Ex10-ee
EXECUTION COPY

U.S. $250,000,000

THREE YEAR CREDIT AGREEMENT

Dated as January 19, 2001

Among

BAUSCH & LOMB INCORPORATED

as

Borrower

and

THE INITIAL LENDERS NAMED HEREIN

as

Initial Lenders

and

CITIBANK, N.A.

as

Administrative Agent

and

SALOMON SMITH BARNEY INC.

as

Arranger

and

FLEET NATIONAL BANK

as

Documentation Agent

and

THE CHASE MANHATTAN BANK

as

Syndication Agent

 

Table of Contents

ARTICLE 1 DEFINITIONS AND ACCOUNTING TERMS

Page

SECTION 1.01

Certain Defined Terms

1

SECTION 1.02

Computation of Time Periods

8

SECTION 1.03

Accounting Terms

9

 

ARTICLE II AMOUNTS AND TERMS OF THE ADVANCES

SECTION 2.01

The Advances

9

SECTION 2.02

Making the Advances

9

SECTION 2.03

Fees

10

SECTION 2.04

Termination or Reduction of the Commitments

10

SECTION 2.05

Repayment

10

SECTION 2.06

Interest

10

SECTION 2.07

Interest Rate Determination

11

SECTION 2.08

Optional Conversion of Advances

11

SECTION 2.09

Optional Prepayments

12

SECTION 2.10

Increased Costs

12

SECTION 2.11

Illegality

12

SECTION 2.12

Payments and Computations

12

SECTION 2.13

Taxes

13

SECTION 2.14

Sharing of Payments, Etc.

15

SECTION 2.15

Use of Proceeds

15

SECTION 2.16

Evidence of Debt

15

 

ARTICLE III CONDITIONS TO EFFECTIVENESS AND LENDING

SECTION 3.01

Condtions Precedent to Effectiveness of Section 2.01

15

SECTION 3.02

Conditions Precedent to Each Borrowing

17

SECTION 3.03

Determinations under Section 3.01

17

 

ARTICLE IV REPRESENTATIONS AND WARRANTIES

SECTION 4.01

Representations and Warranties of the Borrower

17

 

ARTICLE V COVENANTS OF THE BORROWER

SECTION 5.01

Affirmative Covenants

19

SECTION 5.02

Negative Covenants

21

SECTION 5.03

Financial Covenants

22

 

ARTICLE VI EVENTS OF DEFAULT

SECTION 6.01

Events of Default

23

 

ARTICLE VII THE AGENT

SECTION 7.01

Authorization and Action

24

SECTION 7.02

Agent's Reliance, Etc.

25

SECTION 7.03

Citibank and Affiliates

25

SECTION 7.04

Lender Credit Decision

25

SECTION 7.05

Indemnification

25

SECTION 7.06

Successor Agent

26

 

ARTICLE VIII MISCELLANEOUS

SECTION 8.01

Amendments, Etc.

26

SECTION 8.02

Notices, Etc.

26

SECTION 8.03

No Waiver; Remedies

27

SECTION 8.04

Costs and Expenses

27

SECTION 8.05

Right of Set-Off

28

SECTION 8.06

Binding Effect

28

SECTION 8.07

Assignments and Particpations

28

SECTION 8.08

Confidentiality

30

SECTION 8.09

Governing Law

30

SECTION 8.10

Execution in Counterparts

30

SECTION 8.11

Jurisdiction, Etc.

31

SECTION 8.12

Waiver of Jury Trial

32

 

Schedules

Schedule 1 - List of Applicable Lending Office

Schedule 3.01(b) - Disclosed Litigation

Schedule 4.01(j) - Existing Liens

Schedule 4.01(n) - Significant Subsidiaries

Schedule 5.02(d) - Existing Debt

Exhibits

Exhibit A - Form of Promissory Note

Exhibit B - Form of Notice of Borrowing

Exhibit C - Form of Assignment and Acceptance

Exhibit D - Form of Opinion of Counsel for the Borrower

THREE YEAR CREDIT AGREEMENT

Dated as of January 19, 2001

BAUSCH & LOMB INCORPORATED, a New York corporation (the "Borrower"), the banks,
financial institutions and other institutional lenders (the "Initial Lenders")
listed on the signature pages hereof, SALOMON SMITH BARNEY INC., as arranger,
FLEET NATIONAL BANK, as documentation agent, THE CHASE MANHATTAN BANK, as
syndication agent, and CITIBANK, N.A. ("Citibank"), as administrative agent (the
"Agent") for the Lenders (as hereinafter defined), agree as follows:

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

SECTION 1.01   Certain Defined Terms   As used in this Agreement, the following
terms shall have the following meanings (such meanings to be equally applicable
to both the singular and plural forms of the terms defined):

"Advance" means an advance by a Lender to the Borrower pursuant to Article II,
and refers to a Base Rate Advance or a Eurodollar Rate Advance (each of which
shall be a "Type" of Advance).

"Affiliate" means, as to any Person, any other Person that, directly or
indirectly, controls, is controlled by or is under common control with such
Person or is a director or officer of such Person. For purposes of this
definition, the term "control" (including the terms "controlling", "controlled
by" and "under common control with") of a Person means the possession, direct or
indirect, of the power to vote 5% or more of the Voting Stock of such Person or
to direct or cause the direction of the management and policies of such Person,
whether through the ownership of Voting Stock, by contract or otherwise.

"Agent's Account" means the account of the Agent maintained by the Agent at
Citibank with its office at 399 Park Avenue, New York, New York 10043, Account
No. 36852248, Attention:  Bank Loan Syndications.

"Applicable Lending Office" means, with respect to each Lender, such Lender's
Domestic Lending Office in the case of a Base Rate Advance and such Lender's
Eurodollar Lending Office in the case of a Eurodollar Rate Advance.

"Applicable Margin" means, as of any date (a) for Base Rate Advances, 0.00% per
annum and (b) for Eurodollar Rate Advances, a percentage per annum determined by
reference to the Public Debt Rating in effect on such date as set forth below:

Public Debt Rating
S&P/Moody's

Applicable Margin for
Eurodollar Rate Advances

Level 1

BBB and Baa2

0.600%

Level 2

Lower than Level 1 but at least BBB or Baa2

0.675%

Level 3

Lower than Level 2 but at least BBB- and Baa3

0.800%

Level 4

Lower than Level 3 but at least BBB- or Baa3

1.025%

Level 5

Lower than Level 4

1.225%

"Applicable Percentage" means, as of any date, a percentage per annum determined
by reference to the Public Debt Rating in effect on such date as set forth
below:

Public Debt Rating
S&P/Moody's

Applicable
Percentage

Level 1

BBB and Baa2

0.150%

Level 2

Lower than Level 1 but at least BBB or Baa2

0.175%

Level 3

Lower than Level 2 but at least BBB- and Baa3

0.200%

Level 4

Lower than Level 3 but at least BBB- or Baa3

0.225%

Level 5

Lower than Level 4

0.275%

"Assignment and Acceptance" means an assignment and acceptance entered into by a
Lender and an Eligible Assignee, and accepted by the Agent, in substantially the
form of Exhibit C hereto.

"Base Rate" means a fluctuating interest rate per annum in effect from time to
time, which rate per annum shall at all times be equal to the highest of:

(a)

the rate of interest announced publicly by Citibank in New York, New York, from
time to time, as Citibank's base rate;

(b)

the sum (adjusted to the nearest 1/4 of 1% or, if there is no nearest 1/4 of 1%,
to the next higher 1/4 of 1%) of (i) 1/2 of 1% per annum, plus (ii) the rate
obtained by dividing (A) the latest three-week moving average of secondary
market morning offering rates in the United States for three-month certificates
of deposit of major United States money market banks, such three-week moving
average (adjusted to the basis of a year of 360 days) being determined weekly on
each Monday (or, if such day is not a Business Day, on the next succeeding
Business Day) for the three-week period ending on the previous Friday by
Citibank on the basis of such rates reported by certificate of deposit dealers
to and published by the Federal Reserve Bank of New York or, if such publication
shall be suspended or terminated, on the basis of quotations for such rates
received by Citibank from three New York certificate of deposit dealers of
recognized standing selected by Citibank, by (B) a percentage equal to 100%
minus the average of the daily percentages specified during such three-week
period by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement (including, but not
limited to, any emergency, supplemental or other marginal reserve requirement)
for Citibank with respect to liabilities consisting of or including (among other
liabilities) three-month U.S. dollar non-personal time deposits in the United
States, plus (iii) the average during such three-week period of the annual
assessment rates estimated by Citibank for determining the then current annual
assessment payable by Citibank to the Federal Deposit Insurance Corporation (or
any successor) for insuring U.S. dollar deposits of Citibank in the United
States; and

(c)

1/2 of one percent per annum above the Federal Funds Rate.

"Base Rate Advance" means an Advance that bears interest as provided in
Section 2.06(a)(i).

"Borrowing" means a borrowing consisting of Advances of the same Type made on
the same day by the Lenders.

"Business Day" means a day of the year on which banks are not required or
authorized by law to close in New York City and, if the applicable Business Day
relates to any Eurodollar Rate Advances, on which dealings are carried on in the
London interbank market.

"Commitment" has the meaning specified in Section 2.01.

"Confidential Information" means information that the Borrower furnishes to the
Agent or any Lender in a writing designated as confidential, but does not
include any such information that is or becomes generally available to the
public or that is or becomes available to the Agent or such Lender from a source
other than the Borrower.

"Consolidated" refers to the consolidation of accounts in accordance with GAAP.

"Convert", "Conversion" and "Converted" each refers to a conversion of Advances
of one Type into Advances of the other Type pursuant to Section 2.07 or 2.08.

"Debt" of any Person means, without duplication, (a) all indebtedness of such
Person for borrowed money, (b) all obligations of such Person for the deferred
purchase price of property or services (other than trade payables not overdue by
more than 60 days incurred in the ordinary course of such Person's business),
(c) all obligations of such Person evidenced by notes, bonds, debentures or
other similar instruments, (d) all obligations of such Person created or arising
under any conditional sale or other title retention agreement with respect to
property acquired by such Person (even though the rights and remedies of the
seller or lender under such agreement in the event of default are limited to
repossession or sale of such property), (e) all obligations of such Person as
lessee under leases that have been or should be, in accordance with GAAP,
recorded as capital leases, (f) all obligations, contingent or otherwise, of
such Person in respect of acceptances, letters of credit or similar extensions
of credit, (g) all net obligations of such Person in respect of Hedge
Agreements, (h) all Debt of others referred to in clauses (a) through (g) above
or clause (i) below guaranteed directly or indirectly in any manner by such
Person, or in effect guaranteed directly or indirectly by such Person through an
agreement (1) to pay or purchase such Debt or to advance or supply funds for the
payment or purchase of such Debt, (2) to purchase, sell or lease (as lessee or
lessor) property, or to purchase or sell services, primarily for the purpose of
enabling the debtor to make payment of such Debt or to assure the holder of such
Debt against loss, (3) to supply funds to or in any other manner invest in the
debtor (including any agreement to pay for property or services irrespective of
whether such property is received or such services are rendered), primarily for
the purpose of enabling the debtor to make payment of such Debt or to assure the
holder of such Debt against loss or (4) otherwise to assure a creditor against
loss, and (i) all Debt referred to in clauses (a) through (h) above secured by
(or for which the holder of such Debt has an existing right, contingent or
otherwise, to be secured by) any Lien on property (including, without
limitation, accounts and contract rights) owned by such Person, even though such
Person has not assumed or become liable for the payment of such Debt.

"Debt for Borrowed Money" of any Person means all items that, in accordance with
GAAP, would be classified as notes payable, long term debt or current portion of
long term debt on a Consolidated balance sheet of such Person.

"Default" means any Event of Default or any event that would constitute an Event
of Default but for the requirement that notice be given or time elapse or both.

"Disclosed Litigation" has the meaning specified in Section 3.01(b).

"Domestic Lending Office" means, with respect to any Lender, the office of such
Lender specified as its "Domestic Lending Office" opposite its name on
Schedule I hereto or in the Assignment and Acceptance pursuant to which it
became a Lender, or such other office of such Lender as such Lender may from
time to time specify to the Borrower and the Agent.

"EBITDA" means, for any period, net income (or net loss) plus the sum of
(a) interest expense, (b) income tax expense, (c) depreciation expense,
(d) amortization expense, (e) other non-cash non-recurring charges and (f)
extraordinary or unusual losses deducted in calculating net income less
extraordinary or unusual gains added in calculating net income, in each case
determined in accordance with GAAP for such period.

"Effective Date" has the meaning specified in Section 3.01.

"Eligible Assignee" means (i) a Lender; (ii) an Affiliate of a Lender; and
(iii)  any other Person approved by the Agent and, unless an Event of Default
has occurred and is continuing at the time any assignment is effected in
accordance with Section 8.07, any other Person approved by the Borrower, such
approval not to be unreasonably withheld or delayed; provided, however, that
neither the Borrower nor an Affiliate of the Borrower shall qualify as an
Eligible Assignee.

"Environmental Action" means any action, suit, demand, demand letter, claim,
notice of non-compliance or violation, notice of liability or potential
liability, investigation, proceeding, consent order or consent agreement
relating in any way to any Environmental Law, Environmental Permit or Hazardous
Materials or arising from alleged injury or threat of injury to health, safety
or the environment, including, without limitation, (a) by any governmental or
regulatory authority for enforcement, cleanup, removal, response, remedial or
other actions or damages and (b) by any governmental or regulatory authority or
any third party for damages, contribution, indemnification, cost recovery,
compensation or injunctive relief.

"Environmental Law" means any federal, state, local or foreign statute, law,
ordinance, rule, regulation, code, order, judgment, decree or judicial or agency
interpretation, policy or guidance relating to pollution or protection of the
environment, health, safety or natural resources, including, without limitation,
those relating to the use, handling, transportation, treatment, storage,
disposal, release or discharge of Hazardous Materials.

"Environmental Permit" means any permit, approval, identification number,
license or other authorization required under any Environmental Law.

"ERISA" means the Employee Retirement Income Security Act of 1974, as amended
from time to time, and the regulations promulgated and rulings issued
thereunder.

"ERISA Affiliate" means any Person that for purposes of Title IV of ERISA is a
member of the Borrower's controlled group, or under common control with the
Borrower, within the meaning of Section 414 of the Internal Revenue Code.

"ERISA Event" means (a) (i) the occurrence of a reportable event, within the
meaning of Section 4043 of ERISA, with respect to any Plan unless the 30-day
notice requirement with respect to such event has been waived by the PBGC, or
(ii) the requirements of subsection (1) of Section 4043(b) of ERISA (without
regard to subsection (2) of such Section) are met with respect to a contributing
sponsor, as defined in Section 4001(a)(13) of ERISA, of a Plan, and an event
described in paragraph (9), (10), (11), (12) or (13) of Section 4043(c) of ERISA
is reasonably expected to occur with respect to such Plan within the following
30 days; (b) the application for a minimum funding waiver with respect to a
Plan; (c) the provision by the administrator of any Plan of a notice of intent
to terminate such Plan pursuant to Section 4041(a)(2) of ERISA (including any
such notice with respect to a plan amendment referred to in Section 4041(e) of
ERISA); (d) the cessation of operations at a facility of the Borrower or any
ERISA Affiliate in the circumstances described in Section 4062(e) of ERISA;
(e) the withdrawal by the Borrower or any ERISA Affiliate from a Multiple
Employer Plan during a plan year for which it was a substantial employer, as
defined in Section 4001(a)(2) of ERISA; (f) the conditions for the imposition of
a lien under Section 302(f) of ERISA shall have been met with respect to any
Plan; (g) the adoption of an amendment to a Plan requiring the provision of
security to such Plan pursuant to Section 307 of ERISA; or (h) the institution
by the PBGC of proceedings to terminate a Plan pursuant to Section 4042 of
ERISA, or the occurrence of any event or condition described in Section 4042 of
ERISA that constitutes grounds for the termination of, or the appointment of a
trustee to administer, a Plan.

"Eurocurrency Liabilities" has the meaning assigned to that term in Regulation D
of the Board of Governors of the Federal Reserve System, as in effect from time
to time.

"Eurodollar Lending Office" means, with respect to any Lender, the office of
such Lender specified as its "Eurodollar Lending Office" opposite its name on
Schedule I hereto or in the Assignment and Acceptance pursuant to which it
became a Lender (or, if no such office is specified, its Domestic Lending
Office), or such other office of such Lender as such Lender may from time to
time specify to the Borrower and the Agent.

"Eurodollar Rate" means, for any Interest Period for each Eurodollar Rate
Advance comprising part of the same Borrowing, an interest rate per annum equal
to the rate per annum obtained by dividing (a) the rate per annum (rounded
upward to the nearest whole multiple of 1/16 of 1% per annum) appearing on
Telerate Markets Page 3750 (or any successor page) as the London interbank
offered rate for deposits in U.S. dollars at approximately 11:00 A.M. (London
time) two Business Days prior to the first day of such Interest Period for a
term comparable to such Interest Period or, if for any reason such rate is not
available, the average (rounded upward to the nearest whole multiple of 1/16 of
1% per annum, if such average is not such a multiple) of the rate per annum at
which deposits in U.S. dollars is offered by the principal office of each of the
Reference Banks in London, England to prime banks in the London interbank market
at 11:00 A.M. (London time) two Business Days before the first day of such
Interest Period in an amount substantially equal to such Reference Bank's
Eurodollar Rate Advance comprising part of such Borrowing to be outstanding
during such Interest Period and for a period equal to such Interest Period
(subject, however, to the provisions of Section 2.07) by (b) a percentage equal
to 100% minus the Eurocurrency Rate Reserve Percentage for such Interest Period.

"Eurodollar Rate Advance" means an Advance that bears interest as provided in
Section 2.06(a)(ii).

"Eurodollar Rate Reserve Percentage" for any Interest Period for all Eurodollar
Rate Advances comprising part of the same Borrowing means the reserve percentage
applicable two Business Days before the first day of such Interest Period under
regulations issued from time to time by the Board of Governors of the Federal
Reserve System (or any successor) for determining the maximum reserve
requirement (including, without limitation, any emergency, supplemental or other
marginal reserve requirement) for a member bank of the Federal Reserve System in
New York City with respect to liabilities or assets consisting of or including
Eurocurrency Liabilities (or with respect to any other category of liabilities
that includes deposits by reference to which the interest rate on Eurodollar
Rate Advances is determined) having a term equal to such Interest Period.

"Events of Default" has the meaning specified in Section 6.01.

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

"GAAP" has the meaning specified in Section 1.03.

"Hazardous Materials" means (a) petroleum and petroleum products, byproducts or
breakdown products, radioactive materials, asbestos-containing materials,
polychlorinated biphenyls and radon gas and (b) any other chemicals, materials
or substances designated, classified or regulated as hazardous or toxic or as a
pollutant or contaminant under any Environmental Law.

"Hedge Agreements" means interest rate swap, cap or collar agreements, interest
rate future or option contracts, currency swap agreements, currency future or
option contracts and other similar agreements.

"Interest Period" means, for each Eurodollar Rate Advance comprising part of the
same Borrowing, the period from the date of such Eurodollar Rate Advance or the
date of the Conversion of any Base Rate Advance into such Eurodollar Rate
Advance until the last day of the period selected by the Borrower pursuant to
the provisions below and, thereafter, each subsequent period commencing on the
last day of the immediately preceding Interest Period and ending on the last day
of the period selected by the Borrower pursuant to the provisions below. The
duration of each such Interest Period shall be one, two, three or six months or
if available from all Lenders, nine or twelve months, as the Borrower may, upon
notice received by the Agent not later than 11:00 A.M. (New York City time) on
the third Business Day prior to the first day of such Interest Period, select;
provided, however, that:

(i)

the Borrower may not select any Interest Period that ends after the Termination
Date;

(ii)

Interest Periods commencing on the same date for Eurodollar Rate Advances
comprising part of the same Borrowing shall be of the same duration;

(iii)

whenever the last day of any Interest Period would otherwise occur on a day
other than a Business Day, the last day of such Interest Period shall be
extended to occur on the next succeeding Business Day, provided, however, that,
if such extension would cause the last day of such Interest Period to occur in
the next following calendar month, the last day of such Interest Period shall
occur on the next preceding Business Day; and

(iv)

whenever the first day of any Interest Period occurs on a day of an initial
calendar month for which there is no numerically corresponding day in the
calendar month that succeeds such initial calendar month by the number of months
equal to the number of months in such Interest Period, such Interest Period
shall end on the last Business Day of such succeeding calendar month.

"Internal Revenue Code" means the Internal Revenue Code of 1986, as amended from
time to time, and the regulations promulgated and rulings issued thereunder.

"Lenders" means the Initial Lenders and each Person that shall become a party
hereto pursuant to Section 8.07.

"Lien" means any lien, security interest or other charge or encumbrance of any
kind, or any other type of preferential arrangement, including, without
limitation, the lien or retained security title of a conditional vendor and any
easement, right of way or other encumbrance on title to real property.

"Material Adverse Change" means any material adverse change in the business,
condition (financial or otherwise), operations, performance, properties or
prospects of the Borrower or the Borrower and its Subsidiaries taken as a whole.

"Material Adverse Effect" means a material adverse effect on (a) the business,
condition (financial or otherwise), operations, performance, properties or
prospects of the Borrower or the Borrower and its Subsidiaries taken as a whole,
(b) the rights and remedies of the Agent or any Lender under this Agreement or
any Note or (c) the ability of the Borrower to perform its obligations under
this Agreement or any Note.

"Material Subsidiary" of the Borrower means, at any time, any Subsidiary of the
Borrower having (a) Consolidated assets with a value of not less than 5% of the
total value of the Consolidated assets of the Borrower and it Subsidiaries or
(b) Consolidated sales of not less than 5% of the Consolidated sales of the
Borrower and its Subsidiaries, in each case as of the end of or from the most
recently completed fiscal quarter of the Borrower.

"Moody's" means Moody's Investors Service, Inc.

"Multiemployer Plan" means a multiemployer plan, as defined in
Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate is
making or accruing an obligation to make contributions, or has within any of the
preceding five plan years made or accrued an obligation to make contributions.

"Multiple Employer Plan" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of the
Borrower or any ERISA Affiliate and at least one Person other than the Borrower
and the ERISA Affiliates or (b) was so maintained and in respect of which the
Borrower or any ERISA Affiliate could have liability under Section 4064 or 4069
of ERISA in the event such plan has been or were to be terminated.

"Note" means a promissory note of the Borrower payable to the order of any
Lender, delivered pursuant to a request made under Section 2.16 in substantially
the form of Exhibit A hereto, evidencing the aggregate indebtedness of the
Borrower to such Lender resulting from the Advances made by such Lender.

"Notice of Borrowing" has the meaning specified in Section 2.02.

"PBGC" means the Pension Benefit Guaranty Corporation (or any successor).

"Permitted Liens" means such of the following as to which no enforcement,
collection, execution, levy or foreclosure proceeding shall have been commenced
or as to which are not being contested by appropriate proceedings with
appropriate reserves: (a) Liens for taxes, assessments and governmental charges
or levies to the extent not required to be paid under Section 5.01(b) hereof;
(b) Liens imposed by law, such as materialmen's, mechanics', carriers',
workmen's and repairmen's Liens and other similar Liens arising in the ordinary
course of business securing obligations that are not overdue for a period of
more than 30 days; (c) pledges or deposits to secure obligations under workers'
compensation laws or similar legislation or to secure public or statutory
obligations or bids or tenders or surety, appeal or performance bonds in the
ordinary course of business; and (d) easements, rights of way and other
encumbrances on title to real property that do not render title to the property
encumbered thereby unmarketable or materially adversely affect the use of such
property for its present purposes.

"Person" means an individual, partnership, corporation (including a business
trust), joint stock company, trust, unincorporated association, joint venture,
limited liability company or other entity, or a government or any political
subdivision or agency thereof.

"Plan" means a Single Employer Plan or a Multiple Employer Plan.

"Public Debt Rating" means, as of any date, the lowest rating that has been most
recently announced by either S&P or Moody's, as the case may be, for any class
of non-credit enhanced long-term senior unsecured debt issued by the Borrower.
For purposes of the foregoing, (a) if only one of S&P and Moody's shall have in
effect a Public Debt Rating, the Applicable Margin and the Applicable Percentage
shall be determined by reference to the available rating; (b) if neither S&P nor
Moody's shall have in effect a Public Debt Rating, the Applicable Margin and the
Applicable Percentage will be set in accordance with Level 4 under the
definition of "Applicable Margin" or "Applicable Percentage", as the case may
be; (c)  if any rating established by S&P or Moody's shall be changed, such
change shall be effective as of the date on which such change is first announced
publicly by the rating agency making such change; and (d) if S&P or Moody's
shall change the basis on which ratings are established, each reference to the
Public Debt Rating announced by S&P or Moody's, as the case may be, shall refer
to the then equivalent rating by S&P or Moody's, as the case may be.

"Reference Banks" means Citibank, Fleet National Bank and The Chase Manhattan
Bank.

"Register" has the meaning specified in Section 8.07(c).

"Required Lenders" means at any time Lenders owed at least 60% of the then
aggregate unpaid principal amount of the Advances owing to Lenders, or, if no
such principal amount is then outstanding, Lenders having at least 60% of the
Commitments.

"S&P" means Standard & Poor's, a division of The McGraw-Hill Companies, Inc.

"Single Employer Plan" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of the
Borrower or any ERISA Affiliate and no Person other than the Borrower and the
ERISA Affiliates or (b) was so maintained and in respect of which the Borrower
or any ERISA Affiliate could have liability under Section 4069 of ERISA in the
event such plan has been or were to be terminated.

"SPC" has the meaning specified in Section 8.07(f) hereto.

"Subsidiary" of any Person means any corporation, partnership, joint venture,
limited liability company, trust or estate of which (or in which) more than 50%
of (a) the issued and outstanding capital stock having ordinary voting power to
elect a majority of the Board of Directors of such corporation (irrespective of
whether at the time capital stock of any other class or classes of such
corporation shall or might have voting power upon the occurrence of any
contingency), (b) the interest in the capital or profits of such limited
liability company, partnership or joint venture or (c) the beneficial interest
in such trust or estate is at the time directly or indirectly owned or
controlled by such Person, by such Person and one or more of its other
Subsidiaries or by one or more of such Person's other Subsidiaries.

"Termination Date" means the earlier of January 19, 2004 and the date of
termination in whole of the Commitments pursuant to Section 2.04 or 6.01.

"Voting Stock" means capital stock issued by a corporation, or equivalent
interests in any other Person, the holders of which are ordinarily, in the
absence of contingencies, entitled to vote for the election of directors (or
persons performing similar functions) of such Person, even if the right so to
vote has been suspended by the happening of such a contingency.

SECTION 1.02   Computation of Time Periods   In this Agreement in the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
mean "to but excluding".

SECTION 1.03   Accounting Terms   All accounting terms not specifically defined
herein shall be construed in accordance with generally accepted accounting
principles consistent with those applied in the preparation of the financial
statements referred to in Section 4.01(e) ("GAAP").

ARTICLE II

AMOUNTS AND TERMS OF THE ADVANCES

SECTION 2.01   The Advances   Each Lender severally agrees, on the terms and
conditions hereinafter set forth, to make Advances to the Borrower from time to
time on any Business Day during the period from the Effective Date until the
Termination Date in an aggregate amount not to exceed at any time outstanding
the amount set forth opposite such Lender's name on the signature pages hereof
or, if such Lender has entered into any Assignment and Acceptance, set forth for
such Lender in the Register maintained by the Agent pursuant to Section 8.07(c),
as such amount may be reduced pursuant to Section 2.04 (such Lender's
"Commitment"). Each Borrowing shall be in an aggregate amount of $5,000,000 or
an integral multiple of $1,000,000 in excess thereof and shall consist of
Advances of the same Type made on the same day by the Lenders ratably according
to their respective Commitments. Within the limits of each Lender's Commitment,
the Borrower may borrow under this Section 2.01, prepay pursuant to Section 2.09
and reborrow under this Section 2.01.

SECTION 2.02   Making the Advances    (a) Each Borrowing shall be made on
notice, given not later than 11:00 A.M. (New York City time) on the third
Business Day prior to the date of the proposed Borrowing in the case of a
Borrowing consisting of Eurodollar Rate Advances, or the date of the proposed
Borrowing in the case of a Borrowing consisting of Base Rate Advances, by the
Borrower to the Agent, which shall give to each Lender prompt notice thereof by
telecopier or telex. Each such notice of a Borrowing (a "Notice of Borrowing")
shall be by telephone, confirmed immediately in writing, or telecopier or telex,
in substantially the form of Exhibit B hereto, specifying therein the requested
(i) date of such Borrowing, (ii) Type of Advances comprising such Borrowing,
(iii) aggregate amount of such Borrowing, and (iv) in the case of a Borrowing
consisting of Eurodollar Rate Advances, initial Interest Period for each such
Advance. Each Lender shall, before 1:00 P.M. (New  York City time) on the date
of such Borrowing, make available for the account of its Applicable Lending
Office to the Agent at the Agent's Account, in same day funds, such Lender's
ratable portion of such Borrowing. After the Agent's receipt of such funds and
upon fulfillment of the applicable conditions set forth in Article III, the
Agent will make such funds available to the Borrower at the Agent's address
referred to in Section 8.02.

(b)

Anything in subsection (a) above to the contrary notwithstanding, (i) the
Borrower may not select Eurodollar Rate Advances for any Borrowing if the
aggregate amount of such Borrowing is less than $5,000,000 or if the obligation
of the Lenders to make Eurodollar Rate Advances shall then be suspended pursuant
to Section 2.07 or 2.11 and (ii) the Eurodollar Rate Advances may not be
outstanding as part of more than twelve separate Borrowings.

(c)

Each Notice of Borrowing shall be irrevocable and binding on the Borrower. In
the case of any Borrowing that the related Notice of Borrowing specifies is to
be comprised of Eurodollar Rate Advances, the Borrower shall indemnify each
Lender against any loss, cost or expense incurred by such Lender as a result of
any failure to fulfill on or before the date specified in such Notice of
Borrowing for such Borrowing the applicable conditions set forth in Article III,
including, without limitation, any loss, cost or expense incurred by reason of
the liquidation or reemployment of deposits or other funds acquired by such
Lender to fund the Advance to be made by such Lender as part of such Borrowing
when such Advance, as a result of such failure, is not made on such date. Such
indemnification shall be paid upon presentation to the Borrower of a reasonably
detailed statement of such loss, cost or expense certified by an officer of such
Lender.

(d)

Unless the Agent shall have received notice from a Lender prior to the date of
any Borrowing that such Lender will not make available to the Agent such
Lender's ratable portion of such Borrowing, the Agent may assume that such
Lender has made such portion available to the Agent on the date of such
Borrowing in accordance with subsection (a) of this Section 2.02 and the Agent
may, in reliance upon such assumption, make available to the Borrower on such
date a corresponding amount. If and to the extent that such Lender shall not
have so made such ratable portion available to the Agent, such Lender and the
Borrower severally agree to repay to the Agent forthwith on demand such
corresponding amount together with interest thereon, for each day from the date
such amount is made available to the Borrower until the date such amount is
repaid to the Agent, at (i) in the case of the Borrower, the interest rate
applicable at the time to Advances comprising such Borrowing and (ii) in the
case of such Lender, the Federal Funds Rate. If such Lender shall repay to the
Agent such corresponding amount, such amount so repaid shall constitute such
Lender's Advance as part of such Borrowing for purposes of this Agreement.

(e)

The failure of any Lender to make the Advance to be made by it as part of any
Borrowing shall not relieve any other Lender of its obligation, if any,
hereunder to make its Advance on the date of such Borrowing, but no Lender shall
be responsible for the failure of any other Lender to make the Advance to be
made by such other Lender on the date of any Borrowing.

SECTION 2.03   Fees    (a) Facility Fee. The Borrower agrees to pay to the Agent
for the account of each Lender a facility fee on the aggregate amount of such
Lender's Commitment from the Effective Date in the case of each Initial Lender
and from the effective date specified in the Assignment and Acceptance pursuant
to which it became a Lender in the case of each other Lender until the
Termination Date at a rate per annum equal to the Applicable Percentage in
effect from time to time, payable in arrears quarterly on the last day of each
March, June, September and December, commencing March 31, 2001, and on the
Termination Date.

(b)

Agent's Fees

. The Borrower shall pay to the Agent for its own account such fees as have been
agreed between the Borrower and the Agent.

SECTION 2.04   Termination or Reduction of the Commitments   The Borrower shall
have the right, upon at least three Business Days' notice to the Agent, to
terminate in whole or permanently reduce ratably in part the unused portions of
the respective Commitments of the Lenders, provided that each partial reduction
shall be in the aggregate amount of $5,000,000 or an integral multiple of
$1,000,000 in excess thereof.

SECTION 2.05   Repayment   The Borrower shall repay to the Agent for the ratable
account of the Lenders on the Termination Date the aggregate principal amount of
the Advances then outstanding.

SECTION 2.06   Interest    (a) Scheduled Interest. The Borrower shall pay
interest on the unpaid principal amount of each Advance owing to each Lender
from the date of such Advance until such principal amount shall be paid in full,
at the following rates per annum:

(i)

Base Rate Advances

. During such periods as such Advance is a Base Rate Advance, a rate per annum
equal at all times to the sum of (x) the Base Rate in effect from time to time
plus (y) the Applicable Margin in effect from time to time, payable in arrears
quarterly on the last day of each March, June, September and December during
such periods and on the date such Base Rate Advance shall be Converted or paid
in full.

(ii)

Eurodollar Rate Advances

. During such periods as such Advance is a Eurodollar Rate Advance, a rate per
annum equal at all times during each Interest Period for such Advance to the sum
of (x) the Eurodollar Rate for such Interest Period for such Advance plus
(y) the Applicable Margin in effect from time to time, payable in arrears on the
last day of such Interest Period and, if such Interest Period has a duration of
more than three months, on each day that occurs during such Interest Period
every three months from the first day of such Interest Period and on the date
such Eurodollar Rate Advance shall be Converted or paid in full.

(b)

Default Interest

. Upon the occurrence and during the continuance of an Event of Default, the
Borrower shall pay interest on (i) the unpaid principal amount of each Advance
owing to each Lender, payable in arrears on the dates referred to in
clause (a)(i) or (a)(ii) above, at a rate per annum equal at all times to 2% per
annum above the rate per annum required to be paid on such Advance pursuant to
clause (a)(i) or (a)(ii) above and (ii) to the fullest extent permitted by law,
the amount of any interest, fee or other amount payable hereunder that is not
paid when due, from the date such amount shall be due until such amount shall be
paid in full, payable in arrears on the date such amount shall be paid in full
and on demand, at a rate per annum equal at all times to 2% per annum above the
rate per annum required to be paid on Base Rate Advances pursuant to
clause (a)(i) above.

SECTION 2.07   Interest Rate Determination    (a) Each Reference Bank agrees to
furnish to the Agent timely information for the purpose of determining each
Eurodollar Rate. If any one or more of the Reference Banks shall not furnish
such timely information to the Agent for the purpose of determining any such
interest rate, the Agent shall determine such interest rate on the basis of
timely information furnished by the remaining Reference Banks. The Agent shall
give prompt notice to the Borrower and the Lenders of the applicable interest
rate determined by the Agent for purposes of Section 2.06(a)(i) or (ii) and the
rate, if any, furnished by each Reference Bank for the purpose of determining
the interest rate under Section 2.06(a)(ii).

(b)

If, with respect to any Eurodollar Rate Advances, the Required Lenders notify
the Agent that the Eurodollar Rate for any Interest Period for such Advances
will not adequately reflect the cost to such Required Lenders of making, funding
or maintaining their respective Eurodollar Rate Advances for such Interest
Period, the Agent shall forthwith so notify the Borrower and the Lenders,
whereupon (i) each Eurodollar Rate Advance will automatically, on the last day
of the then existing Interest Period therefor, Convert into a Base Rate Advance,
and (ii) the obligation of the Lenders to make, or to Convert Advances into,
Eurodollar Rate Advances shall be suspended until the Agent shall notify the
Borrower and the Lenders that the circumstances causing such suspension no
longer exist.

(c)

If the Borrower shall fail to select the duration of any Interest Period for any
Eurodollar Rate Advances in accordance with the provisions contained in the
definition of "Interest Period" in Section 1.01, the Agent will forthwith so
notify the Borrower and the Lenders and such Advances will automatically, on the
last day of the then existing Interest Period therefor, Convert into Base Rate
Advances.

(d)

On the date on which the aggregate unpaid principal amount of Eurodollar Rate
Advances comprising any Borrowing shall be reduced, by payment or prepayment or
otherwise, to less than $5,000,000, such Advances shall automatically Convert
into Base Rate Advances.

(e)

Upon the occurrence and during the continuance of any Event of Default, (i) each
Eurodollar Rate Advance will automatically, on the last day of the then existing
Interest Period therefor, Convert into a Base Rate Advance and (ii) the
obligation of the Lenders to make, or to Convert Advances into, Eurodollar Rate
Advances shall be suspended.

(f)

If Telerate Markets Page 3750 is unavailable and fewer than two Reference Banks
furnish timely information to the Agent for determining the Eurodollar Rate for
any Eurodollar Rate Advances,

(i)

the Agent shall forthwith notify the Borrower and the Lenders that the interest
rate cannot be determined for such Eurodollar Rate Advances,

(ii)

each such Advance will automatically, on the last day of the then existing
Interest Period therefor, Convert into a Base Rate Advance (or if such Advance
is then a Base Rate Advance, will continue as a Base Rate Advance), and

(iii)

the obligation of the Lenders to make, or to Convert Advances into, Eurodollar
Rate Advances shall be suspended until the Agent shall notify the Borrower and
the Lenders that the circumstances causing such suspension

SECTION 2.08   Optional Conversion of Advances   The Borrower may on any
Business Day, upon notice given to the Agent not later than 11:00 A.M. (New York
City time) on the third Business Day prior to the date of the proposed
Conversion and subject to the provisions of Sections 2.07 and 2.11, Convert all
Advances of one Type comprising the same Borrowing into Advances of the other
Type; provided, however, that any Conversion of Eurodollar Rate Advances into
Base Rate Advances shall be made only on the last day of an Interest Period for
such Eurodollar Rate Advances, any Conversion of Base Rate Advances into
Eurodollar Rate Advances shall be in an amount not less than the minimum amount
specified in Section 2.02(b) and no Conversion of any Advances shall result in
more separate Borrowings than permitted under Section 2.02(b). Each such notice
of a Conversion shall, within the restrictions specified above, specify (i) the
date of such Conversion, (ii) the Advances to be Converted, and (iii) if such
Conversion is into Eurodollar Rate Advances, the duration of the initial
Interest Period for each such Advance. Each notice of Conversion shall be
irrevocable and binding on the Borrower.

SECTION 2.09   Optional Prepayments   The Borrower may, upon notice at least two
Business Days' prior to the date of such prepayment, in the case of Eurodollar
Rate Advances, and not later than 11:00 A.M. (New York City time) on the date of
such prepayment, in the case of Base Rate Advances, to the Agent stating the
proposed date and aggregate principal amount of the prepayment, and if such
notice is given the Borrower shall, prepay the outstanding principal amount of
the Advances comprising part of the same Borrowing in whole or ratably in part,
together with accrued interest to the date of such prepayment on the principal
amount prepaid; provided, however, that (x) each partial prepayment shall be in
an aggregate principal amount of $5,000,000 or an integral multiple of
$1,000,000 in excess thereof and (y) in the event of any such prepayment of a
Eurodollar Rate Advance, the Borrower shall be obligated to reimburse the
Lenders in respect thereof pursuant to Section 8.04(c).

SECTION 2.10   Increased Costs   (a) If, due to either (i) the introduction of
or any change in or in the interpretation of any law or regulation or (ii) the
compliance with any guideline or request from any central bank or other
governmental authority (whether or not having the force of law), there shall be
any increase in the cost to any Lender of agreeing to make or making, funding or
maintaining Eurodollar Rate Advances (excluding for purposes of this Section
2.10 any such increased costs resulting from (i) Taxes or Other Taxes (as to
which Section 2.13 shall govern) and (ii) changes in the basis of taxation of
overall net income or overall gross income by the United States or by the
foreign jurisdiction or state under the laws of which such Lender is organized
or has its Applicable Lending Office or any political subdivision thereof), then
the Borrower shall from time to time, upon demand by such Lender (with a copy of
such demand to the Agent), pay to the Agent for the account of such Lender
additional amounts sufficient to compensate such Lender for such increased cost.
A certificate as to the amount of such increased cost, submitted to the Borrower
and the Agent by an authorized officer of such Lender, shall be conclusive and
binding for all purposes, absent manifest error.

(b)

If any Lender determines that compliance with any law or regulation or any
guideline or request from any central bank or other governmental authority
(whether or not having the force of law) affects or would affect the amount of
capital required or expected to be maintained by such Lender or any corporation
controlling such Lender and that the amount of such capital is increased by or
based upon the existence of such Lender's commitment to lend hereunder and other
commitments of this type, then, upon demand by such Lender (with a copy of such
demand to the Agent), the Borrower shall pay to the Agent for the account of
such Lender, from time to time as specified by such Lender, additional amounts
sufficient to compensate such Lender or such corporation in the light of such
circumstances, to the extent that such Lender reasonably determines such
increase in capital to be allocable to the existence of such Lender's commitment
to lend hereunder. A certificate as to such amounts submitted to the Borrower
and the Agent by an authorized officer of such Lender shall be conclusive and
binding for all purposes, absent manifest error.

SECTION 2.11   Il1egality   Notwithstanding any other provision of this
Agreement, if any Lender shall notify the Agent that the introduction of or any
change in or in the interpretation of any law or regulation makes it unlawful,
or any central bank or other governmental authority asserts that it is unlawful,
for any Lender or its Eurodollar Lending Office to perform its obligations
hereunder to make Eurodollar Rate Advances or to fund or maintain Eurodollar
Rate Advances hereunder, (i) each Eurodollar Rate Advance will automatically,
upon such demand, Convert into a Base Rate Advance and (ii) the obligation of
the Lenders to make, or to Convert Advances into, Eurodollar Rate Advances shall
be suspended until the Agent shall notify the Borrower and the Lenders that the
circumstances causing such suspension no longer exist.

SECTION 2.12   Payments and Computations   (a) The Borrower shall make each
payment hereunder and under the Notes, irrespective of any right of counterclaim
or set-off, not later than 11:00 A.M. (New York City time) on the day when due
in U.S. dollars to the Agent at the Agent's Account in same day funds. The Agent
will promptly thereafter cause to be distributed like funds relating to the
payment of principal or interest or facility fees ratably (other than amounts
payable pursuant to Section 2.10, 2.13 or 8.04(c)) to the Lenders for the
account of their respective Applicable Lending Offices, and like funds relating
to the payment of any other amount payable to any Lender to such Lender for the
account of its Applicable Lending Office, in each case to be applied in
accordance with the terms of this Agreement. Upon its acceptance of an
Assignment and Acceptance and recording of the information contained therein in
the Register pursuant to Section 8.07(d), from and after the effective date
specified in such Assignment and Acceptance, the Agent shall make all payments
hereunder and under the Notes in respect of the interest assigned thereby to the
Lender assignee thereunder, and the parties to such Assignment and Acceptance
shall make all appropriate adjustments in such payments for periods prior to
such effective date directly between themselves.

(b)

The Borrower hereby authorizes each Lender, if and to the extent payment owed to
such Lender is not made when due hereunder or under the Note held by such
Lender, to charge from time to time against any or all of the Borrower's
accounts with such Lender any amount so due.

(c)

All computations of interest based on the Base Rate shall be made by the Agent
on the basis of a year of 365 or 366 days, as the case may be, and all
computations of interest based on the Eurodollar Rate or the Federal Funds Rate
and of facility fees shall be made by the Agent on the basis of a year of 360
days, in each case for the actual number of days (including the first day but
excluding the last day) occurring in the period for which such interest or
facility fees are payable. Each determination by the Agent of an interest rate
hereunder shall be conclusive and binding for all purposes, absent manifest
error.

(d)

Whenever any payment hereunder or under the Notes shall be stated to be due on a
day other than a Business Day, such payment shall be made on the next succeeding
Business Day, and such extension of time shall in such case be included in the
computation of payment of interest or facility fee, as the case may be;
provided, however, that, if such extension would cause payment of interest on or
principal of Eurodollar Rate Advances to be made in the next following calendar
month, such payment shall be made on the next preceding Business Day.

(e)

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

SECTION 2.13   Taxes   (a) Any and all payments by the Borrower hereunder or
under the Notes shall be made, in accordance with Section 2.12, free and clear
of and without deduction for any and all present or future taxes, levies,
imposts, deductions, charges or withholdings, and all liabilities with respect
thereto, excluding, in the case of each Lender and the Agent, taxes imposed on
its overall net income, and franchise taxes imposed on it in lieu of net income
taxes, by the jurisdiction under the laws of which such Lender or the Agent (as
the case may be) is organized or any political subdivision thereof and, in the
case of each Lender, taxes imposed on its overall net income, and franchise
taxes imposed on it in lieu of net income taxes, by the jurisdiction of such
Lender's Applicable Lending Office or any political subdivision thereof (all
such non-excluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities in respect of payments hereunder or under the Notes being
hereinafter referred to as "Taxes"). If the Borrower shall be required by law to
deduct any Taxes from or in respect of any sum payable hereunder or under any
Note to any Lender or the Agent, (i) the sum payable shall be increased as may
be necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section 2.13) such Lender or
the Agent (as the case may be) receives an amount equal to the sum it would have
received had no such deductions been made, (ii) the Borrower shall make such
deductions and (iii) the Borrower shall pay the full amount deducted to the
relevant taxation authority or other authority in accordance with applicable
law.

(b)

In addition, the Borrower shall pay any present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies that
arise from any payment made hereunder or under the Notes or from the execution,
delivery or registration of, performing under, or otherwise with respect to,
this Agreement or the Notes (hereinafter referred to as "Other Taxes").

(c)

The Borrower shall indemnify each Lender and the Agent for and hold it harmless
against the full amount of Taxes or Other Taxes (including, without limitation,
taxes of any kind imposed by any jurisdiction on amounts payable under this
Section 2.13) imposed on or paid by such Lender or the Agent (as the case may
be) and any liability (including penalties, interest and expenses) arising
therefrom or with respect thereto. This indemnification shall be made within 30
days from the date such Lender or the Agent (as the case may be) makes written
demand therefor.

(d)

Within 30 days after the date of any payment of Taxes, the Borrower shall
furnish to the Agent, at its address referred to in Section 8.02, the original
or a certified copy of a receipt evidencing such payment. In the case of any
payment hereunder or under the Notes by or on behalf of the Borrower through an
account or branch outside the United States or by or on behalf of the Borrower
by a payor that is not a United States person, if the Borrower determines that
no Taxes are payable in respect thereof, the Borrower shall furnish, or shall
cause such payor to furnish, to the Agent, at such address, an opinion of
counsel acceptable to the Agent stating that such payment is exempt from Taxes.
For purposes of this subsection (d) and subsection (e), the terms "United
States" and "United States person" shall have the meanings specified in
Section 7701 of the Internal Revenue Code.

(e)

Each Lender organized under the laws of a jurisdiction outside the United
States, on or prior to the date of its execution and delivery of this Agreement
in the case of each Initial Lender and on the date of the Assignment and
Acceptance pursuant to which it becomes a Lender in the case of each other
Lender, and from time to time thereafter as requested in writing by the Borrower
(but only so long as such Lender remains lawfully able to do so), shall provide
each of the Agent and the Borrower with two original Internal Revenue Service
forms W-8BEN or W-8ECI, as appropriate, or any successor or other form
prescribed by the Internal Revenue Service, certifying that such Lender is
exempt from or entitled to a reduced rate of United States withholding tax on
payments pursuant to this Agreement or the Notes. If the form provided by a
Lender at the time such Lender first becomes a party to this Agreement indicates
a United States interest withholding tax rate in excess of zero, withholding tax
at such rate shall be considered excluded from Taxes unless and until such
Lender provides the appropriate forms certifying that a lesser rate applies,
whereupon withholding tax at such lesser rate only shall be considered excluded
from Taxes for periods governed by such form; provided, however, that, if at the
date of the Assignment and Acceptance pursuant to which a Lender assignee
becomes a party to this Agreement, the Lender assignor was entitled to payments
under subsection (a) in respect of United States withholding tax with respect to
interest paid at such date, then, to such extent, the term Taxes shall include
(in addition to withholding taxes that may be imposed in the future or other
amounts otherwise includable in Taxes) United States withholding tax, if any,
applicable with respect to the Lender assignee on such date. If any form or
document referred to in this subsection (e) requires the disclosure of
information, other than information necessary to compute the tax payable and
information required on the date hereof by Internal Revenue Service form W-8BEN
or W-8ECI, that the Lender reasonably considers to be confidential, the Lender
shall give notice thereof to the Borrower and shall not be obligated to include
in such form or document such confidential information.

(f)

For any period with respect to which a Lender has failed to provide the Borrower
with the appropriate form described in Section 2.13(e) (other than if such
failure is due to a change in law occurring subsequent to the date on which a
form originally was required to be provided, or if such form otherwise is not
required under subsection (e) above), such Lender shall not be entitled to
indemnification under Section 2.13(a) or (c) with respect to Taxes imposed by
the United States by reason of such failure; provided, however, that should a
Lender become subject to Taxes because of its failure to deliver a form required
hereunder, the Borrower shall take such steps as the Lender shall reasonably
request to assist the Lender to recover such Taxes.

(g)

Any Lender claiming any additional amounts payable pursuant to this Section 2.13
agrees to use reasonable efforts (consistent with its internal policy and legal
and regulatory restrictions) to change the jurisdiction of its Eurodollar
Lending Office if the making of such a change would avoid the need for, or
reduce the amount of, any such additional amounts that may thereafter accrue and
would not, in the reasonable judgment of such Lender, be otherwise
disadvantageous to such Lender.

(h)

If any Lender determines, in its sole discretion, that it has actually and
finally realized, by reason of a refund, deduction or credit of any Taxes paid
or reimbursed by the Borrower pursuant to subsection (a) or (c) above in respect
of payments under the Credit Agreement or the Notes, a current monetary benefit
that it would otherwise not have obtained, and that would result in the total
payments under this Section 2.13 exceeding the amount needed to make such Lender
whole, such Lender shall pay to the Borrower, with reasonable promptness
following the date on which it actually realizes such benefit, an amount equal
to the lesser of the amount of such benefit or the amount of such excess, in
each case net of all out-of-pocket expenses in securing such refund, deduction
or credit.

SECTION 2.14   Sharing of Payments, Etc   If any Lender shall obtain any payment
(whether voluntary, involuntary, through the exercise of any right of set-off,
or otherwise) on account of the Advances owing to it (other than pursuant to
Section 2.10, 2.13 or 8.04(c)) in excess of its ratable share of payments on
account of the Advances obtained by all the Lenders, such Lender shall forthwith
purchase from the other Lenders such participations in the Advances owing to
them as shall be necessary to cause such purchasing Lender to share the excess
payment ratably with each of them; provided, however, that if all or any portion
of such excess payment is thereafter recovered from such purchasing Lender, such
purchase from each Lender shall be rescinded and such Lender shall repay to the
purchasing Lender the purchase price to the extent of such recovery together
with an amount equal to such Lender's ratable share (according to the proportion
of (i) the amount of such Lender's required repayment to (ii) the total amount
so recovered from the purchasing Lender) of any interest or other amount paid or
payable by the purchasing Lender in respect of the total amount so recovered.
The Borrower agrees that any Lender so purchasing a participation from another
Lender pursuant to this Section 2.14 may, to the fullest extent permitted by
law, exercise all its rights of payment (including the right of set-off) with
respect to such participation as fully as if such Lender were the direct
creditor of the Borrower in the amount of such participation.

SECTION 2.15   Use of Proceeds   The proceeds of the Advances shall be available
(and the Borrower agrees that it shall use such proceeds) solely for general
corporate purposes of the Borrower and its Subsidiaries, including acquisitions.

SECTION 2.16   Evidence of Debt   (a) Each Lender shall maintain in accordance
with its usual practice an account or accounts evidencing the indebtedness of
the Borrower to such Lender resulting from each Advance owing to such Lender
from time to time, including the amounts of principal and interest payable and
paid to such Lender from time to time hereunder in respect of Advances. The
Borrower agrees that upon notice by any Lender to the Borrower (with a copy of
such notice to the Agent) to the effect that a Note is required or appropriate
in order for such Lender to evidence (whether for purposes of pledge,
enforcement or otherwise) the Advances owing to, or to be made by, such Lender,
the Borrower shall promptly execute and deliver to such Lender a Note payable to
the order of such Lender in a principal amount up to the Commitment of such
Lender.

(b)

The Register maintained by the Agent pursuant to Section 8.07(d) shall include a
control account, and a subsidiary account for each Lender, in which accounts
(taken together) shall be recorded (I) the date and amount of each Borrowing
made hereunder, the Type of Advances comprising such Borrowing and, if
appropriate, the Interest Period applicable thereto, (ii) the terms of each
Assignment and Acceptance delivered to and accepted by it, (iii) the amount of
any principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder and (iv) the amount of any sum received by the
Agent from the Borrower hereunder and each Lender's share thereof.

(c)

Entries made in good faith by the Agent in the Register pursuant to subsection
(b) above, and by each Lender in its account or accounts pursuant to subsection
(a) above, shall be prima facie evidence of the amount of principal and interest
due and payable or to become due and payable from the Borrower to, in the case
of the Register, each Lender and, in the case of such account or accounts, such
Lender, under this Agreement, absent manifest error; provided, however, that the
failure of the Agent or such Lender to make an entry, or any finding that an
entry is incorrect, in the Register or such account or accounts shall not limit
or otherwise affect the obligations of the Borrower under this Agreement.

ARTICLE III

CONDITIONS TO EFFECTIVENESS AND LENDING

SECTION 3.01   Conditions Precedent to Effectiveness of Section
2.01   Section 2.01 of this Agreement shall become effective on and as of the
first date (the "Effective Date") on which the following conditions precedent
have been satisfied:

 

(a)

Other than as publicly disclosed prior to the Effective Date, there shall have
occurred no Material Adverse Change since December 25, 1999.

(b)

There shall exist no action, suit, investigation, litigation or proceeding
affecting the Borrower or any of its Subsidiaries pending or threatened before
any court, governmental agency or arbitrator that (i) could be reasonably likely
to have a Material Adverse Effect other than the matters described on
Schedule 3.01(b) hereto (the "Disclosed Litigation") or (ii) purports to affect
the legality, validity or enforceability of this Agreement or any Note or the
consummation of the transactions contemplated hereby, and there shall have been
no adverse change in the status, or financial effect on the Borrower or any of
its Subsidiaries, of the Disclosed Litigation from that described on
Schedule 3.01(b) hereto.

(c)

The Lenders shall have been given such access to the management, records, books
of account, contracts and properties of the Borrower and its Subsidiaries as
they shall have requested.

(d)

All governmental and third party consents and approvals necessary in connection
with the transactions contemplated hereby shall have been obtained (without the
imposition of any conditions that are not acceptable to the Lenders) and shall
remain in effect, and no law or regulation shall be applicable in the reasonable
judgment of the Lenders that restrains, prevents or imposes materially adverse
conditions upon the transactions contemplated hereby.

(e)

The Borrower shall have notified the Agent in writing as to the proposed
Effective Date.

(f)

The Borrower shall have paid all accrued and invoiced fees and expenses of the
Agent and the Lenders (including the accrued and invoiced fees and expenses of
counsel to the Agent).

(g)

On the Effective Date, the following statements shall be true and the Agent
shall have received for the account of each Lender a certificate signed by a
duly authorized officer of the Borrower, dated the Effective Date, stating that:

 

(i)

The representations and warranties contained in Section 4.01 are correct on and
as of the Effective Date, and

(ii)

No event has occurred and is continuing that constitutes a Default.

 

(h)

The Agent shall have received on or before the Effective Date the following,
each dated such day, in form and substance satisfactory to the Agent and (except
for the Notes) in sufficient copies for each Lender:

 

 

 

 

(i)

The Notes to the order of the Lenders, to the extent requested pursuant to
Section 2.16.

(ii)

Certified copies of the resolutions of the Board of Directors of the Borrower
approving this Agreement and the Notes, and of all documents evidencing other
necessary corporate action and governmental approvals, if any, with respect to
this Agreement and the Notes.

(iii)

A certificate of the Secretary or an Assistant Secretary of the Borrower
certifying the names and true signatures of the officers of the Borrower
authorized to sign this Agreement and the Notes and the other documents to be
delivered hereunder.

(iv)

A favorable opinion of [Robert Stiles], counsel for the Borrower, substantially
in the form of Exhibit D hereto and as to such other matters as any Lender
through the Agent may reasonably request.

(v)

A favorable opinion of Shearman & Sterling, counsel for the Agent, in form and
substance satisfactory to the Agent.

 

(i)

The Borrower shall have terminated the commitments, and paid in full all Debt,
interest, fees and other amounts outstanding, under all of its bilateral credit
agreements.

SECTION 3.02   Conditions Precedent to Each Borrowing   The obligation of each
Lender to make an Advance on the occasion of each Borrowing shall be subject to
the conditions precedent that the Effective Date shall have occurred and on the
date of such Borrowing (a) the following statements shall be true (and each of
the giving of the applicable Notice of Borrowing and the acceptance by the
Borrower of the proceeds of such Borrowing shall constitute a representation and
warranty by the Borrower that on the date of such Borrowing such statements are
true):

(i)

the representations and warranties contained in Section 4.01 are correct on and
as of the date of such Borrowing, before and after giving effect to such
Borrowing and to the application of the proceeds therefrom, as though made on
and as of such date, and

(ii)

no event has occurred and is continuing, or would result from such Borrowing or
from the application of the proceeds therefrom, that constitutes a Default;

and (b) the Agent shall have received such other approvals, opinions or
documents as any Lender through the Agent may reasonably request.

SECTION 3.03   Determinations Under Section 3.01   For purposes of determining
compliance with the conditions specified in Section 3.01, each Lender shall be
deemed to have consented to, approved or accepted or to be satisfied with each
document or other matter required thereunder to be consented to or approved by
or acceptable or satisfactory to the Lenders unless an officer of the Agent
responsible for the transactions contemplated by this Agreement shall have
received notice from such Lender prior to the date that the Borrower, by notice
to the Lenders, designates as the proposed Effective Date, specifying its
objection thereto. The Agent shall promptly notify the Lenders of the occurrence
of the Effective Date.

ARTICLE IV
REPRESENTATIONS AND WARRANTIES

SECTION 4.01   Representations and Warranties of the Borrower   The Borrower
represents and warrants as follows:

(a)

The Borrower is a corporation duly organized, validly existing and in good
standing under the laws of the State of New York.

(b)

The execution, delivery and performance by the Borrower of this Agreement and
the Notes to be delivered by it, and the consummation of the transactions
contemplated hereby, are within the Borrower's corporate powers, have been duly
authorized by all necessary corporate action, and do not contravene (i) the
Borrower's charter or by-laws or (ii) law or any contractual restriction binding
on or affecting the Borrower.

(c)

No authorization or approval or other action by, and no notice to or filing
with, any governmental authority or regulatory body or any other third party is
required for the due execution, delivery and performance by the Borrower of this
Agreement or the Notes to be delivered by it.

(d)

This Agreement has been, and each of the Notes to be delivered by it when
delivered hereunder will have been, duly executed and delivered by the Borrower.
This Agreement is, and each of the Notes when delivered hereunder will be, the
legal, valid and binding obligation of the Borrower enforceable against the
Borrower in accordance with their respective terms.

(e)

The Consolidated balance sheet of the Borrower and its Subsidiaries as at
December 25, 1999, and the related Consolidated statements of income and cash
flows of the Borrower and its Subsidiaries for the fiscal year then ended,
accompanied by an opinion of PricewaterhouseCoopers, LLP, independent public
accountants, and the Consolidated balance sheet of the Borrower and its
Subsidiaries as at September 23, 2000 and the related Consolidated statements of
income and cash flows of the Borrower and its Subsidiaries for the nine months
then ended, duly certified by the chief financial officer of the Borrower,
copies of which have been furnished to each Lender, fairly present, subject, in
the case of said balance sheet as at September 23, 2000 and said statements of
income and cash flows for the nine months then ended, to year-end audit
adjustments, the Consolidated financial condition of the Borrower and its
Subsidiaries as at such dates and the Consolidated results of the operations of
the Borrower and its Subsidiaries for the periods ended on such dates, all in
accordance with generally accepted accounting principles consistently applied.
Other than as publicly disclosed prior to the Effective Date, since December 25,
1999, there has been no Material Adverse Change.

(f)

There is no pending or threatened action, suit, investigation, litigation or
proceeding, including, without limitation, any Environmental Action, affecting
the Borrower or any of its Subsidiaries before any court, governmental agency or
arbitrator that (i) could be reasonably likely to have a Material Adverse Effect
(other than the Disclosed Litigation) or (ii) purports to affect the legality,
validity or enforceability of this Agreement or any Note or the consummation of
the transactions contemplated hereby, and there has been no adverse change in
the status, or financial effect on the Borrower or any of its Subsidiaries, of
the Disclosed Litigation from that described on Schedule 3.01(b) hereto.

(g)

The Borrower is not engaged in the business of extending credit for the purpose
of purchasing or carrying margin stock (within the meaning of Regulation U
issued by the Board of Governors of the Federal Reserve System), and no proceeds
of any Advance will be used to purchase or carry any margin stock or to extend
credit to others for the purpose of purchasing or carrying any margin stock.

(h)

Each of the Borrower and its Subsidiaries has good title to, or valid leasehold
interests in, all its real and personal property material to its business,
except for defects in title that do not interfere with its ability to conduct
its business as currently conducted or to utilize such properties for their
intended purposes and that, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.

(i)

Each of the Borrower and its Subsidiaries owns, or is licensed to use, all
trademarks, trade names, copyrights, patents and other intellectual property
material to its business, and the use thereof by the Borrower and its
Subsidiaries does not infringe upon the rights of any other Person, except for
any such infringements that, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.

(j)

Schedule 4.01(j) is a complete and correct list of each Lien securing Debt of
any Person outstanding on the date hereof the aggregate principal or face amount
of which equals or exceeds (or may equal or exceed) $10,000,000 and covering any
property of the Borrower or any of its Subsidiaries, and the aggregate Debt
secured (or that may be secured) by each such Lien and the property covered by
each such Lien is correctly described in Schedule 4.01(j).

(k)

Each of the Borrower and its Subsidiaries is in compliance with all laws,
regulations and orders of any governmental authority applicable to it or its
property and all indentures, agreements and other instruments binding upon it or
its property, except where the failure to do so, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.

(l)

Neither the Borrower nor any of its Subsidiaries is (i) an "investment company"
as defined in, or subject to regulation under, the Investment Company Act of
1940 or (ii) a "holding company" as defined in, or subject to regulation under,
the Public Utility Holding Company Act of 1935.

(m)

Each of the Borrower and its Subsidiaries has timely filed or caused to be filed
all tax returns and reports required to have been filed and has paid or caused
to be paid all taxes required to have been filed and has paid or caused to be
paid all taxes required to have been paid by it, except (i) taxes that are being
contested in good faith by appropriate proceedings and for which such Person has
set aside on its books reserves where required by GAAP or (ii) to the extent
that the failure to do so could not reasonably be expected to result in a
Material Adverse Effect.

(n)

Attached hereto a Schedule 4.01(n) is a list of each Material Subsidiary of the
Borrower on the date hereof.

ARTICLE V
COVENANTS OF THE BORROWER

SECTION 5.01   Affirmative Covenants   So long as any Advance shall remain
unpaid or any Lender shall have any Commitment hereunder, the Borrower will:

(a)

Compliance with Laws, Etc

. Comply, and cause each of its Subsidiaries to comply, with all applicable
laws, rules, regulations and orders, such compliance to include, without
limitation, compliance with ERISA and Environmental Laws to the extent that the
failure to do so could reasonably be expected to result in a Material Adverse
Effect.

(b)

Payment of Taxes, Etc

. Pay and discharge, and cause each of its Subsidiaries to pay and discharge,
before the same shall become delinquent, (i) all taxes, assessments and
governmental charges or levies imposed upon it or upon its property and (ii) all
lawful claims that, if unpaid, might by law become a Lien upon its property;
provided, however, that neither the Borrower nor any of its Subsidiaries shall
be required to pay or discharge any such tax, assessment, charge or claim that
is being contested in good faith and by proper proceedings and as to which
appropriate reserves are being maintained, unless and until any Lien resulting
therefrom attaches to its property and enforcement, collection, execution, levy
or foreclosure proceedings shall have been commenced with respect to one or more
such taxes, assessments, charges, levies or claims that, either individually or
in the aggregate, are material.

(c)

Maintenance of Insurance

. Maintain, and cause each of its Subsidiaries to maintain, insurance with
responsible and reputable insurance companies or associations in such amounts
and covering such risks as is usually carried by companies engaged in similar
businesses and owning similar properties in the same general areas in which the
Borrower or such Subsidiary operates.

(d)

Preservation of Corporate Existence, Etc

. Preserve and maintain, and cause each of its Material Subsidiaries to preserve
and maintain, its corporate existence, rights (charter and statutory) and
franchises; provided, however, that the Borrower and its Material Subsidiaries
may consummate any merger or consolidation permitted under Section 5.02(b) and
provided further that neither the Borrower nor any of its Material Subsidiaries
shall be required to preserve any right or franchise if the Board of Directors
of the Borrower or such Subsidiary shall reasonably determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Borrower or such Subsidiary, as the case may be, and that the loss thereof
is not disadvantageous in any material respect to the Borrower, such Subsidiary
or the Lenders.

(e)

Visitation Rights

. At any reasonable time and from time to time, permit the Agent or any of the
Lenders or any agents or representatives thereof, to examine and make copies of
and abstracts from the records and books of account of, and visit the properties
of, the Borrower and any of its Subsidiaries, and to discuss the affairs,
finances and accounts of the Borrower and any of its Subsidiaries with any of
their officers or directors and with their independent certified public
accountants.

(f)

Keeping of Books

. Keep, and cause each of its Material Subsidiaries to keep, proper books of
record and account, in which full and correct entries shall be made of all
financial transactions and the assets and business of the Borrower and each such
Subsidiary in accordance with generally accepted accounting principles in effect
from time to time.

(g)

Maintenance of Properties, Etc.

Maintain and preserve, and cause each of its Material Subsidiaries to maintain
and preserve, all of its properties that are used or useful in the conduct of
its business in good working order and condition, ordinary wear and tear
excepted.

(h)

Reporting Requirements

. Furnish to the Lenders:

 

(i)

as soon as available and in any event within 60 days after the end of each of
the first three quarters of each fiscal year of the Borrower, a Consolidated
balance sheet of the Borrower and its Subsidiaries as of the end of such quarter
and Consolidated statements of income and cash flows of the Borrower and its
Subsidiaries for the period commencing at the end of the previous fiscal year
and ending with the end of such quarter, duly certified (subject to year-end
audit adjustments) by the chief financial officer, treasurer or controller of
the Borrower as having been prepared in accordance with generally accepted
accounting principles and certificates of the chief financial officer, treasurer
or controller of the Borrower as to compliance with the terms of this Agreement
and setting forth in reasonable detail the calculations necessary to demonstrate
compliance with Section 5.03, provided that in the event of any change in GAAP
used in the preparation of such financial statements, the Borrower shall also
provide, if necessary for the determination of compliance with Section 5.03, a
statement of reconciliation conforming such financial statements to GAAP;

(ii)

as soon as available and in any event within 105 days after the end of each
fiscal year of the Borrower, a copy of the audited annual report for such year
for the Borrower and its Subsidiaries, containing a Consolidated balance sheet
of the Borrower and its Subsidiaries as of the end of such fiscal year and
Consolidated statements of income and cash flows of the Borrower and its
Subsidiaries for such fiscal year, in each case accompanied by an opinion
acceptable to the Required Lenders by PricewaterhouseCoopers, LLP or other
independent public accountants acceptable to the Required Lenders, provided that
in the event of any change in GAAP used in the preparation of such financial
statements, the Borrower shall also provide, if necessary for the determination
of compliance with Section 5.03, a statement of reconciliation conforming such
financial statements to GAAP;

(iii)

as soon as possible and in any event within five days after the occurrence of
each Default continuing on the date of such statement, a statement of the chief
financial officer, treasurer or controller of the Borrower setting forth details
of such Default and the action that the Borrower has taken and proposes to take
with respect thereto;

(iv)

promptly after the sending or filing thereof, copies of all reports that the
Borrower sends to any of its securityholders, and copies of all reports and
registration statements that the Borrower or any Subsidiary files with the
Securities and Exchange Commission or any national securities exchange;

(v)

promptly after the commencement thereof, notice of all actions and proceedings
before any court, governmental agency or arbitrator affecting the Borrower or
any of its Subsidiaries of the type described in Section 4.01(f); and

(vi)

such other information respecting the Borrower or any of its Subsidiaries as any
Lender through the Agent may from time to time reasonably request.

Reports required to be delivered pursuant to clauses (i), (ii) and (iv) above
shall be deemed to have been delivered on the date on which such report is
posted on the SEC's website at www.sec.gov, and such posting shall be deemed to
satisfy the reporting requirements of clauses (i), (ii) and (iv) above; provided
that the Borrower shall deliver paper copies of the certificate required by
clauses (i), (ii), (iii) and (v) above to the Agent and each of the Lenders
until such time as the Agent shall provide the Borrower written notice
otherwise.

SECTION 5.02   Negative Covenants   So long as any Advance shall remain unpaid
or any Lender shall have any Commitment hereunder, the Borrower will not:

(a)

Liens, Etc.

Create or suffer to exist, or permit any of its Subsidiaries to create or suffer
to exist, any Lien on or with respect to any of its properties, whether now
owned or hereafter acquired, or assign, or permit any of its Subsidiaries to
assign, any right to receive income, other than:

 

(i)

Permitted Liens,

(ii)

purchase money Liens upon or in any real property or equipment acquired or held
by the Borrower or any Subsidiary in the ordinary course of business to secure
the purchase price of such property or equipment or to secure Debt incurred
solely for the purpose of financing the acquisition of such property or
equipment, or Liens existing on such property or equipment at the time of its
acquisition (other than any such Liens created in contemplation of such
acquisition that were not incurred to finance the acquisition of such property)
or extensions, renewals or replacements of any of the foregoing for the same or
a lesser amount, provided, however, that no such Lien shall extend to or cover
any properties of any character other than the real property or equipment being
acquired, and no such extension, renewal or replacement shall extend to or cover
any properties not theretofore subject to the Lien being extended, renewed or
replaced, provided further that the aggregate principal amount of the
indebtedness secured by the Liens referred to in this clause (ii) shall not
exceed $100,000,000 at any time outstanding,

(iii)

the Liens existing on the Effective Date and described on Schedule 4.01(j)
hereto,

(iv)

arising under the Borrower's receivables securitization transaction as described
in the Trade Receivables Purchase and Sell Agreement dated March 20, 1997 among
the Borrower, First Skelligs International Finance Company Limited and Citicorp
Finance Ireland Limited,

(v)

Liens arising in connection with any court action or other legal proceeding so
long as no Default under Section 6.01(f) has occurred and is continuing,

(vi)

other Liens securing Debt in an aggregate principal amount not to exceed
$25,000,000 at any time outstanding, and

(vii)

the replacement, extension or renewal of any Lien permitted by clause (iii)
above upon or in the same property theretofore subject thereto or the
replacement, extension or renewal (without increase in the amount or change in
any direct or contingent obligor) of the Debt secured thereby.

 

(b)

Mergers, Etc.

Merge or consolidate with or into, or convey, transfer, lease or otherwise
dispose of (whether in one transaction or in a series of transactions) all or
substantially all of its assets (whether now owned or hereafter acquired) to,
any Person, or permit any of its Material Subsidiaries to do so, except that (I)
any Material Subsidiary of the Borrower may merge or consolidate with or into,
or dispose of assets to, any other Subsidiary of the Borrower, (ii) any
Subsidiary of the Borrower may merge into or dispose of assets to the Borrower
and (iii) the Borrower may merge with any other Person so long as the Borrower
is the surviving corporation, provided, in each case, that no Default shall have
occurred and be continuing at the time of such proposed transaction or would
result therefrom.

(c)

Accounting Changes

. Make or permit, or permit any of its Subsidiaries to make or permit, any
change in accounting policies or reporting practices, except as required or
permitted by generally accepted accounting principles.

(d)

Subsidiary Debt

. Permit any of its Subsidiaries to create or suffer to exist, any Debt other
than:

(i)

Debt owed to the Borrower or to a wholly owned Subsidiary of the Borrower,

(ii)

Debt existing on the Effective Date and described on Schedule 5.02(d) hereto
(the "Existing Debt"), and any Debt extending the maturity of, or refunding or
refinancing, in whole or in part, the Existing Debt, provided that the principal
amount of such Existing Debt shall not be increased above the principal amount
thereof outstanding immediately prior to such extension, refunding or
refinancing, and the direct and contingent obligors therefor shall not be
changed, as a result of or in connection with such extension, refunding or
refinancing,

(iii)

Debt secured by Liens permitted by Section 5.02(a)(ii) or (iv),

(iv)

unsecured Debt incurred in the ordinary course of business aggregating for all
of the Borrower's Subsidiaries not more than $200,000,000 at any one time
outstanding, and

(v)

endorsement of negotiable instruments for deposit or collection or similar
transactions in the ordinary course of business.

 

(e)

Change in Nature of Business

. Make, or permit any of its Subsidiaries to make, any material change in the
nature of its business as carried on at the date hereof, taken as a whole.

(f)

Restrictive Agreements

. Directly or indirectly enter into, incur or permit to exist, or permit any of
its Subsidiaries to enter into, incur or permit to exist, any agreement or other
arrangement that prohibits, restricts or imposes any condition upon (i) the
ability of the Borrower or any Subsidiary to create, incur or permit to exist
any Lien upon any of its property or assets or (ii) the ability of any
Subsidiary to pay dividends or other distributions with respect to any shares of
its capital stock or to make or repay loans or advances to the Borrower or any
other Subsidiary or to guarantee Debt of the Borrower or any other Subsidiary;
provided that (A) the foregoing shall not apply to restrictions and conditions
imposed by law or by this Agreement, (B) the foregoing shall not apply to
restrictions and conditions that could not be reasonably expected to cause a
material adverse effect on the ability of the Borrower to perform any of its
obligations under this Agreement, (C) the foregoing shall not apply to
restrictions and conditions existing on the date hereof (but shall apply to any
extension or renewal of, or any amendment or modification expanding the scope
of, any such restriction or condition), (D) the foregoing shall not apply to
customary restrictions and conditions contained in agreements relating to the
sale of a Subsidiary pending such sale, provided such restrictions and
conditions apply only to the Subsidiary that is to be sold and such sale is
permitted hereunder, (E) clause (i) above shall not apply to restrictions or
conditions imposed by any agreement relating to secured Debt permitted by this
Agreement if such restrictions or conditions apply only to the property or
assets securing such Debt and (F) clause (i) above shall not apply to customary
provisions in leases and licenses restricting the assignment thereof.

(g)

Use of Proceeds

. Use, or permit any of its Subsidiaries to use, the proceeds of any Advances to
purchase or carry margin stock (within the meaning of Regulation U of the Board
of Governors of the Federal Reserve System)or to extend credit to others for the
purpose of purchasing or carrying margin stock.

SECTION 5.03   Financial Covenants   So long as any Advance shall remain unpaid
or any Lender shall have any Commitment hereunder, the Borrower will:

(a)

Leverage Ratio

. Maintain a ratio of Consolidated Debt for Borrowed Money to Consolidated
EBITDA of the Borrower and its Subsidiaries for the four fiscal quarters then
ended of not greater than 3.0:1.0.

(b)

Fixed Charge Coverage Ratio

. Maintain a ratio of Consolidated EBITDA of the Borrower and its Subsidiaries
for the four fiscal quarters then ended to interest payable on, and amortization
of debt discount in respect of, all Debt for Borrowed Money during such period,
by the Borrower and its Subsidiaries of not less than 4.5:1.0.

ARTICLE VI
EVENTS OF DEFAULT

SECTIONS 6.01   Events of Default   If any of the following events ("Events of
Default") shall occur and be continuing:

(a)

The Borrower shall fail to pay any principal of any Advance when the same
becomes due and payable; or the Borrower shall fail to pay any interest on any
Advance or make any other payment of fees or other amounts payable under this
Agreement or any Note within three Business Days after the same becomes due and
payable; or

(b)

Any representation or warranty made by the Borrower herein or by the Borrower
(or any of its officers) in connection with this Agreement shall prove to have
been incorrect in any material respect when made; or

(c)

(i) The Borrower shall fail to perform or observe any term, covenant or
agreement contained in Section 5.01(d), (e) or (h), 5.02 or 5.03, or (ii) the
Borrower shall fail to perform or observe any other term, covenant or agreement
contained in this Agreement on its part to be performed or observed if such
failure shall remain unremedied for 30 days after the earlier of (i) written
notice thereof shall have been given to the Borrower by the Agent or any Lender
and (ii) a responsible financial officer of the Borrower otherwise becomes aware
of such failure; or

(d)

The Borrower or any of its Subsidiaries shall fail to pay any principal of or
premium or interest on any Debt that is outstanding in a principal or notional
amount of at least $25,000,000 in the aggregate (but excluding Debt outstanding
hereunder) of the Borrower or such Subsidiary (as the case may be), when the
same becomes due and payable (whether by scheduled maturity, required
prepayment, acceleration, demand or otherwise), and such failure shall continue
after the applicable grace period, if any, specified in the agreement or
instrument relating to such Debt; or any other event shall occur or condition
shall exist under any agreement or instrument relating to any such Debt and
shall continue after the applicable grace period, if any, specified in such
agreement or instrument, if the effect of such event or condition is to
accelerate, or to permit the acceleration of, the maturity of such Debt; or any
such Debt shall be declared to be due and payable, or required to be prepaid or
redeemed (other than by a regularly scheduled required prepayment or
redemption), purchased or defeased, or an offer to prepay, redeem, purchase or
defease such Debt shall be required to be made, in each case prior to the stated
maturity thereof; or

(e)

The Borrower or any of its Material Subsidiaries shall generally not pay its
debts as such debts become due, or shall admit in writing its inability to pay
its debts generally, or shall make a general assignment for the benefit of
creditors; or any proceeding shall be instituted by or against the Borrower or
any of its Material Subsidiaries seeking to adjudicate it a bankrupt or
insolvent, or seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief, or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of debtors, or
seeking the entry of an order for relief or the appointment of a receiver,
trustee, custodian or other similar official for it or for any substantial part
of its property and, in the case of any such proceeding instituted against it
(but not instituted by it), either such proceeding shall remain undismissed or
unstayed for a period of 60 days, or any of the actions sought in such
proceeding (including, without limitation, the entry of an order for relief
against, or the appointment of a receiver, trustee, custodian or other similar
official for, it or for any substantial part of its property) shall occur; or
the Borrower or any of its Material Subsidiaries shall take any corporate action
to authorize any of the actions set forth above in this subsection (e); or

(f)

Any judgments or orders for the payment of money in excess of $25,000,000 in the
aggregate shall be rendered against the Borrower or any of its Subsidiaries and
either (i) enforcement proceedings shall have been commenced by any creditor
upon such judgment or order or (ii) other than in respect of a settlement order,
there shall be any period of 30 consecutive days during which a stay of
enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect or (iii) the Borrower or any of its
Subsidiaries shall be in default under a settlement order; or

(g)

Any non-monetary judgment or order shall be rendered against the Borrower or any
of its Subsidiaries that could be reasonably expected to have a Material Adverse
Effect, and there shall be any period of 30 consecutive days during which a stay
of enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect; or

(h)

(i) Any Person or two or more Persons acting in concert shall have acquired
beneficial ownership (within the meaning of Rule 13d-3 of the Securities and
Exchange Commission under the Securities Exchange Act of 1934), directly or
indirectly, of Voting Stock of the Borrower (or other securities convertible
into such Voting Stock) representing 30% or more of the combined voting power of
all Voting Stock of the Borrower; or (ii)  during any period of up to 24
consecutive months, commencing before or after the date of this Agreement,
individuals who at the beginning of such 24-month period were directors of the
Borrower shall cease for any reason to constitute a majority of the board of
directors of the Borrower; or (iii) any Person or two or more Persons acting in
concert shall have acquired by contract or otherwise, or shall have entered into
a contract or arrangement that, upon consummation, will result in its or their
acquisition of the power to exercise, directly or indirectly, a controlling
influence over the management or policies of the Borrower; or

(i)

The Borrower or any of its ERISA Affiliates shall incur, or shall be reasonably
likely to incur liability in excess of $25,000,000 in the aggregate as a result
of one or more of the following: (i) the occurrence of any ERISA Event; (ii) the
partial or complete withdrawal of the Borrower or any of its ERISA Affiliates
from a Multiemployer Plan; or (iii) the reorganization or termination of a
Multiemployer Plan;

then, and in any such event, the Agent (i) shall at the request, or may with the
consent, of the Required Lenders, by notice to the Borrower, declare the
obligation of each Lender to make Advances to be terminated, whereupon the same
shall forthwith terminate, and (ii) shall at the request, or may with the
consent, of the Required Lenders, by notice to the Borrower, declare the Notes,
all interest thereon and all other amounts payable under this Agreement to be
forthwith due and payable, whereupon the Notes, all such interest and all such
amounts shall become and be forthwith due and payable, without presentment,
demand, protest or further notice of any kind, all of which are hereby expressly
waived by the Borrower; provided, however, that in the event of an actual or
deemed entry of an order for relief with respect to the Borrower under the
Federal Bankruptcy Code, (A) the obligation of each Lender to make Advances
shall automatically be terminated and (B) the Notes, all such interest and all
such amounts shall automatically become and be due and payable, without
presentment, demand, protest or any notice of any kind, all of which are hereby
expressly waived by the Borrower.

ARTICLE VII
THE AGENT

SECTION 7.01   Authorization and Action   Each Lender hereby appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers and discretion under this Agreement as are delegated to the Agent by
the terms hereof, together with such powers and discretion as are reasonably
incidental thereto. As to any matters not expressly provided for by this
Agreement (including, without limitation, enforcement or collection of the
Notes), the Agent shall not be required to exercise any discretion or take any
action, but shall be required to act or to refrain from acting (and shall be
fully protected in so acting or refraining from acting) upon the instructions of
the Required Lenders, and such instructions shall be binding upon all Lenders
and all holders of Notes; provided, however, that the Agent shall not be
required to take any action that exposes the Agent to personal liability or that
is contrary to this Agreement or applicable law. The Agent agrees to give to
each Lender prompt notice of each notice given to it by the Borrower pursuant to
the terms of this Agreement.

SECTION 7.02   Agent's Reliance, Etc   Neither the Agent nor any of its
directors, officers, agents or employees shall be liable to the Lenders for any
action taken or omitted to be taken by it or them under or in connection with
this Agreement, except for its or their own gross negligence or willful
misconduct. Without limitation of the generality of the foregoing, the Agent:
(i) may treat the Lender that made any Advance as the holder of the Debt
resulting therefrom until the Agent receives and accepts an Assignment and
Acceptance entered into by such Lender, as assignor, and an Eligible Assignee,
as assignee, as provided in Section 8.07; (ii) may consult with legal counsel
(including counsel for the Borrower), independent public accountants and other
experts selected by it and shall not be liable for any action taken or omitted
to be taken in good faith by it in accordance with the advice of such counsel,
accountants or experts; (iii) makes no warranty or representation to any Lender
and shall not be responsible to any Lender for any statements, warranties or
representations (whether written or oral) made in or in connection with this
Agreement; (iv) shall not have any duty to ascertain or to inquire as to the
performance or observance of any of the terms, covenants or conditions of this
Agreement on the part of the Borrower or to inspect the property (including the
books and records) of the Borrower; (v) shall not be responsible to any Lender
for the due execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement or any other instrument or document
furnished pursuant hereto; and (vi) shall incur no liability under or in respect
of this Agreement by acting upon any notice, consent, certificate or other
instrument or writing (which may be by telecopier, telegram or telex) believed
by it to be genuine and signed or sent by the proper party or parties.

SECTION 7.03   Citibank and Affiliates   With respect to its Commitment, the
Advances made by it and the Note issued to it, Citibank shall have the same
rights and powers under this Agreement as any other Lender and may exercise the
same as though it were not the Agent; and the term "Lender" or "Lenders" shall,
unless otherwise expressly indicated, include Citibank in its individual
capacity. Citibank and its Affiliates may accept deposits from, lend money to,
act as trustee under indentures of, accept investment banking engagements from
and generally engage in any kind of business with, the Borrower, any of its
Subsidiaries and any Person who may do business with or own securities of the
Borrower or any such Subsidiary, all as if Citibank were not the Agent and
without any duty to account therefor to the Lenders.

SECTION 7.04   Lender Credit Decision   Each Lender acknowledges that it has,
independently and without reliance upon the Agent or any other Lender and based
on the financial statements referred to in Section 4.01 and such other documents
and information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each Lender also acknowledges that it
will, independently and without reliance upon the Agent or any other Lender 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.

SECTION 7.05   Indemnification   The Lenders agree to indemnify the Agent (to
the extent not reimbursed by the Borrower), ratably according to the respective
principal amounts of the Notes then held by each of them (or if no Notes are at
the time outstanding or if any Notes are held by Persons that are not Lenders,
ratably according to the respective amounts of their Commitments), from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever that may be imposed on, incurred by, or asserted against the
Agent in any way relating to or arising out of this Agreement or any action
taken or omitted by the Agent under this Agreement (collectively, the
"Indemnified Costs"), provided that no Lender shall be liable for any portion of
the Indemnified Costs resulting from the Agent's gross negligence or willful
misconduct. Without limitation of the foregoing, each Lender agrees to reimburse
the Agent promptly upon demand for its ratable share of any out-of-pocket
expenses (including counsel fees) incurred by the Agent in connection with the
preparation, execution, delivery, administration, modification, amendment or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities under, this Agreement,
to the extent that the Agent is not reimbursed for such expenses by the
Borrower. In the case of any investigation, litigation or proceeding giving rise
to any Indemnified Costs, this Section 7.05 applies whether any such
investigation, litigation or proceeding is brought by the Agent, any Lender or a
third party.

SECTION 7.06   Successor Agent   The Agent may resign at any time by giving
written notice thereof to the Lenders and the Borrower and may be removed at any
time with or without cause by the Required Lenders. Upon any such resignation or
removal, the Required Lenders shall have the right to appoint a successor Agent
with the consent, so long as no Event of Default shall have occurred and be
continuing, of the Borrower (which consent shall not be unreasonably withheld or
delayed). If no successor Agent shall have been so appointed by the Required
Lenders, and shall have accepted such appointment, within 30 days after the
retiring Agent's giving of notice of resignation or the Required Lenders'
removal of the retiring Agent, then the retiring Agent may, on behalf of the
Lenders, appoint a successor Agent, which shall be a commercial bank organized
under the laws of the United States of America or of any State thereof and
having a combined capital and surplus of at least $50,000,000. Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, discretion, privileges and duties of the retiring Agent, and the
retiring Agent shall thereupon be discharged from its duties and obligations
under this Agreement. After any retiring Agent's resignation or removal
hereunder as Agent, the provisions of this Article VII shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was Agent
under this Agreement.

SECTION 7.07   Other Agents   Each Lender hereby acknowledges that none of the
documentation agent, the syndication agent or any other Lender designated as any
"Agent" (other than the Agent) on the signature pages hereof has any liability
hereunder other than in its capacity as a Lender.

ARTICLE VIII
MISCELLANEOUS

SECTION 8.01   Amendments, Etc   No amendment or waiver of any provision of this
Agreement or the Notes, nor consent to any departure by the Borrower therefrom,
shall in any event be effective unless the same shall be in writing and signed
by the Required Lenders, and then such waiver or consent shall be effective only
in the specific instance and for the specific purpose for which given; provided,
however, that no amendment, waiver or consent shall, unless in writing and
signed by all the Lenders, do any of the following: (a) waive any of the
conditions specified in Section 3.01, (b) increase the Commitments of the
Lenders or subject the Lenders to any additional obligations, (c) reduce the
principal of, or interest on, the Notes or any fees or other amounts payable
hereunder, (d) postpone any date fixed for any payment of principal of, or
interest on, the Notes or any fees or other amounts payable hereunder,
(e) change the percentage of the Commitments or of the aggregate unpaid
principal amount of the Notes, or the number of Lenders, that shall be required
for the Lenders or any of them to take any action hereunder, or (f) amend this
Section 8.01; and provided further that (x) no amendment, waiver or consent
shall, unless in writing and signed by the Agent in addition to the Lenders
required above to take such action, affect the rights or duties of the Agent
under this Agreement or any Note and (y) no amendment, waiver or consent of
Section 8.07(f) shall, unless in writing and signed by each Lender that has
granted a funding option to an SPC in addition to the Lenders required above to
take such action, affect the rights or duties of such Lender or SPC under this
Agreement or any Note.

SECTION 8.02   Notices, Etc   All notices and other communications provided for
hereunder shall be in writing (including telecopier, telegraphic or telex
communication) and mailed, telecopied, telegraphed, telexed or delivered, if to
the Borrower, at its address at One Bausch & Lomb Place, Rochester, New York
14604, Attention: Treasurer; if to any Initial Lender, at its Domestic Lending
Office specified opposite its name on Schedule I hereto; if to any other Lender,
at its Domestic Lending Office specified in the Assignment and Acceptance
pursuant to which it became a Lender; and if to the Agent, at its address at Two
Penns Way, New Castle, Delaware 19720, Attention: Bank Loan Syndications
Department; or, as to the Borrower or the Agent, at such other address as shall
be designated by such party in a written notice to the other parties and, as to
each other party, at such other address as shall be designated by such party in
a written notice to the Borrower and the Agent. All such notices and
communications shall, when mailed, telecopied, telegraphed or telexed, be
effective when deposited in the mails, telecopied, delivered to the telegraph
company or confirmed by telex answerback, respectively, except that notices and
communications to the Agent pursuant to Article II, III or VII shall not be
effective until received by the Agent. Delivery by telecopier of an executed
counterpart of any amendment or waiver of any provision of this Agreement or the
Notes or of any Exhibit hereto to be executed and delivered hereunder shall be
effective as delivery of a manually executed counterpart thereof.

SECTION 8.03   No Waiver; Remedies   No failure on the part of any Lender or the
Agent to exercise, and no delay in exercising, any right hereunder or under any
Note shall operate as a waiver thereof; nor shall any single or partial exercise
of any such right preclude any other or further exercise thereof or the exercise
of any other right. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law.

SECTION 8.04   Costs and Expenses   (a) The Borrower agrees to pay upon
presentation of reasonably detailed invoices all costs and expenses of the Agent
in connection with the preparation, execution, delivery, administration,
modification and amendment of this Agreement, the Notes and the other documents
to be delivered hereunder, including, without limitation, (A) all due diligence,
syndication (including printing, distribution and bank meetings),
transportation, computer, duplication, appraisal, consultant, and audit expenses
and (B) the reasonable fees and expenses of counsel for the Agent with respect
thereto and with respect to advising the Agent as to its rights and
responsibilities under this Agreement. The Borrower further agrees to pay upon
presentation of reasonably detailed invoices all costs and expenses of the Agent
and the Lenders, if any (including, without limitation, reasonable counsel fees
and expenses), in connection with the enforcement (whether through negotiations,
legal proceedings or otherwise) of this Agreement, the Notes and the other
documents to be delivered hereunder, including, without limitation, reasonable
fees and expenses of counsel for the Agent and each Lender in connection with
the enforcement of rights under this Section 8.04(a).

(b)

The Borrower agrees to indemnify and hold harmless the Agent and each Lender and
each of their Affiliates and their officers, directors, employees, agents and
advisors (each, an "Indemnified Party") from and against any and all claims,
damages, losses, liabilities and expenses (including, without limitation,
reasonable fees and expenses of counsel) that may be incurred by or asserted or
awarded against any Indemnified Party, in each case arising out of or in
connection with or by reason of (including, without limitation, in connection
with any investigation, litigation or proceeding or preparation of a defense in
connection therewith) (i) the Notes, this Agreement, any of the transactions
contemplated herein or the actual or proposed use of the proceeds of the
Advances or (ii) the actual or alleged presence of Hazardous Materials on any
property of the Borrower or any of its Subsidiaries or any Environmental Action
relating in any way to the Borrower or any of its Subsidiaries, except to the
extent such claim, damage, loss, liability or expense is found in a final,
non-appealable judgment by a court of competent jurisdiction to have resulted
from such Indemnified Party's gross negligence or willful misconduct. In the
case of an investigation, litigation or other proceeding to which the indemnity
in this Section 8.04(b) applies, such indemnity shall be effective whether or
not such investigation, litigation or proceeding is brought by the Borrower, its
directors, equityholders or creditors or an Indemnified Party or any other
Person, whether or not any Indemnified Party is otherwise a party thereto and
whether or not the transactions contemplated hereby are consummated. The
Borrower also agrees not to assert any claim against the Agent, any Lender, any
of their Affiliates, or any of their respective directors, officers, employees,
attorneys and agents, on any theory of liability, for special, indirect,
consequential or punitive damages arising out of or otherwise relating to the
Notes, this Agreement, any of the transactions contemplated herein or the actual
or proposed use of the proceeds of the Advances. Nothing in this Section 8.04(b)
shall be deemed, construed or given effect to relieve or release the Agent or
any Lender from any liability for breach of contract arising from a failure by
such party to perform its contractual obligations hereunder.

(c)

If any payment of principal of, or Conversion of, any Eurodollar Rate Advance is
made by the Borrower to or for the account of a Lender other than on the last
day of the Interest Period for such Advance, as a result of a payment or
Conversion pursuant to Section 2.07(d) or (e), 2.09 or 2.11, acceleration of the
maturity of the Notes pursuant to Section 6.01 or for any other reason or by an
Eligible Assignee to a Lender other than on the last day of the Interest Period
for such Advance upon an assignment of rights and obligations under this
Agreement pursuant to Section 8.07 as a result of a demand by the Borrower
pursuant to Section 8.07(a), the Borrower shall, upon demand by such Lender
(with a copy of such demand to the Agent), pay to the Agent for the account of
such Lender any amounts required to compensate such Lender for any additional
losses, costs or expenses that it may reasonably incur as a result of such
payment or Conversion, including, without limitation, any loss, cost or expense
incurred by reason of the liquidation or reemployment of deposits or other funds
acquired by any Lender to fund or maintain such Advance. Such indemnification
shall be paid upon presentation to the Borrower or a reasonably detailed
statement of such loss, cost or expense certified by an officer of such Lender.

(d)

Without prejudice to the survival of any other agreement of the Borrower
hereunder, the agreements and obligations of the Borrower contained in
Sections 2.10, 2.13 and 8.04 shall survive the payment in full of principal,
interest and all other amounts payable hereunder and under the Notes.

SECTION 8.05   Right of Set-off   Upon (i) the occurrence and during the
continuance of any Event of Default and (ii) the making of the request or the
granting of the consent specified by Section 6.01 to authorize the Agent to
declare the Notes due and payable pursuant to the provisions of Section 6.01,
each Lender and each of its Affiliates is hereby authorized at any time and from
time to time, 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 indebtedness at any time owing by such Lender or such
Affiliate to or for the credit or the account of the Borrower against any and
all of the obligations of the Borrower now or hereafter existing under this
Agreement and the Note held by such Lender, whether or not such Lender shall
have made any demand under this Agreement or such Note and although such
obligations may be unmatured. Each Lender agrees promptly to notify the Borrower
after any such set-off and application, provided that the failure to give such
notice shall not affect the validity of such set-off and application. The rights
of each Lender and its Affiliates under this Section are in addition to other
rights and remedies (including, without limitation, other rights of set-off)
that such Lender and its Affiliates may have.

SECTION 8.06   Binding Effect   This Agreement shall become effective (other
than Section 2.01, which shall only become effective upon satisfaction of the
conditions precedent set forth in Section  3.01) when it shall have been
executed by the Borrower and the Agent and when the Agent shall have been
notified by each Initial Lender that such Initial Lender has executed it and
thereafter shall be binding upon and inure to the benefit of the Borrower, the
Agent and each Lender and their respective successors and assigns, except that
the Borrower shall not have the right to assign its rights hereunder or any
interest herein without the prior written consent of the Lenders.

SECTION 8.07   Assignments and Participations   (a) Each Lender may, and if
demanded by the Borrower (following a demand by such Lender pursuant to Section
2.10 or 2.13) upon at least five Business Days' notice to such Lender and the
Agent will, assign to one or more Persons all or a portion of its rights and
obligations under this Agreement (including, without limitation, all or a
portion of its Commitment, the Advances owing to it and any Note or Notes held
by it); provided, however, that (i) each such assignment shall be of a constant,
and not a varying, percentage of all rights and obligations under this
Agreement, (ii) except in the case of an assignment to a Person that,
immediately prior to such assignment, was a Lender or an assignment of all of a
Lender's rights and obligations under this Agreement, the amount of the
Commitment of the assigning Lender being assigned pursuant to each such
assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event be less than $5,000,000 or an
integral multiple of $1,000,000 in excess thereof, (iii) each such assignment
shall be to an Eligible Assignee, (iv) each such assignment made as a result of
a demand by the Borrower pursuant to this Section 8.07(a) shall be arranged by
the Borrower after consultation with the Agent and shall be either an assignment
of all of the rights and obligations of the assigning Lender under this
Agreement or an assignment of a portion of such rights and obligations made
concurrently with another such assignment or other such assignments that
together cover all of the rights and obligations of the assigning Lender under
this Agreement, (v) no Lender shall be obligated to make any such assignment as
a result of a demand by the Borrower pursuant to this Section 8.07(a) unless and
until such Lender shall have received one or more payments from either the
Borrower or one or more Eligible Assignees in an aggregate amount at least equal
to the aggregate outstanding principal amount of the Advances owing to such
Lender, together with accrued interest thereon to the date of payment of such
principal amount and all other amounts payable to such Lender under this
Agreement and (vi) the parties to each such assignment shall execute and deliver
to the Agent, for its acceptance and recording in the Register, an Assignment
and Acceptance, together with any Note subject to such assignment and a
processing and recordation fee of $3,500 payable by the parties to each such
assignment, provided, however, that in the case of each assignment made as a
result of a demand by the Borrower, such recordation fee shall be payable by the
Borrower except that no such recordation fee shall be payable in the case of an
assignment made at the request of the Borrower to an Eligible Assignee that is
an existing Lender, and (vii) any Lender may, without the approval of the
Borrower and the Agent, assign all or a portion of its rights to any of its
Affiliates. Upon such execution, delivery, acceptance and recording, from and
after the effective date specified in each Assignment and Acceptance, (x) the
assignee thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment and
Acceptance, have the rights and obligations of a Lender hereunder and (y) the
Lender assignor thereunder shall, to the extent that rights and obligations
hereunder have been assigned by it pursuant to such Assignment and Acceptance,
relinquish its rights and be released from its obligations under this Agreement
(and, in the case of an Assignment and Acceptance covering all or the remaining
portion of an assigning Lender's rights and obligations under this Agreement,
such Lender shall cease to be a party hereto).

(b)

By executing and delivering an Assignment and Acceptance, the Lender assignor
thereunder and the assignee thereunder confirm to and agree with each other and
the other parties hereto as follows: (i) other than as provided in such
Assignment and Acceptance, such assigning Lender makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement or
the execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other instrument or document furnished pursuant
hereto; (ii) such assigning Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrower or the performance or observance by the Borrower of any of its
obligations under this Agreement or any other instrument or document furnished
pursuant hereto; (iii) such assignee confirms that it has received a copy of
this Agreement, together with copies of the financial statements referred to in
Section 4.01 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; (iv) such assignee will, independently and without
reliance upon the Agent, such assigning Lender or any other Lender 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; (v) such assignee confirms that it is an Eligible Assignee;
(vi) such assignee appoints and authorizes the Agent to take such action as
agent on its behalf and to exercise such powers and discretion under this
Agreement as are delegated to the Agent by the terms hereof, together with such
powers and discretion as are reasonably incidental thereto; and (vii) such
assignee agrees that it will perform in accordance with their terms all of the
obligations that by the terms of this Agreement are required to be performed by
it as a Lender.

(c)

The Agent shall maintain at its address referred to in Section 8.02 a copy of
each Assignment and Acceptance delivered to and accepted by it and a register
for the recordation of the names and addresses of the Lenders and the Commitment
of, and principal amount of the Advances owing to, each Lender from time to time
(the "Register"). The entries in the Register shall be conclusive and binding
for all purposes, absent manifest error, and the Borrower, the Agent and the
Lenders may treat each Person whose name is recorded in the Register as a Lender
hereunder for all purposes of this Agreement. The Register shall be available
for inspection by the Borrower or any Lender at any reasonable time and from
time to time upon reasonable prior notice.

(d)

Upon its receipt of an Assignment and Acceptance executed by an assigning Lender
and an assignee representing that it is an Eligible Assignee, together with any
Note or Notes subject to such assignment, the Agent shall, if such Assignment
and Acceptance has been completed and is in substantially the form of Exhibit C
hereto, (i) accept such Assignment and Acceptance, (ii) record the information
contained therein in the Register and (iii) give prompt notice thereof to the
Borrower. Within five Business Days after its receipt of such notice, the
Borrower, at its own expense, shall execute and deliver to the Agent in exchange
for the surrendered Note a new Note to the order of such Eligible Assignee in an
amount equal to the Commitment assumed by it pursuant to such Assignment and
Acceptance and, if the assigning Lender has retained a Commitment hereunder, a
new Note to the order of the assigning Lender in an amount equal to the
Commitment retained by it hereunder. Such new Note or Notes shall be in an
aggregate principal amount equal to the aggregate principal amount of such
surrendered Note or Notes, shall be dated the effective date of such Assignment
and Acceptance and shall otherwise be in substantially the form of Exhibit A
hereto.

(e)

Each Lender may sell participations to one or more banks or other entities
(other than the Borrower or any of its Affiliates) in or to all or a portion of
its rights or obligations under this Agreement (including, without limitation,
all or a portion of its Commitment, the Advances owing to it and the Note or
Notes held by it); provided, however, that (i) such Lender's obligations under
this Agreement (including, without limitation, its Commitment to the Borrower
hereunder) shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations,
(iii) such Lender shall remain the holder of any such Note for all purposes of
this Agreement, (iv) the Borrower, the Agent and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement and (v) no participant
under any such participation shall have any right to approve any amendment or
waiver of any provision of this Agreement or any Note, or any consent to any
departure by the Borrower therefrom, except to the extent that such amendment,
waiver or consent would reduce the principal of, or interest on, the Notes or
any fees or other amounts payable hereunder, in each case to the extent subject
to such participation, or postpone any date fixed for any payment of principal
of, or interest on, the Notes or any fees or other amounts payable hereunder, in
each case to the extent subject to such participation.

(f)

Each Lender may grant to a special purpose funding vehicle (an "SPC") the option
to fund all or any part of any Advance that such Lender is obligated to fund
under this Agreement (and upon the exercise by such SPC of such option to fund,
such Lender's obligations with respect to such Advance shall be deemed satisfied
to the extent of any amounts funded by such SPC); provided, however, that (i)
such Lender's obligations under this Agreement (including, without limitation,
its Commitment to the Borrower hereunder) shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations, (iii) the Borrower, the Administrative Agent
and the other Lenders shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under this
Agreement, (iv) any such option granted to an SPC shall not constitute a
commitment by such SPC to fund any Advance, (v) neither the grant nor the
exercise of such option to an SPC shall increase the costs or expenses or
otherwise increase or change the obligations of the Borrower under this
Agreement (including, without limitation, its obligations under Section 2.09)
(vi) the SPC shall be bound by the provisions of Section 8.08 and (vii) no SPC
shall have any right to approve any amendment or waiver of any provision of this
Agreement or any Note, nor any consent to any departure by the Borrower
therefrom, except to the extent that such amendment, waiver or consent would
reduce the principal of, or interest on, the Notes or any fees or other amounts
payable hereunder, in each case to the extent subject to such grant of funding
option, or postpone any date fixed for any payment of principal of, or interest
on, the Notes or any fees or other amounts payable hereunder, in each case to
the extent subject to such grant of funding option. Each party to this Agreement
hereby agrees that no SPC shall be liable for any indemnity or payment under
this Agreement for which a Lender would otherwise be liable. Subject to the
foregoing provisions of this clause (f), an SPC shall have all the rights of the
granting Lender. An SPC may assign or participate all or a portion of its
interest in any Advances to the granting Lender or to any financial institution
providing liquidity or credit support to or for the account of such SPC without
paying any processing fee therefor and, in connection therewith may disclose on
a confidential basis any information relating to the Borrower to any rating
agency, commercial paper dealer or provider of any surety, guarantee or credit
or liquidity enhancements to such SPC. In furtherance of the foregoing, each
party hereto agrees (which agreements shall survive the termination of this
Agreement) that, prior to the date that is one year and one day after the
payment in full of all outstanding commercial paper or other senior indebtedness
of any SPC, it will not institute against, or join any other Person in
instituting against, such SPC any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings under the laws of the United States or any
State thereof.

(g)

Any Lender may, in connection with any assignment, designation, participation or
grant of funding option or proposed assignment, designation, participation or
grant of funding option pursuant to this Section 8.07, disclose to the assignee,
designee, participant or SPC or proposed assignee, designee, participant or SPC,
any information relating to any Borrower furnished to such Lender by or on
behalf of such Borrower; provided that, prior to any such disclosure, the
assignee, designee, participant or SPC or proposed assignee, designee,
participant or SPC shall agree to preserve the confidentiality of any
Confidential Information relating to any Borrower received by it from such
Lender.

(h)

Notwithstanding any other provision set forth in this Agreement, any Lender may
at any time create a security interest in all or any portion of its rights under
this Agreement (including, without limitation, the Advances owing to it and any
Note held by it) in favor of any Federal Reserve Bank in accordance with
Regulation A of the Board of Governors of the Federal Reserve System.

SECTION 8.08   Confidentiality   Neither the Agent nor any Lender or SPC shall
disclose any Confidential Information to any other Person without the consent of
the Borrower, other than (a) to the Agent's or such Lender's Affiliates and
their officers, directors, employees, agents and advisors and, as contemplated
by Section 8.07(f), to actual or prospective assignees and participants, and
then only on a confidential basis, (b) as required by any law, rule or
regulation or judicial process and (c) as requested or required by any state,
federal or foreign authority or examiner regulating banks or banking.

SECTION 8.09   Governing Law   This Agreement and the Notes shall be governed
by, and construed in accordance with, the laws of the State of New York.

SECTION 8.10   Execution in Counterparts   This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement. 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 8.11   Jurisdiction, Etc   (a) Each of the parties hereto hereby
irrevocably and unconditionally submits, for itself and its property, to the
nonexclusive jurisdiction of any New York State court or federal court of the
United States of America sitting in New York City, and any appellate court from
any thereof, in any action or proceeding arising out of or relating to this
Agreement or the Notes, or for recognition or enforcement of any judgment, and
each of the parties hereto hereby irrevocably and unconditionally agrees that
all claims in respect of any such action or proceeding may be heard and
determined in any such New York State court or, to the extent permitted by law,
in such federal court. Each of the parties hereto agrees that a final judgment
in any such action or proceeding shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other manner provided by
law. Nothing in this Agreement shall affect any right that any party may
otherwise have to bring any action or proceeding relating to this Agreement or
the Notes in the courts of any jurisdiction.

(b)

Each of the parties hereto irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection that it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement or the Notes in any New York State
or federal court. Each of the parties hereto hereby irrevocably waives, to the
fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.

SECTION 8.12   Waiver of Jury Trial   Each of the Borrower, the Agent and the
Lenders hereby irrevocably waives all right to trial by jury in any action,
proceeding or counterclaim (whether based on contract, tort or otherwise)
arising out of or relating to this Agreement or the Notes or the actions of the
Agent or any Lender in the negotiation, administration, performance or
enforcement thereof.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective officers thereunto duly authorized, as of the date first
above written.

BAUSCH & LOMB INCORPORATED

By /s/______________________________

          Alan H. Resnick

Title:  Corporate Vice-President & Treasurer

     

CITIBANK, NA.,

as Agent

By /s/______________________________

          Carolyn A. Kee

Title:  Vice President

 

Initial Lenders

Commitment

 

$50,000,000

BANK OF AMERICA, N.A.

By /s/_____________________________________
     Philip S. Durand
     Title:  Principal

   

$50,000,000

THE CHASE MANHATTAN BANK
By /s/______________________________________
     Stephen P. Rochford
     Title:  Vice President

   

$50,000,000

CITIBANK, N.A.

By /s/______________________________________
     Carolyn A. Kee
     Title:  Vice President

   

$50,000,000

FLEET NATIONAL BANK

By /s/______________________________________
     Martin K. Birmingham
     Title:  Regional President

   

$30,000,000

NORTHERN TRUST COMPANY

By /s/______________________________________
     Russell R. Rockenbach
     Title:  Sr.Vice President

   

$20,000,000

ALLIED IRISH BANK

By /s/______________________________________
     Paul Carey
     Title:  Managing Director

 

$250,000,000      Total of the Commitments

SCHEDULE I
BAUSCH & LOMB INCORPORATED
THREE YEAR CREDIT AGREEMENT
APPLICABLE LENDING OFFICES

Name of Initial Lender

Domestic Lending Office

Eurodollar Lending Office

Allied Irish Bank

405 Park Avenue
New York, NY 10022
Attn: Paul Carey
T: 212 515-6755
F: 212 339-339-8006

405 Park Avenue
New York, NY 10022
Attn: Paul Carey
T: 212 515-6755
F: 212 339-339-8006

Bank of America, N.A.

101 North Tryon Street, 15th Floor
Charlotte, NC 28255
Attn: Debra Glenn
T: 704 387-9919
F: 704 409-0091

101 North Tryon Street, 15th Floor
Charlotte, NC 28255
Attn: Debra Glenn
T: 704 387-9919
F: 704 409-0091

The Chase Manhattan Bank

One Chase Manhattan Plaza
New York, NY 10081
Attn: Concetta Prainito
T: 212 552-7241
F: 212 552-7500

One Chase Manhattan Plaza
New York, NY 10081
Attn: Concetta Prainito
T: 212 552-7241
F: 212 552-7500

Citibank, N.A.

Two Penns Way
New Castle, DE 19720
Attn: Loan Syndications

Two Penns Way
New Castle, DE 19720
Attn: Loan Syndications

Fleet National Bank

One East Avenue
Rochester, NY 14638
Attn: Sheila Hanley
T: 716 546-9020
F: 716 546-9800

One East Avenue
Rochester, NY 14638
Attn: Sheila Hanley
T: 716 546-9020
F: 716 546-9800

Northern Trust Company

50 S. LaSalle
Chicago, IL 60675
Attn: Linda Honda
T: 312 444-4715
F: 312 630-6015

50 S. LaSalle
Chicago, IL 60675
Attn: Linda Honda
T: 312 444-4715
F: 312 630-6015

Schedule 3.01(b)

to
Three Year Credit Agreement

Dated as of January 19, 2001

 

DISCLOSED LITIGATION

In several actions, the company is defending against claims that its
long-standing policy of selling contact lenses only to licensed professionals
was adopted in conspiracy with others to eliminate alternative channels of trade
from the disposable contact lens market. These matters include (i) a
consolidated action in the United States District Court for the Middle District
of Florida filed in June 1994 by the Florida Attorney General, and now includes
claims by the attorneys general for 21 other states, and (ii) individual actions
pending in California and Tennessee state courts. The company insists that its
policy was adopted lawfully as a means of ensuring effective distribution of its
products and safeguarding consumers' health.

Schedule 4.01(j)

Bausch & Lomb Incorporated

Existing Liens

(000's)

Entity

Debt

Lien

Amount

Bausch & Lomb Incorporated

Skelligs (Factoring Program)

US Accounts Receivable

$75,000

 

 

Schedule 4.01(n)

 

Bausch & Lomb Incorporated

Material Subsidiaries

 

 

Percentage

Consolidated

Consolidated

Subsidiary

Assets (a)

Sales (b)

Bausch & Lomb Ireland

22.78%

7.96%

B&L Surgical Inc.

21.37%

19.67%

Bausch & Lomb (Bermuda) limited

16.56%

0.00%

Group Chauvin

9.17%

2.07%

B&L European Phamraceuticals

8.20%

0.00%

B&L BV (Netherlands)

5.68%

13.24%

Bausch & Lomb Japan

4.98%

12.32%

Bausch & Lomb Pharmaceuticals

4.52%

7.38%

(a)   Including intercompany receivables

(b)   Including intercompany sales

   

Schedule 5.02(d)

Bausch & Lomb Incorporated

Outstanding Debt

(000's)

At December 30, 2000

Description of Debt

CUSIP

Maturity Date

Interest

Rate

Short-Term

Long-Term

US

Medium Term Notes

07171JAD8

08-Sep-03

Fixed

5.950%

$85,000

Portable Notes

07171JAE6

12-Aug-26

Fixed

6.560   

100,000

Notes

071707AC7

15-Dec-04

Fixed

6.750   

194,600

Purtable/Callable Notes

071707AF0

01-Aug-11

Fixed

6.150   

97,000

Purtable/Callable Notes

071707AD5

01-Aug-13

Fixed

6.375   

100,000

Purtable/Callable Notes

071707AE3

01-Aug-25

Fixed

6.500   

100,000

Debentures

071707AG8

01-Aug-28

Fixed

7.125   

194,000

Industrial Development Bonds

-

07-Jul-05

Floating

-

8,500

Skelligs (Factoring Program)

-

05-Apr-02

Floating

1 mo. LIBOR
less 0.15%

75,000

Accounting Reclass - Cash
          Overdrafts

-

-

-

-

$10,083

 

Other

-

Various

Various

Various

460

Sub-total US

10,083

954,560

Non-US

B&L Japan

-

-

Floating

-

20,484

B&L Japan

4,453

B&L Turkey

1,000

Group Chauvin

Various

Various

Various

773

6,485

Other

Various

Various

Various

268

126

Sub-total Non-US

22,525

11,064

Total Debt

$32,608

$965,624

EXHIBIT A - FORM OF
PROMISSORY NOTE

U.S.$_______________                                           
Dated:  _______________, 20__

FOR VALUE RECEIVED, the undersigned, BAUSCH & LOMB INCORPORATED, a New York
corporation (the "Borrower"), HEREBY PROMISES TO PAY to the order of
_________________________ (the "Lender") for the account of its Applicable
Lending Office on the Termination Date (each as defined in the Credit Agreement
referred to below) the principal sum of U.S.$[amount of the Lender's Commitment
in figures] or, if less, the aggregate principal amount of the Advances made by
the Lender to the Borrower pursuant to the Credit Agreement dated as of January
19, 2001 among the Borrower, the Lender and certain other lenders parties
thereto, Salomon Smith Barney Inc., as arranger, Fleet National Bank, as
documentation agent, The Chase Manhattan Bank, as syndication agent, and
Citibank, N.A., as Agent for the Lender and such other lenders (as amended or
modified from time to time, the "Credit Agreement"; the terms defined therein
being used herein as therein defined) outstanding on the Termination Date.

          The Borrower promises to pay interest on the unpaid principal amount
of each Advance from the date of such Advance until such principal amount is
paid in full, at such interest rates, and payable at such times, as are
specified in the Credit Agreement.

          Both principal and interest are payable in lawful money of the United
States of America to Citibank, N.A., as Agent, at 399 Park Avenue, New York, New
York 10043, in same day funds. Each Advance owing to the Lender by the Borrower
pursuant to the Credit Agreement, and all payments made on account of principal
thereof, shall be recorded by the Lender and, prior to any transfer hereof,
endorsed on the grid attached hereto which is part of this Promissory Note.

          This Promissory Note is one of the Notes referred to in, and is
entitled to the benefits of, the Credit Agreement. The Credit Agreement, among
other things, (i) provides for the making of Advances by the Lender to the
Borrower from time to time in an aggregate amount not to exceed at any time
outstanding the U.S. dollar amount first above mentioned, the indebtedness of
the Borrower resulting from each such Advance being evidenced by this Promissory
Note, and (ii) contains provisions for acceleration of the maturity hereof upon
the happening of certain stated events and also for prepayments on account of
principal hereof prior to the maturity hereof upon the terms and conditions
therein specified.

BAUSCH & LOMB INCORPORATED

By_______________________________________
Title

 

ADVANCES AND PAYMENTS OF PRINCIPAL

Date

Amount of Advance

Amount of Principal Paid or Prepaid

Unpaid Principal Balance

Notation Made By

                                                                               
                                                                               
                                                                               
         

EXHIBIT B - FORM OF
NOTICE OF BORROWING

Citibank, N.A., as Agent
for the Lenders parties
to the Credit Agreement
referred to below
Two Penns Way
New Castle, Delaware 19720                                            [Date]

                           Attention: Bank Loans Syndication Department

Ladies and Gentlemen:

          The undersigned, Bausch & Lomb Incorporated, refers to the Credit
Agreement, dated as of January 19, 2001 (as amended or modified from time to
time, the "Credit Agreement", the terms defined therein being used herein as
therein defined), among the undersigned, certain Lenders parties thereto,
Salomon Smith Barney Inc., as arranger, Fleet National Bank, as documentation
agent, The Chase Manhattan Bank, as syndication agent, and Citibank, N.A., as
Agent for said Lenders, and hereby gives you notice, irrevocably, pursuant to
Section 2.02 of the Credit Agreement that the undersigned hereby requests a
Borrowing under the Credit Agreement, and in that connection sets forth below
the information relating to such Borrowing (the "Proposed Borrowing") as
required by Section 2.02(a) of the Credit Agreement:

(i)

The Business Day of the Proposed Borrowing is _______________, 20__.

(ii)

The Type of Advances comprising the Proposed Borrowing is [Base Rate Advances]
[Eurodollar Rate Advances].

(iii)

The aggregate amount of the Proposed Borrowing is $_______________.

(iv)

[The initial Interest Period for each Eurodollar Rate Advance made as part of
the Proposed Borrowing is __________ month[s].]

The undersigned hereby certifies that the following statements are true on the
date hereof, and will be true on the date of the Proposed Borrowing:

(A)

the representations and warranties contained in Section 4.01 of the Credit
Agreement are correct, before and after giving effect to the Proposed Borrowing
and to the application of the proceeds therefrom, as though made on and as of
such date; and

(B)

no event has occurred and is continuing, or would result from such Proposed
Borrowing or from the application of the proceeds therefrom, that constitutes a
Default.

Very truly yours,

BAUSCH & LOMB INCORPORATED

By_______________________________________
Title:

EXHIBIT C - FORM OF
ASSIGNMENT AND ACCEPTANCE

          Reference is made to the Credit Agreement dated as of January 19, 2001
(as amended or modified from time to time, the "Credit Agreement") among Bausch
& Lomb Incorporated, a New York corporation (the "Borrower"), the Lenders (as
defined in the Credit Agreement), Salomon Smith Barney Inc., as arranger, Fleet
National Bank, as documentation agent, The Chase Manhattan Bank, as syndication
agent, and Citibank, N.A., as administrative agent for the Lenders (the
"Agent"). Terms defined in the Credit Agreement are used herein with the same
meaning.

          The "Assignor" and the "Assignee" referred to on Schedule 1 hereto
agree as follows:

1.

The Assignor hereby sells and assigns to the Assignee, and the Assignee hereby
purchases and assumes from the Assignor, an interest in and to the Assignor's
rights and obligations under the Credit Agreement as of the date hereof equal to
the percentage interest specified on Schedule 1 hereto of all outstanding rights
and obligations under the Credit Agreement. After giving effect to such sale and
assignment, the Assignee's Commitment and the amount of the Advances owing to
the Assignee will be as set forth on Schedule 1 hereto.

2.

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 furnished pursuant
thereto; (iii) makes no representation or warranty and assumes no responsibility
with respect to the financial condition of the Borrower or the performance or
observance by the Borrower of any of its obligations under the Credit Agreement
or any other instrument or document furnished pursuant thereto[; and
(iv) attaches the Note held by the Assignor and requests that the Agent exchange
such Note for a new Note payable to the order of the Assignee in an amount equal
to the Commitment assumed by the Assignee pursuant hereto or new Notes payable
to the order of the Assignee in an amount equal to the Commitment assumed by the
Assignee pursuant hereto and the Assignor in an amount equal to the Commitment
retained by the Assignor under the Credit Agreement, respectively, as specified
on Schedule 1 hereto].

3.

The Assignee (i) confirms that it has received a copy of the Credit Agreement,
together with copies of the financial statements referred to in Section 4.01
thereof and such other documents and information as it has deemed appropriate to
make its own credit analysis and decision to enter into this Assignment and
Acceptance; (ii) agrees that it will, independently and without reliance upon
the Agent, the Assignor or any other Lender 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 the Credit Agreement;
(iii) confirms that it is an Eligible Assignee; (iv) appoints and authorizes the
Agent to take such action as agent on its behalf and to exercise such powers and
discretion under the Credit Agreement as are delegated to the Agent by the terms
thereof, together with such powers and discretion as are reasonably incidental
thereto; (v)  agrees that it will perform in accordance with their terms all of
the obligations that by the terms of the Credit Agreement are required to be
performed by it as a Lender; and (vi) attaches any U.S. Internal Revenue Service
forms required under Section 2.13 of the Credit Agreement.

4.

Following the execution of this Assignment and Acceptance, it will be delivered
to the Agent for acceptance and recording by the Agent. The effective date for
this Assignment and Acceptance (the "Effective Date") shall be the date of
acceptance hereof by the Agent, unless otherwise specified on Schedule 1 hereto.

5.

Upon such acceptance and recording by the Agent, as of the Effective Date,
(i) the Assignee shall be a party to the Credit Agreement and, to the extent
provided in this Assignment and Acceptance, have the rights and obligations of a
Lender thereunder and (ii) the Assignor shall, to the extent provided in this
Assignment and Acceptance, relinquish its rights and be released from its
obligations under the Credit Agreement.

6.

Upon such acceptance and recording by the Agent, from and after the Effective
Date, the Agent shall make all payments under the Credit Agreement and the Notes
in respect of the interest assigned hereby (including, without limitation, all
payments of principal, interest and facility fees with respect thereto) to the
Assignee. The Assignor and Assignee shall make all appropriate adjustments in
payments under the Credit Agreement and the Notes for periods prior to the
Effective Date directly between themselves.

7.

This Assignment and Acceptance shall be governed by, and construed in accordance
with, the laws of the State of New York.

8.

This Assignment and Acceptance may be executed in any number of counterparts and
by different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement. Delivery of an executed counterpart of
Schedule 1 to this Assignment and Acceptance by telecopier shall be effective as
delivery of a manually executed counterpart of this Assignment and Acceptance.

          IN WITNESS WHEREOF, the Assignor and the Assignee have caused
Schedule 1 to this Assignment and Acceptance to be executed by their officers
thereunto duly authorized as of the date specified thereon.

Schedule 1
to
Assignment and Acceptance

Percentage interest assigned:

 

_____%

Assignee's Commitment:

$_______________

 

Aggregate outstanding principal amount of Advances assigned:

$_______________

 

Principal amount of Note payable to Assignee:

$_______________

 

Principal amount of Note payable to Assignor:

$_______________

 

Effective Date1: _______________, 200_

   

 

[NAME OF ASSIGNOR], as Assignor

By________________________________________
     Title:

Dated: _______________, 200_

[NAME OF ASSIGNEE], as Assignee

By________________________________________
     Title:

Domestic Lending Office:
      [Address]

Eurodollar Lending Office:
      [Address]

Accepted [and Approved]2 this
__________ day of _______________, 200_

CITIBANK, N.A., as Agent

By_______________________________
     Title:

[Approved this __________ day of _______________, 200_

 

 

 

1

This date should be no earlier than five Business Days after the delivery of
this Assignment and Acceptance to the Agent.

   

2

Required if the Assignee is an Eligible Assignee soley by reason of clause (iii)
of the definition of "Eligible Assignee".

 

 

 

 

 

BAUSCH & LOMB INCORPORATED

By_______________________________1
     Title:

 

1     Required if the Assignee is an Eligible Assignee solely by reason of
clause (iii) of the
      definition to "Eligible Assignee".

 

 

 

January 19, 2001

To each of the Lenders parties
to the Credit Agreement dated
as of January 19, 2001
among Bausch & Lomb Incorporated,
said Lenders and Citibank, N.A.,
as Agent for said Lenders, and
to Citibank, N.A., as Agent

Bausch & Lomb Incorporated

Ladies and Gentlemen:

          This opinion is furnished to you pursuant to Section 3.01(h)(iv) of
the Credit Agreement, dated as of January 19, 2001 (the "Credit Agreement"),
among Bausch & Lomb Incorporated (the "Borrower"), the Lenders parties thereto,
Salomon Smith Barney Inc., as arranger, Fleet National Bank, as documentation
agent, The Chase Manhattan Bank, as syndication agent, and Citibank, N.A., as
Agent for said Lenders. Terms defined in the Credit Agreement are used herein as
therein defined.

          I am Senior Counsel for the Borrower, and in that capacity, I am
familiar with the preparation, execution and delivery of the Credit Agreement.

          In that connection, we have examined:

(1)

The Credit Agreement.

(2)

The documents furnished by the Borrower pursuant to Article III of the Credit
Agreement.

(3)

The Certificate of Incoporation of the Borrower and all amendments thereto (the
"Charter").

(4)

The by-laws of the Borrower and all amendments thereto (the "By-laws").

(5)

A certificate of the Secretary of State of New York, dated January 16, 2001,
attesting to the continued corporate existence and good standing of the Borrower
in that State.

I have also examined the originals, or copies certified to my satisfaction, of
such other corporate records of the Borrower, certificates of public officials
and of officers of the Borrower, and agreements, instruments and other
documents, as I have deemed necessary as a basis for the opinions expressed
below. As to questions of fact material to such opinions, I have, when
relevevant facts were not independently established by me, relied upon
statements of the Borrower or its officers or of public officials. I have
assumed the due execution and delivery, pursuant to due authorization, of the
Credit Agreement by the Initial Lenders and the Agent.

          The opinions expressed below are limited to the law of the State of
New York and the Federal law of the United States.

          Based upon the foregoing and upon such investigation as I have deemed
necessary, I am of the following opinion:

1.

The Borrower is a corporation duly organized, validly existing and in good
standing under the laws of the State of New York.

2.

The execution, delivery and performance by the Borrower of the Credit Agreement
and the Notes, and the consummation of the transactions contemplated thereby,
are within the Borrower's corporate powers, have been duly authorized by all
necessary corporate action, and do not contravene (i) the Charter or the By-laws
or (ii) any law, rule or regulation applicable to the Borrower (including,
without limitation, Regulation X of the Board of Governors of the Federal
Reserve System) or (iii) any contractual or legal restriction contained in any
document listed in the Certificate or, to the best of our knowledge, contained
in any "material contract" of the Company, as such term is defined pursuant to
the Securities Exchange Act of 1934. The Credit Agreement and the Notes have
been duly executed and delivered on behalf of the Borrower.

3.

No authorization, approval or other action by, and no notice to or filing with,
any governmental authority or regulatory body or any other third party is
required for the due execution, delivery and performance by the Borrower of the
Credit Agreement and the Notes.

4.

The Credit Agreement is, and after giving effect to the initial Borrowing, the
Notes will be, legal, valid and binding obligations of the Borrower enforceable
against the Borrower in accordance with their respective terms.

5.

To the best of our knowledge, there are no pending or overtly threatened actions
or proceedings against the Borrower or any of its Subsidiaries before any court,
governmental agency or arbitrator that purport to affect the legality, validity,
binding effect or enforceability of the Credit Agreement or any of the Notes or
the consummation of the transactions contemplated thereby or, except as
described in the Company's filings with the Securities and Exchange Commission
pursuant to the Securities Act of 1933 and the Securities Exchange Act of 1934,
that are likely to have a materially adverse effect upon the financial condition
or operations of the Borrower or any of its Subsidiaries.

          The opinions set forth above are subject to the following
qualifications:

(a)

The opinion in paragraph 4 above as to enforceability is subject to the effect
of any applicable bankruptcy, insolvency (including, without limitation, all
laws relating to fraudulent transfers), reorganization, moratorium or similar
law affecting creditors' rights generally.

(b)

The opinion in paragraph 4 above as to enforceability is subject to the effect
of general principles of equity, including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing (regardless of whether
considered in a proceeding in equity or at law).

(c)

No opinion is expressed as to (i) Section 2.14 of the Credit Agreement insofar
as it provides that any Lender purchasing a participation from another Lender
pursuant thereto may exercise set-off or similar rights with respect to such
participation and (ii) the effect of the law of any jurisdiction other than the
State of New York wherein any Lender may be located or wherein enforcement of
the Credit Agreement or the Notes may be sought, including, without limitation,
any such law that limits the rates of interest legally chargeable or
collectible.

Very truly yours,

/s/________________________

A. Robert D. Bailey
ARDB/jd

 

 

BAUSCH & LOMB INCORPORATED

OFFICER'S CERTIFICATE

(Three Year Credit Agreement)

 

 

          This Certificate is given by Alan H. Resnick, Vice President and
Treasurer of BAUSCH & LOMB INCORPORATED, a New York corporation (the
"Borrower"), pursuant to Section 3.02 of the Three Year Credit Agreement, dated
as of January 19, 2001, between and among the Borrower, the Lenders party
thereto, SALOMON SMITH BARNEY INC., as arranger, FLEET NATIONAL BANK, as
documentation agent, THE CHASE MANHATTAN BANK, as syndication agent, and
CITIBANK, N.A., as administrative agent, (the "Credit Agreement"). Capitalized
terms not otherwise defined in this Certificate shall have the meaning
attributed to them in the Credit Agreement. The undersigned hereby certifies
that, to the best of his knowledge:

1.

The representations and warranties of the Borrower in Section 4.01 of the Credit
Agreement are true and correct as of the date hereof; and

2.

As of the date hereof, there is no Default which has occurred and is continuing.

          IN WITNESS WHEREOF, the undersigned has signed and delivered this
certificate pursuant to the Credit Agreement

Dated: January 19, 2001

 

/s/______________________________

Alan H. Resnick
Vice President and Treasurer

                                               One Bausch & Lomb
Place                                     716 338 6010
                                                Rochester NY
14604-2701                                     Fax 716 338 8706

 

Jean F. Geisel
Corporate Secretary

 

CERTIFICATION

 

          I, Jean F. Geisel, Secretary of Bausch & Lomb Incorporated ("the
Company"), a New York Corporation, do hereby certify that on April 22, 1986, the
Board of Directors of the Company elected Alan H. Resnick as Vice President and
Treasurer of the Company and that he has duly held such office at all times from
April 22, 1986, to and including the date hereof, and has full power and
authority to act on behalf of the Company;

          And I further certify that the following resolution was adopted at a
meeting of the Board of Directors of said Company on December 14, 1993, that a
quorum was at all times present and acting, that the passage of said resolution
was in all respects legal, and that said resolution is in full force and effect
as of the date hereof:

          RESOLVED:

That the Chairman of the Board, the President, the Vice President - Finance, the
Treasurer and the Assistant Treasurer are each authorized to do the following
for this Company:

1.

To open and maintain bank accounts in any bank he may select for the deposit of
the funds of this Company by its officers, agents and employees, and to
designate those officers and other employees of the Company who may sign checks,
drafts and other instruments having to do with the receipt, deposit and
disbursement of such funds in connection with each of said bank accounts, and
any bank shall be authorized to honor such checks, drafts and other instruments
including when drawn to the individual order of any person whose name appears
thereon as signer;

   

2.

To specify the circumstances, if any, under which facsimile signatures may be
used on checks written on said accounts, and any bank shall be authorized to
honor such checks regardless of by whom or by what means the actual or purported
facsimile signature thereon may have been affixed thereto if such facsimile
signature resembles the facsimile specimens from time to time with said bank;

   

3.

To apply for the issuance of letters of credit of any nature, including those
utilizing Bankers' acceptances up to 120 days for short term financing, in favor
of such beneficiaries as to him seem advisable, and in connection therewith to
execute and deliver such instructions, agreements and other documents as may be
necessary or desirable;

   

4.

To arrange for the rental by the Company of safe deposit boxes or the use of
night depository boxes, and to sign any agreements and other documents relating
thereto; and

   

5.

To specify the circumstances under which instructions to, or information, from,
banks or other financial institutions, including the making or authorizing of
payments, transfers, or other orders, may be made by electronic or similar
means.

   

6.

To execute and deliver on behalf of the Company any other instructions,
agreements, hypothecations, pledges, assignments, indemnities, guarantees, trust
receipts, statements and any other documents or instruments relating to the
banking affairs of the Company.

In witness whereof, I have hereto set my hand this 19th day of January 2001.

/s/_____________________________

Jean F. Geisel
Secretary

 

 

                                               One Bausch & Lomb
Place                                     716 338 6010
                                                Rochester NY
14604-2701                                     Fax 716 338 8706

 

Jean F. Geisel
Corporate Secretary

 

 

CERTIFICATION OF INCUMBENCY

 

 

          I, Jean F. Geisel, Secretary of Bausch & Lomb Incorporated ("the
Company"), a New York Corporation, do hereby certify that on April 22, 1986, the
board of Directors of the Company elected Alan H. Resnick as Vice President and
Treasurer of the Company, that he has duly held such office at all times since
April 22, 1986, to and including the date hereof, and that he has full power and
authority to act on behalf of the Company.

          In witness whereof, I have hereto set my hand this 19th day of January
2001.

 

/s/__________________________

              Jean F. Geisel
              Secretary

 

SHERMAN & STERLING

FAX:  212-848-7179

599 LEXINGTON AVENUE

ABU DJABI

TELEX:  667290 WUI

NEW YORK, N.Y. 10022-6069

BEIJING

212 848-4000

DUSSELDORF

FRANKFURT

January 19, 2001

HONG KONG

WRITER'S DIRECT NUMBER:

LONDON

MENLO PARK

NEW YORK

To the Initial Lenders party to the

PARIS

    Credit Agreement referred to

SAN FRANCISCO

    below and to Citibank, N.A., as

SINGAPORE

    Agent

TOKYO

TORONTO

WASHINGTON, D.C.

Ladies and Gentlemen:

We have acted as special New York counsel to Citibank, N.A., as Agent, in
connection with the preparation, execution and delivery of the Three Year Credit
Agreement dated as of January 19, 2001 (the "Credit Agreement"), among Bausch &
Lomb Incorporated, a Delaware corporation (the "Borrower"), and each of you
(each a "Lender"). Unless otherwise defined herein, terms defined in the Credit
Agreement are used herein as therein defined.

In that connection, we have examined a counterpart of the Credit Agreement
executed by the Borrower, the Revolving Credit Notes executed by the Borrower
and delivered on the date hereof (for purposes of this opinion letter, the
"notes") and, to the extent relevant to our opinion expressed below, the other
documents delivered by the Borrower pursuant to Section 3.01 of the Credit
Agreement.

In our examination of the Credit Agreement, the Notes and such other documents,
we have assumed, without independent investigation (a) the due execution and
delivery of the Credit Agreement by all parties thereto and of the Notes by the
Borrower, (b) the genuineness of all signatures, (c) the authenticity of the
originals of the documents submitted to us and (d) the conformity to originals
of any documents submitted to us as copies.

In addition, we have assumed, without independent investigation, that (i) the
Borrower is duly organized and validly existing under the laws of the
jurisdiction of its organization and has full power and authority (corporate and
otherwise) to execute, deliver and perform the Credit Agreement and the Notes
and (ii) the execution, delivery and performance by the Borrower of the Credit
Agreement and the Notes have been duly authorized by all necessary action
(corporate or otherwise) and do not (A) contravene the certificate of
incorporation, bylaws or other constituent documents of the Borrower, (B)
conflict with or result in the breach of any document or instrument binding on
the Borrower or (C) violate or require any governmental or regulatory
authorization or other action under any law, rule or regulation applicable to
the Borrower other than New York law or United States federal law applicable to
borrowers generally or, assuming the correctness of the Borrower's statements
made as representations and warranties in Section 4.01(c) of the Credit
Agreement, applicable to the Borrower. We have also assumed that the Credit
Agreement is the legal, valid and binding obligation of each Lender, enforceable
against such Lender in accordance with its terms.

Based upon the foregoing examination and assumptions and upon such other
investigation as we have deemed necessary and subject to the qualifications set
forth below, we are of the opinion that the Credit Agreement and each of the
Notes are the legal, valid and binding obligations of the Borrower, enforceable
against the Borrower in accordance with their respective terms.

Our opinion is subject to the following qualifications:

(i)

Our opinion above is subject to the effect of any applicable bankruptcy,
insolvency (including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or similar law affecting creditors'
rights generally.

(ii)

Our opinion above is also subject to the effect of general principles of equity,
including (without limitation) concepts of materiality, reasonableness, good
faith and fair dealing (regardless of whether considered in a proceeding in
equity or at law).

(iii)

We express no opinion as to the enforceability of the indemnification provisions
set forth in Section 9.04 of the Credit Agreement to the extent enforcement
thereof is contrary to public policy regarding the exculpation of criminal
violations, intentional harm and acts of gross negligence or recklessness.

(iv)

Our opinion above is limited to the law of the State of New York and the federal
law of the United States of America and we do not express any opinion herein
concerning any other law. Without limiting the generality of the foregoing, we
express no opinion as to the effect of the law of a jurisdiction other than the
State of New York wherein any Lender may be located or wherein enforcement of
the Credit Agreement or any of the Notes may be sought that limits the rates of
interest legally chargeable or collectible.

A copy of this opinion letter may be delivered by any of you to any Person that
becomes a Lender in accordance with the provisions of the Credit Agreement. Any
such Lender may rely on the opinion expressed above as if this opinion letter
were addressed and delivered to such Lender on the date hereof.

This opinion letter speaks only as of the date hereof. We expressly disclaim any
responsibility to advise you or any other Lender who is permitted to rely on the
opinion expressed herein as specified in the next preceding paragraph of any
development or circumstance of any kind including any change of law or fact that
may occur after the date of this opinion letter even though such development,
circumstance or change may affect the legal analysis, a legal conclusion or any
other matter set forth in or relating to this opinion letter. Accordingly, any
Lender relying on this opinion letter at any time should seek advice of its
counsel as to the proper application of this opinion letter at such time.

Very truly yours,

 

/s/________________________

Sherman & Sterling

 

WEH:SLH