CONFORMED AS EXECUTED

 

EXHIBIT 10.14

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SECOND AMENDED AND RESTATED CREDIT AGREEMENT

 

among

 

MBIA INC.,

 

MBIA INSURANCE CORPORATION,

 

VARIOUS DESIGNATED BORROWERS,

 

VARIOUS LENDING INSTITUTIONS,

 

KEYBANK NATIONAL ASSOCIATION,

AS SYNDICATION AGENT,

 

THE BANK OF NEW YORK,

AS DOCUMENTATION AGENT

 

AND

 

BARCLAYS BANK PLC,

AS ADMINISTRATIVE AGENT

AND LEAD ARRANGER

 

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Dated as of August 28, 1998

and

amended and restated as of April 19, 2002

and

further amended and restated as of April 16, 2003

 

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$225,000,000

 

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TABLE OF CONTENTS

 

     Page

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SECTION 1. Amount and Terms of Credit

   1

1.01 Commitment

   1

1.02 Minimum Borrowing Amounts, etc.

   2

1.03 Notice of Borrowing

   2

1.04 Competitive Bid Borrowings

   3

1.05 Disbursement of Funds

   5

1.06 Notes

   5

1.07 Conversions

   6

1.08 Pro Rata Borrowings, etc.

   6

1.09 Interest

   6

1.10 Interest Periods

   8

1.11 Increased Costs, Illegality, etc.

   9

1.12 Compensation

   11

1.13 Change of Lending Office

   11

1.14 Replacement of Lenders

   12

1.15 Recommitment; Replacement of Non-Continuing Lender

   12

1.16 Additional Commitments

   13

1.17 Designated Borrowers

   14

1.18 Retroactivity

   14

SECTION 2. Fees; Commitments

   15

2.01 Fees

   15

2.02 Voluntary Reduction of Commitments

   15

2.03 Mandatory Reduction of Commitments

   15

SECTION 3. Payments

   15

3.01 Voluntary Prepayments

   15

3.02 Mandatory Prepayments and Repayments

   16

3.03 Method and Place of Payment

   17

3.04 Net Payments

   17

SECTION 4. Conditions Precedent

   20

4.01 Conditions Precedent to the Second Restatement Effective Date

   20

4.02 Conditions Precedent to Loans

   21

SECTION 5. Representations, Warranties and Agreements

   22

5.01 Corporate Existence and Power

   22

5.02 Corporate and Governmental Authorization; No Contravention

   22

5.03 Binding Effect

   22

5.04 Financial Information

   23

 

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Table of Contents (continued)

 

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5.05 Litigation

   23

5.06 Compliance with ERISA

   23

5.07 Taxes

   23

5.08 Subsidiaries

   23

5.09 Not an Investment Company

   24

5.10 Public Utility Holding Company Act

   24

5.11 Ownership of Property; Liens

   24

5.12 No Default

   24

5.13 Full Disclosure

   24

5.14 Compliance with Laws

   24

5.15 Capital Stock

   24

5.16 Margin Stock

   24

5.17 Insolvency

   24

5.18 Ranking

   25

SECTION 6. Affirmative Covenants

   25

6.01 Information Covenants

   25

6.02 Books, Records and Inspections

   27

6.03 Maintenance of Existence

   27

6.04 Compliance with Laws; Payment of Taxes

   27

6.05 Insurance

   27

6.06 Maintenance of Property

   27

SECTION 7. Negative Covenants

   27

7.01 Liens

   28

7.02 Dissolution

   28

7.03 Consolidations, Mergers and Sales of Assets

   28

7.04 Use of Proceeds

   28

7.05 Change in Fiscal Year

   28

7.06 Transactions with Affiliates

   29

7.07 Leverage Ratio

   29

7.08 Minimum Net Worth

   29

SECTION 8. Defaults

   29

8.01 Events of Default

   29

8.02 Notice of Default

   31

SECTION 9. Definitions

   32

SECTION 10. Agents, etc.

   45

10.01 Appointment

   45

10.02 Nature of Duties

   46

10.03 Lack of Reliance on the Agents

   46

10.04 Certain Rights of the Agents

   46

10.05 Reliance

   47

 

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Table of Contents (continued)

 

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10.06 Indemnification

   47

10.07 The Agents in Their Individual Capacities

   47

10.08 Holders

   47

10.09 Resignation by an Agent

   47

10.10 Syndication Agent; Documentation Agent

   48

SECTION 11. Miscellaneous

   48

11.01 Payment of Expenses, etc.

   48

11.02 Lender Enforceability Opinions

   49

11.03 Notices

   49

11.04 Benefit of Agreement

   49

11.05 No Waiver; Remedies Cumulative

   51

11.06 Payments Pro Rata

   51

11.07 Calculations; Computations

   51

11.08 Governing Law; Submission to Jurisdiction; Venue; Waiver of Jury Trial

   52

11.09 Counterparts

   53

11.10 Headings Descriptive

   53

11.11 Amendment or Waiver

   53

11.12 Survival

   53

11.13 Domicile of Loans

   53

11.14 Confidentiality

   53

11.15 Lender Register

   54

11.16 Judgment Currency

   54

11.17 Euro

   55

 

ANNEX I

  —   

Commitments

ANNEX II

  —   

Lender Addresses

ANNEX III

  —   

Subsidiaries

ANNEX IV

  —   

Calculation of Associated Cost Rate for Revolving Loans and Competitive Bid
Loans

EXHIBIT A-1

  —   

Form of Notice of Borrowing

EXHIBIT A-2

  —   

Form of Notice of Competitive Bid Borrowing

EXHIBIT B-1

  —   

Form of Revolving Note

EXHIBIT B-2

  —   

Form of Competitive Bid Note

EXHIBIT C

  —   

Form of Section 3.04 Certificate

EXHIBIT D

  —   

Opinion of General Counsel to Borrowers

EXHIBIT E

  —   

Form of Officers’ Certificate

EXHIBIT F

  —   

Form of Financial Guaranty Insurance Policy

EXHIBIT G

  —   

Form of Assignment Agreement

EXHIBIT H

  —   

Form of Commitment Assumption Agreement

EXHIBIT I

  —   

Form of DB Assumption Agreement

EXHIBIT J

  —   

Form of Lender’s Opinions

EXHIBIT K

  —   

Form of Opinion of Designated Borrower’s Counsel

EXHIBIT L

  —   

Form of Opinion of Counsel to Corp.

 

(iii)

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SECOND AMENDED AND RESTATED CREDIT AGREEMENT, dated as of August 28, 1998 and
amended and restated, as of April 19, 2002 and further amended and restated as
of April 16, 2003 among MBIA INC. (“Parent”), a Connecticut corporation, MBIA
INSURANCE CORPORATION (“Corp.”), a New York stock insurance corporation, one or
more Designated Borrowers (as hereinafter defined) from time to time party
hereto, the lenders from time to time party hereto (each, a “Lender” and,
collectively, the “Lenders”), BARCLAYS BANK PLC, as Administrative Agent (in
such capacity, together with any successor Administrative Agent, the
“Administrative Agent”), KEYBANK NATIONAL ASSOCIATION, as Syndication Agent (in
such capacity, together with any successor Syndication Agent, the “Syndication
Agent”) and THE BANK OF NEW YORK, as Documentation Agent (in such capacity,
together with any successor Documentation Agent, the “Documentation Agent”).
Unless otherwise defined herein, all capitalized terms used herein and defined
in Section 9 are used herein as so defined.

 

W I T N E S S E T H:

 

WHEREAS, the Borrowers, the Existing Lenders and the Administrative Agent have
entered into a Credit Agreement, dated as of August 28, 1998 and amended and
restated as of April 19, 2002 (as the same has been amended, modified or
supplemented to, but not including, the Second Restatement Effective Date, the
“Existing Credit Agreement”); and

 

WHEREAS, the parties hereto wish to further amend and restate the Existing
Credit Agreement in the form of this Agreement and make available to the
Borrowers the respective credit facilities provided for herein;

 

NOW, THEREFORE, the parties hereto agree that the Existing Credit Agreement
shall be and is hereby amended and restated in its entirety as follows:

 

SECTION 1. Amount and Terms of Credit.

 

1.01 Commitment. (a) Subject to and upon the terms and conditions set forth
herein, each Lender severally agrees to make, at any time and from time to time
on and after the Second Restatement Effective Date and prior to the Final
Maturity Date, one or more additional loans (the “Revolving Loans” and each a
“Revolving Loan”) to one or more of the Borrowers (on a several basis), which
Revolving Loans: (i) may be made and maintained in such Approved Currency as is
requested by the applicable Borrower (except in the case of Base Rate Loans,
which shall only be Dollar-denominated); (ii) may be repaid and reborrowed in
accordance with the provisions hereof; (iii) except as hereinafter provided,
may, at the option of any Borrower, be incurred and maintained as, and/or
converted into, Base Rate Loans or Eurodollar Loans, provided that all Revolving
Loans made as part of the same Borrowing shall, unless otherwise specified
herein, consist of Revolving Loans of the same Type; and (iv) shall not exceed
in aggregate Principal Amount, after adding thereto the sum of (I) the aggregate
Principal Amount of all other Revolving Loans then outstanding and (II) the
aggregate Principal Amount of all Competitive Bid Loans then outstanding, the
Total Commitment at such time.

 

(b) Subject to and upon the terms and conditions set forth herein, (I) on the
Second Restatement Effective Date, the Existing Competitive Bid Loans made by
each Existing

 

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Lender to any Borrower pursuant to the Existing Credit Agreement and outstanding
on the Second Restatement Effective Date (immediately prior to giving effect
thereto) shall be continued, and shall remain outstanding, as Borrowings of
Loans hereunder to such Borrower and (II) each Lender severally agrees that one
or more Borrowers may, at any time and from time to time on and after the Second
Restatement Effective Date and prior to the Final Maturity Date, (on a several
basis) incur a loan or loans (together with the Existing Competitive Bid Loans
continued pursuant to clause (I) above, the “Competitive Bid Loans” and each, a
“Competitive Bid Loan”) from one or more Bidder Lenders pursuant to a
Competitive Bid Borrowing at any time and from time to time on and after the
Second Restatement Effective Date and prior to the date which is the third
Business Day preceding the date which is seven days prior to the Final Maturity
Date, provided that after giving effect to any Competitive Bid Borrowing and the
use of the proceeds thereof, the aggregate outstanding Principal Amount of
Competitive Bid Loans, when combined with the then aggregate outstanding
Principal Amount of all Revolving Loans, shall not exceed the Total Commitment
at such time.

 

1.02 Minimum Borrowing Amounts, etc. The aggregate Principal Amount of each
Borrowing shall not be less than the Minimum Borrowing Amount. More than one
Borrowing may be incurred on any day, provided that at no time shall there be
outstanding more than six Borrowings of Eurodollar Loans.

 

1.03 Notice of Borrowing. (a) Whenever a Borrower desires to incur Revolving
Loans, it shall give the Administrative Agent at its Notice Office, (x) prior to
3:00 P.M. (New York time) at least three Business Days’ prior written notice (or
telephonic notice promptly confirmed in writing) of each Borrowing of Eurodollar
Loans in Dollars, (y) prior to 11:00 A.M. (New York time) at least three
Business Days’ prior written notice (or telephonic notice promptly confirmed in
writing) of each Borrowing of Eurodollar Loans constituting Alternate Currency
Loans and (z) written notice (or telephonic notice promptly confirmed in
writing) prior to 12:00 P.M. (New York time) on the date of each Borrowing of
Base Rate Loans. Each such notice (each, a “Notice of Borrowing”) shall be in
the form of Exhibit A-1 and shall be irrevocable and shall specify (i) the
identity of the applicable Borrower, (ii) in the case of Alternate Currency
Loans, the Approved Currency for such Loans, (iii) the aggregate principal
amount of the Revolving Loans to be made pursuant to such Borrowing (stated in
the applicable Approved Currency), (iv) the date of Borrowing (which shall be a
Business Day), (v) whether the respective Borrowing shall consist of Base Rate
Loans or Eurodollar Loans, (vi) if Eurodollar Loans, the Interest Period to be
initially applicable thereto and (vii) if DB Loans, the DB Loan Maturity Date to
be applicable thereto. The Administrative Agent shall promptly give each Lender
written notice (or telephonic notice promptly confirmed in writing) of each
proposed Borrowing, of the portion thereof to be funded by such Lender and of
the other matters covered by the Notice of Borrowing.

 

(b) Without in any way limiting the obligation of any Borrower to confirm in
writing any telephonic notice permitted to be given hereunder, the
Administrative Agent may prior to receipt of written confirmation act without
liability upon the basis of such telephonic notice, believed by it in good faith
to be from an Authorized Officer of such Borrower. In each such case, each
Borrower hereby waives the right to dispute the Administrative Agent’s record of
the terms of such telephonic notice absent manifest error.

 

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1.04 Competitive Bid Borrowings. (a) Whenever any Borrower desires to incur a
Competitive Bid Borrowing (excluding Existing Competitive Bid Loans continued
hereunder on the Second Restatement Effective Date), it shall deliver to the
Administrative Agent, prior to 11:00 A.M. (New York time) (x) at least four
Business Days prior to the date of such proposed Competitive Bid Borrowing, in
the case of a Spread Borrowing, and (y) at least one Business Day prior to the
date of such proposed Competitive Bid Borrowing, in the case of an Absolute Rate
Borrowing which is Dollar-denominated, and at least three Business Days prior to
the date of such proposed Competitive Bid Borrowing, in the case of an Absolute
Rate Borrowing which is an Alternate Currency Loan, a written notice
substantially in the form of Exhibit A-2 hereto (a “Notice of Competitive Bid
Borrowing”), which notice shall specify in each case (i) the identity of the
applicable Borrower, (ii) the date (which shall be a Business Day) and the
aggregate amount of the proposed Competitive Bid Borrowing, (iii) the maturity
date for repayment of each and every Competitive Bid Loan to be made as part of
such Competitive Bid Borrowing (which maturity date may be (A) up to six months
after the date of such Competitive Bid Borrowing in the case of a Spread
Borrowing and (B) no fewer than seven days and no more than 180 days after the
date of such Competitive Bid Borrowing in the case of an Absolute Rate
Borrowing, provided that in no event shall the maturity date of any Competitive
Bid Borrowing be later than the third Business Day preceding the Final Maturity
Date), (iv) the interest payment date or dates relating thereto, (v) whether the
proposed Competitive Bid Borrowing is to be an Absolute Rate Borrowing or a
Spread Borrowing, (vi) in the case of an Alternate Currency Loan, the Alternate
Currency for such Competitive Bid Borrowing, and (vii) any other terms to be
applicable to such Competitive Bid Borrowing. The Administrative Agent shall
promptly notify each Bidder Lender by telephone or facsimile of each such
request for a Competitive Bid Borrowing received by it from a Borrower and of
the contents of the related Notice of Competitive Bid Borrowing.

 

(b) Each Bidder Lender shall, if, in its sole discretion, it elects to do so,
irrevocably offer to make one or more Competitive Bid Loans to the applicable
Borrower as part of such proposed Competitive Bid Borrowing at a rate or rates
of interest specified by such Bidder Lender in its sole discretion and
determined by such Bidder Lender independently of each other Bidder Lender, by
notifying the Administrative Agent (which shall give prompt notice thereof to
such Borrower by facsimile), before 9:30 A.M. (New York time) on the date (the
“Reply Date”) which is (x) in the case of an Absolute Rate Borrowing which is
Dollar-denominated, the date of such proposed Competitive Bid Borrowing and in
the case of an Absolute Rate Borrowing which is an Alternate Currency Loan, two
Business Days before the date of such Competitive Bid Borrowing and (y) in the
case of a Spread Borrowing, three Business Days before the date of such proposed
Competitive Bid Borrowing, of the minimum amount and maximum amount of each
Competitive Bid Loan which such Bidder Lender would be willing to make as part
of such proposed Competitive Bid Borrowing (which amounts may, subject to the
proviso contained in Section 1.01(b), exceed such Bidder Lender’s Commitment),
the rate or rates of interest therefor and such Bidder Lender’s lending office
with respect to such Competitive Bid Loan; provided that if the Administrative
Agent in its capacity as a Bidder Lender shall, in its sole discretion, elect to
make any such offer, it shall notify the respective Borrower of such offer
before 9:15 A.M. (New York time) on the Reply Date. If any Bidder Lender shall
elect not to make such an offer, such Bidder Lender shall so notify the
Administrative Agent, before 9:30 A.M. (New York time) on the Reply Date, and
such Bidder Lender shall not be obligated to, and shall not, make any
Competitive Bid Loan as part of such Competitive Bid Borrowing; provided that
the failure by any Bidder Lender to give such notice shall not cause such Bidder
Lender to be obligated to make any Competitive Bid Loan as part of such proposed
Competitive Bid Borrowing.

 

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(c) The applicable Borrower shall, in turn, before 10:30 A.M. (New York time) on
the Reply Date, either:

 

(i) cancel such Competitive Bid Borrowing by giving the Administrative Agent
notice to such effect (it being understood and agreed that if such Borrower
gives no such notice of cancellation and no notice of acceptance pursuant to
clause (ii) below, then such Borrower shall be deemed to have canceled such
Competitive Bid Borrowing), or

 

(ii) accept one or more of the offers made by any Bidder Lender or Bidder
Lenders pursuant to clause (b) above by giving notice (in writing or by
telephone confirmed in writing) to the Administrative Agent of the amount of
each Competitive Bid Loan (which amount shall be equal to or greater than the
minimum amount, and equal to or less than the maximum amount, notified to the
applicable Borrower by the Administrative Agent on behalf of such Bidder Lender
for such Competitive Bid Borrowing pursuant to clause (b) above) to be made by
each Bidder Lender as part of such Competitive Bid Borrowing, and reject any
remaining offers made by Bidder Lenders pursuant to clause (b) above by giving
the Administrative Agent notice to that effect; provided that the acceptance of
offers may only be made on the basis of ascending Absolute Rates (in the case of
an Absolute Rate Borrowing) or Spreads (in the case of a Spread Borrowing), in
each case commencing with the lowest rate so offered; provided further, however,
that if offers are made by two or more Bidder Lenders at the same rate and
acceptance of all such equal offers would result in a greater principal amount
of Competitive Bid Loans being accepted than the aggregate principal amount
requested by the applicable Borrower, if such Borrower elects to accept any such
offers such Borrower shall accept such offers pro rata from such Bidder Lenders
(on the basis of the maximum amounts of such offers) unless any such Bidder
Lender’s pro rata share would be less than the minimum amount specified by such
Bidder Lender in its offer, in which case such Borrower shall have the right to
accept one or more such equal offers in their entirety and reject the other
equal offer or offers or to allocate acceptance among all such equal offers (but
giving effect to the minimum and maximum amounts specified for each such offer
pursuant to clause (b) above), as such Borrower may elect in its sole
discretion.

 

(d) If the applicable Borrower notifies the Administrative Agent that such
Competitive Bid Borrowing is deemed canceled, pursuant to clause (c)(i) above,
the Administrative Agent shall give prompt notice thereof to the Bidder Lenders
and such Competitive Bid Borrowing shall not be made.

 

(e) If the applicable Borrower accepts one or more of the offers made by any
Bidder Lender or Bidder Lenders pursuant to clause (c) (ii) above, the
Administrative Agent shall in turn promptly notify (x) each Bidder Lender that
has made an offer as described in clause (b) above, of the date and aggregate
amount of such Competitive Bid Borrowing and whether or not any offer or offers
made by such Bidder Lender pursuant to clause (b) above have

 

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been accepted by the Borrower and (y) each Bidder Lender that is to make a
Competitive Bid Loan as part of such Competitive Bid Borrowing, of the amount of
each Competitive Bid Loan to be made by such Bidder Lender as part of such
Competitive Bid Borrowing.

 

1.05 Disbursement of Funds. (a) No later than 12:00 Noon (New York time) (or
3:00 P.M. (New York time) in the case of (x) a Borrowing of Base Rate Loans for
which a Notice of Borrowing was given on the date of such Borrowing and (y) a
Competitive Bid Borrowing) on the date specified in each Notice of Borrowing or
Notice of Competitive Bid Borrowing, each Lender will make available its pro
rata share, if any, of such Borrowing requested to be made on such date. All
such amounts shall be made available to the Administrative Agent in the relevant
Approved Currency or Other Alternate Currency, as the case may be, and
immediately available funds at the Payment Office of the Administrative Agent
and the Administrative Agent will promptly make available to the applicable
Borrower by depositing to the account designated by such Borrower, which account
shall be at an institution in the same city as the respective Payment Office,
the aggregate of the amounts so made available in the type of funds received.
Unless the Administrative Agent shall have been notified by any Lender
participating in a Borrowing prior to the date of such Borrowing that such
Lender does not intend to make available to the Administrative Agent its portion
of the Borrowing or Borrowings to be made on such date, the Administrative Agent
may assume that such Lender has made such amount available to the Administrative
Agent on such date of Borrowing, and the Administrative Agent, in reliance upon
such assumption, may (in its sole discretion and without any obligation to do
so) make available to the applicable Borrower a corresponding amount. If such
corresponding amount is not in fact made available to the Administrative Agent
by such Lender and the Administrative Agent has made available same to the
applicable Borrower, the Administrative Agent shall be entitled to recover such
corresponding amount from such Lender. If such Lender does not pay such
corresponding amount forthwith upon the Administrative Agent’s demand therefor,
the Administrative Agent shall promptly notify the applicable Borrower, and such
Borrower shall pay such corresponding amount to the Administrative Agent within
three Business Days of receipt of such notice unless previously paid by such
Lender. The Administrative Agent shall also be entitled to recover on demand
from such Lender or such Borrower, as the case may be, interest on such
corresponding amount in respect of each day from the date such corresponding
amount was made available by the Administrative Agent to such Borrower to the
date such corresponding amount is recovered by the Administrative Agent, at a
rate per annum equal to (x) if paid by such Lender, the overnight Federal Funds
Effective Rate or (y) if paid by such Borrower, the then applicable rate of
interest, calculated in accordance with Section 1.09, for the respective Loans.

 

(b) Nothing herein shall be deemed to relieve any Lender from its obligation to
fulfill its commitments hereunder or to prejudice any rights which any Borrower
may have against any Lender as a result of any default by such Lender hereunder.

 

1.06 Notes. (a) Each Borrower’s obligation to pay the principal of, and interest
on, the Loans made to it by each Lender shall be evidenced (i) if Revolving
Loans, by a promissory note substantially in the form of Exhibit B-1 with blanks
appropriately completed (each, a “Revolving Note” and, collectively, the
“Revolving Notes”) and (ii) if Competitive Bid Loans, by a promissory note
substantially in the form of Exhibit B-2 with blanks appropriately completed
(each a “Competitive Bid Note” and, collectively, the “Competitive Bid Notes”).

 

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(b) Each Lender will note on its internal records the amount of each Loan made
by it and each payment in respect thereof and will, prior to any transfer of any
of its Notes, endorse on the reverse side thereof the outstanding Principal
Amount of Loans evidenced thereby. Failure to make any such notation shall not
affect a Borrower’s obligations in respect of such Loans.

 

1.07 Conversions. Each Borrower shall have the option to convert on any Business
Day occurring on or after the Second Restatement Effective Date, all or a
portion at least equal to the applicable Minimum Borrowing Amount of its
Revolving Loans denominated in a single Approved Currency and constituting Base
Rate Loans or Eurodollar Loans into a Borrowing or Borrowings of Revolving Loans
denominated in such Approved Currency and constituting Eurodollar Loans or Base
Rate Loans, respectively, provided that (i) Eurodollar Loans denominated in a
currency other than Dollars may not be converted into Base Rate Loans, (ii) no
partial conversion shall reduce the outstanding principal amount of the
Eurodollar Loans made pursuant to a Borrowing to less than the Minimum Borrowing
Amount applicable thereto, (iii) Base Rate Loans may not be converted into
Eurodollar Loans when a Default or Event of Default is then in existence if the
Administrative Agent or the Required Lenders shall have determined in its or
their sole discretion not to permit such conversion and (iv) Borrowings of
Eurodollar Loans resulting from this Section 1.07 shall be limited in number as
provided in Section 1.02. Each such conversion shall be effected by the
respective Borrower giving the Administrative Agent at the Notice Office, prior
to 12:00 Noon (New York time), at least three Business Days’ (or one Business
Day in the case of a conversion into Base Rate Loans) prior written notice (or
telephonic notice promptly confirmed in writing) (each, a “Notice of
Conversion”) specifying the Revolving Loans to be so converted, the Type of
Loans (as to interest option) to be converted into and, if to be converted into
a Borrowing of Eurodollar Loans, the Interest Period to be initially applicable
thereto. The Administrative Agent shall give each Lender prompt notice of any
such proposed conversion affecting any of its Loans.

 

1.08 Pro Rata Borrowings, etc. All Revolving Loans incurred pursuant to a
Borrowing shall be made by the Lenders pro rata on the basis of their respective
Commitments. It is understood that no Lender shall be responsible for any
default by any other Lender in its obligation to make Revolving Loans hereunder,
and that each Lender shall be obligated to make the Revolving Loans provided to
be made by it hereunder, regardless of the failure of any other Lender to
fulfill its commitments hereunder and regardless of whether such Lender has made
any Competitive Bid Loans hereunder.

 

1.09 Interest. (a) The unpaid principal amount of each Base Rate Loan shall bear
interest from the date of the Borrowing thereof until the earlier of (i)
maturity (whether by acceleration or otherwise) and (ii) conversion of such Base
Rate Loan to a Eurodollar Loan pursuant to Section 1.07, at a rate per annum
which shall at all times be equal to the sum of the Base Rate plus the
Applicable Margin, each as in effect from time to time.

 

(b) The unpaid principal amount of each Eurodollar Loan shall bear interest from
the date of the Borrowing thereof until the earlier of (i) maturity (whether by
acceleration or otherwise) and (ii) conversion of such Eurodollar Loan to a Base
Rate Loan pursuant to Section 1.07, 1.10 or 1.11(b), as applicable, at a rate
per annum which shall, during each Interest Period applicable thereto, be equal
to the sum of the relevant LIBOR for such Interest Period, plus the Applicable
Margin, as in effect from time to time.

 

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(c) The unpaid principal amount of each Competitive Bid Loan shall bear interest
from the date of the Borrowing thereof until maturity (whether by acceleration
or otherwise) at a rate or rates per annum specified by a Bidder Lender or
Bidder Lenders, as the case may be, pursuant to Section 1.04(b) and accepted by
the respective Borrower pursuant to Section 1.04(c).

 

(d) All overdue principal and, to the extent permitted by law, overdue interest
in respect of each Loan shall bear interest at a rate per annum equal to the
greater of (x) the rate which is 2% in excess of the rate borne by the
respective Loans immediately prior to the respective payment default and (y) the
rate which is 2% in excess of the rate otherwise applicable to Base Rate Loans,
provided that principal in respect of Eurodollar Loans and Competitive Bid Loans
shall bear interest from the date same becomes due (whether by acceleration or
otherwise) until the end of the Interest Period applicable thereto at a rate per
annum equal to 2% plus the rate of interest applicable on the due date therefor.
Interest which accrues under this Section 1.09(d) shall be payable on demand.

 

(e) Interest shall accrue from and including the date of any Borrowing to but
excluding the date of any repayment thereof, and in the case of DB Loans,
compounded as described below, and shall be payable (i) in respect of each Base
Rate Loan (other than a DB Loan), quarterly in arrears on the last Business Day
of each March, June, September and December, (ii) in respect of each Eurodollar
Loan (other than a DB Loan), on the last day of each Interest Period applicable
thereto and, in the case of an Interest Period in excess of three months, on
each date occurring at three month intervals after the first day of such
Interest Period, (iii) in respect of each DB Loan, on the applicable DB Loan
Maturity Date, (iv) in respect of each Competitive Bid Loan, at such times as
specified in the Notice of Competitive Bid Borrowing relating thereto, and (v)
in respect of each Loan, on any prepayment or conversion (other than the
prepayment or conversion of any Base Rate Loan) (on the amount prepaid or
converted), at maturity (whether by acceleration or otherwise) and, after such
maturity, on demand. Interest on any Existing Competitive Bid Loans which
accrued under the Existing Credit Agreement prior to the Second Restatement
Effective Date, but which remains unpaid on such date (and which was not
required to be paid on or prior to such date in accordance with the terms of the
Existing Credit Agreement or this Agreement) shall be payable at the times
otherwise provided above (but calculated at the respective rates provided in the
Existing Credit Agreement for periods occurring prior to the Second Restatement
Effective Date) for the interest involved, without any change on the Second
Restatement Effective Date as to the Interest Periods then in effect.
Notwithstanding anything to the contrary contained in this Agreement, although
interest in respect of each DB Loan shall be payable only on the DB Loan
Maturity Date for such DB Loan as provided in clause (iii) of the immediately
preceding sentence, interest on each DB Loan shall compound on each date on
which interest thereon would have been payable pursuant to clause (i) or (ii) of
such sentence if such Loan were not a DB Loan and such compounded interest shall
thereafter bear interest hereunder at the same rate per annum as the principal
of the DB Loan to which such compounded interest relates.

 

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(f) All computations of interest hereunder shall be made in accordance with
Section 11.07(b).

 

(g) The Administrative Agent, upon determining the interest rate for any
Borrowing for any Interest Period, shall promptly notify the applicable Borrower
and the Lenders thereof.

 

1.10 Interest Periods. (a) At the time a Borrower gives a Notice of Borrowing or
a Notice of Conversion in respect of the making of, or conversion into, a
Borrowing of Eurodollar Loans (in the case of the initial Interest Period
applicable thereto) or prior to 12:00 Noon (New York Time) on the third Business
Day prior to the expiration of an Interest Period applicable to a Borrowing of
Eurodollar Loans, it shall have the right to elect by giving the Administrative
Agent written notice (or telephonic notice promptly confirmed in writing) of the
Interest Period applicable to such Borrowing, which Interest Period shall, at
the option of such Borrower, be a one, two, three or six month period or such
other period available to all Lenders. Notwithstanding anything to the contrary
contained above:

 

(i) the initial Interest Period for any Borrowing shall commence on the date of
such Borrowing (including, where relevant, the date of any conversion from a
Borrowing of Base Rate Loans) and each Interest Period occurring thereafter in
respect of such Borrowing shall commence on the day on which the next preceding
Interest Period expires;

 

(ii) if any Interest Period begins on (x) the last Business Day of a month, it
shall end on the last Business Day of the month in which it is to end and (y) a
day for which there is no numerically corresponding day in the calendar month at
the end of such Interest Period, such Interest Period shall end on the last
Business Day of such calendar month;

 

(iii) if any Interest Period would otherwise expire on a day which is not a
Business Day, such Interest Period shall expire on the next succeeding Business
Day, provided that if any Interest Period would otherwise expire on a day which
is not a Business Day but is a day of the month after which no further Business
Day occurs in such month, such Interest Period shall expire on the next
preceding Business Day;

 

(iv) no Interest Period may be elected that would extend beyond the Final
Maturity Date;

 

(v) no Interest Period in respect of a DB Loan may be elected that would extend
beyond the DB Loan Maturity Date for such DB Loan;

 

(vi) no Interest Period may be elected at any time when a Default or an Event of
Default is then in existence if the Administrative Agent or the Required Lenders
shall have determined in its or their sole discretion not to permit such
election; and

 

(vii) all Eurodollar Loans comprising a Borrowing shall at all times have the
same Interest Period.

 

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(b) If upon the expiration of any Interest Period, the applicable Borrower has
failed to (or may not) elect a new Interest Period to be applicable to the
Revolving Loans subject to the expiring Interest Period as provided above, such
Borrower shall be deemed to have elected, in the case of Eurodollar Loans, to
convert such Borrowing into a Borrowing of Base Rate Loans effective as of the
expiration date of such current Interest Period, provided that if such
Eurodollar Loans are denominated in a currency other than Dollars, then such
Eurodollar Loans shall not convert to Base Rate Loans but shall instead be
prepaid by the applicable Borrower on the last day of such Interest Period.

 

1.11 Increased Costs, Illegality, etc. (a) In the event that (x) in the case of
clause (i) or (iv) below, the Administrative Agent or (y) in the case of clause
(ii) or (iii) below, any Lender shall have determined (which determination
shall, absent manifest error, be final and conclusive and binding upon all
parties hereto):

 

(i) on any date for determining any LIBOR for any Interest Period that, by
reason of any changes arising after the Original Effective Date affecting the
relevant interbank market, adequate and fair means do not exist for ascertaining
the applicable interest rate on the basis provided for in the definition of the
respective LIBOR; or

 

(ii) at any time, that such Lender shall actually incur increased costs or
reductions in the amounts received or receivable hereunder with respect to any
Eurodollar Loans or Competitive Bid Loans (other than any increased cost or
reduction in the amount received or receivable resulting from the imposition of
or a change in the rate of taxes or similar charges on, or determined by
reference to, the net income or net profits of such Lender by the jurisdiction
in which its principal office or applicable lending office is located) because
of (x) any change since the Original Effective Date (or, in the case of any
Competitive Bid Loan, since the making of such Competitive Bid Loan) in any
applicable law, governmental rule, regulation, guideline or order (or in the
interpretation or administration thereof and including the introduction of any
new law or governmental rule, regulation, guideline or order) (such as, for
example, but not limited to, a change in official reserve requirements, but, in
all events, excluding amounts payable pursuant to Section 1.11(c) and those
included in determining any Associated Costs Rate) and/or (y) other
circumstances occurring since the Original Effective Date affecting the relevant
interbank market; or

 

(iii) at any time since the Original Effective Date, that the making or
continuance of any Eurodollar Loans or Competitive Bid Loans has become unlawful
by compliance by such Lender in good faith with any law, governmental rule,
regulation or guideline, or has become impracticable as a result of a
contingency occurring after the Original Effective Date which materially and
adversely affects the relevant interbank market; or

 

(iv) at any time that any Alternate Currency is not available in sufficient
amounts, as determined in good faith by the Administrative Agent, to fund any
Borrowing of Loans denominated in such Alternate Currency;

 

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then, and in any such event, such Lender (or the Administrative Agent in the
case of clause (i) or (iv) above) shall (x) on such date and (y) within ten
Business Days of the date on which such event no longer exists give notice (by
telephone confirmed in writing) to the respective Borrower and, except in the
case of clause (i) or (iv) above, to the Administrative Agent of such
determination (which notice the Administrative Agent shall promptly transmit to
each of the other Lenders). Thereafter and for so long as the applicable
circumstance continues to exist (w) in the case of clause (i) above, Eurodollar
Loans priced in respect of the affected LIBOR (and Competitive Bid Loans
constituting a Spread Borrowing priced by reference to such LIBOR) shall no
longer be available until such time as the Administrative Agent notifies the
respective Borrower and the Lenders that the circumstances giving rise to such
notice by the Administrative Agent no longer exist in accordance with clause (y)
of the preceding sentence, and any Notice of Borrowing, Notice of Competitive
Bid Borrowing or Notice of Conversion given by a Borrower with respect to such
Loans which have not yet been incurred shall be deemed rescinded by the relevant
Borrower, (x) in the case of clause (ii) above, the applicable Borrower shall
pay to such Lender, upon written demand therefor, such additional amounts (in
the form of an increased rate of, or a different method of calculating, interest
or otherwise as such Lender in its sole discretion shall determine) as shall be
required to compensate such Lender for such increased costs or reductions in
amounts receivable hereunder (a written notice as to the additional amounts owed
to such Lender, showing the basis for the calculation thereof in reasonable
detail, submitted to the applicable Borrower by such Lender shall, absent
manifest error, be final and conclusive and binding upon all parties hereto),
(y) in the case of clause (iii) above, the applicable Borrower shall take one of
the actions specified in Section 1.11(b) as promptly as possible and, in any
event, within the time period required by law and (z) in the case of clause (iv)
above, Loans in the affected Alternate Currency shall no longer be available
until such time as the Administrative Agent notifies the respective Borrower and
the Lenders that the circumstances giving rise to such notice by the
Administrative Agent no longer exist in accordance with clause (y) of the
preceding sentence, and any Notice of Borrowing, Notice of Competitive Bid
Borrowing or Notice of Conversion given by a Borrower with respect to such
Alternate Currency Loans which have not yet been incurred shall be deemed
rescinded by such Borrower.

 

(b) At any time when any Eurodollar Loan or Competitive Bid Loan is affected by
the circumstances described in Section 1.11(a)(ii) or (iii), the applicable
Borrower may (and in the case of a Eurodollar Loan or Competitive Bid Loan
affected pursuant to Section 1.11(a)(iii), the applicable Borrower shall) either
(i) if the affected Eurodollar Loan or Competitive Bid Loan is then being made
pursuant to a Borrowing, cancel said Borrowing by giving the Administrative
Agent telephonic notice (confirmed promptly in writing) thereof on the same date
that the respective Borrower was notified by a Lender pursuant to Section
1.11(a)(ii) or (iii), or (ii) if the affected Eurodollar Loan or Competitive Bid
Loan is then outstanding, upon at least three Business Days’ notice to the
Administrative Agent, (A) in the case of a Eurodollar Loan denominated in
Dollars, require the affected Lender to convert each such Eurodollar Loan into a
Base Rate Loan, and (B) in the case of a Eurodollar Loan denominated in a
Primary Alternate Currency and in the case of a Competitive Bid Loan, repay all
such Eurodollar Loans or Competitive Bid Loans in full in accordance with the
applicable requirements of Section 3.01, provided that if more than one Lender
is affected at any time, then all affected Lenders must be treated the same
pursuant to this Section 1.11(b).

 

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(c) If any Lender shall have determined that after the Original Effective Date,
the adoption or effectiveness of any applicable law, rule or regulation
regarding capital adequacy, or any change therein after the Original Effective
Date, or any change after the Original Effective Date in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by such Lender or any corporation controlling such Lender with any request or
directive regarding capital adequacy (whether or not having the force of law) of
any such authority, central bank or comparable agency adopted or effective after
the Original Effective Date, has or would have the effect of reducing the rate
of return on such Lender’s or such corporation’s capital or assets as a
consequence of its commitments or obligations hereunder to a level below that
which such Lender or such other corporation could have achieved but for such
adoption, effectiveness, change or compliance (taking into consideration such
Lender’s or such other corporation’s policies with respect to capital adequacy),
then from time to time, within 15 days after written demand by such Lender (with
a copy to the Administrative Agent), the Borrowers jointly and severally agree
to pay to such Lender such additional amount or amounts as will compensate such
Lender or such other corporation for such reduction. In determining such
additional amounts, each Lender will act reasonably and in good faith and will
use averaging and attribution methods that are reasonable. Each Lender, upon so
determining that any additional amounts will be payable pursuant to this Section
1.11(c), will give prompt written notice thereof to the Borrowers, which notice
shall set forth in reasonable detail the basis of the calculation of such
additional amounts, although the failure to give any such notice shall not
release or diminish any Borrower’s obligations to pay additional amounts
pursuant to this Section 1.11(c) upon the subsequent receipt of such notice.

 

1.12 Compensation. Each Borrower shall compensate each Lender, upon its written
request (which request shall set forth the basis for requesting such
compensation), for all reasonable losses, expenses and liabilities (including,
without limitation, any loss, expense or liability incurred by reason of the
liquidation or reemployment of deposits or other funds required by such Lender
to fund any Eurodollar Loans or Competitive Bid Loans made, or to be made, by it
to such Borrower but excluding in any event the loss of anticipated profits)
which such Lender may actually sustain: (i) if for any reason (other than a
default by such Lender or the Administrative Agent) a Borrowing of Eurodollar
Loans or Competitive Bid Loans does not occur on a date specified therefor in a
Notice of Borrowing, a Notice of Competitive Bid Borrowing or a Notice of
Conversion, given by such Borrower (whether or not withdrawn by such Borrower or
deemed withdrawn pursuant to Section 1.11(a)); (ii) if any prepayment, repayment
or conversion of any such Eurodollar Loans or Competitive Bid Loans occurs on a
date which is not the last day of an Interest Period applicable thereto; (iii)
if any prepayment of any such Eurodollar Loans or Competitive Bid Loans is not
made on any date specified in a notice of prepayment given by such Borrower;
(iv) if such Lender is required pursuant to Section 1.14 to assign any such
Eurodollar Loans or Competitive Bid Loans as of a date which is not the last day
of an Interest Period applicable thereto; or (v) as a consequence of (x) any
other default by such Borrower to repay its Eurodollar Loans or Competitive Bid
Loans when required by the terms of this Agreement or (y) an election made
pursuant to Section 1.11(b).

 

1.13 Change of Lending Office. Each Lender agrees that, upon the occurrence of
any event giving rise to the operation of Section 1.11(a)(ii) or (iii), 1.11(c)
or 3.04 with respect to such Lender, it will, if requested by the applicable
Borrower, use reasonable efforts (subject to

 

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overall policy considerations of such Lender) to designate another lending
office for any Loans or Commitments affected by such event, provided that such
designation is made on such terms that such Lender and its lending office suffer
no economic, legal or regulatory disadvantage, with the object of avoiding or
materially mitigating the consequence of the event giving rise to the operation
of any such Section. Nothing in this Section 1.13 shall affect or postpone any
of the obligations of any Borrower or the right of any Lender provided in
Section 1.11 or 3.04.

 

1.14 Replacement of Lenders. (a) Upon the occurrence of any event giving rise to
the operation of Section 1.11(a)(ii) or (iii), Section 1.11(c) or Section 3.04
with respect to any Lender which results in such Lender charging to any Borrower
increased costs in excess of those being generally charged by the other Lenders,
(b) if a Lender becomes a Defaulting Lender, (c) if a Lender becomes a
Non-Continuing Lender, (d) if a Lender fails to maintain a long-term debt rating
of at least BBB- as determined by Standard & Poor’s Corporation and at least
Baa3 as determined by Moody’s Investors Service, Inc., (e) if a Lender fails to
deliver the opinion or opinions as required pursuant to Section 11.02 and/or (f)
in the case of a refusal by a Lender to consent to a proposed change, waiver,
discharge or termination with respect to this Agreement which has been approved
by the Required Lenders, Parent and Corp. shall have the right, if no Default or
Event of Default then exists, to replace such Lender (the “Replaced Lender”),
upon prior written notice to the Administrative Agent and such Replaced Lender,
with one or more Person or Persons, none of whom shall constitute a Defaulting
Lender at the time of such replacement (collectively, the “Replacement Lenders”
and, each a “Replacement Lender”) reasonably acceptable to the Administrative
Agent, provided that (i) at the time of any replacement pursuant to this Section
1.14, the Replacement Lender and the Replaced Lender shall enter into one or
more Assignment Agreements pursuant to Section 11.04(b) (and with all fees
payable pursuant to said Section 11.04(b) to be paid by the Replacement Lender)
pursuant to which each of the Replacement Lenders shall acquire all of the
Commitments and outstanding Loans of the Replaced Lender and, in connection
therewith, shall pay to the Replaced Lender in respect thereof an amount equal
to the sum of (A) an amount equal to the principal amount of, and all accrued
but unpaid interest on, all outstanding Loans of the Replaced Lender and (B) an
amount equal to all accrued, but theretofore unpaid, Fees owing to the Replaced
Lender pursuant to Section 2.01, and (ii) all obligations of the Borrowers under
the Credit Documents owing to the Replaced Lender (other than those specifically
described in clause (i) above in respect of which the assignment purchase price
has been, or is concurrently being, paid), including without limitation all
amounts owing to the Replaced Lender under Section 1.12 as a result of the
assignment of its Loans under clause (i) above, shall be paid in full to such
Replaced Lender concurrently with such replacement. Upon the execution of the
respective Assignment Agreements, the payment of amounts referred to in clauses
(i) and (ii) above and, if so requested by the Replacement Lender, delivery to
the Replacement Lender of the appropriate Note or Notes executed by the relevant
Borrowers, the Replacement Lender shall become a Lender hereunder and the
Replaced Lender shall cease to constitute a Lender hereunder, except with
respect to indemnification provisions applicable to the Replaced Lender under
this Agreement, which shall survive as to such Replaced Lender.

 

1.15 Recommitment; Replacement of Non-Continuing Lender. Parent and Corp. may,
prior to (but not less than 60 days nor more than 120 days prior to) the Final
Maturity Date then in effect (each such Final Maturity Date, a “Recommitment
Deadline”), by written notice to the Administrative Agent (which notice the
Administrative Agent shall promptly transmit to each

 

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Lender), request that the Final Maturity Date then in effect be extended. Such
request shall be accompanied by a certificate of an Authorized Officer of Parent
stating that no Default or Event of Default has occurred and is continuing. Each
Lender shall respond to such request, as promptly as practicable, by written
notice to Parent, Corp. and the Administrative Agent, with the failure of any
Lender to respond prior to the Recommitment Deadline being deemed to be a
negative response. In the event each Lender shall consent to such request of
Parent and Corp., on such Recommitment Deadline, the Final Maturity Date shall
be automatically extended to the date occurring 364 days following the Final
Maturity Date then in effect. If any Lender shall fail to consent to such
recommitment (any such Lender, a “Non-Continuing Lender”), Parent and Corp.
shall be entitled at any time prior to the Recommitment Deadline with respect to
such request to replace such Lender in accordance with the requirements of
Section 1.14, and in the event that the Replacement Lender with respect to each
such Non-Continuing Lender shall consent to such recommitment prior to such
Recommitment Deadline, such recommitment shall be effective as described in the
immediately preceding sentence as if each Lender had originally consented to
such request. No Lender shall be obligated to grant any recommitments pursuant
to this Section 1.15 and any such recommitment shall be in the sole discretion
of each such Lender. The Administrative Agent shall notify Parent, Corp. and
each Lender as to the effectiveness of any such recommitment.

 

1.16 Additional Commitments. At any time and from time to time on and after the
Second Restatement Effective Date and prior to the Final Maturity Date, Parent
and Corp. may request one or more Lenders or other lending institutions to
increase its Commitment (in the case of an existing Lender) or assume a
Commitment (in the case of any other lending institution) and, in the sole
discretion of each such Lender or other institution, any such Lender or other
institution may agree to so commit; provided that (i) no Default or Event of
Default then exists, (ii) the increase in the Total Commitment pursuant to any
such request shall be in an aggregate amount of at least $9,000,000 and (iii)
the aggregate increase in the Total Commitment pursuant to this Section 1.16
shall not exceed $75,000,000. Parent, Corp. and each such Lender or other
lending institution (each, an “Assuming Lender”) which agrees to increase its
existing, or assume, a Commitment shall execute and deliver to the
Administrative Agent a Commitment Assumption Agreement substantially in the form
of Exhibit H (with the increase in, or in the case of a new Assuming Lender,
assumption of, such Lender’s Commitment to be effective on the Business Day
following delivery of such Commitment Assumption Agreement to the Administrative
Agent). The Administrative Agent shall promptly notify each Lender as to the
occurrence of each Commitment Assumption Date. On each Commitment Assumption
Date, (x) Annex I shall be deemed modified to reflect the revised Commitments of
the Lenders, (y) Parent and Corp. shall pay to each such Assuming Lender such up
front fee (if any) as may have been agreed between Parent, Corp. and such
Assuming Lender and (z) the Borrowers will issue new Notes to the Assuming
Lenders in conformity with the requirements of Section 1.06. Notwithstanding
anything to the contrary contained in this Agreement, in connection with any
increase in the Total Commitment pursuant to this Section 1.16, each Borrower
shall, in coordination with the Administrative Agent and the Lenders, repay
outstanding Revolving Loans of certain Lenders and, if necessary, incur
additional Revolving Loans from other Lenders, in each case so that such Lenders
participate in each Borrowing of such Revolving Loans pro rata on the basis of
their Commitments (after giving effect to any increase thereof). It is hereby
agreed that any breakage costs of the type described in Section 1.12 incurred by
the Lenders in connection with the repayment of Revolving Loans contemplated by
this Section 1.16 shall be for the account of the respective Borrowers.

 

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1.17 Designated Borrowers. Parent or Corp. may from time to time designate one
or more Persons as a Designated Borrower (each, a “Designated Borrower” and,
collectively, the “Designated Borrowers”), subject to the following terms and
conditions:

 

(a) each such Person shall be a special purpose entity organized under the laws
of the United States of America, a state thereof or the District of Columbia;

 

(b) each such Person shall enter into an appropriately completed DB Assumption
Agreement in the form of Exhibit I hereto on or prior to the date of
designation;

 

(c) each such Person shall furnish to each Lender its most recent historic or
pro forma financial statements (which financial statements may be summary in
nature and unaudited) on or prior to the date of designation;

 

(d) at the time of such designation, such Person shall not be subject to any
bankruptcy or insolvency proceeding of the type referred to in Section 8.01(h)
or (i) and shall not be subject to any material litigation;

 

(e) on or prior to the date of designation, such Person shall execute and
deliver to each Lender requesting the same, a Revolving Note and a Competitive
Bid Note to evidence the DB Loans incurred by such Person;

 

(f) on or prior to the date of designation, the Administrative Agent shall have
received from such Person a certificate, signed by an Authorized Officer of such
Person in the form of Exhibit E with appropriate insertions or deletions,
together with (x) copies of its certificate of incorporation, by-laws or other
organizational documents and (y) the resolutions relating to the Credit
Documents which shall be satisfactory to the Administrative Agent; and

 

(g) on or prior to the date of designation, the Administrative Agent shall have
received an opinion, addressed to each Agent and each of the Lenders and dated
the date of designation, from counsel to such Person which opinion shall be
substantially in the form of Exhibit K hereto.

 

1.18 Retroactivity. Notwithstanding anything in this Agreement to the contrary,
to the extent any notice required by Section 1.11 or 3.04 is given by any Lender
more than 90 days after such Lender obtained knowledge of the occurrence of the
event giving rise to the additional costs of the type described in such Section,
such Lender shall not be entitled to compensation under Section 1.11 or 3.04 for
any amounts incurred or accruing prior to the 90th day preceding the giving of
such notice to the respective Borrower.

 

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SECTION 2. Fees; Commitments.

 

2.01 Fees. (a) Parent and Corp. jointly and severally agree to pay to the
Administrative Agent a facility fee (the “Facility Fee”) for the account of the
Lenders pro rata on the basis of their respective Commitments for the period
from and including the Second Restatement Effective Date to but excluding the
date the Total Commitment has been terminated computed at a rate per annum equal
to the Applicable Margin on the Total Commitment as in effect from time to time.
Accrued Facility Fees shall be due and payable quarterly in arrears on the last
Business Day of each March, June, September and December, on the Final Maturity
Date or upon such earlier date as the Total Commitment shall be terminated and,
with respect to any Facility Fee owing to any Lender whose Commitment is
terminated pursuant to Section 1.14, on the date on which such Lender’s
Commitment is terminated.

 

(b) Parent and Corp. jointly and severally agree to pay to the Administrative
Agent, for the account of the Administrative Agent, when and as due, such fees
as have been, or are from time to time, separately agreed upon.

 

(c) All computations of Fees shall be made in accordance with Section 11.07(b).

 

2.02 Voluntary Reduction of Commitments. Upon at least three Business Days’
prior written notice (or telephonic notice confirmed in writing) to the
Administrative Agent at the Notice Office (which notice shall be deemed to be
given on a certain day only if given before 12:00 Noon (New York time) on such
day and shall be promptly transmitted by the Administrative Agent to each of the
Lenders), Parent and/or Corp. shall have the right, without premium or penalty,
to terminate or partially reduce the Total Unutilized Commitment, provided that
(x) any such termination shall apply to proportionately and permanently reduce
the Commitment of each Lender and (y) any partial reduction pursuant to this
Section 2.02 shall be in the amount of at least $10,000,000.

 

2.03 Mandatory Reduction of Commitments. (a) The Total Commitment shall
terminate in its entirety on May 31, 2003 unless the Second Restatement
Effective Date has occurred on or before such date and in the event of such
termination this Agreement shall cease to be of any force or effect and the
Existing Credit Agreement (and all commitments to extend credit thereunder in
accordance with the terms thereof) shall continue to be effective, as the same
may have been, or thereafter be, amended, modified or supplemented from time to
time.

 

(b) The Total Commitment shall terminate in its entirety on the Final Maturity
Date.

 

SECTION 3. Payments.

 

3.01 Voluntary Prepayments. Each Borrower shall have the right to prepay
Revolving Loans made to it in whole or in part, without premium or penalty, from
time to time on the following terms and conditions: (i) such Borrower shall give
the Administrative Agent at the Payment Office written notice (or telephonic
notice promptly confirmed in writing) of its intent to prepay such Revolving
Loans, the amount of such prepayment, the currency in which such Revolving Loans
are denominated and the specific Borrowing(s) pursuant to which such

 

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Revolving Loans were made, which notice shall be given by such Borrower at least
three Business Days prior to the date of such prepayment and which notice shall
promptly be transmitted by the Administrative Agent to each of the Lenders; (ii)
each partial prepayment of any Borrowing shall be in an aggregate principal
amount of at least $1,000,000 (or the Dollar Equivalent thereof), provided that
no partial prepayment of Revolving Loans made pursuant to a Borrowing shall
reduce the aggregate principal amount of the Revolving Loans outstanding
pursuant to such Borrowing to an amount less than the Minimum Borrowing Amount
applicable thereto; (iii) each prepayment in respect of any Revolving Loans made
pursuant to a Borrowing shall be applied pro rata among such Revolving Loans;
and (iv) prepayments of Eurodollar Loans made pursuant to this Section 3.01 may
only be made on the last day of an Interest Period applicable thereto unless
concurrently with such prepayment any payments required to be made pursuant to
Section 1.12 as a result of such prepayment are made. No Borrower shall have the
right under this Section 3.01 to prepay any principal amount of any Competitive
Bid Loans.

 

3.02 Mandatory Prepayments and Repayments. (a) If on any date the sum of the
aggregate outstanding Principal Amount of Revolving Loans and Competitive Bid
Loans (or, in each case, the Dollar Equivalent thereof) (all the foregoing,
collectively, the “Aggregate Loan Outstandings”) exceeds the Total Commitment as
then in effect, the Borrowers, jointly and severally, shall repay no later than
the next following Business Day the Principal Amount of Revolving Loans (but
excluding DB Loans to the extent the respective DB Loan Maturity Date has not
occurred) in an aggregate Principal Amount equal to such excess. If, after
giving effect to the prepayment of all outstanding Revolving Loans as set forth
above, the remaining Aggregate Loan Outstandings exceed the Total Commitment,
the Borrowers, jointly and severally, shall repay on such date the principal of
Competitive Bid Loans in an aggregate amount equal to such excess.

 

(b) On the maturity date specified pursuant to Section 1.04(a) with respect to
each Competitive Bid Loan, the applicable Borrower shall repay such Competitive
Bid Loan to the applicable Bidder Lender or Bidder Lenders.

 

(c) On each DB Loan Maturity Date, the respective Designated Borrower shall
repay the respective DB Loans in full.

 

(d) Notwithstanding anything to the contrary contained elsewhere in this
Agreement, all outstanding Revolving Loans and Competitive Bid Loans shall be
repaid in full on the Final Maturity Date.

 

(e) With respect to each prepayment of Revolving Loans required by Section
3.02(a) or (b), the applicable Borrower may designate the Types of Revolving
Loans which are to be prepaid and the specific Borrowing(s) pursuant to which
made, provided that (i) if any prepayment of Eurodollar Loans made pursuant to a
single Borrowing shall reduce the outstanding Revolving Loans made pursuant to
such Borrowing to an amount less than the Minimum Borrowing Amount applicable to
such Borrowing, then all Revolving Loans outstanding pursuant to such Borrowing
shall be immediately converted into Base Rate Loans and (ii) each prepayment of
any Revolving Loans made pursuant to a Borrowing shall be applied pro rata among
such Revolving Loans. In the absence of a designation by a Borrower as described
in the preceding sentence, the Administrative Agent shall, subject to the above,
make such designation in its sole discretion with a view, but no obligation, to
minimize breakage costs owing under Section 1.12.

 

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3.03 Method and Place of Payment. Except as otherwise specifically provided
herein, all payments under this Agreement shall be made to the Administrative
Agent for the ratable (based on its pro rata share) account of the Lenders
entitled thereto, not later than 12:00 Noon (New York Time) on the date when due
and shall be made in immediately available funds at the Payment Office in: (x)
Dollars, if such payment is made in respect of any obligation of the Borrowers
under this Agreement except as otherwise provided in the immediately succeeding
clause (y); and (y) the appropriate Alternate Currency, if such payment is made
in respect of principal of or interest on Alternate Currency Loans, it being
understood that written notice by a Borrower to the Administrative Agent to make
a payment from the funds in such Borrower’s account at the Payment Office shall
constitute the making of such payment to the extent of such funds held in such
account. Any payments under this Agreement which are made later than 12:00 Noon
(New York Time) shall be deemed to have been made on the next succeeding
Business Day. Whenever any payment to be made hereunder shall be stated to be
due on a day which is not a Business Day, the due date thereof shall be extended
to the next succeeding Business Day and, with respect to payments of principal,
interest shall be payable during such extension at the applicable rate in effect
immediately prior to such extension. The Administrative Agent will promptly make
available to each Lender its pro rata share (if any) of each payment so received
by the Administrative Agent in the funds and currency so received.

 

3.04 Net Payments. (a) All payments made by each Borrower hereunder or under any
Note will be made without setoff, counterclaim or other defense. Except as
provided in Section 3.04(b), all such payments will be made free and clear of,
and without deduction or withholding for, any present or future taxes, levies,
imposts, duties, fees, assessments or other charges of whatever nature now or
hereafter imposed by any jurisdiction (or by any political subdivision or taxing
authority thereof or therein) with respect to such payments (but excluding,
except as provided in the second succeeding sentence, any tax levy, impost,
duty, fee, assessment or other governmental charge imposed on or measured by the
net income or net profits of a Lender (including, without limitation, any
franchise tax imposed on or measured by net income or net profits and any branch
profits taxes) pursuant to the laws of the jurisdiction in which it is organized
or the jurisdiction in which the principal office or applicable lending office
of such Lender is located (or any subdivision or taxing authority thereof or
therein)) and all interest, penalties or similar liabilities with respect to
such non-excluded taxes, levies, imposts, duties, fees, assessments or other
governmental charges (all such non-excluded taxes, levies, imposts, duties,
fees, assessments or other governmental charges being referred to collectively
as “Taxes”). If any Taxes are so levied or imposed, the relevant Borrower shall
pay the full amount of such Taxes to the relevant taxing authority in accordance
with applicable law and shall pay to the relevant Lender such additional amounts
as may be necessary so that every payment of all amounts due under this
Agreement or under any Note, after withholding or deduction for or on account of
any Taxes, will not be less than the amount provided for herein or in such Note.
If any amounts are payable in respect of Taxes pursuant to the preceding
sentence, the relevant Borrower agrees to reimburse each Lender lending to such
Borrower, upon the written request of such Lender, for taxes imposed on or
measured by the net income or net profits of such Lender (including, without
limitation, any franchise tax imposed on or measured by net income or net
profits and any branch profits taxes imposed by the United States of America or
similar taxes

 

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imposed by any political subdivision or taxing authority thereof) pursuant to
the laws of the jurisdiction in which such Lender is organized or in which the
principal office or applicable lending office of such Lender is located (or of
any subdivision or taxing authority therein or thereof) and for any withholding
of taxes as such Lender shall determine are payable by, or withheld from, such
Lender in respect of such amounts so paid to or on behalf of such Lender
pursuant to the preceding sentence and in respect of any amounts paid to or on
behalf of such Lender pursuant to this sentence. Each Borrower will furnish to
the Administrative Agent within 45 days after the date the payment of any Taxes
is due pursuant to applicable law certified copies of tax receipts, if any,
issued by such taxing authority or other evidence reasonably acceptable to the
Administrative Agent evidencing such payment by such Borrower (or, if such
Borrower has not received such certified copies of tax receipts within such time
period, then such Borrower shall furnish such certified copies of tax receipts
to the Administrative Agent within 15 days after such Borrower has received such
certified copies of tax receipts). Each Borrower agrees to indemnify and hold
harmless each Lender, and reimburse such Lender upon its written request, for
the amount of any Taxes so levied or imposed and paid by such Lender. Such
indemnification shall be made within 30 days after the date upon which such
Lender makes written demand therefor, which demand shall identify the nature and
the amount of Taxes for which indemnification is sought and shall include a copy
of any written assessment thereof.

 

(b) In the case of any Borrower that is a United States person (as such term is
defined in Section 7701(a)(30) of the Code), each Lender that is not a United
States person (as such term is defined in Section 7701(a)(30) of the Code) for
Federal income tax purposes agrees to deliver to the Borrowers and the
Administrative Agent on or prior to the Second Restatement Effective Date, or in
the case of a Lender that assumes an interest or is an assignee or transferee of
an interest under this Agreement pursuant to Section 1.14, 1.16 or 11.04 (unless
the respective Lender was already a Lender hereunder immediately prior to such
assumption, assignment or transfer), on the date of such assumption, assignment
or transfer to such Lender, (i) two accurate and complete original signed copies
of Internal Revenue Service Form W-8ECI or Form W-8BEN (with respect to a
complete exemption under an income tax treaty) (or successor forms) certifying
to such Lender’s entitlement to a complete exemption from United States
withholding tax with respect to payments to be made by the Borrowers under this
Agreement and under any Note or (ii) if the Lender is not a “bank” within the
meaning of Section 881(c)(3)(A) of the Code and cannot deliver either Internal
Revenue Service Form W-8ECI or Form W-8BEN (with respect to a complete exemption
under an income tax treaty) pursuant to clause (i) above, (x) a certificate
substantially in the form of Exhibit C (any such certificate, a “Section 3.04
Certificate”) and (y) two accurate and complete original signed copies of
Internal Revenue Service Form W-8BEN (with respect to the portfolio interest
exemption) (or successor form) certifying to such Lender’s entitlement to a
complete exemption from United States withholding tax with respect to payments
of interest to be made by the Borrowers under this Agreement and under any Note.
In addition, each such Lender agrees that, from time to time after the Second
Restatement Effective Date, when a lapse in time or change in circumstances
renders the previous certification obsolete or inaccurate in any material
respect, it will deliver to the Borrowers and the Administrative Agent two new
accurate and complete original signed copies of Internal Revenue Service Form
W-8ECI, Form W-8BEN (with respect to the benefits of an income tax treaty) or
Form W-8BEN (with respect to the portfolio interest exemption) and a Section
3.04 Certificate, as the case may be, and such other forms as may be required in
order to confirm or establish the entitlement of such Lender to a continued
exemption from or reduction

 

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in United States withholding tax with respect to payments made by the Borrowers
under this Agreement and any Note, or, if legally unable to deliver such forms,
it shall immediately notify the Borrowers and the Administrative Agent of its
inability to deliver any such Form or Certificate in which case such Lender
shall not be required to deliver any such Form or Certificate pursuant to this
Section 3.04(b). Notwithstanding anything to the contrary contained in Section
3.04(a), but subject to Section 11.04(b) and the immediately succeeding
sentence, (x) each Borrower shall be entitled, to the extent it is required to
do so by law, to deduct or withhold income or similar taxes imposed by the
United States (or any political subdivision or taxing authority hereof or
therein) from interest, fees or other amounts payable hereunder by such Borrower
for the account of any Lender which is not a United States person (as such term
is defined in Section 7701(a)(30) of the Code) for Federal income tax purposes
to the extent that such Lender has not provided to the Borrowers Internal
Revenue Service Forms that establish a complete exemption from such deduction or
withholding and (y) the Borrowers shall not be obligated pursuant to Section
3.04(a) hereof to gross-up payments to be made to any such Lender in respect of
income or similar taxes imposed by the United States if (I) such Lender has not
provided to the Borrowers the Internal Revenue Service Forms required to be
provided to the Borrowers pursuant to this Section 3.04(b) or (II) in the case
of a payment, other than interest, to a Lender described in clause (ii) of the
first sentence of this Section 3.04(b) above, to the extent that such Forms do
not establish a complete exemption from withholding of such taxes.
Notwithstanding anything to the contrary contained in the preceding sentence or
elsewhere in this Section 3.04 and except as set forth in Section 11.04(b), the
Borrowers agree to pay additional amounts and to indemnify each Lender in the
manner set forth in Section 3.04(a) (without regard to the identity of the
jurisdiction requiring the deduction or withholding) in respect of any Taxes
deducted or withheld by it as described in the immediately preceding sentence as
a result of any changes after the Original Effective Date in any applicable law,
treaty, governmental rule, regulation, guideline or order, or in the
interpretation thereof, relating to the deducting or withholding of such Taxes.

 

(c) If a Borrower pays any additional amount under this Section 3.04 to a Lender
and such Lender determines in its sole discretion that it has actually received
or realized in connection therewith any refund or any reduction of, or credit
against, its Tax liabilities in or with respect to the taxable year in which the
additional amount is paid, such Lender shall pay to the Borrower an amount that
such Lender shall, in its sole discretion, determine is equal to the net
benefit, after tax, which was obtained by the Lender in such year as a
consequence of such refund, reduction or credit. Such amount shall be paid as
soon as practicable after receipt or realization by such Lender of such refund,
reduction or credit. Nothing in this Section 3.04(c) shall require any Lender to
disclose or detail the basis of its calculation of the amount of any refund or
reduction of, or credit against, its tax liabilities or any other information to
any Borrower or any other Person.

 

(d) In the case of any Borrower that is not a United States person (as such term
is defined in Section 7701(a)(30) of the Code), each Lender shall use reasonable
efforts (consistent with legal and regulatory restrictions and subject to
overall policy considerations of such Lender) to file any certificate or
document or to furnish any information as reasonably requested by a Borrower
pursuant to any applicable treaty, law or regulation, if the making of such
filing or the furnishing of such information would avoid the need for or reduce
the amount of any amounts payable by a Borrower under Section 3.04(a) and would
not, in the reasonable

 

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judgment of such Lender, be disadvantageous to such Lender provided, however,
that nothing in this Section 3.04(d) shall require a Lender to disclose any
confidential information (including, without limitation, its tax returns or its
calculations).

 

SECTION 4. Conditions Precedent.

 

4.01 Conditions Precedent to the Second Restatement Effective Date. This
Agreement shall become effective on the date (the “Second Restatement Effective
Date”) on which each of the following conditions shall be satisfied:

 

(a) Execution of Agreement; Notes. (i) Each of Parent, Corp., each Agent and
each of the Lenders shall have signed a copy hereof (whether the same or
different copies) and shall have delivered the same to the Administrative Agent
at its Notice Office or, in the case of the Lenders and the Agents, shall have
given to the Administrative Agent telephonic (confirmed in writing), written or
facsimile transmission notice (actually received) at such office that the same
has been signed and mailed to it; and (ii) there shall have been delivered to
the Administrative Agent for the account of each Lender requesting the same, the
appropriate Notes executed by Parent and Corp., as applicable, in the amount,
maturity and as otherwise provided herein.

 

(b) Opinion of Counsel. The Administrative Agent shall have received an opinion,
addressed to each Agent and each of the Lenders and dated the Second Restatement
Effective Date, from Ram D. Wertheim, General Counsel of Parent and Corp., which
opinion shall be substantially in the form of Exhibit D hereto.

 

(c) Corporate Proceedings. (i) The Administrative Agent shall have received from
each of Parent and Corp. a certificate, dated the Second Restatement Effective
Date, signed by an Authorized Officer thereof in the form of Exhibit E with
appropriate insertions and deletions, together with (x) copies of its
certificate of incorporation, by-laws or other organizational documents and (y)
the resolutions relating to the Credit Documents which shall be satisfactory to
the Administrative Agent.

 

(ii) All corporate and legal proceedings and all instruments and agreements in
connection with the transactions contemplated by this Agreement and the other
Credit Documents shall be satisfactory in form and substance to the
Administrative Agent, and the Administrative Agent shall have received all
information and copies of all certificates, documents and papers, including good
standing certificates of recent date and any other records of corporate
proceedings and governmental approvals, if any, which the Administrative Agent
may have requested in connection therewith, such documents and papers, where
appropriate, to be certified by proper corporate or governmental authorities.

 

(d) Fees. The Borrowers shall have paid to the Administrative Agent and the
Lenders all fees and expenses (including, without limitation, legal fees and
expenses) agreed upon by such parties to be paid on or prior to such date.

 

(e) Existing Credit Agreement. On the Second Restatement Effective Date and
concurrently with the initial incurrence of Loans hereunder, (i) all Existing
Revolving Loans shall have been repaid in full in cash, together with accrued
but unpaid interest thereon, it being

 

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understood and agreed, however, that any Existing Lender may net fund any
Revolving Loans required to be made by it on the Second Restatement Effective
Date by permitting the principal amount of the Existing Revolving Loans made by
such Existing Lender to remain outstanding on the Second Restatement Effective
Date to satisfy such Existing Lender’s obligation to fund a like principal
amount of Revolving Loans to be incurred hereunder by the Borrowers on the
Second Restatement Effective Date, and for purposes of this Section 4.01(e) only
such outstanding principal amount shall be deemed outstanding as Revolving Loans
under this Agreement and such corresponding Existing Revolving Loans shall be
deemed to have been so repaid in full, and (ii) there shall have been paid in
cash in full all accrued but unpaid Fees under, and as defined in, the Existing
Credit Agreement (including, without limitation any Facility Fees) accrued but
unpaid prior to but excluding the Second Restatement Effective Date and all
other amounts, costs and expenses (including, without limitation, breakage
costs, if any, with respect to Eurodollar Loans thereunder) then owing to any of
the Existing Lenders and/or the Administrative Agent, as agent under the
Existing Credit Agreement, in each case to the satisfaction of the
Administrative Agent or the Existing Lenders, as the case may be, regardless of
whether or not such amounts would otherwise be due and payable at such time
pursuant to the terms of the Existing Credit Agreement and (iii) all outstanding
Notes (as defined in the Existing Credit Agreement) issued by Parent or Corp. to
the Existing Lenders under the Existing Credit Agreement shall be deemed
canceled.

 

The occurrence of the Second Restatement Effective Date shall constitute a
representation and warranty by each Borrower to the Agents and each of the
Lenders that all the conditions specified in Section 4.01 exist as of that time.
All the Notes, certificates, legal opinions and other documents and papers
referred to in this Section 4.01, unless otherwise specified, shall be delivered
to the Administrative Agent at the Administrative Agent’s Notice Office for the
account of each of the Lenders and, except for the Notes, in sufficient
counterparts for each of the Lenders and shall be satisfactory in form and
substance to the Lenders. The Administrative Agent shall give Parent, Corp. and
each Lender written notice that the Second Restatement Effective Date has
occurred.

 

4.02 Conditions Precedent to Loans. The obligation of each Lender to make any
Loans is subject, at the time of each such Loan, to the satisfaction of the
following conditions:

 

(a) Second Restatement Effective Date. The Second Restatement Effective Date
shall have occurred.

 

(b) Notice of Borrowing. The Administrative Agent shall have received a Notice
of Borrowing meeting the requirements of Section 1.03(a) with respect to each
incurrence of Revolving Loans and a Notice of Competitive Bid Borrowing meeting
the requirements of Section 1.04(a) with respect to each incurrence of
Competitive Bid Loans.

 

(c) No Default; Representations and Warranties. At the time of the incurrence of
each Loan and also after giving effect thereto, (i) there shall exist no Default
or Event of Default and (ii) all representations and warranties made by any
Borrower contained herein or in the other Credit Documents shall be true and
correct in all material respects with the same effect as though such
representations and warranties had been made on and as of the date of such Loan.

 

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(d) Financial Guaranty Insurance Policy. In the case of each DB Loan, Corp.
shall have issued a financial guaranty insurance policy in the form of Exhibit F
attached hereto (as appropriately completed, a “Financial Guaranty Insurance
Policy”), in support of the principal of and interest on such DB Loan, and such
Financial Guaranty Insurance Policy shall be in full force and effect. In
addition, in the case of a DB Loan which is an Alternate Currency Loan, Corp.
shall be permitted to Guarantee such DB Loan under the respective Alternate
Currency under applicable law.

 

(e) Opinion of Counsel. In the case of each DB Loan, the Administrative Agent
shall have received an opinion, addressed to each Agent and each of the Lenders
and dated the date of the incurrence of such DB Loan, from counsel to Corp.,
which opinion shall be substantially in the form of Exhibit L hereto.

 

The acceptance of the benefits of each Loan shall constitute a representation
and warranty by the respective Borrower to the Agents and each of the Lenders
that all of the applicable conditions specified in Section 4.02 exist as of that
time.

 

SECTION 5. Representations, Warranties and Agreements. In order to induce the
Lenders to enter into this Agreement and to make the Loans provided for herein,
each of Parent and Corp. makes the following representations and warranties to,
and agreements with, the Lenders, all of which shall survive the execution and
delivery of this Agreement and the making of the Loans:

 

5.01 Corporate Existence and Power. Parent and Corp. are corporations duly
organized, validly existing and in good standing under the laws of the
jurisdiction of their incorporation, are duly qualified to transact business in
every jurisdiction where, by the nature of their businesses, such qualification
is necessary and where the failure to be so qualified, either individually or in
the aggregate could reasonably be expected to have a Material Adverse Effect,
and have all corporate powers and all governmental licenses, authorizations,
consents and approvals required to carry on their businesses as now conducted
and where the failure to have such governmental licenses, authorizations,
consents and approvals could reasonably be expected to have a Material Adverse
Effect.

 

5.02 Corporate and Governmental Authorization; No Contravention. The execution,
delivery and performance by the Borrowers of this Agreement and the other Credit
Documents (i) are within each of the Borrower’s corporate powers, (ii) have been
duly authorized by all necessary corporate action, (iii) require no action by or
in respect of, or filing with, any governmental body, agency or official, (iv)
do not contravene, or constitute a default under, any provision of applicable
law or regulation or of the certificate of incorporation or by-laws of each of
the Borrowers or of any agreement, judgment, injunction, order, decree or other
instrument binding upon the Borrowers or any of their Subsidiaries, and (v) do
not result in the creation or imposition of any Lien on any asset of the
Borrowers or any of their Subsidiaries.

 

5.03 Binding Effect. This Agreement constitutes a valid and binding agreement of
each of the Borrowers enforceable in accordance with its terms, and the other
Credit Documents, when executed and delivered in accordance with this Agreement,
will constitute valid and binding obligations of each of the Borrowers
enforceable in accordance with their

 

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respective terms, provided that the enforceability hereof and thereof is subject
in each case to general principles of equity and to bankruptcy, insolvency and
similar laws affecting the enforcement of creditors’ rights generally.

 

5.04 Financial Information. (a) The consolidated balance sheet of Parent and its
Consolidated Subsidiaries as of December 31, 2002 and the related consolidated
statements of income, shareholders’ equity and cash flows for the Fiscal Year
then ended, reported on by PricewaterhouseCoopers LLP, copies of which have been
delivered to each of the Lenders fairly present, in conformity with GAAP or
Statutory Accounting Principles, as applicable consistently applied, the
consolidated financial position of Parent and its Consolidated Subsidiaries as
of such dates and their consolidated results of operations and cash flows for
such periods stated.

 

(b) Since December 31, 2002 there has been no event, act, condition or
occurrence having a Material Adverse Effect.

 

5.05 Litigation. There is no action, suit or proceeding pending, or to the
knowledge of the Borrowers threatened, against or affecting the Borrowers or any
of their Subsidiaries before any court or arbitrator or any governmental body,
agency or official which could have a Material Adverse Effect or which in any
manner draws into question the validity or enforceability of, or could impair
the ability of the Borrowers to perform their obligations under, this Agreement
or any of the other Credit Documents.

 

5.06 Compliance with ERISA. (a) Parent, Corp. and each member of the Controlled
Group have fulfilled their obligations under the minimum funding standards of
ERISA and the Code with respect to each Plan and are in compliance in all
material respects with the presently applicable provisions of ERISA and the
Code, and have not incurred any liability to the PBGC or a Plan under Title IV
of ERISA.

 

(b) Neither Parent nor Corp. nor any member of the Controlled Group is or ever
has been obligated to contribute to any Multiemployer Plan.

 

5.07 Taxes. There have been filed on behalf of Parent and its Subsidiaries all
Federal, state and local income, excise, property and other tax returns which
are required to be filed by them and all taxes due pursuant to such returns or
pursuant to any assessment received by or on behalf of Parent or any Subsidiary
have been paid. The charges, accruals and reserves on the books of each of
Parent and its Subsidiaries in respect of taxes or other governmental charges
are, in the opinion of each of Parent and Corp., adequate. United States income
tax returns of Parent and its Subsidiaries have been examined and closed through
the Fiscal Year ended December 31, 2002.

 

5.08 Subsidiaries. Each of Parent’s Subsidiaries is a corporation duly
organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation, is duly qualified to transact business in every
jurisdiction where, by the nature of its business, such qualification is
necessary and where the failure to be so qualified, either individually or in
the aggregate could reasonably be expected to have a Material Adverse Effect,
and has all corporate powers and all governmental licenses, authorizations,
consents and approvals required to carry on its business as now conducted and
where the failure to have such governmental licenses,

 

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authorizations, consents and approvals could reasonably be expected to have a
Material Adverse Effect. Parent has no Subsidiaries except those Subsidiaries
listed on Annex III, which accurately sets forth each such Subsidiary’s complete
name and jurisdiction of incorporation.

 

5.09 Not an Investment Company. No Borrower is an “investment company” within
the meaning of the Investment Company Act of 1940, as amended.

 

5.10 Public Utility Holding Company Act. No Borrower nor any of their
Subsidiaries is a “holding company”, or a “subsidiary company” of a “holding
company”, or an “affiliate” of a “holding company” or of a “subsidiary company”
of a “holding company”, as such terms are defined in the Public Utility Holding
Company Act of 1935, as amended.

 

5.11 Ownership of Property; Liens. Parent and its Consolidated Subsidiaries have
title of their properties sufficient for the conduct of their respective
businesses and none of such property is subject to any Lien except as permitted
in Section 7.01.

 

5.12 No Default. No Default or Event of Default has occurred and is continuing.

 

5.13 Full Disclosure. All information heretofore furnished by the Borrowers to
the Administrative Agent or any Lender for purposes of or in connection with
this Agreement or any transaction contemplated hereby is, and all such
information hereafter furnished by the Borrowers to the Administrative Agent or
any Lender will be, true, accurate and complete in every material respect or
based on reasonable estimates on the date as of which such information is stated
or certified. The Borrowers have disclosed to the Lenders in writing any and all
facts which could have or cause a Material Adverse Effect.

 

5.14 Compliance with Laws. Parent and each of its Subsidiaries is in compliance
with all applicable laws, except where any failure to comply with any such laws
would not, alone or in the aggregate, have a Material Adverse Effect.

 

5.15 Capital Stock. All Capital Stock, debentures, bonds, notes and all other
securities of each of Parent and its Subsidiaries presently issued and
outstanding are validly and properly issued in accordance with all applicable
laws, including, but not limited to, the “Blue Sky” laws of all applicable
states and the federal securities laws. The issued shares of Capital Stock of
each of Parent’s and Corp.’s Wholly-Owned Subsidiaries are owned by Parent or
Corp. free and clear of any Lien or adverse claim. At least a majority of the
issued shares of Capital Stock of each of Parent’s and Corp.’s other
Subsidiaries (other than Wholly-Owned Subsidiaries) is owned by Parent or Corp.
free and clear of any Lien or adverse claim.

 

5.16 Margin Stock. No Borrower nor any of their Subsidiaries are engaged
principally, or as one of their important activities, in the business of
purchasing or carrying any Margin Stock, and no part of the proceeds of any Loan
will be used to purchase or carry any Margin Stock, or be used for any purpose
which violates, or which is inconsistent with, the provisions of Regulation U or
X.

 

5.17 Insolvency. After giving effect to the execution and delivery of the Credit
Documents and the making of the Loans under this Agreement, no Borrower will be
“insolvent,” within the meaning of such term as defined in § 101 of Title 11 of
the United States Code or

 

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Section 2 of the Uniform Fraudulent Transfer Act, or any other applicable state
law pertaining to fraudulent transfers, as each may be amended from time to
time, or be unable to pay its debts generally as such debts become due or have
an unreasonably small capital to engage in any business or transaction, whether
current or contemplated.

 

5.18 Ranking. The Debt of each Borrower arising under or in connection with this
Agreement or any other Credit Document (i) constitutes and shall constitute a
senior unsecured obligation of such Borrower, (ii) ranks senior to, or pari
passu with, all other existing and future senior unsecured Debt of such Borrower
and (iii) ranks senior to any subordinated Debt of such Borrower.

 

SECTION 6. Affirmative Covenants. The Borrowers hereby covenant and agree that
on and as of the Second Restatement Effective Date and thereafter until the
Commitments have terminated, no Notes are outstanding and the Loans, together
with interest, Fees and all other obligations (other than any indemnities
described in Section 11.12 which are not then owing) incurred hereunder, are
paid in full:

 

6.01 Information Covenants. Parent and Corp. will furnish to each Lender:

 

(a) as soon as available and in any event within 60 days after the end of each
of the first three quarterly fiscal periods in each Fiscal Year of Parent and
Corp., consolidated balance sheets of each of Parent and its Subsidiaries and
Corp. and its Subsidiaries as at the end of such period and the related
consolidated statements of income, changes in stockholders’ equity and cash
flows of each of Parent and its Subsidiaries and Corp. and its Subsidiaries for
such period and (in the case of the second and third quarterly periods) for the
period from the beginning of the current Fiscal Year to the end of such
quarterly period, setting forth in each case in comparative form the
consolidated figures for the corresponding periods of the previous Fiscal Year,
all in reasonable detail and certified by an Authorized Officer of each of
Parent and Corp. as presenting fairly, in accordance with GAAP (except as
specifically set forth therein; provided any exceptions or qualifications
thereto must be acceptable to the Required Lenders) on a basis consistent with
such prior fiscal periods, the information contained therein, subject to changes
resulting from normal year-end audit adjustments;

 

(b) as soon as available and in any event within 120 days after the end of each
Fiscal Year of Parent and Corp., consolidated balance sheets of each of Parent
and its Subsidiaries and Corp. and its Subsidiaries as at the end of such year
and the related consolidated statements of income, operations, changes in
stockholders’ equity and cash flows of each of Parent and its Subsidiaries and
Corp. and its Subsidiaries for such Fiscal Year, setting forth in each case in
comparative form the consolidated figures for the previous fiscal year, all in
reasonable detail and accompanied by a report thereon of PricewaterhouseCoopers
LLP or other independent public accountants of recognized national standing
selected by Parent, which report shall state that such consolidated financial
statements present fairly the consolidated financial position of each of Parent
and its Subsidiaries and Corp. and its Subsidiaries as at the dates indicated
and the consolidated results of their operations and cash flows for the periods
indicated in conformity with GAAP applied on a basis consistent with prior years
(except as

 

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otherwise specified in such report; provided any exceptions or qualifications
thereto must be acceptable to the Required Lenders) and that the audit by such
accountants in connection with such consolidated financial statements has been
made in accordance with generally accepted auditing standards;

 

(c) within five Business Days after any Borrower becomes aware of the occurrence
of any Default, a certificate of an Authorized Officer of each of the Borrowers
setting forth the details thereof and the action which the Borrowers are taking
or propose to take with respect thereto;

 

(d) promptly upon the mailing thereof to the security holders of the Borrowers
generally, copies of all financial statements, reports and proxy statements so
mailed;

 

(e) promptly upon the filing thereof, copies of all registration statements
(other than the exhibits thereto and any registration statements on Form S-8 or
its equivalent) and annual, quarterly or monthly reports which the Borrowers
shall have filed with the Securities and Exchange Commission or any national
securities exchange;

 

(f) if and when Parent, Corp. or any member of the Controlled Group (i) gives or
is required to give notice to the PBGC of any “reportable event” (as defined in
Section 4043 of ERISA) with respect to any Plan which might constitute grounds
for a termination of such Plan under Title IV of ERISA, or knows that the plan
administrator of any Plan has given or is required to give notice of any such
reportable event, a copy of the notice of such reportable event given or
required to be given to the PBGC; (ii) receives notice of complete or partial
withdrawal liability under Title IV of ERISA, a copy of such notice; or (iii)
receives notice from the PBGC under Title IV of ERISA of an intent to terminate
or appoint a trustee to administer any Plan, a copy of such notice;

 

(g) promptly after any Borrower knows of the commencement thereof, notice, of
any litigation, dispute or proceeding involving a claim against any of the
Borrowers and/or any Subsidiary for $10,000,000 or more in excess of amounts
covered in full by applicable insurance;

 

(h) from time to time such additional information regarding the financial
position or business of the Borrowers and their Subsidiaries as the
Administrative Agent, at the request of any Lender, may reasonably request;

 

(i) at the request of any Lender, promptly after the filing thereof, a copy of
the annual statements for each calendar year and quarterly statements for each
calendar quarter as filed with the New York Insurance Department or other then
comparable agency of other jurisdictions and the financial statements of Corp.
for each calendar year or quarter prepared in accordance with Statutory
Accounting Principles accompanied by a report thereon of the independent public
accountants of Parent referred to in paragraph (b) above; and

 

(j) at the request of any Lender, at any time when a DB Loan is outstanding,
quarterly and annual summary financial statements of the applicable Designated
Borrower as promptly as possible after the end of each fiscal quarter and fiscal
year of such Designated Borrower.

 

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6.02 Books, Records and Inspections. The Borrowers will (i) keep, and will cause
each Subsidiary to keep, proper books of record and account in which full, true
and correct entries in conformity with GAAP or Statutory Accounting Principles,
as applicable, shall be made of all dealings and transactions in relation to its
business and activities; and (ii) permit, and will cause each Subsidiary to
permit, representatives of any Lender at such Lender’s expense prior to the
occurrence of an Event of Default and at the Borrowers’ expense after the
occurrence of an Event of Default to visit and inspect any of their respective
properties, to examine their respective books and records and to discuss their
respective affairs, finances and accounts with their respective officers,
employees and independent public accountants. The Borrowers agree to cooperate
and assist in such visits and inspections, in each case at such reasonable times
and as often as may reasonably be desired.

 

6.03 Maintenance of Existence. Each of the Borrowers shall maintain its
existence and carry on its business in substantially the same manner and in
substantially the same fields as such business is now carried on and maintained.

 

6.04 Compliance with Laws; Payment of Taxes. The Borrowers will, and will cause
each of their Subsidiaries and each member of the Controlled Group to, comply
with applicable laws (including but not limited to ERISA), regulations and
similar requirements of governmental authorities (including but not limited to
the PBGC), except where (i) the necessity of such compliance is being contested
in good faith through appropriate proceedings diligently pursued; and (ii) any
failure to comply with any such laws would not, alone or in the aggregate, have
a Material Adverse Effect. The Borrowers will, and will cause each of their
Subsidiaries to, pay promptly when due all taxes, assessments, governmental
charges, claims for labor, supplies, rent and other obligations which, if
unpaid, might become a lien against the property of the Borrowers or any
Subsidiary, except liabilities being contested in good faith by appropriate
proceedings diligently pursued.

 

6.05 Insurance. The Borrowers will maintain, and will cause each of their
Material Subsidiaries to maintain (either in the name of the Borrowers or in
such Material Subsidiary’s own name), with financially sound and reputable
insurance companies, insurance on all their property in at least such amounts
and against at least such risks as are usually insured against in the same
general area by companies of established repute engaged in the same or similar
businesses.

 

6.06 Maintenance of Property. The Borrowers shall, and shall cause each Material
Subsidiary to, maintain all of their properties and assets in good condition,
repair and working order, ordinary wear and tear excepted.

 

SECTION 7. Negative Covenants. The Borrowers hereby covenant and agree that on
and as of the Second Restatement Effective Date and thereafter until the
Commitments have terminated, no Notes are outstanding and the Loans, together
with interest, Fees and all other obligations (other than any indemnities
described in Section 11.12 which are not then owing) incurred hereunder, are
paid in full:

 

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7.01 Liens. Neither Parent nor any of its Consolidated Subsidiaries will create,
assume or suffer to exist any Lien on any asset now owned or hereafter acquired
by it, except:

 

(i) Liens securing any loan to be made under the Credit Agreement among Corp.,
the banks signatory thereto and Credit Suisse First Boston, New York Branch,
originally dated as of December 29, 1989, as amended and restated on October 1,
1997 and as may be amended thereafter from time to time;

 

(ii) Liens created on certain insurance premiums by a Trust Agreement effective
December 31, 1989 between Municipal Bond Investors Assurance Corporation, MBIA
Insurance Corp. of Illinois and the trustee thereunder, as amended on February
28, 1995 and as may be amended from time to time thereafter;

 

(iii) as to Corp., Liens (in addition to Liens permitted under Section 7.01(i),
(iv) and (v)) in an aggregate principal amount of up to $10,000,000;

 

(iv) Liens not securing Debt which are incurred in the ordinary course of
business;

 

(v) Liens securing repurchase agreements constituting a borrowing of funds by
Parent or any Subsidiary of Parent in the ordinary course of business for
liquidity purposes; and

 

(vi) Liens securing any Conduit Debt or Insured Debt (or any guaranty made by
Corp. of such Conduit Debt or Insured Debt, as the case may be), provided that
any such Liens attach only to the underlying assets that are the subject of such
Conduit Debt or Insured Debt, as applicable.

 

7.02 Dissolution. No Borrower shall suffer or permit dissolution or liquidation
either in whole or in part or redeem or retire any shares of their own stock,
except through corporate reorganization to the extent permitted by Section 7.03.

 

7.03 Consolidations, Mergers and Sales of Assets. The Borrowers will not
consolidate or merge with or into, or sell, lease or otherwise transfer all or
any substantial part of their assets to, any other Person, provided that (a) any
Borrower (other than any Designated Borrower) may merge with another Person if
(i) such Person was organized under the laws of the United States of America or
one of its states, (ii) one of the Borrowers is the corporation surviving such
merger and (iii) immediately after giving effect to such merger, no Default
shall have occurred and be continuing, and (b) Subsidiaries of the Borrowers may
merge with one another.

 

7.04 Use of Proceeds. No portion of the proceeds of the Loans will be used by
the Borrowers or any Subsidiary (i) directly or indirectly, for the purpose,
whether immediate, incidental or ultimate, of purchasing or carrying any Margin
Stock, or (ii) for any purpose in violation of any applicable law or regulation.

 

7.05 Change in Fiscal Year. Neither Parent nor Corp. shall change its Fiscal
Year without the consent of the Required Lenders.

 

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7.06 Transactions with Affiliates. Neither Parent nor any of its Subsidiaries
shall enter into, or be a party to, any transaction with any Affiliate of Parent
or such Subsidiary (which Affiliate is not one of the Borrowers or a
Subsidiary), except as permitted by law and in the ordinary course of business
and pursuant to reasonable terms.

 

7.07 Leverage Ratio. Parent and Corp. will not permit the ratio of Consolidated
Total Debt to Consolidated Total Capitalization at any time to exceed 0.30:1.00.

 

7.08 Minimum Net Worth. Parent and Corp. will not permit Consolidated Net Worth
to be less than $2,500,000,000 at any time.

 

SECTION 8. Defaults.

 

8.01 Events of Default. Upon the occurrence of any of the following specified
events (each, an “Event of Default”):

 

(a) any Borrower shall fail to pay when due any principal of any Loan, or shall
fail to pay any interest on any Loan within three Business Days after such
interest shall become due, or shall fail to pay any fee or other amount payable
hereunder within five Business Days after such fee or other amount becomes due;
or

 

(b) any Borrower shall fail to observe or perform any covenant contained in
Sections 6.01(c), 6.02(ii), 6.03, 6.06, 7.02, 7.03, 7.04 or 7.08; or

 

(c) any Borrower shall fail to observe or perform any covenant contained in
Section 7.01 for five days after the earlier of (i) the first day on which any
Borrower has knowledge of such failure or (ii) written notice thereof has been
given to any Borrower by the Administrative Agent at the request of any Lender;
or

 

(d) any Borrower shall fail to observe or perform any covenant or agreement
contained herein (other than those covered by clause (a), (b) or (c) above, but
including, without limitation, any covenant contained in Section 7.07) for 30
days after the earlier of (i) the first day on which any Borrower has knowledge
of such failure or (ii) written notice thereof has been given to any Borrower by
the Administrative Agent at the request of any Lender; or

 

(e) any representation, warranty, certification or statement made or deemed made
by any Borrower in Section 5 of this Agreement or in any certificate, financial
statement or other document delivered pursuant to this Agreement shall prove to
have been incorrect or misleading in any material respect when made (or deemed
made); or

 

(f) Parent or any Subsidiary shall fail to make any payment in respect of Debt
outstanding in an aggregate principal amount equal to or in excess of
$10,000,000 (other than the Notes) when due at final stated maturity (after
giving effect to any applicable grace period); or

 

(g) any event or condition shall occur which results in the acceleration of the
maturity of Debt outstanding in an aggregate amount equal to or in excess of
$10,000,000 of Parent or any Subsidiary or the mandatory prepayment or purchase
of such Debt by Parent (or its designee) or such Subsidiary (or its designee)
prior to the scheduled maturity thereof; or

 

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(h) Parent or any Material Subsidiary shall commence a voluntary case or other
proceeding seeking liquidation, reorganization or other relief with respect to
themselves or their debts under any bankruptcy, insolvency or other similar law
now or hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of them or any substantial part
of their property, or shall consent to any such relief or to the appointment of
or taking possession by any such official in an involuntary case or other
proceeding commenced against them, or shall make a general assignment for the
benefit of creditors, or shall fail generally, or shall admit in writing their
inability, to pay their debts as they become due, or shall take any corporate
action to authorize any of the foregoing, or shall become or be declared by a
court of competent jurisdiction to be insolvent; or

 

(i) an involuntary case or other proceeding shall be commenced against Parent or
any Material Subsidiary seeking liquidation, reorganization or other relief with
respect to them or their debts under any bankruptcy, insolvency or other similar
law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of them or any
substantial part of their property, and such involuntary case or other
proceeding shall remain undismissed and unstayed for a period of 60 days; or an
order for relief shall be entered against Parent or any Material Subsidiary
under the federal bankruptcy laws as now or hereafter in effect; or

 

(j) Parent, Corp. or any member of the Controlled Group shall fail to pay when
due any material amount which they shall have become liable to pay to the PBGC
or to a Plan under Title IV of ERISA; or the PBGC shall institute proceedings
under Title IV of ERISA to terminate or to cause a trustee to be appointed to
administer any such Plan or Plans or a proceeding shall be instituted by a
fiduciary of any such Plan or Plans to enforce Section 515 or 4219(c)(5) of
ERISA and such proceeding shall not have been dismissed within 30 days
thereafter; or a condition shall exist by reason of which the PBGC would be
entitled to obtain a decree adjudicating that any such Plan or Plans must be
terminated; or

 

(k) one or more judgments or orders for the payment of money in an aggregate
amount in excess of $25,000,000 shall be rendered against Parent or any
Subsidiary and such judgment or order shall continue unsatisfied and unstayed
for a period of 30 days; or

 

(l) a federal tax lien in excess of $10,000,000 shall be filed against Parent or
any Subsidiary under Section 6323 of the Code or a lien in excess of $10,000,000
of the PBGC shall be filed against any Parent or any Subsidiary under Section
4068 of ERISA and in either case such lien shall remain undischarged for a
period of 25 days after the date of filing; or

 

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(m) (i) any Person or two or more Persons acting in concert shall have acquired
beneficial ownership (within the meaning of Rule 13d-3 of the Securities and
Exchange Commission under the Exchange Act) of 40% or more of the outstanding
shares of the voting stock of Parent; or (ii) as of any date a majority of the
Board of Directors of Parent consists of individuals who were not either (A)
directors of Parent as of the corresponding date of the previous year, (B)
selected or nominated to become directors by the Board of Directors of Parent of
which a majority consisted of individuals described in clause (A), or (C)
selected or nominated to become directors by the Board of Directors of Parent of
which a majority consisted of individuals described in clause (A) and
individuals described in clause (B); or

 

(n) Parent shall at any time or times and for any reason cease to own (either
directly or indirectly through a wholly-owned intermediate Subsidiary) all of
the Capital Stock or other ownership interests (except for director’s qualifying
shares) of Corp.; or

 

(o) at any time when any DB Loan is outstanding, the respective Financial
Guaranty Insurance Policy or any material provision thereof shall cease to be in
full force or effect or Corp. shall deny or disaffirm its obligations under such
Financial Guaranty Insurance Policy;

 

then, and in every such event, the Administrative Agent shall (i) if requested
by the Required Lenders, by notice to Parent and Corp. terminate the Commitments
and they shall thereupon terminate, and (ii) if requested by the Required
Lenders, by notice to Parent and Corp. declare the Notes (together with accrued
interest thereon) and all other amounts payable hereunder and under the other
Credit Documents to be, and the Notes (together with all accrued interest
thereon) and all other amounts payable hereunder and under the other Credit
Documents shall thereupon become, immediately due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Borrowers; provided that if any Event of Default specified
in clause (h) or (i) above occurs with respect to Parent or Corp., without any
notice to Parent or Corp. or any other act by the Administrative Agent or the
Lenders, the Total Commitment shall thereupon automatically terminate and the
Notes (together with accrued interest thereon) and all other amounts payable
hereunder and under the other Credit Documents shall automatically become
immediately due and payable without presentment, demand, protest or other notice
of any kind, all of which are hereby waived by the Borrowers; provided, further,
that, except in the case of an Event of Default under Section 8.01(o), the
principal of and interest on DB Loans shall not become due and payable pursuant
to this Section 8.01 prior to their respective DB Loan Maturity Date.
Notwithstanding the foregoing, the Administrative Agent shall have available to
it all other remedies at law or equity, and shall exercise any one or all of
them at the request of the Required Lenders.

 

8.02 Notice of Default. The Administrative Agent shall give notice to the
Borrowers of any Default under Sections 8.01(c) or 8.01(d) promptly upon being
requested to do so by any Lender and shall thereupon notify all the Lenders
thereof.

 

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SECTION 9. Definitions.1 As used herein, the following terms shall have the
meanings herein specified unless the context otherwise requires. Defined terms
in this Agreement shall include in the singular number the plural and in the
plural the singular:

 

“Absolute Rate” shall mean an interest rate (rounded to the nearest .0001)
expressed as a decimal.

 

“Absolute Rate Borrowing” shall mean a Competitive Bid Borrowing with respect to
which a Borrower has requested that the Bidder Lenders offer to make Competitive
Bid Loans at Absolute Rates.

 

“Administrative Agent” shall have the meaning provided in the first paragraph of
this Agreement.

 

“Affiliate” shall mean, with respect to any Person, any other Person directly or
indirectly controlling (including but not limited to all directors and officers
of such Person), controlled by, or under direct or indirect common control with
such Person. A Person shall be deemed to control a corporation if such Person
possesses, directly or indirectly, the power (i) to vote 10% or more of the
securities having ordinary voting power for the election of directors of such
corporation or (ii) to direct or cause the direction of the management and
policies of such corporation, whether through the ownership of voting
securities, by contract or otherwise.

 

“Agents” shall mean the Administrative Agent, the Syndication Agent and the
Documentation Agent.

 

“Aggregate Loan Outstandings” shall have the meaning provided in Section
3.02(a).

 

“Agreement” shall mean this Second Amended and Restated Credit Agreement, as the
same may be from time to time modified, amended and/or supplemented.

 

“Alternate Currency” shall mean each Primary Alternate Currency and each Other
Alternate Currency.

 

“Alternate Currency Loan” shall mean any Loan denominated in an Alternate
Currency.

 

“Applicable Margin” shall mean, as of any date, with respect to (i) any
Eurodollar Loan or Base Rate Loan, a percentage per annum set forth below under
the caption “Eurodollar Rate” or “Base Rate” as applicable, determined, in each
case, by reference to (x) for Revolving Loans incurred by Parent, the Applicable
Public Rating in effect on such date as set forth below under the caption
“Parent’s Public Rating S&P/Moody’s” and (y) for Revolving Loans incurred by
Corp or a Designated Borrower, the Applicable Public Rating in effect on such
date as set forth below under the caption “Corp’s Public Rating S&P/Moody’s” and
(ii) any Facility Fee,

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

1 All interest rate definitions (and related definitions) must be conformed to
Barclays’ standard.

 

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the Applicable Margin per annum set forth below under the caption “Facility Fee”
determined, in each case, by reference to the lower of Parent’s and Corp’s
Applicable Public Rating in effect on such date as set forth below under the
captions “Parent’s Public Rating S&P/Moody’s” and “Corp’s Public Rating
S&P/Moody’s” respectively:

 

Parent’s Public Rating
S&P/Moody’s

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

  

Corp’s Public

Rating S&P/Moody’s

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

  

Eurodollar Rate

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

  

Base Rate

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

  

Facility Fee

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

Level 1

AA/Aa2 or above

  

Level 1

AAA/Aaa

   0.18%    0%    0.07%

Level 2

AA-/Aa3

  

Level 2

AA+/Aa1

   0.28%    0%    0.08%

Level 3

A+/ A1

  

Level 3

AA / Aa2

   0.38%    0%    0.09%

Level 4

A / A2

  

Level 4

AA-/ Aa3

   0.48%    0%    0.10%

Level 5

A-/A3

  

Level 5

A+ /A1

   0.88%    0%    0.15%

Level 6

BBB+/Baa1

  

Level 6

A / A2

   0.98%    0%    0.16%

Level 7

BBB/Baa2 or lower

  

Level 7

A-/A3 or lower

   1.08%    0%    0.17%

 

provided that, (A) notwithstanding anything to the contrary set forth in the
grid above (and notwithstanding the Applicable Public Rating at the time), upon
the occurrence and during the continuance of any Event of Default, the
Applicable Margin shall be the rate described above in Level 7; (B) for purposes
of the foregoing, in the event of a split in the Applicable Public Rating from
Moody’s and S&P, the applicable level shall be (1) the lower of such ratings in
the event such ratings are one level apart, (2) midpoint (if any) of such levels
in the event such ratings are two or more levels apart and (3) the lower of the
two intermediate ratings in the event there is no midpoint rating; (C) if at any
time Parent or Corp., as the case may be, does not have an Applicable Public
Rating with either Moody’s or S&P (other than by reason of the circumstances
referred to in the last sentence of this definition), the Applicable Margin as
set forth in Level 7 will apply; (D) if at any time either Moody’s or S&P shall
not have in effect an Applicable Public Rating, the Applicable Margin shall be
determined solely by the Applicable Public Rating established by the rating
agency that does have an Applicable Public Rating then in effect; and (E) if at
any time the Applicable Public Ratings established or deemed to have been
established by Moody’s and S&P shall be changed (other than as a result of a
change in the rating system of Moody’s or S&P), such change shall be effective
as of the date on which it is first announced by the applicable rating agency.
Each change in the Applicable Margin shall apply during the period commencing on
the effective date of such change and ending on the date immediately preceding
the effective date of the next such change. If the rating system of Moody’s or
S&P

 

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shall change, or if either such rating agency shall cease to be in the business
of providing the Applicable Public Rating, Parent (on its own behalf and/or on
behalf of Corp.) and the Lenders shall negotiate in good faith to amend this
definition to reflect such changed rating system or the unavailability of
ratings from such rating agency and, pending the effectiveness of any such
amendment, the Applicable Margin shall be determined by reference to the rating
most recently in effect prior to such change or cessation.

 

“Applicable Public Rating” shall mean, as of any date, the highest rating that
has been most recently announced by S&P and Moody’s (i) in respect of Parent,
for its long-term senior unsecured debt and (ii) in respect of Corp., for its
insurer claims paying ability.

 

“Approved Currency” shall mean each of Dollars and each Primary Alternate
Currency.

 

“Assignment Agreement” shall mean the Assignment Agreement in the form of
Exhibit G (appropriately completed).

 

“Associated Cost Rate” shall mean, for any Revolving Loan or Competitive Bid
Loan (constituting a Eurodollar Loan), in each case, denominated in Pounds
Sterling or Euros, the rate per annum calculated in accordance with Annex IV.

 

“Assuming Lender” shall have the meaning provided in Section 1.16.

 

“Authorized Officer” shall mean any senior officer of any Borrower designated as
such in writing to the Administrative Agent by such Borrower.

 

“Barclays” shall mean Barclays Bank plc.

 

“Base Rate” shall mean, at any time, the higher of (i) the rate which is  1/2 of
1% in excess of the Federal Funds Effective Rate and (ii) the Prime Lending
Rate.

 

“Base Rate Loan” shall mean each Revolving Loan denominated in Dollars
designated or deemed designated as a Base Rate Loan by the respective Borrower
at the time of the incurrence thereof or conversion thereof (as applicable).

 

“Bidder Lender” shall mean each Lender that has notified in writing (and has not
withdrawn such notice) the Administrative Agent that it desires to participate
generally in the bidding arrangements relating to Competitive Bid Borrowings.

 

“Borrowers” shall mean Parent, Corp. and each Designated Borrower, if any.

 

“Borrowing” shall mean (i) the incurrence by a single Borrower of Revolving
Loans denominated in Dollars that are Base Rate Loans on a pro rata basis from
all Lenders; (ii) the incurrence by a single Borrower of Revolving Loans of a
single Approved Currency that are Eurodollar Loans on a pro rata basis from all
Lenders, on a given date (or resulting from conversions on a given date), having
the same Interest Period; and (iii) a Competitive Bid Borrowing, provided that
(x) Base Rate Loans incurred pursuant to Section 1.11(b) shall be considered
part of any related Borrowing of Eurodollar Loans and (y) each Borrowing
applicable

 

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to each of the Existing Competitive Bid Loans outstanding on the Restatement
Effective Date shall continue to be applicable thereto as if the Existing Credit
Agreement had not been amended and restated as herein provided (although such
Existing Competitive Bid Loans, shall constitute Competitive Bid Loans, as
provided for in this Agreement).

 

“Business Day” shall mean (i) for all purposes other than as covered by clause
(ii) below, any day excluding Saturday, Sunday and any day which shall be in the
City of New York a legal holiday or a day on which banking institutions are
authorized by law or other governmental actions to close, (ii) with respect to
all notices and determinations in connection with, and payments of principal and
interest on, Eurodollar Loans and Competitive Bid Loans (made pursuant to a
Spread Borrowing), any day which is a Business Day described in clause (i) and
which is also a day for trading by and between banks in the London interbank
Eurodollar market, (iii) with respect to any notices or determinations in
respect of Euros, which is customarily a “Business Day” for such notices or
determinations and (iv) with respect to any notices or determinations in respect
of Japanese Yen, which is customarily a “Business Day” for such notices or
determinations.

 

“Capital Stock” means any nonredeemable capital stock of Parent or any
Consolidated Subsidiary (to the extent issued to a Person other than the
Borrowers), whether common or preferred.

 

“Code” shall mean the Internal Revenue Code of 1986, as amended from time to
time and the regulations promulgated and the rulings issued thereunder. Section
references to the Code are to the Code, as in effect on the Second Restatement
Effective Date and any subsequent provisions of the Code, amendatory thereof,
supplemental thereto or substituted therefor.

 

“Commitment” shall mean, with respect to each Lender, at any time, the amount
set forth opposite such Lender’s name on Annex I, as the same may be increased
pursuant to Section 1.16 and/or reduced pursuant to Sections 2.02, 2.03 or 8.01.

 

“Commitment Assumption Agreement” shall mean each Commitment Assumption
Agreement in the form of Exhibit H attached hereto executed in accordance with
Section 1.16.

 

“Commitment Assumption Date” shall mean the Business Day following the date on
which each Commitment Assumption Agreement is delivered to the Administrative
Agent pursuant to Section 1.16.

 

“Competitive Bid Borrowing” shall mean a Borrowing by a single Borrower of
Competitive Bid Loans pursuant to Section 1.04.

 

“Competitive Bid Loan” shall have the meaning specified in Section 1.01(b).

 

“Competitive Bid Note” shall have the meaning provided in Section 1.06(a).

 

“Conduit Debt” shall mean any debt of a special purpose entity that is
consolidated on Parent’s financial statements in accordance with GAAP, provided
that (i) the proceeds of such debt are used by such special purpose entity to
make loans to, or to purchase

 

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assets from, any Person that is not an Affiliate of Parent, in the ordinary
course of business and (ii) such debt and/or payment with respect to accounts
receivable and other assets underlying such debt are guaranteed by Corp., in the
ordinary course of business.

 

“Consolidated Net Worth” shall mean the Net Worth of Parent and its Subsidiaries
determined on a consolidated basis.

 

“Consolidated Subsidiary” shall mean at any date any Subsidiary or other entity
the accounts of which, in accordance with GAAP, would be consolidated with those
of Parent in its consolidated financial statements as of such date.

 

“Consolidated Total Capitalization” shall mean, as of any date of determination,
the sum of (i) Consolidated Total Debt and (ii) Consolidated Net Worth.

 

“Consolidated Total Debt” shall mean, as of any date of determination, all Debt
of Parent and its Subsidiaries on such date determined on a consolidated basis.

 

“Corp.” shall have the meaning provided in the first paragraph of this
Agreement.

 

“Controlled Group” shall mean all members of a controlled group of corporations
and all trades or businesses (whether or not incorporated) under common control
which, together with either Parent or Corp., are treated as a single employer
under Section 414 of the Code.

 

“Credit Documents” shall mean this Agreement, the Notes and each Financial
Guaranty Insurance Policy delivered pursuant to Section 4.02(d).

 

“DB Assumption Agreement” shall mean an Assumption Agreement in the form of
Exhibit I attached hereto executed in accordance with Section 1.17.

 

“DB Loan Maturity Date” shall mean (a) with respect to each DB Loan constituting
a Revolving Loan, the maturity date selected by the respective Designated
Borrower in accordance with Section 1.03(a) as being applicable to such DB Loan,
which maturity date shall not be more than 180 days after the date of incurrence
of such DB Loan (and in no event later than the Final Maturity Date) and (b)
with respect to each DB Loan constituting a Competitive Bid Loan, the maturity
of such Competitive Bid Loan selected in accordance with Section 1.04(a).

 

“DB Loans” shall mean any Loans incurred by a Designated Borrower.

 

“Debt” of any Person shall mean at any date, without duplication, (i) all
obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (iii)
all obligations of such Person to pay the deferred purchase price of property or
services, except trade accounts payable arising in the ordinary course of
business, (iv) all obligations of such Person as lessee under capital leases,
(v) all obligations of such Person to reimburse any bank or other Person in
respect of amounts payable under a banker’s acceptance, (vi) all Redeemable
Preferred Stock of such Person (in the event such Person is a corporation),
(vii) all obligations (absolute or contingent) of such Person to reimburse any
bank or other Person in respect of amounts paid under a letter of credit or

 

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similar instrument, (viii) all Debt of others secured by a Lien on any asset of
such Person, whether or not such Debt is assumed by such Person, (ix) all Debt
of others Guaranteed by such Person and (x) solely for the purpose of
determining the ratio of Consolidated Total Debt to Consolidated Total
Capitalization pursuant to Section 7.07, obligations under any repurchase
agreements secured by Liens constituting a borrowing of funds for a period
exceeding 90 days (other than obligations under such repurchase agreements
entered into by Parent or any of its Subsidiaries in the ordinary course of
business in connection with the asset management business of MBIA Asset
Management and its Subsidiaries); provided, that notwithstanding the foregoing,
the following shall not constitute “Debt” of any Person: (I) the obligations
referred to in the parenthetical in clause (x) above, (II) investment agreements
entered into by Parent or any of its Subsidiaries in the ordinary course of
business in connection with the asset management business of MBIA Asset
Management and its Subsidiaries, (III) in the case of Corp., the Debt of others
guaranteed by Corp. in the ordinary course of its business and (IV) any Conduit
Debt and any Insured Debt or any guaranty thereof by Corp. in the ordinary
course of business.

 

“Default” shall mean any event, act or condition which with notice or lapse of
time, or both, would constitute an Event of Default.

 

“Defaulting Lender” shall mean any Lender with respect to which a Lender Default
is in effect.

 

“Designated Borrower” shall mean each Person designated as a Designated Borrower
in accordance with Section 1.17.

 

“Documentation Agent” shall have the meaning provided in the first paragraph of
this Agreement.

 

“Dollar Equivalent” shall mean, at any time for the determination thereof, the
amount of Dollars which could be purchased with the amount of the relevant
Alternate Currency involved in such computation at the spot exchange rate
therefor as quoted by the Administrative Agent as of 11:00 A.M. (London time) on
the date two Business Days prior to the date of any determination thereof for
purchase on such date.

 

“Dollars” and the sign “$” shall each mean freely transferable lawful money of
the United States.

 

“EMU Legislation” shall mean the legislative measures of the European Council
for the introduction of, changeover to or operation of a single or unified
European currency.

 

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder. Section references to ERISA are to ERISA, as in effect as of the
Second Restatement Effective Date and any subsequent provisions of ERISA,
amendatory thereof, supplemental thereto or substituted therefor.

 

“Euro” shall mean the single currency of participating member states of the
European Union.

 

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“Euro Equivalent” shall mean, at any time for the determination thereof, the
amount of Euros which could be purchased with the amount of Dollars involved in
such computation at the spot exchange rate therefor as quoted by Barclays as of
11:00 A.M. (London time) on the date two Business Days prior to the date of any
determination thereof for purchase on such date.

 

“Euro LIBOR” shall mean, for each Interest Period applicable to any Loan
denominated in Euros, the rate per annum that appears on page 3750 (or other
appropriate page if such currency does not appear on such page) of the Dow Jones
Telerate Screen (or any successor page) for Euro deposits with maturities
comparable to such Interest Period as of 11:00 A.M. (London time) on the date
which is two Business Days prior to the commencement of such Interest Period or,
if such a rate does not appear on the Dow Jones Telerate Screen (or any
successor page), the offered quotations to first-class banks in the London
interbank market by Barclays for Euro deposits of amounts in same day funds
comparable to the outstanding principal amount of such Loan with maturities
comparable to such Interest Period determined as of 11:00 A.M. (London time) on
the date which is two Business Days prior to the commencement of such Interest
Period.

 

“Eurodollar Loan” shall mean each Revolving Loan that at the election of any
Borrower is bearing interest by reference to LIBOR.

 

“Event of Default” shall have the meaning specified in Section 8.01.

 

“Exchange Act” shall mean the U.S. Securities Exchange Act of 1934, as amended.

 

“Existing Competitive Bid Loans” shall mean each “Competitive Bid Loan” under,
and as defined in, the Existing Credit Agreement.

 

“Existing Credit Agreement” shall have the meaning provided in the first WHEREAS
clause of this Agreement.

 

“Existing Lenders” shall mean each of the lenders party to the Existing Credit
Agreement on the Second Restatement Effective Date.

 

“Existing Revolving Loan” shall mean each “Revolving Loan” under, and as defined
in, the Existing Credit Agreement.

 

“Facility Fees” shall have the meaning specified in Section 2.01(a).

 

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

 

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“Fees” shall mean all amounts payable pursuant to, or referred to in, Section
2.01.

 

“Final Maturity Date” shall mean the date occurring 364 days after the Second
Restatement Effective Date, or such later date to which the Final Maturity Date
shall have been extended pursuant to Section 1.15.

 

“Financial Guaranty Insurance Policy” shall have the meaning specified in
Section 4.02(d).

 

“Fiscal Year” means any fiscal year of the Borrowers.

 

“GAAP” shall mean generally accepted accounting principles in the United States
of America as in effect on the date of this Agreement.

 

“Guarantee” by any Person means any obligation, contingent or otherwise, of such
Person directly or indirectly guaranteeing any Debt or other obligation of any
other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such Person (i) to
secure, purchase or pay (or advance or supply funds for the purchase or payment
of) such Debt or other obligation (whether arising by virtue of partnership
arrangements, by agreement to keep-well, to purchase assets, goods, securities
or services, to provide collateral security, to take-or-pay, or to maintain
financial statement conditions or otherwise) or (ii) entered into for the
purpose of assuring in any other manner the obligee of such Debt or other
obligation of the payment thereof or to protect such obligee against loss in
respect thereof (in whole or in part), provided that the term Guarantee shall
not include: (i) endorsements for collection or deposit in the ordinary course
of business; and (ii) in the case of Corp., Debt of others guaranteed by Corp.
in the ordinary course of its business. The term “Guarantee” used as a verb has
a corresponding meaning.

 

“Insured Debt” shall mean any debt of Parent or its Subsidiaries that is
guaranteed by Corp., provided that the proceeds of such debt are used to
purchase securities, instruments, notes or other obligations issued or owed by
any Person that is not an Affiliate of Parent, in the ordinary course of
business.

 

“Interest Period” shall mean (a) with respect to any Eurodollar Loan, the
interest period applicable thereto, as determined pursuant to Section 1.10 and
(b) with respect to any Competitive Bid Loan, the period beginning on the date
of incurrence thereof and ending on the stated maturity date thereof.

 

“Interest Rate Basis” shall mean LIBOR and/or such other basis for determining
an interest rate as the Borrowers and the Administrative Agent may agree upon
from time to time.

 

“Japanese Yen” shall mean freely transferable lawful money of Japan.

 

“Japanese Yen Equivalent” shall mean, at any time for the determination thereof,
the amount of Japanese Yen which could be purchased with the amount of Dollars
involved in such computation at the spot exchange rate therefor as quoted by
Barclays as of 11:00 A.M. (London time) on the date two Business Days prior to
the date of any determination thereof for purchase on such date.

 

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“Japanese Yen LIBOR” shall mean, for each Interest Period applicable to any Loan
denominated in Japanese Yen, the rate per annum that appears on page 3750 (or
other appropriate page if such currency does not appear on such page) of the Dow
Jones Telerate Screen (or any successor page) for Japanese Yen deposits with
maturities comparable to such Interest Period as of 11:00 A.M. (London time) on
the date which is two Business Days prior to the commencement of such Interest
Period or, if such a rate does not appear on page 3750 (or such other
appropriate page) of the Dow Jones Telerate Screen (or any successor page), the
offered quotations to first-class banks in the London interbank market by
Barclays for Japanese Yen deposits of amounts in same day funds comparable to
the outstanding principal amount of such Loan with maturities comparable to such
Interest Period determined as of 11:00 A.M. (London time) on the date which is
two Business Days prior to the commencement of such Interest Period.

 

“Judgment Currency” shall have the meaning provided in Section 11.16(a).

 

“Judgment Currency Conversion Date” shall have the meaning provided in Section
11.16(a).

 

“Lender” or “Lenders” shall have the meaning provided in the first paragraph of
this Agreement.

 

“Lender Default” shall mean (i) the refusal (which has not been retracted) of a
Lender to make available its portion of any incurrence of Revolving Loans or
(ii) a Lender having notified the Administrative Agent and/or any Borrower that
it does not intend to comply with its obligations under Section 1.01, in the
case of either clause (i) or (ii) as a result of the appointment of a receiver
or conservator with respect to such Lender at the direction or request of any
regulatory agency or authority.

 

“Lender Register” shall have the meaning provided in Section 11.15.

 

“LIBOR” shall mean (i) with respect to any Borrowing of Loans of an Approved
Currency, the relevant interest rate, i.e., U.S. LIBOR, Euro LIBOR, Sterling
LIBOR, Japanese Yen LIBOR or Swiss Franc LIBOR, and (ii) with respect to any
Borrowing of Competitive Bid Loans of an Other Alternate Currency, such rate per
annum as may be agreed upon by the respective Borrower and the respective Bidder
Lender.

 

“Lien” shall mean, with respect to any asset, any mortgage, deed to secure debt,
deed of trust, lien, pledge, charge, security interest, security title,
preferential arrangement which has the practical effect of constituting a
security interest or encumbrance, servitude or encumbrance of any kind in
respect of such asset to secure or assure payment of a Debt or a Guarantee,
whether by consensual agreement or by operation of statute or other law, or by
any agreement, contingent or otherwise, to provide any of the foregoing. For the
purposes of this Agreement, Parent or any Subsidiary shall be deemed to own
subject to a Lien any asset which they have acquired or hold subject to the
interest of a vendor or lessor under any conditional sale agreement, capital
lease or other title retention agreement relating to such asset.

 

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“Loan” shall mean each Revolving Loan and each Competitive Bid Loan.

 

“Margin Stock” shall have the meaning provided in Regulation U.

 

“Material Adverse Effect” shall mean, with respect to any event, act, condition
or occurrence of whatever nature (including any adverse determination in any
litigation, arbitration, or governmental investigation or proceeding), whether
singly or in conjunction with any other event or events, act or acts, condition
or conditions, occurrence or occurrences, whether or not related, a material
adverse change in, or a material adverse effect upon, any of (a) the rights and
remedies of the Administrative Agent or the Lenders under the Credit Documents,
or the ability of each Borrower to perform its obligations under the Credit
Documents to which it is a party, as applicable, or (b) the legality, validity
or enforceability of any Credit Document.

 

“Material Subsidiary” shall mean any Subsidiary with a Net Worth greater than
$5,000,000.

 

“MBIA Asset Management” shall mean MBIA Asset Management, LLC, a limited
liability company organized under the laws of Delaware.

 

“Minimum Borrowing Amount” shall mean (i) for any Revolving Loans that are
Dollar denominated, $2,500,000, (ii) for any Revolving Loans that are Alternate
Currency Loans, an amount in the respective Approved Currency having a Dollar
Equivalent (determined at the time a Notice of Borrowing is received or a
prepayment made) of $2,500,000, (iii) for any Competitive Bid Loans that are
Dollar denominated, $1,000,000 and (iv) for any Competitive Bid Loans that are
Alternate Currency Loans, an amount in the respective Alternate Currency having
a Dollar Equivalent (determined at the time a Notice of Competitive Bid
Borrowing is received or a prepayment made) of $1,000,000.

 

“Multiemployer Plan” shall mean a plan within the meaning of Section 4001(a)(3)
of ERISA.

 

“Net Worth” shall mean, as to any Person, the sum of its capital stock, capital
in excess of par or stated value of shares of its capital stock, retained
earnings and any other account which, in accordance with GAAP, constitutes
stockholders equity, excluding any treasury stock.

 

“Non-Continuing Lender” shall have the meaning specified in Section 1.15.

 

“Non-Defaulting Lender” shall mean each Lender other than a Defaulting Lender.

 

“Note” shall mean each Revolving Note and each Competitive Bid Note.

 

“Notice of Borrowing” shall have the meaning provided in Section 1.03(a).

 

“Notice of Competitive Bid Borrowing” shall have the meaning provided in Section
1.04(a).

 

“Notice of Conversion” shall have the meaning provided in Section 1.07.

 

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“Notice Office” shall mean the office of the Administrative Agent at 222
Broadway, New York, New York 10038 or such other office as the Administrative
Agent may designate to the Borrowers from time to time.

 

“Obligation Currency” shall have the meaning provided in Section 11.16(a).

 

“Obligations” shall mean all amounts, direct or indirect, contingent or
absolute, of every type or description, and at any time existing, owing to any
Agent or any Lender pursuant to the terms of this Agreement or any other Credit
Document.

 

“Other Alternate Currency” shall mean any freely transferable currency other
than any Approved Currency.

 

“Original Effective Date” shall mean August 28, 1998.

 

“Parent” shall have the meaning provided in the first paragraph of this
Agreement.

 

“Payment Office” shall mean the office of the Administrative Agent at 222
Broadway, New York, New York 10038 or such other office as the Administrative
Agent may designate to the Borrowers from time to time.

 

“PBGC” shall mean the Pension Benefit Guaranty Corporation established pursuant
to Section 4002 of ERISA, or any successor thereto.

 

“Person” shall mean any individual, partnership, limited liability company,
joint venture, firm, corporation, association, trust or other enterprise or
business entity or any government or political subdivision or any agency,
department or instrumentality thereof.

 

“Plan” shall mean at any time an employee pension benefit plan which is covered
by Title IV of ERISA or subject to the minimum funding standards under Section
412 of the Code and is either (i) maintained by a member of the Controlled Group
for employees of any member of the Controlled Group or (ii) maintained pursuant
to a collective bargaining agreement or any other arrangement under which more
than one employer makes contributions and to which a member of the Controlled
Group is then making or accruing an obligation to make contributions or has
within the preceding 5 plan years made contributions.

 

“Pounds Sterling” shall mean freely transferable lawful money of the United
Kingdom.

 

“Primary Alternate Currency” shall mean each of Japanese Yen, Pounds Sterling,
Swiss Francs and Euros.

 

“Prime Lending Rate” shall mean the rate which Barclays announces from time to
time as its prime lending rate, the Prime Lending Rate to change when and as
such prime lending rate changes. The Prime Lending Rate is a reference rate and
does not necessarily represent the lowest or best rate actually charged to any
customer. Barclays may make commercial loans or other loans at rates of interest
at, above or below the Prime Lending Rate.

 

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“Principal Amount” shall mean (i) the stated principal amount of each Loan
denominated in Dollars, and/or (ii) the Dollar Equivalent of the stated
principal amount of each Alternate Currency Loan, as the context may require.

 

“Recommitment Deadline” shall have the meaning specified in Section 1.15.

 

“Redeemable Preferred Stock” of any Person shall mean any preferred stock issued
by such Person which is at any time prior to the Final Maturity Date either (i)
mandatorily redeemable (by sinking fund or similar payments or otherwise) or
(ii) redeemable at the option of the holder thereof.

 

“Regulation U” shall mean Regulation U of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor to all or a
portion thereof establishing margin requirements.

 

“Regulation X” shall mean Regulation X of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor to all or a
portion thereof establishing margin requirements.

 

“Relevant Currency Equivalent” shall mean the Dollar Equivalent, the Euro
Equivalent, the Sterling Equivalent, the Japanese Yen Equivalent or the Swiss
Franc Equivalent or the comparable equivalent of any Other Alternate Currency,
as the case may be.

 

“Replaced Lender” shall have the meaning provided in Section 1.14.

 

“Replacement Lender” shall have the meaning provided in Section 1.14.

 

“Required Lenders” shall mean at any time Non-Defaulting Lenders having at least
a majority of the aggregate Commitments of all Non-Defaulting Lenders; provided
that if the Total Commitment has been terminated, then the Required Lenders
shall mean Lenders whose outstanding Loans equal or exceed a majority of the
aggregate outstanding Loans at such time.

 

“Revolving Loan” shall have the meaning specified in Section 1.01(a).

 

“Revolving Note” shall have the meaning provided in Section 1.06(a).

 

“Second Restatement Effective Date” shall have the meaning provided in Section
4.01.

 

“Section 3.04 Certificate” shall have the meaning provided in Section
3.04(b)(ii).

 

“Spread” shall mean a percentage per annum in excess of, or less than, an
Interest Rate Basis.

 

“Spread Borrowing” shall mean a Competitive Bid Borrowing with respect to which
a Borrower has requested the Bidder Lenders to make Competitive Bid Loans at a
Spread over or under a specified Interest Rate Basis.

 

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“Statutory Accounting Principles” shall mean statutory accounting principles
prescribed by the National Association of Insurance Commissioners that are to be
used in making the calculations for purposes of determining compliance with the
terms of this Agreement.

 

“Sterling Equivalent” shall mean, at any time for the determination thereof, the
amount of Pounds Sterling which could be purchased with the amount of Dollars
involved in such computation at the spot exchange rate therefor as quoted by
Barclays as of 11:00 A.M. (London time) on the date two Business Days prior to
the date of any determination thereof for purchase on such date.

 

“Sterling LIBOR” shall mean, with respect to each Interest Period for any Loan
denominated in Pounds Sterling, (I) the rate per annum that appears on page 3750
(or other appropriate page if such currency does not appear on such page) of the
Dow Jones Telerate Screen (or any successive page) with maturities comparable to
such Interest Period as of 11:00 A.M. (London time) on the date which is the
commencement date of such Interest Period or, if such a rate does not appear on
page 3750 (or such other appropriate page) of the Dow Jones Telerate Screen (or
any successor page) the offered quotations to first-class banks in the London
interbank Eurodollar market by Barclays for Pounds Sterling deposits of amounts
in same day funds comparable to the outstanding principal amount of such Loans
with maturities comparable to such Interest Period determined as of 11:00 A.M.
(London time) on the date which is the commencement of such Interest Period plus
(II) the Associated Cost Rate for such Loans for such Interest Period.

 

“Subsidiary” of any Person shall mean and include (i) any corporation more than
50% of whose stock of any class or classes having by the terms thereof ordinary
voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time stock of any class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such Person directly or
indirectly through Subsidiaries and (ii) any partnership, association, joint
venture or other entity in which such Person directly or indirectly through
Subsidiaries, has more than a 50% equity interest at the time. Unless otherwise
expressly provided, all references herein to “Subsidiary” shall mean a
Subsidiary of Parent.

 

“Swiss Franc Equivalent” shall mean, at any time for the determination thereof,
the amount of Swiss Francs which could be purchased with the amount of Dollars
involved in such computation at the spot exchange rate therefor as quoted by
Barclays as of 11:00 A.M. (London time) on the date two Business Days prior to
the date of any determination thereof for purchase on such date.

 

“Swiss Franc LIBOR” shall mean, for each Interest Period applicable to any Loan
denominated in Swiss Francs, the rate per annum that appears on page 3750 (or
other appropriate page if such currency does not appear on such page) of the Dow
Jones Telerate Screen (or any successor page) for Swiss Franc deposits with
maturities comparable to such Interest Period as of 11:00 A.M. (London time) on
the date which is two Business Days prior to the commencement of such Interest
Period or, if such a rate does not appear on page 3750 (or such other
appropriate page) of the Dow Jones Telerate Screen (or any successor page), the
offered quotations to first-class

 

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banks in the London interbank market by Barclays for Swiss Franc deposits of
amounts in same day funds comparable to the outstanding principal amount of such
Loan with maturities comparable to such Interest Period determined as of 11:00
A.M. (London time) on the date which is two Business Days prior to the
commencement of such Interest Period.

 

“Swiss Francs” shall mean freely transferable lawful money of Switzerland.

 

“Syndication Agent” shall have the meaning provided in the first paragraph of
this Agreement.

 

“Taxes” shall have the meaning provided in Section 3.04(a).

 

“Total Commitment” shall mean, at any time, the sum of the Commitments of each
of the Lenders at such time.

 

“Total Unutilized Commitment” shall mean, at any time, (i) the Total Commitment
at such time less (ii) the sum of the aggregate Principal Amount of all
outstanding Loans at such time.

 

“Type” shall mean any type of Loan determined with respect to currency and the
interest option applicable thereto.

 

“UCC” shall mean the Uniform Commercial Code.

 

“US LIBOR” shall mean for each Interest Period applicable to a Loan denominated
in Dollars (other than a Base Rate Loan), the rate per annum that appears on
page 3750 of the Dow Jones Telerate Screen (or any successor page) for Dollar
deposits with maturities comparable to such Interest Period as of 11:00 A.M.
(London time) on the date which is two Business Days prior to the commencement
of such Interest Period or, if such a rate does not appear on page 3750 of the
Dow Jones Telerate Screen (or any successor page), the offered quotations to
first-class banks in the London interbank market by Barclays for Dollar deposits
of amounts in same day funds comparable to the outstanding principal amount of
such Dollar denominated Loan with maturities comparable to such Interest Period
determined as of 11:00 A.M. (London time) on the date which is two Business Days
prior to the commencement of such Interest Period.

 

“Wholly-Owned Subsidiary” of any Person shall mean any other Person to the
extent all of the capital stock or other ownership interests in such other
Person, other than directors’ qualifying shares, is owned directly or indirectly
by such first Person.

 

“Written” or “in writing” shall mean any form of written communication or a
communication by means of facsimile transmission, telegraph or cable.

 

SECTION 10. Agents, etc.

 

10.01 Appointment. The Lenders hereby designate Barclays as Administrative
Agent, KeyBank National Association as Syndication Agent and The Bank of New
York as Documentation Agent to act as specified herein and in the other Credit
Documents. Each Lender

 

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hereby irrevocably authorizes, and each holder of any Note by the acceptance of
such Note shall be deemed irrevocably to authorize, each Agent to take such
action on its behalf under the provisions of this Agreement, the other Credit
Documents and any other instruments and agreements referred to herein or therein
and to exercise such powers and to perform such duties hereunder and thereunder
as are specifically delegated to or required of such Agent by the terms hereof
and thereof and such other powers as are reasonably incidental thereto. The
Agents may perform any of their duties hereunder by or through their respective
officers, directors, agents, employees or affiliates.

 

10.02 Nature of Duties. No Agent shall have any duties or responsibilities
except those expressly set forth in this Agreement and the other Credit
Documents. No Agent or any of its respective officers, directors, agents,
employees or affiliates shall be liable for any action taken or omitted by them
hereunder or under any other Credit Document or in connection herewith or
therewith, unless caused by their gross negligence or willful misconduct. The
duties of each Agent shall be mechanical and administrative in nature; no Agent
shall have by reason of this Agreement or any other Credit Document a fiduciary
relationship in respect of any Lender or the holder of any Note; and nothing in
this Agreement or any other Credit Document, expressed or implied, is intended
to or shall be so construed as to impose upon either Agent any obligations in
respect of this Agreement or any other Credit Document except as expressly set
forth herein or therein with respect to such Agent.

 

10.03 Lack of Reliance on the Agents. Independently and without reliance upon
any Agent, each Lender and the holder of each Note, to the extent it deems
appropriate, has made and shall continue to make (i) its own independent
investigation of the financial condition and affairs of the Borrowers and their
Subsidiaries in connection with the making and the continuance of the Loans and
the taking or not taking of any action in connection herewith and (ii) its own
appraisal of the creditworthiness of the Borrowers and their Subsidiaries and,
except as expressly provided in this Agreement, no Agent shall have any duty or
responsibility, either initially or on a continuing basis, to provide any Lender
or the holder of any Note with any credit or other information with respect
thereto, whether coming into its possession before the making of the Loans or at
any time or times thereafter. No Agent shall be responsible to any Lender or the
holder of any Note for any recitals, statements, information, representations or
warranties herein or in any document, certificate or other writing delivered in
connection herewith or for the execution, effectiveness, genuineness, validity,
enforceability, perfection, collectibility, priority or sufficiency of this
Agreement or any other Credit Document or the financial condition of the
Borrowers and their Subsidiaries or be required to make any inquiry concerning
either the performance or observance of any of the terms, provisions or
conditions of this Agreement or any other Credit Document, or the financial
condition of the Borrowers and their Subsidiaries or the existence or possible
existence of any Default or Event of Default.

 

10.04 Certain Rights of the Agents. If any Agent shall request instructions from
the Required Lenders with respect to any act or action (including failure to
act) in connection with this Agreement or any other Credit Document, such Agent
shall be entitled to refrain from such act or taking such action unless and
until such Agent shall have received instructions from the Required Lenders; and
no Agent shall incur liability to any Person by reason of so refraining. Without
limiting the foregoing, neither any Lender nor the holder of any Note shall have
any right of action whatsoever against an Agent as a result of such Agent acting
or refraining from acting hereunder or under any other Credit Document in
accordance with the instructions of the Required Lenders.

 

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10.05 Reliance. Each Agent shall be entitled to rely, and shall be fully
protected in relying, upon any note, writing, resolution, notice, statement,
certificate, telex, teletype, facsimile or telecopier message, cablegram,
radiogram, order or other document or telephone message signed, sent or made by
any Person that such Agent believed to be the proper Person, and, with respect
to all legal matters pertaining to this Agreement and any other Credit Document
and its duties hereunder and thereunder, upon advice of counsel selected by such
Agent.

 

10.06 Indemnification. To the extent an Agent is not reimbursed and indemnified
by the Borrowers, the Lenders will reimburse and indemnify such Agent, in
proportion to their respective “percentages” as used in determining the Required
Lenders, for and against any and all liabilities, obligations, losses, damages,
penalties, claims, actions, judgments, costs, expenses or disbursements of
whatsoever kind or nature which may be imposed on, asserted against or incurred
by such Agent in performing its respective duties hereunder or under any other
Credit Document, in any way relating to or arising out of this Agreement or any
other Credit Document provided that no Lender shall be liable for any portion of
such liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from the gross negligence or
willful misconduct of such Agent.

 

10.07 The Agents in Their Individual Capacities. With respect to its obligation
to make Loans under this Agreement, each Agent shall have the rights and powers
specified herein for a “Lender” and may exercise the same rights and powers as
though it were not performing the duties specified herein; and the term
“Lenders,” “Required Lenders,” “holders of Notes” or any similar terms shall,
unless the context clearly otherwise indicates, include the Agents in their
individual capacities. Each Agent may accept deposits from, lend money to, and
generally engage in any kind of banking, trust or other business with any
Borrower or any Affiliate of any Borrower as if they were not performing the
duties specified herein, and may accept fees and other consideration from any
Borrower for services in connection with this Agreement and otherwise without
having to account for the same to the Lenders.

 

10.08 Holders. The Administrative Agent may deem and treat the payee of any Note
as the owner thereof for all purposes hereof unless and until a written notice
of the assignment, transfer or endorsement thereof, as the case may be, shall
have been filed with the Administrative Agent. Any request, authority or consent
of any Person who, at the time of making such request or giving such authority
or consent, is the holder of any Note shall be conclusive and binding on any
subsequent holder, transferee, assignee or indorsee, as the case may be, of such
Note or of any Note or Notes issued in exchange therefor.

 

10.09 Resignation by an Agent. (a) The Administrative Agent may resign from the
performance of all its functions and duties hereunder and/or under the other
Credit Documents at any time by giving 15 Business Days’ prior written notice to
the Borrowers and the Lenders. Such resignation shall take effect upon the
appointment of a successor Administrative Agent pursuant to clauses (b) and (c)
below or as otherwise provided below. Upon the effectiveness of such
resignation, the resigning Administrative Agent shall return to Parent and/or
Corp. a pro-rated portion of any administrative fee that has been paid in
advance for the period following the effectiveness of its resignation.

 

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(b) Upon any such notice of resignation, the Required Lenders shall appoint a
successor Administrative Agent hereunder who shall be a Lender, commercial bank
or trust company reasonably acceptable to Parent and Corp.

 

(c) If a successor Administrative Agent shall not have been so appointed within
such 15 Business Day period, the Administrative Agent, with the consent of
Parent and Corp., shall then appoint a successor Administrative Agent who shall
serve as Administrative Agent hereunder until such time, if any, as the Required
Lenders appoint a successor Administrative Agent as provided above.

 

(d) The Syndication Agent and the Documentation Agent may resign from the
performance of all of its functions and duties hereunder and/or under the other
Credit Documents in such capacity at any time by giving five Business Days’
prior written notice to the Lenders. Such resignation shall take effect at the
end of such five Business Days.

 

10.10 Syndication Agent; Documentation Agent. Nothing in this Agreement shall
impose on the Syndication Agent or the Documentation Agent, in each of their
respective capacities as such, any duties or obligations.

 

SECTION 11. Miscellaneous.

 

11.01 Payment of Expenses, etc. The Borrowers jointly and severally agree to:
(i) pay all reasonable out-of-pocket costs and expenses (1) of the
Administrative Agent in connection with the negotiation, syndication,
preparation, execution and delivery of the Credit Documents and the documents
and instruments referred to therein and any amendment, waiver or consent
relating thereto (including, without limitation, the reasonable fees and
disbursements of White & Case LLP) and (2) of the Agents and each of the Lenders
in connection with the enforcement of the Credit Documents and the documents and
instruments referred to therein (including, without limitation, the reasonable
fees and disbursements of counsel for each Agent and for each of the Lenders);
(ii) pay and hold each of the Agents and Lenders harmless from and against any
and all present and future stamp, VAT and other similar taxes with respect to
the foregoing matters and/or fees and save each of the Lenders harmless from and
against any and all liabilities with respect to or resulting from any delay or
omission (other than to the extent attributable to such Lender) to pay such
taxes; and (iii) indemnify each Lender (including in its capacity as an Agent),
its officers, directors, employees, representatives and agents from and hold
each of them harmless against any and all losses, liabilities, claims, damages
or expenses incurred by any of them as a result of, or arising out of, or in any
way related to, or by reason of, an investigation, litigation or other
proceeding (whether or not an Agent or any Lender is a party thereto and whether
or not any such investigation, litigation or other proceeding is between or
among an Agent, any Lender, or any third Person or otherwise) related to the
entering into and/or performance of any Credit Document or the use of the
proceeds of any Loans hereunder or the consummation of any transactions
contemplated in any Credit Document, and in each case, including, without
limitation, the reasonable fees and disbursements of counsel incurred in
connection with any such investigation, litigation or other proceeding (but
excluding any such losses, liabilities, claims, damages or expenses to the
extent incurred by reason of the gross negligence or willful misconduct of the
Person to be indemnified).

 

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11.02 Lender Enforceability Opinions. Within 45 days following the Second
Restatement Effective Date, each Lender (other then Existing Lenders) upon the
request by Parent or Corp., agrees to deliver to Parent and Corp. an opinion or
opinions (as applicable) of counsel to such Lender (which opinion or opinions
may be from internal counsel to such Lender) substantially in the form of
Exhibit J or in such other form as is reasonably acceptable to Parent and Corp.
relating to the enforceability of such Lender’s obligations under the Credit
Documents. Upon a Lender first becoming a party hereunder after the Second
Restatement Effective Date pursuant to Section 1.14, 1.16 or 11.04, such Lender
agrees to deliver to Parent and Corp. unless such opinion has been waived by
Parent and Corp. an opinion or opinions (as applicable) of counsel to such
Lender (which opinion or opinions may be from internal counsel to such Lender)
substantially in the form of Exhibit J or in such other form as is reasonably
acceptable to Parent and Corp. relating to the enforceability of such Lender’s
obligations under the Credit Documents. Notwithstanding the foregoing, the
failure by a Lender to provide the opinion or opinions referred to in this
Section 11.02 shall not affect any of the obligations of the Borrowers hereunder
or under the other Credit Documents.

 

11.03 Notices. Except as otherwise expressly provided herein, all notices and
other communications provided for hereunder shall be in writing (including
telecopier or facsimile) and mailed, telecopied, faxed or delivered, if to a
Borrower, at the address specified opposite its signature below or in the other
relevant Credit Documents, as the case may be; if to any Lender or the
Administrative Agent, at its address specified for such Lender or the
Administrative Agent on Annex II hereto; or, at such other address as shall be
designated by any party in a written notice to the other parties hereto. All
such notices and communications shall be mailed, telecopied or sent by overnight
courier, and shall be effective when received.

 

11.04 Benefit of Agreement. (a) This Agreement shall be binding upon and inure
to the benefit of and be enforceable by the respective successors and assigns of
the parties hereto, provided that no Borrower may assign or transfer any of its
rights or obligations hereunder without the prior written consent of the
Lenders. Each Lender may at any time grant participations in any of its rights
hereunder or under any of the Notes to any Person, provided that (x) in the case
of any such participation, the participant shall not have any rights under this
Agreement or any of the other Credit Documents (the participant’s rights against
such Lender in respect of such participation to be those set forth in the
agreement executed by such Lender in favor of the participant relating thereto)
and all amounts payable by the Borrowers hereunder shall be determined as if
such Lender had not sold such participation, except that the participant shall
be entitled to the benefits of Sections 1.11 and 3.04 of this Agreement to the
extent that such Lender would be entitled to such benefits if the participation
had not been entered into or sold and (y) no Lender shall transfer, grant or
assign any participation under which the participant shall have rights to
approve any amendment to or waiver of this Agreement or any other Credit
Document except to the extent such amendment or waiver would extend the final
scheduled maturity of any Loan or Note in which such participant is
participating, or reduce the rate or extend the time of payment of interest or
Fees thereon (except in connection with a waiver of the applicability of any
post-default increase in interest rates), or reduce the principal amount
thereof, or increase such participant’s participating interest in any Commitment
over the

 

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amount thereof then in effect (it being understood that a waiver of any Default
or Event of Default or of a mandatory reduction in the Total Commitment, or a
mandatory prepayment, shall not constitute a change in the terms of any
Commitment).

 

(b) Notwithstanding the foregoing, (x) any Lender may assign all or a portion of
its Commitment and its rights and obligations hereunder to another Lender (or an
Affiliate of such assigning Lender), and (y) with the consent of the
Administrative Agent and, so long as no Default under Section 8.01(a) or 8.01(h)
or Event of Default exists, Parent (which consent shall not be unreasonably
withheld), any Lender may assign all or a portion of its Commitment and its
rights and obligations hereunder to one or more Persons. No assignment pursuant
to the immediately preceding sentence by a Lender (or by Lenders which are
Affiliates of each other) shall to the extent such assignment represents an
assignment to an institution other than one or more Lenders hereunder (or to an
Affiliate of an assigning Lender), be in an aggregate amount less than
$10,000,000 unless the entire Commitment of the assigning Lender (or group of
Lenders which are Affiliates) is so assigned. If any Lender so sells or assigns
all or a part of its rights hereunder or under the Notes, any reference in this
Agreement or the Notes to such assigning Lender shall thereafter refer to such
Lender and to the respective assignee to the extent of their respective
interests and the respective assignee shall have, to the extent of such
assignment (unless otherwise provided therein), the same rights and benefits as
it would if it were such assigning Lender. Each assignment pursuant to this
Section 11.04(b) shall be effected by the assigning Lender and the assignee
Lender executing an Assignment Agreement (appropriately completed). At the time
of any such assignment, (i) either the assigning or the assignee Lender shall
pay to the Administrative Agent a nonrefundable assignment fee of $3,500, (ii)
Annex I shall be deemed to be amended to reflect the Commitment of the
respective assignee (which shall result in a direct reduction to the Commitment
of the assigning Lender) and of the other Lenders, and (iii) the Borrowers at
such time will issue new Notes to the respective assignee and to the assigning
Lender in conformity with the requirements of Section 1.06. To the extent any
assignment pursuant to this Section 11.04(b) is to a Person which is not already
a Lender hereunder and which is not a United States Person (as such term is
defined in Section 7701(a)(30) of the Code) for Federal income tax purposes, the
respective assignee Lender shall provide to Parent and the Administrative Agent
the appropriate Internal Revenue Service Forms (and, if applicable, a Section
3.04 Certificate) described in Section 3.04(b). To the extent that an assignment
of all or any portion of a Lender’s Commitments and related outstanding
obligations pursuant to this Section 11.04(b) would, at the time of such
assignment, result in increased costs under Section 1.11 or 3.04 from those
being charged by the respective assigning bank prior to such assignment, then
the Borrowers shall not be obligated to pay such increased costs (although the
Borrowers shall be obligated to pay any other increased costs of the type
described above resulting from changes specified in said Section 1.11 or 3.04
occurring after the date of the respective assignment). Each Lender and the
Borrowers agree to execute such documents (including without limitation
amendments to this Agreement and the other Credit Documents) as shall be
necessary to effect the foregoing. Nothing in this clause (b) shall prevent or
prohibit any Lender from pledging its Notes or Loans to a Federal Reserve Bank
in support of borrowings made by such Lender from such Federal Reserve Bank.

 

(c) Notwithstanding any other provisions of this Section 11.04, no transfer or
assignment of the interests or obligations of any Lender hereunder or any grant
of participation therein shall be permitted if such transfer, assignment or
grant would require any Borrower to file a registration statement with the
Securities and Exchange Commission or to qualify the Loans under the “Blue Sky”
laws of any State.

 

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11.05 No Waiver; Remedies Cumulative. No failure or delay on the part of any
Agent or any Lender in exercising any right, power or privilege hereunder or
under any other Credit Document shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, power or privilege hereunder or under
any other Credit Document preclude any other or further exercise thereof or the
exercise of any other right, power or privilege hereunder or thereunder. The
rights and remedies herein expressly provided are cumulative and not exclusive
of any rights or remedies which any Agent or any Lender would otherwise have.

 

11.06 Payments Pro Rata. (a) The Administrative Agent agrees that promptly after
its receipt of each payment from or on behalf of any Borrower in respect of any
Obligations of such Borrower hereunder, it shall distribute such payment to the
Lenders (other than any Lender that has expressly waived its right to receive
its pro rata share thereof) pro rata based upon their respective shares, if any,
of the Obligations with respect to which such payment was received.

 

(b) Each of the Lenders agrees that, if it should receive any amount hereunder
(whether by voluntary payment, by realization upon security, by the exercise of
the right of setoff or banker’s lien, by counterclaim or cross action, by the
enforcement of any right under the Credit Documents, or otherwise) which is
applicable to the payment of the principal of, or interest on, the Loans or
Fees, of a sum which with respect to the related sum or sums received by other
Lenders is in a greater proportion than the total of such Obligation then owed
and due to such Lender bears to the total of such Obligation then owed and due
to all of the Lenders immediately prior to such receipt, then such Lender
receiving such excess payment shall purchase for cash without recourse or
warranty from the other Lenders an interest in the Obligations of the respective
Borrower to such Lenders in such amount as shall result in a proportional
participation by all of the Lenders in such amount, provided that if all or any
portion of such excess amount is thereafter recovered from such Lender, such
purchase shall be rescinded and the purchase price restored to the extent of
such recovery, but without interest.

 

(c) Notwithstanding anything to the contrary contained herein, the provisions of
the preceding Sections 11.06(a) and (b) shall be subject to the express
provisions of this Agreement which require, or permit, differing payments to be
made to Non-Defaulting Lenders as opposed to Defaulting Lenders.

 

11.07 Calculations; Computations. (a) The financial statements to be furnished
to the Lenders pursuant hereto shall be made and prepared in conformity with
GAAP or Statutory Accounting Principles, as the case may be, consistently
applied throughout the periods involved (except as set forth in the notes
thereto or as otherwise disclosed in writing by the Borrowers to the Lenders and
with respect to any interim financial statements, subject to changes resulting
from audit and normal year-end audit adjustments), provided that (x) except as
otherwise specifically provided herein, all computations determining compliance
with Sections 7.07 and 7.08, including definitions used therein, shall utilize
accounting principles and policies in effect at the time of the preparation of,
and in conformity with those used to prepare, the December 31, 2002 financial
statements delivered to the Lenders pursuant to Section 5.04(a) and

 

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(y) if at any time the computations determining compliance with Sections 7.07
and 7.08 utilize accounting principles different from those utilized in the
financial statements furnished to the Lenders, such financial statements shall
be accompanied by reconciliation work-sheets.

 

(b) All computations of interest and Fees hereunder shall be made on the actual
number of days elapsed over a year of 360 days (365-366 days for interest on
Base Rate Loans when the Base Rate is based on the Prime Lending Rate).

 

(c) For purposes of this Agreement, the Dollar Equivalent of each Loan that is
an Alternate Currency Loan shall be calculated on the date when any such Loan is
made, on the second Business Day of each month and at such other times as
designated by the Administrative Agent at any time when a Default or an Event of
Default exists. Such Dollar Equivalent shall remain in effect until the same is
recalculated by the Administrative Agent as provided above and notice of such
recalculation is received by the Borrowers, it being understood that until such
notice is received, the Dollar Equivalent shall be that Dollar Equivalent as
last reported to the Borrowers by the Administrative Agent. The Administrative
Agent shall promptly notify the Borrowers and the Lenders of each such
determination of the Dollar Equivalent.

 

11.08 Governing Law; Submission to Jurisdiction; Venue; Waiver of Jury Trial.
(a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH
AND BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK. Any legal action or
proceeding with respect to this Agreement or any other Credit Document may be
brought in the courts of the State of New York or of the United States for the
Southern District of New York, and, by execution and delivery of this Agreement,
each Borrower hereby irrevocably accepts for itself and in respect of its
property, generally and unconditionally, the jurisdiction of the aforesaid
courts. Each Borrower further irrevocably consents to the service of process out
of any of the aforementioned courts in any such action or proceeding by the
mailing of copies thereof by registered or certified mail, postage prepaid, to
it, to the extent located outside New York City, or by hand, to the extent
located within New York City, at its address for notices pursuant to Section
11.03, such service to become effective 30 days after such mailing. Nothing
herein shall affect the right of any Agent or any Lender to serve process in any
manner permitted by law or to commence legal proceedings or otherwise proceed
against any Borrower in any other jurisdiction.

 

(b) Each Borrower each hereby irrevocably waives any objection which it may now
or hereafter have to the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this Agreement or any other
Credit Document brought in the courts referred to in clause (a) above and hereby
further irrevocably waives and agrees not to plead or claim in any such court
that any such action or proceeding brought in any such court has been brought in
an inconvenient forum.

 

(c) Each of the parties to this Agreement hereby irrevocably waives all right to
a trial by jury in any action, proceeding or counterclaim arising out of or
relating to this Agreement, the other Credit Documents or the transactions
contemplated hereby or thereby.

 

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11.09 Counterparts. This Agreement may be executed in any number of counterparts
and by the different parties hereto on separate counterparts, each of which when
so executed and delivered shall be an original, but all of which shall together
constitute one and the same instrument. A set of counterparts executed by all
the parties hereto shall be lodged with Parent, Corp. and the Administrative
Agent.

 

11.10 Headings Descriptive. The headings of the several sections and subsections
of this Agreement are inserted for convenience only and shall not in any way
affect the meaning or construction of any provision of this Agreement.

 

11.11 Amendment or Waiver. Neither this Agreement nor any other Credit Document
nor any terms hereof or thereof may be changed, waived, discharged or terminated
unless such change, waiver, discharge or termination is in writing signed by the
Borrowers and the Required Lenders, provided that no such change, waiver,
discharge or termination shall, without the consent of each Lender (other than a
Defaulting Lender) directly affected thereby, (i) extend the Final Maturity Date
or reduce the rate or extend the time of payment of interest (other than as a
result of waiving the applicability of any post-default increase in interest
rates) or Fees or other amounts payable hereunder, or reduce the principal
amount thereof, or increase the Commitment of any Lender over the amount thereof
then in effect (it being understood that a waiver of any Default or Event of
Default or of a mandatory reduction in the Total Commitment shall not constitute
a change in the terms of any Commitment of any Lender), (ii) amend, modify or
waive any provision of this Section 11.11 or of Section 4.02(d), (iii) reduce
the percentage specified in, or (except to give effect to any additional
facilities hereunder) otherwise modify, the definition of Required Lenders, or
(iv) consent to the assignment or transfer by any Borrower of any of its rights
and obligations under this Agreement.

 

11.12 Survival. All indemnities set forth herein including, without limitation,
in Section 1.11, 1.12 or 3.04 shall survive the execution and delivery of this
Agreement and the making and repayment of the Loans.

 

11.13 Domicile of Loans. Each Lender may transfer and carry its Loans at, to or
for the account of any branch office, Subsidiary or affiliate of such Lender,
provided that the Borrowers shall not be responsible for costs arising under
Section 1.11 or 3.04 resulting from any such transfer (other than a transfer
pursuant to Section 1.13 or 1.14) to the extent not otherwise applicable to such
Lender prior to such transfer.

 

11.14 Confidentiality. Subject to Section 11.04, the Lenders shall hold all
non-public information obtained pursuant to the requirements of this Agreement
in accordance with its customary procedure for handling confidential information
of this nature and in accordance with safe and sound banking practices and in
any event may make disclosure to its Affiliates, employees, auditors, advisors
or counsel or as reasonably required by any bona fide transferee or participant
in connection with the contemplated transfer of any Loans or participation
therein (so long as such transferee or participant agrees to be bound by the
provisions of this Section 11.14) or as required or requested by any
governmental agency or representative thereof or pursuant to legal process,
provided that, unless specifically prohibited by applicable law or court order,
each Lender shall notify Parent of any request by any governmental agency or
representative thereof (other than any such request in connection with an
examination of the financial condition

 

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of such Lender by such governmental agency) for disclosure of any such
non-public information prior to disclosure of such information, and provided
further that in no event shall any Lender be obligated or required to return any
materials furnished by Parent or any of its Subsidiaries.

 

11.15 Lender Register. Each Borrower hereby designates the Administrative Agent
to serve as its agent, solely for purposes of this Section 11.15, to maintain a
register (the “Lender Register”) on which it will record the Commitments from
time to time of each of the Lenders, the Loans made by each of the Lenders and
each repayment in respect of the principal amount of the Loans of each Lender.
Failure to make any such recordation, or any error in such recordation, shall
not affect the Borrowers’ obligations in respect of such Loans. With respect to
any Lender, the transfer of the Commitments of such Lender and the rights to the
principal of, and interest on, any Loan made pursuant to such Commitments shall
not be effective until such transfer is recorded on the Lender Register
maintained by the Administrative Agent with respect to ownership of such
Commitments and Loans and prior to such recordation all amounts owing to the
transferor with respect to such Commitments and Loans shall remain owing to the
transferor. The registration of assignment or transfer of all or part of any
Commitments and Loans shall be recorded by the Administrative Agent on the
Lender Register only upon the acceptance by the Administrative Agent of a
properly executed and delivered Assignment Agreement pursuant to Section
11.04(b). The Borrowers jointly and severally agree to indemnify the
Administrative Agent from and against any and all losses, claims, damages and
liabilities of whatsoever nature which may be imposed on, asserted against or
incurred by the Administrative Agent in performing its duties under this Section
11.15 other than those resulting from the Administrative Agent’s willful
misconduct or gross negligence.

 

11.16 Judgment Currency. (a) The Borrowers’ obligations hereunder and under the
other Credit Documents to make payments in the applicable Approved Currency or
Other Alternate Currency (the “Obligation Currency”) shall not be discharged or
satisfied by any tender or recovery pursuant to any judgment expressed in or
converted into any currency other than the Obligation Currency, except to the
extent that such tender or recovery results in the effective receipt by the
Administrative Agent or the respective Lender of the full amount of the
Obligation Currency expressed to be payable to the Administrative Agent or such
Lender under this Agreement or the other Credit Documents. If, for the purpose
of obtaining or enforcing judgment against any Borrowers in any court or in any
jurisdiction, it becomes necessary to convert into or from any currency other
than the Obligation Currency (such other currency being hereinafter referred to
as the “Judgment Currency”) an amount due in the Obligation Currency, the
conversion shall be made at the Relevant Currency Equivalent, and, in the case
of other currencies, the rate of exchange (as quoted by the Administrative Agent
or if the Administrative Agent does not quote a rate of exchange on such
currency, by a known dealer in such currency designated by the Administrative
Agent) determined, in each case, as of the Business Day immediately preceding
the day on which the judgment is given (such Business Day being hereinafter
referred to as the “Judgment Currency Conversion Date”).

 

(b) If there is a change in the rate of exchange prevailing between the Judgment
Currency Conversion Date and the date of actual payment of the amount due, the
Borrowers covenant and agree to pay, or cause to be paid, such additional
amounts, if any (but in any event not a lesser amount) as may be necessary to
ensure that the amount paid in the

 

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Judgment Currency, when converted at the rate of exchange prevailing on the date
of payment, will produce the amount of the Obligation Currency which could have
been purchased with the amount of Judgment Currency stipulated in the judgment
or judicial award at the rate of exchange prevailing on the Judgment Currency
Conversion Date.

 

(c) For purposes of determining the Relevant Currency Equivalent or any other
rate of exchange for this Section, such amounts shall include any premium and
costs payable in connection with the purchase of the Obligation Currency.

 

11.17 Euro. (a) If at any time that an Alternate Currency Loan is outstanding,
the relevant Alternate Currency is fully replaced as the lawful currency of the
country that issued such Alternate Currency (the “Issuing Country”) by the Euro
so that all payments are to be made in the Issuing Country in Euros and not in
the Alternate Currency previously the lawful currency of such country, then such
Alternate Currency Loan shall be automatically converted into a Loan denominated
in Euros in a principal amount equal to the amount of Euros into which the
principal amount of such Alternate Currency Loan would be converted pursuant to
the EMU Legislation and thereafter no further Loans will be available in such
Alternate Currency, with the basis of accrual of interest, notices requirements
and payment offices with respect to such converted Loans to be that consistent
with the convention and practices in the London interbank market for Euro
denominated Loans.

 

(b) The applicable Borrowers shall from time to time, at the request of any
Lender, pay to such Lender the amount of any losses, damages, liabilities,
claims, reduction in yield, additional expense, increased cost, reduction in any
amount payable, reduction in the effective return of its capital, the decrease
or delay in the payment of interest or any other return forgone by such Lender
or its affiliates as a result of the tax or currency exchange resulting from the
introduction, changeover to or operation of the Euro in any applicable nation or
eurocurrency market.

 

* * *

 

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IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of this
Agreement to be duly executed and delivered as of the date first above written.

 

MBIA Inc.

 

MBIA INC.,

113 King Street

 

    as a Borrower

Armonk, NY 10504

           

Tel: (914) 765-3327

           

Fax: (914) 765-3410

           

Attention: Joseph Sevely

               

By:

 

        /s/ Joseph Sevely

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with a copy to:

     

Name:

 

Joseph Sevely

       

Title:

 

Treasurer

113 King Street

           

Armonk, NY 10504

           

Tel: (914) 765-3213

           

Fax: (914) 765-3410

           

Attention: Karen M. Wagner

           

MBIA Insurance Corporation

 

MBIA INSURANCE CORPORATION,

113 King Street

 

    as a Borrower

Armonk, New York 10504

           

Tel: (914) 765-3327

           

Fax: (914) 765-3410

           

Attention: Joseph Sevely

               

By:

 

        /s/ Joseph Sevely

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

with a copy to:

     

Name:

 

Joseph Sevely

       

Title:

 

Treasurer

113 King Street

           

Armonk, NY 10504

           

Tel: (914) 765-3213

           

Fax: (914) 765-3410

           

Attention: Karen M. Wagner

           

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

   

BARCLAYS BANK PLC,

   

    Individually and as Administrative Agent

   

By:

 

        /s/ Alison A. McGuigan

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

       

Name:

 

Alison A. McGuigan

       

Title:

 

Associate Director

   

KEYBANK NATIONAL ASSOCIATION,

   

    Individually and as Syndication Agent

   

By:

 

        /s/ Mary K. Young

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

       

Name:

 

Mary K. Young

       

Title:

 

Vice President

   

THE BANK OF NEW YORK,

   

    Individually and as Documentation Agent

   

By:

 

        /s/ David Trick

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

       

Name:

 

David Trick

       

Title:

 

Vice President

   

JPMORGAN CHASE BANK

   

By:

 

        /s/ Marybeth Mullen

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

       

Name:

 

Marybeth Mullen

       

Title:

 

Vice President

   

FLEET NATIONAL BANK

   

By:

 

        /s/ George J. Urban

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

       

Name:

 

George J. Urban

       

Title:

 

Portfolio Manager

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

   

NATIONAL AUSTRALIA BANK LIMITED

   

By:

 

        /s/ Michael G. McHugh

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

       

Name:

 

Michael G. McHugh

       

Title:

 

Senior Vice President

   

WELLS FARGO BANK, NATIONAL

ASSOCIATION

   

By:

 

        /s/ Robert C. Meyer

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

       

Name:

 

Robert C. Meyer

       

Title:

 

Vice President

   

By:

 

        /s/ Beth McGinnis

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

       

Name:

 

Beth McGinnis

       

Title:

 

Vice President

   

BANK OF AMERICA, N.A.

   

By:

 

        /s/ Joan D’Amico

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

       

Name:

 

Joan D’Amico

       

Title:

 

Managing Director

   

DEUTSCHE BANK AG NEW YORK BRANCH

   

By:

 

        /s/ Ruth Leung

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

       

Name:

 

Ruth Leung

       

Title:

 

Director

   

By:

 

        /s/ Clinton Johnson

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

       

Name:

 

Clinton Johnson

       

Title:

 

Managing Director

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

   

BANK ONE, N.A.

   

By:

 

        /s/ Gretchen Roetzer

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

       

Name:

 

Gretchen Roetzer

       

Title:

 

Director

   

COOPERATIEVE CENTRALE RAIFFEISEN-

BOERENLEENBANK B.A.,”RABOBANK

INTERNATIONAL”, NEW YORK BRANCH

   

By:

 

        /s/ Raymond K. Miller

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

       

Name:

 

Raymond K. Miller

       

Title:

 

Managing Director

   

By:

 

        /s/ Angela R. Reilly

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

       

Name:

 

Angela R. Reilly

       

Title:

 

Executive Director

   

NORDDEUTSCHE LANDESBANK

GIROZENTRALE NEW YORK BRANCH AND/OR

CAYMAN ISLANDS BRANCH

   

By:

 

        /s/ Georg L. Peters

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

       

Name:

 

Georg L. Peters

       

Title:

 

Vice President

   

By:

 

        /s/ Jan de Jonge

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

       

Name:

 

Jan de Jonge

       

Title:

 

Vice President

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

   

CAJA MADRID

   

By:

 

        /s/ Paul Barrabés

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

       

Name:

 

Paul Barrabés

       

Title:

 

Head of Industrialised Markets

   

By:

 

        /s/ Enrique Tierno Pérez-Relaño

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

       

Name:

 

Enrique Tierno Pérez-Relaño

       

Title:

 

Head of International Financial Institutions

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

ANNEX 1

 

COMMITMENTS

 

Lender

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

   Commitment

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

Barclays Bank plc

   $ 34,000,000

KeyBank National Association

   $ 33,300,000

The Bank of New York

   $ 29,300,000

JPMorgan Chase Bank

   $ 21,700,000

Fleet National Bank

   $ 16,700,000

National Australia Bank Limited

   $ 16,700,000

Wells Fargo Bank, National Association

   $ 16,700,000

Bank of America, N.A.

   $ 15,000,000

Deutsche Bank AG New York Branch and/or Cayman Islands Branch

   $ 10,000,000

Bank One, N.A.

   $ 8,300,000

Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A., “Rabobank International”,
New York Branch

   $ 8,300,000

Norddeutsche Landesbank Girozentrale New York Branch and/or Cayman Islands
Branch

   $ 8,300,000

Caja Madrid

   $ 6,700,000

Total

   $ 225,000,000     

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

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

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

ANNEX II

 

LENDER ADDRESSES

 

Barclays Bank plc

  

200 Park Avenue

New York, NY 10166

Attn:     Alison Mcguigan

Tel:        (212) 412-7672

Fax:        (212) 412-5610

e-mail: alison.mcguigan@barcap.com

KeyBank National Association

  

127 Public Square, 6th Floor

Cleveland, OH 44114

Attn:     Mary K. Young

Tel:        (216) 689-4443

Fax:        (216) 689-4981

e-mail: mary_k_young@keybank.com

The Bank of New York

  

One Wall Street

New York, NY 10286

Attn:     David Trick

Tel:        (212) 635-1064

Fax:        (212) 809-9520

e-mail: dtrick@bankofny.com

JPMorgan Chase

  

270 Park Avenue

New York, NY 10017

Attn:     Marybeth Mullen

Tel:        (212) 270-5049

Fax:        (212) 270-0670

e-mail: marybeth.mullen@chase.com

Fleet National Bank

  

777 Main Street

Hartford, CT 06115

Attn:     George Urban

Tel:        (860) 952-7565

Fax:        (860) 986-1264

e-mail: george_j_urban@fleet.com

National Australia Bank Limited,
New York Branch ACN 004044937

  

200 Park Avenue, Floor 34

New York, NY 10166

Attn:     Mike McHugh

Tel:        (212) 916-9559

Fax:        (212) 983-1969

e-mail: mmchugh@nabny.com

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

Annex II

Page 2

 

Wells Fargo Bank, National Association

  

230 W. Monroe Street, Suite 2900

Chicago, IL 60606

Attn:     Robert Meyer

Tel:        (312) 345-8623

Fax:        (312) 845-6606

e-mail: meyerrc@wellsfargo.com

Bank of America, N.A.

  

901 Main Street, 66th Floor

Dallas, TX 75201

Attn:     Joan D’Amico

Tel:        (214) 209-3307

Fax:        (214) 209-3742

e-mail: joan.damico@bankofamerica.com

 

with a copy to:

 

901 Main Street, 66th Floor

Dallas, TX 75201

Attn:     Jim Miller

Tel:        (214) 209-0559

Fax:        (214) 209-3742

e-mail: jim.v.miller@bankofamerica.com

Deutsche Bank AG New York Branch

  

31 West 52nd Street, 23rd Floor

New York, NY 10019

Attn:     Ruth Leung

Tel:        (212) 469-8650

Fax:    (212) 469-8366

e-mail: ruth.leung@db.com

Bank One, N.A.

  

153 West 51st Street

New York, NY 10019

Attn:     Mark Goldstein

Tel:        (212) 373-1169

Fax:        (212) 373-1439

e-mail: mark_goldstein@bankone.com

 

with a copy to:

 

1 Bank One Plaza, Suite IL1-0085

Chicago, IL 60670

Attn:     Gretchen K. Roetzer

Tel:        (312) 732-8068

Fax:        (312) 732-4033

e-mail: gretchen_k_roetzer@bankone.com

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

Annex II

Page 3

 

Rabobank International

  

245 Park Avenue

New York, NY 10167

Attn:     Angela Reilly

Tel:        (212) 916-7919

Fax:        (212) 808-2579

e-mail: a.r.reilly@nyc.rabobank.com

Norddeutsche Landesbank Girozentrale
New York Branch and/or Cayman Islands Branch

  

1114 Avenue of the Americas

New York, NY 10036

Attn:     Georg Peters

Tel:        (212) 812-6993

Fax:        (212) 812-6860

e-mail: georg.peters@nordlb.com

Caja Madrid

  

Torre Caja Madrid

P.o de la Castellana, 189

28046 Madrid, Spain

Attn:     Beatrice Alvarez Orejas

Tel:        34-91-423-95-66

Fax:        34-91-423-95-93

e-mail: balvareo@cajamadrid.es

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

ANNEX III

 

SUBSIDIARIES OF MBIA INC.

 

NAME OF SUBSIDIARY

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

  

JURISDICTION OF INCORPORATION

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

MBIA Insurance Corporation

   New York

Municipal Issuers Service Corporation

   New York

MBIA Insurance Corp. of Illinois

   Illinois

MBIA Asset Management, LLC

   Delaware

MBIA Municipal Investors Service Corporation

   Delaware

Colorado Investor Services Corporation

   Colorado

MBIA Investment Management Corp.

   Delaware

MBIA Capital Management Corp.

   Delaware

1838 Investment Advisors, LLC

   Delaware

1838 Delaware Holding, LLC

   Delaware

MBIA Capital Corp.

   Delaware

Muni Resources, LLC

   Delaware

MBIA International Marketing Services, Pty. Limited

   Australia

MBIA Assurance S.A.

   France

MBIA Singapore Pte Ltd.

   Singapore

MBIA Japan Limited

   Japan

MBIA UK Limited

   England and Wales

MBIA Global Funding, LLC

   Delaware

MBIA Asset Finance, LLC

   Delaware

Assurance Funding Limited

   Jersey

MBIA Services Company

   Delaware

MBIA MuniServices Company

   Delaware

Municipal Tax Collection Bureau, Inc.

   Pennsylvania

John T. Austin, Inc.

   California

Allen W. Charkow, Inc.

   California

Municipal Resource Consultants

   California

Capital Asset Holdings, Ltd.

   Florida

CapMAC Holdings Inc.

   Delaware

Capital Markets Assurance Corporation

   New York

CapMAC Investment Management, Inc.

   Delaware

CapMAC Financial Services, Inc.

   Delaware

CapMAC Financial Services (Europe) Ltd.

   England and Wales

CapMAC Asia Ltd.

   Bermuda

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

ANNEX IV

 

CALCULATION OF ASSOCIATED COST RATE FOR

REVOLVING LOANS AND COMPETITIVE BID LOANS

 

The Associated Cost Rate for any Revolving Loan or Competitive Bid Loan
denominated in Pounds Sterling or Euros will be the rate determined by the
Administrative Agent (rounded upward, if necessary, to four decimal places) in
accordance with the following formula (expressed as a percentage per annum):

 

CL + S(L - Z) + 0.01F

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

100 - (C+S)

 

Where on the day of application of the formula:

 

  C The amount required to be held as a non-interest bearing cash ratio deposit
with the Bank of England expressed as a percentage of the Administrative Agent’s
Eligible Liabilities (above any stated minimum).

 

  F The amount of Pounds Sterling per £1,000,000 or Euros per €1,000,000, as the
case may be, of the fee base of the Administrative Agent payable to the
Financial Services Authority per annum (disregarding any minimum fee payable
under the Fees Regulations).

 

  L The rate of interest per annum at which Euros or Pounds Sterling deposits,
as the case may be, of an amount comparable to the applicable Loan or other
amount are offered by the Administrative Agent to leading banks in the London
interbank market at or about 11:00 A.M. (London time) on the date of calculation
for a period comparable to the period for which the Associated Cost Rate is to
be calculated; or

 

Euro LIBOR or Sterling LIBOR, as the case may be, for the relevant day is the
rate of interest (without taking into account the Applicable Margin or the
Associated Cost Rate) payable on that day on the related Revolving Loan or
Competitive Bid Loan, as the case may be, denominated in Euros or Pounds
Sterling pursuant to Section 1.09 of this Agreement.

 

  S The amount required to be placed as Special Deposits with the Bank of
England, expressed as a percentage of the Administrative Agent’s Eligible
Liabilities (above any stated minimum).

 

  Z The lower of L and the rate of interest per annum paid by the Bank of
England on Special Deposits at or about 11:00 A.M. (London time) on the date of
calculation.

 

For the purposes of calculating the Associated Cost Rate:

 

  (i) C, L, S and Z are included in the formula as numbers and not as
percentages, e.g. if C = 0.15 percent and L = 7 percent, CL is calculated at
0.15 x 7;

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

Annex IV

Page 2

 

  (ii) the formula is applied on the first day of each period for which it falls
to be calculated (and the result shall apply for the duration of such period);

 

  (iii) each amount is rounded up to the nearest four decimal places; and

 

  (iv) if the formula produces a negative percentage, the percentage shall be
taken as zero.

 

If alternative or additional financial requirements are imposed by the Bank of
England, the Financial Services Authority or any other fiscal, monetary or
governmental authority or agency (including the European Central Bank) which in
the Administrative Agent’s reasonable opinion make the above formula (or any
element thereof, or any defined term used therein) no longer appropriate, the
Administrative Agent (following consultation with each applicable Borrower and
the Required Lenders) shall be entitled by notice to the Borrower to stipulate
such other formula as shall be suitable to apply in substitution for the above
formulae. Any such variation shall, in the absence of manifest error, be
conclusive and binding on all parties and shall apply from the date specified in
such notice.

 

For the purposes of this Schedule:

 

“Bank of England Act” means the Bank of England Act 1998;

 

“Eligible Liabilities” has the meaning given to that term in the Cash Ratio
Deposits (Eligible Liabilities) Order 1998 or the applicable substitute order
made under the Bank of England Act as in force on the date of application of the
formula;

 

“Fee Base” has the meaning given to that term in the Fees Regulations;

 

“Fees Regulations” means the Banking Supervision (Fees) Regulations 2001 or the
applicable substitute regulations made under the Bank of England Act as are in
force on the date of application of the formula; and

 

“Special Deposits” has the meaning given to that term by the Bank of England on
the date of application of the formula.

 

Any reference to a provision of any statute, directive, order or regulation
herein is a reference to that provision as amended or re-enacted from time to
time.