================================================================================
                     SECURITIES AND EXCHANGE COMMISSION
                           WASHINGTON, D.C. 20549

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

                                  FORM 8-K
                               CURRENT REPORT
   PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

                      DATE OF REPORT - OCTOBER 9, 1998
                     (Date of earliest event reported)

                             ALLIEDSIGNAL INC.
           (Exact name of Registrant as specified in its Charter)

DELAWARE                                 001-08974             22-2640650
(State or other jurisdiction     (Commission File Number)      (I.R.S. Employer
of incorporation)                                              Identification
Number)

101 COLUMBIA ROAD, P.O. BOX 4000, MORRISTOWN, NEW JERSEY        07962-2497
(Address of principal executive offices)                        (Zip Code)

     Registrant's telephone number, including area code: (973) 455-2000

================================================================================

          Safe Harbor  Statement  under the Private  Securities  Litigation
Reform Act of 1995: Except for the historical information contained herein,
the matters discussed in this current report are forward-looking statements
which  involve  risks  and  uncertainties,  including  but not  limited  to
economic, competitive, governmental and technological factors affecting the
Registrant's operations,  markets, products, services and prices, and other
factors  discussed  herein and in the  Registrant's  other filings with the
Securities and Exchange Commission.

ITEM 5. OTHER EVENTS.

Third Quarter 1998 Results of Operations
- ----------------------------------------

          AlliedSignal  Inc.  (the  "Company")  issued a press  release  on
October 15, 1998  reporting  the following  results of  operations  for the
three-month and nine-month periods ending September 30, 1998:

                             AlliedSignal Inc.
                Consolidated Statement of Income (Unaudited)
                --------------------------------------------
                   (In millions except per share amounts)

                                     THREE MONTHS              NINE MONTHS
                                   ENDED SEPTEMBER 30      ENDED SEPTEMBER 30
                                  --------------------    --------------------
                                    1998        1997        1998        1997
                                  --------    --------    --------    --------

Net sales                         $3,741       $3,657      $11,256     $10,562
                                  --------    --------    --------    --------

Cost of goods sold                 2,838        2,840        8,596       8,209
Selling, general and
administrative expenses              396          394        1,200       1,145
                                  --------    --------    --------    --------

     Total costs and expenses      3,234        3,234        9,796       9,354
                                  --------    --------    --------    --------

Income from operations               507          423        1,460       1,208
Equity in income of affiliated
companies                             19           44           82         140
Other income (expense)                (8)          14           (9)         62
Interest and other financial
charges                              (38)         (50)        (104)       (131)
                                  --------    --------    --------    --------

Income before taxes on income        480          431        1,429       1,279
Taxes on income                      151          139          450         423
                                  --------    --------    --------    --------

Net income                          $329         $292         $979        $856
                                  ========    ========    ========    ========

Earnings per share of common
stock - 
        basic                      $0.59        $0.52        $1.74       $1.51
                                  ========    ========    ========    ========

Earnings per share of common
stock - 
        assuming dilution          $0.58        $0.50        $1.70       $1.47
                                  ========    ========    ========    ========

Weighted average number of
shares outstanding - 
        basic                        560          564          562         566
                                  ========    ========    ========    ========

Weighted average number of
shares outstanding - 
        assuming dilution            572          581          576         581
                                  ========    ========    ========    ========

                             AlliedSignal Inc.
                                Segment Data
                                ------------
                           (Dollars in Millions)

                      THREE MONTHS ENDED SEPTEMBER 30
                      -------------------------------

                                       Net Sales               Net Income
                                  --------------------    --------------------
                                    1998        1997        1998        1997
                                  --------    --------    --------    --------

Aerospace Systems                   $1,242      $1,080        $162        $101

Specialty Chemicals &
Electronic Solutions                   541         536          56          72

Turbine Technologies                   900         771          68          52

Performance Polymers                   436         509          45          46

Transportation Products                619         757          10          18
                                  --------    --------    --------    --------

     Total Businesses                3,738       3,653         341         289

Corporate & Unallocated                  3           4         (12)          3
                                  --------    --------    --------    --------

Total                               $3,741      $3,657        $329        $292
                                  ========    ========    ========    ========

                       NINE MONTHS ENDED SEPTEMBER 30
                       ------------------------------

                                       Net Sales               Net Income
                                  --------------------    --------------------
                                    1998        1997        1998        1997
                                  --------    --------    --------    --------

Aerospace Systems                   $3,576      $2,919        $401        $245

Specialty Chemicals &
Electronic Solutions                 1,728       1,626         220         259

Turbine Technologies                 2,641       2,242         184         160

Performance Polymers                 1,494       1,507         147         104

Transportation Products              1,809       2,259          28          80
                                  --------    --------    --------    --------

     Total Businesses               11,248      10,553         980         848

Corporate & Unallocated                  8           9          (1)          8
                                  --------    --------    --------    --------

Total                              $11,256     $10,562        $979        $856
                                  ========    ========    ========    ========

Year 2000 Update
- ----------------

          Computer  programs and embedded  computer chips that are not Year
2000 compliant are unable to distinguish between the calendar year 1900 and
the calendar year 2000.  The Company has recognized the need to ensure that
its  business  operations  will not be  adversely  affected by the upcoming
calendar  year 2000 and is  cognizant of the time  sensitive  nature of the
Year 2000 problem.

          The Company has  assessed how it may be impacted by the Year 2000
problem  and is  implementing  a  comprehensive  plan to address  all known
aspects  of the Year  2000  problem:  information  systems  (both  critical
information  systems,  which are  systems the failure of which could have a
material effect on the Company's  operations,  and noncritical  information
systems), production  and  facilities  equipment,  products,  customers and
suppliers (both high-impact suppliers,  which are those suppliers who would
materially  impact the Company's  operations if they were unable to provide
supplies or services on a timely basis, and other suppliers).

          The Company has  completed an inventory of  information  systems,
production and facilities equipment, products, customers and suppliers that
may  potentially  have a Year 2000  problem.  The Company has  assessed the
impact of a Year 2000  problem  with  respect to its  information  systems,
production and facilities  equipment,  products and suppliers identified in
the inventory, and is currently assessing the impact of a Year 2000 problem
with respect to its customers.  Based on the results of the assessment, the
Company  prioritizes  the various  projects to remedy  potential  Year 2000
problems.  The Company is developing  and  implementing  plans to remediate
known  Year 2000  problems.  Testing  to  ensure  that the  remediation  is
successfully  completed is part of the remediation process.  Because of the
importance of  addressing  the Year 2000  problem,  the Company  expects to
develop  by the  first  quarter  of  1999  contingency  plans  and  trained
specialist  teams to implement such  contingency  plans to address any Year
2000 problems  which are  unexpected or are not remedied in a timely manner
under the Company's remediation plans.

          The  following   table  sets  forth  the   estimated   dates  for
substantially  completing assessment,  development of remediation plans and
remediation with respect to the various aspects of the Year 2000 problem:

                                            Development of
                            Assessment     Remediation Plan    Remediation

Critical Information
   Systems                      SC               SC             12/31/98
Other Information Systems       SC               SC             3/31/99
Production and Facilities
   Equipment                    SC            11/15/98          3/31/99
Products                        SC               SC             3/31/99
Customers                    12/31/98          1/31/99          3/31/99
High Impact Suppliers           SC            12/31/98          3/31/99
Other Suppliers                 SC             3/31/99          6/30/99

      SC = Substantially Complete

          The  remediation   plans  for   information   systems  involve  a
combination  of  software  modification,   upgrades  and  replacement.  The
remediation  plans  for  production  and  facilities  equipment  involve  a
combination of software or hardware modification, upgrades and replacement,
or changes to operating  procedures to circumvent equipment failures caused
by the Year  2000  problem.  The  remediation  plans for  products  involve
modifying  software  and/or  hardware  contained  in  products,  or issuing
service  letters  or  other  industry  standard  communications   providing
customers with instructions on correcting Year 2000 issues in the Company's
products.  The  remediation  plans  for  suppliers  and  customers  involve
obtaining  information  about  the Year  2000  programs  of  suppliers  and
customers through surveys, meetings and other communication, the evaluation
of the information received,  and the development of appropriate responses.
While  the  Company  expects  that  development  of  remediation  plans and
remediation  with respect to suppliers and  customers  will be completed by
the  dates set  forth in the  table  above,  the  Company  can  provide  no
assurance  that  Year  2000  problems  will be  successfully  corrected  by
suppliers and customers in a timely manner.

          The   Company's   estimate  of  the  total  cost  for  Year  2000
compliance,  based on the  assessment to date plus estimates of remediation
costs for customers not yet fully assessed, is approximately  $150 million,
of which  approximately $71 million has been incurred through September 30,
1998. This estimate does not include the Company's potential share of costs
for Year  2000  issues by  partnerships  and  joint  ventures  in which the
Company participates but is not the operator.  Incremental spending has not
been and is not expected to be material  because most Year 2000  compliance
costs will be met with amounts that are normally  budgeted for  procurement
and  maintenance  of the Company's  information  systems and production and
facilities  equipment.  The  redirection  of spending from  procurement  of
information   systems  and   production   and   facilities   equipment   to
implementation  of Year 2000  compliance  plans may in some instances delay
productivity improvements.

          The Company presently  believes that the Year 2000 issue will not
cause  material  operational  problems  for the  Company.  However,  if the
Company is not successful in  identifying  all material Year 2000 problems,
or  assessment  and  remediation  of  identified  Year 2000 problems is not
completed in a timely manner,  there may be an interruption  in, or failure
of, certain normal business activities or operations. Such interruptions or
failures could have a material adverse impact on the Company's consolidated
results  of  operations,  liquidity  and  financial  condition,  or on  its
relationships with customers, suppliers or others.

Revolving Credit Agreements
- ---------------------------

          Pursuant  to a tender  offer by PMA  Acquisition  Corporation,  a
Delaware  corporation  ("PMA") and wholly owned  subsidiary of AlliedSignal
Inc.  ("AlliedSignal"),  to purchase  shares of common  stock,  without par
value, of AMP Incorporated (the "Shares"),  AlliedSignal on October 9, 1998
entered into a 364 Day Backstop Credit  Agreement (the "Credit  Agreement")
by and among  AlliedSignal,  Bank of America  NT&SA,  Banque  Nationale  de
Paris,  Barclays  Bank PLC,  Citibank,  N.A.,  Deutsche  Bank AG and Morgan
Guaranty  Trust  Company  of New York  (collectively,  the  "Lenders")  and
Citibank,  N.A., as Agent.  In accordance  with the Credit  Agreement,  the
Lenders agreed to lend to AlliedSignal  and its designated  subsidiaries up
to $900,000,000 to finance the acquisition of Shares pursuant to an initial
tender  offer for 20 million  Shares (the  "Initial  Offer") by PMA and for
general corporate purposes, including commercial paper backstop. On October
13, 1998, the Shares acquired in the Initial  Offer for  $890,000,000  were
paid by proceeds from sales of commercial paper.

          Loans under the Credit  Agreement  are  repayable  364 days after
October 9, 1998 (the  "Commitment  Termination  Date") unless  AlliedSignal
elects to convert  the loans  into a term loan (the  "Term Loan  Conversion
Option"),  in which case the loan will be repayable no later than the first
anniversary of the Commitment Termination Date.

          To the extent AlliedSignal elects to draw on this facility, loans
outstanding  under the Credit  Agreement will bear interest at a rate based
on (i) the base rate plus a margin of 0% or (ii) the Eurocurrency rate plus
a margin  ranging  from (x) if  AlliedSignal  has not elected the Term Loan
Conversion  Option,  0.17% to 0.5% and (y) if AlliedSignal  has elected the
Term Loan  Conversion  Option,  0.225% to 0.7%, in each case,  depending on
AlliedSignal's long term senior unsecured non-credit enhanced debt rating.

          On October 9, 1998, in  anticipation  of a possible  tender offer
for all of the remaining  outstanding  Shares (the  "Offer"),  AlliedSignal
also signed  commitments with Banque Nationale de Paris,  Barclays Capital,
the  investment  banking  division  of  Barclays  Bank PLC,  Deutsche  Bank
Securities  Inc.,  J.P.  Morgan  Securities  Inc.,  NationsBanc  Montgomery
Securities   LLC  and  Salomon   Smith  Barney  Inc.   (collectively,   the
"Arrangers") in connection with a 364 day revolving  credit facility in the
amount of $7,000,000,000 (the "364 Day Facility") and a five year revolving
credit facility in the amount of  $2,250,000,000  (the "5 Year  Facility").
The purpose of these  facilities is to finance the acquisition of Shares of
the Company pursuant to the Offer and a proposed business  combination with
AMP Incorporated and for general corporate purposes,  including  commercial
paper   backstop.   The  Company  intends  to  finance  a  portion  of  the
approximately $9,100,000,000 required to purchase the remaining outstanding
Shares  under the Offer by a  combination  of short,  medium  and  possibly
long-term borrowings in the private and public debt markets.

          The Arrangers have committed to provide $4,750,000,000 of the 364
Day  Facility  and  the 5 Year  Facility,  subject  to  certain  terms  and
conditions,  including  successful  syndication  of the  balance  of  these
facilities.  The Arrangers have agreed to use best efforts to complete that
syndication.

          The  364 Day  Facility  has a term of 364  days,  subject  to the
Company's ability to request extensions for additional 364 day periods.  In
addition,  AlliedSignal  may  elect the Term Loan  Conversion  Option  with
respect to  $4,000,000,000  of loans under the 364 Day Facility on the same
basis as that for the Credit  Agreement.  The 5 Year Facility has a term of
five years.

          It is  currently  anticipated  that  to the  extent  AlliedSignal
elects to draw on the 364 Day Facility, loans thereunder will bear interest
at (i) the base  rate plus a margin  of 0% and (ii) the  Eurocurrency  rate
plus a margin  ranging  from (x) if  AlliedSignal  has not elected the Term
Loan Conversion  Option,  0.17% to 0.5% and (y) if AlliedSignal has elected
the Term Loan Conversion Option,  0.225% to 0.7%, in each case depending on
AlliedSignal's long term senior unsecured non-credit enhanced debt ratings.

          It is  currently  anticipated  that  to the  extent  AlliedSignal
elects to draw on the 5 Year Facility,  loans thereunder will bear interest
at (i) the base  rate plus a margin  of 0% and (ii) the  Eurocurrency  rate
plus a margin ranging from 0.15% to 0.45%, depending on AlliedSignal's long
term senior unsecured non-credit enhanced debt ratings.

          It  is  anticipated  that  approximately  $1,500,000,000  of  the
indebtedness  initially  incurred by  AlliedSignal  in connection  with the
Initial  Offer and the Offer  will be repaid  from the  issuance  of equity
securities  of   AlliedSignal,   approximately   $2,000,000,000   from  the
disposition of assets and the remainder from a combination of short, medium
and long-term  borrowings  in the bank,  private or public debt markets and
from  funds  internally  generated  by  AlliedSignal  and its  subsidiaries
(including, after the acquisition of AMP Incorporated is consummated,  cash
flow of the  surviving  corporation).  No final  decisions  have  been made
concerning  the  method  AlliedSignal  will  employ  to repay  its  initial
borrowings  incurred to consummate  the Initial Offer and the Offer.  These
decisions,  when made, will be based on AlliedSignal's  review from time to
time of the  advisability of particular  actions,  as well as on prevailing
interest  rates,  stock and debt markets and financial  and other  economic
conditions.  Furthermore,  of  course,  there  can  be  no  assurance  that
AlliedSignal  will  be  able to  utilize  any one or more of the  repayment
options or of the amount that will be available under any of them.

ITEM 7. EXHIBITS.

Exhibit No.    Description
- ----------     -----------

99.1           364 Day Backstop  Credit  Agreement,  dated as of October 9,
               1998, by and among AlliedSignal Inc., Bank of America NT&SA,
               Banque  Nationale  de Paris,  Barclays  Bank PLC,  Citibank,
               N.A.,  Deutsche Bank AG and Morgan Guaranty Trust Company of
               New York, as Lenders, and Citibank, N.A., as Agent.

99.2           Commitment  Letter,  dated as of October 9, 1998,  by Banque
               Nationale de Paris, Barclays Capital, the investment banking
               division  of Barclays  Bank PLC,  Deutsche  Bank  Securities
               Inc., J.P. Morgan  Securities Inc.,  NationsBanc  Montgomery
               Securities  LLC and  Salomon  Smith  Barney  Inc.,  and Term
               Sheets relating to the aforementioned Commitment Letter.

                                 SIGNATURE

          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 hereunto duly authorized.

Date: October 21, 1998                   AlliedSignal Inc.
                                         (Registrant)

                                         By:  /s/ Peter Kreindler
                                              -----------------------------
                                              Peter Kreindler
                                              Senior Vice President,
                                              General Counsel and Secretary

                               EXHIBIT INDEX

Exhibit No.    Description
- ----------     -----------

99.1           364 Day Backstop  Credit  Agreement,  dated as of October 9,
               1998, by and among AlliedSignal Inc., Bank of America NT&SA,
               Banque  Nationale  de Paris,  Barclays  Bank PLC,  Citibank,
               N.A.,  Deutsche Bank AG and Morgan Guaranty Trust Company of
               New York, as Lenders, and Citibank, N.A., as Agent.

99.2           Commitment  Letter,  dated as of October 9, 1998,  by Banque
               Nationale de Paris, Barclays Capital, the investment banking
               division  of Barclays  Bank PLC,  Deutsche  Bank  Securities
               Inc., J.P. Morgan  Securities Inc.,  NationsBanc  Montgomery
               Securities LLC and Salomon Smith Barney Inc.

                                                            EXHIBIT 99.1

                                                              EXECUTION COPY

                             U.S. $900,000,000

                     364-DAY BACKSTOP CREDIT AGREEMENT

                        Dated as of October 9, 1998

                                   Among

                             ALLIEDSIGNAL INC.,

                                as Borrower,
                                ------------

                                    and

                     THE INITIAL LENDERS NAMED HEREIN,

                            as Initial Lenders,
                            -------------------

                                    and

                              CITIBANK, N.A.,

                                  as Agent
                                  --------

                                    and

                         BANQUE NATIONALE DE PARIS
                              BARCLAYS CAPITAL
                       DEUTSCHE BANK SECURITIES INC.
                        J.P. MORGAN SECURITIES INC.
                    NATIONSBANK MONTGOMERY SECURITY LLC
                                    and
                         SALOMON SMITH BARNEY INC.

                                as Arrangers
                                ------------

                             TABLE OF CONTENTS

                                                                         PAGE

                 ARTICLE I DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01.  Certain Defined Terms                                       1
SECTION 1.02.  Computation of Time Periods                                 18
SECTION 1.03.  Accounting Terms                                            18

                ARTICLE II AMOUNTS AND TERMS OF THE ADVANCES
SECTION 2.01.  The Revolving Credit Advances                               18
SECTION 2.02.  Making the Revolving Credit Advances                        19
SECTION 2.03.  The Competitive Bid Advances                                21
SECTION 2.04.  Fees                                                        26
SECTION 2.05.  Termination or Reduction of the Commitments                 27
SECTION 2.06.  Repayment of Advances                                       29
SECTION 2.07.  Interest on Revolving Credit Advances                       30
SECTION 2.08.  Interest Rate Determination                                 30
SECTION 2.09.  Prepayments of Revolving Credit Advances                    32
SECTION 2.10.  Increased Costs                                             33
SECTION 2.11.  Illegality                                                  34
SECTION 2.12.  Payments and Computations                                   35
SECTION 2.13.  Taxes                                                       36
SECTION 2.14.  Sharing of Payments, Etc.                                   39
SECTION 2.15.  Use of Proceeds                                             40
SECTION 2.16.  Extension of Termination Date                               40
SECTION 2.17.  Evidence of Debt                                            42

            ARTICLE III CONDITIONS TO EFFECTIVENESS AND LENDING
SECTION 3.01.  Conditions Precedent to Effectiveness of Sections 
               2.01 and 2.03                                               43
SECTION 3.02.  Initial Loan to Each Designated Subsidiary                  44
SECTION 3.03.  Conditions Precedent to Each Revolving Credit Borrowing     45
SECTION 3.04.  Conditions Precedent to Each Competitive Bid Borrowing      46
SECTION 3.05.  Determinations Under Section 3.01                           47

                 ARTICLE IV REPRESENTATIONS AND WARRANTIES
SECTION 4.01.  Representations and Warranties of the Company               47

                    ARTICLE V COVENANTS OF THE BORROWER
SECTION 5.01.  Affirmative Covenants                                       50
SECTION 5.02.  Negative Covenants                                          54

                        ARTICLE VI EVENTS OF DEFAULT
SECTION 6.01.  Events of Default                                           56

                           ARTICLE VII GUARANTEE
SECTION 7.01.  Unconditional Guarantee                                     61
SECTION 7.02.  Guarantee Absolute                                          61
SECTION 7.03.  Waivers                                                     62
SECTION 7.04.  Remedies                                                    62
SECTION 7.05.  No Stay                                                     63
SECTION 7.06.  Survival                                                    63

                           ARTICLE VIII THE AGENT
SECTION 8.01.  Authorization and Action                                    63
SECTION 8.02.  Agent's Reliance, Etc.                                      64
SECTION 8.03.  Citibank and Affiliates                                     64
SECTION 8.04.  Lender Credit Decision                                      65
SECTION 8.05.  Indemnification                                             65
SECTION 8.06.  Successor Agent                                             65
SECTION 8.07.  Sub-Agent                                                   66

                          ARTICLE IX MISCELLANEOUS
SECTION 9.01.  Amendments, Etc.                                            66
SECTION 9.02.  Notices, Etc.66
SECTION 9.03.  No Waiver; Remedies                                         67
SECTION 9.04.  Costs and Expenses                                          67
SECTION 9.05.  Right of Set-off                                            68
SECTION 9.06.  Binding Effect                                              69
SECTION 9.07.  Assignments and Participations                              69
SECTION 9.08.  Designated Subsidiaries                                     72
SECTION 9.09.  Confidentiality                                             72
SECTION 9.10.  Mitigation of Yield Protection                              73
SECTION 9.11.  Governing Law.                                              73
SECTION 9.12.  Execution in Counterparts                                   73
SECTION 9.13.  Jurisdiction, Etc.                                          73
SECTION 9.14.  Substitution of Currency                                    74
SECTION 9.15.  Final Agreement                                             75
SECTION 9.16.  Judgment                                                    75
SECTION 9.17.  Waiver of Jury Trial                                        75

SCHEDULES

Schedule I - List of Applicable Lending Offices

Schedule 3.01(b) - Disclosed Litigation

EXHIBITS

Exhibit A-1 -  Form of Revolving Credit Note

Exhibit A-2 -  Form of Competitive Bid Note

Exhibit B-1 -  Form of Notice of Revolving Credit Borrowing

Exhibit B-2 -  Form of Notice of Competitive Bid Borrowing

Exhibit C   -  Form of Assignment and Acceptance

Exhibit D   -  Form of Assumption Agreement

Exhibit E   -  Form of Designation Letter

Exhibit F   -  Form of Acceptance by Process Agent

Exhibit G   -  Form of Opinion of J. Edward Smith, Senior Counsel 
               of the Company

Exhibit H   -  Form of Opinion of Counsel to a Designated Subsidiary

Exhibit I   -  Form of Opinion of Shearman & Sterling, Counsel to the Agent

                     364-DAY BACKSTOP CREDIT AGREEMENT

                        Dated as of October 9, 1998

          ALLIEDSIGNAL  INC., a Delaware  corporation (the "Company"),  the
banks, financial institutions and other institutional lenders (the "Initial
Lenders")  listed  on  the  signature  pages  hereof,  and  CITIBANK,  N.A.
("Citibank"),  as agent  (the  "Agent")  for the  Lenders  (as  hereinafter
defined), agree as follows:

                                 ARTICLE I

                      DEFINITIONS AND ACCOUNTING TERMS

          SECTION 1.01.  Certain  Defined Terms. As used in this Agreement,
the following terms shall have the following  meanings (such meanings to be
equally  applicable  to both the  singular  and  plural  forms of the terms
defined):

          "Advance"  means a Revolving  Credit Advance or a Competitive Bid
     Advance.

          "Affiliate"  means,  as to any  Person,  any other  Person  that,
     directly or indirectly,  controls, is controlled by or is under common
     control  with such Person or is a director or officer of such  Person.
     For purposes of this  definition,  the term  "control"  (including the
     terms "controlling",  "controlled by" and "under common control with")
     of a Person means the possession,  direct or indirect, of the power to
     direct or cause the direction of the  management  and policies of such
     Person,  whether through the ownership of Voting Stock, by contract or
     otherwise.

          "Agent's  Account" means (a) in the case of Advances  denominated
     in  Dollars,  the  account  of the  Agent  maintained  by the Agent at
     Citibank at its office at 399 Park Avenue,  New York,  New York 10043,
     Account No.  36852248,  Attention:  Kent  Leonard,  (b) in the case of
     Advances  denominated  in any  Foreign  Currency,  the  account of the
     Sub-Agent  designated in writing from time to time by the Agent to the
     Company  and the  Lenders  for such  purpose and (c) in any such case,
     such other  account of the Agent as is designated in writing from time
     to time by the Agent to the Company and the Lenders for such purpose.

          "Alternate Currency" means any lawful currency other than Dollars
     and the Major Currencies that is freely  transferrable and convertible
     into Dollars.

          "Applicable  Lending Office" means,  with respect to each Lender,
     such  Lender's  Domestic  Lending  Office  in the case of a Base  Rate
     Advance and such Lender's Eurocurrency Lending Office in the case of a
     Eurocurrency  Rate  Advance  and,  in the  case of a  Competitive  Bid
     Advance,  the office of such  Lender  notified  by such  Lender to the
     Agent  as  its   Applicable   Lending  Office  with  respect  to  such
     Competitive Bid Advance.

          "Applicable Margin" means, as of any date, a percentage per annum
     determined  by  reference  to the Public Debt Rating in effect on such
     date as set forth below:

================================================================================
Public Debt Rating       Applicable Margin for         Applicable Margin for
    S&P/Moody's       Eurocurrency Rate Advances    Eurocurrency Rate Advances
                        Prior to the Term Loan     from the Term Loan Conversion
                            Conversion Date                    Date
================================================================================
Level 1                             0.170%                          0.225%
- -------
A/A2

Level 2                             0.205%                          0.275%
- -------
Lower than A/A2
but at least A-/A3

Level 3                             0.265%                          0.350%
- -------
Lower than A-/A3 but
at least BBB+/Baa1

Level 4                             0.305%                          0.400%
- -------
Lower than BBB+/Baa1
but at least BBB/Baa2

Level 5                             0.405%                          0.525%
- -------
Lower than BBB/Baa2
but at least BBB-/Baa3

Level 6                             0.500%                          0.700%
- -------
Lower than BBB-/Baa3

          "Applicable  Percentage"  means, as of any date, a percentage per
     annum  determined  by reference to the Public Debt Rating in effect on
     such date as set forth below:

                     ========================== ========================
                        Public Debt Rating            Applicable
                            S&P/Moody's               Percentage
                     ========================== ========================
                     Level 1                            0.055%
                     -------
                     A/A2

                     Level 2                            0.070%
                     -------
                     Lower than A/A2
                     but at least A-/A3

                     Level 3                            0.085%
                     -------
                     Lower than A-/A3 but at
                     least BBB+/Baa1

                     Level 4                            0.095%
                     -------
                     Lower than BBB+/Baa1
                     but at least BBB/Baa2

                     Level 5                            0.120%
                     -------
                     Lower than BBB/Baa2
                     but at least BBB-/Baa3

                     Level 6                            0.200%
                     -------
                     Lower than BBB-/Baa3

     "Applicable  Utilization  Fee"  means,  as of any  date on  which  the
Utilization in effect is greater than or equal to 33 1/3%, a percentage per
annum determined by reference to the Public Debt Rating and the Utilization
in effect on such date as set forth:

               ================================================================
                                           Utilization     
                 Public Debt Rating        33% and                Utilization
                    S&P/Moody's           (Less than) 66%           66%
               ================================================================
               Level 1                        0.000%                 0.025%
               -------
               A/A2

               Level 2                        0.025%                 0.050%
               -------
               Lower than A/A2
               but at least A-/A3

               Level 3                        0.025%                 0.050%
               -------
               Lower than A-/A3 but
               at least BBB+/Baa1

               Level 4                        0.050%                 0.100%
               -------
               Below BBB+/Baa1
               but at least BBB/Baa2

               Level 5                        0.050%                 0.100%
               -------
               Below BBB/Baa2
               but at least BBB-/Baa3

               Level 6                        0.050%                 0.175%
               -------
               Lower than BBB-/Baa3

          "Assignment  and  Acceptance"  means an assignment and acceptance
     entered into by a Lender and an Eligible Assignee, and accepted by the
     Agent, in substantially the form of Exhibit C hereto.

          "Assuming  Lender"  means an Eligible  Assignee not  previously a
     Lender that becomes a Lender hereunder pursuant to Section 2.16.

          "Assumption  Agreement" means an agreement in  substantially  the
     form of  Exhibit  D hereto  by which an  Eligible  Assignee  agrees to
     become a Lender  hereunder  pursuant  to  Section  2.16,  in each case
     agreeing to be bound by all obligations of a Lender hereunder.

          "Base Rate" means a fluctuating interest rate per annum in effect
     from time to time, which rate per annum shall at all times be equal to
     the highest of:

               (a) the rate of interest  announced  publicly by Citibank in
          New York, New York, from time to time, as Citibank's base rate;

               (b) the sum (adjusted to the nearest 1/16 of 1% or, if there
          is no nearest  1/16 of 1%, to the next  higher 1/16 of 1%) of (i)
          1/2 of 1% per annum,  plus (ii) the rate obtained by dividing (A)
          the latest  three-week moving average of secondary market morning
          offering rates in the United States for three-month  certificates
          of  deposit of major  United  States  money  market  banks,  such
          three-week moving average (adjusted to the basis of a year of 360
          days) being determined  weekly on each Monday (or, if such day is
          not a Business Day, on the next succeeding  Business Day) for the
          three-week  period  ending on the previous  Friday by Citibank on
          the  basis of such  rates  reported  by  certificate  of  deposit
          dealers to and published by the Federal  Reserve Bank of New York
          or, if such publication shall be suspended or terminated,  on the
          basis of  quotations  for such rates  received by  Citibank  from
          three New York  certificate  of  deposit  dealers  of  recognized
          standing selected by Citibank,  by (B) a percentage equal to 100%
          minus the average of the daily percentages  specified during such
          three-week  period  by the  Board  of  Governors  of the  Federal
          Reserve  System (or any successor)  for  determining  the maximum
          reserve   requirement   (including,   but  not  limited  to,  any
          emergency,  supplemental or other marginal  reserve  requirement)
          for  Citibank  with  respect  to  liabilities  consisting  of  or
          including   (among   other   liabilities)    three-month   Dollar
          non-personal  time deposits in the United States,  plus (iii) the
          average during such  three-week  period of the annual  assessment
          rates  estimated  by Citibank  for  determining  the then current
          annual  assessment  payable by Citibank  to the  Federal  Deposit
          Insurance  Corporation  (or any  successor)  for insuring  Dollar
          deposits of Citibank in the United States; and

               (c) 1/2 of one percent  per annum  above the  Federal  Funds
          Rate.

          "Base Rate Advance" means a Revolving Credit Advance  denominated
     in Dollars that bears interest as provided in Section 2.07(a)(i).

          "Borrower" means the Company or any Designated Subsidiary, as the
     context requires.

          "Borrowing"  means a Revolving  Credit Borrowing or a Competitive
     Bid Borrowing.

          "Business  Day"  means a day of the year on which  banks  are not
     required  or  authorized  by law to close in New York City and, if the
     applicable  Business Day relates to any  Eurocurrency  Rate Advance or
     LIBO Rate  Advance,  on which  dealings  are  carried on in the London
     interbank  market and banks are open for business in London and in the
     country of issue of the currency of such  Eurocurrency Rate Advance or
     LIBO Rate  Advance (or, in the case of an Advance  denominated  in the
     euro,  in  Frankfurt,  Germany)  and, if the  applicable  Business Day
     relates  to any  Local  Rate  Advance,  on  which  banks  are open for
     business  in the  country of issue of the  currency of such Local Rate
     Advance.

          "Change of Control" means that (i) any Person or group of Persons
     (within the meaning of Section 13 or 14 of the Securities Exchange Act
     of  1934,  as  amended  (the  "Act"))  (other  than the  Company,  any
     Subsidiary  of the Company or any  savings,  pension or other  benefit
     plan for the benefit of employees of the Company or its  Subsidiaries)
     which theretofore beneficially owned less than 30% of the Voting Stock
     of  the  Company  then  outstanding  shall  have  acquired  beneficial
     ownership  (within  the  meaning  of  Rule  13d-3  promulgated  by the
     Securities  and Exchange  Commission  under the Act) of 30% or more in
     voting  power of the  outstanding  Voting Stock of the Company or (ii)
     during any period of twelve consecutive  calendar months,  individuals
     who at the beginning of such twelve-month period were directors of the
     Company shall cease to constitute a majority of the Board of Directors
     of the Company.

          "Commitment"  means as to any Lender  (i) the  Dollar  amount set
     forth  opposite its name on the signature  pages hereof,  (ii) if such
     Lender  has  become  a  Lender  hereunder  pursuant  to an  Assumption
     Agreement,  the  Dollar  amount  set forth as its  Commitment  in such
     Assumption  Agreement  or (iii) if such  Lender has  entered  into any
     Assignment and Acceptance, the Dollar amount set forth for such Lender
     in the Register  maintained by the  Administrative  Agent  pursuant to
     Section  9.07(d),  in  each  case as the  same  may be  terminated  or
     reduced, as the case may be, pursuant to Section 2.05.

          "Competitive  Bid  Advance"  means an  advance by a Lender to any
     Borrower as part of a  Competitive  Bid Borrowing  resulting  from the
     competitive  bidding procedure described in Section 2.03 and refers to
     a Fixed Rate  Advance,  a LIBO Rate  Advance  or a Local Rate  Advance
     (each of which shall be a "Type" of Competitive Bid Advance).

          "Competitive  Bid  Borrowing"  means a  borrowing  consisting  of
     simultaneous  Competitive  Bid Advances from each of the Lenders whose
     offer to make one or more  Competitive  Bid  Advances  as part of such
     borrowing has been accepted under the  competitive  bidding  procedure
     described in Section 2.03.

          "Competitive  Bid Note" means a  promissory  note of any Borrower
     payable  to the  order of any  Lender,  in  substantially  the form of
     Exhibit A-2 hereto,  evidencing the  indebtedness  of such Borrower to
     such Lender  resulting  from a  Competitive  Bid Advance  made by such
     Lender to such Borrower.

          "Competitive Bid Reduction" has the meaning  specified in Section
     2.01.

          "Consenting   Lenders"  has  the  meaning  specified  in  Section
     2.16(b).

          "Consolidated"   refers  to  the  consolidation  of  accounts  in
     accordance with GAAP.

          "Consolidated  Subsidiary" means, at any time, any Subsidiary the
     accounts  of which  are  required  at that  time to be  included  on a
     Consolidated  basis in the  Consolidated  financial  statements of the
     Company,  assuming  that such  financial  statements  are  prepared in
     accordance with GAAP.

          "Convert",   "Conversion"   and  "Converted"  each  refers  to  a
     conversion  of Revolving  Credit  Advances of one Type into  Revolving
     Credit Advances of the other Type pursuant to Section 2.08.

          "Debt" means,  with respect to any Person:  (i)  indebtedness  of
     such Person,  which is not limited as to recourse to such Person,  for
     borrowed  money  (whether  by loan or the  issuance  and  sale of debt
     securities)  or for the  deferred  (for 90 days or more)  purchase  or
     acquisition  price of  property  or  services;  (ii)  indebtedness  or
     obligations  of others  which such Person has  assumed or  guaranteed;
     (iii)  indebtedness or obligations of others secured by a lien, charge
     or  encumbrance  on property of such Person whether or not such Person
     shall have assumed such indebtedness or obligations;  (iv) obligations
     of such Person in respect of letters of credit (other than performance
     letters of credit,  except to the extent  backing an obligation of any
     Person which would be Debt of such Person),  acceptance facilities, or
     drafts or similar  instruments  issued or  accepted by banks and other
     financial  institutions  for  the  account  of  such  Person;  and (v)
     obligations  of such  Person  under  leases  which are  required to be
     capitalized on a balance sheet of such Person in accordance with GAAP.

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

          "Designated  Subsidiary"  means any  corporate  Subsidiary of the
     Company  designated  for  borrowing  privileges  under this  Agreement
     pursuant to Section 9.08.

          "Designation  Letter"  means,  with  respect  to  any  Designated
     Subsidiary,  a letter in the form of  Exhibit E hereto  signed by such
     Designated Subsidiary and the Company.

          "Disclosed  Litigation"  has the  meaning  specified  in  Section
     3.01(b).

          "Dollars"  and the "$" sign each mean lawful  money of the United
     States of America.

          "Domestic  Lending  Office"  means,  with  respect to any Initial
     Lender,  the office of such Lender specified as its "Domestic  Lending
     Office"  opposite  its name on Schedule I hereto and,  with respect to
     any other Lender, the office of such Lender specified as its "Domestic
     Lending  Office" in the Assumption  Agreement or in the Assignment and
     Acceptance  pursuant to which it became a Lender, or such other office
     of such  Lender as such  Lender  may from time to time  specify to the
     Company and the Agent.

          "Domestic  Subsidiary"  means any Subsidiary whose operations are
     conducted  primarily in the United  States  excluding  any  Subsidiary
     whose  assets  consist  primarily of the stock of  Subsidiaries  whose
     operations are conducted outside the United States of America.

          "Effective Date" has the meaning specified in Section 3.01.

          "Eligible  Assignee"  means (i) a Lender;  (ii) an Affiliate of a
     Lender; (iii) a commercial bank organized under the laws of the United
     States,  or any State  thereof,  and having  total assets in excess of
     $10,000,000,000;  (iv) a savings and loan  association or savings bank
     organized  under the laws of the United States,  or any State thereof,
     and  having  a net  worth  of at  least  $500,000,000,  calculated  in
     accordance  with GAAP; (v) a commercial  bank organized under the laws
     of any other country that is a member of the Organization for Economic
     Cooperation   and   Development  or  has  concluded   special  lending
     arrangements with the International  Monetary Fund associated with its
     General Arrangements to Borrow, or a political subdivision of any such
     country, and having total assets in excess of $10,000,000,000, so long
     as such bank is acting  through  a branch  or  agency  located  in the
     country in which it is organized or another  country that is described
     in this clause (v); and (vi) the central bank of any country that is a
     member of the Organization for Economic Cooperation and Development.

          "Environmental  Action" means any action,  suit,  demand,  demand
     letter,  claim,  notice  of  non-compliance  or  violation,  notice of
     liability or potential liability,  investigation,  proceeding, consent
     order or consent  agreement  relating in any way to any  Environmental
     Law,  Environmental  Permit or  Hazardous  Materials  or arising  from
     alleged  injury  or  threat  of  injury  to  health,   safety  or  the
     environment, including, without limitation, (a) by any governmental or
     regulatory  authority for  enforcement,  cleanup,  removal,  response,
     remedial or other  actions or damages and (b) by any  governmental  or
     regulatory  authority  or any third party for  damages,  contribution,
     indemnification, cost recovery, compensation or injunctive relief.

          "Environmental  Law" means any federal,  state,  local or foreign
     statute,  law, ordinance,  rule,  regulation,  code, order,  judgment,
     decree or  judicial  or  agency  interpretation,  policy  or  guidance
     relating to pollution or protection of the environment, health, safety
     or natural resources, including, without limitation, those relating to
     the  use,  handling,  transportation,  treatment,  storage,  disposal,
     release or discharge of Hazardous Materials.

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

          "Equivalent" in Dollars of any Foreign Currency on any date means
     the equivalent in Dollars of such Foreign Currency determined by using
     the  quoted  spot rate at which the  Sub-Agent's  principal  office in
     London offers to exchange  Dollars for such Foreign Currency in London
     prior to 4:00 P.M.  (London time) (unless  otherwise  indicated by the
     terms of this  Agreement) on such date as is required  pursuant to the
     terms of this Agreement,  and the "Equivalent" in any Foreign Currency
     of Dollars means the  equivalent  in such Foreign  Currency of Dollars
     determined  by using the  quoted  spot  rate at which the  Sub-Agent's
     principal  office in London offers to exchange  such Foreign  Currency
     for  Dollars  in  London  prior to 4:00  P.M.  (London  time)  (unless
     otherwise indicated by the terms of this Agreement) on such date as is
     required pursuant to the terms of this Agreement.

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

          "ERISA  Affiliate"  of any Person means any other Person that for
     purposes of Title IV of ERISA is a member of such Person's  controlled
     group, or under common control with such Person, within the meaning of
     Section 414 of the Internal Revenue Code.

          "ERISA  Event"  with  respect  to any  Person  means  (a) (i) the
     occurrence of a reportable  event,  within the meaning of Section 4043
     of ERISA,  with respect to any Plan of such Person or any of its ERISA
     Affiliates  unless the 30-day notice  requirement with respect to such
     event  has  been  waived  by the  PBGC,  or (ii) the  requirements  of
     subsection  (1)  of  Section  4043(b)  of  ERISA  (without  regard  to
     subsection (2) of such Section) are met with a  contributing  sponsor,
     as defined in Section  4001(a)(13) of ERISA,  of a Plan of such Person
     or any of its ERISA  Affiliates,  and an event  described in paragraph
     (9),  (10),  (11),  (12)  or (13)  of  Section  4043(c)  of  ERISA  is
     reasonably  expected  to occur with  respect  to such Plan  within the
     following 30 days; (b) the  application  for a minimum  funding waiver
     with respect to a Plan of such Person or any of its ERISA  Affiliates;
     (c) the provision by the  administrator  of any Plan of such Person or
     any of its ERISA  Affiliates  of a notice of intent to terminate  such
     Plan in a distress termination pursuant to Section 4041(a)(2) of ERISA
     (including any such notice with respect to a plan  amendment  referred
     to in Section 4041(e) of ERISA);  (d) the cessation of operations at a
     facility  of  such  Person  or  any  of its  ERISA  Affiliates  in the
     circumstances   described  in  Section  4062(e)  of  ERISA;   (e)  the
     withdrawal  by  such  Person  or any of its  ERISA  Affiliates  from a
     Multiple  Employer  Plan  during  a  plan  year  for  which  it  was a
     substantial  employer,  as defined in Section 4001(a)(2) of ERISA; (f)
     the  conditions  for the  imposition of a lien under Section 302(f) of
     ERISA  shall have been met with  respect to any Plan of such Person or
     any of its ERISA  Affiliates;  (g) the  adoption of an  amendment to a
     Plan of such  Person  or any of its  ERISA  Affiliates  requiring  the
     provision  of security to such Plan  pursuant to Section 307 of ERISA;
     or (h) the  institution by the PBGC of proceedings to terminate a Plan
     of such Person or any of its ERISA Affiliates pursuant to Section 4042
     of ERISA,  or the  occurrence  of any event or condition  described in
     Section 4042 of ERISA that constitutes grounds for the termination of,
     or the appointment of a trustee to administer, such Plan.

          "Escrow" means an escrow  established with an independent  escrow
     agent pursuant to an escrow agreement reasonably  satisfactory in form
     and substance to the Person or Persons asserting the obligation of one
     or more Borrowers to make a payment to it or them hereunder.

          "Eurocurrency  Lending Office" means, with respect to any Initial
     Lender,  the  office of such  Lender  specified  as its  "Eurocurrency
     Lending  Office"  opposite  its name on  Schedule I hereto  and,  with
     respect to any other  Lender,  the office of such Lender  specified as
     its  "Eurocurrency  Lending Office" in the Assumption  Agreement or in
     the  Assignment  and  Acceptance  pursuant to which it became a Lender
     (or, if no such office is specified,  its Domestic Lending Office), or
     such other  office of such Lender as such Lender may from time to time
     specify to the Company and the Agent.

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

          "Eurocurrency  Rate"  means,  for any  Interest  Period  for each
     Eurocurrency Rate Advance comprising part of the same Revolving Credit
     Borrowing,  an  interest  rate per  annum  equal to the rate per annum
     obtained  by  dividing  (a) the rate per annum  (rounded  upwards,  if
     necessary,  to the nearest  1/100 of 1%)  appearing on the  applicable
     Telerate  Page as the London  interbank  offered  rate for deposits in
     Dollars or in the relevant Major Currency at approximately  11:00 A.M.
     (London  time)  two  Business  Days  prior  to the  first  day of such
     Interest  Period for a term  comparable to such Interest Period or, if
     for any reason such rate is not available, the average (rounded upward
     to the nearest whole multiple of 1/16 of 1% per annum, if such average
     is not such a  multiple)  of the rate per annum at which  deposits  in
     Dollars or in the relevant Major Currency are offered by the principal
     office of each of the  Reference  Banks in  London,  England  to prime
     banks in the London  interbank  market at 11:00 A.M. (London time) two
     Business  Days  before  the  first day of such  Interest  Period in an
     amount  substantially equal to such Reference Bank's Eurocurrency Rate
     Advance  comprising  part of such  Revolving  Credit  Borrowing  to be
     outstanding during such Interest Period and for a period equal to such
     Interest  Period  by  (b)  a  percentage   equal  to  100%  minus  the
     Eurocurrency Rate Reserve  Percentage for such Interest Period. If the
     Telerate Page is unavailable,  the Eurocurrency  Rate for any Interest
     Period for each Eurocurrency Rate Advance  comprising part of the same
     Revolving  Credit  Borrowing  shall be  determined by the Agent on the
     basis of applicable  rates furnished to and received by the Agent from
     the  Reference  Banks two  Business  Days before the first day of such
     Interest Period, subject, however, to the provisions of Section 2.08.

          "Eurocurrency Rate Advance" means a Revolving Credit Advance
     denominated in Dollars or in a Major Currency that bears interest as
     provided in Section 2.07(a)(ii).

          "Eurocurrency  Rate Reserve  Percentage"  for any Interest Period
     for all  Eurocurrency  Rate Advances or LIBO Rate Advances  comprising
     part of the same Borrowing means the reserve percentage applicable two
     Business  Days  before  the first day of such  Interest  Period  under
     regulations  issued from time to time by the Board of Governors of the
     Federal  Reserve System (or any successor) for determining the maximum
     reserve requirement  (including,  without  limitation,  any emergency,
     supplemental or other marginal reserve  requirement) for a member bank
     of the  Federal  Reserve  System  in New York  City  with  respect  to
     liabilities  or  assets   consisting  of  or  including   Eurocurrency
     Liabilities (or with respect to any other category of liabilities that
     includes   deposits  by  reference  to  which  the  interest  rate  on
     Eurocurrency Rate Advances or LIBO Rate Advances is determined) having
     a term equal to such Interest Period.

          "Events of Default" has the meaning specified in Section 6.01.

          "Extension Date" has the meaning specified in Section 2.16(a).

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

          "Fixed  Rate  Advance"  has  the  meaning  specified  in  Section
     2.03(a)(i),  which Advance shall be  denominated  in Dollars or in any
     Foreign Currency.

          "Foreign  Currency"  means any Major  Currency  or any  Alternate
     Currency.

          "GAAP" has the meaning specified in Section 1.03.

          "Hazardous Materials" means (a) petroleum and petroleum products,
     byproducts    or   breakdown    products,    radioactive    materials,
     asbestos-containing materials, polychlorinated biphenyls and radon gas
     and (b) any  other  chemicals,  materials  or  substances  designated,
     classified  or  regulated  as  hazardous or toxic or as a pollutant or
     contaminant under any Environmental Law.

          "Insufficiency"  means,  with respect to any Plan, the amount, if
     any,  of its  unfunded  benefit  liabilities,  as  defined  in Section
     4001(a)(18) of ERISA.

          "Interest  Period"  means,  for each  Eurocurrency  Rate  Advance
     comprising part of the same Revolving  Credit  Borrowing and each LIBO
     Rate Advance  comprising  part of the same  Competitive Bid Borrowing,
     the period commencing on the date of such Eurocurrency Rate Advance or
     LIBO  Rate  Advance  or the date of the  Conversion  of any Base  Rate
     Advance into such Eurocurrency Rate Advance and ending on the last day
     of the period  selected  by the  Borrower  requesting  such  Borrowing
     pursuant to the  provisions  below and,  thereafter,  with  respect to
     Eurocurrency  Rate Advances,  each subsequent period commencing on the
     last day of the  immediately  preceding  Interest Period and ending on
     the last day of the period  selected by such Borrower  pursuant to the
     provisions  below.  The duration of each such Interest Period shall be
     one, two,  three or six months and, if available to all Lenders,  nine
     months,  as the Borrower  requesting  the  Borrowing  may, upon notice
     received  by the Agent not later than 11:00 A.M.  (New York City time)
     on the third  Business  Day  prior to the  first day of such  Interest
     Period, select; provided, however, that:

                    (i) such  Borrower may not select any  Interest  Period
          that  ends  after  the  scheduled  Termination  Date  or,  if the
          Revolving  Credit  Advances  have been  converted  to a term loan
          pursuant to Section 2.06 prior to such selection, that ends after
          the Maturity Date;

                    (ii) Interest  Periods  commencing on the same date for
          Eurocurrency Rate Advances  comprising part of the same Revolving
          Credit Borrowing or for LIBO Rate Advances comprising part of the
          same Competitive Bid Borrowing shall be of the same duration;

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

                    (iv)  whenever  the  first day of any  Interest  Period
          occurs on a day of an initial  calendar  month for which there is
          no  numerically  corresponding  day in the  calendar  month  that
          succeeds  such  initial  calendar  month by the  number of months
          equal to the  number  of  months in such  Interest  Period,  such
          Interest  Period  shall  end on the  last  Business  Day of  such
          succeeding calendar month.

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

          "Lenders" means,  collectively,  (i) Initial  Lenders,  (ii) each
     Assuming  Lender that shall become a party hereto  pursuant to Section
     2.16 and (iii) each Eligible Assignee that shall become a party hereto
     pursuant to Section 9.07(a), (b) and (c).

          "LIBO  Rate"  means,  for any  Interest  Period for all LIBO Rate
     Advances  comprising part of the same  Competitive  Bid Borrowing,  an
     interest  rate per  annum  equal to the rate  per  annum  obtained  by
     dividing (a) the rate per annum (rounded upwards, if necessary, to the
     nearest 1/100 of 1%) appearing on the applicable  Telerate Page as the
     London  interbank  offered  rate for  deposits  in  Dollars  or in the
     relevant Foreign  Currency at  approximately  11:00 A.M. (London time)
     two Business Days prior to the first day of such  Interest  Period or,
     if for any reason such rate is not  available,  the  average  (rounded
     upward to the nearest whole multiple of 1/16 of 1% per annum,  if such
     average  is not  such a  multiple)  of the  rate  per  annum  at which
     deposits in Dollars or in the relevant Foreign Currency are offered by
     the principal office of each of the Reference Banks in London, England
     to prime banks in the London  interbank  market at 11:00 A.M.  (London
     time) two Business Days before the first day of such  Interest  Period
     in an  amount  substantially  equal to the  amount  that  would be the
     Reference Banks'  respective  ratable shares of such Borrowing if such
     Borrowing  were to be a Revolving  Credit  Borrowing to be outstanding
     during such  Interest  Period and for a period equal to such  Interest
     Period by (b) a percentage equal to 100% minus the  Eurocurrency  Rate
     Reserve  Percentage for such Interest Period.  If the Telerate Page is
     unavailable,  the LIBO Rate for any Interest Period for each LIBO Rate
     Advance comprising part of the same Competitive Bid Borrowing shall be
     determined by the Agent on the basis of applicable  rates furnished to
     and received by the Agent from the  Reference  Banks two Business Days
     before the first day of such Interest Period, subject, however, to the
     provisions of Section 2.08.

          "LIBO Rate Advance" means a Competitive  Bid Advance  denominated
     in Dollars or in any Foreign  Currency and bearing  interest  based on
     the LIBO Rate.

          "Lien" means any lien,  mortgage,  pledge,  security  interest or
     other charge or encumbrance of any kind.

          "Local Rate Advance" means a Competitive Bid Advance  denominated
     in any Foreign  Currency  sourced from the jurisdiction of issuance of
     such Foreign Currency and bearing interest at a fixed rate.

          "Major Currencies" means lawful currency of the United Kingdom of
     Great  Britain and Northern  Ireland,  lawful  currency of the Federal
     Republic of Germany,  lawful currency of Japan, lawful currency of the
     Republic of France and lawful  currency of the  European  Economic and
     Monetary Union.

          "Majority Lenders" means at any time Lenders holding at least 51%
     of the then  aggregate  principal  amount (based on the  Equivalent in
     Dollars  at such  time)  of the  Revolving  Credit  Advances  owing to
     Lenders, or, if no such principal amount is then outstanding,  Lenders
     having at least 51% of the Commitments.

          "Material  Adverse  Change" means any material  adverse change in
     the  financial  condition or results of  operations of the Company and
     its Consolidated Subsidiaries taken as a whole.

          "Material  Adverse Effect" means a material adverse effect on (a)
     the  financial  condition or results of  operations of the Company and
     its  Consolidated  Subsidiaries  taken as a whole,  (b) the rights and
     remedies of the Agent or any Lender  under this  Agreement or any Note
     or (c) the ability of the Borrowers to perform their obligations under
     this Agreement or any Note.

          "Maturity Date" means the earlier of (a) the first anniversary of
     the  Termination  Date and (b) the date of termination in whole of the
     aggregate Commitments pursuant to Section 2.05 or 6.01.

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

          "Multiemployer Plan" of any Person means a multiemployer plan, as
     defined in Section 4001(a)(3) of ERISA, to which such Person or any of
     its ERISA  Affiliates  is making or  accruing  an  obligation  to make
     contributions, or has within any of the preceding five plan years made
     or accrued an obligation to make contributions.

          "Multiple  Employer  Plan" of any Person means a single  employer
     plan,  as  defined  in  Section  4001(a)(15)  of  ERISA,  that  (a) is
     maintained for employees of such Person or any of its ERISA Affiliates
     and at least one  Person  other  than such  Person or any of its ERISA
     Affiliates  or (b) was so  maintained  and in  respect  of which  such
     Person or any of its  ERISA  Affiliates  could  have  liability  under
     Section  4064 or 4069 of ERISA in the event such plan has been or were
     to be terminated.

          "Net  Tangible  Assets  of  the  Company  and  its   Consolidated
     Subsidiaries",  as at any particular date of determination,  means the
     total amount of assets (less  applicable  reserves and other  properly
     deductible   items)  after   deducting   therefrom   (a)  all  current
     liabilities (excluding any thereof which are by their terms extendible
     or renewable at the option of the obligor  thereon to a time more than
     12  months  after  the time as of which the  amount  thereof  is being
     computed)  and (b) all  goodwill,  trade names,  trademarks,  patents,
     unamortized  debt  discount  and  expense  and other  like  intangible
     assets,  as set forth in the most recent  balance sheet of the Company
     and its  Consolidated  Subsidiaries  and computed in  accordance  with
     GAAP.

          "Non-Consenting  Lender"  has the  meaning  specified  in Section
     2.16(b).

          "Note" means a Revolving Credit Note or a Competitive Bid Note.

          "Notice of Competitive  Bid Borrowing" has the meaning  specified
     in Section 2.03(a).

          "Notice of Revolving Credit  Borrowing" has the meaning specified
     in Section 2.02(a).

          "Obligations" has the meaning specified in Section 7.01(b).

          "Payment Office" means, for any Foreign Currency,  such office of
     Citibank  as shall be from  time to time  selected  by the  Agent  and
     notified by the Agent to the Borrowers and the Lenders.

          "PBGC" means the Pension  Benefit  Guaranty  Corporation  (or any
     successor).

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

          "Plan" means a Single Employer Plan or a Multiple Employer Plan.

          "Process Agent" has the meaning specified in Section 9.13(a).

          "Public Debt Rating"  means,  as of any date,  the highest rating
     that has been most recently announced by either S&P or Moody's, as the
     case may be, for any class of  non-credit  enhanced  long-term  senior
     unsecured  debt issued by the Company.  For purposes of the foregoing,
     (a) if only one of S&P and Moody's  shall have in effect a Public Debt
     Rating, the Applicable Margin, the Applicable  Utilization Fee and the
     Applicable   Percentage  shall  be  determined  by  reference  to  the
     available rating;  (b) if neither S&P nor Moody's shall have in effect
     a  Public  Debt  Rating,   the  Applicable   Margin,   the  Applicable
     Utilization  Fee  and  the  Applicable   Percentage  will  be  set  in
     accordance  with Level 6 under the definition of  "Applicable  Margin,
     "Applicable Utilization Fee" or "Applicable  Percentage",  as the case
     may be; (c) if the ratings  established  by S&P and Moody's shall fall
     within  different  levels,   the  Applicable  Margin,  the  Applicable
     Utilization Fee and the Applicable  Percentage shall be based upon the
     higher rating;  (d) if any rating  established by S&P or Moody's shall
     be changed,  such change  shall be  effective  as of the date on which
     such change is first  announced  publicly by the rating  agency making
     such change; and (e) if S&P or Moody's shall change the basis on which
     ratings  are  established,  each  reference  to the Public Debt Rating
     announced  by S&P or Moody's,  as the case may be,  shall refer to the
     then equivalent rating by S&P or Moody's, as the case may be.

          "Rating   Condition"   has  the  meaning   specified  in  Section
     2.05(c)(ii).

          "Rating  Condition  Notice" has the meaning  specified in Section
     2.05(c)(ii).

          "Reference Banks" means Citibank,  Bank of America NT&SA,  Banque
     Nationale  de Paris,  Barclays  Bank plc,  Deutsche  Bank AG, New York
     Branch and/or Cayman Islands Branch and Morgan  Guaranty Trust Company
     of New York.

          "Register" has the meaning specified in Section 9.07(d).

          "Restricted  Property"  means  (a) any  property  of the  Company
     located  within the United  States of America  that, in the opinion of
     the  Company's  Board  of  Directors,  is  a  principal  manufacturing
     property or (b) any shares of capital stock or Debt of any  Subsidiary
     owning any such property.

          "Revolving  Credit  Advance"  means an advance by a Lender to any
     Borrower as part of a Revolving  Credit Borrowing and refers to a Base
     Rate Advance or a Eurocurrency  Rate Advance (each of which shall be a
     "Type" of Revolving Credit Advance).

          "Revolving  Credit  Borrowing"  means a borrowing  consisting  of
     simultaneous  Revolving  Credit Advances of the same Type made by each
     of the Lenders pursuant to Section 2.01.

          "Revolving  Credit Note" means a promissory  note of any Borrower
     payable to the order of any  Lender,  delivered  pursuant to a request
     made under  Section  2.17 in  substantially  the form of  Exhibit  A-1
     hereto, evidencing the aggregate indebtedness of such Borrower to such
     Lender  resulting  from the  Revolving  Credit  Advances  made by such
     Lender to such Borrower.

          "Sale and Leaseback  Transaction"  means any arrangement with any
     Person (other than the Company or a Subsidiary of the Company),  or to
     which any such  Person is a party,  providing  for the  leasing to the
     Company or to a Subsidiary of the Company owning  Restricted  Property
     for a period of more than three years of any Restricted  Property that
     has  been or is to be  sold  or  transferred  by the  Company  or such
     Subsidiary  to such  Person,  or to any other  Person  (other than the
     Company or a  Subsidiary  of the  Company) to which funds have been or
     are to be  advanced  by such  Person  on the  security  of the  leased
     property.  It is  understood  that  arrangements  pursuant  to Section
     168(f)(8) of the Internal  Revenue  Code of 1954,  as amended,  or any
     successor  provision  having similar  effect,  are not included within
     this definition of "Sale and Leaseback Transaction".

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

          "Single  Employer  Plan" of any  Person  means a single  employer
     plan,  as  defined  in  Section  4001(a)(15)  of  ERISA,  that  (a) is
     maintained for employees of such Person or any of its ERISA Affiliates
     and no Person other than such Person and its ERISA  Affiliates  or (b)
     was so  maintained  and in respect of which such  Person or any of its
     ERISA  Affiliates  could have liability under Section 4069 of ERISA in
     the event such plan has been or were to be terminated.

          "Sub-Agent" means Citibank International plc.

          "Subsidiary"  of any Person means any  corporation,  partnership,
     joint venture, limited liability company, trust or estate of which (or
     in which)  more than 50% of (a) the  issued  and  outstanding  capital
          stock  having  ordinary  voting  power to elect a majority of the
     Board of
     Directors  of such  corporation  (irrespective  of whether at the time
     capital stock of any other class or classes of such corporation  shall
     or might have voting power upon the  occurrence  of any  contingency),
     (b) the interest in the capital or profits of such  limited  liability
     company,  partnership or joint venture or (c) the beneficial  interest
     in such trust or estate is at the time directly or indirectly owned or
     controlled by such Person, by such Person and one or more of its other
     Subsidiaries or by one or more of such Person's other Subsidiaries.

          "Telerate Page" means,  as applicable,  page 3740 or 3750 (or any
     successor   pages,   respectively)   of  Telerate  Service  of  Bridge
     Information Services.

          "Term Loan Conversion  Date" means the Termination  Date on which
     all Advances  outstanding  on such date are converted into a term loan
     pursuant to Section 2.06.

          "Term Loan Election" has the meaning specified in Section 2.06.

          "Termination Date" means the earlier of (a) ___________, 1999, or
     such later date to which it may be extended  pursuant to Section 2.16,
     and (b) the date of termination in whole of the  Commitments  pursuant
     to Section  2.05(a) or (e) or Section 6.01 or, if all Lenders elect to
     terminate their Commitments as provided therein, Section 2.05(d).

          "Threatened"   means,   with   respect  to  any   action,   suit,
     investigation,  litigation or proceeding,  a written  communication to
     the Company or a Designated Subsidiary, as the case may be, expressing
     an intention to immediately  bring such action,  suit,  investigation,
     litigation or proceeding.

          "Utilization"  means,  as of any  time  prior  to the  Term  Loan
     Conversion Date, the decimal fraction equal to the aggregate principal
     amount of the  Advances  then  outstanding  divided  by the  aggregate
     amount of the Lenders' Commitments at such time and, at all times from
     the Term Loan  Conversion  Date,  the  decimal  fraction  equal to the
     aggregate  principal  amount of the Advances  outstanding  on the Term
     Loan Conversion  Date divided by the aggregate  amount of the Lenders'
     Commitments immediately prior to the Term Loan Conversion Date.

          "Voting  Stock" means capital stock issued by a  corporation,  or
     equivalent  interests  in any other  Person,  the holders of which are
     ordinarily, in the absence of contingencies,  entitled to vote for the
     election of directors  (or persons  performing  similar  functions) of
     such  Person,  even if the right so to vote has been  suspended by the
     happening of such a contingency.

          "Withdrawal  Liability"  has the meaning  specified  in Part I of
     Subtitle E of Title IV of ERISA.

          SECTION 1.02.  Computation of Time Periods.  In this Agreement in
the  computation  of  periods  of  time  from a  specified  date to a later
specified  date,  the word "from" means "from and  including" and the words
"to" and "until" each mean "to but excluding".

          SECTION  1.03.   Accounting   Terms.  All  accounting  terms  not
specifically   defined  herein  shall  be  construed,   and  all  financial
computations  and   determinations   pursuant  hereto  shall  be  made,  in
accordance with generally accepted  accounting  principles  consistent with
those applied in the preparation of the financial statements referred to in
Section  4.01(e)  ("GAAP");  provided,  however,  that,  if any  changes in
accounting  principles from those used in the preparation of such financial
statements have been required by the rules, regulations,  pronouncements or
opinions  of the  Financial  Accounting  Standards  Board  or the  American
Institute  of  Certified  Public  Accountants  (or  successors  thereto  or
agencies with similar  functions) and have been adopted by the Company with
the agreement of its independent certified public accountants,  the Lenders
agree to consider a request by the Company to amend this  Agreement to take
account of such changes.

                                 ARTICLE II

                     AMOUNTS AND TERMS OF THE ADVANCES

          SECTION  2.01.  The  Revolving  Credit   Advances.   Each  Lender
severally  agrees,  on the terms and conditions  hereinafter  set forth, to
make  Revolving  Credit  Advances to any Borrower  from time to time on any
Business  Day  during  the  period  from  the  Effective   Date  until  the
Termination  Date in an aggregate amount (based in respect of any Revolving
Credit Advance denominated in a Major Currency on the Equivalent in Dollars
determined  on the date of delivery of the  applicable  Notice of Revolving
Credit  Borrowing),  not to exceed at any time  outstanding  such  Lender's
Commitment,  provided that the aggregate  amount of the  Commitments of the
Lenders  shall  be  deemed  used  from  time to time to the  extent  of the
aggregate   amount  (based  in  respect  of  any  Competitive  Bid  Advance
denominated  in a Foreign  Currency  on the  Equivalent  in Dollars at such
time) of the Competitive Bid Advances then  outstanding and such deemed use
of the aggregate  amount of the  Commitments  shall be allocated  among the
Lenders ratably according to their respective  Commitments (such deemed use
of the  aggregate  amount  of the  Commitments  being  a  "Competitive  Bid
Reduction").  Each  Revolving  Credit  Borrowing  shall be in an  aggregate
amount not less than  $10,000,000  (or the Equivalent  thereof in any Major
Currency  determined  on the date of delivery of the  applicable  Notice of
Revolving Credit  Borrowing) or an integral  multiple of $1,000,000 (or the
Equivalent thereof in any Major Currency determined on the date of delivery
of the applicable  Notice of Revolving Credit  Borrowing) in excess thereof
and shall consist of Revolving Credit Advances of the same Type made on the
same day by the Lenders ratably according to their respective  Commitments;
provided,  however, that if there is no unused portion of the Commitment of
one or more Lenders at the time of any requested Revolving Credit Borrowing
such Borrowing shall consist of Revolving  Credit Advances of the same Type
made on the same day by the  Lender or  Lenders  who do then have an unused
portion of their  Commitments  ratably  according to the unused  portion of
such  Commitments.  Notwithstanding  anything  herein to the  contrary,  no
Revolving Credit Borrowing may be made in a Major Currency if, after giving
effect to the making of such Revolving Credit Borrowing,  the Equivalent in
Dollars of the aggregate  amount of outstanding  Revolving  Credit Advances
denominated in Major Currencies, together with the Equivalent in Dollars of
the aggregate amount of outstanding Competitive Bid Advances denominated in
Foreign Currencies,  would exceed  $200,000,000.  Within the limits of each
Lender's  Commitment,  any Borrower  may borrow  under this  Section  2.01,
prepay pursuant to Section 2.09 and reborrow under this Section 2.01.

          SECTION 2.02.  Making the  Revolving  Credit  Advances.  (a) Each
Revolving  Credit  Borrowing shall be made on notice,  given not later than
(x) 10:00 A.M. (New York City time) on the third  Business Day prior to the
date of the proposed  Revolving Credit Borrowing in the case of a Revolving
Credit Borrowing  consisting of Eurocurrency  Rate Advances  denominated in
any Major  Currency,  (y)  11:00  A.M.  (New  York City  time) on the third
Business Day prior to the date of the proposed  Revolving  Credit Borrowing
in the case of a Revolving Credit Borrowing consisting of Eurocurrency Rate
Advances  denominated  in Dollars or (z) 9:00 A.M.  (New York City time) on
the  day of the  proposed  Revolving  Credit  Borrowing  in the  case  of a
Revolving  Credit  Borrowing  consisting  of  Base  Rate  Advances,  by any
Borrower  to the Agent  (and the Agent  shall,  in the case of a  Revolving
Credit  Borrowing  consisting of  Eurocurrency  Rate Advances,  immediately
relay such notice to the Sub-Agent), which shall give to each Lender prompt
notice  thereof by  telecopier  or telex.  Each such  notice of a Revolving
Credit  Borrowing (a "Notice of Revolving  Credit  Borrowing")  shall be by
telephone,  confirmed  immediately  in writing,  or  telecopier or telex in
substantially  the form of  Exhibit  B-1  hereto,  specifying  therein  the
requested  (i)  date of  such  Revolving  Credit  Borrowing,  (ii)  Type of
Advances comprising such Revolving Credit Borrowing, (iii) aggregate amount
of such  Revolving  Credit  Borrowing,  and (iv) in the case of a Revolving
Credit Borrowing consisting of Eurocurrency Rate Advances, initial Interest
Period and currency for each such  Revolving  Credit  Advance.  Each Lender
shall, before 11:00 A.M. (New York City time) on the date of such Revolving
Credit Borrowing, in the case of a Revolving Credit Borrowing consisting of
Advances denominated in Dollars, and before 11:00 A.M. (London time) on the
date of such Revolving Credit Borrowing,  in the case of a Revolving Credit
Borrowing consisting of Eurocurrency Rate Advances denominated in any Major
Currency,  make available for the account of its Applicable  Lending Office
to the Agent at the applicable  Agent's  account,  in same day funds,  such
Lender's ratable portion (as determined in accordance with Section 2.01) of
such Revolving  Credit  Borrowing.  After the Agent's receipt of such funds
and upon fulfillment of the applicable conditions set forth in Article III,
the Agent will make such funds  available  to the Borrower  requesting  the
Revolving  Credit  Borrowing  at the  Agent's  aforesaid  address or at the
applicable Payment Office, as the case may be.

          (b)   Anything   in   subsection   (a)  above  to  the   contrary
notwithstanding,  a Borrower may not select  Eurocurrency Rate Advances for
any proposed Revolving Credit Borrowing if the obligation of the Lenders to
make Eurocurrency Rate Advances shall then be suspended pursuant to Section
2.08 or 2.11.

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

          (d) Unless the Agent  shall have  received  notice  from a Lender
prior to the date of any Revolving  Credit  Borrowing that such Lender will
not make  available  to the Agent  such  Lender's  ratable  portion of such
Revolving Credit Borrowing,  the Agent may assume that such Lender has made
such portion  available to the Agent on the date of such  Revolving  Credit
Borrowing in accordance  with  subsection  (a) of this Section 2.02 and the
Agent may, in reliance upon such assumption, make available to the Borrower
proposing  such  Revolving  Credit  Borrowing on such date a  corresponding
amount.  If and to the extent that such Lender  shall not have so made such
ratable  portion  available  to the Agent,  such  Lender and such  Borrower
severally   agree  to  repay  to  the  Agent   forthwith   on  demand  such
corresponding  amount together with interest thereon, for each day from the
date such amount is made  available  to such  Borrower  until the date such
amount is repaid to the  Agent,  at (i) in the case of such  Borrower,  the
higher of (A) the interest rate applicable at the time to Revolving  Credit
Advances  comprising  such Revolving  Credit  Borrowing and (B) the cost of
funds  incurred by the Agent in respect of such amount and (ii) in the case
of such  Lender,  (A)  the  Federal  Funds  Rate  in the  case of  Advances
denominated  in Dollars or (B) the cost of funds  incurred  by the Agent in
respect of such  amount in the case of  Advances  denominated  in any Major
Currency.  If such  Lender  shall  repay to the  Agent  such  corresponding
amount,  such amount so repaid shall  constitute  such  Lender's  Revolving
Credit Advance as part of such Revolving  Credit  Borrowing for purposes of
this Agreement.

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

          SECTION  2.03.  The  Competitive  Bid  Advances.  (a) Each Lender
severally  agrees that any Borrower may request  Competitive Bid Borrowings
under this  Section  2.03 from time to time on any  Business Day during the
period from the date hereof  until the date  occurring  seven days prior to
the  Termination  Date  in the  manner  set  forth  below;  provided  that,
following  the making of each  Competitive  Bid  Borrowing,  the  aggregate
amount (based in respect of any Advance  denominated in a Foreign  Currency
on the  Equivalent  in Dollars on such  Business  Day) of the Advances then
outstanding shall not exceed the aggregate amount of the Commitments of the
Lenders  (computed  without  regard  to  any  Competitive  Bid  Reduction).
Notwithstanding  anything  herein  to  the  contrary,  no  Competitive  Bid
Borrowing may be made in a Foreign  Currency if, after giving effect to the
making of such Revolving Credit Borrowing, the Equivalent in Dollars of the
aggregate  amount of outstanding  Competitive  Bid Advances  denominated in
Foreign  Currencies,  together  with  the  Equivalent  in  Dollars  of  the
aggregate amount of outstanding  Revolving  Credit Advances  denominated in
Major Currencies, would exceed $200,000,000.

          (i) Any Borrower may request a Competitive  Bid  Borrowing  under
     this Section 2.03 by delivering to the Agent (and the Agent shall,  in
     the case of a Competitive  Bid Borrowing not  consisting of Fixed Rate
     Advances  or  LIBO  Rate  Advances  to  be   denominated  in  Dollars,
     immediately notify the Sub-Agent), by telecopier or telex, a notice of
     a Competitive Bid Borrowing (a "Notice of Competitive Bid Borrowing"),
     in substantially  the form of Exhibit B-2 hereto,  specifying  therein
     the requested (A) date of such proposed Competitive Bid Borrowing, (B)
     aggregate  amount of such  proposed  Competitive  Bid  Borrowing,  (C)
     interest  rate  basis and day count  convention  to be  offered by the
     Lenders, (D) currency of such proposed Competitive Bid Borrowing,  (E)
     in the case of a  Competitive  Bid  Borrowing  consisting of LIBO Rate
     Advances,  Interest Period of each  Competitive Bid Advance to be made
     as  part  of  such  Competitive  Bid  Borrowing,  or in the  case of a
     Competitive  Bid Borrowing  consisting of Fixed Rate Advances or Local
     Rate Advances,  maturity date for repayment of each Fixed Rate Advance
     or  Local  Rate  Advance  to be made as part of such  Competitive  Bid
     Borrowing  (which  maturity  date  may not be  earlier  than  the date
     occurring five days after the date of such  Competitive  Bid Borrowing
     or later than the  Termination  Date),  (F)  interest  payment date or
     dates relating  thereto,  (G) location of such  Borrower's  account to
     which  funds are to be  advanced,  and (H) other  terms (if any) to be
     applicable to such Competitive Bid Borrowing, not later than (w) 10:00
     A.M.  (New York City time) at least one Business Day prior to the date
     of the proposed  Competitive  Bid  Borrowing,  if such Borrower  shall
     specify in its Notice of  Competitive  Bid Borrowing that the rates of
     interest to be offered by the  Lenders  shall be fixed rates per annum
     (each Advance  comprising  any such  Competitive  Bid Borrowing  being
     referred to herein as a "Fixed Rate  Advance")  and that the  Advances
     comprising   such  proposed   Competitive   Bid  Borrowing   shall  be
     denominated  in Dollars,  (x) 10:00 A.M. (New York City time) at least
     four Business Days prior to the date of the proposed  Competitive  Bid
     Borrowing,  if such Borrower  shall  instead  specify in its Notice of
     Competitive   Bid  Borrowing   that  the  Advances   comprising   such
     Competitive Bid Borrowing  shall be LIBO Rate Advances  denominated in
     Dollars,  (y) 3:00 P.M.  (New York City time) at least three  Business
     Days prior to the date of the proposed  Competitive Bid Borrowing,  if
     such Borrower shall specify in the Notice of Competitive Bid Borrowing
     that the Advances  comprising such proposed  Competitive Bid Borrowing
     shall  be  either  Fixed  Rate  Advances  denominated  in any  Foreign
     Currency or Local Rate Advances  denominated  in any Foreign  Currency
     and (z) 3:00 P.M.  (New York City  time) at least five  Business  Days
     prior to the date of the proposed  Competitive Bid Borrowing,  if such
     Borrower  shall  instead  specify  in its  Notice of  Competitive  Bid
     Borrowing that the Advances  comprising such Competitive Bid Borrowing
     shall be LIBO Rate Advances denominated in any Foreign Currency.  Each
     Notice of Competitive  Bid Borrowing  shall be irrevocable and binding
     on such  Borrower.  Any  Notice  of  Competitive  Bid  Borrowing  by a
     Designated  Subsidiary  shall be given to the Agent in accordance with
     the  preceding   sentence  through  the  Company  on  behalf  of  such
     Designated  Subsidiary.  The Agent shall in turn promptly  notify each
     Lender of each request for a Competitive Bid Borrowing  received by it
     from such Borrower by sending such Lender a copy of the related Notice
     of Competitive Bid Borrowing.

          (ii) Each Lender may, if, in its sole discretion, it elects to do
     so,  irrevocably offer to make one or more Competitive Bid Advances to
     the Borrower  proposing the  Competitive Bid Borrowing as part of such
     proposed  Competitive  Bid  Borrowing  at a rate or rates of  interest
     specified  by such Lender in its sole  discretion,  by  notifying  the
     Agent (which shall give prompt notice  thereof to such Borrower and to
     the  Sub-Agent,  if  applicable),  (A) before 9:30 A.M. (New York City
     time) on the date of such proposed  Competitive Bid Borrowing,  in the
     case of a Competitive Bid Borrowing  consisting of Fixed Rate Advances
     denominated  in Dollars,  (B) before  10:00 A.M.  (New York City time)
     three Business Days before the date of such proposed  Competitive  Bid
     Borrowing,  in the case of a Competitive  Bid Borrowing  consisting of
     LIBO Rate Advances  denominated in Dollars, (C) before 10:00 A.M. (New
     York City time) on the second  Business  Day prior to the date of such
     proposed  Competitive Bid Borrowing,  in the case of a Competitive Bid
     Borrowing  consisting of either Fixed Rate Advances denominated in any
     Foreign  Currency or Local Rate  Advances  denominated  in any Foreign
     Currency and (D) before 10:00 A.M.  (New York City time) four Business
     Days before the date of such proposed  Competitive  Bid Borrowing,  in
     the  case of a  Competitive  Bid  Borrowing  consisting  of LIBO  Rate
     Advances  denominated in any Foreign  Currency,  of the minimum amount
     and maximum amount of each  Competitive  Bid Advance which such Lender
     would be  willing  to make as part of such  proposed  Competitive  Bid
     Borrowing (which amounts, or the Equivalent thereof in Dollars, as the
     case may be, may, subject to the proviso to the first sentence of this
     Section 2.03(a), exceed such Lender's Commitment, if any), the rate or
     rates of interest therefor and such Lender's Applicable Lending Office
     with respect to such  Competitive  Bid Advance;  provided  that if the
     Agent in its capacity as a Lender shall, in its sole discretion, elect
     to make any such offer, it shall notify such Borrower of such offer at
     least 30 minutes  before  the time and on the date on which  notice of
     such election is to be given to the Agent,  by the other  Lenders.  If
     any Lender shall elect not to make such an offer, such Lender shall so
     notify the  Agent,  before  10:00  A.M.  (New York City time) (and the
     Agent shall notify the Sub-Agent,  if applicable) on the date on which
     notice  of such  election  is to be  given to the  Agent by the  other
     Lenders,  and such Lender  shall not be  obligated  to, and shall not,
     make any  Competitive  Bid  Advance  as part of such  Competitive  Bid
     Borrowing; provided that the failure by any Lender to give such notice
     shall not cause such Lender to be  obligated  to make any  Competitive
     Bid Advance as part of such proposed Competitive Bid Borrowing.

          (iii) The Borrower  proposing the  Competitive Bid Advance shall,
     in turn,  (A) before  10:30  A.M.  (New York City time) on the date of
     such proposed Competitive Bid Borrowing,  in the case of a Competitive
     Bid  Borrowing  consisting  of  Fixed  Rate  Advances  denominated  in
     Dollars,  (B) before  11:00 A.M.  (New York City time) three  Business
     Days before the date of such proposed  Competitive  Bid Borrowing,  in
     the  case of a  Competitive  Bid  Borrowing  consisting  of LIBO  Rate
     Advances  denominated in Dollars, (C) before 10:00 A.M. (New York City
     time) on the  Business Day prior to the date of such  Competitive  Bid
     Borrowing,  in the case of a Competitive  Bid Borrowing  consisting of
     either  Fixed Rate  Advances  denominated  in any Foreign  Currency or
     Local Rate Advances denominated in any Foreign Currency and (D) before
     10:00 A.M. (New York City time) three Business Days before the date of
     such proposed Competitive Bid Borrowing,  in the case of a Competitive
     Bid  Borrowing  consisting of LIBO Rate  Advances  denominated  in any
     Foreign Currency, either:

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

                    (y) accept one or more of the offers made by any Lender
          or  Lenders  pursuant  to  paragraph  (ii)  above,  in  its  sole
          discretion,  by giving  notice to the Agent (and the Agent  shall
          give notice to the  Sub-Agent,  if  applicable)  of the amount of
          each  Competitive  Bid Advance (which amount shall be equal to or
          greater  than the minimum  amount,  and equal to or less than the
          maximum amount,  notified to such Borrower by the Agent on behalf
          of such  Lender for such  Competitive  Bid  Advance  pursuant  to
          paragraph  (ii)  above) to be made by each Lender as part of such
          Competitive Bid Borrowing,  and reject any remaining  offers made
          by Lenders  pursuant to paragraph  (ii) above by giving the Agent
          notice to that  effect;  provided,  however,  that such  Borrower
          shall not accept any offer in excess of the  requested bid amount
          for any maturity.  Such Borrower  shall accept the offers made by
          any Lender or Lenders to make  Competitive  Bid Advances in order
          of the lowest to the highest  rates of  interest  offered by such
          Lenders.  If two or more Lenders  have offered the same  interest
          rate,  the amount to be  borrowed at such  interest  rate will be
          allocated  among such  Lenders in  proportion  to the amount that
          each such Lender offered at such interest rate.

          (iv) If the Borrower  proposing  the  Competitive  Bid  Borrowing
     notifies  the Agent that such  Competitive  Bid  Borrowing is canceled
     pursuant  to  paragraph  (iii)(x)  above,  the Agent shall give prompt
     notice thereof to the Lenders and such Competitive Bid Borrowing shall
     not be made.

          (v) If the  Borrower  proposing  the  Competitive  Bid  Borrowing
     accepts  one or  more of the  offers  made by any  Lender  or  Lenders
     pursuant to paragraph (iii)(y) above, the Agent shall in turn promptly
     notify  (A)  each  Lender  that has  made an  offer  as  described  in
     paragraph  (ii)  above,  of the  date  and  aggregate  amount  of such
     Competitive  Bid Borrowing and whether or not any offer or offers made
     by such Lender  pursuant to paragraph (ii) above have been accepted by
     the  Borrower,  (B)  each  Lender  that is to make a  Competitive  Bid
     Advance as part of such  Competitive  Bid Borrowing,  of the amount of
     each Competitive Bid Advance to be made by such Lender as part of such
     Competitive  Bid  Borrowing,  and (C)  each  Lender  that is to make a
     Competitive  Bid Advance as part of such  Competitive  Bid  Borrowing,
     upon receipt, that the Agent has received forms of documents appearing
     to fulfill the  applicable  conditions  set forth in Article III. Each
     Lender  that  is to make a  Competitive  Bid  Advance  as part of such
     Competitive  Bid  Borrowing  shall,  before 11:00 A.M.  (New York City
     time),  in the case of  Competitive  Bid Advances to be denominated in
     Dollars or 11:00 A.M.  (London time),  in the case of Competitive  Bid
     Advances to be  denominated  in any Foreign  Currency,  on the date of
     such  Competitive Bid Borrowing  specified in the notice received from
     the Agent  pursuant  to clause (A) of the  preceding  sentence  or any
     later time when such Lender shall have received  notice from the Agent
     pursuant to clause (C) of the preceding  sentence,  make available for
     the account of its  Applicable  Lending Office to the Agent (x) in the
     case of a Competitive  Bid Borrowing  denominated  in Dollars,  at its
     address referred to in Section 9.02, in same day funds,  such Lender's
     portion of such  Competitive Bid Borrowing in Dollars,  and (y) in the
     case of a  Competitive  Bid  Borrowing in a Foreign  Currency,  at the
     Payment  Office for such Foreign  Currency as shall have been notified
     by the Agent to the Lenders  prior  thereto,  in same day funds,  such
     Lender's  portion of such  Competitive  Bid  Borrowing in such Foreign
     Currency.  Upon fulfillment of the applicable  conditions set forth in
     Article III and after  receipt by the Agent of such  funds,  the Agent
     will make such  funds  available  to such  Borrower's  account  at the
     location  specified by such Borrower in its Notice of Competitive  Bid
     Borrowing.  Promptly  after each  Competitive  Bid Borrowing the Agent
     will  notify  each  Lender  of the  amount  of  such  Competitive  Bid
     Borrowing, the consequent Competitive Bid Reduction and the dates upon
     which such Competitive Bid Reduction commenced and will terminate.

          (vi) If the Borrower  proposing  the  Competitive  Bid  Borrowing
     notifies  the Agent that it accepts  one or more of the offers made by
     any Lender or Lenders  pursuant  to  paragraph  (iii)(y)  above,  such
     notice  of  acceptance  shall  be  irrevocable  and  binding  on  such
     Borrower.  Such Borrower shall indemnify each Lender against any loss,
     cost or expense  incurred by such Lender as a result of any failure by
     such  Borrower  to  fulfill  on or before  the date  specified  in the
     related Notice of Competitive  Bid Borrowing for such  Competitive Bid
     Borrowing  the  applicable   conditions  set  forth  in  Article  III,
     including, without limitation, any loss (including loss of anticipated
     profits),  cost or expense  incurred by reason of the  liquidation  or
     reemployment  of deposits  or other  funds  acquired by such Lender to
     fund the  Competitive Bid Advance to be made by such Lender as part of
     such Competitive Bid Borrowing when such Competitive Bid Advance, as a
     result of such failure, is not made on such date.

          (b) Each  Competitive  Bid  Borrowing  shall  be in an  aggregate
amount not less than $10,000,000 (or the Equivalent  thereof in any Foreign
Currency, determined as of the time of the applicable Notice of Competitive
Bid  Borrowing) or an integral  multiple of $1,000,000  (or the  Equivalent
thereof  in  any  Foreign  Currency,  determined  as of  the  time  of  the
applicable  Notice of  Competitive  Bid  Borrowing) in excess  thereof and,
following the making of each  Competitive Bid Borrowing,  the Borrower that
has borrowed such Competitive Bid Borrowing shall be in compliance with the
limitation set forth in the proviso to the first sentence of subsection (a)
above.

          (c) Within the  limits  and on the  conditions  set forth in this
Section 2.03,  any Borrower may from time to time borrow under this Section
2.03,  repay or prepay pursuant to subsection (d) below, and reborrow under
this Section 2.03,  provided that a Competitive  Bid Borrowing shall not be
made within three  Business Days of the date of any other  Competitive  Bid
Borrowing.

          (d) Any Borrower  that has  borrowed  through a  Competitive  Bid
Borrowing  shall repay to the Agent for the account of each Lender that has
made a Competitive  Bid Advance,  on the maturity date of such  Competitive
Bid Advance (such  maturity date being that  specified by such Borrower for
repayment  of  such  Competitive  Bid  Advance  in the  related  Notice  of
Competitive Bid Borrowing delivered pursuant to subsection (a)(i) above and
provided  in the  Competitive  Bid Note  evidencing  such  Competitive  Bid
Advance), the then unpaid principal amount of such Competitive Bid Advance.
Such  Borrower  shall have no right to prepay any  principal  amount of any
Competitive  Bid Advance unless,  and then only on the terms,  specified by
such  Borrower for such  Competitive  Bid Advance in the related  Notice of
Competitive Bid Borrowing delivered pursuant to subsection (a)(i) above and
set forth in the  Competitive  Bid Note  evidencing  such  Competitive  Bid
Advance.

          (e) Each  Borrower that has borrowed  through a  Competitive  Bid
Borrowing  shall  pay  interest  on the  unpaid  principal  amount  of each
Competitive Bid Advance  comprising such Competitive Bid Borrowing from the
date of such  Competitive  Bid Advance to the date the principal  amount of
such Competitive Bid Advance is repaid in full, at the rate of interest for
such   Competitive  Bid  Advance   specified  by  the  Lender  making  such
Competitive  Bid  Advance  in its notice  with  respect  thereto  delivered
pursuant to subsection (a)(ii) above,  payable on the interest payment date
or dates specified by such Borrower for such Competitive Bid Advance in the
related  Notice  of  Competitive  Bid  Borrowing   delivered   pursuant  to
subsection (a)(i) above, as provided in the Competitive Bid Note evidencing
such   Competitive  Bid  Advance.   Upon  the  occurrence  and  during  the
continuance  of an Event of Default  under Section  6.01(a),  such Borrower
shall pay  interest on the amount of unpaid  principal  of and  interest on
each  Competitive Bid Advance owing to a Lender,  payable in arrears on the
date or dates interest is payable thereon, at a rate per annum equal at all
times to 1% per annum above the rate per annum  required to be paid on such
Competitive  Bid  Advance  under  the  terms  of the  Competitive  Bid Note
evidencing  such  Competitive Bid Advance unless  otherwise  agreed in such
Competitive Bid Note.

          (f)  The  indebtedness  of  any  Borrower   resulting  from  each
Competitive  Bid Advance made to such Borrower as part of a Competitive Bid
Borrowing  shall be  evidenced  by a separate  Competitive  Bid Note of the
Borrower  payable to the order of the Lender  making such  Competitive  Bid
Advance.

          SECTION 2.04.  Fees.  (a) Facility Fee. The Company agrees to pay
to the Agent for the account of each Lender a facility fee on the aggregate
amount of such Lender's Commitment from the date hereof in the case of each
Initial  Lender and from the  effective  date  specified in the  Assumption
Agreement or the Assignment and Acceptance, as the case may be, pursuant to
which it  became  a  Lender  in the case of each  other  Lender  until  the
Termination Date at a rate per annum equal to the Applicable  Percentage in
effect from time to time,  payable in arrears  quarterly on the last day of
each March, June, September and December, commencing December 31, 1998, and
on the Termination Date.

          (b) Agent's Fees.  The Company shall pay to the Agent for its own
account  such fees,  and at such  times,  as the  Company and the Agent may
separately agree.

          SECTION 2.05.  Termination or Reduction of the  Commitments.  (a)
Optional  Ratable  Termination  or  Reduction.  The Company  shall have the
right, upon at least three Business Days' notice to the Agent, to terminate
in whole or reduce  ratably in part the unused  portions of the  respective
Commitments of the Lenders,  provided that each partial  reduction shall be
in an aggregate amount not less than $10,000,000 or an integral multiple of
$1,000,000 in excess thereof and provided further that the aggregate amount
of the Commitments of the Lenders shall not be reduced to an amount that is
less than the sum of the aggregate  principal amount of the Competitive Bid
Advances  denominated  in Dollars then  outstanding  plus the Equivalent in
Dollars  (determined  as of the date of the  notice of  prepayment)  of the
aggregate  principal amount of the Competitive Bid Advances  denominated in
Foreign   Currencies  then   outstanding.   The  aggregate  amount  of  the
Commitments,  once reduced as provided in this Section 2.05(a),  may not be
reinstated.

          (b) Non-Ratable Termination by Assignment. The Company shall have
the right,  upon at least ten Business  Days'  written  notice to the Agent
(which shall then give prompt notice  thereof to the relevant  Lender),  to
require  any  Lender to  assign,  pursuant  to and in  accordance  with the
provisions of Section 9.07,  all of its rights and  obligations  under this
Agreement  and under  the Notes to an  Eligible  Assignee  selected  by the
Company;  provided,  however,  that  (i) no  Event of  Default  shall  have
occurred and be  continuing  at the time of such request and at the time of
such assignment;  (ii) the assignee shall have paid to the assigning Lender
the aggregate  principal  amount of, and any interest accrued and unpaid to
the date of such assignment on, the Note or Notes of such Lender; (iii) the
Company shall have paid to the  assigning  Lender any and all facility fees
and other fees  payable to such  Lender  and all other  accrued  and unpaid
amounts  owing  to such  Lender  under  any  provision  of  this  Agreement
(including,  but not limited to, any  increased  costs or other  additional
amounts  owing under Section 2.10 and any  indemnification  for Taxes under
Section 2.13) as of the effective date of such assignment;  and (iv) if the
assignee  selected by the Company is not an existing Lender,  such assignee
or the Company shall have paid the processing and  recordation fee required
under  Section  9.07(a)  for such  assignment;  provided  further  that the
Company  shall  have no right to  replace  more than  three  Lenders in any
calendar year pursuant to this Section  2.05(b);  and provided further that
the assigning  Lender's  rights under Sections 2.10, 2.13 and 9.04, and its
obligations under Section 8.05, shall survive such assignment as to matters
occurring prior to the date of assignment.

          (c) Non-Ratable Reduction.  (i) The Company shall have the right,
at any time other  than  during  any  Rating  Condition,  upon at least ten
Business Days' notice to a Lender (with a copy to the Agent),  to terminate
in whole such Lender's Commitment  (determined without giving effect to any
Competitive Bid Reduction).  Such termination shall be effective,  (i) with
respect to such Lender's unused  Commitment,  on the date set forth in such
notice,  provided,  however,  that such date shall be no  earlier  than ten
Business  Days after  receipt of such notice and (ii) with  respect to each
Advance  outstanding  to such  Lender,  on the last day of the then current
Interest Period relating to such Advance;  provided further,  however, that
such  termination  shall not be effective,  if, after giving effect to such
termination,  the Company  would,  under this Section  2.05(c),  reduce the
Lenders'  Commitments  in any  calendar  year by an amount in excess of the
Commitments of any three Lenders or  $420,000,000,  whichever is greater on
the date of such termination.  Notwithstanding  the preceding proviso,  the
Company may  terminate in whole the  Commitment of any Lender in accordance
with the terms and conditions set forth in Section 2.05(b) or 2.16(b). Upon
termination  of a Lender's  Commitment  under  this  Section  2.05(c),  the
Company will pay or cause to be paid all principal of, and interest accrued
to the date of such payment on,  Advances  owing to such Lender and pay any
facility  fees or  other  fees  payable  to  such  Lender  pursuant  to the
provisions  of Section 2.04,  and all other amounts  payable to such Lender
hereunder  (including,  but not  limited to, any  increased  costs or other
amounts  owing under Section 2.10 and any  indemnification  for Taxes under
Section  2.13);  and upon such  payments,  the  obligations  of such Lender
hereunder  shall,  by the provisions  hereof,  be released and  discharged;
provided,  however, that such Lender's rights under Sections 2.10, 2.13 and
9.04, and its obligations under Section 8.05 shall survive such release and
discharge as to matters  occurring prior to such date. The aggregate amount
of the  Commitments  of the Lenders once  reduced  pursuant to this Section
2.05(c) may not be reinstated.

          (ii) For purposes of this Section  2.05(c) only, the term "Rating
Condition" shall mean a period  commencing with notice (a "Rating Condition
Notice") by the Agent to the Company and the Lenders to the effect that the
Agent has been  informed  that the rating of the senior  public Debt of the
Company  is  unsatisfactory  under  the  standard  set  forth  in the  next
sentence,  and  ending  with  notice  by the Agent to the  Company  and the
Lenders to the effect that such condition no longer exists. The Agent shall
give a Rating  Condition  Notice  promptly upon receipt from the Company or
any Lender of notice stating,  in effect,  that both of S&P and Moody's (or
any  successor  by  merger  or  consolidation  to the  business  of  either
thereof),  respectively,  then rate the senior  public  Debt of the Company
lower than BBB- and Baa3.  The  Company  agrees to give notice to the Agent
forthwith  upon any change in a rating by either such  organization  of the
senior public Debt of the Company;  the Agent shall have no duty whatsoever
to verify the accuracy of any such notice from the Company or any Lender or
to monitor  independently  the  ratings of the  senior  public  Debt of the
Company  and no Lender  shall  have any duty to give any such  notice.  The
Agent  shall  give  notice  to  the  Lenders  and  the  Company  as to  the
termination of a Rating Condition promptly upon receiving a notice from the
Company to the Agent (which notice the Agent shall  promptly  notify to the
Lenders)  stating that the rating of the senior  public Debt of the Company
does not meet the standard set forth in the second  sentence of this clause
(ii), and requesting  that the Agent notify the Lenders of the  termination
of the Rating  Condition.  The Rating  Condition  shall  terminate upon the
giving of such notice by the Agent.

          (d)  Termination  by a  Lender.  In the  event  that a Change  of
Control  occurs,  each  Lender  may, by notice to the Company and the Agent
given not  later  than 50  calendar  days  after  such  Change of  Control,
terminate its Commitment, which Commitment shall be terminated effective as
of the later of (i) the date that is 60 calendar  days after such Change of
Control or (ii) the end of the Interest Period for any Advance  outstanding
at the time of such Change of Control or for any Advance  made  pursuant to
the next sentence of this Section 2.05(d).  Upon the occurrence of a Change
of Control,  each Borrower's right to make a Borrowing under this Agreement
shall be suspended  for a period of 60 calendar  days,  except for Advances
having an interest period ending not later than 90 calendar days after such
Change of Control. A notice of termination pursuant to this Section 2.05(d)
shall not have the effect of accelerating  any outstanding  Advance of such
Lender and the Notes of such Lender.

          (e) Mandatory Termination. The Commitments shall be terminated in
full on the effective date of the  $7,000,000,000  364-day revolving credit
facility  pursuant to a credit  agreement  among the  Company,  the lenders
party thereto and Citibank,  as agent for such  lenders,  in  substantially
similar form to this Agreement.

          SECTION  2.06.  Repayment  of  Advances.   (a)  Revolving  Credit
Advances.  Each  Borrower  shall subject to the next  succeeding  sentence,
repay to the Administrative  Agent, for the ratable account of the Lenders,
on the  Termination  Date the aggregate  principal  amount of all Revolving
Credit  Advances made to it outstanding on such date. The Company may, upon
not  less  than 15  days'  notice  to the  Agent,  elect  (the  "Term  Loan
Election") to convert on the Termination  Date all of the Revolving  Credit
Advances  outstanding on the Termination Date in effect at such time into a
term loan which the Borrower  that  requested  each such  Revolving  Credit
Advance  shall repay in full ratably to the Lenders on the  Maturity  Date;
provided  that the Term Loan Election may not be exercised if a Default has
occurred and is  continuing on the date of notice of the Term Loan Election
or on the date on which  the Term  Loan  Election  is to be  effected.  All
Revolving Credit Advances converted to a term loan pursuant to this Section
2.06(a) shall continue to constitute  Revolving Credit Advances except that
the  Borrowers  may not reborrow  pursuant to Section 2.01 after all or any
portion of such  Revolving  Credit  Advances have been prepaid  pursuant to
Section 2.10.

          (b)  Competitive  Bid Advances.  Each Borrower shall repay to the
Administrative  Agent,  for the  account  of each  Lender  that  has made a
Competitive Bid Advance, the aggregate outstanding principal amount of each
Competitive  Bid Advance made to such  Borrower and owing to such Lender on
the earlier of (i) the  maturity  date  therefor,  specified in the related
Notice  of  Competitive  Bid  Borrowing   delivered   pursuant  to  Section
2.03(a)(i) and (ii) the Termination Date.

          SECTION  2.07.   Interest  on  Revolving  Credit  Advances.   (a)
Scheduled  Interest.  Each  Borrower  shall  pay  interest  on  the  unpaid
principal amount of each Revolving Credit Advance owing by such Borrower to
each  Lender  from the date of such  Revolving  Credit  Advance  until such
principal amount shall be paid in full, at the following rates per annum:

          (i) Base Rate  Advances.  During such  periods as such  Revolving
     Credit  Advance is a Base Rate Advance,  a rate per annum equal at all
     times to the sum of (x) the Base Rate in effect from time to time plus
     (y) the  Applicable  Utilization  Fee in  effect  from  time to  time,
     payable  in arrears  quarterly  on the last day of each  March,  June,
     September  and December  during such periods and on the date such Base
     Rate Advance shall be paid in full.

          (ii)  Eurocurrency  Rate  Advances.  During such  periods as such
     Revolving  Credit Advance is a Eurocurrency  Rate Advance,  a rate per
     annum  equal  at all  times  during  each  Interest  Period  for  such
     Revolving Credit Advance to the sum of (x) the  Eurocurrency  Rate for
     such Interest  Period for such  Revolving  Credit Advance plus (y) the
     Applicable  Margin in effect from time to time plus (z) the Applicable
     Utilization Fee in effect from time to time, payable in arrears on the
     last day of such Interest  Period and, if such  Interest  Period has a
     duration of more than three  months,  on each day that  occurs  during
     such  Interest  Period  every three  months from the first day of such
     Interest Period and on the date such  Eurocurrency  Rate Advance shall
     be Converted or paid in full.

          (b)  Default  Interest.   Upon  the  occurrence  and  during  the
continuance  of an Event of Default  under Section  6.01(a),  each Borrower
shall pay  interest on (i) the unpaid  principal  amount of each  Revolving
Credit Advance owing by such Borrower to each Lender, payable in arrears on
the dates  referred  to in clause  (a)(i) or (a)(ii)  above,  at a rate per
annum equal at all times to 1% per annum above the rate per annum  required
to be paid on such Revolving  Credit  Advance  pursuant to clause (a)(i) or
(a)(ii) above and (ii) to the fullest  extent  permitted by law, the amount
of any  interest,  fee or other amount  payable  hereunder by such Borrower
that is not paid when due,  from the date  such  amount  shall be due until
such  amount  shall be paid in full,  payable  in  arrears on the date such
amount  shall be paid in full and on demand,  at a rate per annum  equal at
all times to 1% per annum  above the rate per annum  required to be paid on
such Revolving Credit Advance pursuant to clause (a)(i) or (a)(ii) above.

          SECTION 2.08.  Interest Rate  Determination.  (a) Each  Reference
Bank agrees to furnish to the Agent timely  information  for the purpose of
determining  each  Eurocurrency  Rate and each LIBO Rate if the  applicable
Telerate Page is  unavailable.  If any one or more of the  Reference  Banks
shall not furnish such timely  information  to the Agent for the purpose of
determining any such interest rate, the Agent shall determine such interest
rate  on the  basis  of  timely  information  furnished  by  the  remaining
Reference  Banks. The Agent shall give prompt notice to the Company and the
Lenders  of the  applicable  interest  rate  determined  by the  Agent  for
purposes of Section  2.07(a)(i) or (ii), and the rate, if any, furnished by
each Reference Bank for the purpose of determining  the interest rate under
Section 2.07(a)(ii).

          (b) If,  with  respect to any  Eurocurrency  Rate  Advances,  the
Majority  Lenders  notify  the  Agent  that (i) they are  unable  to obtain
matching  deposits  in the London  interbank  market at or about 11:00 A.M.
(London  time) on the second  Business Day before the making of a Borrowing
in sufficient amounts to fund their respective Revolving Credit Advances as
part of such Borrowing  during its Interest Period or (ii) the Eurocurrency
Rate for any Interest Period for such Advances will not adequately  reflect
the cost to such Majority Lenders of making,  funding or maintaining  their
respective  Eurocurrency Rate Advances for such Interest Period,  the Agent
shall forthwith so notify each Borrower and the Lenders,  whereupon (A) the
Borrower  will,  on the  last  day of the  then  existing  Interest  Period
therefor,  (1) if  such  Eurocurrency  Rate  Advances  are  denominated  in
Dollars,  either (x) prepay such Advances or (y) Convert such Advances into
Base  Rate  Advances  and  (2)  if  such  Eurocurrency  Rate  Advances  are
denominated in any Major  Currency,  either (x) prepay such Advances or (y)
redenominate such Advances into an Equivalent amount of Dollars and Convert
such  Advances  into  Base Rate  Advances,  and (B) the  obligation  of the
Lenders to make  Eurocurrency  Rate  Advances in the same  currency as such
Eurocurrency  Rate Advances shall be suspended until the Agent shall notify
each  Borrower  and  the  Lenders  that  the  circumstances   causing  such
suspension no longer exist.

          (c) If any Borrower,  in requesting a Revolving  Credit Borrowing
comprised of Eurocurrency Rate Advances,  shall fail to select the duration
of the Interest  Period for such  Eurocurrency  Rate Advances in accordance
with the  provisions  contained in the  definition of "Interest  Period" in
Section  1.01,  the Agent will  forthwith  so notify the  Borrower  and the
Lenders  and such  Advances  will (to the  extent  such  Eurocurrency  Rate
Advances remain outstanding on such day) automatically,  on the last day of
the then existing  Interest Period therefor,  (i) if such Eurocurrency Rate
Advances are  denominated  in Dollars,  Convert into Base Rate Advances and
(ii) if such  Eurocurrency  Rate  Advances  are  denominated  in any  Major
Currency,  be  redenominated  into an  Equivalent  amount of Dollars and be
Converted into Base Rate Advances.

          (d) Upon the occurrence  and during the  continuance of any Event
of Default under Section 6.01(a),  (i) each  Eurocurrency Rate Advance will
(to the extent such Eurocurrency  Rate Advance remains  outstanding on such
day)  automatically,  on the last day of the then existing  Interest Period
therefor,  (A) if such Eurocurrency Rate Advance is denominated in Dollars,
be  Converted  into a Base Rate Advance and (B) if such  Eurocurrency  Rate
Advance is  denominated in any Major  Currency,  be  redenominated  into an
Equivalent  amount of Dollars and  Converted  into a Base Rate  Advance and
(ii) the obligation of the Lenders to make Eurocurrency Rate Advances shall
be suspended.

          (e) If the applicable Telerate Page is unavailable and fewer than
two Reference Banks furnish timely information to the Agent for determining
the Eurocurrency  Rate or LIBO Rate for any  Eurocurrency  Rate Advances or
LIBO Rate Advances, as the case may be,

          (i) the Agent shall  forthwith  notify the relevant  Borrower and
     the  Lenders  that the  interest  rate cannot be  determined  for such
     Eurocurrency Rate Advances or LIBO Rate Advances, as the case may be,

          (ii)  with  respect  to  Eurocurrency  Rate  Advances,  each such
     Advance will (to the extent such  Eurocurrency  Rate  Advance  remains
     outstanding  on such day)  automatically,  on the last day of the then
     existing  Interest  Period  therefor,  (A) if such  Eurocurrency  Rate
     Advance is  denominated  in  Dollars,  be  prepaid  by the  applicable
     Borrower or be  automatically  Converted  into a Base Rate Advance and
     (B) if such  Eurocurrency  Rate  Advance is  denominated  in any Major
     Currency,  be prepaid by the applicable  Borrower or be  automatically
     redenominated  into an Equivalent amount of Dollars and Converted into
     a Base Rate Advance (or if such  Advance is then a Base Rate  Advance,
     will continue as a Base Rate Advance), and

          (iii) the  obligation  of the Lenders to make  Eurocurrency  Rate
     Advances  or LIBO Rate  Advances  shall be  suspended  until the Agent
     shall  notify the  Borrowers  and the Lenders  that the  circumstances
     causing such suspension no longer exist.

          SECTION  2.09.  Prepayments  of Revolving  Credit  Advances.  (a)
Optional  Prepayments.  Each Borrower may, upon notice to the Agent stating
the proposed date and aggregate  principal amount of the prepayment,  given
not later than 11:00 A.M.  (New York City time) on the second  Business Day
prior to the date of such proposed prepayment,  in the case of Eurocurrency
Rate  Advances,  and not later than 11:00 A.M.  (New York City time) on the
day of such proposed prepayment, in the case of Base Rate Advances, and, if
such notice is given, such Borrower shall, prepay the outstanding principal
amount  of the  Revolving  Credit  Advances  comprising  part  of the  same
Revolving  Credit  Borrowing  in whole or  ratably in part,  together  with
accrued  interest to the date of such  prepayment on the  principal  amount
prepaid; provided, however, that (x) each partial prepayment shall be in an
aggregate  principal  amount not less than  $10,000,000  or the  Equivalent
thereof in a Major Currency (determined on the date notice of prepayment is
given) or an integral multiple of $1,000,000 or the Equivalent thereof in a
Major  Currency  (determined  on the date notice of prepayment is given) in
excess  thereof  and  (y)  in  the  event  of  any  such  prepayment  of  a
Eurocurrency Rate Advance other than on the last day of the Interest Period
therefor,  such  Borrower  shall be obligated  to reimburse  the Lenders in
respect thereof pursuant to Section 9.04(c). Each notice of prepayment by a
Designated  Subsidiary shall be given to the  Administrative  Agent through
the Company.

          (b) Mandatory  Prepayments.  (i) If, on any date,  the sum of (A)
the aggregate principal amount of all Advances  denominated in Dollars then
outstanding  plus (B) the  Equivalent in Dollars  (determined  on the third
Business Day prior to such date) of the aggregate  principal  amount of all
Advances denominated in Foreign Currencies then outstanding exceeds 103% of
the aggregate Commitments of the Lenders on such date, the Company and each
other  Borrower,  if any, shall  thereupon  promptly prepay the outstanding
principal  amount of any  Advances  owing by such  Borrower in an aggregate
amount sufficient to reduce such sum to an amount not to exceed 100% of the
aggregate  Commitments  of the  Lenders  on such  date,  together  with any
interest  accrued to the date of such  prepayment on the principal  amounts
prepaid and, in the case of any prepayment of a Eurocurrency  Rate Advance,
a LIBO Rate  Advance or a Local Rate  Advance on a date other than the last
day of an Interest Period or at its maturity,  any additional amounts which
such  Borrower  shall be  obligated  to reimburse to the Lenders in respect
thereof pursuant to Section 9.04(c).  The Agent shall give prompt notice of
any prepayment  required under this Section 2.09(b)(i) to the Borrowers and
the Lenders.

          (ii) If, on any date, the sum of (A) the Equivalent in Dollars of
the  aggregate   principal  amount  of  all   Eurocurrency   Rate  Advances
denominated in Major Currencies then outstanding plus (B) the Equivalent in
Dollars of the aggregate  principal  amount of all Competitive Bid Advances
denominated in Foreign  Currencies then  outstanding,  shall exceed 110% of
$200,000,000,  the  Company  and  each  other  Borrower  shall  prepay  the
outstanding  principal amount of any such Eurocurrency Rate Advances or any
such  LIBO Rate  Advances  owing by such  Borrower,  on the last day of the
Interest  Periods  relating  to  such  Advances,  in  an  aggregate  amount
sufficient  to  reduce  such sum to an amount  not to exceed  $200,000,000,
together  with any interest  accrued to the date of such  prepayment on the
principal  amounts  prepaid.  The Agent  shall  give  prompt  notice of any
prepayment required under this Section 2.09(b)(ii) to the Borrowers and the
Lenders.

          SECTION  2.10.  Increased  Costs.  (a) If,  due to either (i) the
introduction  of or any  change in or in the  interpretation  of any law or
regulation  or (ii) the  compliance  with any guideline or request from any
central bank or other governmental authority including, without limitation,
any agency of the  European  Union or  similar  monetary  or  multinational
authority  (whether  or not  having the force of law),  there  shall be any
increase in the cost to any Lender of  agreeing to make or making,  funding
or maintaining  Eurocurrency Rate Advances or LIBO Rate Advances (excluding
for purposes of this Section 2.10 any such increased  costs  resulting from
(i) Taxes or Other Taxes (as to which  Section 2.13 shall  govern) and (ii)
changes in the basis of  taxation  of overall  net income or overall  gross
income by the United States or by the foreign  jurisdiction  or state under
the laws of which such Lender is  organized or has its  Applicable  Lending
Office or any  political  subdivision  thereof),  then the Borrower of such
Advances  shall from time to time,  upon demand by such Lender (with a copy
of such  demand to the  Agent),  pay to the Agent for the  account  of such
Lender  additional  amounts  sufficient to compensate  such Lender for such
increased  cost. A  certificate  as to the amount of such  increased  cost,
submitted  to  such  Borrower  and  the  Agent  by such  Lender,  shall  be
conclusive and binding for all purposes, absent manifest error.

          (b) If any  Lender  determines  that  compliance  with any law or
regulation  or any  guideline  or request  from any  central  bank or other
governmental  authority  including,  without limitation,  any agency of the
European Union or similar monetary or multinational  authority  (whether or
not having the force of law)  affects or would affect the amount of capital
required  or expected to be  maintained  by such Lender or any  corporation
controlling such Lender and that the amount of such capital is increased by
or based upon the existence of such Lender's  commitment to lend  hereunder
and other  commitments of this type, then, upon demand by such Lender (with
a copy of such demand to the Agent), the Company shall pay to the Agent for
the account of such Lender,  from time to time as specified by such Lender,
additional amounts sufficient to compensate such Lender or such corporation
in the  light  of  such  circumstances,  to the  extent  that  such  Lender
reasonably  determines  such  increase  in capital to be  allocable  to the
existence of such Lender's  commitment to lend hereunder.  A certificate as
to such amounts submitted to the Company and the Agent by such Lender shall
be conclusive and binding for all purposes, absent manifest error.

          (c) Any Lender claiming any additional  amounts payable  pursuant
to this  Section  2.10  shall,  upon the  written  request  of the  Company
delivered  to  such  Lender  and  the  Agent,  assign,  pursuant  to and in
accordance  with the  provisions  of  Section  9.07,  all of its rights and
obligations  under  this  Agreement  and  under  the  Notes to an  Eligible
Assignee selected by the Company;  provided,  however,  that (i) no Default
shall have  occurred and be  continuing  at the time of such request and at
the time of such  assignment;  (ii) the  assignee  shall  have  paid to the
assigning  Lender the  aggregate  principal  amount  of,  and any  interest
accrued and unpaid to the date of such  assignment on, the Note or Notes of
such Lender;  (iii) the Company shall have paid to the assigning Lender any
and all  facility  fees and other fees payable to such Lender and all other
accrued and unpaid amounts owing to such Lender under any provision of this
Agreement  (including,  but not  limited to, any  increased  costs or other
additional  amounts owing under this Section 2.10, and any  indemnification
for Taxes under Section 2.13) as of the effective  date of such  assignment
and (iv) if the assignee selected by the Company is not an existing Lender,
such assignee or the Company shall have paid the processing and recordation
fee required under Section 9.07(a) for such  assignment;  provided  further
that the assigning  Lender's rights under Sections 2.10, 2.13 and 9.04, and
its  obligations  under Section 8.05,  shall survive such  assignment as to
matters occurring prior to the date of assignment.

          SECTION 2.11. Illegality.  Notwithstanding any other provision of
this Agreement,  if any Lender shall notify the Agent that the introduction
of or any change in or in the interpretation of any law or regulation makes
it unlawful,  or any central bank or other  governmental  authority asserts
that it is unlawful,  for any Lender or its Eurocurrency  Lending Office to
perform its  obligations  hereunder to make  Eurocurrency  Rate Advances in
Dollars or any Major  Currency  or LIBO Rate  Advances in Dollars or in any
Foreign  Currency  or to fund or  maintain  Eurocurrency  Rate  Advances in
Dollars or in any Major Currency or LIBO Rate Advances in Dollars or in any
Foreign Currency hereunder, (a) each such Eurocurrency Rate Advance or such
LIBO  Rate  Advance,  as the case may be,  will  automatically,  upon  such
demand,  (i) if such  Eurocurrency  Rate  Advance  or LIBO Rate  Advance is
denominated in Dollars, be Converted into a Base Rate Advance or an Advance
that bears  interest  at the rate set forth in Section  2.07(a)(i),  as the
case may be,  and  (ii) if such  Eurocurrency  Rate  Advance  or LIBO  Rate
Advance is denominated in any Foreign  Currency,  be redenominated  into an
Equivalent  amount of Dollars and Converted  into a Base Rate Advance or an
Advance that bears interest at the rate set forth in Section 2.07(a)(i), as
the  case  may be,  and (b) the  obligation  of the  Lenders  to make  such
Eurocurrency  Rate Advances or such LIBO Rate  Advances  shall be suspended
until  the  Agent  shall  notify  the  Borrower  and the  Lenders  that the
circumstances causing such suspension no longer exist.

          SECTION 2.12. Payments and Computations.  (a) Each Borrower shall
make each  payment  hereunder  and under any Notes,  except with respect to
principal  of,  interest  on,  and  other  amounts  relating  to,  Advances
denominated in a Foreign Currency, not later than 11:00 A.M. (New York City
time) on the day when due in Dollars to the Agent at the applicable Agent's
Account in same day funds.  Each Borrower shall make each payment hereunder
and under any Notes with  respect to principal  of,  interest on, and other
amounts  relating to Advances  denominated in a Foreign  Currency not later
than 12:00 Noon (at the Payment  Office for such  Foreign  Currency) on the
day when due in such  Foreign  Currency  to the  Agent in same day funds by
deposit of such funds to the  applicable  Agent's  Account.  The Agent will
promptly  thereafter  cause to be  distributed  like funds  relating to the
payment of  principal  or  interest or facility  fees  ratably  (other than
amounts payable  pursuant to Section 2.03,  2.05(b),  2.05(c),  2.10, 2.13,
2.16 or  9.04(c))  to the  Lenders  for the  account  of  their  respective
Applicable  Lending Offices,  and like funds relating to the payment of any
other  amount  payable to any Lender to such  Lender for the account of its
Applicable  Lending  Office,  in each case to be applied in accordance with
the terms of this  Agreement.  Upon its  acceptance  of an  Assignment  and
Acceptance  and  recording  of the  information  contained  therein  in the
Register  pursuant to Section  9.07(c),  from and after the effective  date
specified  in such  Assignment  and  Acceptance,  the Agent  shall make all
payments  hereunder and under any Notes in respect of the interest assigned
thereby  to the  Lender  assignee  thereunder,  and  the  parties  to  such
Assignment and Acceptance  shall make all  appropriate  adjustments in such
payments  for  periods  prior  to  such  effective  date  directly  between
themselves.  Upon any  Assuming  Lender  becoming a Lender  hereunder  as a
result  of  the  effectiveness  of an  extension  of the  Termination  Date
pursuant to Section  2.16,  and upon the Agent's  receipt of such  Lender's
Assumption Agreement and recording the information contained therein in the
Register,  from and after the Increase Date or the  Extension  Date, as the
case may be, the Agent  shall  make all  payments  hereunder  and under any
Notes in respect of the interest assumed thereby to the Assuming Lender.

          (b) All  computations  of interest  based on the Base Rate and of
facility  fees  shall be made by the Agent on the basis of a year of 365 or
366 days,  as the case may be, all  computations  of interest  based on the
Eurocurrency  Rate or the Federal  Funds Rate shall be made by the Agent on
the  basis  of a year  of 360  days  and all  computations  in  respect  of
Competitive  Bid Advances shall be made by the Agent or the  Sub-Agent,  as
the case may be, as specified in the applicable  Notice of Competitive  Bid
Borrowing (or, in each case of Advances  denominated in Foreign  Currencies
where market practice differs, in accordance with market practice), in each
case for the actual number of days  (including  the first day but excluding
the last day)  occurring in the period for which such  interest or facility
fees are  payable.  Each  determination  by the Agent of an  interest  rate
hereunder shall be conclusive and binding for all purposes, absent manifest
error.

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

          (d) Unless the Agent shall have received notice from any Borrower
prior to the date on which any payment is due to the Lenders hereunder that
such Borrower will not make such payment in full, the Agent may assume that
such  Borrower  has made such payment in full to the Agent on such date and
the Agent may, in reliance upon such assumption, cause to be distributed to
each  Lender on such due date an amount  equal to the amount  then due such
Lender.  If and to the  extent  such  Borrower  shall not have so made such
payment  in full  to the  Agent,  each  Lender  shall  repay  to the  Agent
forthwith on demand such amount  distributed  to such Lender  together with
interest thereon,  for each day from the date such amount is distributed to
such Lender until the date such Lender repays such amount to the Agent,  at
(i) the Federal Funds Rate in the case of Advances  denominated  in Dollars
or (ii) the cost of funds  incurred  by the Agent in respect of such amount
in the case of Advances denominated in Foreign Currencies.

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

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

          (c) Each Borrower  shall  indemnify each Lender and the Agent for
the full amount of Taxes or Other Taxes (including, without limitation, any
taxes  imposed by any  jurisdiction  on amounts  payable under this Section
2.13)  imposed on or paid by such  Lender or the Agent (as the case may be)
and any liability  (including  penalties,  interest and  expenses)  arising
therefrom or with respect thereto; provided, however, that a Borrower shall
not be  obligated to pay any amounts in respect of  penalties,  interest or
expenses  pursuant to this paragraph that are payable solely as a result of
(i) the  failure  on the part of the  pertinent  Lender or the Agent to pay
over those amounts  received  from the  Borrowers  under this clause (c) or
(ii)  the  gross  negligence  or  willful  misconduct  on the  part  of the
pertinent Lender or the Agent. This indemnification shall be made within 30
days  from the date  such  Lender  or the  Agent (as the case may be) makes
written demand therefor.  Each Lender agrees to provide  reasonably  prompt
notice to the Agent,  the Company and any  Borrower  of any  imposition  of
Taxes or Other Taxes  against  such Lender;  provided  that failure to give
such  notice  shall not  affect  such  Lender's  rights to  indemnification
hereunder.  Each Lender agrees that it will, promptly upon a request by the
Company or a Borrower  having made an  indemnification  payment  hereunder,
furnish to the Company or such Borrower,  as the case may be, such evidence
as is reasonably available to such Lender as to the payment of the relevant
Taxes or Other Taxes, and that it will, if requested by the Company or such
Borrower,  cooperate with the Company or such Borrower, as the case may be,
in its  efforts  to obtain a refund or  similar  relief in  respect of such
payment.

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

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

          (f) For any period  with  respect to which a Lender has failed to
provide  each  Borrower  with the  appropriate  form  described  in Section
2.13(e)  (other  than if such  failure is due to a change in law  occurring
subsequent  to the  date on  which a form  originally  was  required  to be
provided,  or if such  form  otherwise  is not  required  under  the  first
sentence of  subsection  (e) above),  such Lender  shall not be entitled to
indemnification  under Section 2.13(a) or (c) with respect to Taxes imposed
by the United States by reason of such  failure;  provided,  however,  that
should a Lender become subject to Taxes because of its failure to deliver a
form required hereunder, each Borrower shall take such steps as such Lender
shall reasonably request to assist such Lender to recover such Taxes.

          (g) If any Borrower is required to pay any  additional  amount to
any  Lender  or to the  Agent  or on  behalf  of any of them to any  taxing
authority  pursuant  to this  Section  2.13,  such Lender  shall,  upon the
written  request of the  Company  delivered  to such  Lender and the Agent,
assign,  pursuant to and in accordance with the provisions of Section 9.07,
all of its rights and obligations  under this Agreement and under the Notes
to an Eligible Assignee selected by the Company;  provided,  however,  that
(i) no Default  shall have  occurred and be  continuing at the time of such
request and at the time of such  assignment;  (ii) the assignee  shall have
paid to the  assigning  Lender the aggregate  principal  amount of, and any
interest  accrued and unpaid to the date of such assignment on, the Note or
Notes of such Lender;  (iii) the Company  shall have paid to the  assigning
Lender any and all facility  fees and other fees payable to such Lender and
all  other  accrued  and  unpaid  amounts  owing to such  Lender  under any
provision of this Agreement  (including,  but not limited to, any increased
costs or  other  additional  amounts  owing  under  Section  2.10,  and any
indemnification for Taxes under this Section 2.13) as of the effective date
of such assignment; and (iv) if the assignee selected by the Company is not
an  existing  Lender,  such  assignee  or the  Company  shall have paid the
processing  and  recordation  fee required  under Section  9.07(a) for such
assignment;  provided  further  that the  assigning  Lender's  rights under
Sections 2.10, 2.13 and 9.04, and its obligations under Section 8.05, shall
survive  such  assignment  as to  matters  occurring  prior  to the date of
assignment.

          SECTION  2.14.  Sharing of  Payments,  Etc.  If any Lender  shall
obtain any payment (whether voluntary, involuntary, through the exercise of
any right of setoff,  or  otherwise)  on account  of the  Revolving  Credit
Advances  owing to it  (other  than  pursuant  to  Section  2.03,  2.05(b),
2.05(c),  2.10,  2.13,  2.16 or 9.04(c)) in excess of its ratable  share of
payments on account of the Revolving  Credit  Advances  obtained by all the
Lenders,  such Lender shall forthwith  purchase from the other Lenders such
participations  in the Revolving  Credit Advances owing to them as shall be
necessary  to cause  such  purchasing  Lender to share the  excess  payment
ratably with each of them; provided, however, that if all or any portion of
such excess payment is thereafter  recovered from such  purchasing  Lender,
such  purchase  from each Lender shall be  rescinded  and such Lender shall
repay to the  purchasing  Lender the  purchase  price to the extent of such
recovery  together  with an amount  equal to such  Lender's  ratable  share
(according to the  proportion  of (i) the amount of such 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.  Each  Borrower  agrees that any
Lender so purchasing a  participation  from another Lender pursuant to this
Section 2.14 may, to the fullest extent permitted by law,  exercise all its
rights of  payment  (including  the right of setoff)  with  respect to such
participation  as fully as if such Lender were the direct  creditor of such
Borrower in the amount of such participation.

          SECTION 2.15. Use of Proceeds. The proceeds of the Advances shall
be available  (and each  Borrower  agrees that it shall use such  proceeds)
solely to finance,  or to backstop  commercial  paper issued in  connection
with, the acquisition of AMP Inc. and for other general corporate  purposes
of such  Borrower  and its  Subsidiaries,  including,  without  limitation,
backstop of commercial paper.

          SECTION 2.16. Extension of Termination Date. (a) At least 45 (but
no earlier than 60) days prior to each anniversary date hereof and provided
all  representations  and  warranties  are true and correct in all material
respects  and no Event of  Default  has  occurred  and is  continuing,  the
Company may, at its option,  by written  notice to the Agent,  request that
the Lenders  extend for an additional  364 days from the  Termination  Date
then in effect; provided, however, that the Company shall not have made the
Term Loan Election for Advances  outstanding on such Termination Date prior
to such time.  Each Lender,  in its sole  discretion,  shall consent or not
consent to such  extension  and shall  notify  the Agent of its  consent or
nonconsent  to such  extension  within 20  Business  Days of notice of such
request from the Agent. If all of the Lenders consent in writing,  the then
applicable  Termination  Date shall,  effective as at such anniversary date
(the  "Extension  Date"),  be  extended  for a period of 364 days from such
Extension Date.

          (b) If not all of the Lenders consent, pursuant to subsection (a)
of this  Section  2.16,  to an extension  of the  Termination  Date then in
effect  (the  Lenders  so  consenting  in  writing  being  the  "Consenting
Lenders",  and  any  Lender  not  so  consenting  being  a  "Non-Consenting
Lender"), the Company may:

          (i) arrange for one or more Consenting  Lenders or other Eligible
     Assignees as Assuming  Lenders to assume,  effective on the  Extension
     Date,  any   Non-Consenting   Lender's   Commitment  and  all  of  the
     obligations  of such Lender under this Agreement  thereafter  arising,
     and effective on such Extension Date,  each such Consenting  Lender or
     such  Assuming  Lender  will be  substituted  for such  Non-Consenting
     Lender under this Agreement; provided, however, that the amount of the
     Commitment  of  any  such   Assuming   Lender  as  a  result  of  such
     substitution  shall  in no event be less  than  $10,000,000;  provided
     further that (i) any such  Consenting  Lender or Assuming Lender shall
     have paid to such Non-Consenting Lender the aggregate principal amount
     of, and any interest  accrued and unpaid to the date of the assignment
     on, the Advances of such Non-Consenting Lender; (ii) the Company shall
     have paid to such Non-Consenting  Lender any and all facility fees and
     other fees payable to such Non-Consenting Lender and all other accrued
     and  unpaid  amounts  owing to such  Non-Consenting  Lender  under any
     provision  of this  Agreement  (including,  but not  limited  to,  any
     increased costs or other additional  amounts owing under Section 2.10,
     and any  indemnification  for Taxes under this Section 2.13) as of the
     effective date of such assignment;  and (iii) with respect to any such
     Assuming  Lender,  such Assuming Lender or the Company shall have paid
     the applicable  processing and  recordation fee required under Section
     9.07(a) for such assignment; provided further that such Non-Consenting
     Lender's   rights  under  Sections  2.10,   2.13  and  9.04,  and  its
     obligations  under Section 8.05, shall survive such substitution as to
     matters occurring prior to the date of substitution;  provided further
     that,  on or prior to the tenth day prior to the Extension  Date,  (x)
     any such Assuming  Lender shall have  delivered to the Company and the
     Agent an Assumption  Agreement in substantially  the form of Exhibit D
     hereto,  duly executed by such Assuming  Lender,  such  Non-Consenting
     Lender  and the  Company,  (y) any such  Consenting  Bank  shall  have
     delivered  confirmation in writing satisfactory to the Agent as to its
     increased Commitment and (z) each Non-Consenting Lender being replaced
     pursuant  to this  clause  (i) shall have  delivered  to the Agent any
     Revolving Credit Note or Notes held by such Non-Consenting Lender; and
     provided  further  that,  if requested by any  Assuming  Lender,  each
     Borrower, at its own expense, shall have executed and delivered to the
     Agent no later than 10:00 A.M.  (New York City time) on the  Extension
     Date,  Revolving  Credit  Notes  payable  to the  order  of each  such
     Assuming  Lender,   if  any,  dated  as  of  the  Extension  Date  and
     substantially in the form of Exhibit A-1 hereto; or

          (ii)  subject  to the  giving of  notice  to such  Non-Consenting
     Lender at least four days prior to the Extension  Date, pay, prepay or
     cause to be prepaid,  on and effective as of the Extension  Date,  all
     principal  of, and  interest  accrued to the date of such  payment on,
     Advances and all other  amounts  owing to such  Non-Consenting  Lender
     hereunder (including, but not limited to, any increased costs or other
     additional  amounts owing under  Section 2.10 and any  indemnification
     for  Taxes   under   Section   2.13)  and   terminate   in  whole  any
     Non-Consenting Lender's Commitment,  notwithstanding the provisions of
     Section 2.05; and, upon such payment or prepayment, the obligations of
     such Non-Consenting  Lender hereunder shall, by the provisions hereof,
     be   released   and   discharged;   provided,   however,   that   such
     Non-Consenting Lender's rights under Sections 2.10, 2.13 and 9.04, and
     its  obligations  under  Section  8.05 shall  survive such release and
     discharge as to matters occurring prior to the Extension Date.

          (c) In the  event  that,  on or  prior  to  the  then  applicable
Extension  Date, all  Non-Consenting  Lenders shall have been superseded by
Consenting  Lenders or Assuming Lenders or shall have had their Commitments
terminated  pursuant to subsection (b)(i) or (b)(ii) above, the Termination
Date then in effect shall be extended for the additional one-year period as
described in subsection (a) above, each Non-Consenting Lender shall have no
further  Commitment  hereunder,  and each Assuming  Lender,  if any,  shall
thereafter be  substituted as a party to this Agreement and be a Lender for
the purposes of this Agreement,  without any further  acknowledgment  by or
the consent of the Lenders.  The Agent shall thereupon promptly deliver the
new Revolving Credit Notes to the respective  Assuming  Lenders  requesting
such Notes and record in the Register the relevant information with respect
to each Consenting Lender and each such Assuming Lender.

          (d) In the event that (x) as to a Non-Consenting  Lender, neither
procedure contemplated by subsection (b)(i) or (b)(ii) above is implemented
in a timely basis or (y) the Company shall,  by written notice to the Agent
at least four days prior to the  Extension  Date,  withdraw its request for
the extension of the Termination  Date then in effect,  such request by the
Company  shall be deemed not to have been  made,  all  actions  theretofore
taken under subsection  (b)(i) or (b)(ii) above shall be deemed to be of no
effect, the Agent shall return any Revolving Credit Notes received from any
Non-Consenting  Lender to such Non-Consenting Lender and all the rights and
obligations  of the parties  shall  continue as if no such request had been
made.

          SECTION 2.17. Evidence of Debt. (a) Each Lender shall maintain in
accordance  with its usual  practice an account or accounts  evidencing the
indebtedness of each Borrower to such Lender  resulting from each Revolving
Credit  Advance  owing to such  Lender  from  time to time,  including  the
amounts of principal and interest payable and paid to such Lender from time
to time hereunder in respect of Revolving  Credit  Advances.  Each Borrower
agrees  that upon  request of any Lender to such  Borrower  (with a copy of
such notice to the Agent) that such Lender receive a Revolving  Credit Note
to evidence (whether for purposes of pledge,  enforcement or otherwise) the
Revolving  Credit  Advances  owing to, or to be made by, such Lender,  such
Borrower  shall  promptly  execute  and  deliver to such Lender a Revolving
Credit Note payable to the order of such Lender in a principal amount up to
the Commitment of such Lender.

          (b) The  Register  maintained  by the Agent  pursuant  to Section
9.07(d) shall include a control account,  and a subsidiary account for each
Lender,  in which accounts (taken  together) shall be recorded (i) the date
and  amount  of  each  Borrowing  made  hereunder,  the  Type  of  Advances
comprising  such  Borrowing  and,  if  appropriate,   the  Interest  Period
applicable  thereto,  (ii) the terms of each Assumption  Agreement and each
Assignment and Acceptance delivered to and accepted by it, (iii) the amount
of any  principal  or interest due and payable or to become due and payable
from each Borrower to each Lender  hereunder and (iv) the amount of any sum
received by the Agent from each Borrower  hereunder and each Lender's share
thereof.

          (c)  Entries  made in good  faith by the  Agent  in the  Register
pursuant  to  subsection  (b) above,  and by each  Lender in its account or
accounts pursuant to subsection (a) above, shall be prima facie evidence of
the amount of  principal  and interest due and payable or to become due and
payable from the  Borrowers  to, in the case of the  Register,  each Lender
and,  in the case of such  account or  accounts,  such  Lender,  under this
Agreement,  absent manifest error;  provided,  however, that the failure of
the Agent or such Lender to make an entry,  or any finding that an entry is
incorrect,  in the Register or such account or accounts  shall not limit or
otherwise affect the obligations of any Borrower under this Agreement.

                                ARTICLE III

                  CONDITIONS TO EFFECTIVENESS AND LENDING

          SECTION 3.01.  Conditions  Precedent to Effectiveness of Sections
2.01  and  2.03.  Sections  2.01 and 2.03 of this  Agreement  shall  become
effective on and as of the first date (the  "Effective  Date") on which the
following conditions precedent have been satisfied:

          (a) There shall have  occurred no Material  Adverse  Change since
     December 31, 1997.

          (b) There shall exist no action, suit, investigation,  litigation
     or proceeding affecting the Company or any of its Subsidiaries pending
     or to the  knowledge  of the  Company  Threatened  before  any  court,
     governmental  agency or arbitrator  that (i) is  reasonably  likely to
     have a Material  Adverse Effect,  other than the matters  described on
     Schedule 3.01(b) hereto (the "Disclosed  Litigation") or (ii) purports
     to affect the legality,  validity or  enforceability of this Agreement
     or any Note of the  Company or the  consummation  of the  transactions
     contemplated  hereby,  and there shall have been no adverse  change in
     the  status,  or  financial  effect  on  the  Company  or  any  of its
     Subsidiaries,  of the  Disclosed  Litigation  from that  described  on
     Schedule 3.01(b) hereto.

          (c) The Company  shall have paid all accrued fees and expenses of
     the Agent and the Lenders in respect of this Agreement.

          (d) On the Effective Date, the following statements shall be true
     and the Agent  shall  have  received  a  certificate  signed by a duly
     authorized  officer of the Company,  dated the Effective Date, stating
     that:

                    (i) The  representations  and  warranties  contained in
          Section 4.01 are correct on and as of the Effective Date, and

                    (ii) No  event  has  occurred  and is  continuing  that
          constitutes a Default.

          (e) The Agent shall have received on or before the Effective Date
     the following, each dated such day, in form and substance satisfactory
     to the Agent:

                    (i) The  Revolving  Credit  Notes of the Company to the
          order  of the  Lenders  to the  extent  requested  by any  Lender
          pursuant to Section 2.17.

                    (ii) Certified  copies of the  resolutions of the Board
          of  Directors of the Company  approving  this  Agreement  and the
          Notes  of the  Company,  and of all  documents  evidencing  other
          necessary  corporate action and governmental  approvals,  if any,
          with respect to this Agreement and such Notes.

                    (iii) A  certificate  of the  Secretary or an Assistant
          Secretary of the Company certifying the names and true signatures
          of the officers of the Company  authorized to sign this Agreement
          and the  Notes  of the  Company  and the  other  documents  to be
          delivered hereunder.

                    (iv)   Authenticated   copies  of  the  Certificate  of
          Incorporation and By-Laws of the Company.

                    (v) A  favorable  opinion of J.  Edward  Smith,  Senior
          Counsel of the  Company,  substantially  in the form of Exhibit G
          hereto and as to such other  matters  as any Lender  through  the
          Agent may reasonably request.

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

                    (vii) Such other  approvals,  opinions or  documents as
          any Lender, through the Agent, may reasonably request.

          SECTION 3.02.  Initial Loan to Each  Designated  Subsidiary.  The
obligation  of each  Lender to make an initial  Advance to each  Designated
Subsidiary  following any  designation of such  Designated  Subsidiary as a
Borrower  hereunder  pursuant  to Section  9.08 is  subject to the  Agent's
receipt  on or  before  the  date of such  Initial  Advance  of each of the
following,  in form and substance  satisfactory to the Agent and dated such
date, and (except for the Revolving Credit Notes) in sufficient  copies for
each Lender:

          (a) The  Revolving  Credit Notes of such Borrower to the order of
     the Lenders to the extent  requested by any Lender pursuant to Section
     2.17.

          (b) Certified copies of the resolutions of the Board of Directors
     of such Borrower (with a certified English translation if the original
     thereof is not in English)  approving  this Agreement and the Notes of
     such  Borrower,  and  of  all  documents  evidencing  other  necessary
     corporate action and governmental  approvals,  if any, with respect to
     this Agreement and such Notes.

          (c) A certificate  of the Secretary or an Assistant  Secretary of
     such Borrower certifying the names and true signatures of the officers
     of such Borrower  authorized  to sign this  Agreement and the Notes of
     such Borrower and the other documents to be delivered hereunder.

          (d) A  certificate  signed by a duly  authorized  officer  of the
     Company, dated as of the date of such Initial Advance, certifying that
     such  Borrower  shall have obtained all  governmental  and third party
     authorizations,   consents,   approvals  (including  exchange  control
     approvals) and licenses required under applicable laws and regulations
     necessary for such Borrower to execute and deliver this  Agreement and
     the Notes and to perform its obligations thereunder.

          (e)  The  Designation  Letter  of  such  Designated   Subsidiary,
     substantially in the form of Exhibit E hereto.

          (f) Evidence of the Process Agent's acceptance of its appointment
     pursuant   to  Section   9.13(a)  as  the  agent  of  such   Borrower,
     substantially in the form of Exhibit F hereto.

          (g) A favorable opinion of counsel to such Designated Subsidiary,
     dated the date of such Initial  Advance,  substantially in the form of
     Exhibit H hereto.

          (h) Such other  approvals,  opinions or  documents as any Lender,
     through the Agent, may reasonably request.

          SECTION  3.03.  Conditions  Precedent  to Each  Revolving  Credit
Borrowing. The obligation of each Lender to make a Revolving Credit Advance
on the occasion of each Revolving  Credit Borrowing shall be subject to the
conditions precedent that the Effective Date shall have occurred and on the
date of such Revolving Credit Borrowing (a) the following  statements shall
be true  (and  each of the  giving of the  applicable  Notice of  Revolving
Credit  Borrowing  and  the  acceptance  by the  Borrower  requesting  such
Revolving  Credit  Borrowing  of the  proceeds  of  such  Revolving  Credit
Borrowing shall constitute a  representation  and warranty by such Borrower
that on the date of such Borrowing such statements are true):

          (i) the  representations  and warranties of the Company contained
     in Section  4.01  (except  the  representations  set forth in the last
     sentence of subsection (e) thereof and in subsections (f), (h)-(l) and
     (n)  thereof)  are  correct  on and as of the  date of such  Revolving
     Credit  Borrowing,  before and after giving  effect to such  Revolving
     Credit Borrowing and to the application of the proceeds therefrom,  as
     though  made  on  and as of  such  date,  and  additionally,  if  such
     Revolving  Credit  Borrowing shall have been requested by a Designated
     Subsidiary,  the  representations  and  warranties of such  Designated
     Subsidiary  contained in its Designation  Letter are correct on and as
     of the date of such  Revolving  Credit  Borrowing,  before  and  after
     giving  effect  to  such  Revolving   Credit   Borrowing  and  to  the
     application  of the  proceeds  therefrom,  as though made on and as of
     such date, and

          (ii) no event has  occurred  and is  continuing,  or would result
     from such Revolving  Credit  Borrowing or from the  application of the
     proceeds therefrom, that constitutes a Default;

and (b) the Agent shall have  received  such other  approvals,  opinions or
documents as any Lender through the Agent may reasonably request.

          SECTION  3.04.  Conditions  Precedent  to  Each  Competitive  Bid
Borrowing.  The obligation of each Lender that is to make a Competitive Bid
Advance  on the  occasion  of a  Competitive  Bid  Borrowing  to make  such
Competitive  Bid  Advance  as part of such  Competitive  Bid  Borrowing  is
subject to the conditions  precedent that (i) the Agent shall have received
the written  confirmatory  Notice of Competitive Bid Borrowing with respect
thereto, (ii) on or before the date of such Competitive Bid Borrowing,  but
prior to such  Competitive  Bid Borrowing,  the Agent shall have received a
Competitive Bid Note payable to the order of such Lender and  substantially
in the form of Exhibit  A-2 hereto for each of the one or more  Competitive
Bid  Advances  to be made by such  Lender as part of such  Competitive  Bid
Borrowing,  in a  principal  amount  equal to the  principal  amount of the
Competitive Bid Advance to be evidenced thereby and otherwise on such terms
as were  agreed to for such  Competitive  Bid  Advance in  accordance  with
Section 2.03, and (iii) on the date of such  Competitive  Bid Borrowing the
following  statements  shall  be  true  (and  each  of  the  giving  of the
applicable  Notice of  Competitive  Bid Borrowing and the acceptance by the
Borrower  requesting such Competitive Bid Borrowing of the proceeds of such
Competitive Bid Borrowing shall constitute a representation and warranty by
such  Borrower  that on the date of such  Competitive  Bid  Borrowing  such
statements are true):

          (a) the  representations  and warranties of the Company contained
     in Section  4.01  (except  the  representations  set forth in the last
     sentence of subsection (e) thereof and in subsections (f), (h)-(l) and
     (n) thereof) are correct on and as of the date of such Competitive Bid
     Borrowing,  before and after  giving  effect to such  Competitive  Bid
     Borrowing and to the application of the proceeds therefrom,  as though
     made on and as of such date,  and, if such  Competitive  Bid Borrowing
     shall  have  been   requested   by  a   Designated   Subsidiary,   the
     representations and warranties of such Designated Subsidiary contained
     in its  Designation  Letter are  correct on and as of the date of such
     Competitive  Bid  Borrowing,  before and after  giving  effect to such
     Competitive  Bid  Borrowing  and to the  application  of the  proceeds
     therefrom, as though made on and as of such date,

          (b) no event has occurred and is continuing, or would result from
     such Competitive Bid Borrowing or from the application of the proceeds
     therefrom, that constitutes a Default, and

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

and (iv) the Agent shall have  received such other  approvals,  opinions or
documents as any Lender through the Agent may reasonably request.

          SECTION 3.05.  Determinations Under Section 3.01. For purposes of
determining  compliance with the conditions specified in Section 3.01, each
Lender 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 the Lenders
unless  an  officer  of  the  Agent   responsible   for  the   transactions
contemplated  by this Agreement shall have received notice from such Lender
prior to the date that the Company, by notice to the Lenders, designates as
the proposed Effective Date,  specifying its objection  thereto.  The Agent
shall promptly notify the Lenders of the occurrence of the Effective Date.

                                 ARTICLE IV

                       REPRESENTATIONS AND WARRANTIES

          SECTION 4.01.  Representations and Warranties of the Company. The
Company represents and warrants as follows:

          (a) The Company is a corporation duly organized, validly existing
     and in good standing under the laws of the State of Delaware.

          (b) The  execution,  delivery and  performance  by the Company of
     this Agreement and the Notes of the Company,  and the  consummation of
     the  transactions   contemplated  hereby,  are  within  the  Company's
     corporate powers, have been duly authorized by all necessary corporate
     action, and do not and will not cause or constitute a violation of any
     provision of law or regulation or any provision of the  Certificate of
     Incorporation or By-Laws of the Company or result in the breach of, or
     constitute  a default or require any consent  under,  or result in the
     creation  of  any  lien,   charge  or  encumbrance  upon  any  of  the
     properties,  revenues,  or  assets of the  Company  pursuant  to,  any
     indenture or other  agreement or  instrument to which the Company is a
     party  or by  which  the  Company  or its  property  may be  bound  or
     affected.

          (c) No authorization,  consent,  approval (including any exchange
     control  approval),  license  or other  action by, and no notice to or
     filing   or   registration    with,   any   governmental    authority,
     administrative  agency or regulatory  body or any other third party is
     required  for the  due  execution,  delivery  and  performance  by the
     Company of this Agreement or the Notes of the Company.

          (d) This Agreement has been, and each of the Notes when delivered
     hereunder will have been,  duly executed and delivered by the Company.
     This Agreement is, and each of the Notes of the Company when delivered
     hereunder  will be, the legal,  valid and  binding  obligation  of the
     Company  enforceable  against  the  Company in  accordance  with their
     respective  terms,  except to the extent that such  enforcement may be
     limited by applicable  bankruptcy,  insolvency  and other similar laws
     affecting creditors' rights generally.

          (e)  The  Consolidated  balance  sheet  of the  Company  and  its
     Consolidated  Subsidiaries  as at December 31,  1997,  and the related
     Consolidated  statements  of income and cash flows of the  Company and
     its Consolidated Subsidiaries for the fiscal year then ended (together
     with the notes to the  financial  statements  of the  Company  and its
     Consolidated  Subsidiaries  and the  Consolidated  statements  of cash
     flows of the Company and its Consolidated  Subsidiaries),  accompanied
     by  an  opinion  of  one  or  more  nationally   recognized  firms  of
     independent public accountants,  and the Consolidated balance sheet of
     the Company and its Consolidated Subsidiaries as at June 30, 1998, and
     the related  Consolidated  statements  of income and cash flows of the
     Company  and its  Consolidated  Subsidiaries  for the six months  then
     ended,  duly  certified  by the  principal  financial  officer  of the
     Company,  copies of which  have been  furnished  to each  Lender,  are
     materially complete and correct,  and fairly present,  subject, in the
     case of said balance sheet as at June 30, 1998, and said statements of
     income and cash flows for the six months then ended, to year-end audit
     adjustments,  the Consolidated  financial condition of the Company and
     its  Consolidated  Subsidiaries as at such dates and the  Consolidated
     results  of  the  operations  of  the  Company  and  its  Consolidated
     Subsidiaries  for the periods  ended on such dates,  all in accordance
     with GAAP consistently applied, except as otherwise noted therein; the
     Company and its Consolidated Subsidiaries do not have on such date any
     material  contingent  liabilities,   liabilities  for  taxes,  unusual
     forward or long-term  commitments or unrealized or anticipated  losses
     from any unfavorable  commitments,  except as referred to or reflected
     or provided for in such balance  sheet or the notes thereto as at such
     date.  Since  December  31, 1997,  there has been no Material  Adverse
     Change.  

          (f)  There  is no  action,  suit,  investigation,  litigation  or
     proceeding,  including,  without limitation, any Environmental Action,
     pending or to the  knowledge of the Company  Threatened  affecting the
     Company or any of its  Subsidiaries  before  any  court,  governmental
     agency or arbitrator that (i) is reasonably  likely to have a Material
     Adverse Effect (other than the Disclosed Litigation), or (ii) purports
     to affect the legality,  validity or  enforceability of this Agreement
     or any  Note  or the  consummation  of the  transactions  contemplated
     hereby,  and  there  has been no  adverse  change  in the  status,  or
     financial  effect on the  Company or any of its  Subsidiaries,  of the
     Disclosed Litigation from that described on Schedule 3.01(b) hereto.

          (g) Following  application  of the proceeds of each Advance,  not
     more  than 25  percent  of the  value  of the  assets  (either  of the
     Borrower of such Advance or of such Borrower and its Subsidiaries on a
     Consolidated  basis) subject to the  provisions of Section  5.02(a) or
     subject to any  restriction  contained in any  agreement or instrument
     between such  Borrower  and any Lender or any  Affiliate of any Lender
     relating  to Debt and  within  the scope of  Section  6.01(e)  will be
     margin stock  (within the meaning of  Regulation U issued by the Board
     of Governors of the Federal Reserve System).

          (h) The Company and each  wholly-owned  direct  Subsidiary of the
     Company have, in the aggregate, met their minimum funding requirements
     under ERISA with respect to their Plans in all  material  respects and
     have not incurred any material  liability to the PBGC,  other than for
     the payment of premiums, in connection with such Plans.

          (i) No ERISA  Event has  occurred  or is  reasonably  expected to
     occur  with  respect  to any Plan of the  Company  or any of its ERISA
     Affiliates that has resulted in or is reasonably likely to result in a
     material liability of the Company or any of its ERISA Affiliates.

          (j) The Schedules B (Actuarial  Information) to the [1997] annual
     reports (Form 5500 Series) with respect to each Plan of the Company or
     any of its ERISA Affiliates,  copies of which have been filed with the
     Internal  Revenue  Service  (and which will be  furnished  to any Bank
     through the Administrative Agent upon the request of such Bank through
     the Administrative Agent to the Company), are complete and accurate in
     all material  respects and fairly present in all material respects the
     funding  status of such Plans at such date, and since the date of each
     such Schedule B there has been no material  adverse  change in funding
     status.

          (k)  Neither  the  Company  nor any of its ERISA  Affiliates  has
     incurred or reasonably  expects to incur any  Withdrawal  Liability to
     any  Multiemployer  Plan  in an  annual  amount  exceeding  6% of  Net
     Tangible Assets of the Company and its Consolidated Subsidiaries.

          (l) Neither the Company nor any of its ERISA  Affiliates has been
     notified   by  the   sponsor  of  a   Multiemployer   Plan  that  such
     Multiemployer Plan is in reorganization or has been terminated, within
     the  meaning  of  Title IV of  ERISA.  No such  Multiemployer  Plan is
     reasonably  expected  to be  in  reorganization  or to be  terminated,
     within  the  meaning  of Title IV of  ERISA,  in a  reorganization  or
     termination  which  might  reasonably  be  expected  to  result  in  a
     liability of the Company in an amount in excess of $5,000,000.

          (m) The Company is not, and immediately  after the application by
     the  Company  of the  proceeds  of  each  Loan  will  not  be,  (a) an
     "investment  company" within the meaning of the Investment Company Act
     of 1940, as amended,  or (b) a "holding company" within the meaning of
     the Public Utility Holding Company Act of 1935, as amended.

          (n) To the best of the Company's  knowledge,  the  operations and
     properties of the Company and its Subsidiaries taken as a whole comply
     in all material  respects with all  Environmental  Laws, all necessary
     Environmental  Permits have been applied for or have been obtained and
     are in effect for the operations and properties of the Company and its
     Subsidiaries and the Company and its Subsidiaries are in compliance in
     all material respects with all such Environmental Permits. To the best
     of the  Company's  knowledge  no  circumstances  exist  that  would be
     reasonably likely to form the basis of an Environmental Action against
     the Company or any of its Subsidiaries or any of their properties that
     could have a Material Adverse Effect.

                                 ARTICLE V

                         COVENANTS OF THE BORROWER

          SECTION 5.01. Affirmative Covenants. So long as any Advance shall
remain  unpaid or any  Lender  shall  have any  Commitment  hereunder,  the
Company will:

          (a) Compliance with Laws, Etc. Comply,  and cause each Designated
     Subsidiary to comply with all applicable laws, rules,  regulations and
     orders,  such compliance to include,  without  limitation,  compliance
     with ERISA and Environmental  Laws as provided in Section 5.01(j),  if
     failure to comply with such requirements would have a Material Adverse
     Effect.

          (b)  Payment of Taxes,  Etc.  Pay and  discharge,  and cause each
     Designated Subsidiary to pay and discharge, all taxes, assessments and
     governmental  charges  or levies  imposed  upon it or on its income or
     profits or upon any of its property;  provided,  however, that neither
     the  Company nor any of its  Subsidiaries  shall be required to pay or
     discharge  any such tax,  assessment,  charge  or claim  that is being
     contested  in good  faith  and by proper  proceedings  and as to which
     appropriate reserves are being maintained.

          (c) Maintenance of Insurance. Maintain, and cause each Designated
     Subsidiary  to maintain,  insurance  with  responsible  and  reputable
     insurance  companies or associations in such amounts and covering such
     risks as is usually carried by companies engaged in similar businesses
     and owning  similar  properties in the same general areas in which the
     Company or such Subsidiary operates.

          (d)  Preservation  of  Corporate  Existence,  Etc.  Preserve  and
     maintain,  and  cause  each  Designated  Subsidiary  to  preserve  and
     maintain, its corporate existence and all its material rights (charter
     and statutory) privileges and franchises;  provided, however, that the
     Company and each  Designated  Subsidiary  may  consummate  any merger,
     consolidation or sale of assets permitted under Section 5.02(b).

          (e) Visitation  Rights.  At any reasonable  time and from time to
     time,  permit  the  Agent  or any  of the  Lenders  or any  agents  or
     representatives  thereof,  to examine and make copies of and abstracts
     from the records and books of account of, and visit the properties of,
     the Company and any Designated Subsidiary, and to discuss the affairs,
     finances  and  accounts of the Company and any  Designated  Subsidiary
     with any of their  officers or  directors  and with their  independent
     certified public accountants.

          (f) Keeping of Books. Keep, and cause each Designated  Subsidiary
     to keep, proper books of record and account, in which full and correct
     entries shall be made of all financial transactions and the assets and
     business of the Company and each  Designated  Subsidiary in accordance
     with generally accepted  accounting  principles in effect from time to
     time.

          (g) Maintenance of Properties,  Etc.  Maintain and preserve,  and
     cause each Designated Subsidiary to maintain and preserve,  all of its
     properties  that are used or useful in the conduct of its  business in
     good working order and  condition,  ordinary  wear and tear  excepted;
     provided,  however, that neither the Company nor any of its Designated
     Subsidiaries shall be required to maintain or preserve any property if
     the failure to maintain or  preserve  such  property  shall not have a
     Material Adverse Effect.

          (h) Reporting Requirements. Furnish to the Agent (with a copy for
     each  Lender)  and the Agent  shall  promptly  forward the same to the
     Lenders:

                    (i) as soon as  available  and in any  event  within 60
          days after the end of each of the first  three  quarters  of each
          fiscal year of the Company,  a Consolidated  balance sheet of the
          Company and its  Consolidated  Subsidiaries as of the end of such
          quarter and a Consolidated  statement of income and cash flows of
          the  Company  and its  Consolidated  Subsidiaries  for the period
          commencing at the end of the previous fiscal year and ending with
          the  end  of  such  quarter,   setting  forth  in  each  case  in
          comparative   form   the   corresponding   figures   as  of   the
          corresponding  date  and  for  the  corresponding  period  of the
          preceding fiscal year, all in reasonable  detail and certified by
          the principal  financial officer,  principal  accounting officer,
          the Vice-President and Treasurer or an Assistant Treasurer of the
          Company,  subject,  however,  to year-end  auditing  adjustments,
          which certificate shall include a statement that such officer has
          no knowledge,  except as specifically  stated,  of any condition,
          event or act which constitutes a Default;

                    (ii) as soon as  available  and in any event within 120
          days  after  the  end of  each  fiscal  year  of the  Company,  a
          Consolidated  balance  sheet of the Company and its  Consolidated
          Subsidiaries  as of the end of such  fiscal  year and the related
          Consolidated  statements  of income and cash flows of the Company
          and its  Consolidated  Subsidiaries  for such fiscal year setting
          forth in each case in comparative form the corresponding  figures
          as of the  close of and for the  preceding  fiscal  year,  all in
          reasonable  detail and  accompanied  by an opinion of independent
          public accountants of nationally  recognized standing, as to said
          financial statements and a certificate of the principal financial
          officer,  principal  accounting  officer,  the Vice-President and
          Treasurer or an Assistant  Treasurer of the Company  stating that
          such officer has no knowledge,  except as specifically stated, of
          any condition, event or act which constitutes a Default;

                    (iii)  copies  of the Forms  8-K and 10-K  reports  (or
          similar  reports)  which the Company is required to file with the
          Securities  and  Exchange  Commission  of the  United  States  of
          America, promptly after the filing thereof;

                    (iv) copies of each annual  report,  quarterly  report,
          special report or proxy statement mailed to substantially  all of
          the  stockholders  of the  Company,  promptly  after the  mailing
          thereof  to  the  stockholders;   

                    (v) immediate  notice of the  occurrence of any Default
          of which the principal  financial officer,  principal  accounting
          officer,   the  Vice-President  and  Treasurer  or  an  Assistant
          Treasurer of the Company shall have knowledge;

                    (vi) as soon as  available  and in any event  within 15
          days after the  Company or any of its ERISA  Affiliates  knows or
          has reason to know that any ERISA Event has occurred, a statement
          of a  senior  officer  of the  Company  with  responsibility  for
          compliance with the  requirements of ERISA  describing such ERISA
          Event and the  action,  if any,  which the  Company or such ERISA
          Affiliate proposes to take with respect thereto;

                    (vii) at the request of any Lender,  promptly after the
          filing  thereof  with the  Internal  Revenue  Service,  copies of
          Schedule B (Actuarial  Information)  to each annual  report (Form
          5500 series) filed by the Company or any of its ERISA  Affiliates
          with respect to each Plan;  

                    (viii) promptly after receipt thereof by the Company or
          any of its ERISA Affiliates, copies of each notice from the PBGC
          stating its intention to terminate any Plan or to have a trustee
          appointed to administer any Plan;

                    (ix) promptly after such request,  such other documents
          and information relating to any Plan as any Lender may reasonably
          request from time to time;

                    (x) promptly and in any event within five Business Days
          after  receipt  thereof  by the  Company  or  any  of  its  ERISA
          Affiliates  from the sponsor of a Multiemployer  Plan,  copies of
          each  notice  concerning  (A) (x) the  imposition  of  Withdrawal
          Liability  in an amount in excess of  $5,000,000  with respect to
          any one Multiemployer Plan or in an aggregate amount in excess of
          $25,000,000 with respect to all such  Multiemployer  Plans within
          any one calendar year or (y) the  reorganization  or termination,
          within  the  meaning of Title IV of ERISA,  of any  Multiemployer
          Plan that has resulted or might  reasonably be expected to result
          in  Withdrawal  Liability in an amount in excess of $5,000,000 or
          of all  such  Multiemployer  Plans  that  has  resulted  or might
          reasonably  be expected to result in  Withdrawal  Liability in an
          aggregate amount in excess of $25,000,000 within any one calendar
          year and (B) the  amount of  liability  incurred,  or that may be
          incurred,  by the  Company  or any of  its  ERISA  Affiliates  in
          connection with any event described in such subclause (x) or (y);

                    (xi) promptly after the commencement thereof, notice of
          all actions and proceedings before any court, governmental agency
          or arbitrator affecting the Borrower or any Designated Subsidiary
          of the type described in Section 4.01(f); and

                    (xii)  from  time  to  time  such  further  information
          respecting the financial  condition and operations of the Company
          and  its  Subsidiaries  as any  Lender  may  from  time  to  time
          reasonably request.

          (i) Authorizations.  Obtain, and cause each Designated Subsidiary
     to  obtain,  at any  time and  from  time to time all  authorizations,
     licenses, consents or approvals (including exchange control approvals)
     as shall now or hereafter be necessary or desirable  under  applicable
     law or  regulations in connection  with its making and  performance of
     this Agreement and, upon the request of any Lender,  promptly  furnish
     to such Lender copies thereof.

          (j) Compliance with Environmental Laws. Comply, and cause each of
     its  Subsidiaries  and all  lessees  and other  Persons  operating  or
     occupying its properties to comply, in all material respects, with all
     applicable  Environmental Laws and Environmental  Permits;  obtain and
     renew  and cause  each of its  Subsidiaries  to  obtain  and renew all
     Environmental Permits necessary for its operations and properties; and
     conduct,   and  cause  each  of  its  Subsidiaries  to  conduct,   any
     investigation, study, sampling and testing, and undertake any cleanup,
     removal, remedial or other action necessary to remove and clean up all
     Hazardous Materials from any of its properties, in accordance with the
     requirements  of  all  Environmental  Laws;  provided,  however,  that
     neither the Company nor any of its  Subsidiaries  shall be required to
     undertake any such cleanup,  removal,  remedial or other action to the
     extent that its  obligation to do so is being  contested in good faith
     and  by  proper   proceedings  and  appropriate   reserves  are  being
     maintained with respect to such circumstances.

          (k) Change of Control. If a Change of Control shall occur, within
     ten calendar days after the occurrence thereof, provide the Agent with
     notice thereof,  describing therein in reasonable detail the facts and
     circumstances giving rise to such Change in Control.

          SECTION 5.02.  Negative  Covenants.  So long as any Advance shall
remain  unpaid or any  Lender  shall  have any  Commitment  hereunder,  the
Company will not:

          (a) Liens, Etc. Issue, assume or guarantee,  or permit any of its
     Subsidiaries owning Restricted Property to issue, assume or guarantee,
     any  Debt  secured  by  Liens  on or with  respect  to any  Restricted
     Property  without  effectively  providing that its  obligations to the
     Lenders  under this  Agreement  and any of the Notes  shall be secured
     equally  and  ratably  with such Debt so long as such Debt shall be so
     secured, except that the foregoing shall not apply to:

                    (i) Liens  affecting  property of the Company or any of
          its  Subsidiaries  existing on the Effective Date in effect as of
          the date  hereof or of any  corporation  existing  at the time it
          becomes a  Subsidiary  of the Company or at the time it is merged
          into or  consolidated  with the  Company or a  Subsidiary  of the
          Company;

                    (ii)  Liens  on   property   of  the   Company  or  its
          Subsidiaries  existing  at the  time of  acquisition  thereof  or
          incurred  to secure the  payment  of all or part of the  purchase
          price thereof or to secure Debt incurred prior to, at the time of
          or within 24 months after acquisition  thereof for the purpose of
          financing all or part of the purchase price thereof;

                    (iii)   Liens  on   property  of  the  Company  or  its
          Subsidiaries  (in the case of property that is, in the opinion of
          the Board of Directors of the Company,  substantially  unimproved
          for the use intended by the Company) to secure all or part of the
          cost of  improvement  thereof,  or to  secure  Debt  incurred  to
          provide funds for any such purpose;  

                    (iv) Liens which secure only Debt owing by a Subsidiary
          of the  Company to the  Company or to another  Subsidiary  of the
          Company;

                    (v) Liens in favor of the United States of America, any
          State,   any  foreign   country,   or  any  department,   agency,
          instrumentality,   or   political   subdivisions   of  any   such
          jurisdiction,  to  secure  partial,  progress,  advance  or other
          payments  pursuant  to any  contract  or statute or to secure any
          Debt incurred for the purpose of financing all or any part of the
          purchase price or cost of  constructing or improving the property
          subject thereto, including,  without limitation,  Liens to secure
          Debt of the pollution control or industrial revenue bond type; or

                    (vi)  any  extension,   renewal  or   replacement   (or
          successive extensions,  renewals or replacements), in whole or in
          part, of any Lien referred to in the foregoing clauses (i) to (v)
          inclusive  of  any  Debt  secured  thereby,   provided  that  the
          principal  amount of Debt  secured  thereby  shall not exceed the
          principal  amount  of  Debt  so  secured  at  the  time  of  such
          extension,  renewal  or  replacement,  and that  such  extension,
          renewal  or  replacement  Lien shall be limited to all or part of
          the property which secured the Lien extended, renewed or replaced
          (plus improvements on such property);

     provided,  however, that, the Company and any one or more Subsidiaries
     owning Restricted Property may issue, assume or guarantee Debt secured
     by  Liens  which  would   otherwise   be  subject  to  the   foregoing
     restrictions in an aggregate principal amount which, together with the
     aggregate  outstanding  principal  amount  of all  other  Debt  of the
     Company and its  Subsidiaries  owning  Restricted  Property that would
     otherwise be subject to the foregoing restrictions (not including Debt
     permitted  to be secured  under clause (i) through (vi) above) and the
     aggregate value of the Sale and Leaseback Transactions in existence at
     such time,  does not at any one time  exceed  10% of the Net  Tangible
     Assets of the Company and its Consolidated Subsidiaries;  and provided
     further that the following type of  transaction,  among others,  shall
     not be deemed to create Debt secured by Liens:  Liens  required by any
     contract  or  statute  in order to permit  the  Company  or any of its
     Subsidiaries to perform any contract or subcontract made by it with or
     at the request of the United States of America, any foreign country or
     any  department,  agency or  instrumentality  of any of the  foregoing
     jurisdictions.

          (b) Mergers,  Etc. Merge or consolidate  with or into, or convey,
     transfer, lease or otherwise dispose of (whether in one transaction or
     in a series of transactions)  all or  substantially  all of its assets
     (whether now owned or hereafter  acquired)  to, any Person;  provided,
     however,  that the  Company  may merge or  consolidate  with any other
     Person so long as the Company is the surviving corporation and so long
     as no Default  shall have  occurred and be  continuing  at the time of
     such proposed transaction or would result therefrom.

          (c)  Minimum  Net  Worth.  At any  time,  permit  the  amount  of
     Consolidated  total assets in excess of Consolidated total liabilities
     to be less than $3,100,000,000.

          (d) Indebtedness of Domestic  Subsidiaries.  Permit the amount of
     Debt  incurred by its Domestic  Subsidiaries  to exceed  $500,000,000;
     provided,  however,  that  the  following  shall  not be  included  in
     determining compliance with this Section 5.02(d):

                    (i) Debt of a Domestic  Subsidiary  of the Company owed
          to the Company or another Subsidiary of the Company;

                    (ii) Debt existing on the Effective Date (the "Existing
          Debt"),  and any Debt  extending  the maturity of, or renewing or
          replacing (or successive  extensions,  renewals or replacements),
          in whole or in part, such Debt; and

                    (iii) Debt  incurred  by a Domestic  Subsidiary  of the
          Company  prior to the date it became a Subsidiary  of the Company
          (and  any  extension,   renewal  or  replacement  (or  successive
          extensions,  renewals  or  replacements)  in  whole  of  in  part
          thereof).

                                 ARTICLE VI

                             EVENTS OF DEFAULT

          SECTION 6.01.  Events of Default.  If any of the following events
("Events of Default") shall occur and be continuing:

          (a) Any  Borrower  shall fail to pay:  (i) any  principal  of any
     Advance when the same becomes due and payable; (ii) any facility fees,
     utilization  fees or any  interest on any Advance  payable  under this
     Agreement  or any Note  within  three  Business  Days  after  the same
     becomes  due and  payable;  or (iii) any other  fees or other  amounts
     payable  under this  Agreement  or any Notes  within 30 days after the
     same  becomes  due and  payable  other than those fees and amounts the
     liabilities  for  which  are  being  contested  in good  faith by such
     Borrower and which have been placed in Escrow by such Borrower; or

          (b) Any  representation  or warranty made (or deemed made) by any
     Borrower (or any of its officers) in connection with this Agreement or
     by any Designated  Subsidiary in the  Designation  Letter  pursuant to
     which such  Designated  Subsidiary  became a Borrower  hereunder shall
     prove to have been  incorrect  in any  material  respect when made (or
     deemed made); or

          (c) The Company shall repudiate its  obligations  under, or shall
     default in the due performance or observance of, any term, covenant or
     agreement contained in Article VII of this Agreement; or

          (d) (i) The  Company  shall fail to perform or observe  any other
     term,  covenant or agreement  contained in Section  5.02(a) or (c) and
     such failure shall remain unremedied for a period of 30 days after any
     Lender  shall have given  notice  thereof to the Company  (through the
     Agent),  or (ii) the  Company  or any  other  Borrower  shall  fail to
     perform or to observe any other term,  covenant or agreement contained
     in this  Agreement  on its part to be  performed  or observed and such
     failure  shall  remain  unremedied  for a period of 30 days  after any
     Lender shall have given notice thereof to the relevant Borrower or, in
     the case of the Company,  any of the principal financial officer,  the
     principal  accounting officer,  the Vice-President and Treasurer or an
     Assistant  Treasurer  of the  Company,  and in the  case of any  other
     Borrower, a responsible officer of such Borrower,  first has knowledge
     of such failure; or

          (e) (i) The  Company  or any of its  Consolidated  or  Designated
     Subsidiaries shall fail to pay any principal of or premium or interest
     on any Debt (other  than Debt owed to the Company or its  Subsidiaries
     or Affiliates)  that is outstanding in a principal  amount of at least
     $100,000,000   in  the  aggregate  (but  excluding  Debt   outstanding
     hereunder  and  Debt  owed  by  such  party  to  any  bank,  financial
     institution or other  institutional  lender to the extent the Borrower
     or any Subsidiary has deposits with such bank,  financial  institution
     or other  institutional  lender  sufficient to repay such Debt) of the
     Company or such Subsidiary (as the case may be), when the same becomes
     due and payable (whether by scheduled maturity,  required  prepayment,
     acceleration,  demand or  otherwise),  and such failure shall continue
     after the applicable grace period, if any,  specified in the agreement
     or  instrument  relating  to such Debt,  or (ii) any other event shall
     occur or  condition  shall exist  under any  agreement  or  instrument
     relating  to any such Debt and  shall  continue  after the  applicable
     grace period,  if any,  specified in such agreement or instrument,  if
     the effect of such event or condition is to  accelerate,  or to permit
     the acceleration of, the maturity of such Debt, or (iii) any such Debt
     shall be declared to be due and payable,  or required to be prepaid or
     redeemed (other than by a regularly  scheduled required  prepayment or
     redemption),  purchased  or defeased,  or an offer to prepay,  redeem,
     purchase or defease  such Debt shall be  required to be made,  in each
     case prior to the stated maturity thereof;  provided,  however,  that,
     for purposes of this Section  6.0l(e),  in the case of (x) Debt of any
     Person   (other   than  the   Company  or  one  of  its   Consolidated
     Subsidiaries) which the Company has guaranteed and (y) Debt of Persons
     (other than the Company or one of its Consolidated  Subsidiaries)  the
     payment of which is secured by a Lien on  property  of the  Company or
     such Subsidiary,  such Debt shall be deemed to have not been paid when
     due or to have  been  declared  to be due and  payable  only  when the
     Company or such  Subsidiary,  as the case may be, shall have failed to
     pay when due any  amount  which  it  shall  be  obligated  to pay with
     respect to such Debt;  provided  further,  however,  that any event or
     occurrence  described in this  subsection (e) shall not be an Event of
     Default  if (A) such  event or  occurrence  relates to the Debt of any
     Subsidiary of the Company located in China, India, the Commonwealth of
     Independent States or Turkey  (collectively,  the "Exempt Countries"),
     (B)  such  Debt  is  not   guaranteed  or  supported  in  any  legally
     enforceable  manner by any Borrower or by any  Subsidiary or Affiliate
     of the Company located outside the Exempt Countries, (C) such event or
     occurrence is due to the direct or indirect  action of any  government
     entity or agency in any Exempt  Country  and (D) as of the last day of
     the calendar quarter  immediately  preceding such event or occurrence,
     the book  value  of the  assets  of such  Subsidiary  does not  exceed
     $80,000,000  and  the  aggregate  book  value  of  the  assets  of all
     Subsidiaries  of the Company  located in Exempt  Countries the Debt of
     which  would  cause an Event of Default to occur but for the effect of
     this proviso does not exceed $300,000,000; or

          (f)  The  Company  or  any  of  its  Designated  or  Consolidated
     Subsidiaries  shall  generally  not pay its debts as such debts become
     due,  or  shall  admit  in  writing  its  inability  to pay its  debts
     generally,  or shall  make a general  assignment  for the  benefit  of
     creditors;  or any  proceeding  shall be  instituted by or against the
     Company or any such  Subsidiaries  seeking to adjudicate it a bankrupt
     or  insolvent,  or seeking  liquidation,  winding up,  reorganization,
     arrangement,  adjustment,  protection, relief, or composition of it or
     its  debts  under  any  law  relating  to  bankruptcy,  insolvency  or
     reorganization or relief of debtors,  or seeking the entry of an order
     for relief or the  appointment  of a receiver,  trustee,  custodian or
     other  similar  official  for it or for  any  substantial  part of its
     property and, in the case of any such proceeding instituted against it
     (but not  instituted  by it),  either  such  proceeding  shall  remain
     undismissed or unstayed for a period of 30 days, or any of the actions
     sought in such proceeding (including, without limitation, the entry of
     an  order  for  relief  against,  or the  appointment  of a  receiver,
     trustee,  custodian  or  other  similar  official  for,  it or for any
     substantial  part of its property)  shall occur; or the Company or any
     such Subsidiaries  shall take any corporate action to authorize any of
     the actions set forth above in this subsection (f); provided, however,
     that any event or occurrence  described in this  subsection  (f) shall
     not be an Event of Default if (A) such event or occurrence  relates to
     any Subsidiary of the Company  located in an Exempt  Country,  (B) the
     Debt of such  Subsidiary is not guaranteed or supported in any legally
     enforceable  manner by any Borrower or by any  Subsidiary or Affiliate
     of the Company located outside the Exempt Countries, (C) such event or
     occurrence is due to the direct or indirect  action of any  government
     entity or agency in any Exempt  Country  and (D) as of the last day of
     the calendar quarter  immediately  preceding such event or occurrence,
     the book  value  of the  assets  of such  Subsidiary  does not  exceed
     $80,000,000  and  the  aggregate  book  value  of  the  assets  of all
     Subsidiaries of the Company  located in Exempt  Countries with respect
     to which the happening of the events or occurrences  described in this
     subsection  (f) would  cause an Event of  Default to occur but for the
     effect of this proviso does not exceed $300,000,000; or

          (g) Any  judgment  or order for the payment of money in excess of
     $100,000,000  shall be  rendered  against  the  Company  or any of its
     Subsidiaries and enforcement  proceedings shall have been commenced by
     any creditor upon such judgment or order and there shall be any period
     of 10  consecutive  days during  which a stay of  enforcement  of such
     judgment or order,  by reason of a pending appeal or otherwise,  shall
     not be in effect;  provided,  however, that any such judgment or order
     shall not be an Event of  Default  under this  Section  6.01(g) if (A)
     such  judgment or order is  rendered  against  any  Subsidiary  of the
     Company located in an Exempt Country,  (B) the Debt of such Subsidiary
     is not  guaranteed or supported in any legally  enforceable  manner by
     any Borrower or by any Subsidiary or Affiliate of the Company  located
     outside the Exempt Countries, (C) such judgment or order is due to the
     direct or indirect  action of any  government  entity or agency in any
     Exempt  Country  and (D) as of the  last day of the  calendar  quarter
     immediately  preceding  the tenth  consecutive  day of the stay period
     referred  to above,  the book value of the  assets of such  Subsidiary
     does not exceed $80,000,000 and the aggregate book value of the assets
     of all  Subsidiaries  of the Company  located in Exempt  Countries the
     judgments and orders  against which would cause an Event of Default to
     occur but for the effect of this proviso does not exceed $300,000,000;
     or

          (h) Any non-monetary  judgment or order shall be rendered against
     the Company or any of its  Subsidiaries  that is reasonably  likely to
     have a Material Adverse Effect, and enforcement proceedings shall have
     been  commenced  by any Person  upon such  judgment or order and there
     shall be any  period of 10  consecutive  days  during  which a stay of
     enforcement  of such judgment or order,  by reason of a pending appeal
     or otherwise, shall not be in effect; or

          (i) Any license,  consent,  authorization or approval  (including
     exchange control  approvals) now or hereafter  necessary to enable the
     Company or any  Designated  Subsidiary to comply with its  obligations
     herein or under any Notes of such Borrower shall be modified, revoked,
     withdrawn, withheld or suspended; or

          (j) (i) Any ERISA Event  shall have  occurred  with  respect to a
     Plan  of any  Borrower  or any of its  ERISA  Affiliates  and  the sum
     (determined  as of the date of  occurrence of such ERISA Event) of the
     Insufficiency of such Plan and the  Insufficiency of any and all other
     Plans of the  Borrowers  and their ERISA  Affiliates  with  respect to
     which an ERISA  Event  shall  have  occurred  and then  exist  (or the
     liability of the Borrowers and their ERISA Affiliates  related to such
     ERISA Event) exceeds $100,000,000;  or (ii) any Borrower or any of its
     ERISA Affiliates shall be in default, as defined in Section 4219(c)(5)
     of ERISA, with respect to any payment of Withdrawal  Liability and the
     sum of the outstanding  balance of such  Withdrawal  Liability and the
     outstanding  balance  of  any  other  Withdrawal  Liability  that  any
     Borrower or any of its ERISA Affiliates has incurred exceeds 6% of Net
     Tangible Assets of the Company and its Consolidated  Subsidiaries;  or
     (iii) any  Borrower  or any of its ERISA  Affiliates  shall  have been
     notified by the sponsor of a  Multiemployer  Plan of such  Borrower or
     any of  its  ERISA  Affiliates  that  such  Multiemployer  Plan  is in
     reorganization or is being terminated,  within the meaning of Title IV
     of ERISA,  and as a result of such  reorganization  or termination the
     aggregate  annual  contributions  of the  Borrowers  and  their  ERISA
     Affiliates to all Multiemployer  Plans that are then in reorganization
     or being  terminated  have been or will be increased  over the amounts
     contributed  to such  Multiemployer  Plans for the plan  years of such
     Multiemployer Plans immediately  preceding the plan year in which such
     reorganization   or   termination   occurs  by  an  amount   exceeding
     $100,000,000; or

then,  and (i) in any such event (except as provided in clause (ii) below),
the  Agent  (A)  shall at the  request,  or may with  the  consent,  of the
Majority Lenders, by notice to the Company,  declare the obligation of each
Lender  to  make  Advances  to be  terminated,  whereupon  the  same  shall
forthwith terminate, and (B) shall at the request, or may with the consent,
of the Majority  Lenders,  by notice to the Company,  declare the Advances,
all interest  thereon and all other amounts payable under this Agreement to
be forthwith due and payable, whereupon the Advances, all such interest and
all such amounts  shall become and be  forthwith  due and payable,  without
presentment,  demand,  protest or further  notice of any kind, all of which
are hereby  expressly  waived by the  Borrowers and (ii) in the case of the
occurrence  of any Event of  Default  described  in  clause  (i) or (ii) of
Section 6.01(a),  the Agent shall, at the request, or may with the consent,
of the Lenders  which have made or assumed  under this  Agreement  at least
66-2/3% of the aggregate  principal amount (based in respect of Competitive
Bid Advances denominated in Foreign Currencies on the Equivalent in Dollars
on the date of such request) of Competitive  Bid Advances then  outstanding
and to whom such Advances are owed,  by notice to the Company,  declare the
full unpaid  principal  of and  accrued  interest  on all  Competitive  Bid
Advances hereunder and all other obligations of the Borrowers  hereunder to
be  immediately   due  and  payable,   whereupon  such  Advances  and  such
obligations  shall be  immediately  due and payable,  without  presentment,
demand,  protest  or other  further  notice of any  kind,  all of which are
hereby expressly waived by the Borrowers;  provided,  however,  that in the
event of an actual or deemed  entry of an order for relief with  respect to
any Borrower under the United States  Bankruptcy  Code of 1978, as amended,
(x) the obligation of each Lender to make Advances shall  automatically  be
terminated  and (y) the  Advances,  all such  interest and all such amounts
shall  automatically  become and be due and payable,  without  presentment,
demand,  protest  or any  notice  of any  kind,  all of  which  are  hereby
expressly waived by the Borrowers.

                                ARTICLE VII

                                 GUARANTEE

          SECTION    7.01.    Unconditional    Guarantee.    For   valuable
consideration,  receipt whereof is hereby acknowledged,  and to induce each
Lender to make Advances to the  Designated  Subsidiaries  and to induce the
Agent to act hereunder,  the Company hereby unconditionally and irrevocably
guarantees to each Lender and the Agent that:

          (a)  the  principal  of and  interest  on  each  Advance  to each
     Designated Subsidiary shall be promptly paid in full when due (whether
     at stated  maturity,  by acceleration or otherwise) in accordance with
     the terms hereof, and, in case of any extension of time of payment, in
     whole or in  part,  of such  Advance,  that  all  such  sums  shall be
     promptly paid when due (whether at stated maturity, by acceleration or
     otherwise) in accordance with the terms of such extension; and

          (b)  all  other  amounts  payable  hereunder  by  any  Designated
     Subsidiary  to any Lender or the Agent or the  Sub-Agent,  as the case
     may be, shall be promptly paid in full when due in accordance with the
     terms hereof (the  obligations  of the Designated  Subsidiaries  under
     these  subsections  (a)  and  (b)  of  this  Section  7.01  being  the
     "Obligations").

In addition, the Company hereby unconditionally and irrevocably agrees that
upon  default in the  payment  when due  (whether  at stated  maturity,  by
acceleration or otherwise) of any principal of, or interest on, any Advance
to  any  Designated  Subsidiary  or  such  other  amounts  payable  by  any
Designated  Subsidiary  to  any  Lender  or the  Agent,  the  Company  will
forthwith pay the same, without further notice or demand.

          SECTION 7.02. Guarantee Absolute. The Company guarantees that the
Obligations  will be paid  strictly  in  accordance  with the terms of this
Agreement,  regardless of any law,  regulation or order now or hereafter in
effect in any jurisdiction affecting any of such terms or the rights of any
Lender or the Agent with  respect  thereto.  The  liability  of the Company
under this guarantee shall be absolute and unconditional irrespective of:

          (a) any lack of validity or  enforceability  of this Agreement or
     any other agreement or instrument relating thereto;

          (b) any change in the time,  manner or place of payment of, or in
     any  other  term  of,  all or any of  the  Obligations,  or any  other
     amendment or waiver of or any consent to departure from this Agreement
     (including,  without limitation, any extension of the Termination Date
     pursuant to Section 2.16);

          (c) any exchange, release or non-perfection of any collateral, or
     any release or amendment or waiver of or consent to departure from any
     other guaranty, for all or any of the Obligations; or

          (d) any other  circumstance  which might  otherwise  constitute a
     defense available to, or a discharge of, the Company,  any Borrower or
     a guarantor.

This guarantee shall continue to be effective or be reinstated, as the case
may be, if at any time any payment of any of the  Obligations  is rescinded
or must  otherwise  be returned by any of the Lenders or the Agent upon the
insolvency,  bankruptcy or reorganization of the Company or any Borrower or
otherwise, all as though such payment had not been made.

          SECTION  7.03.  Waivers.  The  Company  hereby  expressly  waives
diligence,  presentment,  demand for payment, protest, any requirement that
any  right  or power be  exhausted  or any  action  be  taken  against  any
Designated  Subsidiary or against any other guarantor of all or any portion
of the Advances, and all other notices and demands whatsoever.

          SECTION  7.04.  Remedies.  Each of the  Lenders and the Agent may
pursue its respective  rights and remedies under this Article VII and shall
be entitled to payment hereunder notwithstanding any other guarantee of all
or  any  part  of  the  Advances  to  the  Designated   Subsidiaries,   and
notwithstanding any action taken by any such Lender or the Agent to enforce
any of its rights or remedies  under such other  guarantee,  or any payment
received  thereunder.  The Company hereby  irrevocably  waives any claim or
other right that it may now or  hereafter  acquire  against any  Designated
Subsidiary  that  arises  from  the  existence,   payment,  performance  or
enforcement of the Company's obligations under this Article VII, including,
without limitation, any right of subrogation,  reimbursement,  exoneration,
contribution or  indemnification  and any right to participate in any claim
or remedy of the Agent or the Lenders  against any  Designated  Subsidiary,
whether  or not such  claim,  remedy  or right  arises  in  equity or under
contract,  statute or common law, including,  without limitation, the right
to take or receive from the Designated Subsidiary,  directly or indirectly,
in cash or other property or by set-off or in any other manner,  payment or
security on account of such claim,  remedy or right. If any amount shall be
paid to the Company in violation of the preceding sentence at any time when
all the Obligations  shall not have been paid in full, such amount shall be
held in trust  for the  benefit  of the  Lenders  and the  Agent  and shall
forthwith  be paid to the Agent for its own account and the accounts of the
respective  Lenders to be credited and applied to the Obligations,  whether
matured or unmatured, in accordance with the terms of this Agreement, or to
be held as collateral for any  Obligations  or other amounts  payable under
this Agreement  thereafter arising.  The Company  acknowledges that it will
receive  direct  and  indirect  benefits  from the  financing  arrangements
contemplated  by this  Agreement  and that  the  waiver  set  forth in this
section is knowingly made in contemplation of such benefits.

          SECTION  7.05. No Stay.  The Company  agrees that, as between (a)
the  Company  and (b) the Lenders  and the Agent,  the  Obligations  of any
Designated  Subsidiary  guaranteed by the Company hereunder may be declared
to be  forthwith  due and  payable  as  provided  in  Article VI hereof for
purposes of this  Article VII by  declaration  to the Company as  guarantor
notwithstanding any stay,  injunction or other prohibition  preventing such
declaration as against such Designated Subsidiary and that, in the event of
such declaration to the Company as guarantor,  such Obligations (whether or
not due and payable by such Designated Subsidiary),  shall forthwith become
due and payable by the Company for purposes of this Article VII.

          SECTION 7.06. Survival.  This guarantee is a continuing guarantee
and shall (a) remain in full force and effect until  payment in full (after
the  Termination  Date) of the  Obligations  and all other amounts  payable
under this  guaranty,  (b) be binding upon the Company,  its successors and
assigns,  (c) inure to the  benefit of and be  enforceable  by each  Lender
(including  each  Assuming  Lender and each  assignee  Lender  pursuant  to
Section 9.07) and the Agent and their  respective  successors,  transferees
and  assigns  and (d) shall be  reinstated  if at any time any payment to a
Lender or the Agent  hereunder is required to be restored by such Lender or
the Agent.  Without  limiting the  generality of the foregoing  clause (c),
each Lender may assign or otherwise transfer its interest in any Advance to
any other person or entity, and such other person or entity shall thereupon
become vested with all the rights in respect thereof granted to such Lender
herein or otherwise.

                                ARTICLE VIII

                                 THE AGENT

          SECTION  8.01.  Authorization  and  Action.  Each  Lender  hereby
appoints  and  authorizes  the  Agent to take  such  action as agent on its
behalf and to exercise such powers and  discretion  under this Agreement as
are delegated to the Agent by the terms  hereof,  together with such powers
and discretion as are reasonably  incidental thereto. As to any matters not
expressly provided for by this Agreement  (including,  without  limitation,
enforcement or collection of the Notes), the Agent shall not be required to
exercise any discretion or take any action, but shall be required to act or
to  refrain  from  acting  (and  shall be fully  protected  in so acting or
refraining from acting) upon the instructions of the Majority Lenders,  and
such  instructions  shall be binding  upon all  Lenders  and all holders of
Notes; provided,  however, that the Agent shall not be required to take any
action that exposes the Agent to personal  liability or that is contrary to
this  Agreement or applicable  law. The Agent agrees to give to each Lender
prompt  notice of each notice given to it by any  Borrower  pursuant to the
terms of this Agreement.

          SECTION 8.02. Agent's Reliance, Etc. Neither the Agent nor any of
its directors, officers, agents or employees shall be liable for any action
taken or omitted to be taken by it or them under or in connection with this
Agreement,  except  for  its or  their  own  gross  negligence  or  willful
misconduct.  Without  limitation of the  generality of the  foregoing,  the
Agent:  (a) may treat the Lender that made any Advance as the holder of the
Debt resulting therefrom until the Agent receives and accepts an Assignment
and Acceptance  entered into by such Lender,  as assignor,  and an Eligible
Assignee,  as assignee,  as provided in Section 9.07;  (b) may consult with
legal  counsel  (including  counsel for the  Company),  independent  public
accountants  and other  experts  selected by it and shall not be liable for
any action  taken or omitted to be taken in good faith by it in  accordance
with the  advice of such  counsel,  accountants  or  experts;  (c) makes no
warranty or  representation  to any Lender and shall not be  responsible to
any Lender  for any  statements,  warranties  or  representations  (whether
written or oral) made in or in connection  with this  Agreement;  (d) shall
not have any duty to  ascertain  or to  inquire  as to the  performance  or
observance of any of the terms,  covenants or conditions of this  Agreement
on the part of any Borrower or to inspect the property (including the books
and records) of any Borrower;  (e) shall not be  responsible  to any Lender
for the due execution,  legality,  validity,  enforceability,  genuineness,
sufficiency or value of this Agreement or any other  instrument or document
furnished  pursuant  hereto;  and (f) shall incur no liability  under or in
respect of this Agreement by acting upon any notice,  consent,  certificate
or other  instrument or writing  (which may be by  telecopier,  telegram or
telex)  believed by it to be genuine and signed or sent by the proper party
or parties.

          SECTION  8.03.  Citibank  and  Affiliates.  With  respect  to its
Commitment,  the  Advances  made by it and the Note issued to it,  Citibank
shall have the same  rights and powers  under this  Agreement  as any other
Lender and may exercise  the same as though it were not the Agent;  and the
term "Lender" or "Lenders"  shall,  unless otherwise  expressly  indicated,
include  Citibank in its individual  capacity.  Citibank and its Affiliates
may accept  deposits from,  lend money to, act as trustee under  indentures
of, accept investment banking  engagements from and generally engage in any
kind of business with, the Company,  any of its Subsidiaries and any Person
who may do  business  with or own  securities  of the  Company  or any such
Subsidiary,  all as if Citibank  were not the Agent and without any duty to
account therefor to the Lenders.

          SECTION 8.04.  Lender Credit Decision.  Each Lender  acknowledges
that it has, independently and without reliance upon the Agent or any other
Lender and based on the  financial  statements  referred to in Section 4.01
and such other documents and information as it has deemed appropriate, made
its own credit  analysis  and decision to enter into this  Agreement.  Each
Lender also acknowledges  that it will,  independently and without reliance
upon  the  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 this Agreement.

          SECTION 8.05. Indemnification. The Lenders agree to indemnify the
Agent (to the extent not  reimbursed by a Borrower),  ratably  according to
the respective principal amounts of the Revolving Credit Notes then held by
each of them (or if no Revolving  Credit Notes are at the time  outstanding
or if any Revolving  Credit Notes are held by Persons that are not Lenders,
ratably according to the respective amounts of their Commitments), from and
against any and all liabilities,  obligations,  losses, damages, penalties,
actions,  judgments, suits, costs, expenses or disbursements of any kind or
nature  whatsoever that may be imposed on, incurred by, or asserted against
the Agent in any way  relating to or arising out of this  Agreement  or any
action taken or omitted by the Agent under this Agreement, provided that no
Lender  shall be liable for any portion of such  liabilities,  obligations,
losses, damages,  penalties,  actions, judgments, suits, costs, expenses or
disbursements  resulting  from the  Agent's  gross  negligence  or  willful
misconduct.  Without  limitation  of the  foregoing,  each Lender agrees to
reimburse  the Agent  promptly  upon  demand for its  ratable  share of any
out-of-pocket  expenses  (including  counsel fees) incurred by the Agent in
connection  with  the  preparation,  execution,  delivery,  administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings  or  otherwise)  of, or legal  advice in  respect  of rights or
responsibilities under, this Agreement, to the extent that the Agent is not
reimbursed for such expenses by a Borrower.

          SECTION 8.06.  Successor  Agent. The Agent may resign at any time
by giving  written notice thereof to the Lenders and the Company and may be
removed  at any time with or without  cause by the  Majority  Lenders.  The
Company may at any time, by notice to the Agent,  propose a successor Agent
(which shall meet the criteria  described  below)  specified in such notice
and request  that the Lenders be notified  thereof by the Agent with a view
to their  removal  of the  Agent and their  appointment  of such  successor
Agent;  the Agent agrees to forward any such notice to the Lenders promptly
upon its receipt by the Agent.  Upon any such  resignation or removal,  the
Majority  Lenders shall have the right to appoint a successor  Agent. If no
successor Agent shall have been so appointed by the Majority  Lenders,  and
shall have  accepted  such  appointment,  within 30 days after the retiring
Agent's giving of notice of resignation or the Majority Lenders' removal of
the retiring Agent,  then the retiring Agent may, on behalf of the Lenders,
appoint a successor Agent, which shall be a commercial bank organized under
the laws of the United States of America or of any State thereof and having
a  combined  capital  and  surplus  of  at  least  $500,000,000.  Upon  the
acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall  thereupon  succeed to and become vested with all the
rights,  powers,  discretion,  privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged  from its duties and obligations
under this  Agreement.  After any retiring  Agent's  resignation or removal
hereunder as Agent,  the provisions of this Article VIII shall inure to its
benefit as to any  actions  taken or omitted to be taken by it while it was
Agent under this Agreement.

          SECTION 8.07. Sub-Agent.  The Sub-Agent has been designated under
this  Agreement to carry out duties of the Agent.  The  Sub-Agent  shall be
subject to each of the obligations in this Agreement to be performed by the
Sub-Agent,  and  each of the  Borrowers  and the  Lenders  agrees  that the
Sub-Agent  shall be entitled  to  exercise  each of the rights and shall be
entitled  to each of the  benefits  of the Agent  under this  Agreement  as
relate to the performance of its obligations hereunder.

                                 ARTICLE IX

                               MISCELLANEOUS

          SECTION  9.01.  Amendments,  Etc. No  amendment  or waiver of any
provision of this Agreement or the Revolving  Credit Notes,  nor consent to
any  departure by any Borrower  therefrom,  shall in any event be effective
unless the same shall be in writing and signed by the Majority Lenders, and
then  such  waiver  or  consent  shall be  effective  only in the  specific
instance and for the specific purpose for which given;  provided,  however,
that no amendment, waiver or consent shall, unless in writing and signed by
all the Lenders,  do any of the following:  (a) increase the Commitments of
the  Lenders or subject  the  Lenders to any  additional  obligations,  (b)
reduce the principal of, or interest on, the Revolving  Credit  Advances or
any fees or other amounts  payable  hereunder,  (c) postpone any date fixed
for any payment of  principal  of, or  interest  on, the  Revolving  Credit
Advances  or any fees or other  amounts  payable  hereunder  (other than as
permitted  by Section 2.16 to the extent any Lender  consents  thereunder),
(d) release the Company from any of its  obligations  under  Article VII or
(e)  require the  duration of an Interest  Period to be nine months if such
period is not  available  to all  Lenders;  and  provided  further  that no
amendment,  waiver or consent  shall,  unless in writing  and signed by the
Agent in addition to the Lenders required above to take such action, affect
the rights or duties of the Agent under this Agreement or any Note.

          SECTION 9.02. Notices,  Etc. All notices and other communications
provided  for  hereunder  shall  be  in  writing   (including   telecopier,
telegraphic or telex  communication) and mailed (return receipt requested),
telecopied,  telegraphed, telexed or delivered, if to the Company or to any
Designated  Subsidiary,  at the  Company's  address at 101  Columbia  Road,
Morristown,  New Jersey 07962-1219,  Attention:  Assistant Treasurer; if to
any Initial Lender,  at its Domestic Lending Office specified  opposite its
name on Schedule I hereto;  if to any other Lender, at its Domestic Lending
Office  specified  in  the  Assumption  Agreement  or  the  Assignment  and
Acceptance  pursuant to which it became a Lender;  and if to the Agent,  at
its address at Two Penns Way, New Castle, Delaware 19720,  Attention:  Bank
Loan Syndications Department, with a copy to 399 Park Avenue, New York, New
York  10043,  Attention:  _______________;  or, as to any  Borrower  or the
Agent,  at such  other  address as shall be  designated  by such party in a
written  notice to the other  parties and, as to each other party,  at such
other address as shall be  designated by such party in a written  notice to
the Company and the Agent. All such notices and communications  shall, when
mailed, telecopied,  telegraphed or telexed, be effective when deposited in
the mails,  telecopied,  delivered to the telegraph company or confirmed by
telex answerback,  respectively,  except that notices and communications to
the Agent pursuant to Article II, III or VIII shall not be effective  until
received by the Agent. Delivery by telecopier of an executed counterpart of
any amendment or waiver of any provision of this  Agreement or the Notes or
of any  Exhibit  hereto to be executed  and  delivered  hereunder  shall be
effective as delivery of a manually executed counterpart thereof.

          SECTION 9.03. No Waiver;  Remedies. No failure on the part of any
Lender  or the Agent to  exercise,  and no delay in  exercising,  any right
hereunder or under any Note shall  operate as a waiver  thereof;  nor shall
any single or partial  exercise  of any such  right  preclude  any other or
further  exercise  thereof or the exercise of any other right. The remedies
herein  provided are cumulative and not exclusive of any remedies  provided
by law.

          SECTION 9.04.  Costs and Expenses.  (a) The Company agrees to pay
on demand  all  costs and  expenses  of the  Agent in  connection  with the
administration, modification and amendment of this Agreement, the Notes and
the  other  documents  to  be  delivered  hereunder,   including,   without
limitation,  (i)  all  due  diligence,   syndication  (including  printing,
distribution  and bank meetings),  transportation,  computer,  duplication,
appraisal,  consultant, and audit expenses and (ii) the reasonable fees and
expenses of counsel for the Agent with respect thereto. The Company further
agrees  to pay on  demand  all  costs  and  expenses  of the  Agent and the
Lenders, if any (including, without limitation, reasonable counsel fees and
expenses),   in   connection   with  the   enforcement   (whether   through
negotiations,  legal proceedings or otherwise) of this Agreement, the Notes
and the other  documents  to be  delivered  hereunder,  including,  without
limitation,  reasonable fees and expenses of counsel for the Agent and each
Lender in  connection  with the  enforcement  of rights  under this Section
9.04(a).

          (b) Each Borrower agrees to indemnify and hold harmless the Agent
and each Lender and each of their Affiliates and their officers, directors,
employees,  agents and advisors  (each,  an  "Indemnified  Party") from and
against any and all  claims,  damages,  losses,  liabilities  and  expenses
(including,  without  limitation,  reasonable fees and expenses of counsel)
that may be  incurred by or  asserted  or awarded  against any  Indemnified
Party,  in each case arising out of or in connection  with or by reason of,
or in connection with the preparation for a defense of, any  investigation,
litigation or proceeding  arising out of, related to or in connection  with
the Notes, this Agreement,  any of the transactions  contemplated herein or
the actual or proposed use of the  proceeds of the Advances  whether or not
such investigation, litigation or proceeding is brought by the Company, its
directors,  shareholders or creditors or an Indemnified  Party or any other
Person or any Indemnified Party is otherwise a party thereto and whether or
not the transactions  contemplated  hereby are  consummated,  except to the
extent any such claim, damage, loss, liability or expense has resulted from
such  Indemnified  Party's  gross  negligence  or willful  misconduct.  The
Company also agrees not to assert any claim against any  Indemnified  Party
on any theory of liability for special, indirect, consequential or punitive
damages arising out of or otherwise  relating to the Notes, this Agreement,
any of the transactions  contemplated  herein or the actual or proposed use
of the proceeds of the Advances.

          (c) If any  payment  of  principal  of,  or  Conversion  of,  any
Eurocurrency  Rate  Advance or LIBO Rate Advance is made by the Borrower to
or for the account of a Lender  other than on the last day of the  Interest
Period for such Advance, as a result of a payment or Conversion pursuant to
Section 2.03(d), 2.05(b), 2.09(a) or (b), 2.11 or 2.16, acceleration of the
maturity of the Notes pursuant to Section 6.01 or for any other reason, the
Borrower  shall,  upon demand by such Lender (with a copy of such demand to
the  Agent),  pay to the Agent for the  account of such  Lender any amounts
required to  compensate  such Lender for any  additional  losses,  costs or
expenses  that it may  reasonably  incur as a  result  of such  payment  or
Conversion,  including,  without  limitation,  any loss  (including loss of
anticipated profits), cost or expense incurred by reason of the liquidation
or  reemployment  of deposits or other funds acquired by any Lender to fund
or maintain such Advance.

          (d) Without  prejudice to the survival of any other  agreement of
the Borrower  hereunder,  the  agreements  and  obligations of the Borrower
contained in Sections 2.10, 2.13 and 9.04 shall survive the payment in full
of principal,  interest and all other amounts  payable  hereunder and under
the Notes and the termination in whole of any Commitment hereunder.

          SECTION  9.05.  Right of  Set-off.  Upon (a) the  occurrence  and
during the  continuance  of any Event of Default  and (b) the making of the
request  or the  granting  of the  consent  specified  by  Section  6.01 to
authorize  the Agent to declare the Notes due and  payable  pursuant to the
provisions  of Section  6.01,  each  Lender and each of its  Affiliates  is
hereby  authorized at any time and from time to time, to the fullest extent
permitted  by law,  to set off and apply any and all  deposits  (general or
special,  time or demand,  provisional or final) at any time held and other
indebtedness  at any time owing by such Lender or such  Affiliate to or for
the  credit  or the  account  of any  Borrower  against  any and all of the
obligations of such Borrower now or hereafter existing under this Agreement
and the Note of such  Borrower  held by such  Lender,  whether  or not such
Lender  shall have made any demand  under this  Agreement  or such Note and
although such obligations may be unmatured.  Each Lender agrees promptly to
notify  the  relevant  Borrower  after any such  set-off  and  application,
provided that the failure to give such notice shall not affect the validity
of  such  set-off  and  application.  The  rights  of each  Lender  and its
Affiliates  under this Section are in addition to other rights and remedies
(including,  without limitation,  other rights of set-off) that such Lender
and its Affiliates may have.

          SECTION  9.06.  Binding  Effect.   This  Agreement  shall  become
effective  (other  than  Sections  2.01 and 2.03,  which  shall only become
effective  upon  satisfaction  of the  conditions  precedent  set  forth in
Section 3.01) when it shall have been executed by the Company and the Agent
and when the Agent  shall have been  notified by each  Initial  Lender that
such Initial  Lender has executed it and  thereafter  shall be binding upon
and inure to the  benefit of each  Borrower,  the Agent and each Lender and
their respective successors and assigns,  except that no Borrower shall not
have the  right to assign  its  rights  hereunder  or any  interest  herein
without the prior written consent of the Lenders.

          SECTION 9.07. Assignments and Participations. (a) Each Lender may
at any time, with notice to the Company prior to making any proposal to any
potential assignee and with the consent of the Company, which consent shall
not be unreasonably  withheld (and shall at any time, if requested to do so
by the Company pursuant to Section 2.05(b),  2.10 or 2.13) assign to one or
more  Persons  all or a portion of its rights  and  obligations  under this
Agreement  (including,   without  limitation,  all  or  a  portion  of  its
Commitment,  the Revolving  Credit  Advances  owing to it and the Revolving
Credit Note or Notes held by it); provided, however, that (i) the Company's
consent  shall  not be  required  (A) in the  case of an  assignment  to an
Affiliate  of such Lender,  provided  that notice  thereof  shall have been
given to the Company and the Agent,  or (B) in the case of an assignment of
the type described in subsection (g) below; (ii) each such assignment shall
be  of a  constant,  and  not a  varying,  percentage  of  all  rights  and
obligations  under this Agreement (other than any right to make Competitive
Bid Advances,  Competitive  Bid Advances  owing to it and  Competitive  Bid
Notes);  (iii)  except  in the  case of an  assignment  to a  Person  that,
immediately prior to such assignment,  was a Lender or an assignment of all
of a Lender's  rights and obligations  under this Agreement,  the amount of
the Commitment of the assigning Lender being assigned pursuant to each such
assignment (determined as of the date of the Assignment and Acceptance with
respect to such  assignment)  shall in no event be less than $10,000,000 or
an  integral  multiple  of  $1,000,000  in excess  thereof;  (iv) each such
assignment  shall be to an Eligible  Assignee;  and (v) the parties to each
such assignment  shall execute and deliver to the Agent, for its acceptance
and recording in the Register, an Assignment and Acceptance,  together with
a processing and recordation fee of $3,500 and, if the assigning  Lender is
not retaining a Commitment hereunder,  any Revolving Credit Note subject to
such assignment. Upon such execution,  delivery,  acceptance and recording,
from  and  after  the  effective  date  specified  in each  Assignment  and
Acceptance, (x) the assignee thereunder shall be a party hereto and, to the
extent  that  rights and  obligations  hereunder  have been  assigned to it
pursuant to such Assignment and Acceptance, have the rights and obligations
of a Lender hereunder and (y) the Lender assignor  thereunder shall, to the
extent  that  rights and  obligations  hereunder  have been  assigned by it
pursuant to such  Assignment and  Acceptance,  relinquish its rights and be
released from its obligations  under this Agreement (and, in the case of an
Assignment  and  Acceptance  covering  all or the  remaining  portion of an
assigning Lender's rights and obligations under this Agreement, such Lender
shall cease to be a party hereto,  provided,  however,  that such assigning
Lender's  rights under  Sections 2.10,  2.13 and 9.04, and its  obligations
under Section 8.05,  shall survive such assignment as to matters  occurring
prior to the effective date of such assignment).

          (b) By executing and delivering an Assignment and Acceptance, the
Lender assignor thereunder and the assignee thereunder confirm to and agree
with each other and the other parties hereto as follows:  (i) other than as
provided in such Assignment and Acceptance,  such assigning Lender makes no
representation  or warranty and assumes no  responsibility  with respect to
any statements, warranties or representations made in or in connection with
this  Agreement  or any other  instrument  or document  furnished  pursuant
hereto or the execution, legality, validity,  enforceability,  genuineness,
sufficiency or value of this Agreement or any other  instrument or document
furnished   pursuant   hereto;   (ii)  such   assigning   Lender  makes  no
representation  or warranty and assumes no  responsibility  with respect to
the financial condition of any Borrower or the performance or observance by
such Borrower of any of its  obligations  under this Agreement or any other
instrument  or document  furnished  pursuant  hereto;  (iii) such  assignee
confirms  that it has  received  a copy of this  Agreement,  together  with
copies of the  financial  statements  referred to in Section  4.01 and such
other  documents and  information as it has deemed  appropriate to make its
own  credit  analysis  and  decision  to enter  into  such  Assignment  and
Acceptance;  (iv) such assignee will,  independently  and without  reliance
upon the Agent, such assigning Lender 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 this  Agreement;  (v) such  assignee  confirms that it is an Eligible
Assignee; (vi) such assignee appoints and authorizes the Agent to take such
action as agent on its behalf and to exercise  such  powers and  discretion
under this  Agreement as are  delegated  to the Agent by the terms  hereof,
together  with such  powers and  discretion  as are  reasonably  incidental
thereto;  and (vii) such assignee agrees that it will perform in accordance
with their terms all of the obligations that by the terms of this Agreement
are required to be performed by it as a Lender.

          (c) Upon its receipt of an Assignment and Acceptance  executed by
an  assigning  Lender and an assignee  representing  that it is an Eligible
Assignee,  together with any Revolving Credit Note or Notes subject to such
assignment,  the Agent shall,  if such  Assignment  and Acceptance has been
completed and is in substantially the form of Exhibit C hereto,  (i) accept
such  Assignment  and  Acceptance,  (ii) record the  information  contained
therein in the Register and (iii) give prompt notice thereof to the Company
and to each other Borrower.

          (d) The  Agent  shall  maintain  at its  address  referred  to in
Section 9.02 a copy of each  Assumption  Agreement and each  Assignment and
Acceptance  delivered  to  and  accepted  by it  and  a  register  for  the
recordation  of the names and  addresses of the Lenders and the  Commitment
of, and principal amount of the Advances owing to, each Lender from time to
time (the "Register").  The entries in the Register shall be conclusive and
binding for all purposes,  absent  manifest  error,  and the Company,  each
other Borrower,  the Agent and the Lenders may treat each Person whose name
is recorded in the Register as a Lender  hereunder for all purposes of this
Agreement.  The Register  shall be available for inspection by the Company,
any other  Borrower or any Lender at any  reasonable  time and from time to
time upon reasonable prior notice.

          (e) Each Lender may sell  participations  to one or more banks or
other entities  (other than the Company or any of its  Affiliates) in or to
all or a  portion  of its  rights  and  obligations  under  this  Agreement
(including,  without  limitation,  all or a portion of its Commitment,  the
Advances owing to it and any Note or Notes held by it); provided,  however,
that (i) such Lender's obligations under this Agreement (including, without
limitation,   its  Commitment  to  the  Company  and  the  other  Borrowers
hereunder)  shall remain  unchanged,  (ii) such Lender shall remain  solely
responsible  to the  other  parties  hereto  for  the  performance  of such
obligations, (iii) such Lender shall remain the holder of any such Note for
all purposes of this Agreement,  (iv) the Company, any other Borrower,  the
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,  (v) no participant under any such participation shall have
any right to  approve  any  amendment  or waiver of any  provision  of this
Agreement  or any Note,  or any consent to any  departure  by any  Borrower
therefrom,  except to the  extent  that such  amendment,  waiver or consent
would  reduce the  principal  of, or interest  on, the Notes or any fees or
other amounts payable hereunder, in each case to the extent subject to such
participation,  or postpone any date fixed for any payment of principal of,
or interest on, the Notes or any fees or other amounts  payable  hereunder,
in each case to the extent subject to such participation and (vi) within 30
days of the effective date of such participation, such Lender shall provide
notice of such participation to the Company.

          (f)  Any  Lender  may,  in  connection  with  any  assignment  or
participation  or proposed  assignment  or  participation  pursuant to this
Section 9.07,  disclose to the assignee or participant or proposed assignee
or  participant,  any  information  relating to the Company or any Borrower
furnished to such Lender by or on behalf of such  Borrower;  provided that,
prior to any such  disclosure,  the  assignee  or  participant  or proposed
assignee or participant shall agree to preserve the  confidentiality of any
confidential information relating to such Borrower received by it from such
Lender.

          (g)  Notwithstanding  any  other  provision  set  forth  in  this
Agreement,  any Lender may at any time create a security interest in all or
any  portion  of  its  rights  under  this  Agreement  (including,  without
limitation,  the Advances  owing to it and any Note or Notes held by it) in
favor of any Federal  Reserve Bank in accordance  with  Regulation A of the
Board of Governors of the Federal Reserve System.

          SECTION  9.08.  Designated  Subsidiaries.  (a)  Designation.  The
Company may at any time, and from time to time, by delivery to the Agent of
a  Designation  Letter duly  executed  by the  Company  and the  respective
Subsidiary  and  substantially  in the form of Exhibit E hereto,  designate
such Subsidiary as a "Designated Subsidiary" for purposes of this Agreement
and such Subsidiary  shall thereupon  become a "Designated  Subsidiary" for
purposes of this Agreement  and, as such,  shall have all of the rights and
obligations of a Borrower  hereunder.  The Agent shall promptly notify each
Lender of each such  designation  by the  Company  and the  identity of the
respective Subsidiary.

          (b) Termination.  Upon the payment and performance in full of all
of the  indebtedness,  liabilities and obligations under this Agreement and
the  Notes of any  Designated  Subsidiary  then,  so long as at the time no
Notice of Revolving Credit Borrowing or Notice of Competitive Bid Borrowing
in respect of such Designated Subsidiary is outstanding,  such Subsidiary's
status as a "Designated  Subsidiary"  shall  terminate  upon notice to such
effect  from the Agent to the  Lenders  (which  notice the Agent shall give
promptly  upon  its  receipt  of a  request  therefor  from  the  Company).
Thereafter,  the Lenders  shall be under no further  obligation to make any
Advance hereunder to such Designated Subsidiary.

          SECTION 9.09. Confidentiality.  Each of the Lenders and the Agent
hereby  agrees  that it  will  use  reasonable  efforts  (e.g.,  procedures
substantially  comparable  to those  applied by such Lender or the Agent in
respect of non-public  information as to the business of such Lender or the
Agent) to keep  confidential  any financial  reports and other  information
from time to time  supplied  to it by the Company  hereunder  to the extent
that such  information  is not and does not become  publicly  available and
which the Company  indicates  at the time is to be treated  confidentially,
provided,  however,  that nothing herein shall affect the disclosure of any
such  information  (i) by the  Agent  to any  Lender,  (ii)  to the  extent
required by law (including statute,  rule, regulation or judicial process),
(iii) to  counsel  for any  Lender  or the  Agent  or to  their  respective
independent  public  accountants,  (iv) to bank  examiners and auditors and
appropriate government examining authorities, (v) to the Agent or any other
Lender,  (vi) in connection  with any litigation to which any Lender or the
Agent is a party, (vii) to actual or prospective assignees and participants
as  contemplated by Section 9.07(f) or (viii) to any Affiliate of the Agent
or any Lender or to such Affiliate's officers, directors, employees, agents
and advisors,  provided that, prior to any such disclosure,  such Affiliate
or such Affiliate's officers, directors,  employees, agents or advisors, as
the case  may be,  shall  agree  to  preserve  the  confidentiality  of any
confidential  information  relating  to  the  Company  received  by  it;  a
determination  by a  Lender  or  the  Agent  as to the  application  of the
circumstances   described  in  the  foregoing   clauses   (i)-(viii)  being
conclusive  if made in good  faith;  and each of the  Lenders and the Agent
agrees  that  it will  follow  procedures  which  are  intended  to put any
transferee of such confidential information on notice that such information
is confidential.

          SECTION 9.10. Mitigation of Yield Protection.  Each Lender hereby
agrees that,  commencing as promptly as practicable  after it becomes aware
of the  occurrence  of any event  giving rise to the  operation  of Section
2.10(a),  2.11 or 2.13 with respect to such  Lender,  such Lender will give
notice thereof through the Agent to the respective Borrower. A Borrower may
at any time, by notice  through the Agent to any Lender,  request that such
Lender change its  Applicable  Lending  Office as to any Advance or Type of
Advance or that it specify a new Applicable  Lending Office with respect to
its  Commitment  and any  Advance  held by it or that it  rebook  any  such
Advance  with a view to  avoiding  or  mitigating  the  consequences  of an
occurrence  such as described in the  preceding  sentence,  and such Lender
will use  reasonable  efforts to comply with such  request  unless,  in the
opinion of such  Lender,  such  change or  specification  or  rebooking  is
inadvisable or might have an adverse  effect,  economic or otherwise,  upon
it, including its reputation.  In addition, each Lender agrees that, except
for changes or  specifications  or  rebookings  required by law or effected
pursuant to the preceding  sentence,  if the result of any change or change
of specification  of Applicable  Lending Office or rebooking would, but for
this  sentence,  be to impose  additional  costs or  requirements  upon the
respective  Borrower  pursuant to Section 2.10(a),  Section 2.11 or Section
2.13  (which  would  not  be  imposed  absent  such  change  or  change  of
specification  or rebooking) by reason of legal or regulatory  requirements
in effect at the time  thereof  and of which  such  Lender is aware at such
time,  then  such  costs or  requirements  shall not be  imposed  upon such
Borrower  but shall be borne by such Lender.  All expenses  incurred by any
Bank in  changing  an  Applicable  Lending  Office  or  specifying  another
Applicable  Lending  Office of such  Lender or  rebooking  any  Advance  in
response  to a  request  from a  Borrower  shall be paid by such  Borrower.
Nothing in this Section 9.10 (including, without limitation, any failure by
a Lender to give any  notice  contemplated  in the first  sentence  hereof)
shall limit,  reduce or postpone any obligations of the respective Borrower
under  Section  2.10(a),  Section  2.11  or  Section  2.13,  including  any
obligations  payable  in  respect  of any  period  prior to the date of any
change or specification of a new Applicable Lending Office or any rebooking
of any Advance.

          SECTION 9.11.  Governing  Law. This Agreement and the Notes shall
be governed by, and construed in accordance  with, the laws of the State of
New York.

          SECTION 9.12.  Execution in  Counterparts.  This Agreement may be
executed in any number of counterparts  and by different  parties hereto in
separate counterparts, each of which when so executed shall be deemed to be
an original and all of which taken  together  shall  constitute one and the
same agreement.  Delivery of an executed counterpart of a signature page to
this  Agreement by telecopier  shall be effective as delivery of a manually
executed counterpart of this Agreement.

          SECTION 9.13.  Jurisdiction,  Etc. (a) Each of the parties hereto
hereby  irrevocably  and  unconditionally   submits,  for  itself  and  its
property,  to the nonexclusive  jurisdiction of any New York State court or
federal court of the United States of America sitting in New York City, and
any appellate court from any thereof,  in any action or proceeding  arising
out of or relating to this  Agreement or the Notes,  or for  recognition or
enforcement  of any  judgment,  and  each  of  the  parties  hereto  hereby
irrevocably  and  unconditionally  agrees that all claims in respect of any
such action or proceeding  may be heard and determined in any such New York
State court or, to the extent permitted by law, in such federal court. Each
Designated  Subsidiary  hereby  agrees that  service of process in any such
action or  proceeding  brought in the any such New York  State  court or in
such federal court may be made upon CT Corporation System at its offices at
1633  Broadway,  New York,  New York 10019 (the  "Process  Agent") and each
Designated  Subsidiary  hereby  irrevocably  appoints the Process Agent its
authorized  agent to accept such  service of  process,  and agrees that the
failure of the Process  Agent to give any notice of any such service  shall
not  impair or affect  the  validity  of such  service  or of any  judgment
rendered in any action or proceeding  based thereon.  Each Borrower  hereby
further  irrevocably  consents  to the  service of process in any action or
proceeding in such courts by the mailing  thereof by any parties  hereto by
registered  or certified  mail,  postage  prepaid,  to such Borrower at its
address  specified  pursuant to Section  9.02.  Each of the parties  hereto
agrees  that a final  judgment in any such  action or  proceeding  shall be
conclusive  and  may be  enforced  in  other  jurisdictions  by suit on the
judgment or in any other manner provided by law.  Nothing in this Agreement
shall  affect any right that any party may  otherwise  have to serve  legal
process  in any other  manner  permitted  by law or to bring any  action or
proceeding  relating  to this  Agreement  or the Notes in the courts of any
jurisdiction.  To  the  extent  that  each  Designated  Subsidiary  has  or
hereafter may acquire any immunity from  jurisdiction  of any court or from
any legal process (whether  through service or notice,  attachment prior to
judgment,  attachment  in aid of execution,  execution or  otherwise)  with
respect  to itself  or its  property,  each  Designated  Subsidiary  hereby
irrevocably  waives such immunity in respect of its obligations  under this
Agreement.

          (b) Each of the parties hereto  irrevocably  and  unconditionally
waives,  to the fullest  extent it may legally and  effectively  do so, any
objection  that it may now or hereafter  have to the laying of venue of any
suit, action or proceeding  arising out of or relating to this Agreement or
the  Notes in any New York  State or  federal  court.  Each of the  parties
hereto hereby  irrevocably  waives, to the fullest extent permitted by law,
the defense of an  inconvenient  forum to the maintenance of such action or
proceeding in any such court.

          SECTION  9.14.  Substitution  of  Currency.  If a  change  in any
Foreign  Currency occurs pursuant to any applicable law, rule or regulation
of any governmental,  monetary or multi-national  authority, this Agreement
(including,  without  limitation,  the definitions of Eurocurrency Rate and
LIBO Rate) will be amended to the extent  determined  by the Agent  (acting
reasonably and in consultation with the Company) to be necessary to reflect
the change in currency and to put the Lenders and the Borrowers in the same
position, so far as possible,  that they would have been in if no change in
such Foreign Currency had occurred.

          SECTION 9.15. Final Agreement.  This written agreement represents
the full and final  agreement  between  the  parties  with  respect  to the
matters addressed herein and supercedes all prior  communications,  written
or oral, with respect thereto.  There are no unwritten  agreements  between
the parties.

          SECTION  9.16.  Judgment.  (a) If for the  purposes of  obtaining
judgment in any court it is  necessary  to convert a sum due  hereunder  or
under the Notes in any  currency  (the  "Original  Currency")  into another
currency (the "Other  Currency"),  the parties hereto agree, to the fullest
extent that they may  effectively  do so,  that the rate of  exchange  used
shall be that at which in accordance  with normal  banking  procedures  the
Agent could purchase the Original  Currency with the Other Currency at 9:00
A.M. (New York City time) on the first Business Day preceding that on which
final judgment is given.

          (b) The  obligation of each Borrower in respect of any sum due in
the Original Currency from it to any Lender or the Agent hereunder or under
the  Revolving  Credit Note or  Revolving  Credit Notes held by such Lender
shall,  notwithstanding  any judgment in any Other Currency,  be discharged
only to the  extent  that on the  Business  Day  following  receipt by such
Lender or the Agent (as the case may be) of any sum  adjudged  to be so due
in such Other  Currency,  such Lender or the Agent (as the case may be) may
in accordance  with normal banking  procedures  purchase  Dollars with such
Other Currency;  if the amount of Dollars so purchased is less than the sum
originally  due to such  Lender  or the  Agent  (as the case may be) in the
Original  Currency,  such Borrower  agrees,  as a separate  obligation  and
notwithstanding  any such  judgment,  to indemnify such Lender or the Agent
(as the case may be)  against  such  loss,  and if the amount of Dollars so
purchased exceeds the sum originally due to any Lender or the Agent (as the
case may be) in the  Original  Currency,  such  Lender or the Agent (as the
case may be) agrees to remit to such Borrower such excess.

          SECTION 9.17. Waiver of Jury Trial. Each Borrower,  the Agent and
each  Lender  hereby  irrevocably  waive  all right to trial by jury in any
action,  proceeding or  counterclaim  (whether  based on contract,  tort or
otherwise) arising out of or relating to this Agreement or the Notes or the
actions  of the  Agent or any  Lender in the  negotiation,  administration,
performance or enforcement thereof.

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

                                         ALLIEDSIGNAL INC.

                                         By: /s/ Richard F. Wallman
                                            -------------------------------
                                            Name: Richard F. Wallman
                                            Title: Senior Vice President
                                                   and Chief Financial
                                                   Officer

                                         CITIBANK, N.A.,
                                            as Agent

                                         By: /s/ Carolyn A. Kee
                                            -------------------------------
                                            Name: Carolyn A. Kee 
                                            Title: Attorney-in-Fact

COMMITMENT:                              THE LENDERS:
- ----------                               -----------

$140,000,000                               BANK OF AMERICA
                                           NATIONAL TRUST AND
                                           SAVINGS ASSOCIATION

                                         By:/s/ W.L. Hess
                                            -------------------------------
                                            Name:  W.L. Hess
                                            Title: Managing Director

$140,000,000                             BANQUE NATIONALE DE PARIS

                                         By:/s/ Robert S. Taylor, Jr.
                                            -------------------------------
                                            Name:  Robert S. Taylor, Jr.
                                            Title: Senior Vice President

                                         By:/s/ Richard L. Sted
                                            -------------------------------
                                            Name:  Richard L. Sted
                                            Title: Senior Vice President

$140,000,000                             BARCLAYS BANK PLC

                                         By:/s/ Keith Mackie
                                            -------------------------------
                                            Name:   Keith Mackie
                                            Title:  Director

$200,000,000                             CITIBANK, N.A.

                                         By:/s/ Carolyn A. Kee
                                            -------------------------------
                                            Name:  Carolyn A. Kee
                                            Title: Attorney-in-Fact

$140,000,000                             DEUTSCHE BANK AG
                                          NEW YORK AND/OR
                                          CAYMAN ISLANDS BRANCHES

                                         By:/s/ Jean M. Hannigan
                                            -------------------------------
                                            Name:  Jean M. Hannigan
                                            Title: Vice President

                                         By:/s/ Susan L. Pearson
                                            -------------------------------
                                            Name:  Susan L. Pearson
                                            Title: Vice President

$140,000,000                             MORGAN GUARANTY TRUST
                                            COMPANY OF NEW YORK

                                         By:/s/ Christopher C. Kunhardt
                                            -------------------------------
                                            Name:   Christopher C. Kunhardt
                                            Title:  Vice President

$900,000,000                                       TOTAL OF COMMITMENTS

                                                                Eurocurrency
Name of Initial Lender        Domestic Lending                  Lending Office
- ------------------------------------------------------------------------------

SCHEDULE I
                         APPLICABLE LENDING OFFICES

                                                                Eurocurrency
Name of Initial Lender        Domestic Lending                  Lending Office
- ------------------------------------------------------------------------------
                                                         
BANK OF AMERICA               Bank of America National         Bank of America National
  NATIONAL TRUST AND          Trust and Savings Association    Trust and Savings Association
  SAVINGS ASSOCIATION         1850 Gateway Boulevard           1850 Gateway Boulevard
                              Concord, CA  94520               Concord, CA  94520
                              Attn:  Liz Taylor                Attn:  Liz Taylor
                              Phone:  (510) 675-8243           Phone:  (510) 675-8243
                              Fax:  (510) 675-7531             Fax:  (212) 675-7531

BANQUE NATIONALE DE           Banque Nationale de Paris        Banque Nationale de Paris
  PARIS                       499 Park Avenue                  499 Park Avenue
                              New York, NY  10022              New York, NY  10022
                              Attn:  Robert S. Taylor          Attn:  Robert S. Taylor
                              Phone:  (212) 415-9713           Phone:  (212) 415-9713
                              Fax:  (212) 415-9606             Fax:  (212) 415-9606
BARCLAYS BANK PLC

CITIBANK, N.A.                Citibank, N.A.                   Citibank, N.A.
                              399 Park Avenue                  399 Park Avenue
                              New York, NY  10043              New York, NY  10043
                              Attn:  Michael Mandracchia       Attn:  Michael Mandracchia
                              Phone:  (212) 559-3245           Phone:  (212) 559-3245
                              Fax:  (212) 826-2371             Fax:  (212) 826-2371

DEUTSCHE BANK AG              Deutsche Bank AG                 Deutsche Bank AG
   NEW YORK AND/OR            New York Branch                  Cayman Islands Branch
   CAYMAN ISLANDS             31 West 52nd Street              31 West 52nd Street
   BRANCHES                   New York, NY  10019              New York, NY  10019
                              Attn:  Colin T. Taylor           Attn:  Colin T. Taylor
                              Phone:  (212) 474-7904           Phone:  (212) 474-7904
                              Fax:  (212) 474-8212             Fax:  (212) 474-8212

MORGAN GUARANTY               Morgan Guaranty Trust            Morgan Guaranty Trust
   TRUST COMPANY OF           Company of New York              Company of New York
   NEW YORK                   60 Wall Street                   60 Wall Street
                              New York, NY  10260-0060         New York, NY  10260-0060
                              Attn:  Credit Administration     Attn:  Credit Administration
                              Phone:  (212) 648-6974           Phone:  (212) 648-6974
                              Fax:  (212) 648-5021             Fax:  (212) 648-5021

                              SCHEDULE 3.01(b)

                            DISCLOSED LITIGATION
                            --------------------

                                    None

                           EXHIBIT A-1 - FORM OF
                              REVOLVING CREDIT
                              PROMISSORY NOTE

                                               Dated:  _______________, 199_

          FOR VALUE RECEIVED, the undersigned, [NAME OF BORROWER], a
_________________________ corporation (the "Borrower"), HEREBY PROMISES TO
PAY to the order of _________________________ (the "Lender") for the
account of its Applicable Lending Office on the later of the Termination
Date (each as defined in the Credit Agreement referred to below) and the
date designated pursuant to Section 2.06 of the Credit Agreement the
aggregate principal amount of the Revolving Credit Advances made by the
Lender to the Borrower pursuant to the 364-Day Backstop Credit Agreement
dated as of October 9, 1998 among AlliedSignal Inc., the Lender and certain
other lenders parties thereto, and Citibank, N.A., as Agent for the Lender
and such other lenders (as amended or modified from time to time, the
"Credit Agreement"; the terms defined therein being used herein as therein
defined) outstanding on such date.

          The Borrower promises to pay interest on the unpaid principal
amount of each Revolving Credit Advance from the date of such Revolving
Credit Advance until such principal amount is paid in full, at such
interest rates, and payable at such times, as are specified in the Credit
Agreement.

          Both principal and interest in respect of each Revolving Credit
Advance (i) in Dollars are payable in lawful money of the United States of
America to Citibank, N.A., as Agent, at 399 Park Avenue, New York, New
York 10043, in same day funds and (ii) in any Major Currency are payable
in such currency at the applicable Payment Office in same day funds. Each
Revolving Credit Advance owing to the Lender by the Borrower pursuant to
the Credit Agreement, and all payments made on account of principal
thereof, shall be recorded by the Lender and, prior to any transfer hereof,
endorsed on the grid attached hereto which is part of this Promissory Note.

          This Promissory Note is one of the Revolving Credit Notes
referred to in, and is entitled to the benefits of, the Credit Agreement.
The Credit Agreement, among other things, (i) provides for the making of
Revolving Credit Advances by the Lender to the Borrower from time to time
in an aggregate amount not to exceed at any time outstanding the Dollar
amount first above mentioned or the Equivalent thereof in one or more Major
Currencies, the indebtedness of the Borrower resulting from each such
Revolving Credit Advance being evidenced by this Promissory Note, (ii)
contains provisions for determining the Dollar Equivalent of Revolving
Credit Advances denominated in Major Currencies and (iii) contains
provisions for acceleration of the maturity hereof upon the happening of
certain stated events and also for prepayments on account of principal
hereof prior to the maturity hereof upon the terms and conditions therein
specified.

          The Borrower hereby waives presentment, demand, protest and
notice of any kind. No failure to exercise, and no delay in exercising, any
rights hereunder on the part of the holder hereof shall operate as a waiver
of such rights.

          This promissory note shall be governed by, and construed in
accordance with the laws of the State of New York.

                                              [NAME OF BORROWER]

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

                     ADVANCES AND PAYMENTS OF PRINCIPAL

========================================================================================================
  Date        Type of            Amount of         Interest
              Advance           Advance in           Rate       Amount of
                             Relevant Currency                  Principal       Unpaid        Notation
                                                                   Paid        Principal      Made By
                                                                or Prepaid      Balance
- --------------------------------------------------------------------------------------------------------

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========================================================================================================

                           EXHIBIT A-2 - FORM OF
                              COMPETITIVE BID
                              PROMISSORY NOTE

                                              Dated:  _______________, 199_

          FOR VALUE RECEIVED, the undersigned, [NAME OF BORROWER], a
_________________________ corporation (the "Borrower"), HEREBY PROMISES TO
PAY to the order of _________________________ (the "Lender") for the
account of its Applicable Lending Office (as defined in the 364-Day
Backstop Credit Agreement dated as of October 9, 1998 among AlliedSignal
Inc., the Lender and certain other lenders parties thereto, and Citibank,
N.A., as Agent for the Lender and such other lenders (as amended or
modified from time to time, the "Credit Agreement"; the terms defined
therein being used herein as therein defined)), on _______________, the
principal amount of [U.S.$_______________] [for a Competitive Bid Advance
in a Foreign Currency, list currency and amount of such Advance].

          The Borrower promises to pay interest on the unpaid principal
amount hereof from the date hereof until such principal amount is paid in
full, at the interest rate and payable on the interest payment date or
dates provided below:

          Interest Rate: [____% per annum (calculated on the basis of a
year of _____ days for the actual number of days elapsed)].

          Interest Payment Date or Dates: ______________

          Both principal and interest are payable in lawful money of
___________________ to Citibank, N.A., as Agent, for the account of the
Lender at the office of _________________________, at
_________________________ in same day funds.

          This Promissory Note is one of the Competitive Bid Notes referred
to in, and is entitled to the benefits of, the Credit Agreement. The Credit
Agreement, among other things, contains provisions for acceleration of the
maturity hereof upon the happening of certain stated events.

          The Borrower hereby waives presentment, demand, protest and
notice of any kind. No failure to exercise, and no delay in exercising, any
rights hereunder on the part of the holder hereof shall operate as a waiver
of such rights.

          This Promissory Note shall be governed by, and construed in
accordance with, the laws of the State of New York.

                                                   [NAME OF BORROWER]

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

                      EXHIBIT B-1 - FORM OF NOTICE OF
                         REVOLVING CREDIT BORROWING

Citibank, N.A., as Agent
  for the Lenders parties
  to the Credit Agreement
  referred to below
  Two Penns Way
  New Castle, Delaware  19720                                           [Date]

          Attention:  Bank Loan Syndication

Ladies and Gentlemen:

          The undersigned, [Name of Borrower], refers to the 364-Day
Backstop Credit Agreement, dated as of October 9, 1998 (as amended or
modified from time to time, the "Credit Agreement", the terms defined
therein being used herein as therein defined), among the undersigned,
certain Lenders parties thereto, and Citibank, N.A., as Agent for said
Lenders, and hereby gives you notice, irrevocably, pursuant to Section 2.02
of the Credit Agreement that the undersigned hereby requests a Revolving
Credit Borrowing under the Credit Agreement, and in that connection sets
forth below the information relating to such Revolving Credit Borrowing
(the "Proposed Revolving Credit Borrowing") as required by Section 2.02(a)
of the Credit Agreement:

          (i) The Business Day of the Proposed Revolving Credit Borrowing
     is _______________.

          (ii) The Type of Advances comprising the Proposed Revolving
     Credit Borrowing is [Base Rate Advances] [Eurocurrency Rate Advances].

          (iii) The aggregate amount of the Proposed Revolving Credit
     Borrowing is [$_______________] [for a Revolving Credit Borrowing in a
     Major Currency, list currency and amount of Revolving Credit
     Borrowing].

          [(iv) The initial Interest Period for each Eurocurrency Rate
     Advance made as part of the Proposed Revolving Credit Borrowing is
     _____ month[s].]

          The undersigned hereby certifies that the conditions precedent to
this Revolving Credit Borrowing set forth in Section 3.03 of the Credit
Agreement have been satisfied and the applicable statements contained
therein are true on the date hereof, and will be true on the date of the
Proposed Revolving Credit Borrowing.

                                              Very truly yours,

                                              [NAME OF BORROWER]

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

                      EXHIBIT B-2 - FORM OF NOTICE OF
                         COMPETITIVE BID BORROWING

Citibank, N.A., as Agent
  for the Lenders parties
  to the Credit Agreement
  referred to below
  Two Penns Way
  New Castle, Delaware  19720                                           [Date]

Attention:  Bank Loan Syndication

Ladies and Gentlemen:

          The undersigned, [Name of Borrower], refers to the 364-Day
Backstop Credit Agreement, dated as of October 9, 1998 (as amended or
modified from time to time, the "Credit Agreement", the terms defined
therein being used herein as therein defined), among AlliedSignal Inc.,
certain Lenders parties thereto and Citibank, N.A., as Agent for said
Lenders, and hereby gives you notice, irrevocably, pursuant to Section 2.03
of the Credit Agreement that the undersigned hereby requests a Competitive
Bid Borrowing under the Credit Agreement, and in that connection sets forth
the terms on which such Competitive Bid Borrowing (the "Proposed
Competitive Bid Borrowing") is requested to be made:

          (A)    Date of Competitive Bid Borrowing                        
          __________________
          (B)    Aggregate Amount of Competitive Bid Borrowing            
          __________________
          (C)    [Maturity Date] [Interest Period]                        
          __________________
          (D)    Interest Rate Basis                                      
          __________________
          (E)    Day Count Convention                        
          __________________
          (F)    Interest Payment Date(s)                                 
          __________________
          (G)    [Currency]                                               
          __________________
          (H)    Borrower's Account Location                 
          __________________
          (I)    ___________________                          
          __________________

          The undersigned hereby certifies that the conditions precedent to
this Competitive Bid Borrowing set forth in Section 3.04 of the Credit
Agreement have been satisfied and the applicable statements contained
therein are true on the date hereof, and will be true on the date of the
Proposed Competitive Bid Borrowing.

          The undersigned hereby confirms that the Proposed Competitive Bid
Borrowing is to be made available to it in accordance with Section
2.03(a)(v) of the Credit Agreement.

                                              Very truly yours,

                                              [NAME OF BORROWER]

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

                            EXHIBIT C - FORM OF
                         ASSIGNMENT AND ACCEPTANCE

                                                    Dated: _____________

          Reference is made to the 364-Day Backstop Credit Agreement dated
as of October 9, 1998 (as amended or modified from time to time, the
"Credit Agreement") among AlliedSignal Inc., a Delaware corporation (the
"Borrower"), the Lenders (as defined in the Five-Year Credit Agreement),
and Citibank, N.A., as agent (the "Agent") for the Lenders. Terms defined
in the Credit Agreement are used herein with the same meaning.

          ____________ (the "Assignor") and ____________ (the "Assignee")
agree as follows:

          1. The Assignor hereby sells and assigns to the Assignee, and the
Assignee hereby purchases and assumes from the Assignor, an interest in and
to the Assignor's rights and obligations under the Credit Agreement as of
the date hereof (other than in respect of Competitive Bid Advances and
Competitive Bid Notes) equal to the percentage interest specified on
Schedule 1 hereto of all outstanding rights and obligations under the
Credit Agreement (other than in respect of Competitive Bid Advances and
Competitive Bid Notes). After giving effect to such sale and assignment,
the Assignee's Commitment and the amount of the Revolving Credit Advances
in each relevant currency owing to the Assignee will be as set forth on
Schedule 1 hereto.

          2. The Assignor (i) represents and warrants that it is the legal
and beneficial owner of the interest being assigned by it hereunder and
that such interest is free and clear of any adverse claim; (ii) makes no
representation or warranty and assumes no responsibility with respect to
any statements, warranties or representations made in or in connection with
the Credit Agreement or any other instrument or document furnished pursuant
thereto or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of the Credit Agreement or any other instrument or
document furnished pursuant thereto; (iii) makes no representation or
warranty and assumes no responsibility with respect to the financial
condition of any Borrower or the performance or observance by such Borrower
of any of its obligations under the Credit Agreement or any other
instrument or document furnished pursuant thereto; [and (iv) attaches the
Revolving Credit Note held by the Assignor and requests that the Agent
obtain from the Borrower a new Revolving Credit Note payable to the order
of the Assignee with respect to the aggregate principal amount of the
Revolving Credit Advances assumed by such Assignee pursuant hereto,
substantially in the form of Exhibit A-1 to the Credit Agreement].

          3. The Assignee (i) confirms that it has received a copy of the
Credit Agreement, together with copies of the financial statements referred
to in Section 4.01(e) thereof 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 Acceptance; (ii) agrees that it will,
independently and without reliance upon the 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 Credit Agreement; (iii) confirms that
it is an Eligible Assignee; (iv) appoints and authorizes the 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 Agent by the
terms thereof, together with such powers and discretion as are reasonably
incidental thereto; (v) agrees that it will perform in accordance with
their terms all of the obligations that by the terms of the Credit
Agreement are required to be performed by it as a Lender; and (vi) attaches
any U.S. Internal Revenue Service forms required under Section 2.13 of the
Credit Agreement.

          4. Following the execution of this Assignment and Acceptance, it
will be delivered to the Agent for acceptance and recording by the Agent.
The effective date for this Assignment and Acceptance (the "Effective
Date") shall be the date of acceptance hereof by the Agent, unless
otherwise specified on Schedule 1 hereto.

          5. Upon such acceptance and recording by the Agent, as of the
Effective Date, (i) the Assignee shall be a party to the Credit Agreement
and, to the extent provided in this Assignment and Acceptance, have the
rights and obligations of a Lender thereunder and (ii) the Assignor shall,
to the extent provided in this Assignment and Acceptance, relinquish its
rights and be released from its obligations under the Credit Agreement,
provided, however, that the Assignor's rights under Sections 2.10, 2.13 and
9.04 of the Credit Agreement, and its obligations under Section 8.05 of the
Credit Agreement, shall survive the assignment pursuant to this Assignment
and Acceptance as to matters occurring prior to the Effective Date.

          6. Upon such acceptance and recording by the Agent, from and
after the Effective Date, the Agent shall make all payments under the
Credit Agreement and the Revolving Credit Notes in respect of the interest
assigned hereby (including, without limitation, all payments of principal,
interest and facility fees with respect thereto) to the Assignee. The
Assignor and Assignee shall make all appropriate adjustments in payments
under the Credit Agreement and any Revolving Credit Notes for periods prior
to the Effective Date directly between themselves.

          7. This Assignment and Acceptance shall be governed by, and
construed in accordance with, the laws of the State of New York.

          8. This Assignment and Acceptance may be executed in any number
of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement. Delivery
of an executed counterpart of Schedule 1 to this Assignment and Acceptance
by telecopier shall be effective as delivery of a manually executed
counterpart of this Assignment and Acceptance.

          IN WITNESS WHEREOF, the Assignor and the Assignee have caused
Schedule 1 to this Assignment and Acceptance to be executed by their
officers thereunto duly authorized as of the date specified thereon.

                                 Schedule 1
                                     to
                         Assignment and Acceptance

                                                     Dated:  ______________
Section 1.
- ---------

     Percentage interest assigned:                                        _____%

     Assignee's Commitment:                                             $______

Section 2.
- ---------

(a)  Assigned Advances
     -----------------

     Aggregate outstanding principal amount of Revolving Credit
     Advances in Dollars assigned:                                      $

     Aggregate outstanding principal amount of Revolving Credit
     Advances in lawful money of the Republic of France assigned:       Fr

     Aggregate outstanding principal amount of Revolving Credit
     Advances in lawful currency of the United Kingdom of Great
     Britain and Northern Ireland assigned:                             (pound)

     Aggregate outstanding principal amount of Revolving Credit
     Advances in lawful currency of the Federal Republic of
     Germany assigned:                                                   DM

     Aggregate outstanding principal amount of Revolving Credit
     Advances in lawful currency of Japan assigned:                      

     Aggregate outstanding principal amount of Revolving Credit
     Advances in lawful currency of the European Economic and
     Monetary Union assigned:

(b)  Retained Advances
     -----------------

     Aggregate outstanding principal amount of Revolving Credit
     Advances in Dollars retained:                                       $

     Aggregate outstanding principal amount of Revolving Credit
     Advances in lawful money of the Republic of France retained:        Fr 

     Aggregate outstanding principal amount of Revolving
     Credit Advances in lawful currency of the United Kingdom of
     Great Britain and Northern Ireland retained:                       (pound)

     Aggregate outstanding principal amount of Revolving Credit
     Advances in lawful currency of the Federal Republic of
     Germany retained:                                                  DM

     Aggregate outstanding principal amount of Revolving Credit
     Advances in lawful currency of Japan retained:                     

     Aggregate outstanding principal amount of Revolving Credit
     Advances in lawful currency of the European Economic and
     Monetary Union retained:

        Effective Date(1):     _______________

                                         [NAME OF ASSIGNOR], as Assignor

                                         By
                                            Title:

                                         Dated:  _______________

                                         [NAME OF ASSIGNEE], as Assignee

                                         By
                                            Title:

                                         Dated:  _______________

                                         Domestic Lending Office:
                                            [Address]

                                         Eurocurrency Lending Office:
                                            [Address]

Consented to this __________ day
of _______________

[NAME OF BORROWER]

By                                  
Name:
Title:

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

1    This date should be no earlier than five Business Days after
     the delivery of this Assignment and Acceptance to the Agent.

                           EXHIBIT D - FORM OF ASSUMPTION AGREEMENT

                                                          Dated:________

AlliedSignal Inc.
P.O. Box 12l9R
101 Columbia Road
Morristown, New Jersey  07960

   Attention:  Treasurer

Citibank, N.A.,
   as Agent
Two Penns Way
New Castle, Delaware  19720

     Attention:  Bank Loan Syndication

Ladies and Gentlemen:

          Reference is made to the 364-Day Backstop Credit Agreement dated
as of October 9, 1998 among AlliedSignal Inc. (the "Company"), the Lenders
parties thereto, and Citibank, N.A. as Agent (the "Credit Agreement"; terms
defined therein being used herein as therein defined), for such Lenders.

          The undersigned ("Assuming Lender") proposes to become an
Assuming Lender pursuant to Section 2.16 of the Credit Agreement and, in
that connection, hereby agrees that it shall become a Lender for purposes
of the Credit Agreement on [applicable Extension Date], assuming on such
date the Commitment (without giving effect to assignments thereof which
have not yet become effective and without regard to any Competitive Bid
Commitment Reduction) as in effect on [applicable Extension Date] of [name
of applicable Non-Consenting Lender] (the "Assignor") in the amount of
$____________ and the Advances (without giving effect to assignments
thereof which have not yet become effective) owing to the Assignor on
[applicable Extension Date] in the amount of [indicate amounts and
currencies of various assigned Advances].

          The Assignor (i) represents and warrants that as of the date
hereof its Commitment (without giving effect to assignments thereof which
have not yet become effective and without regard to any Competitive Bid
Commitment Reduction) is $______ and the outstanding principal amount of
Advances owing to it (without giving effect to assignments thereof which
have not yet become effective) (A) in Dollars is $______, (B) in lawful
currency of Japan is ____, (C) in lawful currency of the Federal Republic
of Germany is DM____, (D) in lawful currency of the Republic of France is
Fr_____, (E) in lawful currency of the United Kingdom of Great Britain and
Northern Ireland is (pound)____[, and (F) indicate amounts of Advances in
other Foreign Currencies, if any]; (ii) represents and warrants that it is
the legal and beneficial owner of the interest being assigned by it
hereunder and that such interest is free and clear of any adverse claim;
(iii) makes no representation or warranty and assumes no responsibility
with respect to any statements, warranties or representations made in or in
connection with the Credit Agreement or any other instrument or document
furnished pursuant thereto or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Credit Agreement
or any other instrument or document furnished pursuant thereto; and (iv)
makes no representation or warranty and assumes no responsibility with
respect to the financial condition of the Company or any other Borrower or
the performance or observance by the Company or any other Borrower of any
of its obligations under the Credit Agreement or any other instrument or
document furnished pursuant thereto.

          The Assuming Lender (i) confirms that it has received a copy of
the Credit Agreement, together with copies of the financial statements
referred to in Section 4.01(e) thereof, the most recent financial
statements referred to in Section 5.01(h) thereof and such other documents
and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assumption Agreement; (ii) agrees
that it will, independently and without reliance upon the 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 Credit Agreement; (iii)
appoints and authorizes the Agent to take such action as agent on its
behalf and to exercise such powers under the Credit Agreement as are
delegated to the Agent by the terms thereof, together with such powers as
are reasonably incidental thereto; (iv) agrees that it will perform in
accordance with their terms all of the obligations which by the terms of
the Credit Agreement are required to be performed by it as a Lender; (v)
specifies as its Lending Office (and address for notices) the offices set
forth beneath its name on the signature pages hereof; and (vi) attaches the
forms prescribed by the Internal Revenue Service of the United States
required under Section 2.13 of Credit Agreement.

          The Assuming Lender requests that the Company deliver to the
Agent (to be promptly delivered to the Assuming Lender) Revolving Credit
Notes payable to the order of the Assuming Lender, dated as of the
Extension Date and substantially in the form of Exhibit A-1 to the Credit
Agreement.

          The effective date for this Assumption Agreement shall be
[applicable Extension Date]. Upon delivery of this Assumption Agreement to
the Company and the Agent, and satisfaction of all conditions imposed under
Section 2.16 as of [date specified above], the undersigned shall be a party
to the Credit Agreement and have the rights and obligations of a Lender
thereunder and the Assignor shall relinquish its rights and be released
from its obligations under the Credit Agreement. As of [date specified
above], the Agent shall make all payments under the Credit Agreement in
respect of the interest assigned hereby (including, without limitation, all
payments of principal, interest and commitment fees) to the Assuming
Lender.

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

          This Assumption Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York.

                                             Very truly yours,

                                             [NAME OF ASSUMING LENDER]

                                             By________________________
                                                 Name:
                                                 Title:

                                             Domestic Lending Office
                                             (and address for notices):

                                             [Address]

                                             Eurodollar Lending Office

                                             [NAME OF ASSIGNOR]2

                                             By________________________
                                                 Name:
                                                 Title:

                                                 [Address]

Above Acknowledged and Agreed to:

ALLIEDSIGNAL INC.

By______________________
    Name:
    Title:

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

2       Use only in connection with Section 2.16.

                   EXHIBIT E - FORM OF DESIGNATION LETTER

                                                          [DATE]

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

Ladies and Gentlemen:

          Reference is made to the 364-Day Backstop Credit Agreement dated
as of October 9, 1998 among AlliedSignal Inc. (the "Company"), the Lenders
named therein, and Citibank, N.A., as Agent for said Lenders (the "Credit
Agreement"). For convenience of reference, terms used herein and defined in
the Credit Agreement shall have the respective meanings ascribed to such
terms in the Credit Agreement.

          Please be advised that the Company hereby designates its
undersigned Subsidiary, ____________ ("Designated Subsidiary"), as a
"Designated Subsidiary" under and for all purposes of the Credit Agreement.

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

          1. The Designated Subsidiary is a corporation duly incorporated,
     validly existing and in good standing under the laws of
     __________________ and is duly qualified to transact business in all
     jurisdictions in which such qualification is required.

          2. The execution, delivery and performance by the Designated
     Subsidiary of this Designation Letter, the Credit Agreement, its Notes
     and the consummation of the transactions contemplated thereby, are
     within the Designated Subsidiary's corporate powers, have been duly
     authorized by all necessary corporate action, and do not and will not
     cause or constitute a violation of any provision of law or regulation
     or any provision of the charter or by-laws of the Designated
     Subsidiary or result in the breach of, or constitute a default or
     require any consent under, or result in the creation of any lien,
     charge or encumbrance upon any of the properties, revenues, or assets
     of the Designated Subsidiary pursuant to, any indenture or other
     agreement or instrument to which the Designated Subsidiary is a party
     or by which the Designated Subsidiary or its property may be bound or
     affected.

          3. This Designation Agreement and each of the Notes of the
     Designated Subsidiary, when delivered, will have been duly executed
     and delivered, and this Designation Letter, the Credit Agreement and
     each of the Notes of the Designated Subsidiary, when delivered, will
     constitute a legal, valid and binding obligation of the Designated
     Subsidiary enforceable against the Designated Subsidiary in accordance
     with their respective terms except to the extent that such enforcement
     may be limited by applicable bankruptcy, insolvency and other similar
     laws affecting creditors' rights generally.

          4. There is no action, suit, investigation, litigation or
     proceeding including, without limitation, any Environmental Action,
     pending or to the knowledge of the Designated Subsidiary Threatened
     affecting the Designated Subsidiary before any court, governmental
     agency or arbitration that (i) is reasonably likely to have a Material
     Adverse Effect, or (ii) purports to effect the legality, validity or
     enforceability of this Designation Letter, the Credit Agreement, any
     Note of the Designated Subsidiary or the consummation of the
     transactions contemplated thereby.

          5. No authorizations, consents, approvals, licenses, filings or
     registrations by or with any governmental authority or administrative
     body are required in connection with the execution, delivery or
     performance by the Designated Subsidiary of this Designation Letter,
     the Credit Agreement or the Notes of the Designated Subsidiary except
     for such authorizations, consents, approvals, licenses, filings or
     registrations as have heretofore been made, obtained or effected and
     are in full force and effect.

          6. The Designated Subsidiary is not, and immediately after the
     application by the Designated Subsidiary of the proceeds of each
     Advance will not be, (a) an "investment company" within the meaning of
     the Investment Company Act of 1940, as amended, or (b) a "holding
     company" within the meaning of the Public Utility Holding Company Act
     of 1935, as amended.

                                          Very truly yours,

                                          ALLIEDSIGNAL INC.

                                          By _________________________
                                             Name:
                                             Title:

                                          [THE DESIGNATED SUBSIDIARY]

                                          By__________________________
                                             Name:
                                             Title:

EXHIBIT F - FORM OF ACCEPTANCE BY PROCESS AGENT

                                [Letterhead of Process Agent]

                                                              [Date]

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

                      [Name of Designated Subsidiary]
                      -------------------------------

Ladies and Gentlemen:

          Reference is made to (i) that certain 364-Day Backstop Credit
Agreement dated as of October 9, 1998 among AlliedSignal Inc., the Lenders
named therein, and Citibank, N.A., as Agent (such Credit Agreement as it
may hereafter be amended, supplemented or otherwise modified from time to
time, being the "Credit Agreement"; the terms defined therein being used
herein as therein defined), and (ii) to the Designation Letter, dated
_________, pursuant to which __________ has become a Borrower.

          Pursuant to Section 9.13 of the Credit Agreement to which
__________ has become subject pursuant to its Designation Letter,
__________ has appointed the undersigned (with an office on the date hereof
at 1633 Broadway, New York, New York 10019, United States) as Process Agent
to receive on behalf of ______________ and its property service of copies
of the summons and complaint and any other process which may be served in
any action or proceeding in any New York State or Federal court sitting in
New York City arising out of or relating to the Credit Agreement.

          The undersigned hereby accepts such appointment as Process Agent
and agrees with each of you that (i) the undersigned will not terminate or
abandon the undersigned agency as such Process Agent without at least six
months prior notice to the Agent (and hereby acknowledges that the
undersigned has been retained for its services as Process Agent through
October 9, 1999), (ii) the undersigned will maintain an office in New York
City through such date and will give the Agent prompt notice of any change
of address of the undersigned, (iii) the undersigned will perform its
duties as Process Agent to receive on behalf of ______________ and its
property service of copies of the summons and complaint and any other
process which may be served in any action or proceeding in any New York
State or Federal court sitting in New York City arising out of or relating
to the Credit Agreement and (iv) the undersigned will forward forthwith to
______________ at its address at ________________ or, if different, its
then current address, copies of any summons, complaint and other process
which the undersigned receives in connection with its appointment as
Process Agent.

          This acceptance and agreement shall be binding upon the
undersigned and all successors of the undersigned.

                                                   Very truly yours,

                                                   [PROCESS AGENT]

                                                   By_______________________

                        EXHIBIT G - FORM OF OPINION
                            OF J. EDWARD SMITH,
                       SENIOR COUNSEL FOR THE COMPANY

                                                            October 9, 1998

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

                             AlliedSignal Inc.
                             -----------------

Ladies and Gentlemen:

          This opinion is furnished to you pursuant to Section 3.01(e)(vi)
of the 364-Day Backstop Credit Agreement dated as of October 9, 1998 among
AlliedSignal Inc. (the "Company"), the Lenders parties thereto, and
Citibank, N.A., as Agent for said Lenders (the "Credit Agreement"). Terms
defined in the Credit Agreement are, unless otherwise defined herein, used
herein as therein defined.

          I have acted as counsel for the Company in connection with the
preparation, execution and delivery of the Credit Agreement.

          In that connection I have examined:

          (1) The Credit Agreement.

          (2) The documents furnished by the Company pursuant to Article
     III of the Credit Agreement, including the Certificate of
     Incorporation of the Company and all amendments thereto (the
     "Charter") and the By-laws of the Company and all amendments thereto
     (the "By-laws").

          (3) A certificate of the Secretary of State of the State of
     Delaware, dated ____________, 1998, attesting to the continued
     corporate existence and good standing of the Company in that State.

I have also examined the originals, or copies certified to my satisfaction,
of such corporate records of the Company (including resolutions adopted by
the Board of Directors of the Company), certificates of public officials
and of officers of the Company, and agreements, instruments and documents,
as I have deemed necessary as a basis for the opinions hereinafter
expressed. As to questions of fact material to such opinions, I have, when
relevant facts were not independently established by me, relied upon
certificates of the Company or its officers or of public officials. I have
assumed the due execution and delivery, pursuant to due authorization, of
the Credit Agreement by the Initial Lenders and the Agent.

          I am qualified to practice law in the State of New York, and I do
not purport to be expert in, or to express any opinion herein concerning,
any laws other than the laws of the State of New York, the General
Corporation Law of the State of Delaware and the Federal laws of the United
States.

          Based upon the foregoing and upon such investigation as I have
deemed necessary, I am of the following opinion:

          1. The Company (a) is a corporation duly organized, validly
     existing and in good standing under the laws of the State of Delaware,
     (b) is duly qualified as a foreign corporation in each other
     jurisdiction in which it owns or leases property or in which the
     conduct of its business requires it to so qualify or be licensed and
     (c) has all requisite corporate power and authority to own or lease
     and operate its properties and to carry on its business as now
     conducted and as proposed to be conducted.

          2. The execution, delivery and performance by the Company of the
     Credit Agreement and the Notes of the Company, and the consummation of
     the transactions contemplated thereby, are within the Company's
     corporate powers, have been duly authorized by all necessary corporate
     action, and do not (i) contravene the Charter or the By-laws or (ii)
     violate any law (including, without limitation, the Securities
     Exchange Act of 1934 and the Racketeer Influenced and Corrupt
     Organizations Chapter of the Organized Crime Control Act of 1970),
     rule, regulation (including, without limitation, Regulation X of the
     Board of Governors of the Federal Reserve System) or any material
     order, writ, judgment, decree, determination or award or (iii)
     conflict with or result in the breach of, or constitute a default
     under, any material indenture, loan or credit agreement, lease,
     mortgage, security agreement, bond, note or any similar document. The
     Credit Agreement and the Notes of the Company have been duly executed
     and delivered on behalf of the Company.

          3. No authorization, approval, or other action by, and no notice
     to or filing with, any governmental authority, administrative agency
     or regulatory body, or any third party is required for the due
     execution, delivery and performance by the Company of the Credit
     Agreement or the Notes of the Company, or for the consummation of the
     transactions contemplated thereby.

          4. The Credit Agreement is, and each Note of the Company when
     delivered under the Credit Agreement will be, the legal, valid and
     binding obligation of the Company enforceable against the Company in
     accordance with their respective terms, except as the enforceability
     thereof may be limited by bankruptcy, insolvency, reorganization or
     moratorium or other similar laws relating to the enforcement of
     creditors' rights generally or by the application of general
     principles of equity (regardless of whether such enforceability is
     considered in a proceeding in equity or at law), and except that I
     express no opinion as to (i) the subject matter jurisdiction of the
     District Courts of the United States of America to adjudicate any
     controversy relating to the Credit Agreement or the Notes of the
     Company or (ii) the effect of the law of any jurisdiction (other than
     the State of New York) wherein any Lender or Applicable Lending Office
     may be located or wherein enforcement of the Credit Agreement or the
     Notes of the Company may be sought which limits rates of interest
     which may be charged or collected by such Lender.

          5. There is no action, suit, investigation, litigation or
     proceeding against the Company or any of its Subsidiaries before any
     court, governmental agency or arbitrator now pending or, to the best
     of my knowledge, Threatened that is reasonably likely to have a
     Material Adverse Effect (other than the Disclosed Litigation) or that
     purports to affect the legality, validity or enforceability of the
     Credit Agreement or any Note of the Company or the consummation of the
     transactions contemplated thereby, and there has been no adverse
     change in the status, or financial effect on the Company or any of its
     Subsidiaries, of the Disclosed Litigation from that described on
     Schedule 3.01(b) of the Credit Agreement.

          6. The Company is not an "investment company" within the meaning
     of the Investment Company Act of 1940, as amended.

          7. The Company is not a "holding company" within the meaning of
     the Public Utility Holding Company Act of 1935, as amended.

          In connection with the opinions expressed by me above in
paragraph 4, I wish to point out that (i) provisions of the Credit
Agreement that permit the Agent or any Lender to take action or make
determinations may be subject to a requirement that such action be taken or
such determinations be made on a reasonable basis and in good faith, (ii)
that a party to whom an advance is owed may, under certain circumstances,
be called upon to prove the outstanding amount of the Advances evidenced
thereby and (iii) the rights of the Agent and the Lenders provided for in
Section 9.04(b) of the Credit Agreement may be limited in certain
circumstances.

                                                   Very truly yours,

                   EXHIBIT H - FORM OF OPINION OF COUNSEL
                         TO A DESIGNATED SUBSIDIARY

                                                      ____________, 19__

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

Ladies and Gentlemen:

          In my capacity as counsel to _____________________ ("Designated
Subsidiary"), I have reviewed that certain 364-Day Backstop Credit
Agreement dated as of October 9, 1998 among AlliedSignal Inc., the Lenders
named therein, and Citibank, N.A., as Agent for such Lenders (the "Credit
Agreement"). In connection therewith, I have also examined the following
documents:

          (i) The Designation Letter (as defined in the Credit Agreement)
     executed by the Designated Subsidiary.

          [such other documents as counsel may wish to refer to]

          I have also reviewed such matters of law and examined the
original, certified, conformed or photographic copies of such other
documents, records, agreements and certificates as I have considered
relevant hereto.

          Except as expressly specified herein all terms used herein and
defined in the Credit Agreement shall have the respective meanings ascribed
to them in the Credit Agreement.

          Based upon the foregoing, I am of the opinion that:

          1. The Designated Subsidiary (a) is a corporation duly
     incorporated, validly existing and in good standing under the laws of
     _________________________, (b) is duly qualified in each other
     jurisdiction in which it owns or leases property or in which the
     conduct of its business requires it to so qualify or be licensed and
     (c) has all requisite corporate power and authority to own or lease
     and operate its properties and to carry on its business as now
     conducted and as proposed to be conducted.

          2. The execution, delivery and performance by the Designated
     Subsidiary of its Designation Letter, the Credit Agreement and its
     Notes, and the consummation of the transactions contemplated thereby,
     are within the Designated Subsidiary's corporate powers, have been
     duly authorized by all necessary corporate action, and do not and will
     not cause or constitute a violation of any provision of law or
     regulation or any material order, writ, judgment, decree,
     determination or award or any provision of the charter or by-laws or
     other constituent documents of the Designated Subsidiary or result in
     the breach of, or constitute a default or require any consent under,
     or result in the creation of any lien, charge or encumbrance upon any
     of the properties, revenues, or assets of the Designated Subsidiary
     pursuant to, any material indenture or other agreement or instrument
     to which the Designated Subsidiary is a party or by which the
     Designated Subsidiary or its property may be bound or affected. The
     Designation Letter and each Note of the Designated Subsidiary has been
     duly executed and delivered on behalf of the Designated Subsidiary.

          3. The Credit Agreement and the Designation Letter of the
     Designated Subsidiary are, and each Note of the Designated Subsidiary
     when delivered under the Credit Agreement will be, the legal, valid
     and binding obligation of the Designated Subsidiary enforceable in
     accordance with their respective terms, except as the enforceability
     thereof may be limited by bankruptcy, insolvency, reorganization or
     moratorium or other similar laws relating to the enforcement of
     creditors' rights generally or by the application of general
     principles of equity (regardless of whether such enforceability is
     considered in a proceeding in equity or at law), and except that I
     express no opinion as to (i) the subject matter jurisdiction of the
     District Courts of the United States of America to adjudicate any
     controversy relating to the Credit Agreement, the Designation Letter
     of the Designated Subsidiary or the Notes of the Designated Subsidiary
     or (ii) the effect of the law of any jurisdiction (other than the
     State of New York) wherein any Lender or Applicable Lending Office may
     be located or wherein enforcement of the Credit Agreement, the
     Designation Letter of the Designated Subsidiary or the Notes of the
     Designated Subsidiary may be sought which limits rates of interest
     which may be charged or collected by such Lender.

          4. There is no action, suit, investigation, litigation or
     proceeding at law or in equity before any court, governmental agency
     or arbitration now pending or, to the best of my knowledge and belief,
     Threatened against the Designated Subsidiary that is reasonably likely
     to have a Material Adverse Effect or that purports to affect the
     legality, validity or enforceability of the Designation Letter of the
     Designated Subsidiary, the Credit Agreement or any Note of the
     Designated Subsidiary or the consummation of the transactions
     contemplated thereby.

          5. No authorizations, consents, approvals, licenses, filings or
     registrations by or with any governmental authority or administrative
     body are required for the due execution, delivery and performance by
     the Designated Subsidiary of its Designation Letter, the Credit
     Agreement or the Notes of the Designated Subsidiary except for such
     authorizations, consents, approvals, licenses, filings or
     registrations as have heretofore been made, obtained or affected and
     are in full force and effect.

          6. The Designated Subsidiary is not an "investment company"
     within the meaning of the Investment Company Act of 1940, as amended.

          7. The Designated Subsidiary is not a "holding company" within
     the meaning of the Public Utility Holding Company Act of 1935, as
     amended.

          In connection with the opinions expressed by me above in
paragraph 3, I wish to point out that (i) provisions of the Credit
Agreement which permit the Agent or any Lender to take action or make
determinations may be subject to a requirement that such action be taken or
such determinations be made on a reasonable basis and in good faith, (ii) a
party to whom an advance is owed may, under certain circumstances, be
called upon to prove the outstanding amount of the Advances evidenced
thereby and (iii) the rights of the Agent and the Lenders provided for in
Section 9.04(b) of the Credit Agreement may be limited in certain
circumstances.

                                                   Very truly yours,

                        EXHIBIT I - FORM OF OPINION
                          OF SHEARMAN & STERLING,
                            COUNSEL TO THE AGENT

                              [S&S LETTERHEAD]

                                              October 9, 1998

To the Initial Lenders party to the
  Credit Agreement referred
  to below and to Citibank, N.A.,
  as Agent

Ladies and Gentlemen:

          We have acted as special New York counsel to Citibank, N.A., as
Agent, in connection with the preparation, execution and delivery of the
364-Day Backstop Credit Agreement dated as of October 9, 1998 (the "Credit
Agreement"), among AlliedSignal Inc., a Delaware corporation (the
"Company"), and each of you (each a "Lender"). Unless otherwise defined
herein, terms defined in the Credit Agreement are used herein as therein
defined.

          In that connection, we have examined a counterpart of the Credit
Agreement executed by the Company, the Revolving Credit Notes executed by
the Company and delivered on the date hereof (for purposes of this opinion
letter, the "Notes") and, to the extent relevant to our opinion expressed
below, the other documents delivered by the Company pursuant to Section
3.01 of the Credit Agreement.

          In our examination of the Credit Agreement, the Notes and such
other documents, we have assumed, without independent investigation (a) the
due execution and delivery of the Credit Agreement by all parties thereto
and of the Notes by the Company, (b) the genuineness of all signatures, (c)
the authenticity of the originals of the documents submitted to us and (d)
the conformity to originals of any documents submitted to us as copies.

          In addition, we have assumed, without independent investigation,
that (i) the Company is duly organized and validly existing under the laws
of the jurisdiction of its organization and has full power and authority
(corporate and otherwise) to execute, deliver and perform the Credit
Agreement and the Notes and (ii) the execution, delivery and performance by
the Company of the Credit Agreement and the Notes have been duly authorized
by all necessary action (corporate or otherwise) and do not (A) contravene
the certificate of incorporation, bylaws or other constituent documents of
the Company, (B) conflict with or result in the breach of any document or
instrument binding on the Company or (C) violate or require any
governmental or regulatory authorization or other action under any law,
rule or regulation applicable to the Company other than New York law or
United States federal law applicable to borrowers generally or, assuming
the correctness of the Company's statements made as representations and
warranties in Section 4.01(c) of the Credit Agreement, applicable to the
Company. We have also assumed that the Credit Agreement is the legal, valid
and binding obligation of each Lender, enforceable against such Lender in
accordance with its terms.

          Based upon the foregoing examination and assumptions and upon
such other investigation as we have deemed necessary and subject to the
qualifications set forth below, we are of the opinion that the Credit
Agreement and each of the Notes are the legal, valid and binding
obligations of the Company, enforceable against the Company in accordance
with their respective terms.

          Our opinion above is subject to the following qualifications:

          (i) Our opinion above is subject to the effect of any applicable
     bankruptcy, insolvency (including, without limitation, all laws
     relating to fraudulent transfers), reorganization, moratorium or
     similar law affecting creditors' rights generally.

          (ii) Our opinion above is also subject to the effect of general
     principles of equity, including (without limitation) concepts of
     materiality, reasonableness, good faith and fair dealing (regardless
     of whether considered in a proceeding in equity or at law).

          (iii) We express no opinion as to the enforceability of the
     indemnification provisions set forth in Section 9.04 of the Credit
     Agreement to the extent enforcement thereof is contrary to public
     policy regarding the exculpation of criminal violations, intentional
     harm and acts of gross negligence or recklessness.

          (iv) Our opinion above is limited to the law of the State of New
     York and the federal law of the United States of America and we do not
     express any opinion herein concerning any other law. Without limiting
     the generality of the foregoing, we express no opinion as to the
     effect of the law of a jurisdiction other than the State of New York
     wherein any Lender may be located or wherein enforcement of the Credit
     Agreement or any of the Notes may be sought that limits the rates of
     interest legally chargeable or collectible.

          A copy of this opinion letter may be delivered by any of you to
any Person that becomes a Lender in accordance with the provisions of the
Credit Agreement. Any such Lender may rely on the opinion expressed above
as if this opinion letter were addressed and delivered to such Lender on
the date hereof.

          This opinion letter speaks only as of the date hereof. We
expressly disclaim any responsibility to advise you or any other Lender who
is permitted to rely on the opinion expressed herein as specified in the
next preceding paragraph of any development or circumstance of any kind
including any change of law or fact that may occur after the date of this
opinion letter even though such development, circumstance or change may
affect the legal analysis, a legal conclusion or any other matter set forth
in or relating to this opinion letter. Accordingly, any Lender relying on
this opinion letter at any time should seek advice of its counsel as to the
proper application of this opinion letter at such time.

                                                          Very truly yours,
                                                            EXHIBIT 99.2
     [EXECUTION COPY]

                                                          October 9, 1998

AlliedSignal Inc.
101 Columbia Road
Morristown, NJ  07962-1219

Attention: John W. Gamble, Jr., Assistant Treasurer

                             ALLIEDSIGNAL INC.
              US$900,000,000 364-DAY REVOLVING CREDIT FACILITY
             US$7,000,000,000 364-DAY REVOLVING CREDIT FACILITY
            US$2,250,000,000 FIVE YEAR REVOLVING CREDIT FACILITY
                             COMMITMENT LETTER
                             -----------------

Ladies and Gentlemen:

          You have advised us of your proposed acquisition of a controlling
interest in AMP Inc., a Pennsylvania corporation (the "TARGET"). As we
understand the transaction, you have offered to acquire up to 20,000,000
shares of the Target's outstanding common stock, without par value (the
"TARGET STOCK"), on or after October 2, 1998 for $44.50 net per common
share for up to an aggregate of $890,000,000 in cash. This acquisition of
the Target's common shares will initially be funded through the issuance of
your commercial paper. Thereafter, you will promptly offer to purchase
through a tender offer (the "TENDER OFFER"), subject to removal of the
Target's poison pill, the inapplicability of anti-takeover statutes and
other customary conditions, all shares of Target Stock. The Tender Offer,
the acquisition of the Target and the certain financings contemplated by
the foregoing are collectively referred to as the "TRANSACTION".

          You have requested that Salomon Smith Barney Inc., ("SSB"),
Banque Nationale de Paris ("BNP"), Barclays Capital, the investment banking
division of Barclays Bank PLC ("BARCLAYS CAPITAL"), Deutsche Bank
Securities Inc. ("DBSI"), J.P. Morgan Securities Inc. ("MORGAN") and
NationsBanc Montgomery Securities LLC ("NMS") arrange $9,250,000,000 of
Senior Facilities (as hereinafter defined) described in this letter and in
the attached summaries of terms and conditions (the "ANNEXES" and, together
with this letter, the "COMMITMENT LETTER"). Based on our discussions
concerning the Transaction, (a) SSB is pleased to agree to act as book
runner in connection with the Senior Facilities, (b) Citibank, N.A.
("CITIBANK") is pleased to provide you with financing commitments for a
portion of, and to agree to act as administrative agent (the
"ADMINISTRATIVE AGENT") in connection with, the Senior Facilities, (c) each
of the other Initial Lenders (as hereinafter defined) is pleased to provide
you with financing commitments for a portion of the Senior Facilities and
(d) each of SSB, BNP, Barclays, DBSI, Morgan and NMS, as arrangers, is
pleased to provide you with its undertaking to arrange and syndicate the
Senior Facilities to the Lenders (as defined under the section "LENDERS" in
the Annexes). SSB, BNP, Barclays Capital, DBSI, Morgan and NMS are,
collectively, the "ARRANGERS".

          You have asked each of Citibank, Bank of America NT&SA ("BOFA"),
BNP, Barclays Bank PLC ("BARCLAYS"), Deutsche Bank AG, New York Branch
and/or Cayman Islands Branch ("DEUTSCHE BANK") and Morgan Guaranty Trust
Company of New York ("MORGAN GUARANTY") (collectively, the "INITIAL
LENDERS") to provide you with their several commitments for a portion of
the senior debt facilities aggregating $9,250,000,000 (the "SENIOR
FACILITIES") required to consummate the Transaction, consisting of (a) a
364-day multicurrency commercial paper backstop facility (the "BACKSTOP
FACILITY") in the amount of $900,000,000, (b) a 364-day multicurrency
revolving credit facility (the "364-DAY FACILITY") in the amount of
$7,000,000,000 (which will replace the Backstop Facility) and (c) a five
year multicurrency revolving credit facility (the "FIVE-YEAR FACILITY") in
the amount of $2,250,000,000. Each of the Backstop Facility, 364-Day
Facility and the Five-Year Facility will also provide a competitive bid
option to you. The proceeds of the Senior Facilities are intended to be
used primarily in connection with the Transaction, and after the
acquisition of the Target is completed in connection with general corporate
purposes.

          Subject to the satisfaction of the conditions contained in this
Commitment Letter and your acceptance hereof, Citibank commits to lend
$200,000,000 of the Backstop Facility and $1,000,000,000 of the 364-Day and
Five-Year Facilities, and BofA, BNP, Barclays, Deutsche Bank and Morgan
Guaranty each commits to lend $140,000,000 of the Backstop Facility and
$750,000,000 of the 364-Day and Five Year Facilities, on the terms and
conditions referred to in this Commitment Letter. The Arrangers agree to
use their best efforts, but without any obligation to underwrite a
syndication, to arrange a syndicate of lenders for the balance of the
financing for the Transaction (it being understood that none of the
Arrangers or the Initial Lenders, individually or in the aggregate, have
agreed to underwrite the Senior Facilities). The commitment of each Initial
Lender will be allocated pro rata to the 364-Day and Five Year Facilities.

          Please note, however, that the terms and conditions of this
commitment and undertaking are not limited to those set forth in this
Commitment Letter. Those matters that are not covered or made clear herein
or in the attached Annexes are subject to mutual agreement of the parties.
The terms and conditions of this commitment and undertaking may be modified
only in writing. In addition, this commitment and undertaking is subject to
(a) the preparation, execution and delivery of mutually acceptable loan
documentation, including credit agreements incorporating substantially the
terms and conditions outlined herein and in the Annexes, (b) the absence of
(i) a material adverse change in the business, condition (financial or
otherwise), operations, performance, properties or prospects of you and
your subsidiaries, taken as a whole, since December 31, 1997 and (ii) any
material adverse change in loan syndication or financial or capital market
conditions generally from those currently in effect, (c) the accuracy and
completeness of all representations that you make to us and all information
that you furnish to us in connection with this commitment and undertaking
and your compliance with the terms of this Commitment Letter, (d) with
respect to the commitment and undertaking for the 364-Day and Five Year
Facilities, syndication of such Facilities shall have commenced by November
15, 1998 (meaning that the Information Memorandum (as defined below) shall
have been prepared and the bank information meeting shall have been
scheduled to take place no later than one week after such date), (e)
receipt of commitments from other Lenders on the terms and conditions
referred to in the attached Annexes for the balance of the financing of the
Transaction and (f) the acquisition of the Target Stock on a basis or
pursuant to terms not materially different from those previously agreed to
by the Arrangers (it being understood that an increase of the price per
share of Target Stock of 10% or less shall be deemed not to be material).
Each Initial Lender's commitment and each Arranger's undertaking with
respect to the 364-Day Facility and the Five-Year Facility set forth in
this Commitment Letter will terminate on January 25, 1999, unless the loan
documentation relating thereto is executed on or before such date.

          The Initial Lenders' commitments and the Arrangers' undertaking
with respect to the (a) 364-Day Facility and the Five-Year Facility or (b)
the Backstop Facility set forth in this Commitment Letter may also be
terminated upon written notice by you at any time at your option upon
payment of all Agreed Fees (as hereinafter defined) then payable and all
fees, expenses and other amounts then payable under this Commitment Letter.

          The Arrangers intend to syndicate the 364-Day Facility and the
Five-Year Facility promptly and, if the commitments for the 364-Day
Facility and the Five-Year Facility have been terminated, the Backstop
Facility, to additional Lenders and, to the extent that commitments are
received from other Lenders, the initial commitments of each Initial Lender
shall be reduced. The Arrangers will manage all aspects of the syndication
in consultation with you, including the timing of all offers to potential
Lenders and the acceptance of commitments, the amounts offered and the
compensation provided. By acceptance of this Commitment Letter, you agree
to take all actions that the Arrangers may reasonably request to assist
them in forming a syndicate acceptable to the Arrangers. Your assistance in
forming such a syndicate shall include but not be limited to: (a) making
your senior management and representatives available to participate in
information meetings with potential Lenders at such times and places as the
Arrangers may reasonably request; (b) using your best efforts to ensure
that the syndication efforts of the Arrangers benefit from your lending
relationships; (c) providing the Arrangers with all information reasonably
deemed necessary by them to complete a successful syndication and (d)
assisting in the preparation of an information memorandum for use in
connection with the syndication of the Senior Facilities (the "INFORMATION
MEMORANDUM"), the contents of which you shall be solely responsible for.
You agree to advise the Arrangers immediately of the occurrence of any
event or other development that results in the Information Memorandum
failing to comply with the representation and warranties set forth in the
first paragraph on page five of this Commitment Letter.

          To ensure an orderly and effective syndication of the Senior
Facilities, you agree that until the termination of the syndication (as
determined by the Arrangers and evidenced by written notification received
by you from SSB), you will not, and will not permit any of
your affiliates to, syndicate or issue, attempt to syndicate or issue,
announce or authorize the announcement of the syndication or issuance of,
or engage in discussions concerning the syndication or issuance of, any
debt facility or debt security (including any renewals thereof), without
the prior written consent of the Arrangers; provided, however, that the
foregoing shall not limit your ability to amend your $750,000,000 existing
credit agreement, or to issue commercial paper, extendable notes or similar
financial products, other short-term debt instruments not syndicated in the
bank loan market, public debt securities or securitizations.

          You agree that Citibank will act as the sole administrative agent
for the Senior Facilities and that the Arrangers will act as sole arrangers
for the Senior Facilities and that no additional agents, co-agents or
arrangers will be appointed, or other titles conferred, without the prior
consent of each of the Arrangers. You agree that no Lender will receive any
compensation of any kind for its participation in the Senior Facilities,
except as expressly provided for in the Fee Letters (as hereinafter
defined) or in the Annexes.

          In addition to the fees described in the Annexes, you hereby
confirm your agreement to pay the nonrefundable fees set forth in the fee
letters dated the date hereof (the "FEE LETTERS") with the Initial Lenders
and the Arrangers (the "AGREED FEES").

          You agree to indemnify and hold harmless each Initial Lender,
each Arranger, each Lender and each of their affiliates and their officers,
directors, employees, agents, advisors and other representatives (each an
"INDEMNIFIED PARTY") from and against any and all claims, damages, losses,
liabilities and expenses (including, without limitation, reasonable fees
and expenses of counsel) that may be incurred by or asserted or awarded
against any Indemnified Party, in each case arising out of or in connection
with or by reason of (including, without limitation, in connection with any
investigation, litigation or proceeding or preparation of a defense in
connection therewith) (a) the Transaction or any similar transaction and
any of the other transactions contemplated thereby, (b) any acquisition or
proposed acquisition or similar business combination or proposed business
combination (including, without limitation, the transactions contemplated
hereby) by you or any of your subsidiaries or affiliates of all or any
portion of the capital stock or substantially all of the assets of the
Target or any of its subsidiaries or (c) the Senior Facilities and any
other financings, or any use made or proposed to be made with the proceeds
thereof, except to the extent such claim, damage, loss, liability or
expense is found in a final, nonappealable judgment by a court of competent
jurisdiction to have resulted from such Indemnified Party's gross
negligence or willful misconduct. In the case of an investigation,
litigation or proceeding to which the indemnity in this paragraph applies,
such indemnity shall be effective whether or not such investigation,
litigation or proceeding is brought by you, your shareholders or creditors
or an Indemnified Party or an Indemnified Party is otherwise a party
thereto and whether or not the Transaction is consummated. You also agree
that no Indemnified Party shall have any liability (whether direct or
indirect, in contract or tort or otherwise) to you or your subsidiaries or
affiliates or to your or their respective security holders or creditors
arising out of, related to or in connection with the Transaction, except
for direct, as opposed to consequential, damages determined in a final
nonappealable judgment by a court of competent jurisdiction to have
resulted from such Indemnified Party's gross negligence or willful
misconduct.

          In further consideration of the commitment of each Initial Lender
and the undertakings of each Arranger, respectively, hereunder, and
recognizing that in connection herewith each of them is incurring
substantial costs and expenses, including, without limitation, fees and
expenses of counsel and due diligence, syndication (including printing,
distribution and bank meetings), transportation, computer, duplication,
appraisal, audit, insurance, consultant, search, filing and recording fees,
you agree to pay, from time to time on request, such costs and expenses
directly related to the Senior Facilities (whether incurred before or after
the date hereof), regardless of whether the Transaction (or any part
thereof) is consummated or any loan documentation is entered into. You also
agree to pay all costs and expenses of each Initial Lender and each
Arranger (including, without limitation, fees and expenses of counsel)
incurred in connection with the enforcement of this Commitment Letter.

          You should be aware that any Initial Lender, any Arranger or one
or more of their affiliates may be providing financing or other services to
parties whose interests may conflict with yours. However, be assured that,
consistent with each Initial Lender's and each Arranger's longstanding
policies to hold in confidence the affairs of their customers, none of the
Initial Lenders, the Arrangers or any of their affiliates will furnish
confidential information obtained from you to any of their other customers.
By the same token, the Initial Lenders, the Arrangers and their affiliates
will not make available to you confidential information that they have
obtained or may obtain from any other customer.

          You agree that this Commitment Letter is for your confidential
use only and neither its existence nor the terms hereof will be disclosed
by you to any person or entity other than your officers, directors,
accountants, attorneys and other advisors, and then only on a "need to
know" basis in connection with the Transaction and on a confidential basis,
except that, following your return of an executed counterpart hereof to
each Arranger, you may (a) make public disclosure of the existence and
amount of the Initial Lenders' commitments and the Arrangers' undertakings
hereunder, (b) file a copy of this Commitment Letter in any public record
in which it is required by law to be filed, (c) provide a copy of this
Commitment Letter on a confidential basis to the Target and its
accountants, attorneys and other advisors and (d) make such other public
disclosures of the terms and conditions hereof as you are required by law,
in the opinion of your counsel, to make. You agree that you will permit
each Arranger and each Initial Lender to review and approve any reference
to it or to any of its affiliates or any other agent or arranger under the
Senior Facilities contained in any press release or similar public
disclosure prior to public release. Each Initial Lender and Arranger agrees
that you will be permitted to review and approve any reference to you and
your affiliates relating to the Senior Facilities contained in any press
release, advertisement or similar public disclosure prior to public
release.

          You represent and warrant that (a) all information that has been
or will hereafter be made available by or on behalf of you or by any of
your representatives in connection with the Transaction and the other
transactions contemplated hereby to any Initial Lender, any Arranger or any
of their affiliates or representatives or to any Lender or any potential
Lender is and will be complete and correct in all material respects and
does not and will not contain any untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements
contained therein not misleading in light of the circumstances under which
such statements were or are made and (b) all financial projections, if any,
that have been or will be prepared by you or on your behalf or by any of
your representatives and made available to any Initial Lender, any Arranger
or any of their affiliates or representatives or to any Lender or any
potential Lender in connection with the Transaction and the other
transactions contemplated hereby have been or will be prepared in good
faith based upon reasonable assumptions (it being understood that such
projections are subject to significant uncertainties and contingencies,
many of which are beyond your control, and that no assurance can be given
that any particular projections will be realized). You agree to supplement
the information and projections from time to time so that the
representations and warranties contained in this paragraph remain complete
and correct.

          In issuing this commitment and undertaking, each Initial Lender
and each Arranger is relying on the accuracy of the information furnished
to it by you or on your behalf. The obligations of each Initial Lender and
each Arranger under this Commitment Letter and of any Lender that issues a
commitment for the Senior Facilities are made solely for your benefit and
may not be relied upon or enforced by any other person or entity.

          This Commitment Letter shall be governed by, and construed in
accordance with, the laws of the State of New York. Delivery of an executed
counterpart of this Commitment Letter by telecopier shall be effective as
delivery of a manually executed counterpart of this Commitment Letter. Each
of you, each Initial Lender and each Arranger hereby irrevocably waives all
right to trial by jury in any action, proceeding or counterclaim (whether
based on contract, tort or otherwise) arising out of or relating to this
Commitment Letter, the transactions contemplated hereby or the actions of
any Initial Lender or any Arranger in the negotiation, performance or
enforcement hereof.

          Please evidence your acceptance of the provisions of this
Commitment Letter (including, without limitation, the attached Annexes) and
the other matters referred to above by signing the enclosed copy of this
Commitment Letter and returning it to Steven Victorin, Citibank, N.A., 399
Park Avenue, New York, New York 10043 at or before 5:00 P.M. (New York City
time) on October 7, 1998, the time at which each Initial Lender's
commitment and each Arranger's undertaking set forth above (if not so
accepted prior thereto) will expire.

                                    Very truly yours,

                                    CITIBANK, N.A.

                                    By /s/ Carolyn A. Kee
                                      ------------------------------
                                      Name:  Carolyn A. Kee
                                      Title: Attorney-in-Fact

                                    SALOMON SMITH BARNEY INC.

                                    By /s/ Steven R. Victorin
                                      ------------------------------
                                      Name:  Steven R. Victorin
                                      Title: Attorney-in-Fact

                                    BANK OF AMERICA NT&SA

                                    By /s/ W.L. Hess
                                      ------------------------------
                                      Name:  W.L. Hess
                                      Title: Managing Director

                                    NATIONSBANC MONTGOMERY SECURITIES LLC

                                    By /s/ John A. Finan
                                      ------------------------------
                                      Name:  John A. Finan
                                      Title: Managing Director

                                    BANQUE NATIONALE DE PARIS

                                    By /s/ Robert S. Taylor, Jr.
                                      ------------------------------
                                      Name:  Robert S. Taylor, Jr.
                                      Title: Senior Vice President

                                    By /s/ Richard L. Sted
                                      ------------------------------
                                      Name:  Richard L. Sted
                                      Title: Senior Vice President

                                    BARCLAYS BANK PLC

                                    By /s/ Keith Mackie
                                      ------------------------------
                                      Name:  Keith Mackie
                                      Title: Director

                                    DEUTSCHE BANK AG, NEW YORK BRANCH AND/OR 
                                    CAYMAN ISLANDS BRANCH

                                    By /s/ Jean M. Hannigan
                                      ------------------------------
                                      Name:  Jean M. Hannigan
                                      Title: Vice President

                                    By /s/ Susan L. Pearson
                                      ------------------------------
                                      Name:  Susan L. Pearson
                                      Title: Director

                                    DEUTSCHE BANK SECURITIES INC.

                                    By /s/ Jean M. Hannigan
                                      ------------------------------
                                      Name:  Jean M. Hannigan
                                      Title: Vice President

                                    By /s/ Thomas A. Foley
                                      ------------------------------
                                      Name:  Thomas A. Foley
                                      Title: Vice President

                                    MORGAN GUARANTY TRUST COMPANY OF NEW YORK

                                    By /s/ Christopher C. Kunhardt
                                      ------------------------------
                                      Name:  Christopher C. Kunhardt
                                      Title: Vice President

                                    J.P. MORGAN SECURITIES INC.

                                    By /s/ Charles H. King
                                      ------------------------------
                                      Name:  Charles H. King
                                      Title: Vice President

ACCEPTED this 9th day
of October, 1998

ALLIEDSIGNAL INC.

By /s/ Richard F. Wallman
  -------------------------
  Name:  Richard F. Wallman
  Title: Senior Vice President
         and Chief Financial Officer

                             ALLIEDSIGNAL INC.

                      SUMMARY OF TERMS AND CONDITIONS
      $7,000,000,000 364-DAY MULTI CURRENCY REVOLVING CREDIT FACILITY
                       WITH ONE YEAR TERM-OUT OPTION

BORROWERS:              AlliedSignal Inc. (the "Company") and any Designated
                        Subsidiaries (together with the Company, the
                        "Borrowers"), fully and unconditionally guaranteed by
                        the Company.

FACILITY AMOUNT:        $7,000,000,000.

TYPE OF FACILITY:       364-day unsecured revolving credit facility (the
                        "364-Day Facility"). Provided there is no default or
                        Event of Default, the Company will have the option,
                        on the Commitment Termination Date, to convert up to
                        $4,000,000,000 of outstanding Advances into a term
                        loan maturing no later than the first anniversary of
                        the Commitment Termination Date (the "Term Loan
                        Conversion Option").

PURPOSE:                Finance the acquisition of AMP Inc. (the "Target")
                        and general corporate purposes, including commercial
                        paper backstop.

ADMINISTRATIVE
AGENT:                  Citibank, N.A. ("Citibank", or the "Agent").

BOOKRUNNER:             Salomon Smith Barney Inc. ("SSB").

ARRANGERS:              Banque Nationale de Paris ("BNP"), Barclays
                        Capital, the investment banking division of
                        Barclays Bank PLC, Deutsche Bank Securities Inc.,
                        J.P. Morgan Securities Inc., NationsBanc Montgomery
                        Securities LLC and SSB.

LENDERS:                Citibank, Bank of America NT&SA ("BofA"), BNP,
                        Barclays Bank PLC ("Barclays"), Deutsche Bank AG, New
                        York Branch and/or Cayman Islands Branch
                        ("Deutsche"), Morgan Guaranty Trust Company of New
                        York ("Morgan") and other financial institutions
                        acceptable to the Arrangers and the Company.

CLOSING DATE:           Such date as may be agreed upon by the Company, the
                        Arrangers and the Agent.

COMMITMENT
TERMINATION DATE:       364 Days from the Closing Date, subject to the
                        Renewal of Commitments section.

FINAL
MATURITY DATE:          The Commitment Termination Date, provided that, if
                        the Company elects the Term Loan Conversion Option,
                        the Final Maturity Date will be the first anniversary
                        of the Commitment Termination Date.

ADVANCES:               At the applicable Borrower's option, either
                        Eurocurrency Rate Advances, Base Rate Advances or
                        Competitive Bid Advances.  Each Lender will be
                        severally obligated to make its pro rata share of any
                        Eurocurrency Rate Advance or Base Rate Advance.
                        Eurocurrency Rate Advances, at the applicable
                        Borrower's option, may be made in U.S. Dollars,
                        Pounds Sterling, Deutsche Marks, French Francs,
                        Euros/Ecu  and Japanese Yen (the "Major Currencies").

RENEWAL OF
COMMITMENTS:            At least 45 but no earlier than 60 days prior to each
                        anniversary date of the 364-Day Facility and provided
                        all representations and warranties are true and
                        correct in all material respects and no Event of
                        Default has occurred and is continuing, the Company
                        may request that the Lenders extend for an additional
                        364 days the then applicable Commitment Termination
                        Date. The Company may replace any non-consenting
                        Lender by assignment to any consenting Lender or new
                        Lender, or by termination of a non-consenting
                        Lender's commitment.

COMMITMENT
REDUCTION:              The Company will have the right, upon at least three
                        business days' notice, to terminate or cancel, in
                        whole or in part, the unused portion of the 364-Day
                        Facility Amount in excess of the aggregate
                        outstanding Competitive Bid Advances, provided that
                        each partial reduction shall be in a minimum amount
                        of $10,000,000 or any whole multiple of $1,000,000 in
                        excess thereof.  Once terminated, a commitment may
                        not be reinstated.

FACILITY FEE:           At all times unless the Term Loan Conversion Option
                        has been selected and is in effect, an amount which
                        will vary as per attached Pricing Grid, based on the
                        Company's long-term senior unsecured non-credit
                        enhanced debt ratings, payable on each Lender's
                        commitment, irrespective of usage, quarterly in
                        arrears on the last day of each March, June,
                        September and December, and on the Commitment
                        Termination Date.  The Facility Fee shall be
                        calculated on the basis of actual number of days
                        elapsed in a year of 365/366 days.  No Facility Fee
                        will be payable after the Term Loan Conversion Option
                        has been selected and is in effect.

INTEREST RATES AND
INTEREST PERIODS:       At the applicable Borrower's option, any Advance that
                        is made to it will be available at the rates and for
                        the Interest Periods stated below:

                        a)    Base Rate:  a fluctuating rate equal to the
                              Base Rate plus the Applicable Margin.

                              The Base Rate is a fluctuating rate per annum
                              equal at all times to the highest of (i)
                              Citibank's publicly announced "base" rate, (ii)
                              1/2 of 1% percent per annum above the latest
                              three-week moving average of secondary market
                              morning offering rates in the United States for
                              three-month certificates of deposit of major
                              U.S. money market banks, adjusted to the
                              nearest 1/16 of 1%, and (iii) a rate equal to
                              1/2 of 1% per annum above the weighted average
                              of the rates on overnight Federal funds
                              transactions with members of the Federal
                              Reserve System arranged by Federal funds
                              brokers.

                        b)    Eurocurrency Rate: a periodic fixed rate equal
                              to the Eurocurrency Rate plus the
                              Applicable Margin.

                              The Eurocurrency Rate, which is a rate per
                              annum equal to the London Interbank Offered
                              Rate as determined by reference to Dow Jones
                              Markets screen 3750 (or other applicable
                              pages with respect to a Major Currency), or
                              if not applicable the average rate per annum
                              (rounded upward to the nearest 1/16 of 1%) at
                              which deposits in the applicable Major
                              Currency are offered by the Reference Banks
                              to prime banks in the London interbank market
                              at 11:00 A.M. (London time) two business days
                              before the first day of the Interest Period
                              and in amounts approximately equal to the
                              Reference Banks' pro rata share of the
                              contemplated Advance for a given Interest
                              Period and with a maturity equal to such
                              Interest Period, adjusted for reserve
                              requirements and, in the case of particular
                              Major Currencies, as appropriate for such
                              currencies. The Eurocurrency Rate shall be
                              fixed for Interest Periods of 1, 2, 3, 6 or 9
                              months if available to all Lenders.

APPLICABLE MARGIN:      The Applicable Margin means:

                        (i)   for Base Rate  Advances,  0.00 basis  points per
                              annum;

                        (ii)  for Eurocurrency Rate Advances, (i) at all
                              times unless the Term Loan Conversion Option
                              has been selected and is in effect an amount
                              which will vary as per the attached Pricing
                              Grid, based on the Company's long-term senior
                              unsecured non-credit enhanced debt ratings and,
                              (ii) if the Term Loan Conversion Option has
                              been selected and is in effect, an amount which
                              will vary as per the attached Term-Out Option
                              Pricing Grid.

                        Upon the occurrence and during the continuance of any
                        monetary Event of Default, the Applicable Margin will
                        increase by 100 basis points per annum, and if such
                        Advance is a Eurocurrency Rate Advance, it will
                        convert to a Base Rate Advance at the end of the
                        Interest Period then in effect for such Eurocurrency
                        Rate Advance.

REFERENCE BANKS:        Citibank, BofA, BNP, Barclays, Deutsche and Morgan.

INTEREST PAYMENTS:      At the end of each Interest Period for each Advance,
                        but no less frequently than quarterly.  Interest will
                        be computed on a 365/366-day basis for Base Rate
                        Advances and a 360-day basis for Eurocurrency Rate
                        Advances.

UTILIZATION FEE:        As per the attached Pricing Grid, based on the
                        Company's long-term senior unsecured
                        non-credit-enhanced debt ratings.  The Utilization
                        Fee will be added to the Applicable Margin for any
                        date where outstanding Advances exceed 33 1/3% and
                        66 2/3% of commitments.  The Utilization Fee will be
                        calculated on a 360-day basis and will be payable on
                        the same basis as interest.

BORROWINGS:             Borrowings shall be in minimum principal amounts of
                        $10,000,000 and integral multiples of $1,000,000 in
                        excess thereof.  All Advances (other than Competitive
                        Bid Advances) shall be made by the Lenders ratably in
                        proportion to their respective Commitments. Other
                        than Competitive Bid Advances, borrowings will be
                        available on same day notice for Base Rate Advances
                        and 3 business days notice for Eurocurrency Rate
                        Advances.

AVAILABILITY:           From the Closing Date and prior to the Commitment
                        Termination Date, the Borrowers may, subject to the
                        terms of the 364-Day Facility, borrow, repay and
                        reborrow.

COMPETITIVE BID
OPTION:                 The Borrowers may request the Agent to solicit
                        competitive bids from the Lenders (individually a
                        "Bidder" and collectively the "Bidders") for Advances
                        in U.S. Dollars or Foreign Currencies (meaning any
                        currency other than U.S. Dollars which is freely
                        transferable and convertible into U.S. Dollars), for
                        requested maturities of 5 days or more.  Each Bidder
                        will bid at its discretion.  Each Borrower's notice
                        requesting such bids will be given to the Agent at
                        least 1 business day prior to the proposed Advance
                        date for fixed rate U.S. Dollar based bids, at least
                        4 business days prior to the proposed Advance date
                        for Eurocurrency Rate U.S. Dollar based bids, at
                        least 3 business days prior to the proposed Advance
                        date for fixed or local rate based bids in Foreign
                        Currencies and at least 5 business days prior to the
                        proposed Advance date for Eurocurrency Rate based
                        bids in Foreign Currencies, and will specify the
                        proposed date of Advance, amount, currency and
                        maturity date of the proposed Advance, interest
                        payment schedule, the interest rate basis to be used
                        by the Bidders in bidding, the location of such
                        Borrower's account to which funds are to be advanced,
                        and such other terms as such Borrower may specify.
                        The Agent will advise the Bidders of the terms of the
                        applicable Borrower's notice, and such Bidders as
                        elect may submit bids, which the Agent shall provide
                        to such Borrower.

                        The Borrower giving the notice may accept one or more
                        bids, provided that the aggregate outstanding
                        Advances of all Lenders on the date of, and after
                        giving effect to, any Competitive Bid Advance shall
                        not exceed the aggregate Commitments at such time.
                        Bids will be accepted in order of the lowest to the
                        highest rates ("Bid Rates").  The Borrowers may not
                        accept bids in excess of the requested bid amount for
                        any maturity.  If two or more Bidders bid at the same
                        Bid Rate, the amount to be borrowed at such Bid Rate
                        will be allocated among such Bidders in proportion to
                        the amount which each Bidder bid at such Bid Rate.

                        Each Borrowing under the Competitive Bid Option shall
                        be in an amount of not less than $10,000,000 and
                        integral multiples of $1,000,000 in excess thereof.
                        While any such Borrowing is outstanding, it will be
                        deemed usage of the 364-Day Facility for the purposes
                        of availability and the Commitment of each Lender
                        (whether or not a Bidder) shall be reduced and deemed
                        used for all purposes by its pro rata share (based on
                        its respective Commitment) of an amount equal to the
                        outstanding amount of such Borrowing.  However, each
                        Lender's Advance made under the Competitive Bid
                        Option shall not reduce such Lender's obligation to
                        lend its pro rata share of the remaining undrawn
                        Commitment.

COMPETITIVE BID
ADMINISTRATIVE FEE:     As agreed between Citibank and the Company.

ANNUAL AGENCY FEE:      As agreed between Citibank and the Company.

REPAYMENT:              The Borrowers will repay (i) each Advance (other than
                        a Competitive Bid Advance) no later than on the
                        Commitment Termination Date , subject to the Term
                        Loan Conversion Option and (ii) each Competitive Bid
                        Advance at the maturity date specified in the
                        applicable Borrower's notice requesting such
                        Competitive Bid Advance.

OPTIONAL
PREPAYMENT:             Advances (other than Competitive Bid Advances) may be
                        prepaid without penalty, with notice not later than
                        11:00 A.M. for Base Rate Advances, and with two
                        business days notice for Eurocurrency Rate Advances,
                        in minimum amounts of $10,000,000 and increments of
                        $1,000,000 in excess thereof.  The Borrowers will
                        bear all costs related to the prepayment of a
                        Eurocurrency Rate Advance prior to the last day of
                        its Interest Period.  Competitive Bid Advances may
                        not be prepaid unless the invitation for Competitive
                        Bid Advances specifies the right to prepay, and in
                        such case the Borrowers will reimburse the Lender(s)
                        for any funding losses.

LOAN
DOCUMENTATION:          The commitments will be subject to preparation,
                        execution and delivery of mutually acceptable loan
                        documentation which will contain conditions
                        precedent, representations and warranties, covenants,
                        events of default and other provisions customary for
                        facilities of this nature, including, but not limited
                        to, those noted below.  Except as otherwise
                        specifically stated in this term sheet, terms and
                        conditions set forth in documentation for the 364-Day
                        Facility shall be substantially the same as such
                        terms and conditions set forth in the Company's
                        existing $750 million five-year credit facility.

DOLLAR EQUIVALENT
VALUE LIMITATION
FOR ALL ADVANCES:       If at any time the dollar equivalent value of all
                        Advances exceeds 103%  of the Facility Amount, the
                        Borrowers shall promptly make a mandatory prepayment
                        to reduce the dollar equivalent value of all Advances
                        to 100% of the Facility Amount.

DOLLAR EQUIVALENT
VALUE LIMITATION FOR
ADVANCES IN MAJOR
CURRENCIES:             If at any time the dollar equivalent value of all
                        Advances in Major and Alternate Currencies exceeds
                        110% of $200,000,000 (the "Major Currency Sublimit"),
                        the Borrowers shall make a mandatory prepayment at
                        the end of the respective Interest Periods for such
                        Advances to reduce the dollar equivalent value of all
                        Advances in Major Currencies to 100% of the Major
                        Currency Sublimit.

CONDITIONS
PRECEDENT TO
CLOSING:                Customary for facilities of this nature, including,
                        but not limited to:

                        (1)   The Notes, if requested.

                        (2)   Board resolutions.

                        (3)   Incumbency certificate.

                        (4)   Favorable legal opinion from counsel for the
                              Company.

                        (5)   Favorable legal opinion from counsel for the
                              Agent.

                        (6)   Accuracy of representations and warranties.

                        (7)   Amendment of the Borrowers' existing
                              $750,000,000 credit facility to have terms
                              substantially similar to the $2,250,000,000
                              Five-Year Credit Facility among the Borrowers,
                              the Lenders and the Agent.

                        (8)   Termination of commitments and repayment in
                              full of amounts owing under the $900,000,000
                              364-Day Backstop Credit Agreement among the
                              Borrowers, the Lenders and the Agent.
CONDITION PRECEDENT
TO INITIAL ADVANCE:     The Lenders shall be satisfied that any applicable
                        state takeover law and any supermajority charter
                        provisions are not applicable to the acquisition of
                        the Target or that any conditions for avoiding the
                        restrictions set forth therein have been satisfied.

CONDITIONS
PRECEDENT TO ALL
ADVANCES:               Customary for facilities of this nature, including,
                        but not limited to:

                        (1)   All representations and warranties are true and
                              correct in all material respects on and as of
                              the date of the Borrowing, before and after
                              giving effect to such Borrowing and to the
                              application of the proceeds therefrom, as
                              though made on and as of such date; provided
                              that the representation as to no material
                              adverse change shall be made only at Closing
                              and Renewal of Commitments.

                        (2)   No Event of Default or event which, with the
                              giving of notice or passage of time or both,
                              would be an Event of Default, has occurred and
                              is continuing, or would result from such
                              Borrowing.

CONDITIONS PRECEDENT TO
INITIAL ADVANCE TO EACH
BORROWER THAT IS A
DESIGNATED SUBSIDIARY:  Customary for facilities of this nature, including,
                        but not limited to:

                        (1)   Such Borrower's Note if requested;

                        (2)   Representations by the Company that such
                              Borrower has received all governmental
                              authorizations, consents, approvals and
                              licenses under applicable laws and regulations
                              for such Borrower to execute and deliver the
                              Credit Agreement and to perform its obligations
                              thereunder;

                        (3)   Board resolutions of such Borrower;

                        (4)   Incumbency Certificate of such Borrower;

                        (5)   Designation Letter;

                        (6)   Accuracy of representations and warranties of
                              such Borrower;

                        (7)   Favorable legal opinion from counsel for such
                              Borrower.

ADDITIONAL CONDITION
PRECEDENT TO 
COMPETITIVE
BID ADVANCES:           The information provided by the applicable Borrower
                        does not contain an untrue statement or omit to state
                        any material fact necessary to make the statements
                        contained therein, in light of the circumstances
                        under which they are made, not misleading.

REPRESENTATIONS
AND WARRANTIES:         Customary for facilities of this nature, including,
                        but not limited to:

                        (1)   Confirmation of corporate status and authority;

                        (2)   Execution, delivery, and performance of loan
                              documents do not violate law or existing
                              agreements;

                        (3)   No government or regulatory approvals required;

                        (4)   No litigation currently or threatened which is
                              likely to be determined adversely so as to
                              affect materially the ability of the Company to
                              pay its debts, including the Advances, or which
                              would affect the legality, validity and
                              enforceability of the loan documents;

                        (5)   No material adverse change in financial
                              condition or results of operations or prospects
                              since December 31, 1997 for the Company and its
                              Consolidated Subsidiaries taken as a whole;

                        (6)   Accuracy of information, financial statements;

                        (7)   Material compliance with laws and regulations,
                              including ERISA and all applicable
                              environmental laws and regulations;

                        (8)   Legality, validity, binding effect and
                              enforceability of the loan documents;

                        (9)   Not an  investment  company  or  public  utility
                              holding company.

FINANCIAL
COVENANTS:              (1)   Minimum Net Worth greater than or equal to
                              $3,300,000,000;

                        (2)   Limitation on Domestic Subsidiary Indebtedness.

COVENANTS:              Customary for facilities of this nature, including,
                        but not limited to:

                        (1)   Preservation of corporate existence;

                        (2)   Material compliance with laws (including ERISA
                              and applicable environmental laws);

                        (3)   Payment of taxes;

                        (4)   Payment of material obligations;

                        (5)   Visitation rights;

                        (6)   Maintenance of books and records;

                        (7)   Maintenance of properties;

                        (8)   Maintenance of insurance;

                        (9)   Negative pledge and limitations on liens and
                              secured debt with certain exceptions
                              essentially in conformity to Section 1005 of
                              the 1985 Indenture (which will not be
                              incorporated by reference, but will be directly
                              inserted);

                        (10)  Certain restrictions on change of business,
                              consolidations, mergers, sale of assets;

                        (11)  Certain reporting requirements, including
                              financial and ERISA;

                        (12)  Use of proceeds;

                        (13)  Change of control.

EVENTS OF DEFAULT:      Customary for facilities of this nature, including,
                        but not limited to:

                        (1)   Failure to pay principal when due and
                              interest, Facility Fee and Utilization Fee
                              within three business days of when due;

                        (2)   Representations or warranties materially
                              incorrect;

                        (3)   Failure to comply with covenants (with notice
                              and cure periods as applicable);

                        (4)   Cross-default to payment defaults on principal
                              aggregating $100,000,000, excluding defaults on
                              indebtedness to any institution to the extent
                              the Company or a Subsidiary has deposits with
                              such institution sufficient to repay such
                              indebtedness, or to default or event if the
                              effect is to accelerate or permit acceleration
                              of any such debt. This cross default provision
                              shall not apply to debt of any subsidiary or
                              affiliate of the Company located in China,
                              India, Commonwealth of Independent States or
                              Turkey provided that such debt is not
                              guaranteed or supported in any legally
                              enforceable manner by any Borrower or by any
                              subsidiary or affiliate of the Company located
                              outside of these countries, and such default is
                              due to the direct or indirect action of any
                              government entity or agency of these countries
                              and provided further each subsidiary to which
                              this exception applies shall not have assets of
                              more than $80 million individually nor
                              collectively $300 million measured as of the
                              most recent calendar quarter end;

                        (5)   Unsatisfied judgment or order in excess of
                              $100,000,000 individually or in the
                              aggregate. A carve-out will be provided
                              similar to that contained in the second
                              sentence of item (4) immediately above;

                        (6)   Bankruptcy/insolvency;

                        (7)   ERISA Event and aggregate Plan Insufficiencies
                              exceed  $100,000,000, or Plan reorganization or
                              termination resulting in an increase in annual
                              contributions exceeding  $100,000,000.

ECONOMIC MONETARY
UNION:                  Appropriate language will be incorporated into the
                        364-Day Facility to address certain issues that will
                        be raised by the introduction of the Euro on January
                        1, 1999 and the removal from circulation of the
                        various national currency denominations on and after
                        January 1, 2002.

OTHER:                  Loan documentation will include:

                        (1)   Indemnification of Agent and Lenders and their
                              respective affiliates, officers, directors,
                              employees, agents and advisors for any
                              liabilities and expenses arising out of the
                              364-Day Facility or the use of proceeds.

                        (2)   Normal agency language.

                        (3)   Majority Lenders defined as those holding 51%
                              of outstanding Advances (excluding Competitive
                              Bid Advances) or, if none, Commitments.  The
                              consent of all the Lenders will be required to
                              increase the size of the 364-Day Facility, to
                              extend the maturity or to decrease interest
                              rates or fees.

                        (4)   The Company will have the right to replace any
                              Lender through assignment or the addition of a
                              new Lender provided that no Event of Default
                              has occurred and is continuing and no more than
                              3 Lenders in any calendar year may be replaced.
ASSIGNMENTS AND
PARTICIPATIONS:         Each Lender will have the right to assign to one or
                        more Eligible Assignees all or a portion of its
                        rights and obligations under the loan documents with
                        the consent of the Company (not to be unreasonably
                        withheld).  Minimum aggregate assignment level of
                        $10,000,000 and increments of $1,000,000 in excess
                        thereof.  The parties to the assignment (other than
                        the Company) shall pay to the Agent an administrative
                        fee of $3,500 per assignment.

                        Each Lender will also have the right, without the
                        consent of the Company or the Agent, to assign (i) as
                        security, all or part of its rights under the loan
                        documents to any Federal Reserve Bank and (ii) with
                        notice to the Company and the Agent, all or part of
                        its rights or obligations under the loan documents to
                        any of its affiliates.

                        Each Lender will have the right to sell
                        participations in its rights and obligations under
                        the loan documents, subject to customary restrictions
                        on the participants' voting rights.  Each Lender
                        selling a participation shall notify the Company
                        within 30 days of such sale.

YIELD PROTECTION,
TAXES, AND
OTHER DEDUCTIONS:       (1)   The loan documents will contain yield
                              protection provisions, customary for facilities
                              of this nature, protecting the Lenders in the
                              event of unavailability of funding, funding
                              losses, reserve and capital adequacy
                              requirements.

                        (2)   All payments to be free and clear of any
                              present or future taxes, withholdings or other
                              deductions whatsoever (other than income taxes
                              in the jurisdiction of the Lender's applicable
                              lending office).

                        The Company will have the right to replace any Lender
                        which requests reimbursements for amounts owing under
                        (1) and (2) above provided that (i) no Event of
                        Default, or event which with the giving of notice or
                        lapse of time or both would be an Event of Default,
                        has occurred and is continuing, (ii) the Company has
                        satisfied all of its obligations under the Facility
                        relating to such Lender, and (iii) any replacement is
                        acceptable to the Agent and the Company will have
                        paid the Agent a $3,500 administrative fee if such
                        replacement Lender is not an existing Lender.

GOVERNING LAW:          State of New York.

COUNSEL TO
THE AGENT:              Shearman & Sterling

EXPENSES:               The Company shall reimburse each Arranger, the
                        Co-Arranger and Citibank for all agreed out-of-pocket
                        expenses  incurred by them in the negotiation,
                        syndication and execution of the Facility.  Such
                        expenses shall be reimbursed by the Company upon
                        presentation of a statement of account, regardless of
                        whether the transaction contemplated is actually
                        completed or the loan documents are signed.

                             ALLIEDSIGNAL INC.

              $7,000,000,000 364-DAY REVOLVING CREDIT FACILITY
                                PRICING GRID

===============================================================================================
                LEVEL 1       LEVEL 2       LEVEL 3      LEVEL 4       LEVEL 5      LEVEL 6
- -----------------------------------------------------------------------------------------------

BASIS FOR     LT Senior    LT Senior     LT Senior     LT Senior    LT Senior     LT Senior
PRICING       Unsecured    Unsecured     Unsecured     Unsecured    Unsecured     Unsecured
              Debt Rated   Debt Rated    Debt Rated    Debt Rated   Debt Rated    Debt Rated
              At Least A   Less Than     Less Than     Less Than    Less Than     Less Than
              By Standard  Level 1 But   Level 2 But   Level 3 But  Level 4 But   Level 5.
              & Poor's Or  At Least A-   At Least      At Least     At Least
              A2 By        By Standard   BBB+ By       BBB By       BBB-By
              Moody's.     & Poor's Or   Standard &    Standard &   Standard &
                           A3 By         Poor's Or     Poor's Or    Poor's Or
                           Moody's.      BAA1 By       BAA2 By      BAA3 By
                                         Moody's.      Moody's.     Moody's.

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

FACILITY FEE    5.5 bps       7.0 bps       8.5 bps      9.5 bps      12.0 bps      20.0 bps
(FN1)

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

APPLICABLE      17.0 bps     20.5 bps      26.5 bps      30.5 bps     40.5 bps      50.0 bps
MARGIN

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

DRAWN COST    LIBOR+22.5   LIBOR+27.5    LIBOR+35.0    LIBOR+40.0   LIBOR+52.5    LIBOR+70.0
(FN2)         bps          bps           bps           bps          bps           bps

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

UTILIZATION
FEE (USAGE      0.0 bps       2.5 bps       2.5 bps      5.0 bps       5.0 bps      5.0 bps
(greater than
or equal to)
33 1/3% AND 
(less than)
66 2/3%)

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

UTILIZATION
FEE             2.5 bps       5.0 bps       5.0 bps      10.0 bps     10.0 bps      17.5 bps
(USAGE 
(greater than
or equal to)
66 2/3%)

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

FULLY DRAWN    LIBOR+25.0   LIBOR+32.5    LIBOR+40.0    LIBOR+50.0   LIBOR+62.5    LIBOR+87.5
COST (FN3)        bps           bps           bps          bps           bps       bps

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

(1)   Paid quarterly in arrears on each bank's commitment irrespective of usage.
(2)   Facility Fee plus Applicable Margin.
(3)   Drawn Cost plus Utilization Fee.
bps = basis points per annum

                                             ALLIEDSIGNAL INC.

                                  $7,000,000,000 ONE YEAR TERM-OUT OPTION
                                                PRICING GRID

- ----------------------------------------------------------------------------------=============
                LEVEL 1       LEVEL 2       LEVEL 3      LEVEL 4       LEVEL 5      LEVEL 6

- -----------------------------------------------------------------------------------------------
                                                                
BASIS FOR    LT Senior     LT Senior     LT Senior     LT Senior    LT Senior     LT Senior
PRICING      Unsecured     Unsecured     Unsecured     Unsecured    Unsecured     Unsecured
             Debt Rated    Debt Rated    Debt Rated    Debt Rated   Debt Rated    Debt Rated
             At Least A    Less Than     Less Than     Less Than    Less Than     Less Than
             By Standard   Level 1 But   Level 2 But   Level 3 But  Level 4 But   Level 5.
             & Poor's Or   At Least A-   At Least      At Least     At Least
             A2 By         By Standard   BBB+ By       BBB By       BBB-By
             Moody's.      & Poor's Or   Standard &    Standard &   Standard &
                           A3 By         Poor's Or     Poor's Or    Poor's Or
                           Moody's.      BAA1 By       BAA2 By      BAA3 By
                                         Moody's.      Moody's.     Moody's.

===============================================================================================

APPLICABLE     22.5 bps      27.5 bps      35.0 bps      40.0 bps     52.5 bps      70.0 bps
MARGIN

===============================================================================================

UTILIZATION
FEE (USAGE      0.0 bps       2.5 bps       2.5 bps      5.0 bps       5.0 bps      5.0 bps
(greater
than or
equal to)
33 1/3% AND
(less than)
66 2/3%)

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

UTILIZATION
FEE             2.5 bps       5.0 bps       5.0 bps      10.0 bps     10.0 bps      17.5 bps
(USAGE
(greater
than or
equal to)
66 2/3%)

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

FULLY DRAWN   LIBOR+25.0    LIBOR+32.5    LIBOR+40.0    LIBOR+50.0   LIBOR+62.5    LIBOR+87.5
COST (FN1)        bps           bps           bps          bps           bps       bps

===============================================================================================

(1)   Applicable Margin plus Utilization Fee.
bps = basis points per annum

                             ALLIEDSIGNAL INC.

                   $900,000,000 ONE YEAR TERM-OUT OPTION
                                PRICING GRID

==================================================================================================================
                    LEVEL 1         LEVEL 2          LEVEL 3         LEVEL 4         LEVEL 5          LEVEL 6
- ------------------------------------------------------------------------------------------------------------------
                                                                                 
BASIS FOR        LT Senior       LT Senior        LT Senior       LT Senior       LT Senior        LT Senior
PRICING          Unsecured Debt  Unsecured Debt   Unsecured Debt  Unsecured Debt  Unsecured Debt   Unsecured Debt
                 Rated At Least  Rated Less Than  Rated Less      Rated Less      Rated Less Than  Rated Less
                 A By Standard   Level 1 But At   Than Level 2    Than Level 3    Level 4 But At   Than Level 5.
                 & Poor's Or A2  Least A- By      But At Least    But At Least    Least BBB-By
                 By Moody's.     Standard &       BBB+ By         BBB By          Standard &
                                 Poor's Or A3 By  Standard &      Standard &      Poor's Or BAA3
                                 Moody's.         Poor's Or BAA1  Poor's Or BAA2  By Moody's.
                                                  By Moody's.     By Moody's.

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

APPLICABLE          22.5 bps         27.5 bps        35.0 bps        40.0 bps         52.5 bps        70.0 bps
MARGIN

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

UTILIZATION FEE
(USAGE               0.0 bps         2.5 bps          2.5 bps         5.0 bps         5.0 bps          5.0 bps
(greater than
or equal to)
33 1/3% AND 
(less than)
 66 2/3%)

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

UTILIZATION FEE
(USAGE 
(greater than
or equal to)
66 2/3%)             2.5 bps         5.0 bps          5.0 bps        10.0 bps         10.0 bps        17.5 bps

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

FULLY DRAWN      LIBOR+25.0 bps   LIBOR+32.5 bps  LIBOR+40.0 bps  LIBOR+50.0 bps   LIBOR+62.5 bps  LIBOR+87.5 bps
COST(FN1)

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

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

(1)     Applicable Margin plus Utilization Fee.
bps = basis points per annum

                             ALLIEDSIGNAL INC.

                      SUMMARY OF TERMS AND CONDITIONS
       $2,250,000,000 5-YEAR MULTI CURRENCY REVOLVING CREDIT FACILITY

    BORROWERS:                AlliedSignal Inc. (the "Company") and any
                              Designated Subsidiaries (together with the
                              Company, the "Borrowers"), fully and
                              unconditionally guaranteed by the Company.

    FACILITY AMOUNT:          $2,250,000,000 or such other amount as
                              provided for under the Commitment Increase
                              and Commitment Reduction sections of this
                              Summary of Terms and Conditions, but, in any
                              event, no more than $5,000,000,000.

    TYPE OF FACILITY:         Five year unsecured multi currency revolving
                              credit facility (the "5-Year Facility").

    PURPOSE:                  Finance the acquisition of AMP Inc. (the
                              "Target") and general corporate purposes,
                              including commercial paper backstop.

    ADMINISTRATIVE
    AGENT:                    Citibank, N.A. ("Citibank", or the "Agent").

    BOOKRUNNER:               Salomon Smith Barney Inc. ("SSB").

    ARRANGERS:                Banque Nationale de Paris ("BNP"), Barclays
                              Capital, the investment banking division of
                              Barclays Bank PLC, Deutsche Bank Securities
                              Inc., J.P. Morgan Securities, Inc.,
                              NationsBanc Montgomery Securities LLC and
                              SSB.

    LENDERS:                  Citibank, Bank of America NT&SA ("BofA"),
                              BNP, Barclays Bank PLC ("Barclays"), Deutsche
                              Bank AG, New York Branch and/or Cayman
                              Islands Branch ("Deutsche"), Morgan Guaranty
                              Trust Company of New York ("Morgan") and
                              other financial institutions acceptable to
                              the Arrangers and the Company.

    CLOSING DATE:             Such date as may be agreed upon by the
                              Company, the Arrangers and the Agent.

    COMMITMENT
    TERMINATION DATE:         Fifth anniversary of the Closing Date.

    ADVANCES:                 At the applicable Borrower's option, either
                              Eurocurrency Rate Advances, Base Rate
                              Advances or Competitive Bid Advances. Each
                              Lender will be severally obligated to make
                              its pro rata share of any Eurocurrency Rate
                              Advance or Base Rate Advance. Eurocurrency
                              Rate Advances, at the applicable Borrower's
                              option, may be made in U.S. Dollars, Pounds
                              Sterling, Deutsche Marks, French Francs,
                              Euros/Ecu and Japanese Yen (the "Major
                              Currencies").

    COMMITMENT
    INCREASE:                 The Company shall have the right, no more
                              than once a year after Closing, to increase
                              the Facility Amount, in minimum increments of
                              $50,000,000, up to a maximum Facility Amount
                              of $5,000,000,000, provided that no Event of
                              Default, or event which with the giving of
                              notice or lapse of time or both would be an
                              Event of Default, has occurred and is
                              continuing. The Company may offer the
                              increase to (x) its existing Lenders, and
                              each existing Lender will have the right, but
                              no obligation, to commit to all or a portion
                              of the proposed increase (the "Proposed
                              Increased Commitment") or (y) third party
                              financial institutions provided that the
                              minimum commitment of each such institution
                              equals or exceeds $10,000,000.

    COMMITMENT
    REDUCTION:                The Company will have the right, upon at
                              least three business days' notice, to
                              terminate or cancel, in whole or in part, the
                              unused portion of the 5-Year Facility Amount
                              in excess of the aggregate outstanding
                              Competitive Bid Advances, provided that each
                              partial reduction shall be in a minimum
                              amount of $10,000,000 or any whole multiple
                              of $1,000,000 in excess thereof. Once
                              terminated, a commitment may not be
                              reinstated except as provided for in the
                              Commitment Increase section.

    FACILITY FEE:             As per attached Pricing Grid, based on the
                              Company's long-term senior unsecured
                              non-credit enhanced debt ratings, payable on
                              each Lender's commitment, irrespective of
                              usage, quarterly in arrears on the last day
                              of each March, June, September and December,
                              and on the Commitment Termination Date. The
                              Facility Fee shall be calculated on the basis
                              of actual number of days elapsed in a year of
                              365/366 days.

    EXTENSION OF COMMITMENT
    TERMINATION DATE:         At least 45 but no earlier than 60 days prior
                              to each anniversary date of the 5-Year
                              Facility and provided all representations and
                              warranties are true and correct in all
                              material respects and no Event of Default has
                              occurred and is continuing, the Company may
                              request that the Lenders extend for an
                              additional one year the then applicable
                              Commitment Termination Date. The Company may
                              replace any non-consenting Lender by
                              assignment to any consenting Lender or new
                              Lender, or by termination of a non-consenting
                              Lender's commitment.

    INTEREST RATES AND
    INTEREST PERIODS:         At the applicable Borrower's option, any
                              Advance that is made to it will be available
                              at the rates and for the Interest Periods
                              stated below:

                              a)   Base Rate: a fluctuating rate equal to
                                   the Base Rate plus the Applicable
                                   Margin.

                                   The Base Rate is a fluctuating rate per
                                   annum equal at all times to the highest
                                   of (i) Citibank's publicly announced
                                   "base" rate, (ii) 1/2 of 1% percent per
                                   annum above the latest three-week moving
                                   average of secondary market morning
                                   offering rates in the United States for
                                   three-month certificates of deposit of
                                   major U.S. money market banks, adjusted
                                   to the nearest 1/16 of 1%, and (iii) a
                                   rate equal to 1/2 of 1% per annum above
                                   the weighted average of the rates on
                                   overnight Federal funds transactions
                                   with members of the Federal Reserve
                                   System arranged by Federal funds
                                   brokers.

                              b)   Eurocurrency Rate: a periodic fixed rate
                                   equal to the Eurocurrency Rate plus the
                                   Applicable Margin.

                                   The Eurocurrency Rate, which is a rate
                                   per annum equal to the London Interbank
                                   Offered Rate as determined by reference
                                   to Dow Jones Markets screen 3750 (or
                                   other applicable pages with respect to a
                                   Major Currency), or if not applicable
                                   the average rate per annum (rounded
                                   upward to the nearest 1/16 of 1%) at
                                   which deposits in the applicable Major
                                   Currency are offered by the Reference
                                   Banks to prime banks in the London
                                   interbank market at 11:00 A.M. (London
                                   time) two business days before the first
                                   day of the Interest Period and in
                                   amounts approximately equal to the
                                   Reference Banks' pro rata share of the
                                   contemplated Advance for a given
                                   Interest Period and with a maturity
                                   equal to such Interest Period, adjusted
                                   for reserve requirements and, in the
                                   case of particular Major Currencies, as
                                   appropriate for such currencies. The
                                   Eurocurrency Rate shall be fixed for
                                   Interest Periods of 1, 2, 3, 6, 9 or 12
                                   months (9 or 12 month options if
                                   available to all Lenders).

    APPLICABLE MARGIN:        The Applicable Margin means:

                                   (i)  for Base Rate Advances, 0.00 basis
                                        points per annum;

                                   (ii) for Eurocurrency Rate Advances, an
                                        amount which will vary as per the
                                        attached Pricing Grid, based on the
                                        Company's long-term senior
                                        unsecured non-credit enhanced debt
                                        ratings.

                              Upon the occurrence and during the
                              continuance of any monetary Event of Default,
                              the Applicable Margin will increase by 100
                              basis points per annum, and if such Advance
                              is a Eurocurrency Rate Advance, it will
                              convert to a Base Rate Advance at the end of
                              the Interest Period then in effect for such
                              Eurocurrency Rate Advance.

    REFERENCE BANKS:          Citibank, BofA, BNP, Barclays, Deutsche and
                              Morgan.

    INTEREST PAYMENTS:        At the end of each Interest Period for each
                              Advance, but no less frequently than
                              quarterly. Interest will be computed on a
                              365/366-day basis for Base Rate Advances and
                              a 360-day basis for Eurocurrency Rate
                              Advances.

    UTILIZATION FEE:          As per the attached Pricing Grid, based on
                              the Company's long-term senior unsecured
                              non-credit-enhanced debt ratings. The
                              Utilization Fee will be added to the
                              Applicable Margin for any date where
                              outstanding Advances exceed 33 1/3% and 66
                              2/3% of commitments. The Utilization Fee will
                              be calculated on a 360-day basis and will be
                              payable on the same basis as interest.

    BORROWINGS:               Borrowings shall be in minimum principal
                              amounts of $10,000,000 and integral multiples
                              of $1,000,000 in excess thereof. All Advances
                              (other than Competitive Bid Advances) shall
                              be made by the Lenders ratably in proportion
                              to their respective Commitments. Other than
                              Competitive Bid Advances, borrowings will be
                              available on same day notice for Base Rate
                              Advances and 3 business days notice for
                              Eurocurrency Rate Advances.

    AVAILABILITY:             From the Closing Date and prior to the
                              Commitment Termination Date, the Borrowers
                              may, subject to the terms of the 5-Year
                              Facility, borrow, repay and reborrow.

    COMPETITIVE BID
    OPTION:                   The Borrowers may request the Agent to
                              solicit competitive bids from the Lenders
                              (individually a "Bidder" and collectively the
                              "Bidders") for Advances in U.S. Dollars or
                              Foreign Currencies (meaning any currency
                              other than U.S. Dollars which is freely
                              transferable and convertible into U.S.
                              Dollars), for requested maturities of 5 days
                              or more. Each Bidder will bid at its
                              discretion. Each Borrower's notice requesting
                              such bids will be given to the Agent at least
                              1 business day prior to the proposed Advance
                              date for fixed rate U.S. Dollar based bids,
                              at least 4 business days prior to the
                              proposed Advance date for Eurocurrency Rate
                              U.S. Dollar based bids, at least 3 business
                              days prior to the proposed Advance date for
                              fixed or local rate based bids in Foreign
                              Currencies and at least 5 business days prior
                              to the proposed Advance date for Eurocurrency
                              Rate based bids in Foreign Currencies, and
                              will specify the proposed date of Advance,
                              amount, currency and maturity date of the
                              proposed Advance, interest payment schedule,
                              the interest rate basis to be used by the
                              Bidders in bidding, the location of such
                              Borrower's account to which funds are to be
                              advanced, and such other terms as such
                              Borrower may specify. The Agent will advise
                              the Bidders of the terms of the applicable
                              Borrower's notice, and such Bidders as elect
                              may submit bids, which the Agent shall
                              provide to such Borrower.

                              The Borrower giving the notice may accept one
                              or more bids, provided that the aggregate
                              outstanding Advances of all Lenders on the
                              date of, and after giving effect to, any
                              Competitive Bid Advance shall not exceed the
                              aggregate Commitments at such time. Bids will
                              be accepted in order of the lowest to the
                              highest rates ("Bid Rates"). The Borrowers
                              may not accept bids in excess of the
                              requested bid amount for any maturity. If two
                              or more Bidders bid at the same Bid Rate, the
                              amount to be borrowed at such Bid Rate will
                              be allocated among such Bidders in proportion
                              to the amount which each Bidder bid at such
                              Bid Rate.

                              Each Borrowing under the Competitive Bid
                              Option shall be in an amount of not less than
                              $10,000,000 and integral multiples of
                              $1,000,000 in excess thereof. While any such
                              Borrowing is outstanding, it will be deemed
                              usage of the 5-Year Facility for the purposes
                              of availability and the Commitment of each
                              Lender (whether or not a Bidder) shall be
                              reduced and deemed used for all purposes by
                              its pro rata share (based on its respective
                              Commitment) of an amount equal to the
                              outstanding amount of such Borrowing.
                              However, each Lender's Advance made under the
                              Competitive Bid Option shall not reduce such
                              Lender's obligation to lend its pro rata
                              share of the remaining undrawn Commitment.

    COMPETITIVE BID
    ADMINISTRATIVE FEE:       As agreed between Citibank and the Company.

    ANNUAL AGENCY FEE:        As agreed between Citibank and the Company.

    REPAYMENT:                The Borrowers shall repay (i) each Advance
                              (including a Competitive Bid Advance) no
                              later than on the Commitment Termination Date
                              and (ii) each Competitive Bid Advance at the
                              maturity date specified in the applicable
                              Borrower's notice requesting such Competitive
                              Bid Advance.

    OPTIONAL
    PREPAYMENT:               Advances (other than Competitive Bid
                              Advances) may be prepaid without penalty,
                              with notice not later than 11:00 A.M. for
                              Base Rate Advances, and with two business
                              days notice for Eurocurrency Rate Advances,
                              in minimum amounts of $10,000,000 and
                              increments of $1,000,000 in excess thereof.
                              The Borrowers will bear all costs related to
                              the prepayment of a Eurocurrency Rate Advance
                              prior to the last day of its Interest Period.
                              Competitive Bid Advances may not be prepaid
                              unless the invitation for Competitive Bid
                              Advances specifies the right to prepay, and
                              in such case the Borrowers will reimburse the
                              Lender(s) for any funding losses.

    LOAN
    DOCUMENTATION:            The commitments will be subject to
                              preparation, execution and delivery of
                              mutually acceptable loan documentation which
                              will contain conditions precedent,
                              representations and warranties, covenants,
                              events of default and other provisions
                              customary for facilities of this nature,
                              including, but not limited to, those noted
                              below. Except as otherwise specifically
                              stated in this term sheet, terms and
                              conditions set forth in documentation for the
                              5-Year Facility shall be substantially the
                              same as such terms and conditions set forth
                              in the Company's existing $750 million
                              five-year facility.

    DOLLAR EQUIVALENT
    VALUE LIMITATION
    FOR ALL ADVANCES:         If at any time the dollar equivalent value of
                              all Advances exceeds 103% of the Facility
                              Amount, the Borrowers shall promptly make a
                              mandatory prepayment to reduce the dollar
                              equivalent value of all Advances to 100% of
                              the Facility Amount.

    DOLLAR EQUIVALENT
    VALUE LIMITATION FOR
    ADVANCES IN MAJOR
    CURRENCIES:               If at any time the dollar equivalent value of
                              all Advances in Major and Alternate
                              Currencies exceeds 110% of $200,000,000 (the
                              "Major Currency Sublimit"), the Borrowers
                              shall make a mandatory prepayment at the end
                              of the respective Interest Periods for such
                              Advances to reduce the dollar equivalent
                              value of all Advances in Major Currencies to
                              100% of the Major Currency Sublimit.

    CONDITIONS
    PRECEDENT TO
    CLOSING:                  Customary for facilities of this nature,
                              including, but not limited to:

                              (1)  The Notes, if requested.

                              (2)  Board resolutions.

                              (3)  Incumbency certificate.

                              (4)  Favorable legal opinion from counsel for
                                   the Company.

                              (5)  Favorable legal opinion from counsel for
                                   the Agent.

                              (6)  Accuracy of representations and
                                   warranties.

                              (7)  Amendment of the Borrowers' existing
                                   $750,000,000 credit facility to have
                                   terms substantially similar to this
                                   Facility.

    CONDITIONS PRECEDENT
    TO INITIAL ADVANCE:       The Lenders shall be satisfied that any
                              applicable state takeover law and any
                              supermajority charter provisions are not
                              applicable to the acquisition of the Target
                              or that any conditions for avoiding the
                              restrictions set forth therein have been
                              satisfied.

    CONDITIONS
    PRECEDENT TO ALL
    ADVANCES:                 Customary for facilities of this nature,
                              including, but not limited to:

                              (1)  All representations and warranties are
                                   true and correct in all material
                                   respects on and as of the date of the
                                   Borrowing, before and after giving
                                   effect to such Borrowing and to the
                                   application of the proceeds therefrom,
                                   as though made on and as of such date;
                                   provided that the representation as to
                                   no material adverse change shall be made
                                   only at Closing and Extension of
                                   Termination Date.

                              (2)  No Event of Default or event which, with
                                   the giving of notice or passage of time
                                   or both, would be an Event of Default,
                                   has occurred and is continuing, or would
                                   result from such Borrowing.

    CONDITIONS PRECEDENT TO
    INITIAL ADVANCE TO EACH
    BORROWER THAT IS A
    DESIGNATED SUBSIDIARY:    Customary for facilities of this nature,
                              including, but not limited to:

                              (1)  Such Borrower's Note, if requested;

                              (2)  Representations by the Company that such
                                   Borrower has received all governmental
                                   authorizations, consents, approvals and
                                   licenses under applicable laws and
                                   regulations for such Borrower to execute
                                   and deliver the Credit Agreement and to
                                   perform its obligations thereunder;

                              (3)  Board resolutions of such Borrower;

                              (4)  Incumbency Certificate of such Borrower;

                              (5)  Designation Letter;

                              (6)  Accuracy of representations and
                                   warranties of such Borrower;

                              (7)  Favorable legal opinion from counsel for
                                   such Borrower.

    ADDITIONAL CONDITION
    PRECEDENT TO COMPETITIVE
    BID ADVANCES:             The information provided by the applicable
                              Borrower does not contain an untrue statement
                              or omit to state any material fact necessary
                              to make the statements contained therein, in
                              light of the circumstances under which they
                              are made, not misleading.

    REPRESENTATIONS
    AND WARRANTIES:           Customary for facilities of this nature,
                              including, but not limited to:

                              (1)  Confirmation of corporate status and
                                   authority;

                              (2)  Execution, delivery, and performance of
                                   loan documents do not violate law or
                                   existing agreements;

                              (3)  No government or regulatory approvals
                                   required;

                              (4)  No litigation currently or threatened
                                   which is likely to be determined
                                   adversely so as to affect materially the
                                   ability of the Company to pay its debts,
                                   including the Advances, or which would
                                   affect the legality, validity and
                                   enforceability of the loan documents;

                              (5)  No material adverse change in financial
                                   condition or results of operations or
                                   prospects since December 31, 1997 for
                                   the Company and its Consolidated
                                   Subsidiaries taken as a whole;

                              (6)  Accuracy of information, financial
                                   statements;

                              (7)  Material compliance with laws and
                                   regulations, including ERISA and all
                                   applicable environmental laws and
                                   regulations;

                              (8)  Legality, validity, binding effect and
                                   enforceability of the loan documents;

                              (9)  Not an investment company or public
                                   utility holding company.

    FINANCIAL
    COVENANTS:                (1)  Minimum Net Worth greater than or equal
                                   to $3,300,000,000;

                              (2)  Limitation on Domestic Subsidiary
                                   Indebtedness.

    OTHER COVENANTS:          Customary for facilities of this nature,
                              including, but not limited to:

                              (1)  Preservation of corporate existence;

                              (2)  Material compliance with laws (including
                                   ERISA and applicable environmental
                                   laws);

                              (3)  Payment of taxes;

                              (4)  Payment of material obligations;

                              (5)  Visitation rights;

                              (6)  Maintenance of books and records;

                              (7)  Maintenance of properties;

                              (8)  Maintenance of insurance;

                              (9)  Negative pledge and limitations on liens
                                   and secured debt with certain exceptions
                                   essentially in conformity to Section
                                   1005 of the 1985 Indenture (which will
                                   not be incorporated by reference, but
                                   will be directly inserted);

                              (10) Certain restrictions on change of
                                   business, consolidations, mergers, sale
                                   of assets;

                              (11) Certain reporting requirements,
                                   including financial and ERISA;

                              (12) Use of proceeds;

                              (13) Change of control.

    EVENTS OF DEFAULT:        Customary for facilities of this nature,
                              including, but not limited to:

                              (1)  Failure to pay principal when due and
                                   interest, Facility Fee and Utilization
                                   Fee within three business days of when
                                   due;

                              (2)  Representations or warranties materially
                                   incorrect;

                              (3)  Failure to comply with covenants (with
                                   notice and cure periods as applicable);

                              (4)  Cross-default to payment defaults on
                                   principal aggregating $100,000,000,
                                   excluding defaults on indebtedness to
                                   any institution to the extent the
                                   Company or a Subsidiary has deposits
                                   with such institution sufficient to
                                   repay such indebtedness, or to default
                                   or event if the effect is to accelerate
                                   or permit acceleration of any such debt.
                                   This cross default provision shall not
                                   apply to debt of any subsidiary or
                                   affiliate of the Company located in
                                   China, India, Commonwealth of
                                   Independent States or Turkey provided
                                   that such debt is not guaranteed or
                                   supported in any legally enforceable
                                   manner by any Borrower or by any
                                   subsidiary or affiliate of the Company
                                   located outside of these countries, and
                                   such default is due to the direct or
                                   indirect action of any government entity
                                   or agency of these countries and
                                   provided further each subsidiary to
                                   which this exception applies shall not
                                   have assets of more than $80 million
                                   individually nor collectively $300
                                   million measured as of the most recent
                                   calendar quarter end;

                              (5)  Unsatisfied judgment or order in excess
                                   of $100,000,000 individually or in the
                                   aggregate. A carve-out will be provided
                                   similar to that contained in the second
                                   sentence of item (4) immediately above;

                              (6)  Bankruptcy/insolvency;

                              (7)  ERISA Event and aggregate Plan
                                   Insufficiencies exceed $100,000,000, or
                                   Plan reorganization or termination
                                   resulting in an increase in annual
                                   contributions exceeding $100,000,000.

    ECONOMIC MONETARY
    UNION:                    Appropriate language will be incorporated
                              into the 5-Year Facility to address certain
                              issues that will be raised by the
                              introduction of the Euro on January 1, 1999
                              and the removal from circulation of the
                              various national currency denominations on
                              and after January 1, 2002.

    OTHER:                    Loan documentation will include:

                              (1)  Indemnification of Agent and Lenders and
                                   their respective affiliates, officers,
                                   directors, employees, agents and
                                   advisors for any liabilities and
                                   expenses arising out of the 5-Year
                                   Facility or the use of proceeds.

                              (2)  Normal agency language.

                              (3)  Majority Lenders defined as those
                                   holding 51% of outstanding Advances
                                   (excluding Competitive Bid Advances) or,
                                   if none, Commitments. The consent of all
                                   the Lenders will be required to increase
                                   the size of the 5-Year Facility (other
                                   than as provided for in the Commitment
                                   Increase section), to extend the
                                   maturity or to decrease interest rates
                                   or fees.

                              (4)  The Company will have the right to
                                   replace any Lender through assignment or
                                   the addition of a new Lender, provided
                                   that no Event of Default has occurred
                                   and is continuing and no more than 3
                                   Lenders in any calendar year may be
                                   replaced.

    ASSIGNMENTS AND
    PARTICIPATIONS:           Each Lender will have the right to assign to
                              one or more Eligible Assignees all or a
                              portion of its rights and obligations under
                              the loan documents with the consent of the
                              Company (not to be reasonably withheld).
                              Minimum aggregate assignment level of
                              $10,000,000 and increments of $1,000,000 in
                              excess thereof. The parties to the assignment
                              (other than the Company) shall pay to the
                              Agent an administrative fee of $3,500 per
                              assignment.

                              Each Lender will also have the right, without
                              the consent of the Company or the Agent, to
                              assign (i) as security, all or part of its
                              rights under the loan documents to any
                              Federal Reserve Bank and (ii) with notice to
                              the Company and the Agent, all or part of its
                              rights or obligations under the loan
                              documents to any of its affiliates.

                              Each Lender will have the right to sell
                              participations in its rights and obligations
                              under the loan documents, subject to
                              customary restrictions on the participants'
                              voting rights. Each Lender selling a
                              participation shall notify the Company within
                              30 days of such sale.

    YIELD PROTECTION,
    TAXES, AND
    OTHER DEDUCTIONS:         (1)  The loan documents will contain yield
                                   protection provisions, customary for
                                   facilities of this nature, protecting
                                   the Lenders in the event of
                                   unavailability of funding, funding
                                   losses, reserve and capital adequacy
                                   requirements.

                              (2)  All payments to be free and clear of any
                                   present or future taxes, withholdings or
                                   other deductions whatsoever (other than
                                   income taxes in the jurisdiction of the
                                   Lender's applicable lending office).

                              The Company will have the right to replace
                              any Lender which requests reimbursements for
                              amounts owing under (1) and (2) above,
                              provided that (i) no Event of Default, or
                              event which with the giving of notice or
                              lapse of time or both would be an Event of
                              Default, has occurred and is continuing, (ii)
                              the Company has satisfied all of its
                              obligations under the Facility relating to
                              such Lender, and (iii) any replacement is
                              acceptable to the Agent and the Company will
                              have paid the Agent a $3,500 administrative
                              fee if such replacement Lender is not an
                              existing Lender.

    GOVERNING LAW:            State of New York.

    COUNSEL TO
    THE AGENT:                Shearman & Sterling

    EXPENSES:                 The Company shall reimburse each Arranger,
                              the Co-Arranger and Citibank for all agreed
                              out-of-pocket expenses incurred by them in
                              the negotiation, syndication and execution of
                              the Facility. Such expenses shall be
                              reimbursed by the Company upon presentation
                              of a statement of account, regardless of
                              whether the transaction contemplated is
                              actually completed or the loan documents are
                              signed.

                             ALLIEDSIGNAL INC.

              $2,250,000,000 5-YEAR REVOLVING CREDIT FACILITY
                                PRICING GRID

============================================================================================

               LEVEL 1      LEVEL 2     LEVEL 3     LEVEL 4      LEVEL 5     LEVEL 6
- ------------- ----------- ------------ ----------- ----------- ------------ ---------
                                                          
BASIS FOR     LT Senior   LT Senior    LT Senior   LT Senior   LT Senior    LT Senior
PRICING       Unsecured   Unsecured    Unsecured   Unsecured   Unsecured    Unsecured
              Debt        Debt Rated   Debt        Debt        Debt Rated   Debt
              Rated At    Less Than    Rated       Rated       Less Than    Rated
              Least A     Level 1      Less Than   Less        Level 4      Less Than
              By          But At       Level 2     Than        But At       Level 5.
              Standard    Least A-     But At      Level 3     Least BBB-
              & Poor's    By           Least       But At      By
              Or A2 By    Standard &   BBB+ By     Least BBB   Standard &
              Moody's.    Poor's Or    Standard    By          Poor's Or
                          A3 by        & Poor's    Standard    BAA3 By
                          Moody's.     Or BAA1     & Poor's    Moody's.
                                       by          Or BAA2
                                       Moody's.    By
                                                   Moody's.
- ------------- ----------- ------------ ----------- ----------- ------------ ---------
FACILITY       7.5 bps      9.0 bps     10.5 bps    12.0 bps    14.5 bps     25.0 bps
FEE(FN1)
- ------------- ----------- ------------ ----------- ----------- ------------ ---------
APPLICABLE     15.0 bps    18.5 bps     24.5 bps    28.50bps    38.0 bps     45.0 bps
MARGIN
- ------------- ----------- ------------ ----------- ----------- ------------ ---------
DRAWN         LIBOR          LIBOR     LIBOR       LIBOR          LIBOR     LIBOR
COST(FN2)     +22.5 bps    +27.5 bps   +35.0 bps   +40.0 bps    +52.5 bps   +70.0 bps
- ------------- ----------- ------------ ----------- ----------- ------------ ---------
UTILIZATION    0.0 bps      2.5 bps     2.5 bps     5.0 bps      5.0 bps     5.0 bps
FEE (USAGE
(greater
than or
equal to)
33 1/3% AND
(less than)
66 2/3%)
- ------------- ----------- ------------ ----------- ----------- ------------ ---------

UTILIZATION    2.5 bps      5.0 bps     5.0 bps     10.0 bps    10.0 bps     17.5 bps
FEE (USAGE
(greater
than or
equal to)
66 2/3%)
- ------------- ----------- ------------ ----------- ----------- ------------ ---------
FULLY DRAWN   LIBOR          LIBOR     LIBOR       LIBOR          LIBOR     LIBOR
COST(FN3)     +25.0 bps    +32.5 bps   +40.0 bps   +50.0 bps    +62.5 bps   +87.5 bps

============================================================================================

          (1)     Paid quarterly in arrears on each bank's commitment irrespective of usage.
          (2)     Facility Fee plus Applicable Margin.
          (3)     Drawn Cost plus Utilization Fee.
                  bps = basis points per annum

                             ALLIEDSIGNAL INC.

                      SUMMARY OF TERMS AND CONDITIONS
       $900,000,000 364-DAY MULTI CURRENCY REVOLVING CREDIT FACILITY
                       WITH ONE YEAR TERM-OUT OPTION

BORROWERS:               AlliedSignal Inc. (the "Company") and any
                         Designated Subsidiaries (together with the
                         Company, the "Borrowers"), fully and
                         unconditionally guaranteed by the Company.

FACILITY AMOUNT:         $900,000,000.

TYPE OF FACILITY:        364-day unsecured revolving credit facility (the
                         "Backstop Facility"). Provided there is no default
                         or Event of Default, the Company will have the
                         option, on the Commitment Termination Date, to
                         convert outstanding Advances into a term loan
                         maturing no later than the first anniversary of
                         the Commitment Termination Date (the "Term Loan
                         Conversion Option").

PURPOSE:                 Finance the acquisition of AMP Inc. (the "Target")
                         and general corporate purposes, including
                         commercial paper backstop.

ADMINISTRATIVE AGENT:    Citibank, N.A. ("Citibank", or the "Agent").

BOOKRUNNER:              Salomon Smith Barney Inc. ("SSB").

ARRANGERS:               Banque Nationale de Paris ("BNP"), Barclays
                         Capital, the investment banking division of
                         Barclays Bank PLC, Deutsche Bank Securities Inc.,
                         J.P. Morgan Securities Inc., NationsBanc
                         Montgomery Securities LLC and SSB.

LENDERS:                 Citibank, Bank of America NT&SA ("BofA"), BNP,
                         Barclays Bank PLC ("Barclays"), Deutsche Bank AG,
                         New York Branch and/or Cayman Islands Branch
                         ("Deutsche"), Morgan Guaranty Trust Company of New
                         York ("Morgan") and other financial institutions
                         acceptable to the Arrangers and the Company.

CLOSING DATE:            Such date as may be agreed upon by the Company,
                         the Arrangers and the Agent.

COMMITMENT
TERMINATION DATE:        364 days from the Closing Date, subject to the
                         Renewal of Commitments section.

FINAL
MATURITY DATE:           The Commitment Termination Date, provided that, if
                         the Company elects the Term Loan Conversion
                         Option, the Final Maturity Date will be the first
                         anniversary of the Commitment Termination Date.

ADVANCES:                At the applicable Borrower's option, either
                         Eurocurrency Rate Advances, Base Rate Advances or
                         Competitive Bid Advances. Each Lender will be
                         severally obligated to make its pro rata share of
                         any Eurocurrency Rate Advance or Base Rate
                         Advance. Eurocurrency Rate Advances, at the
                         applicable Borrower's option, may be made in U.S.
                         Dollars, Pounds Sterling, Deutsche Marks, French
                         Francs, Euros/Ecu and Japanese Yen (the "Major
                         Currencies").

RENEWAL OF
COMMITMENTS:             At least 45 but no earlier than 60 days prior to
                         each anniversary date of the Backstop Facility and
                         provided all representations and warranties are
                         true and correct in all material respects and no
                         Event of Default has occurred and is continuing,
                         the Company may request that the Lenders extend
                         for an additional 364 days the then applicable
                         Commitment Termination Date. The Company may
                         replace any non-consenting Lender by assignment to
                         any consenting Lender or new Lender, or by
                         termination of a non-consenting Lender's
                         commitment.

COMMITMENT
REDUCTION:               The Company will have the right, upon at least
                         three business days' notice, to terminate or
                         cancel, in whole or in part, the unused portion of
                         the Backstop Facility Amount in excess of the
                         aggregate outstanding Competitive Bid Advances,
                         provided that each partial reduction shall be in a
                         minimum amount of $10,000,000 or any whole
                         multiple of $1,000,000 in excess thereof. Once
                         terminated, a commitment may not be reinstated.

FACILITY FEE:            At all times unless the Term Loan Conversion
                         Option has been selected and is in effect, an
                         amount which will vary as per attached Pricing
                         Grid, based on the Company's long-term senior
                         unsecured non-credit enhanced debt ratings,
                         payable on each Lender's commitment, irrespective
                         of usage, quarterly in arrears on the last day of
                         each March, June, September and December, and on
                         the Commitment Termination Date. The Facility Fee
                         shall be calculated on the basis of actual number
                         of days elapsed in a year of 365/366 days. No
                         Facility Fee will be payable after the Term Loan
                         Conversion Option has been selected and is in
                         effect.

INTEREST RATES AND
INTEREST PERIODS:        At the applicable Borrower's option, any Advance
                         that is made to it will be available at the rates
                         and for the Interest Periods stated below:

                         a)   Base Rate: a fluctuating rate equal to the
                              Base Rate plus the Applicable Margin.

                              The Base Rate is a fluctuating rate per annum
                              equal at all times to the highest of (i)
                              Citibank's publicly announced "base" rate,
                              (ii) 1/2 of 1% percent per annum above the
                              latest three-week moving average of secondary
                              market morning offering rates in the United
                              States for three-month certificates of
                              deposit of major U.S. money market banks,
                              adjusted to the nearest 1/16 of 1%, and (iii)
                              a rate equal to 1/2 of 1% per annum above the
                              weighted average of the rates on overnight
                              Federal funds transactions with members of
                              the Federal Reserve System arranged by
                              Federal funds brokers.

                         b)   Eurocurrency Rate: a periodic fixed rate
                              equal to the Eurocurrency Rate plus the
                              Applicable Margin.

                              The Eurocurrency Rate, which is a rate per
                              annum equal to the London Interbank Offered
                              Rate as determined by reference to Dow Jones
                              Markets screen 3750 (or other applicable
                              pages with respect to a Major Currency), or
                              if not applicable the average rate per annum
                              (rounded upward to the nearest 1/16 of 1%) at
                              which deposits in the applicable Major
                              Currency are offered by the Reference Banks
                              to prime banks in the London interbank market
                              at 11:00 A.M. (London time) two business days
                              before the first day of the Interest Period
                              and in amounts approximately equal to the
                              Reference Banks' pro rata share of the
                              contemplated Advance for a given Interest
                              Period and with a maturity equal to such
                              Interest Period, adjusted for reserve
                              requirements and, in the case of particular
                              Major Currencies, as appropriate for such
                              currencies. The Eurocurrency Rate shall be
                              fixed for Interest Periods of 1, 2, 3, 6 or 9
                              months if available to all Lenders.

APPLICABLE MARGIN:       The Applicable Margin means:

                         (i)  for Base Rate Advances, 0.00 basis points per
                              annum;

                         (ii) for Eurocurrency Rate Advances, (i) at all
                              times unless the Term Loan Conversion Option
                              has been selected and is in effect an amount
                              which will vary as per the attached Pricing
                              Grid, based on the Company's long-term senior
                              unsecured non-credit enhanced debt ratings
                              and, (ii) if the Term Loan Conversion Option
                              has been selected and is in effect, an amount
                              which will vary as per the attached Term-Out
                              Option Pricing Grid.

                         Upon the occurrence and during the continuance of
                         any monetary Event of Default, the Applicable
                         Margin will increase by 100 basis points per
                         annum, and if such Advance is a Eurocurrency Rate
                         Advance, it will convert to a Base Rate Advance at
                         the end of the Interest Period then in effect for
                         such Eurocurrency Rate Advance.

REFERENCE BANKS:         Citibank, BofA, BNP, Barclays, Deutsche and
                         Morgan.

INTEREST PAYMENTS:       At the end of each Interest Period for each
                         Advance, but no less frequently than quarterly.
                         Interest will be computed on a 365/366-day basis
                         for Base Rate Advances and a 360-day basis for
                         Eurocurrency Rate Advances.

UTILIZATION FEE:         As per the attached Pricing Grid, based on the
                         Company's long-term senior unsecured
                         non-credit-enhanced debt ratings. The Utilization
                         Fee will be added to the Applicable Margin for any
                         date where outstanding Advances exceed 33 1/3% and
                         66 2/3% of commitments. The Utilization Fee will
                         be calculated on a 360-day basis and will be
                         payable on the same basis as interest.

BORROWINGS:              Borrowings shall be in minimum principal amounts
                         of $10,000,000 and integral multiples of
                         $1,000,000 in excess thereof. All Advances (other
                         than Competitive Bid Advances) shall be made by
                         the Lenders ratably in proportion to their
                         respective Commitments. Other than Competitive Bid
                         Advances, borrowings will be available on same day
                         notice for Base Rate Advances and 3 business days
                         notice for Eurocurrency Rate Advances.

AVAILABILITY:            From the Closing Date and prior to the Commitment
                         Termination Date, the Borrowers may, subject to
                         the terms of the Backstop Facility, borrow, repay
                         and reborrow.

COMPETITIVE BID
OPTION:                  The Borrowers may request the Agent to solicit
                         competitive bids from the Lenders (individually a
                         "Bidder" and collectively the "Bidders") for
                         Advances in U.S. Dollars or Foreign Currencies
                         (meaning any currency other than U.S. Dollars
                         which is freely transferable and convertible into
                         U.S. Dollars), for requested maturities of 5 days
                         or more. Each Bidder will bid at its discretion.
                         Each Borrower's notice requesting such bids will
                         be given to the Agent at least 1 business day
                         prior to the proposed Advance date for fixed rate
                         U.S. Dollar based bids, at least 4 business days
                         prior to the proposed Advance date for
                         Eurocurrency Rate U.S. Dollar based bids, at least
                         3 business days prior to the proposed Advance date
                         for fixed or local rate based bids in Foreign
                         Currencies and at least 5 business days prior to
                         the proposed Advance date for Eurocurrency Rate
                         based bids in Foreign Currencies, and will specify
                         the proposed date of Advance, amount, currency and
                         maturity date of the proposed Advance, interest
                         payment schedule, the interest rate basis to be
                         used by the Bidders in bidding, the location of
                         such Borrower's account to which funds are to be
                         advanced, and such other terms as such Borrower
                         may specify. The Agent will advise the Bidders of
                         the terms of the applicable Borrower's notice, and
                         such Bidders as elect may submit bids, which the
                         Agent shall provide to such Borrower.

                         The Borrower giving the notice may accept one or
                         more bids, provided that the aggregate outstanding
                         Advances of all Lenders on the date of, and after
                         giving effect to, any Competitive Bid Advance
                         shall not exceed the aggregate Commitments at such
                         time. Bids will be accepted in order of the lowest
                         to the highest rates ("Bid Rates"). The Borrowers
                         may not accept bids in excess of the requested bid
                         amount for any maturity. If two or more Bidders
                         bid at the same Bid Rate, the amount to be
                         borrowed at such Bid Rate will be allocated among
                         such Bidders in proportion to the amount which
                         each Bidder bid at such Bid Rate.

                         Each Borrowing under the Competitive Bid Option
                         shall be in an amount of not less than $10,000,000
                         and integral multiples of $1,000,000 in excess
                         thereof. While any such Borrowing is outstanding,
                         it will be deemed usage of the Backstop Facility
                         for the purposes of availability and the
                         Commitment of each Lender (whether or not a
                         Bidder) shall be reduced and deemed used for all
                         purposes by its pro rata share (based on its
                         respective Commitment) of an amount equal to the
                         outstanding amount of such Borrowing. However,
                         each Lender's Advance made under the Competitive
                         Bid Option shall not reduce such Lender's
                         obligation to lend its pro rata share of the
                         remaining undrawn Commitment.

COMPETITIVE BID
ADMINISTRATIVE FEE:      As agreed between Citibank and the Company.

ANNUAL AGENCY FEE:       As agreed between Citibank and the Company.

REPAYMENT:               The Borrowers will repay (i) each Advance (other
                         than a Competitive Bid Advance) no later than on
                         the Commitment Termination Date, subject to the
                         Term Loan Conversion Option and (ii) each
                         Competitive Bid Advance at the maturity date
                         specified in the applicable Borrower's notice
                         requesting such Competitive Bid Advance.

OPTIONAL
PREPAYMENT:              Advances (other than Competitive Bid Advances) may
                         be prepaid without penalty, with notice not later
                         than 11:00 A.M. for Base Rate Advances, and with
                         two business days notice for Eurocurrency Rate
                         Advances, in minimum amounts of $10,000,000 and
                         increments of $1,000,000 in excess thereof. The
                         Borrowers will bear all costs related to the
                         prepayment of a Eurocurrency Rate Advance prior to
                         the last day of its Interest Period. Competitive
                         Bid Advances may not be prepaid unless the
                         invitation for Competitive Bid Advances specifies
                         the right to prepay, and in such case the
                         Borrowers will reimburse the Lender(s) for any
                         funding losses.

MANDATORY PREPAYMENT
AND COMMITMENT
TERMINATION:             The Commitments shall be terminated and the
                         Borrowers shall repay all outstanding Advances on
                         the closing date of the $7,000,000,000 364-Day
                         Credit Facility.

LOAN
DOCUMENTATION:           The commitments will be subject to preparation,
                         execution and delivery of mutually acceptable loan
                         documentation which will contain conditions
                         precedent, representations and warranties,
                         covenants, events of default and other provisions
                         customary for facilities of this nature,
                         including, but not limited to, those noted below.
                         Except as otherwise specifically stated in this
                         term sheet, terms and conditions set forth in
                         documentation for the Backstop Facility shall be
                         substantially the same as such terms and
                         conditions set forth in the Company's existing
                         $750 million five-year credit facility.

DOLLAR EQUIVALENT
VALUE LIMITATION
FOR ALL ADVANCES:        If at any time the dollar equivalent value of all
                         Advances exceeds 103% of the Facility Amount, the
                         Borrowers shall promptly make a mandatory
                         prepayment to reduce the dollar equivalent value
                         of all Advances to 100% of the Facility Amount.

DOLLAR EQUIVALENT
VALUE LIMITATION FOR
ADVANCES IN MAJOR
CURRENCIES:              If at any time the dollar equivalent value of all
                         Advances in Major and Alternate Currencies exceeds
                         110% of $200,000,000 (the "Major Currency
                         Sublimit"), the Borrowers shall make a mandatory
                         prepayment at the end of the respective Interest
                         Periods for such Advances to reduce the dollar
                         equivalent value of all Advances in Major
                         Currencies to 100% of the Major Currency Sublimit.

CONDITIONS
PRECEDENT TO
CLOSING:                 Customary for facilities of this nature,
                         including, but not limited to:

                         (1)  The Notes, if requested.

                         (2)  Board resolutions.

                         (3)  Incumbency certificate.

                         (4)  Favorable legal opinion from counsel for the
                              Company.

                         (5)  Favorable legal opinion from counsel for the
                              Agent.

                         (6)  Accuracy of representations and warranties.

CONDITIONS
PRECEDENT TO ALL
ADVANCES:                Customary for facilities of this nature,
                         including, but not limited to:

                         (1)  All representations and warranties are true
                              and correct in all material respects on and
                              as of the date of the Borrowing, before and
                              after giving effect to such Borrowing and to
                              the application of the proceeds therefrom, as
                              though made on and as of such date; provided
                              that the representation as to no material
                              adverse change shall be made only at Closing
                              and Renewal of Commitments.

                         (2)  No Event of Default or event which, with the
                              giving of notice or passage of time or both,
                              would be an Event of Default, has occurred
                              and is continuing, or would result from such
                              Borrowing.

CONDITIONS PRECEDENT TO
INITIAL ADVANCE TO EACH
BORROWER THAT IS A
DESIGNATED SUBSIDIARY:   Customary for facilities of this nature,
                         including, but not limited to:

                         (1)  Such Borrower's Note if requested;

                         (2)  Representations by the Company that such
                              Borrower has received all governmental
                              authorizations, consents, approvals and
                              licenses under applicable laws and
                              regulations for such Borrower to execute and
                              deliver the Credit Agreement and to perform
                              its obligations thereunder;

                         (3)  Board resolutions of such Borrower;

                         (4)  Incumbency Certificate of such Borrower;

                         (5)  Designation Letter;

                         (6)  Accuracy of representations and warranties of
                              such Borrower; 

                         (7)  Favorable legal opinion from counsel for such
                              Borrower.

ADDITIONAL CONDITION
PRECEDENT TO COMPETITIVE
BID ADVANCES:            The information provided by the applicable
                         Borrower does not contain an untrue statement or
                         omit to state any material fact necessary to make
                         the statements contained therein, in light of the
                         circumstances under which they are made, not
                         misleading.

REPRESENTATIONS
AND WARRANTIES:          Customary for facilities of this nature,
                         including, but not limited to:

                         (1)  Confirmation of corporate status and
                              authority;

                         (2)  Execution, delivery, and performance of loan
                              documents do not violate law or existing
                              agreements;

                         (3)  No government or regulatory approvals
                              required;

                         (4)  No litigation currently or threatened which
                              is likely to be determined adversely so as to
                              affect materially the ability of the Company
                              to pay its debts, including the Advances, or
                              which would affect the legality, validity and
                              enforceability of the loan documents;

                         (5)  No material adverse change in financial
                              condition or results of operations or
                              prospects since December 31, 1997 for the
                              Company and its Consolidated Subsidiaries
                              taken as a whole;

                         (6)  Accuracy of information, financial
                              statements;

                         (7)  Material compliance with laws and
                              regulations, including ERISA and all
                              applicable environmental laws and
                              regulations;

                         (8)  Legality, validity, binding effect and
                              enforceability of the loan documents;

                         (9)  Not an investment company or public utility
                              holding company.

FINANCIAL
COVENANTS:               (1)  Minimum Net Worth greater than or equal to
                              $3,100,000,000;

                         (2)  Limitation on Domestic Subsidiary
                              Indebtedness.

COVENANTS:               Customary for facilities of this nature,
                         including, but not limited to:

                         (1)  Preservation of corporate existence;

                         (2)  Material compliance with laws (including
                              ERISA and applicable environmental laws);

                         (3)  Payment of taxes;

                         (4)  Payment of material obligations;

                         (5)  Visitation rights;

                         (6)  Maintenance of books and records;

                         (7)  Maintenance of properties;

                         (8)  Maintenance of insurance;

                         (9)  Negative pledge and limitations on liens and
                              secured debt with certain exceptions
                              essentially in conformity to Section 1005 of
                              the 1985 Indenture (which will not be
                              incorporated by reference, but will be
                              directly inserted);

                         (10) Certain restrictions on change of business,
                              consolidations, mergers, sale of assets;

                         (11) Certain reporting requirements, including
                              financial and ERISA;

                         (12) Use of proceeds;

                         (13) Change of control.

EVENTS OF DEFAULT:       Customary for facilities of this nature,
                         including, but not limited to:

                         (1)  Failure to pay principal when due and
                              interest, Facility Fee and Utilization Fee
                              within three business days of when due;

                         (2)  Representations or warranties materially
                              incorrect;

                         (3)  Failure to comply with covenants (with notice
                              and cure periods as applicable);

                         (4)  Cross-default to payment defaults on
                              principal aggregating $100,000,000, excluding
                              defaults on indebtedness to any institution
                              to the extent the Company or a Subsidiary has
                              deposits with such institution sufficient to
                              repay such indebtedness, or to default or
                              event if the effect is to accelerate or
                              permit acceleration of any such debt. This
                              cross default provision shall not apply to
                              debt of any subsidiary or affiliate of the
                              Company located in China, India, Commonwealth
                              of Independent States or Turkey provided that
                              such debt is not guaranteed or supported in
                              any legally enforceable manner by any
                              Borrower or by any subsidiary or affiliate of
                              the Company located outside of these
                              countries, and such default is due to the
                              direct or indirect action of any government
                              entity or agency of these countries and
                              provided further each subsidiary to which
                              this exception applies shall not have assets
                              of more than $80 million individually nor
                              collectively $300 million measured as of the
                              most recent calendar quarter end;

                         (5)  Unsatisfied judgment or order in excess of
                              $100,000,000 individually or in the
                              aggregate. A carve-out will be provided
                              similar to that contained in the second
                              sentence of item (4) immediately above;

                         (6)  Bankruptcy/insolvency;

                         (7)  ERISA Event and aggregate Plan
                              Insufficiencies exceed $100,000,000, or Plan
                              reorganization or termination resulting in an
                              increase in annual contributions exceeding
                              $100,000,000.

ECONOMIC MONETARY
UNION:                   Appropriate language will be incorporated into the
                         Backstop Facility to address certain issues that
                         will be raised by the introduction of the Euro on
                         January 1, 1999 and the removal from circulation
                         of the various national currency denominations on
                         and after January 1, 2002.

OTHER:                   Loan documentation will include:

                         (1)  Indemnification of Agent and Lenders and
                              their respective affiliates, officers,
                              directors, employees, agents and advisors for
                              any liabilities and expenses arising out of
                              the Backstop Facility or the use of proceeds.

                         (2)  Normal agency language.

                         (3)  Majority Lenders defined as those holding 51%
                              of outstanding Advances (excluding
                              Competitive Bid Advances) or, if none,
                              Commitments. The consent of all the Lenders
                              will be required to increase the size of the
                              Backstop Facility, to extend the maturity or
                              to decrease interest rates or fees.

                         (4)  The Company will have the right to replace
                              any Lender through assignment or the addition
                              of a new Lender provided that no Event of
                              Default has occurred and is continuing and no
                              more than 3 Lenders in any calendar year may
                              be replaced.

ASSIGNMENTS AND
PARTICIPATIONS:          Each Lender will have the right to assign to one
                         or more Eligible Assignees all or a portion of its
                         rights and obligations under the loan documents
                         with the consent of the Company (not to be
                         unreasonably withheld). Minimum aggregate
                         assignment level of $10,000,000 and increments of
                         $1,000,000 in excess thereof. The parties to the
                         assignment (other than the Company) shall pay to
                         the Agent an administrative fee of $3,500 per
                         assignment.

                         Each Lender will also have the right, without the
                         consent of the Company or the Agent, to assign (i)
                         as security, all or part of its rights under the
                         loan documents to any Federal Reserve Bank and
                         (ii) with notice to the Company and the Agent, all
                         or part of its rights or obligations under the
                         loan documents to any of its affiliates.

                         Each Lender will have the right to sell
                         participations in its rights and obligations under
                         the loan documents, subject to customary
                         restrictions on the participants' voting rights.
                         Each Lender selling a participation shall notify
                         the Company within 30 days of such sale.

YIELD PROTECTION,
TAXES, AND
OTHER DEDUCTIONS:       (1)   The loan documents will contain yield protection
                              provisions, customary for facilities of this
                              nature, protecting the Lenders in the event of
                              unavailability of funding, funding losses, 
                              reserve and capital adequacy requirements.

                         (2)  All payments to be free and clear of any
                              present or future taxes, withholdings or
                              other deductions whatsoever (other than
                              income taxes in the jurisdiction of the
                              Lender's applicable lending office).

                              The Company will have the right to replace
                              any Lender which requests reimbursements for
                              amounts owing under (1) and (2) above
                              provided that (i) no Event of Default, or
                              event which with the giving of notice or
                              lapse of time or both would be an Event of
                              Default, has occurred and is continuing, (ii)
                              the Company has satisfied all of its
                              obligations under the Facility relating to
                              such Lender, and (iii) any replacement is
                              acceptable to the Agent and the Company will
                              have paid the Agent a $3,500 administrative
                              fee if such replacement Lender is not an
                              existing Lender.

GOVERNING LAW:           State of New York.

COUNSEL TO
THE AGENT:               Shearman & Sterling

EXPENSES:                The Company shall reimburse each Arranger and
                         Citibank for all agreed out-of-pocket expenses
                         incurred by them in the negotiation, syndication
                         and execution of the Facility. Such expenses shall
                         be reimbursed by the Company upon presentation of
                         a statement of account, regardless of whether the
                         transaction contemplated is actually completed or
                         the loan documents are signed.

                             ALLIEDSIGNAL INC.

               $900,000,000 364-DAY REVOLVING CREDIT FACILITY
                                PRICING GRID

==================================================================================================================
                    LEVEL 1         LEVEL 2          LEVEL 3         LEVEL 4         LEVEL 5          LEVEL 6
- ------------------------------------------------------------------------------------------------------------------
                                                                                
BASIS FOR       LT Senior       LT Senior        LT Senior       LT Senior       LT Senior        LT Senior
PRICING         Unsecured Debt  Unsecured Debt   Unsecured Debt  Unsecured Debt  Unsecured Debt   Unsecured Debt
                Rated At Least  Rated Less Than  Rated Less      Rated Less      Rated Less Than  Rated Less
                A By Standard   Level 1 But At   Than Level 2    Than Level 3    Level 4 But At   Than Level 5.
                & Poor's Or A2  Least A- By      But At Least    But At Least    Least BBB- By
                By Moody's.     Standard &       BBB+ By         BBB By          Standard &
                                Poor's Or A3 By  Standard &      Standard &      Poor's Or BAA3
                                Moody's.         Poor's Or BAA1  Poor's Or BAA2  By Moody's.
                                                 By Moody's.     By Moody's.

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

FACILITY FEE        5.5 bps         7.0 bps          8.5 bps         9.5 bps         12.0 bps          20.0 bps
(FN1)

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

APPLICABLE         17.0 bps         20.5 bps        26.5 bps        30.5 bps         40.5 bps        50.0 bps
MARGIN

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

DRAWN COST      LIBOR+22.5 bps  LIBOR+27.5 bps   LIBOR+35.0 bps  LIBOR+40.0 bps  LIBOR+52.5 bps   LIBOR+70.0 bps
(FN2)

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

UTILIZATION FEE
(USAGE (greater     0.0 bps         2.5 bps          2.5 bps         5.0 bps         5.0 bps          5.0 bps
than or equal
to) 33 1/3 AND
(less than)
66 2/3%)

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

UTILIZATION FEE
(USAGE (greater     2.5 bps         5.0 bps          5.0 bps        10.0 bps         10.0 bps        17.5 bps
than or equal
to) 66 2/3%)

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

FULLY DRAWN     LIBOR+25.0 bps   LIBOR+32.5 bps  LIBOR+40.0 bps  LIBOR+50.0 bps   LIBOR+62.5 bps  LIBOR+87.5 bps
COST(FN3)

==================================================================================================================

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

(1)     Paid quarterly in arrears on each bank's commitment irrespective of usage.
(2)     Facility Fee plus Applicable Margin.
(3)     Drawn Cost plus Utilization Fee.
bps = basis points per annum

                             ALLIEDSIGNAL INC.

                   $900,000,000 ONE YEAR TERM-OUT OPTION
                                PRICING GRID

==================================================================================================================
                    LEVEL 1         LEVEL 2          LEVEL 3         LEVEL 4         LEVEL 5          LEVEL 6
- ------------------------------------------------------------------------------------------------------------------
                                                                                 
BASIS FOR        LT Senior       LT Senior        LT Senior       LT Senior       LT Senior        LT Senior
PRICING          Unsecured Debt  Unsecured Debt   Unsecured Debt  Unsecured Debt  Unsecured Debt   Unsecured Debt
                 Rated At Least  Rated Less Than  Rated Less      Rated Less      Rated Less Than  Rated Less
                 A By Standard   Level 1 But At   Than Level 2    Than Level 3    Level 4 But At   Than Level 5.
                 & Poor's Or A2  Least A- By      But At Least    But At Least    Least BBB-By
                 By Moody's.     Standard &       BBB+ By         BBB By          Standard &
                                 Poor's Or A3 By  Standard &      Standard &      Poor's Or BAA3
                                 Moody's.         Poor's Or BAA1  Poor's Or BAA2  By Moody's.
                                                  By Moody's.     By Moody's.

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APPLICABLE          22.5 bps         27.5 bps        35.0 bps        40.0 bps         52.5 bps        70.0 bps
MARGIN

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UTILIZATION FEE
(USAGE               0.0 bps         2.5 bps          2.5 bps         5.0 bps         5.0 bps          5.0 bps
(greater than
or equal to)
33 1/3% AND 
(less than)
 66 2/3%)

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UTILIZATION FEE
(USAGE 
(greater than
or equal to)
66 2/3%)             2.5 bps         5.0 bps          5.0 bps        10.0 bps         10.0 bps        17.5 bps

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FULLY DRAWN      LIBOR+25.0 bps   LIBOR+32.5 bps  LIBOR+40.0 bps  LIBOR+50.0 bps   LIBOR+62.5 bps  LIBOR+87.5 bps
COST(FN1)

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(1)     Applicable Margin plus Utilization Fee.
bps = basis points per annum