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hereinafter called the underlying limits,

and then only up to an amount not exceeding the Company's limit of liability, stated in Item 3 (A) of the Declarations, as a result of any one occurrence.

(b) In the event of reduction or exhaustion of the aggregate limits of liability under said underlying insurance by reason of losses paid thereunder, this policy shall, subject to the terms and conditions of the underlying insurance,

(1) in the event of reduction, pay the excess of the reduced underlying insurance,

or

(2) in the event of exhaustion, continue in force as underlying insurance.

(c) The Company's total limit of liability shall not exceed the amount stated in Item 3 (B) of the Declarations on account of all occurrences happening during each annual period commencing with the effective or anniversary date of this policy separately with respect to,

(1) payments made hereunder as losses by reason of the reduction or exhaustion of the aggregate limits of liability under the underlying insurances or,

(2) Products Liability, (if not subject to subsection (c) (1) above) or,

(3) Personal Injuries (fatal or non-fatal) by Occupational Disease sustained by any employee of the Insured (if not subject to subsection (c) (1) above) or,

(4) Occurrences not covered by underlying insurance (if not subject to subsection (c) (1) above)

3. Policy Period - Territory

This policy applies only to occurrences happening during the policy period anywhere in the world.

DEFINITIONS

98-03 N. Y. - METRO.

1. Named Insured and Insured

(a) The words "Named Insured" wherever used in this policy includes, while operating as such, any subsidiary of the Named Insured and any other entity coming under the Named Insured's control over which it assumes active management.

(b) The unqualified word "Insured", wherever used in this policy, includes not only the Named Insured but also,