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 Earliest Event Reported:  October 6, 1995


                  Jefferson-Pilot Corporation             
    (Exact name of registrant as specified in its charter)



       North Carolina            1-5955          56-0896180   
(State or other jurisdiction   (Commission    (I.R.S. Employer
     of incorporation)         File Number)  Identification No.)




 100 North Greene Street, Greensboro, North Carolina     27401   
       (Address of principal executive offices)        (Zip Code)




                         (910) 691-3691                          

       (Registrant's telephone number, including area code)
<PAGE>
Item 2.  Acquisition or Disposition of Assets
On October 6, 1995, the registrant acquired Alexander Hamilton Life
Insurance Company of America ("Alexander Hamilton") and certain of its
affiliates from Household Group, Inc. ("HGI"), a wholly owned subsidiary
of Household International, Inc. ("HI"), under a Stock Purchase Agreement
dated August 9, 1995.  The acquisition was completed through the merger of
Alexander Hamilton into a wholly owned Michigan-domiciled stock life
insurance subsidiary of the registrant ("Surviving Company") which
thereupon was renamed Alexander Hamilton Life Insurance Company of
America.  First Alexander Hamilton Life Insurance Company ("FAH"), a New
York stock life insurance company, was acquired from HGI on October 13,
1995.  Pursuant to the Stock Purchase Agreement, the acquisitions were
effective as of October 1, 1995.
The acquisitions included substantially all of the life and single premium
deferred annuity business of Alexander Hamilton and FAH.
Credit life and accident and health insurance ("Affiliated Business")
written by Alexander Hamilton and FAH was 100% reinsured back to
affiliates of HI through coinsurance agreements and related trust
agreements for the assets retained for the Affiliated Business, with HI
providing payment and performance guarantees.
The Periodic Payment Annuity business ("PPA Business") of Alexander
Hamilton, principally structured settlement and lottery business, also was
100% reinsured back to affiliates of HI through coinsurance agreements and
related trust agreements for the assets retained for the PPA Business,
with HI providing payment, performance and capital maintenance guarantees.
The Corporate Owned Life Insurance business ("COLI Business") also was
100% reinsured back to affiliates of HI through a coinsurance agreement
and related trust agreement for the assets retained for the COLI Business,
with HI providing payment, performance and capital maintenance guarantees. 
The trusts backing the PPA and COLI Businesses are subject to annual audit
requirements for solvency and capital adequacy.
The purchase price was $575 million, subject to post-closing adjustment in
accordance with the Stock Purchase Agreement.  Prior to the closing,
Alexander Hamilton paid a dividend equal to its net income from January 1,
1995 but subject to the requirement that Alexander Hamilton have, on the
closing date financial statements to be prepared and delivered by the
Surviving Company (September 30, 1995, which will form the basis for any
post-closing adjustment), a minimum statutory net worth as agreed to by
the parties.
The merger consideration was paid as follows:  $475 million plus accrued
interest in cash, and $50 million in newly issued floating rate preferred
stock of the Surviving Company.  In addition, an outstanding surplus note
of Alexander Hamilton (which became an obligation of the Surviving Company
pursuant to the merger) was acquired from HI for $50 million plus accrued
interest.
The acquisition was financed through internal resources and $315 million
of borrowings under a new Credit Agreement entered into on October 5, 1995
with a group of banks and NationsBank of Georgia, N.A. as Agent.  The
registrant expects to repay a portion of that bank debt from the proceeds
of corporate financing activities.
<PAGE>
Further Reporting
The Registrant will file an amendment to this Form 8-K within 60 days to
provide the required pro forma financial information.
Item 7.   Financial Statements, Pro Forma Financial Information and
          Exhibits
     (a)  Financial statements of business acquired.
          (i)  Report of independent public accountants, audited
          combined balance sheets as of December 31, 1993 and 1994,
          audited combined statements of income, companies equity and
          cash flows for the years ended December 31, 1992 - 94, and
          notes to combined financial statements, for Alexander Hamilton
          Life Insurance Company of America and the acquired
          subsidiaries.
          (ii) Unaudited combined balance sheet at June 30, 1995 and
          December 31, 1994, unaudited combined condensed statements of
          income and cash flows for the six months ended June 30, 1995
          and 1994, and unaudited note to condensed financial
          statements, for Alexander Hamilton Life Insurance Company of
          America and the acquired subsidiaries.
     (b)  Pro forma financial information.
          To be supplied by amendment.

     (c)  Exhibits

          (i) Stock Purchase Agreement by and among Household Group,
          Inc., Household International, Inc., Alexander Hamilton Life
          Insurance Company of America and Jefferson-Pilot Corporation
          dated August 9, 1995.  (Confidential treatment requested with
          respect to certain portions thereof.)  (Exhibits (other than
          Exhibits B-1 to B-4) set forth in the Stock Purchase Agreement
          have been omitted and will be provided to the Securities and
          Exchange Commission upon request.)
<PAGE>      
    (ii) Credit Agreement dated October 5, 1995 among the
          registrant and the banks named therein, and NationsBank of
          Georgia, N.A. as Agent, is not being filed because the total
          amount of borrowings available thereunder does not exceed 10%
          of total consolidated assets.  The registrant agrees to
          furnish a copy of the Credit Agreement to the Commission upon
          request.



                           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 thereunto duly authorized.

                              JEFFERSON-PILOT CORPORATION



                              By:     /s/Robert A. Reed          


                              (name)  Robert A. Reed             


                              (title) Vice President             

Dated:  October 18, 1995
<PAGE>
October 18, 1995

VIA EDGAR
Securities and Exchange Commission
ATTENTION:  Filing Desk, Stop 1-4
450 Fifth Street N.W.
Washington, D.C.  20549
Ladies and Gentlemen:
SUBJECT:  Jefferson-Pilot Corporation
          File No. 1-5955
Enclosed herewith is a Current Report on Form 8-K for Jefferson-Pilot
Corporation dated October 18, 1995.
Please confirm receipt of this filing by notifying the CompuServe mailbox
maintained by Jefferson-Pilot.
Very truly yours,
 /s/ Robert A. Reed 
Robert A. Reed
Vice President, Secretary
  and Associate General Counsel
Jefferson-Pilot Corporation

<PAGE>
Exhibits                                                     Pages
Report of independent public accountants, audited 
combined balance sheets as of December 31, 1993 and
1994, audited combined statements of income, companies
equity and cash flows for the years ended December 31, 
1992 - 94, and notes to combined financial statements,
for Alexander Hamilton Life Insurance Company of America 
and the acquired subsidiaries.

Unaudited combined balance sheet at June 30, 1995 and 
December 31, 1994, unaudited combined condensed statements 
of income and cash flows for the six months ended June 30, 
1995 and 1994, and unaudited note to condensed financial 
statements, for Alexander Hamilton Life Insurance Company 
of America and the acquired subsidiaries.


Stock Purchase Agreement by and among Household Group, 
Inc., Household International, Inc., Alexander Hamilton Life 
Insurance Company of America and Jefferson-Pilot Corporation 
dated August 9, 1995.  (Confidential treatment requested with 
respect to certain portions thereof.)  (Exhibits (other than 
Exhibits B-1 to B-4) set forth in the Stock Purchase Agreement 
have been omitted and will be provided to the Securities and 
Exchange Commission upon request.)













<PAGE>
Alexander Hamilton Life Insurance Company of America,
First Alexander Hamilton Life Insurance Company, and
Alexander Hamilton Capital Management, Inc.
Combined Financial Statements
as of December 31, 1994, 1993, and 1992
Together With Auditors' Report
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Board of Directors
and Stockholders of
Alexander Hamilton Life Insurance Company of America, First Alexander
Hamilton Life Insurance Company, and Alexander Hamilton Capital
Management, Inc.:
We have audited the accompanying combined balance sheets of Alexander
Hamilton Life Insurance Company of America (a Michigan corporation), FIRST
alexander hamilton life insurance company (a New York corporation), and
alexander hamilton capital management, INC. (a Michigan corporation) as of
December 31, 1994 and 1993 and the related combined statements of income,
combined companies equity, and cash flows for each of the three years in
the period ended December 31, 1994.  These financial statements are the
responsibility of the Companies' management.  Our responsibility is to
express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are
free of material misstatement.  An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements.  An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation.  We believe that our audits
provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the combined financial position of Alexander
Hamilton Life Insurance Company of America, First Alexander Hamilton Life
Insurance Company, and Alexander Hamilton Capital Management, Inc. as of
December 31, 1994 and 1993 and the combined results of their operations
and their cash flows for each of the three years in the period ended
December 31, 1994 in conformity with generally accepted accounting
principles.

As disclosed in Note 2 to the combined financial statements named above,
the Companies changed their method of accounting for investments during
1994.  As disclosed in Note 11, the Companies changed their method of
accounting for postretirement benefits other than pensions in 1993.



Detroit, Michigan
January 30, 1995 (except with respect to
the matter discussed in Note 1, as to
which the date is September 22, 1995)
<PAGE>
<TABLE> 
ALEXANDER HAMILTON LIFE INSURANCE COMPANY OF AMERICA,

FIRST ALEXANDER HAMILTON LIFE INSURANCE COMPANY, AND

ALEXANDER HAMILTON CAPITAL MANAGEMENT, INC.


COMBINED BALANCE SHEETS

December 31, 1994 and 1993

(Dollar Amounts in Thousands)


<CAPTION>                                                          
                       ASSETS                               1994        1993  
<S>                                                   <C>          <C>                                                       
CASH AND INVESTMENTS:
  Cash and cash equivalents                             $   10,380  $   13,821
  Debt securities available for sale, at fair value      3,515,628          - 
  Debt securities held to maturity, at amortized cost    2,737,720          -
  Debt Securities at amortized costs (Note 3)                  -     5,703,837
  Equity securities available for sale, at market value     53,289          - 
  Equity securities principally at market value                -        75,433
  Mortgage loans on real estate                            161,883     222,347
  Policy loans                                             544,198     360,416
  Real estate,less accumulated depreciation of $16,081
    And $14,858 in 1994 and 1993                            81,153     100,766
  Other investments                                          1,722       1,722
     Total cash and investments                          7,105,973   6,478,342

ACCRUED INVESTMENT INCOME                                  103,929      95,458

ACCOUNTS RECEIVABLE AND AGENTS' BALANCES                    57,607      25,159

DUE FROM REINSURERS                                         82,165      29,847

PROPERTY AND EQUIPMENT less accumulated depreciation of
$22,263 in 1994 and $19,051 in 1993                         20,088      19,397

DEFERRED POLICY ACQUISITION COSTS, net of amortization     618,652     470,230

DEFERRED INCOME TAX ASSETS (note 10)                        68,994          - 

OTHER ASSETS                                                 9,330       6,353

     TOTAL ASSETS                                       $8,066,738  $7,124,786




</TABLE>
The accompanying notes are an integral part of these combined statements.






<PAGE>
<TABLE>

     ALEXANDER HAMILTON LIFE INSURANCE COMPANY OF AMERICA,
                                
      FIRST ALEXANDER HAMILTON LIFE INSURANCE COMPANY, AND
                                
          ALEXANDER HAMILTON CAPITAL MANAGEMENT, INC.
                                
                                
                    COMBINED BALANCE SHEETS
                                
                   December 31, 1994 and 1993
                                
                 (Dollar Amounts in Thousands)
                                
<CAPTION>                                
LIABILITIES AND COMBINED COMPANIES EQUITY                 1994       1993  
                                                                  
<S>                                                   <C>          <C>                                                   
POLICY LIABILITIES:
  Future policy benefits                               $7,087,065  $6,257,264
  Dividend accumulations and other policyholder funds
    on deposit                                              2,021       6,830
  Policy and contract claims                               36,439      41,105
  Unearned premium reserves                                 3,502       3,899
     Total policy liabilities                           7,129,027   6,309,098

INCOME TAXES PAYABLE                                       20,008      11,360

DEFERRED INCOME TAX LIABILITIES (note 10)                      -        2,980

ACCOUNTS PAYABLE AND ACCRUED EXPENSES                     157,620     144,142

PAYABLE TO AFFILIATE                                       67,768          - 

NOTE PAYABLE TO PARENT                                     50,000          - 

     Total liabilities                                  7,424,423   6,467,580


COMBINED COMPANIES EQUITY:
  Combined companies equity                               733,076     661,471
  Net unrealized gain (loss) on securities available 
    for sale, net of deferred policy acquisition costs
    And deferred income taxes of $129,586 and $45,581
    Respectively                                           (81,835)         -  
  Net unrealized gain on equity securities, less
    Deferred income taxes of $1,930                            -        3,540
  Net unrealized losses or foreign currency
    translations,net of income taxes of $339 and
    $464 in 1994 and 1993, respectively                    (8,926)     (7,805)

     Total combined companies equity                      642,315     657,206
     TOTAL LIABILITIES AND COMBINED COMPANIES EQUITY   $8,066,738  $7,124,786


</TABLE>
The accompanying note is an integral part of these combined statements.
<PAGE>
<TABLE>     
ALEXANDER HAMILTON LIFE INSURANCE COMPANY OF AMERICA,
                                
      FIRST ALEXANDER HAMILTON LIFE INSURANCE COMPANY, AND
                                
          ALEXANDER HAMILTON CAPITAL MANAGEMENT, INC.
                                
                                
                 COMBINED STATEMENTS OF INCOME
                                
       For the Years Ended December 31, 1994, 1993, 1992
                                
                 (Dollar Amounts in Thousands)
                                
                                
                                                           
<CAPTION>                                                          
                                             1994          1993        1992   
<S>                                       <C>          <C>         <C>           $  56,820
  Accident and health premiums                24,167       32,577      31,108
  Contract revenue                           132,367      116,695     102,669
  Total premiums and other considerations    159,957      200,676     190,597
  Net investment income (note 3)              96,573      100,181      91,124
  Realized investment gains (losses)          21,072       63,169      20,590
    Total revenues                           277,602      364,026     302,311

BENEFITS AND EXPENSES:
  Life benefits                               64,745       74,092      71,078
  Accident and health benefits                10,923       21,358      18,358
  (Decrease) increase in reserves            (43,701)         266      (2,719)
  Other policyholder benefits                  4,230        8,283      10,515
     Total benefits                           36,197      103,999      97,232
  Insurance commissions                       56,547       77,423      34,248
  General and administrative                  55,782       50,904      49,403
  Insurance taxes, licenses, and fees         17,834       10,954      16,020
  Interest expense                             1,230           -         -   
     Total expenses                          131,393      139,281      99,671

INCOME BEFORE INCOME TAXES                   110,012      120,746     105,408
INCOME TAXES(note 10)                         38,407       38,388      37,056

NET INCOME                                 $ 71,605      $ 82,358    $ 68,352



</TABLE>
The accompanying notes are an integral part of these combined statements.
<PAGE>



<TABLE>
     ALEXANDER HAMILTON LIFE INSURANCE COMPANY OF AMERICA,
                                
      FIRST ALEXANDER HAMILTON LIFE INSURANCE COMPANY, AND
                                
          ALEXANDER HAMILTON CAPITAL MANAGEMENT, INC.
                                
                                
               COMBINED STATEMENTS OF CASH FLOWS
                                
     FOR THE YEARS ENDED DECEMBER 31, 1994, 1993, AND 1992
                                
                 (Dollar Amounts in Thousands)
<CAPTION>                                                                               
                                               1994         1993        1992  
<S>                                         <C>       <C>         <C>     
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income                                   $ 71,605  $   82,358  $   68,352
Adjustments to reconcile net 
Income to net cash provided
by operating activities:
  Policy liabilities                          819,929    863,081     814,974
  Deferred policy acquisition costs          (102,034)  (118,404)   (128,005)
  Depreciation and amortization                89,937    105,301      77,844
  Deferred income taxes (benefit)             (24,588)   (22,957)     (8,038)
  Amounts receivable and other assets         (96,214)   (13,345)    (28,066)
  Accounts payable and accrued expenses        22,126     73,030     (28,150)
  Realized investment (gains) losses          (21,072)   (63,169)    (20,590)
    Total adjustments                         688,084    823,537     679,969
    Net cash provided by operating 
    Activities                                759,689    905,895     748,321
CASH FLOWS FROM INVESTING ACTIVITIES:
purchases of investment securities         (2,657,373) (3,257,314) (2,570,773)
proceeds from sales and maturities  
Of investment securities                    1,881,751   2,318,920   1,758,836
Purchases of mortgage loans and 
real estate                                   (19,770)   (10,321)    (28,180)
Proceeds from sales of real estate             21,985     15,906       7,362
Proceeds from payments on mortgage 
  principle                                    80,234    138,997     177,125
Policy loans, net                            (183,782)  (116,249)    (95,943)
Additions to property, plant 
and equipment                                 ( 3,943)    (3,546)     (1,522)
 Net cash used in investing activities       (880,898)  (913,607)   (753,095)
CASH FLOWS FROM FINANCING ACTIVITIES:
Capital contribution recieved from
 parent                                            -      17,000           -   
            
Increase (decrease) in note payable       
And payable to affiliate                      117,768         -           - 
Net cash provided by (used for) 
financing activities                          117,768     17,000          -  
 Net increase (decrease) in cash
 and cash equivalents                          (3,441)     9,288      (4,774)
CASH AND CASH EQUIVALENTS, beginning 
of year                                        13,821      4,533       9,307

CASH AND CASH EQUIVALENTS, end of year      $  10,380 $   13,821  $    4,533

Supplemental Cash Flow Information:
Cash paid for income taxes                  $ 56,130   $ 51,055   $   55,246

</TABLE>
The accompanying note is an integral part of these combined statements.
<PAGE>

<TABLE>
     ALEXANDER HAMILTON LIFE INSURANCE COMPANY OF AMERICA,
                                
      FIRST ALEXANDER HAMILTON LIFE INSURANCE COMPANY, AND
                                
          ALEXANDER HAMILTON CAPITAL MANAGEMENT, INC.
                                
                                
        COMBINED STATEMENTS OF COMBINED COMPANIES EQUITY
                                
     FOR THE YEARS ENDED DECEMBER 31, 1994, 1993, AND 1992
                                
                 (Dollar Amounts in Thousands)




<CAPTION>
                                           Unrealized
                                             Gains
                                          (Losses) for Net Unrealized  Gains (Losses)   Total
                                Combined    Foreign    Gains (Losses)  on Securities   Combined
                                Companies  Currency      on Equity      Available      Companies
                                 Equity   Translation    Securities       for Sale      Equity  
<S>			       <C>         <C>           <C>            <C>            <C>         
Balance, December 31,1991      $ 493,761     $ 3,754     $ (1,484)       $    -        $496,031 

net Income                        68,352           -            -             -          68,352
Increase (decrease) during Year       -       (8,272)       1,020             -          (7,252)
Balance December 31, 1992        562,113      (4,518)        (464)            -         557,131 

Net Income                        82,358          -            -              -          82,358 
Capital Contribution from parent  17,000          -            -              -          17,000
Increase (decrease) during Year       -       (3,287)       4,004             -             717 
Balance December 31,1993         661,471      (7,805)       3,540             -         657,206 

Change in accounting principle                           
effective January 1,1994(note 2)      -           -        (3,540)        37,111         33,571  
Net Income                        71,605          -            -              -          71,605
Increase (decrease) during Year       -         (1,121)        -        (118,946)      (120,067)
Balance December 31, 1994      $ 733,076       $(8,926)     $  -        $(81,835)      $642,315 

</TABLE>
<PAGE>
                                      
                                      
                                      
                                      
                                      
                                      
            Alexander Hamilton Life Insurance Company of America,
            First alexander hamilton life insurance company, and
                 Alexander Hamilton CAPITAL Management, Inc.
                                      
                                      
                   notes to combined Financial Statements
                                      
                      December 31, 1994, 1993, and 1992
                                      
                        (Dollar Amounts in Thousands)

(1)Basis of Presentation
The accompanying combined historical financial statements include Alexander
Hamilton Life Insurance Company of America("AHLIC"), First Alexander 
Hamilton Life Insurance	Company("FAHL"), and Alexander Hamilton Capital
Management, Inc. ("AHCM") and have been	prepared in accordance with 
generally accepted accounting principles (GAAP).  All material intercompany
accounts and transactions have been eliminated.  These financial statements
have been combined and prepared as a result of the Stock Purchase Agreement
between Group, Inc., Household International, Inc., Alexander Hamilton Life
Insurance Company of America and Jefferson-Pilot Corporation dated August 
9, 1995 and excludes certain AHLIC subsidiaries that have not been acquired.

(2)SIGNIFICANT accounting policies 
   Nature of Operations
AHLIC is a wholly-owned subsidiary of Household Group, Inc., which is 
wholly-owned by	Household Finance Corporation ("Household Finance").  
Household Finance is a subsidiary of Household International, Inc. 
("Household International").  FAHL and AHCM are wholly-owned by 
AHLIC (collectively known as the "Companies") engaged in the life 
insurance business and have a diversified base of policyholders in
the United States and Canada.
AHLIC and FAHL, the insurance subsidiaries, also submit financial 
statements to insurance	industry regulatory authorities.  Those financial
statements are prepared on the basis of statutory accounting practices and 
are significantly different from financial statements prepared in accordance
with generally accepted accounting principles.
A comparison of statutory basis net income and capital and surplus of the 
life insurance subsidiaries to the amounts included in the financial 
statements is presented in Note 8. 

Cash and Cash Equivalents 
   Cash and cash equivalents consist of cash on hand and investments in 
short-term, highly liquid securities which have original maturities of 
three months or less from the date of purchase.

Investments in Debt and Equity Securities
The Companies' investment in debt securities includes notes, bonds, 
collateralized mortgage obligations, and other debt instruments.  
Investments in equity securities include common and preferred stocks.
The Companies' adopted Statement of Financial Accounting Standards No. 
115 ("SFAS No. 115"), "Accounting for Certain Investments in Debt and 
Equity Securities," effective January 1, 1994.  The adoption of SFAS 
No. 115 resulted in an increase in combined companies equity of $33,571.
In accordance with SFAS No. 115, investment securities are classified 
in three separate categories:  trading, available-for-sale, or held-
to-maturity.  Trading investments are bought and held principally for 
the purpose of selling them in the near term and are carried at fair value.
Adjustments to the carrying value of trading investments are included in 
current earnings.  Investments which the companies have the positive 
intent and ability to hold to maturity are classified as held-to-maturity 
and carried at amortized cost.  Investments not classified as trading or
held-to-maturity are classified as available-for-sale.  These investments
are carried at fair value.  Unrealized holding gains and losses on 
available-for-sale investments are recorded as adjustments to equity,
net of income taxes and the related impact on deferred policy 
acquisition costs.  Any decline in the fair value of available-for-sale 
or held-to-maturity investments which is
deemed to be other than temporary is charged against current earnings. 
Cost of	investment securities sold generally is determined using the 
first-in, first-out ("FIFO") method.
At December 31, 1993, marketable equity securities were stated at the 
lower of aggregate cost or market, while debt securities were carried 
at amortized cost. 

Mortgage and Policy Loans
Mortgage loans on real estate are stated at unpaid balances, net of 
allowances for unrecoverable amounts.  Policy loans are stated at 
their unpaid balances. 

Real Estate
Real estate not acquired by foreclosure is stated at cost, less accumulated
depreciation.  Real estate acquired by foreclosure is stated at the lower of
depreciated cost or fair value minus estimated costs to sell.  Real estate 
is depreciated principally by the straight-line method over estimated useful
lives (generally 15 years for real estate acquired by foreclosure and 
ranging from 40 to 45 years for all other). 

Property and Equipment
Property and equipment are stated at cost and are depreciated principally 
by the straight-line method over their estimated useful lives (generally 
ten years). 

Deferred Policy Acquisition Costs
The costs of acquiring new business, including commissions, certain costs 
of underwriting and issuing policies, and certain agency office expenses, 
all of which vary with and are primarily related to the production of new 
business, have been deferred. For traditional life insurance policies, these 
costs are being amortized over the premium paying periods of the related 
contracts using the same assumptions about anticipated premium revenue 
that are used to compute liabilities for future policy benefits.  For 
universal life and annuity products, these costs are amortized at a 
constant rate on the present value of the estimated future gross profits 
to be realized over the terms of the contracts, not to exceed 20 years.
Effective with the adoption of SFAS No. 115 as of January 1, 1994, the 
carrying amount of deferred policy acquisition costs is adjusted for amounts
that would have been recognized if net unrealized holding gains or losses on
debt securities classified as available-for-sale had actually been 
Deferred policy acquisition costs are reviewed for recoverability from 
future income and as such, capitalized costs that are deemed not recoverable
are expensed in the period in which the determination is made.

Recognition of Revenue
Premiums for ordinary life policies are recognized when due.  Premiums for 
credit insurance are recognized over the period at risk in relationship to 
anticipated claims.  Premiums received on single premium life, universal 
life, and annuity policies ("interest-sensitive policies") are considered 
insurance deposits.  Revenues on interest-sensitive policies consist reported
in the periods assessed.

Future Policy Benefits
The liability for future contract benefits on interest-sensitive policies 
is computed in accordance with the retrospective deposit method using 
interest rates which vary with rates credited to policyholders' accounts.  
Liabilities for future policy benefits on other life insurance products 
generally are computed using the net level premium method, based upon 
estimated future investment yields, mortality, and withdrawals appropriate
when the policies were issued.  Mortality and withdrawal assumptions 
principally are based upon the Companies' experiences.

Policy and Contract Claims
Policy and contract claims are accrued based on estimated unpaid 
settlement costs for reported losses and for incurred but not reported 
losses.  These accruals are determined through a combination of historical 
experience and management's judgment with regard to the ultimate 
exposure to the Companies.  These estimates are revised and the effect of
the revisions is charged or credited to income in the period that 
additional data is received.

Income Taxes
Household International and all of its subsidiaries file a consolidated 
federal income tax return.  The Companies adopted Statement of Financial 
Accounting Standards No. 109, "Accounting for Income Taxes" ("SFAS No. 109")
, effective January 1, 1993, which requires that deferred income taxes be 
recorded on the differences between the tax basis of assets and 
liabilities and the amounts reported in the financial statements.  The 
recorded amounts are adjusted to the tax rates expected to apply in the 
periods in which the deferred tax assets and liabilities are expected 
to be realized or settled.  The Company recorded a cumulative catch-up 
due to the adoption of SFAS No. 109, which was not material.

Interest Rate Contracts
The nature and composition of the Companies' assets and 
liabilities and off-balance sheet items expose the Companies to 
interest rate risk.  The Companies enter into a variety of 
interest rate contracts in the management of their interest rate 
exposure.  Interest swaps are the principal vehicle used to manage interest 
rate risk. Interest rate swaps are designed, and effective, as 
synthetic alterations of specific assets or liabilities (or specific 
groups of assets or liabilities) and off-balance sheet items.  The 
interest rate differential to be paid or received on these contracts is
accrued and included in net interest income in the statements of income.
The related accrual is classified as a component of accounts payable 
and accrued expenses on the accompanying balance sheets.
If interest rate contracts are terminated early, the realized gains 
and losses are deferred and amortized over the life of the hedged items 
as adjustments to net interest income in the combined statements of income.
These deferred gains and losses are recorded on the accompanying combined 
balance sheets as adjustments of the carrying amount of the hedged items.

Fair Value of Financial Instruments
The fair value of cash and cash equivalents, debt securities, equity 
securities, mortgage loans on real estate, and policy loans was 
approximately $7,006,000 and $6,740,000 at December 31, 1994 and 1993, 
respectively.  The carrying values of cash and cash equivalents approximate 
fair value because of the short maturity of those instruments.  Debt 
securities' and equity securities' fair values were determined principally
using nationally quoted market prices.  The fair value of certain 
municipal bonds is assumed to be equal to amortized cost where no market 
quotations exist.  The fair values of mortgage and policy loans are 
estimated based on quoted market prices for those or similar investments.
The fair value of debt was approximately $65,267 at December 31, 1994, 
all of which was due to Household International.  The fair value of debt 
is estimated based on the current rates offered for debt having the same 
or similar terms and remaining maturities. 
Foreign Currency Translation
Foreign subsidiary assets and liabilities are located in Canada.  The 
functional currency for each subsidiary is its local currency.  
Foreign subsidiary financial data are translated into U.S. dollars at the 
current exchange rate, and translation adjustments are accumulated as a 
separate component of equity.  Effects of foreign currency translation in 
the combined statements of cash flows are offset against the cumulative 
foreign currency adjustment, except for the impact on cash.  Foreign 
currency transaction gains and losses are included in income as they occur.
(3)Investments
The amortized cost, aggregate fair value, and gross unrealized gains and 
losses on debt and equity securities as of December 31, 1994 are as follows:
<TABLE>
<CAPTION>               
                               Gross        Gross
                              Amortized  Unrealized   Unrealized    Fair
       
                                  Cost          Gains    (Losses)   Value
<S>			       <C>           <C>         <C>         <C>
Available for sale Investments
Government debt securities        $524,656      $ 161      $(14,712) $510,105 
Mortgage backed securities         898,084      4,312       (71,686)  830,710   
Corporate debt obligations       2,348,776      3,772      (177,735) 2,174,813
   
Total debt securities            3,771,516      8,245      (264,133) 3,515,628
Total equity securities             54,403      1,693       ( 2,807)    53,289 
Total debt and equity securities
 available for sale              $3,825,919     $9,938     $(266,940)$3,568,917   
</TABLE>

<TABLE>
<CAPTION>
                                              Gross        Gross
                                 Amortized  Unrealized   Unrealized    Fair
                                   Cost          Gains    (Losses)   Value
<S>                              <C>          <C>         <C>       <C>
Held to Maturity Investments
Government debt securities        $ 20,895      $  35      $( 2,691) $  18,311 
Mortgage backed securities       1,182,083     13,895       (42,637) 1,153,341  
Corporate debt obligations       1,534,742     40,134      ( 26,712) 1,548,164
   
Total debt securities held      $2,737,720    $54,064      $(71,968)$2,719,816
to maturity
</TABLE>

The amortized cost,aggregate fair value, and gross unrealized gains and 
losses pertaining to debt securities as of December 31, 1993 are as follows:

<TABLE>
<CAPTION>
                              Gross        Gross
                                 Amortized  Unrealized   Unrealized    Fair
                                   Cost          Gains    (Losses)   Value
<S>                               <C>          <C>        <C>       <C>
Government debt securities        $368,546      7,836      $( 1,782) $ 374,600 
Mortgage backed securities       1,927,536     92,679       ( 6,019) 2,014,196  
Corporate debt obligations       3,407,755    285,217      ( 12,808) 3,680,164
   
Total debt securities held      $5,703,837   $385,732      $(20,609)$6,068,960
</TABLE>

The amortized cost and estimated fair value of debt securities at 
December 31, 1994 by contractual maturity are shown in the accompanying 
table.  Actual maturities will differ from contractual maturities because 
borrowers may have the right to call or prepay obligations with or 
without call or prepayment penalties.

<TABLE>
<CAPTION>                                   Available for Sale            Held to Maturity 
                                    Carrying     Estimated      Carrying      Estimated
                                        Value        Fair Value        Value         Fair Value
<S>                                    <C>            <C>            <C>             <C>     
Due in one year or less                $  359,863      $ 359,861     $   41,960     $   42,228
Due after 1 year through 5 years          487,990         454,158        155,775        158,558
Due after 5 years through 10 years        1,567,495     1,457,259        519,923        523,353
Due after 10 years through 20 year          225,106        209,070        293,034        292,735
Due after 20 years                          232,978        205,040         544,945        549,601    
Mortgage backed securities                  898,084        830,710       1,182,083      1,153,341
Total                                    $3,771,516   $  3,515,628   $2,737,720    $2,719,816

</TABLE>



Investment income was earned from the following sources:
<TABLE>
<CAPTION>
                                                   1994              1993            1992
<S>                                                <C>          <C>            <C>                 
Interst on debt securities                          $451,229     $  442,082     $390,150
Dividends on equity securities                        5,309            5,439           3,024
Interest on mortgage loans on     
real estate                                          17,182             28,340         54,587
Interest on policy loans                             45,689           31,048          21,605
Real estate                                           5,513             7,393           7,049         
Dividends from affiliates                             2,033          13,200          1,800 
Gross investment income                              526,955       527,502      478,215
Investment expense                                   ( 7,833)         (5,330)         (5,706) 
Interst credited                                    (422,549)    (421,991)     (381,385) 
Net investment income                              $  96,573      $100,181      $ 91,124   



</TABLE>
<TABLE>
<CAPTION>

Summary of realized investment gains and (losses) follows:

                                                    1994             1993           1992
<S>                                             <C>                 <C>             <C>            
Debt Securities:
Gains                                            $37,240            $81,528            $48,515
Losses                                           (21,328)           (18,650)           (27,007)
Total debt securities                              15,912            62,878             21,508

Equity securities:
Gains                                     $   719             $ 3,699           $ 2,267
Losses                                     (2,088)            (    794)           ( 1,195)   
Total equity securities                    (1,369)               2,905               1,072   

Real estate and mortgage loans:
gains                                       $9,045              $1,502             $1,856
losses                                      (2,516)             (4,116)             (3,846)
Total real estate and mortgage loans         6,529               (2,614)             (1,990) 

Total realized investment gains, net                   $21,072            $63,169          $20,590

</TABLE>

(4)Liabilities for future policy benefits
Liabilities for non interest-sensitive life insurance future policy 
benefits are based upon assumed future investment yields,
mortality rates, and withdrawal rates after giving effect 
to possible risks of adverse deviation.  The assumed mortality and
withdrawal rates are based upon the Companies' experiences.
The policy liability for future contract benefits for universal 
life and deferred annuity contracts is determined using the
retrospective deposit method, in accordance with SFAS No. 97, "Accounting 
and Reporting by Insurance Enterprises for
Certain Long-Duration Contracts and for Realized Gains and Losses from 
the Sale of Investments."
The policy liability for immediate annuities is also computed in accordance
with SFAS No. 97.  For AHLIC issues prior to
1987, mortality is based on blends of the 1971 Individual Annuity Mortality 
Table and the 1969-71 U.S. Life tables, with
interest rates ranging from 6% to 14.75%.  For AHLIC 1987 and subsequent 
issues, mortality is based on blends of the
1983a and 1979-81 U.S. Life tables, with interest rates ranging from 4.5%
to 11%.  For FAHL, mortality is based on blends of the 1983a and 1979-81 
U.S. Life tables, with interest rates ranging from 4.5% to 9.5%.
Term insurance reserves are computed in accordance with SFAS No. 60,
"Accounting and Reporting by Insurance Enterprises. For AHLIC policies 
issued prior to 1993, the valuation mortality rates are based on the 196
as adjusted for company experience, and the valuation interest rates grade
from 9.5% to 8% over 10 years.  Beginning in
1993, the valuation mortality rates are based on the 1975-80 Basic Table 
as adjusted for company experience, and the
valuation interest rates grade from 6.5% in duration 1 to 5% in duration 10.
For FAHL policies issued prior to 1994, the valuation mortality rates are 
based on the 1965-70 Basic Table as adjusted for company experience, 
interest rates grade from 9.5% to 8% over ten years.  For the FAHL term 
products introduced in 1994, the valuation mortality rates are based on 
the 1975-80 Basic Table as adjusted for company experience, and the value
grade from 6.5% in duration 1 to 5% in duration 10.

(5)POLICY AND CONTRACT CLAIM liabilities

Activity in the liability for unpaid policy and contract claims and claim 
adjustment expenses is summarized as follows:









<TABLE>
<CAPTION>
                                                    1994                                   1993
<S>                                               <C>                               	 <C>
Balance at January 1                               $41,105                                $36,646
less:reinsurance recoverable                      (2,811)                                 (2,381)
Net balance January 1                               38,294                                  34,265
Incurred related to:
 Current year                                       71,443                                    96,751
 Prior years                                          (193)                                     5,511 
Total Incurred                                        71,250                                   102,262 
Paid related to:
Current year                                          54,837                                      74,378 
Prior years                                           21,456                                      23,855
Total paid                                            76,293                                      98,233

Net balance at December 31                            $33,251                                    $38,294 
Plus: reinsurance recoverables                          3,188                                        2,811
Balance at December 31                                $36,439                                     $41,105   
</TABLE>
						     
(6) REINSURANCE
In accordance with general practice in the insurance industry, portions 
of the life insurance written by the Companies are reinsured; however, 
the Companies remain contingently liable with respect to reinsurance ceded
unable to meet its obligations.  In the opinion of management, the 
Companies' reinsurers are financially stable and
allowances for uncollectible amounts are established against reinsurance 
receivables, if appropriate.  The following table summarizes net premiums 
earned and net insurance benefits and losses incurred: 

<TABLE>
<CAPTION>

                                                      1994                        1993                             1992

<S>                                                  <C>                     <C>    
Premiums written and other 
considerations                                       $231,061                 $218,386                     $209,397
less premiums ceded                                  71,501                     19,674                        22,448
net premiums written and                                
other considerations                                 159,560                   198,712                       186,909
Change in Unearned Premiums                              397                       1,964                          3,688   
Net Premiums and other Consid.                      $159,957                 $200,676                     $190,597

Gross benefits                                     $96,148                 $118,712                     $122,751 
Less reinsurance recoveries                         16,250                     14,700                         22,800        
Net benefits                                        79,898                    103,733                         99,951   
Change in reserves                                 (43,701)                          266                         (2,719)  
Net benefits                                        $36,197                  $103,999                     $   97,232

</TABLE>
 
(7)COMMITMENTS AND CONTINGENCIES
The Companies are parties to litigation occurring in the normal 
course of business.  In the opinion of management, such
litigation will not have a material adverse effect on the Companies' 
financial position or results of operations.

(8)STATUTORY REPORTING
The accompanying financial statements have been prepared on the basis of 
GAAP, which varies from statutory accounting
practices ("SAP") prescribed or permitted by insurance regulatory 
authorities.  The principal differences between SAP and
GAAP are that for SAP (i) certain assets that are nonadmitted assets are 
eliminated from the balance sheet, (ii) acquisition
cost for policies are expensed as incurred, while they are deferred 
and amortized over the life of the policies under GAAP,
(iii) no provision is made for deferred income taxes, (iv) the timing of 
establishing certain reserves is different than under
GAAP; (v) certain notes are considered surplus rather than debt, (vi) 
valuation allowances are established against
investments and (vii) premiums for universal life and annuity products are 
recognized as revenue when collected for SAP
and in the period assessed for GAAP.
The amount of statutory net income and capital and surplus for the Companies
for the years ended December 31 were as
follows:
<TABLE>
<CAPTION>


                                           1994                       1993                             1992
<S>                                  <C>                           <C>    
Net Income                         $  66,063                      $ 40,367                   $ 23,530
Capital and Surplus                   365,146                      251,229                     226,465    

</TABLE>
As it applies to AHLIC, in accordance with the Insurance Code of the State
 of Michigan, dividend payments have certain
limitations without the prior approval of the Director of Insurance.  
In 1995, dividend payments in excess of $58,100 would require prior approval.
AHLIC is required to maintain minimum capital
and surplus of $1,000.  FAHL is required to maintain minimum capital of
$2,000 and additional paid-in surplus of at 
least $4,000 or 200% of its capital, whichever
is greater.  The state of New York has no dividend limitation requirements.

(9)Related-Party and Other Transactions
In the normal course of business and, in management's opinion, at terms 
comparable to those available from unrelated
parties, the Companies have engaged in transactions with its parent and 
affiliates.  A brief description of each of these is
discussed below.
The Companies write credit insurance policies covering loans originated 
by Household Finance's consumer finance subsidiaries and Household 
International's banking subsidiaries.  The principal transactions and 
balance accompanying financial statements are summarized as follows:
<TABLE>
<CAPTION>

                                                         1994                     1993                         1992
<S>                                                    <C>                    <C>   
Premiums                                                $47,100                $58,300                     $57,934
Policy Benefits                                          29,100                 36,400                       37,500  
Due and uncollected                                       6,500                     6,600                          6,300
Policy and contract claims                               34,000                   38,400                       35,900


The Companies paid $3,800, $3,900, and $3,100 in 1994, 1993, and 1992, 
respectively, to Household Finance for administrative expenses.
AHLIC leases two office buildings to its parent and an affiliate, who use 
the buildings as their headquarters and administration facilities.  The 
investment in these buildings was $28,000 and $29,200 at December 31,
1994 and 1993 respectively.  The building leases have combined minimum 
annual rentals of $4,500.  The leases expire in 2013.
Effective October 1, 1994, the Companies entered into a reinsurance ceded 
treaty with Hamilton National Life Insurance Company ("HNLIC"), a 
wholly-owned subsidiary of AHLIC (not included in these financial statements)
block of annuity contracts.  The funds backing the reserves, amounting to 
$64,000, are payable as of December 31, 1994, and are expected to be 
transferred with accrued interest in 1995.  The payable and accrued interest
accompanying balance sheet as payable to affiliate.
During 1994, Alexander Hamilton Insurance Agency ("AHIA"), a subsidiary 
of AHLIC, declared and paid a $2,000 dividend and paid a $500 dividend 
declared in 1993.  In 1993, AHIA declared a $1,200 dividend, with $500 of
dividend payable at December 31, 1993.  During 1992, AHIA declared a 
$1,800 dividend payable to the Companies, of which $400 was payable at 
December 31, 1992.  In 1993, HNLIC declared and paid dividends of $12,00
are reflected in investment income in the accompanying combined 
statements of income. On September 29, 1994, AHLIC entered into a $50,000
9.76% capital note agreement with Household International.  The note 
matures September 30, 2024.  Interest is payable on March 31 and September
1995.  The Companies have recorded $1,230 of interest expense related to 
this note in the accompanying combined statements of income.  The payment 
of principal and/or interest otherwise required or permissible shall 
AHLIC has obtained the prior written approval of the Michigan 
Insurance Bureau and obtained the prior approval of the board of directors,
(ii) such payment will not cause AHLIC to violate its statutory capital
Michigan Insurance Code; and (iii) AHLIC has adequate earned surplus 
funds available for such payment. At December 31, 1994 and 1993, the 
Companies owned $125,000 in securitized Household Finance Corporation
consumer receivables.
During 1993, AHLIC received a $17,000 capital contribution from Household 
International. 

(10)income taxes
A reconciliation of the federal income tax rate to the Companies' effective 
rate for each year is as follows:

</TABLE>
<TABLE>
<CAPTION>
                                                                         1994            1993          1992
<S>                                                                    <C>              <C>	      <C>
Federal income tax at the stautory
rate                                                                     35.0%          35.0%           34.0%
Tax -e xempt interst and dividends
reduction received                                                       (.6)           (3.7)           (.7)
State Taxes                                                               .8             1.3             1.0    
Other (decrease) increase,net                                            (.3)            (.8)             .9 
Provision for income taxes                                              34.9%           31.8%             35.2%

</TABLE>

<TABLE>
<CAPTION>
The tax effects of temporary differences that result in significant 
deferred tax assets and liabilities are as follows:

                                                                        1994                                1993 
<S>                                                                <C>                                    <C>     
Deferred tax assets:
Insurance reserves                                                  $     174,265                           $145,584
Invested assets basis                                                       9,328                             14,594 
Net unrealized investment losses                                            45,581                                -
Total Deferred tax assets                                                  229,174                            160,178
Deferred tax liabilities										   
deferred policy acquisition costs                                          126,563                        
Leverage leases                                                             30,846                            27,822
Net unrealized investment gains                                                 -                              1,930
Other                                                                         2,771                            1,816
Total Deferred tax liabilities                                              160,180                          163,158

Net deferred tax assets (liabilities)                                       $68,994                        $ (2,980)
</TABLE>

<TABLE>
<CAPTION>
The components of the provision are:
                                                                 1994                  1993                1992
<S>                                                            <C>                <C>      	      <C>
Current:
 Federal                                                        $ 62,075          $ 59,761              $ 44,013
 State                                                              920              1,584                 1,081   

Deferred:
Federal                                                          (24,588)         (22,957)               ( 8,038)
Total                                                          $  38,407          $38,388                $37,056  
</TABLE>

(11)EMPLOYEE BENEFIT PLANS
The Companies participate in defined benefit pension plans of Household 
International covering substantially all of their
employees.  Plan benefits are based primarily on years of service.  
Plan assets primarily consist of equity securities
including those of foreign issuers and corporate and government obligations.
Pension income for defined benefit plans, primarily due to the overfunded 
status of the domestic plan, included the following components:
<TABLE>
<CAPTION>

Year ended December 31                                           1994            1993      1992
<S>                                                         <C>                <C>      <C>              
Service costs-benefits earned during
 the period                                                   $ (1,072)       $(1,430)     $(1,253)
Interest cost on projected benefit
 obligation                                                     (1,266)          (1,450)    (1,377) 
Expected return on assets                                        2,142             2,765     2,616 
Net amortization deferral                                          653                653      653
Pension Income                                                $    457           $   538      $ 639 

</TABLE>

The funded status of the defined benefit pension plan attributable to 
the Companies was as follows:

<TABLE>

<CAPTION>


At December 31                               1994                 1993

<S>                                   <C>                      <C>                                                    
Actuarial present value of:      
Vested benefits obligation                  $ 8,911                  $13,419
Nonvested benefits obligation                3,461                   4,175
Accumulated benefit obligation              12,372                  17,594    
Effexts on anticipated future
 compensation levels                        2,572                      2,653
Projected benefit obligation               14,944                     20,247

Plan assets at fair value                  22,094                     30,785
Plan assets in excess of projected
 benefit obligation                      $ 7,150                  $ 10,538

</TABLE>

The 1994 and 1993 projected benefit obligations for the defined benefit 
plans were determined using an assumed weighted
average discount rate of 8.25% and 7.25%, respectively, an assumed 
compensation increase of 4.75% and 3.75%,
respectively, and an assumed weighted average long-term rate of return on 
plan assets of 10.0% and 9.5%, respectively.

At December 31, the excess of plan assets over the projected benefit 
obligation included the following components:


<TABLE>
<CAPTION>
                                                                             



                                                            1994                        1993

<S>                                                        <C>                         <C>           
Unamortized prior service costs                            $( 173)                     $(   204)
Net unrecognized loss from past experience
diffferent from assumed and effects of
changes in assumptions                                      (3,361)                     (    169)
Unamortized assets                                           2,675                        3,359
Prepaid pension costs                                        8,009                        7,552
Plan assets in excess of projected benefit
 obligation                                                $ 7,150                      $ 10,538

</TABLE>

The straight-line method of amortization is used for prior service cost 
and unrecognized gains and losses.
The Companies also participate in a defined contribution plan of Household 
International where each participant's
contribution is matched by the Companies up to a maximum of 6% of the 
participant's compensation.  For 1994, 1993,
and 1992, these costs totaled approximately $1,000 annually.
The Companies have several plans which provide medical, dental, and 
life insurance benefits to retirees and eligible
dependents.  The plans are funded on a pay-as-you-go basis and cover 
substantially all employees who meet certain age
and vested service requirements.  The Companies have instituted dollar 
limits on its payments under the plans to control
the cost of future medical benefits.
Effective January 1, 1993, the Companies adopted SFAS No. 106 "Employers' 
Accounting for Postretirement Benefits
Other Than Pensions,"  which requires the accrual of the cost of providing 
postretirement benefits for medical, dental, and
life insurance coverage over the active service period of the employee.  
The Companies adopted SFAS No. 106 on a prospective basis, which amortizes 
the obligation existing at the adoption date over 20 years.  The unrealized
obligation was $2.3 million and $2.4 million at December 31, 1994 and 1993.

At December 31, the net postretirement benefit cost included the following:
<TABLE>
<CAPTION>
	 
	                                                    1994                         1993
<S>                                                  <C>                           <C>         
Service costs benefits earned during the period        $340                         $432
Interest cost on accumulated post retirement 
 benefit obligation                                     302                            249
Net amortization and deferral                           146                            127
Net periodic post retirement benefit cost              $788                           $808

</TABLE>
Through 1992, it had been the Companies' policy to charge the cost of 
retiree health care and life insurance benefits to expense when benefits 
were paid.  The cost of plans which cover retirees and eligible depend
States is not significant to the Companies.
The actuarial and recorded liabilities for postretirement benefit plans, 
none of which have been funded, were:

<TABLE>
<CAPTION>
                                                             1994                      1993
<S>                                                       <C>                      <C>   
Actuarial present value of post retirement
benefit obligation for:
 Retirees                                                   $ 1,632                  $ 2,215
 Fully eligible active participants                           1,128                    1,524     
 Other active participants                                    2,647                    2,588
Accumulated postretirement benefit obligation                 5,407                    6,327
Net unrealized gain (loss) from past experience
 different from assumed and effects of changes
 in assumptions                                                 736                   (1,086) 
Unamortized liability                                        (4,199)                 (4,432)  
Accrued Post retirement benefit obligation                  $ 1,944                  $   809
</TABLE>

The December 31, 1994 and 1993 accumulated postretirement benefit 
obligation was determined using an assumed weighted average discount rate 
of 8.5% and 7.5%, respectively, and an assumed annual compensation in
and 3.75% respectively.  A 14.2% and 15.0% annual rate of increase in 
the gross cost of covered health care benefits was
assumed for 1994 and 1993, respectively.  This rate of increase is assumed 
to decline by one percentage point in each year
after 1995.
The health care cost trend rate assumption has an effect on the amounts 
reported.  To illustrate, increasing the assumed
health care cost trend rate by 1% would have increased both the 1994 and 
1993 net periodic postretirement benefit obligation at December 31, 1994 
and 1993 by $297 and $297, respectively. 

Incentive Compensation and Stock Option Plans
Certain members of management of the Companies participate in Household 
International's executive compensation plans which provide for the issuance 
of nonqualified stock options and incentive stock options.  These 
holder to purchase, under certain limitations, Household International's 
common stock at a price not less than 100 percent of the market value of 
the stock on the date the option is granted. 

Deferred Agent Compensation
The Companies sponsor a contributory deferred compensation plan for 
certain qualified agents.  The accumulated value of both the Companies' 
and the agents' contributions was $33,000 and $32,100 at December 31, 1994
and 1993 respectively, and is included with accounts payable and accrued 
expenses.  In 1991, the Companies established a Rabbi Trust supporting 
the liability which is recorded at the market value of the underlying as
other assets.
(12) Derivatives
The Companies have limited involvement with derivative financial instruments
 and do not use these instruments for trading purposes.  They are generally 
used to manage well-defined interest rate risk and to hedge investment
Interest rate cap agreements with notional value of $500,000 were initiated
the cap transactions, which had an original maturity in 1996, was to hedge 
annuity liabilities.  A gain of $1,400 was recognized upon termination.
Interest rate swap transactions with a notional value of $495,000 were 
entered into during 1993 and 1994.  Swaps with a notional value of 
$300,000 were terminated during 1994 at a loss of $400.  Swaps with a 
notional remain open as of December 31, 1994.  Termination of these swaps 
at current market interest rates would result in a settlement payment of 
$12,900 as of December 31, 1994. Interest is exchanged monthly on notional 
value of $125,000, with the Companies receiving a weighted average return
5.28% and paying 1 month LIBOR (6.00% at December 31, 1994) on a net 
exchange basis.  On the remaining $70,000 of notional value, the Companies 
receive a fixed rate of 6.68% and pay 3 month LIBOR (6.50% at December 31)
net exchange basis.  The net amount received or paid under these swaps is 
reflected as an adjustment to interest income.
Futures contracts were entered into and terminated during 1994 to hedge 
existing and anticipated investment transactions. Deferred realized losses 
from these terminations were $9,600 in 1994, which will be amortized 
Although off-balance sheet derivative financial instruments do not expose 
notional amount, such agreements generate credit risk to the extent of the 
fair value gain in an off-balance sheet derivative financial instrument if 
the counterparty fails to perform.  Such risk is minimized based on  
and the consistent monitoring of these agreements.  The counterparties to 
and investment banks, all of which were approved by AHLIC's asset and 
liability committee.

<PAGE>





EXHIBIT 7 (a) (ii)

<TABLE>
   ALEXANDER HAMILTON LIFE INSURANCE COMPANY OF AMERICA,
   FIRST ALEXANDER HAMILTON LIFE INSURANCE COMPANY, AND
   ALEXANDER HAMILTON CAPITAL MANAGEMENT, INC.
   COMBINED BALANCE SHEETS
   (Dollar Amounts in Thousands)
<CAPTION>   
   
                                                             June 30,    Dec. 31,
                          ASSETS                               1995        1994  
                                                           (Unaudited)
<S>                                                       <C>          <C> 
   CASH AND INVESTMENTS:
     Cash and cash equivalents                             $    4,546  $   10,380
     Debt securities available for sale, at fair value      3,888,761   3,515,628
     Debt securities held to maturity, at amortized cost    2,744,567   2,737,720
     Equity securities available for sale, at market value     66,165      53,289
     Mortgage loans on real estate                            216,630     161,883
     Policy loans                                             776,673     544,198
     Real estate                                               79,807      81,153
     Other investments                                          1,722       1,722
        Total cash and investments                          7,778,871   7,105,973
   
   ACCRUED INVESTMENT INCOME                                  104,791     103,929
   
   ACCOUNTS RECEIVABLE AND AGENTS' BALANCES                    45,635      57,607
   
   DUE FROM REINSURERS                                         84,791      82,165
   
   PROPERTY AND EQUIPMENT                                      18,156      20,088
   
   DEFERRED POLICY ACQUISITION COSTS, net of amortization     480,543     618,652
   
   DEFERRED INCOME TAX ASSETS                                  23,700      68,994
   
   OTHER ASSETS                                                11,646       9,330
   
        TOTAL ASSETS                                       $8,548,133  $8,066,738
</TABLE>   
   The accompanying note is an integral part of these combined statements.

<TABLE>

   
        ALEXANDER HAMILTON LIFE INSURANCE COMPANY OF AMERICA,
                                  
        FIRST ALEXANDER HAMILTON LIFE INSURANCE COMPANY, AND
                                  
             ALEXANDER HAMILTON CAPITAL MANAGEMENT, INC.
                                  
                                  
                       COMBINED BALANCE SHEETS
                                  
                    (Dollar Amounts in Thousands)
<CAPTION>                                  
                                  
                                                          June 30,     Dec.31,
                                   LIABILITIES AND COMBINED COMPANIES EQUITY                 1995        1994   
                                                          (Unaudited)
   
<S>                                                     <C>          <C>
   POLICY LIABILITIES:
     Future policy benefits                               $7,545,625  $7,087,065
     Dividend accumulations and other policyholder funds
       on deposit                                              2,388       2,021
     Policy and contract claims                               43,370      36,439
     Unearned premium reserves                                 3,734       3,502
        Total policy liabilities                           7,595,117   7,129,027
   
   INCOME TAXES PAYABLE                                       10,817      20,008
   
   ACCOUNTS PAYABLE AND ACCRUED EXPENSES                     132,590     157,620
   
   PAYABLE TO AFFILIATE                                        4,371      67,768
   
   NOTE PAYABLE TO PARENT                                     50,000      50,000
   
        Total liabilities                                  7,792,895   7,424,423
   
   
   COMBINED COMPANIES EQUITY:
     Combined companies equity                               761,738     733,076
     Net unrealized gain (loss) on securities available 
       for sale                                                1,848     (81,835)
     Net unrealized losses or foreign exchange
       transactions                                           (8,348)     (8,926)
   
        Total combined companies equity                      755,238     642,315
        TOTAL LIABILITIES AND COMBINED COMPANIES EQUITY   $8,548,133  $8,066,738
</TABLE>   
   
   
   The accompanying note is an integral part of these combined statements.
   
   
   
   
                                           
   
<TABLE>   
        ALEXANDER HAMILTON LIFE INSURANCE COMPANY OF AMERICA,
                                  
        FIRST ALEXANDER HAMILTON LIFE INSURANCE COMPANY, AND
                                  
             ALEXANDER HAMILTON CAPITAL MANAGEMENT, INC.
                                  
                                  
                    COMBINED STATEMENTS OF INCOME
                                  
                    (Dollar Amounts in Thousands)
                                  
<CAPTION>                                  
                                                         Six Months Ended
                                                           June 30, 
                                                                                              1995        1994   
                                                          (Unaudited) (Unaudited)
<S>                                                       <C>         <C> 
   REVENUE:
     Life premiums                                         $  23,187   $  26,784
     Accident and health premiums                             13,185      12,500
     Contract revenue                                         68,317      67,108
        Total premiums and other considerations              104,689     106,392
     Net investment income                                    64,971      36,792
     Realized investment gains (losses)                       (3,138)     26,912
                                                             166,522     170,096
   
   BENEFITS AND EXPENSES:
     Life benefits                                            42,511      37,861
     Accident and health benefits                              6,658       6,246
     (Decrease) increase in reserves                           1,978        (561)
     Other policyholder benefits                                 357       3,738
        Total benefits                                        51,504      47,284
     Insurance commissions                                    31,740      34,753
     General and administrative                               26,703      29,217
     Insurance taxes, licenses, and fees                       9,811       8,016
     Interest expense                                          2,453        -   
        Total expenses                                        70,707      71,986
   
   INCOME FROM OPERATIONS BEFORE INCOME TAXES                 44,311      50,826
   INCOME TAXES                                               15,649      17,587
   
   NET INCOME                                              $  28,662   $  33,239
   
   
</TABLE>   
   
   The accompanying note is an integral part of these combined statements.
   
   
   
   
   
<TABLE>   
        ALEXANDER HAMILTON LIFE INSURANCE COMPANY OF AMERICA,
                                  
        FIRST ALEXANDER HAMILTON LIFE INSURANCE COMPANY, AND
                                  
             ALEXANDER HAMILTON CAPITAL MANAGEMENT, INC.
                                  
                                  
                  COMBINED STATEMENTS OF CASH FLOWS
                                  
                    (Dollar Amounts in Thousands)
                                  
<CAPTION>
                                  
                                                         Six Months Ended
                                                           June 30, 
                                                                                              1995        1994  
<S>                                                      <C>         <C>
   CASH FLOWS FROM OPERATING ACTIVITIES:
     Net Income                                           $   28,662  $   33,239
     Adjustments to reconcile net income to net cash
       provided by operating activities:
         Policy liabilities                                  466,090     449,010
         Deferred policy acquisition costs                   (55,217)    (71,780)
         Depreciation and amortization                        43,306      56,068
         Deferred income taxes (benefit)                      (1,282)     (2,980)
         Amounts receivable and other assets                   6,168     (21,605)
         Accounts payable and accrued expenses               (34,221)     12,825
         Realized investment (gains) losses                    3,138     (26,912)
           Total adjustments                                 427,982     394,626
           Net cash provided by operating activities         456,644     427,865
   CASH FLOWS FROM INVESTING ACTIVITIES:
     Purchases of investment securities                   (1,811,101) (1,898,895)
     Proceeds from sales and maturities of investment 
       securities                                          1,698,444   1,494,747
     Purchases of mortgage loans and real estate             (72,996)     (1,049)
     Proceeds from sales of real estate                        1,186      13,817
     Proceeds from payments on mortgage principle             18,249      52,821
     Policy loans, net                                      (232,475)    (89,921)
     Additions to property, plant and equipment                 (388)       (527)
        Net cash used in investing activities               (399,081)   (429,007)
   CASH FLOWS FROM FINANCING ACTIVITIES:
     Increase (decrease) in note payable and payable 
       to affiliate                                          (63,397)        711
     Net cash provided by (used for) financing activities    (63,397)        711
        Net decrease in cash and cash equivalents             (5,834)       (431)
   CASH AND CASH EQUIVALENTS, beginning of year               10,380      13,821
   
   CASH AND CASH EQUIVALENTS, end of year                 $    4,546  $   13,390
   
</TABLE>   
   The accompanying note is an integral part of these combined statements.
   
   
   Alexander Hamilton Life Insurance Company
   First Alexander Hamilton Life Insurance Company, and
   Alexander Hamilton Capital Management, Inc.
   Note to Combined Condensed Financial Statements
   Unaudited
   Basis of Presentation
The accompanying combined condensed financial statements include Alexander
Hamilton Life Insurance Company of America ("AHLIC"), First Alexander Hamilton
Life Insurance Company ("FAHL"), and Alexander Hamilton Capital Management,
Inc.("AHCM") and are unaudited, but, in the opinion of management, reflect all
adjustments necessary to present fairly the combined condensed June 30, 1995
balance sheet and statements of income and cash flows for the six months ended
June 30, 1995 and 1994.  Such adjustments consist only of normal recurring
accruals and adjustments.  These financial statements have been combined and
prepared as a result of the Stock Purchase Agreement between the Household
Group, Household International, Inc., Alexander Hamilton Life Insurance Company
of America and Jefferson - Pilot Corporation dated August 9, 1995 and exclude
certain AHLIC subsidiaries that have not been acquired.
These combined condensed financial statements should be read in conjunction with
the audited combined financial statements and related notes.  Combined net
income and cash flows for the interim periods reflected in the accompanying
combined condensed financial statements are not neceassarily indicative of those
to be expected for the entire fiscal year.
   
   
   
   
   
   
   
   
   
                           TABLE OF CONTENTS
   
                                                            Page No.
   
                         ARTICLE I.DEFINITIONS
   
   SECTION 1.1.    Defined Terms . . . .  . . . . . . . . . . . . .2
   SECTION 1.2.    Other Terms . . . . .  . . . . . . . . . . . . 11
   
   
                ARTICLE II.PURCHASE AND SALE OF SHARES
   
   SECTION 2.1.    Transfer of Shares. .  . . . . . . . . . . . . 12
   SECTION 2.2.    Purchase Price. . . . . . . . . . . . . .. . . 12
   SECTION 2.3.    Post-Closing Adjustment . . . . . . . . .. . . 12
   SECTION 2.4.    Dispute Resolution. . . . . . . . . . . .. . . 14
   
   
                         ARTICLE III.CLOSING 
   
   SECTION 3.1.    Time and Place of Closing . . . . . . . . .  . 15
   SECTION 3.2.    Deliveries by Sellers . . . . . . . . . . .  . 15
   SECTION 3.3.    Deliveries by Purchaser . . . . . . . . . .  . 16
   
   
                    ARTICLE IV.GUARANTEE BY PARENT
   
   SECTION 4.1.    Guarantee of Seller's Performance . . . . .  . 16
   SECTION 4.2.    Waiver. . . . . . . . . . . . . . . . . . .  . 16
   
   
     ARTICLE V.REPRESENTATIONS AND WARRANTIES OF SELLER AND PARENT
   
   SECTION 5.1.    Incorporation and Qualification; Subsidiaries  16
   SECTION 5.2.    Articles of Incorporation--By-Laws. . . . . .  18
   SECTION 5.3.    Acquired Subsidiaries . . . . . . . . . . . .  18
   SECTION 5.4.    Scope of Business . . . . . . . . . . . . . .  19
   SECTION 5.5.    Authorization . . . . . . . . . . . . . . . .  19
   SECTION 5.6.    Capitalization. . . . . . . . . . . . . . . .  19
   SECTION 5.7.    Ownership of Shares and Note. . . . . . . . .  19
   SECTION 5.8.    Statutory Statements. . . . . . . . . . . . .  20
   SECTION 5.9.    GAAP Financial Statements . . . . . . . . . .  20
   SECTION 5.10.   Investments; Defaults. . . . . . . . . . . . . 20
   SECTION 5.11.   Twindex Policies . . . . . . . . . . . . . . . 21
   SECTION 5.12.   Reserves . . . . . . . . . . . . . . . . . . . 21
   SECTION 5.13.   Bank Accounts; Custodial Accounts; Receivables 22
   SECTION 5.14.   Material Contracts (Other Than Reinsurance). . 22
   SECTION 5.15.   Reinsurance Treaties . . . . . . . . . . . . . 23
   SECTION 5.16.   Employees and Compensation . . . . . . . . . . 24
   SECTION 5.17.   Employee Benefit Plans . . . . . . . . . . . . 25
   SECTION 5.18.   Producers for the Company. . . . . . . . . . . 27
   SECTION 5.19.   Insurance. . . . . . . . . . . . . . . . . . . 28
   SECTION 5.20.   Insurance Policy Forms and Rates . . . . . . . 29
   SECTION 5.21.   Litigation and Regulatory Investigations . . . 29
   SECTION 5.22.   Compliance with Applicable Laws and Regulations30
   SECTION 5.23.   Brokers' or Finders' Fees. . . . . . . . . . . 30
   SECTION 5.24.   Full Disclosure; No Misrepresentations . . . . 30
   SECTION 5.25.   Dividends; Distributions on the Note . . . . . 30
   SECTION 5.26.   Property . . . . . . . . . . . . . . . . . . . 31
   SECTION 5.27.   Patents and Trademarks; Technology . . . . . . 32
   SECTION 5.28.   Absence of Certain Changes or Events . . . . . 33
   SECTION 5.29.   Agreement Does Not Violate Other Agreements. . 35
   SECTION 5.30.   Consents and Approvals . . . . . . . . . . . . 36
   SECTION 5.31.   Environmental Matters. . . . . . . . . . . . . 36
   SECTION 5.32.   Liabilities. . . . . . . . . . . . . . . . . . 38
   SECTION 5.33.   Disclaimer . . . . . . . . . . . . . . . . . . 38
   SECTION 5.34.   Related Party Agreements . . . . . . . . . . . 38
   SECTION 5.35.   Policy Information . . . . . . . . . . . . . . 39
   SECTION 5.36.   COLI Agreements. . . . . . . . . . . . . . . . 39
   SECTION 5.37.   Certain Business Practices . . . . . . . . . . 39
   
   
        ARTICLE VI.REPRESENTATIONS AND WARRANTIES OF PURCHASER
   
   SECTION 6.1.    Organization and Standing . . .. . . . . . . . 40
   SECTION 6.2.    Authority . . . . . . . . . . .. . . . . . . . 40
   SECTION 6.3.    Investment Representation . . .. . . . . . . . 40
   SECTION 6.4.    Consents and Approvals. . . . .. . . . . . . . 40
   SECTION 6.5.    No Conflict or Violation. . . .. . . . . . . . 41
   SECTION 6.6.    Financial Ability . . . . . . .. . . . . . . . 41
   SECTION 6.7.    Litigation. . . . . . . . . . .. . . . . . . . 41
   SECTION 6.8.    Brokers . . . . . . . . . . . .. . . . . . . . 42
   
   
    ARTICLE VII.CONDUCT AND TRANSACTIONS PRIOR TO THECLOSING DATE;
                            CERTAIN COVENANTS
   SECTION 7.1.    Maintenance of Business; Certain Transactions  42
   SECTION 7.2.    Reports . . . . . . . . . . . . . . . . . . .  44
   SECTION 7.3.    Corporate Existence . . . . . . . . . . . . .  44
   SECTION 7.4.    Twindex Policies. . . . . . . . . . . . . . .  45
   SECTION 7.5.    Further Assurances. . . . . . . . . . . . . .  45
   SECTION 7.6.    Access. . . . . . . . . . . . . . . . . . . .  45
   SECTION 7.7.    Consents. . . . . . . . . . . . . . . . . . .  46
   SECTION 7.8.    Notification of Certain Matters . . . . . . .  46
   SECTION 7.9.    Performance . . . . . . . . . . . . . . . . .  46
   SECTION 7.10.   Negotiations . . . . . . . . . . . . . . . . . 46
   SECTION 7.11.   Tax Basis. . . . . . . . . . . . . . . . . . . 47
   SECTION 7.12.   Computer Services and Software . . . . . . . . 47
   SECTION 7.13.   Business Transfer. . . . . . . . . . . . . . . 48
   SECTION 7.14.   Non-Solicitation . . . . . . . . . . . . . . . 48
   SECTION 7.15.   Sale of Office Building to Parent; Lease
                   Modification . . . . . . . . . . . . . . . . . 48
   SECTION 7.16.   Cross-Defaults . . . . . . . . . . . . . . . . 49
   SECTION 7.17.   Payments on the Note; Other Dividends. . . . . 49
   SECTION 7.18.   Name Change. . . . . . . . . . . . . . . . . . 50
   SECTION 7.19.   Delivery of Additional Financial Statements. . 50
   SECTION 7.20.   Administrative Services. . . . . . . . . . . . 50
   
   
                  ARTICLE VIII.COVENANTS OF PURCHASER
   SECTION 8.1.    Performance . . . . . . . . .. . . . . . . . . 51
   SECTION 8.2.    Further Assurances. . . . . .. . . . . . . . . 51
   SECTION 8.3.    Consents and Notices. . . . .. . . . . . . . . 51
   SECTION 8.4.    Employee Benefit Plans. . . .. . . . . . . . . 52
   SECTION 8.5.    Excess Benefit Plan . . . . .. . . . . . . . . 54
   SECTION 8.6.    Employee Welfare Benefit Plans.  . . . . . . . 55
   SECTION 8.7.    Benefits Transition . . . . . .  . . . . . . . 57
   
   
                   ARTICLE IX.CONDITIONS TO CLOSING
   
   SECTION 9.1.    Conditions to Each Party's Obligations. . . . .57
   SECTION 9.2.    Conditions to Sellers' Obligations. . . . . . .58
   SECTION 9.3.    Conditions to Purchaser's Obligations . . . . .59
   
   
                         ARTICLE X.TERMINATION
   
   SECTION 10.1.   Termination. . . . . . . . . . . . . . . . . . 62
   
   
                ARTICLE XI.SURVIVAL AND INDEMNIFICATION
   
   SECTION 11.1.   Survival . . . . . . . . . . . . . . . . . . . 64
   SECTION 11.2.   Sellers' Indemnification . . . . . . . . . . . 64
   SECTION 11.3.   Purchaser's Indemnification. . . . . . . . . . 67
   SECTION 11.4.   Indemnification Procedure. . . . . . . . . . . 67
   
   
                        ARTICLE XII.TAX MATTERS
   SECTION 12.1.   Tax Sharing Agreements . . . . . . . . . . . . 68
   SECTION 12.2.   Representations, Warranties, Agreements, and
                   Covenants of Seller with Regard to Certain Tax
                   Matters. . . . . . . . . . . . . . . . . . . . 69
   SECTION 12.3.   Representations, Warranties, Agreement, and
                   Convenants of Purchaser with Regard to Certain
                   Tax Matters. . . . . . . . . . . . . . . . . . 72
   SECTION 12.4.   Joint Agreements and Covenants of Seller and
                   Purchaser. . . . . . . . . . . . . . . . . . . 73
   SECTION 12.5.   Straddle Period Tax Allocations. . . . . . . . 78
   SECTION 12.6.   Determination Of Tax Benefit . . . . . . . . . 78
   SECTION 12.7.   Tax Dispute Resolution Mechanism . . . . . . . 79
   
   
                 ARTICLE XIII.MISCELLANEOUS PROVISIONS
   
   SECTION 13.1.   Entire Agreement; Waiver . . . . . . . . . . . 79
   SECTION 13.2.   Amendment and Modification . . . . . . . . . . 79
   SECTION 13.3.   Confidentiality. . . . . . . . . . . . . . . . 80
   SECTION 13.4.   Specific Performance . . . . . . . . . . . . . 81
   SECTION 13.5.   Expenses . . . . . . . . . . . . . . . . . . . 81
   SECTION 13.6.   Notices. . . . . . . . . . . . . . . . . . . . 81
   SECTION 13.7.   Severability . . . . . . . . . . . . . . . . . 83
   SECTION 13.8.   Assignment . . . . . . . . . . . . . . . . . . 83
   SECTION 13.9.   Third Parties. . . . . . . . . . . . . . . . . 83
   SECTION 13.10.  Captions . . . . . . . . . . . . . . . . . . . 84
   SECTION 13.11.  Governing Law. . . . . . . . . . . . . . . . . 84
   SECTION 13.12.  Choice of Forum. . . . . . . . . . . . . . . . 84
   SECTION 13.13.  WAIVER OF JURY TRIAL . . . . . . . . . . . . . 84
   SECTION 13.14.  Counterparts . . . . . . . . . . . . . . . . . 84
   SECTION 13.15.  Drafting . . . . . . . . . . . . . . . . . . . 84
   SECTION 13.16.  Books and Records. . . . . . . . . . . . . . . 85
   SECTION 13.17.  Governmental Notices . . . . . . . . . . . . . 85
   SECTION 13.18.  Exhibits . . . . . . . . . . . . . . . . . . . 85
   
      <PAGE>
                  LIST OF ANNEXES AND EXHIBITS
   
        Annex A   Description of Affiliated Business Transfer
        Annex B   Description of COLI Business Transfer
        Annex C   Description of PPA Business Transfer
   
       Exhibit A  Indemnified Liabilities
       Exhibit B  Form of Parent Guarantees
   
       Exhibit 5.1     Incorporation and Qualification; Subsidiaries
       Exhibit 5.3     Acquired Subsidiaries
       Exhibit 5.10    Investments; Defaults
       Exhibit 5.11    Twindex Policies
       Exhibit 5.14    Material Contracts (Other than Reinsurance)
       Exhibit 5.15    Reinsurance Treaties
       Exhibit 5.16    Employees and Compensation
       Exhibit 5.17    Employee Benefit Plans
       Exhibit 5.22    Compliance with Applicable Laws and
                       Regulations
       Exhibit 5.24    Full Disclosure; No Misrepresentation
       Exhibit 5.26    Property
       Exhibit 5.27    Patents and Trademarks; Technology
       Exhibit 5.28    Absence of Certain Changes or Events
       Exhibit 5.29    Agreement Does Not Violate Other Agreements
       Exhibit 5.34    Related Party Agreements
       Exhibit 5.35    Policy Information
       Exhibit 5.36    COLI Agreements
       Exhibit 5.37    Certain Business Agreements
       Exhibit 5.38    Twindex Policies
       Exhibit 8.4     Severance Policy
          Exhibit 12.2    Certain Tax Matters<PAGE>
   
                     STOCK PURCHASE AGREEMENT
   
   
   STOCK PURCHASE AGREEMENT dated as of August 9, 1995, by and among
   HOUSEHOLD GROUP, INC., a Delaware corporation ("Seller"), HOUSEHOLD
   INTERNATIONAL, INC., a Delaware corporation ("Parent"), ALEXANDER
   HAMILTON LIFE INSURANCE COMPANY OF AMERICA, a stock life insurance
   company organized under the laws of the State of Michigan (the
   "Company"), and JEFFERSON-PILOT CORPORATION, a North Carolina
   corporation ("Purchaser").
   
   
                       W I T N E S S E T H
   
   WHEREAS, Seller owns all of the 375,000 shares of capital stock of
   the Company issued and outstanding as of the date hereof (the
   "Shares");
   
   WHEREAS, Parent has purchased from the Company and holds a $50
   million subordinated surplus note dated September 29, 1994 (the
   "Note");
   
   WHEREAS, Parent directly owns all the outstanding common stock of
   HFC and HFC directly owns all the outstanding capital stock of
   Seller;
   
   WHEREAS, Seller and Parent desire to sell and transfer to Purchaser
   and Purchaser desires to purchase and receive from Seller and
   Parent, as the case may be, the Shares and the Note for the
   consideration, upon the terms and subject to the conditions
   hereinafter set forth;
   
   WHEREAS, Parent desires that Purchaser purchase the Shares, which
   purchase is beneficial to Parent, and is willing to guarantee the
   obligations of Seller herein in order to induce Purchaser to
   purchase the Shares from Seller; 
   
   WHEREAS, except as otherwise provided herein, Purchaser and Seller
   have agreed to make Section 338(h)(10) Elections, all on the terms
   set forth in this Agreement; 
   
   WHEREAS, notwithstanding the preceding paragraph, the Parties have
   agreed that if a transaction qualifying under Section 351 of the
   Code, as more particularly described herein, can be accomplished on
   or before December 31, 1995 and satisfy certain conditions, and the
   Parties have jointly determined by September 30, 1995 that such
   conditions are likely to be satisfied, then the Parties will
   utilize such alternative structure rather than the structure
   including the Section 338(h)(10) Election described hereinabove;
   and
   
   WHEREAS, Parent, Seller and the Company intend to arrange for the
   contribution of the PPA Business Assets to the PPA Companies and
   the reinsurance of the PPA Business Liabilities by such PPA
   Companies and the contribution of the Affiliated Business Assets
   and the COLI Business Assets to the Retained Subsidiaries and the
   reinsurance of Affiliated Business Liabilities and the COLI
   Business Liabilities by the Retained Subsidiaries in accordance
   with the terms and conditions provided herein and in the
   Transaction Documents, followed by the distribution to Seller of
   the PPA Companies and the Retained Subsidiaries.
   
                           A G R E E M E N T
   
   NOW, THEREFORE, in consideration of the premises and the mutual
   agreements hereinafter set forth and other good and valuable
   consideration, the receipt and sufficiency of which are hereby
   acknowledged, the Parties hereto agree as follows:
   
   
                               ARTICLE I.
                              DEFINITIONS
   
   SECTION 1.1.  Defined Terms
   
             "acquisition proposal" shall have the meaning provided in
   Section
   7.10.
   
             "Acquired Companies" shall mean collectively, the Company and
   the
   Acquired Subsidiaries.
   
             "Acquired Subsidiaries" shall have the meaning provided in
   Section
   5.3.
   
             "Administrative Services Agreement" shall have the meaning
   provided
   in Section 7.20.
   
             "Affiliate" shall mean, with respect to any Person, any other
   Person that directly, or indirectly through one or more
   intermediaries, controls, is controlled by, or is under common
   control with the Person specified.
   
             "Affiliated Business" shall mean the business of initiating,
   selling and administering credit life and accident and health
   insurance business and specialty products in conjunction with the
   lending activities of Parent and its subsidiaries as undertaken by
   the Company and its subsidiaries.
   
             "Affiliated Business Assets" shall mean the assets of the
   Company
   allocated to the Affiliated Business in the manner described in
   Annex A.
   
             "Affiliated Business Liabilities" shall mean all of the
   liabilities
   and other obligations of the Company as described in Annex A and
   all other liabilities and other obligations of the Company and
   First Alexander Hamilton Life Insurance Company that arise out of
   the Affiliated Business Assets and arising or relating to the
   Affiliated Business, regardless of whether such liabilities or
   obligations are primary or secondary, direct or indirect, absolute
   or contingent, contractual, tortious or otherwise.
   
             "Affiliated Business Reinsurance Agreements" shall mean the
   reinsurance agreements between the Retained Subsidiaries and the
   Company or First Alexander Hamilton Life Insurance Company entered
   into in accordance with Annex A.
   
             "Affiliated Business Transfer" shall mean the transfer of the
   Affiliated Business Assets to, and the reinsurance of the
   Affiliated Business Liabilities by, the Retained Subsidiaries in
   accordance with Annex A.
   
             "AHLIC-AZ" shall mean the Alexander Hamilton Life Insurance
   Company
   of Arizona, a stock life and disability insurance company organized
   under the laws of the state of Arizona.
   
             "Alexander Hamilton Parties" shall mean collectively, Parent,
   Seller and the Company.
   
             "Allocation Agreement" shall have the meaning provided in
   Section 12.4(g).
   
             "Arbiter" shall have the meaning provided in Section 2.4.
   
             "Asset Allocation Agreement" shall mean the Asset Allocation
   Understanding regarding the allocation of assets to the Individual
   Business, dated as of August 9, 1995, by and between Parent and
   Purchaser.
   
             "Benefit Plans" shall have the meaning provided in Section
   5.17(a).
   
             "Business" shall mean the business of the Company and its
   subsidiaries as currently conducted, including the Affiliated
   Business, the COLI Business, the PPA Business and the Individual
   Business, but excluding the Property and Casualty Business.
   
             "Business Software Rights" shall have the meaning
   provided in Section 5.27(d).
   
             "Business Transfer" shall mean the Affiliated Business
   Transfer, the COLI Business Transfer and the PPA Business Transfer,
   collectively.
   
             "Closing" shall mean the satisfaction of the conditions
   to and the sale and purchase of the Shares and the Note, as set
   forth in Article III hereof.
   
             "Closing Date" shall mean the date mutually agreed upon
   by the Parties on which Seller and Parent sell and Purchaser
   acquires the Shares and the Note, as set forth in Section 3.1.
   
             "Closing Date Financial Statements" shall have the
   meaning provided in Section 2.3(b).
   
             "Closing Date GAAP Statements" shall have the meaning
   provided in Section 2.3(b).
   
             "Closing Date Statutory Statements" shall have the
   meaning provided in Section 2.3(b).
   
             "Code" shall mean the Internal Revenue Code of 1986, as
   amended, and the regulations promulgated thereunder, as amended.
   
             "COLI Business" shall mean the business of initiating,
   selling and administering corporate owned life insurance products
   as heretofore undertaken and defined as such by the Company and its
   subsidiaries.
   
             "COLI Business Assets" shall mean the assets of the
   Company allocated to the COLI Business in the manner described in
   Annex B. 
   
             "COLI Business Liabilities" shall mean all of the
   liabilities and other obligations of the Company as described in
   Annex B and all other liabilities and other obligations of the
   Company that arise out of the COLI Business Assets and arising or
   relating to the COLI Business, regardless of whether such
   liabilities or obligations are primary or secondary, direct or
   indirect, absolute or contingent, contractual, tortious or
   otherwise.  
   
             "COLI Business Reinsurance Agreements" shall mean the
   reinsurance agreements among the Retained Subsidiaries and the
   Company entered into in accordance with Annex B.
   
             "COLI Business Transfer" shall mean the transfer of the
   COLI Business Assets to, and the reinsurance of the COLI Business
   by, the Retained Subsidiaries in accordance with Annex B.
   
             "Company" shall have the meaning provided in the
   recitals.
   
             "Computer Services Agreement" shall have the meaning
   provided in Section 7.12(a).
   
             "Contracts" shall mean every contract, agreement, lease,
   license, relationship and commitment, written and oral, to which
   the Company or any Subsidiary is a party, or by which any of them
   is bound, excluding (i) Investments and (ii) Reinsurance Treaties.
   
             "Conversion Date" shall have the meaning provided in
   Section 7.12(a).
   
             "Covered Employee" shall have the meaning provided in
        Section 8.4(a).
   
             "Director" shall mean each and any member of the
   Company's board of directors.
   
             "Disputed Amounts" shall have the meaning provided in
   Section 2.4.
   
             "Dispute Notice" shall have the meaning provided in
   Section 2.4.
   
             "Dispute Notice Date" shall have the meaning provided in
   Section 2.4.
   
             "Encumbrances" shall mean any and all liens, security
   interests, pledges, charges, claims, restrictions, limitations,
   options, or other encumbrances of any kind, character, or
   description, whether or not of record.
   
             "Environmental Laws" shall mean all federal, state, local
   and foreign laws, statutes, ordinances, rules, regulations,
   principles of common law, orders, decrees, judgments and
   injunctions, relating to pollution, the environment, public health
   and safety, natural resources, nuclear power production or
   Hazardous Substances.
   
             "ERISA" shall mean the Employee Retirement Income
   Security Act of 1974, as amended from time to time, and any
   regulations or published rulings promulgated or issued thereunder.
   
             "ERISA Affiliate" shall have the meaning provided in
   Section 5.17(a).
   
             "ERISA Affiliate Title IV Plans" shall have the meaning
   provided in Section 5.17(b).
   
             "Evaluation Materials" shall have the meaning provided in
   Section 5.24(b).
   
             "Exhibit Contracts" shall have the meaning provided in
   Section 5.14(b).
   
             "Final Arbiter" shall have the meaning provided in
   Section 2.4.
   
             "Financial Statements" shall mean the GAAP Financial
   Statements and Statutory Statements, collectively.
   
             "GAAP" shall mean generally accepted accounting
   principles consistently applied.
   
             "GAAP Financial Statements" shall have the meaning
   provided in Section 5.9.
   
             "GAAP Reserves" shall mean, as of any date, the reserves
   and liabilities established by the Company and the Acquired
   Subsidiaries for past and future insurance policy benefits, losses,
   claims, expenses and contingencies under insurance policies as
   determined in accordance with GAAP.
   
             "Hazardous Substances" shall mean any waste, pollutant,
   hazardous substance, toxic substance, hazardous waste, special
   waste, nuclear substance or waste, radioactive substance or waste,
   petroleum or petroleum-derived substance or waste, including any
   such substance, waste or constituent regulated under, or defined
   by, any Environmental Laws.
   
             "HFC" shall mean Household Finance Corporation, a
   Delaware corporation.
             
             "HI RIP" shall mean the Household International
   Retirement Income Plan. 
             
             "HI TRIP" shall mean the Household International Tax
   Reduction Investment Plan.
   
             "HSR Act" shall mean the Hart-Scott-Rodino Antitrust
   Improvements Act of 1976, as amended, and the rules and regulations
   promulgated thereunder.
   
             "Indemnified Costs" shall have the meaning specified in
        Section 11.2(a).
   
             "Indemnified Liability" shall mean any Indemnified Cost
   whether relating to events which shall have occurred prior to, or
   after the Closing Date, and relating to any of the matters
   described on Exhibit A or in Section 11.2.
   
             "Individual Business" shall mean the business of
   initiating, selling and administering individual and group
   insurance products, including universal life insurance, flexible
   premium deferred annuities, and other life insurance and annuity
   products as undertaken by the Company and the Acquired Subsidiaries
   and excluding the PPA Business, the COLI Business and the
   Affiliated Business.
   
             "Intercompany Agreements" shall have the meaning provided
   in Section 5.34.
   
             "Investments" shall mean any and all stocks, bonds or
   other securities, equity or proprietary interest in or loans (other
   than loans to policyholders) to an individual or to a corporation
   (other than the Acquired Subsidiaries), partnership, joint venture,
   business enterprise or other entity of any nature.
   
             "IRS" shall mean the United States Internal Revenue
   Service.
   
             "knowledge of the Alexander Hamilton Parties" shall mean
   knowledge of any executive officer of any of the Alexander Hamilton
   Parties.
   
             "Legal Fees" shall mean, with respect to any indemnified
   Person, any and all fees, costs, and expenses of any kind
   reasonably incurred by such Person or its counsel in investigating,
   preparing for, defending against or providing evidence, producing
   documents or taking other action with respect to any threatened or
   asserted claim.
   
             "Licensed Rights" shall have the meaning provided in
   Section 5.27(a).
   
             "Material Adverse Effect"  shall mean an event affecting
   (i) the Company or any of the Acquired Subsidiaries that is or
   would reasonably be expected to be materially adverse to the
   income, operations, financial condition, assets, liabilities or
   revenues, of the Company and the Acquired Subsidiaries, taken as a
   whole, or of First Alexander Hamilton Life Insurance Company, after
   giving effect to this Agreement and the transactions contemplated
   hereby or (ii) the ability of any of Seller, Parent or the Company
   to execute and deliver this Agreement and the Transaction Documents
   and to consummate the transactions and perform its obligations
   contemplated hereby and thereby.
   
             "Minimum Statutory Equity Amount" shall have the meaning
   provided in Section 2.3(e).
   
             "Note" shall have the meaning provided in the recitals.
   
             "Note Purchase Price" shall have the meaning provided in
   Section 2.2(b).
   
             "OSHA" shall mean the Occupational Safety and Health
   Administration.
   
             "Owned Software" shall have the meaning provided in
   Section 5.27(d).
   
             "Parent" shall have the meaning provided in the recitals.
   
             "Parent Guarantees" shall mean the Guarantees from Parent
   to Purchaser and the Company in the form of Exhibits B-1 to B-4
   hereto.
   
             "Parties" or "Party" shall mean either of Seller,
   Purchaser, Parent, or the Company or in the plural shall mean
   collectively, Seller, Purchaser, Parent, and the Company.
   
             "Patent and Trademark Rights" shall have the meaning
   provided in Section 5.27(a).
   
             "Person" shall mean an individual, a corporation, a
   partnership, an association, a joint-stock company, a trust, any
   unincorporated association or organization, or a government or
   political subdivision thereof.
   
             "PIC" shall mean Prospect Life Insurance Company, a stock
   life and disability insurance company to be organized pursuant to
   the Arizona Insurance Code.
   
             "Potential Tax Liability" shall have the meaning provided
   in Section 12.4(k).
   
             "PPA Business" shall mean the business of initiating,
   selling and administering periodic payment annuities as heretofore
   undertaken by the Company and its subsidiaries.
   
             "PPA Business Assets" shall mean the assets of the
   Company allocated to the PPA Business in the manner described in
   Annex C.
   
             "PPA Business Liabilities" shall mean all of the
   liabilities and other obligations of the Company as described in
   Annex C and all other liabilities and other obligations of the
   Company that arise out of the PPA Business Assets and arising or
   relating to the PPA Business, regardless of whether such
   liabilities or obligations are primary or secondary, direct or
   indirect, absolute or contingent, contractual, tortious or
   otherwise.
   
             "PPA Business Reinsurance Agreements" shall mean the
   reinsurance agreements among AHLIC-AZ or PIC and the Company
   entered into in accordance with Annex C.
   
             "PPA Business Transfer" shall mean the transfer of the
   PPA Business Assets to, and the reinsurance of the PPA Business by,
   the PPA Companies in accordance with Annex C.
   
             "PPA Companies" shall mean collectively, PIC and AHLIC-
   AZ.
   
             "Producers" shall mean all agents, brokers or others that
   have the authority to generate insurance business for the Company
   or any of its Subsidiaries, including the authority to bind the
   Company or a Subsidiary to any contract for insurance.
   
             "Producer Plans" shall have the meaning provided in
   Section 5.18(b).
   
             "Property and Casualty Business" shall mean the business
   of initiating and selling property and casualty insurance and
   workers' compensation insurance.
   
             "Purchase Price" shall have the meaning provided in
   Section 2.2(b).
   
             "Purchaser" shall have the meaning provided in the
   recitals.
   
             "Realized Capital Gains" shall mean an amount equal to
   *CONFIDENTIAL 1*
   
             "Related Party Contracts" shall mean Contracts involving
   an Affiliate of the Company as a party or otherwise.
   
             "Release" shall mean any release, spill, emission,
   leaking, pumping, injection, deposit, disposal, discharge,
   dispersal, leaching or migration into the indoor or outdoor
   environment or into or out of any property, including the movement
   of Hazardous Substances through or in the air, soil, surface water,
   ground water or property.
   
             "Reinsurance Treaties" shall mean all reinsurance
   treaties or agreements (including facultative agreements) under
   which the Company or any of its subsidiaries has ceded or assumed
   any liability or potential liability relating to its Business to a
   Person other than the Acquired Companies.
   
             "Relicensed Software Rights" shall have the meaning
   provided in Section 5.27(d).
   
             "Retained Subsidiaries" shall mean Hamilton National Life
   Insurance Company,  Alexander Hamilton Insurance Company of America
   and Alexander Hamilton Insurance Agency, Inc., each a Michigan
   corporation and wholly owned subsidiary of the Company.
   
             "Section 351 Transaction Structure" shall have the
   meaning provided in Section 12.4(m).
   
             "Section 338(h)(10) Elections" shall have the meaning
   provided in Section 12.4(b).
   
             "Securities Act" shall mean the United States Securities
   Act of 1933, as amended.
   
             "Seller" shall have the meaning provided in the recitals.
   
             "Sellers" shall mean together Parent and Seller.
   
             "Shares" shall mean the 375,000 issued and outstanding
   shares of common stock of the Company with a par value of $10.00
   per share, being all of the Company's issued and outstanding
   shares.
   
             "Share Purchase Price" shall have the meaning provided in
   Section 2.2(a).
   
             "Software Know-how" shall have the meaning provided in
   Section 5.27(d).
   
             "Statutory Accounting Principles" shall mean for any
   Person the statutory accounting principles and applicable actuarial
   standards of practice consistently applied in accordance with the
   rules and regulations of the National Association of Insurance
   Commissioners and the state of domicile of such Person.
   
             "Statutory Net Income" shall mean, for any period, net
   income of the Company and the Acquired Subsidiaries as reflected in
   a statement which has been prepared in conformity with Statutory
   Accounting Principles.
   
             "Statutory Reserves" shall mean, as of any date, the
   reserves and liabilities established by the Company and the
   Acquired Subsidiaries for past and future insurance policy
   benefits, losses, claims and expenses under insurance policies and
   any other reserve which is contemplated under applicable Statutory
   Accounting Principles.
   
             "Statutory Statements" shall have the meaning provided in
   Section 5.8.
   
             "Straddle Period" shall have the meaning provided in
   Section 12.5.
   
             "subsidiary" shall mean, for any Person, any entity in
   which such Person has an equity interest of 10% or more.
   
             "Tax" or "Taxes" shall mean all taxes and similar
   charges, fees, and levies imposed by any governmental authority,
   entity, or body, or subdivision thereof, whether based upon or
   measured by gross or net income or otherwise, including, without
   limitation, income, gross receipts, premiums, profits, sales, use,
   occupation, value added, ad valorem, transfer, franchise,
   withholding, payroll, employment, excise, or property taxes,
   together with any interest, toll charges, additions to tax, or
   penalties imposed with respect thereto.
   
             "Tax Benefit" shall have the meaning provided in
   Section 12.6.
   
             "Tax Dispute Accountants" shall have the meaning provided
   in Section 12.7.
   
             "Tax Returns" shall mean any return, declaration, report,
   claim for refund or information return or statement relating to
   Taxes, including any schedule or attachment to such documents and
   any amendment of such documents.
   
             "Transaction Documents" shall mean collectively the
   Transferred Business Reinsurance Agreements, the Computer Services
   Agreement, the Administrative Services Agreement, the Asset
   Allocation Agreement and the Parent Guarantees.
   
             "Transferred Assets" shall mean collectively, the PPA
   Business Assets, the COLI Business Assets and the Affiliated
   Business Assets. 
   
             "Transferred Business Reinsurance Agreements" shall mean
   collectively the PPA Business Reinsurance Agreements, the COLI
   Reinsurance Agreement and the Affiliated Business Reinsurance
   Agreements.
   
             "Transferred Liabilities" shall mean collectively the PPA
   Business Liabilities, the COLI Business Liabilities and the
   Affiliated Business Liabilities.
   
             "Twindex Policies" shall mean collectively the insurance
   (including annuity) products initiated or sold by the Business
   which include one or more endorsements referring to an interest
   crediting rate which cannot be less than the greater of a specified
   long-term rate and specified short-term rate, marketed under the
   name "Twindex."
   
        SECTION 1.2.  Other Terms
   
             Where used herein, and unless the content otherwise
   requires:
   
                  (i)  words importing the singular number or plural
             number shall include the plural number and singular
             number respectively;
   
                  (ii) words importing the masculine gender shall
             include the feminine and neuter genders and vice versa;
   
                  (iii)     reference to "Business Day" means a day on
             which banks are open for business in Chicago, Illinois,
             other than a Saturday or Sunday; 
   
                  (iv) reference to "include", "includes", and
             "including" shall be deemed to be followed by the phrase
             "without limitation;" and
   
                  (v)  reference in this Agreement to "herein,"
             "hereby" or "hereunder", or any similar formulation,
             shall be deemed to refer to this Agreement as a whole,
             including the Exhibits.
   
   
                              ARTICLE II.
                      PURCHASE AND SALE OF SHARES
   
        SECTION 2.1.  Transfer of Shares
   
             Upon the terms and subject to the conditions contained
   herein, and in reliance on the respective representations and
   warranties of the Parties, on the Closing Date, Seller and Parent
   as the case may be, will sell, convey, transfer, assign, and
   deliver to Purchaser, and Purchaser will purchase, the Shares from
   Seller for the Share Purchase Price, and the Note from Parent for
   the Note Purchase Price, in each case free and clear of all
   Encumbrances.
             
        SECTION 2.2.  Purchase Price
   
             The purchase price shall be the aggregate of all amounts
   set forth below: 
   
             (a)  to Seller for the Shares: $525,000,000 (the "Share
   Purchase Price"), subject to adjustment pursuant to Section 2.3. 
   
             (b)  to Parent for the Note: $50,000,000 (the "Note
   Purchase Price," and together with the Share Purchase Price, the
   "Purchase Price").
   
        SECTION 2.3.  Post-Closing Adjustment
   
             (a)  The Share Purchase Price shall be subject to
   adjustment after the Closing Date as specified in this Section 2.3.
        
             (b)  As soon as practicable, but in any event within 90
   calendar days following the Closing Date, the Company shall prepare
   and deliver to Parent, Seller and Purchaser the statements of
   assets, liabilities, surplus, and other funds and summary of
   operations and cash flows of the Company and each of the Acquired
   Subsidiaries as of, and for the period beginning January 1, 1995
   and ending on, the Closing Date (or the most recent end of a month
   if the Closing Date is not the last Business Day of a month) (the
   "Closing Date Statutory Statements"), which shall be prepared in
   conformity with Statutory Accounting Principles, and the
   consolidated balance sheets, statements of income, stockholder's
   equity and cash flows of the Company and the Acquired Subsidiaries
   as of and for the period beginning January 1, 1995 and ending on,
   the Closing Date (or the most recent end of a month if the Closing
   Date is not the last Business Day of a month), which shall be
   prepared in accordance with GAAP (the "Closing Date GAAP
   Statements" and collectively, the "Closing Date Financial
   Statements"), except that such Closing Date Financial Statements
   shall reflect an asset-by-asset recalculation in accordance with
   Statement of Financial Accounting Standards No. 91 and other
   applicable GAAP requirements as of the Closing Date (or the most
   recent end of a month if the Closing Date is not the last Business
   Day of a month) of the book value of all collateralized mortgage
   obligations held by any of the Acquired Companies.  The Closing
   Date Financial Statements shall present fairly, in all material
   respects, in accordance with Statutory Accounting Principles or
   GAAP, as the case may be, the financial position of the Company and
   the Acquired Subsidiaries (on a consolidated basis with respect to
   the Closing Date GAAP Statements) as of the end of such period, and
   the results of their operations for the periods specified and
   ending on the Closing Date (or the most recent end of a month if
   the Closing Date is not the last Business Day of a month).  The
   Company shall also deliver with such statements a calculation of
   Realized Capital Gains.
   
             (c)  Subsequent to the delivery of the Closing Date
   Financial Statements, Purchaser shall give Parent and its
   accountants, actuaries, counsel and other representatives
   reasonable access to the books and records of the Company and the
   Acquired Subsidiaries in order to make such investigations as it
   shall desire in conjunction with the evaluation by Parent of the
   Closing Date Financial Statements.  During such period, Purchaser
   shall permit Parent and its representatives to consult with the
   respective employees, auditors, actuaries, attorneys and agents of
   the Company and the Acquired Subsidiaries.
   
             (d)  The Closing Date Financial Statements shall be
   deemed final upon the earliest of the date on which Parent and
   Purchaser jointly agree that the Closing Date Financial Statements
   are final, the 31st day following the delivery of the Closing Date
   Financial Statements, if neither Parent nor Purchaser has notified
   the other of a dispute in amounts shown on the Closing Date
   Financial Statements and the date on which all disputes relating to
   such statements and calculations between Purchaser and Parent are
   resolved in accordance with Section 2.4.  
   
             (e)  On the fifth Business Day following the date on
   which the Closing Date Financial Statements are deemed final,
   Purchaser or Seller, as the case may be, shall pay to the other the
   amount, if any, that any payment to be received by such Person
   pursuant to this Section 2.3(e) exceeds any payment otherwise to be
   made by such Person pursuant to this Section 2.3(e) as follows: 
   Seller shall be obligated to pay to Purchaser, by wire transfer,
   together with interest on any such adjustment amount at an annual
   interest rate of *CONFIDENTIAL 2* (based upon a 365-day year) from
   the Closing Date to (but not including) the date of such payment,
   the amount, if any, that, after giving effect to the Business
   Transfer and the dividends and payments payable pursuant to
   Section 7.17 and without giving effect to any sale of the building
   contemplated by Section 7.15 (such building to be reflected in the
   Closing Date Statutory Statements at its historical book value
   notwithstanding its sale), the sum of the amount of the capital and
   surplus of the Company and the asset valuation reserve and interest
   maintenance reserve of each of the Acquired Companies, each as set
   forth in the Closing Date Statutory Statements, is less than
   *CONFIDENTIAL 3* (the "Minimum Statutory Equity Amount") and
   (ii) Purchaser shall be obligated to pay to Seller, by wire
   transfer, together with interest at an annual interest rate of
   *CONFIDENTIAL 3* (based upon a 365-day year) from the Closing Date
   to (but not including) the date of such payment, any dividend or
   interest payment allowable pursuant to Section 7.17 for which
   governmental approval has been timely applied for and not received
   prior to the Closing Date. 
   
        SECTION 2.4.  Dispute Resolution
   
             In the event that the Parties hereto do not agree to the
   determination of the Minimum Statutory Equity Amount pursuant to
   Section 2.3, or any other financial calculation (other than Tax
   matters) arising under the provisions of this Agreement (the
   "Disputed Amounts"), the disputing Party shall provide notice of
   such disagreement to the other Parties hereto (the "Dispute
   Notice", and the date of its delivery, the "Dispute Notice Date"). 
   The chief financial officer of Purchaser and the chief financial
   officer of Parent shall meet (by conference telephone call or in
   person at a mutually agreeable site) within one week after notice
   of a disagreement is given as provided above.  The chief financial
   officers shall attempt to make a final determination of the
   Disputed Amounts, and if the chief financial officers reach
   agreement, any payments shall be made within five days in
   accordance with such agreement.  If the chief financial officers do
   not reach agreement within a reasonable time, either or both of
   such chief financial officers shall give notice of an impasse, in
   which case the chief executive officer of Purchaser and the chief
   executive officer of Parent shall meet (by conference telephone
   call or in person at a mutually agreeable site) within one week
   after notice of an impasse is given by the chief financial
   officers.   If the chief executive officers have hereto not reached
   agreement as to the Disputed Amounts within a reasonable time,
   either chief executive officer may give notice of an impasse, and
   such determination shall be promptly submitted to a nationally
   recognized independent public accounting firm or a nationally
   recognized actuarial firm (an "Arbiter") jointly selected by Parent
   and Purchaser.  If Parent or Purchaser do not agree upon the joint
   selection of an Arbiter within five (5) Business Days following the
   notice of such impasse by the chief executive officers, either
   Parent or Purchaser may designate a proposed qualified Arbiter to
   the other by written notice.  Within five (5) Business Days such
   other Party shall either agree to the proposed qualified Arbiter or
   propose a different Arbiter and in the latter case the two Arbiters
   so proposed shall within five (5) Business Days thereafter select
   an Arbiter to make a final determination of the Disputed Amounts. 
   The Arbiter so selected by either Parent and Purchaser jointly or
   by the Arbiters (the "Final Arbiter") shall make its determination
   of the Disputed Amounts solely in accordance with the terms of this
   Agreement.  The Parties shall cooperate fully in assisting the
   Final Arbiter in calculating the Disputed Amounts and shall take
   such actions as necessary to expedite and to cause the Final
   Arbiter to expedite such calculation.  Each of Parent and Purchaser
   shall pay one-half of the total fees and expenses of the Final
   Arbiter.
   
   
                             ARTICLE III.
                               CLOSING 
   
        SECTION 3.1.  Time and Place of Closing
   
             (a)  Upon the terms and subject to the conditions
   contained in this Agreement, the Closing of the transactions
   contemplated by this Agreement will take place at the offices of
   Purchaser in Greensboro, North Carolina, at 9:00 a.m., Eastern
   time, on October 2, 1995 (the Closing on such date to be given
   effect as of September 30, 1995), or at such place, date and time
   as the Parties may mutually agree within 30 days of the date the
   conditions set forth in Article IX are satisfied or waived, but in
   no event later than December 31, 1995.
   
             (b)  If all of the conditions to Closing contained in
   this Agreement have been satisfied other than receipt of approval
   of the insurance department of the State of New York, the Parties
   agree to use their best efforts to effect a Closing promptly,
   including effecting a Closing prior to receipt of such approval,
   through the utilization of a trust or other arrangement to hold the
   capital stock of First Alexander Life Insurance Company; provided
   that no Party shall be required to take any action that would have
   a materially adverse effect on it or the Acquired Companies.
   
        SECTION 3.2.  Deliveries by Sellers
   
             At the Closing, Sellers will deliver the following to
   Purchaser:
   
             (a)  stock certificates representing the Shares,
   accompanied by stock powers duly executed in blank or duly executed
   instruments of transfer, and any other documents that are necessary
   to transfer to Purchaser good title to the Shares;
   
             (b)  the original Note with an assignment to Purchaser
   thereof;
   
             (c)  copies of the articles of incorporation and by-laws
   of each of Parent, Seller and the Acquired Companies;
   
             (d)  the stock books, stock ledgers, minute books, and
   corporate seals of the Acquired Companies and the stock
   certificates evidencing ownership of the Acquired Subsidiaries;
   
             (e)  the opinion, certificates, and other documents set
   forth in Section 9.3 of this Agreement; and
   
             (f)  resignations of such directors and officers of the
   Acquired Companies as are employees of Parent or HFC and such other
   directors or officers as Purchaser may request.
   
        SECTION 3.3.  Deliveries by Purchaser
   
             At the Closing, Purchaser will deliver the following:
   
             (a)  the Purchase Price, in immediately available funds,
   to such bank accounts of Seller and Parent as Parent designates in
   writing  to Purchaser.
   
             (b)  to Sellers, the opinion, certificates, and other
   documents set forth in Section 9.2 of this Agreement.
   
   
                              ARTICLE IV.
                          GUARANTEE BY PARENT
   
        SECTION 4.1.  Guarantee of Seller's Performance  
   
             Parent unconditionally and irrevocably guarantees to
   Purchaser the due and punctual performance of all of Seller's
   obligations set forth in this Agreement.
   
        SECTION 4.2.  Waiver  
   
             Parent waives (a) any right to require Purchaser to
   exhaust remedies against Seller, (b) notice of any modifications of
   this Agreement, (c) notice of any default under or breach of this
   Agreement, (d) demand and presentation for payment upon Seller,
   (e) protest, notice of protest and diligence of bringing suit
   against Seller, and (f) any other defenses available to Parent that
   are not available to Seller.
   
   
                              ARTICLE V.
   
                  REPRESENTATIONS AND WARRANTIES OF 
                           SELLER AND PARENT
   
        Seller and Parent jointly and severally represent and warrant
   to Purchaser as follows:
   
        SECTION 5.1.  Incorporation and Qualification; Subsidiaries
   
             (a)  Each of Parent, Seller, the Company and the Acquired
   Subsidiaries is a corporation duly incorporated, validly existing
   and in good standing, if applicable, under the laws of the
   jurisdiction of its incorporation and has all requisite corporate
   power and authority to own, lease and operate its properties and to
   carry on its business as now being conducted, and is duly qualified
   to do business and is in good standing, where applicable, in each
   jurisdiction in which the nature of its business or the ownership
   or leasing of its properties make such qualification necessary,
   except where the failure to be so qualified or in good standing
   would not have a Material Adverse Effect. 
   
             (b)  Attached hereto as Exhibit 5.1(b) is a complete and
   accurate list of all states and territories where the Company and
   each of the Acquired Subsidiaries has written or is qualified to
   write insurance, which list includes all jurisdictions in which
   failure to be so qualified, if qualification is required, would
   have a Material Adverse Effect; a list of all licenses and permits
   held by the Company and each of the Acquired Subsidiaries issued by
   any state insurance authority, and a description of the classes and
   lines of business the Company and each of the Acquired Subsidiaries
   is authorized to write in each jurisdiction.  Except as set forth
   in Exhibit 5.1(b), the Company's and each of the Acquired
   Subsidiaries' authority to write the classes and lines of insurance
   business reflected on said Exhibit is unrestricted and neither the
   Company nor any of the Acquired Subsidiaries is a party to any
   agreement, formal or informal, with any state insurance regulatory
   official limiting the Company's or such Acquired Subsidiary's
   ability to make full use of the licenses or permits which have been
   issued to it or requiring the Company and the Acquired Subsidiaries
   to comply with regulatory standards, procedures or requirements
   different from those applicable to companies with licenses or
   permits identical to those issued to the Company or such Acquired
   Subsidiary.  The licenses and permits listed on Exhibit 5.1(b)
   constitute all licenses and permits material to the conduct of
   Business, as it is now conducted and will be conducted prior to the
   Closing.  All such licenses and permits are in full force and
   effect and there are no reasonable grounds to believe that any such
   license or permit will not, in the ordinary course, be renewed upon
   its expiration.  Except as set forth on Exhibit 5.1(b), the Company
   and the Acquired Subsidiaries have not incurred fines or penalties
   in excess of $25,000 during the 36 month period prior to the date
   hereof and have filed all reports, paid all fees and taken all
   other actions under any applicable statute, rule or regulation by
   any state regulatory agency having jurisdiction over its activities
   which are required to comply in all material respects with all
   state insurance laws and regulations applicable to the Business. 
   Except as set forth in Exhibit 5.1(b), neither the Company nor any
   of the Acquired Subsidiaries has within the last five years (i) had
   any of its licenses or permits revoked or suspended, (ii) been
   involved in a proceeding or investigation, whether formal or
   informal, to revoke, suspend, limit or restrict such licenses or
   permits or (iii) been notified by any licensing authority that such
   authority might have cause to revoke, suspend, limit or restrict
   any such license or permit and to the best knowledge of the
   Alexander Hamilton Parties, no such suspension, revocation or
   limitation is threatened by any governmental authority or
   department.
   
             (c)  Attached hereto as Exhibit 5.1(c) is a complete and
   accurate list of all states and territories in which the Company or
   any Acquired Subsidiary currently has applications for licenses,
   permits or certificates of authority pending.  Exhibit 5.1(c) also
   sets forth the current status of all such applications.
   
             (d)  The Company and each Acquired Subsidiary belong to
   all state required rating bureaus, service organizations,
   insolvency funds, assigned risk pools and similar organizations
   necessary to conduct the Business as it is now being, and has been,
   conducted.
   
        SECTION 5.2.  Articles of Incorporation--By-Laws
   
             Sellers have delivered to Purchaser complete and correct
   copies of the articles or certificate of incorporation and all
   amendments thereto to the date hereof, and the by-laws, as amended
   to the date hereof, and any other governing documents (including
   stockholder agreements) of the Company and the Acquired
   Subsidiaries.  The minutes of the board of directors', any
   investment committees and stockholders' meetings and the stock
   books of the Company and the Acquired Subsidiaries, all of which
   have been previously made available to Purchaser, are the complete
   and correct records of such board of directors', investment
   committee's and stockholders' meetings and stock issuances through
   and including the date hereof and reflect all transactions through
   and including the date hereof required to be contained in such
   records, as well as those matters customarily contained in records
   of such type, and all such meetings were duly called.
   
        SECTION 5.3.  Acquired Subsidiaries
   
             All of the subsidiaries of the Company (other than the
   subsidiaries to be transferred pursuant to the Business Transfer)
   (the "Acquired Subsidiaries") are set forth in Exhibit 5.3 attached
   hereto.  The Company has no ownership interest, directly or
   indirectly, in any other Person, which is not shown on its Annual
   Statement as of December 31, 1994, as filed with Michigan
   Department of Insurance, except for such ownership interests that
   have been acquired as Investments for the Company and the Acquired
   Subsidiaries in the ordinary course of their business since
   December 31, 1994.  Except as set forth in Exhibit 5.3, the Company
   owns, directly or indirectly, all of the outstanding capital stock
   of each Acquired Subsidiary, free and clear of all Encumbrances,
   except such restrictions on transfer as may apply under applicable
   federal or state securities laws, the New York Insurance Code and
   any other state insurance code,  and all of such capital stock has
   been duly authorized and is validly issued, fully paid and
   nonassessable and was not issued in violation of any preemptive
   rights.  There are no outstanding options or rights to subscribe
   to, or any Contracts to issue or sell any shares of the capital
   stock or any securities or obligations convertible into or
   exchangeable for, or giving any Person any right to acquire, any
   shares of the capital stock or any other securities of any Acquired
   Subsidiary or any stock appreciation rights or similar rights
   relating to the capital stock of any Acquired Subsidiary.  Upon
   consummation of the transactions contemplated by this Agreement and
   the Transaction Documents, the Company will continue to own good
   and valid title to the stock of each Acquired Subsidiary, free and
   clear of all Encumbrances, except such restrictions on transfer as
   may apply under applicable federal or state securities laws, the
   New York Insurance Code and any other state insurance code.
   
        SECTION 5.4.  Scope of Business  
   
             Immediately prior to the consummation of the transactions
   contemplated by this Agreement and the Transaction Documents, the
   Company and the Acquired Subsidiaries will be involved in no other
   type of business activities except for the Business.
   
        SECTION 5.5.  Authorization
   
             Except for any regulatory or governmental consents or
   notices that may be required, Seller, Parent and the Company each
   have all necessary corporate power and authority to enter into this
   Agreement and the Transaction Documents and to perform them in
   accordance with their terms.  The execution and delivery of this
   Agreement and the Transaction Documents and the sale and other
   obligations contemplated hereby and thereby have been duly
   authorized by all requisite corporate action of Seller, Parent and
   the Company.  This Agreement has been, and each of the Transaction
   Documents will be, duly executed and delivered by each of these
   Parties, and will constitute valid and binding obligations of each
   of them, enforceable against such Parties, in accordance with the
   terms hereof and thereof and subject, as to the enforceability of
   remedies, to applicable bankruptcy, insolvency, reorganization,
   moratorium and similar laws of general applicability relating to or
   affecting creditors' rights and to general principles of equity.
   
        SECTION 5.6.  Capitalization  
   
             The duly authorized capital stock of the Company consists
   solely of 500,000 shares of Common Stock, par value $10.00 per
   share, 375,000 of which are issued and outstanding.  The Company
   has no other shares of capital stock of any class or other equity
   securities authorized, issued or outstanding, and there are no
   outstanding or authorized options, warrants, calls, subscriptions,
   rights, agreements or commitments of any character obligating the
   Company to issue any shares of its capital stock or securities
   convertible into or exchangeable for or evidencing the right to
   purchase or subscribe for any shares of its capital stock or the
   stock of any Acquired Subsidiary.  All of the Shares have been
   validly issued, fully paid and are nonassessable and free of
   preemptive rights.
   
        SECTION 5.7.  Ownership of Shares and Note  
   
             Seller is the beneficial and legal registered owner of
   all of the Shares and Parent is the beneficial and legal registered
   owner of the Note.  Each of Seller and Parent has good and valid
   title thereto and the right to sell, assign, and transfer the same
   to Purchaser free and clear of all Encumbrances except such
   restrictions as to further transfer that may apply under any
   applicable federal or state securities laws, the Michigan Insurance
   Code or any other state insurance code or insurance laws applicable
   to the Acquired Companies.  Upon delivery of the Shares and the
   Note to Purchaser at the Closing, Purchaser will acquire good and
   valid title thereto free and clear of any and all Encumbrances
   except such restrictions as to further transfer that may be imposed
   by federal or state securities laws, the Michigan Insurance Code or
   any other state insurance code or insurance laws applicable to the
   Acquired Companies.
   
        SECTION 5.8.  Statutory Statements  
   
             Seller previously made available to Purchaser a complete
   copy of the Annual Statements of the Company, and each of the
   Acquired Subsidiaries dated December 31, 1992, December 31, 1993
   and December 31, 1994, as filed with the department of insurance of
   such company's state of domicile, a complete copy of the Quarterly
   Statement of the Company and each of the Acquired Subsidiaries,
   dated March 31, 1995, as filed with the department of  insurance of
   such company's state of domicile, and will deliver as soon as they
   are filed such interim financial statements that may be required to
   be filed with any state departments of insurance prior to the
   Closing Date (collectively, the "Statutory Statements").  The
   Statutory Statements have been or will be prepared in accordance
   with Statutory Accounting Principles.  The Statutory Statements
   present (and such statements to be delivered hereafter will
   present)  fairly in all material respects in accordance with
   Statutory Accounting Principles the financial position of the
   company presented as of the dates indicated and the results of its
   operations for the periods therein specified.
   
        SECTION 5.9.  GAAP Financial Statements  
   
             Prior to the Closing Date Seller will deliver to
   Purchaser audited consolidated balance sheets of the Company and
   its subsidiaries at December 31, 1994 and 1993 and consolidated
   statements of income, cash flows and changes in stockholder's
   equity for the three years ended December 31, 1994, and the notes
   thereto, and has previously delivered the unaudited consolidated
   balance sheet of the Company and its subsidiaries as of March 31,
   1995, and consolidated statements of income for the three months
   ended March 31, 1994 and 1995, and will deliver on a timely basis
   interim financial statements as of the end of each subsequent
   quarter and for the quarter and year then ended, in each case
   prepared in accordance with GAAP (collectively, the "GAAP Financial
   Statements").  The GAAP Financial Statements present fairly or will
   present fairly in all material respects in accordance with GAAP the
   consolidated financial position of the Company and its subsidiaries
   as of the dates indicated and the results of their operations for
   the periods therein specified. 
   
        SECTION 5.10.  Investments; Defaults
   
             (a)  Seller has previously delivered to Purchaser a
   complete list of all Investments owned, directly or indirectly, by
   the Company and the Acquired Subsidiaries as of June 30, 1995. 
   Except as set forth on Exhibit 5.10(a)(1) (as updated for
   subsequent events), none of the Alexander Hamilton Parties has
   received notice of (i) any payment defaults with respect to any
   Investment or (ii) any other notice of nonperformance of any
   Investment. Exhibit 5.10(a)(1) also contains a list of all
   bankruptcies, nonperforming assets, foreclosures and payment
   defaults known to the Alexander Hamilton Parties with respect to
   the Investments as of June 30, 1995.  Except as disclosed on
   Exhibit 5.10(a)(2), all of the Investments constitute admitted
   assets on the Company's Statutory Statements and their carrying
   values have been described in conformity with Statutory Accounting
   Principles and in accordance with values prescribed by the National
   Association of Insurance Commissioners, when appropriate,
   consistent with the prior reporting practices of the Company and
   the Acquired Subsidiaries. 
   
             (b)  To the best knowledge of the Alexander Hamilton
   Parties, neither the Company nor any of the Acquired Subsidiaries
   has committed any act or omitted to take any act which would make
   any of the Investments not enforceable against the issuer thereof
   or the parties thereto in accordance with their terms, except that
   (i) such enforcement may be subject to bankruptcy, insolvency,
   reorganization, moratorium or other similar laws now or hereafter
   in effect relating to creditors' rights generally or the rights of
   creditors of insurance companies generally and (ii) the remedy of
   specific performance and injunctive and other forms of relief may
   be subject to equitable defenses and to the discretion of the court
   before which any proceeding therefor may be brought.
   
             (c)  Except as set forth on Exhibit 5.10(c), since
   December 31, 1994, none of the Company nor any Acquired Subsidiary
   has (i) purchased or otherwise invested in or committed to purchase
   or otherwise invest in any interest in real property (including,
   any extension of credit secured by a mortgage or deed of trust),
   (ii) purchased or otherwise invested in or committed to purchase or
   otherwise invest in securities which are below investment grade at
   the time of purchase, (iii) entered into any agreement or
   commitment with respect to the purchase or other acquisition, sale
   or other disposition or allocation of any Investment with any
   Affiliate or other entity in which an Affiliate owns an equity
   interest of more than 25% or (iv) entered into any agreement or
   commitment with respect to any foreign Investments.  For the
   purposes of this Section 5.10 the term "investment grade" shall
   mean with respect to any Investment which is an evidence of
   indebtedness, a rating of Baa3 or higher by Moody's Investors
   Service Inc., a rating of BBB- or higher by Standard &  Poor's
   Corporation or category 2 or higher by the National Association of
   Insurance Commissioners Securities Valuation Office.
   
        SECTION 5.11.  Twindex Policies
   
             Exhibit 5.11 sets forth a complete and accurate list of
   all insurance (including annuity) policy forms issued by the
   Company or any Acquired Subsidiary which constitute Twindex
   Policies, and the additional information shown on Exhibit 5.11 for
   such policies is accurate in all material respects.
   
        SECTION 5.12.  Reserves
   
             The GAAP Reserves and Statutory Reserves reflected in the
   Financial Statements were, or will be, computed in accordance with
   accepted actuarial standards as prescribed by the American Academy
   of Actuaries, are or will be fairly stated in accordance with sound
   actuarial principles, were, or will be, computed in a manner
   consistent with the computation of such items in the preceding
   corresponding period.
   
        SECTION 5.13.  Bank Accounts; Custodial Accounts; Receivables
   
             Prior to the Closing Date, other than petty cash accounts
   aggregating to less than $150,000, the Company will have delivered
   a true and complete list (in all material respects) and brief
   description (including the account or box number and the names of
   all Persons currently authorized to draw thereon, withdraw
   therefrom or have access thereto) of each and every bank account,
   safe deposit box, brokerage account, trust account, depository
   account or other custodial account of the Acquired Companies
   including, but not limited to, any deposits maintained with any
   governmental agency or department for the purpose of obtaining or
   continuing any authority within the subject jurisdiction or
   otherwise.  Other than the assets deposited in such accounts, the
   Acquired Companies have no other liquid assets or Investments held
   or maintained with any other Person at any location. 
   
        SECTION 5.14.  Material Contracts (Other Than Reinsurance)
   
             (a)  Each Contract to which the Company or any Acquired
   Subsidiary is a party or bound or to which it or its property is
   subject is listed on Exhibit 5.14, except for Contracts set forth
   or cross-referenced on Exhibits 5.10, 5.11, 5.16, 5.17, 5.18, 5.19,
   5.26, 5.27, 5.34 and 5.36 and except for Contracts:
   
                  (i)  Relating to insurance Contracts issued or to be
             issued in the ordinary course of business which involve
             annual premiums of less than $500,000;
   
                  (ii) For the purchase or rental of materials and
             supplies by the Company or any Acquired Subsidiary
             entered into in the ordinary and usual course of business
             which do not individually exceed $250,000 (treating each
             purchase order as a separate agreement); and 
   
                  (iii)     For the purchase of services by the
             Company or any Acquired Subsidiary entered into in the
             ordinary course of business which do not individually
             involve an amount in excess of $250,000 and which are
             reasonably expected to be fully performed within 12
             months of their respective dates.
   
             (b)  Except as set forth on Exhibit 5.14(b):
   
                  (i)  Neither the Company nor any Acquired Subsidiary
             has any outstanding Contract (other than for vested
             commissions or vested deferred compensation) with any
             Producer that is not cancelable by the Company or such
             Acquired Subsidiary, on notice of not longer than 60 days
             and without any expense, liability, penalty or premium of
             any kind in an amount greater than $25,000, or any
             Contract providing for the payment of any bonus or
             commission based on sales or earnings of any of the
             Acquired Companies; and
   
                  (ii) Neither the Company nor any Acquired Subsidiary
             is subject to any Contract containing covenants limiting
             the freedom of the Company or any Acquired Subsidiary to
             compete in any line of business in any geographic area,
             restricting or requiring any particular sales or other
             office location or requiring the Company to share any
             profits.
   
             (c)  To the best knowledge of the Alexander Hamilton
   Parties, all Contracts referred to, or required to be referred to,
   on any Exhibit delivered hereunder ("Exhibit Contracts") are valid
   and binding, and are in full force and effect and are enforceable
   in accordance with their terms, subject to the effect of any
   bankruptcy, insolvency, moratorium, or other similar laws affecting
   the enforcement of creditors' rights generally and except as the
   availability of equitable remedies may be limited by general
   principles of equity.  Except as described on Exhibit 5.14(b), the
   Alexander Hamilton Parties have no knowledge of any pending or
   threatened bankruptcy, insolvency or similar proceeding with
   respect to any party to such Exhibit Contracts.  Except as
   described on Exhibit 5.14(b), no event has occurred or state of
   facts exists which (whether with or without notice, lapse of time
   or the happening or occurrence of any other event) would constitute
   a default thereunder by the Company or any Acquired Subsidiary or,
   to the best knowledge of the Alexander Hamilton Parties, any other
   party thereto.  Each of the Company and the Acquired Subsidiaries
   has duly complied in all material respects with all provisions of
   every Exhibit Contract to which the Company or such Acquired
   Subsidiary is a party and is not in default as to any such
   Contract. 
   
             (d)  All outstanding insurance Contracts of the Company
   and the Acquired Subsidiaries were issued in conformity with the
   Company's underwriting standards and, with respect to such
   Contracts reinsured in whole or in part, conform to the standards
   agreed to with the reinsurer in the related reinsurance,
   coinsurance or other similar contracts.
   
        SECTION 5.15.  Reinsurance Treaties
   
             Except for the Transferred Business Reinsurance
   Agreements, Exhibit 5.15 lists all of the Reinsurance Treaties.
   Seller has provided to Purchaser copies of the Reinsurance Treaties
   which are true, accurate and complete, including all amendments or
   modifications thereto.  All Reinsurance Agreements are in full
   force and effect, enforceable in accordance with their terms, and,
   except as set forth in Exhibit 5.15, neither the Company nor, to
   the best knowledge of the Alexander Hamilton Parties, any other
   party to the Reinsurance Treaties is in default or alleged to be in
   default under the terms thereof, and there exists no condition
   which, after notice or lapse of time or both, would constitute a
   default thereunder.  Except as provided for in the Statutory
   Financial Statement as of and for the year ended December 31, 1994,
   or as disclosed in Exhibit 5.15 hereto, all reinsurance represented
   by the Reinsurance Treaties represents an admitted asset or
   reduction of loss reserves of the Company or an Acquired Subsidiary
   in the Statutory Statements and their carrying values have been
   described in conformity with Statutory Accounting Principles and in
   accordance with values prescribed by the National Association of
   Insurance Commissioners, when appropriate, consistent with the
   prior reporting practices of the Company and the Acquired
   Subsidiaries.  Except as set forth on Exhibit 5.15, no consent from
   any assuming reinsurer under any of the Reinsurance Treaties is
   required in order for Seller to validly and effectively sell the
   Shares to Purchaser as provided hereunder.  The consummation of the
   transactions contemplated by this Agreement will not affect any
   Acquired Company's rights under the Reinsurance Treaties and
   specifically (i) no Reinsurance Treaties will be terminable nor
   will any commutation or recapture thereunder be required as a
   result thereof and (ii) such consummation will not adversely affect
   an Acquired Company's recapture rights under such Reinsurance
   Treaties.  Recapture rights under the Reinsurance Treaties in
   connection with the increase in retention limits implemented in
   1995 under life insurance contracts are available and have not been
   diminished.
   
        SECTION 5.16.  Employees and Compensation
   
             (a)  Each of the Acquired Companies has complied
   materially with all applicable rules, laws and regulations
   concerning wages, bonuses, discrimination in employment,
   disabilities, family and medical leave, immigration, wrongful
   termination, worker's compensation for injury or sickness,
   collective bargaining, OSHA and other employment matters and made,
   in a timely manner, true, complete and accurate filings (in all
   material respects) required in connection therewith by any federal,
   state, local or Canadian governmental unit or agency.  Other than
   the HI RIP and the HI TRIP, no Acquired Company is liable to any
   former employee for any accrued wages or other benefits except as
   outlined in Section 5.17.  Each of the Acquired Companies has
   complied with all garnishment orders it has received and has made
   available all garnishment orders it has received in the last year
   to Purchaser.  Seller has previously delivered to Purchaser a list
   of all employees of the Acquired Companies whose annual salary is
   in excess of $75,000, including their current salary or rate of
   remuneration, any Contracts between each such employee and any
   Acquired Company and any special benefits or arrangements to which
   they are entitled, including any promised salary, wage or
   commission increase, other than non-qualified pension plans,
   welfare benefit plans or fringe benefits referred to in
   Exhibit 5.17.  Except as set forth in Exhibit 5.16, there are no
   employment Contracts with any employee of the Company or any
   Acquired Subsidiary and the employment of each employee of the
   Acquired Companies is terminable at will by the Acquired Companies
   without restriction, penalty or payment of any kind, other than
   payments with respect to liabilities reflected on the Financial
   Statements and for services actually performed, non-material
   payments for accrued benefits and the severance plan attached as
   Exhibit 8.4.  No employee of any Acquired Company has suffered an
   "employment loss" (as defined in the Worker Adjustment and
   Retraining Notification Act) within the 90 days prior to the date
   hereof or is anticipated to suffer an "employment loss" within the
   90 days prior to the Closing Date.
   
             (b)  Since December 31, 1994 no employee of an Acquired
   Company, or group of employees, the loss of whom would have a
   significant adverse effect on the Business, has notified any
   Acquired Company of his or their intent to (i) terminate his or
   their relationship with the Acquired Companies or (ii) make any
   demand for material payments or modifications of his or their
   arrangements with any Acquired Company.
   
             (c)  Except as set forth in Exhibit 5.16, the employees
   of the Acquired Companies are not represented by a labor
   organization, no Acquired Company is a signatory to a collective
   bargaining agreement with any labor organization, no union claims
   to represent any such employees and no union organizing effort is
   or within the last three years has been underway involving
   employees of any Acquired Company.
   
        SECTION 5.17.  Employee Benefit Plans
   
             (a)  Other than the HI RIP and the HI TRIP, Exhibit 5.17
   sets forth a complete list of each bonus, deferred compensation,
   incentive compensation, stock purchase, stock option, equity-based
   award, severance or termination pay, hospitalization or other
   medical, accident, disability, life or other insurance,
   supplemental unemployment benefits, fringe and other welfare
   benefit, profit-sharing, pension, or retirement plan, program,
   agreement or arrangement, and each other employee benefit plan,
   program, agreement or arrangement, sponsored, maintained or
   contributed to or required to be contributed to by the Acquired
   Companies or by any trade or business, whether or not incorporated,
   that together with the Acquired Companies would be deemed a "single
   employer" within the meaning of section 4001 of ERISA, or
   considered as being members of a controlled group of corporations,
   under common control, or members of an affiliated service group
   within the meaning of subsections 414(b), (c), (m) or (o) of the
   Code or Section 4001(a) (14) of ERISA (each such Subsidiary, trade,
   business or member an "ERISA Affiliate"), in each case for the
   benefit of any employee or former employee of the Acquired
   Companies (the "Benefit Plans").  Seller has previously furnished
   to Purchaser all of the written personnel policies, rules or
   procedures applicable to employees of any Acquired Company.
   
             (b)  Neither the Company nor any Acquired Subsidiary has
   (within the last six years prior to the date hereof) terminated or
   withdrawn from or sought a funding waiver with respect to, and no
   facts exist which could reasonably be expected to result in a
   termination or withdrawal from or seeking a funding waiver with
   respect to, any employee benefit plan which is subject to Title IV
   of ERISA other than the matters described in Exhibit 5.17(b). 
   Neither the Company nor any Acquired Subsidiary has incurred
   liability, and no facts exist which could reasonably be expected to
   result in such liability, as a result of a termination, withdrawal
   or funding waiver with respect to any plan, program or arrangement
   maintained for the benefit of the employees or former employees of
   an ERISA Affiliate (other than a Benefit Plan described in
   Section 5.17(a)) that is subject to Title IV of ERISA (an "ERISA
   Affiliate Title IV Plan").
   
             (c)  Seller has furnished to Purchaser (except as noted
   on Exhibit 5.17(c)) (i) a true, complete and current copy of
   (i) each written Benefit Plan, any amendments thereto and all
   trust, insurance or other funding agreements therefor and (ii) with
   respect to each Benefit Plan, all currently effective IRS,
   Department of Labor or Pension Benefit Guaranty Corporation rulings
   or determinations or rulings or determinations of any foreign
   government or agency, and the most recent annual reports, summary
   plan descriptions, actuarial reports and Statement of Financial
   Accounting Standards Nos. 87, 106 and 112 reports, (iii) a complete
   written description of each other Benefit Plan and (iv) such other
   documentation with respect to any Benefit Plan as has been
   reasonably requested by Purchaser.
   
             (d)  Based on the Towers Perrin report dated April 1995,
   the aggregate present value of the liability to the Company and the
   Acquired Subsidiaries to provide post-retirement medical benefits
   and life benefits is estimated at *CONFIDENTIAL 4* as of January 1,
   1995 and to provide long-term disability benefits to former and
   present employees of the Company and any of the Acquired
   Subsidiaries (and their dependents) is estimated to be
   *CONFIDENTIAL 4*.
   
             (e)  Each Benefit Plan and each ERISA Affiliate Title IV
   Plan has been established, maintained and administered in
   compliance in all material respects with all applicable laws,
   including applicable provisions of the laws of the United States
   and Canada.
   
             (f)  Neither the Company nor any Acquired Subsidiary has
   incurred, and no facts exist which are reasonably likely to result
   in, any liability to the Company or any Acquired Subsidiary for any
   tax or penalty with respect to any Benefit Plan, ERISA Affiliate
   Title IV Plan or any group health plan (as described in section
   5000 of the Code) of an ERISA Affiliate, including without
   limitation, any liability, tax or penalty under ERISA, the Code or
   Canadian law.
   
             (g)  The Company and each Acquired Subsidiary will have
   the right after the Closing Date under the terms of each Benefit
   Plan and under applicable law to terminate such plan or its
   participation in such plan at any time by action of the Company or
   the Acquired Subsidiary, and no additional contributions would be
   required in order to properly effect the termination of such plan
   or its participation in such plan in accordance with the terms of
   such plan and applicable law.
   
             (h)  Except as set forth on Exhibit 5.17(h), the
   consummation of the transactions contemplated by this Agreement
   will not, except as expressly provided in this Agreement, (i)
   entitle any current or former employee, director or officer of any
   Acquired Company to severance pay, unemployment compensation or any
   other payment or (ii) accelerate the time of payment or vesting or
   increase the amount of compensation due any such employee, director
   or officer.
   
             (i)  No Acquired Company makes or has made, nor has or
   has had an obligation to make, nor reimburses or has reimbursed,
   nor has or has had an obligation to reimburse, another employer,
   directly or indirectly, for making, contributions to a
   multiemployer plan as described in Title IV of ERISA.
   
             (j)  The HI RIP and the HI TRIP satisfy the qualification
   requirements of Section 401 (a) of the Code, each plan has received
   a favorable determination with  respect to its qualification under
   Section 401 (a) of the Code and any amendment made with respect to
   each such plan either is subject to such a favorable determination
   letter or a timely application for such a letter is pending with
   the IRS.  No audit or investigation by any domestic or foreign
   governmental or other law enforcement agency is pending or has been
   proposed with respect to either such plan except for the current
   audit of RIP by the U.S. Department of Labor.  No claims have been
   made or threatened by any person or governmental agency with
   respect to either such plan which claim could reasonably be
   expected to result in liability to the Company or an Acquired
   Subsidiary (other than routine and reasonable claims made in the
   ordinary course of plan operations).
   
        SECTION 5.18.  Producers for the Company
   
             (a)  Seller has previously delivered to Purchaser a
   complete and accurate list of the Producers for the Business who
   earned $100,000 or more in commission income from the Company or
   the Acquired Subsidiaries during 1994, including, with respect to
   each of the top 20 Producers, a brief description of the Producer's
   authority and the compensation and other terms of its relationship
   with the Company or the Acquired Subsidiary.  Seller has provided
   to Purchaser true, accurate and complete copies (in all material
   respects) of all agreements with such Producers, including all
   amendments or modifications thereof.
   
             (b)  The Company has previously furnished to Purchaser
   the forms of Contracts that govern the basic relationship between
   any of the Acquired Companies and personal producing general agents
   and agents.  Exhibit 5.18(b) sets forth a list of all other plans,
   programs and practices, whether written or oral, maintained or
   contributed to by the Company or any Acquired Subsidiary in effect
   as of the date hereof which presently provide or are reasonably
   likely to provide in the future benefits or compensation in excess
   of $100,000 to or on behalf of Producers or former Producers of the
   Company or any Acquired Subsidiary (excluding any promotional
   contests for Producers as to which the aggregate amounts payable
   thereunder do not exceed $100,000) ("Producer Plans"), copies of
   which have been previously furnished to Purchaser.  Except as set
   forth on Exhibit 5.18(b), each such Producer Plan may be terminated
   within 90 days of the giving of notice without any liability
   whatsoever to any Person whomsoever except payment to or on behalf
   of any Producers or former Producers (other than commissions
   accrued prior to such termination and vested renewals) of an amount
   less than or equal to $25,000 or, in the aggregate for all such
   Producers or former Producers, of an amount less than or equal to
   $250,000.
   
             (c)  To the best knowledge of the Alexander Hamilton
   Parties, there is no, and since December 31, 1994 there has not
   been any, condition or state of facts (excluding the transactions
   contemplated by this Agreement and external political and economic
   conditions) which is reasonably likely to affect the Company's and
   the Acquired Subsidiaries' relations with the Producers described
   on Exhibit 5.18(a) in a manner which would have a Material Adverse
   Effect, and no Producer or group of Producers, the loss of whom
   would have a Material Adverse Effect, has notified the Company or
   any Acquired Subsidiary since December 31, 1994 of his or their
   intent to (i) terminate his or their relationship with the Company
   or any Acquired Subsidiary or (ii) make any demand for material
   payments or modifications of his or their arrangements with the
   Company or any Acquired Subsidiary.
   
        SECTION 5.19.  Insurance
   
             Exhibit 5.19 contains a true and complete list of all
   policies currently in force relating to liability (including
   professional liability), theft, fidelity, fire and other casualty,
   life, accident and health, workers compensation, and any other form
   of insurance in force naming the Company, any Acquired Subsidiary
   or any employees thereof as an insured or beneficiary or as a loss
   payable payee and for which the Company or any Acquired Subsidiary
   has paid or is obligated to pay all or part of the premiums
   including the following information: (i) the name of the insurer,
   (ii) the amount of coverage and any retention or deductible, (iii)
   type of insurance coverage, (iv) insurance policy number, (v) any
   pending claims thereunder relating to the Company or any Acquired
   Subsidiary whether by the Company or otherwise (and the Company has
   disclosed to Purchaser all significant facts and circumstances
   known to the Alexander Hamilton Parties which may give rise to any
   claim) and (vi) the expiration date.  Except as set forth on
   Exhibit 5.19, neither the Company nor any Acquired Subsidiary has
   received notice of any pending or threatened cancellation or
   premium increase of more than 10% (retroactive or otherwise) with
   respect to any such policies referred to on Exhibit 5.19, and the
   Company and each Acquired Subsidiary is in compliance with all
   conditions contained therein.  The policies listed in Exhibit 5.19
   are in amounts which are adequate with respect to the operation of
   the Acquired Companies through the Closing Date.  Except as set
   forth on Exhibit 5.19, the limits of liability or amount of
   insurance under the policies listed in Exhibit 5.19 is not limited
   or subject to reduction or exhaustion due to claims made by or
   against any Person other than the Company or any Acquired
   Subsidiary.  Except as set forth on Exhibit 5.19, there are no
   pending claims against such insurance by the Company or any of the
   Acquired Subsidiaries as to which insurers are defending under
   reservation of rights or have denied liability, and there exists no
   claim under such insurance that has not been properly filed by the
   Company or the Acquired Subsidiaries.  The Company and each
   Acquired Subsidiary have been and are insured by reputable insurers
   with respect to their properties and the conduct of their business
   in such amounts and against such risks as are reasonable in
   relation to their business, and the Company will use its
   commercially reasonable best efforts to maintain such insurance in
   force at least through the Closing Date.
   
        SECTION 5.20.  Insurance Policy Forms and Rates
   
             Each insurance policy or certificate form, as well as any
   related application form, written advertising material and rate or
   rule currently in use by the Company or any Acquired Subsidiary,
   the use or issuance of which requires filing or approval, has been
   appropriately filed, and if required, approved by the Michigan
   Insurance Department or other applicable regulatory agencies.  All
   such policies and certificates, forms, applications, advertising
   materials and rates or rules are in compliance in all material
   respects with all applicable laws and regulations.
   
        SECTION 5.21.  Litigation and Regulatory Investigations
   
             (a)  The Company has delivered to Purchaser a Litigation
   Memorandum which sets forth all actions, suits, claims,
   investigations, unresolved regulatory inquiries or legal,
   administrative or arbitration proceedings pending or threatened
   which are known to the Alexander Hamilton Parties and which would
   involve a claim for an amount in excess of $100,000 in any single
   instance against or on behalf of the Company or any Acquired
   Subsidiary, or any officer, employee or director thereof in such
   individual's capacity as officer, employee or director of the
   Company or any Acquired Subsidiary or involving any of their
   properties or the Business, whether at law or in equity, before or
   by any federal, state, municipal or other governmental department,
   commission, board, bureau, agency or instrumentality, domestic or
   foreign, or any private party or entity and which indicates which
   of such matters are being defended by an insurance carrier, and
   which of the matters being so defended are being defended under a
   reservation of rights.  None of such matters (singly or in the
   aggregate) could reasonably be expected to result in a Material
   Adverse Effect.  Further, except as set forth in the Litigation
   Memorandum, there are no outstanding judgments, orders, decrees,
   stipulations or awards (whether rendered by a court, administrative
   agency, or by arbitration, pursuant to a grievance or other
   procedures) against or relating to the Company or any Acquired
   Subsidiary which contain any remaining restrictions or obligations
   to perform.  There is no pending or, to the best knowledge of the
   Alexander Hamilton Parties, threatened action, proceeding or
   investigation with respect to the Company, any Acquired Subsidiary
   or any other Person which questions the validity of this Agreement
   or the Transaction Documents or any transaction contemplated hereby
   or thereby, could prevent or materially adversely affect any action
   taken or to be taken pursuant hereto or thereto or which might
   result in any revocation, suspension or limitation of any
   regulatory authority of the Company or any Acquired Subsidiary or
   have a Material Adverse Effect, or which might result in any
   material liability of the Acquired Companies, taken as a whole.
   
             (b)  The Litigation Memorandum described in paragraph (a)
   above sets forth a description of all settlements for any action,
   suit, claim, investigation, regulatory inquiry or legal,
   administrative, arbitration or other proceeding involving any of
   the Acquired Companies during the 24 month period ending June 30,
   1995 and which resulted in a payment in full satisfaction thereof
   of more than $100,000.
   
        SECTION 5.22.  Compliance with Applicable Laws and Regulations
   
             Except as disclosed in Exhibit 5.22, each Acquired
   Company has complied in all material respects with its obligation
   to make each required filing or report with governmental or
   regulatory bodies and complied in all material respects with all
   laws, rules, regulations, licensing requirements and orders
   applicable to the Acquired Companies or the operation of the
   Business, and there has been no assertion by any party responsible
   for the administration or enforcement thereof that the Company or
   its Subsidiaries has violated any such laws, rules, regulations,
   requirements or  orders.  All filings and reports to governmental
   or regulatory authorities have been true, complete and accurate in
   all material respects.
   
        SECTION 5.23.  Brokers' or Finders' Fees
   
             Other than Morgan Stanley & Co. Incorporated (whose fees
   shall be paid solely by Parent), no agent, broker, investment
   banker, Person or firm acting on behalf or under the authority of
   Seller, Parent or its Affiliates or the Company is or will be
   entitled to any brokers' or finder' fee or any other commission or
   similar fee directly or indirectly from Purchaser or any Acquired
   Company in connection with any of the transactions contemplated by
   this Agreement.
   
        SECTION 5.24.  Full Disclosure; No Misrepresentations
   
             (a)  No information contained in the representations and
   warranties of Seller or Parent set forth in this Agreement, the
   Annex or in any of the certificates, schedules, lists, documents,
   exhibits or other instruments relating hereto or to be delivered or
   referenced as having previously been delivered to Purchaser
   hereunder contains any untrue statement of a material fact or omits
   to state a material fact necessary to make the statements contained
   herein or therein, in light of the circumstances under which they
   were made, not misleading.  There is no fact or condition known to
   Parent, Seller or the Company which has not been disclosed to
   Purchaser in writing which materially adversely affects or to the
   knowledge of any of the Alexander Hamilton Parties reasonably may
   be expected to materially adversely affect the business, assets,
   liabilities or financial condition of the Acquired Companies, taken
   as a whole.
   
             (b)  The Alexander Hamilton Parties have provided to
   Purchaser and its representatives certain documentation and
   information described on Exhibit 5.24(b) (the "Evaluation
   Materials").  To the best knowledge of the Alexander Hamilton
   Parties, the statements contained in Exhibit 5.24(b) are true and
   complete in all material respects.
   
        SECTION 5.25.  Dividends; Distributions on the Note
   
             (a)  Since December 31, 1994, other than the dividends
   permitted by this Agreement, the Company has not declared, set
   aside or paid any dividend payable in cash, stock or property or
   made any other distribution with respect to its capital stock. 
   Since December 31, 1994, none of the Company's subsidiaries has
   declared, set aside or paid any dividend payable in cash, stock or
   property or made any other distribution with respect to its capital
   stock.
   
             (b)  Other than the payment to Parent of *CONFIDENTIAL 5*
   in interest on the Note during 1995, the Company has not paid or
   set aside in a reserve any other payment on the Note.
   
        SECTION 5.26.  Property  
   
             (a)  Attached hereto as Exhibit 5.26(a) is a list of all
   the real property that the Company or any of the Acquired
   Subsidiaries will own as of the Closing Date.  As to such real
   property listed,
   
                  (i)  the identified owner has good and marketable
                       title to the parcel of real property, free and
                       clear of any Encumbrances, covenant or other
                       restriction except (A) as noted on the list 
                       therein and (B) for taxes not yet due,
                       recorded easements, covenants and other
                       restrictions, and utility easements, building
                       restrictions, zoning restrictions, and other
                       easements and restrictions existing generally
                       with respect to properties of a similar
                       character;
   
                  (ii) except as disclosed on Exhibit 5.26(a), there
                       are no leases, subleases, licenses,
                       concessions or other agreements granting to
                       any party or parties the right of use or
                       occupancy of any portion or the parcel of real
                       property; and
   
                 (iii) except as disclosed on Exhibit 5.26(a),
                       there are no outstanding options or
                       rights of first refusal to purchase the
                       parcel of real property, or any portion
                       or interest therein.
   
             (b)  The Company and each of its subsidiaries has good
   and marketable title or other rights to possess or use such of its
   personal property as is necessary to conduct its business as
   presently conducted, free and clear of all Encumbrances that could
   reasonably be expected to have a material adverse effect on the
   conduct the business of the Company and its subsidiaries, taken as
   a whole.
   
             (c)  Except with respect to personal property described
   in Section 5.27, all of the personal property necessary for the
   Company and each of its subsidiaries to conduct its business as
   presently conducted is under the possession or control of the
   Company.
   
             (d)  All real property leased by the Company and each of
   its subsidiaries is in good order, condition and repair, and the
   operations conducted on such real property comply with all
   applicable zoning and use restrictions except where the failure to
   be in such good order, condition, and repair, or to comply with
   such restrictions would not materially and adversely affect the
   Company's or its subsidiaries' ability to conduct the Business as
   such business is currently conducted.
   
             (e)  Except as set forth on Exhibit 5.26(e), the book
   value of the personal property (including all improvements on any
   real property owned by the Company or any Acquired Subsidiary and
   excluding all Investments and deposits) and leasehold improvements
   which are not located on the premises of the principal business
   operations of the Company or any Acquired Subsidiary does not
   exceed $250,000 in the aggregate.
   
             (f)  The structures and equipment owned by the Company or
   any Acquired Subsidiary and the structures and equipment leased by
   the Company or any Acquired Subsidiary, are structurally sound with
   no material defects, are in good and safe operating condition and
   repair and are adequate for the uses to which they are being put. 
   
        SECTION 5.27.  Patents and Trademarks; Technology
   
             (a)  Exhibit 5.27(a) sets forth a complete and accurate
   list and description of (i) all material United States and foreign
   patents, trademarks, trade names, service marks, copyrights and
   applications therefor owned by the Company or any Acquired
   Subsidiary (the "Patent and Trademark Rights") and (ii) all
   material United States and foreign patents, trademarks, trade
   names, service marks, copyrights and applications therefor,
   licensed to the Company or any Acquired Subsidiary (the "Licensed
   Rights").  Except as set forth on Exhibit 5.27(a), (i) the Patent
   and Trademark Rights are free of any Encumbrances, are not subject
   to any license (royalty-bearing or royalty-free) and are not
   subject to any other arrangement requiring any payment to any
   Person or the obligation to grant rights to any Person in exchange,
   (ii) the Licensed Rights are free and clear of any liens, claims,
   encumbrances, royalties or other obligations created by the Company
   or any Acquired Subsidiary and (iii) the Patent and Trademark
   Rights and the Licensed Rights are all those rights necessary to
   the Business as currently being conducted.  Except as set forth on
   Exhibit 5.27(a), the validity of the Patent and Trademark Rights
   and the validity of the Licensed Rights (i) have not been
   questioned in any prior litigation, (ii) are not being questioned
   in any pending litigation and (iii) to the best knowledge of the
   Alexander Hamilton Parties, are not the subject(s) of any
   threatened or proposed litigation.  Except as set forth on Exhibit
   5.27(a), the Business, as currently being conducted, does not
   conflict with and has not been alleged to conflict with any
   patents, trademarks, trade names, service marks, or copyright of
   others.  The consummation of the transactions contemplated by this
   Agreement and the Transaction Documents will not result in the loss
   or impairment of any of the Patent and Trademark Rights or any of
   the Licensed Rights or result in any requirement of new or
   additional royalty, licensing fees,  relicensing fees or other
   expenses.  Except as set forth on Exhibit 5.27(a), none of the
   Alexander Hamilton Parties knows of any use by others of the Patent
   and Trademark Rights or the Licensed Rights.
   
             (b)  The Company or an Acquired Subsidiary is the sole
   owner of the Patent and Trademark Rights and neither the Company
   nor any Acquired Subsidiary has previously assigned or granted and
   will not, prior to the Closing, grant to any Person any right,
   title or interest, option, or claim in respect of the Patent and
   Trademark Rights
   
             (c)  Neither the Company nor any Acquired Subsidiary in
   the conduct of the Business as currently conducted, infringes or
   wrongfully uses any confidential information, trade secrets,
   copyrights, letters, patent trade marks, service rights, trade
   names, designs, business names, or similar industrial, commercial
   or intellectual property rights.
   
             (d)  Exhibit 5.27(d) sets forth a list of certain
   computer software that (i) is used in connection with the Business
   (the "Business Software Rights") on the Closing Date, (ii) a subset
   of such Business Software Rights agreed to by the Parties which
   will be obtained for the Acquired Companies for the use with the
   Individual Business on the Conversion Date (the "Relicensed
   Software Rights") or (iii) has been internally created by or for
   the Company or an Acquired Subsidiary and which the Parent
   (including all affiliates thereof) will be granted a nonexclusive
   perpetual royalty-free license to use from Purchaser (the "Owned
   Software").  As of the Closing Date, the Company and each Acquired
   Subsidiary shall have access to and be entitled to use the Business
   Software Rights pursuant to a Computer Services Agreement as set
   forth in Section 7.12.  The Company and the Acquired Subsidiaries
   will possess rights to use all know-how and improvements relating
   to the Relicensed Software Rights ("Software Know-how") (whether
   developed by any of them or Parent or any Affiliate (other than the
   Acquired Companies)).  As of the Conversion Date, Company and each
   Acquired Subsidiary shall possess valid rights to use all
   Relicensed Software Rights, Owned Software or Software Know-how and
   such conversion will not result in the loss or impairment of any
   Relicensed Software Rights, Owned Software or Software Know-how to
   the Acquired Companies.
   
        SECTION 5.28.  Absence of Certain Changes or Events  
   
             Except (i) as set forth on Exhibit 5.28, (ii) for
   Contracts solely between or among the Company and any of the
   Acquired Subsidiaries in the ordinary course of business and
   consistent with past practice or (iii) as contemplated herein or in
   the Transaction Documents, neither the Company nor any of its
   subsidiaries has since December 31, 1994:
   
             (a)  Suffered any change in its financial condition or
   results of operations, policyholders' surplus, assets or
   liabilities, reserves, nature of its business or operations which
   change could reasonably be expected to, individually or in the
   aggregate, have a Material Adverse Effect;
   
             (b)  Incurred any liability or obligation (absolute,
   accrued, contingent or otherwise) except in the ordinary course of
   business and consistent with past practice, or suffered any
   material bad debt, contingency or other reserve increase (except
   insurance reserve increases resulting in the ordinary course of
   business);
   
             (c)  Made, declared or paid any dividend or made any
   distribution or payment, in respect of, or directly or indirectly
   redeemed, purchased or otherwise acquired, any shares of its
   outstanding capital stock, changed the number of shares of its
   authorized or issued capital stock, permitted shares of its capital
   stock held in treasury to become outstanding, or issued any capital
   stock or issued or granted any option, warrant, call, commitment,
   subscription, right to purchase or contract of any character
   relating to its authorized or issued capital stock or any
   securities convertible into, relating to or based on its capital
   stock.
   
             (d)  Paid, discharged or satisfied any claims,
   liabilities or obligations (absolute, accrued, contingent or
   otherwise), other than the payment, discharge or satisfaction in
   the ordinary course of business and consistent with past practice
   of liabilities and obligations reflected or reserved in the
   Statutory Statements or incurred in the ordinary course of business
   and consistent with past practice since December 31, 1994; 
   
             (e)  Permitted or allowed any of its property or assets
   (real, personal or mixed, tangible or intangible) to be subjected
   to any Encumbrance;
   
             (f)  Written off as uncollectible any notes or accounts
   receivable or any portion thereof, except such write-offs in the
   ordinary course of business and consistent with past practice which
   are not in excess of $250,000 in the aggregate;
   
             (g)  Written down the value of any asset or investment on
   its books or records, except for depreciation and amortization
   taken in the ordinary course of business and consistent with past
   practice;
   
             (h)  Canceled any debts or waived any claims or rights in
   excess of $250,000 in the aggregate, or sold, transferred or
   otherwise disposed of any of its properties or assets, except in
   transactions in the ordinary course of business and consistent with
   past practice and except pursuant to existing Reinsurance
   Agreements;
   
             (i)  Made aggregate capital expenditures and commitments
   in excess of $500,000 (on a consolidated basis) for additions to
   property or equipment;
   
             (j)  Paid, loaned or advanced (other than the payment of
   salaries or benefits or reimbursements of expenses in the ordinary
   course of business) any amount to, or sold, transferred or leased
   any properties or assets to, or entered into any Contract with, any
   of its officers or directors,  any Affiliate or associate of any of
   its officers or directors, or either Seller or any Affiliate of
   such Seller;
   
             (k)  Adopted or made any material change in any Benefit
   Plan;
   
             (l)  Taken or failed to take any action with respect to
   any Benefit Plan which would result in a failure to comply with
   applicable law or with Section 401 of the Code to the extent such
   Benefit Plan is intended to satisfy such section;
   
             (m)  Suffered any significant labor controversy or
   deterioration or loss in its agency force;
   
             (n)  Except for customary wage or salary increases for
   employees and  customary compensation increases for Producers,
   increased or announced any increase in the compensation payable or
   to become payable to any employee or Producer or increased or
   announced any increase in any bonus, insurance, pension or other
   Benefit Plan for such employees or Producers or entered into or
   amended any employment, consulting, severance or similar Contract,
   except for (i) at will employment arrangements and (ii) Contracts
   with Producers, in each case entered into or terminated, as the
   case may be, in the ordinary course of business consistent with
   past practice;
   
             (o)  Made any change in any accounting method, practice
   or principle or systems of internal accounting controls, or any
   change in any actuarial or reserving standard or any change in
   depreciation or amortization policies or rates adopted by it;
   
             (p)  Made any change in its underwriting standards,
   retention limits or administrative practices with respect to
   additions to (new business) or deletions from (policy terminations)
   any policy master files;
   
             (q)  Entered into any transaction other than in the
   ordinary course of business;
   
             (r)  Experienced any other event, development or
   condition of any character which has had or is reasonably likely to
   have a Material Adverse Effect; 
   
             (s)  Made any change in crediting rates, except changes
   generally comparable to those made by principal competitors or as
   agreed to by Purchaser; or 
   
             (t)  Agreed, whether in writing or otherwise, to take any
   action described in this Section 5.28.
   
        SECTION 5.29.  Agreement Does Not Violate Other Agreements
   
             Except as set forth on Exhibit 5.29, neither the
   execution, delivery, and performance by Parent, Seller or the
   Company of this Agreement and the Transaction Documents, nor the
   consummation of the transactions contemplated hereby and thereby,
   will (i) violate, conflict with, result in a breach of any
   provision of, constitute a default (or an event that, with notice
   or lapse of time or both, would constitute a default) under, result
   in the termination of, accelerate the performance required by, or
   result in a right of termination or acceleration, or the creation
   of any Encumbrance upon any of the properties or assets of Parent,
   Seller, the Company or any Acquired Subsidiary, under any of the
   terms, conditions, or provisions of (A) the articles of
   incorporation or by-laws of Seller, the Company, Parent or any
   Acquired Subsidiary or any shareholders' agreements relating to
   Parent, Seller, the Company or any Acquired Subsidiary or (B) any
   material commitment, mortgage, note, bond, indenture, contract,
   agreement, license or other instrument or obligation to which
   Seller, the Company, Parent or any of the Acquired Subsidiaries is
   a party, or by which the properties or assets of the Company or any
   of the Acquired Subsidiaries may be bound, except to the extent of
   the approvals described in Section 5.30, (ii) violate or conflict
   with any provision of any order, writ, injunction, statute, law,
   rule, regulation, permit or decree of any court, administrative
   agency or governmental body applicable to the Company or the
   Acquired Subsidiaries or (iii) alter or impair any permits,
   certificates, licenses, approvals and other authorizations required
   by the Company and the Acquired Subsidiaries to conduct the
   Business, except for states in which approval of the state
   insurance regulatory authority is required or in which the
   regulatory authority has discretionary authority to review the
   terms or effect of the transactions contemplated by this Agreement.
   
   
        SECTION 5.30.  Consents and Approvals
   
             Except as required by the HSR Act and other than
   consents, authorizations, approvals, or exemptions required under
   any applicable insurance and insurance holding company system
   statutes, no filing and no permit, authorization, consent or
   approval of any other Person is necessary for the execution and
   delivery of this Agreement and the Transaction Documents by the
   Alexander Hamilton Parties and the consummation by Parent, Seller
   or the Company of the transactions contemplated herein and therein;
   provided, however, that the Parties recognize that a Section 351
   Transaction Structure would require approval under insurance laws
   and regulations of the states in which business is conducted by the
   Company, as well as the regulatory clearances contemplated in
   Section 12.4(m).
   
        SECTION 5.31.  Environmental Matters
   
             Except as set forth on Exhibit 5.31:
   
             (a)  The Company and the Acquired Subsidiaries have
   obtained all permits, licenses and other authorizations and filed
   all notices which are required to be obtained or filed by any
   applicable Environmental Laws.
   
             (b)  To the best knowledge of the Alexander Hamilton
   Parties, the Company and the Acquired Subsidiaries are in
   compliance in all material respects with all terms and conditions
   of such required permits, licenses and authorizations.
   
             (c)  To the best knowledge of the Alexander Hamilton
   Parties, the Company and the Acquired Subsidiaries are in
   compliance in all material respects with all Environmental Laws.
   
             (d)  To the best knowledge of the Alexander Hamilton
   Parties, there are no past or present events, conditions,
   circumstances, activities, practices, incidents, actions or plans
   which may interfere with or prevent continued compliance, or which
   may give rise to any common law or statutory liability, or
   otherwise form the basis of any claim, action, suit, proceeding,
   earning or investigation, based on or related to the manufacture,
   processing, distribution, use, treatment, storage, disposal,
   transport, or handling, or the Release or threatened Release of
   Hazardous Substances with respect to the Company, any Acquired
   Subsidiary, the Business or any property, owned, leased or operated
   by the Company or the Acquired Subsidiaries.
   
             (e)  With regard to any properties owned, leased or
   operated by the Company or the Acquired Subsidiaries, to the best
   knowledge of the Alexander Hamilton Parties:
   
              (i) There has been no Release or threatened Release of
                  Hazardous Substances in violation of Environmental
                  Laws or in quantities that reasonably could result
                  in liability to the Company or the Acquired
                  Subsidiaries.
   
             (ii) They are not subject to a Encumbrance pursuant to
                  Environmental Laws.
   
            (iii) There is not now and has not been, on, in or
                  at such properties, owned or leased by the
                  Company or any Acquired Subsidiary any
                  underground storage tanks; surface
                  impoundment, lagoon or other similar, land-
                  based containment facility for the temporary
                  or permanent storage, treatment or disposal of
                  Hazardous Substances; landfill or solid waste
                  disposal area; polychlorinated biphenyls; or
                  asbestos or asbestos-containing materials. 
   
             (iv) They are in compliance in all material
                  respects with all Environmental Laws.
   
             (f)  The Alexander Hamilton Parties have made available
   to Purchaser all material information known to the Alexander
   Hamilton Parties regarding potential claims against the Company or
   the Acquired Subsidiaries under Environmental Laws with respect to
   the properties underlying mortgage loan Investments and properties
   owned, leased or operated by the Company or the Acquired
   Subsidiaries.
   
             (g)  Neither the Alexander Hamilton Parties nor, to their
   knowledge any past owner, operator, or occupant of the properties,
   now or in the past, owned, leased or operated by the Company and
   the Acquired Subsidiaries has received any claim or notification,
   either direct or indirect, pursuant to Environmental Laws that such
   properties (i) are or may be subject to any investigation or
   evaluation by any Person, (ii) that the Company or the Acquired
   Subsidiaries are or may be liable for cleaning up Hazardous
   Substances on, under, in or migrating from such properties and
   (iii) that Hazardous Substances are or may be migrating onto or
   under such properties.
   
             (h)  The Alexander Hamilton Parties have not received any
   claim or notice, either direct or indirect by a Person asserting
   that the Company or the Acquired Subsidiaries are or may be liable
   for personal injury or property damage arising under Environmental
   Laws.
   
        SECTION 5.32.  Liabilities
   
             Except as and to the extent reflected and adequately
   reserved against in the consolidated balance sheet of the Company
   and its subsidiaries of December 31, 1994 or referenced in any
   other Exhibit hereto, neither the Company nor any of the Acquired
   Subsidiaries has any material liability or obligation (direct or
   indirect, contingent or absolute, asserted or unasserted) of any
   nature other than liabilities or obligations (i) shown on and
   reserved for on the last Financial Statements or notes thereto,
   (ii) incurred by the Company or any of the Acquired Subsidiaries in
   the ordinary course of its business since the most recent Financial
   Statements that has not had and will not have a Material Adverse
   Effect or (iii) incurred in connection with the transactions
   contemplated by this Agreement or otherwise governed by the
   Transaction Documents; provided, however, that this representation
   and warranty shall not extend to any liability arising as a result
   of events or circumstances occurring after the Closing Date or from
   any amendment, modification, interpretation, or other change in any
   statute, regulation, ruling, or accounting standard applicable
   generally to Persons engaged in activities similar to those of the
   Company or the Acquired Subsidiaries.
   
        SECTION 5.33.  Disclaimer
   
             Except as specifically set forth herein, Seller and
   Parent make no other representation or warranty, express or
   implied, as to the Acquired Companies' financial condition,
   business, assets, liabilities, operations, or prospects, and no
   Person has been authorized by Seller or Parent to make any
   representation or warranty except as specifically set forth in this
   Agreement.
   
        SECTION 5.34.  Related Party Agreements
   
             Except for the Note, and the Contracts, Tax sharing
   agreements, and affiliated investments and commitments (together
   the "Intercompany Agreements") listed on Exhibit 5.34 and except
   for agreements solely between or among the Company and the Acquired
   Subsidiaries, there are no outstanding Contracts between Parent,
   Seller or any of their Affiliates, on the one hand, and the Company
   or any Acquired Subsidiary, on the other hand, and none of Parent,
   Seller or any of their Affiliates nor any officer or director
   thereof has any other claim, cause of action or rights (whether
   contractual or otherwise) against the Company or any Acquired
   Subsidiary or any predecessor in interest, other than as
   contemplated by this Agreement.  Except as set forth on
   Exhibit 5.34, there are no Contracts of the Company or any Acquired
   Subsidiary with any director or officer of Parent, any Affiliate of
   Parent, the Company or any Acquired Subsidiary, or with any Person
   related to any such Person or with any company or other
   organization in which any director or officer of Parent, any
   Affiliate of Parent, the Company or any Acquired Subsidiary, or
   anyone related to any Person, has a direct or indirect financial
   interest.
   
        SECTION 5.35.  Policy Information
   
             The information furnished to Purchaser and its
   representatives as set forth in Exhibit 5.35 is accurate in all
   material respects.
   
        SECTION 5.36.  COLI Agreements
   
             Exhibit 5.36 lists all of the Contracts issued or to be
   issued by the COLI Business, and the Company previously has
   delivered to Purchaser copies of all such Contracts, including all
   outstanding agreements, undertakings, commitments or obligations to
   provide insurance, whether or not in the ordinary course of
   business.
   
        SECTION 5.37.  Certain Business Practices
   
             Except as set forth on Exhibit 5.37:
   
             (a)  All insurance or annuity benefits that have become
   payable and not subject to a bona fide dispute by the Company or
   any Acquired Subsidiary, and are not in the course of settlement in
   good faith by such Person, have been paid, or provided for, in
   accordance with the terms of the insurance, annuity or other
   similar contract or agreement under which they arose;
   
             (b)  No outstanding insurance policy or annuity contract
   issued, reinsured or underwritten by the Company or any Acquired
   Subsidiary entitles any Person to receive dividends, distributions
   or other benefits based on the revenues or earnings of the contract
   issuer; 
   
             (c)  The underwriting standards utilized and ratings
   applied by the Company or any Acquired Subsidiary with regard to
   insurance products currently offered by such Person conform in all
   material respects to industry accepted practices; and
   
             (d)  No Producer currently has, and no Producer has had
   in the past, any authority to make underwriting decisions with
   respect to insurance policies issued by the Company or any Acquired
   Subsidiary, as the case may be.
   
   
                              ARTICLE VI.
              REPRESENTATIONS AND WARRANTIES OF PURCHASER
   
        Purchaser hereby represents and warrants to Seller and Parent
   as follows:
   
        SECTION 6.1.  Organization and Standing  
   
             Purchaser is a corporation duly incorporated, validly
   existing and in good standing under the laws of the State of North
   Carolina.
   
        SECTION 6.2.  Authority  
   
             Except for any regulatory or governmental consents that
   may be required, Purchaser has all necessary corporate power and
   authority to enter into this Agreement and all other agreements
   contemplated hereunder and to perform the obligations to be
   performed by it hereunder and thereunder.  The execution and
   delivery of this Agreement and the purchase and other obligations
   contemplated hereby have been duly authorized by all requisite
   corporate action of Purchaser.  This Agreement has been, and any
   other agreements executed by Purchaser pursuant to this Agreement
   will on the Closing Date be, duly executed and delivered by
   Purchaser and constitute valid and binding obligations of
   Purchaser, enforceable against Purchaser in accordance with the
   terms hereof and thereof, subject, as to enforceability of
   remedies, to applicable bankruptcy, insolvency, reorganization,
   moratorium and similar laws of general applicability relating to or
   affecting creditors' rights and to general principles of equity.
   
        SECTION 6.3.  Investment Representation  
   
             Purchaser acknowledges that the Shares and the Note are
   not registered under the securities laws of any jurisdiction and
   that it is acquiring the Shares and the Note for its own account,
   and not with a view to the distribution thereof.  Purchaser is a
   sophisticated investor with knowledge and experience in financial
   matters and has received information from Seller concerning the
   Company and has had the opportunity to obtain additional
   information in order to evaluate the purchase contemplated hereby. 
   Purchaser is purchasing the Shares and the Note for investment
   purposes and not with the intention of reselling or distributing
   the Shares; provided, however, that the foregoing representation
   shall in no way limit Purchaser's right to dispose of all or any
   portion of the Shares or the Note, at any time, at Purchaser's sole
   discretion.
   
        SECTION 6.4.  Consents and Approvals  
   
             Except as set forth on Exhibit 6.4 and as required by the
   HSR Act and other than consents, authorizations, approvals, or
   exemptions required under any applicable insurance holding company
   system statutes in the States of Arizona, Michigan, New York and
   North Carolina, no filing and no permit, authorization, consent or
   approval of any other Person is necessary for the execution and
   delivery of this Agreement and the Transaction Documents by
   Purchaser and the consummation by Purchaser of the transactions
   contemplated herein and therein.
   
        SECTION 6.5.  No Conflict or Violation  
   
             The execution, delivery and performance by Purchaser of
   this Agreement and the Transaction Documents and the consummation
   of the transactions contemplated hereby and thereby will not (i)
   violate, conflict with, result in a breach of any provision of,
   constitute a default (or an event that, with notice or lapse of
   time or both, would constitute a default), result in the
   termination of, accelerate the performance required by, or result
   in a right of termination or acceleration, or the creation of any
   Encumbrance upon any of the properties or assets of Purchaser,
   under any of the terms, conditions or provisions of (A) the
   articles of incorporation or by-laws of Purchaser or any
   shareholders' agreements relating to Purchaser or (B) any material
   commitment, mortgage, note, bond, indenture, contract, agreement,
   license or other instrument or obligation to which Purchaser is a
   party, or by which Purchaser may be bound, (ii) violate or conflict
   with any provision of any order, writ, injunction, statute, law,
   rule, regulation, permit or decree of any court, administrative
   agency or governmental body applicable to Purchaser or (iii) alter
   or impair any permits, certificates, licenses, approvals and other
   authorizations required by Purchaser to conduct the Business,
   except for states in which approval from the state insurance
   regulatory authority is required or in which the regulatory
   authority has discretionary authority to review the terms or effect
   of the transactions contemplated by this Agreement.
   
        SECTION 6.6.  Financial Ability  
   
             Purchaser is financially capable and has sufficient cash
   and other resources available to complete the transactions
   contemplated by this Agreement.
   
        SECTION 6.7.  Litigation  
   
             There are no claims, actions, suits, proceedings or
   investigations pending, or to the knowledge of any executive
   officer of Purchaser, threatened or contemplated, against or
   affecting Purchaser or any of its property or other rights which
   would impair in any manner the ability of Purchaser to perform its
   obligations hereunder, or against the transactions contemplated by
   this Agreement, at law or in equity, before any court or other
   governmental agency or instrumentality, domestic or foreign, or any
   other body, and to the knowledge of any executive officer of
   Purchaser, there is no basis for any such claim, action, suit,
   proceeding or investigation, including without limitation, any such
   claim, action, suit, proceeding or investigation relating to,
   arising out of, or based upon any proceedings by an insurance
   regulatory authority.
   
        SECTION 6.8.  Brokers  
   
             Other than Goldman, Sachs & Co. (whose fees shall be paid
   solely by Purchaser),  no broker, agent, investment banker, Person
   or firm acting on behalf or under the authority of Purchaser or its
   Affiliates is or will be entitled to any brokers' or finder fee or
   any commission or similar fee directly or indirectly from any
   Alexander Hamilton Party in connection with any of  the
   transactions contemplated by this Agreement.
   
   
                             ARTICLE VII.
                 CONDUCT AND TRANSACTIONS PRIOR TO THE
   CLOSING DATE; CERTAIN COVENANTS
   
             The Alexander Hamilton Parties covenant that between the
   date of this Agreement and the Closing Date:
   
        SECTION 7.1.  Maintenance of Business; Certain Transactions
   
             Except to the extent that Purchaser shall otherwise
   consent in writing and except as contemplated by this Agreement,
   the Company and its subsidiaries will operate the Business as
   currently conducted and only in the ordinary course.  In addition,
   Sellers and the Company agree that from the date hereof to the
   Closing Date, and except as expressly authorized under this
   Agreement and the Transaction Documents or as otherwise consented
   to by Purchaser in writing, neither the Company nor any of its
   subsidiaries will:
   
             (a)  Take any action which would result in any
   representation or warranty contained in Article V no longer being
   true and correct in all material respects as if such
   representations or warranty were made on the date thereof;
   
             (b)  Enter into or amend in any material respect any
   Contract (other than insurance Contracts in the ordinary course of
   business consistent with past practice) involving more than
   $100,000 over its noncancellable term or enter into any Contract
   (other than insurance Contracts in the ordinary course of business
   consistent with past practice) involving an amount in excess of
   $100,000 which is not cancelable on 30 days' notice without
   penalty;
   
             (c)  Other than in the ordinary course or to protect the
   business, enter into or amend or cancel or agree to the amendment
   or cancellation of any insurance Contract or other agreement or
   undertaking relating to the COLI Business;
   
             (d)  Issue any periodic payment annuities in respect of
   lotteries or structured settlements;
   
             (e)  Take any action to amend or terminate any Benefit
   Plan or adopt any other plan, program, Contract or practice
   providing benefits for or compensation to or on behalf of employees
   or former employees of the Company or any Acquired Subsidiary, or
   permit any Affiliate of the Company to take any such action if such
   action could subject the Company or any Acquired Subsidiary to an
   obligation or liability in excess of $10,000 with respect to an
   individual employee or former employee or $100,000 in the
   aggregate;
   
             (f)  Change any provision of its articles of
   incorporation or by-laws or similar governing documents;
   
             (g)  Make, declare or pay any dividend or make any
   distribution or payment in respect of or directly or indirectly
   redeem, purchase or otherwise acquire, any shares of its
   outstanding capital stock or the Note, change the number of shares
   of its authorized or issued capital stock, permit any shares of its
   capital stock held in treasury to become outstanding, or issue any
   capital stock or issue or grant any option, warrant, call,
   commitment, subscription, right to purchase or Contract of any
   character relating to its authorized or issued capital stock or any
   securities convertible into, relating to or based on shares of such
   stock; 
   
             (h)  Other than in connection with the development and
   marketing of the insurance product to be sold under the name
   "Allegiance Variable Annuity," undertake any other new product
   introduction;
   
             (i)  Except in the ordinary course of business, make any
   loans or advances to any other Person; 
   
             (j)  Pay, discharge or satisfy any claims, liabilities or
   obligations (absolute, accrued, contingent or otherwise), other
   than payments in the ordinary course of business consistent with
   past practice;
   
             (k)  Purchase, sell or distribute any real or personal
   property or purchase or sell any options to purchase or sell any
   real or personal property, with a market value in excess of
   $100,000 in the aggregate; 
   
             (l)  Permit any insurance policy naming it as a
   beneficiary or a loss payable payee to be canceled or terminated or
   any of the coverage thereunder to lapse unless (i) simultaneously
   with such termination or cancellation substantially similar
   replacement policies reasonably satisfactory to Purchaser are in
   full force and effect or (ii) the cost of renewal is commercially
   unreasonable;
   
             (m)  Enter into or amend or cancel or agree to the
   amendment or cancellation of any reinsurance agreement, treaty or
   arrangement;
   
             (n)  Make any investment of a capital nature either by
   purchase of stock or securities, contributions to capital, property
   transfers or otherwise, or by the purchase of any property or
   assets of any other individual, firm or corporation, except for
   portfolio transactions and Investments in the ordinary course of
   business consistent with past practice;
   
             (o)  Engage in any other transaction or series of related
   transactions (not otherwise referred to in this Section 7.1)
   involving an amount in excess of $100,000;
   
             (p)  Amend or agree to the amendment of any form of
   Producer Contract that is provided on Exhibit 5.18(b) hereof; or
   
             (q)  Enter into a Contract to do any of the things
   described in clauses (a) through (p) above.
   
        SECTION 7.2.  Reports
   
             The Company shall from time to time furnish to Purchaser,
   promptly following the receipt by senior management of the Company,
   (i) copies of all monthly management reports prepared for senior
   management of the Company, (ii) copies of all monthly financial
   statements and reports, (iii) monthly updates of Exhibit 5.10 and
   (iv) a copy of any report filed with any insurance regulatory
   authority, which in each such case, shall be prepared in a manner
   consistent with past practice.
   
        SECTION 7.3.  Corporate Existence
   
             (a)  Except as provided by this Agreement, the Company
   and each of its subsidiaries will use best efforts to preserve its
   respective business organization and goodwill intact, preserve and
   maintain its licenses, keep available the services of its current
   officers and key employees, and maintain satisfactory relationships
   with Producers, licensors, licensees, agents, suppliers,
   contractors, regulators, distributors, policyholders, customers and
   others with whom business relationships exist with the Company or
   such Subsidiary.
   
             (b)  The Company and each of its Subsidiaries will 
   
                  (i)  maintain its respective corporate existence; 
   
                  (ii) pay or reserve all Taxes, charges and
             assessments as reflected on any government filing on a
             timely basis unless the same are being contested and
             adequate reserves therefor have been established on the
             Company's or such subsidiary's books; 
   
                 (iii) make all debt service payments when
             contractually due and payable; and 
   
                  (iv) pay all accounts payable and other liabilities
             on a timely basis.
   
        SECTION 7.4.  Twindex Policies
   
             If requested by Purchaser and agreed by Seller, on or
   before the Closing Date, the Alexander Hamilton Parties will
   provide notice to all holders of Twindex Policies of an amendment
   of the existing reference rate provisions mutually agreeable to
   Purchaser, on the one hand, and the Alexander Hamilton Parties, on
   the other hand.
   
        SECTION 7.5.  Further Assurances
   
             Subject to the terms and conditions of this Agreement,
   the Alexander Hamilton Parties will use all reasonable efforts to
   take, or cause to be taken, all action, and to do, or cause to be
   done, all things reasonably necessary, proper, or advisable under
   applicable laws and regulations to consummate the transactions
   contemplated by this Agreement and to make effective the sale of
   the Shares and the Note pursuant to this Agreement.  From time to
   time after the Closing Date, without further consideration, the
   Alexander Hamilton Parties shall, at their own expense, execute and
   deliver such documents to Purchaser as Purchaser may reasonably
   request in order more effectively to vest in Purchaser good title
   to the Shares and the Note.
   
        SECTION 7.6.  Access
   
             The Alexander Hamilton Parties shall give to Purchaser
   and its accountants, actuaries, counsel and other representatives
   reasonable access throughout the period prior to the Closing Date
   to all of the properties, books, Contracts, commitments and records
   (including Tax Returns and insurance policies) of the Company and
   the Acquired Subsidiaries in order that Purchaser may have
   opportunity to make such investigations as it shall desire in
   conjunction with the transactions contemplated hereunder.  During
   such period, the Alexander Hamilton Parties shall permit Purchaser
   and its representatives to consult with the respective directors,
   officers, employees, auditors, actuaries, attorneys and agents of
   the Company and the Acquired Subsidiaries and, to the extent
   available, the Alexander Hamilton Parties will authorize and direct
   their respective officers, accountants and actuaries to furnish
   such additional financial and operating data and other information
   (including financial statements and other information and consents
   required in connection with any registration statement that may be
   filed by Purchaser which is required to include financial
   information concerning the Acquired Companies) as Purchaser shall
   from time to time reasonably request.
   
        SECTION 7.7.  Consents
   
             Seller, Parent and the Company will use their best
   efforts to obtain all consents of, and provide all notices to,
   other Persons required for Seller, Parent or the Company to
   authorize, approve or permit the sale of  the Shares and the Note
   and the consummation of the transactions contemplated by this
   Agreement and the Transaction Documents, if any such consents or
   notices are required.  Without limiting the generality of the
   foregoing, Seller and the Company shall use their best efforts to
   satisfy or cause to be satisfied all the conditions to the
   obligations of Seller set forth in Sections 9.1 and 9.3.
   
        SECTION   Notification of Certain Matters
   
             Seller, Parent and the Company shall give prompt notice
   to Purchaser of (i) the occurrence, or failure to occur, of any
   event which occurrence or failure would be likely to cause any
   representation or warranty contained in this Agreement to be untrue
   or inaccurate at any time from the date of this Agreement to the
   Closing Date and (ii) any material failure of Seller or Parent to
   comply with or satisfy any covenant, condition or agreement to be
   complied with or satisfied by it hereunder.
   
        SECTION 7.9.  Performance
   
             (i)  Seller and Parent shall perform all acts to be
   performed by it prior to the Closing pursuant to this Agreement and
   shall refrain from taking or omitting to take any action that would
   violate Seller's or Parent's representations and warranties
   hereunder in any material respect or render such representations
   and warranties inaccurate in any material respect as of the date of
   this Agreement or the Closing Date or that in any way would prevent
   or impede the consummation of the transactions contemplated hereby.
   
             (ii) *CONFIDENTIAL 6*
   
        SECTION 7.10.  Negotiations
   
             From the date hereof to the termination of this Agreement
   in accordance with Article X, neither Sellers, the Company, or any
   Affiliate of such Persons shall take any action or authorize or
   permit any of their officers, directors or employees or any
   investment banker, attorney, accountant or other representative
   retained by them to take any action (i) to solicit or encourage,
   directly or indirectly (including by way of furnishing any
   information), any inquiries or the making of any proposal which
   could reasonably be expected to lead to any acquisition proposal
   relating to the Company or any Acquired Subsidiary, (ii) to engage
   in any negotiations with respect to an acquisition proposal, (iii)
   to provide any non-public information concerning the Company or any
   Acquired Subsidiary to any Person in connection with any
   acquisition proposal or (iv) to reach any agreement or
   understanding for any acquisition proposal.  Sellers will promptly
   advise Purchaser orally and in writing of any such inquiries or
   proposals of which the Alexander Hamilton Parties become aware.  As
   used in this Agreement, "acquisition proposal" shall mean any
   proposal for a merger, acquisition of all of the stock or assets
   of, or other business combination involving the Company or any
   Acquired Subsidiary or the acquisition of a substantial equity
   interest in any of them, or a substantial portion of the assets of
   any of them other than the transactions contemplated hereunder.
   
        SECTION 7.11.  Tax Basis
   
             At or prior to the Closing, the Alexander Hamilton
   Parties shall deliver to Purchaser a list setting forth as of the
   last date on which such information is available (but not prior to
   December 31, 1994) the adjusted basis of the depreciable or
   amortizable assets of the Company and the Acquired Subsidiaries for
   all Tax Returns for which such information is available and showing
   the original tax cost of the assets and the tax depreciation or
   amortization thereon.
   
        SECTION 7.12.  Computer Services and Software
   
             (a)  On or before the Closing Date, Parent, for itself
   and on behalf of its Affiliates, shall enter into a computer
   services agreement with the Company (the "Computer Services
   Agreement") and shall cause the Information Technology Services
   Agreement between the Company and an Affiliate of Parent to be
   terminated without any cost or expense to the Acquired Companies. 
   The Computer Services Agreement shall obligate Parent and its
   Affiliates to provide certain processing, software, network and
   other computer services (as identified in the Computer Services
   Agreement) to the Acquired Companies.  In addition, the Computer
   Services Agreement shall require the employees of Parent and any
   Affiliate to provide reasonable assistance to the Purchaser to
   ultimately integrate the Relicensed Software Rights and Owned
   Software into Purchaser's operations in support of the Acquired
   Companies as specified in the Computer Services Agreement.  The
   obligations of the Parties described in the foregoing sentence
   shall have a term of 12 months from the Closing Date (subject to
   earlier termination at the sole option of Purchaser upon 90 days
   prior written notice, with the termination date of the Computer
   Services Agreement being deemed the "Conversion Date"), and the
   Computer Services Agreement will provide, as compensation
   thereunder, that Parent will be entitled to receive from Purchaser
   reimbursement for costs reasonably related to providing such
   services.
   
             (b)  On or before the Closing Date, Parent shall obtain
   all necessary consents or licenses required for Parent to perform
   under the Computer Services Agreement and utilize the Business
   Software Rights for the benefit of the Acquired Companies.  All
   fees and expenses for obtaining any licenses or consents required
   for the use of the Business Software Rights for the benefit of the
   Acquired Companies to the Conversion Date shall be paid by
   *CONFIDENTIAL 7*.  Parent is required to maintain such licenses for
   the benefit of the Acquired Companies only as long as the Computer
   Services Agreement is in effect.
   
             (c)  Prior to the Conversion Date, Parent and Purchaser
   shall cooperate to obtain any license required for the Acquired
   Companies to use the Relicensed Software Rights and Owned Software
   after the Conversion Date.  All one time license fees required to
   be paid for the licenses as set forth herein shall be paid by
   *CONFIDENTIAL 7*.  The Company shall be responsible for all ongoing
   annual fees after the Conversion Date.
   
        SECTION 7.13.  Business Transfer
   
             Subject to receipt of appropriate regulatory approvals,
   immediately prior to the Closing Date, Parent shall cause to be
   effected (i) the transfer of the Affiliated Business Assets and the
   reinsurance of the Affiliated Business Liabilities by the Retained
   Subsidiaries on the terms described on Annex A, (ii) the transfer
   of the COLI Business Assets and the reinsurance of the COLI
   Business Liabilities by the Retained Subsidiaries on the terms
   described in Annex B and (iii) the transfer of the PPA Business
   Assets and the reinsurance of the PPA Business Liabilities by the
   PPA Companies on the terms described in Annex C.
   
        SECTION 7.14.  Non-Solicitation
   
             For a period of *CONFIDENTIAL 8* years following the
   Closing Date, Sellers agree that, without the prior written consent
   of Purchaser, neither of Sellers nor any of their Affiliates will
   hire, or solicit to hire, any Producers, officers, directors or
   other employees of the Company and the Acquired Subsidiaries;
   provided that Sellers shall not be prohibited from hiring or
   soliciting to hire (i) individuals who have provided their
   resignations to Purchaser pursuant to Section 3.2(f),
   (ii) individuals who were employed in the Affiliated Business, the
   COLI Business or the PPA Business as of the Closing Date and were
   not expressly retained by an Acquired Company after the Closing
   Date, (iii) individuals whose employment is terminated by the
   Company after the Closing Date and (iv) any clerical or other
   individuals not comprising senior management who respond to any
   general solicitation.
   
        SECTION 7.15.  *CONFIDENTIAL 9*
   
        SECTION 7.16.  Cross-Defaults
   
             *CONFIDENTIAL 10* 
   
        SECTION 7.17.  Payments on the Note; Other Dividends
   
             (a)  *CONFIDENTIAL 11* 
   
             (b)  *CONFIDENTIAL 11*  
   
        SECTION 7.18.  Name Change
   
             Following the Closing Date, and in no event later than
   one year following the Closing Date, Seller shall change the
   corporate names of Alexander Hamilton Life Insurance Company of
   Arizona, Alexander Hamilton Insurance Agency, Inc., Hamilton
   National Life Insurance Company and Alexander Hamilton Insurance
   Company of America, to one that does not include the words
   "Alexander Hamilton" or "Hamilton" or any other words confusingly
   similar thereto and will make all necessary filings to record such
   name change.
   
        SECTION 7.19.  Delivery of Additional Financial Statements
   
             At Purchaser's request, the Company will cooperate on a
   timely
   basis with Purchaser in the preparation of all financial statements
   required to meet Purchaser's SEC reporting requirements and will be
   reimbursed for any incremental direct costs, except those
   associated with the statements contemplated in Section 5.9.
   
        SECTION 7.20.  Administrative Services
   
             Purchaser and Sellers agree that on or prior to the
   Closing Date they will enter into an agreement (the "Administrative
   Services Agreement") on mutually acceptable terms for Purchaser to
   provide administrative services for the PPA Business, the COLI
   Business and the Affiliated Businesses, pursuant to which Purchaser
   will be entitled to receive reimbursement for costs reasonably
   related to providing such service.
   
   
                             ARTICLE VIII.
                        COVENANTS OF PURCHASER
   
             Purchaser covenants and agrees that between the date of
   this Agreement and the Closing Date:
   
        SECTION 8.1.  Performance
   
             Purchaser shall perform all acts to be performed by it
   prior to the Closing pursuant to this Agreement and shall refrain
   from taking or omitting to take any action that would violate
   Purchaser's representations and warranties hereunder in any
   material respect or render such representations and warranties
   inaccurate in any material respect as of the date of this Agreement
   or the Closing Date or that in any way would prevent or impede the
   consummation of the transactions contemplated hereby.
   
        SECTION 8.2.  Further Assurances
   
             Subject to the terms and conditions of this Agreement,
   Purchaser shall use all reasonable efforts to take, or cause to be
   taken, all action, and to do, or cause to be done, all things
   reasonably necessary, proper, or advisable under applicable laws
   and regulations to consummate the transactions contemplated by this
   Agreement and to make effective the sale of the Shares and the Note
   pursuant to this Agreement.
   
        SECTION 8.3.  Consents and Notices
   
             Purchaser shall use its best efforts to obtain all
   consents of, and provide all notices to, other Persons reasonably
   required for Purchaser to consummate the transactions contemplated
   hereby and by the Transaction Documents, if any such consents or
   notices are required.  Without limiting the generality of the
   foregoing, Purchaser shall use its best efforts to satisfy or cause
   to be satisfied all the conditions to the obligations of Seller set
   forth in Sections 9.1 and 9.2.  Purchaser shall use its best
   efforts to make within 45 days following the date hereof all
   initial filings required to be made by it relating to its
   acquisition of control of the Company and the Acquired
   Subsidiaries, including all filings believed by it to be required
   to be made with state insurance regulatory officials.  Purchaser
   shall respond promptly to each request for further information or
   documentation from regulatory officials and shall provide, where
   practicable, Seller with prior notice of, and shall seek to obtain
   for Seller the opportunity to participate in, all material
   telephone conferences and meetings with regulatory officials
   concerning the transactions contemplated hereby.  Purchaser shall
   provide Seller with a copy of, and the opportunity to comment on,
   all filings and material correspondence with regulatory officials
   within one Business Day prior to its filing with and delivery to
   such officials, and shall provide Seller with a copy of all
   correspondence or notices from regulatory officials within one
   Business Day following receipt by Purchaser.
   
        SECTION 8.4.  Employee Benefit Plans
   
             (a)  Effective as of the Closing Date (or such other
   administratively convenient date mutually determined by Parent and
   Purchaser), Purchaser shall amend one or more of its previously
   adopted defined benefit plans or shall adopt (or shall cause the
   Company to adopt) one or more defined benefit plans for the benefit
   of employees and former employees of the Acquired Companies
   (including their surviving spouses and other beneficiaries) who
   immediately prior to the Closing Date were participants in the HI
   RIP, other than employees of the Retained Subsidiaries and the PPA
   Companies.  For purposes of Sections 8.4, 8.5, 8.6 and 8.7 hereof,
   "former employees" of the Acquired Companies shall be determined as
   of the Closing Date and shall not include any employees of the
   Retained Subsidiaries or the PPA Companies.  Such individuals
   covered by such plan or plans maintained by Purchaser (or by the
   Company) hereunder shall be known as the "Covered Employees."  Such
   plan(s) shall be tax-qualified under Section 401(a) of the Code. 
   Effective as of the Closing Date (or such other administratively
   convenient date determined by Parent and Purchaser), each Covered
   Employee shall have an accrued benefit under the plan(s) maintained
   by Purchaser (or by the Company) pursuant to this Section 8.4 that
   is no less than the accrued benefit that he or she had under the HI
   RIP as of the date immediately prior to the Closing Date.  The term
   "accrued benefit" for this purpose shall include any optional forms
   of accrued benefits and other rights within the scope of
   Section 411(d)(6) of the Code.  Effective as of the date
   immediately prior to the Closing Date, benefits on behalf of
   Covered Employees shall cease to accrue under the HI RIP.  The sum
   of the assets properly allocated to the accrued benefits of each
   Covered Employee *CONFIDENTIAL 12* in the HI RIP, shall be
   transferred in conformity with the requirements of Section 414 of
   the Code in cash, or in kind if such assets are satisfactory to
   Purchaser, from the trust under the HI RIP to the separate account,
   trust or other funding vehicle under Purchaser's (or the Company's)
   Benefit Plan(s) on a date that is mutually agreeable to Parent and
   Purchaser, which shall be no later than the last day of the 12th
   month following the Closing Date and at least 30 days after filing
   the appropriate notices with the IRS.  The total amount of assets
   to be transferred shall be a percentage of the total fair market
   value of the assets held under the HI RIP as of the end of the
   month preceding the month in which the transfer occurs, with the
   percentage determined as follows.  Parent shall cause to be made a
   calculation of benefits on an *CONFIDENTIAL 13* basis as of
   January 1, 1995 for the Covered Employees, based on the methodology
   and assumptions used in Parent's actuarial report from Towers
   Perrin dated March 1995.  The total *CONFIDENTIAL 13* for the
   HI RIP as of January 1, 1995 as presented in the Towers Perrin
   report, and the *CONFIDENTIAL 13* for the Covered Employees as of
   January 1, 1995, each shall be rolled forward to the Closing Date
   to reflect the actual benefit payments, current pension cost
   accruals and the *CONFIDENTIAL 13* assumed earnings rate through
   such date.  The percentage of assets transferred shall be the
   percentage that the *CONFIDENTIAL 13* for Covered Employees
   represents of the total *CONFIDENTIAL 13* for the HI RIP.  Upon
   such transfer, but subject to the obligation to reconcile errors,
   neither Parent nor any Affiliate shall have any liability to the
   Covered Employees for benefits accrued under the HI RIP prior to
   the Closing Date and no further funding obligation in respect of
   such benefits.  Prior to the date of such transfer, Purchaser shall
   furnish Parent the following, to the extent applicable:  (i) at
   Parent's request, copies of Purchaser's (or the Company's) benefit
   plan(s) contemplated herein and the funding agreements thereunder,
   together with any amendments thereof, (ii) copies of the most
   recent determination letter(s) issued by the IRS with respect to
   the qualification under Section 401(a) of the Code of Purchaser's
   (or the Company's) plan(s) contemplated herein, (iii) copies of any
   applications for determination with respect to such plan(s) and as
   to which determination letters have not yet been received, (iv) if
   no determination letter(s) have yet been received with respect to
   the initial qualification of Purchaser's (or the Company's) plan(s)
   contemplated herein, or if such plan(s) have been amended since the
   date of the last determination letter(s), a letter from counsel to
   Purchaser, satisfactory to Parent, that provides that the plan(s)
   (or plan(s), as amended) are intended to satisfy the qualification
   requirements of Section 401(a) of the Code and that Purchaser will
   timely make (or cause the Company to make) such amendments as may
   be required by the Internal Revenue Service to receive the
   determination letter(s) and (v) evidence satisfactory to Parent
   that Purchaser (or the Company's) plan(s) contain language
   providing for the receipt of the transferred assets as provided
   herein.  The obligation to provide benefits that accrued prior to
   the Closing Date in the case of any Covered Employee whose
   employment was terminated prior to the date of the transfer of
   assets contemplated herein shall remain that of the HI RIP until
   such transfer of assets; provided, however, that any payments made
   in the interim from the HI RIP shall be a credit to the total
   amount of assets to be transferred as provided herein.  The Parties
   shall cooperate in giving any appropriate notices to employees and
   former employees and to governmental agencies.
   
             (b)  Effective as of the Closing Date (or such other
   administratively convenient date mutually determined by Parent and
   Purchaser), Purchaser shall amend one or more of its previously
   adopted profit sharing or stock bonus plans or shall adopt (or
   shall cause the Company to adopt) one or more profit sharing or
   stock bonus plans for the benefit of employees and former employees
   of the Acquired Companies (including their surviving spouses and
   other beneficiaries) who immediately prior to the Closing Date were
   participants in the HI TRIP, other than employees of the Retained
   Subsidiaries and the PPA Companies (and their surviving spouses and
   other beneficiaries).  Such individuals covered by such plan or
   plans maintained by Purchaser (or by the Company) as contemplated
   hereunder shall be known as the "TRIP Eligible Employees."  Such
   plan(s) shall (i) be tax-qualified under Section 401(a) of the
   Code, (ii) contain a qualified cash or deferred arrangement under
   Section 401(k) of the Code and (iii) preserve all optional forms of
   benefits and other rights within the scope of Section 411(d)(6) of
   the Code.  On a date that is mutually agreeable to Parent and
   Purchaser, which shall be no later than the last day of the 12th
   month following the Closing Date, there shall be a transfer from
   the HI TRIP to a trust, separate account or other funding vehicle
   under such plan(s) contemplated herein and maintained by Purchaser
   (or by the Company) (i) the obligation for benefit payments under
   the HI TRIP to all TRIP Eligible Employees and (ii) an amount of
   assets, in cash or in kind (if the assets are mutually agreeable to
   Parent and Purchaser), equal to the aggregate account balances
   under the HI TRIP of all TRIP Eligible Employees, determined as of
   a valuation date not more than three Business Days prior to the
   date of the transfer as determined by Parent.  Prior to the date of
   such transfer, Purchaser shall furnish Parent the following, to the
   extent applicable, (i) at Parent's request, copies of the
   Purchaser's (or the Company's) plan(s) contemplated herein and the
   trust or other funding agreements thereunder, together with any
   amendments thereof, (ii) copies of the most recent determination
   letter(s) issued by the IRS with respect to the qualification under
   Section 401(a) of the Code of Purchaser's (or the Company's)
   plan(s) contemplated herein, (iii) copies of any applications for
   determination with respect to such plan(s) and as to which
   determination letters have not yet been received, (iv) if no
   determination letter(s) have yet been received with respect to the
   initial qualification of Purchaser's (or the Company's) plan(s)
   contemplated herein, or if such plan(s) have been amended since the
   date of the last determination letter(s), a letter from counsel to
   Purchaser, satisfactory to Parent, that provides that the plan(s)
   (or plan(s), as amended) are intended to satisfy the qualification
   requirements of Section 401(a) of the Code and that Purchaser will
   timely make (or cause the Company to make) such amendments as may
   be required by the Internal Revenue Service to receive the
   determination letter(s) and (v) evidence satisfactory to Parent
   that Purchaser's (or the Company's) plan(s) contain language
   providing for the receipt of the transferred assets as provided
   herein.  Prior to the transfers described herein, Parent shall
   continue to administer the account balances of the TRIP Eligible
   Employees in such manner as Parent, in its sole discretion, shall
   determine, and *CONFIDENTIAL 14*.  At Parent's request, Purchaser
   (or the Company) shall make payroll withholding arrangements to
   ensure that TRIP Eligible Employees' loans from HI TRIP are timely
   repaid.
   
             (c)  *CONFIDENTIAL 15* 
   
             (d)  Except as otherwise provided in this Article VIII,
   Purchaser makes no representations, warranties or covenants with
   respect to any compensation or benefits to be offered or provided
   to employees or former employees of any Acquired Company after the
   Closing Date.
   
        SECTION 8.5.  Excess Benefit Plan
   
             (a)  Parent shall provide Purchaser with a list of each
   employee or former employee of any Acquired Company other than
   employees of the Retained Subsidiaries and the PPA Companies who is
   covered under the Household International Supplemental Retirement
   Income Plan and the benefit accrued under such plan through the
   Closing Date by each such person.  Purchaser shall amend its
   previously adopted excess defined benefit plan or shall adopt (or
   cause the Company to adopt) an excess defined benefit plan to cover
   such employees and former employees, and each such person's accrued
   benefit under Purchaser's (or the Company's) plan shall not be less
   than such person's benefit accrued through the Closing Date as
   shown on such list.  As soon as practicable following the Closing
   Date, and based on the assumptions used in Parent's actuarial
   report from Towers Perrin dated March 1995, Parent shall transfer
   cash or assets acceptable to Purchaser equal to the present value
   of such accrued benefits plus interest (at the rate of 7.75% per
   annum), less any benefit payments made in the interim to the date
   of transfer.  The obligation to provide such benefits prior to the
   Closing Date in the case of any employee whose employment is
   terminated prior to the date of the transfer of assets contemplated
   herein shall remain that of Parent until such transfer of assets.
   
             (b)  Parent shall provide Purchaser with a list of each
   employee or former employee of any Acquired Company other than
   employees of the Retained Subsidiaries and the PPA Companies who is
   covered under the Household International Supplemental Tax
   Reduction Investment Plan and the account balances under such plan
   through the Closing Date for each such person.  Purchaser shall
   amend its previously adopted excess defined contribution plan or
   shall adopt (or cause the Company to adopt) an excess defined
   contribution plan to cover such employees and former employees, and
   each such person's opening account balance under Purchaser's (or
   the Company's) plan shall not be less than such person's account
   balance through the Closing Date as shown on such list.  As soon as
   practicable following the Closing Date, Parent shall transfer cash
   or assets acceptable to Purchaser equal to the account balance of
   each such person at the Closing Date plus reasonable interest to
   the date of transfer.  The obligation to provide benefits in the
   case of any employee whose employment is terminated prior to the
   date of the transfer of assets contemplated herein shall remain
   that of Parent until such transfer of assets.
   
        SECTION 8.6.  Employee Welfare Benefit Plans
   
             (a)  Definitions.  In addition to terms defined elsewhere
   in this Agreement, the following terms shall have the following
   meanings for purposes of this Section 8.6:
   
                  (i)  "COBRA" shall mean the Consolidated Omnibus
             Budget Reconciliation Act of 1985, as amended.
   
                  (ii) "Former Employees" shall mean the individuals
             who have terminated (or terminate) employment with the
             Acquired Companies other than employees of the Retained
             Subsidiaries and the PPA Companies prior to and including
             the Closing Date, and who have made a prior election, are
             eligible to elect, or will be eligible to elect
             continuation coverage under COBRA in the future.
   
                  (iii) "Present Employees" shall mean the
             individuals who are employed by the Acquired Companies
             other than employees of the Retained Subsidiaries and the
             PPA Companies as of the Closing Date.
   
                  (iv) "Retirees" shall mean all individuals who have
             retired in the past or who elect retirement prior to or
             as of the Closing Date from the employ of the Acquired
             Companies (including any individuals who retired from any
             predecessors to the Acquired Companies) and are eligible
             for and/or enrolled for post-retirement benefits under
             one or more of  Parent's welfare plans listed in
             Exhibit 5.17.
   
                  (v)  "Welfare Plan" shall mean an employee welfare
             benefit plan as described in Section 3(1) of ERISA.
   
             (b)  Cessation of Participation in Parent's Welfare Plans
   
                  (i)  Effective on the Closing Date, Company shall
             cease participation in any Welfare Plan sponsored by
             Parent, including, but not limited to, all fully insured
             Welfare Plans (including Health Maintenance Organization
             and Dental Maintenance Organization contracts), all self-
             insured coverages and the Parent's Internal Revenue Code
             Section 125 Plan and any Health or Dependent Care
             Spending Accounts thereunder.  Purchaser (or the Company)
             shall give written notice to all of  the Company's
             Welfare Plan participants, including Former Employees,
             Present Employees and Retirees that the Company has
             assumed full responsibility for all Welfare Plan benefits
             in accordance with clause (ii) below.
   
                  (ii) Effective on the Closing Date, Purchaser (or
             the Company) shall assume full responsibility for all
             Welfare Plan coverages as follows.  All Present
             Employees, Retirees  and Former Employees shall be
             eligible for immediate coverage under Purchaser's (or the
             Company's) Welfare Plans, with waiver of any pre-existing
             conditions and including coverage required under COBRA,
             and neither Parent, nor any member of Parent's controlled
             group shall thereupon be responsible, or liable, for
             coverage (including any past, present or future coverage
             required under COBRA) of such individuals.
   
                  (iii)     With respect to Retiree Welfare Plan
             coverages currently provided under Parent's Welfare
             Plans, the Company shall establish Retiree Health Plans
             covering all Retirees as defined under this Section 8.6,
             and shall assume all liability for the Retiree Welfare
             Plan coverages as of such date.  The Parties acknowledge
             that nothing in this clause (iii) is intended to limit
             Purchaser's or the Company's ability to amend such
             Retiree Health Plans on or after the Closing Date.
   
             (c)  Transitional Matters
   
                  (i)  Liabilities under the Welfare Plans for claims
             incurred prior to the Closing Date shall remain with
             Parent under its Welfare Plans.
   
                  (ii) Parent and Purchaser shall mutually agree upon
             the method of handling the transitional issues related to
             cafeteria plans including the transfer of any Health or
             Dependent Care Spending Account credits.
   
        SECTION 8.7.  Benefits Transition
   
        On and after the Closing Date, neither Parent nor Seller shall
   have any liability with respect to any plans or benefits listed in
   Exhibit 5.17 as they apply to employees or former employees of the
   Acquired Companies, and the Company assumes all liability therefor;
   provided, however that (a) the Company shall not assume any
   liability for accruals to the Closing Date for the HI RIP, the HI
   TRIP and the excess plans until such time, if any, that the
   respective plan assets (and amounts described in Section 8.5(a) and
   (b)) are transferred, (b) liabilities under welfare benefit plans
   for claims and other events that occur prior to the Closing Date
   shall remain with Parent under its plans and (c) for stock options
   and other plans or programs over which the Acquired Companies do
   not have control, Parent shall remain obligated and no liability
   therefor will be assumed by any Acquired Company.
   
   
                              ARTICLE IX.
                         CONDITIONS TO CLOSING
   
        SECTION 9.1.  Conditions to Each Party's Obligations
   
             The respective obligations of each Party to effect the
   transactions contemplated hereby shall be subject to the following
   conditions:
   
             (a)  Absence of Restraints.  At the Closing Date, there
   shall be no litigation, claim, action, governmental or other
   proceeding, investigation, inquiry, or review, pending or
   threatened, to restrain, prohibit, invalidate, or set aside in
   whole or in part the consummation of this Agreement or the
   transactions contemplated hereby or to obtain substantial damages
   in connection therewith.  There shall be in effect no judgment,
   injunction, order, writ, decree, or ruling of any court, government
   or governmental authority of competent jurisdiction restraining or
   prohibiting in whole or in part the transactions contemplated
   hereby.
   
             (b)  Consents.  All consents, approvals, waivers, and
   actions of governmental authorities and others necessary to permit
   the Parties to consummate the transactions contemplated hereunder
   shall have been obtained or waived.
   
             (c)  Ancillary Agreements.  The Parties shall have
   entered into such other agreements as contemplated by this
   Agreement, including but not limited to the Transaction Documents.
   
        SECTION 9.2.  Conditions to Sellers' Obligations  
   
             The obligations of Sellers to consummate the transactions
   contemplated by this Agreement are subject to the satisfaction, at
   or prior to the Closing Date, of each of the following conditions
   (any or all of which may be waived by Sellers):
   
             (a)  Compliance with Covenants.  Purchaser shall have
   performed and complied in all material respects with the terms,
   covenants and conditions required by this Agreement to be performed
   or complied with by it on or before the Closing Date.
   
             (b)  Representations and Warranties True and Correct. 
   The representations and warranties of Purchaser contained in this
   Agreement shall be true and correct in all material respects as of
   the Closing Date with the same force and effect as though such
   representations and warranties had been made as of the Closing
   Date, and Sellers shall have received as of the Closing Date a
   certificate of an authorized officer of Purchaser, dated as of the
   Closing Date, to such effect.
   
             (c)  Opinion of Counsel.  Seller shall have received from
   John D. Hopkins, General Counsel of Purchaser, an opinion dated the
   Closing Date, in a form satisfactory to Seller, to the effect that:
   
                  (i)  Purchaser is a corporation duly organized,
             validly existing and in good standing under the laws of
             North Carolina, and Purchaser has the corporate power and
             authority to own its properties and conduct its business
             as currently conducted.
   
                  (ii) All corporate proceedings required on the part
             of Purchaser to authorize the execution, delivery and
             performance of the Agreement, the purchase of the Shares
             and the Note hereunder by Purchaser and other obligations
             contemplated hereunder have been duly completed.
   
                 (iii) This Agreement has been and the other
             agreements to be executed by Purchaser on the Closing
             Date as contemplated by this Agreement will be, duly
             executed and delivered by Purchaser and are valid and
             binding upon, and enforceable against, Purchaser in
             accordance with their terms, subject, as to the
             enforceability of remedies, to applicable bankruptcy,
             insolvency, reorganization, moratorium and similar laws
             of general applicability relating to or affecting
             creditors' rights and to general principles of equity.
   
                  (iv) All consents and approvals from any
             governmental or regulatory authority that are required
             for Purchaser to consummate the transactions contemplated
             by this Agreement have been received and obtained.
   
             (d)  No Litigation.  There shall not be pending or, to
   the knowledge of any executive officer of Purchaser, threatened,
   any claim, suit, action or other proceeding by any governmental
   agency before any court or governmental agency, seeking to prohibit
   or restrain the transactions contemplated by the Agreement or
   seeking material damages in connection therewith.  The waiting
   period required by the HSR Act shall have expired or the Parties
   shall have been granted early termination.  All approvals appearing
   on Exhibit 6.4 shall have been obtained.
   
             (e)  Corporate Actions.  All corporate and other acts
   necessary to authorize Purchaser's execution, delivery, and
   performance of this Agreement and the Transaction Documents and the
   consummation of the transactions contemplated hereunder and
   thereunder shall have been taken by Purchaser.
   
             (f)  Corporate Documents.  At the Closing, Purchaser
   shall have delivered to Sellers:
   
                  (i)  a certificate of its jurisdiction of
             incorporation dated not earlier than the 10th day
             preceding the Closing Date, to the effect that Purchaser
             is a corporation validly existing and in good standing
             (if applicable) under the laws of such place of
             jurisdiction as of such date;
   
                  (ii) certificates of the Secretary or Assistant
             Secretary of Purchaser attaching (A) duly enacted
             resolutions of Purchaser's board of directors with
             respect to the approval of this Agreement and the
             Transaction Documents and any other agreements executed
             and delivered among the Parties hereby and thereby and
             the performance and consummation hereby and thereby and
             the authorization of the officers of Purchaser to sign
             this Agreement, which resolutions shall continue to be in
             force as of the Closing Date, and (B) specimen signatures
             of the officers of Purchaser authorized to sign this
             Agreement and the Transaction Documents;
   
                 (iii) a copy, certified as true by the Secretary
             or Assistant Secretary of Purchaser, of the
             organizational documents of Purchaser; and
   
                  (iv) all other documents, instruments, and writings
             required to be delivered by Purchaser pursuant to this
             Agreement.
   
        SECTION 9.3.  Conditions to Purchaser's Obligations  
   
             The obligations of Purchaser to consummate the
   transactions contemplated by this Agreement are subject to the
   satisfaction on or prior to the Closing Date of each of the
   following conditions (any or all of which may be waived by
   Purchaser):
   
             (a)  Compliance with Covenants.  Parent, Seller and the
   Company shall have performed and complied in all material respects
   with the terms, covenants and conditions required by this Agreement
   to be performed or complied with by them on or before the Closing
   Date.
   
             (b)  Representations and Warranties True and Correct. 
   The representations and warranties of Parent and Seller contained
   in this Agreement shall be true and correct in all material
   respects as of the Closing Date with the same force and effect as
   though such representations and warranties had been made as of the
   Closing Date, and Purchaser shall have received a certificate,
   dated as of the Closing Date, executed by an authorized officer of
   each such Party, to such effect.
   
             (c)  Opinion of Counsel.  Purchaser shall have received
   from John W. Blenke, counsel to Parent and Seller, an opinion dated
   the Closing Date in a form satisfactory to Purchaser to the effect
   that:
   
                  (i)  Each of Seller and Parent is a corporation
                       duly organized, validly existing and in good
                       standing under the law of the State of
                       Delaware, and all corporate proceedings
                       required on the part of Seller and Parent to
                       authorize the execution, delivery and
                       performance of the Agreement and the
                       Transaction Documents and the sale of Shares
                       and the Note hereunder have been duly
                       completed.
             
                  (ii) The Company is a corporation duly
                       incorporated, validly existing and in good
                       standing under the laws of the State of
                       Michigan, with full corporate power and
                       authority to own, operate and lease its
                       properties and to carry on its business as
                       presently being conducted.  The Company is
                       duly qualified to do business as a foreign
                       corporation and is in good standing, if
                       applicable, in each jurisdiction where the
                       failure to be so qualified, if qualification
                       is required, would have a Material Adverse
                       Effect.  Each of the Company and First
                       Alexander Hamilton Life Insurance Company is
                       duly qualified to do business as a stock life
                       insurance company and is in good standing, if
                       applicable, as an insurance corporation in the
                       jurisdictions listed in Exhibit 5.1(b).  All
                       corporate proceedings required on the part of
                       the Company to authorize the execution,
                       delivery and performance of the Agreement have
                       been duly completed.
        
                 (iii) The Agreement and the Transaction
                       Documents have been duly executed and
                       delivered by Parent and Seller and are
                       valid and binding upon, and enforceable
                       against, each of them in accordance with
                       their terms, subject, as to the
                       enforceability of remedies, to applicable
                       bankruptcy, insolvency, reorganization,
                       moratorium and similar laws of general
                       applicability relating to or affecting
                       creditors' rights and to general
                       principles of equity.
   
                  (iv) The authorized capital stock of the Company
                       consists solely of 500,000 shares of common
                       stock, par value $10.00 per share, of which
                       375,000 shares issued and outstanding.  The
                       Company has no other shares of capital stock
                       of any class or other equity securities
                       authorized, issued or outstanding, and there
                       are no outstanding or authorized options,
                       warrants, calls, subscriptions, rights,
                       agreements or commitments of any character
                       obligating the Company to issue any shares of
                       its capital stock or securities convertible
                       into or exchangeable for or evidencing the
                       right to purchase or subscribe for any shares
                       of capital stock of the Company.  The Shares
                       have been validly issued, fully paid and are
                       nonassessable and free of preemptive rights.
   
                  (v)  Seller is the beneficial and legal registered
                       owner of the Shares and Parent is the legal
                       registered owner of the Note.  Upon
                       consummation of the transactions contemplated
                       by the Agreement and the Transaction
                       Documents, Purchaser will acquire good and
                       valid title to the Shares and Note, in each
                       case free and clear of all Encumbrances.
   
                  (vi) The Company is the registered owner of all
                       outstanding shares of the capital stock of
                       each of the Acquired Subsidiaries, and each of
                       the Acquired Subsidiaries is a corporation
                       (A) duly incorporated, validly existing and in
                       good standing, if applicable, under the laws
                       of the jurisdiction of its incorporation, with
                       full corporate power and authority to own,
                       operate and lease its properties and carry on
                       its business as presently being conducted and
                       (B) duly qualified to do business as a foreign
                       or domestic corporation and in good standing,
                       if applicable, in all jurisdictions in which
                       failure to be so qualified, if qualification
                       is required, would have a Material Adverse
                       Effect.
   
             (d)  Corporate Actions.  All corporate and other acts
   necessary to authorize the execution, delivery, and performance of
   this Agreement and the Transaction Documents and the consummation
   of the transactions contemplated hereunder and thereunder shall
   have been taken by the Alexander Hamilton Parties.
   
             (e)  Shares and Note.  Seller and Parent shall have
   delivered to Purchaser certificates representing the Shares and the
   original Note, respectively, endorsed for transfer to Purchaser or
   accompanied by an assignment duly executed.
   
             (f)  Corporate Documents.  At the Closing, Sellers shall
   have delivered to Purchaser:
   
                  (i)  a certificate of its jurisdiction of
             incorporation dated not earlier than the date of the 10th
             day preceding the Closing Date for each of Sellers and
             the Acquired Subsidiaries, to the effect that such
             corporation is a corporation validly existing and in good
             standing (if applicable) under the laws of such place of
             jurisdiction as of such date;
   
                  (ii) certificates of the secretary or assistant
             secretary of each of the Alexander Hamilton Parties
             attaching (A) duly enacted resolutions of its board of
             directors with respect to the approval of this Agreement
             and the Transaction Documents and any other agreements
             executed and delivered among the Parties hereby and
             thereby and the performance and consummation hereby and
             thereby and the authorization of the officers of such
             Person to sign this Agreement, which resolutions shall
             continue to be in force as of the Closing Date and
             (B) specimen signatures of the officers of such Person
             authorized to sign this Agreement and the Transaction
             Documents;
   
                  (iii) a copy, certified as true by the secretary
             or assistant secretary of each of Sellers and the
             Acquired Companies, of the articles of incorporation and
             the by-laws of such Person; and
   
                  (iv) all other agreements (including the Transaction
             Documents), documents, instruments and writings required
             to be delivered by Sellers or the Company pursuant to
             this Agreement.
   
   
                              ARTICLE X.
                              TERMINATION
   
        SECTION 10.1.  Termination
   
             This Agreement (except for the provisions of
   Section 5.23, 6.8, 13.3, and 13.5 which will continue in effect)
   may be terminated and the transactions contemplated hereunder
   abandoned:
   
             (a)  At any time prior to the Closing Date by the mutual
   written agreement of Sellers and Purchaser;
   
             (b)  By Sellers:
   
                  (i)  if the Closing is not consummated on or before
             December 31, 1995, unless the failure of such occurrence
             shall be due to the intentional failure of any of the
             Alexander Hamilton Parties to perform or observe the
             covenants, agreements and conditions hereof to be
             performed or observed by such entity at or before the
             Closing Date;
   
                  (ii) if events occur which render impossible
             compliance with one or more of the conditions set forth
             in Sections 9.1 and 9.2 hereof and such conditions are
             not waived by Parent; provided that such events did not
             result from any action or omission by any Alexander
             Hamilton Parties which was within the control of such
             entity and which such entity was not expressly permitted
             to take or omit by the terms of this Agreement; or
   
                 (iii) if any Alexander Hamilton Party is
             enjoined by any administrative agency, commission or
             court and such injunction prevents the performance by the
             Alexander Hamilton Parties of their obligations hereunder
             and such injunction shall not have been withdrawn by the
             earlier to occur of the date which is 60 days after the
             date on which such injunction was first issued or
             December 31, 1995.
   
             (c)  By Purchaser:
   
                  (i)  if the Closing is not consummated on or before
             December 31, 1995, unless the failure of such occurrence
             shall be due to the intentional failure of Purchaser to
             perform or observe the covenants, agreements and
             conditions hereof to be performed or observed by it at or
             before the Closing Date;
   
                  (ii) if events occur which render impossible
             compliance with one or more of the conditions set forth
             in Sections 9.1 and 9.3 hereof and such conditions are
             not waived by Purchaser; provided that such events did
             not result from any action or omission by Purchaser which
             was within its control and which Purchaser was not
             expressly permitted to take or omit by the terms of this
             Agreement; or
   
                 (iii) if Purchaser is enjoined by any
             administrative agency, commission or court and such
             injunction prevents the performance by Purchaser of its
             obligations hereunder and such injunction shall not have
             been withdrawn by the earlier to occur of the date 60
             days after the date on which such injunction was first
             issued or December 31, 1995.
   
   
                              ARTICLE XI.
                     SURVIVAL AND INDEMNIFICATION
   
        SECTION 11.1.  Survival
   
             The representations and warranties made herein or in any
   Transaction Document or other documentation delivered hereby or
   thereby shall survive the Closing Date for *CONFIDENTIAL 16*;
   provided, however that (i) the representations and warranties of
   Sellers in Sections 5.3, 5.5, 5.6 and 5.7, (ii) the representations
   and warranties of Sellers in Section 5.31 (but only to the extent
   that the representations and warranties in Section 5.31 relate to
   Investments or property interests that were not owned, leased or
   operated by any of the Acquired Companies at any time after the
   Closing); and (iii) all covenants, agreements and indemnification
   matters, other than as otherwise provided in Section 11.2(a)(i),
   (iii) or (iv), shall survive *CONFIDENTIAL 16*; provided, further,
   that the representations, warranties, agreements, covenants and
   indemnification matters of Article XII shall survive *CONFIDENTIAL
   16*. 
   
        SECTION 11.2.  Sellers' Indemnification
   
             (a)  Except with respect to Taxes (which are provided for
   in Article XII exclusively), Sellers jointly and severally shall
   indemnify and hold harmless Purchaser, its Affiliates, officers,
   directors, employees, agents, successors, and assigns and related
   entities from and reimburse them for any loss, cost, expense,
   damage (including damages to Persons, property or the environment),
   liability, fines, penalties or claim (including all Legal Fees,
   engineering and other consultant fees and expenses and collectively
   the "Indemnified Costs") relating to, arising out of, based upon,
   or resulting from:
   
                  (i)  (A)  Any inaccuracy in any representation or
             warranty made by Parent or Seller in this Agreement or
             the Transaction Documents for which indemnification is
             claimed hereunder within the applicable survival period;
             and
                  
                       (B)  The Company's or any of its subsidiaries,
             violation of, or liabilities under, any Environmental
             Laws, irrespective of whether known as of the Closing
             Date; provided that, if a claim for indemnification under
             this subclause (B) relates to an Investment or other
             property interest that was owned, leased or operated by
             any of the Acquired Companies at any time after the
             Closing, such claim for indemnification shall be valid
             only if made within *CONFIDENTIAL 16* following the
             Closing Date;
   
             provided, that Sellers shall not have any liability for
             such indemnification pursuant to *CONFIDENTIAL 17*, in
             which case Sellers' liability shall be only for such
             excess and, provided, further, that such limitation shall
             not apply to the breach of any representation or warranty
             contained in Sections 5.3, 5.5, 5.6 or 5.7 or
             Article XII;
   
                  (ii) Seller's, Parent's or the Company's breach of
             or failure to perform any of its covenants or agreements
             contained in or made pursuant to this Agreement or the
             Transaction Documents;
   
                 (iii) *CONFIDENTIAL 17*; 
   
                  (iv) *CONFIDENTIAL 17*; 
   
                  (v)  *CONFIDENTIAL 17*; 
   
                  (vi) *CONFIDENTIAL 17*; and 
   
                 (vii)  Any Indemnified Liability.
   
             (b)  *CONFIDENTIAL 17*: 
   
                  (i)  to the extent and in the amount of any
             nonutilized provision or reserve in respect of the
             matter, action, or proceeding giving rise to any such
             liability specifically made by the Company or the
             Acquired Subsidiaries and such reserve is reflected on
             the Closing Date Statutory Statements as agreed by the
             Parties in accordance with Section 2.3;
   
                  (ii) to the extent such liability arises from some
             act or omission of Purchaser at any time or of the
             Company after the Closing Date; and
   
                 (iii) to the extent that Purchaser, the Company,
             or any Affiliate thereof obtains a Tax Benefit.
   
             (c)  (i)  *CONFIDENTIAL 17* 
   
                  (ii) *CONFIDENTIAL 17* 
   
             (d)  Notwithstanding anything else contained in this
   Section 11.2, with respect to any breach of a representation or
   warranty in Article V hereof, no claims for *CONFIDENTIAL 17*  
   shall be permitted unless a trier of fact or arbitrator determines
   that an executive officer of the Alexander Hamilton Parties knew
   that the information on which such a claim is based was inaccurate
   or unless the issue is one of ownership of any of the Acquired
   Companies.  Under no circumstances shall an award include punitive
   or exemplary damages. 
   
        SECTION 11.3.  Purchaser's Indemnification
   
             (a)  Except for Taxes (which are provided for in
   Article XII exclusively), Purchaser shall indemnify and hold
   Seller, Parent, its Affiliates, officers, directors, employees,
   agents, successors, and assigns, and related entities from, and
   reimburse them for, Indemnified Costs relating to, arising out of,
   based upon, or resulting from
   
                  (i)  Any inaccuracy in any representation or
             warranty made by Purchaser in this Agreement; provided
             that Purchaser shall not have any liability for such
             indemnification pursuant to this clause (i) unless the
             aggregate of all Indemnified Costs under this clause (i)
             for which Purchaser would, but for this proviso, be
             liable exceeds on a cumulative basis *CONFIDENTIAL 17*,
             in which case Purchaser's liability shall be only for
             such excess and, provided, further, that such limitation
             shall not apply to the breach of any representation or
             warranty contained in Section 6.2;
   
                  (ii) Purchaser's breach of or failure to perform any
             of its covenants or agreements contained in or made
             pursuant to this Agreement or the Transaction Documents
             after the Closing Date; and
   
                 (iii) The operation of the Individual Business
             after the Closing Date.
   
             (b)  Notwithstanding the foregoing, Purchaser shall not
   have any liability to the extent that Parent, Seller or any
   Affiliate thereof obtains a Tax Benefit.
   
        SECTION 11.4.  Indemnification Procedure
   
             (a)  Except for Taxes (which are provided for in
   Article XII exclusively), any Person claiming indemnification
   pursuant to this Agreement shall promptly notify the indemnifying
   Party in writing of the occurrence of any event that such Person
   asserts is or may be an indemnifiable event pursuant to this
   Agreement.  If such event involves the claim of any third party and
   the indemnifying Party confirms in writing its responsibility for
   such liability, if established, the indemnifying Party shall be
   entitled to participate in and, to the extent it shall wish, assume
   control over (in which case the indemnifying Party shall assume all
   expense with respect to) the defense, settlement, adjustment or
   compromise of such claim.
   
             (b)  The indemnified Person shall have the right to
   employ separate counsel in any action or claim and to participate
   in the defense thereof at the expense of the indemnifying Party
   (i) if the retention of such counsel has been specifically
   authorized by the indemnifying Party, or (ii) if the counsel is
   retained because the indemnifying Party does not notify the
   indemnified Person within 20 days after receipt of a claim notice
   that it elects to undertake the defense thereof. The indemnified
   Person shall have the right to employ counsel at the indemnified
   Party's own expense and participate in such action or claim,
   including settlement or trial.
   
             (c)  The indemnifying Party shall obtain the prior
   written approval of the indemnified Person before entering into any
   settlement, adjustment, or compromise of such claim or ceasing to
   defend against such claim that provides for any relief other than
   the payment of monetary damages or which would have a materially
   adverse effect on the indemnified Person or its business or
   operations.
   
             (d)  If the indemnifying Party does not assume control
   over the defense of such claim as provided in Section 11.4(a)
   within 30 days of receipt of notice thereof, the indemnified Person
   shall have the right to defend the claim in such manner as it may
   deem appropriate at the cost and expense of the indemnifying Party
   to settle, adjust, or compromise such claim. 
   
             (e)  The indemnifying Party shall remit payment for the
   amount of a valid and substantiated claim for indemnification
   hereunder promptly upon receipt of a claim notice therefor.  Upon
   the payment in full of any claim hereunder, the indemnifying Party
   shall be subrogated to the rights of the indemnified Person against
   any person with respect to the subject matter of such claim.
   
             (f)  In the event that the indemnifying Party reimburses
   the indemnified Person for any third party claim, the indemnified
   Person shall remit to the indemnifying Party any reimbursement that
   the indemnified Person subsequently receives for such third party
   claim.
   
             (g)  Any matter as to which a claim has been asserted by
   written notice (describing in reasonable details the facts, events
   and circumstances relating to the subject matter of such claim and
   the amount (if reasonably calculable) of the Indemnified Costs in
   connection therewith) to the indemnifying Party that is pending or
   unresolved at the end of any applicable survival period shall
   continue, to the extent permitted by law, to be covered by this
   Article XI notwithstanding any applicable statute of limitations
   (which the Parties hereby waive) or the expiration of such survival
   period until such matter is finally terminated or otherwise
   resolved by the Parties under this Agreement or by a court of
   competent jurisdiction and any amounts payable hereunder are
   finally determined and paid.
   
   
                             ARTICLE XII.
                              TAX MATTERS
   
        SECTION 12.1.  Tax Sharing Agreements
   
             (a)  On the Closing Date, any Tax sharing agreements and
   arrangements between one or more of the Acquired Companies, on the
   one hand, and Seller and any of its Affiliates, on the other hand,
   shall be terminated, and no additional payments shall be made, or
   be due to be made, by any party thereunder, and this Article XII
   shall exclusively control any Tax-related issues between Seller,
   Parent, and Purchaser or involving any of the Acquired Companies.
   
             (b)  Notwithstanding any other provisions of this
   Agreement to the contrary, Seller shall be permitted, at the
   Seller's sole discretion, to make a "deemed dividend election" with
   respect to the Acquired Companies.
   
        SECTION 12.2.  Representations, Warranties, Agreements, and
   Covenants of Seller with Regard to Certain Tax Matters
   
             (a)  With the exception of Canadian income tax returns
   for the years 1991 through 1994, all Tax Returns required to be
   filed by or with respect to the Company and each Acquired
   Subsidiary for taxable periods ending on or prior to the Closing
   Date have been timely filed by them, or will be, and, with respect
   to the Company and the Acquired Subsidiaries, all such Tax Returns
   are or will be true and complete in all material respects. Complete
   and accurate copies of all federal and Canadian Tax Returns filed
   within the past three years have been furnished or made available
   to Purchaser.  Complete and accurate copies of all other Tax
   Returns filed within the past three years have been made available
   to Purchaser.  All Taxes reported on such Tax Returns have been
   paid when due or otherwise payable.  To the extent that any of the
   Taxes are not yet due and payable, the Company and each Acquired
   Subsidiary have accrued or otherwise adequately reserved for such
   Taxes on the Financial Statements in accordance with GAAP and
   Statutory Accounting Principles.
   
             (b)  The Company and each Acquired Subsidiary is a member
   of the affiliated group (as defined in Section 1504 of the Code) of
   which Parent is the common parent.  Parent has included or will
   include the Company and the Acquired Subsidiaries in its
   consolidated federal income Tax Returns for all taxable years that
   begin, on or after January 1, 1992, and end on or before the
   Closing Date, and, to the extent required by law, Parent, Seller or
   the Company has included the Company and the Acquired Subsidiaries
   in their consolidated, combined or unitary Tax Returns relating to
   state income Taxes.  The Seller and Parent shall be solely
   responsible for all Taxes related to the transfers to the PPA
   Companies and the Retained Subsidiaries, and the sale of the
   building pursuant to Section 7.15 hereof.
   
             (c)  Neither the Company nor any Acquired Subsidiary has
   received written notice from any governmental agency in a
   jurisdiction in which such entity does not file a Tax Return
   stating that such entity is subject to taxation by that
   jurisdiction.  Except as set forth on Schedule 12.2(c), neither the
   Company nor any Acquired Subsidiary is required to file any Tax
   Return in any jurisdiction outside the United States.
   
             (d)  Except as set forth in Exhibit 12.2(d), no Tax
   Return of the Company or any Acquired Subsidiary is currently being
   audited by any Taxing authority, and no Potential Tax Liability has
   been threatened by any Taxing authority.  Except as set forth in
   Exhibit 12.2(d), there is no agreement, waiver, or other document
   extending, or having the effect of extending, the period for
   assessment or collection of any Taxes of the Company or any
   Acquired Subsidiary, which extension or waiver is still in effect. 
   Sellers have delivered or made available to Purchaser correct and
   complete copies of all examination reports, statements of
   deficiencies and similar documents prepared by the IRS or any other
   taxing authority that relate to the income, operations or business
   of the Company or any Acquired Subsidiary with respect to any
   period ending on or after December 31, 1985.  All final adjustments
   made by the IRS with respect to any federal Tax Return of the
   Company or any Acquired Subsidiary have been reported to the
   relevant state, local, or foreign taxing authorities to the extent
   required by law.  The Financial Statements of the Company or any
   Acquired Subsidiary have accrued or adequately reserved for all
   Taxes assessed, asserted or claimed to be due (including any Taxes
   for subsequent tax years resulting from the carryover of audit
   adjustments from any prior year's tax returns).
   
             (e)  Except as set forth on Exhibit 12.2(e), no requests
   for ruling or determination letters filed by any of the Alexander
   Hamilton Parties with respect to the income, operations or business
   of the Company or any Acquired Subsidiary are pending with any
   taxing authority.
   
             (f)  Neither the Company nor any Acquired Subsidiary has
   filed a consent pursuant to Section 341(f) of the Code, or agreed
   to have Section 341(f)(2) of the Code apply to any disposition of
   a subsection (f) asset (as such term is defined in
   Section 341(f)(4) of the Code) owned by it.  No property of the
   Company or any Acquired Subsidiary is property that such a
   corporation is or will be required to treat as being owned by
   another Person pursuant to the provisions of Section 168(f)(8) of
   the Internal Revenue Code of 1954, as amended, and in effect
   immediately prior to the enactment of the Tax Reform Act of 1986,
   or is "tax exempt use property" within the meaning of
   Section 168(h)(1) of the Code.  Except as set forth in
   Exhibit 12.2(f), neither the Company nor any Acquired Subsidiary
   has agreed to or is required to make any adjustment pursuant to
   Section 481(a) of the Code by reason of a change in the accounting
   method initiated by any of the Alexander Hamilton Parties that is
   currently in effect.  Except as set forth in Exhibit 12.2(f),
   neither  Parent, Seller, the Company, nor any Acquired Subsidiary
   (x) has, for periods ending on or after January 1, 1992, been a
   member of an affiliated group filing a consolidated federal income
   tax return, other than the affiliated group the common parent of
   which is Parent, or (y) has any liability for Taxes of any Person
   (other than Parent, Seller, the Company and their Subsidiaries)
   under Treasury Regulation Sec. 1.1502-6 or any similar provision of
   state, local or foreign law, or as a transferee or successor, by
   contract, or otherwise.
   
             (g)  The Company and each Acquired Subsidiary are not in
   violation of any material applicable tax information reporting and
   tax withholding obligations (or with notice or lapse of time, or
   both, would be in violation).  Except as disclosed on Exhibit 12.2
   (g), the Company and the Acquired Subsidiaries have timely withheld
   from, and paid over to the appropriate taxing authorities, and have
   properly reported all employee salaries, wages and other
   compensation.  Each life insurance and annuity product issued, sold
   or administered by, or on behalf of, the Company or any Acquired
   Subsidiary has been, and is, in compliance in all material respects
   with Sections 72 and 264 of the Code.  The representations made in
   this paragraph shall only refer to those obligations arising from
   insurance policies not otherwise subject to an agreed upon
   indemnity between Seller and Company.
   
             (h)  Subject to Purchaser's cooperation as set forth in
   Section 12.4, Parent shall prepare and file in a timely manner the
   federal Tax Returns, and any other Tax Returns for Parent's
   consolidated return group required to be filed by or with respect
   to the Company and each Acquired Subsidiary for taxable periods
   ending on or before the Closing Date.  Parent shall pay all Taxes
   due with respect to such Tax Returns, regardless of when such Taxes
   are determined to be due, except that Purchaser shall reimburse
   Seller to the extent such Taxes are provided for in the Closing
   Date Statutory Statements.  If Seller requests within thirty days
   after Closing, each Acquired Company shall prepare for filing by
   Seller (at Seller's expense) any Tax Returns relating to the
   business or assets of the Acquired Company required to be filed
   after the Closing Date for any period ending on or before the
   Closing Date  The Tax Returns referred to in this Section 12.2(h)
   shall, to the extent permitted by applicable Tax law, be prepared
   on a basis consistent with the last previous such Return filed for,
   or with respect to, the respective Acquired Company. 
   Notwithstanding anything to the contrary in this Agreement,
   Purchaser shall pay any sales Taxes, transfer Taxes, registration
   fees, stamp Taxes and other similar Taxes imposed on the sale and
   purchase of the Shares.
   
             (i)  Seller agrees to provide Purchaser complete copies
   of all Tax Returns filed by Seller after the Closing Date for or
   with respect to each Acquired Company, no later than 30 Business
   Days after such Returns have been timely filed with the applicable
   taxing authorities, taking into account all valid extensions of
   time to file such Returns.
   
             (j)  Purchaser shall prepare and file in a timely manner
   all Tax Returns, other than the Tax Returns provided for in
   paragraph (h) above, that are required to be filed by or with
   respect to the Company and each Acquired Subsidiary for Straddle
   Periods.  Seller shall be obligated for the portion of the Taxes 
   properly allocable to the time period from the start of the
   Straddle Period through the Closing Date, as determined in
   accordance with the provisions of Section 12.5.  Except to the
   extent provided for in the Closing Date Statutory Statements,
   Seller shall pay its allocable share of all Taxes due with respect
   to such Tax Returns under this paragraph (j), regardless of when
   such Taxes are determined to be due.  Purchaser agrees to provide
   to Seller complete copies of all such Tax Returns no later than the
   time period prescribed in paragraph (i) above.
   
             (k)  Seller and Purchaser agree that the Tax Returns
   filed pursuant to paragraphs (h) and (j) above will reflect the
   transactions related to the Business Transfer described in
   Section 7.13 of the Agreement.
   
             (l)  In the event that the IRS or any other taxing
   authority collects from Purchaser or any Acquired Company (i) any
   amount of Taxes attributable to taxable periods that end on or
   prior to Closing or (ii) any  amount of Taxes assumed by the Seller
   under the provisions of this Article, Purchaser or such Acquired
   Company shall be entitled to prompt, full reimbursement from Seller
   upon demand for such Tax after payment of such Tax by Purchaser or
   such Acquired Company to the taxing authority (to the extent not
   reserved for on the Closing Date Statutory Statements). 
   Notwithstanding the prior sentence, Seller's liability for Taxes
   under this Section 12.2(l) shall be  adjusted to reflect any Tax
   Benefit from the payment of such Tax by Purchaser or such Acquired
   Company. 
   
             (m)  Seller shall have no obligation to indemnify the
   Purchaser or the Acquired Companies pursuant to this Article XII
   with respect to any Potential Tax Liability if (i) the Acquired
   Companies or Purchaser failed to give notice as required in
   Section 12.4(j) hereof (excluding any failure when the Seller has
   actual knowledge of the Potential Tax Liability, or in
   circumstances in which it is not reasonably practicable for the
   Acquired Companies or Purchaser to notify Seller prior to
   themselves paying such Potential Tax Liability) and (ii) the
   ability of Seller to defend, negotiate, settle, or obtain refunds
   for such Potential Tax Liability was materially harmed by the
   failure of the Acquired Companies or Purchaser to give such notice.
   
             (n)  Immediately prior to the distributions referred to
   in Section 7.13 of the Agreement and the sale and purchase of the
   Shares, Seller shall cause each Acquired Company to adopt, solely
   for the tax purposes of Sections 332 and 338 of the Code, a plan
   that shall constitute a plan of complete liquidation.  The Business
   Transfer distributions pursuant to such Section 7.13 shall be made
   in accordance with such plans.  Seller shall present such plans to
   Purchaser for review at least 30 Business Days prior to Closing or
   the agreed upon date of the distributions, whichever is earlier.
   
        SECTION 12.3.  Representations, Warranties, Agreement, and
   Covenants of Purchaser with Regard to Certain Tax Matters
   
             Purchaser shall be responsible for the preparation of all
   Tax Returns for, or with respect to, each Acquired Company for any
   taxable period that ends after the Closing Date, and, to the extent
   such Taxes are not allocated or assumed by the Seller pursuant to
   Sections 12.2 and 12.5 herein, Purchaser and each Acquired Company
   shall be responsible for the payment of all Taxes due with respect
   to such Returns without reimbursement or indemnification from
   Seller.
   
        SECTION 12.4.  Joint Agreements and Covenants of Seller and
   Purchaser
   
             (a)  Purchaser and Parent shall allocate the Share
   Purchase Price and the Note Purchase Price in accordance with
   Section 1060 of the Code and the Treasury Regulations thereunder,
   and such allocation shall be used for purposes of determining the
   modified aggregate deemed sales price under applicable Treasury
   Regulations and in reporting the deemed sales of assets of the
   Company and its Acquired Subsidiaries in connection with the
   Section 338(h)(10) Elections.  Any adjustment to the Purchase Price
   or other consideration paid pursuant to this Agreement shall result
   in an appropriate adjustment to such allocation.
   
             (b)  Seller and Purchaser agree to join in making
   elections under section 338(g) and section 338(h)(10) of the Code
   and all comparable elections under state and local tax law
   (together, the "Section 338(h)(10) Elections") with respect to each
   of the Acquired Companies.  Notwithstanding any other provision in
   the Agreement or this Article XII, Purchaser (including the
   Acquired Companies), on the one side, and Seller, on the other
   side, shall bear their respective administrative, legal,
   accounting, and similar expenses resulting from the making of the
   Section 338(h)(10) Elections.
   
             (c)  Seller and Purchaser agree to cooperate fully with
   respect to the making of the Section 338(h)(10) Elections.  Such
   cooperation shall include, but not be limited to, the calculation
   of Adjusted Grossed-Up Basis, within the meaning of Treasury
   Regulation section 1.338(b)-1, the allocation of the Purchase Price
   in accordance with Section 12.4(g) below, and the preparation and
   delivery of any other related documentation required by the
   applicable taxing authorities.
   
             (d)  Purchaser shall prepare for delivery to Seller for
   review a fully completed set of IRS Form 8023-A and, if required,
   Form 8594, including all additional data and materials required to
   be attached to such Form 8023-A pursuant to the Treasury
   Regulations under section 338 of the Code. Such documents and forms
   shall be delivered to Parent or Seller for review by the earliest
   of (i) the tenth Business Day following the date Parent and
   Purchaser deem the Closing Date Financial Statements final, and
   (ii) the 45th Business Day prior to the date any such Section 338
   or 1060 forms are to be filed.
   
             (e)  Purchaser agrees to attach a copy of the agreed upon
   Form 8023-A (including Form 8594, to the extent required) referred
   to in Section 12.4(d) above, to the first federal income Tax Return
   (and any other applicable Tax Returns) filed for each of the
   Acquired Companies for the period beginning immediately after the
   Closing Date.  Seller agrees to attach a copy of such agreed upon
   Form 8023-A (including Form 8594, to the extent required) to the
   consolidated federal income Tax  Return (and any other applicable
   Tax Returns) in which Seller joins for the taxable period that
   includes the Closing Date.  The Parties agree to timely file such
   Tax Returns, including any extensions.
   
             (f)  Seller and Purchaser agree to treat the deemed
   transfer of the Acquired Companies' insurance contracts that will
   occur pursuant to the Section 338(h)(10) Elections as deemed
   assumption reinsurance transactions for federal income tax
   purposes.  Moreover, Seller and Purchaser agree to treat such
   deemed reinsurance transactions consistently for federal income tax
   purposes, and consistently report the nature and amount of any
   deemed ceding commissions, as determined in Section 12.4(g) below.
   
             (g)  No later than 60 days after the date of the
   Agreement, Seller and Purchaser agree to consult with each other in
   order to agree to the methodology for the allocation of the
   Purchase Price to the assets conveyed pursuant to the Agreement and
   to determine ceding commissions for the deemed reinsurance
   transactions resulting from the Section 338(h)(10) Elections, in
   each case using reasonable valuation methodologies.  If the Parties
   have agreed to the asset allocation, including the amount of any
   deemed ceding commissions (the "Allocation Agreement"), such
   agreement shall be reduced to writing prior to the Closing Date.
   
             (h)  Seller and Purchaser agree, and Purchaser shall
   cause the Acquired Companies, to retain all Tax or Tax-related
   records associated with the Acquired Companies for periods ending
   on or before the Closing Date until the expiration of the full
   period of the applicable statute of limitations, including any
   extensions thereof.  If the applicable statute of limitations have
   not expired by the end of the tenth year following the Closing
   Date, the Purchaser shall have the option of transferring the
   records to the Seller or Parent for their storage.  Each party
   agrees to notify the other of any extension of an applicable
   statute of limitations and each party shall  make a good faith
   effort to obtain the consent of the other party before destroying
   any of such records after the expiration of the statute of
   limitations period.
   
             (i)  Purchaser and Seller shall cooperate, and Purchaser
   shall cause the Acquired Companies to cooperate with Seller, with
   respect to the preparation and filing of any Tax Return (including
   amended Tax Returns) for which the other is responsible pursuant to
   this Article XII (including, but not limited to, providing work
   papers and schedules).
   
             (j)  Except as otherwise provided with respect to items
   relating to the allocation of the Purchase Price for the deemed
   sale of assets resulting from the making of the Section 338(h)(10)
   Elections, Purchaser shall prepare or cause the Acquired Companies
   to prepare, in a manner and at such time or times as is consistent
   with past practice but no later than May 1, 1996, the tax work
   paper preparation package or packages necessary to enable Seller to
   prepare consolidated federal and combined state and local Tax
   Returns for the period or periods from January 1, 1995 through the
   Closing Date.
   
             (k)  Purchaser and Seller each agree promptly to notify
   the other in writing within 30 Business Days from the receipt of
   notice of any pending or threatened tax audits or assessments
   ("Potential Tax Liability") of the Acquired Companies for any
   taxable periods ending on or before the Closing Date as long as
   such periods remain open.  The written notification shall contain
   information, to the extent known by the Purchaser or the Acquired
   Companies (or the Seller, as the case may be), describing the
   Potential Tax Liability.  With respect to any Potential Tax
   Liability that does not potentially affect the tax liability of any
   of the Acquired Companies for a tax period that includes or follows
   the Date of Closing, Seller shall have the sole right to represent
   the interests of the Acquired Companies in any tax audit or
   administrative or court proceeding to the extent relating to Taxes
   or Tax Returns filed for, or with respect to, the Acquired
   Companies for periods ending on or before the Closing Date.  With
   respect to any Potential Tax Liability that  potentially affects
   the tax liability of any of the Acquired Companies for a tax period
   that includes or follows the Date of Closing, Seller shall give due
   consideration to the interests of the Acquired Companies, and shall
   have the primary right to represent the interests of the Acquired
   Companies in any tax audit or administrative or court proceeding to
   the extent relating to Taxes or Tax Returns filed for, or with
   respect to, the Acquired Companies for periods ending on or before
   the Closing Date.  Seller may employ counsel of its choice at its
   expense, provided that Seller shall keep Purchaser reasonably
   informed on an ongoing basis.  Purchaser shall cooperate, and shall
   cause the Acquired Companies to cooperate, with Seller, with
   respect to any tax audit or administrative or court proceeding
   referred to in this paragraph.  Such cooperation shall include
   providing all relevant information that is available to Purchaser
   or the Acquired Companies, as the case may be, with respect to any
   such audit or proceeding, making personnel available at reasonable
   times and, including, without limitation, preparation of responses
   to requests for information, provided that the foregoing shall be
   done in a manner so as not to interfere unreasonably with the
   conduct of the business of Purchaser and the Acquired Companies. 
   Seller shall notify Purchaser at least 30 Business Days prior to
   settling or otherwise resolving any Potential Tax Liability that is
   likely to have a negative Tax detriment on any of the Acquired
   Companies after the Closing Date.  If Purchaser objects to the
   proposed settlement or resolution within the above 30 Business Day
   period, Purchaser may elect at its sole expense to further contest
   the Potential Tax Liability in which case Purchaser will indemnify
   Seller to the extent final settlement or other resolution of the
   Potential Tax Liability is on terms less favorable to Seller than
   the settlement or resolution proposed by Seller.  If Seller fails
   to provide notice to Purchaser under this section or fails to
   permit Purchaser to contest the Potential Tax Liability pursuant to
   the immediately preceding sentence, then in the event that the
   Seller settles or otherwise resolves any Potential Tax Liability
   that is likely to have a negative Tax detriment on any of the
   Acquired Companies, the Acquired Company will be entitled to
   receive prompt payment from the Seller of the detriment, determined
   under the Tax Benefit provisions of Section 12.6.  Purchaser shall
   notify Seller at least 30 Business Days prior to settling or
   otherwise resolving any Potential Tax Liability that is likely to
   have a negative Tax detriment on any of the Acquired Companies
   prior to the Closing Date.  If Seller objects to the proposed
   settlement or resolution within the above 30 Business Day period,
   Seller may elect at its sole expense to further contest the
   Potential Tax Liability in which case Seller will indemnify
   Purchaser to the extent final settlement or other resolution of the
   Potential Tax Liability is on terms less favorable to Purchaser
   than the settlement or resolution proposed by Purchaser.  If
   Purchaser fails to provide notice to Seller under this section or
   fails to permit Seller to contest the Potential Tax Liability
   pursuant to the immediately preceding sentence, then in the event
   that the Purchaser settles or otherwise resolves any Potential Tax
   Liability that is likely to have a negative tax detriment on
   Seller, the Seller will be entitled to receive prompt payment from
   the Purchaser of the detriment, determined consistently with the
   Tax Benefit provisions of Section 12.6.
   
             (l)  Seller shall have the right to pursue, and shall be
   entitled to retain, or receive prompt payment from the Acquired
   Companies or Purchaser of, any overpayment, refund or credit
   received by an Acquired Company or Purchaser with respect to Taxes
   (including, without limitation, refunds and credits arising by
   reason of Tax Returns as originally filed or amended Tax Returns
   filed after the Closing Date or adjustments by the IRS or
   comparable state or local taxing authorities) relating to the
   Acquired Companies that are the responsibility of Seller under this
   Article XII, plus any interest received with respect thereto from
   the applicable taxing authorities.   With respect to any request
   for refund, overpayment or credit that potentially affects the tax
   liability of any of the Acquired Companies for a tax period that
   includes or follows the Date of Closing, Seller shall give due
   consideration to the interests of the Acquired Companies, and shall
   have the primary right to represent the interests of the Acquired
   Companies in any tax audit or administrative or court proceeding to
   the extent relating to Taxes or Tax Returns filed for, or with
   respect to, the Acquired Companies for periods ending on or before
   the Closing Date.  Purchaser and Seller shall cooperate, and
   Purchaser shall cause the Acquired Companies to cooperate with
   Seller, with respect to claiming any refund or credit with respect
   to Taxes referred to in this Section 12.4(j).  Seller shall bear
   any out-of-pocket expenses incurred in seeking such refund or
   credit.  Seller shall notify Purchaser at least 30 Business Days
   prior to settling or otherwise resolving any Potential Tax
   Liability that is likely to have a negative Tax detriment on any of
   the Acquired Companies after the Closing Date.  If Purchaser
   objects to the proposed settlement or resolution within the above
   30 Business Day period, Purchaser may elect at its sole expense to
   further contest the Potential Tax Liability in which case Purchaser
   will indemnify Seller to the extent final settlement or other
   resolution of the Potential Tax Liability is on terms less
   favorable to Seller than the settlement or resolution proposed by
   Seller.  If Seller fails to provide notice to Purchaser under this
   section or fails to permit Purchaser to contest the Potential Tax
   Liability pursuant to the immediately preceding sentence, then in
   the event that the Seller settles or otherwise resolves any request
   for refund, overpayment or credit which is likely to have a
   negative tax detriment on any of the Acquired Companies, the
   Acquired Company will be entitled to receive prompt payment from
   the Seller of the detriment, determined under the Tax Benefit
   provisions of Section 12.6.  If, as the result of an examination by
   any taxing authority of any Tax Return or Tax of the Acquired
   Companies, (i) an adjustment is made which gives rise to a Tax
   deficiency payable by the Acquired Companies to such taxing
   authority that is attributable to any Tax period, or portion
   thereof, ending prior to or on the Closing Date, (ii) Seller or an
   Affiliate of Seller pays (or is obligated to pay) such deficiency
   or indemnifies (or is obligated to indemnify) Purchaser or the
   Acquired Companies under this Agreement for a payment of such
   deficiency, and (iii) such adjustment will reverse in a Tax period,
   or portion thereof, ending after the Closing Date, thereby
   producing a refund, credit, offset, or deduction to the Acquired
   Companies, Purchaser shall pay to Seller the amount of such Tax
   Benefit determined consistently with Section 12.6 below, within 30
   days after the Acquired Companies are notified by Seller of such
   adjustment.  However, if as the result of such an examination, (i)
   an adjustment is made which gives rise to a Tax Benefit to the
   Acquired Companies that is attributable to any Tax period ending
   prior to or on the Closing Date and (ii) such adjustment reverses
   in a Tax period ending after the Closing Date thereby producing a
   Tax detriment payable by the Acquired Companies to the taxing
   authorities, the Seller shall pay the amount of such Tax detriment,
   determined consistently with Section 12.6 below, to Purchaser
   within thirty days after demand is made by Purchaser to Seller for
   such payment.
   
             (m)  Sellers and Purchaser agree to cooperate in the
   prompt evaluation of a structure for the purchase of the Stock and
   the Note by Purchaser hereunder in which the Note is acquired by
   Purchaser from Parent for $50 million in cash and the Company,
   after giving effect to the Business Transfer and the dividend and
   other payments contemplated by Section 7.17, merges, in a
   transaction complying with Section 351 of the Code, into a direct
   or indirect subsidiary of Purchaser and Seller receives as
   consideration for the Stock in such merger cash in the amount of
   $475 million and preferred stock of such subsidiary of Purchaser
   that has characteristics that qualify it as stock under Section 351
   of the Code and has a face amount of $50 million and the terms
   mutually agreed by the Parties (the "Section 351 Transaction
   Structure").  Purchaser and Seller (i) agree to use their best
   efforts, if the conditions specified in the proviso below are
   satisfied, to effect the transactions contemplated hereunder
   pursuant to the Section 351 Transaction Structure and (ii) if the
   Section 351 Transaction Structure is implemented, agree that
   neither Seller nor Purchaser will make (or consent to be made) any
   Section 338(h)(10) Elections; provided that the Section 351
   Transaction Structure will not be utilized if the transactions
   contemplated hereby as modified by such structure (A) cannot be
   consummated on or prior to December 31, 1995, (B) have a Tax effect
   which is materially worse than Purchaser's federal, state and local
   Tax position if it had acquired the Stock and the Note directly
   from Parent and Seller without making a Section 338(h)(10)
   Election, (C) are likely to be deemed by any state insurance
   commissioner to constitute an assumption reinsurance transaction,
   (D) require the Company or the subsidiary of Purchaser as successor
   entity in the Section 351 Transaction Structure to be relicensed in
   any state; (E) require notice to or the consent of policyholders,
   (F) require the Acquired Companies' agents to be relicensed by any
   state insurance department, (G) require any new approvals from any
   state insurance department for any of the Acquired Companies'
   current products, (H) reduce the tax basis of Section 848 of the
   Code deferred acquisition costs which would have been otherwise
   available if the Stock had been acquired directly by Purchaser
   without making a Section 338(h)(10) Election or (I) have a Material
   Adverse Effect or materially adversely affect Purchaser; and
   provided further that if Seller and Purchaser have not jointly
   determined by September 30, 1995 that the foregoing conditions are
   likely to be satisfied, Seller and Purchaser agree that the
   Section 351 Transaction Structure will not be utilized and the
   transactions contemplated by this Agreement will be effected as
   provided in this Agreement without giving effect to this
   Section 12.4(m).
   
             If the Parties implement the Section 351 Transaction
   Structure pursuant to this Section 12.4(m), Parent will not
   purchase the building immediately prior to the transaction. 
   However, if the Section 351 Transaction Structure is implemented,
   but a final determination is made that Section 351 does not apply
   to the transaction and the Section 351 Transaction Structure is
   treated as an asset acquisition for Federal income tax purposes,
   Parent agrees to purchase the building referred to in Section 7.15
   on an "as is" basis without warranty, for a purchase price of $45
   million, adjusted to reflect a proration for utilities, taxes and
   other similar expenses, and upon such purchase the lease agreement
   relating to such building between Parent and the Company shall be
   terminated without additional expense to either party. A final
   determination for purposes of the immediately preceding sentence
   will consist of an adjustment to Taxes made by the IRS whether such
   adjustment is a result of or in settlement of any audit or other
   administrative proceeding or judicial proceeding or the filing of
   an amended return to reflect the consequences of any determination
   made in connection with any such audit or proceeding or otherwise,
   provided, however, that Purchaser will make a good faith effort, in
   consultation with Seller, to sustain the Section 351 Transaction
   Structure.  Parent's obligation to purchase the building under this
   provision shall expire on January 1, 2007.
   
             If the Parties agree prior to September 30, 1995 to
   implement the Section 351 Transaction Structure, and if Purchaser
   fails to close this transaction, Purchaser agrees to reimburse
   Seller for Seller's hedging costs incurred after September 30,
   1995, associated with the increased Tax cost that would result from
   an increase in the appreciation of the Company's assets.
   
        SECTION 12.5.  Straddle Period Tax Allocations  Any Taxes for
   a period that includes the Closing Date but does not terminate on
   such date (a "Straddle Period") shall be the joint responsibility
   of Purchaser and Seller, and shall be apportioned between the
   portion of the Straddle Period ending on the Closing Date and the
   portion beginning immediately after the Closing Date in accordance
   with this section.  Any Taxes allocable to the portion ending on or
   prior to the Closing Date will be the sole responsibility of
   Seller, and any Taxes allocable to the portion beginning after the
   Closing will be the sole responsibility of Purchaser.  Any Straddle
   Period Taxes based on actual activities or transactions (e.g., the
   Business Transfers, capital transactions, reinsurance outside the
   ordinary course of business, or real estate transfer taxes) shall
   be allocated based on the actual activities or transactions of each
   Acquired Company for such period.  All other Straddle Period Taxes
   (including all transaction related to regular, recurring items
   incurred in the ordinary course of business) shall be allocated
   based on the number of days in the portions of the Straddle Period
   before and after the Closing Date, respectively.
   
        SECTION 12.6.  Determination Of Tax Benefit  For purposes of
   this Article and the indemnification provisions of Article XI, any
   positive or negative Tax Benefit to a Party shall be determined in
   accordance with this Section.  If a Party actually derives, or is
   likely to derive, a benefit or suffer a detriment from (i) an
   increase (or decrease) in tax attributes, (ii) or the recognition
   of any item of income (or loss), the Tax Benefit (or detriment)
   shall be calculated.  The amount of the Tax Benefit (or detriment)
   shall be determined based on the present value of a refund, credit,
   offset, deduction, gain, or item of income and shall be determined
   using a discount rate equal to 12%, assuming that the Party will
   have sufficient taxable income and tax liability against which to
   use any such refund, credit, offset, or liability, and assuming an
   effective tax rate of 35%.
   
        SECTION 12.7.  Tax Dispute Resolution Mechanism  Any dispute
   with respect to this Article XII shall be resolved as follows:  the
   parties will in good faith attempt to negotiate a settlement of the
   dispute; if the parties are unable to negotiate a resolution of the
   dispute within 30 days after notice of such dispute is given by
   either party to the other party, the dispute will be submitted to
   (i) a nationally recognized accounting firm mutually agreed upon by
   Seller and Purchaser or (ii) if the Seller and Purchaser are unable
   to agree upon an accounting firm, each Party will select an
   accounting firm, and representatives of those firms will pick a
   nationally recognized accounting firm to resolve the dispute  (the
   "Tax Dispute Accountants").  The parties will present their
   arguments to the Tax Dispute Accountants within 15 days after
   submission of the dispute to the Tax Dispute Accountants.  The Tax
   Dispute Accountants will resolve the dispute, in a fair and
   equitable manner and in accordance with the applicable tax law,
   within 30 days, or as expeditiously as possible, after the parties
   have presented their arguments to the Tax Dispute Accountants,
   whose decision shall be final, conclusive and binding on the
   parties.  The fees and expenses of the Tax Dispute Accountants in
   resolving a dispute will be borne equally by Seller and Purchaser.
   
   
                             ARTICLE XIII.
                       MISCELLANEOUS PROVISIONS
   
        SECTION 13.1.  Entire Agreement; Waiver
   
        This Agreement, the Annexes and the exhibits attached hereto
   and the other writings specifically identified herein or executed
   and delivered by the Parties to be bound thereby in conjunction
   with this Agreement or the transactions contemplated hereby contain
   the entire agreement among the Parties with respect to the
   transactions contemplated hereby and thereby and supersede all
   previous written or oral negotiations, commitments, and writings. 
   No supplement or waiver of this Agreement shall be binding unless
   executed in writing and signed by the Party to be bound thereby. 
   No waiver of any of the provisions of this Agreement shall be
   deemed or shall constitute a waiver of any other provision hereof
   (whether or not similar), nor shall such waiver constitute a
   continuing waiver unless otherwise expressly provided.
   
        SECTION 13.2.  Amendment and Modification
   
             Subject to applicable law, this Agreement may be amended,
   modified, or supplemented only by written agreement of the Parties.
   
        SECTION 13.3.  Confidentiality
   
             (a)  None of the Parties to this Agreement nor any of
   their Affiliates shall issue any press release or public
   announcement concerning the contemplated transaction, the existence
   of this Agreement, or of the terms, conditions, and provisions of
   this Agreement (i) unless mutually agreed by Seller and Purchaser
   or (ii) except as required by law, in which event the disclosing
   Party shall consult with the other Parties to the extent
   practicable before making such disclosure.
   
             (b)  Each of the Parties and its respective Affiliates
   shall use reasonable precautions to keep confidential, in
   accordance with its customary procedures for handling confidential
   information of this nature and in accordance with safe and sound
   practices, any non-public information supplied to it by any other
   Party pursuant to this Agreement that is identified by such other
   Party as being confidential at the time the same is delivered to
   such Party, including without limitation, the negotiations between
   the Parties relating to the execution of this Agreement and the
   terms and conditions of this Agreement, to the extent that they are
   not in the public domain.  Such information shall be kept
   confidential and shall not be disclosed by the Parties otherwise
   than to each other; provided, that nothing herein shall limit the
   disclosure of any such information
   
                  (i)  to the extent required by statute, rule,
             regulation, or judicial process;
   
                  (ii) to governmental authorities, or representatives
             thereof, or regulatory personnel, auditors, or
             accountants;
   
                  (iii) in connection with any litigation to which
             any one or more of the Parties or an Affiliate is a
             party;
   
                  (iv) to counsel for any of the Parties; or
   
                  (v)  to a subsidiary or Affiliate of such Party;
   
   in the case of Sections 13.3(b)(i), (ii), and (iii), if such person
   to whom such confidential information is given is notified that
   such information is confidential, and in the case of Sections
   13.3(b)(iv) and (v) if such person to whom such confidential
   information is given agrees to be subject to the same strictures on
   disclosure as are set forth in this Agreement.
   
             (c)  In the event that any Party receives a request to
   disclose any non-public information of another Party under a
   subpoena or judicial or administrative order, such Party shall, to
   the extent not prohibited by law or such legal process,
   
                  (i)  notify the other Parties thereof within ten
             (10) days after receipt of such request;
   
                  (ii) consult with the other Parties, on the
             advisability of taking steps to resist or narrow such
             request and cooperate with the other Parties in resisting
             such disclosure, if requested; and
   
                  (iii) if disclosure is required or deemed
             advisable, cooperate with the other Parties in any
             attempt that it may make to obtain an order or other
             reliable assurance that confidential treatment will be
             accorded to designated portions of the non-public
             information.
   
        SECTION 13.4.  Specific Performance
   
             Each of the Parties acknowledges that money damages would
   not be a sufficient remedy for any breach of this Agreement for
   failure to close and that irreparable harm would result if this
   Agreement were not specifically enforced.  Therefore, if any Party
   intentionally fails to take any action required to be taken by it
   under the terms of this Agreement, the rights and obligations of
   the Parties under this Agreement shall be enforceable by a decree
   of specific performance issued by any court of competent
   jurisdiction, and appropriate injunctive relief may be applied for
   and granted in connection therewith.  A Party's right to specific
   performance shall be in addition to all other legal or equitable
   remedies available to such Party.
   
        SECTION 13.5.  Expenses
   
             Each Party hereto shall bear its own expenses, including
   the fees of any attorneys, accountants, or others engaged by such
   Party, in connection with this Agreement and the transactions
   contemplated hereby, except as otherwise expressly provided herein.
   
        SECTION 13.6.  Notices
   
             All notices, requests, demands, consents, approvals,
   agreements, or other communications to or by a Party to this
   Agreement shall:
   
             (a)  be in writing addressed to the authorized address of
   the recipient set out in this Section 13.6 or to such other address
   as it may have notified the sender;
   
             (b)  be signed by an authorized officer of the sender;
   and
   
             (c)  be delivered in person or sent by registered or
   certified mail return receipt requested or facsimile transmission
   and be deemed to be duly given or made:
   
                  (i)  in the case of delivery in person when
             delivered to the recipient at such address; or
   
                  (ii) in the case of facsimile transmission when
             received in legible form by the recipient at such address
             and when the recipient has been requested to acknowledge
             receipt of the entire facsimile transmission upon the
             sending or receiving the acknowledgment of receipt (which
             acknowledgment the recipient will promptly give);
   
   but if such delivery or dispatch is later than 5:00 pm local time
   on a day on which business is generally carried on in the place to
   which such communication is sent or occurs on a day on which
   business is not generally carried on in the place to which such
   communication is sent, it will be deemed to have been duly given or
   made at the commencement of business on the next day on which
   business is generally carried on in that place.
   
        Notices to Purchaser may be sent to
   
             Jefferson-Pilot Corporation
             P.O. Box 21008
             Greensboro, North Carolina 27420
             Attention: Chief Financial Officer
             Telephone No: (910) 691-3441
             Facsimile No:  (910) 691-3283
   
        with a copy to:
   
             Jefferson-Pilot Corporation
             P.O. Box 21008
             Greensboro, North Carolina 27420
             Attention: General Counsel
             Telephone No: (910) 691-3308
             Facsimile No:  (910) 691-3639
   
             King & Spalding
             120 West 45th Street
             New York, New York 10036
             Attention: E. William Bates, II, Esq.
             Telephone No:  (212) 556-2100
             Facsimile No:   (212) 556-2222
   
   Notices to Seller and Parent may be sent to
   
             Household International, Inc.
             2700 Sanders Road
             Prospect Heights, Illinois 60070
             Attention: Office of the Secretary
             Telephone No: 708-564-5000
             Facsimile No: 708-205-7536
   
   with a copy to:
   
             Russell J. Bruemmer, Esq.
             Wilmer, Cutler & Pickering
             2445 M Street, N.W.
             Washington, D.C.  20037-1420
             Telephone No:  202-663-6804
             Facsimile No:  202-663-6363
   
        SECTION 13.7.  Severability
   
             If any one or more of the provisions of this Agreement
   shall be held to be invalid, illegal, or unenforceable, the
   validity, legality and enforceability of the remaining provisions
   of this Agreement shall not be affected thereby.  To the extent
   permitted by applicable law, each Party hereto waives any provision
   of law which renders any provision of this Agreement invalid,
   illegal, or unenforceable in any respect, unless material to the
   purpose of this Agreement.
   
        SECTION 13.8.  Assignment
   
             This Agreement and all of the provisions hereof shall be
   binding upon and inure to the benefit of the Parties hereto and
   their respective successors and permitted assigns, but neither this
   Agreement nor any of the rights, interests, or obligations
   hereunder shall be assigned by either of Sellers or Purchaser
   hereto without the prior written consent of the other Parties, nor
   is this Agreement intended to confer upon any other person except
   the Parties any rights or remedies hereunder; provided that
   Purchaser may assign all or any portion of its respective rights,
   interests or obligations hereunder to an Affiliate of Purchaser
   without the prior written consent of Parent, Seller or the Company,
   provided that such assignment shall not release Purchaser from, or
   in any manner limit, Purchaser's obligations hereunder.
   
        SECTION 13.9.  Third Parties.
   
             Nothing in this Agreement is intended to confer any right
   on any person other than the Parties hereto and their respective
   successors and assigns and the persons identified in Sections 11.2
   and 11.3; nor is anything in this Agreement intended to modify or
   discharge the obligation or liability of any third person to any
   Party to this Agreement, nor shall any provision give any third
   person any right of subrogation or action over against any Party to
   this Agreement.  
   
        SECTION 13.10.  Captions
   
             The captions in this Agreement are for convenience only,
   do not form a part hereof, and do not in any way modify, interpret,
   or construe the intentions of the Parties hereto.
   
        SECTION 13.11.  Governing Law
   
             This Agreement shall be governed by the laws of the State
   of Michigan (regardless of the laws that might otherwise govern
   under applicable principles of conflicts of law).
   
        SECTION 13.12.  Choice of Forum
   
             Any judicial proceeding brought against any of the
   Parties hereto with respect to this Agreement shall be brought in
   any court of competent jurisdiction in the Eastern District of
   Michigan or Oakland County, Michigan, irrespective of where such
   Party may be located at the time of such proceeding, and by
   execution and delivery of this Agreement, each of the Parties to
   this Agreement hereby consents to the exclusive jurisdiction of any
   such court and waives any defense or opposition to such
   jurisdiction.
   
        SECTION 13.13.  WAIVER OF JURY TRIAL
   
             EACH PARTY HERETO WAIVES, TO THE FULLEST EXTENT PERMITTED
   BY APPLICABLE LAW, THE RIGHT TO TRIAL BY JURY IN ANY LEGAL
   PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
   TRANSACTIONS CONTEMPLATED HEREBY.
   
        SECTION 13.14.  Counterparts
   
             This Agreement may be executed in two or more
   counterparts, each of which shall be deemed an original but all of
   which shall constitute one and the same instrument.
   
        SECTION 13.15.  Drafting
   
             Each Party acknowledges that its legal counsel
   participated in the preparation of this Agreement.  The Parties
   therefore stipulate that the rule of construction that ambiguities
   are to be resolved against the drafting Party shall not be employed
   in the interpretation of this Agreement to favor any Party against
   the other.
   
        SECTION 13.16.  Books and Records
   
             Seller and Purchaser agree that, so long as any books,
   records, and files relating to the business, properties, assets, or
   operations of the Company or its subsidiaries, to the extent that
   they pertain to the operations of the Company or its subsidiaries
   prior to the Closing Date, remain in existence and are available,
   on and after the Closing Date each Party (at its expense) shall
   have the right to inspect and to make copies of the same at any
   time during business hours for the purpose of complying with
   regulatory requirements, meeting auditing needs, or fulfilling
   similar obligations for which such books, records, or files are
   reasonably necessary.
   
        SECTION 13.17.  Governmental Notices
   
             After Closing, Purchaser shall provide to any
   governmental or regulatory authority with jurisdiction over such
   matters, all required notices of the consummation of this
   transaction.
   
        SECTION 13.18.  Exhibits
   
             Disclosure of any fact or item in any Exhibit to this
   Agreement referenced to a particular Section of this Agreement
   shall, should the existence of the fact or item or its contents be
   relevant to any other Section, be deemed to be disclosed with
   respect to that other Section whether or not an explicit cross-
   reference appears; provided, that the nature of any matter
   disclosed by such fact or item is reasonably apparent from the
   context of the disclosed fact or item without reference to any
   collateral document.
   
             [The remainder of this page is intentionally blank]<PAGE>
             IN WITNESS WHEREOF, the Parties hereto have executed this
   Stock Purchase Agreement as of the date first above written.
   
                                 HOUSEHOLD GROUP INC.
   
   
                                 By: ___________________________
                                       Name:
                                       Title:
   
   
                                 HOUSEHOLD INTERNATIONAL, INC.
   
   
                                 By: ______________________________
                                       Name:
                                       Title:
   
   
                                 ALEXANDER HAMILTON LIFE
                                 INSURANCE COMPANY OF AMERICA
   
   
                                 By: ______________________________
                                       Name:
                                       Title:
   
   
                                 JEFFERSON-PILOT CORPORATION
   
   
                                 By: ______________________________
                                       Name:
                                          Title:

                          ANNEX A
   
     STATEMENT OF TERMS OF AFFILIATED BUSINESS TRANSFER
   
   1.          Affiliated Business Reinsurance.  Prior to the Closing
                  Date, the Affiliated Business will be transferred from the
                  Company and First Alexander Hamilton Life Insurance
                  Company ("FAHLIC") to Hamilton National Life Insurance
                  Company ("HNLIC") and each of the Company and FAHLIC, on
                  the one hand, and HNLIC, on the other hand, will each
                  enter into an Affiliated Business Reinsurance Agreement
                  which will together provide 100% reinsurance of the
                  Affiliated Business Liabilities.  The Affiliated Business
                  Assets (including surplus assets) and Affiliated Business
                  Liabilities to be transferred in connection with such
                  Affiliated Business Reinsurance Agreements will be as
                  mutually agreed by the Parties, consistent with the
                  allocation of assets to be retained with respect to the
                  Individual Business as reflected in the Asset Allocation
                  Understanding, dated as of August 9, 1995, by and between
                  Parent and Purchaser; provided that to the extent that the
                  specific assets identified on Exhibit A-1 would not
                  otherwise be Affiliated Business Assets they will be
                  transferred to HNLIC, Parent or any subsidiary or
                  affiliate of Parent not involved in the Business, in
                  substitution for Affiliated Business Assets that are
                  reasonably acceptable to Purchaser.  The aggregate amounts
                  of assets, surplus and liabilities to be transferred will
                  be calculated consistently with the amounts shown on
                  Exhibit A-2 attached hereto (e.g., at December 31, 1994,
                  the Affiliated Business Assets to be transferred would
                  have aggregated $162.6 million and $164.7 million on a
                  statutory and GAAP basis, respectively, and the Affiliated
                  Business Liabilities to be assumed would have aggregated
                  $111.9 million and $84.5 million on a statutory and GAAP
                  basis, respectively).
   
     The Affiliated Business Reinsurance Agreements will be
        structured so as to ensure the Company's and FAHLIC's ability to
        receive proper reserve credits for the amounts ceded, including,
        if necessary to receive reserve credits, a reinsurance trust and
        Parent will undertake or cause to be undertaken any and all
        actions required for the Company and FAHLIC to so receive such
        reserve credits.  In addition, any Reinsurance Treaties relating
        to the Affiliated Business will be concurrently assigned to
        HNLIC.  HNLIC and Parent will use their best efforts to convert
        the Affiliated Business Reinsurance Agreements into agreements
        providing assumption reinsurance of the Affiliated Business
        within four years of the Closing Date; provided that on the
        fourth anniversary of the Closing Date the Affiliated Business
        Reinsurance Agreements will be converted to assumption
        reinsurance, subject to regulatory approvals and constraints. 
   
   2.          Dividend of Retained Subsidiaries.  After the execution of
                  the Affiliated Business Reinsurance Agreements, the
                  Company will distribute all outstanding capital stock in
                  the Retained Subsidiaries (including HNLIC) to Seller. 
   
   3.          New Business.  The Affiliated Business Reinsurance
                  Agreements will provide that the Company and FAHLIC will
                  continue to make their policies available to Parent and
                  its Affiliates for a maximum of 18 months, as necessary. 
                  Parent will use its best efforts to expeditiously obtain
                  necessary product approvals, agent licensing, and all
                  other licenses, authorizations and approvals necessary for
                  HNLIC to undertake the Affiliated Business, or make other
                  arrangements to discontinue sales of Affiliated Business
                  policies through the Company and FAHLIC; provided that in
                  no event will any sales be made through the Company and
                  FAHLIC more than 18 months following the Closing Date. 
                  The Company and FAHLIC will be reimbursed for all premium
                  taxes, and for each of the 18 months following the Closing
                  Date, the Company will receive a noncancellable fee of
                  $150,000 per month.  In addition, beginning January 1,
                  1996, the Company and FAHLIC will charge a fee equal to 2%
                  of premiums on new business written.
   
   4.          Employee Matters.  The Parties agree to work together to
                  make an appropriate and fair allocation of employees to
                  the Affiliated Business with primary consideration given
                  to historical employee relationships and cost allocations. 
                  Such employees will be retained by Parent or HNLIC as of
                  the Closing Date.
   
   5.          Provision for Administrative Expenses.  The Affiliated
                  Business Reinsurance Agreements will provide for
                  reimbursement to the Company and FAHLIC for all costs
                  reasonably related to the administration of the Affiliated
                  Business.
   
   6.          Office Facilities.  Parent, or its designated subsidiary,
                  will continue to occupy and rent office space for the
                  Affiliated Business from the Company at Farmington Hills,
                  Illinois for a rent of $15.74 per square foot for a term
                  of 5 years terminable by either party at any time upon six
                  months' prior notice.  The Parties agree to work together
                  to make an appropriate and fair allocation of the office
                  equipment and other related assets historically utilized
                  in the Affiliated Business, which upon the execution of
                  the Affiliated Business Reinsurance Agreements will be
                  transferred by the Company to Parent, or its designated
                  subsidiary, "AS IS," "WHERE IS" and without representation
                  or warranty.
   
   7.          Parent Guarantee.  Parent will unconditionally guarantee
                  the payment obligations of HNLIC under the Affiliated
                  Business Reinsurance Agreements and other agreements. 
                  Purchaser agrees that Parent's guarantee may be assumed by
                  any purchaser of HNLIC and the Affiliated Business;
                  provided that such purchaser has a Standard & Poor's
                  Corporation credit rating of A or better and that the
                  assumption is evidenced by properly executed assumption
                  and guarantee documents reasonably satisfactory to
                  Purchaser.
   
   8.          Other Items.  The Affiliated Business Reinsurance
                  Agreements and any trust arrangements required hereunder
                  will comply with applicable state laws and regulations to
                  ensure proper reserve credits, including New York State
                  Insurance Regulation 144, and Parent will cause any
                  necessary action to be taken to maintain such compliance.
   
   9.          Regulatory Limitations.  In the event that HNLIC is unable
                  to reinsure 100% of the Affiliated Business Liabilities
                  originated by FAHLIC, then FAHLIC will discontinue sales
                  of Affiliated Business policies as of a date not later
                  than the 90th day after the Closing Date.
   
   
   10.         Documentation.  The form of Affiliated Business
                  Reinsurance Agreements and any documentation to be
                  executed by the Parties pursuant to this Annex A shall be
                  approved by Purchaser, such approval not to be
                  unreasonably withheld.
   
   11.         Tax Effect.  For all Tax periods ending after the Closing
                  Date, for Tax purposes the net positive and net negative
                  consideration received by the ceding and assuming
                  companies will be adjusted, if necessary, to be tax
                  neutral to the Parties on an ongoing basis, including any
                  changes in tax laws.  Purchaser or Seller, as the case may
                  be, shall consult with the other party prior to taking any
                  position or paying any Taxes that could result in an
                  adjustment under this paragraph.  Following such
                  consultation, neither party shall refuse to take any
                  reasonable position for Tax purposes that would reduce or
                  eliminate any such adjustment.
Exhibit A  
Certain Assets to be transfered to the Affiliated Business

Private Placements                   Book Value

Beaver Valley Nuclear                $ 375,351
El Paso Electric                             0
Total                                $375, 351
   
   

                          ANNEX B
   
        STATEMENT OF TERMS OF COLI BUSINESS TRANSFER
   
   
   1.     COLI Business Reinsurance.  Prior to the Closing Date, the COLI
             Business will be transferred from the Company to Hamilton
             National Life Insurance Company ("HNLIC"), and the Company and
             HNLIC will enter into the COLI Business Reinsurance Agreement
             that will provide 100% reinsurance of the COLI Business
             Liabilities.  The COLI Business Assets (including surplus
             assets) and the COLI Business Liabilities to be transferred in
             connection with such COLI Business Reinsurance Agreement will be
             as mutually agreed by the Parties, consistent with the
             allocation of assets, to be retained with respect to the
             Individual Business as reflected in the Asset Allocation
             Understanding, dated as of August 9, 1995, by and between Parent
             and Purchaser.  The aggregate amount of assets, surplus and
             liabilities to be transferred will be calculated consistently
             with the amounts shown on Exhibit B-1 attached hereto (e.g., at
             December 31, 1994, the COLI Business Assets to be transferred
             would have aggregated $517.9 million on a statutory and GAAP
             basis, and the COLI Business Liabilities to be assumed would
             have aggregated $516.9 million and $502.1 million on a statutory
             and GAAP basis, respectively). 
   
     HNLIC and Parent will use their best efforts to convert the COLI
        Business Reinsurance Agreement into an agreement providing
        assumption reinsurance of the COLI Business with an insurer that
        has a claims paying rating of A+ or better by Standard & Poor's
        Corporation ("S&P") within three years of the Closing Date or,
        alternatively, at its sole option HNLIC may replace all of the
        COLI Business with substitute issued policies within such time
        period; provided that with the prior written consent of the
        Company, not to be unreasonably withheld, HNLIC may designate up
        to two COLI Business cases to be excluded from such assumption
        reinsurance agreement or substitute insurance arrangements. 
        Parent will, from time to time, take any action as is necessary
        to cause HNLIC to meet the minimum capital and surplus standards
        of paragraphs 6 and 7, below.  Concurrently with the
        distribution of the capital stock of HNLIC to Seller, the
        Company will transfer to HNLIC the COLI Business Assets.
    
   2.     Dividend of HNLIC.   After the execution of the COLI Business
             Reinsurance Agreement, the Company will distribute all
             outstanding capital stock in HNLIC to Seller.
   
   3.     Provision for Administrative Expenses.  The COLI Business
             Reinsurance Agreement will provide for reimbursement to the
             Company for all costs reasonably related to its administration
             of the COLI Business.
   
   4.     Provision for Cost of Capital.  The Company will receive the
             following annual compensation on the statutory reserves ceded
             relating to the COLI Business, as determined at the end of each
             quarter:
   
               17.5 basis points for the first three years after
                  the Closing Date;
               20 basis points for the fourth year after the
                  Closing Date; and
               35 basis points for each following year after the
                  fourth year after the Closing Date; and
   
   Notwithstanding the foregoing, the annual compensation shall be 17.5
   basis points for all years after the Closing Date with respect to
   statutory reserves relating to any COLI Business cases (not to exceed
   2 COLI Business cases) excluded from the assumption reinsurance or
   substitute insurance arrangement described in Section 1 above.
   
   5.     Investment Guidelines for Trust Assets.  The Company will have a
             continuing interest in the quality of the COLI Business Assets
             acquired and held by HNLIC to satisfy the COLI Business
             Liabilities during the time period the COLI Business Reinsurance
             Agreement is in effect.  The COLI Business Assets will be held
             in trust by an unaffiliated third party for the benefit of the
             Company pursuant to a trust agreement (the "Trust Agreement")
             and will be invested in accordance with the following guidelines
             (all references to credit ratings are to S&P ratings):
   
     (i)  Authorized New Investments (which are not subject to an
             aggregate limitation)
   
               US Treasury and Agency obligations
               Public corporate bonds (investment grade only)
               Agency mortgage-backed securities and CMOs
               Rated residential whole-loan CMOs (AAA, AA, or A)
               Rated private placements (investment grade only)
               Other rated asset-backed securities ("ABS"),
                  including commercial mortgage-backed securities (AAA
                  or AA)
   
     (ii) Authorized New Investments (which are subject to an
             aggregate "basket" limitation of not more than 10% of the
             COLI Business Investment portfolio (excluding the amount
             of policy loans))
   
               Commercial mortgages
               Common stock
               Commercial mortgage-backed securities
               Any other investment authorized under insurance
                  codes (except prohibited investments)
   
     (iii)     Prohibited New Investments
   
          No investment will be made in:
   
               Equity real estate
               Affiliated entity obligations, except for the ABS
                  set out in (i) above
   
     (iv) Individual Credit Exposure Limits
   
               Direct US Government obligations - unlimited
               A rated and higher credits (including MBS/CMO) - $25
                  million
               BBB3 - BBB1 rated credits - $15 million
               Noninvestment grade assets - $5 million
               All basket and noninvestment grade assets - $5
                  million
   
     (v)  Portfolio Characteristics
   
               Fixed-income holdings rated below A cannot exceed
                  25% of portfolio (excluding the amount of policy
                  loans).
               Mortgage-backed securities, including CMOs and ABSs,
                  cannot exceed 30% of portfolio (excluding the amount
                  of policy loans).
   
     Exceptions or changes to the investment limitations will require
        the Company's prior written consent.
   
   6.     Minimum Capital and Surplus Requirements.  The Trust Agreement
             will have adequate provisions to ensure that HNLIC will maintain
             sufficient COLI Business Assets and other assets in the Trust to
             entitle the Company to take full financial statement credit for
             the COLI Business Reinsurance Agreement in all states and Parent
             will undertake or cause to be undertaken any and all actions
             necessary for the Company to so receive such reserve credits. 
             In order to maintain the Company's policyholder ratings, HNLIC
             will maintain a Risk Based Capital Ratio of at least 150% of
             Company Action Level Risk Based Capital.  Accordingly, pursuant
             to paragraph 7 below, Parent will be obligated to take any
             action necessary to maintain a Risk Based Capital Ratio of at
             least 150% of Company Action Level Risk Based Capital at all
             times under then applicable law.
   
   7.     Periodic Cash Flow Testing of Reserves.  HNLIC will perform
             annual cash flow testing for the COLI Business using appropriate
             actuarial Standards of Practice, as promulgated by the American
             Academy of Actuaries, and in compliance with then current NAIC
             regulations.  Provision will be made for a second expert
             actuarial opinion and reconciliation in the event the Company
             disagrees with HNLIC's calculation.  To the extent that this
             testing indicates the reserves are inadequate, Parent or HNLIC
             will take any action necessary to maintain adequate reserves.
   
   8.     Parent Guarantee.  In addition to its capital maintenance
             obligations, Parent will unconditionally guarantee the payment
             obligations of HNLIC under the COLI Business Reinsurance
             Agreement, and 
   
     A.   In the event of (i) a decline at any time in the
             consolidated net worth of Parent below $1.5 billion, as
             determined in accordance with GAAP or (ii) a change in
             control of Parent or HNLIC, then Parent will be obligated
             to take any action necessary so that HNLIC increases, and
             maintains, a Risk Based Capital Ratio to at least 250% of
             Company Action Level Risk Based Capital; provided that if
             within 90 days of either event such Risk Based Capital
             Ratio has not otherwise been increased in accordance with
             this paragraph A, the Company will have the right to
             terminate the COLI Business Reinsurance Agreement, by
             recapturing the COLI Business Assets and the COLI Business
             Liabilities at a price agreed by Parent and the Company or
             at the fair market value as determined through arbitration
             by an actuarial or accounting firm, satisfactory to Parent
             and the Company, or an actuarial or accounting firm
             selected by firms selected by each of Parent and the
             Company, it being understood that the price will be first
             determined and then the Company will have 90 days from the
             date of such determination in which to exercise such
             option.  
   
     B.   In the event that HNLIC's Risk Based Capital Ratio is
             below 150% of Company Action Level Risk Based Capital for
             90 days, the Company will have the right to terminate the
             COLI Business Reinsurance Agreement, by recapturing the
             COLI Business Assets and the COLI Business Liabilities at
             a price agreed by Parent and the Company or at the fair
             market value as determined through arbitration by an
             actuarial or accounting firm, satisfactory to Parent and
             the Company, or an actuarial or accounting firm selected
             by firms selected by each of Parent and the Company, it
             being understood that the price will be first determined
             and then the Company will have 90 days from the date of
             such determination in which to exercise such option.
   
     C.   In the event that Parent has an S&P credit rating less
             than BBB-, Parent and the Company will agree to, or
             determine through arbitration by an actuarial or
             accounting firm, satisfactory to Parent and the Company,
             or an actuarial or accounting firm selected by firms
             selected by each of Parent and the Company, the fair
             market value of the COLI Business Assets and the COLI
             Business Liabilities.  To the extent that the value of the
             COLI Business Liabilities exceeds the value of the COLI
             Business Assets, Parent will transfer assets to the Trust
             satisfactory to the Company with a fair market value equal
             to such difference or arrange for a letter of credit for
             150% of such difference to be issued by a financial
             institution with an S&P credit rating of at least A, for
             the benefit of the Trust; provided that if within 90 days
             of such event Parent has not provided such assets or
             letter of credit, to the extent required, the Company will
             have the right to terminate the COLI Reinsurance
             Agreement, by recapturing the COLI Business Assets and the
             COLI Business Liabilities at a price agreed by Parent and
             the Company or at the fair market value as determined
             through arbitration by an actuarial or accounting firm,
             satisfactory to Parent and the Company, or an actuarial or
             accounting firm selected by firms selected by each of
             Parent and the Company, it being understood that the price
             will be first determined and then the Company will have 90
             days from the date of such determination in which to
             exercise such option.  At the end of each 12 month period
             commencing on the date of such determination pursuant to
             the first sentence of this paragraph C, and on each
             anniversary date thereof thereafter in which Parent's S&P
             credit rating is less than BBB-, Parent and the Company
             will value the COLI Business Assets and the COLI Business
             Liabilities and, if determined to be necessary, Parent
             will transfer assets satisfactory to the Company with a
             fair market value equal to such difference or arrange for
             a letter of credit in the same manner as described above;
             with the Company having a new option to terminate the COLI
             Business Reinsurance Agreement as described above if
             Parent does not provide such assets or letter of credit as
             provided above; provided that for the purpose of the
             foregoing calculation, the COLI Business Assets will not
             include the amount of any letter of credit then in effect;
             and provided, further that any letter of credit then in
             effect will remain in the Trust and in effect until the
             completion of the subsequent determination and the
             substitution of a new letter of credit in the Trust to the
             extent required.
   
          The guarantee of Parent provided hereunder will terminate
             to the extent, and at the time, of the assumption
             reinsurance or substitution of COLI Business cases in
             accordance to Section 1 above. 
   
   9.     Company Option to Terminate COLI Business Reinsurance Agreement. 
             The Company will have the right to terminate the COLI Business
             Reinsurance Agreement on the seventh anniversary of the Closing
             Date, by recapturing the COLI Business Assets and the COLI
             Business Liabilities at a price agreed by Parent and the Company
             or at the fair market value as determined through arbitration by
             an actuarial or accounting firm, satisfactory to Parent and the
             Company, or an actuarial or accounting firm selected by firms
             selected by each of Parent and the Company.
   
   10.    Reimbursement for Benefit Payments.  All benefit payments will
             be made by direct check or draft on HNLIC's bank accounts.    
   
   11.    Other Items.  The Trust Agreement and COLI Business Reinsurance
             Agreement will comply with applicable state laws and regulations
             to ensure proper reserve credits, including New York State
             Insurance Regulation 144, and Parent will cause any necessary
             actions to be taken to maintain such compliance.
   
   12.    Documentation.  The form of the COLI Business Reinsurance
             Agreement, the Trust Agreement and any documentation to be
             executed by the Parties pursuant to this Annex B shall be
             approved by Purchaser, such approval not to be unreasonably
             withheld.
   
   13.    Tax Effect.  For all tax periods ending after the Closing Date,
             for Tax purposes the net positive and net negative consideration
             received by the ceding and assuming companies will be adjusted,
             if necessary, to be tax neutral to the Parties on an ongoing
             basis, including any changes in tax laws.  Purchaser or Seller,
             as the case may be, shall consult with the other party prior to
             taking any position or paying any Taxes that could result in an
             adjustment under this paragraph.  Following such consultation,
             neither party shall refuse to take any reasonable position for
             Tax purposes that would reduce or eliminate any such adjustment.
   


Exhibit B-1, reference exhibit A-1






































   ANNEX C
   
          STATEMENT OF TERMS OF PPA BUSINESS TRANSFER
   
   
   1.     PPA Business Reinsurance.  Prior to the Closing Date, the PPA
Business will be transferred from the Company to AHLIC-AZ and PIC,
and the Company, on the one hand, and AHLIC-AZ and PIC, on the other
hand, will enter into PPA Business Reinsurance Agreements which will
together provide 100% reinsurance of the PPA Business Liabilities. 
The PPA Business Assets (including surplus assets) and PPA Business
Liabilities to be transferred in connection with such PPA Business
Reinsurance Agreements will be, as mutually agreed by the Parties,
consistent with the allocation of assets to be retained with respect
to the Individual Business as reflected in the Asset Allocation
Understanding dated as of August 9, 1995, by and between Parent and
Purchaser.
   
     The aggregate amounts of assets, surplus and liabilities to be
     transferred will be calculated consistently with the amounts shown
     on Exhibit C-1 attached hereto (e.g., at December 31, 1994, the PPA
     Business Assets to be transferred would have aggregated $1,555.6
     million and $1,532.1 million on a statutory and GAAP basis,
     respectively, and the PPA Business Liabilities to be assumed would
     have aggregated $1,505.1 million and $1,366.4 million on a statutory
     and GAAP basis, respectively).  Parent will, from time to time, take
     any action as is necessary to cause the PPA Companies to meet the
     minimum capital and surplus standards of paragraphs 7 and 8, below. 
     Concurrently with the distribution of the capital stock of the PPA
     Companies to Seller, the Company will transfer to the PPA Companies
     the PPA Business Assets.
   
  2.     Dividend of PPA Companies.  After the execution of the PPA Business
         Reinsurance Agreements, the Company will distribute all outstanding
         capital stock in the PPA Companies to Seller. 
   
   3.     New Business.  During the term of the PPA Business Reinsurance
          Agreements the PPA Companies will not initiate any new sales or
          incur any new insurance obligations and will not conduct any other
           business; provided that, solely for the purpose of, and in the
           amounts necessary for, maintaining life insurance company status,
          the PPA Companies may reinsure other blocks of business other than
          through the Trust so long as the PPA Companies, after entering into
            any such reinsurance arrangements, continue to comply with the
            requirements hereof.
   
  4.    Provision for Administrative Expenses.  The PPA Business Reinsurance
          Agreement will provide for reimbursement to the Company for all
         costs reasonably related to its administration of the PPA Business.
  
   
   5.     Provision for Cost of Capital.  The Company will receive annual
             compensation of 21 basis points on the statutory reserves ceded
             relating to the PPA Business, as determined at the end of each
             quarter. 
   
   6.     Investment Guidelines for Trust Assets.  The Company will have a
             continuing interest in the quality of the PPA Business Assets
         acquired and held to satisfy the PPA Business Liabilities.  The PPA
         Companies' assets will be held in trusts by an unaffiliated third
           party for the benefit of the Company pursuant to trust agreements
        (the "Trust Agreements") and will be invested in accordance with the
            following guidelines (all references to credit ratings are to
             Standard & Poor's Corporation ("S&P") ratings):
   
     (i)  Authorized New Investments (which are not subject to an
             aggregate limitation)
   
               US Treasury and Agency obligations
               Public corporate bonds (investment grade only)
               Agency mortgage-backed securities and CMOs
               Rated residential whole-loan CMOs (AAA, AA, or A)
               Rated private placements (investment grade only)
               Other rated asset-backed securities ("ABS"), including
                  commercial mortgage-backed securities (AAA or AA)
   
     (ii) Authorized New Investments (which are subject to an aggregate
             "basket" limitation of not more than 10% of the PPA Business
             Investment portfolio)
   
               Commercial mortgages
               Common stock
               Commercial mortgage-backed securities
               Any other investment authorized under insurance codes
                  (except prohibited investments)
   
     (iii)     Prohibited New Investments
   
          No investment will be made in:
   
               Equity real estate
               Affiliated entity obligations, except for the ABS set
                  out in (i) above
   
     (iv) Individual Credit Exposure Limits
   
               Direct US Government obligations - unlimited
               A rated and higher credits (including MBS/CMO) - $25
                  million
               BBB3 - BBB1 rated credits - $15 million
               All basket and noninvestment grade assets - $5 million
               Noninvestment grade assets - $5 million
   
     (v)  Portfolio Characteristics
   
               Fixed-income holdings rated below A cannot exceed 25% of
                  portfolio.
               Mortgage-backed securities, including CMOs and ABSs,
                  cannot exceed 30% of portfolio.
   
     Exceptions or changes to the investment limitations will require the
        Company's written consent.
   
   7.     Minimum Capital and Surplus Requirements.  The Trust Agreements will
          have adequate provisions to ensure that the PPA Companies will
          maintain sufficient PPA Business Assets and other assets in the
          Trusts to entitle the Company to take full financial statement
          credit for the PPA Business Reinsurance Agreements in all states and
          Parent will undertake or cause to be undertaken any and all actions
          required for the Company to so receive such reserve credits.  In
          order to maintain the Company's policyholder ratings, each of the
          PPA Companies will maintain a Risk Based Capital Ratio of at least
          150% of Company Action Level Risk Based Capital.  Accordingly,
          pursuant to paragraph 8 below, Parent will be obligated to take any
          action necessary to maintain a Risk Based Capital Ratio of at least
          150% of Company Action Level Risk Based Capital at all times under
          then applicable law. 
   
   8.     Periodic Cash Flow Testing of Reserves.  The PPA Companies will
          perform annual cash flow testing for the PPA Business using
          appropriate actuarial Standards of Practice, as promulgated by the
          American Academy of Actuaries, and in compliance with then current
          NAIC regulations.  Provision will be made for a second expert
          actuarial opinion and reconciliation in the event the Company
          disagrees with the PPA Companies' calculation.  To the extent that
          this testing indicates the reserves are inadequate, Parent, AHLIC-AZ
          or PIC would take any action necessary to maintain adequate
          reserves.  
   
   9.     Parent Guarantee.  In addition to the capital maintenance
          obligations, Parent will unconditionally guarantee the payment
          obligations of the PPA Companies under the PPA Business Reinsurance
          Agreements, and: 

     A.   In the event of (i) a decline at any time in the consolidated
          net worth of Parent below $1.5 billion, as determined in
          accordance with GAAP or (ii) a change in control of Parent or
          either of the PPA Companies, then Parent will be obligated to
          take any action necessary so that each of the PPA Companies
          increases, and maintains, its Risk Based Capital Ratio to at
          least 250% of Company Action Level Risk Based Capital;
          provided that if within 90 days of either event such Risk
          Based Capital Ratio has not otherwise been increased in
           accordance with this paragraph A, the Company will have the
          right to terminate the PPA Business Reinsurance Agreements, by
          recapturing the PPA Business Assets and the PPA Business
          Liabilities at a price agreed by Parent and the Company or at
          the fair market value as determined through arbitration by an
          actuarial or accounting firm, satisfactory to Parent and the
          Company, or an actuarial or accounting firm selected by firms
          selected by each of Parent and the Company, it being
          understood that the price will be first determined and then
          the Company will have 90 days from such determination in which
          to decide whether to exercise such option. 
   
     B.   In the event that either of the PPA Companies' Risk Based
          Capital Ratio is below 150% of Company Action Level Risk Based
          Capital for 90 days, the Company will have the right to
          terminate the PPA Business Reinsurance Agreements, by
          recapturing the PPA Business Assets and the PPA Business
          Liabilities at a price agreed by Parent and the Company or at
          the fair market value as determined through arbitration by an
          actuarial or accounting firm, satisfactory to Parent and the
          Company, or an actuarial or accounting firm selected by firms
          selected by each of Parent and the Company, it being
          understood that the price will be first determined and then
          the Company will have 90 days from such determination in which
          to decide whether to exercise such option. 
       C.   In the event that Parent has a credit rating less than BBB-,
             Parent and the Company will agree to, or determine through
             arbitration by an actuarial or accounting firm, satisfactory
             to Parent and the Company, or an actuarial or accounting firm
             selected by firms selected by each of Parent and the Company,
             the fair market value of the PPA Business Assets and the PPA
             Business Liabilities.  To the extent that for either PPA
             Company the value of the PPA Business Liabilities exceeds the
             value of the PPA Business Assets allocable to such entity,
             Parent will transfer assets to the related Trust satisfactory
             to the Company with a fair market value equal to such
             difference or arrange for a letter of credit for 150% of such
             difference to be issued by a financial institution with a S&P
             credit rating of at least A, for the benefit of such Trust;
             provided that if within 90 days of such event Parent has not
             provided such assets or  letter of credit to the extent
             required, the Company will have the right to terminate the PPA
             Reinsurance Agreements, by recapturing the PPA Business Assets
             and the PPA Business Liabilities at a price agreed by Parent
             and the Company or at the fair market value as determined
             through arbitration by an actuarial or accounting firm,
             satisfactory to Parent and the Company, or an actuarial or
             accounting firm selected by firms selected by each of Parent
             and the Company, it being understood that the price will be
             first determined and then the Company will have 90 days from
             such determination in which to decide whether to exercise such
             option.  At the end of each 12 month period commencing on the
             date of the determination pursuant to the first sentence of
             this paragraph C, and on each anniversary date thereof
             thereafter in which Parent's S&P credit rating is less than
             BBB-, Parent and the Company will value the PPA Business
             Assets and the PPA Business Liabilities and if determined to
             be necessary, Parent will transfer assets satisfactory to the
             Company with a fair market value equal to such difference or
             arrange for a letter of credit in the same manner as described
             above with the Company having a new option to terminate the
             PPA Business Reinsurance Agreements as described above if
             Parent does not provide such assets or letter of credit as
             provided above; provided that for the purpose of the foregoing
             calculation, the PPA Business Assets will not include the
             amount of any letter of credit then in effect; and provided,
             further that any letter of credit then in effect will remain
             in the Trust and in effect until the completion of the
             subsequent determination and the substitution of a new letter
             of credit in the Trust to the extent required.
   
 10.    Company Option to Terminate PPA Business Reinsurance Agreements. The
        Company will have the right to terminate the PPA Business
        Reinsurance Agreements on the seventh anniversary of the Closing
         Date, by recapturing the PPA Business Assets and the PPA Business
        Liabilities at a price agreed by Parent and the Company or at the
        fair market value as determined through arbitration by an actuarial
       or accounting firm, satisfactory to Parent and the Company, or an
        actuarial or accounting firm selected by firms selected by each of
       Parent and the Company; provided that Parent will be entitled to
       prevent the Company from exercising the foregoing option (to be
       exercised after agreement on, or determination of, value in the
       manner provided in paragraph 9) by increasing to 22.5 basis points
       the annual compensation the Company receives on the statutory
       reserves relating to the PPA Business.
 
   11.    Reimbursement for Benefit Payments.  All benefit payments will be
          made by direct check or draft on the PPA Companies' bank accounts. 
   
   12.    Other Items.  The Trust Agreements and the PPA Business Reinsurance
         Agreements will comply with applicable state laws and regulations to
         ensure proper reserve credits, including New York State Insurance
         Regulation 144 and Parent will cause any necessary actions to be
         taken to maintain such compliance. The transfer of the PPA Business
         to the PPA Companies will be structured in such a way as to cause
          the recapture of existing reinsurance of the PPA Business with
             Hamilton National Life Insurance Company. 
   
   13.    Documentation.  The form of PPA Reinsurance Agreements, Trust
             Agreements and any documentation to be executed by the Parties
             pursuant to this Annex C shall be approved by Purchaser, such
             approval not to be unreasonably withheld.
   
   14.    Tax Effect.  For all Tax periods ending after the Closing Date, for
          Tax purposes the net positive and net negative consideration
          received by the ceding and assuming companies will be adjusted, if
          necessary, to be tax neutral to the Parties on an ongoing basis,
          including any changes in tax laws.  Purchaser or Seller, as the case
          may be, shall consult with the other party prior to taking any
          position or paying any Taxes that could result in an adjustment
          would reduce or eliminate any such adjustment.
   
   
   
   
Exhibit C-1 (reference Exhibit A-1)
[{"type": "8-K", "sequence": "1", "secsgml_size_bytes": 380593}]
{"company-data": {"conformed-name": "JEFFERSON PILOT CORP", "cik": "0000053347", "assigned-sic": "6311", "irs-number": "560896180", "state-of-incorporation": "NC", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-05955", "film-number": "95582490"}, "business-address": {"street1": "100 N GREENE STREET", "city": "GREENSBORO", "state": "NC", "zip": "27401", "phone": "9106913375"}}
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 Earliest Event Reported:  October 6, 1995

                  Jefferson-Pilot Corporation             
    (Exact name of registrant as specified in its charter)

       North Carolina            1-5955          56-0896180   
(State or other jurisdiction   (Commission    (I.R.S. Employer
     of incorporation)         File Number)  Identification No.)

 100 North Greene Street, Greensboro, North Carolina     27401   
       (Address of principal executive offices)        (Zip Code)

                         (910) 691-3691                          

       (Registrant's telephone number, including area code)
Item 2.  Acquisition or Disposition of Assets
On October 6, 1995, the registrant acquired Alexander Hamilton Life
Insurance Company of America ("Alexander Hamilton") and certain of its
affiliates from Household Group, Inc. ("HGI"), a wholly owned subsidiary
of Household International, Inc. ("HI"), under a Stock Purchase Agreement
dated August 9, 1995.  The acquisition was completed through the merger of
Alexander Hamilton into a wholly owned Michigan-domiciled stock life
insurance subsidiary of the registrant ("Surviving Company") which
thereupon was renamed Alexander Hamilton Life Insurance Company of
America.  First Alexander Hamilton Life Insurance Company ("FAH"), a New
York stock life insurance company, was acquired from HGI on October 13,
1995.  Pursuant to the Stock Purchase Agreement, the acquisitions were
effective as of October 1, 1995.
The acquisitions included substantially all of the life and single premium
deferred annuity business of Alexander Hamilton and FAH.
Credit life and accident and health insurance ("Affiliated Business")
written by Alexander Hamilton and FAH was 100% reinsured back to
affiliates of HI through coinsurance agreements and related trust
agreements for the assets retained for the Affiliated Business, with HI
providing payment and performance guarantees.
The Periodic Payment Annuity business ("PPA Business") of Alexander
Hamilton, principally structured settlement and lottery business, also was
100% reinsured back to affiliates of HI through coinsurance agreements and
related trust agreements for the assets retained for the PPA Business,
with HI providing payment, performance and capital maintenance guarantees.
The Corporate Owned Life Insurance business ("COLI Business") also was
100% reinsured back to affiliates of HI through a coinsurance agreement
and related trust agreement for the assets retained for the COLI Business,
with HI providing payment, performance and capital maintenance guarantees. 
The trusts backing the PPA and COLI Businesses are subject to annual audit
requirements for solvency and capital adequacy.
The purchase price was $575 million, subject to post-closing adjustment in
accordance with the Stock Purchase Agreement.  Prior to the closing,
Alexander Hamilton paid a dividend equal to its net income from January 1,
1995 but subject to the requirement that Alexander Hamilton have, on the
closing date financial statements to be prepared and delivered by the
Surviving Company (September 30, 1995, which will form the basis for any
post-closing adjustment), a minimum statutory net worth as agreed to by
the parties.
The merger consideration was paid as follows:  $475 million plus accrued
interest in cash, and $50 million in newly issued floating rate preferred
stock of the Surviving Company.  In addition, an outstanding surplus note
of Alexander Hamilton (which became an obligation of the Surviving Company
pursuant to the merger) was acquired from HI for $50 million plus accrued
interest.
The acquisition was financed through internal resources and $315 million
of borrowings under a new Credit Agreement entered into on October 5, 1995
with a group of banks and NationsBank of Georgia, N.A. as Agent.  The
registrant expects to repay a portion of that bank debt from the proceeds
of corporate financing activities.
Further Reporting
The Registrant will file an amendment to this Form 8-K within 60 days to
provide the required pro forma financial information.
Item 7.   Financial Statements, Pro Forma Financial Information and
          Exhibits
     (a)  Financial statements of business acquired.
          (i)  Report of independent public accountants, audited
          combined balance sheets as of December 31, 1993 and 1994,
          audited combined statements of income, companies equity and
          cash flows for the years ended December 31, 1992 - 94, and
          notes to combined financial statements, for Alexander Hamilton
          Life Insurance Company of America and the acquired
          subsidiaries.
          (ii) Unaudited combined balance sheet at June 30, 1995 and
          December 31, 1994, unaudited combined condensed statements of
          income and cash flows for the six months ended June 30, 1995
          and 1994, and unaudited note to condensed financial
          statements, for Alexander Hamilton Life Insurance Company of
          America and the acquired subsidiaries.
     (b)  Pro forma financial information.
          To be supplied by amendment.

     (c)  Exhibits

          (i) Stock Purchase Agreement by and among Household Group,
          Inc., Household International, Inc., Alexander Hamilton Life
          Insurance Company of America and Jefferson-Pilot Corporation
          dated August 9, 1995.  (Confidential treatment requested with
          respect to certain portions thereof.)  (Exhibits (other than
          Exhibits B-1 to B-4) set forth in the Stock Purchase Agreement
          have been omitted and will be provided to the Securities and
          Exchange Commission upon request.)
(ii) Credit Agreement dated October 5, 1995 among the
          registrant and the banks named therein, and NationsBank of
          Georgia, N.A. as Agent, is not being filed because the total
          amount of borrowings available thereunder does not exceed 10%
          of total consolidated assets.  The registrant agrees to
          furnish a copy of the Credit Agreement to the Commission upon
          request.

                           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 thereunto duly authorized.

                              JEFFERSON-PILOT CORPORATION

                              By:     /s/Robert A. Reed          

                              (name)  Robert A. Reed             

                              (title) Vice President             

Dated:  October 18, 1995
October 18, 1995

VIA EDGAR
Securities and Exchange Commission
ATTENTION:  Filing Desk, Stop 1-4
450 Fifth Street N.W.
Washington, D.C.  20549
Ladies and Gentlemen:
SUBJECT:  Jefferson-Pilot Corporation
          File No. 1-5955
Enclosed herewith is a Current Report on Form 8-K for Jefferson-Pilot
Corporation dated October 18, 1995.
Please confirm receipt of this filing by notifying the CompuServe mailbox
maintained by Jefferson-Pilot.
Very truly yours,
 /s/ Robert A. Reed 
Robert A. Reed
Vice President, Secretary
  and Associate General Counsel
Jefferson-Pilot Corporation
Exhibits                                                     Pages
Report of independent public accountants, audited 
combined balance sheets as of December 31, 1993 and
1994, audited combined statements of income, companies
equity and cash flows for the years ended December 31, 
1992 - 94, and notes to combined financial statements,
for Alexander Hamilton Life Insurance Company of America 
and the acquired subsidiaries.

Unaudited combined balance sheet at June 30, 1995 and 
December 31, 1994, unaudited combined condensed statements 
of income and cash flows for the six months ended June 30, 
1995 and 1994, and unaudited note to condensed financial 
statements, for Alexander Hamilton Life Insurance Company 
of America and the acquired subsidiaries.

Stock Purchase Agreement by and among Household Group, 
Inc., Household International, Inc., Alexander Hamilton Life 
Insurance Company of America and Jefferson-Pilot Corporation 
dated August 9, 1995.  (Confidential treatment requested with 
respect to certain portions thereof.)  (Exhibits (other than 
Exhibits B-1 to B-4) set forth in the Stock Purchase Agreement 
have been omitted and will be provided to the Securities and 
Exchange Commission upon request.)
Alexander Hamilton Life Insurance Company of America,
First Alexander Hamilton Life Insurance Company, and
Alexander Hamilton Capital Management, Inc.
Combined Financial Statements
as of December 31, 1994, 1993, and 1992
Together With Auditors' Report
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Board of Directors
and Stockholders of
Alexander Hamilton Life Insurance Company of America, First Alexander
Hamilton Life Insurance Company, and Alexander Hamilton Capital
Management, Inc.:
We have audited the accompanying combined balance sheets of Alexander
Hamilton Life Insurance Company of America (a Michigan corporation), FIRST
alexander hamilton life insurance company (a New York corporation), and
alexander hamilton capital management, INC. (a Michigan corporation) as of
December 31, 1994 and 1993 and the related combined statements of income,
combined companies equity, and cash flows for each of the three years in
the period ended December 31, 1994.  These financial statements are the
responsibility of the Companies' management.  Our responsibility is to
express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are
free of material misstatement.  An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements.  An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation.  We believe that our audits
provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the combined financial position of Alexander
Hamilton Life Insurance Company of America, First Alexander Hamilton Life
Insurance Company, and Alexander Hamilton Capital Management, Inc. as of
December 31, 1994 and 1993 and the combined results of their operations
and their cash flows for each of the three years in the period ended
December 31, 1994 in conformity with generally accepted accounting
principles.

As disclosed in Note 2 to the combined financial statements named above,
the Companies changed their method of accounting for investments during
1994.  As disclosed in Note 11, the Companies changed their method of
accounting for postretirement benefits other than pensions in 1993.

Detroit, Michigan
January 30, 1995 (except with respect to
the matter discussed in Note 1, as to
which the date is September 22, 1995)
ALEXANDER HAMILTON LIFE INSURANCE COMPANY OF AMERICA,

FIRST ALEXANDER HAMILTON LIFE INSURANCE COMPANY, AND

ALEXANDER HAMILTON CAPITAL MANAGEMENT, INC.

COMBINED BALANCE SHEETS

December 31, 1994 and 1993

(Dollar Amounts in Thousands)
ASSETS                               1994        1993
CASH AND INVESTMENTS:
  Cash and cash equivalents                             $   10,380  $   13,821
  Debt securities available for sale, at fair value      3,515,628          - 
  Debt securities held to maturity, at amortized cost    2,737,720          -
  Debt Securities at amortized costs (Note 3)                  -     5,703,837
  Equity securities available for sale, at market value     53,289          - 
  Equity securities principally at market value                -        75,433
  Mortgage loans on real estate                            161,883     222,347
  Policy loans                                             544,198     360,416
  Real estate,less accumulated depreciation of $16,081
    And $14,858 in 1994 and 1993                            81,153     100,766
  Other investments                                          1,722       1,722
     Total cash and investments                          7,105,973   6,478,342

ACCRUED INVESTMENT INCOME                                  103,929      95,458

ACCOUNTS RECEIVABLE AND AGENTS' BALANCES                    57,607      25,159

DUE FROM REINSURERS                                         82,165      29,847

PROPERTY AND EQUIPMENT less accumulated depreciation of
$22,263 in 1994 and $19,051 in 1993                         20,088      19,397

DEFERRED POLICY ACQUISITION COSTS, net of amortization     618,652     470,230

DEFERRED INCOME TAX ASSETS (note 10)                        68,994          - 

OTHER ASSETS                                                 9,330       6,353

     TOTAL ASSETS                                       $8,066,738  $7,124,786
The accompanying notes are an integral part of these combined statements.
ALEXANDER HAMILTON LIFE INSURANCE COMPANY OF AMERICA,
                                
      FIRST ALEXANDER HAMILTON LIFE INSURANCE COMPANY, AND
                                
          ALEXANDER HAMILTON CAPITAL MANAGEMENT, INC.
                                
                                
                    COMBINED BALANCE SHEETS
                                
                   December 31, 1994 and 1993
                                
                 (Dollar Amounts in Thousands)
LIABILITIES AND COMBINED COMPANIES EQUITY                 1994       1993
POLICY LIABILITIES:
  Future policy benefits                               $7,087,065  $6,257,264
  Dividend accumulations and other policyholder funds
    on deposit                                              2,021       6,830
  Policy and contract claims                               36,439      41,105
  Unearned premium reserves                                 3,502       3,899
     Total policy liabilities                           7,129,027   6,309,098

INCOME TAXES PAYABLE                                       20,008      11,360

DEFERRED INCOME TAX LIABILITIES (note 10)                      -        2,980

ACCOUNTS PAYABLE AND ACCRUED EXPENSES                     157,620     144,142

PAYABLE TO AFFILIATE                                       67,768          - 

NOTE PAYABLE TO PARENT                                     50,000          - 

     Total liabilities                                  7,424,423   6,467,580

COMBINED COMPANIES EQUITY:
  Combined companies equity                               733,076     661,471
  Net unrealized gain (loss) on securities available 
    for sale, net of deferred policy acquisition costs
    And deferred income taxes of $129,586 and $45,581
    Respectively                                           (81,835)         -  
  Net unrealized gain on equity securities, less
    Deferred income taxes of $1,930                            -        3,540
  Net unrealized losses or foreign currency
    translations,net of income taxes of $339 and
    $464 in 1994 and 1993, respectively                    (8,926)     (7,805)

     Total combined companies equity                      642,315     657,206
     TOTAL LIABILITIES AND COMBINED COMPANIES EQUITY   $8,066,738  $7,124,786
The accompanying note is an integral part of these combined statements.
ALEXANDER HAMILTON LIFE INSURANCE COMPANY OF AMERICA,
                                
      FIRST ALEXANDER HAMILTON LIFE INSURANCE COMPANY, AND
                                
          ALEXANDER HAMILTON CAPITAL MANAGEMENT, INC.
                                
                                
                 COMBINED STATEMENTS OF INCOME
                                
       For the Years Ended December 31, 1994, 1993, 1992
                                
                 (Dollar Amounts in Thousands)
1994          1993        1992
$  56,820
  Accident and health premiums                24,167       32,577      31,108
  Contract revenue                           132,367      116,695     102,669
  Total premiums and other considerations    159,957      200,676     190,597
  Net investment income (note 3)              96,573      100,181      91,124
  Realized investment gains (losses)          21,072       63,169      20,590
    Total revenues                           277,602      364,026     302,311

BENEFITS AND EXPENSES:
  Life benefits                               64,745       74,092      71,078
  Accident and health benefits                10,923       21,358      18,358
  (Decrease) increase in reserves            (43,701)         266      (2,719)
  Other policyholder benefits                  4,230        8,283      10,515
     Total benefits                           36,197      103,999      97,232
  Insurance commissions                       56,547       77,423      34,248
  General and administrative                  55,782       50,904      49,403
  Insurance taxes, licenses, and fees         17,834       10,954      16,020
  Interest expense                             1,230           -         -   
     Total expenses                          131,393      139,281      99,671

INCOME BEFORE INCOME TAXES                   110,012      120,746     105,408
INCOME TAXES(note 10)                         38,407       38,388      37,056

NET INCOME                                 $ 71,605      $ 82,358    $ 68,352
The accompanying notes are an integral part of these combined statements.
ALEXANDER HAMILTON LIFE INSURANCE COMPANY OF AMERICA,
                                
      FIRST ALEXANDER HAMILTON LIFE INSURANCE COMPANY, AND
                                
          ALEXANDER HAMILTON CAPITAL MANAGEMENT, INC.
                                
                                
               COMBINED STATEMENTS OF CASH FLOWS
                                
     FOR THE YEARS ENDED DECEMBER 31, 1994, 1993, AND 1992
                                
                 (Dollar Amounts in Thousands)
1994         1993        1992
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income                                   $ 71,605  $   82,358  $   68,352
Adjustments to reconcile net 
Income to net cash provided
by operating activities:
  Policy liabilities                          819,929    863,081     814,974
  Deferred policy acquisition costs          (102,034)  (118,404)   (128,005)
  Depreciation and amortization                89,937    105,301      77,844
  Deferred income taxes (benefit)             (24,588)   (22,957)     (8,038)
  Amounts receivable and other assets         (96,214)   (13,345)    (28,066)
  Accounts payable and accrued expenses        22,126     73,030     (28,150)
  Realized investment (gains) losses          (21,072)   (63,169)    (20,590)
    Total adjustments                         688,084    823,537     679,969
    Net cash provided by operating 
    Activities                                759,689    905,895     748,321
CASH FLOWS FROM INVESTING ACTIVITIES:
purchases of investment securities         (2,657,373) (3,257,314) (2,570,773)
proceeds from sales and maturities  
Of investment securities                    1,881,751   2,318,920   1,758,836
Purchases of mortgage loans and 
real estate                                   (19,770)   (10,321)    (28,180)
Proceeds from sales of real estate             21,985     15,906       7,362
Proceeds from payments on mortgage 
  principle                                    80,234    138,997     177,125
Policy loans, net                            (183,782)  (116,249)    (95,943)
Additions to property, plant 
and equipment                                 ( 3,943)    (3,546)     (1,522)
 Net cash used in investing activities       (880,898)  (913,607)   (753,095)
CASH FLOWS FROM FINANCING ACTIVITIES:
Capital contribution recieved from
 parent                                            -      17,000           -   
            
Increase (decrease) in note payable       
And payable to affiliate                      117,768         -           - 
Net cash provided by (used for) 
financing activities                          117,768     17,000          -  
 Net increase (decrease) in cash
 and cash equivalents                          (3,441)     9,288      (4,774)
CASH AND CASH EQUIVALENTS, beginning 
of year                                        13,821      4,533       9,307

CASH AND CASH EQUIVALENTS, end of year      $  10,380 $   13,821  $    4,533

Supplemental Cash Flow Information:
Cash paid for income taxes                  $ 56,130   $ 51,055   $   55,246
The accompanying note is an integral part of these combined statements.
ALEXANDER HAMILTON LIFE INSURANCE COMPANY OF AMERICA,
                                
      FIRST ALEXANDER HAMILTON LIFE INSURANCE COMPANY, AND
                                
          ALEXANDER HAMILTON CAPITAL MANAGEMENT, INC.
                                
                                
        COMBINED STATEMENTS OF COMBINED COMPANIES EQUITY
                                
     FOR THE YEARS ENDED DECEMBER 31, 1994, 1993, AND 1992
                                
                 (Dollar Amounts in Thousands)
Unrealized
                                             Gains
                                          (Losses) for Net Unrealized  Gains (Losses)   Total
                                Combined    Foreign    Gains (Losses)  on Securities   Combined
                                Companies  Currency      on Equity      Available      Companies
                                 Equity   Translation    Securities       for Sale      Equity
Balance, December 31,1991      $ 493,761     $ 3,754     $ (1,484)       $    -        $496,031 

net Income                        68,352           -            -             -          68,352
Increase (decrease) during Year       -       (8,272)       1,020             -          (7,252)
Balance December 31, 1992        562,113      (4,518)        (464)            -         557,131 

Net Income                        82,358          -            -              -          82,358 
Capital Contribution from parent  17,000          -            -              -          17,000
Increase (decrease) during Year       -       (3,287)       4,004             -             717 
Balance December 31,1993         661,471      (7,805)       3,540             -         657,206 

Change in accounting principle                           
effective January 1,1994(note 2)      -           -        (3,540)        37,111         33,571  
Net Income                        71,605          -            -              -          71,605
Increase (decrease) during Year       -         (1,121)        -        (118,946)      (120,067)
Balance December 31, 1994      $ 733,076       $(8,926)     $  -        $(81,835)      $642,315
Alexander Hamilton Life Insurance Company of America,
            First alexander hamilton life insurance company, and
                 Alexander Hamilton CAPITAL Management, Inc.
                                      
                                      
                   notes to combined Financial Statements
                                      
                      December 31, 1994, 1993, and 1992
                                      
                        (Dollar Amounts in Thousands)

(1)Basis of Presentation
The accompanying combined historical financial statements include Alexander
Hamilton Life Insurance Company of America("AHLIC"), First Alexander 
Hamilton Life Insurance	Company("FAHL"), and Alexander Hamilton Capital
Management, Inc. ("AHCM") and have been	prepared in accordance with 
generally accepted accounting principles (GAAP).  All material intercompany
accounts and transactions have been eliminated.  These financial statements
have been combined and prepared as a result of the Stock Purchase Agreement
between Group, Inc., Household International, Inc., Alexander Hamilton Life
Insurance Company of America and Jefferson-Pilot Corporation dated August 
9, 1995 and excludes certain AHLIC subsidiaries that have not been acquired.

(2)SIGNIFICANT accounting policies 
   Nature of Operations
AHLIC is a wholly-owned subsidiary of Household Group, Inc., which is 
wholly-owned by	Household Finance Corporation ("Household Finance").  
Household Finance is a subsidiary of Household International, Inc. 
("Household International").  FAHL and AHCM are wholly-owned by 
AHLIC (collectively known as the "Companies") engaged in the life 
insurance business and have a diversified base of policyholders in
the United States and Canada.
AHLIC and FAHL, the insurance subsidiaries, also submit financial 
statements to insurance	industry regulatory authorities.  Those financial
statements are prepared on the basis of statutory accounting practices and 
are significantly different from financial statements prepared in accordance
with generally accepted accounting principles.
A comparison of statutory basis net income and capital and surplus of the 
life insurance subsidiaries to the amounts included in the financial 
statements is presented in Note 8. 

Cash and Cash Equivalents 
   Cash and cash equivalents consist of cash on hand and investments in 
short-term, highly liquid securities which have original maturities of 
three months or less from the date of purchase.

Investments in Debt and Equity Securities
The Companies' investment in debt securities includes notes, bonds, 
collateralized mortgage obligations, and other debt instruments.  
Investments in equity securities include common and preferred stocks.
The Companies' adopted Statement of Financial Accounting Standards No. 
115 ("SFAS No. 115"), "Accounting for Certain Investments in Debt and 
Equity Securities," effective January 1, 1994.  The adoption of SFAS 
No. 115 resulted in an increase in combined companies equity of $33,571.
In accordance with SFAS No. 115, investment securities are classified 
in three separate categories:  trading, available-for-sale, or held-
to-maturity.  Trading investments are bought and held principally for 
the purpose of selling them in the near term and are carried at fair value.
Adjustments to the carrying value of trading investments are included in 
current earnings.  Investments which the companies have the positive 
intent and ability to hold to maturity are classified as held-to-maturity 
and carried at amortized cost.  Investments not classified as trading or
held-to-maturity are classified as available-for-sale.  These investments
are carried at fair value.  Unrealized holding gains and losses on 
available-for-sale investments are recorded as adjustments to equity,
net of income taxes and the related impact on deferred policy 
acquisition costs.  Any decline in the fair value of available-for-sale 
or held-to-maturity investments which is
deemed to be other than temporary is charged against current earnings. 
Cost of	investment securities sold generally is determined using the 
first-in, first-out ("FIFO") method.
At December 31, 1993, marketable equity securities were stated at the 
lower of aggregate cost or market, while debt securities were carried 
at amortized cost. 

Mortgage and Policy Loans
Mortgage loans on real estate are stated at unpaid balances, net of 
allowances for unrecoverable amounts.  Policy loans are stated at 
their unpaid balances. 

Real Estate
Real estate not acquired by foreclosure is stated at cost, less accumulated
depreciation.  Real estate acquired by foreclosure is stated at the lower of
depreciated cost or fair value minus estimated costs to sell.  Real estate 
is depreciated principally by the straight-line method over estimated useful
lives (generally 15 years for real estate acquired by foreclosure and 
ranging from 40 to 45 years for all other). 

Property and Equipment
Property and equipment are stated at cost and are depreciated principally 
by the straight-line method over their estimated useful lives (generally 
ten years). 

Deferred Policy Acquisition Costs
The costs of acquiring new business, including commissions, certain costs 
of underwriting and issuing policies, and certain agency office expenses, 
all of which vary with and are primarily related to the production of new 
business, have been deferred. For traditional life insurance policies, these 
costs are being amortized over the premium paying periods of the related 
contracts using the same assumptions about anticipated premium revenue 
that are used to compute liabilities for future policy benefits.  For 
universal life and annuity products, these costs are amortized at a 
constant rate on the present value of the estimated future gross profits 
to be realized over the terms of the contracts, not to exceed 20 years.
Effective with the adoption of SFAS No. 115 as of January 1, 1994, the 
carrying amount of deferred policy acquisition costs is adjusted for amounts
that would have been recognized if net unrealized holding gains or losses on
debt securities classified as available-for-sale had actually been 
Deferred policy acquisition costs are reviewed for recoverability from 
future income and as such, capitalized costs that are deemed not recoverable
are expensed in the period in which the determination is made.

Recognition of Revenue
Premiums for ordinary life policies are recognized when due.  Premiums for 
credit insurance are recognized over the period at risk in relationship to 
anticipated claims.  Premiums received on single premium life, universal 
life, and annuity policies ("interest-sensitive policies") are considered 
insurance deposits.  Revenues on interest-sensitive policies consist reported
in the periods assessed.

Future Policy Benefits
The liability for future contract benefits on interest-sensitive policies 
is computed in accordance with the retrospective deposit method using 
interest rates which vary with rates credited to policyholders' accounts.  
Liabilities for future policy benefits on other life insurance products 
generally are computed using the net level premium method, based upon 
estimated future investment yields, mortality, and withdrawals appropriate
when the policies were issued.  Mortality and withdrawal assumptions 
principally are based upon the Companies' experiences.

Policy and Contract Claims
Policy and contract claims are accrued based on estimated unpaid 
settlement costs for reported losses and for incurred but not reported 
losses.  These accruals are determined through a combination of historical 
experience and management's judgment with regard to the ultimate 
exposure to the Companies.  These estimates are revised and the effect of
the revisions is charged or credited to income in the period that 
additional data is received.

Income Taxes
Household International and all of its subsidiaries file a consolidated 
federal income tax return.  The Companies adopted Statement of Financial 
Accounting Standards No. 109, "Accounting for Income Taxes" ("SFAS No. 109")
, effective January 1, 1993, which requires that deferred income taxes be 
recorded on the differences between the tax basis of assets and 
liabilities and the amounts reported in the financial statements.  The 
recorded amounts are adjusted to the tax rates expected to apply in the 
periods in which the deferred tax assets and liabilities are expected 
to be realized or settled.  The Company recorded a cumulative catch-up 
due to the adoption of SFAS No. 109, which was not material.

Interest Rate Contracts
The nature and composition of the Companies' assets and 
liabilities and off-balance sheet items expose the Companies to 
interest rate risk.  The Companies enter into a variety of 
interest rate contracts in the management of their interest rate 
exposure.  Interest swaps are the principal vehicle used to manage interest 
rate risk. Interest rate swaps are designed, and effective, as 
synthetic alterations of specific assets or liabilities (or specific 
groups of assets or liabilities) and off-balance sheet items.  The 
interest rate differential to be paid or received on these contracts is
accrued and included in net interest income in the statements of income.
The related accrual is classified as a component of accounts payable 
and accrued expenses on the accompanying balance sheets.
If interest rate contracts are terminated early, the realized gains 
and losses are deferred and amortized over the life of the hedged items 
as adjustments to net interest income in the combined statements of income.
These deferred gains and losses are recorded on the accompanying combined 
balance sheets as adjustments of the carrying amount of the hedged items.

Fair Value of Financial Instruments
The fair value of cash and cash equivalents, debt securities, equity 
securities, mortgage loans on real estate, and policy loans was 
approximately $7,006,000 and $6,740,000 at December 31, 1994 and 1993, 
respectively.  The carrying values of cash and cash equivalents approximate 
fair value because of the short maturity of those instruments.  Debt 
securities' and equity securities' fair values were determined principally
using nationally quoted market prices.  The fair value of certain 
municipal bonds is assumed to be equal to amortized cost where no market 
quotations exist.  The fair values of mortgage and policy loans are 
estimated based on quoted market prices for those or similar investments.
The fair value of debt was approximately $65,267 at December 31, 1994, 
all of which was due to Household International.  The fair value of debt 
is estimated based on the current rates offered for debt having the same 
or similar terms and remaining maturities. 
Foreign Currency Translation
Foreign subsidiary assets and liabilities are located in Canada.  The 
functional currency for each subsidiary is its local currency.  
Foreign subsidiary financial data are translated into U.S. dollars at the 
current exchange rate, and translation adjustments are accumulated as a 
separate component of equity.  Effects of foreign currency translation in 
the combined statements of cash flows are offset against the cumulative 
foreign currency adjustment, except for the impact on cash.  Foreign 
currency transaction gains and losses are included in income as they occur.
(3)Investments
The amortized cost, aggregate fair value, and gross unrealized gains and 
losses on debt and equity securities as of December 31, 1994 are as follows:
Gross        Gross
                              Amortized  Unrealized   Unrealized    Fair
       
                                  Cost          Gains    (Losses)   Value
Available for sale Investments
Government debt securities        $524,656      $ 161      $(14,712) $510,105 
Mortgage backed securities         898,084      4,312       (71,686)  830,710   
Corporate debt obligations       2,348,776      3,772      (177,735) 2,174,813
   
Total debt securities            3,771,516      8,245      (264,133) 3,515,628
Total equity securities             54,403      1,693       ( 2,807)    53,289 
Total debt and equity securities
 available for sale              $3,825,919     $9,938     $(266,940)$3,568,917
Gross        Gross
                                 Amortized  Unrealized   Unrealized    Fair
                                   Cost          Gains    (Losses)   Value
Held to Maturity Investments
Government debt securities        $ 20,895      $  35      $( 2,691) $  18,311 
Mortgage backed securities       1,182,083     13,895       (42,637) 1,153,341  
Corporate debt obligations       1,534,742     40,134      ( 26,712) 1,548,164
   
Total debt securities held      $2,737,720    $54,064      $(71,968)$2,719,816
to maturity
The amortized cost,aggregate fair value, and gross unrealized gains and 
losses pertaining to debt securities as of December 31, 1993 are as follows:
Gross        Gross
                                 Amortized  Unrealized   Unrealized    Fair
                                   Cost          Gains    (Losses)   Value
Government debt securities        $368,546      7,836      $( 1,782) $ 374,600 
Mortgage backed securities       1,927,536     92,679       ( 6,019) 2,014,196  
Corporate debt obligations       3,407,755    285,217      ( 12,808) 3,680,164
   
Total debt securities held      $5,703,837   $385,732      $(20,609)$6,068,960
The amortized cost and estimated fair value of debt securities at 
December 31, 1994 by contractual maturity are shown in the accompanying 
table.  Actual maturities will differ from contractual maturities because 
borrowers may have the right to call or prepay obligations with or 
without call or prepayment penalties.
Available for Sale            Held to Maturity 
                                    Carrying     Estimated      Carrying      Estimated
                                        Value        Fair Value        Value         Fair Value
Due in one year or less                $  359,863      $ 359,861     $   41,960     $   42,228
Due after 1 year through 5 years          487,990         454,158        155,775        158,558
Due after 5 years through 10 years        1,567,495     1,457,259        519,923        523,353
Due after 10 years through 20 year          225,106        209,070        293,034        292,735
Due after 20 years                          232,978        205,040         544,945        549,601    
Mortgage backed securities                  898,084        830,710       1,182,083      1,153,341
Total                                    $3,771,516   $  3,515,628   $2,737,720    $2,719,816
Investment income was earned from the following sources:
1994              1993            1992
Interst on debt securities                          $451,229     $  442,082     $390,150
Dividends on equity securities                        5,309            5,439           3,024
Interest on mortgage loans on     
real estate                                          17,182             28,340         54,587
Interest on policy loans                             45,689           31,048          21,605
Real estate                                           5,513             7,393           7,049         
Dividends from affiliates                             2,033          13,200          1,800 
Gross investment income                              526,955       527,502      478,215
Investment expense                                   ( 7,833)         (5,330)         (5,706) 
Interst credited                                    (422,549)    (421,991)     (381,385) 
Net investment income                              $  96,573      $100,181      $ 91,124
Summary of realized investment gains and (losses) follows:

                                                    1994             1993           1992
Debt Securities:
Gains                                            $37,240            $81,528            $48,515
Losses                                           (21,328)           (18,650)           (27,007)
Total debt securities                              15,912            62,878             21,508

Equity securities:
Gains                                     $   719             $ 3,699           $ 2,267
Losses                                     (2,088)            (    794)           ( 1,195)   
Total equity securities                    (1,369)               2,905               1,072   

Real estate and mortgage loans:
gains                                       $9,045              $1,502             $1,856
losses                                      (2,516)             (4,116)             (3,846)
Total real estate and mortgage loans         6,529               (2,614)             (1,990) 

Total realized investment gains, net                   $21,072            $63,169          $20,590
(4)Liabilities for future policy benefits
Liabilities for non interest-sensitive life insurance future policy 
benefits are based upon assumed future investment yields,
mortality rates, and withdrawal rates after giving effect 
to possible risks of adverse deviation.  The assumed mortality and
withdrawal rates are based upon the Companies' experiences.
The policy liability for future contract benefits for universal 
life and deferred annuity contracts is determined using the
retrospective deposit method, in accordance with SFAS No. 97, "Accounting 
and Reporting by Insurance Enterprises for
Certain Long-Duration Contracts and for Realized Gains and Losses from 
the Sale of Investments."
The policy liability for immediate annuities is also computed in accordance
with SFAS No. 97.  For AHLIC issues prior to
1987, mortality is based on blends of the 1971 Individual Annuity Mortality 
Table and the 1969-71 U.S. Life tables, with
interest rates ranging from 6% to 14.75%.  For AHLIC 1987 and subsequent 
issues, mortality is based on blends of the
1983a and 1979-81 U.S. Life tables, with interest rates ranging from 4.5%
to 11%.  For FAHL, mortality is based on blends of the 1983a and 1979-81 
U.S. Life tables, with interest rates ranging from 4.5% to 9.5%.
Term insurance reserves are computed in accordance with SFAS No. 60,
"Accounting and Reporting by Insurance Enterprises. For AHLIC policies 
issued prior to 1993, the valuation mortality rates are based on the 196
as adjusted for company experience, and the valuation interest rates grade
from 9.5% to 8% over 10 years.  Beginning in
1993, the valuation mortality rates are based on the 1975-80 Basic Table 
as adjusted for company experience, and the
valuation interest rates grade from 6.5% in duration 1 to 5% in duration 10.
For FAHL policies issued prior to 1994, the valuation mortality rates are 
based on the 1965-70 Basic Table as adjusted for company experience, 
interest rates grade from 9.5% to 8% over ten years.  For the FAHL term 
products introduced in 1994, the valuation mortality rates are based on 
the 1975-80 Basic Table as adjusted for company experience, and the value
grade from 6.5% in duration 1 to 5% in duration 10.

(5)POLICY AND CONTRACT CLAIM liabilities

Activity in the liability for unpaid policy and contract claims and claim 
adjustment expenses is summarized as follows:
1994                                   1993
Balance at January 1                               $41,105                                $36,646
less:reinsurance recoverable                      (2,811)                                 (2,381)
Net balance January 1                               38,294                                  34,265
Incurred related to:
 Current year                                       71,443                                    96,751
 Prior years                                          (193)                                     5,511 
Total Incurred                                        71,250                                   102,262 
Paid related to:
Current year                                          54,837                                      74,378 
Prior years                                           21,456                                      23,855
Total paid                                            76,293                                      98,233

Net balance at December 31                            $33,251                                    $38,294 
Plus: reinsurance recoverables                          3,188                                        2,811
Balance at December 31                                $36,439                                     $41,105
(6) REINSURANCE
In accordance with general practice in the insurance industry, portions 
of the life insurance written by the Companies are reinsured; however, 
the Companies remain contingently liable with respect to reinsurance ceded
unable to meet its obligations.  In the opinion of management, the 
Companies' reinsurers are financially stable and
allowances for uncollectible amounts are established against reinsurance 
receivables, if appropriate.  The following table summarizes net premiums 
earned and net insurance benefits and losses incurred:
1994                        1993                             1992
Premiums written and other 
considerations                                       $231,061                 $218,386                     $209,397
less premiums ceded                                  71,501                     19,674                        22,448
net premiums written and                                
other considerations                                 159,560                   198,712                       186,909
Change in Unearned Premiums                              397                       1,964                          3,688   
Net Premiums and other Consid.                      $159,957                 $200,676                     $190,597

Gross benefits                                     $96,148                 $118,712                     $122,751 
Less reinsurance recoveries                         16,250                     14,700                         22,800        
Net benefits                                        79,898                    103,733                         99,951   
Change in reserves                                 (43,701)                          266                         (2,719)  
Net benefits                                        $36,197                  $103,999                     $   97,232
(7)COMMITMENTS AND CONTINGENCIES
The Companies are parties to litigation occurring in the normal 
course of business.  In the opinion of management, such
litigation will not have a material adverse effect on the Companies' 
financial position or results of operations.

(8)STATUTORY REPORTING
The accompanying financial statements have been prepared on the basis of 
GAAP, which varies from statutory accounting
practices ("SAP") prescribed or permitted by insurance regulatory 
authorities.  The principal differences between SAP and
GAAP are that for SAP (i) certain assets that are nonadmitted assets are 
eliminated from the balance sheet, (ii) acquisition
cost for policies are expensed as incurred, while they are deferred 
and amortized over the life of the policies under GAAP,
(iii) no provision is made for deferred income taxes, (iv) the timing of 
establishing certain reserves is different than under
GAAP; (v) certain notes are considered surplus rather than debt, (vi) 
valuation allowances are established against
investments and (vii) premiums for universal life and annuity products are 
recognized as revenue when collected for SAP
and in the period assessed for GAAP.
The amount of statutory net income and capital and surplus for the Companies
for the years ended December 31 were as
follows:
1994                       1993                             1992
Net Income                         $  66,063                      $ 40,367                   $ 23,530
Capital and Surplus                   365,146                      251,229                     226,465
As it applies to AHLIC, in accordance with the Insurance Code of the State
 of Michigan, dividend payments have certain
limitations without the prior approval of the Director of Insurance.  
In 1995, dividend payments in excess of $58,100 would require prior approval.
AHLIC is required to maintain minimum capital
and surplus of $1,000.  FAHL is required to maintain minimum capital of
$2,000 and additional paid-in surplus of at 
least $4,000 or 200% of its capital, whichever
is greater.  The state of New York has no dividend limitation requirements.

(9)Related-Party and Other Transactions
In the normal course of business and, in management's opinion, at terms 
comparable to those available from unrelated
parties, the Companies have engaged in transactions with its parent and 
affiliates.  A brief description of each of these is
discussed below.
The Companies write credit insurance policies covering loans originated 
by Household Finance's consumer finance subsidiaries and Household 
International's banking subsidiaries.  The principal transactions and 
balance accompanying financial statements are summarized as follows:
1994                     1993                         1992
Premiums                                                $47,100                $58,300                     $57,934
Policy Benefits                                          29,100                 36,400                       37,500  
Due and uncollected                                       6,500                     6,600                          6,300
Policy and contract claims                               34,000                   38,400                       35,900

The Companies paid $3,800, $3,900, and $3,100 in 1994, 1993, and 1992, 
respectively, to Household Finance for administrative expenses.
AHLIC leases two office buildings to its parent and an affiliate, who use 
the buildings as their headquarters and administration facilities.  The 
investment in these buildings was $28,000 and $29,200 at December 31,
1994 and 1993 respectively.  The building leases have combined minimum 
annual rentals of $4,500.  The leases expire in 2013.
Effective October 1, 1994, the Companies entered into a reinsurance ceded 
treaty with Hamilton National Life Insurance Company ("HNLIC"), a 
wholly-owned subsidiary of AHLIC (not included in these financial statements)
block of annuity contracts.  The funds backing the reserves, amounting to 
$64,000, are payable as of December 31, 1994, and are expected to be 
transferred with accrued interest in 1995.  The payable and accrued interest
accompanying balance sheet as payable to affiliate.
During 1994, Alexander Hamilton Insurance Agency ("AHIA"), a subsidiary 
of AHLIC, declared and paid a $2,000 dividend and paid a $500 dividend 
declared in 1993.  In 1993, AHIA declared a $1,200 dividend, with $500 of
dividend payable at December 31, 1993.  During 1992, AHIA declared a 
$1,800 dividend payable to the Companies, of which $400 was payable at 
December 31, 1992.  In 1993, HNLIC declared and paid dividends of $12,00
are reflected in investment income in the accompanying combined 
statements of income. On September 29, 1994, AHLIC entered into a $50,000
9.76% capital note agreement with Household International.  The note 
matures September 30, 2024.  Interest is payable on March 31 and September
1995.  The Companies have recorded $1,230 of interest expense related to 
this note in the accompanying combined statements of income.  The payment 
of principal and/or interest otherwise required or permissible shall 
AHLIC has obtained the prior written approval of the Michigan 
Insurance Bureau and obtained the prior approval of the board of directors,
(ii) such payment will not cause AHLIC to violate its statutory capital
Michigan Insurance Code; and (iii) AHLIC has adequate earned surplus 
funds available for such payment. At December 31, 1994 and 1993, the 
Companies owned $125,000 in securitized Household Finance Corporation
consumer receivables.
During 1993, AHLIC received a $17,000 capital contribution from Household 
International. 

(10)income taxes
A reconciliation of the federal income tax rate to the Companies' effective 
rate for each year is as follows:
1994            1993          1992
Federal income tax at the stautory
rate                                                                     35.0%          35.0%           34.0%
Tax -e xempt interst and dividends
reduction received                                                       (.6)           (3.7)           (.7)
State Taxes                                                               .8             1.3             1.0    
Other (decrease) increase,net                                            (.3)            (.8)             .9 
Provision for income taxes                                              34.9%           31.8%             35.2%
The tax effects of temporary differences that result in significant 
deferred tax assets and liabilities are as follows:

                                                                        1994                                1993
Deferred tax assets:
Insurance reserves                                                  $     174,265                           $145,584
Invested assets basis                                                       9,328                             14,594 
Net unrealized investment losses                                            45,581                                -
Total Deferred tax assets                                                  229,174                            160,178
Deferred tax liabilities										   
deferred policy acquisition costs                                          126,563                        
Leverage leases                                                             30,846                            27,822
Net unrealized investment gains                                                 -                              1,930
Other                                                                         2,771                            1,816
Total Deferred tax liabilities                                              160,180                          163,158

Net deferred tax assets (liabilities)                                       $68,994                        $ (2,980)
The components of the provision are:
                                                                 1994                  1993                1992
Current:
 Federal                                                        $ 62,075          $ 59,761              $ 44,013
 State                                                              920              1,584                 1,081   

Deferred:
Federal                                                          (24,588)         (22,957)               ( 8,038)
Total                                                          $  38,407          $38,388                $37,056
(11)EMPLOYEE BENEFIT PLANS
The Companies participate in defined benefit pension plans of Household 
International covering substantially all of their
employees.  Plan benefits are based primarily on years of service.  
Plan assets primarily consist of equity securities
including those of foreign issuers and corporate and government obligations.
Pension income for defined benefit plans, primarily due to the overfunded 
status of the domestic plan, included the following components:
Year ended December 31                                           1994            1993      1992
Service costs-benefits earned during
 the period                                                   $ (1,072)       $(1,430)     $(1,253)
Interest cost on projected benefit
 obligation                                                     (1,266)          (1,450)    (1,377) 
Expected return on assets                                        2,142             2,765     2,616 
Net amortization deferral                                          653                653      653
Pension Income                                                $    457           $   538      $ 639
The funded status of the defined benefit pension plan attributable to 
the Companies was as follows:
At December 31                               1994                 1993
Actuarial present value of:      
Vested benefits obligation                  $ 8,911                  $13,419
Nonvested benefits obligation                3,461                   4,175
Accumulated benefit obligation              12,372                  17,594    
Effexts on anticipated future
 compensation levels                        2,572                      2,653
Projected benefit obligation               14,944                     20,247

Plan assets at fair value                  22,094                     30,785
Plan assets in excess of projected
 benefit obligation                      $ 7,150                  $ 10,538
The 1994 and 1993 projected benefit obligations for the defined benefit 
plans were determined using an assumed weighted
average discount rate of 8.25% and 7.25%, respectively, an assumed 
compensation increase of 4.75% and 3.75%,
respectively, and an assumed weighted average long-term rate of return on 
plan assets of 10.0% and 9.5%, respectively.

At December 31, the excess of plan assets over the projected benefit 
obligation included the following components:
1994                        1993
Unamortized prior service costs                            $( 173)                     $(   204)
Net unrecognized loss from past experience
diffferent from assumed and effects of
changes in assumptions                                      (3,361)                     (    169)
Unamortized assets                                           2,675                        3,359
Prepaid pension costs                                        8,009                        7,552
Plan assets in excess of projected benefit
 obligation                                                $ 7,150                      $ 10,538
The straight-line method of amortization is used for prior service cost 
and unrecognized gains and losses.
The Companies also participate in a defined contribution plan of Household 
International where each participant's
contribution is matched by the Companies up to a maximum of 6% of the 
participant's compensation.  For 1994, 1993,
and 1992, these costs totaled approximately $1,000 annually.
The Companies have several plans which provide medical, dental, and 
life insurance benefits to retirees and eligible
dependents.  The plans are funded on a pay-as-you-go basis and cover 
substantially all employees who meet certain age
and vested service requirements.  The Companies have instituted dollar 
limits on its payments under the plans to control
the cost of future medical benefits.
Effective January 1, 1993, the Companies adopted SFAS No. 106 "Employers' 
Accounting for Postretirement Benefits
Other Than Pensions,"  which requires the accrual of the cost of providing 
postretirement benefits for medical, dental, and
life insurance coverage over the active service period of the employee.  
The Companies adopted SFAS No. 106 on a prospective basis, which amortizes 
the obligation existing at the adoption date over 20 years.  The unrealized
obligation was $2.3 million and $2.4 million at December 31, 1994 and 1993.

At December 31, the net postretirement benefit cost included the following:
1994                         1993
Service costs benefits earned during the period        $340                         $432
Interest cost on accumulated post retirement 
 benefit obligation                                     302                            249
Net amortization and deferral                           146                            127
Net periodic post retirement benefit cost              $788                           $808
Through 1992, it had been the Companies' policy to charge the cost of 
retiree health care and life insurance benefits to expense when benefits 
were paid.  The cost of plans which cover retirees and eligible depend
States is not significant to the Companies.
The actuarial and recorded liabilities for postretirement benefit plans, 
none of which have been funded, were:
1994                      1993
Actuarial present value of post retirement
benefit obligation for:
 Retirees                                                   $ 1,632                  $ 2,215
 Fully eligible active participants                           1,128                    1,524     
 Other active participants                                    2,647                    2,588
Accumulated postretirement benefit obligation                 5,407                    6,327
Net unrealized gain (loss) from past experience
 different from assumed and effects of changes
 in assumptions                                                 736                   (1,086) 
Unamortized liability                                        (4,199)                 (4,432)  
Accrued Post retirement benefit obligation                  $ 1,944                  $   809
The December 31, 1994 and 1993 accumulated postretirement benefit 
obligation was determined using an assumed weighted average discount rate 
of 8.5% and 7.5%, respectively, and an assumed annual compensation in
and 3.75% respectively.  A 14.2% and 15.0% annual rate of increase in 
the gross cost of covered health care benefits was
assumed for 1994 and 1993, respectively.  This rate of increase is assumed 
to decline by one percentage point in each year
after 1995.
The health care cost trend rate assumption has an effect on the amounts 
reported.  To illustrate, increasing the assumed
health care cost trend rate by 1% would have increased both the 1994 and 
1993 net periodic postretirement benefit obligation at December 31, 1994 
and 1993 by $297 and $297, respectively. 

Incentive Compensation and Stock Option Plans
Certain members of management of the Companies participate in Household 
International's executive compensation plans which provide for the issuance 
of nonqualified stock options and incentive stock options.  These 
holder to purchase, under certain limitations, Household International's 
common stock at a price not less than 100 percent of the market value of 
the stock on the date the option is granted. 

Deferred Agent Compensation
The Companies sponsor a contributory deferred compensation plan for 
certain qualified agents.  The accumulated value of both the Companies' 
and the agents' contributions was $33,000 and $32,100 at December 31, 1994
and 1993 respectively, and is included with accounts payable and accrued 
expenses.  In 1991, the Companies established a Rabbi Trust supporting 
the liability which is recorded at the market value of the underlying as
other assets.
(12) Derivatives
The Companies have limited involvement with derivative financial instruments
 and do not use these instruments for trading purposes.  They are generally 
used to manage well-defined interest rate risk and to hedge investment
Interest rate cap agreements with notional value of $500,000 were initiated
the cap transactions, which had an original maturity in 1996, was to hedge 
annuity liabilities.  A gain of $1,400 was recognized upon termination.
Interest rate swap transactions with a notional value of $495,000 were 
entered into during 1993 and 1994.  Swaps with a notional value of 
$300,000 were terminated during 1994 at a loss of $400.  Swaps with a 
notional remain open as of December 31, 1994.  Termination of these swaps 
at current market interest rates would result in a settlement payment of 
$12,900 as of December 31, 1994. Interest is exchanged monthly on notional 
value of $125,000, with the Companies receiving a weighted average return
5.28% and paying 1 month LIBOR (6.00% at December 31, 1994) on a net 
exchange basis.  On the remaining $70,000 of notional value, the Companies 
receive a fixed rate of 6.68% and pay 3 month LIBOR (6.50% at December 31)
net exchange basis.  The net amount received or paid under these swaps is 
reflected as an adjustment to interest income.
Futures contracts were entered into and terminated during 1994 to hedge 
existing and anticipated investment transactions. Deferred realized losses 
from these terminations were $9,600 in 1994, which will be amortized 
Although off-balance sheet derivative financial instruments do not expose 
notional amount, such agreements generate credit risk to the extent of the 
fair value gain in an off-balance sheet derivative financial instrument if 
the counterparty fails to perform.  Such risk is minimized based on  
and the consistent monitoring of these agreements.  The counterparties to 
and investment banks, all of which were approved by AHLIC's asset and 
liability committee.
EXHIBIT 7 (a) (ii)

   ALEXANDER HAMILTON LIFE INSURANCE COMPANY OF AMERICA,
   FIRST ALEXANDER HAMILTON LIFE INSURANCE COMPANY, AND
   ALEXANDER HAMILTON CAPITAL MANAGEMENT, INC.
   COMBINED BALANCE SHEETS
   (Dollar Amounts in Thousands)
June 30,    Dec. 31,
                          ASSETS                               1995        1994  
                                                           (Unaudited)
CASH AND INVESTMENTS:
     Cash and cash equivalents                             $    4,546  $   10,380
     Debt securities available for sale, at fair value      3,888,761   3,515,628
     Debt securities held to maturity, at amortized cost    2,744,567   2,737,720
     Equity securities available for sale, at market value     66,165      53,289
     Mortgage loans on real estate                            216,630     161,883
     Policy loans                                             776,673     544,198
     Real estate                                               79,807      81,153
     Other investments                                          1,722       1,722
        Total cash and investments                          7,778,871   7,105,973
   
   ACCRUED INVESTMENT INCOME                                  104,791     103,929
   
   ACCOUNTS RECEIVABLE AND AGENTS' BALANCES                    45,635      57,607
   
   DUE FROM REINSURERS                                         84,791      82,165
   
   PROPERTY AND EQUIPMENT                                      18,156      20,088
   
   DEFERRED POLICY ACQUISITION COSTS, net of amortization     480,543     618,652
   
   DEFERRED INCOME TAX ASSETS                                  23,700      68,994
   
   OTHER ASSETS                                                11,646       9,330
   
        TOTAL ASSETS                                       $8,548,133  $8,066,738
The accompanying note is an integral part of these combined statements.

   
        ALEXANDER HAMILTON LIFE INSURANCE COMPANY OF AMERICA,
                                  
        FIRST ALEXANDER HAMILTON LIFE INSURANCE COMPANY, AND
                                  
             ALEXANDER HAMILTON CAPITAL MANAGEMENT, INC.
                                  
                                  
                       COMBINED BALANCE SHEETS
                                  
                    (Dollar Amounts in Thousands)
June 30,     Dec.31,
                                   LIABILITIES AND COMBINED COMPANIES EQUITY                 1995        1994   
                                                          (Unaudited)
POLICY LIABILITIES:
     Future policy benefits                               $7,545,625  $7,087,065
     Dividend accumulations and other policyholder funds
       on deposit                                              2,388       2,021
     Policy and contract claims                               43,370      36,439
     Unearned premium reserves                                 3,734       3,502
        Total policy liabilities                           7,595,117   7,129,027
   
   INCOME TAXES PAYABLE                                       10,817      20,008
   
   ACCOUNTS PAYABLE AND ACCRUED EXPENSES                     132,590     157,620
   
   PAYABLE TO AFFILIATE                                        4,371      67,768
   
   NOTE PAYABLE TO PARENT                                     50,000      50,000
   
        Total liabilities                                  7,792,895   7,424,423
   
   
   COMBINED COMPANIES EQUITY:
     Combined companies equity                               761,738     733,076
     Net unrealized gain (loss) on securities available 
       for sale                                                1,848     (81,835)
     Net unrealized losses or foreign exchange
       transactions                                           (8,348)     (8,926)
   
        Total combined companies equity                      755,238     642,315
        TOTAL LIABILITIES AND COMBINED COMPANIES EQUITY   $8,548,133  $8,066,738
The accompanying note is an integral part of these combined statements.
   
   
   
   
                                           
   
   
        ALEXANDER HAMILTON LIFE INSURANCE COMPANY OF AMERICA,
                                  
        FIRST ALEXANDER HAMILTON LIFE INSURANCE COMPANY, AND
                                  
             ALEXANDER HAMILTON CAPITAL MANAGEMENT, INC.
                                  
                                  
                    COMBINED STATEMENTS OF INCOME
                                  
                    (Dollar Amounts in Thousands)
Six Months Ended
                                                           June 30, 
                                                                                              1995        1994   
                                                          (Unaudited) (Unaudited)
REVENUE:
     Life premiums                                         $  23,187   $  26,784
     Accident and health premiums                             13,185      12,500
     Contract revenue                                         68,317      67,108
        Total premiums and other considerations              104,689     106,392
     Net investment income                                    64,971      36,792
     Realized investment gains (losses)                       (3,138)     26,912
                                                             166,522     170,096
   
   BENEFITS AND EXPENSES:
     Life benefits                                            42,511      37,861
     Accident and health benefits                              6,658       6,246
     (Decrease) increase in reserves                           1,978        (561)
     Other policyholder benefits                                 357       3,738
        Total benefits                                        51,504      47,284
     Insurance commissions                                    31,740      34,753
     General and administrative                               26,703      29,217
     Insurance taxes, licenses, and fees                       9,811       8,016
     Interest expense                                          2,453        -   
        Total expenses                                        70,707      71,986
   
   INCOME FROM OPERATIONS BEFORE INCOME TAXES                 44,311      50,826
   INCOME TAXES                                               15,649      17,587
   
   NET INCOME                                              $  28,662   $  33,239
The accompanying note is an integral part of these combined statements.
   
   
   
   
   
   
        ALEXANDER HAMILTON LIFE INSURANCE COMPANY OF AMERICA,
                                  
        FIRST ALEXANDER HAMILTON LIFE INSURANCE COMPANY, AND
                                  
             ALEXANDER HAMILTON CAPITAL MANAGEMENT, INC.
                                  
                                  
                  COMBINED STATEMENTS OF CASH FLOWS
                                  
                    (Dollar Amounts in Thousands)
Six Months Ended
                                                           June 30, 
                                                                                              1995        1994
CASH FLOWS FROM OPERATING ACTIVITIES:
     Net Income                                           $   28,662  $   33,239
     Adjustments to reconcile net income to net cash
       provided by operating activities:
         Policy liabilities                                  466,090     449,010
         Deferred policy acquisition costs                   (55,217)    (71,780)
         Depreciation and amortization                        43,306      56,068
         Deferred income taxes (benefit)                      (1,282)     (2,980)
         Amounts receivable and other assets                   6,168     (21,605)
         Accounts payable and accrued expenses               (34,221)     12,825
         Realized investment (gains) losses                    3,138     (26,912)
           Total adjustments                                 427,982     394,626
           Net cash provided by operating activities         456,644     427,865
   CASH FLOWS FROM INVESTING ACTIVITIES:
     Purchases of investment securities                   (1,811,101) (1,898,895)
     Proceeds from sales and maturities of investment 
       securities                                          1,698,444   1,494,747
     Purchases of mortgage loans and real estate             (72,996)     (1,049)
     Proceeds from sales of real estate                        1,186      13,817
     Proceeds from payments on mortgage principle             18,249      52,821
     Policy loans, net                                      (232,475)    (89,921)
     Additions to property, plant and equipment                 (388)       (527)
        Net cash used in investing activities               (399,081)   (429,007)
   CASH FLOWS FROM FINANCING ACTIVITIES:
     Increase (decrease) in note payable and payable 
       to affiliate                                          (63,397)        711
     Net cash provided by (used for) financing activities    (63,397)        711
        Net decrease in cash and cash equivalents             (5,834)       (431)
   CASH AND CASH EQUIVALENTS, beginning of year               10,380      13,821
   
   CASH AND CASH EQUIVALENTS, end of year                 $    4,546  $   13,390
The accompanying note is an integral part of these combined statements.
   
   
   Alexander Hamilton Life Insurance Company
   First Alexander Hamilton Life Insurance Company, and
   Alexander Hamilton Capital Management, Inc.
   Note to Combined Condensed Financial Statements
   Unaudited
   Basis of Presentation
The accompanying combined condensed financial statements include Alexander
Hamilton Life Insurance Company of America ("AHLIC"), First Alexander Hamilton
Life Insurance Company ("FAHL"), and Alexander Hamilton Capital Management,
Inc.("AHCM") and are unaudited, but, in the opinion of management, reflect all
adjustments necessary to present fairly the combined condensed June 30, 1995
balance sheet and statements of income and cash flows for the six months ended
June 30, 1995 and 1994.  Such adjustments consist only of normal recurring
accruals and adjustments.  These financial statements have been combined and
prepared as a result of the Stock Purchase Agreement between the Household
Group, Household International, Inc., Alexander Hamilton Life Insurance Company
of America and Jefferson - Pilot Corporation dated August 9, 1995 and exclude
certain AHLIC subsidiaries that have not been acquired.
These combined condensed financial statements should be read in conjunction with
the audited combined financial statements and related notes.  Combined net
income and cash flows for the interim periods reflected in the accompanying
combined condensed financial statements are not neceassarily indicative of those
to be expected for the entire fiscal year.
   
   
   
   
   
   
   
   
   
                           TABLE OF CONTENTS
   
                                                            Page No.
   
                         ARTICLE I.DEFINITIONS
   
   SECTION 1.1.    Defined Terms . . . .  . . . . . . . . . . . . .2
   SECTION 1.2.    Other Terms . . . . .  . . . . . . . . . . . . 11
   
   
                ARTICLE II.PURCHASE AND SALE OF SHARES
   
   SECTION 2.1.    Transfer of Shares. .  . . . . . . . . . . . . 12
   SECTION 2.2.    Purchase Price. . . . . . . . . . . . . .. . . 12
   SECTION 2.3.    Post-Closing Adjustment . . . . . . . . .. . . 12
   SECTION 2.4.    Dispute Resolution. . . . . . . . . . . .. . . 14
   
   
                         ARTICLE III.CLOSING 
   
   SECTION 3.1.    Time and Place of Closing . . . . . . . . .  . 15
   SECTION 3.2.    Deliveries by Sellers . . . . . . . . . . .  . 15
   SECTION 3.3.    Deliveries by Purchaser . . . . . . . . . .  . 16
   
   
                    ARTICLE IV.GUARANTEE BY PARENT
   
   SECTION 4.1.    Guarantee of Seller's Performance . . . . .  . 16
   SECTION 4.2.    Waiver. . . . . . . . . . . . . . . . . . .  . 16
   
   
     ARTICLE V.REPRESENTATIONS AND WARRANTIES OF SELLER AND PARENT
   
   SECTION 5.1.    Incorporation and Qualification; Subsidiaries  16
   SECTION 5.2.    Articles of Incorporation--By-Laws. . . . . .  18
   SECTION 5.3.    Acquired Subsidiaries . . . . . . . . . . . .  18
   SECTION 5.4.    Scope of Business . . . . . . . . . . . . . .  19
   SECTION 5.5.    Authorization . . . . . . . . . . . . . . . .  19
   SECTION 5.6.    Capitalization. . . . . . . . . . . . . . . .  19
   SECTION 5.7.    Ownership of Shares and Note. . . . . . . . .  19
   SECTION 5.8.    Statutory Statements. . . . . . . . . . . . .  20
   SECTION 5.9.    GAAP Financial Statements . . . . . . . . . .  20
   SECTION 5.10.   Investments; Defaults. . . . . . . . . . . . . 20
   SECTION 5.11.   Twindex Policies . . . . . . . . . . . . . . . 21
   SECTION 5.12.   Reserves . . . . . . . . . . . . . . . . . . . 21
   SECTION 5.13.   Bank Accounts; Custodial Accounts; Receivables 22
   SECTION 5.14.   Material Contracts (Other Than Reinsurance). . 22
   SECTION 5.15.   Reinsurance Treaties . . . . . . . . . . . . . 23
   SECTION 5.16.   Employees and Compensation . . . . . . . . . . 24
   SECTION 5.17.   Employee Benefit Plans . . . . . . . . . . . . 25
   SECTION 5.18.   Producers for the Company. . . . . . . . . . . 27
   SECTION 5.19.   Insurance. . . . . . . . . . . . . . . . . . . 28
   SECTION 5.20.   Insurance Policy Forms and Rates . . . . . . . 29
   SECTION 5.21.   Litigation and Regulatory Investigations . . . 29
   SECTION 5.22.   Compliance with Applicable Laws and Regulations30
   SECTION 5.23.   Brokers' or Finders' Fees. . . . . . . . . . . 30
   SECTION 5.24.   Full Disclosure; No Misrepresentations . . . . 30
   SECTION 5.25.   Dividends; Distributions on the Note . . . . . 30
   SECTION 5.26.   Property . . . . . . . . . . . . . . . . . . . 31
   SECTION 5.27.   Patents and Trademarks; Technology . . . . . . 32
   SECTION 5.28.   Absence of Certain Changes or Events . . . . . 33
   SECTION 5.29.   Agreement Does Not Violate Other Agreements. . 35
   SECTION 5.30.   Consents and Approvals . . . . . . . . . . . . 36
   SECTION 5.31.   Environmental Matters. . . . . . . . . . . . . 36
   SECTION 5.32.   Liabilities. . . . . . . . . . . . . . . . . . 38
   SECTION 5.33.   Disclaimer . . . . . . . . . . . . . . . . . . 38
   SECTION 5.34.   Related Party Agreements . . . . . . . . . . . 38
   SECTION 5.35.   Policy Information . . . . . . . . . . . . . . 39
   SECTION 5.36.   COLI Agreements. . . . . . . . . . . . . . . . 39
   SECTION 5.37.   Certain Business Practices . . . . . . . . . . 39
   
   
        ARTICLE VI.REPRESENTATIONS AND WARRANTIES OF PURCHASER
   
   SECTION 6.1.    Organization and Standing . . .. . . . . . . . 40
   SECTION 6.2.    Authority . . . . . . . . . . .. . . . . . . . 40
   SECTION 6.3.    Investment Representation . . .. . . . . . . . 40
   SECTION 6.4.    Consents and Approvals. . . . .. . . . . . . . 40
   SECTION 6.5.    No Conflict or Violation. . . .. . . . . . . . 41
   SECTION 6.6.    Financial Ability . . . . . . .. . . . . . . . 41
   SECTION 6.7.    Litigation. . . . . . . . . . .. . . . . . . . 41
   SECTION 6.8.    Brokers . . . . . . . . . . . .. . . . . . . . 42
   
   
    ARTICLE VII.CONDUCT AND TRANSACTIONS PRIOR TO THECLOSING DATE;
                            CERTAIN COVENANTS
   SECTION 7.1.    Maintenance of Business; Certain Transactions  42
   SECTION 7.2.    Reports . . . . . . . . . . . . . . . . . . .  44
   SECTION 7.3.    Corporate Existence . . . . . . . . . . . . .  44
   SECTION 7.4.    Twindex Policies. . . . . . . . . . . . . . .  45
   SECTION 7.5.    Further Assurances. . . . . . . . . . . . . .  45
   SECTION 7.6.    Access. . . . . . . . . . . . . . . . . . . .  45
   SECTION 7.7.    Consents. . . . . . . . . . . . . . . . . . .  46
   SECTION 7.8.    Notification of Certain Matters . . . . . . .  46
   SECTION 7.9.    Performance . . . . . . . . . . . . . . . . .  46
   SECTION 7.10.   Negotiations . . . . . . . . . . . . . . . . . 46
   SECTION 7.11.   Tax Basis. . . . . . . . . . . . . . . . . . . 47
   SECTION 7.12.   Computer Services and Software . . . . . . . . 47
   SECTION 7.13.   Business Transfer. . . . . . . . . . . . . . . 48
   SECTION 7.14.   Non-Solicitation . . . . . . . . . . . . . . . 48
   SECTION 7.15.   Sale of Office Building to Parent; Lease
                   Modification . . . . . . . . . . . . . . . . . 48
   SECTION 7.16.   Cross-Defaults . . . . . . . . . . . . . . . . 49
   SECTION 7.17.   Payments on the Note; Other Dividends. . . . . 49
   SECTION 7.18.   Name Change. . . . . . . . . . . . . . . . . . 50
   SECTION 7.19.   Delivery of Additional Financial Statements. . 50
   SECTION 7.20.   Administrative Services. . . . . . . . . . . . 50
   
   
                  ARTICLE VIII.COVENANTS OF PURCHASER
   SECTION 8.1.    Performance . . . . . . . . .. . . . . . . . . 51
   SECTION 8.2.    Further Assurances. . . . . .. . . . . . . . . 51
   SECTION 8.3.    Consents and Notices. . . . .. . . . . . . . . 51
   SECTION 8.4.    Employee Benefit Plans. . . .. . . . . . . . . 52
   SECTION 8.5.    Excess Benefit Plan . . . . .. . . . . . . . . 54
   SECTION 8.6.    Employee Welfare Benefit Plans.  . . . . . . . 55
   SECTION 8.7.    Benefits Transition . . . . . .  . . . . . . . 57
   
   
                   ARTICLE IX.CONDITIONS TO CLOSING
   
   SECTION 9.1.    Conditions to Each Party's Obligations. . . . .57
   SECTION 9.2.    Conditions to Sellers' Obligations. . . . . . .58
   SECTION 9.3.    Conditions to Purchaser's Obligations . . . . .59
   
   
                         ARTICLE X.TERMINATION
   
   SECTION 10.1.   Termination. . . . . . . . . . . . . . . . . . 62
   
   
                ARTICLE XI.SURVIVAL AND INDEMNIFICATION
   
   SECTION 11.1.   Survival . . . . . . . . . . . . . . . . . . . 64
   SECTION 11.2.   Sellers' Indemnification . . . . . . . . . . . 64
   SECTION 11.3.   Purchaser's Indemnification. . . . . . . . . . 67
   SECTION 11.4.   Indemnification Procedure. . . . . . . . . . . 67
   
   
                        ARTICLE XII.TAX MATTERS
   SECTION 12.1.   Tax Sharing Agreements . . . . . . . . . . . . 68
   SECTION 12.2.   Representations, Warranties, Agreements, and
                   Covenants of Seller with Regard to Certain Tax
                   Matters. . . . . . . . . . . . . . . . . . . . 69
   SECTION 12.3.   Representations, Warranties, Agreement, and
                   Convenants of Purchaser with Regard to Certain
                   Tax Matters. . . . . . . . . . . . . . . . . . 72
   SECTION 12.4.   Joint Agreements and Covenants of Seller and
                   Purchaser. . . . . . . . . . . . . . . . . . . 73
   SECTION 12.5.   Straddle Period Tax Allocations. . . . . . . . 78
   SECTION 12.6.   Determination Of Tax Benefit . . . . . . . . . 78
   SECTION 12.7.   Tax Dispute Resolution Mechanism . . . . . . . 79
   
   
                 ARTICLE XIII.MISCELLANEOUS PROVISIONS
   
   SECTION 13.1.   Entire Agreement; Waiver . . . . . . . . . . . 79
   SECTION 13.2.   Amendment and Modification . . . . . . . . . . 79
   SECTION 13.3.   Confidentiality. . . . . . . . . . . . . . . . 80
   SECTION 13.4.   Specific Performance . . . . . . . . . . . . . 81
   SECTION 13.5.   Expenses . . . . . . . . . . . . . . . . . . . 81
   SECTION 13.6.   Notices. . . . . . . . . . . . . . . . . . . . 81
   SECTION 13.7.   Severability . . . . . . . . . . . . . . . . . 83
   SECTION 13.8.   Assignment . . . . . . . . . . . . . . . . . . 83
   SECTION 13.9.   Third Parties. . . . . . . . . . . . . . . . . 83
   SECTION 13.10.  Captions . . . . . . . . . . . . . . . . . . . 84
   SECTION 13.11.  Governing Law. . . . . . . . . . . . . . . . . 84
   SECTION 13.12.  Choice of Forum. . . . . . . . . . . . . . . . 84
   SECTION 13.13.  WAIVER OF JURY TRIAL . . . . . . . . . . . . . 84
   SECTION 13.14.  Counterparts . . . . . . . . . . . . . . . . . 84
   SECTION 13.15.  Drafting . . . . . . . . . . . . . . . . . . . 84
   SECTION 13.16.  Books and Records. . . . . . . . . . . . . . . 85
   SECTION 13.17.  Governmental Notices . . . . . . . . . . . . . 85
   SECTION 13.18.  Exhibits . . . . . . . . . . . . . . . . . . . 85
LIST OF ANNEXES AND EXHIBITS
   
        Annex A   Description of Affiliated Business Transfer
        Annex B   Description of COLI Business Transfer
        Annex C   Description of PPA Business Transfer
   
       Exhibit A  Indemnified Liabilities
       Exhibit B  Form of Parent Guarantees
   
       Exhibit 5.1     Incorporation and Qualification; Subsidiaries
       Exhibit 5.3     Acquired Subsidiaries
       Exhibit 5.10    Investments; Defaults
       Exhibit 5.11    Twindex Policies
       Exhibit 5.14    Material Contracts (Other than Reinsurance)
       Exhibit 5.15    Reinsurance Treaties
       Exhibit 5.16    Employees and Compensation
       Exhibit 5.17    Employee Benefit Plans
       Exhibit 5.22    Compliance with Applicable Laws and
                       Regulations
       Exhibit 5.24    Full Disclosure; No Misrepresentation
       Exhibit 5.26    Property
       Exhibit 5.27    Patents and Trademarks; Technology
       Exhibit 5.28    Absence of Certain Changes or Events
       Exhibit 5.29    Agreement Does Not Violate Other Agreements
       Exhibit 5.34    Related Party Agreements
       Exhibit 5.35    Policy Information
       Exhibit 5.36    COLI Agreements
       Exhibit 5.37    Certain Business Agreements
       Exhibit 5.38    Twindex Policies
       Exhibit 8.4     Severance Policy
          Exhibit 12.2    Certain Tax Matters
STOCK PURCHASE AGREEMENT
   
   
   STOCK PURCHASE AGREEMENT dated as of August 9, 1995, by and among
   HOUSEHOLD GROUP, INC., a Delaware corporation ("Seller"), HOUSEHOLD
   INTERNATIONAL, INC., a Delaware corporation ("Parent"), ALEXANDER
   HAMILTON LIFE INSURANCE COMPANY OF AMERICA, a stock life insurance
   company organized under the laws of the State of Michigan (the
   "Company"), and JEFFERSON-PILOT CORPORATION, a North Carolina
   corporation ("Purchaser").
   
   
                       W I T N E S S E T H
   
   WHEREAS, Seller owns all of the 375,000 shares of capital stock of
   the Company issued and outstanding as of the date hereof (the
   "Shares");
   
   WHEREAS, Parent has purchased from the Company and holds a $50
   million subordinated surplus note dated September 29, 1994 (the
   "Note");
   
   WHEREAS, Parent directly owns all the outstanding common stock of
   HFC and HFC directly owns all the outstanding capital stock of
   Seller;
   
   WHEREAS, Seller and Parent desire to sell and transfer to Purchaser
   and Purchaser desires to purchase and receive from Seller and
   Parent, as the case may be, the Shares and the Note for the
   consideration, upon the terms and subject to the conditions
   hereinafter set forth;
   
   WHEREAS, Parent desires that Purchaser purchase the Shares, which
   purchase is beneficial to Parent, and is willing to guarantee the
   obligations of Seller herein in order to induce Purchaser to
   purchase the Shares from Seller; 
   
   WHEREAS, except as otherwise provided herein, Purchaser and Seller
   have agreed to make Section 338(h)(10) Elections, all on the terms
   set forth in this Agreement; 
   
   WHEREAS, notwithstanding the preceding paragraph, the Parties have
   agreed that if a transaction qualifying under Section 351 of the
   Code, as more particularly described herein, can be accomplished on
   or before December 31, 1995 and satisfy certain conditions, and the
   Parties have jointly determined by September 30, 1995 that such
   conditions are likely to be satisfied, then the Parties will
   utilize such alternative structure rather than the structure
   including the Section 338(h)(10) Election described hereinabove;
   and
   
   WHEREAS, Parent, Seller and the Company intend to arrange for the
   contribution of the PPA Business Assets to the PPA Companies and
   the reinsurance of the PPA Business Liabilities by such PPA
   Companies and the contribution of the Affiliated Business Assets
   and the COLI Business Assets to the Retained Subsidiaries and the
   reinsurance of Affiliated Business Liabilities and the COLI
   Business Liabilities by the Retained Subsidiaries in accordance
   with the terms and conditions provided herein and in the
   Transaction Documents, followed by the distribution to Seller of
   the PPA Companies and the Retained Subsidiaries.
   
                           A G R E E M E N T
   
   NOW, THEREFORE, in consideration of the premises and the mutual
   agreements hereinafter set forth and other good and valuable
   consideration, the receipt and sufficiency of which are hereby
   acknowledged, the Parties hereto agree as follows:
   
   
                               ARTICLE I.
                              DEFINITIONS
   
   SECTION 1.1.  Defined Terms
   
             "acquisition proposal" shall have the meaning provided in
   Section
   7.10.
   
             "Acquired Companies" shall mean collectively, the Company and
   the
   Acquired Subsidiaries.
   
             "Acquired Subsidiaries" shall have the meaning provided in
   Section
   5.3.
   
             "Administrative Services Agreement" shall have the meaning
   provided
   in Section 7.20.
   
             "Affiliate" shall mean, with respect to any Person, any other
   Person that directly, or indirectly through one or more
   intermediaries, controls, is controlled by, or is under common
   control with the Person specified.
   
             "Affiliated Business" shall mean the business of initiating,
   selling and administering credit life and accident and health
   insurance business and specialty products in conjunction with the
   lending activities of Parent and its subsidiaries as undertaken by
   the Company and its subsidiaries.
   
             "Affiliated Business Assets" shall mean the assets of the
   Company
   allocated to the Affiliated Business in the manner described in
   Annex A.
   
             "Affiliated Business Liabilities" shall mean all of the
   liabilities
   and other obligations of the Company as described in Annex A and
   all other liabilities and other obligations of the Company and
   First Alexander Hamilton Life Insurance Company that arise out of
   the Affiliated Business Assets and arising or relating to the
   Affiliated Business, regardless of whether such liabilities or
   obligations are primary or secondary, direct or indirect, absolute
   or contingent, contractual, tortious or otherwise.
   
             "Affiliated Business Reinsurance Agreements" shall mean the
   reinsurance agreements between the Retained Subsidiaries and the
   Company or First Alexander Hamilton Life Insurance Company entered
   into in accordance with Annex A.
   
             "Affiliated Business Transfer" shall mean the transfer of the
   Affiliated Business Assets to, and the reinsurance of the
   Affiliated Business Liabilities by, the Retained Subsidiaries in
   accordance with Annex A.
   
             "AHLIC-AZ" shall mean the Alexander Hamilton Life Insurance
   Company
   of Arizona, a stock life and disability insurance company organized
   under the laws of the state of Arizona.
   
             "Alexander Hamilton Parties" shall mean collectively, Parent,
   Seller and the Company.
   
             "Allocation Agreement" shall have the meaning provided in
   Section 12.4(g).
   
             "Arbiter" shall have the meaning provided in Section 2.4.
   
             "Asset Allocation Agreement" shall mean the Asset Allocation
   Understanding regarding the allocation of assets to the Individual
   Business, dated as of August 9, 1995, by and between Parent and
   Purchaser.
   
             "Benefit Plans" shall have the meaning provided in Section
   5.17(a).
   
             "Business" shall mean the business of the Company and its
   subsidiaries as currently conducted, including the Affiliated
   Business, the COLI Business, the PPA Business and the Individual
   Business, but excluding the Property and Casualty Business.
   
             "Business Software Rights" shall have the meaning
   provided in Section 5.27(d).
   
             "Business Transfer" shall mean the Affiliated Business
   Transfer, the COLI Business Transfer and the PPA Business Transfer,
   collectively.
   
             "Closing" shall mean the satisfaction of the conditions
   to and the sale and purchase of the Shares and the Note, as set
   forth in Article III hereof.
   
             "Closing Date" shall mean the date mutually agreed upon
   by the Parties on which Seller and Parent sell and Purchaser
   acquires the Shares and the Note, as set forth in Section 3.1.
   
             "Closing Date Financial Statements" shall have the
   meaning provided in Section 2.3(b).
   
             "Closing Date GAAP Statements" shall have the meaning
   provided in Section 2.3(b).
   
             "Closing Date Statutory Statements" shall have the
   meaning provided in Section 2.3(b).
   
             "Code" shall mean the Internal Revenue Code of 1986, as
   amended, and the regulations promulgated thereunder, as amended.
   
             "COLI Business" shall mean the business of initiating,
   selling and administering corporate owned life insurance products
   as heretofore undertaken and defined as such by the Company and its
   subsidiaries.
   
             "COLI Business Assets" shall mean the assets of the
   Company allocated to the COLI Business in the manner described in
   Annex B. 
   
             "COLI Business Liabilities" shall mean all of the
   liabilities and other obligations of the Company as described in
   Annex B and all other liabilities and other obligations of the
   Company that arise out of the COLI Business Assets and arising or
   relating to the COLI Business, regardless of whether such
   liabilities or obligations are primary or secondary, direct or
   indirect, absolute or contingent, contractual, tortious or
   otherwise.  
   
             "COLI Business Reinsurance Agreements" shall mean the
   reinsurance agreements among the Retained Subsidiaries and the
   Company entered into in accordance with Annex B.
   
             "COLI Business Transfer" shall mean the transfer of the
   COLI Business Assets to, and the reinsurance of the COLI Business
   by, the Retained Subsidiaries in accordance with Annex B.
   
             "Company" shall have the meaning provided in the
   recitals.
   
             "Computer Services Agreement" shall have the meaning
   provided in Section 7.12(a).
   
             "Contracts" shall mean every contract, agreement, lease,
   license, relationship and commitment, written and oral, to which
   the Company or any Subsidiary is a party, or by which any of them
   is bound, excluding (i) Investments and (ii) Reinsurance Treaties.
   
             "Conversion Date" shall have the meaning provided in
   Section 7.12(a).
   
             "Covered Employee" shall have the meaning provided in
        Section 8.4(a).
   
             "Director" shall mean each and any member of the
   Company's board of directors.
   
             "Disputed Amounts" shall have the meaning provided in
   Section 2.4.
   
             "Dispute Notice" shall have the meaning provided in
   Section 2.4.
   
             "Dispute Notice Date" shall have the meaning provided in
   Section 2.4.
   
             "Encumbrances" shall mean any and all liens, security
   interests, pledges, charges, claims, restrictions, limitations,
   options, or other encumbrances of any kind, character, or
   description, whether or not of record.
   
             "Environmental Laws" shall mean all federal, state, local
   and foreign laws, statutes, ordinances, rules, regulations,
   principles of common law, orders, decrees, judgments and
   injunctions, relating to pollution, the environment, public health
   and safety, natural resources, nuclear power production or
   Hazardous Substances.
   
             "ERISA" shall mean the Employee Retirement Income
   Security Act of 1974, as amended from time to time, and any
   regulations or published rulings promulgated or issued thereunder.
   
             "ERISA Affiliate" shall have the meaning provided in
   Section 5.17(a).
   
             "ERISA Affiliate Title IV Plans" shall have the meaning
   provided in Section 5.17(b).
   
             "Evaluation Materials" shall have the meaning provided in
   Section 5.24(b).
   
             "Exhibit Contracts" shall have the meaning provided in
   Section 5.14(b).
   
             "Final Arbiter" shall have the meaning provided in
   Section 2.4.
   
             "Financial Statements" shall mean the GAAP Financial
   Statements and Statutory Statements, collectively.
   
             "GAAP" shall mean generally accepted accounting
   principles consistently applied.
   
             "GAAP Financial Statements" shall have the meaning
   provided in Section 5.9.
   
             "GAAP Reserves" shall mean, as of any date, the reserves
   and liabilities established by the Company and the Acquired
   Subsidiaries for past and future insurance policy benefits, losses,
   claims, expenses and contingencies under insurance policies as
   determined in accordance with GAAP.
   
             "Hazardous Substances" shall mean any waste, pollutant,
   hazardous substance, toxic substance, hazardous waste, special
   waste, nuclear substance or waste, radioactive substance or waste,
   petroleum or petroleum-derived substance or waste, including any
   such substance, waste or constituent regulated under, or defined
   by, any Environmental Laws.
   
             "HFC" shall mean Household Finance Corporation, a
   Delaware corporation.
             
             "HI RIP" shall mean the Household International
   Retirement Income Plan. 
             
             "HI TRIP" shall mean the Household International Tax
   Reduction Investment Plan.
   
             "HSR Act" shall mean the Hart-Scott-Rodino Antitrust
   Improvements Act of 1976, as amended, and the rules and regulations
   promulgated thereunder.
   
             "Indemnified Costs" shall have the meaning specified in
        Section 11.2(a).
   
             "Indemnified Liability" shall mean any Indemnified Cost
   whether relating to events which shall have occurred prior to, or
   after the Closing Date, and relating to any of the matters
   described on Exhibit A or in Section 11.2.
   
             "Individual Business" shall mean the business of
   initiating, selling and administering individual and group
   insurance products, including universal life insurance, flexible
   premium deferred annuities, and other life insurance and annuity
   products as undertaken by the Company and the Acquired Subsidiaries
   and excluding the PPA Business, the COLI Business and the
   Affiliated Business.
   
             "Intercompany Agreements" shall have the meaning provided
   in Section 5.34.
   
             "Investments" shall mean any and all stocks, bonds or
   other securities, equity or proprietary interest in or loans (other
   than loans to policyholders) to an individual or to a corporation
   (other than the Acquired Subsidiaries), partnership, joint venture,
   business enterprise or other entity of any nature.
   
             "IRS" shall mean the United States Internal Revenue
   Service.
   
             "knowledge of the Alexander Hamilton Parties" shall mean
   knowledge of any executive officer of any of the Alexander Hamilton
   Parties.
   
             "Legal Fees" shall mean, with respect to any indemnified
   Person, any and all fees, costs, and expenses of any kind
   reasonably incurred by such Person or its counsel in investigating,
   preparing for, defending against or providing evidence, producing
   documents or taking other action with respect to any threatened or
   asserted claim.
   
             "Licensed Rights" shall have the meaning provided in
   Section 5.27(a).
   
             "Material Adverse Effect"  shall mean an event affecting
   (i) the Company or any of the Acquired Subsidiaries that is or
   would reasonably be expected to be materially adverse to the
   income, operations, financial condition, assets, liabilities or
   revenues, of the Company and the Acquired Subsidiaries, taken as a
   whole, or of First Alexander Hamilton Life Insurance Company, after
   giving effect to this Agreement and the transactions contemplated
   hereby or (ii) the ability of any of Seller, Parent or the Company
   to execute and deliver this Agreement and the Transaction Documents
   and to consummate the transactions and perform its obligations
   contemplated hereby and thereby.
   
             "Minimum Statutory Equity Amount" shall have the meaning
   provided in Section 2.3(e).
   
             "Note" shall have the meaning provided in the recitals.
   
             "Note Purchase Price" shall have the meaning provided in
   Section 2.2(b).
   
             "OSHA" shall mean the Occupational Safety and Health
   Administration.
   
             "Owned Software" shall have the meaning provided in
   Section 5.27(d).
   
             "Parent" shall have the meaning provided in the recitals.
   
             "Parent Guarantees" shall mean the Guarantees from Parent
   to Purchaser and the Company in the form of Exhibits B-1 to B-4
   hereto.
   
             "Parties" or "Party" shall mean either of Seller,
   Purchaser, Parent, or the Company or in the plural shall mean
   collectively, Seller, Purchaser, Parent, and the Company.
   
             "Patent and Trademark Rights" shall have the meaning
   provided in Section 5.27(a).
   
             "Person" shall mean an individual, a corporation, a
   partnership, an association, a joint-stock company, a trust, any
   unincorporated association or organization, or a government or
   political subdivision thereof.
   
             "PIC" shall mean Prospect Life Insurance Company, a stock
   life and disability insurance company to be organized pursuant to
   the Arizona Insurance Code.
   
             "Potential Tax Liability" shall have the meaning provided
   in Section 12.4(k).
   
             "PPA Business" shall mean the business of initiating,
   selling and administering periodic payment annuities as heretofore
   undertaken by the Company and its subsidiaries.
   
             "PPA Business Assets" shall mean the assets of the
   Company allocated to the PPA Business in the manner described in
   Annex C.
   
             "PPA Business Liabilities" shall mean all of the
   liabilities and other obligations of the Company as described in
   Annex C and all other liabilities and other obligations of the
   Company that arise out of the PPA Business Assets and arising or
   relating to the PPA Business, regardless of whether such
   liabilities or obligations are primary or secondary, direct or
   indirect, absolute or contingent, contractual, tortious or
   otherwise.
   
             "PPA Business Reinsurance Agreements" shall mean the
   reinsurance agreements among AHLIC-AZ or PIC and the Company
   entered into in accordance with Annex C.
   
             "PPA Business Transfer" shall mean the transfer of the
   PPA Business Assets to, and the reinsurance of the PPA Business by,
   the PPA Companies in accordance with Annex C.
   
             "PPA Companies" shall mean collectively, PIC and AHLIC-
   AZ.
   
             "Producers" shall mean all agents, brokers or others that
   have the authority to generate insurance business for the Company
   or any of its Subsidiaries, including the authority to bind the
   Company or a Subsidiary to any contract for insurance.
   
             "Producer Plans" shall have the meaning provided in
   Section 5.18(b).
   
             "Property and Casualty Business" shall mean the business
   of initiating and selling property and casualty insurance and
   workers' compensation insurance.
   
             "Purchase Price" shall have the meaning provided in
   Section 2.2(b).
   
             "Purchaser" shall have the meaning provided in the
   recitals.
   
             "Realized Capital Gains" shall mean an amount equal to
   *CONFIDENTIAL 1*
   
             "Related Party Contracts" shall mean Contracts involving
   an Affiliate of the Company as a party or otherwise.
   
             "Release" shall mean any release, spill, emission,
   leaking, pumping, injection, deposit, disposal, discharge,
   dispersal, leaching or migration into the indoor or outdoor
   environment or into or out of any property, including the movement
   of Hazardous Substances through or in the air, soil, surface water,
   ground water or property.
   
             "Reinsurance Treaties" shall mean all reinsurance
   treaties or agreements (including facultative agreements) under
   which the Company or any of its subsidiaries has ceded or assumed
   any liability or potential liability relating to its Business to a
   Person other than the Acquired Companies.
   
             "Relicensed Software Rights" shall have the meaning
   provided in Section 5.27(d).
   
             "Retained Subsidiaries" shall mean Hamilton National Life
   Insurance Company,  Alexander Hamilton Insurance Company of America
   and Alexander Hamilton Insurance Agency, Inc., each a Michigan
   corporation and wholly owned subsidiary of the Company.
   
             "Section 351 Transaction Structure" shall have the
   meaning provided in Section 12.4(m).
   
             "Section 338(h)(10) Elections" shall have the meaning
   provided in Section 12.4(b).
   
             "Securities Act" shall mean the United States Securities
   Act of 1933, as amended.
   
             "Seller" shall have the meaning provided in the recitals.
   
             "Sellers" shall mean together Parent and Seller.
   
             "Shares" shall mean the 375,000 issued and outstanding
   shares of common stock of the Company with a par value of $10.00
   per share, being all of the Company's issued and outstanding
   shares.
   
             "Share Purchase Price" shall have the meaning provided in
   Section 2.2(a).
   
             "Software Know-how" shall have the meaning provided in
   Section 5.27(d).
   
             "Statutory Accounting Principles" shall mean for any
   Person the statutory accounting principles and applicable actuarial
   standards of practice consistently applied in accordance with the
   rules and regulations of the National Association of Insurance
   Commissioners and the state of domicile of such Person.
   
             "Statutory Net Income" shall mean, for any period, net
   income of the Company and the Acquired Subsidiaries as reflected in
   a statement which has been prepared in conformity with Statutory
   Accounting Principles.
   
             "Statutory Reserves" shall mean, as of any date, the
   reserves and liabilities established by the Company and the
   Acquired Subsidiaries for past and future insurance policy
   benefits, losses, claims and expenses under insurance policies and
   any other reserve which is contemplated under applicable Statutory
   Accounting Principles.
   
             "Statutory Statements" shall have the meaning provided in
   Section 5.8.
   
             "Straddle Period" shall have the meaning provided in
   Section 12.5.
   
             "subsidiary" shall mean, for any Person, any entity in
   which such Person has an equity interest of 10% or more.
   
             "Tax" or "Taxes" shall mean all taxes and similar
   charges, fees, and levies imposed by any governmental authority,
   entity, or body, or subdivision thereof, whether based upon or
   measured by gross or net income or otherwise, including, without
   limitation, income, gross receipts, premiums, profits, sales, use,
   occupation, value added, ad valorem, transfer, franchise,
   withholding, payroll, employment, excise, or property taxes,
   together with any interest, toll charges, additions to tax, or
   penalties imposed with respect thereto.
   
             "Tax Benefit" shall have the meaning provided in
   Section 12.6.
   
             "Tax Dispute Accountants" shall have the meaning provided
   in Section 12.7.
   
             "Tax Returns" shall mean any return, declaration, report,
   claim for refund or information return or statement relating to
   Taxes, including any schedule or attachment to such documents and
   any amendment of such documents.
   
             "Transaction Documents" shall mean collectively the
   Transferred Business Reinsurance Agreements, the Computer Services
   Agreement, the Administrative Services Agreement, the Asset
   Allocation Agreement and the Parent Guarantees.
   
             "Transferred Assets" shall mean collectively, the PPA
   Business Assets, the COLI Business Assets and the Affiliated
   Business Assets. 
   
             "Transferred Business Reinsurance Agreements" shall mean
   collectively the PPA Business Reinsurance Agreements, the COLI
   Reinsurance Agreement and the Affiliated Business Reinsurance
   Agreements.
   
             "Transferred Liabilities" shall mean collectively the PPA
   Business Liabilities, the COLI Business Liabilities and the
   Affiliated Business Liabilities.
   
             "Twindex Policies" shall mean collectively the insurance
   (including annuity) products initiated or sold by the Business
   which include one or more endorsements referring to an interest
   crediting rate which cannot be less than the greater of a specified
   long-term rate and specified short-term rate, marketed under the
   name "Twindex."
   
        SECTION 1.2.  Other Terms
   
             Where used herein, and unless the content otherwise
   requires:
   
                  (i)  words importing the singular number or plural
             number shall include the plural number and singular
             number respectively;
   
                  (ii) words importing the masculine gender shall
             include the feminine and neuter genders and vice versa;
   
                  (iii)     reference to "Business Day" means a day on
             which banks are open for business in Chicago, Illinois,
             other than a Saturday or Sunday; 
   
                  (iv) reference to "include", "includes", and
             "including" shall be deemed to be followed by the phrase
             "without limitation;" and
   
                  (v)  reference in this Agreement to "herein,"
             "hereby" or "hereunder", or any similar formulation,
             shall be deemed to refer to this Agreement as a whole,
             including the Exhibits.
   
   
                              ARTICLE II.
                      PURCHASE AND SALE OF SHARES
   
        SECTION 2.1.  Transfer of Shares
   
             Upon the terms and subject to the conditions contained
   herein, and in reliance on the respective representations and
   warranties of the Parties, on the Closing Date, Seller and Parent
   as the case may be, will sell, convey, transfer, assign, and
   deliver to Purchaser, and Purchaser will purchase, the Shares from
   Seller for the Share Purchase Price, and the Note from Parent for
   the Note Purchase Price, in each case free and clear of all
   Encumbrances.
             
        SECTION 2.2.  Purchase Price
   
             The purchase price shall be the aggregate of all amounts
   set forth below: 
   
             (a)  to Seller for the Shares: $525,000,000 (the "Share
   Purchase Price"), subject to adjustment pursuant to Section 2.3. 
   
             (b)  to Parent for the Note: $50,000,000 (the "Note
   Purchase Price," and together with the Share Purchase Price, the
   "Purchase Price").
   
        SECTION 2.3.  Post-Closing Adjustment
   
             (a)  The Share Purchase Price shall be subject to
   adjustment after the Closing Date as specified in this Section 2.3.
        
             (b)  As soon as practicable, but in any event within 90
   calendar days following the Closing Date, the Company shall prepare
   and deliver to Parent, Seller and Purchaser the statements of
   assets, liabilities, surplus, and other funds and summary of
   operations and cash flows of the Company and each of the Acquired
   Subsidiaries as of, and for the period beginning January 1, 1995
   and ending on, the Closing Date (or the most recent end of a month
   if the Closing Date is not the last Business Day of a month) (the
   "Closing Date Statutory Statements"), which shall be prepared in
   conformity with Statutory Accounting Principles, and the
   consolidated balance sheets, statements of income, stockholder's
   equity and cash flows of the Company and the Acquired Subsidiaries
   as of and for the period beginning January 1, 1995 and ending on,
   the Closing Date (or the most recent end of a month if the Closing
   Date is not the last Business Day of a month), which shall be
   prepared in accordance with GAAP (the "Closing Date GAAP
   Statements" and collectively, the "Closing Date Financial
   Statements"), except that such Closing Date Financial Statements
   shall reflect an asset-by-asset recalculation in accordance with
   Statement of Financial Accounting Standards No. 91 and other
   applicable GAAP requirements as of the Closing Date (or the most
   recent end of a month if the Closing Date is not the last Business
   Day of a month) of the book value of all collateralized mortgage
   obligations held by any of the Acquired Companies.  The Closing
   Date Financial Statements shall present fairly, in all material
   respects, in accordance with Statutory Accounting Principles or
   GAAP, as the case may be, the financial position of the Company and
   the Acquired Subsidiaries (on a consolidated basis with respect to
   the Closing Date GAAP Statements) as of the end of such period, and
   the results of their operations for the periods specified and
   ending on the Closing Date (or the most recent end of a month if
   the Closing Date is not the last Business Day of a month).  The
   Company shall also deliver with such statements a calculation of
   Realized Capital Gains.
   
             (c)  Subsequent to the delivery of the Closing Date
   Financial Statements, Purchaser shall give Parent and its
   accountants, actuaries, counsel and other representatives
   reasonable access to the books and records of the Company and the
   Acquired Subsidiaries in order to make such investigations as it
   shall desire in conjunction with the evaluation by Parent of the
   Closing Date Financial Statements.  During such period, Purchaser
   shall permit Parent and its representatives to consult with the
   respective employees, auditors, actuaries, attorneys and agents of
   the Company and the Acquired Subsidiaries.
   
             (d)  The Closing Date Financial Statements shall be
   deemed final upon the earliest of the date on which Parent and
   Purchaser jointly agree that the Closing Date Financial Statements
   are final, the 31st day following the delivery of the Closing Date
   Financial Statements, if neither Parent nor Purchaser has notified
   the other of a dispute in amounts shown on the Closing Date
   Financial Statements and the date on which all disputes relating to
   such statements and calculations between Purchaser and Parent are
   resolved in accordance with Section 2.4.  
   
             (e)  On the fifth Business Day following the date on
   which the Closing Date Financial Statements are deemed final,
   Purchaser or Seller, as the case may be, shall pay to the other the
   amount, if any, that any payment to be received by such Person
   pursuant to this Section 2.3(e) exceeds any payment otherwise to be
   made by such Person pursuant to this Section 2.3(e) as follows: 
   Seller shall be obligated to pay to Purchaser, by wire transfer,
   together with interest on any such adjustment amount at an annual
   interest rate of *CONFIDENTIAL 2* (based upon a 365-day year) from
   the Closing Date to (but not including) the date of such payment,
   the amount, if any, that, after giving effect to the Business
   Transfer and the dividends and payments payable pursuant to
   Section 7.17 and without giving effect to any sale of the building
   contemplated by Section 7.15 (such building to be reflected in the
   Closing Date Statutory Statements at its historical book value
   notwithstanding its sale), the sum of the amount of the capital and
   surplus of the Company and the asset valuation reserve and interest
   maintenance reserve of each of the Acquired Companies, each as set
   forth in the Closing Date Statutory Statements, is less than
   *CONFIDENTIAL 3* (the "Minimum Statutory Equity Amount") and
   (ii) Purchaser shall be obligated to pay to Seller, by wire
   transfer, together with interest at an annual interest rate of
   *CONFIDENTIAL 3* (based upon a 365-day year) from the Closing Date
   to (but not including) the date of such payment, any dividend or
   interest payment allowable pursuant to Section 7.17 for which
   governmental approval has been timely applied for and not received
   prior to the Closing Date. 
   
        SECTION 2.4.  Dispute Resolution
   
             In the event that the Parties hereto do not agree to the
   determination of the Minimum Statutory Equity Amount pursuant to
   Section 2.3, or any other financial calculation (other than Tax
   matters) arising under the provisions of this Agreement (the
   "Disputed Amounts"), the disputing Party shall provide notice of
   such disagreement to the other Parties hereto (the "Dispute
   Notice", and the date of its delivery, the "Dispute Notice Date"). 
   The chief financial officer of Purchaser and the chief financial
   officer of Parent shall meet (by conference telephone call or in
   person at a mutually agreeable site) within one week after notice
   of a disagreement is given as provided above.  The chief financial
   officers shall attempt to make a final determination of the
   Disputed Amounts, and if the chief financial officers reach
   agreement, any payments shall be made within five days in
   accordance with such agreement.  If the chief financial officers do
   not reach agreement within a reasonable time, either or both of
   such chief financial officers shall give notice of an impasse, in
   which case the chief executive officer of Purchaser and the chief
   executive officer of Parent shall meet (by conference telephone
   call or in person at a mutually agreeable site) within one week
   after notice of an impasse is given by the chief financial
   officers.   If the chief executive officers have hereto not reached
   agreement as to the Disputed Amounts within a reasonable time,
   either chief executive officer may give notice of an impasse, and
   such determination shall be promptly submitted to a nationally
   recognized independent public accounting firm or a nationally
   recognized actuarial firm (an "Arbiter") jointly selected by Parent
   and Purchaser.  If Parent or Purchaser do not agree upon the joint
   selection of an Arbiter within five (5) Business Days following the
   notice of such impasse by the chief executive officers, either
   Parent or Purchaser may designate a proposed qualified Arbiter to
   the other by written notice.  Within five (5) Business Days such
   other Party shall either agree to the proposed qualified Arbiter or
   propose a different Arbiter and in the latter case the two Arbiters
   so proposed shall within five (5) Business Days thereafter select
   an Arbiter to make a final determination of the Disputed Amounts. 
   The Arbiter so selected by either Parent and Purchaser jointly or
   by the Arbiters (the "Final Arbiter") shall make its determination
   of the Disputed Amounts solely in accordance with the terms of this
   Agreement.  The Parties shall cooperate fully in assisting the
   Final Arbiter in calculating the Disputed Amounts and shall take
   such actions as necessary to expedite and to cause the Final
   Arbiter to expedite such calculation.  Each of Parent and Purchaser
   shall pay one-half of the total fees and expenses of the Final
   Arbiter.
   
   
                             ARTICLE III.
                               CLOSING 
   
        SECTION 3.1.  Time and Place of Closing
   
             (a)  Upon the terms and subject to the conditions
   contained in this Agreement, the Closing of the transactions
   contemplated by this Agreement will take place at the offices of
   Purchaser in Greensboro, North Carolina, at 9:00 a.m., Eastern
   time, on October 2, 1995 (the Closing on such date to be given
   effect as of September 30, 1995), or at such place, date and time
   as the Parties may mutually agree within 30 days of the date the
   conditions set forth in Article IX are satisfied or waived, but in
   no event later than December 31, 1995.
   
             (b)  If all of the conditions to Closing contained in
   this Agreement have been satisfied other than receipt of approval
   of the insurance department of the State of New York, the Parties
   agree to use their best efforts to effect a Closing promptly,
   including effecting a Closing prior to receipt of such approval,
   through the utilization of a trust or other arrangement to hold the
   capital stock of First Alexander Life Insurance Company; provided
   that no Party shall be required to take any action that would have
   a materially adverse effect on it or the Acquired Companies.
   
        SECTION 3.2.  Deliveries by Sellers
   
             At the Closing, Sellers will deliver the following to
   Purchaser:
   
             (a)  stock certificates representing the Shares,
   accompanied by stock powers duly executed in blank or duly executed
   instruments of transfer, and any other documents that are necessary
   to transfer to Purchaser good title to the Shares;
   
             (b)  the original Note with an assignment to Purchaser
   thereof;
   
             (c)  copies of the articles of incorporation and by-laws
   of each of Parent, Seller and the Acquired Companies;
   
             (d)  the stock books, stock ledgers, minute books, and
   corporate seals of the Acquired Companies and the stock
   certificates evidencing ownership of the Acquired Subsidiaries;
   
             (e)  the opinion, certificates, and other documents set
   forth in Section 9.3 of this Agreement; and
   
             (f)  resignations of such directors and officers of the
   Acquired Companies as are employees of Parent or HFC and such other
   directors or officers as Purchaser may request.
   
        SECTION 3.3.  Deliveries by Purchaser
   
             At the Closing, Purchaser will deliver the following:
   
             (a)  the Purchase Price, in immediately available funds,
   to such bank accounts of Seller and Parent as Parent designates in
   writing  to Purchaser.
   
             (b)  to Sellers, the opinion, certificates, and other
   documents set forth in Section 9.2 of this Agreement.
   
   
                              ARTICLE IV.
                          GUARANTEE BY PARENT
   
        SECTION 4.1.  Guarantee of Seller's Performance  
   
             Parent unconditionally and irrevocably guarantees to
   Purchaser the due and punctual performance of all of Seller's
   obligations set forth in this Agreement.
   
        SECTION 4.2.  Waiver  
   
             Parent waives (a) any right to require Purchaser to
   exhaust remedies against Seller, (b) notice of any modifications of
   this Agreement, (c) notice of any default under or breach of this
   Agreement, (d) demand and presentation for payment upon Seller,
   (e) protest, notice of protest and diligence of bringing suit
   against Seller, and (f) any other defenses available to Parent that
   are not available to Seller.
   
   
                              ARTICLE V.
   
                  REPRESENTATIONS AND WARRANTIES OF 
                           SELLER AND PARENT
   
        Seller and Parent jointly and severally represent and warrant
   to Purchaser as follows:
   
        SECTION 5.1.  Incorporation and Qualification; Subsidiaries
   
             (a)  Each of Parent, Seller, the Company and the Acquired
   Subsidiaries is a corporation duly incorporated, validly existing
   and in good standing, if applicable, under the laws of the
   jurisdiction of its incorporation and has all requisite corporate
   power and authority to own, lease and operate its properties and to
   carry on its business as now being conducted, and is duly qualified
   to do business and is in good standing, where applicable, in each
   jurisdiction in which the nature of its business or the ownership
   or leasing of its properties make such qualification necessary,
   except where the failure to be so qualified or in good standing
   would not have a Material Adverse Effect. 
   
             (b)  Attached hereto as Exhibit 5.1(b) is a complete and
   accurate list of all states and territories where the Company and
   each of the Acquired Subsidiaries has written or is qualified to
   write insurance, which list includes all jurisdictions in which
   failure to be so qualified, if qualification is required, would
   have a Material Adverse Effect; a list of all licenses and permits
   held by the Company and each of the Acquired Subsidiaries issued by
   any state insurance authority, and a description of the classes and
   lines of business the Company and each of the Acquired Subsidiaries
   is authorized to write in each jurisdiction.  Except as set forth
   in Exhibit 5.1(b), the Company's and each of the Acquired
   Subsidiaries' authority to write the classes and lines of insurance
   business reflected on said Exhibit is unrestricted and neither the
   Company nor any of the Acquired Subsidiaries is a party to any
   agreement, formal or informal, with any state insurance regulatory
   official limiting the Company's or such Acquired Subsidiary's
   ability to make full use of the licenses or permits which have been
   issued to it or requiring the Company and the Acquired Subsidiaries
   to comply with regulatory standards, procedures or requirements
   different from those applicable to companies with licenses or
   permits identical to those issued to the Company or such Acquired
   Subsidiary.  The licenses and permits listed on Exhibit 5.1(b)
   constitute all licenses and permits material to the conduct of
   Business, as it is now conducted and will be conducted prior to the
   Closing.  All such licenses and permits are in full force and
   effect and there are no reasonable grounds to believe that any such
   license or permit will not, in the ordinary course, be renewed upon
   its expiration.  Except as set forth on Exhibit 5.1(b), the Company
   and the Acquired Subsidiaries have not incurred fines or penalties
   in excess of $25,000 during the 36 month period prior to the date
   hereof and have filed all reports, paid all fees and taken all
   other actions under any applicable statute, rule or regulation by
   any state regulatory agency having jurisdiction over its activities
   which are required to comply in all material respects with all
   state insurance laws and regulations applicable to the Business. 
   Except as set forth in Exhibit 5.1(b), neither the Company nor any
   of the Acquired Subsidiaries has within the last five years (i) had
   any of its licenses or permits revoked or suspended, (ii) been
   involved in a proceeding or investigation, whether formal or
   informal, to revoke, suspend, limit or restrict such licenses or
   permits or (iii) been notified by any licensing authority that such
   authority might have cause to revoke, suspend, limit or restrict
   any such license or permit and to the best knowledge of the
   Alexander Hamilton Parties, no such suspension, revocation or
   limitation is threatened by any governmental authority or
   department.
   
             (c)  Attached hereto as Exhibit 5.1(c) is a complete and
   accurate list of all states and territories in which the Company or
   any Acquired Subsidiary currently has applications for licenses,
   permits or certificates of authority pending.  Exhibit 5.1(c) also
   sets forth the current status of all such applications.
   
             (d)  The Company and each Acquired Subsidiary belong to
   all state required rating bureaus, service organizations,
   insolvency funds, assigned risk pools and similar organizations
   necessary to conduct the Business as it is now being, and has been,
   conducted.
   
        SECTION 5.2.  Articles of Incorporation--By-Laws
   
             Sellers have delivered to Purchaser complete and correct
   copies of the articles or certificate of incorporation and all
   amendments thereto to the date hereof, and the by-laws, as amended
   to the date hereof, and any other governing documents (including
   stockholder agreements) of the Company and the Acquired
   Subsidiaries.  The minutes of the board of directors', any
   investment committees and stockholders' meetings and the stock
   books of the Company and the Acquired Subsidiaries, all of which
   have been previously made available to Purchaser, are the complete
   and correct records of such board of directors', investment
   committee's and stockholders' meetings and stock issuances through
   and including the date hereof and reflect all transactions through
   and including the date hereof required to be contained in such
   records, as well as those matters customarily contained in records
   of such type, and all such meetings were duly called.
   
        SECTION 5.3.  Acquired Subsidiaries
   
             All of the subsidiaries of the Company (other than the
   subsidiaries to be transferred pursuant to the Business Transfer)
   (the "Acquired Subsidiaries") are set forth in Exhibit 5.3 attached
   hereto.  The Company has no ownership interest, directly or
   indirectly, in any other Person, which is not shown on its Annual
   Statement as of December 31, 1994, as filed with Michigan
   Department of Insurance, except for such ownership interests that
   have been acquired as Investments for the Company and the Acquired
   Subsidiaries in the ordinary course of their business since
   December 31, 1994.  Except as set forth in Exhibit 5.3, the Company
   owns, directly or indirectly, all of the outstanding capital stock
   of each Acquired Subsidiary, free and clear of all Encumbrances,
   except such restrictions on transfer as may apply under applicable
   federal or state securities laws, the New York Insurance Code and
   any other state insurance code,  and all of such capital stock has
   been duly authorized and is validly issued, fully paid and
   nonassessable and was not issued in violation of any preemptive
   rights.  There are no outstanding options or rights to subscribe
   to, or any Contracts to issue or sell any shares of the capital
   stock or any securities or obligations convertible into or
   exchangeable for, or giving any Person any right to acquire, any
   shares of the capital stock or any other securities of any Acquired
   Subsidiary or any stock appreciation rights or similar rights
   relating to the capital stock of any Acquired Subsidiary.  Upon
   consummation of the transactions contemplated by this Agreement and
   the Transaction Documents, the Company will continue to own good
   and valid title to the stock of each Acquired Subsidiary, free and
   clear of all Encumbrances, except such restrictions on transfer as
   may apply under applicable federal or state securities laws, the
   New York Insurance Code and any other state insurance code.
   
        SECTION 5.4.  Scope of Business  
   
             Immediately prior to the consummation of the transactions
   contemplated by this Agreement and the Transaction Documents, the
   Company and the Acquired Subsidiaries will be involved in no other
   type of business activities except for the Business.
   
        SECTION 5.5.  Authorization
   
             Except for any regulatory or governmental consents or
   notices that may be required, Seller, Parent and the Company each
   have all necessary corporate power and authority to enter into this
   Agreement and the Transaction Documents and to perform them in
   accordance with their terms.  The execution and delivery of this
   Agreement and the Transaction Documents and the sale and other
   obligations contemplated hereby and thereby have been duly
   authorized by all requisite corporate action of Seller, Parent and
   the Company.  This Agreement has been, and each of the Transaction
   Documents will be, duly executed and delivered by each of these
   Parties, and will constitute valid and binding obligations of each
   of them, enforceable against such Parties, in accordance with the
   terms hereof and thereof and subject, as to the enforceability of
   remedies, to applicable bankruptcy, insolvency, reorganization,
   moratorium and similar laws of general applicability relating to or
   affecting creditors' rights and to general principles of equity.
   
        SECTION 5.6.  Capitalization  
   
             The duly authorized capital stock of the Company consists
   solely of 500,000 shares of Common Stock, par value $10.00 per
   share, 375,000 of which are issued and outstanding.  The Company
   has no other shares of capital stock of any class or other equity
   securities authorized, issued or outstanding, and there are no
   outstanding or authorized options, warrants, calls, subscriptions,
   rights, agreements or commitments of any character obligating the
   Company to issue any shares of its capital stock or securities
   convertible into or exchangeable for or evidencing the right to
   purchase or subscribe for any shares of its capital stock or the
   stock of any Acquired Subsidiary.  All of the Shares have been
   validly issued, fully paid and are nonassessable and free of
   preemptive rights.
   
        SECTION 5.7.  Ownership of Shares and Note  
   
             Seller is the beneficial and legal registered owner of
   all of the Shares and Parent is the beneficial and legal registered
   owner of the Note.  Each of Seller and Parent has good and valid
   title thereto and the right to sell, assign, and transfer the same
   to Purchaser free and clear of all Encumbrances except such
   restrictions as to further transfer that may apply under any
   applicable federal or state securities laws, the Michigan Insurance
   Code or any other state insurance code or insurance laws applicable
   to the Acquired Companies.  Upon delivery of the Shares and the
   Note to Purchaser at the Closing, Purchaser will acquire good and
   valid title thereto free and clear of any and all Encumbrances
   except such restrictions as to further transfer that may be imposed
   by federal or state securities laws, the Michigan Insurance Code or
   any other state insurance code or insurance laws applicable to the
   Acquired Companies.
   
        SECTION 5.8.  Statutory Statements  
   
             Seller previously made available to Purchaser a complete
   copy of the Annual Statements of the Company, and each of the
   Acquired Subsidiaries dated December 31, 1992, December 31, 1993
   and December 31, 1994, as filed with the department of insurance of
   such company's state of domicile, a complete copy of the Quarterly
   Statement of the Company and each of the Acquired Subsidiaries,
   dated March 31, 1995, as filed with the department of  insurance of
   such company's state of domicile, and will deliver as soon as they
   are filed such interim financial statements that may be required to
   be filed with any state departments of insurance prior to the
   Closing Date (collectively, the "Statutory Statements").  The
   Statutory Statements have been or will be prepared in accordance
   with Statutory Accounting Principles.  The Statutory Statements
   present (and such statements to be delivered hereafter will
   present)  fairly in all material respects in accordance with
   Statutory Accounting Principles the financial position of the
   company presented as of the dates indicated and the results of its
   operations for the periods therein specified.
   
        SECTION 5.9.  GAAP Financial Statements  
   
             Prior to the Closing Date Seller will deliver to
   Purchaser audited consolidated balance sheets of the Company and
   its subsidiaries at December 31, 1994 and 1993 and consolidated
   statements of income, cash flows and changes in stockholder's
   equity for the three years ended December 31, 1994, and the notes
   thereto, and has previously delivered the unaudited consolidated
   balance sheet of the Company and its subsidiaries as of March 31,
   1995, and consolidated statements of income for the three months
   ended March 31, 1994 and 1995, and will deliver on a timely basis
   interim financial statements as of the end of each subsequent
   quarter and for the quarter and year then ended, in each case
   prepared in accordance with GAAP (collectively, the "GAAP Financial
   Statements").  The GAAP Financial Statements present fairly or will
   present fairly in all material respects in accordance with GAAP the
   consolidated financial position of the Company and its subsidiaries
   as of the dates indicated and the results of their operations for
   the periods therein specified. 
   
        SECTION 5.10.  Investments; Defaults
   
             (a)  Seller has previously delivered to Purchaser a
   complete list of all Investments owned, directly or indirectly, by
   the Company and the Acquired Subsidiaries as of June 30, 1995. 
   Except as set forth on Exhibit 5.10(a)(1) (as updated for
   subsequent events), none of the Alexander Hamilton Parties has
   received notice of (i) any payment defaults with respect to any
   Investment or (ii) any other notice of nonperformance of any
   Investment. Exhibit 5.10(a)(1) also contains a list of all
   bankruptcies, nonperforming assets, foreclosures and payment
   defaults known to the Alexander Hamilton Parties with respect to
   the Investments as of June 30, 1995.  Except as disclosed on
   Exhibit 5.10(a)(2), all of the Investments constitute admitted
   assets on the Company's Statutory Statements and their carrying
   values have been described in conformity with Statutory Accounting
   Principles and in accordance with values prescribed by the National
   Association of Insurance Commissioners, when appropriate,
   consistent with the prior reporting practices of the Company and
   the Acquired Subsidiaries. 
   
             (b)  To the best knowledge of the Alexander Hamilton
   Parties, neither the Company nor any of the Acquired Subsidiaries
   has committed any act or omitted to take any act which would make
   any of the Investments not enforceable against the issuer thereof
   or the parties thereto in accordance with their terms, except that
   (i) such enforcement may be subject to bankruptcy, insolvency,
   reorganization, moratorium or other similar laws now or hereafter
   in effect relating to creditors' rights generally or the rights of
   creditors of insurance companies generally and (ii) the remedy of
   specific performance and injunctive and other forms of relief may
   be subject to equitable defenses and to the discretion of the court
   before which any proceeding therefor may be brought.
   
             (c)  Except as set forth on Exhibit 5.10(c), since
   December 31, 1994, none of the Company nor any Acquired Subsidiary
   has (i) purchased or otherwise invested in or committed to purchase
   or otherwise invest in any interest in real property (including,
   any extension of credit secured by a mortgage or deed of trust),
   (ii) purchased or otherwise invested in or committed to purchase or
   otherwise invest in securities which are below investment grade at
   the time of purchase, (iii) entered into any agreement or
   commitment with respect to the purchase or other acquisition, sale
   or other disposition or allocation of any Investment with any
   Affiliate or other entity in which an Affiliate owns an equity
   interest of more than 25% or (iv) entered into any agreement or
   commitment with respect to any foreign Investments.  For the
   purposes of this Section 5.10 the term "investment grade" shall
   mean with respect to any Investment which is an evidence of
   indebtedness, a rating of Baa3 or higher by Moody's Investors
   Service Inc., a rating of BBB- or higher by Standard &  Poor's
   Corporation or category 2 or higher by the National Association of
   Insurance Commissioners Securities Valuation Office.
   
        SECTION 5.11.  Twindex Policies
   
             Exhibit 5.11 sets forth a complete and accurate list of
   all insurance (including annuity) policy forms issued by the
   Company or any Acquired Subsidiary which constitute Twindex
   Policies, and the additional information shown on Exhibit 5.11 for
   such policies is accurate in all material respects.
   
        SECTION 5.12.  Reserves
   
             The GAAP Reserves and Statutory Reserves reflected in the
   Financial Statements were, or will be, computed in accordance with
   accepted actuarial standards as prescribed by the American Academy
   of Actuaries, are or will be fairly stated in accordance with sound
   actuarial principles, were, or will be, computed in a manner
   consistent with the computation of such items in the preceding
   corresponding period.
   
        SECTION 5.13.  Bank Accounts; Custodial Accounts; Receivables
   
             Prior to the Closing Date, other than petty cash accounts
   aggregating to less than $150,000, the Company will have delivered
   a true and complete list (in all material respects) and brief
   description (including the account or box number and the names of
   all Persons currently authorized to draw thereon, withdraw
   therefrom or have access thereto) of each and every bank account,
   safe deposit box, brokerage account, trust account, depository
   account or other custodial account of the Acquired Companies
   including, but not limited to, any deposits maintained with any
   governmental agency or department for the purpose of obtaining or
   continuing any authority within the subject jurisdiction or
   otherwise.  Other than the assets deposited in such accounts, the
   Acquired Companies have no other liquid assets or Investments held
   or maintained with any other Person at any location. 
   
        SECTION 5.14.  Material Contracts (Other Than Reinsurance)
   
             (a)  Each Contract to which the Company or any Acquired
   Subsidiary is a party or bound or to which it or its property is
   subject is listed on Exhibit 5.14, except for Contracts set forth
   or cross-referenced on Exhibits 5.10, 5.11, 5.16, 5.17, 5.18, 5.19,
   5.26, 5.27, 5.34 and 5.36 and except for Contracts:
   
                  (i)  Relating to insurance Contracts issued or to be
             issued in the ordinary course of business which involve
             annual premiums of less than $500,000;
   
                  (ii) For the purchase or rental of materials and
             supplies by the Company or any Acquired Subsidiary
             entered into in the ordinary and usual course of business
             which do not individually exceed $250,000 (treating each
             purchase order as a separate agreement); and 
   
                  (iii)     For the purchase of services by the
             Company or any Acquired Subsidiary entered into in the
             ordinary course of business which do not individually
             involve an amount in excess of $250,000 and which are
             reasonably expected to be fully performed within 12
             months of their respective dates.
   
             (b)  Except as set forth on Exhibit 5.14(b):
   
                  (i)  Neither the Company nor any Acquired Subsidiary
             has any outstanding Contract (other than for vested
             commissions or vested deferred compensation) with any
             Producer that is not cancelable by the Company or such
             Acquired Subsidiary, on notice of not longer than 60 days
             and without any expense, liability, penalty or premium of
             any kind in an amount greater than $25,000, or any
             Contract providing for the payment of any bonus or
             commission based on sales or earnings of any of the
             Acquired Companies; and
   
                  (ii) Neither the Company nor any Acquired Subsidiary
             is subject to any Contract containing covenants limiting
             the freedom of the Company or any Acquired Subsidiary to
             compete in any line of business in any geographic area,
             restricting or requiring any particular sales or other
             office location or requiring the Company to share any
             profits.
   
             (c)  To the best knowledge of the Alexander Hamilton
   Parties, all Contracts referred to, or required to be referred to,
   on any Exhibit delivered hereunder ("Exhibit Contracts") are valid
   and binding, and are in full force and effect and are enforceable
   in accordance with their terms, subject to the effect of any
   bankruptcy, insolvency, moratorium, or other similar laws affecting
   the enforcement of creditors' rights generally and except as the
   availability of equitable remedies may be limited by general
   principles of equity.  Except as described on Exhibit 5.14(b), the
   Alexander Hamilton Parties have no knowledge of any pending or
   threatened bankruptcy, insolvency or similar proceeding with
   respect to any party to such Exhibit Contracts.  Except as
   described on Exhibit 5.14(b), no event has occurred or state of
   facts exists which (whether with or without notice, lapse of time
   or the happening or occurrence of any other event) would constitute
   a default thereunder by the Company or any Acquired Subsidiary or,
   to the best knowledge of the Alexander Hamilton Parties, any other
   party thereto.  Each of the Company and the Acquired Subsidiaries
   has duly complied in all material respects with all provisions of
   every Exhibit Contract to which the Company or such Acquired
   Subsidiary is a party and is not in default as to any such
   Contract. 
   
             (d)  All outstanding insurance Contracts of the Company
   and the Acquired Subsidiaries were issued in conformity with the
   Company's underwriting standards and, with respect to such
   Contracts reinsured in whole or in part, conform to the standards
   agreed to with the reinsurer in the related reinsurance,
   coinsurance or other similar contracts.
   
        SECTION 5.15.  Reinsurance Treaties
   
             Except for the Transferred Business Reinsurance
   Agreements, Exhibit 5.15 lists all of the Reinsurance Treaties.
   Seller has provided to Purchaser copies of the Reinsurance Treaties
   which are true, accurate and complete, including all amendments or
   modifications thereto.  All Reinsurance Agreements are in full
   force and effect, enforceable in accordance with their terms, and,
   except as set forth in Exhibit 5.15, neither the Company nor, to
   the best knowledge of the Alexander Hamilton Parties, any other
   party to the Reinsurance Treaties is in default or alleged to be in
   default under the terms thereof, and there exists no condition
   which, after notice or lapse of time or both, would constitute a
   default thereunder.  Except as provided for in the Statutory
   Financial Statement as of and for the year ended December 31, 1994,
   or as disclosed in Exhibit 5.15 hereto, all reinsurance represented
   by the Reinsurance Treaties represents an admitted asset or
   reduction of loss reserves of the Company or an Acquired Subsidiary
   in the Statutory Statements and their carrying values have been
   described in conformity with Statutory Accounting Principles and in
   accordance with values prescribed by the National Association of
   Insurance Commissioners, when appropriate, consistent with the
   prior reporting practices of the Company and the Acquired
   Subsidiaries.  Except as set forth on Exhibit 5.15, no consent from
   any assuming reinsurer under any of the Reinsurance Treaties is
   required in order for Seller to validly and effectively sell the
   Shares to Purchaser as provided hereunder.  The consummation of the
   transactions contemplated by this Agreement will not affect any
   Acquired Company's rights under the Reinsurance Treaties and
   specifically (i) no Reinsurance Treaties will be terminable nor
   will any commutation or recapture thereunder be required as a
   result thereof and (ii) such consummation will not adversely affect
   an Acquired Company's recapture rights under such Reinsurance
   Treaties.  Recapture rights under the Reinsurance Treaties in
   connection with the increase in retention limits implemented in
   1995 under life insurance contracts are available and have not been
   diminished.
   
        SECTION 5.16.  Employees and Compensation
   
             (a)  Each of the Acquired Companies has complied
   materially with all applicable rules, laws and regulations
   concerning wages, bonuses, discrimination in employment,
   disabilities, family and medical leave, immigration, wrongful
   termination, worker's compensation for injury or sickness,
   collective bargaining, OSHA and other employment matters and made,
   in a timely manner, true, complete and accurate filings (in all
   material respects) required in connection therewith by any federal,
   state, local or Canadian governmental unit or agency.  Other than
   the HI RIP and the HI TRIP, no Acquired Company is liable to any
   former employee for any accrued wages or other benefits except as
   outlined in Section 5.17.  Each of the Acquired Companies has
   complied with all garnishment orders it has received and has made
   available all garnishment orders it has received in the last year
   to Purchaser.  Seller has previously delivered to Purchaser a list
   of all employees of the Acquired Companies whose annual salary is
   in excess of $75,000, including their current salary or rate of
   remuneration, any Contracts between each such employee and any
   Acquired Company and any special benefits or arrangements to which
   they are entitled, including any promised salary, wage or
   commission increase, other than non-qualified pension plans,
   welfare benefit plans or fringe benefits referred to in
   Exhibit 5.17.  Except as set forth in Exhibit 5.16, there are no
   employment Contracts with any employee of the Company or any
   Acquired Subsidiary and the employment of each employee of the
   Acquired Companies is terminable at will by the Acquired Companies
   without restriction, penalty or payment of any kind, other than
   payments with respect to liabilities reflected on the Financial
   Statements and for services actually performed, non-material
   payments for accrued benefits and the severance plan attached as
   Exhibit 8.4.  No employee of any Acquired Company has suffered an
   "employment loss" (as defined in the Worker Adjustment and
   Retraining Notification Act) within the 90 days prior to the date
   hereof or is anticipated to suffer an "employment loss" within the
   90 days prior to the Closing Date.
   
             (b)  Since December 31, 1994 no employee of an Acquired
   Company, or group of employees, the loss of whom would have a
   significant adverse effect on the Business, has notified any
   Acquired Company of his or their intent to (i) terminate his or
   their relationship with the Acquired Companies or (ii) make any
   demand for material payments or modifications of his or their
   arrangements with any Acquired Company.
   
             (c)  Except as set forth in Exhibit 5.16, the employees
   of the Acquired Companies are not represented by a labor
   organization, no Acquired Company is a signatory to a collective
   bargaining agreement with any labor organization, no union claims
   to represent any such employees and no union organizing effort is
   or within the last three years has been underway involving
   employees of any Acquired Company.
   
        SECTION 5.17.  Employee Benefit Plans
   
             (a)  Other than the HI RIP and the HI TRIP, Exhibit 5.17
   sets forth a complete list of each bonus, deferred compensation,
   incentive compensation, stock purchase, stock option, equity-based
   award, severance or termination pay, hospitalization or other
   medical, accident, disability, life or other insurance,
   supplemental unemployment benefits, fringe and other welfare
   benefit, profit-sharing, pension, or retirement plan, program,
   agreement or arrangement, and each other employee benefit plan,
   program, agreement or arrangement, sponsored, maintained or
   contributed to or required to be contributed to by the Acquired
   Companies or by any trade or business, whether or not incorporated,
   that together with the Acquired Companies would be deemed a "single
   employer" within the meaning of section 4001 of ERISA, or
   considered as being members of a controlled group of corporations,
   under common control, or members of an affiliated service group
   within the meaning of subsections 414(b), (c), (m) or (o) of the
   Code or Section 4001(a) (14) of ERISA (each such Subsidiary, trade,
   business or member an "ERISA Affiliate"), in each case for the
   benefit of any employee or former employee of the Acquired
   Companies (the "Benefit Plans").  Seller has previously furnished
   to Purchaser all of the written personnel policies, rules or
   procedures applicable to employees of any Acquired Company.
   
             (b)  Neither the Company nor any Acquired Subsidiary has
   (within the last six years prior to the date hereof) terminated or
   withdrawn from or sought a funding waiver with respect to, and no
   facts exist which could reasonably be expected to result in a
   termination or withdrawal from or seeking a funding waiver with
   respect to, any employee benefit plan which is subject to Title IV
   of ERISA other than the matters described in Exhibit 5.17(b). 
   Neither the Company nor any Acquired Subsidiary has incurred
   liability, and no facts exist which could reasonably be expected to
   result in such liability, as a result of a termination, withdrawal
   or funding waiver with respect to any plan, program or arrangement
   maintained for the benefit of the employees or former employees of
   an ERISA Affiliate (other than a Benefit Plan described in
   Section 5.17(a)) that is subject to Title IV of ERISA (an "ERISA
   Affiliate Title IV Plan").
   
             (c)  Seller has furnished to Purchaser (except as noted
   on Exhibit 5.17(c)) (i) a true, complete and current copy of
   (i) each written Benefit Plan, any amendments thereto and all
   trust, insurance or other funding agreements therefor and (ii) with
   respect to each Benefit Plan, all currently effective IRS,
   Department of Labor or Pension Benefit Guaranty Corporation rulings
   or determinations or rulings or determinations of any foreign
   government or agency, and the most recent annual reports, summary
   plan descriptions, actuarial reports and Statement of Financial
   Accounting Standards Nos. 87, 106 and 112 reports, (iii) a complete
   written description of each other Benefit Plan and (iv) such other
   documentation with respect to any Benefit Plan as has been
   reasonably requested by Purchaser.
   
             (d)  Based on the Towers Perrin report dated April 1995,
   the aggregate present value of the liability to the Company and the
   Acquired Subsidiaries to provide post-retirement medical benefits
   and life benefits is estimated at *CONFIDENTIAL 4* as of January 1,
   1995 and to provide long-term disability benefits to former and
   present employees of the Company and any of the Acquired
   Subsidiaries (and their dependents) is estimated to be
   *CONFIDENTIAL 4*.
   
             (e)  Each Benefit Plan and each ERISA Affiliate Title IV
   Plan has been established, maintained and administered in
   compliance in all material respects with all applicable laws,
   including applicable provisions of the laws of the United States
   and Canada.
   
             (f)  Neither the Company nor any Acquired Subsidiary has
   incurred, and no facts exist which are reasonably likely to result
   in, any liability to the Company or any Acquired Subsidiary for any
   tax or penalty with respect to any Benefit Plan, ERISA Affiliate
   Title IV Plan or any group health plan (as described in section
   5000 of the Code) of an ERISA Affiliate, including without
   limitation, any liability, tax or penalty under ERISA, the Code or
   Canadian law.
   
             (g)  The Company and each Acquired Subsidiary will have
   the right after the Closing Date under the terms of each Benefit
   Plan and under applicable law to terminate such plan or its
   participation in such plan at any time by action of the Company or
   the Acquired Subsidiary, and no additional contributions would be
   required in order to properly effect the termination of such plan
   or its participation in such plan in accordance with the terms of
   such plan and applicable law.
   
             (h)  Except as set forth on Exhibit 5.17(h), the
   consummation of the transactions contemplated by this Agreement
   will not, except as expressly provided in this Agreement, (i)
   entitle any current or former employee, director or officer of any
   Acquired Company to severance pay, unemployment compensation or any
   other payment or (ii) accelerate the time of payment or vesting or
   increase the amount of compensation due any such employee, director
   or officer.
   
             (i)  No Acquired Company makes or has made, nor has or
   has had an obligation to make, nor reimburses or has reimbursed,
   nor has or has had an obligation to reimburse, another employer,
   directly or indirectly, for making, contributions to a
   multiemployer plan as described in Title IV of ERISA.
   
             (j)  The HI RIP and the HI TRIP satisfy the qualification
   requirements of Section 401 (a) of the Code, each plan has received
   a favorable determination with  respect to its qualification under
   Section 401 (a) of the Code and any amendment made with respect to
   each such plan either is subject to such a favorable determination
   letter or a timely application for such a letter is pending with
   the IRS.  No audit or investigation by any domestic or foreign
   governmental or other law enforcement agency is pending or has been
   proposed with respect to either such plan except for the current
   audit of RIP by the U.S. Department of Labor.  No claims have been
   made or threatened by any person or governmental agency with
   respect to either such plan which claim could reasonably be
   expected to result in liability to the Company or an Acquired
   Subsidiary (other than routine and reasonable claims made in the
   ordinary course of plan operations).
   
        SECTION 5.18.  Producers for the Company
   
             (a)  Seller has previously delivered to Purchaser a
   complete and accurate list of the Producers for the Business who
   earned $100,000 or more in commission income from the Company or
   the Acquired Subsidiaries during 1994, including, with respect to
   each of the top 20 Producers, a brief description of the Producer's
   authority and the compensation and other terms of its relationship
   with the Company or the Acquired Subsidiary.  Seller has provided
   to Purchaser true, accurate and complete copies (in all material
   respects) of all agreements with such Producers, including all
   amendments or modifications thereof.
   
             (b)  The Company has previously furnished to Purchaser
   the forms of Contracts that govern the basic relationship between
   any of the Acquired Companies and personal producing general agents
   and agents.  Exhibit 5.18(b) sets forth a list of all other plans,
   programs and practices, whether written or oral, maintained or
   contributed to by the Company or any Acquired Subsidiary in effect
   as of the date hereof which presently provide or are reasonably
   likely to provide in the future benefits or compensation in excess
   of $100,000 to or on behalf of Producers or former Producers of the
   Company or any Acquired Subsidiary (excluding any promotional
   contests for Producers as to which the aggregate amounts payable
   thereunder do not exceed $100,000) ("Producer Plans"), copies of
   which have been previously furnished to Purchaser.  Except as set
   forth on Exhibit 5.18(b), each such Producer Plan may be terminated
   within 90 days of the giving of notice without any liability
   whatsoever to any Person whomsoever except payment to or on behalf
   of any Producers or former Producers (other than commissions
   accrued prior to such termination and vested renewals) of an amount
   less than or equal to $25,000 or, in the aggregate for all such
   Producers or former Producers, of an amount less than or equal to
   $250,000.
   
             (c)  To the best knowledge of the Alexander Hamilton
   Parties, there is no, and since December 31, 1994 there has not
   been any, condition or state of facts (excluding the transactions
   contemplated by this Agreement and external political and economic
   conditions) which is reasonably likely to affect the Company's and
   the Acquired Subsidiaries' relations with the Producers described
   on Exhibit 5.18(a) in a manner which would have a Material Adverse
   Effect, and no Producer or group of Producers, the loss of whom
   would have a Material Adverse Effect, has notified the Company or
   any Acquired Subsidiary since December 31, 1994 of his or their
   intent to (i) terminate his or their relationship with the Company
   or any Acquired Subsidiary or (ii) make any demand for material
   payments or modifications of his or their arrangements with the
   Company or any Acquired Subsidiary.
   
        SECTION 5.19.  Insurance
   
             Exhibit 5.19 contains a true and complete list of all
   policies currently in force relating to liability (including
   professional liability), theft, fidelity, fire and other casualty,
   life, accident and health, workers compensation, and any other form
   of insurance in force naming the Company, any Acquired Subsidiary
   or any employees thereof as an insured or beneficiary or as a loss
   payable payee and for which the Company or any Acquired Subsidiary
   has paid or is obligated to pay all or part of the premiums
   including the following information: (i) the name of the insurer,
   (ii) the amount of coverage and any retention or deductible, (iii)
   type of insurance coverage, (iv) insurance policy number, (v) any
   pending claims thereunder relating to the Company or any Acquired
   Subsidiary whether by the Company or otherwise (and the Company has
   disclosed to Purchaser all significant facts and circumstances
   known to the Alexander Hamilton Parties which may give rise to any
   claim) and (vi) the expiration date.  Except as set forth on
   Exhibit 5.19, neither the Company nor any Acquired Subsidiary has
   received notice of any pending or threatened cancellation or
   premium increase of more than 10% (retroactive or otherwise) with
   respect to any such policies referred to on Exhibit 5.19, and the
   Company and each Acquired Subsidiary is in compliance with all
   conditions contained therein.  The policies listed in Exhibit 5.19
   are in amounts which are adequate with respect to the operation of
   the Acquired Companies through the Closing Date.  Except as set
   forth on Exhibit 5.19, the limits of liability or amount of
   insurance under the policies listed in Exhibit 5.19 is not limited
   or subject to reduction or exhaustion due to claims made by or
   against any Person other than the Company or any Acquired
   Subsidiary.  Except as set forth on Exhibit 5.19, there are no
   pending claims against such insurance by the Company or any of the
   Acquired Subsidiaries as to which insurers are defending under
   reservation of rights or have denied liability, and there exists no
   claim under such insurance that has not been properly filed by the
   Company or the Acquired Subsidiaries.  The Company and each
   Acquired Subsidiary have been and are insured by reputable insurers
   with respect to their properties and the conduct of their business
   in such amounts and against such risks as are reasonable in
   relation to their business, and the Company will use its
   commercially reasonable best efforts to maintain such insurance in
   force at least through the Closing Date.
   
        SECTION 5.20.  Insurance Policy Forms and Rates
   
             Each insurance policy or certificate form, as well as any
   related application form, written advertising material and rate or
   rule currently in use by the Company or any Acquired Subsidiary,
   the use or issuance of which requires filing or approval, has been
   appropriately filed, and if required, approved by the Michigan
   Insurance Department or other applicable regulatory agencies.  All
   such policies and certificates, forms, applications, advertising
   materials and rates or rules are in compliance in all material
   respects with all applicable laws and regulations.
   
        SECTION 5.21.  Litigation and Regulatory Investigations
   
             (a)  The Company has delivered to Purchaser a Litigation
   Memorandum which sets forth all actions, suits, claims,
   investigations, unresolved regulatory inquiries or legal,
   administrative or arbitration proceedings pending or threatened
   which are known to the Alexander Hamilton Parties and which would
   involve a claim for an amount in excess of $100,000 in any single
   instance against or on behalf of the Company or any Acquired
   Subsidiary, or any officer, employee or director thereof in such
   individual's capacity as officer, employee or director of the
   Company or any Acquired Subsidiary or involving any of their
   properties or the Business, whether at law or in equity, before or
   by any federal, state, municipal or other governmental department,
   commission, board, bureau, agency or instrumentality, domestic or
   foreign, or any private party or entity and which indicates which
   of such matters are being defended by an insurance carrier, and
   which of the matters being so defended are being defended under a
   reservation of rights.  None of such matters (singly or in the
   aggregate) could reasonably be expected to result in a Material
   Adverse Effect.  Further, except as set forth in the Litigation
   Memorandum, there are no outstanding judgments, orders, decrees,
   stipulations or awards (whether rendered by a court, administrative
   agency, or by arbitration, pursuant to a grievance or other
   procedures) against or relating to the Company or any Acquired
   Subsidiary which contain any remaining restrictions or obligations
   to perform.  There is no pending or, to the best knowledge of the
   Alexander Hamilton Parties, threatened action, proceeding or
   investigation with respect to the Company, any Acquired Subsidiary
   or any other Person which questions the validity of this Agreement
   or the Transaction Documents or any transaction contemplated hereby
   or thereby, could prevent or materially adversely affect any action
   taken or to be taken pursuant hereto or thereto or which might
   result in any revocation, suspension or limitation of any
   regulatory authority of the Company or any Acquired Subsidiary or
   have a Material Adverse Effect, or which might result in any
   material liability of the Acquired Companies, taken as a whole.
   
             (b)  The Litigation Memorandum described in paragraph (a)
   above sets forth a description of all settlements for any action,
   suit, claim, investigation, regulatory inquiry or legal,
   administrative, arbitration or other proceeding involving any of
   the Acquired Companies during the 24 month period ending June 30,
   1995 and which resulted in a payment in full satisfaction thereof
   of more than $100,000.
   
        SECTION 5.22.  Compliance with Applicable Laws and Regulations
   
             Except as disclosed in Exhibit 5.22, each Acquired
   Company has complied in all material respects with its obligation
   to make each required filing or report with governmental or
   regulatory bodies and complied in all material respects with all
   laws, rules, regulations, licensing requirements and orders
   applicable to the Acquired Companies or the operation of the
   Business, and there has been no assertion by any party responsible
   for the administration or enforcement thereof that the Company or
   its Subsidiaries has violated any such laws, rules, regulations,
   requirements or  orders.  All filings and reports to governmental
   or regulatory authorities have been true, complete and accurate in
   all material respects.
   
        SECTION 5.23.  Brokers' or Finders' Fees
   
             Other than Morgan Stanley & Co. Incorporated (whose fees
   shall be paid solely by Parent), no agent, broker, investment
   banker, Person or firm acting on behalf or under the authority of
   Seller, Parent or its Affiliates or the Company is or will be
   entitled to any brokers' or finder' fee or any other commission or
   similar fee directly or indirectly from Purchaser or any Acquired
   Company in connection with any of the transactions contemplated by
   this Agreement.
   
        SECTION 5.24.  Full Disclosure; No Misrepresentations
   
             (a)  No information contained in the representations and
   warranties of Seller or Parent set forth in this Agreement, the
   Annex or in any of the certificates, schedules, lists, documents,
   exhibits or other instruments relating hereto or to be delivered or
   referenced as having previously been delivered to Purchaser
   hereunder contains any untrue statement of a material fact or omits
   to state a material fact necessary to make the statements contained
   herein or therein, in light of the circumstances under which they
   were made, not misleading.  There is no fact or condition known to
   Parent, Seller or the Company which has not been disclosed to
   Purchaser in writing which materially adversely affects or to the
   knowledge of any of the Alexander Hamilton Parties reasonably may
   be expected to materially adversely affect the business, assets,
   liabilities or financial condition of the Acquired Companies, taken
   as a whole.
   
             (b)  The Alexander Hamilton Parties have provided to
   Purchaser and its representatives certain documentation and
   information described on Exhibit 5.24(b) (the "Evaluation
   Materials").  To the best knowledge of the Alexander Hamilton
   Parties, the statements contained in Exhibit 5.24(b) are true and
   complete in all material respects.
   
        SECTION 5.25.  Dividends; Distributions on the Note
   
             (a)  Since December 31, 1994, other than the dividends
   permitted by this Agreement, the Company has not declared, set
   aside or paid any dividend payable in cash, stock or property or
   made any other distribution with respect to its capital stock. 
   Since December 31, 1994, none of the Company's subsidiaries has
   declared, set aside or paid any dividend payable in cash, stock or
   property or made any other distribution with respect to its capital
   stock.
   
             (b)  Other than the payment to Parent of *CONFIDENTIAL 5*
   in interest on the Note during 1995, the Company has not paid or
   set aside in a reserve any other payment on the Note.
   
        SECTION 5.26.  Property  
   
             (a)  Attached hereto as Exhibit 5.26(a) is a list of all
   the real property that the Company or any of the Acquired
   Subsidiaries will own as of the Closing Date.  As to such real
   property listed,
   
                  (i)  the identified owner has good and marketable
                       title to the parcel of real property, free and
                       clear of any Encumbrances, covenant or other
                       restriction except (A) as noted on the list 
                       therein and (B) for taxes not yet due,
                       recorded easements, covenants and other
                       restrictions, and utility easements, building
                       restrictions, zoning restrictions, and other
                       easements and restrictions existing generally
                       with respect to properties of a similar
                       character;
   
                  (ii) except as disclosed on Exhibit 5.26(a), there
                       are no leases, subleases, licenses,
                       concessions or other agreements granting to
                       any party or parties the right of use or
                       occupancy of any portion or the parcel of real
                       property; and
   
                 (iii) except as disclosed on Exhibit 5.26(a),
                       there are no outstanding options or
                       rights of first refusal to purchase the
                       parcel of real property, or any portion
                       or interest therein.
   
             (b)  The Company and each of its subsidiaries has good
   and marketable title or other rights to possess or use such of its
   personal property as is necessary to conduct its business as
   presently conducted, free and clear of all Encumbrances that could
   reasonably be expected to have a material adverse effect on the
   conduct the business of the Company and its subsidiaries, taken as
   a whole.
   
             (c)  Except with respect to personal property described
   in Section 5.27, all of the personal property necessary for the
   Company and each of its subsidiaries to conduct its business as
   presently conducted is under the possession or control of the
   Company.
   
             (d)  All real property leased by the Company and each of
   its subsidiaries is in good order, condition and repair, and the
   operations conducted on such real property comply with all
   applicable zoning and use restrictions except where the failure to
   be in such good order, condition, and repair, or to comply with
   such restrictions would not materially and adversely affect the
   Company's or its subsidiaries' ability to conduct the Business as
   such business is currently conducted.
   
             (e)  Except as set forth on Exhibit 5.26(e), the book
   value of the personal property (including all improvements on any
   real property owned by the Company or any Acquired Subsidiary and
   excluding all Investments and deposits) and leasehold improvements
   which are not located on the premises of the principal business
   operations of the Company or any Acquired Subsidiary does not
   exceed $250,000 in the aggregate.
   
             (f)  The structures and equipment owned by the Company or
   any Acquired Subsidiary and the structures and equipment leased by
   the Company or any Acquired Subsidiary, are structurally sound with
   no material defects, are in good and safe operating condition and
   repair and are adequate for the uses to which they are being put. 
   
        SECTION 5.27.  Patents and Trademarks; Technology
   
             (a)  Exhibit 5.27(a) sets forth a complete and accurate
   list and description of (i) all material United States and foreign
   patents, trademarks, trade names, service marks, copyrights and
   applications therefor owned by the Company or any Acquired
   Subsidiary (the "Patent and Trademark Rights") and (ii) all
   material United States and foreign patents, trademarks, trade
   names, service marks, copyrights and applications therefor,
   licensed to the Company or any Acquired Subsidiary (the "Licensed
   Rights").  Except as set forth on Exhibit 5.27(a), (i) the Patent
   and Trademark Rights are free of any Encumbrances, are not subject
   to any license (royalty-bearing or royalty-free) and are not
   subject to any other arrangement requiring any payment to any
   Person or the obligation to grant rights to any Person in exchange,
   (ii) the Licensed Rights are free and clear of any liens, claims,
   encumbrances, royalties or other obligations created by the Company
   or any Acquired Subsidiary and (iii) the Patent and Trademark
   Rights and the Licensed Rights are all those rights necessary to
   the Business as currently being conducted.  Except as set forth on
   Exhibit 5.27(a), the validity of the Patent and Trademark Rights
   and the validity of the Licensed Rights (i) have not been
   questioned in any prior litigation, (ii) are not being questioned
   in any pending litigation and (iii) to the best knowledge of the
   Alexander Hamilton Parties, are not the subject(s) of any
   threatened or proposed litigation.  Except as set forth on Exhibit
   5.27(a), the Business, as currently being conducted, does not
   conflict with and has not been alleged to conflict with any
   patents, trademarks, trade names, service marks, or copyright of
   others.  The consummation of the transactions contemplated by this
   Agreement and the Transaction Documents will not result in the loss
   or impairment of any of the Patent and Trademark Rights or any of
   the Licensed Rights or result in any requirement of new or
   additional royalty, licensing fees,  relicensing fees or other
   expenses.  Except as set forth on Exhibit 5.27(a), none of the
   Alexander Hamilton Parties knows of any use by others of the Patent
   and Trademark Rights or the Licensed Rights.
   
             (b)  The Company or an Acquired Subsidiary is the sole
   owner of the Patent and Trademark Rights and neither the Company
   nor any Acquired Subsidiary has previously assigned or granted and
   will not, prior to the Closing, grant to any Person any right,
   title or interest, option, or claim in respect of the Patent and
   Trademark Rights
   
             (c)  Neither the Company nor any Acquired Subsidiary in
   the conduct of the Business as currently conducted, infringes or
   wrongfully uses any confidential information, trade secrets,
   copyrights, letters, patent trade marks, service rights, trade
   names, designs, business names, or similar industrial, commercial
   or intellectual property rights.
   
             (d)  Exhibit 5.27(d) sets forth a list of certain
   computer software that (i) is used in connection with the Business
   (the "Business Software Rights") on the Closing Date, (ii) a subset
   of such Business Software Rights agreed to by the Parties which
   will be obtained for the Acquired Companies for the use with the
   Individual Business on the Conversion Date (the "Relicensed
   Software Rights") or (iii) has been internally created by or for
   the Company or an Acquired Subsidiary and which the Parent
   (including all affiliates thereof) will be granted a nonexclusive
   perpetual royalty-free license to use from Purchaser (the "Owned
   Software").  As of the Closing Date, the Company and each Acquired
   Subsidiary shall have access to and be entitled to use the Business
   Software Rights pursuant to a Computer Services Agreement as set
   forth in Section 7.12.  The Company and the Acquired Subsidiaries
   will possess rights to use all know-how and improvements relating
   to the Relicensed Software Rights ("Software Know-how") (whether
   developed by any of them or Parent or any Affiliate (other than the
   Acquired Companies)).  As of the Conversion Date, Company and each
   Acquired Subsidiary shall possess valid rights to use all
   Relicensed Software Rights, Owned Software or Software Know-how and
   such conversion will not result in the loss or impairment of any
   Relicensed Software Rights, Owned Software or Software Know-how to
   the Acquired Companies.
   
        SECTION 5.28.  Absence of Certain Changes or Events  
   
             Except (i) as set forth on Exhibit 5.28, (ii) for
   Contracts solely between or among the Company and any of the
   Acquired Subsidiaries in the ordinary course of business and
   consistent with past practice or (iii) as contemplated herein or in
   the Transaction Documents, neither the Company nor any of its
   subsidiaries has since December 31, 1994:
   
             (a)  Suffered any change in its financial condition or
   results of operations, policyholders' surplus, assets or
   liabilities, reserves, nature of its business or operations which
   change could reasonably be expected to, individually or in the
   aggregate, have a Material Adverse Effect;
   
             (b)  Incurred any liability or obligation (absolute,
   accrued, contingent or otherwise) except in the ordinary course of
   business and consistent with past practice, or suffered any
   material bad debt, contingency or other reserve increase (except
   insurance reserve increases resulting in the ordinary course of
   business);
   
             (c)  Made, declared or paid any dividend or made any
   distribution or payment, in respect of, or directly or indirectly
   redeemed, purchased or otherwise acquired, any shares of its
   outstanding capital stock, changed the number of shares of its
   authorized or issued capital stock, permitted shares of its capital
   stock held in treasury to become outstanding, or issued any capital
   stock or issued or granted any option, warrant, call, commitment,
   subscription, right to purchase or contract of any character
   relating to its authorized or issued capital stock or any
   securities convertible into, relating to or based on its capital
   stock.
   
             (d)  Paid, discharged or satisfied any claims,
   liabilities or obligations (absolute, accrued, contingent or
   otherwise), other than the payment, discharge or satisfaction in
   the ordinary course of business and consistent with past practice
   of liabilities and obligations reflected or reserved in the
   Statutory Statements or incurred in the ordinary course of business
   and consistent with past practice since December 31, 1994; 
   
             (e)  Permitted or allowed any of its property or assets
   (real, personal or mixed, tangible or intangible) to be subjected
   to any Encumbrance;
   
             (f)  Written off as uncollectible any notes or accounts
   receivable or any portion thereof, except such write-offs in the
   ordinary course of business and consistent with past practice which
   are not in excess of $250,000 in the aggregate;
   
             (g)  Written down the value of any asset or investment on
   its books or records, except for depreciation and amortization
   taken in the ordinary course of business and consistent with past
   practice;
   
             (h)  Canceled any debts or waived any claims or rights in
   excess of $250,000 in the aggregate, or sold, transferred or
   otherwise disposed of any of its properties or assets, except in
   transactions in the ordinary course of business and consistent with
   past practice and except pursuant to existing Reinsurance
   Agreements;
   
             (i)  Made aggregate capital expenditures and commitments
   in excess of $500,000 (on a consolidated basis) for additions to
   property or equipment;
   
             (j)  Paid, loaned or advanced (other than the payment of
   salaries or benefits or reimbursements of expenses in the ordinary
   course of business) any amount to, or sold, transferred or leased
   any properties or assets to, or entered into any Contract with, any
   of its officers or directors,  any Affiliate or associate of any of
   its officers or directors, or either Seller or any Affiliate of
   such Seller;
   
             (k)  Adopted or made any material change in any Benefit
   Plan;
   
             (l)  Taken or failed to take any action with respect to
   any Benefit Plan which would result in a failure to comply with
   applicable law or with Section 401 of the Code to the extent such
   Benefit Plan is intended to satisfy such section;
   
             (m)  Suffered any significant labor controversy or
   deterioration or loss in its agency force;
   
             (n)  Except for customary wage or salary increases for
   employees and  customary compensation increases for Producers,
   increased or announced any increase in the compensation payable or
   to become payable to any employee or Producer or increased or
   announced any increase in any bonus, insurance, pension or other
   Benefit Plan for such employees or Producers or entered into or
   amended any employment, consulting, severance or similar Contract,
   except for (i) at will employment arrangements and (ii) Contracts
   with Producers, in each case entered into or terminated, as the
   case may be, in the ordinary course of business consistent with
   past practice;
   
             (o)  Made any change in any accounting method, practice
   or principle or systems of internal accounting controls, or any
   change in any actuarial or reserving standard or any change in
   depreciation or amortization policies or rates adopted by it;
   
             (p)  Made any change in its underwriting standards,
   retention limits or administrative practices with respect to
   additions to (new business) or deletions from (policy terminations)
   any policy master files;
   
             (q)  Entered into any transaction other than in the
   ordinary course of business;
   
             (r)  Experienced any other event, development or
   condition of any character which has had or is reasonably likely to
   have a Material Adverse Effect; 
   
             (s)  Made any change in crediting rates, except changes
   generally comparable to those made by principal competitors or as
   agreed to by Purchaser; or 
   
             (t)  Agreed, whether in writing or otherwise, to take any
   action described in this Section 5.28.
   
        SECTION 5.29.  Agreement Does Not Violate Other Agreements
   
             Except as set forth on Exhibit 5.29, neither the
   execution, delivery, and performance by Parent, Seller or the
   Company of this Agreement and the Transaction Documents, nor the
   consummation of the transactions contemplated hereby and thereby,
   will (i) violate, conflict with, result in a breach of any
   provision of, constitute a default (or an event that, with notice
   or lapse of time or both, would constitute a default) under, result
   in the termination of, accelerate the performance required by, or
   result in a right of termination or acceleration, or the creation
   of any Encumbrance upon any of the properties or assets of Parent,
   Seller, the Company or any Acquired Subsidiary, under any of the
   terms, conditions, or provisions of (A) the articles of
   incorporation or by-laws of Seller, the Company, Parent or any
   Acquired Subsidiary or any shareholders' agreements relating to
   Parent, Seller, the Company or any Acquired Subsidiary or (B) any
   material commitment, mortgage, note, bond, indenture, contract,
   agreement, license or other instrument or obligation to which
   Seller, the Company, Parent or any of the Acquired Subsidiaries is
   a party, or by which the properties or assets of the Company or any
   of the Acquired Subsidiaries may be bound, except to the extent of
   the approvals described in Section 5.30, (ii) violate or conflict
   with any provision of any order, writ, injunction, statute, law,
   rule, regulation, permit or decree of any court, administrative
   agency or governmental body applicable to the Company or the
   Acquired Subsidiaries or (iii) alter or impair any permits,
   certificates, licenses, approvals and other authorizations required
   by the Company and the Acquired Subsidiaries to conduct the
   Business, except for states in which approval of the state
   insurance regulatory authority is required or in which the
   regulatory authority has discretionary authority to review the
   terms or effect of the transactions contemplated by this Agreement.
   
   
        SECTION 5.30.  Consents and Approvals
   
             Except as required by the HSR Act and other than
   consents, authorizations, approvals, or exemptions required under
   any applicable insurance and insurance holding company system
   statutes, no filing and no permit, authorization, consent or
   approval of any other Person is necessary for the execution and
   delivery of this Agreement and the Transaction Documents by the
   Alexander Hamilton Parties and the consummation by Parent, Seller
   or the Company of the transactions contemplated herein and therein;
   provided, however, that the Parties recognize that a Section 351
   Transaction Structure would require approval under insurance laws
   and regulations of the states in which business is conducted by the
   Company, as well as the regulatory clearances contemplated in
   Section 12.4(m).
   
        SECTION 5.31.  Environmental Matters
   
             Except as set forth on Exhibit 5.31:
   
             (a)  The Company and the Acquired Subsidiaries have
   obtained all permits, licenses and other authorizations and filed
   all notices which are required to be obtained or filed by any
   applicable Environmental Laws.
   
             (b)  To the best knowledge of the Alexander Hamilton
   Parties, the Company and the Acquired Subsidiaries are in
   compliance in all material respects with all terms and conditions
   of such required permits, licenses and authorizations.
   
             (c)  To the best knowledge of the Alexander Hamilton
   Parties, the Company and the Acquired Subsidiaries are in
   compliance in all material respects with all Environmental Laws.
   
             (d)  To the best knowledge of the Alexander Hamilton
   Parties, there are no past or present events, conditions,
   circumstances, activities, practices, incidents, actions or plans
   which may interfere with or prevent continued compliance, or which
   may give rise to any common law or statutory liability, or
   otherwise form the basis of any claim, action, suit, proceeding,
   earning or investigation, based on or related to the manufacture,
   processing, distribution, use, treatment, storage, disposal,
   transport, or handling, or the Release or threatened Release of
   Hazardous Substances with respect to the Company, any Acquired
   Subsidiary, the Business or any property, owned, leased or operated
   by the Company or the Acquired Subsidiaries.
   
             (e)  With regard to any properties owned, leased or
   operated by the Company or the Acquired Subsidiaries, to the best
   knowledge of the Alexander Hamilton Parties:
   
              (i) There has been no Release or threatened Release of
                  Hazardous Substances in violation of Environmental
                  Laws or in quantities that reasonably could result
                  in liability to the Company or the Acquired
                  Subsidiaries.
   
             (ii) They are not subject to a Encumbrance pursuant to
                  Environmental Laws.
   
            (iii) There is not now and has not been, on, in or
                  at such properties, owned or leased by the
                  Company or any Acquired Subsidiary any
                  underground storage tanks; surface
                  impoundment, lagoon or other similar, land-
                  based containment facility for the temporary
                  or permanent storage, treatment or disposal of
                  Hazardous Substances; landfill or solid waste
                  disposal area; polychlorinated biphenyls; or
                  asbestos or asbestos-containing materials. 
   
             (iv) They are in compliance in all material
                  respects with all Environmental Laws.
   
             (f)  The Alexander Hamilton Parties have made available
   to Purchaser all material information known to the Alexander
   Hamilton Parties regarding potential claims against the Company or
   the Acquired Subsidiaries under Environmental Laws with respect to
   the properties underlying mortgage loan Investments and properties
   owned, leased or operated by the Company or the Acquired
   Subsidiaries.
   
             (g)  Neither the Alexander Hamilton Parties nor, to their
   knowledge any past owner, operator, or occupant of the properties,
   now or in the past, owned, leased or operated by the Company and
   the Acquired Subsidiaries has received any claim or notification,
   either direct or indirect, pursuant to Environmental Laws that such
   properties (i) are or may be subject to any investigation or
   evaluation by any Person, (ii) that the Company or the Acquired
   Subsidiaries are or may be liable for cleaning up Hazardous
   Substances on, under, in or migrating from such properties and
   (iii) that Hazardous Substances are or may be migrating onto or
   under such properties.
   
             (h)  The Alexander Hamilton Parties have not received any
   claim or notice, either direct or indirect by a Person asserting
   that the Company or the Acquired Subsidiaries are or may be liable
   for personal injury or property damage arising under Environmental
   Laws.
   
        SECTION 5.32.  Liabilities
   
             Except as and to the extent reflected and adequately
   reserved against in the consolidated balance sheet of the Company
   and its subsidiaries of December 31, 1994 or referenced in any
   other Exhibit hereto, neither the Company nor any of the Acquired
   Subsidiaries has any material liability or obligation (direct or
   indirect, contingent or absolute, asserted or unasserted) of any
   nature other than liabilities or obligations (i) shown on and
   reserved for on the last Financial Statements or notes thereto,
   (ii) incurred by the Company or any of the Acquired Subsidiaries in
   the ordinary course of its business since the most recent Financial
   Statements that has not had and will not have a Material Adverse
   Effect or (iii) incurred in connection with the transactions
   contemplated by this Agreement or otherwise governed by the
   Transaction Documents; provided, however, that this representation
   and warranty shall not extend to any liability arising as a result
   of events or circumstances occurring after the Closing Date or from
   any amendment, modification, interpretation, or other change in any
   statute, regulation, ruling, or accounting standard applicable
   generally to Persons engaged in activities similar to those of the
   Company or the Acquired Subsidiaries.
   
        SECTION 5.33.  Disclaimer
   
             Except as specifically set forth herein, Seller and
   Parent make no other representation or warranty, express or
   implied, as to the Acquired Companies' financial condition,
   business, assets, liabilities, operations, or prospects, and no
   Person has been authorized by Seller or Parent to make any
   representation or warranty except as specifically set forth in this
   Agreement.
   
        SECTION 5.34.  Related Party Agreements
   
             Except for the Note, and the Contracts, Tax sharing
   agreements, and affiliated investments and commitments (together
   the "Intercompany Agreements") listed on Exhibit 5.34 and except
   for agreements solely between or among the Company and the Acquired
   Subsidiaries, there are no outstanding Contracts between Parent,
   Seller or any of their Affiliates, on the one hand, and the Company
   or any Acquired Subsidiary, on the other hand, and none of Parent,
   Seller or any of their Affiliates nor any officer or director
   thereof has any other claim, cause of action or rights (whether
   contractual or otherwise) against the Company or any Acquired
   Subsidiary or any predecessor in interest, other than as
   contemplated by this Agreement.  Except as set forth on
   Exhibit 5.34, there are no Contracts of the Company or any Acquired
   Subsidiary with any director or officer of Parent, any Affiliate of
   Parent, the Company or any Acquired Subsidiary, or with any Person
   related to any such Person or with any company or other
   organization in which any director or officer of Parent, any
   Affiliate of Parent, the Company or any Acquired Subsidiary, or
   anyone related to any Person, has a direct or indirect financial
   interest.
   
        SECTION 5.35.  Policy Information
   
             The information furnished to Purchaser and its
   representatives as set forth in Exhibit 5.35 is accurate in all
   material respects.
   
        SECTION 5.36.  COLI Agreements
   
             Exhibit 5.36 lists all of the Contracts issued or to be
   issued by the COLI Business, and the Company previously has
   delivered to Purchaser copies of all such Contracts, including all
   outstanding agreements, undertakings, commitments or obligations to
   provide insurance, whether or not in the ordinary course of
   business.
   
        SECTION 5.37.  Certain Business Practices
   
             Except as set forth on Exhibit 5.37:
   
             (a)  All insurance or annuity benefits that have become
   payable and not subject to a bona fide dispute by the Company or
   any Acquired Subsidiary, and are not in the course of settlement in
   good faith by such Person, have been paid, or provided for, in
   accordance with the terms of the insurance, annuity or other
   similar contract or agreement under which they arose;
   
             (b)  No outstanding insurance policy or annuity contract
   issued, reinsured or underwritten by the Company or any Acquired
   Subsidiary entitles any Person to receive dividends, distributions
   or other benefits based on the revenues or earnings of the contract
   issuer; 
   
             (c)  The underwriting standards utilized and ratings
   applied by the Company or any Acquired Subsidiary with regard to
   insurance products currently offered by such Person conform in all
   material respects to industry accepted practices; and
   
             (d)  No Producer currently has, and no Producer has had
   in the past, any authority to make underwriting decisions with
   respect to insurance policies issued by the Company or any Acquired
   Subsidiary, as the case may be.
   
   
                              ARTICLE VI.
              REPRESENTATIONS AND WARRANTIES OF PURCHASER
   
        Purchaser hereby represents and warrants to Seller and Parent
   as follows:
   
        SECTION 6.1.  Organization and Standing  
   
             Purchaser is a corporation duly incorporated, validly
   existing and in good standing under the laws of the State of North
   Carolina.
   
        SECTION 6.2.  Authority  
   
             Except for any regulatory or governmental consents that
   may be required, Purchaser has all necessary corporate power and
   authority to enter into this Agreement and all other agreements
   contemplated hereunder and to perform the obligations to be
   performed by it hereunder and thereunder.  The execution and
   delivery of this Agreement and the purchase and other obligations
   contemplated hereby have been duly authorized by all requisite
   corporate action of Purchaser.  This Agreement has been, and any
   other agreements executed by Purchaser pursuant to this Agreement
   will on the Closing Date be, duly executed and delivered by
   Purchaser and constitute valid and binding obligations of
   Purchaser, enforceable against Purchaser in accordance with the
   terms hereof and thereof, subject, as to enforceability of
   remedies, to applicable bankruptcy, insolvency, reorganization,
   moratorium and similar laws of general applicability relating to or
   affecting creditors' rights and to general principles of equity.
   
        SECTION 6.3.  Investment Representation  
   
             Purchaser acknowledges that the Shares and the Note are
   not registered under the securities laws of any jurisdiction and
   that it is acquiring the Shares and the Note for its own account,
   and not with a view to the distribution thereof.  Purchaser is a
   sophisticated investor with knowledge and experience in financial
   matters and has received information from Seller concerning the
   Company and has had the opportunity to obtain additional
   information in order to evaluate the purchase contemplated hereby. 
   Purchaser is purchasing the Shares and the Note for investment
   purposes and not with the intention of reselling or distributing
   the Shares; provided, however, that the foregoing representation
   shall in no way limit Purchaser's right to dispose of all or any
   portion of the Shares or the Note, at any time, at Purchaser's sole
   discretion.
   
        SECTION 6.4.  Consents and Approvals  
   
             Except as set forth on Exhibit 6.4 and as required by the
   HSR Act and other than consents, authorizations, approvals, or
   exemptions required under any applicable insurance holding company
   system statutes in the States of Arizona, Michigan, New York and
   North Carolina, no filing and no permit, authorization, consent or
   approval of any other Person is necessary for the execution and
   delivery of this Agreement and the Transaction Documents by
   Purchaser and the consummation by Purchaser of the transactions
   contemplated herein and therein.
   
        SECTION 6.5.  No Conflict or Violation  
   
             The execution, delivery and performance by Purchaser of
   this Agreement and the Transaction Documents and the consummation
   of the transactions contemplated hereby and thereby will not (i)
   violate, conflict with, result in a breach of any provision of,
   constitute a default (or an event that, with notice or lapse of
   time or both, would constitute a default), result in the
   termination of, accelerate the performance required by, or result
   in a right of termination or acceleration, or the creation of any
   Encumbrance upon any of the properties or assets of Purchaser,
   under any of the terms, conditions or provisions of (A) the
   articles of incorporation or by-laws of Purchaser or any
   shareholders' agreements relating to Purchaser or (B) any material
   commitment, mortgage, note, bond, indenture, contract, agreement,
   license or other instrument or obligation to which Purchaser is a
   party, or by which Purchaser may be bound, (ii) violate or conflict
   with any provision of any order, writ, injunction, statute, law,
   rule, regulation, permit or decree of any court, administrative
   agency or governmental body applicable to Purchaser or (iii) alter
   or impair any permits, certificates, licenses, approvals and other
   authorizations required by Purchaser to conduct the Business,
   except for states in which approval from the state insurance
   regulatory authority is required or in which the regulatory
   authority has discretionary authority to review the terms or effect
   of the transactions contemplated by this Agreement.
   
        SECTION 6.6.  Financial Ability  
   
             Purchaser is financially capable and has sufficient cash
   and other resources available to complete the transactions
   contemplated by this Agreement.
   
        SECTION 6.7.  Litigation  
   
             There are no claims, actions, suits, proceedings or
   investigations pending, or to the knowledge of any executive
   officer of Purchaser, threatened or contemplated, against or
   affecting Purchaser or any of its property or other rights which
   would impair in any manner the ability of Purchaser to perform its
   obligations hereunder, or against the transactions contemplated by
   this Agreement, at law or in equity, before any court or other
   governmental agency or instrumentality, domestic or foreign, or any
   other body, and to the knowledge of any executive officer of
   Purchaser, there is no basis for any such claim, action, suit,
   proceeding or investigation, including without limitation, any such
   claim, action, suit, proceeding or investigation relating to,
   arising out of, or based upon any proceedings by an insurance
   regulatory authority.
   
        SECTION 6.8.  Brokers  
   
             Other than Goldman, Sachs & Co. (whose fees shall be paid
   solely by Purchaser),  no broker, agent, investment banker, Person
   or firm acting on behalf or under the authority of Purchaser or its
   Affiliates is or will be entitled to any brokers' or finder fee or
   any commission or similar fee directly or indirectly from any
   Alexander Hamilton Party in connection with any of  the
   transactions contemplated by this Agreement.
   
   
                             ARTICLE VII.
                 CONDUCT AND TRANSACTIONS PRIOR TO THE
   CLOSING DATE; CERTAIN COVENANTS
   
             The Alexander Hamilton Parties covenant that between the
   date of this Agreement and the Closing Date:
   
        SECTION 7.1.  Maintenance of Business; Certain Transactions
   
             Except to the extent that Purchaser shall otherwise
   consent in writing and except as contemplated by this Agreement,
   the Company and its subsidiaries will operate the Business as
   currently conducted and only in the ordinary course.  In addition,
   Sellers and the Company agree that from the date hereof to the
   Closing Date, and except as expressly authorized under this
   Agreement and the Transaction Documents or as otherwise consented
   to by Purchaser in writing, neither the Company nor any of its
   subsidiaries will:
   
             (a)  Take any action which would result in any
   representation or warranty contained in Article V no longer being
   true and correct in all material respects as if such
   representations or warranty were made on the date thereof;
   
             (b)  Enter into or amend in any material respect any
   Contract (other than insurance Contracts in the ordinary course of
   business consistent with past practice) involving more than
   $100,000 over its noncancellable term or enter into any Contract
   (other than insurance Contracts in the ordinary course of business
   consistent with past practice) involving an amount in excess of
   $100,000 which is not cancelable on 30 days' notice without
   penalty;
   
             (c)  Other than in the ordinary course or to protect the
   business, enter into or amend or cancel or agree to the amendment
   or cancellation of any insurance Contract or other agreement or
   undertaking relating to the COLI Business;
   
             (d)  Issue any periodic payment annuities in respect of
   lotteries or structured settlements;
   
             (e)  Take any action to amend or terminate any Benefit
   Plan or adopt any other plan, program, Contract or practice
   providing benefits for or compensation to or on behalf of employees
   or former employees of the Company or any Acquired Subsidiary, or
   permit any Affiliate of the Company to take any such action if such
   action could subject the Company or any Acquired Subsidiary to an
   obligation or liability in excess of $10,000 with respect to an
   individual employee or former employee or $100,000 in the
   aggregate;
   
             (f)  Change any provision of its articles of
   incorporation or by-laws or similar governing documents;
   
             (g)  Make, declare or pay any dividend or make any
   distribution or payment in respect of or directly or indirectly
   redeem, purchase or otherwise acquire, any shares of its
   outstanding capital stock or the Note, change the number of shares
   of its authorized or issued capital stock, permit any shares of its
   capital stock held in treasury to become outstanding, or issue any
   capital stock or issue or grant any option, warrant, call,
   commitment, subscription, right to purchase or Contract of any
   character relating to its authorized or issued capital stock or any
   securities convertible into, relating to or based on shares of such
   stock; 
   
             (h)  Other than in connection with the development and
   marketing of the insurance product to be sold under the name
   "Allegiance Variable Annuity," undertake any other new product
   introduction;
   
             (i)  Except in the ordinary course of business, make any
   loans or advances to any other Person; 
   
             (j)  Pay, discharge or satisfy any claims, liabilities or
   obligations (absolute, accrued, contingent or otherwise), other
   than payments in the ordinary course of business consistent with
   past practice;
   
             (k)  Purchase, sell or distribute any real or personal
   property or purchase or sell any options to purchase or sell any
   real or personal property, with a market value in excess of
   $100,000 in the aggregate; 
   
             (l)  Permit any insurance policy naming it as a
   beneficiary or a loss payable payee to be canceled or terminated or
   any of the coverage thereunder to lapse unless (i) simultaneously
   with such termination or cancellation substantially similar
   replacement policies reasonably satisfactory to Purchaser are in
   full force and effect or (ii) the cost of renewal is commercially
   unreasonable;
   
             (m)  Enter into or amend or cancel or agree to the
   amendment or cancellation of any reinsurance agreement, treaty or
   arrangement;
   
             (n)  Make any investment of a capital nature either by
   purchase of stock or securities, contributions to capital, property
   transfers or otherwise, or by the purchase of any property or
   assets of any other individual, firm or corporation, except for
   portfolio transactions and Investments in the ordinary course of
   business consistent with past practice;
   
             (o)  Engage in any other transaction or series of related
   transactions (not otherwise referred to in this Section 7.1)
   involving an amount in excess of $100,000;
   
             (p)  Amend or agree to the amendment of any form of
   Producer Contract that is provided on Exhibit 5.18(b) hereof; or
   
             (q)  Enter into a Contract to do any of the things
   described in clauses (a) through (p) above.
   
        SECTION 7.2.  Reports
   
             The Company shall from time to time furnish to Purchaser,
   promptly following the receipt by senior management of the Company,
   (i) copies of all monthly management reports prepared for senior
   management of the Company, (ii) copies of all monthly financial
   statements and reports, (iii) monthly updates of Exhibit 5.10 and
   (iv) a copy of any report filed with any insurance regulatory
   authority, which in each such case, shall be prepared in a manner
   consistent with past practice.
   
        SECTION 7.3.  Corporate Existence
   
             (a)  Except as provided by this Agreement, the Company
   and each of its subsidiaries will use best efforts to preserve its
   respective business organization and goodwill intact, preserve and
   maintain its licenses, keep available the services of its current
   officers and key employees, and maintain satisfactory relationships
   with Producers, licensors, licensees, agents, suppliers,
   contractors, regulators, distributors, policyholders, customers and
   others with whom business relationships exist with the Company or
   such Subsidiary.
   
             (b)  The Company and each of its Subsidiaries will 
   
                  (i)  maintain its respective corporate existence; 
   
                  (ii) pay or reserve all Taxes, charges and
             assessments as reflected on any government filing on a
             timely basis unless the same are being contested and
             adequate reserves therefor have been established on the
             Company's or such subsidiary's books; 
   
                 (iii) make all debt service payments when
             contractually due and payable; and 
   
                  (iv) pay all accounts payable and other liabilities
             on a timely basis.
   
        SECTION 7.4.  Twindex Policies
   
             If requested by Purchaser and agreed by Seller, on or
   before the Closing Date, the Alexander Hamilton Parties will
   provide notice to all holders of Twindex Policies of an amendment
   of the existing reference rate provisions mutually agreeable to
   Purchaser, on the one hand, and the Alexander Hamilton Parties, on
   the other hand.
   
        SECTION 7.5.  Further Assurances
   
             Subject to the terms and conditions of this Agreement,
   the Alexander Hamilton Parties will use all reasonable efforts to
   take, or cause to be taken, all action, and to do, or cause to be
   done, all things reasonably necessary, proper, or advisable under
   applicable laws and regulations to consummate the transactions
   contemplated by this Agreement and to make effective the sale of
   the Shares and the Note pursuant to this Agreement.  From time to
   time after the Closing Date, without further consideration, the
   Alexander Hamilton Parties shall, at their own expense, execute and
   deliver such documents to Purchaser as Purchaser may reasonably
   request in order more effectively to vest in Purchaser good title
   to the Shares and the Note.
   
        SECTION 7.6.  Access
   
             The Alexander Hamilton Parties shall give to Purchaser
   and its accountants, actuaries, counsel and other representatives
   reasonable access throughout the period prior to the Closing Date
   to all of the properties, books, Contracts, commitments and records
   (including Tax Returns and insurance policies) of the Company and
   the Acquired Subsidiaries in order that Purchaser may have
   opportunity to make such investigations as it shall desire in
   conjunction with the transactions contemplated hereunder.  During
   such period, the Alexander Hamilton Parties shall permit Purchaser
   and its representatives to consult with the respective directors,
   officers, employees, auditors, actuaries, attorneys and agents of
   the Company and the Acquired Subsidiaries and, to the extent
   available, the Alexander Hamilton Parties will authorize and direct
   their respective officers, accountants and actuaries to furnish
   such additional financial and operating data and other information
   (including financial statements and other information and consents
   required in connection with any registration statement that may be
   filed by Purchaser which is required to include financial
   information concerning the Acquired Companies) as Purchaser shall
   from time to time reasonably request.
   
        SECTION 7.7.  Consents
   
             Seller, Parent and the Company will use their best
   efforts to obtain all consents of, and provide all notices to,
   other Persons required for Seller, Parent or the Company to
   authorize, approve or permit the sale of  the Shares and the Note
   and the consummation of the transactions contemplated by this
   Agreement and the Transaction Documents, if any such consents or
   notices are required.  Without limiting the generality of the
   foregoing, Seller and the Company shall use their best efforts to
   satisfy or cause to be satisfied all the conditions to the
   obligations of Seller set forth in Sections 9.1 and 9.3.
   
        SECTION   Notification of Certain Matters
   
             Seller, Parent and the Company shall give prompt notice
   to Purchaser of (i) the occurrence, or failure to occur, of any
   event which occurrence or failure would be likely to cause any
   representation or warranty contained in this Agreement to be untrue
   or inaccurate at any time from the date of this Agreement to the
   Closing Date and (ii) any material failure of Seller or Parent to
   comply with or satisfy any covenant, condition or agreement to be
   complied with or satisfied by it hereunder.
   
        SECTION 7.9.  Performance
   
             (i)  Seller and Parent shall perform all acts to be
   performed by it prior to the Closing pursuant to this Agreement and
   shall refrain from taking or omitting to take any action that would
   violate Seller's or Parent's representations and warranties
   hereunder in any material respect or render such representations
   and warranties inaccurate in any material respect as of the date of
   this Agreement or the Closing Date or that in any way would prevent
   or impede the consummation of the transactions contemplated hereby.
   
             (ii) *CONFIDENTIAL 6*
   
        SECTION 7.10.  Negotiations
   
             From the date hereof to the termination of this Agreement
   in accordance with Article X, neither Sellers, the Company, or any
   Affiliate of such Persons shall take any action or authorize or
   permit any of their officers, directors or employees or any
   investment banker, attorney, accountant or other representative
   retained by them to take any action (i) to solicit or encourage,
   directly or indirectly (including by way of furnishing any
   information), any inquiries or the making of any proposal which
   could reasonably be expected to lead to any acquisition proposal
   relating to the Company or any Acquired Subsidiary, (ii) to engage
   in any negotiations with respect to an acquisition proposal, (iii)
   to provide any non-public information concerning the Company or any
   Acquired Subsidiary to any Person in connection with any
   acquisition proposal or (iv) to reach any agreement or
   understanding for any acquisition proposal.  Sellers will promptly
   advise Purchaser orally and in writing of any such inquiries or
   proposals of which the Alexander Hamilton Parties become aware.  As
   used in this Agreement, "acquisition proposal" shall mean any
   proposal for a merger, acquisition of all of the stock or assets
   of, or other business combination involving the Company or any
   Acquired Subsidiary or the acquisition of a substantial equity
   interest in any of them, or a substantial portion of the assets of
   any of them other than the transactions contemplated hereunder.
   
        SECTION 7.11.  Tax Basis
   
             At or prior to the Closing, the Alexander Hamilton
   Parties shall deliver to Purchaser a list setting forth as of the
   last date on which such information is available (but not prior to
   December 31, 1994) the adjusted basis of the depreciable or
   amortizable assets of the Company and the Acquired Subsidiaries for
   all Tax Returns for which such information is available and showing
   the original tax cost of the assets and the tax depreciation or
   amortization thereon.
   
        SECTION 7.12.  Computer Services and Software
   
             (a)  On or before the Closing Date, Parent, for itself
   and on behalf of its Affiliates, shall enter into a computer
   services agreement with the Company (the "Computer Services
   Agreement") and shall cause the Information Technology Services
   Agreement between the Company and an Affiliate of Parent to be
   terminated without any cost or expense to the Acquired Companies. 
   The Computer Services Agreement shall obligate Parent and its
   Affiliates to provide certain processing, software, network and
   other computer services (as identified in the Computer Services
   Agreement) to the Acquired Companies.  In addition, the Computer
   Services Agreement shall require the employees of Parent and any
   Affiliate to provide reasonable assistance to the Purchaser to
   ultimately integrate the Relicensed Software Rights and Owned
   Software into Purchaser's operations in support of the Acquired
   Companies as specified in the Computer Services Agreement.  The
   obligations of the Parties described in the foregoing sentence
   shall have a term of 12 months from the Closing Date (subject to
   earlier termination at the sole option of Purchaser upon 90 days
   prior written notice, with the termination date of the Computer
   Services Agreement being deemed the "Conversion Date"), and the
   Computer Services Agreement will provide, as compensation
   thereunder, that Parent will be entitled to receive from Purchaser
   reimbursement for costs reasonably related to providing such
   services.
   
             (b)  On or before the Closing Date, Parent shall obtain
   all necessary consents or licenses required for Parent to perform
   under the Computer Services Agreement and utilize the Business
   Software Rights for the benefit of the Acquired Companies.  All
   fees and expenses for obtaining any licenses or consents required
   for the use of the Business Software Rights for the benefit of the
   Acquired Companies to the Conversion Date shall be paid by
   *CONFIDENTIAL 7*.  Parent is required to maintain such licenses for
   the benefit of the Acquired Companies only as long as the Computer
   Services Agreement is in effect.
   
             (c)  Prior to the Conversion Date, Parent and Purchaser
   shall cooperate to obtain any license required for the Acquired
   Companies to use the Relicensed Software Rights and Owned Software
   after the Conversion Date.  All one time license fees required to
   be paid for the licenses as set forth herein shall be paid by
   *CONFIDENTIAL 7*.  The Company shall be responsible for all ongoing
   annual fees after the Conversion Date.
   
        SECTION 7.13.  Business Transfer
   
             Subject to receipt of appropriate regulatory approvals,
   immediately prior to the Closing Date, Parent shall cause to be
   effected (i) the transfer of the Affiliated Business Assets and the
   reinsurance of the Affiliated Business Liabilities by the Retained
   Subsidiaries on the terms described on Annex A, (ii) the transfer
   of the COLI Business Assets and the reinsurance of the COLI
   Business Liabilities by the Retained Subsidiaries on the terms
   described in Annex B and (iii) the transfer of the PPA Business
   Assets and the reinsurance of the PPA Business Liabilities by the
   PPA Companies on the terms described in Annex C.
   
        SECTION 7.14.  Non-Solicitation
   
             For a period of *CONFIDENTIAL 8* years following the
   Closing Date, Sellers agree that, without the prior written consent
   of Purchaser, neither of Sellers nor any of their Affiliates will
   hire, or solicit to hire, any Producers, officers, directors or
   other employees of the Company and the Acquired Subsidiaries;
   provided that Sellers shall not be prohibited from hiring or
   soliciting to hire (i) individuals who have provided their
   resignations to Purchaser pursuant to Section 3.2(f),
   (ii) individuals who were employed in the Affiliated Business, the
   COLI Business or the PPA Business as of the Closing Date and were
   not expressly retained by an Acquired Company after the Closing
   Date, (iii) individuals whose employment is terminated by the
   Company after the Closing Date and (iv) any clerical or other
   individuals not comprising senior management who respond to any
   general solicitation.
   
        SECTION 7.15.  *CONFIDENTIAL 9*
   
        SECTION 7.16.  Cross-Defaults
   
             *CONFIDENTIAL 10* 
   
        SECTION 7.17.  Payments on the Note; Other Dividends
   
             (a)  *CONFIDENTIAL 11* 
   
             (b)  *CONFIDENTIAL 11*  
   
        SECTION 7.18.  Name Change
   
             Following the Closing Date, and in no event later than
   one year following the Closing Date, Seller shall change the
   corporate names of Alexander Hamilton Life Insurance Company of
   Arizona, Alexander Hamilton Insurance Agency, Inc., Hamilton
   National Life Insurance Company and Alexander Hamilton Insurance
   Company of America, to one that does not include the words
   "Alexander Hamilton" or "Hamilton" or any other words confusingly
   similar thereto and will make all necessary filings to record such
   name change.
   
        SECTION 7.19.  Delivery of Additional Financial Statements
   
             At Purchaser's request, the Company will cooperate on a
   timely
   basis with Purchaser in the preparation of all financial statements
   required to meet Purchaser's SEC reporting requirements and will be
   reimbursed for any incremental direct costs, except those
   associated with the statements contemplated in Section 5.9.
   
        SECTION 7.20.  Administrative Services
   
             Purchaser and Sellers agree that on or prior to the
   Closing Date they will enter into an agreement (the "Administrative
   Services Agreement") on mutually acceptable terms for Purchaser to
   provide administrative services for the PPA Business, the COLI
   Business and the Affiliated Businesses, pursuant to which Purchaser
   will be entitled to receive reimbursement for costs reasonably
   related to providing such service.
   
   
                             ARTICLE VIII.
                        COVENANTS OF PURCHASER
   
             Purchaser covenants and agrees that between the date of
   this Agreement and the Closing Date:
   
        SECTION 8.1.  Performance
   
             Purchaser shall perform all acts to be performed by it
   prior to the Closing pursuant to this Agreement and shall refrain
   from taking or omitting to take any action that would violate
   Purchaser's representations and warranties hereunder in any
   material respect or render such representations and warranties
   inaccurate in any material respect as of the date of this Agreement
   or the Closing Date or that in any way would prevent or impede the
   consummation of the transactions contemplated hereby.
   
        SECTION 8.2.  Further Assurances
   
             Subject to the terms and conditions of this Agreement,
   Purchaser shall use all reasonable efforts to take, or cause to be
   taken, all action, and to do, or cause to be done, all things
   reasonably necessary, proper, or advisable under applicable laws
   and regulations to consummate the transactions contemplated by this
   Agreement and to make effective the sale of the Shares and the Note
   pursuant to this Agreement.
   
        SECTION 8.3.  Consents and Notices
   
             Purchaser shall use its best efforts to obtain all
   consents of, and provide all notices to, other Persons reasonably
   required for Purchaser to consummate the transactions contemplated
   hereby and by the Transaction Documents, if any such consents or
   notices are required.  Without limiting the generality of the
   foregoing, Purchaser shall use its best efforts to satisfy or cause
   to be satisfied all the conditions to the obligations of Seller set
   forth in Sections 9.1 and 9.2.  Purchaser shall use its best
   efforts to make within 45 days following the date hereof all
   initial filings required to be made by it relating to its
   acquisition of control of the Company and the Acquired
   Subsidiaries, including all filings believed by it to be required
   to be made with state insurance regulatory officials.  Purchaser
   shall respond promptly to each request for further information or
   documentation from regulatory officials and shall provide, where
   practicable, Seller with prior notice of, and shall seek to obtain
   for Seller the opportunity to participate in, all material
   telephone conferences and meetings with regulatory officials
   concerning the transactions contemplated hereby.  Purchaser shall
   provide Seller with a copy of, and the opportunity to comment on,
   all filings and material correspondence with regulatory officials
   within one Business Day prior to its filing with and delivery to
   such officials, and shall provide Seller with a copy of all
   correspondence or notices from regulatory officials within one
   Business Day following receipt by Purchaser.
   
        SECTION 8.4.  Employee Benefit Plans
   
             (a)  Effective as of the Closing Date (or such other
   administratively convenient date mutually determined by Parent and
   Purchaser), Purchaser shall amend one or more of its previously
   adopted defined benefit plans or shall adopt (or shall cause the
   Company to adopt) one or more defined benefit plans for the benefit
   of employees and former employees of the Acquired Companies
   (including their surviving spouses and other beneficiaries) who
   immediately prior to the Closing Date were participants in the HI
   RIP, other than employees of the Retained Subsidiaries and the PPA
   Companies.  For purposes of Sections 8.4, 8.5, 8.6 and 8.7 hereof,
   "former employees" of the Acquired Companies shall be determined as
   of the Closing Date and shall not include any employees of the
   Retained Subsidiaries or the PPA Companies.  Such individuals
   covered by such plan or plans maintained by Purchaser (or by the
   Company) hereunder shall be known as the "Covered Employees."  Such
   plan(s) shall be tax-qualified under Section 401(a) of the Code. 
   Effective as of the Closing Date (or such other administratively
   convenient date determined by Parent and Purchaser), each Covered
   Employee shall have an accrued benefit under the plan(s) maintained
   by Purchaser (or by the Company) pursuant to this Section 8.4 that
   is no less than the accrued benefit that he or she had under the HI
   RIP as of the date immediately prior to the Closing Date.  The term
   "accrued benefit" for this purpose shall include any optional forms
   of accrued benefits and other rights within the scope of
   Section 411(d)(6) of the Code.  Effective as of the date
   immediately prior to the Closing Date, benefits on behalf of
   Covered Employees shall cease to accrue under the HI RIP.  The sum
   of the assets properly allocated to the accrued benefits of each
   Covered Employee *CONFIDENTIAL 12* in the HI RIP, shall be
   transferred in conformity with the requirements of Section 414 of
   the Code in cash, or in kind if such assets are satisfactory to
   Purchaser, from the trust under the HI RIP to the separate account,
   trust or other funding vehicle under Purchaser's (or the Company's)
   Benefit Plan(s) on a date that is mutually agreeable to Parent and
   Purchaser, which shall be no later than the last day of the 12th
   month following the Closing Date and at least 30 days after filing
   the appropriate notices with the IRS.  The total amount of assets
   to be transferred shall be a percentage of the total fair market
   value of the assets held under the HI RIP as of the end of the
   month preceding the month in which the transfer occurs, with the
   percentage determined as follows.  Parent shall cause to be made a
   calculation of benefits on an *CONFIDENTIAL 13* basis as of
   January 1, 1995 for the Covered Employees, based on the methodology
   and assumptions used in Parent's actuarial report from Towers
   Perrin dated March 1995.  The total *CONFIDENTIAL 13* for the
   HI RIP as of January 1, 1995 as presented in the Towers Perrin
   report, and the *CONFIDENTIAL 13* for the Covered Employees as of
   January 1, 1995, each shall be rolled forward to the Closing Date
   to reflect the actual benefit payments, current pension cost
   accruals and the *CONFIDENTIAL 13* assumed earnings rate through
   such date.  The percentage of assets transferred shall be the
   percentage that the *CONFIDENTIAL 13* for Covered Employees
   represents of the total *CONFIDENTIAL 13* for the HI RIP.  Upon
   such transfer, but subject to the obligation to reconcile errors,
   neither Parent nor any Affiliate shall have any liability to the
   Covered Employees for benefits accrued under the HI RIP prior to
   the Closing Date and no further funding obligation in respect of
   such benefits.  Prior to the date of such transfer, Purchaser shall
   furnish Parent the following, to the extent applicable:  (i) at
   Parent's request, copies of Purchaser's (or the Company's) benefit
   plan(s) contemplated herein and the funding agreements thereunder,
   together with any amendments thereof, (ii) copies of the most
   recent determination letter(s) issued by the IRS with respect to
   the qualification under Section 401(a) of the Code of Purchaser's
   (or the Company's) plan(s) contemplated herein, (iii) copies of any
   applications for determination with respect to such plan(s) and as
   to which determination letters have not yet been received, (iv) if
   no determination letter(s) have yet been received with respect to
   the initial qualification of Purchaser's (or the Company's) plan(s)
   contemplated herein, or if such plan(s) have been amended since the
   date of the last determination letter(s), a letter from counsel to
   Purchaser, satisfactory to Parent, that provides that the plan(s)
   (or plan(s), as amended) are intended to satisfy the qualification
   requirements of Section 401(a) of the Code and that Purchaser will
   timely make (or cause the Company to make) such amendments as may
   be required by the Internal Revenue Service to receive the
   determination letter(s) and (v) evidence satisfactory to Parent
   that Purchaser (or the Company's) plan(s) contain language
   providing for the receipt of the transferred assets as provided
   herein.  The obligation to provide benefits that accrued prior to
   the Closing Date in the case of any Covered Employee whose
   employment was terminated prior to the date of the transfer of
   assets contemplated herein shall remain that of the HI RIP until
   such transfer of assets; provided, however, that any payments made
   in the interim from the HI RIP shall be a credit to the total
   amount of assets to be transferred as provided herein.  The Parties
   shall cooperate in giving any appropriate notices to employees and
   former employees and to governmental agencies.
   
             (b)  Effective as of the Closing Date (or such other
   administratively convenient date mutually determined by Parent and
   Purchaser), Purchaser shall amend one or more of its previously
   adopted profit sharing or stock bonus plans or shall adopt (or
   shall cause the Company to adopt) one or more profit sharing or
   stock bonus plans for the benefit of employees and former employees
   of the Acquired Companies (including their surviving spouses and
   other beneficiaries) who immediately prior to the Closing Date were
   participants in the HI TRIP, other than employees of the Retained
   Subsidiaries and the PPA Companies (and their surviving spouses and
   other beneficiaries).  Such individuals covered by such plan or
   plans maintained by Purchaser (or by the Company) as contemplated
   hereunder shall be known as the "TRIP Eligible Employees."  Such
   plan(s) shall (i) be tax-qualified under Section 401(a) of the
   Code, (ii) contain a qualified cash or deferred arrangement under
   Section 401(k) of the Code and (iii) preserve all optional forms of
   benefits and other rights within the scope of Section 411(d)(6) of
   the Code.  On a date that is mutually agreeable to Parent and
   Purchaser, which shall be no later than the last day of the 12th
   month following the Closing Date, there shall be a transfer from
   the HI TRIP to a trust, separate account or other funding vehicle
   under such plan(s) contemplated herein and maintained by Purchaser
   (or by the Company) (i) the obligation for benefit payments under
   the HI TRIP to all TRIP Eligible Employees and (ii) an amount of
   assets, in cash or in kind (if the assets are mutually agreeable to
   Parent and Purchaser), equal to the aggregate account balances
   under the HI TRIP of all TRIP Eligible Employees, determined as of
   a valuation date not more than three Business Days prior to the
   date of the transfer as determined by Parent.  Prior to the date of
   such transfer, Purchaser shall furnish Parent the following, to the
   extent applicable, (i) at Parent's request, copies of the
   Purchaser's (or the Company's) plan(s) contemplated herein and the
   trust or other funding agreements thereunder, together with any
   amendments thereof, (ii) copies of the most recent determination
   letter(s) issued by the IRS with respect to the qualification under
   Section 401(a) of the Code of Purchaser's (or the Company's)
   plan(s) contemplated herein, (iii) copies of any applications for
   determination with respect to such plan(s) and as to which
   determination letters have not yet been received, (iv) if no
   determination letter(s) have yet been received with respect to the
   initial qualification of Purchaser's (or the Company's) plan(s)
   contemplated herein, or if such plan(s) have been amended since the
   date of the last determination letter(s), a letter from counsel to
   Purchaser, satisfactory to Parent, that provides that the plan(s)
   (or plan(s), as amended) are intended to satisfy the qualification
   requirements of Section 401(a) of the Code and that Purchaser will
   timely make (or cause the Company to make) such amendments as may
   be required by the Internal Revenue Service to receive the
   determination letter(s) and (v) evidence satisfactory to Parent
   that Purchaser's (or the Company's) plan(s) contain language
   providing for the receipt of the transferred assets as provided
   herein.  Prior to the transfers described herein, Parent shall
   continue to administer the account balances of the TRIP Eligible
   Employees in such manner as Parent, in its sole discretion, shall
   determine, and *CONFIDENTIAL 14*.  At Parent's request, Purchaser
   (or the Company) shall make payroll withholding arrangements to
   ensure that TRIP Eligible Employees' loans from HI TRIP are timely
   repaid.
   
             (c)  *CONFIDENTIAL 15* 
   
             (d)  Except as otherwise provided in this Article VIII,
   Purchaser makes no representations, warranties or covenants with
   respect to any compensation or benefits to be offered or provided
   to employees or former employees of any Acquired Company after the
   Closing Date.
   
        SECTION 8.5.  Excess Benefit Plan
   
             (a)  Parent shall provide Purchaser with a list of each
   employee or former employee of any Acquired Company other than
   employees of the Retained Subsidiaries and the PPA Companies who is
   covered under the Household International Supplemental Retirement
   Income Plan and the benefit accrued under such plan through the
   Closing Date by each such person.  Purchaser shall amend its
   previously adopted excess defined benefit plan or shall adopt (or
   cause the Company to adopt) an excess defined benefit plan to cover
   such employees and former employees, and each such person's accrued
   benefit under Purchaser's (or the Company's) plan shall not be less
   than such person's benefit accrued through the Closing Date as
   shown on such list.  As soon as practicable following the Closing
   Date, and based on the assumptions used in Parent's actuarial
   report from Towers Perrin dated March 1995, Parent shall transfer
   cash or assets acceptable to Purchaser equal to the present value
   of such accrued benefits plus interest (at the rate of 7.75% per
   annum), less any benefit payments made in the interim to the date
   of transfer.  The obligation to provide such benefits prior to the
   Closing Date in the case of any employee whose employment is
   terminated prior to the date of the transfer of assets contemplated
   herein shall remain that of Parent until such transfer of assets.
   
             (b)  Parent shall provide Purchaser with a list of each
   employee or former employee of any Acquired Company other than
   employees of the Retained Subsidiaries and the PPA Companies who is
   covered under the Household International Supplemental Tax
   Reduction Investment Plan and the account balances under such plan
   through the Closing Date for each such person.  Purchaser shall
   amend its previously adopted excess defined contribution plan or
   shall adopt (or cause the Company to adopt) an excess defined
   contribution plan to cover such employees and former employees, and
   each such person's opening account balance under Purchaser's (or
   the Company's) plan shall not be less than such person's account
   balance through the Closing Date as shown on such list.  As soon as
   practicable following the Closing Date, Parent shall transfer cash
   or assets acceptable to Purchaser equal to the account balance of
   each such person at the Closing Date plus reasonable interest to
   the date of transfer.  The obligation to provide benefits in the
   case of any employee whose employment is terminated prior to the
   date of the transfer of assets contemplated herein shall remain
   that of Parent until such transfer of assets.
   
        SECTION 8.6.  Employee Welfare Benefit Plans
   
             (a)  Definitions.  In addition to terms defined elsewhere
   in this Agreement, the following terms shall have the following
   meanings for purposes of this Section 8.6:
   
                  (i)  "COBRA" shall mean the Consolidated Omnibus
             Budget Reconciliation Act of 1985, as amended.
   
                  (ii) "Former Employees" shall mean the individuals
             who have terminated (or terminate) employment with the
             Acquired Companies other than employees of the Retained
             Subsidiaries and the PPA Companies prior to and including
             the Closing Date, and who have made a prior election, are
             eligible to elect, or will be eligible to elect
             continuation coverage under COBRA in the future.
   
                  (iii) "Present Employees" shall mean the
             individuals who are employed by the Acquired Companies
             other than employees of the Retained Subsidiaries and the
             PPA Companies as of the Closing Date.
   
                  (iv) "Retirees" shall mean all individuals who have
             retired in the past or who elect retirement prior to or
             as of the Closing Date from the employ of the Acquired
             Companies (including any individuals who retired from any
             predecessors to the Acquired Companies) and are eligible
             for and/or enrolled for post-retirement benefits under
             one or more of  Parent's welfare plans listed in
             Exhibit 5.17.
   
                  (v)  "Welfare Plan" shall mean an employee welfare
             benefit plan as described in Section 3(1) of ERISA.
   
             (b)  Cessation of Participation in Parent's Welfare Plans
   
                  (i)  Effective on the Closing Date, Company shall
             cease participation in any Welfare Plan sponsored by
             Parent, including, but not limited to, all fully insured
             Welfare Plans (including Health Maintenance Organization
             and Dental Maintenance Organization contracts), all self-
             insured coverages and the Parent's Internal Revenue Code
             Section 125 Plan and any Health or Dependent Care
             Spending Accounts thereunder.  Purchaser (or the Company)
             shall give written notice to all of  the Company's
             Welfare Plan participants, including Former Employees,
             Present Employees and Retirees that the Company has
             assumed full responsibility for all Welfare Plan benefits
             in accordance with clause (ii) below.
   
                  (ii) Effective on the Closing Date, Purchaser (or
             the Company) shall assume full responsibility for all
             Welfare Plan coverages as follows.  All Present
             Employees, Retirees  and Former Employees shall be
             eligible for immediate coverage under Purchaser's (or the
             Company's) Welfare Plans, with waiver of any pre-existing
             conditions and including coverage required under COBRA,
             and neither Parent, nor any member of Parent's controlled
             group shall thereupon be responsible, or liable, for
             coverage (including any past, present or future coverage
             required under COBRA) of such individuals.
   
                  (iii)     With respect to Retiree Welfare Plan
             coverages currently provided under Parent's Welfare
             Plans, the Company shall establish Retiree Health Plans
             covering all Retirees as defined under this Section 8.6,
             and shall assume all liability for the Retiree Welfare
             Plan coverages as of such date.  The Parties acknowledge
             that nothing in this clause (iii) is intended to limit
             Purchaser's or the Company's ability to amend such
             Retiree Health Plans on or after the Closing Date.
   
             (c)  Transitional Matters
   
                  (i)  Liabilities under the Welfare Plans for claims
             incurred prior to the Closing Date shall remain with
             Parent under its Welfare Plans.
   
                  (ii) Parent and Purchaser shall mutually agree upon
             the method of handling the transitional issues related to
             cafeteria plans including the transfer of any Health or
             Dependent Care Spending Account credits.
   
        SECTION 8.7.  Benefits Transition
   
        On and after the Closing Date, neither Parent nor Seller shall
   have any liability with respect to any plans or benefits listed in
   Exhibit 5.17 as they apply to employees or former employees of the
   Acquired Companies, and the Company assumes all liability therefor;
   provided, however that (a) the Company shall not assume any
   liability for accruals to the Closing Date for the HI RIP, the HI
   TRIP and the excess plans until such time, if any, that the
   respective plan assets (and amounts described in Section 8.5(a) and
   (b)) are transferred, (b) liabilities under welfare benefit plans
   for claims and other events that occur prior to the Closing Date
   shall remain with Parent under its plans and (c) for stock options
   and other plans or programs over which the Acquired Companies do
   not have control, Parent shall remain obligated and no liability
   therefor will be assumed by any Acquired Company.
   
   
                              ARTICLE IX.
                         CONDITIONS TO CLOSING
   
        SECTION 9.1.  Conditions to Each Party's Obligations
   
             The respective obligations of each Party to effect the
   transactions contemplated hereby shall be subject to the following
   conditions:
   
             (a)  Absence of Restraints.  At the Closing Date, there
   shall be no litigation, claim, action, governmental or other
   proceeding, investigation, inquiry, or review, pending or
   threatened, to restrain, prohibit, invalidate, or set aside in
   whole or in part the consummation of this Agreement or the
   transactions contemplated hereby or to obtain substantial damages
   in connection therewith.  There shall be in effect no judgment,
   injunction, order, writ, decree, or ruling of any court, government
   or governmental authority of competent jurisdiction restraining or
   prohibiting in whole or in part the transactions contemplated
   hereby.
   
             (b)  Consents.  All consents, approvals, waivers, and
   actions of governmental authorities and others necessary to permit
   the Parties to consummate the transactions contemplated hereunder
   shall have been obtained or waived.
   
             (c)  Ancillary Agreements.  The Parties shall have
   entered into such other agreements as contemplated by this
   Agreement, including but not limited to the Transaction Documents.
   
        SECTION 9.2.  Conditions to Sellers' Obligations  
   
             The obligations of Sellers to consummate the transactions
   contemplated by this Agreement are subject to the satisfaction, at
   or prior to the Closing Date, of each of the following conditions
   (any or all of which may be waived by Sellers):
   
             (a)  Compliance with Covenants.  Purchaser shall have
   performed and complied in all material respects with the terms,
   covenants and conditions required by this Agreement to be performed
   or complied with by it on or before the Closing Date.
   
             (b)  Representations and Warranties True and Correct. 
   The representations and warranties of Purchaser contained in this
   Agreement shall be true and correct in all material respects as of
   the Closing Date with the same force and effect as though such
   representations and warranties had been made as of the Closing
   Date, and Sellers shall have received as of the Closing Date a
   certificate of an authorized officer of Purchaser, dated as of the
   Closing Date, to such effect.
   
             (c)  Opinion of Counsel.  Seller shall have received from
   John D. Hopkins, General Counsel of Purchaser, an opinion dated the
   Closing Date, in a form satisfactory to Seller, to the effect that:
   
                  (i)  Purchaser is a corporation duly organized,
             validly existing and in good standing under the laws of
             North Carolina, and Purchaser has the corporate power and
             authority to own its properties and conduct its business
             as currently conducted.
   
                  (ii) All corporate proceedings required on the part
             of Purchaser to authorize the execution, delivery and
             performance of the Agreement, the purchase of the Shares
             and the Note hereunder by Purchaser and other obligations
             contemplated hereunder have been duly completed.
   
                 (iii) This Agreement has been and the other
             agreements to be executed by Purchaser on the Closing
             Date as contemplated by this Agreement will be, duly
             executed and delivered by Purchaser and are valid and
             binding upon, and enforceable against, Purchaser in
             accordance with their terms, subject, as to the
             enforceability of remedies, to applicable bankruptcy,
             insolvency, reorganization, moratorium and similar laws
             of general applicability relating to or affecting
             creditors' rights and to general principles of equity.
   
                  (iv) All consents and approvals from any
             governmental or regulatory authority that are required
             for Purchaser to consummate the transactions contemplated
             by this Agreement have been received and obtained.
   
             (d)  No Litigation.  There shall not be pending or, to
   the knowledge of any executive officer of Purchaser, threatened,
   any claim, suit, action or other proceeding by any governmental
   agency before any court or governmental agency, seeking to prohibit
   or restrain the transactions contemplated by the Agreement or
   seeking material damages in connection therewith.  The waiting
   period required by the HSR Act shall have expired or the Parties
   shall have been granted early termination.  All approvals appearing
   on Exhibit 6.4 shall have been obtained.
   
             (e)  Corporate Actions.  All corporate and other acts
   necessary to authorize Purchaser's execution, delivery, and
   performance of this Agreement and the Transaction Documents and the
   consummation of the transactions contemplated hereunder and
   thereunder shall have been taken by Purchaser.
   
             (f)  Corporate Documents.  At the Closing, Purchaser
   shall have delivered to Sellers:
   
                  (i)  a certificate of its jurisdiction of
             incorporation dated not earlier than the 10th day
             preceding the Closing Date, to the effect that Purchaser
             is a corporation validly existing and in good standing
             (if applicable) under the laws of such place of
             jurisdiction as of such date;
   
                  (ii) certificates of the Secretary or Assistant
             Secretary of Purchaser attaching (A) duly enacted
             resolutions of Purchaser's board of directors with
             respect to the approval of this Agreement and the
             Transaction Documents and any other agreements executed
             and delivered among the Parties hereby and thereby and
             the performance and consummation hereby and thereby and
             the authorization of the officers of Purchaser to sign
             this Agreement, which resolutions shall continue to be in
             force as of the Closing Date, and (B) specimen signatures
             of the officers of Purchaser authorized to sign this
             Agreement and the Transaction Documents;
   
                 (iii) a copy, certified as true by the Secretary
             or Assistant Secretary of Purchaser, of the
             organizational documents of Purchaser; and
   
                  (iv) all other documents, instruments, and writings
             required to be delivered by Purchaser pursuant to this
             Agreement.
   
        SECTION 9.3.  Conditions to Purchaser's Obligations  
   
             The obligations of Purchaser to consummate the
   transactions contemplated by this Agreement are subject to the
   satisfaction on or prior to the Closing Date of each of the
   following conditions (any or all of which may be waived by
   Purchaser):
   
             (a)  Compliance with Covenants.  Parent, Seller and the
   Company shall have performed and complied in all material respects
   with the terms, covenants and conditions required by this Agreement
   to be performed or complied with by them on or before the Closing
   Date.
   
             (b)  Representations and Warranties True and Correct. 
   The representations and warranties of Parent and Seller contained
   in this Agreement shall be true and correct in all material
   respects as of the Closing Date with the same force and effect as
   though such representations and warranties had been made as of the
   Closing Date, and Purchaser shall have received a certificate,
   dated as of the Closing Date, executed by an authorized officer of
   each such Party, to such effect.
   
             (c)  Opinion of Counsel.  Purchaser shall have received
   from John W. Blenke, counsel to Parent and Seller, an opinion dated
   the Closing Date in a form satisfactory to Purchaser to the effect
   that:
   
                  (i)  Each of Seller and Parent is a corporation
                       duly organized, validly existing and in good
                       standing under the law of the State of
                       Delaware, and all corporate proceedings
                       required on the part of Seller and Parent to
                       authorize the execution, delivery and
                       performance of the Agreement and the
                       Transaction Documents and the sale of Shares
                       and the Note hereunder have been duly
                       completed.
             
                  (ii) The Company is a corporation duly
                       incorporated, validly existing and in good
                       standing under the laws of the State of
                       Michigan, with full corporate power and
                       authority to own, operate and lease its
                       properties and to carry on its business as
                       presently being conducted.  The Company is
                       duly qualified to do business as a foreign
                       corporation and is in good standing, if
                       applicable, in each jurisdiction where the
                       failure to be so qualified, if qualification
                       is required, would have a Material Adverse
                       Effect.  Each of the Company and First
                       Alexander Hamilton Life Insurance Company is
                       duly qualified to do business as a stock life
                       insurance company and is in good standing, if
                       applicable, as an insurance corporation in the
                       jurisdictions listed in Exhibit 5.1(b).  All
                       corporate proceedings required on the part of
                       the Company to authorize the execution,
                       delivery and performance of the Agreement have
                       been duly completed.
        
                 (iii) The Agreement and the Transaction
                       Documents have been duly executed and
                       delivered by Parent and Seller and are
                       valid and binding upon, and enforceable
                       against, each of them in accordance with
                       their terms, subject, as to the
                       enforceability of remedies, to applicable
                       bankruptcy, insolvency, reorganization,
                       moratorium and similar laws of general
                       applicability relating to or affecting
                       creditors' rights and to general
                       principles of equity.
   
                  (iv) The authorized capital stock of the Company
                       consists solely of 500,000 shares of common
                       stock, par value $10.00 per share, of which
                       375,000 shares issued and outstanding.  The
                       Company has no other shares of capital stock
                       of any class or other equity securities
                       authorized, issued or outstanding, and there
                       are no outstanding or authorized options,
                       warrants, calls, subscriptions, rights,
                       agreements or commitments of any character
                       obligating the Company to issue any shares of
                       its capital stock or securities convertible
                       into or exchangeable for or evidencing the
                       right to purchase or subscribe for any shares
                       of capital stock of the Company.  The Shares
                       have been validly issued, fully paid and are
                       nonassessable and free of preemptive rights.
   
                  (v)  Seller is the beneficial and legal registered
                       owner of the Shares and Parent is the legal
                       registered owner of the Note.  Upon
                       consummation of the transactions contemplated
                       by the Agreement and the Transaction
                       Documents, Purchaser will acquire good and
                       valid title to the Shares and Note, in each
                       case free and clear of all Encumbrances.
   
                  (vi) The Company is the registered owner of all
                       outstanding shares of the capital stock of
                       each of the Acquired Subsidiaries, and each of
                       the Acquired Subsidiaries is a corporation
                       (A) duly incorporated, validly existing and in
                       good standing, if applicable, under the laws
                       of the jurisdiction of its incorporation, with
                       full corporate power and authority to own,
                       operate and lease its properties and carry on
                       its business as presently being conducted and
                       (B) duly qualified to do business as a foreign
                       or domestic corporation and in good standing,
                       if applicable, in all jurisdictions in which
                       failure to be so qualified, if qualification
                       is required, would have a Material Adverse
                       Effect.
   
             (d)  Corporate Actions.  All corporate and other acts
   necessary to authorize the execution, delivery, and performance of
   this Agreement and the Transaction Documents and the consummation
   of the transactions contemplated hereunder and thereunder shall
   have been taken by the Alexander Hamilton Parties.
   
             (e)  Shares and Note.  Seller and Parent shall have
   delivered to Purchaser certificates representing the Shares and the
   original Note, respectively, endorsed for transfer to Purchaser or
   accompanied by an assignment duly executed.
   
             (f)  Corporate Documents.  At the Closing, Sellers shall
   have delivered to Purchaser:
   
                  (i)  a certificate of its jurisdiction of
             incorporation dated not earlier than the date of the 10th
             day preceding the Closing Date for each of Sellers and
             the Acquired Subsidiaries, to the effect that such
             corporation is a corporation validly existing and in good
             standing (if applicable) under the laws of such place of
             jurisdiction as of such date;
   
                  (ii) certificates of the secretary or assistant
             secretary of each of the Alexander Hamilton Parties
             attaching (A) duly enacted resolutions of its board of
             directors with respect to the approval of this Agreement
             and the Transaction Documents and any other agreements
             executed and delivered among the Parties hereby and
             thereby and the performance and consummation hereby and
             thereby and the authorization of the officers of such
             Person to sign this Agreement, which resolutions shall
             continue to be in force as of the Closing Date and
             (B) specimen signatures of the officers of such Person
             authorized to sign this Agreement and the Transaction
             Documents;
   
                  (iii) a copy, certified as true by the secretary
             or assistant secretary of each of Sellers and the
             Acquired Companies, of the articles of incorporation and
             the by-laws of such Person; and
   
                  (iv) all other agreements (including the Transaction
             Documents), documents, instruments and writings required
             to be delivered by Sellers or the Company pursuant to
             this Agreement.
   
   
                              ARTICLE X.
                              TERMINATION
   
        SECTION 10.1.  Termination
   
             This Agreement (except for the provisions of
   Section 5.23, 6.8, 13.3, and 13.5 which will continue in effect)
   may be terminated and the transactions contemplated hereunder
   abandoned:
   
             (a)  At any time prior to the Closing Date by the mutual
   written agreement of Sellers and Purchaser;
   
             (b)  By Sellers:
   
                  (i)  if the Closing is not consummated on or before
             December 31, 1995, unless the failure of such occurrence
             shall be due to the intentional failure of any of the
             Alexander Hamilton Parties to perform or observe the
             covenants, agreements and conditions hereof to be
             performed or observed by such entity at or before the
             Closing Date;
   
                  (ii) if events occur which render impossible
             compliance with one or more of the conditions set forth
             in Sections 9.1 and 9.2 hereof and such conditions are
             not waived by Parent; provided that such events did not
             result from any action or omission by any Alexander
             Hamilton Parties which was within the control of such
             entity and which such entity was not expressly permitted
             to take or omit by the terms of this Agreement; or
   
                 (iii) if any Alexander Hamilton Party is
             enjoined by any administrative agency, commission or
             court and such injunction prevents the performance by the
             Alexander Hamilton Parties of their obligations hereunder
             and such injunction shall not have been withdrawn by the
             earlier to occur of the date which is 60 days after the
             date on which such injunction was first issued or
             December 31, 1995.
   
             (c)  By Purchaser:
   
                  (i)  if the Closing is not consummated on or before
             December 31, 1995, unless the failure of such occurrence
             shall be due to the intentional failure of Purchaser to
             perform or observe the covenants, agreements and
             conditions hereof to be performed or observed by it at or
             before the Closing Date;
   
                  (ii) if events occur which render impossible
             compliance with one or more of the conditions set forth
             in Sections 9.1 and 9.3 hereof and such conditions are
             not waived by Purchaser; provided that such events did
             not result from any action or omission by Purchaser which
             was within its control and which Purchaser was not
             expressly permitted to take or omit by the terms of this
             Agreement; or
   
                 (iii) if Purchaser is enjoined by any
             administrative agency, commission or court and such
             injunction prevents the performance by Purchaser of its
             obligations hereunder and such injunction shall not have
             been withdrawn by the earlier to occur of the date 60
             days after the date on which such injunction was first
             issued or December 31, 1995.
   
   
                              ARTICLE XI.
                     SURVIVAL AND INDEMNIFICATION
   
        SECTION 11.1.  Survival
   
             The representations and warranties made herein or in any
   Transaction Document or other documentation delivered hereby or
   thereby shall survive the Closing Date for *CONFIDENTIAL 16*;
   provided, however that (i) the representations and warranties of
   Sellers in Sections 5.3, 5.5, 5.6 and 5.7, (ii) the representations
   and warranties of Sellers in Section 5.31 (but only to the extent
   that the representations and warranties in Section 5.31 relate to
   Investments or property interests that were not owned, leased or
   operated by any of the Acquired Companies at any time after the
   Closing); and (iii) all covenants, agreements and indemnification
   matters, other than as otherwise provided in Section 11.2(a)(i),
   (iii) or (iv), shall survive *CONFIDENTIAL 16*; provided, further,
   that the representations, warranties, agreements, covenants and
   indemnification matters of Article XII shall survive *CONFIDENTIAL
   16*. 
   
        SECTION 11.2.  Sellers' Indemnification
   
             (a)  Except with respect to Taxes (which are provided for
   in Article XII exclusively), Sellers jointly and severally shall
   indemnify and hold harmless Purchaser, its Affiliates, officers,
   directors, employees, agents, successors, and assigns and related
   entities from and reimburse them for any loss, cost, expense,
   damage (including damages to Persons, property or the environment),
   liability, fines, penalties or claim (including all Legal Fees,
   engineering and other consultant fees and expenses and collectively
   the "Indemnified Costs") relating to, arising out of, based upon,
   or resulting from:
   
                  (i)  (A)  Any inaccuracy in any representation or
             warranty made by Parent or Seller in this Agreement or
             the Transaction Documents for which indemnification is
             claimed hereunder within the applicable survival period;
             and
                  
                       (B)  The Company's or any of its subsidiaries,
             violation of, or liabilities under, any Environmental
             Laws, irrespective of whether known as of the Closing
             Date; provided that, if a claim for indemnification under
             this subclause (B) relates to an Investment or other
             property interest that was owned, leased or operated by
             any of the Acquired Companies at any time after the
             Closing, such claim for indemnification shall be valid
             only if made within *CONFIDENTIAL 16* following the
             Closing Date;
   
             provided, that Sellers shall not have any liability for
             such indemnification pursuant to *CONFIDENTIAL 17*, in
             which case Sellers' liability shall be only for such
             excess and, provided, further, that such limitation shall
             not apply to the breach of any representation or warranty
             contained in Sections 5.3, 5.5, 5.6 or 5.7 or
             Article XII;
   
                  (ii) Seller's, Parent's or the Company's breach of
             or failure to perform any of its covenants or agreements
             contained in or made pursuant to this Agreement or the
             Transaction Documents;
   
                 (iii) *CONFIDENTIAL 17*; 
   
                  (iv) *CONFIDENTIAL 17*; 
   
                  (v)  *CONFIDENTIAL 17*; 
   
                  (vi) *CONFIDENTIAL 17*; and 
   
                 (vii)  Any Indemnified Liability.
   
             (b)  *CONFIDENTIAL 17*: 
   
                  (i)  to the extent and in the amount of any
             nonutilized provision or reserve in respect of the
             matter, action, or proceeding giving rise to any such
             liability specifically made by the Company or the
             Acquired Subsidiaries and such reserve is reflected on
             the Closing Date Statutory Statements as agreed by the
             Parties in accordance with Section 2.3;
   
                  (ii) to the extent such liability arises from some
             act or omission of Purchaser at any time or of the
             Company after the Closing Date; and
   
                 (iii) to the extent that Purchaser, the Company,
             or any Affiliate thereof obtains a Tax Benefit.
   
             (c)  (i)  *CONFIDENTIAL 17* 
   
                  (ii) *CONFIDENTIAL 17* 
   
             (d)  Notwithstanding anything else contained in this
   Section 11.2, with respect to any breach of a representation or
   warranty in Article V hereof, no claims for *CONFIDENTIAL 17*  
   shall be permitted unless a trier of fact or arbitrator determines
   that an executive officer of the Alexander Hamilton Parties knew
   that the information on which such a claim is based was inaccurate
   or unless the issue is one of ownership of any of the Acquired
   Companies.  Under no circumstances shall an award include punitive
   or exemplary damages. 
   
        SECTION 11.3.  Purchaser's Indemnification
   
             (a)  Except for Taxes (which are provided for in
   Article XII exclusively), Purchaser shall indemnify and hold
   Seller, Parent, its Affiliates, officers, directors, employees,
   agents, successors, and assigns, and related entities from, and
   reimburse them for, Indemnified Costs relating to, arising out of,
   based upon, or resulting from
   
                  (i)  Any inaccuracy in any representation or
             warranty made by Purchaser in this Agreement; provided
             that Purchaser shall not have any liability for such
             indemnification pursuant to this clause (i) unless the
             aggregate of all Indemnified Costs under this clause (i)
             for which Purchaser would, but for this proviso, be
             liable exceeds on a cumulative basis *CONFIDENTIAL 17*,
             in which case Purchaser's liability shall be only for
             such excess and, provided, further, that such limitation
             shall not apply to the breach of any representation or
             warranty contained in Section 6.2;
   
                  (ii) Purchaser's breach of or failure to perform any
             of its covenants or agreements contained in or made
             pursuant to this Agreement or the Transaction Documents
             after the Closing Date; and
   
                 (iii) The operation of the Individual Business
             after the Closing Date.
   
             (b)  Notwithstanding the foregoing, Purchaser shall not
   have any liability to the extent that Parent, Seller or any
   Affiliate thereof obtains a Tax Benefit.
   
        SECTION 11.4.  Indemnification Procedure
   
             (a)  Except for Taxes (which are provided for in
   Article XII exclusively), any Person claiming indemnification
   pursuant to this Agreement shall promptly notify the indemnifying
   Party in writing of the occurrence of any event that such Person
   asserts is or may be an indemnifiable event pursuant to this
   Agreement.  If such event involves the claim of any third party and
   the indemnifying Party confirms in writing its responsibility for
   such liability, if established, the indemnifying Party shall be
   entitled to participate in and, to the extent it shall wish, assume
   control over (in which case the indemnifying Party shall assume all
   expense with respect to) the defense, settlement, adjustment or
   compromise of such claim.
   
             (b)  The indemnified Person shall have the right to
   employ separate counsel in any action or claim and to participate
   in the defense thereof at the expense of the indemnifying Party
   (i) if the retention of such counsel has been specifically
   authorized by the indemnifying Party, or (ii) if the counsel is
   retained because the indemnifying Party does not notify the
   indemnified Person within 20 days after receipt of a claim notice
   that it elects to undertake the defense thereof. The indemnified
   Person shall have the right to employ counsel at the indemnified
   Party's own expense and participate in such action or claim,
   including settlement or trial.
   
             (c)  The indemnifying Party shall obtain the prior
   written approval of the indemnified Person before entering into any
   settlement, adjustment, or compromise of such claim or ceasing to
   defend against such claim that provides for any relief other than
   the payment of monetary damages or which would have a materially
   adverse effect on the indemnified Person or its business or
   operations.
   
             (d)  If the indemnifying Party does not assume control
   over the defense of such claim as provided in Section 11.4(a)
   within 30 days of receipt of notice thereof, the indemnified Person
   shall have the right to defend the claim in such manner as it may
   deem appropriate at the cost and expense of the indemnifying Party
   to settle, adjust, or compromise such claim. 
   
             (e)  The indemnifying Party shall remit payment for the
   amount of a valid and substantiated claim for indemnification
   hereunder promptly upon receipt of a claim notice therefor.  Upon
   the payment in full of any claim hereunder, the indemnifying Party
   shall be subrogated to the rights of the indemnified Person against
   any person with respect to the subject matter of such claim.
   
             (f)  In the event that the indemnifying Party reimburses
   the indemnified Person for any third party claim, the indemnified
   Person shall remit to the indemnifying Party any reimbursement that
   the indemnified Person subsequently receives for such third party
   claim.
   
             (g)  Any matter as to which a claim has been asserted by
   written notice (describing in reasonable details the facts, events
   and circumstances relating to the subject matter of such claim and
   the amount (if reasonably calculable) of the Indemnified Costs in
   connection therewith) to the indemnifying Party that is pending or
   unresolved at the end of any applicable survival period shall
   continue, to the extent permitted by law, to be covered by this
   Article XI notwithstanding any applicable statute of limitations
   (which the Parties hereby waive) or the expiration of such survival
   period until such matter is finally terminated or otherwise
   resolved by the Parties under this Agreement or by a court of
   competent jurisdiction and any amounts payable hereunder are
   finally determined and paid.
   
   
                             ARTICLE XII.
                              TAX MATTERS
   
        SECTION 12.1.  Tax Sharing Agreements
   
             (a)  On the Closing Date, any Tax sharing agreements and
   arrangements between one or more of the Acquired Companies, on the
   one hand, and Seller and any of its Affiliates, on the other hand,
   shall be terminated, and no additional payments shall be made, or
   be due to be made, by any party thereunder, and this Article XII
   shall exclusively control any Tax-related issues between Seller,
   Parent, and Purchaser or involving any of the Acquired Companies.
   
             (b)  Notwithstanding any other provisions of this
   Agreement to the contrary, Seller shall be permitted, at the
   Seller's sole discretion, to make a "deemed dividend election" with
   respect to the Acquired Companies.
   
        SECTION 12.2.  Representations, Warranties, Agreements, and
   Covenants of Seller with Regard to Certain Tax Matters
   
             (a)  With the exception of Canadian income tax returns
   for the years 1991 through 1994, all Tax Returns required to be
   filed by or with respect to the Company and each Acquired
   Subsidiary for taxable periods ending on or prior to the Closing
   Date have been timely filed by them, or will be, and, with respect
   to the Company and the Acquired Subsidiaries, all such Tax Returns
   are or will be true and complete in all material respects. Complete
   and accurate copies of all federal and Canadian Tax Returns filed
   within the past three years have been furnished or made available
   to Purchaser.  Complete and accurate copies of all other Tax
   Returns filed within the past three years have been made available
   to Purchaser.  All Taxes reported on such Tax Returns have been
   paid when due or otherwise payable.  To the extent that any of the
   Taxes are not yet due and payable, the Company and each Acquired
   Subsidiary have accrued or otherwise adequately reserved for such
   Taxes on the Financial Statements in accordance with GAAP and
   Statutory Accounting Principles.
   
             (b)  The Company and each Acquired Subsidiary is a member
   of the affiliated group (as defined in Section 1504 of the Code) of
   which Parent is the common parent.  Parent has included or will
   include the Company and the Acquired Subsidiaries in its
   consolidated federal income Tax Returns for all taxable years that
   begin, on or after January 1, 1992, and end on or before the
   Closing Date, and, to the extent required by law, Parent, Seller or
   the Company has included the Company and the Acquired Subsidiaries
   in their consolidated, combined or unitary Tax Returns relating to
   state income Taxes.  The Seller and Parent shall be solely
   responsible for all Taxes related to the transfers to the PPA
   Companies and the Retained Subsidiaries, and the sale of the
   building pursuant to Section 7.15 hereof.
   
             (c)  Neither the Company nor any Acquired Subsidiary has
   received written notice from any governmental agency in a
   jurisdiction in which such entity does not file a Tax Return
   stating that such entity is subject to taxation by that
   jurisdiction.  Except as set forth on Schedule 12.2(c), neither the
   Company nor any Acquired Subsidiary is required to file any Tax
   Return in any jurisdiction outside the United States.
   
             (d)  Except as set forth in Exhibit 12.2(d), no Tax
   Return of the Company or any Acquired Subsidiary is currently being
   audited by any Taxing authority, and no Potential Tax Liability has
   been threatened by any Taxing authority.  Except as set forth in
   Exhibit 12.2(d), there is no agreement, waiver, or other document
   extending, or having the effect of extending, the period for
   assessment or collection of any Taxes of the Company or any
   Acquired Subsidiary, which extension or waiver is still in effect. 
   Sellers have delivered or made available to Purchaser correct and
   complete copies of all examination reports, statements of
   deficiencies and similar documents prepared by the IRS or any other
   taxing authority that relate to the income, operations or business
   of the Company or any Acquired Subsidiary with respect to any
   period ending on or after December 31, 1985.  All final adjustments
   made by the IRS with respect to any federal Tax Return of the
   Company or any Acquired Subsidiary have been reported to the
   relevant state, local, or foreign taxing authorities to the extent
   required by law.  The Financial Statements of the Company or any
   Acquired Subsidiary have accrued or adequately reserved for all
   Taxes assessed, asserted or claimed to be due (including any Taxes
   for subsequent tax years resulting from the carryover of audit
   adjustments from any prior year's tax returns).
   
             (e)  Except as set forth on Exhibit 12.2(e), no requests
   for ruling or determination letters filed by any of the Alexander
   Hamilton Parties with respect to the income, operations or business
   of the Company or any Acquired Subsidiary are pending with any
   taxing authority.
   
             (f)  Neither the Company nor any Acquired Subsidiary has
   filed a consent pursuant to Section 341(f) of the Code, or agreed
   to have Section 341(f)(2) of the Code apply to any disposition of
   a subsection (f) asset (as such term is defined in
   Section 341(f)(4) of the Code) owned by it.  No property of the
   Company or any Acquired Subsidiary is property that such a
   corporation is or will be required to treat as being owned by
   another Person pursuant to the provisions of Section 168(f)(8) of
   the Internal Revenue Code of 1954, as amended, and in effect
   immediately prior to the enactment of the Tax Reform Act of 1986,
   or is "tax exempt use property" within the meaning of
   Section 168(h)(1) of the Code.  Except as set forth in
   Exhibit 12.2(f), neither the Company nor any Acquired Subsidiary
   has agreed to or is required to make any adjustment pursuant to
   Section 481(a) of the Code by reason of a change in the accounting
   method initiated by any of the Alexander Hamilton Parties that is
   currently in effect.  Except as set forth in Exhibit 12.2(f),
   neither  Parent, Seller, the Company, nor any Acquired Subsidiary
   (x) has, for periods ending on or after January 1, 1992, been a
   member of an affiliated group filing a consolidated federal income
   tax return, other than the affiliated group the common parent of
   which is Parent, or (y) has any liability for Taxes of any Person
   (other than Parent, Seller, the Company and their Subsidiaries)
   under Treasury Regulation Sec. 1.1502-6 or any similar provision of
   state, local or foreign law, or as a transferee or successor, by
   contract, or otherwise.
   
             (g)  The Company and each Acquired Subsidiary are not in
   violation of any material applicable tax information reporting and
   tax withholding obligations (or with notice or lapse of time, or
   both, would be in violation).  Except as disclosed on Exhibit 12.2
   (g), the Company and the Acquired Subsidiaries have timely withheld
   from, and paid over to the appropriate taxing authorities, and have
   properly reported all employee salaries, wages and other
   compensation.  Each life insurance and annuity product issued, sold
   or administered by, or on behalf of, the Company or any Acquired
   Subsidiary has been, and is, in compliance in all material respects
   with Sections 72 and 264 of the Code.  The representations made in
   this paragraph shall only refer to those obligations arising from
   insurance policies not otherwise subject to an agreed upon
   indemnity between Seller and Company.
   
             (h)  Subject to Purchaser's cooperation as set forth in
   Section 12.4, Parent shall prepare and file in a timely manner the
   federal Tax Returns, and any other Tax Returns for Parent's
   consolidated return group required to be filed by or with respect
   to the Company and each Acquired Subsidiary for taxable periods
   ending on or before the Closing Date.  Parent shall pay all Taxes
   due with respect to such Tax Returns, regardless of when such Taxes
   are determined to be due, except that Purchaser shall reimburse
   Seller to the extent such Taxes are provided for in the Closing
   Date Statutory Statements.  If Seller requests within thirty days
   after Closing, each Acquired Company shall prepare for filing by
   Seller (at Seller's expense) any Tax Returns relating to the
   business or assets of the Acquired Company required to be filed
   after the Closing Date for any period ending on or before the
   Closing Date  The Tax Returns referred to in this Section 12.2(h)
   shall, to the extent permitted by applicable Tax law, be prepared
   on a basis consistent with the last previous such Return filed for,
   or with respect to, the respective Acquired Company. 
   Notwithstanding anything to the contrary in this Agreement,
   Purchaser shall pay any sales Taxes, transfer Taxes, registration
   fees, stamp Taxes and other similar Taxes imposed on the sale and
   purchase of the Shares.
   
             (i)  Seller agrees to provide Purchaser complete copies
   of all Tax Returns filed by Seller after the Closing Date for or
   with respect to each Acquired Company, no later than 30 Business
   Days after such Returns have been timely filed with the applicable
   taxing authorities, taking into account all valid extensions of
   time to file such Returns.
   
             (j)  Purchaser shall prepare and file in a timely manner
   all Tax Returns, other than the Tax Returns provided for in
   paragraph (h) above, that are required to be filed by or with
   respect to the Company and each Acquired Subsidiary for Straddle
   Periods.  Seller shall be obligated for the portion of the Taxes 
   properly allocable to the time period from the start of the
   Straddle Period through the Closing Date, as determined in
   accordance with the provisions of Section 12.5.  Except to the
   extent provided for in the Closing Date Statutory Statements,
   Seller shall pay its allocable share of all Taxes due with respect
   to such Tax Returns under this paragraph (j), regardless of when
   such Taxes are determined to be due.  Purchaser agrees to provide
   to Seller complete copies of all such Tax Returns no later than the
   time period prescribed in paragraph (i) above.
   
             (k)  Seller and Purchaser agree that the Tax Returns
   filed pursuant to paragraphs (h) and (j) above will reflect the
   transactions related to the Business Transfer described in
   Section 7.13 of the Agreement.
   
             (l)  In the event that the IRS or any other taxing
   authority collects from Purchaser or any Acquired Company (i) any
   amount of Taxes attributable to taxable periods that end on or
   prior to Closing or (ii) any  amount of Taxes assumed by the Seller
   under the provisions of this Article, Purchaser or such Acquired
   Company shall be entitled to prompt, full reimbursement from Seller
   upon demand for such Tax after payment of such Tax by Purchaser or
   such Acquired Company to the taxing authority (to the extent not
   reserved for on the Closing Date Statutory Statements). 
   Notwithstanding the prior sentence, Seller's liability for Taxes
   under this Section 12.2(l) shall be  adjusted to reflect any Tax
   Benefit from the payment of such Tax by Purchaser or such Acquired
   Company. 
   
             (m)  Seller shall have no obligation to indemnify the
   Purchaser or the Acquired Companies pursuant to this Article XII
   with respect to any Potential Tax Liability if (i) the Acquired
   Companies or Purchaser failed to give notice as required in
   Section 12.4(j) hereof (excluding any failure when the Seller has
   actual knowledge of the Potential Tax Liability, or in
   circumstances in which it is not reasonably practicable for the
   Acquired Companies or Purchaser to notify Seller prior to
   themselves paying such Potential Tax Liability) and (ii) the
   ability of Seller to defend, negotiate, settle, or obtain refunds
   for such Potential Tax Liability was materially harmed by the
   failure of the Acquired Companies or Purchaser to give such notice.
   
             (n)  Immediately prior to the distributions referred to
   in Section 7.13 of the Agreement and the sale and purchase of the
   Shares, Seller shall cause each Acquired Company to adopt, solely
   for the tax purposes of Sections 332 and 338 of the Code, a plan
   that shall constitute a plan of complete liquidation.  The Business
   Transfer distributions pursuant to such Section 7.13 shall be made
   in accordance with such plans.  Seller shall present such plans to
   Purchaser for review at least 30 Business Days prior to Closing or
   the agreed upon date of the distributions, whichever is earlier.
   
        SECTION 12.3.  Representations, Warranties, Agreement, and
   Covenants of Purchaser with Regard to Certain Tax Matters
   
             Purchaser shall be responsible for the preparation of all
   Tax Returns for, or with respect to, each Acquired Company for any
   taxable period that ends after the Closing Date, and, to the extent
   such Taxes are not allocated or assumed by the Seller pursuant to
   Sections 12.2 and 12.5 herein, Purchaser and each Acquired Company
   shall be responsible for the payment of all Taxes due with respect
   to such Returns without reimbursement or indemnification from
   Seller.
   
        SECTION 12.4.  Joint Agreements and Covenants of Seller and
   Purchaser
   
             (a)  Purchaser and Parent shall allocate the Share
   Purchase Price and the Note Purchase Price in accordance with
   Section 1060 of the Code and the Treasury Regulations thereunder,
   and such allocation shall be used for purposes of determining the
   modified aggregate deemed sales price under applicable Treasury
   Regulations and in reporting the deemed sales of assets of the
   Company and its Acquired Subsidiaries in connection with the
   Section 338(h)(10) Elections.  Any adjustment to the Purchase Price
   or other consideration paid pursuant to this Agreement shall result
   in an appropriate adjustment to such allocation.
   
             (b)  Seller and Purchaser agree to join in making
   elections under section 338(g) and section 338(h)(10) of the Code
   and all comparable elections under state and local tax law
   (together, the "Section 338(h)(10) Elections") with respect to each
   of the Acquired Companies.  Notwithstanding any other provision in
   the Agreement or this Article XII, Purchaser (including the
   Acquired Companies), on the one side, and Seller, on the other
   side, shall bear their respective administrative, legal,
   accounting, and similar expenses resulting from the making of the
   Section 338(h)(10) Elections.
   
             (c)  Seller and Purchaser agree to cooperate fully with
   respect to the making of the Section 338(h)(10) Elections.  Such
   cooperation shall include, but not be limited to, the calculation
   of Adjusted Grossed-Up Basis, within the meaning of Treasury
   Regulation section 1.338(b)-1, the allocation of the Purchase Price
   in accordance with Section 12.4(g) below, and the preparation and
   delivery of any other related documentation required by the
   applicable taxing authorities.
   
             (d)  Purchaser shall prepare for delivery to Seller for
   review a fully completed set of IRS Form 8023-A and, if required,
   Form 8594, including all additional data and materials required to
   be attached to such Form 8023-A pursuant to the Treasury
   Regulations under section 338 of the Code. Such documents and forms
   shall be delivered to Parent or Seller for review by the earliest
   of (i) the tenth Business Day following the date Parent and
   Purchaser deem the Closing Date Financial Statements final, and
   (ii) the 45th Business Day prior to the date any such Section 338
   or 1060 forms are to be filed.
   
             (e)  Purchaser agrees to attach a copy of the agreed upon
   Form 8023-A (including Form 8594, to the extent required) referred
   to in Section 12.4(d) above, to the first federal income Tax Return
   (and any other applicable Tax Returns) filed for each of the
   Acquired Companies for the period beginning immediately after the
   Closing Date.  Seller agrees to attach a copy of such agreed upon
   Form 8023-A (including Form 8594, to the extent required) to the
   consolidated federal income Tax  Return (and any other applicable
   Tax Returns) in which Seller joins for the taxable period that
   includes the Closing Date.  The Parties agree to timely file such
   Tax Returns, including any extensions.
   
             (f)  Seller and Purchaser agree to treat the deemed
   transfer of the Acquired Companies' insurance contracts that will
   occur pursuant to the Section 338(h)(10) Elections as deemed
   assumption reinsurance transactions for federal income tax
   purposes.  Moreover, Seller and Purchaser agree to treat such
   deemed reinsurance transactions consistently for federal income tax
   purposes, and consistently report the nature and amount of any
   deemed ceding commissions, as determined in Section 12.4(g) below.
   
             (g)  No later than 60 days after the date of the
   Agreement, Seller and Purchaser agree to consult with each other in
   order to agree to the methodology for the allocation of the
   Purchase Price to the assets conveyed pursuant to the Agreement and
   to determine ceding commissions for the deemed reinsurance
   transactions resulting from the Section 338(h)(10) Elections, in
   each case using reasonable valuation methodologies.  If the Parties
   have agreed to the asset allocation, including the amount of any
   deemed ceding commissions (the "Allocation Agreement"), such
   agreement shall be reduced to writing prior to the Closing Date.
   
             (h)  Seller and Purchaser agree, and Purchaser shall
   cause the Acquired Companies, to retain all Tax or Tax-related
   records associated with the Acquired Companies for periods ending
   on or before the Closing Date until the expiration of the full
   period of the applicable statute of limitations, including any
   extensions thereof.  If the applicable statute of limitations have
   not expired by the end of the tenth year following the Closing
   Date, the Purchaser shall have the option of transferring the
   records to the Seller or Parent for their storage.  Each party
   agrees to notify the other of any extension of an applicable
   statute of limitations and each party shall  make a good faith
   effort to obtain the consent of the other party before destroying
   any of such records after the expiration of the statute of
   limitations period.
   
             (i)  Purchaser and Seller shall cooperate, and Purchaser
   shall cause the Acquired Companies to cooperate with Seller, with
   respect to the preparation and filing of any Tax Return (including
   amended Tax Returns) for which the other is responsible pursuant to
   this Article XII (including, but not limited to, providing work
   papers and schedules).
   
             (j)  Except as otherwise provided with respect to items
   relating to the allocation of the Purchase Price for the deemed
   sale of assets resulting from the making of the Section 338(h)(10)
   Elections, Purchaser shall prepare or cause the Acquired Companies
   to prepare, in a manner and at such time or times as is consistent
   with past practice but no later than May 1, 1996, the tax work
   paper preparation package or packages necessary to enable Seller to
   prepare consolidated federal and combined state and local Tax
   Returns for the period or periods from January 1, 1995 through the
   Closing Date.
   
             (k)  Purchaser and Seller each agree promptly to notify
   the other in writing within 30 Business Days from the receipt of
   notice of any pending or threatened tax audits or assessments
   ("Potential Tax Liability") of the Acquired Companies for any
   taxable periods ending on or before the Closing Date as long as
   such periods remain open.  The written notification shall contain
   information, to the extent known by the Purchaser or the Acquired
   Companies (or the Seller, as the case may be), describing the
   Potential Tax Liability.  With respect to any Potential Tax
   Liability that does not potentially affect the tax liability of any
   of the Acquired Companies for a tax period that includes or follows
   the Date of Closing, Seller shall have the sole right to represent
   the interests of the Acquired Companies in any tax audit or
   administrative or court proceeding to the extent relating to Taxes
   or Tax Returns filed for, or with respect to, the Acquired
   Companies for periods ending on or before the Closing Date.  With
   respect to any Potential Tax Liability that  potentially affects
   the tax liability of any of the Acquired Companies for a tax period
   that includes or follows the Date of Closing, Seller shall give due
   consideration to the interests of the Acquired Companies, and shall
   have the primary right to represent the interests of the Acquired
   Companies in any tax audit or administrative or court proceeding to
   the extent relating to Taxes or Tax Returns filed for, or with
   respect to, the Acquired Companies for periods ending on or before
   the Closing Date.  Seller may employ counsel of its choice at its
   expense, provided that Seller shall keep Purchaser reasonably
   informed on an ongoing basis.  Purchaser shall cooperate, and shall
   cause the Acquired Companies to cooperate, with Seller, with
   respect to any tax audit or administrative or court proceeding
   referred to in this paragraph.  Such cooperation shall include
   providing all relevant information that is available to Purchaser
   or the Acquired Companies, as the case may be, with respect to any
   such audit or proceeding, making personnel available at reasonable
   times and, including, without limitation, preparation of responses
   to requests for information, provided that the foregoing shall be
   done in a manner so as not to interfere unreasonably with the
   conduct of the business of Purchaser and the Acquired Companies. 
   Seller shall notify Purchaser at least 30 Business Days prior to
   settling or otherwise resolving any Potential Tax Liability that is
   likely to have a negative Tax detriment on any of the Acquired
   Companies after the Closing Date.  If Purchaser objects to the
   proposed settlement or resolution within the above 30 Business Day
   period, Purchaser may elect at its sole expense to further contest
   the Potential Tax Liability in which case Purchaser will indemnify
   Seller to the extent final settlement or other resolution of the
   Potential Tax Liability is on terms less favorable to Seller than
   the settlement or resolution proposed by Seller.  If Seller fails
   to provide notice to Purchaser under this section or fails to
   permit Purchaser to contest the Potential Tax Liability pursuant to
   the immediately preceding sentence, then in the event that the
   Seller settles or otherwise resolves any Potential Tax Liability
   that is likely to have a negative Tax detriment on any of the
   Acquired Companies, the Acquired Company will be entitled to
   receive prompt payment from the Seller of the detriment, determined
   under the Tax Benefit provisions of Section 12.6.  Purchaser shall
   notify Seller at least 30 Business Days prior to settling or
   otherwise resolving any Potential Tax Liability that is likely to
   have a negative Tax detriment on any of the Acquired Companies
   prior to the Closing Date.  If Seller objects to the proposed
   settlement or resolution within the above 30 Business Day period,
   Seller may elect at its sole expense to further contest the
   Potential Tax Liability in which case Seller will indemnify
   Purchaser to the extent final settlement or other resolution of the
   Potential Tax Liability is on terms less favorable to Purchaser
   than the settlement or resolution proposed by Purchaser.  If
   Purchaser fails to provide notice to Seller under this section or
   fails to permit Seller to contest the Potential Tax Liability
   pursuant to the immediately preceding sentence, then in the event
   that the Purchaser settles or otherwise resolves any Potential Tax
   Liability that is likely to have a negative tax detriment on
   Seller, the Seller will be entitled to receive prompt payment from
   the Purchaser of the detriment, determined consistently with the
   Tax Benefit provisions of Section 12.6.
   
             (l)  Seller shall have the right to pursue, and shall be
   entitled to retain, or receive prompt payment from the Acquired
   Companies or Purchaser of, any overpayment, refund or credit
   received by an Acquired Company or Purchaser with respect to Taxes
   (including, without limitation, refunds and credits arising by
   reason of Tax Returns as originally filed or amended Tax Returns
   filed after the Closing Date or adjustments by the IRS or
   comparable state or local taxing authorities) relating to the
   Acquired Companies that are the responsibility of Seller under this
   Article XII, plus any interest received with respect thereto from
   the applicable taxing authorities.   With respect to any request
   for refund, overpayment or credit that potentially affects the tax
   liability of any of the Acquired Companies for a tax period that
   includes or follows the Date of Closing, Seller shall give due
   consideration to the interests of the Acquired Companies, and shall
   have the primary right to represent the interests of the Acquired
   Companies in any tax audit or administrative or court proceeding to
   the extent relating to Taxes or Tax Returns filed for, or with
   respect to, the Acquired Companies for periods ending on or before
   the Closing Date.  Purchaser and Seller shall cooperate, and
   Purchaser shall cause the Acquired Companies to cooperate with
   Seller, with respect to claiming any refund or credit with respect
   to Taxes referred to in this Section 12.4(j).  Seller shall bear
   any out-of-pocket expenses incurred in seeking such refund or
   credit.  Seller shall notify Purchaser at least 30 Business Days
   prior to settling or otherwise resolving any Potential Tax
   Liability that is likely to have a negative Tax detriment on any of
   the Acquired Companies after the Closing Date.  If Purchaser
   objects to the proposed settlement or resolution within the above
   30 Business Day period, Purchaser may elect at its sole expense to
   further contest the Potential Tax Liability in which case Purchaser
   will indemnify Seller to the extent final settlement or other
   resolution of the Potential Tax Liability is on terms less
   favorable to Seller than the settlement or resolution proposed by
   Seller.  If Seller fails to provide notice to Purchaser under this
   section or fails to permit Purchaser to contest the Potential Tax
   Liability pursuant to the immediately preceding sentence, then in
   the event that the Seller settles or otherwise resolves any request
   for refund, overpayment or credit which is likely to have a
   negative tax detriment on any of the Acquired Companies, the
   Acquired Company will be entitled to receive prompt payment from
   the Seller of the detriment, determined under the Tax Benefit
   provisions of Section 12.6.  If, as the result of an examination by
   any taxing authority of any Tax Return or Tax of the Acquired
   Companies, (i) an adjustment is made which gives rise to a Tax
   deficiency payable by the Acquired Companies to such taxing
   authority that is attributable to any Tax period, or portion
   thereof, ending prior to or on the Closing Date, (ii) Seller or an
   Affiliate of Seller pays (or is obligated to pay) such deficiency
   or indemnifies (or is obligated to indemnify) Purchaser or the
   Acquired Companies under this Agreement for a payment of such
   deficiency, and (iii) such adjustment will reverse in a Tax period,
   or portion thereof, ending after the Closing Date, thereby
   producing a refund, credit, offset, or deduction to the Acquired
   Companies, Purchaser shall pay to Seller the amount of such Tax
   Benefit determined consistently with Section 12.6 below, within 30
   days after the Acquired Companies are notified by Seller of such
   adjustment.  However, if as the result of such an examination, (i)
   an adjustment is made which gives rise to a Tax Benefit to the
   Acquired Companies that is attributable to any Tax period ending
   prior to or on the Closing Date and (ii) such adjustment reverses
   in a Tax period ending after the Closing Date thereby producing a
   Tax detriment payable by the Acquired Companies to the taxing
   authorities, the Seller shall pay the amount of such Tax detriment,
   determined consistently with Section 12.6 below, to Purchaser
   within thirty days after demand is made by Purchaser to Seller for
   such payment.
   
             (m)  Sellers and Purchaser agree to cooperate in the
   prompt evaluation of a structure for the purchase of the Stock and
   the Note by Purchaser hereunder in which the Note is acquired by
   Purchaser from Parent for $50 million in cash and the Company,
   after giving effect to the Business Transfer and the dividend and
   other payments contemplated by Section 7.17, merges, in a
   transaction complying with Section 351 of the Code, into a direct
   or indirect subsidiary of Purchaser and Seller receives as
   consideration for the Stock in such merger cash in the amount of
   $475 million and preferred stock of such subsidiary of Purchaser
   that has characteristics that qualify it as stock under Section 351
   of the Code and has a face amount of $50 million and the terms
   mutually agreed by the Parties (the "Section 351 Transaction
   Structure").  Purchaser and Seller (i) agree to use their best
   efforts, if the conditions specified in the proviso below are
   satisfied, to effect the transactions contemplated hereunder
   pursuant to the Section 351 Transaction Structure and (ii) if the
   Section 351 Transaction Structure is implemented, agree that
   neither Seller nor Purchaser will make (or consent to be made) any
   Section 338(h)(10) Elections; provided that the Section 351
   Transaction Structure will not be utilized if the transactions
   contemplated hereby as modified by such structure (A) cannot be
   consummated on or prior to December 31, 1995, (B) have a Tax effect
   which is materially worse than Purchaser's federal, state and local
   Tax position if it had acquired the Stock and the Note directly
   from Parent and Seller without making a Section 338(h)(10)
   Election, (C) are likely to be deemed by any state insurance
   commissioner to constitute an assumption reinsurance transaction,
   (D) require the Company or the subsidiary of Purchaser as successor
   entity in the Section 351 Transaction Structure to be relicensed in
   any state; (E) require notice to or the consent of policyholders,
   (F) require the Acquired Companies' agents to be relicensed by any
   state insurance department, (G) require any new approvals from any
   state insurance department for any of the Acquired Companies'
   current products, (H) reduce the tax basis of Section 848 of the
   Code deferred acquisition costs which would have been otherwise
   available if the Stock had been acquired directly by Purchaser
   without making a Section 338(h)(10) Election or (I) have a Material
   Adverse Effect or materially adversely affect Purchaser; and
   provided further that if Seller and Purchaser have not jointly
   determined by September 30, 1995 that the foregoing conditions are
   likely to be satisfied, Seller and Purchaser agree that the
   Section 351 Transaction Structure will not be utilized and the
   transactions contemplated by this Agreement will be effected as
   provided in this Agreement without giving effect to this
   Section 12.4(m).
   
             If the Parties implement the Section 351 Transaction
   Structure pursuant to this Section 12.4(m), Parent will not
   purchase the building immediately prior to the transaction. 
   However, if the Section 351 Transaction Structure is implemented,
   but a final determination is made that Section 351 does not apply
   to the transaction and the Section 351 Transaction Structure is
   treated as an asset acquisition for Federal income tax purposes,
   Parent agrees to purchase the building referred to in Section 7.15
   on an "as is" basis without warranty, for a purchase price of $45
   million, adjusted to reflect a proration for utilities, taxes and
   other similar expenses, and upon such purchase the lease agreement
   relating to such building between Parent and the Company shall be
   terminated without additional expense to either party. A final
   determination for purposes of the immediately preceding sentence
   will consist of an adjustment to Taxes made by the IRS whether such
   adjustment is a result of or in settlement of any audit or other
   administrative proceeding or judicial proceeding or the filing of
   an amended return to reflect the consequences of any determination
   made in connection with any such audit or proceeding or otherwise,
   provided, however, that Purchaser will make a good faith effort, in
   consultation with Seller, to sustain the Section 351 Transaction
   Structure.  Parent's obligation to purchase the building under this
   provision shall expire on January 1, 2007.
   
             If the Parties agree prior to September 30, 1995 to
   implement the Section 351 Transaction Structure, and if Purchaser
   fails to close this transaction, Purchaser agrees to reimburse
   Seller for Seller's hedging costs incurred after September 30,
   1995, associated with the increased Tax cost that would result from
   an increase in the appreciation of the Company's assets.
   
        SECTION 12.5.  Straddle Period Tax Allocations  Any Taxes for
   a period that includes the Closing Date but does not terminate on
   such date (a "Straddle Period") shall be the joint responsibility
   of Purchaser and Seller, and shall be apportioned between the
   portion of the Straddle Period ending on the Closing Date and the
   portion beginning immediately after the Closing Date in accordance
   with this section.  Any Taxes allocable to the portion ending on or
   prior to the Closing Date will be the sole responsibility of
   Seller, and any Taxes allocable to the portion beginning after the
   Closing will be the sole responsibility of Purchaser.  Any Straddle
   Period Taxes based on actual activities or transactions (e.g., the
   Business Transfers, capital transactions, reinsurance outside the
   ordinary course of business, or real estate transfer taxes) shall
   be allocated based on the actual activities or transactions of each
   Acquired Company for such period.  All other Straddle Period Taxes
   (including all transaction related to regular, recurring items
   incurred in the ordinary course of business) shall be allocated
   based on the number of days in the portions of the Straddle Period
   before and after the Closing Date, respectively.
   
        SECTION 12.6.  Determination Of Tax Benefit  For purposes of
   this Article and the indemnification provisions of Article XI, any
   positive or negative Tax Benefit to a Party shall be determined in
   accordance with this Section.  If a Party actually derives, or is
   likely to derive, a benefit or suffer a detriment from (i) an
   increase (or decrease) in tax attributes, (ii) or the recognition
   of any item of income (or loss), the Tax Benefit (or detriment)
   shall be calculated.  The amount of the Tax Benefit (or detriment)
   shall be determined based on the present value of a refund, credit,
   offset, deduction, gain, or item of income and shall be determined
   using a discount rate equal to 12%, assuming that the Party will
   have sufficient taxable income and tax liability against which to
   use any such refund, credit, offset, or liability, and assuming an
   effective tax rate of 35%.
   
        SECTION 12.7.  Tax Dispute Resolution Mechanism  Any dispute
   with respect to this Article XII shall be resolved as follows:  the
   parties will in good faith attempt to negotiate a settlement of the
   dispute; if the parties are unable to negotiate a resolution of the
   dispute within 30 days after notice of such dispute is given by
   either party to the other party, the dispute will be submitted to
   (i) a nationally recognized accounting firm mutually agreed upon by
   Seller and Purchaser or (ii) if the Seller and Purchaser are unable
   to agree upon an accounting firm, each Party will select an
   accounting firm, and representatives of those firms will pick a
   nationally recognized accounting firm to resolve the dispute  (the
   "Tax Dispute Accountants").  The parties will present their
   arguments to the Tax Dispute Accountants within 15 days after
   submission of the dispute to the Tax Dispute Accountants.  The Tax
   Dispute Accountants will resolve the dispute, in a fair and
   equitable manner and in accordance with the applicable tax law,
   within 30 days, or as expeditiously as possible, after the parties
   have presented their arguments to the Tax Dispute Accountants,
   whose decision shall be final, conclusive and binding on the
   parties.  The fees and expenses of the Tax Dispute Accountants in
   resolving a dispute will be borne equally by Seller and Purchaser.
   
   
                             ARTICLE XIII.
                       MISCELLANEOUS PROVISIONS
   
        SECTION 13.1.  Entire Agreement; Waiver
   
        This Agreement, the Annexes and the exhibits attached hereto
   and the other writings specifically identified herein or executed
   and delivered by the Parties to be bound thereby in conjunction
   with this Agreement or the transactions contemplated hereby contain
   the entire agreement among the Parties with respect to the
   transactions contemplated hereby and thereby and supersede all
   previous written or oral negotiations, commitments, and writings. 
   No supplement or waiver of this Agreement shall be binding unless
   executed in writing and signed by the Party to be bound thereby. 
   No waiver of any of the provisions of this Agreement shall be
   deemed or shall constitute a waiver of any other provision hereof
   (whether or not similar), nor shall such waiver constitute a
   continuing waiver unless otherwise expressly provided.
   
        SECTION 13.2.  Amendment and Modification
   
             Subject to applicable law, this Agreement may be amended,
   modified, or supplemented only by written agreement of the Parties.
   
        SECTION 13.3.  Confidentiality
   
             (a)  None of the Parties to this Agreement nor any of
   their Affiliates shall issue any press release or public
   announcement concerning the contemplated transaction, the existence
   of this Agreement, or of the terms, conditions, and provisions of
   this Agreement (i) unless mutually agreed by Seller and Purchaser
   or (ii) except as required by law, in which event the disclosing
   Party shall consult with the other Parties to the extent
   practicable before making such disclosure.
   
             (b)  Each of the Parties and its respective Affiliates
   shall use reasonable precautions to keep confidential, in
   accordance with its customary procedures for handling confidential
   information of this nature and in accordance with safe and sound
   practices, any non-public information supplied to it by any other
   Party pursuant to this Agreement that is identified by such other
   Party as being confidential at the time the same is delivered to
   such Party, including without limitation, the negotiations between
   the Parties relating to the execution of this Agreement and the
   terms and conditions of this Agreement, to the extent that they are
   not in the public domain.  Such information shall be kept
   confidential and shall not be disclosed by the Parties otherwise
   than to each other; provided, that nothing herein shall limit the
   disclosure of any such information
   
                  (i)  to the extent required by statute, rule,
             regulation, or judicial process;
   
                  (ii) to governmental authorities, or representatives
             thereof, or regulatory personnel, auditors, or
             accountants;
   
                  (iii) in connection with any litigation to which
             any one or more of the Parties or an Affiliate is a
             party;
   
                  (iv) to counsel for any of the Parties; or
   
                  (v)  to a subsidiary or Affiliate of such Party;
   
   in the case of Sections 13.3(b)(i), (ii), and (iii), if such person
   to whom such confidential information is given is notified that
   such information is confidential, and in the case of Sections
   13.3(b)(iv) and (v) if such person to whom such confidential
   information is given agrees to be subject to the same strictures on
   disclosure as are set forth in this Agreement.
   
             (c)  In the event that any Party receives a request to
   disclose any non-public information of another Party under a
   subpoena or judicial or administrative order, such Party shall, to
   the extent not prohibited by law or such legal process,
   
                  (i)  notify the other Parties thereof within ten
             (10) days after receipt of such request;
   
                  (ii) consult with the other Parties, on the
             advisability of taking steps to resist or narrow such
             request and cooperate with the other Parties in resisting
             such disclosure, if requested; and
   
                  (iii) if disclosure is required or deemed
             advisable, cooperate with the other Parties in any
             attempt that it may make to obtain an order or other
             reliable assurance that confidential treatment will be
             accorded to designated portions of the non-public
             information.
   
        SECTION 13.4.  Specific Performance
   
             Each of the Parties acknowledges that money damages would
   not be a sufficient remedy for any breach of this Agreement for
   failure to close and that irreparable harm would result if this
   Agreement were not specifically enforced.  Therefore, if any Party
   intentionally fails to take any action required to be taken by it
   under the terms of this Agreement, the rights and obligations of
   the Parties under this Agreement shall be enforceable by a decree
   of specific performance issued by any court of competent
   jurisdiction, and appropriate injunctive relief may be applied for
   and granted in connection therewith.  A Party's right to specific
   performance shall be in addition to all other legal or equitable
   remedies available to such Party.
   
        SECTION 13.5.  Expenses
   
             Each Party hereto shall bear its own expenses, including
   the fees of any attorneys, accountants, or others engaged by such
   Party, in connection with this Agreement and the transactions
   contemplated hereby, except as otherwise expressly provided herein.
   
        SECTION 13.6.  Notices
   
             All notices, requests, demands, consents, approvals,
   agreements, or other communications to or by a Party to this
   Agreement shall:
   
             (a)  be in writing addressed to the authorized address of
   the recipient set out in this Section 13.6 or to such other address
   as it may have notified the sender;
   
             (b)  be signed by an authorized officer of the sender;
   and
   
             (c)  be delivered in person or sent by registered or
   certified mail return receipt requested or facsimile transmission
   and be deemed to be duly given or made:
   
                  (i)  in the case of delivery in person when
             delivered to the recipient at such address; or
   
                  (ii) in the case of facsimile transmission when
             received in legible form by the recipient at such address
             and when the recipient has been requested to acknowledge
             receipt of the entire facsimile transmission upon the
             sending or receiving the acknowledgment of receipt (which
             acknowledgment the recipient will promptly give);
   
   but if such delivery or dispatch is later than 5:00 pm local time
   on a day on which business is generally carried on in the place to
   which such communication is sent or occurs on a day on which
   business is not generally carried on in the place to which such
   communication is sent, it will be deemed to have been duly given or
   made at the commencement of business on the next day on which
   business is generally carried on in that place.
   
        Notices to Purchaser may be sent to
   
             Jefferson-Pilot Corporation
             P.O. Box 21008
             Greensboro, North Carolina 27420
             Attention: Chief Financial Officer
             Telephone No: (910) 691-3441
             Facsimile No:  (910) 691-3283
   
        with a copy to:
   
             Jefferson-Pilot Corporation
             P.O. Box 21008
             Greensboro, North Carolina 27420
             Attention: General Counsel
             Telephone No: (910) 691-3308
             Facsimile No:  (910) 691-3639
   
             King & Spalding
             120 West 45th Street
             New York, New York 10036
             Attention: E. William Bates, II, Esq.
             Telephone No:  (212) 556-2100
             Facsimile No:   (212) 556-2222
   
   Notices to Seller and Parent may be sent to
   
             Household International, Inc.
             2700 Sanders Road
             Prospect Heights, Illinois 60070
             Attention: Office of the Secretary
             Telephone No: 708-564-5000
             Facsimile No: 708-205-7536
   
   with a copy to:
   
             Russell J. Bruemmer, Esq.
             Wilmer, Cutler & Pickering
             2445 M Street, N.W.
             Washington, D.C.  20037-1420
             Telephone No:  202-663-6804
             Facsimile No:  202-663-6363
   
        SECTION 13.7.  Severability
   
             If any one or more of the provisions of this Agreement
   shall be held to be invalid, illegal, or unenforceable, the
   validity, legality and enforceability of the remaining provisions
   of this Agreement shall not be affected thereby.  To the extent
   permitted by applicable law, each Party hereto waives any provision
   of law which renders any provision of this Agreement invalid,
   illegal, or unenforceable in any respect, unless material to the
   purpose of this Agreement.
   
        SECTION 13.8.  Assignment
   
             This Agreement and all of the provisions hereof shall be
   binding upon and inure to the benefit of the Parties hereto and
   their respective successors and permitted assigns, but neither this
   Agreement nor any of the rights, interests, or obligations
   hereunder shall be assigned by either of Sellers or Purchaser
   hereto without the prior written consent of the other Parties, nor
   is this Agreement intended to confer upon any other person except
   the Parties any rights or remedies hereunder; provided that
   Purchaser may assign all or any portion of its respective rights,
   interests or obligations hereunder to an Affiliate of Purchaser
   without the prior written consent of Parent, Seller or the Company,
   provided that such assignment shall not release Purchaser from, or
   in any manner limit, Purchaser's obligations hereunder.
   
        SECTION 13.9.  Third Parties.
   
             Nothing in this Agreement is intended to confer any right
   on any person other than the Parties hereto and their respective
   successors and assigns and the persons identified in Sections 11.2
   and 11.3; nor is anything in this Agreement intended to modify or
   discharge the obligation or liability of any third person to any
   Party to this Agreement, nor shall any provision give any third
   person any right of subrogation or action over against any Party to
   this Agreement.  
   
        SECTION 13.10.  Captions
   
             The captions in this Agreement are for convenience only,
   do not form a part hereof, and do not in any way modify, interpret,
   or construe the intentions of the Parties hereto.
   
        SECTION 13.11.  Governing Law
   
             This Agreement shall be governed by the laws of the State
   of Michigan (regardless of the laws that might otherwise govern
   under applicable principles of conflicts of law).
   
        SECTION 13.12.  Choice of Forum
   
             Any judicial proceeding brought against any of the
   Parties hereto with respect to this Agreement shall be brought in
   any court of competent jurisdiction in the Eastern District of
   Michigan or Oakland County, Michigan, irrespective of where such
   Party may be located at the time of such proceeding, and by
   execution and delivery of this Agreement, each of the Parties to
   this Agreement hereby consents to the exclusive jurisdiction of any
   such court and waives any defense or opposition to such
   jurisdiction.
   
        SECTION 13.13.  WAIVER OF JURY TRIAL
   
             EACH PARTY HERETO WAIVES, TO THE FULLEST EXTENT PERMITTED
   BY APPLICABLE LAW, THE RIGHT TO TRIAL BY JURY IN ANY LEGAL
   PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
   TRANSACTIONS CONTEMPLATED HEREBY.
   
        SECTION 13.14.  Counterparts
   
             This Agreement may be executed in two or more
   counterparts, each of which shall be deemed an original but all of
   which shall constitute one and the same instrument.
   
        SECTION 13.15.  Drafting
   
             Each Party acknowledges that its legal counsel
   participated in the preparation of this Agreement.  The Parties
   therefore stipulate that the rule of construction that ambiguities
   are to be resolved against the drafting Party shall not be employed
   in the interpretation of this Agreement to favor any Party against
   the other.
   
        SECTION 13.16.  Books and Records
   
             Seller and Purchaser agree that, so long as any books,
   records, and files relating to the business, properties, assets, or
   operations of the Company or its subsidiaries, to the extent that
   they pertain to the operations of the Company or its subsidiaries
   prior to the Closing Date, remain in existence and are available,
   on and after the Closing Date each Party (at its expense) shall
   have the right to inspect and to make copies of the same at any
   time during business hours for the purpose of complying with
   regulatory requirements, meeting auditing needs, or fulfilling
   similar obligations for which such books, records, or files are
   reasonably necessary.
   
        SECTION 13.17.  Governmental Notices
   
             After Closing, Purchaser shall provide to any
   governmental or regulatory authority with jurisdiction over such
   matters, all required notices of the consummation of this
   transaction.
   
        SECTION 13.18.  Exhibits
   
             Disclosure of any fact or item in any Exhibit to this
   Agreement referenced to a particular Section of this Agreement
   shall, should the existence of the fact or item or its contents be
   relevant to any other Section, be deemed to be disclosed with
   respect to that other Section whether or not an explicit cross-
   reference appears; provided, that the nature of any matter
   disclosed by such fact or item is reasonably apparent from the
   context of the disclosed fact or item without reference to any
   collateral document.
   
             [The remainder of this page is intentionally blank]
IN WITNESS WHEREOF, the Parties hereto have executed this
   Stock Purchase Agreement as of the date first above written.
   
                                 HOUSEHOLD GROUP INC.
   
   
                                 By: ___________________________
                                       Name:
                                       Title:
   
   
                                 HOUSEHOLD INTERNATIONAL, INC.
   
   
                                 By: ______________________________
                                       Name:
                                       Title:
   
   
                                 ALEXANDER HAMILTON LIFE
                                 INSURANCE COMPANY OF AMERICA
   
   
                                 By: ______________________________
                                       Name:
                                       Title:
   
   
                                 JEFFERSON-PILOT CORPORATION
   
   
                                 By: ______________________________
                                       Name:
                                          Title:

                          ANNEX A
   
     STATEMENT OF TERMS OF AFFILIATED BUSINESS TRANSFER
   
   1.          Affiliated Business Reinsurance.  Prior to the Closing
                  Date, the Affiliated Business will be transferred from the
                  Company and First Alexander Hamilton Life Insurance
                  Company ("FAHLIC") to Hamilton National Life Insurance
                  Company ("HNLIC") and each of the Company and FAHLIC, on
                  the one hand, and HNLIC, on the other hand, will each
                  enter into an Affiliated Business Reinsurance Agreement
                  which will together provide 100% reinsurance of the
                  Affiliated Business Liabilities.  The Affiliated Business
                  Assets (including surplus assets) and Affiliated Business
                  Liabilities to be transferred in connection with such
                  Affiliated Business Reinsurance Agreements will be as
                  mutually agreed by the Parties, consistent with the
                  allocation of assets to be retained with respect to the
                  Individual Business as reflected in the Asset Allocation
                  Understanding, dated as of August 9, 1995, by and between
                  Parent and Purchaser; provided that to the extent that the
                  specific assets identified on Exhibit A-1 would not
                  otherwise be Affiliated Business Assets they will be
                  transferred to HNLIC, Parent or any subsidiary or
                  affiliate of Parent not involved in the Business, in
                  substitution for Affiliated Business Assets that are
                  reasonably acceptable to Purchaser.  The aggregate amounts
                  of assets, surplus and liabilities to be transferred will
                  be calculated consistently with the amounts shown on
                  Exhibit A-2 attached hereto (e.g., at December 31, 1994,
                  the Affiliated Business Assets to be transferred would
                  have aggregated $162.6 million and $164.7 million on a
                  statutory and GAAP basis, respectively, and the Affiliated
                  Business Liabilities to be assumed would have aggregated
                  $111.9 million and $84.5 million on a statutory and GAAP
                  basis, respectively).
   
     The Affiliated Business Reinsurance Agreements will be
        structured so as to ensure the Company's and FAHLIC's ability to
        receive proper reserve credits for the amounts ceded, including,
        if necessary to receive reserve credits, a reinsurance trust and
        Parent will undertake or cause to be undertaken any and all
        actions required for the Company and FAHLIC to so receive such
        reserve credits.  In addition, any Reinsurance Treaties relating
        to the Affiliated Business will be concurrently assigned to
        HNLIC.  HNLIC and Parent will use their best efforts to convert
        the Affiliated Business Reinsurance Agreements into agreements
        providing assumption reinsurance of the Affiliated Business
        within four years of the Closing Date; provided that on the
        fourth anniversary of the Closing Date the Affiliated Business
        Reinsurance Agreements will be converted to assumption
        reinsurance, subject to regulatory approvals and constraints. 
   
   2.          Dividend of Retained Subsidiaries.  After the execution of
                  the Affiliated Business Reinsurance Agreements, the
                  Company will distribute all outstanding capital stock in
                  the Retained Subsidiaries (including HNLIC) to Seller. 
   
   3.          New Business.  The Affiliated Business Reinsurance
                  Agreements will provide that the Company and FAHLIC will
                  continue to make their policies available to Parent and
                  its Affiliates for a maximum of 18 months, as necessary. 
                  Parent will use its best efforts to expeditiously obtain
                  necessary product approvals, agent licensing, and all
                  other licenses, authorizations and approvals necessary for
                  HNLIC to undertake the Affiliated Business, or make other
                  arrangements to discontinue sales of Affiliated Business
                  policies through the Company and FAHLIC; provided that in
                  no event will any sales be made through the Company and
                  FAHLIC more than 18 months following the Closing Date. 
                  The Company and FAHLIC will be reimbursed for all premium
                  taxes, and for each of the 18 months following the Closing
                  Date, the Company will receive a noncancellable fee of
                  $150,000 per month.  In addition, beginning January 1,
                  1996, the Company and FAHLIC will charge a fee equal to 2%
                  of premiums on new business written.
   
   4.          Employee Matters.  The Parties agree to work together to
                  make an appropriate and fair allocation of employees to
                  the Affiliated Business with primary consideration given
                  to historical employee relationships and cost allocations. 
                  Such employees will be retained by Parent or HNLIC as of
                  the Closing Date.
   
   5.          Provision for Administrative Expenses.  The Affiliated
                  Business Reinsurance Agreements will provide for
                  reimbursement to the Company and FAHLIC for all costs
                  reasonably related to the administration of the Affiliated
                  Business.
   
   6.          Office Facilities.  Parent, or its designated subsidiary,
                  will continue to occupy and rent office space for the
                  Affiliated Business from the Company at Farmington Hills,
                  Illinois for a rent of $15.74 per square foot for a term
                  of 5 years terminable by either party at any time upon six
                  months' prior notice.  The Parties agree to work together
                  to make an appropriate and fair allocation of the office
                  equipment and other related assets historically utilized
                  in the Affiliated Business, which upon the execution of
                  the Affiliated Business Reinsurance Agreements will be
                  transferred by the Company to Parent, or its designated
                  subsidiary, "AS IS," "WHERE IS" and without representation
                  or warranty.
   
   7.          Parent Guarantee.  Parent will unconditionally guarantee
                  the payment obligations of HNLIC under the Affiliated
                  Business Reinsurance Agreements and other agreements. 
                  Purchaser agrees that Parent's guarantee may be assumed by
                  any purchaser of HNLIC and the Affiliated Business;
                  provided that such purchaser has a Standard & Poor's
                  Corporation credit rating of A or better and that the
                  assumption is evidenced by properly executed assumption
                  and guarantee documents reasonably satisfactory to
                  Purchaser.
   
   8.          Other Items.  The Affiliated Business Reinsurance
                  Agreements and any trust arrangements required hereunder
                  will comply with applicable state laws and regulations to
                  ensure proper reserve credits, including New York State
                  Insurance Regulation 144, and Parent will cause any
                  necessary action to be taken to maintain such compliance.
   
   9.          Regulatory Limitations.  In the event that HNLIC is unable
                  to reinsure 100% of the Affiliated Business Liabilities
                  originated by FAHLIC, then FAHLIC will discontinue sales
                  of Affiliated Business policies as of a date not later
                  than the 90th day after the Closing Date.
   
   
   10.         Documentation.  The form of Affiliated Business
                  Reinsurance Agreements and any documentation to be
                  executed by the Parties pursuant to this Annex A shall be
                  approved by Purchaser, such approval not to be
                  unreasonably withheld.
   
   11.         Tax Effect.  For all Tax periods ending after the Closing
                  Date, for Tax purposes the net positive and net negative
                  consideration received by the ceding and assuming
                  companies will be adjusted, if necessary, to be tax
                  neutral to the Parties on an ongoing basis, including any
                  changes in tax laws.  Purchaser or Seller, as the case may
                  be, shall consult with the other party prior to taking any
                  position or paying any Taxes that could result in an
                  adjustment under this paragraph.  Following such
                  consultation, neither party shall refuse to take any
                  reasonable position for Tax purposes that would reduce or
                  eliminate any such adjustment.
Exhibit A  
Certain Assets to be transfered to the Affiliated Business

Private Placements                   Book Value

Beaver Valley Nuclear                $ 375,351
El Paso Electric                             0
Total                                $375, 351
   
   

                          ANNEX B
   
        STATEMENT OF TERMS OF COLI BUSINESS TRANSFER
   
   
   1.     COLI Business Reinsurance.  Prior to the Closing Date, the COLI
             Business will be transferred from the Company to Hamilton
             National Life Insurance Company ("HNLIC"), and the Company and
             HNLIC will enter into the COLI Business Reinsurance Agreement
             that will provide 100% reinsurance of the COLI Business
             Liabilities.  The COLI Business Assets (including surplus
             assets) and the COLI Business Liabilities to be transferred in
             connection with such COLI Business Reinsurance Agreement will be
             as mutually agreed by the Parties, consistent with the
             allocation of assets, to be retained with respect to the
             Individual Business as reflected in the Asset Allocation
             Understanding, dated as of August 9, 1995, by and between Parent
             and Purchaser.  The aggregate amount of assets, surplus and
             liabilities to be transferred will be calculated consistently
             with the amounts shown on Exhibit B-1 attached hereto (e.g., at
             December 31, 1994, the COLI Business Assets to be transferred
             would have aggregated $517.9 million on a statutory and GAAP
             basis, and the COLI Business Liabilities to be assumed would
             have aggregated $516.9 million and $502.1 million on a statutory
             and GAAP basis, respectively). 
   
     HNLIC and Parent will use their best efforts to convert the COLI
        Business Reinsurance Agreement into an agreement providing
        assumption reinsurance of the COLI Business with an insurer that
        has a claims paying rating of A+ or better by Standard & Poor's
        Corporation ("S&P") within three years of the Closing Date or,
        alternatively, at its sole option HNLIC may replace all of the
        COLI Business with substitute issued policies within such time
        period; provided that with the prior written consent of the
        Company, not to be unreasonably withheld, HNLIC may designate up
        to two COLI Business cases to be excluded from such assumption
        reinsurance agreement or substitute insurance arrangements. 
        Parent will, from time to time, take any action as is necessary
        to cause HNLIC to meet the minimum capital and surplus standards
        of paragraphs 6 and 7, below.  Concurrently with the
        distribution of the capital stock of HNLIC to Seller, the
        Company will transfer to HNLIC the COLI Business Assets.
    
   2.     Dividend of HNLIC.   After the execution of the COLI Business
             Reinsurance Agreement, the Company will distribute all
             outstanding capital stock in HNLIC to Seller.
   
   3.     Provision for Administrative Expenses.  The COLI Business
             Reinsurance Agreement will provide for reimbursement to the
             Company for all costs reasonably related to its administration
             of the COLI Business.
   
   4.     Provision for Cost of Capital.  The Company will receive the
             following annual compensation on the statutory reserves ceded
             relating to the COLI Business, as determined at the end of each
             quarter:
   
               17.5 basis points for the first three years after
                  the Closing Date;
               20 basis points for the fourth year after the
                  Closing Date; and
               35 basis points for each following year after the
                  fourth year after the Closing Date; and
   
   Notwithstanding the foregoing, the annual compensation shall be 17.5
   basis points for all years after the Closing Date with respect to
   statutory reserves relating to any COLI Business cases (not to exceed
   2 COLI Business cases) excluded from the assumption reinsurance or
   substitute insurance arrangement described in Section 1 above.
   
   5.     Investment Guidelines for Trust Assets.  The Company will have a
             continuing interest in the quality of the COLI Business Assets
             acquired and held by HNLIC to satisfy the COLI Business
             Liabilities during the time period the COLI Business Reinsurance
             Agreement is in effect.  The COLI Business Assets will be held
             in trust by an unaffiliated third party for the benefit of the
             Company pursuant to a trust agreement (the "Trust Agreement")
             and will be invested in accordance with the following guidelines
             (all references to credit ratings are to S&P ratings):
   
     (i)  Authorized New Investments (which are not subject to an
             aggregate limitation)
   
               US Treasury and Agency obligations
               Public corporate bonds (investment grade only)
               Agency mortgage-backed securities and CMOs
               Rated residential whole-loan CMOs (AAA, AA, or A)
               Rated private placements (investment grade only)
               Other rated asset-backed securities ("ABS"),
                  including commercial mortgage-backed securities (AAA
                  or AA)
   
     (ii) Authorized New Investments (which are subject to an
             aggregate "basket" limitation of not more than 10% of the
             COLI Business Investment portfolio (excluding the amount
             of policy loans))
   
               Commercial mortgages
               Common stock
               Commercial mortgage-backed securities
               Any other investment authorized under insurance
                  codes (except prohibited investments)
   
     (iii)     Prohibited New Investments
   
          No investment will be made in:
   
               Equity real estate
               Affiliated entity obligations, except for the ABS
                  set out in (i) above
   
     (iv) Individual Credit Exposure Limits
   
               Direct US Government obligations - unlimited
               A rated and higher credits (including MBS/CMO) - $25
                  million
               BBB3 - BBB1 rated credits - $15 million
               Noninvestment grade assets - $5 million
               All basket and noninvestment grade assets - $5
                  million
   
     (v)  Portfolio Characteristics
   
               Fixed-income holdings rated below A cannot exceed
                  25% of portfolio (excluding the amount of policy
                  loans).
               Mortgage-backed securities, including CMOs and ABSs,
                  cannot exceed 30% of portfolio (excluding the amount
                  of policy loans).
   
     Exceptions or changes to the investment limitations will require
        the Company's prior written consent.
   
   6.     Minimum Capital and Surplus Requirements.  The Trust Agreement
             will have adequate provisions to ensure that HNLIC will maintain
             sufficient COLI Business Assets and other assets in the Trust to
             entitle the Company to take full financial statement credit for
             the COLI Business Reinsurance Agreement in all states and Parent
             will undertake or cause to be undertaken any and all actions
             necessary for the Company to so receive such reserve credits. 
             In order to maintain the Company's policyholder ratings, HNLIC
             will maintain a Risk Based Capital Ratio of at least 150% of
             Company Action Level Risk Based Capital.  Accordingly, pursuant
             to paragraph 7 below, Parent will be obligated to take any
             action necessary to maintain a Risk Based Capital Ratio of at
             least 150% of Company Action Level Risk Based Capital at all
             times under then applicable law.
   
   7.     Periodic Cash Flow Testing of Reserves.  HNLIC will perform
             annual cash flow testing for the COLI Business using appropriate
             actuarial Standards of Practice, as promulgated by the American
             Academy of Actuaries, and in compliance with then current NAIC
             regulations.  Provision will be made for a second expert
             actuarial opinion and reconciliation in the event the Company
             disagrees with HNLIC's calculation.  To the extent that this
             testing indicates the reserves are inadequate, Parent or HNLIC
             will take any action necessary to maintain adequate reserves.
   
   8.     Parent Guarantee.  In addition to its capital maintenance
             obligations, Parent will unconditionally guarantee the payment
             obligations of HNLIC under the COLI Business Reinsurance
             Agreement, and 
   
     A.   In the event of (i) a decline at any time in the
             consolidated net worth of Parent below $1.5 billion, as
             determined in accordance with GAAP or (ii) a change in
             control of Parent or HNLIC, then Parent will be obligated
             to take any action necessary so that HNLIC increases, and
             maintains, a Risk Based Capital Ratio to at least 250% of
             Company Action Level Risk Based Capital; provided that if
             within 90 days of either event such Risk Based Capital
             Ratio has not otherwise been increased in accordance with
             this paragraph A, the Company will have the right to
             terminate the COLI Business Reinsurance Agreement, by
             recapturing the COLI Business Assets and the COLI Business
             Liabilities at a price agreed by Parent and the Company or
             at the fair market value as determined through arbitration
             by an actuarial or accounting firm, satisfactory to Parent
             and the Company, or an actuarial or accounting firm
             selected by firms selected by each of Parent and the
             Company, it being understood that the price will be first
             determined and then the Company will have 90 days from the
             date of such determination in which to exercise such
             option.  
   
     B.   In the event that HNLIC's Risk Based Capital Ratio is
             below 150% of Company Action Level Risk Based Capital for
             90 days, the Company will have the right to terminate the
             COLI Business Reinsurance Agreement, by recapturing the
             COLI Business Assets and the COLI Business Liabilities at
             a price agreed by Parent and the Company or at the fair
             market value as determined through arbitration by an
             actuarial or accounting firm, satisfactory to Parent and
             the Company, or an actuarial or accounting firm selected
             by firms selected by each of Parent and the Company, it
             being understood that the price will be first determined
             and then the Company will have 90 days from the date of
             such determination in which to exercise such option.
   
     C.   In the event that Parent has an S&P credit rating less
             than BBB-, Parent and the Company will agree to, or
             determine through arbitration by an actuarial or
             accounting firm, satisfactory to Parent and the Company,
             or an actuarial or accounting firm selected by firms
             selected by each of Parent and the Company, the fair
             market value of the COLI Business Assets and the COLI
             Business Liabilities.  To the extent that the value of the
             COLI Business Liabilities exceeds the value of the COLI
             Business Assets, Parent will transfer assets to the Trust
             satisfactory to the Company with a fair market value equal
             to such difference or arrange for a letter of credit for
             150% of such difference to be issued by a financial
             institution with an S&P credit rating of at least A, for
             the benefit of the Trust; provided that if within 90 days
             of such event Parent has not provided such assets or
             letter of credit, to the extent required, the Company will
             have the right to terminate the COLI Reinsurance
             Agreement, by recapturing the COLI Business Assets and the
             COLI Business Liabilities at a price agreed by Parent and
             the Company or at the fair market value as determined
             through arbitration by an actuarial or accounting firm,
             satisfactory to Parent and the Company, or an actuarial or
             accounting firm selected by firms selected by each of
             Parent and the Company, it being understood that the price
             will be first determined and then the Company will have 90
             days from the date of such determination in which to
             exercise such option.  At the end of each 12 month period
             commencing on the date of such determination pursuant to
             the first sentence of this paragraph C, and on each
             anniversary date thereof thereafter in which Parent's S&P
             credit rating is less than BBB-, Parent and the Company
             will value the COLI Business Assets and the COLI Business
             Liabilities and, if determined to be necessary, Parent
             will transfer assets satisfactory to the Company with a
             fair market value equal to such difference or arrange for
             a letter of credit in the same manner as described above;
             with the Company having a new option to terminate the COLI
             Business Reinsurance Agreement as described above if
             Parent does not provide such assets or letter of credit as
             provided above; provided that for the purpose of the
             foregoing calculation, the COLI Business Assets will not
             include the amount of any letter of credit then in effect;
             and provided, further that any letter of credit then in
             effect will remain in the Trust and in effect until the
             completion of the subsequent determination and the
             substitution of a new letter of credit in the Trust to the
             extent required.
   
          The guarantee of Parent provided hereunder will terminate
             to the extent, and at the time, of the assumption
             reinsurance or substitution of COLI Business cases in
             accordance to Section 1 above. 
   
   9.     Company Option to Terminate COLI Business Reinsurance Agreement. 
             The Company will have the right to terminate the COLI Business
             Reinsurance Agreement on the seventh anniversary of the Closing
             Date, by recapturing the COLI Business Assets and the COLI
             Business Liabilities at a price agreed by Parent and the Company
             or at the fair market value as determined through arbitration by
             an actuarial or accounting firm, satisfactory to Parent and the
             Company, or an actuarial or accounting firm selected by firms
             selected by each of Parent and the Company.
   
   10.    Reimbursement for Benefit Payments.  All benefit payments will
             be made by direct check or draft on HNLIC's bank accounts.    
   
   11.    Other Items.  The Trust Agreement and COLI Business Reinsurance
             Agreement will comply with applicable state laws and regulations
             to ensure proper reserve credits, including New York State
             Insurance Regulation 144, and Parent will cause any necessary
             actions to be taken to maintain such compliance.
   
   12.    Documentation.  The form of the COLI Business Reinsurance
             Agreement, the Trust Agreement and any documentation to be
             executed by the Parties pursuant to this Annex B shall be
             approved by Purchaser, such approval not to be unreasonably
             withheld.
   
   13.    Tax Effect.  For all tax periods ending after the Closing Date,
             for Tax purposes the net positive and net negative consideration
             received by the ceding and assuming companies will be adjusted,
             if necessary, to be tax neutral to the Parties on an ongoing
             basis, including any changes in tax laws.  Purchaser or Seller,
             as the case may be, shall consult with the other party prior to
             taking any position or paying any Taxes that could result in an
             adjustment under this paragraph.  Following such consultation,
             neither party shall refuse to take any reasonable position for
             Tax purposes that would reduce or eliminate any such adjustment.
   

Exhibit B-1, reference exhibit A-1

   ANNEX C
   
          STATEMENT OF TERMS OF PPA BUSINESS TRANSFER
   
   
   1.     PPA Business Reinsurance.  Prior to the Closing Date, the PPA
Business will be transferred from the Company to AHLIC-AZ and PIC,
and the Company, on the one hand, and AHLIC-AZ and PIC, on the other
hand, will enter into PPA Business Reinsurance Agreements which will
together provide 100% reinsurance of the PPA Business Liabilities. 
The PPA Business Assets (including surplus assets) and PPA Business
Liabilities to be transferred in connection with such PPA Business
Reinsurance Agreements will be, as mutually agreed by the Parties,
consistent with the allocation of assets to be retained with respect
to the Individual Business as reflected in the Asset Allocation
Understanding dated as of August 9, 1995, by and between Parent and
Purchaser.
   
     The aggregate amounts of assets, surplus and liabilities to be
     transferred will be calculated consistently with the amounts shown
     on Exhibit C-1 attached hereto (e.g., at December 31, 1994, the PPA
     Business Assets to be transferred would have aggregated $1,555.6
     million and $1,532.1 million on a statutory and GAAP basis,
     respectively, and the PPA Business Liabilities to be assumed would
     have aggregated $1,505.1 million and $1,366.4 million on a statutory
     and GAAP basis, respectively).  Parent will, from time to time, take
     any action as is necessary to cause the PPA Companies to meet the
     minimum capital and surplus standards of paragraphs 7 and 8, below. 
     Concurrently with the distribution of the capital stock of the PPA
     Companies to Seller, the Company will transfer to the PPA Companies
     the PPA Business Assets.
   
  2.     Dividend of PPA Companies.  After the execution of the PPA Business
         Reinsurance Agreements, the Company will distribute all outstanding
         capital stock in the PPA Companies to Seller. 
   
   3.     New Business.  During the term of the PPA Business Reinsurance
          Agreements the PPA Companies will not initiate any new sales or
          incur any new insurance obligations and will not conduct any other
           business; provided that, solely for the purpose of, and in the
           amounts necessary for, maintaining life insurance company status,
          the PPA Companies may reinsure other blocks of business other than
          through the Trust so long as the PPA Companies, after entering into
            any such reinsurance arrangements, continue to comply with the
            requirements hereof.
   
  4.    Provision for Administrative Expenses.  The PPA Business Reinsurance
          Agreement will provide for reimbursement to the Company for all
         costs reasonably related to its administration of the PPA Business.
  
   
   5.     Provision for Cost of Capital.  The Company will receive annual
             compensation of 21 basis points on the statutory reserves ceded
             relating to the PPA Business, as determined at the end of each
             quarter. 
   
   6.     Investment Guidelines for Trust Assets.  The Company will have a
             continuing interest in the quality of the PPA Business Assets
         acquired and held to satisfy the PPA Business Liabilities.  The PPA
         Companies' assets will be held in trusts by an unaffiliated third
           party for the benefit of the Company pursuant to trust agreements
        (the "Trust Agreements") and will be invested in accordance with the
            following guidelines (all references to credit ratings are to
             Standard & Poor's Corporation ("S&P") ratings):
   
     (i)  Authorized New Investments (which are not subject to an
             aggregate limitation)
   
               US Treasury and Agency obligations
               Public corporate bonds (investment grade only)
               Agency mortgage-backed securities and CMOs
               Rated residential whole-loan CMOs (AAA, AA, or A)
               Rated private placements (investment grade only)
               Other rated asset-backed securities ("ABS"), including
                  commercial mortgage-backed securities (AAA or AA)
   
     (ii) Authorized New Investments (which are subject to an aggregate
             "basket" limitation of not more than 10% of the PPA Business
             Investment portfolio)
   
               Commercial mortgages
               Common stock
               Commercial mortgage-backed securities
               Any other investment authorized under insurance codes
                  (except prohibited investments)
   
     (iii)     Prohibited New Investments
   
          No investment will be made in:
   
               Equity real estate
               Affiliated entity obligations, except for the ABS set
                  out in (i) above
   
     (iv) Individual Credit Exposure Limits
   
               Direct US Government obligations - unlimited
               A rated and higher credits (including MBS/CMO) - $25
                  million
               BBB3 - BBB1 rated credits - $15 million
               All basket and noninvestment grade assets - $5 million
               Noninvestment grade assets - $5 million
   
     (v)  Portfolio Characteristics
   
               Fixed-income holdings rated below A cannot exceed 25% of
                  portfolio.
               Mortgage-backed securities, including CMOs and ABSs,
                  cannot exceed 30% of portfolio.
   
     Exceptions or changes to the investment limitations will require the
        Company's written consent.
   
   7.     Minimum Capital and Surplus Requirements.  The Trust Agreements will
          have adequate provisions to ensure that the PPA Companies will
          maintain sufficient PPA Business Assets and other assets in the
          Trusts to entitle the Company to take full financial statement
          credit for the PPA Business Reinsurance Agreements in all states and
          Parent will undertake or cause to be undertaken any and all actions
          required for the Company to so receive such reserve credits.  In
          order to maintain the Company's policyholder ratings, each of the
          PPA Companies will maintain a Risk Based Capital Ratio of at least
          150% of Company Action Level Risk Based Capital.  Accordingly,
          pursuant to paragraph 8 below, Parent will be obligated to take any
          action necessary to maintain a Risk Based Capital Ratio of at least
          150% of Company Action Level Risk Based Capital at all times under
          then applicable law. 
   
   8.     Periodic Cash Flow Testing of Reserves.  The PPA Companies will
          perform annual cash flow testing for the PPA Business using
          appropriate actuarial Standards of Practice, as promulgated by the
          American Academy of Actuaries, and in compliance with then current
          NAIC regulations.  Provision will be made for a second expert
          actuarial opinion and reconciliation in the event the Company
          disagrees with the PPA Companies' calculation.  To the extent that
          this testing indicates the reserves are inadequate, Parent, AHLIC-AZ
          or PIC would take any action necessary to maintain adequate
          reserves.  
   
   9.     Parent Guarantee.  In addition to the capital maintenance
          obligations, Parent will unconditionally guarantee the payment
          obligations of the PPA Companies under the PPA Business Reinsurance
          Agreements, and: 

     A.   In the event of (i) a decline at any time in the consolidated
          net worth of Parent below $1.5 billion, as determined in
          accordance with GAAP or (ii) a change in control of Parent or
          either of the PPA Companies, then Parent will be obligated to
          take any action necessary so that each of the PPA Companies
          increases, and maintains, its Risk Based Capital Ratio to at
          least 250% of Company Action Level Risk Based Capital;
          provided that if within 90 days of either event such Risk
          Based Capital Ratio has not otherwise been increased in
           accordance with this paragraph A, the Company will have the
          right to terminate the PPA Business Reinsurance Agreements, by
          recapturing the PPA Business Assets and the PPA Business
          Liabilities at a price agreed by Parent and the Company or at
          the fair market value as determined through arbitration by an
          actuarial or accounting firm, satisfactory to Parent and the
          Company, or an actuarial or accounting firm selected by firms
          selected by each of Parent and the Company, it being
          understood that the price will be first determined and then
          the Company will have 90 days from such determination in which
          to decide whether to exercise such option. 
   
     B.   In the event that either of the PPA Companies' Risk Based
          Capital Ratio is below 150% of Company Action Level Risk Based
          Capital for 90 days, the Company will have the right to
          terminate the PPA Business Reinsurance Agreements, by
          recapturing the PPA Business Assets and the PPA Business
          Liabilities at a price agreed by Parent and the Company or at
          the fair market value as determined through arbitration by an
          actuarial or accounting firm, satisfactory to Parent and the
          Company, or an actuarial or accounting firm selected by firms
          selected by each of Parent and the Company, it being
          understood that the price will be first determined and then
          the Company will have 90 days from such determination in which
          to decide whether to exercise such option. 
       C.   In the event that Parent has a credit rating less than BBB-,
             Parent and the Company will agree to, or determine through
             arbitration by an actuarial or accounting firm, satisfactory
             to Parent and the Company, or an actuarial or accounting firm
             selected by firms selected by each of Parent and the Company,
             the fair market value of the PPA Business Assets and the PPA
             Business Liabilities.  To the extent that for either PPA
             Company the value of the PPA Business Liabilities exceeds the
             value of the PPA Business Assets allocable to such entity,
             Parent will transfer assets to the related Trust satisfactory
             to the Company with a fair market value equal to such
             difference or arrange for a letter of credit for 150% of such
             difference to be issued by a financial institution with a S&P
             credit rating of at least A, for the benefit of such Trust;
             provided that if within 90 days of such event Parent has not
             provided such assets or  letter of credit to the extent
             required, the Company will have the right to terminate the PPA
             Reinsurance Agreements, by recapturing the PPA Business Assets
             and the PPA Business Liabilities at a price agreed by Parent
             and the Company or at the fair market value as determined
             through arbitration by an actuarial or accounting firm,
             satisfactory to Parent and the Company, or an actuarial or
             accounting firm selected by firms selected by each of Parent
             and the Company, it being understood that the price will be
             first determined and then the Company will have 90 days from
             such determination in which to decide whether to exercise such
             option.  At the end of each 12 month period commencing on the
             date of the determination pursuant to the first sentence of
             this paragraph C, and on each anniversary date thereof
             thereafter in which Parent's S&P credit rating is less than
             BBB-, Parent and the Company will value the PPA Business
             Assets and the PPA Business Liabilities and if determined to
             be necessary, Parent will transfer assets satisfactory to the
             Company with a fair market value equal to such difference or
             arrange for a letter of credit in the same manner as described
             above with the Company having a new option to terminate the
             PPA Business Reinsurance Agreements as described above if
             Parent does not provide such assets or letter of credit as
             provided above; provided that for the purpose of the foregoing
             calculation, the PPA Business Assets will not include the
             amount of any letter of credit then in effect; and provided,
             further that any letter of credit then in effect will remain
             in the Trust and in effect until the completion of the
             subsequent determination and the substitution of a new letter
             of credit in the Trust to the extent required.
   
 10.    Company Option to Terminate PPA Business Reinsurance Agreements. The
        Company will have the right to terminate the PPA Business
        Reinsurance Agreements on the seventh anniversary of the Closing
         Date, by recapturing the PPA Business Assets and the PPA Business
        Liabilities at a price agreed by Parent and the Company or at the
        fair market value as determined through arbitration by an actuarial
       or accounting firm, satisfactory to Parent and the Company, or an
        actuarial or accounting firm selected by firms selected by each of
       Parent and the Company; provided that Parent will be entitled to
       prevent the Company from exercising the foregoing option (to be
       exercised after agreement on, or determination of, value in the
       manner provided in paragraph 9) by increasing to 22.5 basis points
       the annual compensation the Company receives on the statutory
       reserves relating to the PPA Business.
 
   11.    Reimbursement for Benefit Payments.  All benefit payments will be
          made by direct check or draft on the PPA Companies' bank accounts. 
   
   12.    Other Items.  The Trust Agreements and the PPA Business Reinsurance
         Agreements will comply with applicable state laws and regulations to
         ensure proper reserve credits, including New York State Insurance
         Regulation 144 and Parent will cause any necessary actions to be
         taken to maintain such compliance. The transfer of the PPA Business
         to the PPA Companies will be structured in such a way as to cause
          the recapture of existing reinsurance of the PPA Business with
             Hamilton National Life Insurance Company. 
   
   13.    Documentation.  The form of PPA Reinsurance Agreements, Trust
             Agreements and any documentation to be executed by the Parties
             pursuant to this Annex C shall be approved by Purchaser, such
             approval not to be unreasonably withheld.
   
   14.    Tax Effect.  For all Tax periods ending after the Closing Date, for
          Tax purposes the net positive and net negative consideration
          received by the ceding and assuming companies will be adjusted, if
          necessary, to be tax neutral to the Parties on an ongoing basis,
          including any changes in tax laws.  Purchaser or Seller, as the case
          may be, shall consult with the other party prior to taking any
          position or paying any Taxes that could result in an adjustment
          would reduce or eliminate any such adjustment.
   
   
   
   
Exhibit C-1 (reference Exhibit A-1)