Exhibit 10.1

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$1,000,000,000

REVOLVING CREDIT AND COMPETITIVE
ADVANCE FACILITY AGREEMENT

     dated as of

January 13, 2006

among

AVON PRODUCTS, INC.

AVON CAPITAL CORPORATION

THE ADDITIONAL BORROWERS, BANKS AND OTHER LENDERS
FROM TIME TO TIME PARTIES HERETO

     and

CITIBANK, N.A.,

as Administrative Agent

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     Bank of America, N.A.
and
JPMorgan Chase Bank, N.A.,
as Syndication Agents

The Bank of Tokyo-Mitsubishi UFJ Trust Company,
Deutsche Bank AG New York Branch
and
HSBC Bank USA, National Association
as Documentation Agents

     Citigroup Global Markets Inc.
Banc of America Securities LLC
and
J.P. Morgan Securities Inc.,
as Joint Lead Arrangers and Joint Bookrunners

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TABLE OF CONTENTS       Page       ARTICLE 1 DEFINITIONS       Section 1.01.
Certain Definitions 1       ARTICLE 2 THE LOANS         Section 2.01. The
Revolving Credit Loans; Commitments 14 Section 2.02. Procedure for Revolving
Credit Loans 14 Section 2.03. Evidence for Loans 15 Section 2.04. Increase of
Commitment 16 Section 2.05. Reduction of Commitments 17 Section 2.06. Prepayment
of Revolving Credit Loans 17 Section 2.07. Competitive Advance Loans 17 Section
2.08. Purpose of Loans 20 Section 2.09. Extension of Termination Date 20  
ARTICLE 3 INTEREST, CONVERSION, FEES, ETC.         Section 3.01. Procedure for
Interest Rate Determination 22 Section 3.02. Interest on ABR Loans 22 Section
3.03. Interest on Revolving Eurodollar Loans and Competitive Eurodollar Loans 23
Section 3.04. Interest on Competitive Absolute Rate Loans 23 Section 3.05.
Continuation and Conversion of Revolving Credit Loans 23 Section 3.06.
Post-Maturity Interest 24 Section 3.07. Maximum Interest Rate 24 Section 3.08.
Fees 24   ARTICLE 4 DISBURSEMENT AND PAYMENT         Section 4.01. Disbursement
of Loans; Pro Rata Treatment of Banks 26 Section 4.02. Method of Payment 26
Section 4.03. Compensation for Losses 27 Section 4.04. Withholding, Reserves and
Additional Costs 28 Section 4.05. Unavailability and Impracticability 31 Section
4.06. Substitution of Banks 32 Section 4.07. Repayment of Loans 32

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ARTICLE 5 REPRESENTATIONS AND WARRANTIES       Section 5.01. Representations and
Warranties of the Borrowers 32   ARTICLE 6 CONDITIONS PRECEDENT         Section
6.01. Conditions to Effectiveness 35 Section 6.02. Conditions to Each Loan 37
Section 6.03. Satisfaction of Conditions Precedent 38 Section 6.04. Additional
Borrowers 38   ARTICLE 7 COVENANTS         Section 7.01. Affirmative Covenants
39 Section 7.02. Negative Covenants 42   ARTICLE 8 EVENTS OF DEFAULT        
Section 8.01. Events of Default 44 Section 8.02. Notice of Default 45   ARTICLE
9 THE ADMINISTRATIVE AGENT AND THE BANKS         Section 9.01. The Agency 46
Section 9.02. The Administrative Agent’s Duties 46 Section 9.03. Sharing of
Payments and Expenses 46 Section 9.04. The Administrative Agent’s Liabilities 47
Section 9.05. The Administrative Agent as a Bank 47 Section 9.06. Bank Credit
Decision 47 Section 9.07. Indemnification 47 Section 9.08. Successor
Administrative Agent 48   ARTICLE 10 THE GUARANTY         Section 10.01. The
Guaranty 48 Section 10.02. Absolute Guaranty 49 Section 10.03. Consents, Waivers
and Renewals 49 Section 10.04. Subrogation 49 Section 10.05. Security 50 Section
10.06. Continuing Guaranty 50

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Section 10.07. Waiver of Notice 50   ARTICLE 11 MISCELLANEOUS   Section 11.01.
Applicable Law 50 Section 11.02. Set-off 50 Section 11.03. Expenses 50 Section
11.04. Amendments 51 Section 11.05. Cumulative Rights and No Waiver 51 Section
11.06. Notices 51 Section 11.07. Severability 53 Section 11.08. Parties in
Interest 53 Section 11.09. Waiver of Right to Jury 55 Section 11.10. Indemnity
55 Section 11.11. Consent to Jurisdiction 56 Section 11.12. Confidentiality 56
Section 11.13. Judgment 56 Section 11.14. Execution in Counterparts 57 Section
11.15. Patriot Act 57

SCHEDULES         Schedule 2.01   – Banks and Commitments Schedule 5.01(e)   –
Certain Litigation Schedule 6.04   – Certain Additional Borrowers     EXHIBITS  
        Exhibit A   – Form of Revolving Credit Loan Request Exhibit B-1   – Form
of Revolving Credit Note Exhibit B-2   – Form of Competitive Advance Note
Exhibit C-1   – Competitive Advance Facility Procedures Exhibit C-2   – Form of
Competitive Advance Loan Request Exhibit C-3   – Form of Competitive Advance
Notice Letter Exhibit C-4   – Form of Competitive Advance Bid Exhibit C-5   –
Form of Competitive Advance Bid Accept/Reject Letter Exhibit D   – Form of
Continuation/Conversion Request Exhibit E-1   – Form of Additional Borrower
Designation Exhibit E-2   – Form of Additional Borrower Confirmation Exhibit F  
– Form of Assignment and Acceptance Exhibit G   – Form of Opinion of General
Counsel of API

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     REVOLVING CREDIT AND COMPETITIVE ADVANCE FACILITY AGREEMENT, dated as of
January 13, 2006 (as further amended, supplemented, modified or extended from
time to time, this “ Agreement”), among Avon Products, Inc., a New York
corporation (“API”), Avon Capital Corporation, a Delaware corporation (“ACC”),
each of the Additional Borrowers (as defined below) from time to time designated
as such, each of the banks and other lenders from time to time parties hereto
(each, a “Bank” and, collectively, the “Banks”) and the Administrative Agent (as
defined below).

W I T N E S S E T H:

     WHEREAS, API and ACC have requested that, subject to certain conditions,
the Administrative Agent and the Banks enter into this Agreement;

     WHEREAS, the Administrative Agent and the Banks are willing to enter into
this Agreement on the terms and subject to the conditions hereof;

     NOW, THEREFORE, the parties hereby agree as follows:

ARTICLE 1

DEFINITIONS

     Section 1.01. Certain Definitions.

     (a) Terms Generally. The definitions ascribed to terms in this Section 1.01
and elsewhere in this Agreement shall apply equally to both the singular and
plural forms of the terms defined. The words “include”, “includes” and
“including” shall be deemed to be followed by the phrase “without limitation”.
The words “hereby”, “herein”, “hereof”, “hereunder” and words of similar import
refer to this Agreement as a whole (including any exhibits and schedules hereto)
and not merely to the specific section, paragraph or clause in which such word
appears. All references herein to Articles, Sections, Exhibits and Schedules
shall be deemed references to Articles and Sections of, and Exhibits and
Schedules to, this Agreement unless the context shall otherwise require.

     (b) Accounting Terms. Except as otherwise expressly provided herein, all
terms of an accounting or financial nature shall be construed in accordance with
GAAP as in effect from time to time; provided, however, that, for purposes of
determining compliance with the covenants set forth in Sections 7.02(b) and
7.02(d), such terms shall be construed in accordance with GAAP as in effect on
the date of this Agreement applied on a basis consistent with the construction
thereof applied in preparing API’s audited financial statements referred to in
Section 5.01(d) . In the event there shall occur a change in GAAP which but for
the foregoing proviso would affect the computation used to determine compliance
with either such covenant, the Borrowers and the Banks agree to negotiate in
good faith in an effort to agree upon an amendment to this Agreement that will
permit compliance with such covenant to be determined by reference to GAAP as so
changed while affording the Banks the protection afforded by such covenant prior
to such change (it being

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understood, however, that such covenant shall remain in full force and effect in
accordance with its existing terms pending the execution by the Borrowers and
the Banks of any such amendment).

     (c) Certain Other Terms. The following terms shall have the meanings
ascribed to them below or in the Sections of this Agreement indicated below:

     “ABR Lending Office” shall mean, with respect to each Bank, its office
identified in its Administrative Questionnaire as its domestic lending office or
such other office as such Bank may hereafter designate as its domestic lending
office or ABR lending office by notice to the Borrowers and the Administrative
Agent.

     “ABR Loans” shall mean, collectively, Revolving Credit Loans, or portions
thereof, that bear interest by reference to the Base Rate and in the manner set
forth in Section 3.02.

     “ACC” shall have the meaning ascribed to such term in the Preamble to this
Agreement.

     “Additional Amounts” shall have the meaning ascribed to such term in
Section 4.04(a) .

     “Additional Borrower” shall mean, as of any date, a Subsidiary of API that
has on or before such date been designated by API as an Additional Borrower in
accordance with the terms of this Agreement.

     “Additional Costs” shall have the meaning ascribed to such term in Section
4.04(b) .

     “Administrative Agent” shall mean Citibank, N.A., together with its
affiliates, as the administrative agent for the Banks under this Agreement and
the Credit Documents.

     “Administrative Questionnaire” shall mean, with respect to each Bank, an
administrative details reply form in the form prepared by the Administrative
Agent and submitted to the Administrative Agent duly completed by such Bank.

     “Agreement” shall have the meaning ascribed to such term in the Preamble to
this Agreement.

     “API” shall have the meaning ascribed to such term in the Preamble to this
Agreement.

     “Applicable Lending Office” shall mean, with respect to any Bank, (a) in
the case of its ABR Loans, its ABR Lending Office and (b) in the case of
Revolving Eurodollar Loans or Competitive Eurodollar Loans, its Eurodollar
Lending Office.

     “Assignee” shall have the meaning ascribed to such term in Section 11.08(c)
.

     “Assuming Bank” shall have the meaning ascribed to such term in Section
2.09(c) .

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     “Assignment and Acceptance” shall have the meaning ascribed to such term in
Section 11.08(c) .

     “Augmenting Bank” shall have the meaning ascribed to such term in Section
2.04.

     “Available Facility” shall mean (a) on any date prior to the Final
Termination Date, an amount equal to the remainder of (i) the Total Commitment
on such date minus (ii) the sum of the aggregate outstanding principal amount of
Loans on such date and (b) on and after the Final Termination Date, $0.

     “Bank” shall have the meaning ascribed to such term in the Preamble to this
Agreement. In the circumstances described in Section 11.08(c)(iii), an Assignee
shall also be deemed a “Bank.”

     “Base Rate” shall mean, for any day, a fluctuating interest rate per annum
in effect from time to time, which rate per annum shall be equal to the higher
of:

>      (a) the rate of interest publicly announced by the Administrative Agent
> in New York City from time to time as its prime rate in effect on such day;
> and
> 
>      (b) the sum of (i) ½ of 1% per annum and (ii) the Federal Funds Rate in
> effect on such day.

     “Benefit Arrangement” shall mean, at any time, an employee benefit plan
within the meaning of Section 3(3) of ERISA which is not a Plan or a
Multiemployer Plan and which is maintained or otherwise contributed to by any
member of the ERISA Group.

     “Borrower” shall mean, with respect to any Loan, whichever of the Borrowers
that has borrowed such Loan in accordance with the terms hereof.

     “Borrowers” shall mean, collectively, as of any date, the Initial Borrowers
and the Additional Borrowers as of such date; provided that if ACC shall at any
time cease to be a Wholly-Owned Subsidiary, it shall cease to be an Initial
Borrower or a Borrower at such time. Without in any way limiting API’s
obligations as guarantor under Article 10, all the obligations of the Borrowers
hereunder and in respect of any Loans shall be several and not joint.

     “Borrowing Date” shall mean, with respect to any Loan, the date set forth
in the relevant Borrowing Request as the date upon which such Borrower desires
to borrow such Loan.

     “Borrowing Request” shall mean a Competitive Advance Loan Request or a
Revolving Credit Loan Request.

     “Capital Lease” shall mean, with respect to any Person, any obligation of
such Person to pay rent or other amounts under a lease with respect to any
property (whether real, personal or mixed) acquired or leased by such Person
that is required to be accounted for as a liability on a balance sheet of such
Person in accordance with GAAP.

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     “Change of Control” shall mean, with respect to API, (i) any “person” (as
defined in Section 3(a)(9) of the Exchange Act and as used in Sections 13(d) and
14(d) thereof), excluding API, any Subsidiary and any Plan (including any
trustee of such plan acting as trustee), but including a “group” as defined in
Section 13(d)(3) of the Exchange Act, becomes the beneficial owner of shares of
API having at least 35% of the total number of votes that may be cast for the
election of directors of API, provided that no Event of Default will occur as a
result of an acquisition of stock by API which increases, proportionately, the
stock representing the voting power of API owned by such person or group above
35% of the voting power of API and provided further that if such person or group
acquires stock representing more than 35% of the voting power of API by reason
of share purchases by API, and after such share purchases by API acquires any
additional shares representing voting power of API, then an Event of Default
shall occur; or (ii) within any 24-month period beginning on or after the date
hereof, the persons who were directors of API immediately before the beginning
of such period (the “Incumbent Directors”) shall cease (for any reason other
than death) to constitute at least a majority of the Board of Directors of API
or the board of directors of any successor to API, provided that any director
who was not a director as of the date hereof shall be deemed to be an Incumbent
Director if such director was elected to the Board of Directors by, or on the
recommendation of or with the approval of, at least two-thirds of the directors
who then qualified as Incumbent Directors either actually or by prior operation
of this clause (ii) and provided further that any director elected to the Board
of Directors of API to avoid or settle a threatened or actual proxy contest
shall in no event be deemed to be an Incumbent Director.

     “Code” shall mean the Internal Revenue Code of 1986, as amended.

     “Commitment” shall mean, with respect to any Bank, the amount of such
Bank’s commitment to make Loans reflected in the Register. In the case of Banks
parties hereto on the date hereof, such amount is set forth opposite such Bank’s
name under the heading “Commitment” on Schedule 2.01, as such amount may be
reduced from time to time pursuant to Section 2.05, 4.06 or 11.08 or increased
from time to time pursuant to Section 2.04, 2.09 or 11.08. Each Bank’s
Commitment shall terminate on the Termination Date applicable to such Bank.

     “Competitive Absolute Rate Loans” shall mean, collectively, Competitive
Advance Loans that bear interest at a fixed percentage rate per annum (expressed
in the form of a decimal to no more than four decimal places) specified by the
Bank making such Loan in its Competitive Advance Bid.

     “Competitive Advance Accept/Reject Deadline” shall mean, with respect to
any Competitive Advance Loan, the time specified as the Competitive Advance
Deadline for such Loan in Exhibit C-1.

     “Competitive Advance Accept/Reject Notice” shall have the meaning ascribed
to such term in Section 2.07.

     “Competitive Advance Bid” shall mean an offer by a Bank to make a
Competitive Advance Loan pursuant to Section 2.07.

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     “Competitive Advance Bid Deadline” shall mean, with respect to any
Competitive Advance Loan, the time specified as the Competitive Advance Bid
Deadline for such Loan in Exhibit C-1.

     “Competitive Advance Bid Rate” shall mean, with respect to any Competitive
Advance Bid, (a) in the case of a Competitive Eurodollar Loan, the Competitive
Advance Margin, and (b) in the case of a Competitive Absolute Rate Loan, the
fixed rate of interest at which the Bank making the Competitive Advance Bid
offers thereby to make a Competitive Advance Loan (in either case, for purposes
of Section 2.07(d), determined after giving effect to any waiver, pursuant to
Section 2.07(c), of compensation under Section 3.03(c), 4.04(a) or 4.04(b)) .

     “Competitive Advance Loan Request” shall mean a telephonic request by a
Borrower (confirmed in writing countersigned by a Responsible Officer of API by
not later than 4:00 P.M., New York time, on the date of such telephonic notice)
to borrow Competitive Advance Loans, which shall specify, with respect to such
requested Competitive Advance Loans, (a) the proposed Borrowing Date therefor,
(b) the aggregate amount of Competitive Advance Loans which such Borrower
desires to borrow on such Borrowing Date, (c) the Maturity Date, (d) whether
such Competitive Advance Loans are to bear interest as Competitive Eurodollar
Loans or Competitive Absolute Rate Loans, (e) if such Competitive Advance Loans
are Competitive Eurodollar Loans, the Interest Period therefor, (f) any other
terms to be applicable to such proposed Competitive Advance Loans, and (g)
confirming that such request has been approved by API.

     “Competitive Advance Loans” shall mean, collectively, Loans, or portions
thereof, made pursuant to Section 2.07, in each case denominated in Dollars.

     “Competitive Advance Margin” shall mean, with respect to any Competitive
Eurodollar Loan for any Interest Period, the margin (expressed as a percentage
rate per annum in the form of a decimal to no more than four decimal places) to
be added to or subtracted from LIBOR, in order to determine the interest rate
applicable to such Loan during such Interest Period, as specified in the
Competitive Advance Bid and the Competitive Advance Accept/Reject Notice
relating to such Loan.

     “Competitive Advance Notes” shall mean, collectively, any promissory notes
of the Borrowers evidencing Competitive Advance Loans.

     “Competitive Advance Notice Time” shall mean, with respect to any
Competitive Advance Loan, the time specified as the Competitive Advance Notice
Time for such Loan in Exhibit C-1.

     “Competitive Advance Rate” shall mean, with respect to any Competitive
Absolute Rate Loan, the fixed rate of interest (expressed as a percentage rate
per annum in the form of a decimal to no more than four decimal places) for such
Loan, as specified in the Competitive Advance Bid and Competitive Advance
Accept/Reject Notice relating to such Loan.

     “Competitive Eurodollar Loans” shall mean, collectively, Competitive
Advance Loans that bear interest by reference to LIBOR and a Competitive Advance
Margin, in the manner set forth in Section 3.03.

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     “Consolidated Subsidiary” shall mean, at any date with respect to any
Person, any Subsidiary or other entity the accounts of which would be
consolidated with those of such Person in the consolidated financial statements
of such Person if such statements were prepared in accordance with GAAP as of
such date.

     “Conversion Date” shall mean the date on which a conversion of interest
rates on outstanding Revolving Credit Loans, pursuant to a Conversion Request,
shall take effect.

     “Conversion Request” shall mean a telephonic request (confirmed in writing
not later than 4:00 P.M., New York time, on the date of such telephonic notice)
by a Borrower to convert the interest rate on all or portions of its outstanding
Revolving Credit Loans pursuant to the terms hereof, which shall specify, with
respect to such outstanding Revolving Credit Loans, (i) the requested Conversion
Date, which shall be not less than three Business Days after the date of such
Conversion Request, (ii) the aggregate amount of the Revolving Credit Loans,
from and after the Conversion Date, which are to bear interest as ABR Loans or
Revolving Eurodollar Loans, as the case may be, and (iii) the term of the
Interest Periods therefor, if any.

     “Credit Documents” shall mean, collectively, this Agreement and the Notes.

     “Debt” shall mean, with respect to any Person at any date, without
duplication, (a) all obligations of such Person for borrowed money, (b) all
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments, (c) 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, (d) all obligations of such Person as lessee
under Capital Leases, (e) all contingent or non-contingent obligations of such
Person to reimburse or prepay any bank or other Person in respect of amounts
paid or payable (currently or in the future, on a contingent or non-contingent
basis) under a letter of credit, bankers’ acceptance or similar instrument,
other than (i) contingent obligations relating to letters of credit issued to
support trade payables and (ii) obligations up to $75,000,000 arising under
stand-by letters of credit, (f) all Debt of others secured by a Lien on any
asset of such Person, whether or not such Debt is assumed by such Person and (g)
all Debt of others Guaranteed by such Person; provided, however, that Debt shall
not include any obligations incurred in connection with the funding of a trust
established under Section 501(c)(9) of the Code.

     “Default” shall mean any event or circumstance which, with the giving of
notice or the passage of time, or both, would unless cured or waived become an
Event of Default.

     “Dollars” and the sign “$” shall mean lawful money of the United States of
America.

     “Domestic Business Day” shall mean any day except a Saturday, Sunday or
other day on which commercial banks in New York City are authorized or required
by law to close.

     “Effective Date” shall have the meaning ascribed to such term in Section
6.01.

     “Environmental Laws” shall mean any and all federal, state, local and
foreign statutes, laws, regulations, ordinances, rules, franchises, licenses,
agreements or other governmental restrictions relating to the environment or to
emissions, discharges or releases of

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pollutants, contaminants, petroleum or petroleum products, chemicals or
industrial, toxic or hazardous substances or wastes into the environment
including, without limitation, ambient air, surface water, ground water, or
land, or otherwise relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of pollutants, contaminants,
petroleum or petroleum products, chemicals or industrial, toxic or hazardous
substances or wastes or clean-up or other remediation thereof.

     “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
amended.

     “ERISA Group” shall mean API and all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with API, are treated as a single employer under
Section 414(b), (c), (m) or (o) of the Code.

     “Eurodollar Business Day” shall mean any Domestic Business Day on which
commercial banks are open for international business (including dealings in
Dollar deposits) in London.

     “Eurodollar Lending Office” shall mean, with respect to each Bank, its
office, branch or affiliate identified in its Administrative Questionnaire as
its Eurodollar lending office or such other office, branch or affiliate of such
Bank as it may hereafter designate as its Eurodollar lending office by notice to
the Borrowers and the Administrative Agent.

     “Eurodollar Loans” shall mean, collectively, Competitive Eurodollar Loans
and Revolving Eurodollar Loans.

     “Eurodollar Reserve Percentage” shall mean, for any day, the percentage in
effect on such day, as prescribed by the Board of Governors of the Federal
Reserve System (or any successor) for determining the maximum reserve
requirement (including any marginal, supplemental or emergency reserve
requirements) for a member bank of the Federal Reserve System in New York City
with deposits exceeding one billion dollars in respect of “Eurocurrency
Liabilities” (as defined in Regulation D of the Federal Reserve Board (or any
successor regulation)).

     “Event of Default” shall mean any of the events described in Section 8.01.

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

     “Excluded Taxes” shall mean all present and future taxes imposed on or
measured by the overall net income of any Bank (or any office, branch or
subsidiary of such Bank) or any franchise taxes, taxes on doing business or
taxes measured by capital or net worth imposed on any Bank (or any office,
branch or subsidiary of such Bank), in each case imposed by the United Sates of
America or any political subdivision or taxing authority thereof or therein, or
taxes on or measured by the overall net income of any office, branch or
subsidiary of a Bank or any franchise taxes, taxes imposed on doing business or
taxes measured by capital or net worth imposed on any office, branch or
subsidiary of such Bank, in each case imposed by any foreign country or
subdivision thereof in which such office, branch or subsidiary is doing
business.

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     “Existing Credit Agreement” shall mean the Revolving Credit and Competitive
Advance Facility Agreement dated as of May 1, 2001 among API, ACC, the
additional borrowers and the lenders parties thereto and The Chase Manhattan
Bank, as administrative agent.

     “Extending Bank” means each Bank that agrees to an extension of the
Termination Date in accordance with Section 2.09(a) .

     “Extension Date” has the meaning specified in Section 2.09(b) .

     “Facility Fee” shall have the meaning ascribed to such term in Section
3.08(a) .

     “Federal Funds Rate” shall mean, for any day, the rate per annum (rounded
to the nearest 1/16 of 1% or, if there is no nearest 1/16 of 1%, to the next
higher 1/16 of 1%) equal to the weighted average of the rates on overnight
Federal funds transactions with members of the Federal Reserve System arranged
by Federal funds brokers on such day, as published by the Federal Reserve Bank
of New York on the Domestic Business Day next succeeding such day; provided that
(a) if such day is not a Domestic Business Day, the Federal Funds Rate for such
day shall be such rate on such transactions on the next preceding Domestic
Business Day as so published on the next succeeding Domestic Business Day, and
(b) if no such rate is so published on such next succeeding Domestic Business
Day, the Federal Funds Rate for such day shall be the average rate quoted to the
Administrative Agent on such day on such transactions as determined by the
Administrative Agent.

     “Federal Reserve Board” shall mean the Board of Governors of the Federal
Reserve System or any successor agency.

     “Fee Payment Date” shall mean the last day of each calendar quarter,
commencing with the first such day after the date hereof, and the earlier of (a)
any other date on which the Total Commitment is cancelled in full and (b) as to
any Bank, its Termination Date.

     “Final Termination Date” means the latest date to which the Termination
Date may have been extended pursuant to Section 2.09.

     “GAAP” shall mean generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entities as may be approved by a significant segment of the accounting
profession, which are applicable to the circumstances as of the date of
determination.

     “Governmental Authority” shall mean any nation or government, any state or
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.

     “Guaranteed Obligations” shall have the meaning ascribed to such term in
Section 10.01.

     “Guaranty” by any Person shall mean any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Debt or other
obligation of any other Person

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and, without limiting the generality of the foregoing, any obligation, direct or
indirect, contingent or otherwise, of such Person (a) to 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 agreements
to keep-well, to purchase assets, goods, securities or services, to take-or-pay,
or to maintain financial statement conditions or otherwise) or (b) entered into
for the purpose of assuring in any other manner the obligee of such Debt or
other obligation of the payment thereof (in whole or in part); provided that the
term Guaranty shall not include endorsements for collection or deposit in the
ordinary course of business. The term “Guarantee” used as a verb has a
corresponding meaning.

     “Indemnified Tax” shall have the meaning ascribed to such term in Section
4.04(a) .

     “Initial Borrower” shall mean API or ACC.

     “Initial Loan” shall mean the first Loan which is made pursuant to the
terms hereof.

     “Interest Coverage Ratio” shall mean, as of any date of determination, the
ratio of (a) the consolidated pre-tax income of API and its Consolidated
Subsidiaries before the cumulative effect of accounting changes and before
interest expense (other than (i) hyperinflationary interest expense in any
country that is offset by corresponding foreign exchange-related gains, (ii)
interest expense attributable to pension accruals in Germany and Italy and (iii)
interest payable to the Internal Revenue Service in respect of taxes), to (b)
consolidated interest expense for API and its Consolidated Subsidiaries (other
than the interest expense described in the parenthetical phrase in clause (a)
above), in each case for the period of four fiscal quarters ending on such date.

     “Interest Period” shall mean (a) with respect to each Revolving Eurodollar
Loan, the period commencing on the Borrowing Date or on the last day of the
preceding Interest Period and ending one, two, three or six months thereafter,
as the Borrower may elect in the applicable Borrowing Request or pursuant to
Section 3.03(b), and (b) with respect to each Competitive Eurodollar Loan, the
period commencing on the Borrowing Date and ending on the Maturity Date;
provided that

>      (i) any Interest Period that would otherwise end on a day that is not a
> Eurodollar Business Day shall be extended to the next succeeding Eurodollar
> Business Day unless such Eurodollar Business Day falls in another calendar
> month, in which case such Interest Period shall end on the next preceding
> Eurodollar Business Day,
> 
>      (ii) any Interest Period (other than an Interest Period with respect to a
> Competitive Eurodollar Loan with an Interest Period that is not an integral
> number of months) that begins on the last Eurodollar Business Day of a
> calendar month (or on a day for which there is no numerically corresponding
> day in the calendar month at the end of such Interest Period) shall, subject
> to clause (iii) below, end on the last Eurodollar Business Day of a calendar
> month, and
> 
>      (iii) any Interest Period that begins before the Final Termination Date
> and would otherwise end after the Final Termination Date shall end on the
> Final Termination Date.

9

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     “LIBOR” shall mean, with respect to any Interest Period for a Eurodollar
Loan, the rate per annum determined by the Administrative Agent as the offered
rate for Dollar deposits with a term comparable to such Interest Period that
appears on the Eurodollar Telerate Page (as defined below) at approximately
11:00 A.M., London time, on the second full Eurodollar Business Day preceding
the first day of such Interest Period. However, if such rate does not appear on
the Eurodollar Telerate Page, “LIBOR” shall mean the rate per annum determined
by the Administrative Agent to be the arithmetic mean (rounded to the nearest
1/16 of 1% or, if there is no nearest 1/16 of 1%, to the next higher 1/16 of 1%)
of the respective rates of interest communicated by the Reference Banks to the
Administrative Agent as the rate at which Dollar deposits are offered to the
Reference Banks by leading banks in the London interbank deposit market at
approximately 11:00 A.M., London time, on the second full Eurodollar Business
Day preceding the first day of such Interest Period in an amount substantially
equal to the principal amount of such Eurodollar Loan (rounded up to the nearest
integral multiple of $1,000,000) for a term equal to such Interest Period.
“Eurodollar Telerate Page” shall mean the display designated as Page 3750 on the
service provided by Moneyline Telerate, Inc. (or such other page as may replace
such page on such service, or any successor to the substitute for such service
for the purpose of displaying the rates at which Dollar deposits are offered by
leading banks in the London interbank deposit market).

     “Lien” shall mean, with respect to any asset, (a) any mortgage, deed of
trust, lien, pledge, encumbrance, charge or security interest in or on such
asset, (b) the interest of a vendor or lessor under any conditional sale
agreement, capital lease or title retention agreement relating to such asset,
and (c) in the case of securities, any purchase option, call or similar right of
a third party with respect to such securities.

     “Loans” shall mean, collectively, Revolving Credit Loans and Competitive
Advance Loans.

     “Material Plan” shall mean a Plan or Plans having aggregate Unfunded
Liabilities in excess of $100,000,000.

     “Material Subsidiary” shall mean, as of any date, a Subsidiary having
assets of at least $100,000,000, as reflected in the most recent quarterly or
annual balance sheet of such Subsidiary dated on or prior to such date.

     “Maturity Date” shall mean, with respect to a Competitive Advance Loan, the
date for repayment of such Competitive Advance Loan, which date shall be at
least 10 days and (a) not more than 180 days after the Borrowing Date, in the
case of a Competitive Absolute Rate Loan, or (b) not more than six months after
the Borrowing Date, in the case of a Competitive Eurodollar Loan, and in any
event shall not be later than the Final Termination Date.

     “Moody’s” shall mean Moody’s Investors Service, Inc. and any successor
thereto that is a nationally recognized rating agency.

     “Multiemployer Plan” shall mean an employee pension benefit plan within the
meaning of Section 4001(a)(3) of ERISA to which any member of the ERISA Group is
making or accruing an obligation to make contributions or has within the
preceding five plan years made contributions (including for these purposes any
Person which ceased to be a member of the ERISA

10

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Group during such five year period) and under which liability may be imposed on
any member of the ERISA Group.

     “Notes” shall mean, collectively, Revolving Credit Notes and Competitive
Advance Notes, if any.

     “Non-Consenting Bank” means any Bank that, in response to any request by
API or the Administrative Agent to a departure from, waiver of or amendment to
any provision of any Credit Document that requires the agreement of all Banks,
which departure, waiver or amendment receives the consent of the Required Banks,
shall not have given its consent to such departure, waiver or amendment.

     “Non-Extending Bank” has the meaning specified in Section 2.09(b).

     “Participant” shall have the meaning ascribed to such term in Section
11.08(b).

     “PBGC” shall mean the Pension Benefit Guaranty Corporation or any successor
thereto.

     “Person” shall mean any individual, sole proprietorship, partnership, joint
venture, trust, unincorporated organization, association, corporation,
institution, public benefit corporation, entity or government (whether Federal,
state, county, city, municipal or otherwise, including any instrumentality,
division, agency, body or department thereof).

     “Plan” shall mean an employee pension benefit plan as defined in Section
3(2) of ERISA which is covered by Title IV of ERISA or subject to the minimum
funding standards under Section 412 of the Code and is maintained for employees
of API or any other member of the ERISA Group.

     “Prescribed Forms” shall mean such duly executed form(s) or statement(s),
and in such number of copies, which may, from time to time, be prescribed by law
and which, pursuant to applicable provisions of (a) an income tax treaty between
the United States and the country of residence of the Bank providing the form(s)
or statement(s), (b) the Code or (c) any applicable rule or regulation under the
Code, permit one or more of the Borrowers to make payments hereunder for the
account of such Bank free of deduction or withholding for income or similar
taxes.

     “Pro Rata Share” shall mean, in the case of each Bank, the proportion of
such Bank’s Commitment to the Total Commitment of all the Banks or, if the Total
Commitment shall have been cancelled or reduced to $0 or expired, the proportion
of the aggregate amount of such Bank’s Revolving Credit Loans then outstanding
to the aggregate amount of Revolving Credit Loans then outstanding.

     “Reference Bank” shall mean each of Citibank, N.A., Bank of America, N.A.
and JPMorgan Chase Bank, N.A.

     “Register” shall have the meaning ascribed to such term in Section 2.03.

11

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     “Required Banks” shall mean, at any date, Banks having at least a majority
of the Total Commitment or, if the Total Commitment has been cancelled or
terminated, holding at least a majority of the aggregate outstanding principal
amount of the Loans.

     “Responsible Officer” shall mean, with respect to a Person, the chief
executive officer, president, chief financial officer, chief accounting officer,
treasurer, deputy treasurer or assistant treasurer, secretary or assistant
secretary or any vice president of such Person.

     “Revolving Credit Loan Request” shall mean a telephonic request (confirmed
in writing by not later than 4:00 P.M., New York time, on the date of such
telephonic request) by a Borrower to borrow Revolving Credit Loans, which shall
specify (a) the requested Borrowing Date, (b) the aggregate amount of Revolving
Credit Loans that such Borrower desires to borrow on such date, (c) whether such
requested Revolving Credit Loans are to bear interest as ABR Loans or Revolving
Eurodollar Loans and (d) if the requested Revolving Credit Loans are to bear
interest as Revolving Eurodollar Loans, the Interest Period therefor.

     “Revolving Credit Loans” shall mean, collectively, ABR Loans and Revolving
Eurodollar Loans, in each case denominated in Dollars.

     “Revolving Credit Notes” shall mean, collectively, the promissory notes of
the Borrowers evidencing Revolving Credit Loans, if any.

     “Revolving Eurodollar Loans” shall mean, collectively, Revolving Credit
Loans, or portions thereof, that bear interest at the rate and in the manner set
forth in Section 3.03.

     “Revolving Eurodollar Margin” shall mean, at any date and with respect to
each Revolving Eurodollar Loan, the applicable margin set forth below based upon
the ratings applicable on such date to API’s senior unsecured long-term debt:

    Revolving Eurodollar Margin  

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

  Level I                          Moody’s: Aa3 or above                      
 S&P: AA- or above 0.125%   Level II                          Moody’s: A1      
                 S&P: A+ 0.140%   Level III                          Moody’s: A2
                       S&P: A 0.185%   Level IV:                        
 Moody’s: A3                        S&P: A- 0.220%   Level V:                  
       Moody’s: Baa1 or lower                        S&P: BBB+ or lower 0.300%  

12

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     For purposes of the foregoing, (a) if no rating for API’s senior unsecured
long-term debt shall be available from either rating agency, such rating agency
shall be deemed to have established a Level V rating, (b) if the ratings
established or deemed established by Moody’s and S&P shall fall within different
Levels, the Revolving Eurodollar Margin shall be based upon the Level
corresponding to the more favorable of such ratings except if the lower of such
ratings is more than one Level below the higher of such ratings, the Revolving
Eurodollar Margin shall be based upon the Level that is one Level below the
higher of such ratings and (c) if any rating established or deemed established
by Moody’s or S&P shall be changed (other than as a result of a change in the
rating system of either Moody’s or S&P), such change shall be given effect on
and as of the opening of business on the date when such change is first
announced by the rating agency making such change. Each such change shall apply
to all Revolving Eurodollar Loans outstanding at any time 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 either Moody’s or S&P shall change prior to the Final Termination
Date, API and the Banks shall negotiate in good faith to amend the references to
specific ratings in this definition to reflect such changed rating system.

     “S&P” shall mean Standard & Poor’s, a division of The McGraw-Hill
Companies, Inc., and any successor thereto that is a nationally recognized
rating agency.

     “SEC” shall mean the Securities and Exchange Commission or any successor
agency.

     “Subsidiary” shall mean any corporation or other entity of which a majority
of the securities or other ownership interests having ordinary voting power to
elect directors or other persons performing similar functions are at the time
directly or indirectly owned by API.

     “Taxes” shall have the meaning ascribed to such term in Section 4.04(a) .

     “Termination Date” shall mean the earlier of (a) the fifth anniversary of
the Effective Date, subject, as to any Bank, to the extension thereof pursuant
to Section 2.09 and (b) the date on which all Loans shall have been fully repaid
and all Commitments entirely cancelled; provided, that the Termination Date as
to any Bank that is a Non-Extending Bank shall be the Termination Date in effect
immediately prior to the applicable Extension Date for all purposes of this
Agreement.

     “Total Commitment” shall mean the aggregate Commitments of all the Banks,
being initially $1,000,000,000 (subject to cancellation, increase or reduction
pursuant to Section 2.04 or 2.05) .

     “Unfunded Liabilities” means, with respect to any Plan, any amount by which
(a) the present value of all benefit liabilities under such Plan exceeds (b) the
fair market value of all Plan assets allocable to such benefits (excluding any
accrued but unpaid contributions), all determined as of the then most recent
valuation date for such Plan, but only to the extent that such excess represents
a potential liability of a member of the ERISA Group to the PBGC or any other
Person under Title IV of ERISA.

     “Utilization Fee” shall have the meaning accorded to such term in Section
3.08(b) .

13

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     “Wholly-Owned Subsidiary” shall mean any Subsidiary all the shares of stock
of all classes of which (other than directors’ qualifying shares) at the time
are owned directly or indirectly by API.

ARTICLE 2

THE LOANS

     Section 2.01. The Revolving Credit Loans; Commitments. (a) Prior to the
Final Termination Date and subject to the terms and conditions of this
Agreement, each of the Banks, severally and not jointly with the other Banks,
agrees to make one or more Revolving Credit Loans denominated in Dollars to the
Borrowers from time to time in an aggregate principal amount at any one time
outstanding not to exceed its Commitment; provided, however, that the amount of
Revolving Credit Loans which may be borrowed on any Borrowing Date may not
exceed the Available Facility (after giving effect to any Loans being repaid or
prepaid on such Borrowing Date and any other Loans to be made on such Borrowing
Date).

     (b) Each Bank’s Commitment, as of the date of this Agreement, is set forth
opposite its name in Schedule 2.01, and, after such date, each Bank’s Commitment
shall be recorded in the Register as provided in Section 2.03.

     Section 2.02. Procedure for Revolving Credit Loans. (a) A Borrower may
borrow Revolving Credit Loans by giving a Revolving Credit Loan Request
telephonically, to the Administrative Agent not later than 10:30 A.M., New York
time (to be confirmed in writing in substantially the form of Exhibit A not
later than 4:00 P.M. on the same day), (i) on the Borrowing Date therefor with
respect to any ABR Loan and (ii) at least three Eurodollar Business Days before
the Borrowing Date with respect to any Revolving Eurodollar Loan. Revolving
Credit Loans shall be in an amount equal to $10,000,000 or an integral multiple
of $1,000,000 in excess thereof (except that such borrowing of ABR Loans may be
in the aggregate amount of the unused portion of the Total Commitment).

     (b) Upon receipt of any Revolving Credit Loan Request from a Borrower, the
Administrative Agent shall forthwith give notice to each Bank of the substance
thereof. Not later than 2:00 P.M., New York time, on the Borrowing Date
specified in such Revolving Credit Loan Request, each Bank shall make available
to the Administrative Agent in immediately available funds at the Applicable
Lending Office of the Administrative Agent (or, if the Administrative Agent has
specified a different address in the notice referred to above, at such address),
such Bank’s Pro Rata Share of the Revolving Credit Loans requested.

     (c) Upon receipt by the Administrative Agent of all such funds, the
Administrative Agent shall disburse to the relevant Borrower on the requested
Borrowing Date the Revolving Credit Loans requested in such Revolving Credit
Loan Request. The Administrative Agent may, but shall not be required to,
advance on behalf of any Bank such Bank’s Pro Rata Share of such Revolving
Credit Loans on a Borrowing Date unless such Bank shall have notified the
Administrative Agent prior to such Borrowing Date that it does not intend to
make available its Pro Rata Share of such Revolving Credit Loans on such date.
If the Administrative Agent makes

14

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such an advance, the Administrative Agent shall be entitled to recover such
amount on demand from the Bank on whose behalf such advance was made, and if
such Bank does not pay the Administrative Agent the amount of such advance upon
demand, the relevant Borrower shall promptly repay such amount to the
Administrative Agent, acting for the Banks. Until such amount is repaid to the
Administrative Agent by such Bank or the relevant Borrower, such advance shall
be deemed for all purposes to be a Revolving Credit Loan made by the
Administrative Agent. The Administrative Agent shall be entitled to recover from
the Bank or such Borrower, as the case may be, interest on the amount advanced
by it for each day from the Borrowing Date therefor until repaid to the
Administrative Agent at a rate per annum equal to (i) in the case of an amount
recovered from any Bank, the Federal Funds Rate or (ii) in the case of an amount
recovered from a Borrower, the higher of the Federal Funds Rate and the interest
rate applicable thereto pursuant to Section 3.01. The failure of any Bank to
make any Loan to be made by it on any Borrowing Date shall not relieve any other
Bank of its obligation, if any, hereunder to make its Loan on such Borrowing
Date, and neither the Administrative Agent nor any other Bank shall be
responsible for the failure by such Bank to make the Loan to be made by such
Bank on such Borrowing Date.

     Section 2.03. Evidence for Loans. (a) Each Bank shall maintain, in
accordance with its customary and usual practice, accounts evidencing the
indebtedness of each Borrower to such Bank resulting from each Loan made by such
Bank from time to time, including an indication of the Applicable Lending Office
and the amounts of principal and interest payable and paid to such Bank in
respect of Loans.

     (b) The Administrative Agent shall maintain, in accordance with its
customary and usual practice, at its address referred to in Section 11.06, a
copy of each Assignment and Acceptance delivered to it and a register (the
“Register”) for the recordation of (i) the names of the Borrowers, (ii) the
amount of each Loan, whether such Loan is a Revolving Credit Loan or a
Competitive Advance Loan, the interest rate options, the Interest Period or
Maturity Date (if any) applicable thereto and the Borrower thereof, (iii) the
amount of any principal or interest due and payable or to become due and payable
from each Borrower to each Bank hereunder, (iv) the amount of any payments
received by the Administrative Agent hereunder from each Borrower and each
Bank’s share thereof and (v) with respect to each Assignment and Acceptance
delivered to the Administrative Agent, the name and address of the Assignee and
the principal amount of each Loan owing to such Assignee. The Register shall be
available for inspection during ordinary business hours by the Borrowers or any
Bank or Assignee from time to time upon reasonable prior notice to the
Administrative Agent.

     (c) The entries made in the Register and the foregoing accounts shall, to
the extent permitted by applicable law, be prima facie evidence of the existence
and amounts of the indebtedness of each Borrower therein recorded; provided,
however, that the failure of any Bank or the Administrative Agent to maintain
the Register or any such account, as applicable, or any error therein, shall not
in any manner affect the validity or enforceability of any obligation of a
Borrower to repay any Loan actually made to such Borrower by such Bank in
accordance with the terms of this Agreement. The entries in the Register
relating to assignments shall be conclusive, in the absence of clearly
demonstrable error, and the Borrowers, the Administrative Agent and the Banks
may treat each Person whose name is recorded in the Register as the owner of the
Loan recorded therein for all purposes of this Agreement.

15

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     (d) A Borrower’s obligation to repay any Revolving Credit Loan or
Competitive Advance Loan that shall be assigned to a Federal Reserve Bank by a
Bank shall, to the extent requested by such Bank in order to effect such
assignment, be evidenced by one or more Notes, in substantially the form of
Exhibit B-1 (a “Revolving Credit Note”) or Exhibit B-2 (a “Competitive Advance
Note”), as appropriate. A Revolving Credit Note shall be (i) in the principal
amount of the Loan or Loans so assigned and (ii) stated to mature on the
Termination Date applicable to such Bank and bear interest from its date until
paid in full on the principal balance (from time to time outstanding thereunder)
payable at the rates and in the manner provided herein. A Competitive Advance
Note shall be (i) in the principal amount of the Competitive Advance Loan made
by such Bank and so assigned, (ii) stated to mature on the Maturity Date for
such Competitive Advance Loan and bear interest from its date until paid in full
on the principal balance (from time to time outstanding thereunder) payable at
the rates and in the manner provided herein and (iii) not prepayable by the
Borrower.

     Section 2.04. Increase of Commitment. API may from time to time, by notice
to the Administrative Agent (which shall promptly deliver a copy to each of the
Banks), request that the Total Commitment be increased by $10,000,000 or an
integral multiple thereof and will not result in the Total Commitment exceeding
$1,250,000,000. Each such notice shall set forth the requested amount of the
increase in the Total Commitment and the date on which such increase is to
become effective (which shall be not fewer than twenty days after the date of
such notice), and shall offer each Bank the opportunity to increase its
Commitment by its ratable share, based on the amounts of the Banks’ Commitments
on the date of such notice, of the requested increase in the Total Commitment.
Each Bank shall, by notice to API and the Administrative Agent given not more
than ten Business Days after the date of API’s notice, either agree to increase
its Commitment by all or a portion of the offered amount or decline to increase
its Commitment (and any Bank that does not deliver such a notice within such
period of ten Business Days shall be deemed to have declined to increase its
Commitment). In the event that, on the tenth Domestic Business Day after API
shall have delivered a notice pursuant to the first sentence of this paragraph,
the Banks shall have agreed pursuant to the preceding sentence to increase their
Commitments by an aggregate amount less than the increase in the Total
Commitment requested by API, API shall have the right to arrange for one or more
banks or other financial institutions (any such bank or other financial
institution being called an “Augmenting Bank”), which may include any Bank, to
extend Commitments or increase their existing Commitments in an aggregate amount
equal to the unsubscribed amount, provided that each Augmenting Bank, if not
already a Bank hereunder, shall be subject to the approval of the Administrative
Agent (which approval shall not be unreasonably withheld or delayed) and shall
execute all such documentation as the Administrative Agent shall specify to
evidence its status as a Bank hereunder. If (and only if) Banks (including
Augmenting Banks) shall have agreed to increase their Commitments or to extend
new Commitments in an aggregate amount not less than $10,000,000, such increases
and such new Commitments shall become effective on the date specified in the
notice delivered by API pursuant to the first sentence of this Section.
Notwithstanding the foregoing, no increase in the Total Commitment (or in the
Commitment of any Bank) shall become effective under this paragraph unless, on
the date of such increase, (i) the conditions set forth in paragraphs (b) and
(c) of Section 6.02 (including the condition set forth in Section 6.02(c)
insofar as it relates to representations and warranties contained in Sections
5.01(d)(ii) and 5.01(e) which are otherwise excluded in Section 6.02) shall be
satisfied and the Administrative Agent shall have received a certificate to that
effect dated such

16

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date and executed by a Responsible Officer of API or (ii) the Banks shall have
waived the requirements set forth in clause (i) of this sentence.

     Section 2.05. Reduction of Commitments. API shall have the right, upon not
less than three Domestic Business Days’ telephonic notice (promptly confirmed in
writing) from API to the Administrative Agent and, if the Total Commitment is
thereby to be reduced to zero, upon payment of the Facility Fee accrued to (but
excluding) the date of such reduction, to reduce the Total Commitment in full or
in part; provided, however, that the amount of any reduction in the Total
Commitment may not exceed the Available Facility (after giving effect to any
Loans being repaid or prepaid on the day of such reduction and any Loans to be
made on such day). Partial reductions of the Total Commitment shall be in the
amount of $10,000,000 or in integral multiples of $1,000,000 in excess thereof
(or, if the Available Facility is less than $10,000,000, then all of such lesser
amount). Subject to Section 2.04, all reductions of the Total Commitment shall
be permanent.

     Section 2.06. Prepayment of Revolving Credit Loans. A Borrower shall have
the right, by giving telephonic notice (promptly confirmed in writing) to the
Administrative Agent by not later than 10:30 A.M., New York time, (i) on the day
of prepayment in the case of ABR Loans and (ii) on the third Eurodollar Business
Day prior to the day of prepayment in the case of Revolving Eurodollar Loans, to
prepay Revolving Credit Loans of such Borrower bearing interest on the same
basis and having the same Interest Period, if any, in whole or in part, without
premium or penalty, in the aggregate principal amount of $10,000,000 or integral
multiples of $1,000,000 in excess thereof (or, if the outstanding aggregate
principal amount of such Revolving Credit Loan is less than $10,000,000, then
all of such lesser amount), together with accrued interest (except for ABR
Loans, as to which such interest shall be paid on the next date when it
otherwise would be payable under 3.02) on the principal being prepaid to (but
excluding) the date of prepayment and, in the case of Revolving Eurodollar
Loans, the amounts required by Section 4.03. Subject to the terms and conditions
hereof, Revolving Credit Loans so prepaid may be reborrowed by any Borrower.

     Section 2.07. Competitive Advance Loans. (a) Prior to the Final Termination
Date, a Borrower may request that the Banks make offers to make Competitive
Advance Loans on the terms and conditions hereinafter set forth; provided,
however, that (i) the amount of Competitive Advance Loans that may be borrowed
on any Borrowing Date may not exceed the Available Facility (after giving effect
to any Loans to be repaid or prepaid on such Borrowing Date and any other Loans
to be made on such Borrowing Date), (ii) the aggregate amount of Competitive
Advance Loans which may be outstanding on any day may not exceed the Total
Commitment (after giving effect, with respect to any day, to any Loans being
repaid or prepaid on such day and any other Loans to be made on such day), and
(iii) such Borrower may not request Competitive Advance Loans before the fifth
Domestic Business Day after the Effective Date. Each Bank may, but shall have no
obligation to, make such offers and a Borrower may, but shall have no obligation
to, accept any such offers, in the manner set forth in this Section 2.07.

     (b) A Borrower may request Competitive Advance Loans under this Section
2.07 by a Competitive Advance Loan Request, in substantially the form of Exhibit
C-2, given to the Administrative Agent not later than the Competitive Advance
Notice Time therefor. The Competitive Advance Loan Request shall indicate
whether the solicitation of Competitive Advance

17

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Bids shall be conducted by the Administrative Agent in New York or in London.
The Administrative Agent shall promptly notify each Bank, by a letter in
substantially the form of Exhibit C-3, of each Competitive Advance Loan Request
received by it from a Borrower and of the terms contained therein.

     (c) Each Bank may, if it elects so to do, irrevocably offer to make a
Competitive Advance Loan of the requested type to the requesting Borrower at a
Competitive Advance Bid Rate or Rates, as specified by such Bank in accordance
with the related Competitive Advance Loan Request, by submitting to the
Administrative Agent (which shall give prompt notice thereof to such Borrower) a
Competitive Advance Bid, in substantially the form of Exhibit C-4, before the
Competitive Advance Bid Deadline, of the maximum and minimum principal amounts
of the Competitive Advance Loan which such Bank would be willing to make (which
amount may, subject to the proviso to the first sentence of Section 2.07(a),
exceed such Bank’s Commitment, but shall be in a principal amount equal to
$5,000,000 or an integral multiple of $1,000,000 in excess thereof), the rate or
rates of interest therefor or the applicable margin over LIBOR for the relevant
Interest Period, as the case may be, and any other terms and conditions required
by such Bank. If any Bank shall fail to submit a Competitive Advance Bid to the
Administrative Agent before the Competitive Advance Bid Deadline, then such Bank
shall be deemed to have elected not to make an offer to make a Competitive
Advance Loan. If a Bank submits a Competitive Advance Bid pursuant to this
Section 2.07 specifying that such Bank is waiving the right to claim
compensation under Section 3.03(c), 4.04(a) or 4.04(b), such Bank shall be
deemed to have waived the right to claim such compensation under such Section
3.03(c), 4.04(a) or 4.04(b) in connection with any Competitive Advance Loan or
Loans thereafter made by such Bank pursuant to such Competitive Advance Bid; and
the Borrower shall be entitled to make a reasonable determination that a
Competitive Advance Bid in which a Bank has waived the right to any such
compensation is made at a Competitive Advance Bid Rate lower than an otherwise
identical or lower Competitive Advance Bid including no such waiver. The
Administrative Agent shall (i) disclose the Competitive Advance Bids received to
the relevant Borrower as promptly as reasonably practicable after the Bid
Deadline, (ii) maintain all Competitive Advance Bids in confidence until each of
them has been disclosed to such Borrower and (iii) provide copies of all
Competitive Advance Bids to the relevant Borrower as soon as practicable after
completion of the bidding process set forth in this Section 2.07.

     (d) A Borrower that made a Competitive Advance Loan Request shall, before
the Competitive Advance Accept/ Reject Deadline, either

>      (i) cancel the Competitive Advance Loan Request by giving the
> Administrative Agent notice to that effect, or
> 
>      (ii) accept one or more Competitive Advance Bids, in its sole discretion,
> by giving notice in substantially the form of Exhibit C-5 (a “Competitive
> Advance Accept/Reject Notice”) to the Administrative Agent of the principal
> amount of each Competitive Advance Loan (which principal amount shall be equal
> to or greater than the minimum amount offered by such Bank and equal to or
> less than the maximum amount offered by such Bank for such Competitive Advance
> Loan pursuant to Section 2.07(c)) to be made by the Bank or Banks that made
> such Competitive Advance Bid or Bids, and reject any remaining Competitive
> Advance Bids, by giving the Administrative Agent notice to

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> that effect; provided that the aggregate principal amount of such Competitive
> Advance Bids accepted by such Borrower shall be in a principal amount equal to
> $5,000,000 or an integral multiple of $1,000,000 in excess thereof; and
> provided further that (A) the failure by such Borrower to give such notice in
> a timely fashion shall be deemed to be a rejection of all Competitive Advance
> Bids, (B) such Borrower shall not accept a Competitive Advance Bid made at a
> Competitive Advance Bid Rate if such Borrower has rejected a Competitive
> Advance Bid made at a lower Competitive Advance Bid Rate, (C) the aggregate
> principal amount of the Competitive Advance Bids accepted by such Borrower
> shall not exceed the principal amount specified in the related Competitive
> Advance Loan Request, (D) if such Borrower shall accept a Competitive Advance
> Bid made at a particular Competitive Advance Bid Rate but the amount of such
> Competitive Advance Bid shall cause the total amount of Competitive Advance
> Bids accepted by the Borrower to exceed the amount specified in the
> Competitive Advance Loan Request, then such Borrower shall (notwithstanding
> the minimum bid acceptance amount required by clause (F) below) accept a
> portion of such Competitive Advance Bid in an amount equal to the amount
> specified in the Competitive Advance Loan Request less the amount of all other
> Competitive Advance Bids accepted with respect to such Competitive Advance
> Loan Request, (E) if such Borrower shall accept Competitive Advance Bids made
> at a particular Competitive Advance Bid Rate but shall be restricted by other
> conditions hereof from borrowing the principal amount of Competitive Advance
> Loans specified in such Competitive Advance Loan Request in respect of which
> Competitive Advance Bids at such Competitive Advance Bid Rate have been made
> or if such Borrower shall accept Competitive Advance Bids made at a particular
> Competitive Advance Bid Rate but the aggregate amount of Competitive Advance
> Bids made at such Competitive Advance Bid Rate shall exceed the amount
> specified in the Competitive Advance Loan Request, then such Borrower shall
> accept a pro rata portion of each Competitive Advance Bid made at such
> Competitive Advance Bid Rate aggregating the portion of Competitive Advance
> Loans with respect to which Competitive Advance Bids at such Competitive
> Advance Bid Rate have been received (provided further that if the principal
> amount of Competitive Advance Loans to be so allocated is not sufficient to
> enable Competitive Advance Loans to be so allocated to each such Bank in a
> principal amount equal to $5,000,000 or an integral multiple of $1,000,000 in
> excess thereof such Borrower shall select the Banks to be allocated such
> Competitive Advance Loans in a principal amount equal to not less than
> $5,000,000 but may round up allocations to the next higher integral multiple
> of $1,000,000 if necessary) and (F) except as provided in clauses (D) and (E)
> above, no Competitive Advance Bid shall be accepted for a Competitive Advance
> Loan unless such Competitive Advance Loan is in a principal amount equal to
> $5,000,000 or an integral multiple of $1,000,000 in excess thereof.

     (e) If the Borrower that made a Competitive Advance Loan Request notifies
the Administrative Agent that such Competitive Advance Loan Request is cancelled
in accordance with Section 2.07(d)(i), the Administrative Agent shall give
prompt notice thereof to the Banks.

     (f) If the Borrower that made a Competitive Advance Loan Request accepts
one or more Competitive Advance Bids, the Administrative Agent shall promptly
give notice (i) to each Bank that submitted a Competitive Advance Bid of the
date and aggregate amount of such Competitive Advance Loan(s) and whether or not
any Competitive Advance Bid made by such Bank has been accepted by the Borrower,
(ii) to each Bank whose Competitive Advance Bid, or

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any portion thereof, has been accepted by the Borrower, of the amount of the
Competitive Advance Loan to be made by such Bank and the date for repayment
thereof, together with the Competitive Advance Rate or Competitive Advance
Margin, as applicable, and any other terms applicable to such Competitive
Advance Loan and (iii) to each Bank of the principal amounts and Competitive
Advance Bid Rates specified in each of the Competitive Advance Bids submitted in
response to the related Competitive Advance Loan Request.

     (g) Following any acceptance by the Borrower and notification by the
Administrative Agent pursuant to clause (f) above, and upon satisfaction or
waiver of the conditions precedent contained in Article 6 applicable thereto,
each such Bank shall disburse to such Borrower on the specified Borrowing Date
Competitive Advance Loans in the aggregate amount accepted by such Borrower, in
the manner and subject to the same terms and conditions set forth in Section
2.02(c) with respect to ABR Loans, mutatis mutandis.

     (h) Nothing in this Section 2.07 shall be construed as a right of first
offer in favor of the Banks or to otherwise limit the ability of a Borrower to
request and accept credit facilities from any Person (including any Bank).

     Section 2.08. Purpose of Loans. The proceeds of the Revolving Credit Loans
will be used for general corporate purposes, which shall include the use
thereof, directly or indirectly, for the purpose, whether immediate, incidental
or ultimate, of funding or making payments on account of the purchase or
redemption by API of any shares of capital stock of API or any related option,
warrant or similar right.

     Section 2.09. Extension of Termination Date. (a) At least 45 days but not
more than 60 days prior to the first and/or second anniversary of the Effective
Date, API, by written notice to the Administrative Agent, may request an
extension of the Termination Date in effect at such time by one year from its
then scheduled expiration. The Administrative Agent shall promptly notify each
Bank of such request, and each Bank shall in turn, in its sole discretion, not
later than 20 days prior to the applicable anniversary date, notify API and the
Administrative Agent in writing as to whether such Bank will consent to such
extension. If any Bank shall fail to notify the Administrative Agent and API in
writing of its consent to any such request for extension of the Termination Date
at least 20 days prior to the applicable anniversary date, such Bank shall be
deemed to be a Non-Extending Bank with respect to such request for an extension
of the Termination Date.

     (b) If all the Banks consent in writing to any such request in accordance
with subsection (a) of this Section 2.09, the Termination Date in effect at such
time shall, effective as at the applicable anniversary of the Effective Date (an
“Extension Date”), be extended for one year, subject to subsection (e) of this
Section 2.09. If less than all of the Banks consent in writing to any such
request in accordance with subsection (a) of this Section 2.09, the Termination
Date in effect at such time shall not be extended as to any Bank that has not so
consented (each a “Non-Extending Bank”). To the extent that the Termination Date
is not extended as to any Bank pursuant to this Section 2.09 and the Commitment
of such Bank is not assumed in accordance with subsection (c) of this Section
2.09 on or prior to the applicable Extension Date, the Commitment of such
Non-Extending Bank shall automatically terminate in whole on such unextended
Termination Date without any further notice or other action by API, such Bank or
any other Person. It is understood

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and agreed that no Bank shall have any obligation whatsoever to agree to any
request made by API for any extension of the Termination Date.

     (c) If less than all of the Banks consent to any such request pursuant to
subsection (a) of this Section 2.09, the Administrative Agent shall promptly so
notify the Extending Banks, and each Extending Bank may, in its sole discretion,
give written notice to the Administrative Agent not later than 10 days prior to
the applicable Extension Date of the amount of the Non-Extending Banks’
Commitments for which it is willing to accept an assignment. If the Extending
Banks notify the Administrative Agent that they are willing to accept
assignments of Commitments in an aggregate amount that exceeds the amount of the
Commitments of the Non-Extending Banks, such Commitments shall be allocated
among the Extending Banks willing to accept such assignments in such amounts as
are agreed between API and the Administrative Agent. If after giving effect to
the assignments of Commitments described above there remains any Commitments of
Non-Extending Banks, API may arrange for one or more Extending Banks or other
banks or financial institutions (each, an “Assuming Bank”) to assume, effective
as of the Extension Date, any Non-Extending Bank’s Commitment and all of the
obligations of such Non-Extending Bank under this Agreement thereafter arising,
without recourse to or warranty by, or expense to, such Non-Extending Bank;
provided, however, that the amount of the Commitment of any such Assuming Bank
as a result of such substitution shall in no event be less than $10,000,000
unless the amount of the Commitment of such Non-Extending Bank is less than
$10,000,000, in which case such Assuming Bank shall assume all of such lesser
amount; and provided further that:

>      (i) any such Assuming Bank shall have paid to such Non-Extending Bank (A)
> the aggregate principal amount of, and any interest accrued and unpaid to the
> effective date of the assignment on, the outstanding Advances, if any, of such
> Non-Extending Bank plus (B) any accrued but unpaid Facility Fees and
> Utilization Fees owing to such Non-Extending Bank as of the effective date of
> such assignment;
> 
>      (ii) all additional costs reimbursements, expense reimbursements and
> indemnities payable to such Non-Extending Bank, and all other accrued and
> unpaid amounts owing to such Non-Extending Bank hereunder, as of the effective
> date of such assignment shall have been paid to such Non-Extending Bank; and
> 
>      (iii) with respect to any such Assuming Bank, the applicable processing
> and recordation fee required under Section 11.08(c) for such assignment shall
> have been paid.

At least three Business Days prior to the effective date of any such assignment,
(A) each such Assuming Bank shall have delivered confirmation in writing
satisfactory to API and the Administrative Agent as to the amount of its
Commitment and (B) each Non-Extending Bank being replaced pursuant to this
Section 2.09 shall have delivered to the Administrative Agent any Note or Notes
held by such Non-Extending Bank. Upon the payment or prepayment of all amounts
referred to in clauses (i), (ii) and (iii) of the immediately preceding
sentence, each such Assuming Bank, as of the Extension Date, will be substituted
for such Non-Extending Bank under this Agreement and shall be a Bank for all
purposes of this Agreement, without any further acknowledgment by or the consent
of the other Banks, and the obligations of each such Non-Extending Bank
hereunder shall, by the provisions hereof, be released and discharged.

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     (d) If (after giving effect to any assignments or assumptions pursuant to
subsection (c) of this Section 2.09) Banks having Commitments equal to at least
50% of the Commitments in effect immediately prior to the applicable Extension
Date consent in writing to a requested extension not later than one Business Day
prior to such Extension Date, the Administrative Agent shall so notify API, and,
subject to subsection (e) of this Section 2.09, the Termination Date then in
effect shall be extended for the additional one-year period in respect of all
Extending Banks and Assuming Banks that become parties hereto pursuant to an
assignment from a Non-Extending Bank as described in subsection (c) of this
Section 2.09, and all references in this Agreement, and in the Notes, if any, to
the “Termination Date” shall, with respect to each Extending Bank and each such
Assuming Bank, refer to the Termination Date as so extended. Promptly following
each Extension Date, the Administrative Agent shall notify the Banks (including,
without limitation, each Assuming Bank) of the extension of the scheduled
Termination Date in effect immediately prior thereto and shall thereupon record
in the Register the relevant information with respect to each such Extending
Bank and each such Assuming Bank. If the Termination Date is extended as
provided in this paragraph (d), any Non-Extending Bank, and any assignee of a
Non-Extending Bank, may become an Extending Bank by giving notice to that effect
to the Administrative Agent indicating its intention to extend its Commitment to
the Termination Date as so extended.

     (e) Notwithstanding the foregoing, no extension of the Termination Date
shall become effective under this Section 2.09 unless, on the applicable
Extension Date, (i) the conditions set forth in paragraphs (b) and (c) of
Section 6.02 (including the condition set forth in Section 6.02(c) insofar as it
relates to representations and warranties contained in Sections 5.01(d)(ii) and
5.01(e) which are otherwise excluded in Section 6.02) shall be satisfied and the
Administrative Agent shall have received a certificate to that effect dated such
date and executed by a Responsible Officer of API or (ii) the Banks shall have
waived the requirements set forth in clause (i) of this sentence.

ARTICLE 3

INTEREST, CONVERSION, FEES, ETC.

     Section 3.01. Procedure for Interest Rate Determination. (a) Unless a
Borrower shall request in a Revolving Credit Loan Request or in a Conversion
Request that its Revolving Credit Loans, or portions thereof, bear interest as
Revolving Eurodollar Loans, such Borrower’s Revolving Credit Loans shall bear
interest as ABR Loans.

     (b) Each Competitive Advance Loan shall bear interest on the basis, or at
the rate per annum, determined pursuant to Section 2.07 and Section 3.03 or
3.04, as appropriate.

     Section 3.02. Interest on ABR Loans. Each ABR Loan shall bear interest from
the date of such ABR Loan until paid in full, or (if converted into a Revolving
Eurodollar Loan) to (but excluding) the first day of the relevant Interest
Period, payable in arrears on the last day of each calendar quarter, commencing
with the first such date after the date hereof, and on the date such Loan is
repaid, at a rate per annum (on the basis of (i) a 365-day year (366 days in the
case of a leap year) if the Base Rate is calculated based on the prime rate and
(ii) a 360-day year if the Base

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Rate is calculated based on the Federal Funds Rate, for the actual number of
days involved) equal to the Base Rate in effect from time to time, which rate
shall change as and when said Base Rate shall change.

     Section 3.03. Interest on Revolving Eurodollar Loans and Competitive
Eurodollar Loans. (a) Each Revolving Eurodollar Loan and each Competitive
Eurodollar Loan shall bear interest from the date of such Loan to (but
excluding) the last day of the relevant Interest Period, or (if earlier) to (but
excluding) the Final Termination Date (in the case of a Revolving Eurodollar
Loan) or the Maturity Date (in the case of a Competitive Eurodollar Loan),
payable in arrears (A) with respect to Interest Periods of three months or less,
on the last day of such Interest Period, and (B) with respect to Interest
Periods longer than three months, on the date which occurs three months after
the first day of such Interest Period and on the last day of such Interest
Period, at a rate per annum (on the basis of a 360-day year for the actual
number of days involved, with respect to each Interest Period, equal to the sum
of (i) the Revolving Eurodollar Margin, in the case of a Revolving Eurodollar
Loan, or the Competitive Advance Margin, in the case of a Competitive Eurodollar
Loan, and (ii) LIBOR.

     (b) The Interest Period for each Revolving Eurodollar Loan shall be
selected by the relevant Borrower at least three Eurodollar Business Days prior
to the beginning of such Interest Period. If such Borrower fails to notify the
Administrative Agent of the Interest Period for a subsequent Revolving
Eurodollar Loan at least three Eurodollar Business Days prior to the last day of
the then current Interest Period of an outstanding Revolving Eurodollar Loan,
then such outstanding Revolving Eurodollar Loan shall become an ABR Loan at the
end of such current Interest Period.

     (c) For so long as any Bank maintains reserves against “Eurocurrency
Liabilities” pursuant to Regulation D of the Federal Reserve Board (or any
successor regulation), each Borrower shall, subject to the two next succeeding
sentences, contemporaneously with the related interest payments, pay additional
interest on each Eurodollar Loan of such Bank at a rate per annum up to but not
exceeding the excess of (i) (A) LIBOR divided by (B) one minus the Eurodollar
Reserve Percentage over (ii) LIBOR. Each Bank shall promptly notify API, with a
copy to the Administrative Agent, upon becoming aware that any Borrower may be
required to make a payment pursuant to this Section 3.03(c) . When requesting
payment pursuant to this Section 3.03(c), each Bank shall provide to API, with a
copy to the Administrative Agent, a certificate, signed by an officer of such
Bank, setting forth, in reasonable detail, the basis of such claim, the amount
required to be paid by the Borrower to such Bank and the computations made by
such Bank to determine such amount. Absent demonstrable error, such certificate
shall be binding as to the amounts of additional interest owing in respect of
such Bank’s Eurodollar Loans.

     Section 3.04. Interest on Competitive Absolute Rate Loans. Each Competitive
Absolute Rate Loan shall bear interest from the date of such Competitive
Absolute Rate Loan to (but excluding) its Maturity Date, payable in arrears on
the date such Loan is repaid, at a rate per annum (on the basis of a 360-day
year for the actual number of days involved) equal to the Competitive Advance
Rate applicable to such Competitive Absolute Rate Loan.

     Section 3.05. Continuation and Conversion of Revolving Credit Loans. (a) A
Borrower may request, by telephonic notice to the Administrative Agent of a
Conversion Request,

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confirmed in writing in substantially the form of Exhibit D by no later than
4:00 P.M., New York time, on the same day, in advance of the requested
Conversion Date as provided in the definition of “Conversion Request”, that:

>      (i) all the outstanding ABR Loans of such Borrower, or a portion thereof
> in an aggregate amount equal to $10,000,000 or an integral multiple of
> $1,000,000 in excess thereof, be converted into a Revolving Eurodollar Loan on
> the requested Conversion Date; or
> 
>      (ii) all the Revolving Eurodollar Loans of such Borrower having the same
> Interest Period, or a portion thereof in an aggregate amount equal to
> $10,000,000 or an integral multiple of $1,000,000 in excess thereof, be
> converted into ABR Loans on the requested Conversion Date.

     (b) Upon receipt of any such Conversion Request from a Borrower, the
Administrative Agent shall forthwith give notice to each Bank of the substance
thereof. Effective on such Conversion Date and upon payment by such Borrower of
the amounts, if any, required by Section 4.03, the Revolving Credit Loans or
portions thereof as to which the Conversion Request was made shall commence to
accrue interest as set forth in this Article 3 for the type of interest rate
and, in the case of a conversion of ABR Loans into Revolving Eurodollar Loans,
Interest Period selected by such Borrower.

     Section 3.06. Post-Maturity Interest. After maturity (whether by
acceleration or otherwise) of any Loan, such Loan shall bear interest, payable
on demand, at a rate per annum equal to the sum of (i) 2% plus (ii) the Base
Rate in effect from time to time.

     Section 3.07. Maximum Interest Rate. (a) Nothing in this Agreement or any
other Credit Document shall require a Borrower to pay interest at a rate
exceeding the maximum rate permitted by applicable law. Neither this Section nor
Section 11.01 is intended to limit the rate of interest payable for the account
of any Bank to the maximum rate permitted by the laws of the State of New York
(or any other applicable law) if a higher rate is permitted with respect to such
Bank by supervening provisions of U.S. federal law.

     (b) If the amount of interest payable by a Borrower for the account of any
Bank on any interest payment date in respect of the immediately preceding
interest computation period, computed pursuant to this Article III, would exceed
the maximum amount permitted by applicable law to be charged by such Bank, the
amount of interest payable for its account on such interest payment date shall
automatically be reduced to such maximum permissible amount.

     Section 3.08. Fees. (a) The Borrowers, jointly and severally, agree to pay,
in arrears on each Fee Payment Date, to the Administrative Agent for the account
of the Banks, a fee (the “Facility Fee”) for each day during the quarterly
period (or shorter period commencing on the Effective Date or ending on the
Final Termination Date) ending on the Business Day immediately preceding such
Fee Payment Date computed by applying the applicable percentages per annum set
forth below based on the ratings on such day of API’s senior unsecured long-term
debt (each range of ratings listed under any Level being inclusive of the
ratings so listed) to the amount of the Total Commitment on such day: Facility
Fee Percentage Per Annum

24

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    Facility Fee Percentage Per Annum  

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

  Level I                          Moody’s: Aa3 or above                      
 S&P: AA- or above 0.0500%   Level II                          Moody’s: A1      
                 S&P: A+ 0.0600%   Level III                          Moody’s:
A2                        S&P: A 0.0650%   Level IV:                        
 Moody’s: A3                        S&P: A- 0.0800%   Level V:                  
       Moody’s: Baa1 or lower                        S&P: BBB+ or lower 0.1000%
 

     (b) The Borrowers, jointly and severally, agree to pay, in arrears on each
Fee Payment Date, to the Administrative Agent for the account of the Banks, a
fee (the “Utilization Fee”) for each day during the quarterly period (or shorter
period commencing on the Effective Date or ending on the Final Termination Date)
ending on the Business Day immediately preceding such Fee Payment Date on which
the aggregate outstanding principal amount of the Loans exceeds 50% of the Total
Commitment on such day computed by applying the applicable percentages per annum
set forth below based on the ratings on such day of API’s senior unsecured
long-term debt (each range of ratings listed under any Level being inclusive of
the ratings so listed) to the aggregate principal amount of the Loans
outstanding on such day:

    Utilization Fee Percentage Per       Annum  

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

  Level I                          Moody’s: Aa3 or above                      
 S&P: AA- or above 0.0500%   Level II                          Moody’s: A1      
                 S&P: A+ 0.0500%   Level III                          Moody’s:
A2                        S&P: A 0.0500%   Level IV:                        
 Moody’s: A3                        S&P: A- 0.0500%   Level V:                  
       Moody’s: Baa1 or lower                        S&P: BBB+ or lower 0.1000%
 

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     (c) For purposes of Sections 3.08(a) and 3.08(b), (i) if no rating for
API’s senior unsecured long-term debt shall be available from either rating
agency, such rating agency shall be deemed to have established a Level V rating,
(ii) if the ratings established or deemed established by Moody’s and S&P shall
fall within different Levels, the Facility Fee and Utilization Fee shall be
based upon the Level corresponding to the more favorable of such ratings except
if the lower of such ratings is more than one Level below the higher of such
ratings, the Facility Fee and Utilization Fee shall be based upon the Level that
is one Level below the higher of such ratings and (iii) if any rating
established or deemed established by Moody’s or S&P shall be changed (other than
as a result of a change in the rating system of either Moody’s or S&P), such
change shall be given effect on and as of the opening of business on the date
when such change is first announced by the rating agency making such change. If
the rating system of either Moody’s or S&P shall change prior to the Final
Termination Date, API and the Banks shall negotiate in good faith to amend the
references to specific ratings in this Section 3.08 to reflect such changed
rating system.

     (d) Each of the Facility Fee and Utilization Fee shall be computed based on
a 365-day year (366 days in the case of a leap year), for the actual number of
days involved.

ARTICLE 4

DISBURSEMENT AND PAYMENT

     Section 4.01. Disbursement of Loans; Pro Rata Treatment of Banks. (a) ABR
Loans shall be made by each Bank from its ABR Lending Office.

     (b) Eurodollar Loans shall be made by each Bank from its Eurodollar Lending
Office.

     (c) Each payment of a Facility Fee or Utilization Fee, each reduction of
the Total Commitment and, except as expressly provided otherwise in this
Agreement, each payment of principal of or interest on Revolving Credit Loans
shall be apportioned among the Banks in proportion to each Bank’s Pro Rata
Share.

     Section 4.02. Method of Payment. (a) All payments of principal of and
interest on the Loans and of fees hereunder shall be payable in Dollars.

     (b) All payments to be made by the Borrowers hereunder shall be made not
later than 2:00 P.M., New York time, on the date when due, in Federal or other
funds immediately available in New York City, to the Administrative Agent at its
office referred to in Section 11.06 hereof.

     (c) Whenever any payment of principal of, or interest on, ABR Loans or
Competitive Absolute Rate Loans, or fees shall be due on a day which is not a
Domestic Business Day, the date for payment thereof shall be extended to the
next succeeding Domestic Business Day. Whenever any payment of principal of, or
interest on, Eurodollar Loans shall be due on a day which is not a Eurodollar
Business Day, the date for payment thereof shall be extended to the next
succeeding Eurodollar Business Day unless such Eurodollar Business Day falls in
another calendar

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month, in which case the date for payment thereof shall be the next preceding
Eurodollar Business Day. If the date for any payment of principal is extended by
operation of law or otherwise, interest thereon shall be payable for such
extended time.

     (d) Unless the Administrative Agent shall have received notice from the
relevant Borrower prior to the date on which any payment is due to the Banks
hereunder that such Borrower will not make such payment in full, the
Administrative Agent may assume that such Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, but shall not be obligated to, cause to be
distributed to each Bank on such due date an amount equal to the amount then due
such Bank. If and to the extent that such Borrower shall not have so made such
payment, each Bank shall repay to the Administrative Agent forthwith on demand
such amount distributed to such Bank together with interest thereon, for each
day from the date such amount is distributed to such Bank until the date such
Bank repays such amount to the Administrative Agent, at the Federal Funds Rate.

     (e) Any and all payments made by a Borrower to the Administrative Agent or
the Banks hereunder shall be made without right of set-off, counterclaim or
other defenses.

     (f) The Administrative Agent will promptly cause any payments received by
it to be distributed to each Bank for whose account payment has been made in
like funds.

     Section 4.03. Compensation for Losses. (a) Compensation. If (i) a Borrower
makes a prepayment of a Revolving Eurodollar Loan under Section 2.06 (other than
a prepayment to a Bank to which Additional Costs or Additional Amounts may be
due that has not complied with its obligations under Section 4.04(c)), or a
Conversion Date selected by a Borrower pursuant to Section 3.05 for the
conversion of Eurodollar Loans, or portions thereof, falls on a day other than
the last day of the Interest Period for the amount so converted, (ii) a Borrower
revokes any Borrowing Request for a Eurodollar Loan or any Eurodollar Loan or
Competitive Advance Loan requested is not made because of the failure of the
applicable conditions precedent specified in Section 6.02 to be satisfied, (iii)
an outstanding Eurodollar Loan, or any portion thereof, is converted into an ABR
Loan pursuant to Section 4.05 on any day other than the last day of the Interest
Period applicable thereto or (iv) a Eurodollar Loan or Competitive Advance Loan
(or portion thereof) shall be due and payable pursuant to Section 4.07, or
declared to be due and payable prior to the scheduled maturity thereof pursuant
to Section 8.01, on any day other than the last day of the Interest Period
applicable thereto, then, subject to Section 4.03(b) and without duplication of
any amounts described in Section 3.03(c) or 4.04, the relevant Borrower shall be
obligated to pay to the relevant Bank an amount that will compensate such Bank
for any loss or premium, penalty or expense incurred by such Bank as a result of
such prepayment, conversion, failure to borrow, declaration or revocation of
notice in respect of funds obtained for the purpose of making or maintaining
such Eurodollar Loan or Competitive Advance Loan, or any portion thereof (other
than loss of margin after the date of such prepayment, conversion, failure to
borrow, declaration or revocation of notice). Such compensation may include an
amount equal to the excess, if any, of (i) the amount of interest which would
have accrued on the amount so paid or prepaid, or not borrowed or converted, for
the period from the date of such payment or prepayment or conversion or failure
to borrow to the last day of such Interest Period (or, in the case of a failure
to borrow, the Interest Period that would have commenced on the date of such
failure to borrow) in each case at the applicable rate of interest for such Loan
provided for herein (excluding, however,

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any margin included therein) over (ii) the amount of interest (as determined in
good faith by such Bank) that would have accrued to such Bank on such amount by
placing such amount on deposit for a comparable period with leading banks in the
relevant interbank market.

     (b) Certificate, Etc. Each Bank shall promptly notify API, with a copy to
the Administrative Agent, upon becoming aware that any Borrower may be required
to make any payment pursuant to this Section 4.03. When requesting payment
pursuant to this Section 4.03, such Bank shall provide to API, with a copy to
the Administrative Agent, a certificate, signed by an officer of such Bank,
setting forth in reasonable detail the amount required to be paid by the
Borrowers to such Bank and the computations made by such Bank to determine such
amount. The applicable Borrower shall have a 30-day period following the receipt
of such certificate (if such Borrower in good faith disagrees with the assertion
that any payment under this Section 4.03 is due or with the amount shown as due
on such certificate and so notifies such Bank of such disagreement within five
Business Days following receipt of such certificate) to negotiate with such
Bank, which negotiations shall be conducted by the respective parties in good
faith, and to agree upon another amount that will adequately compensate such
Bank, it being expressly understood that if such Borrower does not provide the
required notice of its disagreement as provided above, then such Borrower shall
pay the amount shown as due on the certificate on the tenth Business Day
following receipt thereof and further if such Borrower does provide such
required notice, and negotiations are entered into in good faith but do not
result in agreement by such Borrower and such Bank within the 30-day period,
then such Borrower shall pay the amount shown as due on the certificate on the
last day of such period.

     Section 4.04. Withholding, Reserves and Additional Costs. (a) Withholding.
(i) All payments payable under this Agreement to a Bank (including payments of
principal of and interest on Loans) shall be made to such Bank free and clear of
any and all present and future taxes, levies, imposts, duties, deductions,
withholdings, fees, liabilities and similar charges other than Excluded Taxes
(“Taxes”). If any Taxes are required to be withheld or deducted from any amount
payable by a Borrower under this Agreement, then the amount so payable under
this Agreement shall be increased to the amount which, after deduction from such
increased amount of all Taxes required to be withheld or deducted therefrom (the
amount of such increase, an “Additional Amount”), will yield to such Bank the
amount stated to be payable under this Agreement. The relevant Borrower shall
execute and deliver to any Bank upon its request such further instruments as may
be necessary or desirable to give full force and effect to any such increase.
The relevant Borrower shall also hold each Bank harmless and indemnify it for
any stamp or other taxes with respect to the preparation, execution, delivery,
recording, performance or enforcement of the Credit Documents (all of which
shall be included within “Taxes”). If any of the Taxes specified in this Section
4.04(a) are paid by a Bank, the relevant Borrower shall, upon demand of such
Bank, promptly reimburse such Bank for such payments, together with any
interest, penalties and expenses incurred in connection herewith. Each Borrower
shall deliver to the Administrative Agent certificates or other valid vouchers
for all Taxes or other charges deducted from or paid with respect to payments
made by such Borrower hereunder. Notwithstanding the foregoing, the Borrowers
shall be entitled, to the extent required to do so by law, to deduct or withhold
(and shall not be required to make payments as otherwise required by this
Section 4.04 on account of such deductions or withholdings) income or other
similar taxes imposed by the United States of America from interest, fees or
other amounts payable hereunder for the account of any Bank other than a Bank
(i) that is a U.S. Person for U.S. federal income tax purposes or (ii) that has
the Prescribed

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Forms on file with the Borrowers for the applicable year to the extent deduction
or withholding of such taxes is not required as a result of such filing of such
Prescribed Forms (unless the failure to leave such forms on file results from a
change in law or regulation or in the interpretation thereof by any court or
administrative or Governmental Authority charged with the administration thereof
subsequent to the date hereof); provided that if a Borrower shall so deduct or
withhold any such taxes, such Borrower shall provide a statement to the
Administrative Agent and such Bank, setting forth the amount of such taxes so
deducted or withheld, the applicable rate and any other information or
documentation which such Bank may reasonably request for assisting such Bank to
obtain any allowable credits or deductions for the taxes so deducted or withheld
in the jurisdiction or jurisdictions in which such Bank is subject to tax.

     (ii) If any Bank has received or been granted a credit against or relief or
remission for, or refund or repayment of, any Tax paid or payable by it in
respect of or which takes account of any Tax with respect to which an Additional
Amount was paid by a Borrower (an “Indemnified Tax”) or other matter giving rise
to such payment, such Bank shall, to the extent it determines in good faith that
it can do so without prejudice to the retention of the amount of such credit,
relief, remission, refund or repayment, pay to such Borrower such amount as such
Bank shall determine in good faith to be attributable to such Indemnified Tax or
other matter and which will leave such Bank (after such payment to the Borrower)
in a position no better or worse than it would have been in had such Borrower
not been required to deduct or withhold such Indemnified Tax or such other
matter had not arisen; provided that such Borrower upon the written request of
such Bank, shall return to such Bank the amount of any such refund, repayment or
benefit of credit in the event that such Bank is required to repay such amount
to the relevant Governmental Authority.

     (b) Additional Costs. (i) Without duplication of any amounts payable
described in Section 3.03(c), 4.04(a) or 4.04(b)(ii), if after the date hereof
there shall have occurred any change in any law or regulation or in the
interpretation thereof by any court or Governmental Authority charged with the
administration thereof or the enactment of any law or regulation shall either
(A) impose, modify or deem applicable any reserve, special deposit or similar
requirement with respect to any Bank’s Commitment or its Revolving Eurodollar
Loans or (subject to Section 2.07(c)) Competitive Eurodollar Loans, (B) subject
such Bank to any duty or other charge with respect to any of its Revolving
Eurodollar Loans or (subject to Section 2.07(c)) Competitive Eurodollar Loans or
its obligations to make Revolving Eurodollar Loans or (C) impose on such Bank
any other condition regarding this Agreement, its Commitment to make Revolving
Eurodollar Loans or its Revolving Eurodollar Loans or (subject to Section
2.07(c)) Competitive Eurodollar Loans and the result of any event referred to in
clause (A), (B) or (C) shall be to increase the cost (“Additional Costs”) to
such Bank of maintaining its Commitment to make Revolving Eurodollar Loans or
making or maintaining its Revolving Eurodollar Loans or (subject to Section
2.07(c)) Competitive Eurodollar Loans or shall reduce the amounts received or
receivable hereunder (which Additional Costs shall be calculated by such Bank in
good faith in accordance with each Bank’s internal policies, including any
reasonable averaging and attribution methods) by an amount which such Bank in
good faith shall determine to be material, then, subject to Sections 4.04(c) and
(d), the relevant Borrower shall pay to such Bank an amount equal to such
Additional Costs.

29

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     (ii) Without duplication of any amounts described in Section 3.03(c),
4.04(a) or 4.04(b)(i), if after the date hereof the adoption of any applicable
law, rule, regulation or guideline regarding capital adequacy, or any change
therein, or any change in the interpretation or administration thereof by any
Governmental Authority, central bank or comparable agency or instrumentality
charged with the interpretation or administration thereof, or compliance by such
Bank with any request or directive regarding capital adequacy (whether or not
having the force of law) of any such Governmental Authority, central bank or
comparable agency or instrumentality, has or would have the effect of reducing
the rate of return on capital for such Bank or any corporation controlling such
Bank as a consequence of its obligations under this Agreement to a level below
that which such Bank shall determine in good faith that reasonably could have
been achieved but for such adoption, change or compliance (taking into
consideration such Bank’s or such corporation’s policies with respect to capital
adequacy), then from time to time, subject to Sections 4.04(c) and (d), the
relevant Borrower shall pay to such Bank such additional amount or amounts as
will compensate such Bank for such reduction.

     (c) Mitigation. If, with respect to a Bank, a condition arises or an event
occurs after the date hereof that would, or would upon the giving of notice,
result in the payment of any Additional Costs or Additional Amounts pursuant to
this Section 4.04 or the delivery by such Bank of any notice described in the
first sentence of Section 4.05, then such Bank, promptly upon becoming aware of
the same, shall notify API (with a copy to the Administrative Agent) thereof and
at API’s request shall take such steps as may be available to it and acceptable
to the Borrowers to mitigate the effects of such condition or event (which shall
include efforts consistent with legal and regulatory restrictions applicable to
it to book the Loans held by such Bank hereunder at another lending office of
such Bank if such other lending office is not, in the reasonable judgment of
such Bank, otherwise disadvantageous to such Bank); provided that such Bank
shall be under no obligation to take any step that, in its good faith judgment,
would result in its incurring any Additional Costs, additional Taxes or other
additional costs in performing its obligations hereunder (unless the Borrower
has agreed to reimburse it for the same) or would, in the good faith judgment of
such Bank, be materially disadvantageous to such Bank.

     (d) Certificate, Etc. Each Bank shall promptly notify API, with a copy to
the Administrative Agent, upon becoming aware that the Borrowers may be required
to make any payment pursuant to this Section 4.04. When requesting payment
pursuant to this Section 4.04, a Bank shall provide to API, with a copy to the
Administrative Agent, a certificate, signed by an officer of such Bank
specifying the event giving rise to such claim and setting forth, in reasonable
detail, the basis of such claim, the amount required to be paid by each Borrower
to such Bank and the computations made by such Bank to determine such amount.
Anything herein notwithstanding, no Bank shall have the right to demand payment
of Additional Amounts or compensation for Additional Costs or a reduced rate of
return under this Section 4.04 (i) with respect to any period more than 180 days
prior to the date it has made a demand pursuant to this Section 4.04, provided
if any Additional Amounts or Additional Costs arise from a change of law that is
retroactive, then the 180 day period shall be extended to include the period of
retroactive effect thereof, (ii) to the extent that such Bank determines in good
faith that the interest rate or margin on the relevant Loans appropriately
accounts for any Additional Costs, (iii) unless demand thereunder is made in
accordance with a policy of the Bank being applied in good faith to all
borrowers similarly situated and (iv) with respect to any Competitive Eurodollar
Loan if it shall have obtained actual knowledge of the change giving rise to
such request at the time of submission of such Bank’s Competitive

30

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Advance Bid pursuant to which such Competitive Eurodollar Loan shall have been
made, unless notice of such Bank’s entitlement to such compensation shall have
been furnished to the relevant Borrower at or prior to such time.

     (e) Prescribed Forms. Each Bank that is not incorporated under the laws of
the United States of America or a state thereof agrees that it will, to the
extent it has not previously done so, deliver to API or the Administrative Agent
(and if to the latter, the Administrative Agent agrees that it will deliver to
API) two duly completed copies of United States Internal Revenue Service Form
W-8BEN or W-8ECI, or successor applicable form, as the case may be, certifying
that such Bank or Administrative Agent is entitled to receive payments under
this Agreement and under the Notes without deduction or withholding of any
United States federal income taxes. Each Bank further undertakes to deliver to
API or the Administrative Agent (and if to the latter, the Administrative Agent
agrees that it will deliver to API) (i) two further duly completed copies of the
said Form W-8BEN or W-8ECI, or successor applicable forms, as the case may be,
on or before the date that any such form expires or becomes obsolete or after
the occurrence of any event requiring a change in the most recent form
previously delivered by it, and such extensions or renewals thereof as may
reasonably be requested by a Borrower, certifying that such Bank or
Administrative Agent is entitled to receive payments under this Agreement and
under any Notes without deduction or withholding of any United States federal
income taxes, unless in any such cases an event (including without limitation
any change in treaty, law or regulation) has occurred prior to the date on which
any such delivery would otherwise be required which renders all such forms
inapplicable or which would prevent a Bank from duly completing and delivering
any such form with respect to it and such Bank advises API or the Administrative
Agent (and the Administrative Agent agrees that it will advise API) that it is
not capable of receiving payments without any deduction or withholding of United
States federal income tax and (ii) two duly completed copies of any other form
or certification that may become applicable to such Bank certifying that such
Bank or Administrative Agent is entitled to receive payments under this
Agreement and under any Notes without deduction or withholding of any United
States federal income taxes.

     Section 4.05. Unavailability and Impracticability. If, after the date
hereof, a Bank shall have determined in good faith that the making or
maintenance of all or any part of such Bank’s Eurodollar Loans has been made (i)
unlawful because of compliance by such Bank with any law or guideline or
interpretation or administration thereof by any official body charged with the
interpretation or administration thereof, in each case issued after the date
hereof, or with any request or directive made after the date hereof of such body
(whether or not having the effect of law) or (ii) impracticable because deposits
in Dollars in the amounts and requested maturities of such Loans are not
available to the Bank in the applicable interbank market, then the
Administrative Agent, upon receipt of written notice of such determination by
such Bank, shall forthwith advise the other Banks and API thereof. After the
date specified in such notice and until such time as the Administrative Agent,
upon receipt of written notice to it by such Bank, shall notify API and the
other Banks that the circumstances specified by it in such notice no longer
apply, then notwithstanding any other provision of this Agreement:

>      (i) the Eurodollar Loans of such Bank shall automatically be converted to
> ABR Loans, without any requirement of compliance by the Borrowers with Section
> 3.05, 4.03 or 4.04, on (x) the last day of the outstanding Interest Period or
> Periods applicable thereto,

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> unless awaiting such date is unlawful or (y) if awaiting such date is
> unlawful, immediately upon the receipt by the applicable Borrower of such
> notice;
> 
>      (ii) the obligation of such Bank to make, convert ABR Loans into, or
> continue for an additional Interest Period, Revolving Eurodollar Loans shall
> be suspended, and, if the Borrower shall request in a Revolving Credit Loan
> Request or Conversion Request that such Bank make a Revolving Eurodollar Loan,
> the Loan requested to be made by such Bank shall instead be made as an ABR
> Loan; and
> 
>      (iii) such Bank shall not submit any Competitive Advance Bid with respect
> to Competitive Eurodollar Loans.

Such Bank shall promptly notify the Administrative Agent, which thereupon shall
promptly notify API, when such specified circumstances no longer apply.

     Section 4.06. Substitution of Banks. If any Bank (a) shall request any
compensation or indemnity under Section 4.03 or 4.04, (b) shall give any notice
described in the first sentence of Section 4.05, (c) shall become a
Non-Consenting Bank or (d) fail to perform its obligations hereunder, the
Borrowers shall have the right to require such Bank to assign all its interests,
rights and obligations under this Agreement to another Bank or financial
institution identified by the Borrowers with the assistance of the
Administrative Agent (and the Administrative Agent agrees to use its reasonable
efforts so to assist the Borrowers); provided, however, that (i) such assignment
shall not conflict with any applicable statute, law, rule, regulation, order or
decree of any Governmental Authority and (ii) the assigning Bank shall have
received from the Borrowers and/or such assignee full payment of the principal
of all then-outstanding Loans made by such Bank hereunder, together with accrued
and unpaid interest thereon, and (provided that such Bank has complied with its
obligations under Section 4.04(c)) all other amounts owed to it hereunder.

     Section 4.07. Repayment of Loans. (a) Revolving Credit Loans. Each Borrower
shall repay to the Administrative Agent for the ratable benefit of each Bank on
the Termination Date applicable to such Bank the aggregate principal amount of
the Revolving Credit Loans made by such Bank to such Borrower and then
outstanding.

     (b) Competitive Advance Loans. Each Borrower shall repay to the
Administrative Agent for the ratable benefit of each Bank that has participated
in a Competitive Advance Loan made to such Borrower on the Maturity Date of such
Competitive Advance Loan the aggregate principal amount of such Competitive
Advance Loan.

ARTICLE 5

REPRESENTATIONS AND WARRANTIES

     Section 5.01. Representations and Warranties of the Borrowers. The
Borrowers severally represent and warrant that:

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     (a) Corporate Existence and Power. Each Borrower has been duly organized
and is validly existing and, to the extent applicable, in good standing under
the laws of its jurisdiction of organization, and has all corporate powers and
all material governmental licenses, authorizations, consents and approvals
required to carry on its business as presently conducted.

     (b) Corporate and Governmental Authorization; No Contravention. The
execution, delivery and performance by each Borrower of each of the Credit
Documents to which such Borrower is a party are within the corporate powers of
such Borrower and have been duly authorized by all necessary corporate action of
such Borrower, require no action by or in respect of, or filing with, any
governmental body, agency or official and do not contravene in any material
respect, or constitute a material default under, any provision of applicable law
or regulation or of the certificate of incorporation or by-laws (or similar
constitutive instruments) of such Borrower or of any agreement, judgment,
injunction, order, decree or other instrument binding upon such Borrower or
result in the creation or imposition of any material Lien on any asset of any
Borrower or any Material Subsidiary.

     (c) Binding Effect. This Agreement constitutes a valid and binding
agreement of each Borrower, and each Note will constitute a valid and binding
obligation of the Borrower party to such Note when executed and delivered by
such Borrower in accordance with this Agreement, in each case enforceable in
accordance with their respective terms, subject to bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium or other similar laws relating
to or affecting creditors’ rights generally, and to general equity principles,
regardless of whether considered in a proceeding in equity or at law.

     (d) Financial Information. (i) The consolidated balance sheet of API and
its Consolidated Subsidiaries as of December 31, 2004 and the related
consolidated statements of income, cash flows and changes in shareholders’
equity for the fiscal year then ended, reported on by PricewaterhouseCoopers LLP
and filed with the SEC in API’s Annual Report on Form 10-K for the fiscal year
ended December 31, 2004, copies of which have been delivered to each of the
Banks, fairly present, in conformity with GAAP, the consolidated financial
position of API and its Consolidated Subsidiaries as of such date and its
consolidated income and cash flows and changes in shareholders’ equity for such
fiscal year.

     (ii) Except as publicly disclosed by API prior to the Effective Date, as of
the Effective Date, there has been no material adverse change since December 31,
2004 in the business, consolidated financial position or consolidated results of
operations of API and its Consolidated Subsidiaries, considered as a whole.

     (e) Litigation. Except as disclosed in the reports or financial statements
referred to in Section 5.01(d) or in Schedule 5.01(e), as of the Effective Date,
there is no action, suit or proceeding pending, or to the knowledge of API or
ACC threatened, against API or any Subsidiary in which there is a reasonable
possibility of an adverse decision which would be reasonably likely to
materially and adversely affect the business, consolidated financial position or
consolidated results of operations of API and its Consolidated Subsidiaries,

33

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considered as a whole or in any manner seeks to avoid the obligations of any
Borrower to repay Loans or of API under the guaranty set forth in Article 10.

     (f) Compliance with ERISA. Each member of the ERISA Group has fulfilled its
obligations under the minimum funding standards of ERISA and the Code with
respect to each Plan and is in compliance with the presently applicable
provisions of ERISA and the Code with respect to each Plan, except to the extent
that any failure so to be in compliance would not, individually or in the
aggregate, materially and adversely affect the business, consolidated financial
position or consolidated results of operations of API and its Consolidated
Subsidiaries, considered as a whole. As of the Effective Date, no member of the
ERISA Group has (i) sought a waiver of the minimum funding standard under
Section 412 of the Code in respect of any Plan, (ii) failed to make any
contribution or payment to any Plan or Multiemployer Plan or in respect of any
Benefit Arrangement, or made any amendment to any Plan or Benefit Arrangement,
which has resulted or could result in the imposition of a Lien or the posting of
a bond or other security under ERISA or the Code or (iii) incurred any liability
under Title IV of ERISA other than a liability to the PBGC for premiums under
Section 4007 of ERISA, except to the extent that any such waivers, failures and
liabilities would not, individually or in the aggregate, materially and
adversely affect the business, consolidated financial position or consolidated
results of operations of API and its Consolidated Subsidiaries, considered as a
whole.

     (g) Taxes. United States federal income tax returns of API and its domestic
Subsidiaries have been examined and closed through the fiscal year ended
December 31, 1993. API and its Subsidiaries have filed all United States Federal
income tax returns and all other material tax returns which are required to be
filed by them and have paid all material taxes due pursuant to such returns or
pursuant to any assessment received by API or any Subsidiary, except for
assessments being contested in good faith by appropriate proceedings and as to
which API or such Subsidiary has set aside adequate reserves on its books. The
charges, accruals and reserves on the books of API and its Consolidated
Subsidiaries in respect of taxes or other governmental charges are, in the
opinion of API, adequate in all material respects.

     (h) Material Subsidiaries. Each Material Subsidiary has been duly organized
and is validly existing and, to the extent applicable, in good standing under
the laws of its jurisdiction of organization, and has all corporate powers and
all governmental licenses, authorizations, consents and approvals required to
carry on its business as now conducted, except to the extent that the failure of
any of the foregoing would not, individually or in the aggregate, materially and
adversely affect the business, consolidated financial position or consolidated
results of operations of API and its Consolidated Subsidiaries, considered as a
whole.

     (i) Investment Company Act. No Borrower is an “investment company” within
the meaning of the Investment Company Act of 1940, as amended.

     (j) Disclosure. All information heretofore furnished by the Borrowers to
the Administrative Agent or any Bank in writing for purposes of or in connection
with this Agreement or any transaction contemplated hereby, taken as a whole,
was true and accurate

34

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in all material respects or based on reasonable estimates on the date as of
which such information is stated or certified and API has disclosed to the Banks
in writing (including in any materials publicly filed by API with the SEC) any
and all facts known to API which it reasonably believes materially and adversely
affect or may materially and adversely affect (to the extent API can now
reasonably foresee) the business, consolidated financial position or
consolidated results of operations of API and its Consolidated Subsidiaries,
considered as a whole.

     (k) Environmental Matters. In the ordinary course of its business, API
conducts an ongoing review of the effect of Environmental Laws on the business,
operations and properties of API and its Subsidiaries, in the course of which it
identifies and evaluates associated liabilities and costs (including, without
limitation, any capital or operating expenditures required for clean-up or
closure of properties presently or previously owned, any capital or operating
expenditures required to achieve or maintain compliance with environmental
protection standards imposed by law or as a condition of any license, permit or
contract, any related constraints on operating activities, including any
periodic or permanent shutdown of any facility or reduction in the level of or
change in the nature of operations conducted thereat and any actual or potential
liabilities to third parties, including employees, and any related costs and
expenses). On the basis of this review, API has reasonably concluded that, as of
the Effective Date, Environmental Laws are unlikely to have a material adverse
effect on the business, consolidated financial condition, or consolidated
results of operations of API and its Consolidated Subsidiaries, considered as a
whole.

     (l) Federal Reserve Regulations. After giving effect to the application of
the proceeds of each Loan, not more than 25% of the value of the consolidated
assets of API (based on book value or another reasonable measure) will consist
of or be represented by “margin stock” within the meaning of Regulation U of the
Federal Reserve Board.

ARTICLE 6

CONDITIONS PRECEDENT

     Section 6.01. Conditions to Effectiveness. This Agreement shall not become
effective until the earliest date (the “Effective Date”) on which each of the
following conditions precedent shall have been satisfied, or waived in writing
by the Banks:

     (a) Agreements. The Administrative Agent shall have received counterparts
of this Agreement, duly executed and delivered by each of the Banks, the Initial
Borrowers and the Administrative Agent (or in the case of any such party as to
which an executed counterpart shall not have been received, the Administrative
Agent shall have received, in form satisfactory to it, telegraphic, telecopy or
other written confirmation from such party of its execution of a counterpart of
this Agreement).

     (b) Evidence of Corporate Action. The Administrative Agent shall have
received the following:

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>      (i) API. (A) a copy of the Restated Certificate of Incorporation, as
> amended, of API, certified as of a recent date not later than the Effective
> Date by the Secretary of State of the State of New York, and a certificate as
> to the good standing of API as of a date not earlier than ten Domestic
> Business Days prior to the Effective Date, from such Secretary of State;
> 
>      (B) a certificate of the Secretary or Assistant Secretary of API, dated
> the Effective Date, and certifying (1) that attached thereto is a true and
> complete copy of the by-laws of API as in effect on such date and at all times
> since the date of the resolutions described in clause (2) below, (2) that
> attached thereto is a true and complete copy of resolutions duly adopted by
> the Board of Directors of API authorizing the execution, delivery and
> performance of this Agreement, and that such resolutions have not been
> modified, rescinded or amended and are in full force and effect, (3) that the
> certificate of incorporation of API has not been amended since the date of the
> last amendment thereto shown on the certificate of good standing furnished
> pursuant to clause (i)(A) above, and (4) as to the incumbency and signature of
> each officer executing this Agreement or any document delivered in connection
> herewith on behalf of the API;
> 
>      (C) a certificate of a Responsible Officer of API as to the incumbency
> and signature of the Secretary or Assistant Secretary of API executing the
> certificate described in clause (i)(B) above; and
> 
>      (D) a certificate of a Responsible Officer of API, dated the Effective
> Date, stating that (1) the representations and warranties set forth in Section
> 5.01 are correct on and as of the Effective Date and (2) no Default or Event
> of Default has occurred and is continuing.
> 
>      (ii) ACC. (A) a copy of the Certificate of Incorporation, as amended, of
> ACC, certified as of a recent date not later than the Effective Date by the
> Secretary of State of the State of Delaware, and a certificate as to the good
> standing of ACC as of a date not earlier than ten Domestic Business Days prior
> to the Effective Date, from such Secretary of State;
> 
>      (B) a certificate of the Secretary or Assistant Secretary of ACC, dated
> the Effective Date, and certifying (1) that attached thereto is a true and
> complete copy of the by-laws of ACC as in effect on such date and at all times
> since the date of the resolutions described in clause (2) below, (2) that
> attached thereto is a true and complete copy of resolutions duly adopted by
> the Board of Directors of ACC authorizing the execution, delivery and
> performance of this Agreement, and that such resolutions have not been
> modified, rescinded or amended and are in full force and effect, (3) that the
> certificate of incorporation of ACC has not been amended since the date of the
> last amendment thereto shown on the certificate of good standing furnished
> pursuant to clause (ii)(A) above, and (4) as to the incumbency and signature
> of each officer executing this Agreement or any document delivered in
> connection herewith on behalf of ACC; and

36

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>      (C) a certificate of a Responsible Officer of ACC as to the incumbency
> and signature of the Secretary or Assistant Secretary of ACC executing the
> certificate described in clause (ii)(B) above.

     (c) Legal Opinions. The Administrative Agent shall have received an opinion
of the General Counsel of API, substantially in the form of Exhibit G hereto,
and an opinion of Shearman & Sterling LLP, counsel to the Administrative Agent,
in form and substance reasonably satisfactory to the Administrative Agent.

     (d) Repayment of Outstanding Loans. The Administrative Agent shall have
received evidence, in form and substance satisfactory to it, that (i) all Loans
outstanding under the Existing Credit Agreement, and all interest and fees that
are payable thereunder, shall have been paid in full and (ii) the commitments
thereunder have been terminated.

     Section 6.02. Conditions to Each Loan. The obligations of each Bank to make
any Loan (including the initial Loans) are subject to the conditions that the
Effective Date shall have occurred and that, on the Borrowing Date of each such
Loan and after giving effect thereto, each of the following conditions precedent
shall have been satisfied, or waived in writing by the Required Banks, and upon
such satisfaction or waiver each such Bank will give a written confirmation of
the same to the relevant Borrower upon request:

     (a) Borrowing Request. The Administrative Agent shall have received from
such Borrower a Borrowing Request, in the appropriate form and in the manner
contemplated hereby.

     (b) Absence of Defaults. No Default or Event of Default shall have occurred
and be continuing.

     (c) Representations and Warranties. The representations and warranties
contained in Section 5.01 shall have been true when made and (other than the
representations and warranties contained in Sections 5.01(d)(ii) and 5.01(e) or
any other representations or warranties that expressly relate to a date certain)
shall be true and correct with the same effect as though such representations
and warranties had been made at the time of such Loan.

     (d) Additional Conditions for Loans to Additional Borrowers. In the case of
a Loan to an Additional Borrower, none of the following shall have occurred and
be continuing:

>      (i) Such Additional Borrower shall fail to make any payment in respect of
> Debt, other than Debt under this Agreement or any Notes, having an aggregate
> principal or face amount of $100,000,000 or more when due or within any
> applicable grace period;
> 
>      (ii) Any event or condition (other than those covered by clause (i)
> above) shall occur which (i) results in the acceleration of the maturity of
> Debt (other than Debt under any Credit Document) of such Additional Borrower
> having an aggregate principal amount of $100,000,000 or more or (ii) would
> presently cause or allow the

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> maturity of any Debt (other than Debt under any Credit Document) of such
> Additional Borrower having an aggregate principal amount of $100,000,000 or
> more to be accelerated;
> 
>      (iii) Such Additional Borrower shall commence a voluntary case or other
> proceeding seeking liquidation, reorganization or other relief with respect to
> itself or its 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 it or any substantial part
> of its 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 it, or shall make a general assignment for the
> benefit of creditors, or shall fail generally to pay its debts as they become
> due (or admit such failure in writing), or shall take any corporate action to
> authorize any of the foregoing;
> 
>      (iv) An involuntary case or other proceeding shall be commenced against
> such Additional Borrower seeking liquidation, reorganization or other relief
> with respect to it or its 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 it or
> any substantial part of its 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 such Additional Borrower under
> the Federal bankruptcy laws as now or hereafter in effect; or
> 
>      (v) Judgments or orders for the payment of money in excess of
> $100,000,000 in the aggregate shall be rendered against such Additional
> Borrower and such judgments or orders shall continue unsatisfied and unstayed
> for a period of more than 30 days.

     Section 6.03. Satisfaction of Conditions Precedent. Acceptance by a
Borrower of the proceeds of any Loan shall be deemed to constitute a
certification of such Borrower that, as of the relevant Borrowing Date, each of
the applicable conditions precedent in Section 6.02 has been satisfied or waived
in writing.

     Section 6.04. Additional Borrowers. In the case of the first Loans to be
made to an Additional Borrower, in addition to the conditions set forth in
Section 6.02, the obligations of each Bank to make such Loans are subject to the
condition that, on the Borrowing Date of each such Loan, each of the following
conditions precedent shall have been satisfied, or waived in writing by the
Required Banks, and upon such satisfaction or waiver each Bank will give written
confirmation of the same to the relevant Additional Borrower:

     (a) Designation and Confirmation. The Administrative Agent shall have
received an Additional Borrower Designation and an Additional Borrower
Confirmation, in substantially the forms of Exhibits E-2 and E-3, respectively,
duly executed and delivered by API and such Additional Borrower, respectively;

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     (b) Bank Consent. In the case of an Additional Borrower not listed on
Schedule 6.04, all the Banks shall have consented to the designation of that
Additional Borrower as such; and

     (c) Evidence of Corporate Action. The Administrative Agent shall have
received:

>      (i) a certificate of the Secretary or Assistant Secretary (or similar
> official) of such Additional Borrower, dated the Borrowing Date, and
> certifying (A) that attached thereto is a true and complete copy of the
> constitutive instruments of such Additional Borrower as in effect on such date
> and at all times since the date of the resolutions described in clause (B)
> below, (B) that attached thereto is a true and complete copy of resolutions
> duly adopted by the Board of Directors of such Additional Borrower authorizing
> the execution, delivery and performance of this Agreement, and that such
> resolutions have not been modified, rescinded or amended and are in full force
> and effect, and (C) as to the incumbency and signature of each officer
> executing this Agreement or any document delivered in connection herewith on
> behalf of such Additional Borrower; and
> 
>      (ii) a certificate or certificates of a Responsible Officer of such
> Additional Borrower as to the incumbency and signature of the Secretary of
> Assistant Secretary (or similar official) of such Additional Borrower
> executing the certificate described in clause (i) above.

ARTICLE 7

COVENANTS

     Section 7.01. Affirmative Covenants. API (and, in the case of Section
7.01(f), each Borrower (on and after the date on which it shall become a
Borrower)) agrees that, so long as any Bank has in effect any Commitment
hereunder or any amount payable on any Loan remains unpaid:

>      (a) Financial Information. API will deliver to the Administrative Agent:
> 
> >      (i) as soon as available and in any event within 75 days after the end
> > of each fiscal year of API, a consolidated balance sheet of API and its
> > Consolidated Subsidiaries as of the end of such fiscal year and the related
> > consolidated statements of income, cash flows and changes in shareholders’
> > equity for such fiscal year, setting forth in each case in comparative form
> > the figures for the previous fiscal year, all reported on in a manner
> > acceptable to the SEC by PricewaterhouseCoopers LLP or other independent
> > public accountants of nationally recognized standing;
> > 
> >      (ii) as soon as available and in any event within 45 days after the end
> > of each of the first three quarters of each fiscal year of API, a
> > consolidated balance sheet of API and its Consolidated Subsidiaries as of
> > the end of such quarter and the related consolidated statements of
> > operations for such quarter and the portion of the

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> > fiscal year ended at the end of such quarter and the related consolidated
> > statement of cash flows for the portion of the fiscal year ended at the end
> > of such quarter, all reported in a manner acceptable to the SEC and
> > certified as to fairness of presentation, GAAP and consistency by a
> > Responsible Officer of API;
> > 
> >      (iii) simultaneously with the delivery of each set of financial
> > statements referred to in clauses (i) and (ii) above, a certificate of a
> > Responsible Officer of API (A) setting forth in reasonable detail the
> > calculations required to establish whether API was in compliance with the
> > requirements of Section 7.02(d) on the date of such financial statements and
> > (B) stating whether any Default or Event of Default exists on the date of
> > such certificate and, if any Default or Event of Default then exists,
> > setting forth the details thereof and the action which API is taking or
> > proposes to take with respect thereto;
> > 
> >      (iv) simultaneously with the delivery of each set of financial
> > statements referred to in clause (i) above, a statement of the firm of
> > independent public accountants which reported on such statements (A) whether
> > anything has come to their attention to cause them to believe that any
> > Default or Event of Default existed on the date of such statements and (B)
> > confirming the calculations set forth in the officer’s certificate delivered
> > simultaneously therewith pursuant to clause (iii) above;
> > 
> >      (v) within five days of any Responsible Officer of the Borrower or API
> > obtaining knowledge of any Default or Event of Default, if such Default or
> > Event of Default is then continuing, a certificate of a Responsible Officer
> > of API stating that such certificate is a “Notice of Default” and setting
> > forth the details thereof and the action which API is taking or proposes to
> > take with respect thereto;
> > 
> >      (vi) promptly upon the mailing thereof to the shareholders of API
> > generally, copies of all financial statements, reports and proxy statements
> > so mailed;
> > 
> >      (vii) 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 reports on Forms 10-K, 10-Q and 8-K (or
> > their equivalents) which API or the Borrower shall have filed with the SEC;
> > 
> >      (viii) if and when any member of the ERISA Group (A) 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, (B) receives notice of
> > complete or partial withdrawal liability under Title IV of ERISA or notice
> > that any Multiemployer Plan is in reorganization, is insolvent or has been
> > terminated, a copy of such notice, (C) receives notice from the PBGC under
> > Title IV of ERISA of an intent to terminate, impose liability (other than
> > for premiums under Section 4007 of ERISA) in respect of, or appoint a
> > trustee

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> > to administer any Plan, a copy of such notice, (D) applies for a waiver of
> > the minimum funding standard under Section 412 of the Code, a copy of such
> > application, (E) gives notice of intent to terminate any Plan under Section
> > 4041(c) of ERISA, a copy of such notice and other information filed with the
> > PBGC, (F) gives notice of withdrawal from any Plan pursuant to Section 4063
> > of ERISA, a copy of such notice, or (G) fails to make any payment or
> > contribution to any Plan or Multiemployer Plan or in respect of any Benefit
> > Arrangement or makes any amendment to any Plan or Benefit Arrangement which
> > has resulted or could result in the imposition of a Lien or the posting of a
> > bond or other security under ERISA or the Code, a certificate of the
> > Treasurer or chief financial officer of API setting forth details as to such
> > occurrence and action, if any, which API or the applicable member of the
> > ERISA Group is required or proposes to take; and
> > 
> >      (ix) from time to time, such additional information regarding the
> > financial position or business of the Borrowers (including notification of
> > any change in the ratings assigned to API by S&P or Moody’s) as the
> > Administrative Agent, at the request of any Bank, may reasonably request.
> 
>      (b) Maintenance of Property; Insurance. (i) API will keep, and will cause
> each Material Subsidiary to keep, all material property useful and necessary
> in its business in substantial good working order and condition, ordinary wear
> and tear excepted.
> 
>      (ii) API will, and will cause each Material Subsidiary to, maintain
> (either in the name of API or in such Material Subsidiary’s own name) with
> financially sound and responsible insurance companies, insurance on all their
> respective properties in at least such amounts and against at least such risks
> (and with such risk retention) as are usually insured against in the same
> general area by companies of established repute engaged in the same or a
> similar business; and will furnish to the Banks, upon request from the
> Administrative Agent, information presented in reasonable detail as to the
> insurance so carried.
> 
>      (c) Continuation of Business. API and its Subsidiaries will continue to
> engage in business of the same general type as conducted by API and its
> Subsidiaries on the date hereof, considered as a whole. Except as permitted
> under Section 7.02(a), API will preserve, renew and keep in full force and
> effect, and will cause each Material Subsidiary to preserve, renew and keep in
> full force and effect their respective corporate existence and their
> respective rights, privileges and franchises necessary or desirable in the
> normal conduct of business.
> 
>      (d) Compliance with Law. API will comply, and cause each Subsidiary to
> comply, with all applicable laws, ordinances, rules, regulations, and
> requirements of governmental authorities (including, without limitation,
> Environmental Laws, ERISA and the rules and regulations thereunder) except (i)
> where the necessity of compliance therewith is contested in good faith by
> appropriate proceedings or (ii) where failure so to comply would not have a
> material adverse effect on the business, consolidated financial position or
> consolidated results of operations of API and its Consolidated Subsidiaries,
> considered as a whole.

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>      (e) Books, Records and Inspection. API will 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 (as applied to API and its
> Consolidated Subsidiaries on a consolidated basis) shall be made of all
> dealings and transactions in relation to its business and activities; and will
> permit, and will cause each Subsidiary to permit, representatives of any Bank
> at such Bank’s expense to visit and inspect any of its properties, to examine
> and make abstracts from any of its books and records and to discuss its
> affairs, finances and accounts with its officers, employees and independent
> public accountants, all at such reasonable times and as often as may
> reasonably be desired.
> 
>      (f) Use of Proceeds. The proceeds of each Loan (i) will be used by the
> relevant Borrower for the purposes described in Section 2.08 and (ii) will not
> be used by such Borrower in violation of any applicable law or regulation,
> including Regulation U and Regulation X of the Federal Reserve Board.

     Section 7.02. Negative Covenants. API agrees that, so long as any Bank has
any Commitment hereunder or any Loan remains unpaid:

>      (a) Mergers, Consolidations and Sales of Assets. API will not, and, so
> long as any Loans made to ACC are outstanding hereunder, will not permit ACC
> to, consolidate with or merge with or into any other person or sell, convey or
> otherwise transfer its properties or assets substantially as an entirety to
> any Person or Persons, except that (i) API may merge with a person that is a
> U.S. corporation, so long as API is the corporation surviving such merger and
> no Default or Event of Default shall have occurred or be continuing
> immediately after such merger and (ii) ACC may consolidate with or merge with
> or into API or any Wholly-Owned Subsidiary.
> 
>      (b) Negative Pledge. API will not, and will not permit any Subsidiary to,
> create, assume or suffer to exist any Lien on any asset (including, without
> limitation, any stock of any Material Subsidiary) now owned or hereafter
> acquired by it, except:
> 
> >      (i) Liens existing on the date hereof securing obligations not
> > exceeding $26,000,000 in aggregate amount;
> > 
> >      (ii) Liens arising in the ordinary course of its business which (A) do
> > not secure Debt and (B) do not in the aggregate materially detract from the
> > value of its assets or materially impair the use thereof in the operation of
> > its business;
> > 
> >      (iii) any Lien on any assets securing Debt incurred or assumed for the
> > purpose of financing all or any part of the cost of acquiring such asset,
> > provided that such Lien attaches to such asset concurrently with or within
> > 90 days after the acquisition thereof;
> > 
> >      (iv) any Lien arising out of the refinancing, extension, renewal or
> > refunding of any Debt secured by any Lien permitted by any of the foregoing
> > clauses of this Section 7.02(b), provided that such Debt is not increased
> > and is not secured by any additional assets;

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> >      (v) any Lien existing on any asset prior to the acquisition thereof by
> > API or a Consolidated Subsidiary and not created in contemplation of such
> > acquisition;
> > 
> >      (vi) Liens for taxes or assessments and similar charges either (A) not
> > delinquent or (B) being contested in good faith by appropriate proceedings
> > and as to which adequate reserves have been set aside on the books of API
> > and its Subsidiaries;
> > 
> >      (vii) Liens arising out of judgments or awards against API or any
> > Consolidated Subsidiary with respect to which API or such Consolidated
> > Subsidiary shall in good faith be prosecuting an appeal or proceedings for
> > review, provided that (A) API or such Consolidated Subsidiary, as the case
> > may be, shall have secured, within 60 days after the creation thereof, an
> > effective stay of execution pending such appeal or review, and (B) except
> > with respect to judgments and awards with respect to non-United States taxes
> > against Consolidated Subsidiaries organized or conducting a substantial
> > portion of their business outside the United States, the aggregate amount of
> > such judgments and awards shall not exceed $200,000,000;
> > 
> >      (viii) Liens for minor survey exceptions, or minor encumbrances,
> > easements or reservations of, or rights of others for, rights of way,
> > sewers, electric lines, telegraph and telephone lines and other similar
> > purposes, or zoning or other restrictions as to the use of real properties,
> > which encumbrances, easements, reservations, rights and restrictions do not
> > in the aggregate materially detract from the value of the real properties of
> > API and the Consolidated Subsidiaries, considered as a whole, or materially
> > impair their use in the operation of the business of API or the Consolidated
> > Subsidiary owning the same;
> > 
> >      (ix) Liens of Consolidated Subsidiaries securing Debt of such
> > Consolidated Subsidiaries to API;
> > 
> >      (x) Liens in favor of the Administrative Agent or the Banks securing
> > obligations and liabilities of the Borrowers hereunder; and
> > 
> >      (xi) any other Liens incurred in the ordinary course of business,
> > provided that the aggregate amount of all such other Liens incurred in the
> > ordinary course of business shall not exceed $75,000,000 at any time
> > outstanding.
> 
>      (c) Ownership of Other Borrowers. API will at no time at which any Loans
> made to (i) ACC are outstanding hereunder own less than 100% of each
> outstanding class of capital stock of ACC or (ii) any Additional Borrower are
> outstanding hereunder, permit such Additional Borrower to cease to be a
> Subsidiary.
> 
>      (d) Interest Coverage Ratio. As of the last day of each fiscal quarter of
> API, the Interest Coverage Ratio will not be less than 4:1.

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ARTICLE 8

EVENTS OF DEFAULT

     Section 8.01. Events of Default. If one or more of the following events
(each, an “Event of Default”) shall have occurred and be continuing:

>      (a) A Borrower shall fail to pay when due any principal of any Loan or
> shall fail to pay within five Business Days after the date when due any
> interest, fee or other amount payable hereunder;
> 
>      (b) API shall fail to observe or perform any of its covenants contained
> in Section 7.01(a)(v) or Section 7.02;
> 
>      (c) A Borrower shall fail to observe or perform any of its covenants or
> agreements contained in this Agreement (other than those covered by clause (a)
> or (b) above) for 30 days after written notice thereof has been given to API
> by the Administrative Agent at the request of any Bank;
> 
>      (d) Any representation, warranty, certification or statement made by a
> Borrower in this Agreement or in any certificate, financial statement or other
> document delivered pursuant hereto shall prove to have been incorrect in any
> material respect when made or deemed made (it being understood that good faith
> projections that are reasonable when made shall not be considered
> representations, warranties, certifications or statements for purposes of this
> Section 8.01(d));
> 
>      (e) API, ACC, or any Material Subsidiary shall fail to make any payment
> in respect of Debt, other than Debt under this Agreement or any Notes, having
> an aggregate principal or face amount of $100,000,000 or more when due or
> within any applicable grace period;
> 
>      (f) Any event or condition (other than those covered by clause (e) above)
> shall occur which (i) results in the acceleration of the maturity of Debt
> (other than Debt under any Credit Document) of API or any Material Subsidiary
> having an aggregate principal amount of $100,000,000 or more or (ii) would
> presently cause or allow the maturity of any Debt (other than Debt under any
> Credit Document) of API or any Material Subsidiary having an aggregate
> principal amount of $100,000,000 or more to be accelerated;
> 
>      (g) API, ACC, or any Material Subsidiary shall commence a voluntary case
> or other proceeding seeking liquidation, reorganization or other relief with
> respect to itself or its 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 it or
> any substantial part of its 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 it, or shall make a
> general assignment for the benefit of creditors, or shall fail generally to
> pay its debts as they become due (or admit such failure in writing), or shall
> take any corporate action to authorize any of the foregoing;

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>      (h) An involuntary case or other proceeding shall be commenced against
> API or any Material Subsidiary seeking liquidation, reorganization or other
> relief with respect to it or its 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 it or
> any substantial part of its 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 API or any Material Subsidiary
> under the Federal bankruptcy laws as now or hereafter in effect;
> 
>      (i) Any member of the ERISA Group shall fail to pay when due an amount or
> amounts aggregating in excess of $100,000,000 which it shall have become
> liable to pay under Title IV of ERISA; or notice of intent to terminate a
> Material Plan shall be filed under Title IV of ERISA by any member of the
> ERISA Group, any plan administrator or any combination of the foregoing; or
> the PBGC shall institute proceedings under Title IV of ERISA to terminate, to
> impose liability (other than for premiums under Section 4007 of ERISA) in
> respect of, or to cause a trustee to be appointed to administer any Material
> Plan; or a condition specified in Section 4042(a)(1) of ERISA, shall exist by
> reason of which the PBGC would be entitled to obtain a decree adjudicating
> that any Material Plan must be terminated; or there shall occur a complete or
> partial withdrawal from, or a default, within the meaning of Section
> 4219(c)(5) of ERISA, with respect to, one or more Multiemployer Plans which
> could cause one or more members of the ERISA Group to incur a current payment
> obligation in excess of $100,000,000;
> 
>      (j) Judgments or orders for the payment of money in excess of
> $100,000,000 in the aggregate shall be rendered against API or any Material
> Subsidiary and such judgments or orders shall continue unsatisfied and
> unstayed for a period of more than 30 days; or
> 
>      (k) A Change of Control of API;

then, and in every such event, the Administrative Agent shall (i) if requested
by the Required Banks, by notice to the Borrowers, terminate the Commitments and
they shall thereupon terminate, and (ii) if requested by the Required Banks, by
notice to the Borrowers, declare the Loans and any Notes (together with accrued
interest thereon) to be, and such Notes 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 in the case of
any of the Events of Default specified in clause (g) or (h) above, without any
notice to the Borrowers or any other act by the Administrative Agent or the
Banks, the Commitments shall thereupon terminate and the Loans and any Notes
(together with accrued interest thereon) shall become immediately due and
payable without presentment, demand, protest or other notice of any kind, all of
which are hereby waived by the Borrowers.

     Section 8.02. Notice of Default. The Administrative Agent shall give
written notice to the Borrowers of the occurrence of any Event of Default under
Section 8.01(c) promptly upon being requested to do so by any Bank and shall
thereupon notify all the Banks thereof.

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ARTICLE 9

THE ADMINISTRATIVE AGENT AND THE BANKS

     Section 9.01. The Agency. Each Bank appoints Citibank, N.A. as its
Administrative Agent hereunder and irrevocably authorizes Citibank, N.A. to take
such action on its behalf and to exercise such powers hereunder as are
specifically delegated to the Administrative Agent by the terms hereof, together
with such powers as are reasonably incidental hereto, including the exercise by
the Administrative Agent of powers delegated to the Administrative Agent and the
Banks hereby, and Citibank, N.A. hereby accepts such appointment subject to the
terms hereof. The relationship between the Administrative Agent and the Banks
shall be that of agent and principal only and nothing herein shall be construed
to constitute the Administrative Agent a trustee for any Bank nor to impose on
the Administrative Agent duties or obligations other than those expressly
provided for herein.

     Section 9.02. The Administrative Agent’s Duties. The Administrative Agent
shall promptly forward to each Bank copies, or notify each Bank as to the
contents, of all notices and other communications received from a Borrower
pursuant to the Credit Documents. As to any other matter not expressly provided
for herein or therein, the Administrative Agent shall have no duty to act or
refrain from acting with respect to a Borrower, except upon the written
instructions of the Required Banks. The Administrative Agent may deem and treat
the payee of any Note as the owner thereof for all purposes hereof until it
shall have received from the payee of such Note written notice of the transfer
thereof. The Administrative Agent shall in all cases be fully protected in
acting, or refraining from acting, in accordance with written instructions
signed by the Required Banks and, except as otherwise specifically provided for
herein, such instructions and any action or inaction pursuant thereto shall be
binding upon all the Banks and each subsequent holder of any Loan. The
Administrative Agent shall not be bound by any waiver, amendment, supplement, or
modification of any Credit Document which affects its duties as Administrative
Agent, unless it shall have given its prior written consent thereto. The
Administrative Agent shall have no duty to ascertain or inquire as to the
performance or observance of any of the terms, conditions, covenants or
agreements binding upon a Borrower pursuant to any Credit Document, nor shall it
be deemed to have knowledge of the occurrence of any Default or Event of
Default, unless it shall have received written notice from a Borrower or a Bank
specifying such Default or Event of Default and stating that such notice is a
“Notice of Default”.

     Section 9.03. Sharing of Payments and Expenses. All funds for the account
of the Banks received by the Administrative Agent in respect of payments made by
a Borrower pursuant to, or from any Person on account of, any Credit Document
shall be distributed forthwith by the Administrative Agent among the Banks,
ratably in proportion to their respective interests therein. In the event that
any Bank shall receive from a Borrower or any other source any payment of, on
account of, or for or under any Credit Document (whether received pursuant to
the exercise of any right of set-off, banker’s lien, realization upon any
security held for or appropriated to such obligation or otherwise as permitted
by law) other than in proportion to its Pro Rata Share, except for amounts
payable to such Bank under Section 4.03, 4.04, 4.06 or 4.07 hereof, then such
Bank shall purchase at par from each other Bank so much of its interest in
obligations of the Borrowers as shall be necessary in order that each Bank shall
share such payment with each of the other Banks in proportion to each Bank’s Pro
Rata Share. In the event that any purchasing Bank shall be

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required to return any excess payment received by it, the purchase shall be
rescinded and the purchase price restored to the extent of such return, but
without interest.

     Section 9.04. The Administrative Agent’s Liabilities. Each of the Banks and
the Borrowers agrees that (a) neither the Administrative Agent in such capacity
nor any of its officers or employees shall be liable for any action taken or
omitted to be taken by any of them hereunder except for its or their own gross
negligence or willful misconduct, (b) neither the Administrative Agent in such
capacity nor any of its officers or employees shall be liable for any action
taken or omitted to be taken by any of them in good faith in reliance upon the
advice of counsel, independent public accountants or other experts selected by
the Administrative Agent and (c) the Administrative Agent in such capacity shall
be entitled to rely upon any notice (telephonic or written), consent,
certificate, statement or other document (including any telegram, cable, telex,
facsimile or telephone transmission) believed by it to be genuine and correct
and to have been given, signed and/or sent by the proper Persons.

     Section 9.05. The Administrative Agent as a Bank. The Administrative Agent
shall have the same rights and powers hereunder as any other Bank and may
exercise the same as though it were not an Administrative Agent, and the terms
“Bank” or “Banks”, unless the context otherwise indicated, include the
Administrative Agent in its individual capacity. The Administrative Agent may
maintain deposits or credit balances for, invest in, lend money to and generally
engage in any kind of banking business with API or any Subsidiary or affiliate
of API as if it were any other Bank and without any duty to account therefor to
the other Banks.

     Section 9.06. Bank Credit Decision. Neither the Administrative Agent nor
any of its officers or employees has any responsibility for, gives any guaranty
in respect of, nor makes any representation to the Banks as to, (a) the
condition, financial or otherwise, of API or any Subsidiary thereof or the truth
of any representation or warranty given or made in, or in connection with, any
Credit Document or (b) the validity, execution, sufficiency, effectiveness,
construction, adequacy, enforceability or value of any Credit Document or any
related document or instrument. Except as specifically provided herein and in
the other Credit Documents to which the Administrative Agent is a party, the
Administrative Agent shall have no duty or responsibility, either initially or
on a continuing basis, to provide any Bank with any credit or other information
with respect to the operations, business, property, condition or
creditworthiness of the Borrowers, whether such information comes into the
Administrative Agent’s possession on or before the date hereof or at any time
thereafter. Each Bank acknowledges that it has, independently and without
reliance upon the Administrative Agent or any other Bank, and based upon such
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement and any other Credit
Documents to which it may become a party. Each Bank also acknowledges that it
will, independently and without reliance upon the Administrative Agent or any
other Bank, and based upon such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under any Credit Document.

     Section 9.07. Indemnification. Each Bank agrees (which agreement shall
survive repayment of the Loans) to indemnify the Administrative Agent, to the
extent not reimbursed by the Borrowers, ratably in accordance with its
respective Commitment in effect on the date on which indemnification is sought
(or, if indemnification is sought after the date upon which the Commitment shall
have terminated and the Loans shall have been paid in full, ratably in

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accordance with its respective Commitment immediately prior to such date), from
and against any and all liabilities, obligations, losses, claims, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever which may be imposed on, incurred by, or asserted
against the Administrative Agent in any way relating to or arising out of any
Credit Document, or any action taken or omitted to be taken by the
Administrative Agent under any Credit Document; provided that no Bank 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 the Administrative Agent or
any of its officers or employees. Without limiting the foregoing, each Bank
agrees to reimburse the Administrative Agent promptly upon demand for its Pro
Rata Share of any out-of-pocket expenses (including counsel fees) incurred by
the Administrative Agent in such capacity in connection with the enforcement of,
or legal advice in respect of rights or responsibilities under, any Credit
Document or any amendments or supplements hereto or thereto, to the extent that
the Administrative Agent is not reimbursed for such expenses by the Borrowers.

     Section 9.08. Successor Administrative Agent. The Administrative Agent may
resign at any time by giving written notice thereof to the Banks and API, and
the Administrative Agent may be removed at any time by the Required Banks by
giving written notice thereof to the Administrative Agent, the other Banks and
API at least 10 Business Days prior to the effective date of such removal. Upon
any such resignation or removal, the Required Banks, with the prior written
consent of API (which consent shall not be unreasonably withheld), shall have
the right to appoint a successor Administrative Agent which shall be a
commercial bank organized under the laws of the United States of America or any
State thereof and having a capital and surplus of at least $250,000,000 (a
“Qualified Administrative Agent”). If no such successor Administrative Agent
shall have been so appointed and shall have accepted such appointment within 30
days after the resigning Administrative Agent’s giving of notice of resignation,
or the Required Banks’ giving notice of removal, as the case may be, the
resigning or removed Administrative Agent may, on behalf of the Banks, appoint a
successor Administrative Agent, which shall be a Qualified Administrative Agent
as set forth in this Section 9.08. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative Agent, such
successor Administrative Agent shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the resigned or removed
Administrative Agent, and the resigned or removed Administrative Agent shall be
discharged from its duties and obligations in such capacity under this Agreement
and any other Credit Documents. After any Administrative Agent’s resignation or
removal hereunder as Administrative Agent, the provisions of this Article 9
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Administrative Agent under this Agreement.

ARTICLE 10

THE GUARANTY

     Section 10.01. The Guaranty. API unconditionally and irrevocably guarantees
the prompt payment when due of all present and future obligations and
liabilities of all kinds (including post-petition interest, whether or not such
interest constitutes an allowed claim in the related bankruptcy or insolvency
proceeding) of each other Borrower to the Banks under any Credit

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Document, whether incurred by such Borrower as maker, endorser, drawer,
acceptor, guarantor, accommodation party or otherwise, and whether due or to
become due, secured or unsecured, absolute or contingent, joint or several, and
howsoever or whenever incurred by such Borrower (the “Guaranteed Obligations”).

     Section 10.02. Absolute Guaranty. API’s obligations hereunder shall not be
affected by (a) the genuineness, validity, regularity or enforceability of the
Guaranteed Obligations or any instrument evidencing the Guaranteed Obligations
(b) the existence, legality, validity, enforceability (including as a result of
a bankruptcy, reorganization or similar proceeding), perfection, or extent of
any collateral therefor, (c) any change in the corporate existence or structure
of any other Borrower, (d) any claims or set-offs that API may have, (e) any
law, regulation, decree or order of any jurisdiction or any event affecting any
term of the Guaranteed Obligations or the rights of any Bank with respect
thereto or (f) any other circumstance relating to the Guaranteed Obligations or
the Borrowers (other than API) which might otherwise constitute a defense
available to any surety or guarantor or to this Guaranty. The Banks make no
representation or warranty in respect of any such circumstance and have no duty
or responsibility whatsoever to API with respect to the management or
maintenance of the Guaranteed Obligations or any collateral therefor. The Banks
shall not be obligated to file any claim relating to the Guaranteed Obligations
in the event that a Borrower becomes subject to a bankruptcy, reorganization or
similar proceeding, and the failure of the Banks so to file shall not affect
API’s obligations hereunder. In the event that any payment to the Banks in
respect of any Guaranteed Obligation is rescinded or must otherwise be returned
for any reason whatsoever, API shall remain liable hereunder in respect of such
Guaranteed Obligation as if such payment had not been made.

     Section 10.03. Consents, Waivers and Renewals. API agrees that the Banks
may at any time and from time to time, either before or after the maturity
thereof, without notice to or further consent of API, extend the time of payment
of, exchange or surrender any collateral for, or renew any Guaranteed
Obligations, and may also make any agreement with ACC, an Additional Borrower or
with any other party to or person liable on any Guaranteed Obligations, or
interested therein, for the extension, renewal, payment, compromise, discharge
or release thereof, in whole or in part, or for any modification of the terms
thereof or of any agreement between the Banks, ACC, an Additional Borrower or
any such other party or person, without in any way impairing or affecting this
Guaranty. API agrees that the Banks may resort to API for payment of any
Guaranteed Obligations, whether or not the Banks shall have resorted to any
collateral security, or shall have proceeded against any Borrower or other
obligor principally or secondarily obligated with respect to any of the
Guaranteed Obligations.

     Section 10.04. Subrogation. API will not exercise any rights which it may
acquire by way of subrogation or by any indemnity, reimbursement or other
agreement, and shall not exercise any right of recourse to any assets or
property of any other Borrower held for the payment and performance of the
Guaranteed Obligations, unless and until all of the Guaranteed Obligations have
been paid in full and all Commitments have been terminated. If any amount shall
be paid to API in violation of the preceding sentence, such amount shall be held
in trust for the benefit of the Banks and shall forthwith be paid to the
Administrative Agent to be credited and applied to the Guaranteed Obligations,
whether matured or unmatured.

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     Section 10.05. Security. Without limiting any other right of each Bank,
upon the occurrence of an Event of Default that is continuing, to the fullest
extent permitted by law, whenever any of the Guaranteed Obligations shall become
due (whether by acceleration or otherwise), such Bank at its sole election may
set off against the Guaranteed Obligations due to such Bank all moneys then
standing to the credit of API on the books of such Bank. Any Bank exercising its
rights under this Section 10.05 shall give notice thereof to API, the relevant
Borrower and the Administrative Agent concurrently with or prior to the exercise
of such rights, provided that the failure to give such notice shall not affect
the validity of such set-off and application.

     Section 10.06. Continuing Guaranty. API’s obligations hereunder shall
remain in full force and effect until the principal of and interest on the Loans
and all other amounts payable by any other Borrower under this Agreement shall
have been paid in full. If at any time any payment of the principal of or
interest on the Loans or any other amount payable by any such Borrower under
this Agreement is rescinded or must otherwise be restored or returned upon the
insolvency, bankruptcy or reorganization of such Borrower or otherwise, API’s
obligations hereunder with respect to such payment shall be reinstated as though
such payment had been due but not made at such time.

     Section 10.07. Waiver of Notice. API waives notice of the acceptance of
this Guaranty and of the making of any loans or extensions of credit to any
other Borrower, presentment to or demand or payment from anyone whomsoever
liable upon any of the Guaranteed Obligations, presentment, demand, notice of
dishonor, protest, notice of any sale of collateral security and all other
notices whatsoever.

ARTICLE 11

MISCELLANEOUS

     Section 11.01. Applicable Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

     Section 11.02. Set-off. Each Bank is hereby authorized at any time and from
time to time upon the occurrence of an Event of Default that is continuing, to
the fullest extent permitted by law, to set-off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held and
other Debt at any time owing by such Bank to or for the credit or the account of
a Borrower against any and all payment obligations of such Borrower under this
Agreement then due to such Bank, irrespective of whether such Bank shall have
made any demand under this Agreement. The rights of each Bank under this Section
11.02 are in addition to any other rights and remedies (including other rights
of set-off) which such Bank may have. Any Bank exercising its rights under this
Section 11.02 shall give notice thereof to API, the relevant Borrower and the
Administrative Agent concurrently with or prior to the exercise of such rights,
provided that the failure to give such notice shall not affect the validity of
such set-off and application.

     Section 11.03. Expenses. API agrees to pay all reasonable out-of-pocket
expenses incurred by the Administrative Agent and any Banks, including the
reasonable fees and

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disbursements of one firm of counsel (plus one firm of local counsel in any
relevant jurisdiction to the extent necessary or appropriate in connection with
any proceeding relating to enforcement) chosen from time to time to represent
the Banks as a group in connection with the negotiation and execution of the
Credit Documents and, if necessary, in connection with the administration and
enforcement of any provisions of the Credit Documents.

     Section 11.04. Amendments. Any provision of this Agreement may be amended,
modified, supplemented or waived if, but only if, such amendment, modification,
supplement or waiver is in writing and is signed by each of the Borrowers and
the Required Banks (and, if the rights or duties of the Administrative Agent are
affected thereby, by the Administrative Agent); provided that no such amendment,
modification, supplement or waiver shall, unless signed by all the Banks, (i)
subject to Section 2.04 and 2.09, increase or decrease the Commitment of any
Bank or subject any Bank to any additional obligation, (ii) reduce the principal
of or rate of interest on any Loan or any fees hereunder, (iii) postpone the
date fixed for any payment of principal of or interest on any Loan or any fees
hereunder or for any reduction or termination of any Commitment, (iv) release
API from any obligations under Article 10 or (v) amend or waive the provisions
of this Section 11.04, the definition of “Required Banks” or any provision that
explicitly requires the consent of all the Banks.

     Section 11.05. Cumulative Rights and No Waiver. Each and every right
granted to the Administrative Agent and the Banks under any Credit Document, or
allowed them by law or equity, shall be cumulative and may be exercised from
time to time. No failure on the part of the Administrative Agent or any Bank to
exercise, and no delay in exercising, any right will operate as a waiver
thereof, nor will any single or partial exercise by the Administrative Agent or
any Bank of any right preclude any other or future exercise thereof or the
exercise of any other right.

     Section 11.06. Notices. (a) Except as specified in Articles 1, 2 or 3 or
subsection (b) below, any communication, demand or notice to be given hereunder
will be duly given when delivered in writing or by telecopy to a party at its
address as indicated below.

     A communication, demand or notice given pursuant to this Section 11.06
shall be addressed:

     If to any Borrower, to such Borrower at (or in care of):

> > Avon Products, Inc.
> > 1345 Avenue of the Americas
> > New York, New York 10105-0196
> > Telephone: (212) 282-5114
> > Telecopy: (212) 282-6116
> > Attention: Mr. Dennis Ling
> >                 Senior Vice President, Global Finance and Treasurer

     If to the Administrative Agent, to it at:

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

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> > Telephone: 302-894-6011
> > Telecopy: 212-994-0961
> > Attention: Bank Loan Syndications

provided, that notices to be given pursuant to Articles 2, 3 or 4 (other than
notices pursuant to Section 2.07, which shall be directed as set forth in
Exhibit C-1) hereunder shall be given to the Administrative Agent at;

> > Citibank, N.A.
> > Two Penns Way
> > New Castle, Delaware 19720
> > Telephone: 302-894-6011
> > Telecopy: 212-994-0961
> > Attention: Bank Loan Syndications

     If to any Bank, to it at the address designated as its address for notices
on Schedule 2.01.

     Unless otherwise provided herein, any notice which is required to be given
in writing or by telephone pursuant to the terms of this Agreement may be given
by telecopy or facsimile transmission. Any party from time to time may change
its address for notices by notice to the other Banks, the Agent and the Borrower
in the manner provided in this subsection.

     Each notice delivered in writing to API hereunder shall be deemed delivered
to all the Borrowers.

     (b) Subject to subsection (d) below, so long as Citibank or any of its
affiliates is the Administrative Agent, materials required to be delivered
pursuant to Section 7.01(a)(i), (ii), (vi) and (vii) shall be delivered to the
Administrative Agent in an electronic medium in a format reasonably acceptable
to the Administrative Agent and the Banks by e-mail at
oploanswebadmin@citigroup.com. API agrees that the Administrative Agent may make
such materials, as well as any other written information, documents, instruments
and other material relating to this Agreement, the Notes or any of the
transactions contemplated hereby (collectively, the “Communications”) available
to the Banks by posting such notices on Intralinks or a substantially similar
electronic system (the “Platform”). API acknowledges that (i) the distribution
of material through an electronic medium is not necessarily secure and that
there are confidentiality and other risks associated with such distribution,
(ii) the Platform is provided “as is” and “as available” and (iii) neither the
Administrative Agent nor any of its Affiliates warrants the accuracy, adequacy
or completeness of the Communications or the Platform and each expressly
disclaims liability for errors or omissions in the Communications or the
Platform. To the fullest extent permitted under applicable law, API agrees that
no warranty of any kind, express, implied or statutory, including, without
limitation, any warranty of merchantability, fitness for a particular purpose,
non-infringement of third party rights or freedom from viruses or other code
defects, is made by the Administrative Agent or any of its Affiliates in
connection with the Platform.

     (c) Each Bank agrees that notice to it (as provided in the next sentence)
(a “Notice”) specifying that any Communications have been posted to the Platform
shall constitute

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effective delivery of such information, documents or other materials to such
Bank for purposes of this Agreement; provided that if requested by any Bank the
Administrative Agent shall deliver a copy of the Communications to such Bank by
email or telecopier. Each Bank agrees (i) to notify the Administrative Agent in
writing of such Bank’s e-mail address to which a Notice may be sent by
electronic transmission (including by electronic communication) on or before the
date such Bank becomes a party to this Agreement (and from time to time
thereafter to ensure that the Administrative Agent has on record an effective
e-mail address for such Bank) and (ii) that any Notice may be sent to such
e-mail address.

     (d) For purposes of Section 7.01(vii), API shall be deemed to have
effectively delivered any report on Form 8-K to the Administrative Agent and the
Lenders when such report is posted on the Internet at the SEC’s website at
www.sec.gov.

     Section 11.07. Severability. If any one or more of the provisions contained
in this Agreement shall be invalid, illegal or unenforceable in any respect
under any law, the validity, legality and enforceability of the remaining
provisions contained herein shall not in any way be affected or impaired
thereby.

     Section 11.08. Parties in Interest. (a) Successors and Assigns. This
Agreement shall be binding upon and inure to the benefit of each of the
Borrowers and the Banks and their respective successors. Except as permitted in
Section 11.08(c), no interest in the Commitment of any Bank or any Loan, nor any
right of a Bank under the Credit Documents, may be assigned to any Person that
was not, prior to such assignment, a Bank hereunder. No Borrower shall assign or
delegate any of its respective rights or obligations hereunder, without the
prior written consent of all the Banks. Any purported assignment in
contravention of this Section 11.08 shall be null and void.

     (b) Participations. Any Bank, in the ordinary course of its business and in
accordance with applicable law, may at any time grant to one or more banks or
other financial institutions (each, a “Participant”) participating interests in
its Commitment or any or all of its Revolving Credit Loans; provided that such
Bank gives written notice of the granting of such participation to API. In the
event of any such grant by a Bank of a participating interest to a Participant,
whether or not upon notice to either Borrower and the Administrative Agent, such
Bank shall remain responsible for the performance of its obligations hereunder
and the Borrowers and the Administrative Agent shall continue to deal solely and
directly with such Bank in connection with such Bank’s rights and obligations
under this Agreement. Any agreement pursuant to which any Bank may grant such a
participating interest shall provide that such Bank shall retain the sole right
and responsibility to enforce the obligations of the Borrowers under the Credit
Documents, including the right to approve any amendment, modification,
supplement or waiver of any provision of this Agreement; provided that such
participation agreement may provide that such Bank will not agree to any
modification, amendment or waiver of this Agreement described in Sections
11.04(i) through (v), inclusive, without the consent of the Participant. Each
Borrower agrees that each Participant shall be entitled to the benefits of
Sections 4.03 and 4.04 with respect to its participating interest; provided that
(i) all amounts payable to a Bank for the account of a Participant under
Sections 4.03 and 4.04 shall be determined as if such Bank had not granted such
participation to the Participant and (ii) no Participant shall be entitled to
receive any greater payment under Section 4.03 or 4.04 than such Bank would have
been entitled to receive

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with respect to the rights participated, unless such transfer is made with API’s
prior written consent or by reason of the provisions of Section 4.04 requiring
such Bank to designate a different lending office under certain circumstances or
at a time when the circumstances giving rise to such payment did not exist.

     (c) Assignments. (i) Any Bank, in accordance with applicable law, may
assign all or a portion of its interests, rights and obligations under this
Agreement (including a portion or all of its Commitment or of the Loans at the
time owing to it) to one or more banks or other financial institutions (each, an
“Assignee”); provided, however, that (A) each of API and the Administrative
Agent must give its prior written consent (which consent shall not be
unreasonably withheld) to any such assignment (other than an assignment by a
Bank to an affiliate of such Bank or to a Federal Reserve Bank), (B) the amount
of the Commitment of the assigning Bank (determined as of the date of such
assignment) subject to such assignment (other than in the case of an assignment
to an Affiliate of the Bank or a Federal Reserve Bank) shall not be less than
$10,000,000, unless API otherwise consents (which consent shall not be
unreasonably withheld), (C) the parties to each such assignment (other than an
assignment to a Federal Reserve Bank) shall execute and deliver to the
Administrative Agent for recording in the Register an instrument evidencing such
assignment, in substantially the form of Exhibit F (an “Assignment and
Acceptance”), and the assigning Bank or the Assignee shall pay to the
Administrative Agent an assignment fee in cash equal to $1,000 (if the Assignee
is already a Bank) or $3,500 (otherwise), and (D) as of the date of such
assignment, except with the prior written consent of API and the Administrative
Agent, (1) the Assignee shall not have any right, and shall have no knowledge
that such assignment would result in its having the right, to request
compensation pursuant to Section 4.04 after giving effect to such assignment and
(2) the parties to such assignment shall have no knowledge that such assignment
(a) would cause it to be unlawful for any party thereto to make or maintain any
Eurodollar Loan or to give effect to its obligations as contemplated hereby with
respect to any Eurodollar Loan or (b) would cause any Borrower to incur any
liability under Section 4.03 or 4.04. Upon acceptance and recording in the
Register, from and after the effective date specified in each Assignment and
Acceptance, which effective date shall be at least two Domestic Business Days
after the execution thereof, (A) the Assignee thereunder shall be a party hereto
and, to the extent of the Commitment assigned by such Assignment and Acceptance,
shall have the rights and obligations of, and shall for all purposes be, a Bank
under this Agreement and (B) the assigning Bank thereunder shall, to the extent
of the Commitment assigned by such Assignment and Acceptance, be released from
such Commitment (and, in the case of an Assignment and Acceptance covering all
or the remaining portion of an assigning Bank’s Commitment under this Agreement
and in the case of an assignment pursuant to Section 4.06, such Bank shall cease
to be a party hereto). Notwithstanding the foregoing, (A) any Bank assigning any
portion of its rights and obligations under this Agreement may retain any
Competitive Advance Loans made by it outstanding at such time and, in such case,
shall retain its rights hereunder in respect of any Competitive Advance Loans so
retained until such Loans have been repaid and (B) any Bank may at any time
assign or grant a security interest in its Loans and its rights (but not its
obligations) under this Agreement to a Federal Reserve Bank; provided that no
such assignment or grant pursuant to this clause (B) shall release a Bank from
any of its obligations hereunder.

     (ii) By executing and delivering an Assignment and Acceptance, the Assignee
thereunder shall be deemed to confirm to and agree with the other parties hereto
as follows: (A) such Assignee confirms that it has received a copy of this
Agreement, together with copies of the

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most recent financial statements delivered pursuant to Section 7.01 and such
other documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into such Assignment and Acceptance; (B)
such Assignee will independently and without reliance upon the Administrative
Agent, the assigning Bank or any other Bank and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement; (C) such
Assignee appoints and authorizes the Administrative Agent to take such action as
agent on its behalf and to exercise such powers under this Agreement as are
delegated to the Administrative Agent by the terms hereof; and (D) such Assignee
agrees that it will perform in accordance with their terms all the obligations
which by the terms of this Agreement are required to be performed by it as a
Bank with the Loans and Commitment assigned to it.

     (iii) Notwithstanding the foregoing, an Assignee shall not, by virtue of an
Assignment and Acceptance, become a party to this Agreement or a “Bank”, or have
any rights to consent to or refrain from consenting to any amendment, waiver or
other modification of any provision of any Credit Document unless such Assignee
shall thereby have accepted a Commitment hereunder; provided that no such
amendment, waiver or modification may reduce or postpone any payment of
principal or interest in respect of any Loan assigned to such Assignee thereby
without the written consent of such Assignee.

     (d) Federal Reserve Regulations. Notwithstanding any other provision of any
Credit Document, no Bank may sell, assign or participate all or any portion of
its Commitment or Loans hereunder to any “broker” or “dealer” (as defined in
Sections 3(a)(4) and 3(a)(5) of the Securities Exchange Act of 1934) or any
other Person that is a “creditor” (as defined in Regulation T of the Federal
Reserve Board). By executing and delivering this Agreement, each Bank hereby
confirms that it is not such a “broker”, “dealer” or “creditor”.

     Section 11.09. Waiver of Right to Jury. EACH OF THE BORROWERS, THE
ADMINISTRATIVE AGENT AND EACH OF THE BANKS WAIVES TRIAL BY JURY IN ANY JUDICIAL
PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN
TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED
WITH THE CREDIT DOCUMENTS OR THE RELATIONSHIPS ESTABLISHED UNDER THE CREDIT
DOCUMENTS.

     Section 11.10. Indemnity. The Borrowers, jointly and severally, agree to
indemnify the Administrative Agent and each of the Banks and their respective
directors, officers, employees, agents, advisors and controlling persons (each
such Person, an “Indemnitee”) against, and to hold each Indemnitee harmless
from, any and all losses, claims, damages, liabilities and related expenses,
including reasonable counsel fees and expenses, incurred by or asserted against
any Indemnitee arising out of, in any way connected with, or as a result of (i)
the execution or delivery of this Agreement or any agreement or instrument
contemplated hereby, the performance by the parties thereto of their respective
obligations hereunder or the consummation of the transactions contemplated
hereby, (ii) the use of the proceeds of the Loans or (iii) any claim,
litigation, investigation or proceeding relating to any of the foregoing,
whether or not any Indemnitee is a party thereto; provided that such indemnity
shall not, as to any Indemnitee, be available to the extent that such losses,
claims, damages, liabilities or related expenses are determined by a court of
competent jurisdiction by final and nonappealable judgment to have

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resulted from the gross negligence or willful misconduct of any Indemnitee. In
no event, however, shall any Indemnitee be liable on any theory of liability for
any special, indirect, consequential or punitive damages (including, without
limitation, any loss of profits, business or anticipated savings).

     The provisions of this Section 11.10 shall remain operative and in full
force and effect regardless of the expiration of the term of this Agreement, the
consummation of the transactions contemplated hereby, the repayment of any of
the Revolving Credit Loans or the Competitive Advance Loans, the reduction or
cancellation of the Total Commitment, the invalidity or unenforceability of any
term or provision of this Agreement or any Note, or any investigation made by or
on behalf of the Banks. All amounts due under this Section 11.10 shall be
payable in immediately available funds upon written demand therefor.

     Section 11.11. Consent to Jurisdiction. Any judicial proceeding brought
against any Borrower with respect to any Credit Document may be brought in any
court of competent jurisdiction in the City of New York, and, by its execution
and delivery of this Agreement or an Additional Borrower Confirmation pursuant
to Section 6.04, each Borrower shall be deemed, to the fullest extent permitted
by law, to (a) accept, generally and unconditionally, the jurisdiction of such
courts, (b) irrevocably waive any objection they may now or hereafter have as to
the venue of any suit, action or proceeding brought in such a court or that such
court is an inconvenient forum and (c) consent that service of process upon any
of them may be made by certified or registered mail, return receipt requested,
at their address specified or determined in accordance with the provisions of
Section 11.06 and service so made shall be deemed completed when received.
Nothing herein shall affect the right to serve process in any other manner
permitted by law or shall limit the right of the Bank to bring proceedings
against any Borrower in the courts of any other jurisdiction.

     Section 11.12. Confidentiality. Except as may be required to enforce the
rights and duties established hereunder, the parties hereto shall preserve in a
confidential manner all information received from any other party pursuant to
this Agreement, any Notes and the transactions contemplated hereunder and
thereunder, and shall not disclose such information except (i) to employees of
such Bank or its Affiliates involved in the administration of this Agreement
(including assignments and participations) and their respective directors,
attorneys and accountants (each of which shall be acting in a capacity with
respect to which a confidential relationship is established and recognized),
(ii) to any Participant or Assignee or any potential Participant or Assignee
(provided, that such Person shall agree to keep confidential all information
provided thereto, in accordance with this Section 11.12) and (iii) as required
by applicable law, including responses to requests for information by
appropriate bank regulatory agencies.

     Section 11.13. Judgment. To the fullest extent permitted under applicable
law, the obligation of any Borrower in respect of any sum due from it in Dollars
to any Bank or the Administrative Agent hereunder shall, notwithstanding any
judgment in any other currency, be discharged only to the extent that on the
Business Day following receipt by such Bank or the Administrative Agent (as the
case may be), of any sum adjudged to be so due in such other currency, such Bank
or the Administrative Agent (as the case may be) may in accordance with normal
banking procedures purchase Dollars with such other currency; if the amount of
Dollars so purchased is less than such sum due to such Bank or the
Administrative Agent (as the case may be) in Dollars, such Borrower agrees, as a
separate obligation and notwithstanding any such judgment,

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to indemnify such Bank or the Administrative Agent (as the case may be) against
such loss, and if the amount of Dollars so purchased exceeds such sum due to any
Bank or the Administrative Agent (as the case may be) in Dollars, such Bank or
the Administrative Agent (as the case may be) agrees to remit to such Borrower
such excess.

     Section 11.14. Execution in 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 the counterparts shall together constitute one and the same instrument.
Delivery of an executed counterpart of a signature page to this Agreement by
telecopier shall be effective as delivery of a manually executed counterpart of
this Agreement.

     Section 11.15. Patriot Act. Each Lender hereby notifies each Borrower that
pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56
(signed into law October 26, 2001)) (the "Act"), it is required to obtain,
verify and record information that identifies each borrower, guarantor or
grantor (the "Loan Parties"), which information includes the name and address of
each Loan Party and other information that will allow such Lender to identify
such Loan Party in accordance with the Act.

57

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

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.

AVON PRODUCTS, INC.        By: /s/ Richard J. Valone  

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

  Name: Richard J. Valone     Title: Vice President, Deputy Treasurer       AVON
CAPITAL CORPORATION        By: /s/ Richard J. Valone  

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

  Name: Richard J. Valone     Title: Vice President and Assistant Treasurer    
  CITIBANK, N.A., as Administrative Agent        By: /s/ Sandy Salgado  

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

  Name: Sandy Salgado     Title: Vice President       CITIBANK, N.A.        By:
/s/ Sandy Salgado  

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

  Name: Sandy Salgado     Title: Vice President       BANK OF AMERICA, N.A.     
  By: /s/ J. Casey Cosgrove  

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

  Name: J. Casey Cosgrove   Title: Vice President       JPMORGAN CHASE BANK,
N.A.        By: /s/ Stephanie Parker  

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

  Name: Stephanie Parker   Title: Vice President       BANK OF TOKYO-MITSUBISHI
UFJ TRUST
    COMPANY        By: /s/ James A. Profesta  

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

  Name: James A. Profesta     Title: Assistant Vice President            

58

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

 

DEUTSCHE BANK AG NEW YORK BRANCH        By: /s/ Vincent K. Wong  

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

  Name: Vincent K. Wong   Title: Vice President       By: /s/ Rainer Meier  

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

  Name: Rainer Meier    Title: Assistant Vice President   HSBC BANK USA,
NATIONAL ASSOCIATION        By: /s/ James P. Kelly  

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

  Name: James P. Kelly     Title: Senior Vice President       WILLIAM STREET
COMMITMENT
    CORPORATION       By: /s/ Mark Walton  

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

  Name: Mark Walton     Title: Assistant Vice President       MORGAN STANLEY
BANK        By: /s/ Daniel Twenge  

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

  Name: Daniel Twenge    Title: Vice President
Morgan Stanley Bank       BANCO SANTANDER CENTRAL HISPANO, S.A.,
    NEW YORK BRANCH        By: /s/ Frank G. English, IV  

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

  Name: Frank G. English, IV    Title: Managing Director       By: /s/ Karen M.
Wagner  

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

  Name: Karen M. Wagner     Title: Vice President      

59

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

BNP PARIBAS        By: /s/ Jerome d’Humieres  

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

  Name: Jerome d’Humieres     Title: Director       By: /s/ Angela B. Arnold  

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

  Name: Angela B. Arnold     Title: Vice President   BANCO BILBAO VIZCAYA
ARGENTARIA S.A.        By: /s/ Anne-Maureen Sarfati  

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

  Name: Anne-Maureen Sarfati     Title: Vice President
Global Corporate Banking       By: /s/ John Martini  

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

  Name: John Martini     Title: Vice President
Corporate Banking       THE NORTHERN TRUST COMPANY        By: /s/ Ashish S.
Bhagwat  

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

  Name: Ashish S. Bhagwat   Title: Vice President

60

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

Schedule 2.01

BANKS AND COMMITMENTS

Name of Bank   Address for Notices    Commitment as of the
Closing Date     

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

 

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

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

Citibank, N.A.   2 Penns Way   $140,000,000   (The Administrative Agent)   Suite
200           New Castle, DE 19720           Attn:  Thomas Bruscino             
      Bank of America, N.A.   231 South LaSalle Street   $140,000,000  
(Syndication Agent)   10th Floor           Chicago, IL 60604           Attn: 
Casey Cosgrove                    JPMorgan Chase Bank, N.A.   270 Park Avenue  
$140,000,000   (Syndication Agent)   New York, NY 10017           Attn:  Tina
Ruyter                    Bank of Tokyo-Mitsubishi UFJ   1251 Avenue of the
Americas   $75,000,000   Trust Company   New York, NY 10020-1104      
(Documentation Agent)   Attn:  Rolando Uy                    Deutsche Bank AG
New York   60 Wall Street   $75,000,000   Branch   New York, NY 10005      
(Documentation Agent)   Attn:  Linda Hill                    HSBC Bank USA,
National   452 Fifth Avenue   $75,000,000   Association   5th Floor      
(Documentation Agent)   New York, NY 10018           Attn:  Donna Riley         
          William Street Commitment   30 Hudson Street   $75,000,000  
Corporation   17th Floor           Jersey City, NJ 07302           Attn:  Philip
Green                    Morgan Stanley Bank   2500 Lake Park Boulevard  
$75,000,000       Suite 300C           West Valley City, UT 84120          
Attn:  Larry Benison                    Banco Santander Central   45 East 53rd
Street   $75,000,000   Hispano, S.A., New York Branch   New York, NY 10022      
    Attn:  Ligia Castro                    BNP Paribas   787 Seventh Avenue  
$55,000,000       New York, NY 10019           Attn:  Gabriel Candamo           
        Banco Bilbao Vizcaya   1345 Avenue of the Americas   $37,500,000  
Argentaria S.A.   45th Floor           New York, NY 10105           Attn: 
Patricia Kunert       

Schedule 2.01-1

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

The Northern Trust Company    50 S. LaSalle Street    $37,500,000       Chicago,
IL 60675            Attn: Joy Johnson              Total  $1,000,000,000  

Schedule 2.01-2

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

Schedule 5.01(e)

CERTAIN LITIGATION

     See (i) API’s Annual Report on Form 10-K for the fiscal year ended December
31, 2004, (ii) API’s Quarterly Reports on Form 10-Q for the fiscal quarters
ended March 31, 2005, June 30, 2005 and September 30, 2005 and (iii) API’s
Current Reports on Form 8-K filed with the Securities and Exchange Commission on
August 2, 2005, August 19, 2005, October 13, 2005, October 20, 2005 and January
4, 2006.

Schedule 5.01(e)-1

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

Schedule 6.04

CERTAIN ADDITIONAL BORROWERS

Avon European Financial Services Ltd - UK

Avon International Holdings Company - Cayman Islands

Avon Luxembourg Holdings S.a.r.l. - Luxembourg

Avon Luxembourg Holdings S.a.r.l., Luxembourg, Global Finance,
    Zweigniederlassung Zug - Swiss branch of Luxembourg company

Avon Luxembourg Holdings S.a.r.l., Luxembourg, UK Finance,
    Zweigniederlassung Zug - Swiss branch of Luxembourg company

Schedule 6.04-1

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

Exhibit A

Form of Revolving Credit Loan Request

> > > > > > [Date]

Citibank, N.A.
Two Penns Way
New Castle, Delaware 19720
Attention: Bank Loan Syndications

Re: Revolving Credit Loan Request

Dear Sirs:

     Reference is made to the Revolving Credit and Competitive Advance Facility
Agreement, dated as of January 13, 2006 (as amended, modified, supplemented or
extended from time to time, the “Credit Agreement”), among Avon Products, Inc.,
Avon Capital Corporation, the Additional Borrowers, banks and other lenders from
time to time parties thereto and Citibank, N.A., as Administrative Agent.
Capitalized terms used herein and not otherwise defined herein shall have the
meanings ascribed to such terms in the Credit Agreement.

     [NAME OF BORROWER] hereby gives you notice pursuant to Section 2.02(a) of
the Credit Agreement that it requests a Revolving Credit Loan, and in that
connection sets forth below the terms on which such Revolving Credit Loan is
requested to be made:

  (A)  Borrowing Date1  _______________      (B)  Principal Amount2 
$_______________    (C)  Interest Rate Basis  [ABR Loan] [Eurodollar Loan]   
(D)  Interest Period and the last day thereof3  _______________ 

Very truly yours,    [NAME OF BORROWER] 

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

1 Must be a Business Day.   2 Must be equal to $10,000,000 or an integral
multiple of $1,000,000 in excess thereof.   3 1, 2, 3 or 6 months in the case of
Eurodollar Loans. Not applicable to ABR Loans.  

Exhibit A-1

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

        By:    

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

  Title:  

2

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

Exhibit B-1

Form of Revolving Credit Note

[Principal Amount]  _____________ __, ____

     [NAME OF BORROWER], a [[New York] [Delaware] [jurisdiction of organization]
corporation] (the “Borrower”), for value received, promises to pay to the order
of [BANK] (the “Bank”), on the Termination Date applicable to the Bank, the
principal sum of [PRINCIPAL AMOUNT IN DOLLARS] or, if less, the aggregate
principal amount of the Revolving Credit Loans made by the Bank to the Borrower
pursuant to that certain Revolving Credit and Competitive Advance Facility
Agreement, dated as of January 13, 2006 (as amended, modified, supplemented or
extended from time to time, the “Credit Agreement”), among Avon Products, Inc.,
Avon Capital Corporation, the Additional Borrowers, banks and other lenders from
time to time parties thereto and Citibank, N.A., as Administrative Agent.

     The Borrower also promises to pay interest on the unpaid principal amount
of Revolving Credit Loans from time to time outstanding from the date hereof
until maturity (whether by acceleration or otherwise) and, after maturity, until
paid, at the rate or rates per annum and on the date or dates specified in the
Credit Agreement.

     Payments of both principal and interest are to be made in lawful money of
the United States of America in same day or immediately available funds to the
Administrative Agent at such office or offices of the Administrative Agent as
may be designated by the Administrative Agent pursuant to the Credit Agreement.

     All parties hereto, whether as makers, endorsers, or otherwise, severally
waive diligence, presentment, demand, protest and notice of any kind whatsoever.
The failure or forbearance by the holder to exercise any of its rights hereunder
in any particular instance shall in no event constitute a waiver thereof.

     All borrowings evidenced by this Note and all payments and prepayments of
the principal hereof and interest hereon and the respective dates thereof shall
be endorsed by the holder of this Note on the schedule attached hereto and made
a part hereof, or on a continuation thereof which shall be attached hereto and
made a part hereof, or shall be recorded by the holder of this Note in its
internal records; provided, however, that any failure of the holder of this Note
to make such a notation or any error in such notation shall in no manner affect
the validity or enforceability of the obligation of the Borrower to make
payments of principal and interest in accordance with the terms of this Note and
the Credit Agreement.

     This Note is one of the Revolving Credit Notes referred to in the Credit
Agreement, which among other things, contains provisions for the acceleration of
the maturity hereof upon the happening of certain events, for optional
prepayment of the principal hereof prior to the maturity thereof and for the
amendment or waiver of certain provisions of the Credit Agreement, all upon the
terms and conditions therein specified. Terms used and not otherwise defined
herein have the meanings ascribed thereto in the Credit Agreement.

Exhibit B-1-1

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

     THIS NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK AND SHALL BE DEEMED TO
BE A CONTRACT MADE UNDER, GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK.

     [Pursuant to the Credit Agreement, payment in full of principal and
interest on this Note is unconditionally guaranteed by Avon Products, Inc., a
New York corporation.]1

[NAME OF BORROWER]        By:    

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

  Title:  

 

 

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

1 The text in brackets is to be included only in Notes of ACC or an Additional
Borrower.

Exhibit B-1-2

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

REVOLVING CREDIT LOANS AND PRINCIPAL PAYMENTS

Amount of Revolving       Amount of Unpaid Principal Credit Loans Made   Amount
of Principal Repaid   Balance

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

 

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

 

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

        Euro dollar                           Notation   Interest              
Euro dollar   ABR Loan   Loan Made   Paid (if       Euro dollar       Data Loan
  Total   By   applicable)   ABR Loan   Loan   ABR Loan  

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

 

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

 

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

 

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

 

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

 

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

 

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

 

Exhibit B-1-3

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

Exhibit B-2

Form of Competitive Advance Note

[Principal Amount]  [Date] 

     [NAME OF BORROWER], a [[New York] [Delaware] [jurisdiction of organization]
[corporation]] (the “Borrower”), for value received, promises to pay to the
order of [BANK] (the “Bank”), on [MATURITY DATE], the principal sum of
[PRINCIPAL AMOUNT] pursuant to that certain Revolving Credit and Competitive
Advance Facility Agreement, dated as of January 13, 2006 (as amended, modified,
supplemented or extended from time to time, the “Credit Agreement”), among Avon
Products, Inc., Avon Capital Corporation, the Additional Borrowers, banks and
other lenders from time to time parties thereto and Citibank, N.A., as
Administrative Agent.

     The Borrower also promises to pay interest on the unpaid principal amount
hereof from time to time outstanding from the date hereof until maturity
(whether by acceleration or otherwise) and, after maturity, until paid, at the
rate or rates per annum and on the date or dates specified in or determined
pursuant to the Credit Agreement.

     Payments of both principal and interest are to be made in lawful money of
the United States of America in same day or immediately available funds to the
Administrative Agent at its office or offices as may be designated by the
Administrative Agent pursuant to the Credit Agreement.

     All parties hereto, whether as makers, endorsers, or otherwise, severally
waive diligence, presentment, demand, protest and notice of any kind whatsoever.
The failure or forbearance by the holder to exercise any of its rights hereunder
in any particular instance shall in no event constitute a waiver thereof.

     This Note is one of the Competitive Advance Notes referred to in the Credit
Agreement which, among other things, contains provisions for the acceleration of
the maturity hereof upon the happening of certain events and for the amendment
or waiver of certain provisions of the Credit Agreement, all upon the terms and
conditions therein specified. Terms used and not otherwise defined herein have
the meanings ascribed thereto in the Credit Agreement.

     THIS NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK AND SHALL BE DEEMED TO
BE A CONTRACT MADE UNDER, GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK.

Exhibit B-2-1

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

     [Pursuant to the Credit Agreement, payment in full of principal and
interest on this Note is unconditionally guaranteed by Avon Products, Inc.]1

[NAME OF BORROWER]        By:    

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

  Title:  

 

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

1 The text in brackets is to be included only in Notes of ACC or an Additional
Borrower.

Exhibit B-2-2

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

Exhibit C-1

Competitive Advance Facility Procedures

     1.01 Competitive Advance Loan Requests shall be given to the Administrative
Agent at:

> > Citibank, N.A.
> > Two Penns Way
> > New Castle, Delaware 19720
> > 
> > Telephone: 302-894-6011
> > Telecopy: 212-994-0961
> > Attention: Bank Loan Syndications

     1.02 With respect to any Competitive Advance Loan requested by a Borrower
to be made on a Borrowing Date, the Competitive Advance Notice Time, Competitive
Advance Bid Deadline and Competitive Advance Accept/Reject Deadline shall be
determined in the manner set forth below:

     Competitive Advance Notice Time: 10:30 A.M., New York time, one Domestic
Business Day (or four Eurodollar Business Days in the case of a Competitive
Eurodollar Loan) prior to the Borrowing Date.

     Competitive Advance Bid Deadline: 9:30 A.M., New York time, on the
Borrowing Date (or three Eurodollar Business Days prior to the Borrowing Date in
the case of a Competitive Eurodollar Loan); provided that in the case of a
Competitive Advance Bid submitted by the Administrative Agent, in its capacity
as a Bank, the Competitive Advance Bid Deadline shall be 15 minutes prior to the
foregoing time.

     Competitive Advance Accept/Reject Deadline: 10:30 A.M., New York time, on
the Borrowing Date (or three Eurodollar Business Days prior to the Borrowing
Date for Competitive Eurodollar Loans).

Exhibit C-1-1

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

Exhibit C-2

Form Of Competitive Advance Loan Request

> [Date]

Citibank, N.A.
Two Penns Way
New Castle, Delaware 19720
Attention: Bank Loan Syndications

Re: Competitive Advance Loan Request

Dear Sirs:

     Reference is made to the Revolving Credit and Competitive Advance Facility
Agreement, dated as of January 13, 2006 (as amended, modified, supplemented or
extended from time to time, the “Credit Agreement”), among Avon Products, Inc.,
Avon Capital Corporation, the Additional Borrowers, banks and other lenders from
time to time parties thereto and Citibank, N.A., as Administrative Agent.
Capitalized terms used herein and not otherwise defined herein shall have the
meanings ascribed to such terms in the Credit Agreement.

     [NAME OF BORROWER] hereby gives you notice pursuant to Section 2.07 of the
Credit Agreement that it requests offers to make Competitive Advance Loans under
the Credit Agreement, and in that connection sets forth below the terms on which
such Competitive Advance Loans are requested to be made:

  (A)  Borrowing Date1  ___________________________     (B)  Aggregate Principal
Amount2  ___________________________     (C)  Maturity Date3 
___________________________     (D)  Interest Rate Basis  [Fixed Rate]
[Eurodollar Rate] 

 

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

1 Must be a Eurodollar Business Day.   2 Must be an amount not less than
$10,000,000.   3 At least 10 days and not more than 180 after the Borrowing
Date, in the case of a Competitive Absolute Rate Loan, and not more than 6
months after the Borrowing Date, in the case of a Competitive Eurodollar Loan.  

Exhibit C-2-1

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

  (E)  Interest Period, if any4  ___________________________  

Very truly yours,    [NAME OF BORROWER]        By:    

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

  Title:         Countersigned:        By:    

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

  A Responsible Officer of API      

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

4 1, 2, 3 or 6 months with respect to Competitive Eurodollar Loans. Not
applicable with respect to Competitive Absolute Rate Loans.

Exhibit C-2-2

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

Exhibit C-3

Form of Competitive Advance Notice Letter

[Date]

[Name of Bank]
[Address]

Attention:______________________

Re: Notice of a Competitive Advance Loan Request

Dear Sirs:

     Reference is made to the Revolving Credit and Competitive Advance Facility
Agreement, dated as of January 13, 2006 (as amended, modified, supplemented or
extended from time to time, the “Credit Agreement”), among Avon Products, Inc.,
Avon Capital Corporation, the Additional Borrowers, banks and other lenders from
time to time parties thereto and Citibank, N.A., as Administrative Agent.
Capitalized terms used but not defined herein shall have the meanings assigned
to such terms in the Credit Agreement.

     [NAME OF BORROWER] delivered to the Administrative Agent a Competitive
Advance Loan Request on ____________, __, pursuant to Section 2.07 of the Credit
Agreement, and in that connection you are invited to submit a Bid to make a
Competitive Advance Loan to such Borrower by [TIME], on _______________, ____.1
Your Bid must comply with Section 2.07 of the Credit Agreement and the terms set
forth below on which the Bid Request was made:

  (A)  Proposed Borrowing Date ________________   (B)  Principal amount of
Competitive Advance Loan ________________   (C)  Interest rate basis          
[Fixed Rate] [Eurodollar Rate]    (D)  Interest Period and the last day thereof
________________      

Very truly yours,    Citibank, N.A., as
Administrative Agent       By:    

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

  Title:  

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

1 The Bid must be received by the Administrative Agent not later than the Bid
Deadline specified in Exhibit C-1.

Exhibit C-3-1

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

Exhibit C-4

Form of Competitive Advance Bid

[Date]

Citibank, N.A.
Two Penns Way
New Castle, Delaware 19720
Attention: Bank Loan Syndications

Re: Competitive Advance Bid

Dear Sirs:

     Reference is made to the Revolving Credit and Competitive Advance Facility
Agreement, dated as of January 13, 2006 (as amended, modified, supplemented or
extended from time to time, the “Credit Agreement”), among Avon Products, Inc.,
Avon Capital Corporation, the Additional Borrowers, banks and other lenders from
time to time parties thereto and Citibank, N.A., as Administrative Agent.
Capitalized terms used but not defined herein shall have the meanings assigned
to such terms in the Credit Agreement.

     [NAME OF BANK] hereby submits a Competitive Advance Bid pursuant to Section
2.07 of the Credit Agreement, in response to the Competitive Advance Loan
Request made by [NAME OF BORROWER] on ______________, ____, and in that
connection sets forth below the terms on which such Competitive Advance Bid is
made:

>      (A) Principal Amount1 _____________________
> 
>      (B) Competitive Advance Bid [Rate] [Margin]2 _____________________

     The undersigned hereby acknowledges that, pursuant to Section 2.07(c) of
the Credit Agreement, by marking the indicated box below, it will be deemed to
have waived the right to claim compensation under Sections 3.03(d), 4.04(a) or
4.04(b) of the Credit Agreement with respect to any Competitive Advance Loan
made pursuant to this Competitive Advance Bid.

  Section 3.03(c)  |_|    Section 4.04(a)  |_|    Section 4.04(b)  |_| 

 

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

1 Principal amount must be at least $10,000,000 and not greater than the
requested Competitive Advance Loan. Multiple bids may be accepted by the
Administrative Agent.   2 In the case of a Competitive Absolute Rate Loan, __%;
in the case of a Competitive Eurodollar Loan, a margin (+/- __%) over LIBOR.

Exhibit C-4-1

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

     The undersigned hereby confirms that it will, subject only to the
conditions set forth in the Credit Agreement, extend credit to the relevant
Borrower upon acceptance by the relevant Borrower of this Competitive Advance
Bid in accordance with Section 2.07 of the Credit Agreement.

Very truly yours,    [NAME OF BANK]       By:    

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

  Title:  

Exhibit C-4-2

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

Exhibit C-5

Form of Competitive Advance Bid Accept/Reject Letter

[Date]

Citibank, N.A.
Two Penns Way
New Castle, Delaware 19720
Attention: Bank Loan Syndications

Re: Competitive Advance Bid Acceptance/Reject Letter

Dear Sirs:

     [NAME OF BORROWER] refers to the Revolving Credit and Competitive Advance
Facility Agreement, dated as of January 13, 2006 (as amended, modified,
supplemented or extended from time to time, the “Credit Agreement”), among Avon
Products, Inc., Avon Capital Corporation, the Additional Borrowers, banks and
other lenders from time to time parties thereto and Citibank, N.A., as
Administrative Agent.

     In accordance with Section 2.07 of the Credit Agreement, we have received a
summary of bids in connection with our Competitive Advance Loan Request dated
________, ____, and in accordance with Section 2.07(d)(ii) of the Credit
Agreement, we hereby accept the following Competitive Advance Bids for
Competitive Advance Loans to be made on _________, ____, with a Maturity Date of
____________, ____:

    Competitive Advance     Principal Amount   Rate/Margin   Bank

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

 

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

 

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

    %/+/-.         %                We hereby reject the following bids:       
      Competitive Advance     Principal Amount   Rate/Margin   Bank

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

 

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

 

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

    %/+/-.          %     

 

Very truly yours,    [NAME OF BORROWER]        By:    

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

  Title:  

Exhibit C-5-1

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

Exhibit D

Form of Continuation/Conversion Request

[Date]

Citibank, N.A.
Two Penns Way
New Castle, Delaware 19720
Attention: Bank Loan Syndications

Re: Continuation/Conversion Request

Dear Sirs:

     Reference is made to the Revolving Credit and Competitive Advance Facility
Agreement, dated as of January 13, 2006 (as amended, modified, supplemented or
extended from time to time, the “Credit Agreement”), among Avon Products, Inc.,
Avon Capital Corporation, the Additional Borrowers, banks and other lenders from
time to time parties thereto and Citibank, N.A., as Administrative Agent.
Capitalized terms used herein but not otherwise defined herein shall have the
meanings ascribed to such terms in the Credit Agreement.

     [NAME OF BORROWER] hereby requests pursuant to Section 3.05(a) of the
Credit Agreement that on __________, ____:

     (1) $___,000,000 of the presently outstanding principal amount of Revolving
Credit Loans presently being maintained as [ABR] [Revolving Eurodollar] Loans
[with an Interest Period ending on
_______________, _____],

     (2) be [converted into] [continued as],

     (3) [Revolving Eurodollar Loans having an Interest Period of
[one][two][three][six] months] [ABR Loans].

Very truly yours,    [NAME OF BORROWER]        By:    

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

  Title:  

Exhibit D-1

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

Exhibit E-1

Form of Additional Borrower [Designation] [Termination]

[Date]

Citibank, N.A.
Two Penns Way
New Castle, Delaware 19720
Attention: Bank Loan Syndications

Re: Additional Borrower Designation

Dear Sirs:

     Reference is made to the Revolving Credit and Competitive Advance Facility
Agreement, dated as of January 13, 2006 (as the same may be amended,
supplemented or otherwise modified from time to time, the “Credit Agreement”),
among Avon Products, Inc., Avon Capital Corporation, the Additional Borrowers,
banks and other lenders from time to time parties thereto and Citibank, N.A., as
Administrative Agent. Terms defined in the Credit Agreement and used herein
shall have the meanings given to them in the Credit Agreement.

     1. [Please be advised that the following Subsidiary is hereby designated as
an Additional Borrower and, subject to Section 6.04 of the Credit Agreement,
such Subsidiary will be authorized to use the credit facilities provided for
under the Credit Agreement:] [Please be advised that the designation of the
following Subsidiary as an Additional Borrower is terminated effective on the
date referred to in paragraph 2 below:]

[Insert Name and
Address of Additional
Borrower]

     2. The effective date of this Additional Borrower [Designation]
[Termination] will be _____________ ___, ____.

Exhibit E-1

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

 

Very truly yours,    AVON PRODUCTS, INC.        By:    

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

  Title:         [NAME OF ADDITIONAL BORROWER]1        By:    

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

  Title:  

Accepted and Acknowledged:    CITIBANK, N.A., as
Administrative Agent       By:    

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

  Title:  

 

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

1 Additional Borrower signature necessary only in the case of termination of
designation.

Exhibit E-1-2

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

Exhibit E-2

Form of Additional Borrower Confirmation

[Date]

Citibank, N.A.
Two Penns Way
New Castle, Delaware 19720
Attention: Bank Loan Syndications

Re: Additional Borrower Confirmation

Dear Sirs:

     Reference is made to the Revolving Credit and Competitive Advance Facility
Agreement, dated as of January 13, 2006 (as the same may be amended,
supplemented or otherwise modified from time to time, the “Credit Agreement”),
among Avon Products, Inc., Avon Capital Corporation, the Additional Borrowers,
banks and other lenders from time to time parties thereto and Citibank, N.A., as
Administrative Agent. Terms defined in the Credit Agreement and used herein
shall have the meanings given to them in the Credit Agreement.

     The undersigned (1) also refers to the Additional Borrower Designation,
effective ____________, ____ (the “Designation Effective Date”), in which the
undersigned has been designated an Additional Borrower and (2) hereby confirms
that, by its execution hereof, the undersigned acknowledges that it has received
a copy of the Credit Agreement, confirms that the representations and warranties
contained in Section 5.01 of the Credit Agreement (except the representations
and warranties contained in Section 5.01(d)(ii) or 5.01(e) and any other
representation or warranty that expressly relates to a date certain) are true
and correct insofar as they relate to the undersigned as of the Designation
Effective Date hereof, the conditions specified in Section 6.02 have been
satisfied insofar as relate to the undersigned, and agrees that, from and after
the Designation Effective Date, subject to Section 6.04 of the Credit Agreement,
it shall be a party to the Credit Agreement and shall be bound, as a “Borrower”
and an “Additional Borrower”, by all of the provisions thereof.

Very truly yours,    [NAME OF ADDITIONAL BORROWER]       By:    

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  Title:  

Exhibit E-2-1

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Exhibit F

Assignment and Acceptance

     Reference is made to the Revolving Credit and Competitive Advance Facility
Agreement, dated as of January 13, 2006 (as amended, modified, extended or
superseded from time to time, the “Credit Agreement”), among Avon Products,
Inc., Avon Capital Corporation, the Additional Borrowers, banks and other
lenders from time to time parties thereto and Citibank, N.A., as Administrative
Agent. Capitalized terms defined in the Credit Agreement are used herein with
the same meanings.

     Section 1.01. Assignment and Acceptance. The Assignor identified in Annex 1
hereto hereby sells and assigns, without recourse, to the Assignee identified in
Annex 1 hereto, and the Assignee hereby purchases and assumes, without recourse,
from the Assignor, effective as of the Assignment Effective Date set forth in
Annex 1 hereto, the interests set forth on Annex 1 hereto (the “Assigned
Interest”) in the Assignor’s rights and obligations under the Credit Agreement,
including, without limitation, the interests set forth on Annex 1 in the
Commitment of the Assignor on the Assignment Effective Date and the [Competitive
Advance Loans and] Revolving Credit Loans owing to the Assignor which are
outstanding on the Assignment Effective Date. Each of the Assignor and the
Assignee hereby makes and agrees to be bound by all the representations,
warranties and agreements set forth in Section 11.08(c) of the Credit Agreement,
a copy of which has been received by each such party. From and after the
Assignment Effective Date (i) the Assignee shall be a party to and be bound by
the provisions of the Credit Agreement and, to the extent of the interests
assigned by this Assignment and Acceptance, have the rights and obligations of a
Bank thereunder and (ii) the Assignor shall, to the extent of the interests
assigned by this Assignment and Acceptance, relinquish its rights and be
released from its obligations under the Credit Agreement.

     Section 1.02. Other Documentation. This Assignment and Acceptance is being
delivered to the Administrative Agent together with a properly completed Annex 2
hereto if the Assignee is not already a Bank under the Credit Agreement.

     Section 1.03. Representations and Warranties of the Assignor. The Assignor
(i) represents and warrants that it is the legal and beneficial owner of the
interest being assigned by it hereunder and that such interest is free and clear
of any adverse claim; (ii) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Credit Agreement, or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Credit
Agreement, or any other instrument or document executed furnished pursuant
thereto; and (iii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrowers or the
performance or observance by the Borrowers of any of their obligations under the
Credit Agreement or any other instrument or document furnished pursuant thereto.

     Section 1.04. Representations and Warranties of the Assignee. The Assignee
hereby agrees with, and represents and warrants to, the Assignor, the other
Banks, the Borrowers and the Administrative Agent as specified in Section
11.08(c) of the Credit Agreement.

Exhibit F-1

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     Section 1.05. Governing Law. This Assignment and Acceptance shall be
governed by and construed in accordance with the laws of the State of New York.

     IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Acceptance to be executed by their respective officers thereunto duly
authorized, as of the date first above written, such execution being made on
Annex 1 hereto.

Exhibit F-2

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Annex 1 to Assignment and Acceptance

Date of Assignment:
Legal Name of Assignor:
Legal Name of Assignee:
Assignee’s Address for Notices:
Effective Date of Assignment
(may not be fewer than two Domestic Business
Days after the Date of Assignment):

        Percentage         Assigned of         Commitment (set     Principal
Amount Assigned (and   forth, to at least 8     identifying information as to  
decimals, as a     individual Competitive Advance   percentage of the     Loans)
  Total Commitment)

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          Commitment Assigned:    %                Revolving Credit Loans:    $ 
              Competitive Advance Loans:    $                If the Assignor is
a Non-Extending         Bank, indicate the Termination         Date applicable
to the Assignee in         respect of the Commitment         Assigned and the
Revolving         Credit Loans:        

 

The terms set forth above are hereby agreed to:    _____________________, as
Assignor       By:    

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  Name:     Title:         ____________________, as Assignee        By:    

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  Name:     Title:         Consent given: 

Annex 1-1

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AVON PRODUCTS, INC.    By:    

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  Name:     Title:  

Exhibit F-2

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Annex 2 to Assignment and Acceptance

LEGAL NAME OF ASSIGNEE TO APPEAR IN DOCUMENTATION:

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GENERAL INFORMATION – ABR LENDING OFFICE: Institution Name:

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Street Address:

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City, State, Country, Zip Code:

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GENERAL INFORMATION – EURODOLLAR LENDING OFFICE: Institution Name:

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Street Address:

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City, State, Country, Zip Code:

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GENERAL INFORMATION – COMPETITIVE ADVANCE LENDING OFFICE: Institution Name:

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Street Address:

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City, State, Country, Zip Code:

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CONTACTS/NOTIFICATION METHODS: CREDIT CONTACTS: Primary Contact:

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Street Address:

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City, State, Country, Zip Code:

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Phone Number:

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FAX Number:

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Backup Contact:

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Street Address:

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City, State, Country, Zip Code:

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Phone Number:

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FAX Number:

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Annex 2-1

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TAX WITHHOLDING:

> Non Resident Alien _____ Y* _____ N
> * Form W-8BEN Enclosed
> 
> Tax ID Number _______________

CONTACTS/NOTIFICATION METHODS: ADMINISTRATIVE CONTACTS – BORROWINGS, PAYDOWNS,
INTEREST, FEES, ETC. Contact:

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Street Address:

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City, State, Country, Zip Code:

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Phone Number:

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FAX Number:

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COMPETITIVE ADVANCE LOAN NOTIFICATION: Contact:

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Street Address:

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City, State, Country, Zip Code:

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Phone Number:

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FAX Number:

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PAYMENT INSTRUCTIONS: Name of Bank where funds are to be transferred:

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Routing Transit/ABA number of Bank where funds are to be transferred:

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Name of Account, if applicable:

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Account Number:

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Additional Information:

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Annex 2-2

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MAILINGS: Please specify who should receive financial information: Name:

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Street Address:

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City, State, Country, Zip Code:

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It is very important that all of the above information is accurately filled in
and returned promptly. If there is someone other than yourself who should
receive this questionnaire, please notify us of their name and FAX number and we
will FAX them a copy of the questionnaire. If you have any questions, please
call _______________ on (212) ___________.

Annex 2-3