state
     of organization or formation,  the state of its principal place of business
     and each other  jurisdiction  where its  ownership,  lease or  operation of
     properties  or the conduct of its  business  requires  such  qualification,
     except to the extent that failure to do so would not reasonably be expected
     to have a Material Adverse Effect;

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     (vi) a favorable opinion of Hunton & Williams, counsel to the Loan Parties,
     addressed  to the  Administrative  Agent and each  Lender,  dated as of the
     Closing Date,  and in form and  substance  reasonably  satisfactory  to the
     Administrative Agent;

     (vii) a certificate of a Responsible  Officer of each Loan Party either (A)
     attaching  copies of all  consents,  licenses  and  approvals  required  in
     connection with the execution,  delivery and performance by such Loan Party
     and the validity  against such Loan Party of the Loan Documents to which it
     is a party,  and such  consents,  licenses and  approvals  shall be in full
     force  and  effect,  or (B)  stating  that no such  consents,  licenses  or
     approvals are so required;

     (viii) a  certificate  signed  by a  Responsible  Officer  of the  Borrower
     certifying  (A) that the conditions  specified in Sections  5.02(a) and (b)
     have been satisfied, (B) that there has been no event or circumstance since
     the date of the  audited  financial  statements  for the fiscal  year ended
     December  31, 2001 that has had or would be  reasonably  expected to have a
     Material Adverse Effect;  and (C)(1) if rated, the current Debt Ratings and
     (2) if  unrated,  the  Debt to  Capitalization  Ratio  as of the end of the
     fiscal quarter ending June 30, 2002;

     (ix)  evidence  that the  loans and other  obligations  under the  Existing
     Credit Agreement have been repaid (or will be repaid with the initial Loans
     made  hereunder on the Closing Date) and the  commitments  thereunder  have
     been terminated; and

     (x) such other assurances, certificates, documents, consents or opinions as
     the  Administrative  Agent,  the L/C  Issuer,  the Swing Line Lender or the
     Required Lenders reasonably may require.

     (b) Any fees  required to be paid on or before the Closing  Date shall have
     been paid.

     (c) Unless waived by the Administrative Agent, the Borrower shall have paid
     all Attorney Costs of the Administrative Agent to the extent invoiced prior
     to or on the Closing Date, plus such  additional  amounts of Attorney Costs
     as shall  constitute its reasonable  estimate of Attorney Costs incurred or
     to be incurred by it through the closing  proceedings  (provided  that such
     estimate shall not thereafter preclude a final settling of accounts between
     the Borrower and the Administrative Agent).

     5.02 Conditions to all Credit Extensions.

     The  obligation  of each Lender to honor any  Request for Credit  Extension
     (other  than a  Committed  Loan  Notice  requesting  only a  conversion  of
     Committed  Loans to the other

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     Type, or a continuation  of Committed Loans as the same Type) is subject to
     the following conditions precedent:

     (a) The  representations and warranties of the Borrower and each other Loan
     Party  contained  in  Article VI or any other  Loan  Document,  or that are
     contained  in any  document  furnished  at any time under or in  connection
     herewith or  therewith,  shall be true and correct on and as of the date of
     such Credit Extension,  except to the extent that such  representations and
     warranties  specifically refer to an earlier date, in which case they shall
     be true and correct as of such earlier  date,  and except that for purposes
     of this Section  5.02,  the  representations  and  warranties  contained in
     subsections  (a) and (b) of  Section  6.05  shall be deemed to refer to the
     most  recent  statements   furnished  pursuant  to  clauses  (a)  and  (b),
     respectively, of Section 7.01.

     (b) No Default  shall  exist,  or would  result from such  proposed  Credit
     Extension.

     (c) The  Administrative  Agent and,  if  applicable,  the L/C Issuer or the
     Swing Line Lender  shall have  received a Request for Credit  Extension  in
     accordance with the requirements hereof.

     Each  Request for Credit  Extension  (other  than a  Committed  Loan Notice
     requesting  only a  conversion  of  Committed  Loans to the other Type or a
     continuation of Eurocurrency Rate Loans) submitted by the Borrower shall be
     deemed to be a representation and warranty that the conditions specified in
     Sections  5.02(a) and (b) have been  satisfied on and as of the date of the
     applicable Credit Extension.


                                  Article VI.

                         REPRESENTATIONS AND WARRANTIES

     The Loan Parties represent and warrant to the Administrative  Agent and the
     Lenders that:

     6.01 Existence, Qualification and Power; Compliance with Laws.

     Each Loan Party (a) is a  corporation,  partnership  or  limited  liability
     company duly  organized or formed,  validly  existing and in good  standing
     under the Laws of the  jurisdiction of its  incorporation  or organization,
     (b) has all requisite  power and  authority and all requisite  governmental
     licenses, authorizations,  consents and approvals to (i) own its assets and
     carry on its business and (ii) execute, deliver and perform its obligations
     under the Loan Documents to which it is a party,  (c) is duly qualified and
     is licensed and in good standing under the Laws of each jurisdiction  where
     its  ownership,  lease or  operation  of  properties  or the conduct of its
     business requires such  qualification or license,  and (d) is in compliance
     with all Laws;  except in each case

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     referred to in clause (b)(i),  (c) or (d), to the extent that failure to do
     so would not reasonably be expected to have a Material Adverse Effect.

     6.02 Authorization; No Contravention.

     The  execution,  delivery and  performance  by each Loan Party of each Loan
     Document to which such Person is party,  have been duly  authorized  by all
     necessary  corporate  or  other  organizational  action,  and  do  not  (a)
     contravene the terms of any of such Person's  Organization  Documents;  (b)
     conflict with or result in any breach or contravention  of, or the creation
     of any Lien under, (i) any Contractual Obligation to which such Person is a
     party or (ii) any  order,  injunction,  writ or decree of any  Governmental
     Authority  or any  arbitral  award to which such Person or its  property is
     subject; or (c) violate any Law.

     6.03 Governmental Authorization; Other Consents.

     No  approval,  consent,  exemption,  authorization,  or other action by, or
     notice to, or filing with, any  Governmental  Authority or any other Person
     is  necessary or required in  connection  with the  execution,  delivery or
     performance by, or enforcement against, any Loan Party of this Agreement or
     any other Loan Document.

     6.04 Binding Effect.

     This  Agreement  and each other Loan  Document  has been duly  executed and
     delivered by each Loan Party that is party thereto. This Agreement and each
     other Loan Document  constitutes a legal,  valid and binding  obligation of
     each Loan Party that is party thereto,  enforceable  against each such Loan
     Party in accordance with its terms.

     6.05 Financial Statements.

     (a) The audited  consolidated  balance sheet of the Consolidated  Group for
     the fiscal year ended  December  31,  2001,  and the  related  consolidated
     statements of income or operations, shareholders' equity and cash flows for
     such  fiscal  year,  including  the  notes  thereto  (i) were  prepared  in
     accordance  with GAAP  consistently  applied  throughout the period covered
     thereby,  except as otherwise expressly noted therein;  (ii) fairly present
     the financial  condition of the  Consolidated  Group as of the date thereof
     and  their  results  of  operations  for  the  period  covered  thereby  in
     accordance  with GAAP  consistently  applied  throughout the period covered
     thereby,  except as otherwise  expressly noted therein;  and (iii) show all
     material indebtedness and other liabilities,  direct or contingent,  of the
     Consolidated Group as of the date thereof, including liabilities for taxes,
     material commitments and Indebtedness.

     (b) The unaudited  consolidated  financial  statements of the  Consolidated
     Group  for the  fiscal  quarter  ended  June  30,  2002,  and  the  related
     consolidated  statements of income or operations,  shareholders' equity and
     cash flows for such fiscal  quarter

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     (i) were prepared in accordance with GAAP consistently  applied  throughout
     the period covered  thereby,  except as otherwise  expressly noted therein;
     (ii) fairly present the financial condition of the Consolidated Group as of
     the date thereof and their  results of  operations  for the period  covered
     thereby,  subject,  in the case of clauses (i) and (ii),  to the absence of
     footnotes  and to normal  year-end  audit  adjustments;  and (iii) show all
     material indebtedness and other liabilities,  direct or contingent,  of the
     Consolidated Group as of the date thereof, including liabilities for taxes,
     material commitments and Indebtedness.

     6.06 Litigation.

     There are not any actions,  suits or  proceedings at law or in equity or by
     or before any governmental  instrumentality or other agency now pending or,
     to the knowledge of the Loan Parties,  threatened (and reasonably likely to
     be commenced)  against or affecting any member of the Consolidated Group or
     any  property  or rights of the  Consolidated  Group as to which there is a
     reasonable  likelihood of an adverse  determination and which, if adversely
     determined,  would  individually or in the aggregate  materially impair the
     right of the  Consolidated  Group  taken  as a whole  to carry on  business
     substantially  as now being conducted or would result in a Material Adverse
     Effect.

     6.07 No Default.

     (a) Neither the Borrower  nor any  Subsidiary  is in default  under or with
     respect to any Contractual  Obligation that would reasonably be expected to
     have a Material Adverse Effect.

     (b) No Default or Event of Default has occurred and is  continuing or would
     result  from the  consummation  of the  transactions  contemplated  by this
     Agreement or any other Loan Document.

     6.08 Ownership of Property; Liens.

     Each member of the Consolidated  Group has good record and marketable title
     in fee  simple  to, or valid  leasehold  interests  in,  all real  property
     necessary or used in the ordinary conduct of its business,  except for such
     defects in title as would not, individually or in the aggregate, reasonably
     be  expected  to  have a  Material  Adverse  Effect.  The  property  of the
     Consolidated  Group is subject to no Liens,  other than Liens  permitted by
     Section 8.01.

     6.09 Environmental Compliance.

     Except as set forth in  Schedule  6.09:  (a) the  Consolidated  Group is in
     compliance  in all material  respects  with all federal,  state,  local and
     other  statutes,  ordinances,  orders,  judgments,  rulings and regulations
     relating to  environmental  pollution  or to  environmental  regulation  or
     control or to employee health or safety,  except where the

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     failure to do so would not be  reasonably  likely,  individually  or in the
     aggregate,  to result in a Material  Adverse  Effect;  (b) no member of the
     Consolidated  Group has  received  notice  of any  material  failure  so to
     comply,  which  non-compliance  neither  has  been  remedied  nor is  being
     contested  in  good  faith  by  the  Borrower  nor is  the  subject  of the
     Borrower's good faith efforts to achieve  compliance;  (c) the Consolidated
     Group's   facilities  do  not  manage  any  hazardous   wastes,   hazardous
     substances,  hazardous  materials,  toxic  substances,  toxic pollutants or
     substances similarly denominated,  as those terms or similar terms are used
     in  the  Resource   Conservation   and  Recovery  Act,  the   Comprehensive
     Environmental  Response  Compensation  and Liability Act, as amended by the
     Superfund  Amendment  and  Reauthorization  Act,  the  Hazardous  Materials
     Transportation  Act, the Toxic Substance Control Act, the Clean Air Act, as
     amended, the Clean Water Act, the Occupational Health and Safety Act or any
     other applicable law relating to environmental pollution or employee health
     and  safety,  in  violation  in any  material  respect  of  any  law or any
     regulations promulgated pursuant thereto, except where the failure to do so
     would not  reasonably be expected,  individually  or in the  aggregate,  to
     result in a Material  Adverse  Effect;  and (d) the Borrower is aware of no
     events,  conditions or circumstances  involving  environmental pollution or
     contamination or employee health or safety that would be reasonably  likely
     to result in a Material Adverse Effect.

     6.10 Insurance.

     The properties of the Consolidated Group are insured with financially sound
     and reputable insurance  companies not Affiliates of the Borrower,  in such
     amounts  (after giving  effect to any  self-insurance  compatible  with the
     following standards),  with such deductibles and covering such risks as are
     customarily  carried by companies engaged in similar  businesses and owning
     similar  properties  in localities  where the Borrower or its  Subsidiaries
     operate.

     6.11 Taxes.

     Each  member of the  Consolidated  Group has filed all  federal,  state and
     other material tax returns and reports  required to be filed, and have paid
     all federal,  state and other material taxes,  assessments,  fees and other
     governmental  charges  levied or  imposed  upon  them or their  properties,
     income or assets  otherwise  due and  payable,  except those that are being
     contested in good faith by appropriate  proceedings  and for which adequate
     reserves have been provided in accordance  with GAAP.  There is no proposed
     tax assessment  against the Borrower or any Subsidiary that would, if made,
     have a Material Adverse Effect.

     6.12 ERISA Compliance.

     (a) Each Plan is in compliance in all material respects with the applicable
     provisions of ERISA,  the Internal  Revenue Code and other federal or state
     Laws.  Each Plan that is intended to qualify  under  Section  401(a) of the
     Internal  Revenue Code has received a favorable  determination  letter from
     the IRS or an application for such a letter is

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     currently  being  processed  by the IRS with  respect  thereto  and, to the
     knowledge of the  Borrower,  nothing has occurred  that would  prevent,  or
     cause  the  loss of,  such  qualification.  The  Borrower  and  each  ERISA
     Affiliate  have made all  required  contributions  to each Plan  subject to
     Section 412 of the Internal  Revenue Code, and no application for a funding
     waiver or an extension of any  amortization  period pursuant to Section 412
     of the Internal Revenue Code has been made with respect to any Plan.

     (b)  There  are no  pending  or,  to the best  knowledge  of the  Borrower,
     threatened  claims,  actions  or  lawsuits,  or action by any  Governmental
     Authority,  with respect to any Plan that would  reasonably  be expected to
     have a Material Adverse Effect. There has been no prohibited transaction or
     violation of the  fiduciary  responsibility  rules with respect to any Plan
     that has resulted or would  reasonably  be expected to result in a Material
     Adverse Effect.

     (c) Other than as would not  reasonably  be expected to result in liability
     in excess of $10,000,000,  (i) no ERISA Event has occurred or is reasonably
     expected to occur,  (ii) neither the Borrower nor any ERISA  Affiliate  has
     incurred,  or reasonably  expects to incur, any liability under Title IV of
     ERISA with  respect to any Pension  Plan (other than  premiums  due and not
     delinquent under Section 4007 of ERISA and other  contributions  payable in
     accordance  with the terms of such Pension  Plan or  applicable  law),  and
     (iii)  neither  the  Borrower  nor any ERISA  Affiliate  has  incurred,  or
     reasonably expects to incur, any liability (and no event has occurred that,
     with the giving of notice under Section 4219 of ERISA, would result in such
     liability)  under  Sections  4201  or  4243  of  ERISA  with  respect  to a
     Multiemployer Plan.

     (d) No Pension Plan,  individually,  has any Unfunded Pension  Liability in
     excess of $10,000,000,  and the Pension Plans, on a consolidated  basis, do
     not have any Unfunded Pension Liability.

     (e)  Neither  the  Borrower  nor  any  ERISA  Affiliate  has  engaged  in a
     transaction that is subject to Sections 4069 or 4212(c) of ERISA.


     6.13 Margin  Regulations;  Investment  Company Act;  Public Utility Holding
     Company Act.

     (a) The Borrower is not engaged and will not engage,  principally or as one
     of its  important  activities,  in the business of  purchasing  or carrying
     "margin  stock" within the meaning of Regulation U issued by the FRB, as in
     effect from time to time, or extending credit for the purpose of purchasing
     or carrying "margin stock," and the Credit Extensions hereunder will not be
     used to purchase or carry "margin stock" in violation of Regulation U or to
     extend credit to others for the purpose of  purchasing or carrying  "margin
     stock," or for any purpose that would violate or be  inconsistent  with the
     provisions  of  Regulation  X issued by the FRB,  as in effect from time to
     time.

     (b) None of the  Borrower,  any Person  Controlling  the  Borrower,  or any
     Subsidiary  (i) is a "holding  company,"  or a  "subsidiary  company"  of a
     "holding  company,"  or  an

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     "affiliate"  of a  "holding  company"  or of a  "subsidiary  company"  of a
     "holding company," within the meaning of the Public Utility Holding Company
     Act of 1935, or (ii) is or is required to be  registered as an  "investment
     company" under the Investment Company Act of 1940.

     6.14 Disclosure.

     The Borrower has disclosed to the Administrative  Agent and the Lenders all
     agreements,  instruments and corporate or other restrictions to which it or
     any of its  Subsidiaries  is subject,  and all other  matters  known to it,
     that,  individually  or in the aggregate,  would  reasonably be expected to
     result in a  Material  Adverse  Effect.  No  report,  financial  statement,
     certificate or other information  furnished  (whether in writing or orally)
     by or on behalf of any Loan Party to the Administrative Agent or any Lender
     in connection with the transactions contemplated hereby and the negotiation
     of this Agreement or delivered  hereunder (as modified or  supplemented  by
     other information so furnished) contains any material  misstatement of fact
     or  omits to state  any  material  fact  necessary  to make the  statements
     therein,  in the light of the circumstances under which they were made, not
     misleading; provided that, with respect to projected financial information,
     the Borrower  represents  only that such  information  was prepared in good
     faith based upon assumptions believed to be reasonable at the time.

     6.15 Compliance with Laws.

     Each of the Borrower and each  Subsidiary  is in compliance in all material
     respects  with  the  requirements  of  all  Laws  and  all  orders,  writs,
     injunctions and decrees  applicable to it or to its  properties,  except in
     such  instances  in  which  (a) such  requirement  of Law or  order,  writ,
     injunction  or  decree  is being  contested  in good  faith by  appropriate
     proceedings or (b) the failure to comply  therewith would not reasonably be
     expected to have a Material Adverse Effect.

     6.16 Intellectual Property; Licenses, Etc.

     To the  knowledge of the Loan  Parties,  the  Consolidated  Group owns,  or
     possess  the right to use,  all of the  trademarks,  service  marks,  trade
     names, copyrights,  patents, patent rights, franchises,  licenses and other
     intellectual   property  rights   (collectively,   "IP  Rights")  that  are
     reasonably  necessary  for the  operation of their  respective  businesses,
     without  conflict with the rights of any other Person.  To the knowledge of
     the Loan Parties, no slogan or other advertising device, product,  process,
     method, substance, part or other material now employed, or now contemplated
     to be employed, by the Borrower or any Subsidiary infringes upon any rights
     held by any  other  Person.  No claim or  litigation  regarding  any of the
     foregoing is pending or, to the knowledge of the Loan Parties,  threatened,
     that would reasonably be expected to have a Material Adverse Effect.

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                                  Article VII.

                             AFFIRMATIVE COVENANTS

     So long as any Lender  shall  have any  Commitment  hereunder,  any Loan or
     other  Obligation  hereunder  shall remain  unpaid or  unsatisfied,  or any
     Letter of Credit shall remain outstanding, the Loan Parties shall and shall
     cause each of their respective Subsidiaries to:

     7.01 Financial Statements.

     Deliver to the  Administrative  Agent and each  Lender,  in form and detail
     satisfactory to the Administrative Agent and the Required Lenders:

     (a) as soon as available, but in any event within ninety days after the end
     of each fiscal year of the Borrower,  a  consolidated  balance sheet of the
     Consolidated  Group  as of the end of such  fiscal  year,  and the  related
     consolidated  statements of income or operations,  shareholders' equity and
     cash flows for such fiscal year,  setting forth in each case in comparative
     form the figures for the previous fiscal year, all in reasonable detail and
     prepared in accordance  with GAAP,  audited and accompanied by a report and
     opinion  of  an  independent  certified  public  accountant  of  nationally
     recognized  standing reasonably  acceptable to the Required Lenders,  which
     report and opinion shall be prepared in accordance with generally  accepted
     auditing  standards and shall not be subject to any "going concern" or like
     qualification  or  exception  or any  qualification  or exception as to the
     scope of such audit; and

     (b) as soon as available,  but in any event within fifty days after the end
     of each of the first  three  fiscal  quarters  of each  fiscal  year of the
     Borrower,  a consolidated balance sheet of the Consolidated Group as of the
     end of such fiscal  quarter,  and the related  consolidated  statements  of
     income or operations,  shareholders'  equity and cash flows for such fiscal
     quarter  and for the  portion of the  Borrower's  fiscal  year then  ended,
     setting  forth  in each  case  in  comparative  form  the  figures  for the
     corresponding   fiscal  quarter  of  the  previous   fiscal  year  and  the
     corresponding portion of the previous fiscal year, all in reasonable detail
     and certified by a Responsible Officer of the Borrower as fairly presenting
     the financial  condition,  results of operations,  shareholders' equity and
     cash flows of the Consolidated  Group in accordance with GAAP, subject only
     to normal year-end audit adjustments and the absence of footnotes.

     As to any information  contained in materials furnished pursuant to Section
     7.02(d),  the  Borrower  shall not be  separately  required to furnish such
     information  under clause (a) or (b) above,  but the foregoing shall not be
     in derogation of the obligation of the Borrower to furnish the  information
     and  materials  described  in  subsections  (a) and (b)  above at the times
     specified therein.

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     7.02 Certificates; Other Information.

     Deliver to the  Administrative  Agent and each  Lender,  in form and detail
     satisfactory to the Administrative Agent and the Required Lenders:

     (a) concurrently with the delivery of the financial  statements referred to
     in Section  7.01(a),  a certificate  of its  independent  certified  public
     accountants certifying such financial statements and stating that in making
     the examination necessary therefor no knowledge was obtained of any Default
     or Event of Default under the  financial  covenants set forth herein or, if
     any such Default or Event of Default  shall  exist,  stating the nature and
     status of such event;

     (b) concurrently with the delivery of the financial  statements referred to
     in Sections 7.01(a) and (b), a duly completed Compliance Certificate signed
     by a Responsible Officer of the Borrower, (i) setting forth computations in
     reasonable detail  satisfactory to the Administrative  Agent  demonstrating
     (A) compliance with the financial  covenants  contained  herein and (B) the
     amount of  Consolidated  Tangible  Domestic  Assets  and the amount of Loan
     Party Tangible Domestic Assets, (ii) certifying that no Default or Event of
     Default exists as of the date thereof (or, to the extent a Default or Event
     of Default exists,  the nature and extent thereof and the proposed  actions
     of the Loan Parties with respect  thereto) and (iii) including a summary of
     all material changes in GAAP and in the consistent application thereof, the
     effect on the financial covenants resulting therefrom, and a reconciliation
     between  calculation of the financial  covenants (and  determination of the
     applicable  pricing level under the definition of "Applicable  Percentage")
     before and after giving effect to such changes  (which  certificate  may be
     delivered by electronic mail or by facsimile,  with an executed original to
     follow within five Business Days);

     (c) promptly after requested by the  Administrative  Agent on behalf of any
     Lender,  copies  of any  detailed  audit  reports,  management  letters  or
     recommendations submitted to the board of directors (or the audit committee
     of the board of directors) of the Borrower by  independent  accountants  in
     connection with the accounts or books of the Borrower or any Subsidiary, or
     any audit of any of them;

     (d) promptly  after the same are  available,  copies of each annual report,
     proxy or financial  statement or other report or communication  sent to the
     stockholders of the Borrower, and copies of all annual,  regular,  periodic
     and special reports and registration  statements that the Borrower may file
     or be  required  to file  with  the SEC  under  Section  13 or 15(d) of the
     Securities Exchange Act of 1934, and not otherwise required to be delivered
     to the Administrative Agent pursuant hereto; and

     (e) promptly, such additional information regarding the business, financial
     or corporate affairs of the Borrower or any Subsidiary,  or compliance with
     the terms

                                       71
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     of the Loan  Documents,  as the  Administrative  Agent,  on  behalf  of any
     Lender, may from time to time reasonably request.

     Documents  required to be delivered  pursuant to Section  7.01(a) or (b) or
     Section 7.02(d) (to the extent any such documents are included in materials
     otherwise  filed with the SEC) may be  delivered  electronically  and if so
     delivered,  shall be deemed to have been delivered on the date (i) on which
     the  Borrower  posts such  documents,  or  provides  a link  thereto on the
     Borrower's  website  on the  internet  at the  website  address  listed  on
     Schedule  11.02;  or  (ii)  on  which  such  documents  are  posted  on the
     Borrower's behalf on IntraLinks/IntraAgency or another relevant website, if
     any, to which each Lender and the Administrative Agent have access (whether
     a   commercial,   third-party   website   or  whether   sponsored   by  the
     Administrative Agent);  provided that: (i) the Borrower shall deliver paper
     copies of such  documents  to the  Administrative  Agent or any Lender that
     requests the Borrower to deliver such paper copies until a written  request
     to cease  delivering paper copies is given by the  Administrative  Agent or
     such Lender and (ii) the Borrower  shall notify  (which may be by facsimile
     or electronic mail) the Administrative Agent and each Lender of the posting
     of any such documents and provide to the Administrative Agent by electronic
     mail   electronic   versions   (i.e.,   soft  copies)  of  such  documents.
     Notwithstanding  anything  contained herein, in every instance the Borrower
     shall be required to provide  paper copies of the  Compliance  Certificates
     required  by Section  7.02(b) to the  Administrative  Agent and each of the
     Lenders. Except for such Compliance Certificates,  the Administrative Agent
     shall have no obligation  to request the delivery or to maintain  copies of
     the  documents   referred  to  above,  and  in  any  event  shall  have  no
     responsibility to monitor  compliance by the Borrower with any such request
     for delivery,  and each Lender shall be solely  responsible  for requesting
     delivery to it or maintaining its copies of such documents.

     7.03 Notices.

     Promptly notify the Administrative Agent and each Lender:

     (a) of the occurrence of any Default;

     (b) of any matter  that has  resulted  or would  reasonably  be expected to
     result  in  a   Material   Adverse   Effect,   including   (i)   breach  or
     non-performance  of, or any default under, a Contractual  Obligation of the
     Borrower or any Subsidiary;  (ii) any dispute,  litigation,  investigation,
     proceeding or  suspension  between the Borrower or any  Subsidiary  and any
     Governmental  Authority;  or (iii) the  commencement  of,  or any  material
     development in, any litigation or proceeding  affecting the Borrower or any
     Subsidiary, including pursuant to any applicable Environmental Laws;

     (c) of the occurrence of any ERISA Event;

     (d) of any material  change in accounting  policies or financial  reporting
     practices by the Borrower or any Subsidiary;

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     (e) of any litigation, investigation or proceeding affecting any Loan Party
     in which  the  amount  involved  would  reasonably  be  expected  to have a
     Material Adverse Effect, or in which injunctive relief or similar relief is
     sought,  which relief,  if granted,  would reasonably be expected to have a
     Material Adverse Effect; and

     (f) if unrated,  any announcement by Moody's or S&P of any Debt Rating,  or
     if rated,  any  announcement  by Moody's  or S&P of any change or  possible
     change in a Debt Rating.

     Each notice pursuant to this Section shall be accompanied by a statement of
     a  Responsible  Officer  of  the  Borrower  setting  forth  details  of the
     occurrence  referred to therein and stating  what action the  Borrower  has
     taken and proposes to take with respect  thereto.  Each notice  pursuant to
     Section 7.03(a) shall describe with particularity any and all provisions of
     this Agreement and any other Loan Document that have been breached.

     7.04 Payment of Obligations.

     Pay and  discharge  as the  same  shall  become  due and  payable,  all its
     obligations and liabilities, including (a) all tax liabilities, assessments
     and  governmental  charges or levies upon it or its  properties  or assets,
     unless  the  same  are  being   contested  in  good  faith  by  appropriate
     proceedings  and  adequate  reserves  in  accordance  with  GAAP are  being
     maintained by the Borrower or such Subsidiary;  (b) all lawful claims that,
     if  unpaid,  would by law  become a Lien  upon  its  property;  and (c) all
     Indebtedness, as and when due and payable, but subject to any subordination
     provisions  contained  in  any  instrument  or  agreement  evidencing  such
     Indebtedness.

     7.05 Preservation of Existence, Etc.

     (a)  Preserve,  renew  and  maintain  in full  force and  effect  its legal
     existence  and good  standing  under  the Laws of the  jurisdiction  of its
     organization  except in a transaction  permitted by Section 8.03;  (b) take
     all reasonable action to maintain all rights, privileges, permits, licenses
     and  franchises  necessary  or  desirable  in  the  normal  conduct  of its
     business,  except to the extent that failure to do so would not  reasonably
     be expected to have a Material  Adverse  Effect;  and (c) preserve or renew
     all of its registered patents,  trademarks,  trade names and service marks,
     the  non-preservation  of which  would  reasonably  be  expected  to have a
     Material Adverse Effect.

     7.06 Maintenance of Properties.

     (a)  Maintain,  preserve  and protect all of its  material  properties  and
     equipment  necessary in the operation of its business in good working order
     and  condition,  ordinary  wear and tear  excepted;  (b) make all necessary
     repairs  thereto and renewals  and  replacements  thereof  except where the
     failure  to do so would  not  reasonably  be

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     expected to have a Material  Adverse  Effect;  and (c) use the  standard of
     care  typical in the  industry  in the  operation  and  maintenance  of its
     facilities.

     7.07 Maintenance of Insurance.

     Maintain  with  financially  sound and  reputable  insurance  companies not
     Affiliates of the Borrower,  insurance  with respect to its  properties and
     business against loss or damage of the kinds customarily insured against by
     Persons engaged in the same or similar business,  of such types and in such
     amounts  (after giving  effect to any  self-insurance  compatible  with the
     following standards) as are customarily carried under similar circumstances
     by such other Persons.

     7.08 Compliance with Laws.

     Comply in all material  respects with the  requirements of all Laws and all
     orders, writs,  injunctions and decrees applicable to it or to its business
     or property,  except in such instances in which (a) such requirement of Law
     or order,  write,  injunction or decree is being contested in good faith by
     appropriate  proceedings;  or (b) the failure to comply therewith would not
     reasonably be expected to have a Material Adverse Effect.

     7.09 Books and Records.

     (a) Maintain  proper books of record and account,  in which full,  true and
     correct entries in conformity with GAAP consistently  applied shall be made
     of all financial transactions and matters involving the assets and business
     of the  Borrower or such  Subsidiary,  as the case may be; and (b) maintain
     such books of record and account in material conformity with all applicable
     requirements of any Governmental  Authority having regulatory  jurisdiction
     over the Borrower or such Subsidiary, as the case may be.

     7.10 Inspection Rights.

     Upon the  request  of the  Administrative  Agent on behalf  of any  Lender,
     permit  representatives  and independent  contractors of the Administrative
     Agent and each  Lender  to visit  and  inspect  any of its  properties,  to
     examine its  corporate,  financial and operating  records,  and make copies
     thereof or abstracts  therefrom,  and to discuss its affairs,  finances and
     accounts with its directors,  officers, and independent public accountants,
     all at the expense of the  Borrower  and at such  reasonable  times  during
     normal  business  hours  and as often as may be  reasonably  desired,  upon
     reasonable advance notice to the Borrower;  provided, however, that when an
     Event of Default exists the  Administrative  Agent or any Lender (or any of
     their respective  representatives or independent contractors) may do any of
     the  foregoing  at the expense of the  Borrower  at any time during  normal
     business hours and without advance notice.

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     7.11 Use of Proceeds.

     Use  the  proceeds  of the  Credit  Extensions  for (a)  general  corporate
     purposes,   (b)  to  refinance  existing   Indebtedness,   (c)  to  finance
     acquisitions,  (iv) to  repurchase  common stock of the  Borrower,  (v) for
     working  capital and (vi) for  Capital  Expenditures,  provided  that in no
     event shall the proceeds of the Credit  Extensions be used in contravention
     of any Law or of any Loan Document.

     7.12 Joinder of Guarantors.

     Cause Material Domestic  Subsidiaries to be joined as Guarantors hereunder,
     as necessary,  such that Loan Party Tangible Domestic Assets are not at any
     time less than $750,000,000. The Borrower will, in connection with any such
     joinder,  promptly  cause to be  delivered to the  Administrative  Agent an
     executed   Joinder   Agreement,   together  with  supporting   resolutions,
     incumbency certificates,  organizational documents, opinions of counsel and
     such  other   information   as  shall  be   reasonably   requested  by  the
     Administrative  Agent, all in form and substance  reasonably  acceptable to
     the Administrative Agent.

     7.13 ERISA Compliance.

     Do, and cause each of its ERISA  Affiliates  to do, each of the  following:
     (a) maintain  each Plan in  compliance  in all material  respects  with the
     applicable  provisions  of ERISA,  the Code and other federal or state law;
     (b) cause each Plan that is qualified  under Section  401(a) of the Code to
     maintain such qualification; and (c) make all required contributions to any
     Plan subject to Section 412 of the Code.


                                 Article VIII.

                               NEGATIVE COVENANTS

     So long as any Lender  shall  have any  Commitment  hereunder,  any Loan or
     other  Obligation  hereunder  shall remain  unpaid or  unsatisfied,  or any
     Letter of Credit shall remain outstanding, no Loan Party shall nor shall it
     permit any of its Subsidiaries to, directly or indirectly:

     8.01 Liens.

     Create, incur, assume or suffer to exist any Lien upon any of its property,
     assets or revenues, whether now owned or hereafter acquired, other than the
     following:

     (a) Liens pursuant to any Loan Document;

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     (b) Liens  existing on the date hereof and listed on Schedule  8.01 and any
     renewals or extensions thereof,  provided that the property covered thereby
     is not increased;

     (c) Liens for taxes not yet due or that are being  contested  in good faith
     and by appropriate  proceedings,  if adequate reserves with respect thereto
     are  maintained on the books of the  applicable  Person in accordance  with
     GAAP;

     (d) carriers,' warehousemen's,  mechanics,'  materialmen's,  repairmen's or
     other like Liens  arising in the ordinary  course of business  that are not
     overdue for a period of more than  thirty days or that are being  contested
     in good faith and by  appropriate  proceedings,  if adequate  reserves with
     respect thereto are maintained on the books of the applicable Person;

     (e) pledges or deposits in the  ordinary  course of business in  connection
     with  workers'  compensation,   unemployment  insurance  and  other  social
     security legislation, other than any Lien imposed by ERISA;

     (f) deposits to secure the performance of bids,  trade contracts and leases
     (other than Indebtedness),  statutory obligations, surety bonds (other than
     bonds related to judgments or  litigation,  which are covered in subsection
     (h)  below),  performance  bonds and  other  obligations  of a like  nature
     incurred in the ordinary course of business;

     (g) easements,  rights-of-way,  restrictions and other similar encumbrances
     affecting  real property  that, in the  aggregate,  are not  substantial in
     amount,  and that do not in any case  materially  detract from the value of
     the property  subject  thereto or  materially  interfere  with the ordinary
     conduct of the business of the applicable Person;

     (h) Liens  securing  judgments  for the  payment  of money in an  aggregate
     amount not in excess of the Threshold  Amount (except to the extent covered
     by  independent   third-party   insurance  as  to  which  the  insurer  has
     acknowledged in writing its obligation to cover),  unless any such judgment
     remains undischarged for a period of more than forty-five  consecutive days
     during which execution is not effectively stayed;

     (i) Liens securing,  or in respect of,  obligations under capital leases or
     Synthetic  Leases  and  purchase  money  obligations  for fixed or  capital
     assets;  provided  that (i) such  Liens  do not at any  time  encumber  any
     property other than the property financed by such Indebtedness and (ii) the
     Indebtedness secured thereby does not exceed the cost or fair market value,
     whichever  is  lower,  of  the  property  being  acquired  on the  date  of
     acquisition;

     (j) Liens on property or assets of the Borrower or any  Subsidiary  granted
     in  connection  with Sale and  Leaseback  Transactions,  provided  that the
     aggregate

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     Attributable  Principal  Amount in connection  with such Sale and Leaseback
     Transactions shall not at any time be in excess of $100,000,000;

     (k) Liens on property or assets of the Borrower or any  Subsidiary  granted
     in connection with Securitization Transactions, provided that the aggregate
     Attributable  Principal  Amount  in  connection  with  such  Securitization
     Transactions shall not at any time be in excess of $100,000,000.

     (l) Liens on the property and assets of any Person to the extent such Liens
     are existing at the time such Person  becomes a member of the  Consolidated
     Group,  provided such Liens are not created in contemplation thereof and do
     not  extend  to  any  property  or  assets  of  any  other  member  of  the
     Consolidated Group; and

     (m) Liens  other than those  referred to in  subparagraphs  (a) through (l)
     above,  provided,  however,  that the aggregate  amount of all Indebtedness
     that is secured or  evidenced  by such Liens does not at any time exceed an
     amount equal to 10% of Consolidated Net Worth.

     8.02 Investments.

     Make  Investments  in  Subsidiaries,  joint  ventures or other  entities or
     enterprises that are organized  outside the United States and its political
     subdivisions,  unless after giving effect  thereto  there are  Consolidated
     Tangible Domestic Assets of at least $750,000,000.

     8.03 Mergers, Dispositions, etc.

     Merge into or consolidate with any other Person, or permit any other Person
     to merge into or consolidate with it, or sell, transfer, lease or otherwise
     dispose  of (in one  transaction  or in a series  of  transactions)  all or
     substantially  all of its assets (whether now owned or hereafter  acquired)
     or any capital stock of any Subsidiary, except that:

     (a) Any member of the Consolidated Group may purchase and sell inventory in
     the ordinary course of business;

     (b) If at the time thereof and  immediately  after giving effect thereto no
     Default or Event of Default shall have occurred and be continuing:  (i) any
     wholly owned  Subsidiary or any other person may merge into the Borrower in
     a transaction in which the Borrower is the surviving corporation,  (ii) any
     wholly owned Subsidiary may merge into or consolidate with any other wholly
     owned Subsidiary in a transaction in which the surviving entity is a wholly
     owned  Subsidiary  and no person  other than the Borrower or a wholly owned
     Subsidiary  receives any consideration  therefor,  provided that, if either
     wholly owned Subsidiary is a Domestic Subsidiary, the surviving entity is a
     Domestic  Subsidiary,  and  (iii)  so long as (A) the Debt  Ratings  of the
     surviving  corporation  are better than or equal

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     to the Debt  Ratings  of the  Borrower  and (B) the  surviving  corporation
     agrees in writing  to assume the  obligations  of the  Borrower  under this
     Agreement,  the  Borrower  may  merge  into or  consolidate  with any other
     person;

     (c) The Borrower may sell 100% of the capital stock of any  Subsidiary  for
     fair market value,  as determined in good faith by the Borrower's  board of
     directors,  provided  (i) such  sale does not  constitute  a sale of all or
     substantially  all of the  Borrower's  assets and (ii) after giving  effect
     thereto, the Borrower remains in compliance with Section 7.12; and

     (d)  The  Borrower  may  sell  any  portion  of the  capital  stock  of any
     Subsidiary in connection with the  establishment of a joint venture for the
     purpose of developing or continuing a product or business related to any of
     the Borrower's existing lines of business as of the date of this Agreement.

     In connection  with any disposition  permitted  hereunder of any Subsidiary
     that is a Guarantor,  such Guarantor shall be released from its obligations
     under the Guaranty in accordance with the provisions hereof.

     8.04 Change in Nature of Business.

     Engage in any material line of business substantially  different from those
     lines of business conducted by the Consolidated Group on the date hereof or
     any business substantially related or incidental thereto.

     8.05 Transactions with Affiliates.

     Enter into any  transaction of any kind with any Affiliate of the Borrower,
     whether or not in the ordinary  course of business,  other than on fair and
     reasonable  terms  substantially  as  favorable  to the  Borrower  or  such
     Subsidiary as would be obtainable by the Borrower or such Subsidiary at the
     time in a comparable  arm's length  transaction with a Person other than an
     Affiliate,  provided  that the  foregoing  restriction  shall  not apply to
     transactions between or among the Borrower and any Guarantor or between and
     among any Guarantors.

     8.06 Use of Proceeds.

     Use the proceeds of any Credit  Extension,  whether directly or indirectly,
     and whether immediately,  incidentally or ultimately,  to purchase or carry
     margin stock  (within the meaning of  Regulation U of the FRB) or to extend
     credit to others for the purpose of purchasing or carrying  margin stock or
     to refund  indebtedness  originally incurred for such purpose, in each case
     in violation of, or for a purpose that violates,  or would be  inconsistent
     with, Regulation T, U or X of the FRB.

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     8.07 Financial Covenants.

     (a) Consolidated  Interest Coverage Ratio. Permit the Consolidated Interest
     Coverage  Ratio as of the end of any fiscal  quarter of the  Borrower to be
     less than 3.00:1.00.

     (b) Consolidated  Leverage Ratio. Permit the Consolidated Leverage Ratio as
     of the  end of any  fiscal  quarter  of the  Borrower  to be  greater  than
     3.50:1.00.

     8.08 ERISA.

     At any time  engage in a  transaction  that is subject  to Section  4069 or
     4212(c)  of ERISA,  or  permit  any Plan to (a)  engage  in any  non-exempt
     "prohibited transaction" (as defined in Section 4975 of the Code); (b) fail
     to  comply  with  ERISA or any  other  applicable  Laws;  or (c)  incur any
     material  "accumulated  funding  deficiency"  (as defined in Section 302 of
     ERISA),  that, with respect to each event listed above, would reasonably be
     expected to have a Material Adverse Effect.


                                  Article IX.

                         EVENTS OF DEFAULT AND REMEDIES

     9.01 Events of Default.

     Any of the following shall constitute an Event of Default:

     (a) Non-Payment. The Borrower or any other Loan Party fails to pay (i) when
     and as required to be paid herein, in the currency required hereunder,  any
     amount of principal of any Loan or any L/C Obligation, or (ii) within three
     Business  Days after the same  becomes  due, any interest on any Loan or on
     any L/C Obligation,  or any facility fee,  utilization fee or other fee due
     hereunder,  or (iii) within five  Business Days after the same becomes due,
     any other amount payable hereunder or under any other Loan Document; or

     (b) Specific Covenants.  The Borrower fails to perform or observe any term,
     covenant or  agreement  contained in any of Section  7.03,  7.05 or 7.11 or
     Article VIII; or

     (c) Other  Defaults.  Any Loan Party  fails to perform or observe any other
     covenant  or  agreement  (not  specified  in  subsection  (a) or (b) above)
     contained in any Loan  Document on its part to be performed or observed and
     such failure continues for thirty days; or

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     (d)   Representations  and  Warranties.   Any   representation,   warranty,
     certification  or  statement of fact made or deemed made by or on behalf of
     the Borrower or any other Loan Party herein, in any other Loan Document, or
     in any document  delivered  in  connection  herewith or therewith  shall be
     incorrect or misleading when made or deemed made; or

     (e) Cross-Default. (i) The Borrower or any Subsidiary (A) fails to make any
     payment  when due  (whether by  scheduled  maturity,  required  prepayment,
     acceleration,  demand,  or  otherwise)  in respect of any  Indebtedness  or
     Guarantee (other than  Indebtedness  hereunder and Indebtedness  under Swap
     Contracts)  having  an  aggregate   principal  amount  (including   undrawn
     committed or available amounts and including amounts owing to all creditors
     under any  combined  or  syndicated  credit  arrangement)  of more than the
     Threshold Amount, or (B) fails to observe or perform any other agreement or
     condition  relating to any such  Indebtedness  or Guarantee or contained in
     any instrument or agreement  evidencing,  securing or relating thereto,  or
     any other event  occurs,  the effect of which  default or other event is to
     cause,  or to permit  the holder or  holders  of such  Indebtedness  or the
     beneficiary  or  beneficiaries  of such Guarantee (or a trustee or agent on
     behalf of such holder or holders or beneficiary or beneficiaries) to cause,
     with the giving of notice if required,  such Indebtedness to be demanded or
     to  become  due  or  to  be  repurchased,  prepaid,  defeased  or  redeemed
     (automatically or otherwise), or an offer to repurchase, prepay, defease or
     redeem such Indebtedness to be made, prior to its stated maturity,  or such
     Guarantee to become  payable or cash  collateral  in respect  thereof to be
     demanded; or (ii) there occurs under any Swap Contract an Early Termination
     Date (as  defined in such Swap  Contract)  resulting  from (A) any event of
     default under such Swap Contract as to which the Borrower or any Subsidiary
     is the  Defaulting  Party (as  defined  in such Swap  Contract)  or (B) any
     Termination  Event (as so defined) under such Swap Contract as to which the
     Borrower or any  Subsidiary  is an Affected  Party (as so defined)  and, in
     either  event,  the Swap  Termination  Value owed by the  Borrower  or such
     Subsidiary as a result thereof is greater than the Threshold Amount; or

     (f) Insolvency Proceedings, Etc.

     (i) Any Loan Party or any of its Subsidiaries institutes or consents to the
     institution  of any  proceeding  under any Debtor  Relief  Law, or makes an
     assignment for the benefit of creditors;  or applies for or consents to the
     appointment of any receiver, trustee, custodian,  conservator,  liquidator,
     rehabilitator  or similar officer for it or for all or any material part of
     its property; or

     (ii)   Any   receiver,   trustee,   custodian,   conservator,   liquidator,
     rehabilitator  or similar  officer is appointed  without the application or
     consent of such Person and the appointment  continues undismissed for sixty
     calendar days, or an order or decree approving or ordering such

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     appointment  shall  continue  unstayed  for thirty  calendar  days;  or any
     proceeding  under any Debtor  Relief Law  relating to any such Person or to
     all or any material part of its property is instituted  without the consent
     of such Person and continues  undismissed  for sixty  calendar  days, or an
     order or decree  approving  or  ordering  such  proceeding  shall  continue
     unstayed for thirty calendar days; or

     (g) Inability to Pay Debts; Attachment.

     (i) The Borrower or any Subsidiary  becomes unable or admits in writing its
     inability or fails generally to pay its debts as they become due; or

     (ii) Any writ or warrant of attachment  or execution or similar  process is
     issued or levied  against all or any  material  part of the property of any
     such Person and such process,  if not fully bonded,  continues  undismissed
     for sixty calendar  days, or an order or decree  approving or ordering such
     process shall continue unstayed for thirty calendar days; or

     (h) Judgments.  There is entered against the Borrower or any Subsidiary (i)
     a final  judgment or order for the payment of money in an aggregate  amount
     exceeding  the Threshold  Amount (to the extent not covered by  independent
     third-party  insurance as to which the insurer does not dispute  coverage),
     or (ii) any one or more  non-monetary  final  judgments that have, or would
     reasonably  be  expected  to  have,  individually  or in the  aggregate,  a
     Material  Adverse Effect and, in either case, (A)  enforcement  proceedings
     are commenced by any creditor upon such judgment or order,  or (B) there is
     a period of forty-five  consecutive days during which a stay of enforcement
     of such  judgment,  by reason of a pending  appeal or otherwise,  is not in
     effect; or

     (i) ERISA.  (i) An ERISA  Event  occurs with  respect to a Pension  Plan or
     Multiemployer  Plan that has  resulted or would  reasonably  be expected to
     result in liability of the Borrower  under Title IV of ERISA to the Pension
     Plan,  Multiemployer  Plan or the PBGC in an aggregate  amount in excess of
     the Threshold  Amount, or (ii) the Borrower or any ERISA Affiliate fails to
     pay when due,  after the  expiration of any  applicable  grace period,  any
     installment payment with respect to its withdrawal  liability under Section
     4201 of ERISA under a Multiemployer  Plan in an aggregate  amount in excess
     of the Threshold Amount; or

     (j) Invalidity of Loan Documents.  Any Loan Document, at any time after its
     execution and delivery and for any reason other than as expressly permitted
     hereunder or satisfaction in full of all the  Obligations,  ceases to be in
     full force and effect;  or any Loan Party or any other  Person  contests in
     any manner the validity or enforceability of any Loan Document; or any Loan
     Party

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     denies that it has any or further  liability or  obligation  under any Loan
     Document, or purports to revoke, terminate or rescind any Loan Document; or

     (k) Change of Control.  There  occurs any Change of Control with respect to
     the Borrower.

     9.02 Remedies Upon Event of Default.

     If any Event of Default occurs and is continuing,  the Administrative Agent
     shall,  at the  request  of, or may,  with the  consent  of,  the  Required
     Lenders, take any or all of the following actions:

     (a) declare the  commitment of each Lender to make Loans and any obligation
     of the L/C Issuer to make L/C Credit Extensions to be terminated, whereupon
     such commitments and obligation shall be terminated;

     (b) declare  the unpaid  principal  amount of all  outstanding  Loans,  all
     interest accrued and unpaid thereon, and all other amounts owing or payable
     hereunder  or under any  other  Loan  Document  to be  immediately  due and
     payable, without presentment,  demand, protest or other notice of any kind,
     all of which are hereby expressly waived by the Borrower;

     (c) require that the Borrower Cash Collateralize the L/C Obligations (in an
     amount  equal  to the  Dollar  Equivalent  of the then  Outstanding  Amount
     thereof as such amount may vary from time to time); and

     (d)  exercise on behalf of itself and the  Lenders all rights and  remedies
     available to it and the Lenders under the Loan Documents or applicable law;

     provided, however, that upon the occurrence of an actual or deemed entry of
     an order for relief with respect to the Borrower under the Bankruptcy  Code
     of the United  States,  the obligation of each Lender to make Loans and any
     obligation  of  the  L/C  Issuer  to  make  L/C  Credit   Extensions  shall
     automatically  terminate,  the unpaid  principal  amount of all outstanding
     Loans and all interest and other amounts as aforesaid  shall  automatically
     become  due  and  payable,  and  the  obligation  of the  Borrower  to Cash
     Collateralize the L/C Obligations as aforesaid shall  automatically  become
     effective,  in each case without further act of the Administrative Agent or
     any Lender.

     9.03 Application of Funds.

     After the  exercise of remedies  provided for in Section 9.02 (or after the
     Loans have  automatically  become  immediately  due and payable and the L/C
     Obligations have automatically  been required to be Cash  Collateralized as
     set forth in the proviso to Section 9.02),  any amounts received on account
     of the  Obligations  shall be  applied by the  Administrative  Agent in the
     following order:

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     First,  to payment of that portion of the  Obligations  constituting  fees,
     indemnities,  expenses  and other  amounts  (including  Attorney  Costs and
     amounts payable under Article III) payable to the  Administrative  Agent in
     its capacity as such;

     Second,  to payment of that portion of the Obligations  constituting  fees,
     indemnities  and other amounts (other than principal and interest)  payable
     to the Lenders (including  Attorney Costs and amounts payable under Article
     III),  ratably among them in  proportion  to the amounts  described in this
     clause Second payable to them;

     Third, to payment of that portion of the Obligations  constituting  accrued
     and unpaid  interest  on the Loans and L/C  Borrowings,  ratably  among the
     Lenders in proportion to the  respective  amounts  described in this clause
     Third payable to them;

     Fourth, to payment of that portion of the Obligations  constituting  unpaid
     principal of the Loans,  L/C Borrowings and Swap  Contracts,  ratably among
     the Lenders in  proportion  to the  respective  amounts  described  in this
     clause Fourth held by them;

     Fifth, to the  Administrative  Agent for the account of the L/C Issuer,  to
     Cash  Collateralize  that  portion  of  L/C  Obligations  comprised  of the
     aggregate undrawn amount of Letters of Credit; and

     Last,  the  balance,  if  any,  after  all of  the  Obligations  have  been
     indefeasibly paid in full, to the Borrower or as otherwise required by Law.

     Subject  to  Section  2.03(c),  amounts  used  to  Cash  Collateralize  the
     aggregate  undrawn  amount of Letters of Credit  pursuant  to clause  Fifth
     above shall be applied to satisfy  drawings under such Letters of Credit as
     they occur. If any amount remains on deposit as Cash  Collateral  after all
     Letters of Credit have either been fully drawn or expired,  such  remaining
     amount shall be applied to the other Obligations,  if any, in the order set
     forth above.


                                   Article X.

                              ADMINISTRATIVE AGENT

     10.01 Appointment and Authorization of Administrative Agent.

     (a) Each Lender hereby irrevocably appoints,  designates and authorizes the
     Administrative Agent to take such action on its behalf under the provisions
     of this  Agreement and each other Loan Document and to exercise such powers
     and perform  such duties as are  expressly  delegated to it by the terms of
     this Agreement or any other Loan Document, together with such powers as are
     reasonably  incidental  thereto.

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     Notwithstanding any provision to the contrary contained elsewhere herein or
     in any other Loan  Document,  the  Administrative  Agent shall not have any
     duties or  responsibilities,  except those expressly set forth herein,  nor
     shall the  Administrative  Agent  have or be  deemed to have any  fiduciary
     relationship  with any Lender or  participant,  and no  implied  covenants,
     functions,  responsibilities,  duties,  obligations or liabilities shall be
     read into this  Agreement  or any other Loan  Document or  otherwise  exist
     against the  Administrative  Agent.  Without limiting the generality of the
     foregoing  sentence,  the use of the term  "agent"  herein and in the other
     Loan Documents with reference to the  Administrative  Agent is not intended
     to connote any fiduciary or other implied (or express)  obligations arising
     under agency  doctrine of any applicable  Law.  Instead,  such term is used
     merely as a matter of market  custom,  and is intended to create or reflect
     only  an  administrative   relationship  between  independent   contracting
     parties.

     (b) The L/C Issuer  shall act on behalf of the Lenders  with respect to any
     Letters of Credit issued by it and the documents associated therewith,  and
     the L/C Issuer shall have all of the benefits and  immunities  (i) provided
     to the  Administrative  Agent in this  Article X with  respect  to any acts
     taken or omissions suffered by the L/C Issuer in connection with Letters of
     Credit issued by it or proposed to be issued by it and the applications and
     agreements  for letters of credit  pertaining  to such Letters of Credit as
     fully as if the term  "Administrative  Agent" as used in this Article X and
     in the definition of  "Agent-Related  Person"  included the L/C Issuer with
     respect to such acts or omissions, and (ii) as additionally provided herein
     with respect to the L/C Issuer.

     10.02 Delegation of Duties.

     The Administrative Agent may execute any of its duties under this Agreement
     or  any  other  Loan   Document  by  or  through   agents,   employees   or
     attorneys-in-fact  and shall be  entitled  to advice of  counsel  and other
     consultants or experts  concerning  all matters  pertaining to such duties.
     The  Administrative  Agent shall not be  responsible  for the negligence or
     misconduct of any agent or attorney-in-fact  that it selects in the absence
     of gross negligence or willful misconduct.

     10.03 Liability of Administrative Agent.

     No Agent-Related Person shall (a) be liable for any action taken or omitted
     to be taken by any of them under or in  connection  with this  Agreement or
     any other Loan Document or the transactions contemplated hereby (except for
     its own gross  negligence  or willful  misconduct  in  connection  with its
     duties expressly set forth herein),  or (b) be responsible in any manner to
     any Lender or participant  for any recital,  statement,  representation  or
     warranty made by any Loan Party or any officer thereof, contained herein or
     in any other Loan Document,  or in any  certificate,  report,  statement or
     other  document  referred  to or  provided  for  in,  or  received  by  the
     Administrative  Agent under or in connection  with,  this  Agreement or any
     other  Loan  Document,   or  the  validity,   effectiveness,   genuineness,
     enforceability or sufficiency of this Agreement or any other Loan Document,
     or for any  failure  of any  Loan  Party  or any  other  party  to any Loan

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     Document  to  perform  its   obligations   hereunder  or   thereunder.   No
     Agent-Related  Person  shall be  under  any  obligation  to any  Lender  or
     participant  to ascertain or to inquire as to the observance or performance
     of any of the agreements  contained in, or conditions of, this Agreement or
     any other Loan Document, or to inspect the properties,  books or records of
     any Loan Party or any Affiliate thereof.

     10.04 Reliance by Administrative Agent.

     (a) The Administrative  Agent shall be entitled to rely, and shall be fully
     protected  in  relying,   upon  any  writing,   communication,   signature,
     resolution,   representation,   notice,  consent,  certificate,  affidavit,
     letter, telegram,  facsimile,  telex or telephone message,  electronic mail
     message,  statement or other document or conversation  believed by it to be
     genuine  and correct  and to have been  signed,  sent or made by the proper
     Person  or  Persons,  and upon  advice  and  statements  of  legal  counsel
     (including  counsel to any Loan Party),  independent  accountants and other
     experts  selected by the  Administrative  Agent. The  Administrative  Agent
     shall be fully  justified  in failing or refusing to take any action  under
     any Loan Document  unless it shall first receive such advice or concurrence
     of the Required Lenders as it deems appropriate and, if it so requests,  it
     shall first be indemnified to its  satisfaction  by the Lenders against any
     and all  liability  and  expense  that may be  incurred  by it by reason of
     taking or  continuing  to take any such action.  The  Administrative  Agent
     shall in all cases be fully  protected  in acting,  or in  refraining  from
     acting,  under this Agreement or any other Loan Document in accordance with
     a request or consent of the  Required  Lenders (or such  greater  number of
     Lenders  as may be  expressly  required  hereby in any  instance)  and such
     request and any action  taken or failure to act pursuant  thereto  shall be
     binding upon all the Lenders.

     (b) For purposes of determining compliance with the conditions specified in
     Section 5.01, each Lender that has signed this Agreement shall be deemed to
     have  consented  to,  approved or accepted or to be  satisfied  with,  each
     document or other matter required thereunder to be consented to or approved
     by or acceptable  or  satisfactory  to a Lender  unless the  Administrative
     Agent shall have  received  notice from such Lender  prior to the  proposed
     Closing Date specifying its objection thereto.

     10.05 Notice of Default.

     The Administrative Agent shall not be deemed to have knowledge or notice of
     the  occurrence  of any  Default,  except  with  respect to defaults in the
     payment  of  principal,  interest  and  fees  required  to be  paid  to the
     Administrative   Agent  for  the  account  of  the   Lenders,   unless  the
     Administrative  Agent shall have received  written  notice from a Lender or
     the  Borrower  referring  to this  Agreement,  describing  such Default and
     stating that such notice is a "notice of default." The Administrative Agent
     will  notify  the  Lenders  of  its  receipt  of  any  such   notice.   The
     Administrative Agent shall take such action with respect to such Default as
     may be directed by the  Required  Lenders in  accordance  with  Article IX;
     provided,  however,  that  unless  and until the  Administrative  Agent has
     received any such direction, the Administrative Agent may (but shall not be
     obligated  to)

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     take such action, or refrain from taking such action,  with respect to such
     Default as it shall deem advisable or in the best interest of the Lenders.

     10.06 Credit Decision; Disclosure of Information by Administrative Agent.

     Each  Lender  acknowledges  that  no  Agent-Related  Person  has  made  any
     representation  or  warranty  to it, and that no act by the  Administrative
     Agent  hereafter  taken,  including  any consent to and  acceptance  of any
     assignment  or review of the  affairs  of any Loan  Party or any  Affiliate
     thereof,  shall be deemed to constitute any  representation  or warranty by
     any Agent-Related Person to any Lender as to any matter,  including whether
     Agent-Related   Persons  have  disclosed  material   information  in  their
     possession. Each Lender represents to the Administrative Agent that it has,
     independently and without reliance upon any Agent-Related  Person and based
     on such documents and  information as it has deemed  appropriate,  made its
     own  appraisal  of  and   investigation   into  the  business,   prospects,
     operations, property, financial and other condition and creditworthiness of
     the Loan Parties and their respective Subsidiaries, and all applicable bank
     or other regulatory Laws relating to the transactions  contemplated hereby,
     and made its own decision to enter into this Agreement and to extend credit
     to the  Borrower  and the other Loan  Parties  hereunder.  Each Lender also
     represents  that it  will,  independently  and  without  reliance  upon any
     Agent-Related  Person and based on such  documents  and  information  as it
     shall  deem  appropriate  at the  time,  continue  to make  its own  credit
     analysis,  appraisals  and  decisions in taking or not taking  action under
     this   Agreement   and  the  other  Loan   Documents,   and  to  make  such
     investigations  as it deems  necessary to inform itself as to the business,
     prospects,   operations,   property,  financial  and  other  condition  and
     creditworthiness  of the  Borrower and the other Loan  Parties.  Except for
     notices,  reports and other documents expressly required to be furnished to
     the Lenders by the Administrative  Agent herein,  the Administrative  Agent
     shall not have any duty or  responsibility  to provide  any Lender with any
     credit or other information concerning the business, prospects, operations,
     property,  financial and other condition or  creditworthiness of any of the
     Loan Parties or any of their  respective  Affiliates that may come into the
     possession of any Agent-Related Person.

     10.07 Indemnification of Administrative Agent.

     Whether or not the transactions  contemplated  hereby are consummated,  the
     Lenders  shall  indemnify  upon  demand each  Agent-Related  Person (to the
     extent  not  reimbursed  by or on  behalf  of any Loan  Party  and  without
     limiting the  obligation  of any Loan Party to do so),  pro rata,  and hold
     harmless each Agent-Related Person from and against any and all Indemnified
     Liabilities  incurred by it;  provided,  however,  that no Lender  shall be
     liable for the payment to any  Agent-Related  Person of any portion of such
     Indemnified Liabilities to the extent determined in a final,  nonappealable
     judgment by a court of competent  jurisdiction  to have  resulted from such
     Agent-Related   Person's  own  gross  negligence  or  willful   misconduct;
     provided,  however,  that no action taken in accordance with the directions
     of the Required  Lenders shall be deemed to constitute  gross negligence or
     willful misconduct for purposes of this Section.  Without limitation of the

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     foregoing, each Lender shall reimburse the Administrative Agent upon demand
     for its ratable  share of any costs or  out-of-pocket  expenses  (including
     Attorney Costs) 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,   any  other  Loan  Document,   or  any  document
     contemplated   by  or   referred   to  herein,   to  the  extent  that  the
     Administrative Agent is not reimbursed for such expenses by or on behalf of
     the Borrower.  The undertaking in this Section shall survive termination of
     the Aggregate  Commitments,  the payment of all other  Obligations  and the
     resignation of the Administrative Agent.

     10.08 Administrative Agent in its Individual Capacity.

     Bank of America  and its  Affiliates  may make loans to,  issue  letters of
     credit for the account of, accept deposits from,  acquire equity  interests
     in and generally engage in any kind of banking,  trust, financial advisory,
     underwriting  or other  business  with each of the Loan  Parties  and their
     respective Affiliates as though Bank of America were not the Administrative
     Agent or the L/C Issuer  hereunder and without  notice to or consent of the
     Lenders. The Lenders acknowledge that, pursuant to such activities, Bank of
     America or its Affiliates may receive information  regarding any Loan Party
     or  its  Affiliates   (including   information   that  may  be  subject  to
     confidentiality  obligations in favor of such Loan Party or such Affiliate)
     and acknowledge that the Administrative  Agent shall be under no obligation
     to provide such  information  to them.  With respect to its Loans,  Bank of
     America  shall have the same rights and powers under this  Agreement as any
     other Lender and may exercise  such rights and powers as though it were not
     the  Administrative  Agent or the L/C Issuer,  and the terms  "Lender"  and
     "Lenders" include Bank of America in its individual capacity.

     10.09 Successor Administrative Agent.

     The  Administrative  Agent may resign as  Administrative  Agent upon thirty
     days' notice to the Lenders;  provided that any such resignation by Bank of
     America shall also  constitute its resignation as L/C Issuer and Swing Line
     Lender.  If the  Administrative  Agent  resigns under this  Agreement,  the
     Required   Lenders  shall  appoint  from  among  the  Lenders  a  successor
     administrative agent for the Lenders, which successor  administrative agent
     shall be  consented  to by the  Borrower at all times other than during the
     existence of an Event of Default  (which  consent of the Borrower shall not
     be unreasonably withheld or delayed). If no successor  administrative agent
     is  appointed  prior  to  the  effective  date  of the  resignation  of the
     Administrative   Agent,  the  Administrative   Agent  may  appoint,   after
     consulting  with the Lenders and the Borrower,  a successor  administrative
     agent from among the Lenders.  Upon the  acceptance of its  appointment  as
     successor  administrative  agent  hereunder,  the  Person  acting  as  such
     successor  administrative agent shall succeed to all the rights, powers and
     duties of the  retiring  Administrative  Agent,  L/C  Issuer and Swing Line
     Lender and the respective  terms  "Administrative  Agent," "L/C Issuer" and
     "Swing Line Lender" shall mean such successor  administrative agent, Letter
     of Credit  issuer and swing line lender,  and the

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     retiring   Administrative   Agent's  appointment,   powers  and  duties  as
     Administrative  Agent shall be terminated and the retiring L/C Issuer's and
     Swing Line Lender's rights,  powers and duties as such shall be terminated,
     without any other or further act or deed on the part of such  retiring  L/C
     Issuer or Swing Line Lender or any other Lender,  other than the obligation
     of the successor L/C Issuer to issue letters of credit in substitution  for
     the Letters of Credit,  if any,  outstanding at the time of such succession
     or to make other  arrangements  satisfactory  to the retiring L/C Issuer to
     effectively  assume the obligations of the retiring L/C Issuer with respect
     to such  Letters  of  Credit.  After any  retiring  Administrative  Agent's
     resignation  hereunder as  Administrative  Agent,  the  provisions  of this
     Article X and Sections 11.04 and 11.05 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.  If no  successor  administrative  agent has
     accepted  appointment  as  Administrative  Agent  by the date  thirty  days
     following a retiring  Administrative  Agent's  notice of  resignation,  the
     retiring  Administrative  Agent's resignation shall nevertheless  thereupon
     become  effective  and the Lenders  shall  perform all of the duties of the
     Administrative  Agent  hereunder  until such time,  if any, as the Required
     Lenders appoint a successor agent as provided for above.

     10.10 Administrative Agent May File Proofs of Claim.

     In case  of the  pendency  of any  receivership,  insolvency,  liquidation,
     bankruptcy,  reorganization,  arrangement, adjustment, composition or other
     judicial  proceeding  relative to any Loan Party, the Administrative  Agent
     (irrespective  of whether the principal of any Loan or L/C Obligation shall
     then be due and payable as herein  expressed or by declaration or otherwise
     and  irrespective of whether the  Administrative  Agent shall have made any
     demand on the Borrower) shall be entitled and empowered, by intervention in
     such proceeding or otherwise:

     (a) to file and  prove a claim for the whole  amount of the  principal  and
     interest owing and unpaid in respect of the Loans,  L/C Obligations and all
     other Obligations (other than Swap Contracts) that are owing and unpaid and
     to file such other  documents  as may be necessary or advisable in order to
     have the claims of the Lenders and the Administrative  Agent (including any
     claim for the reasonable compensation, expenses, disbursements and advances
     of the Lenders and the Administrative Agent and their respective agents and
     counsel and all other amounts due the Lenders and the Administrative  Agent
     under  Sections  2.03(i) and (j), 2.09 and 11.04)  allowed in such judicial
     proceeding; and

     (b) to  collect  and  receive  any  monies  or other  property  payable  or
     deliverable  on  any  such  claims  and  to  distribute  the  same;and  any
     custodian,  receiver, assignee, trustee, liquidator,  sequestrator or other
     similar  official in any such judicial  proceeding is hereby  authorized by
     each Lender to make such payments to the  Administrative  Agent and, in the
     event that the  Administrative  Agent  shall  consent to the making of such
     payments directly to the Lenders,  to pay to the  Administrative  Agent any
     amount due for the reasonable  compensation,  expenses,

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     disbursements and advances of the  Administrative  Agent and its agents and
     counsel,  and any other amounts due the Administrative Agent under Sections
     2.09 and 11.04.

     Nothing  contained  herein shall be deemed to authorize the  Administrative
     Agent to authorize or consent to or accept or adopt on behalf of any Lender
     any  plan  of  reorganization,   arrangement,   adjustment  or  composition
     affecting the  Obligations  or the rights of any Lender or to authorize the
     Administrative  Agent to vote in  respect of the claim of any Lender in any
     such proceeding.

     10.11 Guaranty Matters.

     The Lenders irrevocably  authorize the Administrative  Agent, at its option
     and in its discretion,  to release any Guarantor from its obligations under
     the  Guaranty if such  Person  ceases to be a  Subsidiary  as a result of a
     transaction  permitted hereunder.  Upon request by the Administrative Agent
     at  any  time,   the   Required   Lenders   will  confirm  in  writing  the
     Administrative   Agent's  authority  to  release  any  Guarantor  from  its
     obligations under the Guaranty pursuant to this Section 10.12.

     10.12 Other Agents; Arrangers and Managers.

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


                                  Article XI.

                                 MISCELLANEOUS

     11.01 Amendments, Etc.

     No amendment or waiver of any provision of this Agreement or any other Loan
     Document, and no consent to any departure by the Borrower or any other Loan
     Party  therefrom,  shall be  effective  unless  in  writing  signed  by the
     Required Lenders and the Borrower and the Loan Parties, and acknowledged by
     the  Administrative  Agent,  and  each  such  waiver  or  consent  shall be
     effective  only in the specific  instance and for the specific  purpose for
     which given; provided,  however, that no such amendment,  waiver or consent
     shall,  unless  in  writing  and  signed  by each of the  Lenders  directly
     affected

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     thereby and by the Borrower,  and acknowledged by the Administrative Agent,
     do any of the following:

     (a) extend or  increase  the  Commitment  of any Lender (or  reinstate  any
     Commitment terminated pursuant to Section 9.02), it being understood that a
     waiver of an Event of Default or a mandatory  reduction in  Commitments  is
     not considered an increase in Commitments;

     (b)  postpone any date fixed by this  Agreement or any other Loan  Document
     for any payment of  principal,  interest,  fees or other amounts due to any
     Lender hereunder or under any other Loan Document;

     (c) reduce the principal of, or the rate of interest  specified  herein on,
     any Loan or L/C Borrowing, or (subject to clause (vi) of the second proviso
     to this Section 11.01) any fees or other amounts payable hereunder or under
     any other Loan Document without the written consent of each Lender directly
     affected thereby; provided,  however, that only the consent of the Required
     Lenders shall be necessary to amend the  definition of "Default Rate" or to
     waive any obligation of the Borrower to pay interest at the Default Rate;

     (d) change any  provision of this  Agreement  regarding pro rata sharing or
     pro rata  funding  with  respect to (i) the making of  advances  (including
     participations),  (ii) the manner of application of payments or prepayments
     of  principal,  interest,  the Facility  Fee, the  Utilization  Fee and the
     Letter of Credit Fees (other than  fronting fees for the account of the L/C
     Issuers), (iii) the manner of application of reimbursement obligations from
     drawings  under  Letters of Credit,  or (iv) the manner of reduction of the
     respective commitments and committed amounts;

     (e) change any  provision  of this Section or the  definition  of "Required
     Lenders" or any other provision hereof  specifying the number or percentage
     of  Lenders  required  to  amend,  waive or  otherwise  modify  any  rights
     hereunder or make any determination or grant any consent hereunder;

     (f)  amend the  definition  of  "Alternative  Currency"  to add  additional
     currencies; or

     (g)  release  all  or  substantially  all  of  the  Guarantors  from  their
     obligations hereunder; and, provided further, that (i) no amendment, waiver
     or consent shall,  unless in writing and signed by Lenders having more than
     50% of the Aggregate Domestic  Commitments or, if the Domestic  Commitments
     have been  terminated,  Lenders  holding more than 50% of the Domestic Loan
     Obligations (including, in each case, the aggregate amount of such Lender's
     risk participation and funded participation in Domestic L/C Obligations and
     Swing Line Loans),  waive any of the  conditions  in Section 5.02 to Credit
     Extensions of Domestic Loan  Obligations  or extend the time for,

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     or reduce the  amount,  or  otherwise  alter the manner of  application  of
     proceeds (with respect to  prepayments  under Section 2.05 or otherwise) in
     respect  of  Domestic  Commitments,  (ii) no  amendment,  waiver or consent
     shall,  unless in writing and signed by Lenders having more than 50% of the
     Aggregate  Multicurrency  Commitments or, if the Multicurrency  Commitments
     have been  terminated,  Lenders holding more than 50% of the  Multicurrency
     Loan  Obligations  (including,  in each case, the aggregate  amount of such
     Lender's risk  participation and funded  participation in Multicurrency L/C
     Obligations),  waive  any of the  conditions  in  Section  5.02  to  Credit
     Extensions of  Multicurrency  Loan  Obligations  or extend the time for, or
     reduce the amount, or otherwise alter the manner of application of proceeds
     (with respect to prepayments under Section 2.05 or otherwise) in respect of
     Multicurrency  Commitments,  (iii) no amendment,  waiver or consent  shall,
     unless in writing  and signed by the L/C Issuer in  addition to the Lenders
     required  above,  affect the rights or duties of the L/C Issuer  under this
     Agreement  or any Letter of Credit  Application  relating  to any Letter of
     Credit issued or to be issued by it; (iv) no  amendment,  waiver or consent
     shall, unless in writing and signed by the Swing Line Lender in addition to
     the Lenders  required above,  affect the rights or duties of the Swing Line
     Lender under this  Agreement;  (v) no amendment,  waiver or consent  shall,
     unless in writing and signed by the Administrative Agent in addition to the
     Lenders required above,  affect the rights or duties of the  Administrative
     Agent under this  Agreement  or any other Loan  Document;  and (vi) the Fee
     Letter may be amended,  or rights or  privileges  thereunder  waived,  in a
     writing executed only by the parties thereto.  Notwithstanding  anything to
     the contrary herein,  no Defaulting  Lender shall have any right to approve
     or disapprove any amendment,  waiver or consent hereunder,  except that the
     Commitment  of such Lender may not be  increased  or  extended  without the
     consent of such Lender.

     11.02 Notices and Other Communications; Facsimile Copies.

     (a) General.  Unless otherwise  expressly  provided herein, all notices and
     other communications  provided for hereunder shall be in writing (including
     by facsimile transmission). All such written notices shall be mailed, faxed
     or delivered to the  applicable  address,  facsimile  number or (subject to
     subsection (c) below)  electronic  mail address,  and all notices and other
     communications expressly permitted hereunder to be given by telephone shall
     be made to the applicable telephone number, as follows: if to the Borrower,
     the  Administrative  Agent,  the L/C  Issuer,  the Swing Line Lender or any
     Lender,  to the  address,  facsimile  number,  electronic  mail  address or
     telephone  number  specified  for such Person on Schedule  11.02 or to such
     other  address,  facsimile  number,  electronic  mail  address or telephone
     number  as shall be  designated  by such  party  in a notice  to the  other
     parties.

     All such  notices and other  communications  shall be deemed to be given or
     made upon the earlier to occur of (i) actual  receipt by the relevant party
     hereto and (ii) (A) if delivered by hand or by courier,  when signed for by
     or on behalf of the relevant party hereto;  (B) if delivered by mail,  four
     Business Days after deposit in the mails, postage prepaid; (C) if delivered
     by facsimile,  when sent and receipt has been  confirmed by telephone;  and
     (D) if delivered by  electronic  mail (which form of delivery is subject to

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     the provisions of subsection (c) below), when delivered; provided, however,
     that notices and other communications to the Administrative  Agent, the L/C
     Issuer  and the Swing  Line  Lender  pursuant  to  Article  II shall not be
     effective  until  actually  received  by such  Person.  In no event shall a
     voicemail  message be effective as a notice,  communication or confirmation
     hereunder.

     (b) Effectiveness of Facsimile Documents and Signatures. Loan Documents may
     be transmitted  and/or signed by facsimile.  The  effectiveness of any such
     documents and signatures  shall,  subject to applicable  Law, have the same
     force and effect as manually  signed  originals and shall be binding on all
     Loan Parties,  the Administrative Agent and the Lenders. The Administrative
     Agent may also require that any such  documents and signatures be confirmed
     by a manually signed original thereof; provided,  however, that the failure
     to  request or deliver  the same shall not limit the  effectiveness  of any
     facsimile document or signature.

     (c)  Limited Use of  Electronic  Mail.  Electronic  mail and  internet  and
     intranet  websites may be used only to distribute  routine  communications,
     such as financial  statements and other  information as provided in Section
     7.02,  and to  distribute  Loan  Documents  for  execution  by the  parties
     thereto, and may not be used for any other purpose.

     (d) Reliance by Administrative  Agent and Lenders. The Administrative Agent
     and the  Lenders  shall  be  entitled  to rely  and act  upon  any  notices
     (including  telephonic  Committed Loan Notices and Swing Line Loan Notices)
     purportedly  given by or on  behalf of the  Borrower  and  received  by the
     Administrative Agent and the Lenders in good faith even if (i) such notices
     were not made in a manner  specified  herein,  were  incomplete or were not
     preceded or followed by any other form of notice specified  herein, or (ii)
     the  terms  thereof,  as  understood  by the  recipient,  varied  from  any
     confirmation  thereof.  The Borrower  shall  indemnify  each  Agent-Related
     Person and each Lender from all losses,  costs,  expenses  and  liabilities
     resulting from the reliance by such Person on each notice purportedly given
     by or on  behalf  of the  Borrower.  All  telephonic  notices  to and other
     communications  with  the  Administrative  Agent  may  be  recorded  by the
     Administrative  Agent,  and each of the parties  hereto hereby  consents to
     such recording.

     11.03 No Waiver; Cumulative Remedies

     No failure by any Lender or the  Administrative  Agent to exercise,  and no
     delay by any  such  Person  in  exercising,  any  right,  remedy,  power or
     privilege hereunder shall operate as a waiver thereof; nor shall any single
     or partial  exercise of any right,  remedy,  power or  privilege  hereunder
     preclude any other or further exercise thereof or the exercise of any other
     right,  remedy,  power or  privilege.  The  rights,  remedies,  powers  and
     privileges  herein provided are cumulative and not exclusive of any rights,
     remedies, powers and privileges provided by law.

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     11.04 Attorney Costs, Expenses and Taxes

     The Borrower  agrees (a) to pay or reimburse the  Administrative  Agent for
     all  reasonable  costs  and  expenses   incurred  in  connection  with  the
     preparation, negotiation and execution of this Agreement and the other Loan
     Documents and any amendment,  waiver,  consent or other modification of the
     provisions hereof and thereof (whether or not the transactions contemplated
     hereby or thereby are consummated), and the consummation and administration
     of the transactions contemplated hereby and thereby, including all Attorney
     Costs and costs and expenses in connection with the use of Intralinks, Inc.
     or other similar information  transmission  systems in connection with this
     Agreement,  and (b) to pay or reimburse the  Administrative  Agent and each
     Lender  for  all  costs  and  expenses  incurred  in  connection  with  the
     enforcement,  attempted  enforcement,  or  preservation  of any  rights  or
     remedies under this  Agreement or the other Loan  Documents  (including all
     such costs and expenses  incurred during any "workout" or  restructuring in
     respect of the Obligations and during any legal  proceeding,  including any
     proceeding under any Debtor Relief Law),  including all Attorney Costs. The
     foregoing costs and expenses shall include out-of-pocket  expenses incurred
     by the Administrative  Agent and the cost of independent public accountants
     and other  outside  experts  retained  by the  Administrative  Agent or any
     Lender; provided that, so long as no Default or Event of Default exists and
     is  continuing  under this  Agreement,  such costs and  expenses  shall not
     include  independent  audits on behalf of the  Administrative  Agent or any
     Lender.  All amounts due under this Section  11.04 shall be payable  within
     ten Business  Days after demand  therefor.  The  agreements in this Section
     shall survive the termination of the Aggregate Commitments and repayment of
     all other Obligations.

     11.05 Indemnification by the Borrower.

     Whether or not the transactions  contemplated  hereby are consummated,  the
     Borrower agrees to indemnify and hold harmless each  Agent-Related  Person,
     each  Lender  and  their  respective   Affiliates,   directors,   officers,
     employees,   counsel,   agents  and  attorneys-in-fact   (collectively  the
     "Indemnitees")  from  and  against  any and all  liabilities,  obligations,
     losses, damages,  penalties,  claims, demands, actions,  judgments,  suits,
     costs, expenses and disbursements (including Attorney Costs) of any kind or
     nature whatsoever (other than Taxes,  Other Taxes and Excluded Taxes (as to
     which Section 3.01 governs))  that may at any time be imposed on,  incurred
     by or  asserted  against  any such  Indemnitee  in any way  relating  to or
     arising  out  of  or  in  connection  with  (a)  the  execution,  delivery,
     enforcement,  performance  or  administration  of any Loan  Document or any
     other  agreement,  letter or instrument  delivered in  connection  with the
     transactions  contemplated  thereby or the consummation of the transactions
     contemplated  thereby, (b) any Commitment,  Loan or Letter of Credit or the
     use or proposed use of the proceeds therefrom (including any refusal by the
     L/C  Issuer to honor a demand for  payment  under a Letter of Credit if the
     documents  presented in connection  with such demand do not strictly comply
     with the terms of such  Letter of  Credit),  or (c) any  actual or  alleged
     presence  or  release  of  Hazardous  Materials  on or  from  any  property
     currently  or formerly  owned or operated by the  Borrower,  any other Loan
     Party, or any of their Subsidiaries, or any Environmental Liability related
     in any

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     way to the Borrower,  any other Loan Party,  or any of their  Subsidiaries,
     that  has  arisen  because  of  such  Indemnitee's  relationship  with  the
     Borrower,  any other Loan Party, or any of their  Subsidiaries,  or (d) any
     actual  or  threatened  claim,  litigation,   investigation  or  proceeding
     relating to any of the  foregoing,  whether based on contract,  tort or any
     other theory (including any  investigation of,  preparation for, or defense
     of  any  pending  or  threatened   claim,   investigation,   litigation  or
     proceeding)  and  regardless  of whether any  Indemnitee is a party thereto
     (all the foregoing, collectively, the "Indemnified Liabilities");  provided
     that such indemnity  shall not, as to any  Indemnitee,  be available to the
     extent that such  liabilities,  obligations,  losses,  damages,  penalties,
     claims,   demands,   actions,   judgments,   suits,   costs,   expenses  or
     disbursements are determined by a court of competent  jurisdiction by final
     and  nonappealable  judgment to have resulted from the gross  negligence or
     willful  misconduct  of such  Indemnitee.  Except  to the  extent  directly
     resulting from an Indemnitee's gross negligence or willful misconduct, such
     Indemnitee (i) shall not be liable for any damages  arising from the use by
     others of any information or other materials obtained through IntraLinks or
     other similar  information  transmission  systems in  connection  with this
     Agreement,  and (ii)  shall  not have any  liability  for any  indirect  or
     consequential damages relating to this Agreement or any other Loan Document
     or arising  out of its  activities  in  connection  herewith  or  therewith
     (whether  before or after the  Closing  Date).  All  amounts due under this
     Section  11.05  shall be payable  within  ten  Business  Days after  demand
     therefor.  The agreements in this Section shall survive the  resignation of
     the Administrative Agent, the replacement of any Lender, the termination of
     the Aggregate  Commitments and the repayment,  satisfaction or discharge of
     all the other Obligations.

     11.06 Payments Set Aside.

     To the extent that any  payment by or on behalf of the  Borrower is made to
     the Administrative  Agent or any Lender, or the Administrative Agent or any
     Lender exercises its right of set-off,  and such payment or the proceeds of
     such set-off or any part thereof (or the Dollar  Equivalent amount thereof)
     is subsequently invalidated, declared to be fraudulent or preferential, set
     aside or required (including pursuant to any settlement entered into by the
     Administrative  Agent or such Lender in its  discretion)  to be repaid to a
     trustee,  receiver or any other party,  in connection  with any  proceeding
     under any Debtor  Relief Law or  otherwise,  then (a) to the extent of such
     recovery,  the  obligation  or  part  thereof  originally  intended  to  be
     satisfied  shall be revived  and  continued  in full force and effect as if
     such  payment had not been made or such set-off had not  occurred,  and (b)
     each Lender severally agrees to pay to the Administrative Agent upon demand
     its  applicable  share  of any  amount  so  recovered  from  or paid by the
     Administrative Agent, plus interest thereon from the date of such demand to
     the date  such  payment  is made at a rate per annum  equal to the  Federal
     Funds Rate from time to time in effect, in the applicable  currency of such
     recovery or payment.

     11.07 Successors and Assigns.

     (a) The provisions of this Agreement shall be binding upon and inure to the
     benefit of the parties hereto and their  respective  successors and assigns
     permitted  hereby,

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     except that the Borrower  may not assign or  otherwise  transfer any of its
     rights or obligations  hereunder  without the prior written consent of each
     Lender and no Lender may assign or otherwise  transfer any of its rights or
     obligations hereunder except (i) to an Eligible Assignee in accordance with
     the  provisions  of  subsection  (b)  of  this  Section,  (ii)  by  way  of
     participation  in accordance  with the provisions of subsection (d) of this
     Section  or (iii) by way of pledge or  assignment  of a  security  interest
     subject to the  restrictions  of  subsection  (f) of this  Section (and any
     other  attempted  assignment  or transfer by any party hereto shall be null
     and void).  Nothing  in this  Agreement,  expressed  or  implied,  shall be
     construed to confer upon any Person (other than the parties  hereto,  their
     respective  successors and assigns  permitted  hereby,  Participants to the
     extent  provided  in  subsection  (d) of this  Section  and,  to the extent
     expressly  contemplated  hereby,  the  Indemnitees)  any legal or equitable
     right, remedy or claim under or by reason of this Agreement.

     (b) Any Lender may at any time assign to one or more Eligible Assignees all
     or a portion of its rights and obligations under this Agreement  (including
     all or a portion of its Commitment and the Loans (including for purposes of
     this  subsection (b),  participations  in L/C Obligations and in Swing Line
     Loans) at the time owing to it); provided that (i) except in the case of an
     assignment  of  the  entire  remaining  amount  of the  assigning  Lender's
     Commitment  and the  Loans  at the  time  owing  to it or in the case of an
     assignment  to a Lender or an Affiliate of a Lender or an Approved Fund (as
     defined in subsection  (g) of this  Section) with respect to a Lender,  the
     aggregate  amount of the Commitment  (which for this purpose includes Loans
     outstanding  thereunder) subject to each such assignment,  determined as of
     the date the Assignment and Assumption  with respect to such  assignment is
     delivered to the  Administrative  Agent or, if "Trade Date" is specified in
     the Assignment and Assumption, as of the Trade Date, shall not be less than
     $5,000,000 unless each of the Administrative Agent and, so long as no Event
     of Default has occurred and is continuing,  the Borrower otherwise consents
     (each such consent not to be unreasonably  withheld or delayed);  (ii) each
     partial  assignment shall be made as an assignment of a proportionate  part
     of all the assigning  Lender's rights and obligations  under this Agreement
     with  respect to the Loans or the  Commitment  assigned,  except  that this
     clause (ii) shall not apply to rights in respect of Swing Line Loans; (iii)
     any  assignment  of a  Commitment  must be approved  by the  Administrative
     Agent,  the L/C Issuer and the Swing Line Lender  unless the Person that is
     the  proposed  assignee  is itself a Lender  (whether  or not the  proposed
     assignee would  otherwise  qualify as an Eligible  Assignee);  and (iv) the
     parties to each assignment shall execute and deliver to the  Administrative
     Agent  an  Assignment  and  Assumption,  together  with  a  processing  and
     recordation  fee  payable by the  Assignor  (or as  otherwise  provided  in
     Section  11.16  hereof) of  $3,500.  Subject to  acceptance  and  recording
     thereof by the  Administrative  Agent  pursuant to  subsection  (c) of this
     Section, from and after the effective date specified in each Assignment and
     Assumption,  the  Eligible  Assignee  thereunder  shall  be a party to this
     Agreement  and, to the extent of the interest  assigned by such  Assignment
     and  Assumption,  have the rights and  obligations  of a Lender  under this
     Agreement,  and the assigning Lender thereunder shall, to the extent of the
     interest  assigned by such Assignment and Assumption,  be released from its
     obligations  under this  Agreement  (and, in the case of an Assignment

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     and  Assumption   covering  all  of  the  assigning   Lender's  rights  and
     obligations  under this  Agreement,  such Lender  shall cease to be a party
     hereto but shall  continue to be entitled to the benefits of Sections 3.01,
     3.04,  3.05,  11.04  and 11.05  with  respect  to facts  and  circumstances
     occurring  prior to the effective date of such  assignment).  Upon request,
     the  Borrower  (at its  expense)  shall  execute  and deliver a Note to the
     assignee  Lender.  Any  assignment  or  transfer  by a Lender  of rights or
     obligations  under this Agreement that does not comply with this subsection
     shall be treated for purposes of this Agreement as a sale by such Lender of
     a  participation   in  such  rights  and  obligations  in  accordance  with
     subsection (d) of this Section.

     (c) The Administrative Agent, acting solely for this purpose as an agent of
     the Borrower, shall maintain at the Administrative Agent's Office a copy of
     each  Assignment  and  Assumption  delivered  to it and a register  for the
     recordation of the names and addresses of the Lenders,  and the Commitments
     of, and principal  amounts of the Loans and L/C Obligations  owing to, each
     Lender pursuant to the terms hereof from time to time (the "Register"). The
     entries  in the  Register  shall  be  conclusive,  and  the  Borrower,  the
     Administrative  Agent and the Lenders  may treat each Person  whose name is
     recorded in the Register pursuant to the terms hereof as a Lender hereunder
     for all purposes of this Agreement, notwithstanding notice to the contrary.
     The Register  shall be  available  for  inspection  by the Borrower and any
     Lender,  at any reasonable time and from time to time upon reasonable prior
     notice.

     (d) Any Lender may at any time,  without  the consent of, or notice to, the
     Borrower or the  Administrative  Agent,  sell  participations to any Person
     (other  than a natural  person  or the  Borrower  or any of the  Borrower's
     Affiliates or Subsidiaries)  (each, a "Participant") in all or a portion of
     such Lender's rights and/or obligations under this Agreement (including all
     or a portion of its Commitment  and/or the Loans  (including  such Lender's
     participations  in L/C  Obligations  and/or Swing Line Loans) owing to it);
     provided  that (i) such Lender's  obligations  under this  Agreement  shall
     remain unchanged,  (ii) such Lender shall remain solely  responsible to the
     other parties hereto for the performance of such  obligations and (iii) the
     Borrower,  the Administrative Agent and the other Lenders shall continue to
     deal solely and directly with such Lender in connection  with such Lender's
     rights and obligations  under this  Agreement.  Any agreement or instrument
     pursuant to which a Lender sells such a  participation  shall  provide that
     such Lender shall retain the sole right to enforce  this  Agreement  and to
     approve any  amendment,  modification  or waiver of any  provision  of this
     Agreement; provided that such agreement or instrument may provide that such
     Lender  will not,  without  the  consent of the  Participant,  agree to any
     amendment,  waiver or other modification  described in the first proviso to
     Section 11.01 that directly affects such Participant. Subject to subsection
     (e) of this Section,  the Borrower  agrees that each  Participant  shall be
     entitled to the benefits of Sections 3.01, 3.04 and 3.05 to the same extent
     as if it were a Lender and had acquired its interest by assignment pursuant
     to  subsection  (b) of this Section.  To the extent  permitted by law, each
     Participant  also shall be  entitled to the  benefits  of Section  11.09 as
     though it were a Lender,  provided such Participant agrees to be subject to
     Section 2.13 as though it were a Lender.

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     (e) A  Participant  shall not be entitled  to receive  any greater  payment
     under  Section  3.01 or 3.04 than the  applicable  Lender  would  have been
     entitled  to  receive  with  respect  to the  participation  sold  to  such
     Participant.  A  Participant  that  would be a Foreign  Lender if it were a
     Lender  shall not be  entitled to the  benefits of Section  3.01 unless the
     Borrower is notified of the participation sold to such Participant and such
     Participant agrees, for the benefit of the Borrower, to comply with Section
     11.15 as though it were a Lender.

     (f) Any Lender may at any time pledge or assign a security  interest in all
     or any  portion of its rights  under this  Agreement  (including  under its
     Note, if any) to secure obligations of such Lender, including any pledge or
     assignment to secure  obligations to a Federal Reserve Bank;  provided that
     no such  pledge or  assignment  shall  release  such Lender from any of its
     obligations  hereunder or substitute  any such pledgee or assignee for such
     Lender as a party hereto.

     (g) At the  time of each  assignment  pursuant  to  Section  11.07(b)  to a
     Foreign Lender that is not already a Lender  hereunder,  the assignee shall
     provide to the Administrative Agent and to the Borrower certification as to
     exemption for deduction or withholding of Taxes in accordance  with Section
     11.15 and shall be subject to the provisions thereof.

     (h)  Notwithstanding  anything to the contrary  contained herein, if at any
     time Bank of America  assigns all of its  Commitment  and Loans pursuant to
     subsection (b) above,  Bank of America may, (i) upon thirty days' notice to
     the Borrower and the Lenders,  resign as L/C Issuer and/or (ii) upon thirty
     days' notice to the Borrower,  resign as Swing Line Lender. In the event of
     any such resignation as L/C Issuer or Swing Line Lender, the Borrower shall
     be  entitled to appoint  from among the  Lenders a successor  L/C Issuer or
     Swing Line  Lender  hereunder;  provided,  however,  that no failure by the
     Borrower to appoint any such successor shall affect the resignation of Bank
     of America as L/C Issuer or Swing Line Lender,  as the case may be. If Bank
     of  America  resigns  as L/C  Issuer,  it shall  retain  all the rights and
     obligations  of the L/C Issuer  hereunder  with  respect to all  Letters of
     Credit  outstanding  as of the  effective  date of its  resignation  as L/C
     Issuer and all L/C Obligations with respect thereto (including the right to
     require the Lenders to make Base Rate Loans or fund risk  participations in
     Unreimbursed  Amounts  pursuant  to  Section  2.03(c)).  If Bank of America
     resigns as Swing Line  Lender,  it shall retain all the rights of the Swing
     Line Lender provided for hereunder with respect to Swing Line Loans made by
     it and outstanding as of the effective date of such resignation,  including
     the right to  require  the  Lenders  to make  Base Rate  Loans or fund risk
     participations in outstanding Swing Line Loans pursuant to Section 2.04(c).

     11.08 Confidentiality.

     Each of the  Administrative  Agent and the Lenders  agrees to maintain  the
     confidentiality  of  the  Information  (as  defined  below),   except  that
     Information  may be  disclosed  (a) to its and its  Affiliates'  directors,
     officers,  employees and agents,  including accountants,  legal counsel and
     other  advisors  (it  being  understood  that  the  Persons  to  whom  such
     disclosure  is made will be  informed  of the  confidential  nature of such
     Information and

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     instructed  to  keep  such  Information  confidential);  (b) to the  extent
     requested  by any  regulatory  authority;  (c) to the  extent  required  by
     applicable laws or regulations or by any subpoena or similar legal process;
     (d) to any  other  party  to this  Agreement;  (e) in  connection  with the
     exercise  of any  remedies  hereunder  or any suit,  action  or  proceeding
     relating to this  Agreement or the  enforcement  of rights  hereunder;  (f)
     subject to an agreement  containing  provisions  substantially  the same as
     those of this Section,  to (i) any Eligible  Assignee of or Participant in,
     or any  prospective  Eligible  Assignee  of or  Participant  in, any of its
     rights or  obligations  under this Agreement or (ii) any direct or indirect
     contractual  counterparty or prospective  counterparty (or such contractual
     counterparty's or prospective  counterparty's  professional advisor) to any
     credit derivative  transaction relating to obligations of the Loan Parties;
     (g) with the consent of the  Borrower;  (h) to the extent such  Information
     (i) becomes  publicly  available other than as a result of a breach of this
     Section or (ii) becomes available to the Administrative Agent or any Lender
     on a nonconfidential basis from a source other than the Borrower; or (i) to
     the National  Association of Insurance  Commissioners  or any other similar
     organization  or any  nationally  recognized  rating  agency that  requires
     access  to  information  about a  Lender's  or its  Affiliates'  investment
     portfolio in connection  with ratings issued with respect to such Lender or
     its Affiliates.  In addition,  the Administrative Agent and the Lenders may
     disclose  the  existence  of this  Agreement  and  information  about  this
     Agreement  to market data  collectors,  similar  service  providers  to the
     lending industry, and service providers to the Administrative Agent and the
     Lenders  in  connection  with the  administration  and  management  of this
     Agreement,  the other  Loan  Documents,  the  Commitments,  and the  Credit
     Extensions.  For the  purposes  of this  Section,  "Information"  means all
     information  received from any Loan Party relating to any Loan Party or its
     business,  other  than  any  such  information  that  is  available  to the
     Administrative  Agent or any  Lender on a  nonconfidential  basis  prior to
     disclosure by any Loan Party;  provided  that,  in the case of  information
     received  from a Loan Party  after the date  hereof,  such  information  is
     clearly identified in writing at the time of delivery as confidential.  Any
     Person required to maintain the  confidentiality of Information as provided
     in this Section shall be considered to have complied with its obligation to
     do so if such Person has  exercised the same degree of care to maintain the
     confidentiality  of such Information as such Person would accord to its own
     confidential information.

     11.09 Set-off.

     In addition to any rights and remedies of the Lenders provided by law, upon
     the  occurrence and during the  continuance  of any Event of Default,  each
     Lender and any  Affiliate of any Lender is  authorized at any time and from
     time to time, without prior notice to the Borrower or any other Loan Party,
     any such  notice  being  waived by the  Borrower  (on its own behalf and on
     behalf of each Loan Party) to the fullest  extent  permitted by law, to set
     off and apply any and all  deposits  (general or  special,  time or demand,
     provisional  or final) at any time held by, and other  indebtedness  at any
     time  owing by,  such  Lender to or for the  credit or the  account  of the
     respective  Loan  Parties  against  any and all  Obligations  owing to such
     Lender  hereunder  or under  any  other  Loan  Document,  now or  hereafter
     existing,  irrespective of whether or not the

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     Administrative  Agent or such  Lender  shall  have made  demand  under this
     Agreement or any other Loan Document and although such  Obligations  may be
     contingent or unmatured or denominated in a currency different from that of
     the  applicable  deposit or  indebtedness.  Each Lender agrees  promptly to
     notify the Borrower and the Administrative Agent after any such set-off and
     application  made by such Lender;  provided,  however,  that the failure to
     give  such  notice  shall not  affect  the  validity  of such  set-off  and
     application.

     11.10 Interest Rate Limitation.

     Notwithstanding  anything to the contrary  contained in any Loan  Document,
     the interest paid or agreed to be paid under the Loan  Documents  shall not
     exceed the maximum rate of  non-usurious  interest  permitted by applicable
     Law (the "Maximum Rate"). If the  Administrative  Agent or any Lender shall
     receive  interest in an amount that  exceeds the Maximum  Rate,  the excess
     interest  shall be applied to the  principal of the Loans or, if it exceeds
     such unpaid principal, refunded to the Borrower. In determining whether the
     interest contracted for, charged,  or received by the Administrative  Agent
     or a Lender  exceeds  the  Maximum  Rate,  such  Person  may, to the extent
     permitted  by  applicable  Law,  (a)  characterize  any payment that is not
     principal as an expense, fee, or premium rather than interest,  (b) exclude
     voluntary  prepayments and the effects thereof, and (c) amortize,  prorate,
     allocate, and spread in equal or unequal parts the total amount of interest
     throughout the contemplated term of the Obligations hereunder.

     11.11 Counterparts.

     This Agreement may be executed in one or more  counterparts,  each of which
     shall be deemed an original, but all of which together shall constitute one
     and the same instrument.

     11.12 Integration.

     This  Agreement,  together  with the other Loan  Documents,  comprises  the
     complete  and  integrated  agreement  of the parties on the subject  matter
     hereof and thereof and supersedes all prior agreements, written or oral, on
     such subject matter. In the event of any conflict between the provisions of
     this Agreement and those of any other Loan Document, the provisions of this
     Agreement shall control; provided that the inclusion of supplemental rights
     or  remedies  in favor of the  Administrative  Agent or the  Lenders in any
     other Loan  Document  shall not be deemed a conflict  with this  Agreement.
     Each  Loan  Document  was  drafted  with  the  joint  participation  of the
     respective  parties  thereto and shall be construed  neither against nor in
     favor of any party, but rather in accordance with the fair meaning thereof.

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     11.13 Survival of Representations and Warranties.

     All  representations  and  warranties  made hereunder and in any other Loan
     Document  or other  document  delivered  pursuant  hereto or  thereto or in
     connection  herewith or therewith  shall survive the execution and delivery
     hereof and thereof.  Such  representations and warranties have been or will
     be relied upon by the Administrative  Agent and each Lender,  regardless of
     any  investigation  made by the  Administrative  Agent or any  Lender or on
     their  behalf  and  notwithstanding  that the  Administrative  Agent or any
     Lender may have had notice or  knowledge  of any Default at the time of any
     Credit  Extension,  and shall  continue in full force and effect as long as
     any  Loan  or  any  other  Obligation  hereunder  shall  remain  unpaid  or
     unsatisfied or any Letter of Credit shall remain outstanding.

     11.14 Severability.

     If any provision of this  Agreement or the other Loan  Documents is held to
     be  illegal,  invalid or  unenforceable,  (a) the  legality,  validity  and
     enforceability of the remaining  provisions of this Agreement and the other
     Loan  Documents  shall not be  affected  or  impaired  thereby  and (b) the
     parties shall endeavor in good faith  negotiations  to replace the illegal,
     invalid or  unenforceable  provisions  with valid  provisions  the economic
     effect of which comes as close as possible to that of the illegal,  invalid
     or unenforceable provisions.  The invalidity of a provision in a particular
     jurisdiction shall not invalidate or render unenforceable such provision in
     any other jurisdiction.

     11.15 Tax Forms.

     (a) (i) Each Lender that is not a "United States person" within the meaning
     of Section  7701(a)(30) of the Internal  Revenue Code (a "Foreign  Lender")
     shall deliver to the Administrative Agent and to the Borrower,  on or prior
     to the  date of its  execution  and  delivery  of this  Agreement  (or upon
     accepting an assignment of an interest  herein),  two duly signed completed
     copies of either IRS Form W-8BEN or any successor thereto (relating to such
     Foreign Lender and entitling it to an exemption from withholding tax on all
     payments to be made to such Foreign Lender by the Borrower pursuant to this
     Agreement)  or IRS Form W-8ECI or any  successor  thereto  (relating to all
     payments to be made to such Foreign Lender by the Borrower pursuant to this
     Agreement)  or such other  evidence  satisfactory  to the  Borrower and the
     Administrative  Agent that such Foreign  Lender is entitled to an exemption
     from U.S.  withholding  tax,  including any exemption  pursuant to Sections
     871(h) and 881(c) of the Internal Revenue Code. Thereafter and from time to
     time,   each  such  Foreign  Lender  shall  (A)  promptly   submit  to  the
     Administrative Agent and to the Borrower such additional duly completed and
     signed  copies of one of such  forms (or such  successor  forms as shall be
     adopted from time to time by the relevant United States taxing authorities)
     as may  then be  available  under  then  current  United  States  laws  and
     regulations to avoid,  or such evidence as is  satisfactory to the Borrower
     and the Administrative  Agent of any available exemption from United States
     withholding  taxes in respect of all  payments  to be made to such

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     Foreign  Lender by the Borrower  pursuant to this  Agreement,  (B) promptly
     notify  the  Administrative  Agent  and  the  Borrower  of  any  change  in
     circumstances  that would modify or render  invalid any claimed  exemption,
     and (C) take such steps as shall not be materially  disadvantageous  to it,
     in the  good  faith  judgment  of  such  Lender,  and as may be  reasonably
     requested in writing by the Borrower  (including  filing any certificate or
     document  or the  re-designation  of  its  Lending  Office)  to  avoid  any
     requirement  of  applicable  Laws that the Borrower  make any  deduction or
     withholding  for taxes from amounts  payable to such  Foreign  Lender or to
     reduce the amount of any such  deduction  or  withholding  to the  greatest
     extent possible.

     (ii) Each  Foreign  Lender,  to the extent it does not act or ceases to act
     for its own account with respect to any portion of any sums paid or payable
     to such Lender under any of the Loan Documents (for example, in the case of
     a  typical   participation   by  such   Lender),   shall   deliver  to  the
     Administrative  Agent and to the  Borrower  on the date  when such  Foreign
     Lender ceases to act for its own account with respect to any portion of any
     such sums paid or payable,  and at such other times as may be  necessary in
     the  determination  of the  Administrative  Agent or the  Borrower  (in the
     reasonable  exercise of their respective  discretion),  (A) two duly signed
     completed copies of the forms or statements required to be provided by such
     Lender as set forth above,  to establish  the portion of any such sums paid
     or payable  with respect to which such Lender acts for its own account that
     is not subject to U.S.  withholding  tax, and (B) two duly signed completed
     copies of IRS Form W-8IMY (or any  successor  thereto),  together  with any
     information  such Lender  chooses to transmit with such form, and any other
     certificate or statement of exemption  required under the Internal  Revenue
     Code, to establish  that such Lender is not acting for its own account with
     respect to a portion of any such sums payable to such Lender.

     (iii)  Notwithstanding any other provision of this Agreement,  the Borrower
     shall not be required to pay any additional  amount or  indemnification  to
     any  Foreign  Lender  under  Section  3.01 (A) with  respect  to any  Taxes
     required  to be  deducted  or  withheld  on the  basis of the  information,
     certificates  or statements of exemption such Lender  transmits with an IRS
     Form W-8IMY  pursuant to this Section  11.15(a) or (B) if such Lender shall
     have failed to satisfy the foregoing  provisions of this Section  11.15(a);
     provided that if such Lender shall have satisfied the  requirements of this
     Section  11.15(a) on the date such Lender  became a Lender or ceased to act
     for its own  account  with  respect  to any  payment  under any of the Loan
     Documents,  nothing in this Section  11.15(a) shall relieve the Borrower of
     its  obligation  to pay any amounts  pursuant to Section  3.01 in the event
     that,  as a  result  of  any  change  in  any  applicable  law,  treaty  or
     governmental  rule,  regulation or order such Lender is no longer  properly
     entitled to deliver forms,  certificates  or other evidence at a subsequent
     date establishing the fact that such Lender or other Person for the account
     of which  such  Lender  receives  any sums  payable  under  any of the Loan
     Documents is not subject to  withholding  or is subject to withholding at a
     reduced rate.

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     (iv) The Administrative  Agent may, without  reduction,  withhold any Taxes
     required to be deducted and withheld from any payment under any of the Loan
     Documents  with  respect  to which  the  Borrower  is not  required  to pay
     additional amounts under this Section 11.15(a).

     (b) Upon the  request of the  Administrative  Agent,  each Lender that is a
     "United  States  person"  within the meaning of Section  7701(a)(30) of the
     Internal  Revenue Code shall deliver to the  Administrative  Agent two duly
     signed  completed  copies of IRS Form W-9. If such Lender  fails to deliver
     such forms,  then the  Administrative  Agent may withhold from any interest
     payment  to such  Lender an amount  equivalent  to the  applicable  back-up
     withholding tax imposed by the Internal  Revenue Code,  without  reduction.
     The Borrower  shall have no liability  under Section 3.01 or otherwise with
     respect to amounts  withheld by the  Administrative  Agent pursuant to this
     Section 11.15(b).

     (c) If any Governmental Authority asserts that the Administrative Agent did
     not properly  withhold or backup  withhold,  as the case may be, any tax or
     other amount from payments  made to or for the account of any Lender,  such
     Lender shall indemnify the  Administrative  Agent  therefor,  including all
     penalties  and  interest,  any taxes  imposed  by any  jurisdiction  on the
     amounts payable to the Administrative  Agent under this Section,  and costs
     and expenses  (including  Attorney Costs) of the Administrative  Agent. The
     obligation of the Lenders under this Section shall survive the  termination
     of the Aggregate Commitments,  repayment of all other Obligations hereunder
     and the resignation of the Administrative Agent.

     11.16 Replacement of Lenders.

     Under any  circumstances set forth herein providing that the Borrower shall
     have  the  right to  replace  a Lender  as a party to this  Agreement,  the
     Borrower  may,  upon  notice to such Lender and the  Administrative  Agent,
     replace such Lender by causing such Lender to assign its  Commitment  (with
     the assignment fee to be paid by the Borrower in such instance) pursuant to
     Section  11.07(b)  to one or  more  other  Lenders  or  Eligible  Assignees
     procured by the Borrower; provided, however, that if the Borrower elects to
     exercise  such right with respect to any Lender  pursuant to Section  1.09,
     Section  3.02 or Section  3.06(b),  it shall be  obligated  to replace  all
     similarly  situated  Lenders.  The  Borrower  shall  (x)  pay in  full  all
     principal,  interest,  fees and other amounts owing to such Lender  through
     the date of replacement  (including any amounts payable pursuant to Section
     3.05),  (y)  provide  appropriate  assurances  and  indemnities  (which may
     include  letters of credit) to the L/C Issuer and the Swing Line  Lender as
     each may reasonably  require with respect to any  continuing  obligation to
     fund participation interests in any L/C Obligations or any Swing Line Loans
     then  outstanding,  and (z) release such Lender from its obligations  under
     the Loan Documents.  Any Lender being replaced shall execute and deliver an
     Assignment  and  Assumption  with respect to such Lender's  Commitment  and
     outstanding  Loans and  participations  in L/C  Obligations  and Swing Line
     Loans;  provided that the processing and recordation fee in connection with
     such Assignment and Assumption shall be paid by the Borrower.

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     11.17 Source of Funds.

     Each of the Lenders hereby  represents and warrants to the Borrower that at
     least one of the following  statements is an accurate  representation as to
     the  source  of  funds to be used by such  Lender  in  connection  with the
     financing hereunder:

     (a) no part of such funds  constitutes  assets  allocated  to any  separate
     account  maintained  by such Lender in which any employee  benefit plan (or
     its related trust) has any interest;

     (b) to the extent that any part of such funds constitutes  assets allocated
     to any  separate  account  maintained  by  such  Lender,  such  Lender  has
     disclosed  to the  Borrower  the name of each  employee  benefit plan whose
     assets in such account exceed 10% of the total assets of such account as of
     the date of such purchase  (and, for purposes of this  subsection  (b), all
     employee  benefit  plans  maintained  by  the  same  employer  or  employee
     organization are deemed to be a single plan);

     (c) to the  extent  that any part of such  funds  constitutes  assets of an
     insurance  company's  general account,  such insurance company has complied
     with  all of the  requirements  of the  regulations  issued  under  Section
     401(c)(1)(A) of ERISA; or

     (d) such funds constitute assets of one or more specific benefit plans that
     such Lender has identified in writing to the Borrower.

     As used in this  Section  11.17,  the  terms  "employee  benefit  plan" and
     "separate account" shall have the respective meanings provided in Section 3
     of ERISA.

     11.18 Governing Law.

     (a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE  WITH,
     the LAW OF THE STATE OF NEW YORK  applicable to  agreements  made and to be
     performed  entirely  within such State;  PROVIDED  THAT THE  ADMINISTRATIVE
     Agent AND EACH LENDER SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.

     (b) ANY LEGAL ACTION OR  PROCEEDING  WITH RESPECT TO THIS  AGREEMENT OR ANY
     OTHER LOAN  DOCUMENT  MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK
     SITTING IN NEW YORK CITY OR OF THE UNITED STATES FOR THE SOUTHERN  DISTRICT
     OF SUCH  STATE,  AND BY  EXECUTION  AND  DELIVERY  OF THIS  AGREEMENT,  THE
     BORROWER, THE ADMINISTRATIVE Agent AND EACH LENDER CONSENTS, FOR ITSELF AND
     IN RESPECT OF ITS  PROPERTY,  TO THE  NON-EXCLUSIVE  JURISDICTION  OF

                                      103
 Page 165

     THOSE  COURTS.  THE  BORROWER,  THE  ADMINISTRATIVE  Agent AND EACH  LENDER
     IRREVOCABLY WAIVES ANY OBJECTION,  INCLUDING ANY OBJECTION TO THE LAYING OF
     VENUE OR BASED ON THE GROUNDS OF FORUM NON  CONVENIENS,  THAT IT MAY NOW OR
     HEREAFTER  HAVE  TO THE  BRINGING  OF ANY  ACTION  OR  PROCEEDING  IN  SUCH
     JURISDICTION  IN RESPECT OF ANY LOAN  DOCUMENT  OR OTHER  DOCUMENT  RELATED
     THERETO.  THE  BORROWER,  THE  ADMINISTRATIVE  Agent AND EACH LENDER WAIVES
     PERSONAL  SERVICE OF ANY SUMMONS,  COMPLAINT OR OTHER PROCESS,  THAT MAY BE
     MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE.

     11.19 Waiver of Right to Trial by Jury.

     EACH PARTY TO THIS AGREEMENT  HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY
     JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY LOAN
     DOCUMENT  OR IN ANY WAY  CONNECTED  WITH OR  RELATED OR  INCIDENTAL  TO THE
     DEALINGS  OF THE  PARTIES  HERETO OR ANY OF THEM WITH  RESPECT  TO ANY LOAN
     DOCUMENT,  OR THE TRANSACTIONS  RELATED  THERETO,  IN EACH CASE WHETHER NOW
     EXISTING OR HEREAFTER  ARISING,  AND WHETHER FOUNDED IN CONTRACT OR TORT OR
     OTHERWISE;  AND EACH PARTY HEREBY  AGREES AND CONSENTS THAT ANY SUCH CLAIM,
     DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A
     JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART
     OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT
     OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

     11.20 Judgment Currency.

     If, for the purposes of obtaining judgment in any court, it is necessary to
     convert a sum due hereunder or any other Loan Document in one currency into
     another  currency,  the  rate of  exchange  used  shall be that at which in
     accordance with normal banking  procedures the  Administrative  Agent could
     purchase the first  currency  with such other  currency on the Business Day
     preceding  that on which final  judgment is given.  The  obligation  of the
     Borrower  in  respect  of any such sum due from them to the  Administrative
     Agent or the Lenders  hereunder  or under the other Loan  Documents  shall,
     notwithstanding any judgment in a currency (the "Judgment  Currency") other
     than  that  in  which  such  sum is  denominated  in  accordance  with  the
     applicable  provisions of this Agreement  (the  "Agreement  Currency"),  be
     discharged only to the extent that on the Business Day following receipt by
     the  Administrative  Agent of any sum adjudged to be so due in the Judgment
     Currency,  the  Administrative  Agent may in accordance with normal banking
     procedures  purchase the Agreement Currency with the Judgment Currency.  If
     the amount of the  Agreement  Currency  so  purchased  is less than the sum
     originally  due  to the  Administrative  Agent  from  the  Borrower  in the
     Agreement  Currency,  the Borrower  agrees,  as a separate  obligation  and
     notwithstanding any such judgment, to indemnify the Administrative Agent or
     the Person to whom such  obligation

                                      104
 Page 166

     was owing  against such loss.  If the amount of the  Agreement  Currency so
     purchased  is greater  than the sum  originally  due to the  Administrative
     Agent in such  currency,  the  Administrative  Agent  agrees to return  the
     amount of any  excess to the  Borrower  (or to any other  Person who may be
     entitled thereto under applicable law).

                            [SIGNATURE PAGES FOLLOW]

                                      105
 Page 167

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


     BORROWER:                            ALBEMARLE CORPORATION,
                                          a Virginia corporation

                                          By:___________________
                                          Name:
                                          Title:


     GUARANTORS:                         [NONE AS OF THE CLOSING DATE]



     ADMINISTRATIVE AGENT:                BANK OF AMERICA, n.a.,
                                          as Administrative Agent

                                          By:___________________
                                          Name:
                                          Title:


     LENDERS:                             BANK OF  AMERICA,  n.a.,
                                          as a Lender,  L/C Issuer
                                          and Swing Line Lender

                                          By:___________________
                                          Name:
                                          Title:

                                          FORTIS (USA) FINANCE LLC

                                          By:___________________
                                          Name:
                                          Title:

                                          THE BANK OF NEW YORK

                                          By:___________________
                                          Name:
                                          Title:

                                          SUNTRUST BANK

                                          By:___________________
                                          Name:
                                          Title:


 Page 168


                                          BANK ONE, NA
                                          (Main Office, Chicago)

                                          By:___________________
                                          Name:
                                          Title:

                                          BANK OF CHINA, NEW YORK BRANCH
                                          By:___________________
                                          Name:
                                          Title:

                                          SUMITOMO MITSUI BANKING CORPORATION

                                          By:___________________
                                          Name:
                                          Title:

                                          NATIONAL CITY BANK

                                          By:___________________
                                          Name:
                                          Title:

                                          THE NORINCHUKIN BANK, NEW YORK BRANCH

                                          By:___________________
                                          Name:
                                          Title:

                                          WHITNEY NATIONAL BANK

                                          By:___________________
                                          Name:
                                          Title:

                                          MERRILL LYNCH BUSINESS
                                          FINANCIAL SERVICES INC.

                                          By:___________________
                                          Name:
                                          Title:


 Page 169



                                    SCHEDULES
                                    ---------


         1.01     Mandatory Cost Rate
         2.01     Commitments and Pro Rata Shares
         2.03     Existing Letters of Credit
         6.09     Environmental Matters
         8.01     Existing Liens
         11.02    Eurocurrency and Domestic Lending Offices; Notice Addresses


                                    EXHIBITS
                                    --------

         A        Form of Committed Loan Notice
         B        Form of Swing Line Loan Notice
         C        Form of Note
         D        Form of Compliance Certificate
         E        Form of Assignment and Assumption
         G        Form of Joinder Agreement
         H        Form of Lender Joinder Agreement

  Page 170


                                  Schedule 1.01

                               MANDATORY COST RATE

     For the  purposes  of this  Schedule:  "Act"  means the Bank of England Act
     1998.

     "Eligible  Liabilities" has the meaning specified pursuant to the Act or by
     the Bank of England (as may be appropriate),  on the day of the application
     of the formula.  "Fee Base" has the meaning  specified for the purposes of,
     and shall be calculated in accordance  with,  the Fees  Regulations.  "Fees
     Regulations" means, as appropriate, either:

     (a) the Banking Supervision (Fees) Regulations 1999; or

     (b) such  other  law or  regulations  as from time to time may be in force,
     relating to the payment of fees for banking supervision.

     "FSA" means the Financial Services Authority.

     "Special  Deposits" has the meaning specified pursuant to the Act or by the
     Bank of England (as may be  appropriate),  on the day of the application of
     the formula.

     The Mandatory Cost Rate will be the percentage rate per annum determined by
     the  Administrative  Agent (rounded upward,  if necessary,  to four decimal
     places) as the rate resulting from the application (as  appropriate) of the
     following  formulae:  (a) in  relation  to Loans or  other  unpaid  amounts
     denominated in British Pounds Sterling:

                            XL + S(L - D) + F x 0.01
                            ------------------------
                                  100 - (X + S)

     (b) in  relation  to Loans  or  other  unpaid  amounts  denominated  in any
     currency other than British Pounds  Sterling:

                                    F x 0.01
                                    --------
                                       300

     where, in each case, on the day of application of such formula:

     "X" is the  percentage  of  Eligible  Liabilities  (in excess of any stated
     minimum) by  reference  to which the  Mandatory  Cost  Reference  Lender is
     required  under or pursuant to the Act to maintain cash ratio deposits with
     the Bank of England;  "L" is the Adjusted  Eurocurrency  Rate applicable to
     such  Loan;  "F" is the  rate of  charge  payable  by such  Mandatory  Cost
     Reference  Lender to the FSA  pursuant to  paragraphs  2.02 or 2.03 (as the
     case may be) of the Fees  Regulations  (but for this  purpose the figure at
     paragraph  2.02b or 2.03b  (as the case may be) shall be deemed to be zero)
     and  expressed  in  pounds  per  (pound)1  million  of the Fee  Base of the
     Mandatory  Cost  Reference  Lender;  "S" is the  level of  interest-bearing
     Special Deposits,  expressed as a percentage of Eligible Liabilities,  that
     such Mandatory Cost Reference Lender is required to maintain by the Bank of
     England (or other United Kingdom governmental authorities or agencies); and
     "D" is the percentage  rate per annum payable by the Bank of England to the
     Mandatory Cost Reference Lender on Special Deposits.

 Page 171

     ("X," "L," "S" and "D" are to be  expressed  in the  formula as numbers and
     not as percentages.  A negative  result obtained from  subtracting "D" from
     "L" shall be counted as zero.)

     The Mandatory  Cost Rate for any Interest  Period shall be calculated at or
     about 11:00 a.m. (London time) on the first day of such Interest Period for
     the duration of such Interest  Period.  The  determination of the Mandatory
     Cost Rate in  relation  to any  Interest  Period  shall,  in the absence of
     manifest error,  be conclusive and binding on all parties hereto.  If there
     is any change in  circumstance  (including the imposition of alternative or
     additional  requirements,  including capital adequacy requirements) that in
     the reasonable opinion of the  Administrative  Agent renders or will render
     the above  formulae  (or any  element  thereof,  or any  defined  term used
     therein)  inappropriate or  inapplicable,  the  Administrative  Agent shall
     promptly  notify  the  Borrower  and the  Lenders  thereof  and  (following
     consultation  with the Required Lenders) shall be entitled to vary the same
     with the prior  written  consent of the  Borrower,  such  consent not to be
     unreasonably withheld. Any such variation shall, in the absence of manifest
     error,  be  conclusive  and binding on all parties and shall apply from the
     date  specified in a notice from the  Administrative  Agent to the Borrower
     and the Lenders.

 Page 172


                                                                                                            
                                                                Schedule 2.01

                                                     COMMITMENTS AND PRO RATA SHARES

------------------------------------------------------------------------------------------------------------------------------------
                                                        Domestic           Domestic          Multicurrency      Multicurrency
                       Lenders                         Commitment       Pro Rata Share         Commitment        Pro Rata Share
------------------------------------------------------------------------------------------------------------------------------------
Bank of America, N.A.                             $40,645,161.29         14.7800587%         $19,354,838.71        19.35483871%
Fortis (USA) Finance LLC                          $40,645,161.29         14.7800587%         $19,354,838.71        19.35483871%
The Bank of New York                              $30,483,870.97         11.0850440%         $14,516,129.03        14.51612903%
SunTrust Bank                                     $30,483,870.97         11.0850440%         $14,516,129.03        14.51612903%
Bank One, NA (Main Office, Chicago)               $23,709,677.42          8.6217009%         $11,290,322.58        11.29032258%
Bank of China, New York Branch                    $35,000,000.00         12.7272727%                     $0                  0%
Sumitomo Mitsui Banking Corporation               $16,935,483.87          6.1583578%          $8,064,516.13         8.06451613%
National City Bank                                $13,548,387.10          4.9266862%          $6,451,612.90         6.45161290%
The Norinchukin Bank, New York Branch             $20,000,000.00          7.2727273%                     $0                  0%
Whitney National Bank                             $13,548,387.10          4.9266862%          $6,451,612.90         6.45161290%
Merrill Lynch Business Financial Services Inc.    $10,000,000.00          3.6363636%                     $0                  0%

------------------------------------------------------------------------------------------------------------------------------------
Total:                                            $275,000,000.00        100.000000000%     $100,000,000.00      100.000000000%
------------------------------------------------------------------------------------------------------------------------------------


 Page 173

                                                             Schedule 11.02

                                                            NOTICE ADDRESSES


                                                                                                  

Party                                       Notice Address                                        Lending Office
-----------------------------------------------------------------------------------------------------------------------------------
                                                                                  (for payments and Requests for Credit Extensions)

BORROWER:                                   ALBEMARLE CORPORATION                                      N/A
                                            330 South Fourth Street
                                            P.O. Box 1335
                                            Richmond, Virginia 23210
                                            Attention:
                                            Telephone:
                                            Facsimile:
                                            Electronic Mail:  _______@_____

                                            With a copy to:
                                            ALBEMARLE CORPORATION
                                            451 Florida Street
                                            Baton Rouge, Louisiana 70801
                                            Attention: Treasurer

 Page 174


GUARANTORS:                                [GUARANTOR]                                                 N/A
                                            c/o Albemarle Corporation
                                            330 South Fourth Street
                                            P.O. Box 1335
                                            Richmond, Virginia 23210
                                            Attention:
                                            Telephone:
                                            Facsimile:
                                            Electronic Mail:  _______@_____

                                            With a copy to:
                                            ALBEMARLE CORPORATION
                                            451 Florida Street
                                            Baton Rouge, Louisiana 70801
                                            Attention: Treasurer

 Page 175

ADMINISTRATIVE AGENT:                       BANK OF AMERICA, N.A.                      BANK OF AMERICA, N.A.
                                            One Independence Center                    One Independence Center
                                            101 North Tryon Street                     101 North Tryon Street
                                            Mail Code:  NC1-001-08-19                  Mail Code:  NC1-001-15-03
                                            Charlotte, North Carolina  28255           Charlotte, North Carolina  28255-0001
                                            Attention:  Barry M. Flynn                 Attention:  Laura A. Schultz, Agency Services
                                            Telephone:  704-387-5450                   Telephone:  704-388-6484
                                            Facsimile:  704-409-0648                   Facsimile:  704-409-0008
                                                                                       Laura.a.schultz@bankofamerica.com
                                            With a copy to:                            Account No.:  1366212250600
                                            BANK OF AMERICA, N.A.                      Ref:  Albemarle Corporation
                                            335 Madison Avenue, 5th Floor              ABA # 053000196
                                            Mail Code: NY1-503-05-13
                                            New York, New York 10017
                                            Attention:  Wendy J. Gorman
                                            Telephone: 212-503-7363
                                            Facsimile: 212-503-7878
                                            Wendy.j.gorman@bankofamerica.com

 Page 176


L/C ISSUER:                                 BANK OF AMERICA, N.A.                      BANK OF AMERICA, N.A.
                                            Trade Operations-Los Angeles #22621        Trade Operations-Los Angeles #22621
                                            333 S. Beaudry Avenue, 19th Floor          333 S. Beaudry Avenue, 19th Floor
                                            Mail Code:  CA9-703-19-23                  Mail Code:  CA9-703-19-23
                                            Los Angeles, CA 90017-1466                 Los Angeles, CA 90017-1466
                                            Attention:  Sandra Leon, Vice President    Attention:  Sandra Leon, Vice President
                                            Telephone:  213.345.5231                   Telephone:  213.345.5231
                                            Facsimile:  213.345.6694                   Facsimile:  213.345.6694
                                            Sandra.Leon@bankofamerica.com              Sandra.Leon@bankofamerica.com

SWING LINE LENDER:                          BANK OF AMERICA, N.A.                      BANK OF AMERICA, N.A.
                                            One Independence Center                    One Independence Center
                                            101 North Tryon Street                     101 North Tryon Street
                                            Mail Code:  NC1-001-15-03                  Mail Code:  NC1-001-15-03
                                            Charlotte, North Carolina  28255-0001      Charlotte, North Carolina  28255-0001
                                            Attention:  Laura A. Schultz,              Attention:  Laura A. Schultz, Agency Services
                                            Agency Services
                                            Telephone:  704-388-6484                   Telephone:  704-388-6484
                                            Facsimile:  704-409-0008                   Facsimile:  704-409-0008
                                            Laura.a.schultz@bankofamerica.com          Laura.a.schultz@bankofamerica.com
                                            Account No.:  1366212250600                Account No.:  1366212250600
                                            Ref:  Albemarle Corporation                Ref:  Albemarle Corporation
                                            ABA # 053000196                            ABA # 053000196
 Page 177

LENDERS:                                    FORTIS (USA) FINANCE LLC                   FORTIS (USA) FINANCE LLC
                                            3 Stamford Plaza                           3 Stamford Plaza
                                            301 Tresser Boulevard, 9th Floor           301 Tresser Boulevard, 9th Floor
                                            Stamford, CT 06901-3239                    Stamford, CT 06901-3239
                                            Attention: Mikko Vaisanen                  Attention:  Elice Tracey/Marlene
                                                                                                   Purrier-Ellis
                                            Telephone:  203-705-5734                   Telephone:  203-705-5778
                                            Facsimile:  203-705-5919                   Facsimile:  203-705-5898
                                            Email: Mikkovaisanen@fortiscapitalusa.com  Email: Elise.Tracey@Fortiscapitalusa.com

                                            THE BANK OF NEW YORK                       THE BANK OF NEW YORK
                                            One Wall Street, 22nd Floor                One Wall Street, 22nd Floor
                                            New York, New York 10005                   New York, New York  10005
                                            Attention:  Steven Cavaluzzo               Attention:  Larry Geter
                                            Telephone:  212-635-1059                   Telephone:  212-635-6340
                                            Facsimile:  212-635-6434                   Facsimile:  212-635-6399
                                            Email:                                     Email:

                                            SUNTRUST BANK                              SUNTRUST BANK
                                            919 East Main Street                       10710 Midlothian Turnpike
                                            Richmond, VA 23219                         Richmond, VA  23235
                                            Attention:  Mark A. Flatin                 Attention:  Bonnie Brown
                                            Telephone:  804-782-5449                   Telephone:  804-594-1061
                                            Facsimile:  804-782-5413                   Facsimile:  804-594-1139
                                            Email: mark.flatin@suntrust.com            Email:
 Page 178

                                            BANK ONE, NA (Main Office, Chicago)        BANK ONE, NA (Main Office, Chicago)
                                            153 West 51st Street                       1 Bank One Plaza
                                            New York, New York  10019                  Chicago, IL  60670
                                            Attention:  Jules Panno                    Attention:  Deborah Turner
                                            Telephone:  212-373-1194                   Telephone:  312-732-3641
                                            Facsimile:  212-373-1180                   Facsimile:  312-732-4840
                                            Email: jules_panno@bankone.com             Email:

                                            BANK OF CHINA, NEW YORK BRANCH             THE BANK OF CHINA, NEW YORK BRANCH
                                            410 Madison Avenue                         410 Madison Avenue
                                            New York, New York  10017                  New York, New York  10017
                                            Attention:  David Haong                    Attention:  Elaine Ho
                                            Telephone: 212-935-3101                    Telephone:  212-935-3101
                                            Facsimile:  212-308-4993                   Facsimile:  646-840-1796
                                            Email:  Dhoang@bocusa.com                  Email:  Eho@bocusa.com

                                            SUMITOMO MITSUI BANKING CORPORATION        SUMITOMO MITSUI BANKING CORPORATION
                                            277 Park Avenue                            277 Park Avenue
                                            New York, New York  10172                  New York, New York  10172
                                            Attention:  Laura Buckley                  Attention:  Yvette Browne
                                            Telephone:  212-224-4170                   Telephone:  212-224-4306
                                            Facsimile:  212-224-4384                   Facsimile:  212-224-5197
                                            Email:  laura_j_buckley@smbcgroup.com      Email:  yvette_brown@smbcgroup.com
 Page 179

                                            NATIONAL CITY BANK                         NATIONAL CITY BANK
                                            One South Broad Street                     23000 Mill Creek Pkwy
                                            13th Floor                                 Highland Hills OH  44124
                                            Philadelphia, PA  19107                    Attention:  Vernon Johnson
                                            Attention:  Heather Gotwols                Telephone:  216-488-7099
                                            Telephone:  267-256-4052                   Facsimile:  216-488-7110
                                            Facsimile:  267-256-4001                   Email:
                                            Email:  heather.gotwols@nationalcity.com

                                            THE NORINCHUKIN BANK, NEW YORK BRANCH      THE NORINCHUKIN BANK, NEW YORK BRANCH
                                            245 Park Avenue, 29th Floor                245 Park Avenue, 29th Floor
                                            New York, New York  10167                  New York, New York  10167
                                            Attention:  Junya Morishita                Attention:  Connie Auyeung
                                            Telephone:  212-697-1717                   Telephone:  212-697-1717
                                            Facsimile:  212-697-5754                   Facsimile:  212-697-5754
                                            Email:  jmorishita@mochubank.or.jp         Email:

                                            WHITNEY NATIONAL BANK                      WHITNEY NATIONAL BANK
                                            228 St. Charles Avenue                     228 St. Charles Avenue
                                            New Orleans, LA  70130-2601                New Orleans, LA  70130-2601
                                            Attention:  M. Jesse Shannon               Attention:  Kitty Jordan
                                            Telephone:  504-552-4691                   Telephone:  504-539-7841
                                            Facsimile:  504-599-3073                   Facsimile:  504-552-4677
                                            Email:  jshannon@whitneybank.com           Email:  kjourdan@whitneybank.com
 Page 180

                                            MERRILL LYNCH BUSINESS                     MERRILL LYNCH BUSINESS
                                            FINANCIAL SERVICES INC.                    FINANCIAL SERVICES INC.
                                            222 North LaSalle Street, 17th Floor       222 North LaSalle Street, 17th Floor
                                            Chicago, IL  60601                         Chicago, IL  60601
                                            Attention:  Jason E. Deegan                Attention:  Jason E. Deegan
                                            Telephone:  312-269-4447                   Telephone:  312-269-4447
                                            Facsimile:  312-368-1387                   Facsimile:  312-368-1387
                                            Email:  jason_deegan@ml.com                Email:  jason_deegan@ml.com



 Page 181


                                    Exhibit A

                          FORM OF COMMITTED LOAN NOTICE

     Date:____________, _____

     To: Bank of America, N.A., as Administrative Agent

     Re: Credit Agreement dated as of September 10, 2002 (as amended,  restated,
     extended,  supplemented or otherwise modified in writing from time to time,
     the "Credit Agreement") among Albemarle Corporation, a Virginia corporation
     (the  "Borrower"),  the  Guarantors,  the  Lenders  from time to time party
     thereto, and Bank of America, N.A., as Administrative Agent, L/C Issuer and
     Swing Line Lender.  Capitalized terms used but not otherwise defined herein
     have the meanings provided in the Credit Agreement.

     Ladies and Gentlemen:

     The undersigned hereby requests (select one):

     ___ A Borrowing of [Domestic/Multicurrency] Committed Loans

     ___ A conversion or continuation of [Domestic/Multicurrency] Loans

     On ______,________ (a Business Day).

     Applicable Currency:__________ .

     In the amount of $_____________ .

     Comprised of ______________________(Type of Committed Loan requested).

     For Eurodollar Rate Loans: with an Interest Period of ________months.

     With  respect  to any  Borrowing  requested  herein,  the  Borrower  hereby
     represents   and  warrants   that  (i)  such  request   complies  with  the
     requirements  of Section 2.01 of the Credit  Agreement and (ii) each of the
     conditions  set forth in  Section  5.02 of the Credit  Agreement  have been
     satisfied on and as of the date of such Borrowing.

                                                     ALBEMARLE CORPORATION

                                                     By:___________________
                                                     Name:
                                                     Title:
 Page 182


                                    Exhibit B

                         FORM OF SWING LINE LOAN NOTICE

     Date:____________ ,_________

     To: Bank of America,  N.A., as Swing Line Lender Bank of America,  N.A., as
     Administrative Agent

     Re: Credit Agreement dated as of September 10, 2002 (as amended,  restated,
     extended,  supplemented or otherwise modified in writing from time to time,
     the "Credit Agreement") among Albemarle Corporation, a Virginia corporation
     (the  "Borrower"),  the  Guarantors,  the  Lenders  from time to time party
     thereto, and Bank of America, N.A., as Administrative Agent, L/C Issuer and
     Swing Line Lender.  Capitalized terms used but not otherwise defined herein
     have the meanings provided in the Credit Agreement.

     Ladies and Gentlemen:

     The undersigned hereby requests a Swing Line Loan:

     On _________ ,________ (a Business Day).

     In the amount of $_____________________.

     With respect to such Swing Line Borrowing,  the Borrower hereby  represents
     and  warrants  that (i) such  request  complies  with the  requirements  of
     Section 2.04(a) of the Credit Agreement and (ii) each of the conditions set
     forth in Section 5.02 of the Credit Agreement have been satisfied on and as
     of the date of such Swing Line Borrowing.

                                                     ALBEMARLE CORPORATION

                                                     By:___________________
                                                     Name:
                                                     Title:
 Page 183

                                    Exhibit C

                                  FORM OF NOTE
                                                           September 10, 2002

     FOR VALUE RECEIVED,  the undersigned (the  "Borrower"),  hereby promises to
     pay to  _____________________  or  registered  assigns (the  "Lender"),  in
     accordance  with the  provisions of the Credit  Agreement  (as  hereinafter
     defined),  the principal  amount of each Loan from time to time made by the
     Lender to the Borrower under that certain Credit  Agreement dated as of the
     date hereof (as  amended,  restated,  extended,  supplemented  or otherwise
     modified in writing from time to time,  the "Credit  Agreement")  among the
     Borrower, the Guarantors,  the Lenders from time to time party thereto, and
     Bank of America,  N.A., as Administrative  Agent, L/C Issuer and Swing Line
     Lender.  Capitalized  terms used but not otherwise  defined herein have the
     meanings provided in the Credit Agreement.

     The  Borrower  promises to pay interest on the unpaid  principal  amount of
     each Loan from the date of such Loan until such principal amount is paid in
     full,  at such  interest  rates and at such times as provided in the Credit
     Agreement.  Except as otherwise  provided in Section  2.04(f) of the Credit
     Agreement  with respect to Swing Line Loans,  all payments of principal and
     interest shall be made to the  Administrative  Agent for the account of the
     Lender in  Dollars in  immediately  available  funds at the  Administrative
     Agent's Office. If any amount is not paid in full when due hereunder,  such
     unpaid  amount shall bear  interest,  to be paid upon demand,  from the due
     date thereof until the date of actual  payment (and before as well as after
     judgment) computed at the per annum rate set forth in the Credit Agreement.

     This Note is one of the  Notes  referred  to in the  Credit  Agreement,  is
     entitled  to the  benefits  thereof  and may be prepaid in whole or in part
     subject to the terms and conditions  provided therein.  Upon the occurrence
     and  continuation of one or more of the Events of Default  specified in the
     Credit  Agreement,  all amounts  then  remaining  unpaid on this Note shall
     become,  or may be  declared  to be,  immediately  due and  payable  all as
     provided  in the  Credit  Agreement.  Loans  made by the  Lender  shall  be
     evidenced by one or more loan accounts or records  maintained by the Lender
     in the ordinary course of business. The Lender may also attach schedules to
     this Note and endorse  thereon the date,  amount and  maturity of its Loans
     and payments with respect thereto.

     The  Borrower,  for itself,  its  successors  and  assigns,  hereby  waives
     diligence,  presentment,  protest and demand and notice of protest, demand,
     dishonor and nonpayment of this Note.

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

 Page 184

                                        ALBEMARLE CORPORATION,
                                        a Virginia corporation

                                        By:___________________
                                        Name:
                                        Title:

 Page 185



                                                     LOANS AND PAYMENTS

                                                                                                   


                                                                                     Amount of       Outstanding
                                                  Applicable                        Principal or       Principal
              Type of Loan    Amount of Loan     Currency of         End of        Interest Paid     Balance This     Notation
    Date          Made             Made           Loan Made      Interest Period     This Date           Date          Made By
------------ --------------- ----------------- ----------------- ---------------- ----------------- ---------------- ------------
------------ --------------- ----------------- ----------------- ---------------- ----------------- ---------------- ------------
------------ --------------- ----------------- ----------------- ---------------- ----------------- ---------------- ------------
------------ --------------- ----------------- ----------------- ---------------- ----------------- ---------------- ------------
------------ --------------- ----------------- ----------------- ---------------- ----------------- ---------------- ------------
------------ --------------- ----------------- ----------------- ---------------- ----------------- ---------------- ------------
------------ --------------- ----------------- ----------------- ---------------- ----------------- ---------------- ------------
------------ --------------- ----------------- ----------------- ---------------- ----------------- ---------------- ------------
------------ --------------- ----------------- ----------------- ---------------- ----------------- ---------------- ------------
------------ --------------- ----------------- ----------------- ---------------- ----------------- ---------------- ------------
------------ --------------- ----------------- ----------------- ---------------- ----------------- ---------------- ------------
------------ --------------- ----------------- ----------------- ---------------- ----------------- ---------------- ------------
------------ --------------- ----------------- ----------------- ---------------- ----------------- ---------------- ------------
------------ --------------- ----------------- ----------------- ---------------- ----------------- ---------------- ------------
------------ --------------- ----------------- ----------------- ---------------- ----------------- ---------------- ------------
----------- ----------------- ----------------- ---------------- ----------------- ---------------- ---------------- ------------
------------ --------------- ----------------- ----------------- ---------------- ----------------- ---------------- ------------
------------ --------------- ----------------- ----------------- ---------------- ----------------- ---------------- ------------
------------ --------------- ----------------- ----------------- ---------------- ----------------- ---------------- ------------
------------ --------------- ----------------- ----------------- ---------------- ----------------- ---------------- ------------

 Page 186


                                    Exhibit D

                         FORM OF COMPLIANCE CERTIFICATE

     Financial Statement Date:_____________ , _____

     To: Bank of America, N.A., as Administrative Agent

     Re: Credit Agreement dated as of September 10, 2002 (as amended,  restated,
     extended,  supplemented or otherwise modified in writing from time to time,
     the "Credit Agreement") among Albemarle Corporation, a Virginia corporation
     (the  "Borrower"),  the  Guarantors,  the  Lenders  from time to time party
     thereto, and Bank of America, N.A., as Administrative Agent, L/C Issuer and
     Swing Line Lender.  Capitalized terms used but not otherwise defined herein
     have the meanings provided in the Credit Agreement.

     Ladies and Gentlemen:

     The undersigned  Responsible Officer hereby certifies as of the date hereof
     that [he/she] is the  ____________________  of the  Borrower,  and that, in
     [his/her]  capacity as such,  [he/she] is authorized to execute and deliver
     this Certificate to the Administrative Agent on the behalf of the Borrower,
     and that:

     [Use following paragraph 1 for fiscal year-end financial statements:]

     [1.  Attached  hereto as  Schedule  1 are the  year-end  audited  financial
     statements  required  by Section  7.01(a) of the Credit  Agreement  for the
     fiscal year of the Borrower  ended as of the above date,  together with the
     report and opinion of an independent  certified public accountant  required
     by such section.]

     [Use following paragraph 1 for fiscal quarter-end financial statements:]

     [1.  Attached hereto as Schedule 1 are the unaudited  financial  statements
     required by Section 7.01(b) of the Credit  Agreement for the fiscal quarter
     of the  Borrower  ended as of the above  date.  Such  financial  statements
     fairly  present the financial  condition,  results of  operations  and cash
     flows of the Borrower and its  Subsidiaries  in accordance  with GAAP as of
     such  date and for such  period,  subject  only to  normal  year-end  audit
     adjustments and the absence of footnotes.]

     [select one:]

     [2. To the best knowledge of the undersigned  during such fiscal period, no
     Default or Event of Default exists as of the date hereof.]

     [or:]

 Page 187

     [the following is a list of each existing Default or Event of Default,  the
     nature and extent  thereof,  and the  proposed  actions of the Loan Parties
     with respect thereto:]

     3. The  representations and warranties of the Borrower contained in Article
     VI of the  Credit  Agreement,  or  which  are  contained  in  any  document
     furnished at any time under or in connection with the Loan  Documents,  are
     true and  correct on and as of the date  hereof,  except to the extent that
     such representations and warranties  specifically refer to an earlier date,
     in which case they are true and correct as of such earlier date, and except
     that for purposes of this Compliance  Certificate,  the representations and
     warranties  contained  in  subsections  (a) and (b) of Section  6.05 of the
     Credit  Agreement  shall be deemed to refer to the most  recent  statements
     furnished pursuant to clauses (a) and (b), respectively, of Section 7.01 of
     the Credit  Agreement,  including the  statements in connection  with which
     this Compliance Certificate is delivered.

     4. The financial  covenant analyses and information set forth on Schedule 2
     attached  hereto  are  true  and  accurate  on and as of the  date  of this
     Certificate.

     5. Set forth below is a summary of all material  changes in GAAP and in the
     consistent  application  thereof  occurring  during the most recent  fiscal
     quarter  ending  prior to the date  hereof,  the  effect  on the  financial
     covenants resulting therefrom,  and a reconciliation between calculation of
     the financial  covenants (and determination of the applicable pricing level
     under the  definition of "Applicable  Percentage")  before and after giving
     effect to such changes:

     IN WITNESS  WHEREOF,  the undersigned  has executed this  Certificate as of
     __________ ___, ______.

                                            ALBEMARLE CORPORATION

                                            By:___________________
                                            Name:
                                            Title:
 Page 188


                                    Exhibit E

                        FORM OF ASSIGNMENT AND ASSUMPTION

     This Assignment and Assumption (this  "Assignment and Assumption") is dated
     as of the Effective Date set forth below and is entered into by and between
     [Insert name of Assignor]  (the  "Assignor")  and [Insert name of Assignee]
     (the  "Assignee").  Capitalized  terms used but not defined herein have the
     meanings provided in the Credit Agreement  identified  below,  receipt of a
     copy of which is hereby  acknowledged  by the Assignee.  The Standard Terms
     and  Conditions  set forth in Annex 1 attached  hereto are hereby agreed to
     and incorporated herein by reference and made a part of this Assignment and
     Assumption as if set forth herein in full.

     For an agreed  consideration,  the Assignor  hereby  irrevocably  sells and
     assigns to the Assignee,  and the Assignee hereby irrevocably purchases and
     assumes from the Assignor,  subject to and in accordance  with the Standard
     Terms and  Conditions  and the Credit  Agreement,  as of the Effective Date
     inserted by the  Administrative  Agent as contemplated below (i) all of the
     Assignor's  rights and  obligations as a Lender under the Credit  Agreement
     and any other documents or instruments  delivered  pursuant  thereto to the
     extent related to the amount and percentage  interest  identified  below of
     all of such  outstanding  rights and  obligations of the Assignor under the
     respective  facilities  identified below  (including,  without  limitation,
     Letters of Credit and Swing Line Loans  included  in such  facilities)  and
     (ii) to the extent  permitted  to be assigned  under  applicable  law,  all
     claims, suits, causes of action and any other right of the Assignor (in its
     capacity as a Lender) against any Person, whether known or unknown, arising
     under or in connection  with the Credit  Agreement,  any other documents or
     instruments  delivered  pursuant thereto or the loan transactions  governed
     thereby  or in any  way  based  on or  related  to  any  of the  foregoing,
     including,  but not limited to, contract claims,  tort claims,  malpractice
     claims,  statutory  claims and all other claims at law or in equity related
     to the rights and  obligations  sold and  assigned  pursuant  to clause (i)
     above (the rights and obligations sold and assigned pursuant to clauses (i)
     and (ii) above being  referred  to herein  collectively  as, the  "Assigned
     Interest").  Such sale and  assignment is without  recourse to the Assignor
     and,  except as  expressly  provided  in this  Assignment  and  Assumption,
     without representation or warranty by the Assignor.

     1. Assignor:

     2. Assignee: [and is an Affiliate/Approved Fund of [identify Lender]]

     3. Borrower: Albemarle Corporation, a Virginia corporation

     4. Administrative Agent: Bank of America, N.A.

 Page 189

     5. Credit Agreement: The Credit Agreement dated as of September 10, 2002 by
     and among the Borrower,  the Guarantors,  the Lenders parties thereto,  and
     Bank of America,  N.A., as Administrative  Agent, L/C Issuer and Swing Line
     Lender

 Page 190




     6. Assigned Interest:
                                                                                               


--------------------------------- --------------------------- ----------------------------- ---------------------------
                                     Aggregate Amount of               Amount of
                                       Commitment/Loans             Commitment/Loans          Percentage Assigned of
       Facility Assigned               for all Lenders                  Assigned                 Commitment/Loans
--------------------------------- --------------------------- ----------------------------- ---------------------------
      Domestic Commitment                $______________              $______________                ________%
    Multicurrency Commitment             $______________              $______________                ________%
--------------------------------- --------------------------- ----------------------------- ---------------------------


     [7. Trade Date: __________________]

     Effective Date: __________________, _____

     The terms set forth in this Assignment and Assumption are hereby agreed to:

     ASSIGNOR:                       [NAME OF ASSIGNOR]
                                      By:___________________
                                      Name:
                                      Title:


     ASSIGNEE:                       [NAME OF ASSIGNEE]

                                      By:___________________
                                      Name:
                                      Title:

     [Consented to and]2 Accepted:


     BANK OF AMERICA, N.A., as Administrative Agent

     By:
     Name:
     Title:

 Page 191

     [Consented to:]3

     [_______________ ]

     [By:___________________]
     [Name:                 ]
     [Title:                ]

     1 To be inserted by  Administrative  Agent;  shall be the effective date of
     recordation of transfer in the register therefor.

     2 To be added only if the consent of the  Administrative  Agent is required
     by the terms of the Credit Agreement.

     3 To be added only if the  consent of the  Borrower  and/or  other  parties
     (e.g. Swing Line Lender, L/C Issuer) is required by the terms of the Credit
     Agreement.

 Page 192


                      Annex 1 to Assignment and Assumption

                          STANDARD TERMS AND CONDITIONS

     1. Representations and Warranties.

     1.1. Assignor.  The Assignor (a) represents and warrants that (i) it is the
     legal and  beneficial  owner of the  Assigned  Interest,  (ii) the Assigned
     Interest is free and clear of any lien,  encumbrance or other adverse claim
     and  (iii) it has full  power  and  authority,  and has  taken  all  action
     necessary,  to execute and deliver this  Assignment  and  Assumption and to
     consummate  the  transactions  contemplated  hereby;  and  (b)  assumes  no
     responsibility   with  respect  to  (i)  any   statements,   warranties  or
     representations  made in or in connection with the Credit  Agreement or any
     other   Loan   Document,   (ii)   the   execution,    legality,   validity,
     enforceability,  genuineness, sufficiency or value of the Loan Documents or
     any collateral  thereunder,  (iii) the financial condition of the Borrower,
     any of its  Subsidiaries  or  Affiliates  or any other Person  obligated in
     respect of any Loan Document or (iv) the  performance  or observance by the
     Borrower,  any of its Subsidiaries or Affiliates or any other Person of any
     of their respective obligations under any Loan Document.

     1.2.  Assignee.  The Assignee (a)  represents  and warrants that (i) it has
     full power and authority,  and has taken all action  necessary,  to execute
     and  deliver  this   Assignment   and  Assumption  and  to  consummate  the
     transactions  contemplated  hereby and to become a Lender  under the Credit
     Agreement, (ii) it meets all requirements of an Eligible Assignee under the
     Credit  Agreement  (subject to receipt of such  consents as may be required
     under the Credit  Agreement),  (iii) from and after the Effective  Date, it
     shall  be bound  by the  provisions  of the  Credit  Agreement  as a Lender
     thereunder  and,  to the extent of the  Assigned  Interest,  shall have the
     obligations  of a Lender  thereunder,  (iv) it has  received  a copy of the
     Credit  Agreement,  together  with  copies  of the  most  recent  financial
     statements  delivered pursuant to Section 7.01 thereof, as applicable,  and
     such other documents and  information as it has deemed  appropriate to make
     its own credit  analysis  and  decision to enter into this  Assignment  and
     Assumption  and to purchase the Assigned  Interest on the basis of which it
     has made such analysis and decision  independently  and without reliance on
     the  Administrative  Agent or any other Lender,  and (v) if it is a Foreign
     Lender, attached hereto is any documentation required to be delivered by it
     pursuant to the terms of the Credit Agreement,  duly completed and executed
     by the Assignee; and (b) agrees that (i) it will, independently and without
     reliance on the Administrative Agent, the Assignor or any other Lender, and
     based on such documents and information as it shall deem appropriate at the
     time,  continue  to make its own credit  decisions  in taking or not taking
     action under the Loan  Documents,  and (ii) it will  perform in  accordance
     with  their  terms  all of the  obligations  which by the terms of the Loan
     Documents are required to be performed by it as a Lender.

     2. Payments.  From and after the Effective Date, the  Administrative  Agent
     shall make all  payments  in respect of the  Assigned  interest  (including
     payments of principal,  interest,  fees and other  amounts) to the Assignee
     whether such amounts  have  accrued  prior to or on or after the  Effective
     Date. The Assignor and the Assignee shall make all appropriate

 Page 193

     adjustments  in payments by the  Administrative  Agent for periods prior to
     the  Effective  Date or  with  respect  to the  making  of this  assignment
     directly between themselves.

     3. General  Provisions.  This  Assignment and  Assumption  shall be binding
     upon, and inure to the benefit of, the parties hereto and their  respective
     successors and assigns.  This  Assignment and Assumption may be executed in
     any number of counterparts, which together shall constitute one instrument.
     Delivery of an executed  counterpart of a signature page of this Assignment
     and  Assumption  by telecopy  shall be  effective as delivery of a manually
     executed counterpart of this Assignment and Assumption. This Assignment and
     Assumption  shall be governed by, and construed in accordance with, the law
     of the State of New York.

 Page 194


                                    Exhibit G

                            FORM OF JOINDER AGREEMENT

     THIS JOINDER AGREEMENT (the "Agreement"),  dated as of ______________ is by
     and between  _____________________,  a  ___________________  (the "Material
     Domestic  Subsidiary"),  and Bank of  America,  N.A.,  in its  capacity  as
     Administrative  Agent  under  that  certain  Credit  Agreement  dated as of
     September  10, 2002 (as  amended,  modified,  supplemented,  increased  and
     extended from time to time, the "Credit  Agreement";  terms defined therein
     are used herein as therein defined) among Albemarle Corporation, a Virginia
     corporation (the "Borrower"), the Guarantors, the Lenders from time to time
     party thereto and Bank of America, N.A., as Administrative Agent.

     The Loan Parties are  required by Section  7.12 of the Credit  Agreement to
     cause the Material Domestic Subsidiary to become a "Guarantor"  thereunder.
     Accordingly, the Material Domestic Subsidiary hereby agrees as follows with
     the Administrative Agent, for the benefit of the Lenders:

     1.  The  Material  Domestic  Subsidiary  hereby  acknowledges,  agrees  and
     confirms that, by its execution of this  Agreement,  the Material  Domestic
     Subsidiary  will be  deemed  to be a party to the  Credit  Agreement  and a
     "Guarantor" for all purposes of the Credit Agreement, and shall have all of
     the obligations of a Guarantor  thereunder as if it had executed the Credit
     Agreement. The Material Domestic Subsidiary hereby ratifies, as of the date
     hereof,  and  agrees  to be bound  by,  all of the  terms,  provisions  and
     conditions  applicable to the Guarantors contained in the Credit Agreement.
     Without limiting the generality of the foregoing terms of this paragraph 1,
     the Material Domestic Subsidiary hereby jointly and severally together with
     the other  Guarantors,  guarantees  to each  Lender and the  Administrative
     Agent, as provided in Section 4 of the Credit Agreement, the prompt payment
     and  performance  of the  Obligations  in full when due  (whether at stated
     maturity, as a mandatory prepayment, by acceleration or otherwise) strictly
     in accordance with the terms thereof.

     2. The address of the  Material  Domestic  Subsidiary  for  purposes of all
     notices and other communications is:

     [Material Domestic Subsidiary]

     Attention:
     Telephone:
     Facsimile:

 Page 195

     3.  The  Material  Domestic  Subsidiary  hereby  waives  acceptance  by the
     Administrative  Agent  and the  Lenders  of the  guaranty  by the  Material
     Domestic  Subsidiary  under  Section  4 of the  Credit  Agreement  upon the
     execution of this Agreement by the Material Domestic Subsidiary.

     4. This Agreement may be executed in multiple  counterparts,  each of which
     shall  constitute  an original but all of which when taken  together  shall
     constitute one contract.

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

 Page 196

     IN WITNESS  WHEREOF,  the  Material  Domestic  Subsidiary  has caused  this
     Joinder  Agreement to be duly executed by its authorized  officer,  and the
     Administrative  Agent, for the benefit of the Lenders,  has caused the same
     to be  accepted  by its  authorized  officer,  as of the day and year first
     above written.

                                     [MATERIAL DOMESTIC SUBSIDIARY]
                                      By:___________________
                                      Name:
                                      Title:


     Acknowledged and accepted:

     BANK OF AMERICA, N.A., as Administrative Agent

     By:___________________
     Name:
     Title:

 Page 197


                                    Exhibit H

                        FORM OF LENDER JOINDER AGREEMENT

     THIS LENDER JOINDER  AGREEMENT (this  "Agreement")  dated as of __________,
     _____ to the Credit Agreement referenced below is by and among [NEW LENDER]
     (the "New Lender"),  ALBEMARLE  CORPORATION,  a Virginia  corporation  (the
     "Borrower"),  certain  Subsidiaries  and  Affiliates  of the  Borrower,  as
     Guarantors,  and BANK OF AMERICA,  N.A., as  administrative  agent (in such
     capacity,  the "Administrative  Agent") for the Lenders. All of the defined
     terms of the Credit Agreement are incorporated herein by reference.

                               W I T N E S S E T H

     WHEREAS,  pursuant to that Credit  Agreement dated as of September 10, 2002
     (as amended and modified from time to time, the "Credit  Agreement")  among
     the Borrower, the Guarantors, the Lenders and the Administrative Agent, the
     Lenders  have  agreed to  provide  the  Borrower  with a  revolving  credit
     facility;

     WHEREAS,  pursuant to Section 2.1(c) of the Credit Agreement,  the Borrower
     has requested  that the New Lender provide an additional  Commitment  under
     the Credit Agreement; and

     WHEREAS, the New Lender has agreed to provide the additional  Commitment on
     the terms and  conditions  set forth herein and to become a "Lender"  under
     the Credit Agreement in connection therewith;

     NOW,  THEREFORE,  IN  CONSIDERATION  of these  premises  and other good and
     valuable  consideration,  the receipt and  sufficiency  of which are hereby
     acknowledged, the parties hereto agree as follows:

     1. The New  Lender  hereby  agrees  to  provide  Domestic  Commitments  and
     Multicurrency  Commitments  to the  Borrower  in the  amounts  set forth on
     Schedule 2.01 to the Credit Agreement as attached hereto.  The Domestic Pro
     Rata  Share and the  Multicurrency  Pro Rata Share of the New Lender are as
     set forth on Schedule 2.01.

     2. The New Lender shall be deemed to have purchased without recourse:

     (a) a risk  participation  from the  Domestic  L/C  Issuer in all  Domestic
     Letters of Credit issued or existing under the Credit Agreement  (including
     Existing  Letters of Credit  that are  Domestic  Letters of Credit) and the
     obligations  arising thereunder in an amount equal to its Domestic Pro Rata
     Share  of  the  obligations  under  such  Letters  of  Credit,   and  shall
     absolutely,  unconditionally and irrevocably assume, as primary obligor and
     not as surety,  and be obligated to pay to the Domestic L/C Issuer therefor
     and  discharge  when due, its  Domestic  Pro Rata Share of the  obligations
     arising under such Letter of Credit; and

 Page 198

     (b)  a  risk  participation  from  the  Multicurrency  L/C  Issuer  in  all
     Multicurrency  Letters  of Credit  issued  or  existing  under  the  Credit
     Agreement  (including  Existing  Letters of Credit  that are  Multicurrency
     Letters of Credit)  and the  obligations  arising  thereunder  in an amount
     equal to its  Multicurrency  Pro Rata Share of the  obligations  under such
     Letters of Credit,  and shall absolutely,  unconditionally  and irrevocably
     assume,  as primary  obligor and not as surety,  and be obligated to pay to
     the   Multicurrency  L/C  Issuer  therefor  and  discharge  when  due,  its
     Multicurrency  Pro Rata Share of the obligations  arising under such Letter
     of Credit.

     3. The New Lender  (a)  represents  and  warrants  that it is a  commercial
     lender,  other  financial  institution or other  "accredited"  investor (as
     defined in SEC  Regulation D) that makes or acquires  loans in the ordinary
     course  of  business  and that it will  make or  acquire  Loans for its own
     account  in the  ordinary  course of  business,  (b)  confirms  that it has
     received  a copy of the  Credit  Agreement,  together  with  copies  of the
     financial  statements  referred to in Section  7.01  thereof and such other
     documents  and  information  as it has deemed  appropriate  to make its own
     credit analysis and decision to enter into this Agreement;  (c) agrees that
     it will,  independently and without reliance upon the Administrative  Agent
     or any other Lender and based on such documents and information as it shall
     deem appropriate at the time,  continue to make its own credit decisions in
     taking or not taking  action under the Credit  Agreement;  (d) appoints and
     authorizes  the  Administrative  Agent to take such  action as agent on its
     behalf  and to  exercise  such  powers  and  discretion  under  the  Credit
     Agreement  as  are  delegated  to the  Administrative  Agent  by the  terms
     thereof,  together  with  such  powers  and  discretion  as are  reasonably
     incidental  thereto;  and (e) agrees that,  as of the date hereof,  the New
     Lender  shall (i) be a party to the  Credit  Agreement  and the other  Loan
     Documents,  (ii) be a "Lender" for all purposes of the Credit Agreement and
     the other Loan Documents,  (iii) perform all of the obligations that by the
     terms of the Credit  Agreement  are  required  to be  performed  by it as a
     "Lender"  under the  Credit  Agreement  and (iv)  shall have the rights and
     obligations  of a Lender  under the  Credit  Agreement  and the other  Loan
     Documents.

     4. Each of the Borrower  and the  Guarantors  agrees  that,  as of the date
     hereof, the New Lender shall (i) be a party to the Credit Agreement and the
     other Loan  Documents,  (ii) be a "Lender"  for all  purposes of the Credit
     Agreement  and the other  Loan  Documents,  and (iii)  have the  rights and
     obligations  of a Lender  under the  Credit  Agreement  and the other  Loan
     Documents.

     5. The  address of the New Lender for  purposes  of all  notices  and other
     communications is:

 Page 199

     6. This Agreement may be executed in any number of counterparts  and by the
     various  parties  hereto in  separate  counterparts,  each of which when so
     executed  shall be deemed to be an original and all of which taken together
     shall constitute one contract.  Delivery of an executed counterpart of this
     Agreement  by  telecopier  shall be  effective  as  delivery  of a manually
     executed counterpart of this Agreement.

     7. This  Agreement  shall be governed by and construed and  interpreted  in
     accordance with the laws of the State of New York.

                       [remainder of page intentionally left blank]

 Page 200

     IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
     be  executed  by a duly  authorized  officer  as of the  date  first  above
     written.

     NEW LENDER:                [NEW LENDER], as New Lender

                                By:___________________
                                Name:
                                Title:

     BORROWER:                  ALBEMARLE CORPORATION, a Virginia corporation

                                By:___________________
                                Name:
                                Title:

     GUARANTORS:               [EACH GUARANTOR]

                                By:___________________
                                Name:
                                Title:
                                of each of the foregoing

     Accepted and Agreed:

     BANK OF AMERICA, N.A.,
     as Administrative Agent

     By:___________________
     Name:
     Title:

 Page 201

EXHIBIT 99
----------



                          List of Albemarle Corporation Officers Effective November 1, 2002
                          -----------------------------------------------------------------
                                      

Name                                 Officers
----------------------------------------------------------------------------------------------------------------------------------
William M. Gottwald*                 Chairman of the Board and Secretary to the Executive Committee as Management Committee

Floyd D. Gottwald, Jr.*              Vice Chairman of the Board and Chairman of the Executive Committee

Charles B. Walker*                   Vice Chairman of the Board

Mark C. Rohr*                        President and Chief Executive Officer

E. Whitehead Elmore                  Executive Vice President

Paul F. Rocheleau                    Senior Vice President and Chief Financial Officer

John G. Dabkowski                    Vice President - Polymer Chemicals

Thomas F. Dominick                   Vice President

Jack P. Harsh                        Vice President - Human Resources

George P. Manson, Jr.                Vice President, General Counsel and Secretary

George A. Newbill                    Vice President - Sourcing Organization

John J. Nicols                       Vice President - Fine Chemicals

John M. Steitz                       Vice President - Business Operations

Gary L. Ter Haar                     Vice President-Health and Environment

Michael D. Whitlow                   Vice President-Americas Sales and Global Accounts

Edward G. Woods                      Vice President-Corporate Development

Michael J. Zobrist                   Vice President - Investor Relations/External Affairs

Robert G. Kirchhoefer                Treasurer and Chief Accounting Officer

Richard A. Sabalot                   Assistant Secretary

*Member of the Executive Committee