
<PAGE>   1
                                                                Exhibit 11(b)(1)

Stagecoach Holdings PLC,
Charlotte House,
20 Charlotte Street,
Perth PH1 5LL,
Scotland

Attention: Mr Keith Cochrane
Finance Director                                                   12 June, 1999

Dear Keith,



                               PROJECT LACHLAN II

         We, the undersigned, are writing to confirm that we have committed, in
the proportions set out below, to underwrite and arrange for you the loan
facilities necessary for the purchase of Court on the terms set out in the Term
Sheet which you and we have signed today. We have seen and approved the terms of
the tender offer as set out in the Press Release, which we understand you will
make today.

         In addition, this commitment is subject to the negotiation and
execution of satisfactory facility and guarantee documentation on conditions
which will substantially reflect those set out in this letter and the above Term
Sheet. We agree to negotiate such documentation in good faith with the intention
that it is signed on or before Wednesday 23 June, 1999.


<TABLE>
<CAPTION>
BANK                                                  AGREED COMMITMENTS
<S>                                                   <C>
Credit Suisse First Boston                            US$ 610,000,000
J.P. Morgan Securities Ltd.                           US$ 610,000,000
The Royal Bank of Scotland plc                        US$ 610,000,000
The Governor and Company of the Bank of Scotland      US$ 420,000,000
</TABLE>
<PAGE>   2
                                Yours faithfully,

<TABLE>
<S>                         <C>                         <C>
/s/                            /s/                          /s/
 ...................................................................................
   for and on behalf of        for and on behalf of         For and on behalf of
CREDIT SUISSE FIRST BOSTON  CREDIT SUISSE FIRST BOSTON  J.P. MORGAN SECURITIES LTD.
</TABLE>

/s/                            /s/
 ................................................................................
   for and on behalf of        For and on behalf of
      THE ROYAL BANK      THE GOVERNOR AND COMPANY OF THE
      OF SCOTLAND PLC            BANK OF SCOTLAND
<PAGE>   3
                               PROJECT LACHLAN II

                           US$ 2,250,000,000 FACILITY

                          SUMMARY OF TERMS & CONDITIONS

Borrowers:                 Street Holdings plc (the "Parent") and specified
                           wholly-owned subsidiaries of the Parent. To the
                           extent borrowers will be US companies, US regulatory
                           provisions will be required.

                           [NB:  Arthur Andersen working on tax structure]

Guarantors:                The Parent, any other Borrowers, Court (to the extent
                           permitted, and when permitted, by US law) and the
                           Subsidiaries of Street listed in the Appendix. The
                           cross guarantees to be released upon the raising of
                           funds in the capital markets for the repayment of
                           Tranche A in full.

Guarantee:                 On a joint and several basis.

Facility Amount:           US$ 2,250,000,000 allocated as follows:

                           Tranche A: term loan: US$1,000,000,000;

                           Tranche B: 5-year term loan: US$750,000,000;

                           Tranche C: 5-year revolving credit facility:
                           US$500,000,000.

Facility Description:      US$ denominated term and revolving credit facilities
                           available for drawing in US$ or any freely available
                           Euro-currency.

Facility Purpose:          Tranches A & B: To finance the Acquisition and to
                           refinance certain existing borrowings of Court and/or
                           Street.

                           Tranche C: To refinance certain existing borrowings
                           of Court and/or Street and for general corporate
                           purposes.

Final Maturity Date:       Tranche A: 31 December 2000.

                           Tranches B & C:  5-years from signing of the Facility
                           Agreement.

Repayment:                 Tranches A & C: Bullet repayment of amounts
                           outstanding on the Final Maturity Date.

                           Tranche B: Repayment by equal, semi-annual
                           instalments, beginning six months from the date of
                           signing.

Availability:              Upon satisfaction of conditions precedent and subject
                           to no actual or potential Event of Default and upon a
                           minimum of three
<PAGE>   4
                           business days' notice in the case of a drawing
                           denominated in US$ and upon a minimum of five
                           business days' notice in the case of a drawing
                           denominated in any other permitted currency, any
                           Borrower shall have the ability to make drawings
                           under the Facility as follows:

                           Tranche A: Available for drawing until 31 January
                           2000

                           Tranche B: Available for drawing until to 31 January
                           2000

                           Tranche C: US$250,000,000 available for drawing on a
                           revolving basis at any time during the life of the
                           facility and the remaining US$250,000,000 available
                           for drawing on a revolving basis during the life of
                           the facility upon the Parent having issued new equity
                           of not less than (the equivalent of) US$500,000,000.

                           However, none of the Facility will be available
                           unless the Tender is made. Drawings will be in
                           minimum amounts of US$50,000,000 and in integral
                           multiples of US$5,000,000. Any amount of Tranches A
                           and B not drawn by the end of the availability period
                           will be automatically cancelled.

Interest Periods:          1, 3 or 6 months, at the Borrower's option, or such
                           periods as the Banks may agree. Up to one months
                           periods before completion of syndication.

Interest Rate:             The Borrower will pay interest at the London
                           Interbank Offered Rate ("LIBOR"), plus the Applicable
                           Margin and any applicable ECB costs. LIBOR will be
                           set by reference to Telerate page 3750, or if not
                           available, by Reference Banks.

Arrangers:                 Credit Suisse First Boston, J.P. Morgan Securities
                           Ltd., Royal Bank of Scotland, The Bank of Scotland.

Applicable Margin:         100bps on all Tranches while commitments are
                           outstanding under Tranche A. If the amount
                           outstanding under Tranche C exceeds US$250,000,000,
                           the Applicable Margin on all Tranches shall be
                           increased to 112.5 bps while commitments are
                           outstanding under Tranche A. If Street fails to
                           complete a new issue of shares in Street of at least
                           (the equivalent of) US$500,000,000 on or before 31
                           December 1999 the Applicable Margin on all Tranches
                           shall increase to 125bps. Grid based pricing after
                           Tranche A repaid in full based on Total Debt/EBITDA
                           on a twelve months rolling basis with reference to
                           the most recent published six-monthly financial
                           statements and according to the following schedule:

                           Total Debt/EBITDA (Applicable Margin)

                           4.00-4.50x (112.5bps)
                           3.50-4.00x (100.0bps)
                           3.00-3.50x (87.5bps)
<PAGE>   5
                           2.50-3.00x (75.0bps)

                           Default margin will be 1% above the Applicable Margin
                           set out above.

Interest Payment:          Interest will be payable at the end of each Interest
                           Period and will be calculated on the basis of the
                           actual number of days elapsed in a year of 360 days.
                           If the Interest Period is longer than six months,
                           then accrued interest will be paid on the last day of
                           each successive period of six months.

Front End Fees:            As per side letters, inclusive of co-ordination,
                           arrangement, underwriting and participation fees.

Commitment Fee:            The lower of 50% of the Applicable Margin or 40bps,
                           payable quarterly in arrears.

Voluntary Prepayment:      Upon 10 days' written notice, the Borrowers may
                           prepay without penalty all or part of the Facility at
                           any time. Prepayments will be made in a minimum
                           amount of US$50,000,000 and integral multiples of
                           US$5,000,000. If the prepayment takes place otherwise
                           than at the end of an Interest Period, the Borrower
                           will be responsible for breakage costs, if any. No
                           amount of Tranches A and B prepaid may be redrawn.
                           The Borrower shall allocate prepayments between
                           Tranches A and B.

Mandatory Prepayment:      Mandatory prepayment of the full net (i.e. after
                           expenses) proceeds will be required on:

                           (a)      The sale of material assets (including after
                                    the date of STB approval, sales by Court or
                                    any of its Subsidiaries) (size threshold to
                                    be agreed)

                           (b)      The raising of any funds in the
                                    international debt and/or equity capital
                                    markets

                           (c)      The raising of any funds in the loan market

                           at any time when any part of Tranche A is outstanding
                           or the outstanding amount of Tranche B is more than
                           $500,000,000. While commitments remain outstanding
                           under Tranche A, Mandatory Prepayment will repay
                           Tranche A in full before being applied to Tranche B.

Cancellation:              Upon 10 days' written notice, the Borrowers may
                           cancel without penalty all or part of the undrawn
                           Facility.

Conditions Precedent:      Customary for facilities of this type, including, but
                           not limited to:

                           a)       A certified copy of the constitutional
                                    documents of the Obligors;

                           b)       Copies of relevant board resolutions of the
                                    Obligors;
<PAGE>   6
                           c)       Copies of relevant consents and
                                    authorisations;

                           d)       Satisfactory legal opinions;

                           e)       There shall have been validly tendered to
                                    Street sufficient common stock of Court to
                                    enable Street to effect the Merger, without
                                    the requirement of any action by any other
                                    Court security holder, all conditions to the
                                    purchase set forth in the Tender Documents
                                    shall have been satisfied without waiver or
                                    amendment (except prior written consent of
                                    the Banks) and Street shall have accepted
                                    for purchase all such tendered common stock;

                           f)       Approval of the Tender at a general meeting
                                    of shareholders of Street together with
                                    approval of the increase in Street's share
                                    capital, if required, and the increase in
                                    Street's limit on borrowings contained in
                                    its Articles of Association, in all cases
                                    necessary to implement the Tender;

                           g)       Board approval for the Press Release (which
                                    must announce the intention to make a new
                                    issue of shares in Street of at least (the
                                    equivalent of) US$500,000,000);

                           h)       Evidence that all governmental approvals and
                                    regulatory and/or tax rulings have been
                                    obtained for the Tender, other than the
                                    approval of the STB;

                           i)       The STB shall have approved the terms of the
                                    Voting Trust and such terms shall be
                                    acceptable to the Banks;

                           j)       A copy of all Tender Documents and
                                    confirmation that there have been no
                                    amendments or waivers in relation thereto;

                           k)       A certificate from the finance director of
                                    each Obligor that full utilisation of the
                                    Facility will not breach any of that
                                    Obligor's borrowing limits;

                           l)       A letter from Oppenheimer Wolff & Donnelly
                                    to Street, in a form acceptable to the
                                    Banks, assessing the likelihood of obtaining
                                    unconditional STB approval to the merger;

                           m)       A first priority security interest in the
                                    voting trust certificates in Court.

Representations and        Customary for facilities of this type, at signing,
Warranties:                and to be repeated where appropriate on drawdown and
                           on the first day of each interest period, including,
                           but not limited to:

                           a)       The Obligors are duly constituted and
                                    validly existing, and have the power to
                                    enter into and comply with the Finance and
                                    Tender Documents;

                           b)       All relevant authorisations and consents
                                    have been obtained;

                           c)       Execution and performance of the Finance
                                    Documents and the Tender Documents will not
                                    conflict with laws, other agreements,
                                    contracts and constitutional documents of
                                    any of the Obligors;

                           d)       All necessary consents, authorisations and
                                    approvals etc. that are required for the
                                    performance of the Obligors' obligations
                                    under the Finance Documents and the Tender
                                    Documents, the Tender and the transaction
                                    generally and for
<PAGE>   7
                                    the business, have been or will be obtained
                                    and are in full force;

                           e)       The Borrowers shall use all reasonable
                                    endeavours to cause the Tender to be
                                    successful, the STB approval to be obtained
                                    and the acquisition of Court to be
                                    consummated, all at the earliest practicable
                                    times;

                           f)       The full utilisation of the Facility will
                                    not contravene any borrowing limitation on
                                    any of the Obligors, nor any law or
                                    agreement;

                           g)       Obligations of the Obligors in relation to
                                    the Facility are legally valid, binding and
                                    enforceable;

                           h)       No breach by the Obligors of any applicable
                                    laws and regulations, including
                                    environmental, or any agreements, which
                                    could have a Material Adverse Effect;

                           i)       No existing Event of Default;

                           j)       The Parent's audited, consolidated 1998/1999
                                    financial statements (the "Parent's Original
                                    Financial Statements") were prepared in
                                    accordance with UK GAAP and present a true
                                    and fair view of [or fairly represent] the
                                    Group's financial condition at the date to
                                    which they were drawn up;

                           k)       No change in the financial condition,
                                    business or operations of the Parent or the
                                    Group (including Stagecoach Porterbrook
                                    Limited and its Subsidiaries) since 30 April
                                    1999 which would have a Material Adverse
                                    Effect;

                           l)       No litigation or other proceedings current,
                                    pending or threatened which if adversely
                                    determined would have a Material Adverse
                                    Effect;

                           m)       No proceedings current, pending or
                                    threatened for the winding-up of the Parent
                                    or any Material Subsidiary;

                           n)       The Obligors' respective obligations under
                                    the Finance Documents will rank at least
                                    pari passu with all their other unsecured
                                    and unsubordinated obligations;

                           o)       No encumbrances exist over any assets of any
                                    Obligor except for those disclosed at
                                    signing or permitted as set out below;

                           p)       No stamp, registration or similar tax, or
                                    registration requirement;

                           q)       The projections for the merged businesses
                                    supplied to the Banks on or before signing
                                    have been prepared after taking due care and
                                    are based on reasonable assumptions and all
                                    information contained in the Information
                                    Memorandum, the circular to Street
                                    shareholders or supplied by the Parent is
                                    true, complete and accurate and all
                                    forecasts and projections have been prepared
                                    after taking due care and are based on
                                    reasonable assumptions;

                           r)       Year 2000 compliance;

                           s)       [Representation and warranty which will not
                                    be given at signing, it will be repeated
                                    when the others are repeated and will cease
                                    to be repeated when Tranche A is repaid in
                                    full. If
<PAGE>   8
                                    breached will prevent any drawings of
                                    Tranche C for acquisitions] The actual
                                    performance of the merged businesses is
                                    materially in accordance with, or is
                                    superior to, the projections in
                                    Representation and Warranty (q).

Undertakings:              Customary for facilities of this type, with respect
                           to the Borrower(s) and its subsidiaries, including
                           but not limited to:

                           Undertakings as to Information

                           (i)      Delivery of audited annual accounts (for
                                    Parent and Group) as soon as available, and
                                    in any event within 120 days after the end
                                    of each financial year;

                           (ii)     Delivery of six-monthly financial
                                    information (for Parent and Group) as soon
                                    as available, and in any event within 90
                                    days;

                           (iii)    Prompt notification of any actual or
                                    potential Event of Default;

                           (iv)     Prompt notification of material litigation;

                           (v)      Delivery of such other information as the
                                    Banks may reasonably request;

                           (vi)     Certificates as to compliance with financial
                                    covenants;

                           (vii)    Certificate confirming that consolidated
                                    Group accounts comply with UK GAAP; and

                           (viii)   Delivery of adjusted financial statements
                                    excluding Stagecoach Porterbrook Limited and
                                    its Subsidiaries for the purposes of the
                                    financial covenants and further
                                    reconciliation statements for the purposes
                                    of the financial covenants if UK GAAP
                                    changes.

                           General Undertakings (to be given by each Obligor)

                           (i)      The Obligors' payment obligations under this
                                    Facility will rank equally and rateably with
                                    all other unsecured and unsubordinated
                                    indebtedness;

                           (ii)     Negative Pledge: Neither any Obligor nor any
                                    Material Subsidiary shall create or have
                                    outstanding any security or other
                                    encumbrance on or over any of its assets to
                                    secure any of its present or future
                                    borrowings except for:

                                    -        Any security existing at the date
                                             of the Facility

                                    -        Agreement disclosed in writing by
                                             any Obligor;

                                    -        Any security arising by operation
                                             of law;

                                    -        Any security arising in the
                                             ordinary course of business,
                                             provided that any such security is
                                             limited to the assets which are the
                                             subject of the relevant
                                             transaction;

                                    -        Any security in respect of
                                             Financial Indebtedness, provided
                                             that the aggregate outstanding
                                             amount
<PAGE>   9
                                             secured under this exception shall
                                             not at any time exceed an amount
                                             equal to 5% of the share capital
                                             and reserves of the Parent, as
                                             provided in its most recent audited
                                             accounts, and

                                    -        Any security created or outstanding
                                             with the prior consent of the
                                             Majority Banks;

                           (iii)    No guarantees to third parties (including to
                                    Stagecoach Porterbrook Limited and its
                                    Subsidiaries) to be provided by Material
                                    Subsidiaries until Tranche A has been repaid
                                    in full and Street has completed a new issue
                                    of Street shares of at least (the equivalent
                                    of) US$500,000,000 and thereafter such
                                    guarantees not to exceed US$25,000,000;

                           (iv)     No disposal by sale, transfer, lease or
                                    otherwise of all or any part of its assets,
                                    except in the ordinary course of trading or
                                    at arm's length and on normal commercial
                                    terms or as agreed by the Majority Banks;

                           (v)      Acquisitions of companies or shares in
                                    companies (other than short-term minority
                                    investments) or businesses or parts of
                                    businesses restricted to US$125,000,000 in
                                    aggregate until Street has issued new equity
                                    of (the equivalent of) at least
                                    US$500,000,000 and then restricted to
                                    US$250,000,000 in aggregate until Tranche A
                                    has been repaid in full and STB has granted
                                    its consent to the Acquisition, following
                                    the issue of new equity by Street described
                                    above. Such acquisitions will be limited to
                                    companies or shares in companies in the bus,
                                    rail and aviation sectors only;

                           (vi)     No material change in the nature of any
                                    Obligors' or any Material Subsidiary's
                                    business;

                           (vii)    Maintaining compliance with all relevant
                                    laws and regulations;

                           (viii)   Parent will obtain the prior approval of the
                                    Banks1 with respect to the contents of the
                                    Tender Documents before they are dispatched
                                    to Street shareholders or Court stockholders
                                    or filed or otherwise made public and with
                                    respect to submissions to STB before they
                                    are made;

                           (ix)     Parent will not, without the consent of the
                                    Banks(1):

                                    -        Vary or waive any term of the
                                             Tender

                                    -        Treat any condition of the Tender
                                             as having been waived

                                    -        Increase the cash portion of
                                             consideration offered to Court
                                             stockholders above the figure
                                             agreed between the Borrower and the
                                             Banks

                                    -        Change the way in which the cash
                                             consideration is funded


(1) Initially the Arrangers; if facility syndicated further- Special Majority
Banks.
<PAGE>   10
                           (x)      Parent will keep the Agent informed of all
                                    material developments in relation to the
                                    Tender;

                           (xi)     Parent will co-operate fully with the
                                    Arrangers in the syndication process to
                                    ensure a successful outcome;

                           (xii)    Neither Street nor any of its other
                                    Subsidiaries will inject funds into
                                    Stagecoach Porterbrook Limited or its
                                    Subsidiaries (whether by way of debt or
                                    equity) without the consent of Majority
                                    Banks while any amount is outstanding under
                                    Tranche A; [This point still under
                                    consideration]

                           (xiii)   Maintenance of proper insurance.

                           Financial Covenants

                           (i)      Total Debt/EBITDA;

                           (ii)     EBITDA/net int. expense; and

                           (iii)    Tangible net worth.

                           Stagecoach Porterbrook Limited and its Subsidiaries
                           will be excluded from these calculations. Covenants
                           to be tested every six-months with reference to the
                           most recent published accounts on a twelve month
                           rolling basis.

                           [Still considering treatment of any debt or capital
                           injection to Stagecoach Porterbrook Limited

Events of Default:         Events of Default shall include, but not be limited
                           to the following:

                           a)       Non-payment of principal or interest on
                                    their due date. Grace period of 3 business
                                    days' for non-payment of interest only.

                           b)       Breach of representation or warranty when
                                    made or deemed repeated;

                           c)       Breach of undertaking, which, where capable
                                    of remedy, is not remedied within 10 days.
                                    Undertakings relating to the conduct of the
                                    Tender will carry no grace period;

                           d)       Any Financial Indebtedness of the Parent or
                                    its Subsidiaries (excluding Stagecoach
                                    Porterbrook Limited and its Subsidiaries)
                                    exceeding (in aggregate) US$25,000,000 (or
                                    its equivalent in any other currency)
                                    becomes due and payable or capable of being
                                    declared due and payable before its normal
                                    maturity, or is not paid when due or within
                                    any applicable grace period;

                           e)       Insolvency, winding up or enforcement
                                    proceedings of or against the Parent or any
                                    of its Material Subsidiaries, provided that
                                    such proceedings are not frivolous or
                                    vexatious;

                           f)       It is or becomes unlawful for any Obligor to
                                    comply with its obligations under the
                                    Facility;

                           g)       Litigation is current, pending or threatened
                                    against the Parent or any of its
                                    Subsidiaries which [will restrain
                                    performance of obligations under the
                                    Facility or,] if adversely determined, would
                                    have a Material Adverse Effect;

                           h)       The Parent or any of its Material
                                    Subsidiaries is unable to
<PAGE>   11
                                    pay its debts as and when they fall due;

                           i)       Any change in the financial condition or
                                    operations or prospects of the Group
                                    (including Stagecoach Porterbrook Limited
                                    and its Subsidiaries) since 30 April, 1999
                                    having a Material Adverse Effect;

                           j)       Any change in control of the Parent or,
                                    after the Tender, the merger subsidiary
                                    ceases to be a [wholly-owned] subsidiary of
                                    the Parent;

                           k)       Any of the Finance Documents ceases to be
                                    valid obligation of any Obligor;

                           l)       Any approvals or authorisations cease to be
                                    in full force and effect or Street fails to
                                    obtain STB approval and does not comply with
                                    the terms of the divestment set out in the
                                    Voting Trust.

                           Court and its Subsidiaries to be excluded from the
                           effect of Events of Default (b), (c), (d), (g) and
                           (l) for a period of 90 days after the completion of
                           the Tender.

Documentation:             The documentation will be market standard for
                           transactions of this type and will include provisions
                           for, inter alia, the following:

                           a)       Changes in circumstances, including
                                    illegality and increased costs;

                           b)       The ability of a Bank freely to transfer its
                                    rights and obligations without the consent
                                    of the Parent.

Taxation:                  All payments of principal, interest and fees will be
                           made free and clear of any deductions or
                           withholdings, levied either presently or in the
                           future. If a deduction or withholding is required the
                           Obligors will gross-up the payment.

Amendments and Waivers:    Amendments to the Facility Agreement will require the
                           approval of the Majority Banks except for the
                           following items, which will require the consent of
                           all of the Banks:

                           a)       Extension of the Final Maturity Date;

                           b)       Any change in the Interest Rate, Applicable
                                    Margin or Commitment Fee;

                           c)       Alteration of the date of payment of any
                                    sum;

                           d)       Any increase in the Facility Amount;

                           e)       Any change in the definition of Majority
                                    Banks or Special Majority Banks;

                           f)       Any change to the amendment clause;

                           g)       Any change to any clause relating to the
                                    conduct of the Tender;

                           h)       Other specified clauses.

Syndication strategy and   The Parent will provide the Arrangers with the
the role of the            necessary assistance during syndication. The Parent's
                           assistance will
<PAGE>   12
Parent:                    include providing all requested information for the
                           Information Memorandum, making management
                           presentations and if necessary hosting site visits in
                           addition to assisting with answering banks'
                           questions. The Parent will co-operate fully with the
                           Arrangers to ensure the participation of banks in
                           syndication.

                           The Arrangers reserve the right to launch syndication
                           at any time following the announcement of the Tender.

Market Conditions:         The Arrangers will use all reasonable efforts to
                           complete the syndication on the terms and conditions
                           contained herein. Subject to the Facility Amount
                           remaining unchanged, the Arrangers shall be entitled
                           to change the pricing, terms or structure of the
                           Facility if the Arrangers determines that such
                           changes are advisable in order to ensure a successful
                           syndication of the Facility. Such steps will only be
                           taken after full discussion with the Borrowers and
                           changes relating to increases in the margins shall be
                           capped at 75bps and upfront fees shall be capped at
                           25bps (in both cases, of the total Facility Amount).

                           The provisions in this paragraph shall not be
                           superseded by the terms of the Facility Agreement
                           (but shall be documented in a separate side letter)
                           and shall remain in full force and effect until
                           syndication has been completed in a manner
                           satisfactory to the Arrangers.

Clear Market:              During the period between the award of the mandate
                           and close of syndication of the Facility, neither the
                           Parent nor its subsidiaries will launch into the
                           market any bank or bond financing other than that
                           contemplated hereunder, or enter into discussions
                           with other debt providers without the prior consent
                           of the Arrangers.

Facility Agent:            Morgan Guaranty Trust Company of New York

Agency Fee:                As per side letter.

Expenses:                  All costs and expenses, including legal fees of
                           counsel acting on behalf of the Banks, reasonably
                           incurred in connection with the arrangement and
                           syndication of the Facility or in protecting their
                           rights, will be for the account of the Borrower.

Counsel to Lenders:        Slaughter and May

Governing Law:             Laws of England

Jurisdiction:              The Obligors will submit to the non-exclusive
                           jurisdiction of the courts of England

Definitions:               "Acquisition" shall mean the proposed acquisition by
                           Street of all the common stock in Court by means of
                           the Tender and Merger.
<PAGE>   13
                           "Finance Documents" shall mean the Facility Agreement
                           and the fee letters.

                           "Financial Indebtedness" shall mean:

                                    (i)      any indebtedness for monies
                                             borrowed and debit balances at
                                             banks;

                                    (ii)     any indebtedness (actual or
                                             contingent) under guarantee, bond,
                                             security, indemnity or other
                                             commitment designed to assure any
                                             creditor against loss in respect of
                                             any Financial Indebtedness of any
                                             third party;

                                    (iii)    any indebtedness under any
                                             acceptance credit;

                                    (iv)     any indebtedness under any
                                             debenture, note, bill of exchange
                                             or commercial paper;

                                    (v)      any indebtedness for money owing in
                                             respect of any interest rate swap
                                             or cross-currency swap or forward
                                             sale or purchase contract or other
                                             form of interest or currency
                                             hedging transaction;

                                    (vi)     any payment obligations under
                                             finance leases; or

                                    (vii)    any other liability (actual or
                                             contingent) in connection with
                                             amounts raised under any other
                                             transaction having the commercial
                                             effect of a borrowing or raising of
                                             money.

                           "Group" shall mean the Parent and all its
                           subsidiaries and subsidiary undertakings (including
                           Court and its subsidiaries and subsidiary
                           undertakings after the Tender).

                           "Information Memorandum" shall mean the information
                           memorandum prepared for the purpose of syndication of
                           the Facility.

                           "Majority Banks" shall mean at least 66.66% of the
                           Banks by reference to total Commitments at the
                           relevant time.

                           "Material Adverse Effect" shall mean a material
                           adverse effect on the ability of any Obligor to
                           perform its obligations under the Finance Documents.

                           "Material Subsidiary" shall mean any Subsidiary of
                           the Parent (other than Stagecoach Porterbrook Limited
                           and any Subsidiary of Stagecoach Porterbrook Limited)
                           whose consolidated turnover or gross assets represent
                           10% or more of the consolidated turnover or gross
                           assets of the Group.

                           "Merger" shall mean the proposed merger of Court and
                           a wholly-owned Subsidiary of Street.

                           "Obligors" shall mean the Borrowers and the
                           Guarantors.

                           "Press Release" shall mean the first public
                           announcement [by Street] in connection with the
                           Tender.

                           "Special Majority Banks" shall mean at least 75% of
                           the Banks by reference to total Commitments at the
                           relevant time.

                           "STB" shall mean the Surface Transportation Board.

                           "Subsidiary" shall mean a subsidiary as described in
                           section 736 of the Companies Act 1985.
<PAGE>   14
                           "Tender" shall mean the tender by [Street] for all
                           the common stock in Coach.

                           "Tender Documents" shall mean the Press Release and
                           any subsequent press release by Street relating to
                           the Tender, the offer document addressed to Court
                           stockholders and the Merger agreement (inclusion of
                           other documents in the definition to be discussed).

                           "Voting Trust" shall mean the voting trust
                           constituted by [trust document].


This offer will expire on 12 June 1999, unless extended by mutual consent.



/s/                                /s/
------------------------------     ------------------------------
for and on behalf of               for and on behalf of

CREDIT SUISSE FIRST BOSTON         J.P. MORGAN SECURITIES LTD.



/s/                                /s/
------------------------------     ------------------------------
for and on behalf of               for and on behalf of

THE ROYAL BANK OF                  THE GOVERNOR AND COMPANY OF
SCOTLAND PLC                       THE BANK OF SCOTLAND




Agreed and accepted by


/s/ Keith Cochrane
------------------------------
For and on behalf of

Stagecoach Holdings PLC



