Exhibit 10.4


 


CREDIT
AGREEMENT


Dated as of
November 14, 2006


among


FUND AMERICAN COMPANIES, INC.


as the Borrower,


ONEBEACON INSURANCE GROUP, LTD.,


as Parent,


BANK OF
AMERICA, N.A.,

as Administrative Agent, Swing Line Lender and

Issuing Lender,


and


THE OTHER
LENDERS PARTY HERETO


LEHMAN
BROTHERS INC.,

as Syndication Agent


and


JPMORGAN
CHASE BANK, N.A.,


THE BANK
OF NEW YORK,


THE BANK
OF TOKYO-MITSUBISHI UFJ. LTD., NEW YORK BRANCH,


and


DEUTSCHE
BANK AG NEW YORK BRANCH


as Co-Documentation Agents


and


BANC OF AMERICA SECURITIES LLC,


and


LEHMAN BROTHERS INC.

as Joint Lead Arrangers and Joint Book Runners


 


 



   
 















 


TABLE OF CONTENTS


 


 


	
  1.

  	
  DEFINITIONS

  	
   

  	
   

  
	
   

  	
  1.1.

  	
  Defined Terms

  	
   

  	
   

  
	
   

  	
  1.2.

  	
  Other Definitional Provisions

  	
   

  	
   

  
	
   

  	
  1.3.

  	
  Letter of Credit Amounts

  	
   

  	
   

  
	
   

  	
  1.4.

  	
  Rounding

  	
   

  	
   

  
	
   

  	
  1.5.

  	
  Times of Day

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
  AMOUNT AND TERMS OF COMMITMENTS

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.1.

  	
  Revolving Credit Commitments

  	
   

  	
   

  
	
   

  	
  2.2.

  	
  Procedure for Revolving Credit Borrowing

  	
   

  	
   

  
	
   

  	
  2.3.

  	
  Swing Line Commitment

  	
   

  	
   

  
	
   

  	
  2.4.

  	
  Procedure for Swing Line Borrowing; Refunding of
  Swing Line Loans

  	
   

  	
   

  
	
   

  	
  2.5.

  	
  Repayment of Loans; Evidence of Debt

  	
   

  	
   

  
	
   

  	
  2.6.

  	
  Facility Fee, etc

  	
   

  	
   

  
	
   

  	
  2.7.

  	
  Termination or Reduction of Revolving Credit
  Commitments

  	
   

  	
   

  
	
   

  	
  2.8.

  	
  Prepayments

  	
   

  	
   

  
	
   

  	
  2.9.

  	
  Conversion and Continuation Options

  	
   

  	
   

  
	
   

  	
  2.10.

  	
  Maximum Number of Eurodollar Loans

  	
   

  	
   

  
	
   

  	
  2.11.

  	
  Interest Rates and Payment Dates

  	
   

  	
   

  
	
   

  	
  2.12.

  	
  Computation of Interest and Fees

  	
   

  	
   

  
	
   

  	
  2.13.

  	
  Inability to Determine Interest Rate

  	
   

  	
   

  
	
   

  	
  2.14.

  	
  Pro Rata Treatment and Payments

  	
   

  	
   

  
	
   

  	
  2.15.

  	
  Requirements of Law

  	
   

  	
   

  
	
   

  	
  2.16.

  	
  Taxes

  	
   

  	
   

  
	
   

  	
  2.17.

  	
  Compensation for Losses

  	
   

  	
   

  
	
   

  	
  2.18.

  	
  Illegality

  	
   

  	
   

  
	
   

  	
  2.19.

  	
  Change of Office

  	
   

  	
   

  
	
   

  	
  2.20.

  	
  Replacement of Lenders under Certain Circumstances

  	
   

  	
   

  
	
   

  	
  2.21.

  	
  Guaranty of Payment and Performance

  	
   

  	
   

  
	
   

  	
  2.22.

  	
  Increase in Commitments

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
  LETTERS OF CREDIT

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.1.

  	
  L/C Commitment

  	
   

  	
   

  
	
   

  	
  3.2.

  	
  Procedure for Issuance and Amendment of Letter of Credit

  	
   

  	
   

  
	
   

  	
  3.3.

  	
  Drawings and Reimbursements; Funding of
  Participations

  	
   

  	
   

  
	
   

  	
  3.4.

  	
  Repayment of Participations

  	
   

  	
   

  
	
   

  	
  3.5.

  	
  Obligations Absolute

  	
   

  	
   

  
	
   

  	
  3.6.

  	
  Role of Issuing Lender

  	
   

  	
   

  



 



 i
 









 


	
  

  	
  3.7.

  	
  Cash Collateral

  	
   

  	
   

  
	
   

  	
  3.8.

  	
  Applicability of ISP98 and UCP

  	
   

  	
   

  
	
   

  	
  3.9.

  	
  Fees and Other Charges

  	
   

  	
   

  
	
   

  	
  3.10.

  	
  Conflict with Issuer Documents

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
  CONDITIONS PRECEDENT

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.

  	
  Conditions to Closing

  	
   

  	
   

  
	
   

  	
  4.2.

  	
  Conditions to Closing and Each Extension of Credit

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
  REPRESENTATIONS AND WARRANTIES

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.

  	
  Financial Statements

  	
   

  	
   

  
	
   

  	
  5.2.

  	
  Corporate Existence; Compliance with Law

  	
   

  	
   

  
	
   

  	
  5.3.

  	
  Corporate Power; Authorization; Enforceable
  Obligations

  	
   

  	
   

  
	
   

  	
  5.4.

  	
  No Legal Bar

  	
   

  	
   

  
	
   

  	
  5.5.

  	
  No Material Litigation

  	
   

  	
   

  
	
   

  	
  5.6.

  	
  Ownership of Property; Liens

  	
   

  	
   

  
	
   

  	
  5.7.

  	
  Intellectual Property

  	
   

  	
   

  
	
   

  	
  5.8.

  	
  Taxes

  	
   

  	
   

  
	
   

  	
  5.9.

  	
  Federal Regulations

  	
   

  	
   

  
	
   

  	
  5.10.

  	
  ERISA

  	
   

  	
   

  
	
   

  	
  5.11.

  	
  Investment Company Act; Other Regulations

  	
   

  	
   

  
	
   

  	
  5.12.

  	
  Use of Proceeds

  	
   

  	
   

  
	
   

  	
  5.13.

  	
  Accuracy of Information, etc

  	
   

  	
   

  
	
   

  	
  5.14.

  	
  Insurance Regulatory Matters

  	
   

  	
   

  
	
   

  	
  5.15.

  	
  Indebtedness and Liens

  	
   

  	
   

  
	
   

  	
  5.16.

  	
  Taxpayer Identification Number

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
  AFFIRMATIVE COVENANTS

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.1.

  	
  Financial Statements

  	
   

  	
   

  
	
   

  	
  6.2.

  	
  Certificates; Other Information

  	
   

  	
   

  
	
   

  	
  6.3.

  	
  Payment of Obligations

  	
   

  	
   

  
	
   

  	
  6.4.

  	
  Conduct of Business and Maintenance of Existence,
  etc

  	
   

  	
   

  
	
   

  	
  6.5.

  	
  Maintenance of Property; Insurance

  	
   

  	
   

  
	
   

  	
  6.6.

  	
  Inspection of Property; Books and Records;
  Discussions

  	
   

  	
   

  
	
   

  	
  6.7.

  	
  Notices

  	
   

  	
   

  
	
   

  	
  6.8.

  	
  Taxes

  	
   

  	
   

  
	
   

  	
  6.9.

  	
  Use of Proceeds

  	
   

  	
   

  
	
   

  	
  6.10.

  	
  Further Assurances

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.

  	
  NEGATIVE COVENANTS

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.1.

  	
  Financial Condition Covenants

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  




 ii
 









 


	
  

  	
  7.2.

  	
  Limitation on Indebtedness and Issuance of Preferred
  Stock

  	
   

  	
   

  
	
   

  	
  7.3.

  	
  Limitation on Liens

  	
   

  	
   

  
	
   

  	
  7.4.

  	
  Limitation on Changes in Fiscal Periods

  	
   

  	
   

  
	
   

  	
  7.5.

  	
  Limitation on Lines of Business

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.

  	
  EVENTS OF DEFAULT

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  8.1.

  	
  Events of Default

  	
   

  	
   

  
	
   

  	
  8.2.

  	
  Remedies Upon Event of Default

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.

  	
  THE ADMINISTRATIVE AGENT

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  9.1.

  	
  Appointment

  	
   

  	
   

  
	
   

  	
  9.2.

  	
  Delegation of Duties

  	
   

  	
   

  
	
   

  	
  9.3.

  	
  Liability of Administrative Agent

  	
   

  	
   

  
	
   

  	
  9.4.

  	
  Reliance by Administrative Agent

  	
   

  	
   

  
	
   

  	
  9.5.

  	
  Notice of Default

  	
   

  	
   

  
	
   

  	
  9.6.

  	
  Credit Decision; Disclosure of Information by
  Administrative Agent

  	
   

  	
   

  
	
   

  	
  9.7.

  	
  Indemnification of Administrative Agent

  	
   

  	
   

  
	
   

  	
  9.8.

  	
  Administrative Agent in its Individual Capacity

  	
   

  	
   

  
	
   

  	
  9.9.

  	
  Successor Administrative Agent

  	
   

  	
   

  
	
   

  	
  9.10.

  	
  Administrative Agent May File Proofs of Claim

  	
   

  	
   

  
	
   

  	
  9.11.

  	
  Guarantee and Collateral Matters

  	
   

  	
   

  
	
   

  	
  9.12.

  	
  Other Agents; Arrangers and Managers

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  10.

  	
  MISCELLANEOUS

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.1.

  	
  Amendments, Etc

  	
   

  	
   

  
	
   

  	
  10.2.

  	
  Notices; Effectiveness; Electronic Communication

  	
   

  	
   

  
	
   

  	
  10.3.

  	
  No Waiver; Cumulative Remedies

  	
   

  	
   

  
	
   

  	
  10.4.

  	
  Survival of Representations and Warranties

  	
   

  	
   

  
	
   

  	
  10.5.

  	
  Attorney Costs and Expenses

  	
   

  	
   

  
	
   

  	
  10.6.

  	
  Indemnification

  	
   

  	
   

  
	
   

  	
  10.7.

  	
  Successors and Assigns

  	
   

  	
   

  
	
   

  	
  10.8.

  	
  Adjustments; Set-off

  	
   

  	
   

  
	
   

  	
  10.9.

  	
  Counterparts

  	
   

  	
   

  
	
   

  	
  10.10.

  	
  Severability

  	
   

  	
   

  
	
   

  	
  10.11.

  	
  Integration

  	
   

  	
   

  
	
   

  	
  10.12.

  	
  GOVERNING LAW

  	
   

  	
   

  
	
   

  	
  10.13.

  	
  SUBMISSION TO JURISDICTION; WAIVERS

  	
   

  	
   

  
	
   

  	
  10.14.

  	
  WAIVERS OF JURY TRIAL

  	
   

  	
   

  
	
   

  	
  10.15.

  	
  No Advisory or Fiduciary Responsibility

  	
   

  	
   

  
	
   

  	
  10.16.

  	
  Confidentiality

  	
   

  	
   

  
	
   

  	
  10.17.

  	
  Release of Guarantee Obligations

  	
   

  	
   

  
						




 iii
 









 


	
  

  	
  10.18.

  	
  Accounting Changes

  	
   

  	
   

  
	
   

  	
  10.19.

  	
  USA PATRIOT Act Notice

  	
   

  	
   

  
	
   

  	
  10.20.

  	
  Interest Rate Limitation

  	
   

  	
   

  




 iv
 









 


	
  SCHEDULES:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  1

  	
   

  	
  Commitment Schedule

  
	
  1A

  	
   

  	
  Existing Letters of Credit

  
	
  5.3

  	
   

  	
  Consents, Authorizations, Filings and Notices

  
	
  10.2

  	
   

  	
  Notice Addresses

  
	
   

  	
   

  	
   

  
	
  EXHIBITS:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  A

  	
   

  	
  Form of Compliance Certificate

  
	
  B-1

  	
   

  	
  Form of Borrowing Request

  
	
  B-2

  	
   

  	
  Form of Swing Line Loan Notice

  
	
  C-1

  	
   

  	
  Form of Revolving Credit Note

  
	
  C-2

  	
   

  	
  Form of Swing Line Note

  
	
  D

  	
   

  	
  Form of Exemption Certificate

  
	
  E

  	
   

  	
  Form of Closing Certificate

  
	
  F-1

  	
   

  	
  Form of Legal Opinion of Thomas Forsyth, Esq.

  
	
  F-2

  	
   

  	
  Form of Legal Opinion of Robert Seelig, Esq.

  
	
  G

  	
   

  	
  Form of Legal Opinion of Conyers Dill & Pearman

  
	
  H

  	
   

  	
  Form of Assignment and Assumption

  
	
  I

  	
   

  	
  Form of Instrument of Accession

  



 



 v















CREDIT
AGREEMENT


This CREDIT AGREEMENT, dated as of November 14,
2006, among (i) FUND AMERICAN COMPANIES, INC., a
Delaware corporation (the “Borrower”), (ii) ONEBEACON
INSURANCE GROUP, LTD., a company existing under the laws of Bermuda
(“Parent” and, together with the Borrower, collectively, the “Loan
Parties” and, individually, a “Loan Party”), (iii) each lender from
time to time party hereto (collectively, the “Lenders”), (iv) BANK OF AMERICA, N.A., as Administrative
Agent, Swing Line Lender and the Issuing Lender and (v) LEHMAN BROTHERS INC., as Syndication Agent.


PRELIMINARY STATEMENTS


The Borrower has
requested that the Lenders provide a revolving credit facility, and the Lenders
are willing to do so on the terms and conditions set forth herein.


In consideration of the
mutual covenants and agreements herein contained, the parties hereto covenant
and agree as follows:


1.             DEFINITIONS


1.1.  Defined Terms.  As used in this Agreement, the terms listed
in this Section  1.1 shall have the respective meanings set forth
in this Section 1.1.


“Act of 1934”
means the Securities Exchange Act of 1934 and the regulations issued
thereunder.


“Administrative
Agent” means Bank of America, N.A., in its capacity as administrative agent
under any of the Loan Documents, or any successor administrative agent
appointed in accordance with Section 9.9.


“Administrative
Agent’s Office” means the Administrative Agent’s address and, as
appropriate, account as set forth on Schedule 10.2, or such other
address or account as the Administrative Agent may from time to time notify the
Borrower and the Lenders.


“Administrative
Questionnaire” means an Administrative Questionnaire in a form supplied by
the Administrative Agent.


“Affiliate”
means, as to any Person, any other Person that, directly or indirectly, is in
control of, is controlled by, or is under common control with, such
Person.  For purposes of this definition,
“control” of a Person means the power, directly or indirectly, either to (a)
vote 10% or more of the securities having ordinary voting power for the
election of directors (or persons performing similar functions) of such Person
or (b) direct or cause the direction of the management and policies of such
Person, whether by contract or otherwise.



   
 









“Agent Fee
Letter” means that certain letter agreement dated as of November 14, 2006
by and between Borrower, White Mountains, White Mountains Re, the
Administrative Agent and Banc of America Securities LLC.


“Agent-Related
Persons” means the Administrative Agent, together with its Affiliates
(including, Bank of America, N.A. in its capacity as the Administrative Agent
and Banc of America Securities LLC in its capacity as one of the Arrangers),
and the officers, directors, employees, agents and attorneys-in-fact of such
Persons and Affiliates.


“Agreement”
means this Credit Agreement, as amended, restated, extended, supplemented or
otherwise modified from time to time.


“Annual
Statement” means the annual statutory financial statement of any Insurance
Subsidiary required to be filed with the Department of its jurisdiction of
incorporation or organization, which statement shall be in the form required by
such Insurance Subsidiary’s jurisdiction of incorporation or organization or,
if no specific form is so required, in the form of financial statements
permitted by such Department to be used for filing annual statutory financial
statements and shall contain the type of information permitted or required by
such Department to be disclosed therein, together with all exhibits or
schedules filed therewith.


“Applicable
Margin” means the applicable percentage per annum set forth below
corresponding to the Debt Rating as set forth below.




	
  Pricing Level

  	
   

  	
  Debt Rating

  	
   

  	
  Applicable Margin

  
	
  I

  	
   

  	
  ≥A-/A3

  	
   

  	
  0.280%

  
	
  II

  	
   

  	
  BBB+/Baa1

  	
   

  	
  0.320%

  
	
  III

  	
   

  	
  BBB/Baa2

  	
   

  	
  0.400%

  
	
  IV

  	
   

  	
  BBB-/Baa3

  	
   

  	
  0.525%

  
	
  V

  	
   

  	
  <BBB-/Baa3

  	
   

  	
  0.675%

  






“Debt Rating” means, as of any date of
determination, the rating as determined by either S&P or Moody’s
(collectively, the “Debt Ratings”) of the Borrower’s non-credit enhanced
(other than through an unsecured guarantee by Parent), senior unsecured debt; provided
that (a) if the respective Debt Ratings issued by the foregoing rating
agencies differ by one level, then the pricing level of the higher Debt Rating
shall apply (with the Debt Rating of pricing level I being the highest and the
Debt Rating for pricing level V being the lowest), (b) in the event that there
is a split in Debt Rating of more than one level then the pricing level that is
one level lower than the pricing level of the higher Debt Rating shall apply,
(c) if the Borrower has only one Debt Rating, then the pricing level of that
Debt Rating shall apply, and (d) if the Borrower does not have any Debt 



 2
 









Rating, the Applicable Margin shall be that
corresponding to pricing level V; provided  that, so long as the only rated
senior unsecured debt of the Borrower is credit enhanced through a guarantee
provided by White Mountains, the Applicable Margin shall be that
corresponding to the pricing level
that is one level below the pricing level corresponding to such Debt Rating, if
there is a lower level.  For the
avoidance of doubt, if the only rated senior unsecured debt of the Borrower is
guaranteed by White Mountains and has a Debt Rating of BBB/Baa2, the applicable
pricing level shall be pricing level IV. 
Each change in the Applicable Margin resulting from a publicly
announced change in the Debt Rating shall be effective during the period
commencing on the date of the public announcement thereof and ending on the
date immediately preceding the effective date of the next such change.


“Application”
means an application and agreement for the issuance or amendment of a Letter of
Credit in the form from time to time used by the Issuing Lender, which shall
not be inconsistent with this Agreement or impose additional obligations on the
Borrower.


“Approved Fund”
means any Fund that is administered or managed by (a) a Lender, (b) an
Affiliate of a Lender or (c) an entity or an Affiliate of an entity that
administers or manages a Lender.


“Arranger Fee Letter”
means that certain letter agreement dated as of November 14, 2006 by and among
the Borrower, White Mountains, White Mountains Re, the Arrangers and LBB.


“Arrangers”
means Banc of America Securities LLC and Lehman Brothers Inc., in their
respective capacities as joint lead arrangers and joint book runners.


“Assignee Group”
means two or more Eligible Assignees that are Affiliates of one another or two
or more Approved Funds managed by the same investment advisor.


“Assignment and
Assumption” means an assignment and assumption entered into by a Lender and
an Eligible Assignee (with the consent of any party whose consent is required
by Section 10.7(b), and accepted by the Administrative Agent, in
substantially in the form of Exhibit H or any other form approved by the
Administrative Agent.


“Attorney Costs”
means and includes all reasonable fees, expenses and disbursements of any law
firm or other external counsel.


“Available
Revolving Credit Commitment” means, with respect to any Lender at any time,
an amount equal to the excess, if any, of (a) such Lender’s Revolving Credit
Commitment then in effect over (b) such Lender’s Revolving Extensions of
Credit then outstanding.


“Base Rate”
means, for any day, a fluctuating rate per annum equal to the higher of (a) the
Federal Funds Rate plus 1/2 of 1% and (b) the rate of interest in effect 



 3
 









for such day as publicly
announced from time to time by Bank of America, N.A. as its “prime rate.”  The “prime rate” is a rate set by Bank of
America, N.A. based upon various factors including Bank of America, N.A.’s
costs and desired return, general economic conditions and other factors, and is
used as a reference point for pricing some loans, which may be priced at,
above, or below such announced rate.  Any
change in such rate announced by Bank of America, N.A. shall take effect at the
opening of business on the day specified in the public announcement of such
change.


“Base Rate
Loans” means Loans for which the applicable rate of interest is based upon
the Base Rate.


“Benefitted
Lender” has the meaning specified in Section 10.8.


“Berkshire
Hathaway” means, Berkshire Hathaway Inc., or an Affiliate thereof.


“Berkshire
Preferred Stock” means the $300,000,000 aggregate liquidation preference
amount of non-voting preferred stock issued by the Borrower to Berkshire
Hathaway pursuant to the Certificate of Designation of Series A Preferred Stock
of TACK Acquisition Corp. (n/k/a Fund American Companies, Inc.) as amended,
supplemented or otherwise modified from time to time.


“Board”
means the Board of Governors of the Federal Reserve System of the United States
(or any successor).


“Borrower
Materials” has the meaning specified in Section 6.2(e).


“Borrower”
has the meaning specified in the preamble hereto.


“Borrowing Date”
means any Business Day specified by the Borrower as a date on which the
Borrower requests the relevant Lenders to make Loans hereunder.


“Borrowing
Request” means a notice of (a) a borrowing, (b) a conversion of Loans from
one Type to the other, or (c) a continuation of Eurodollar Loans pursuant to Sections
2.2 or 2.9 which, if in writing, shall be substantially in the form
of Exhibit B-1.


“Business Day”
means (i) with respect to any borrowing, payment or rate selection of
Eurodollar Loans, a day (other than a Saturday or Sunday) on which banks
generally are open in New York City for the conduct of substantially all of
their commercial lending activities, interbank wire transfers can be made on
the Fedwire system and dealings in Dollars are carried on in the London
interbank market and (ii) for all other purposes, a day (other than a Saturday
or Sunday) on which banks generally are open in New York City for the conduct
of substantially all of the commercial lending activities, and interbank wire
transfers can be made on the Fedwire system.


“Capital Lease
Obligations” means, with respect to any Person, the obligations of such
Person to pay rent or other amounts under any lease of (or other 



 4
 









arrangement
conveying the right to use) real or personal property, or a combination thereof,
which obligations are required to be classified and accounted for as capital
leases on a balance sheet of such Person under GAAP; and, for the purposes of
this Agreement, the amount of such obligations at any time shall be the
capitalized amount thereof at such time determined in accordance with GAAP.


“Capital and
Surplus” means, as of any date, (a) as to any Insurance Subsidiary
domiciled in the United States, the total surplus as regards policyholders (or
any successor line item description that contains the same information) as
shown in its Annual Statement or Quarterly Statement, or an amount determined
in a consistent manner for any date other than one as of which an Annual
Statement or Quarterly Statement is prepared and (b) as to any other Insurance
Subsidiary, the equivalent amount (determined in good faith by Parent).


“Capital Stock”
means any and all shares, interests, participations or other equivalents
(however designated) of capital stock or share capital of a corporation, any
and all equivalent ownership interests in a Person (other than a corporation)
and any and all warrants, rights or options to purchase any of the foregoing.


“Cash
Collateralize” means to pledge and deposit with or deliver to the
Administrative Agent, for the benefit of the Issuing Lender and the Lenders, as
collateral for the L/C Obligations, cash or deposit account balances pursuant
to documentation in form and substance reasonably satisfactory to the
Administrative Agent and the Issuing Lender (which documents are hereby
consented to by the Lenders). 
Derivatives of such term have corresponding meanings.


(a)           “Change of Control”
means (a) the acquisition of ownership, directly or indirectly, beneficially or
of record, by any Person or group (within the meaning of the Act of 1934 and
the rules of the SEC thereunder as in effect on the date hereof), other than
(i) White Mountains, (ii) Berkshire Hathaway, (iii) Franklin Mutual or (iv)
John J. Byrne or any Related Person with respect to John J. Byrne (together
with, in the case of clauses (i), (ii), (iii) and (iv),
their Affiliates) of Capital Stock representing more than 30% of the aggregate
ordinary voting power represented by the issued and outstanding Capital Stock
of Parent (or, if White Mountains and its Subsidiaries own 30% or more of the
aggregate ordinary voting power represented by the issued and outstanding
Capital Stock of Parent, a percentage greater than such percentage of
ownership), (b) the occupation, within a period of two years commencing
after the IPO, of a majority of the seats (other than vacant seats) on the
board of directors of Parent by Persons who were neither (i) nominated by
the board of directors of Parent nor (ii) appointed by directors so
nominated or (c) neither the Borrower nor, if applicable, its successors shall
be a Subsidiary of Parent.  For the
avoidance of doubt, none of the Capital Stock held by the entities listed in clauses
(a)(i), (a)(ii), (a)(iii) and (a)(iv), nor the Capital
Stock held by any of their Affiliates, shall be included as being owned by a
Person or group when determining whether such Person or group has met the 30% threshold
set forth in clause (a).



 5
 









“Closing
Certificate” means a certificate substantially in the form of Exhibit E.


“Closing Date”
means the first date on which all the conditions precedent in Section 4.1
are satisfied or waived in accordance with Section 10.1.


“Code”
means the Internal Revenue Code of 1986, as amended from time to time.


“Commitments”
means, collectively the Revolving Credit Commitments, the Swing Line
Commitment, the L/C Commitment or as the context may require, any such
Commitment.


“Commonly
Controlled Entity” means an entity, whether or not incorporated, that is
under common control with the Loan Parties within the meaning of Section 4001
(a) (14) of ERISA or that is treated as a single employer with the Loan Parties
under Section 414 of the Code.


“Compensation
Period” has the meaning specified in Section 2.14(e)(ii).


“Compliance
Certificate” means a certificate duly executed by a Responsible Officer on
behalf of Parent substantially in the form of Exhibit A.


“Conditional
Common Equity” means convertible preferred stock which will convert to
common equity upon shareholder approval (provided that such shareholder
approval is obtained within the period required by the terms thereof).


“Consolidated
Net Income” means, for any period, the consolidated net income (or loss) of
Parent and its consolidated Subsidiaries for such period, determined on a
consolidated basis in accordance with GAAP; provided, that in
calculating Consolidated Net Income for any period, there shall be excluded for
purposes of the calculation of Consolidated Net Income (a) the income (or
deficit) of any Person accrued prior to the date it becomes a Subsidiary of
Parent or is merged into or consolidated with Parent or any of its Subsidiaries
and (b) any effects
resulting from SFAS158.


“Consolidated
Net Worth” means, as at any date, the sum of all amounts that would, in
conformity with GAAP be included on a consolidated balance sheet of Parent and
its consolidated Subsidiaries under stockholders’ equity at such date, plus
minority interests in Subsidiaries, as determined in accordance with GAAP; provided,
however, that any effects resulting from (a) SFAS 115 or (b) SFAS 158 shall be excluded for purposes of the
calculation of Consolidated Net Worth.


“Cure Period”
has the meaning specified in Section 7.1(b).


“Contractual
Obligation” means, as to any Person, any provision of any security issued
by such Person or of any agreement, instrument or other undertaking to which
such Person is a party or by which it or any of its Property is bound.



 6
 









“Debt”
means indebtedness for borrowed money.


“Debtor Relief
Laws” the Bankruptcy Code of the United States, and all other liquidation,
conservatorship, bankruptcy, assignment for the benefit of creditors,
moratorium, rearrangement, receivership, insolvency, reorganization, or similar
debtor relief laws of the United States or other applicable jurisdictions,
domestic or foreign, from time to time in effect and affecting the rights of
creditors generally.


“Default”
means any of the events specified in Section 8.1, whether or not
any requirement for the giving of notice, the lapse of time, or both, has been
satisfied.


“Defaulting
Lender” means any Lender that (a) has failed to fund any portion of the
Loans or participations in the L/C Obligations required to be funded by it
hereunder within one Business Day of the date required to be funded by it
hereunder unless such failure has been cured, (b) has otherwise failed to pay
over to the Administrative Agent or any other Lender any other amount required
to be paid by it hereunder within one Business Day of the date when due, unless
the subject of a good faith dispute or unless such failure has been cured or (c)
has been deemed insolvent or become the subject of a bankruptcy or insolvency
proceeding.


“Default Rate”
has the meaning specified in Section 2.11(c).


“Department”
means, with respect to any Insurance Subsidiary, the insurance commissioner or
other Governmental Authority of such Insurance Subsidiary’s jurisdiction of
domicile with which such Insurance Subsidiary is required to file its Annual
Statement.


“Dollars”
and “$” means lawful currency of the United States of America.


“Eligible
Assignee” means any Person that meets the requirements to be an assignee
under Section 10.7(b)(iii), (v), (vi), (vii) and (viii)
(subject to such consents, if any, as may be required under Section
10.7(b)(iii)).


“Environmental
Liability” means any liability, contingent or otherwise (including any
liability for damages, costs of environmental remediation, injunctive or
equitable relief, fines, penalties or indemnities), of a Loan Party or any of
its Subsidiaries resulting from or based upon (a) a violation of any
environmental law, (b) the generation, use, handling, transportation, storage,
treatment or disposal of any Hazardous Materials, (c) human exposure to any
Hazardous Materials, (d) the release or threatened release of any Hazardous
Materials into the environment or (e) any contract, agreement or other
consensual arrangement pursuant to which liability is assumed or imposed with
respect to any of the foregoing.


“ERISA”
means the Employee Retirement Income Security Act of 1974, as amended from time
to time.


“Eurodollar
Loans” means Loans for which the applicable rate of interest is based upon
the Eurodollar Rate.



 7
 









“Eurodollar
Rate” means, for any Interest Period with respect to a Eurodollar Loan, the
rate per annum equal to the British Bankers Association LIBOR Rate (“BBA
LIBOR”), as published by Reuters (or other commercially available source
providing quotations of BBA LIBOR as designated by the Administrative Agent
from time to time) at approximately 11:00 A.M., London time, two Business Days
prior to the commencement of such Interest Period, for Dollar deposits (for
delivery on the first day of such Interest Period) with a term equivalent to
such Interest Period.  If such rate is
not available at such time for any reason, then the “Eurodollar Rate” for such
Interest Period shall be the rate per annum determined by the Administrative
Agent to be the rate at which deposits in Dollars for delivery on the first day
of such Interest Period in same day funds in the approximate amount of the
Eurodollar Loan being made, continued or converted by Bank of America, N.A. and
with a term equivalent to such Interest Period would be offered by Bank of
America, N.A.’s London branch to major banks in the London interbank eurodollar
market at their request at approximately 11:00 A.M. (London time) two Business
Days prior to the commencement of such Interest Period.  “Excluded Taxes” has the meaning
specified in Section 2.16(a).


“Existing
Credit Agreement” means that certain Credit Agreement, dated as of August
26, 2004, among the Borrower, White Mountains, the several banks and other
financial institutions or entities from time to time parties thereto, JP Morgan
Chase Bank, as syndication agent, and Bank of America, N.A., as administrative
agent.


“Existing
Letters of Credit” means those letters of credit set forth on Schedule
1A.


“Event of
Default” means any of the events specified in Section 8.1, provided
that any requirement for the giving of notice, the lapse of time, or both, has
been satisfied.


“Facility Fee
Rate” means the applicable percentage per annum set forth below
corresponding to the most current non-credit enhanced senior unsecured debt
ratings issued by S&P and by Moody’s with respect to Fund American.




	
  Pricing Level

  	
   

  	
  Debt Rating

  	
   

  	
  Facility Fee Rate

  
	
  I

  	
   

  	
  ≥ A-/A3

  	
   

  	
  0.070%

  
	
  II

  	
   

  	
  BBB+/Baa1

  	
   

  	
  0.080%

  
	
  III

  	
   

  	
  BBB/Baa2

  	
   

  	
  0.100%

  
	
  IV

  	
   

  	
  BBB-/Baa3

  	
   

  	
  0.125%

  
	
  V

  	
   

  	
  < BBB-/Baa3

  	
   

  	
  0.175%

  






“Debt Rating” means, as of any date of
determination, the rating as determined by either S&P or Moody’s
(collectively, the “Debt Ratings”) of the Borrower’s non-credit 



 8
 









enhanced (other than through an unsecured guarantee of
Parent), senior unsecured debt; provided  that (a) if the
respective Debt Ratings issued by the foregoing rating agencies differ by one
level, then the pricing level of the higher Debt Rating shall apply (with the
Debt Rating of pricing level I being the highest and the Debt Rating for
pricing level V being the lowest), (b) in the event that there is a split in
Debt Rating of more than one level then the pricing level that is one level lower
than the pricing level of the higher Debt Rating shall apply, (c) if the
Borrower has only one Debt Rating, then the pricing level of that Debt Rating
shall apply, and (d) if the Borrower does not have any Debt Rating, the
Facility Fee Rate shall be that corresponding to pricing level V; provided  that, so long as the only rated senior unsecured debt of the
Borrower is credit enhanced through a guarantee provided by White Mountains, the
Facility Fee Rate shall be that corresponding to the pricing level that is one level below the pricing level
corresponding to such Debt Rating, if there is a lower level.  For the avoidance of doubt, if the only rated
senior unsecured debt of the
Borrower is guaranteed by White Mountains and has a Debt Rating of BBB/Baa2,
the applicable pricing level shall be pricing level IV.  Each change in the Facility Fee Rate
resulting from a publicly announced change in the Debt Rating shall be
effective during the period commencing on the date of the public announcement
thereof and ending on the date immediately preceding the effective date of the
next such change.


“Federal Funds
Rate” means, for any day, the rate per annum equal to the weighted average
of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Business Day next
succeeding such day; provided that (a) if such day is not a Business
Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Business Day as so published on the next
succeeding Business Day, and (b) if no such rate is so published on such next
succeeding Business Day, the Federal Funds Rate for such day shall be the average
rate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%) charged
to Bank of America, N.A. on such day on such transactions as reasonably
determined by the Administrative Agent.


“Fee Letters”
means, collectively, the Agent Fee Letter and the Arranger Fee Letter.


“Fitch”
means Fitch, Inc. (or any successor thereto).


“Franklin
Mutual” means any investment fund managed by Franklin Mutual Advisers LLC
(or any successor thereto) or any of its Affiliates.


“Fund”
means any Person (other than a natural person) that is (or will be) engaged in
making, purchasing, holding or otherwise investing in revolving credit
facilities and similar extensions of credit in the ordinary course of its
business.


“Fund American
Enterprises” means Fund American Enterprises Holdings, Inc., a Delaware
corporation.



 9
 









“Fund American
Notes” means those certain 5.875% Senior Notes issued pursuant to the
Senior Indenture, dated as of May 19, 2003, between the Borrower, White
Mountains and Bank One, National Association, as trustee, in the aggregate
principal amount of $700,000,000 due May 15, 2013.


“Fund American
Preferred Stock” means collectively, the Berkshire Preferred Stock and the
Zenith Preferred Stock.


“Fundamental
Change” means any of (a) Parent consolidating or amalgamating with or
merging into any other Person, (b) Parent failing to preserve, renew and keep,
in full force and effect, its corporate existence, (c) Parent, directly or
indirectly through one or more of its Subsidiaries, conveying or transferring
the properties and assets of Parent and its Subsidiaries (taken as a whole for
Parent and its Subsidiaries) substantially as an entirety (other than to Parent
or one or more of its Subsidiaries), or (d) Parent liquidating, winding up or
dissolving itself, other than, in the case of clauses (a) through (d),
any such transaction or transactions the sole purpose of which is to change the
domicile of Parent (in any such redomiciliation (x) the surviving, amalgamated or transferee entity shall expressly assume,
by an agreement reasonably satisfactory to the Administrative Agent, the
obligations of Parent to be performed or observed hereunder and deliver to the
Administrative Agent such corporate authority documents and legal opinions as
the Administrative Agent shall reasonably request, (y) the surviving, amalgamated or transferee entity shall succeed to, and be
substituted for, and may exercise every right and power of, Parent under this
Agreement with the same effect as if such surviving, amalgamated or transferee
entity had been named as Parent herein and (z) the surviving, amalgamated or transferee entity shall be organized under
the laws of the United States of America, any state thereof, the District of
Columbia or Bermuda).


“GAAP”
means generally accepted accounting principles in the United States of America
as in effect from time to time and set forth in the opinions and pronouncements
of the Accounting Principles Board and the American Institute of Certified
Public Accountants and statements and pronouncements of the Financial
Accounting Standards Board or such other principles as may be approved by a
significant segment of the accounting profession in the United States, except
that for purposes of Section 7.1, GAAP shall be determined on the basis
of such principles in effect on the date hereof.


“Governmental
Authority” means any nation or government, any state or other political
subdivision thereof whether state or local and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government, and any corporation or other entity owned or controlled, through
stock or capital ownership or otherwise, by any of the foregoing, including any
board of insurance, insurance department or insurance commissioner.


“Granting
Lender” has the meaning specified in Section 10.7(h).



 10















 


“Guarantee
Obligation” means as to any Person (the “guaranteeing person”), any
obligation of (a) the guaranteeing person or (b) another Person (including,
without limitation, any bank under any letter of credit) to induce the creation
of which the guaranteeing person has issued a reimbursement, counterindemnity
or similar obligation, in either case guaranteeing or in effect guaranteeing
any Indebtedness, leases, dividends or other obligations (the “primary
obligations”) of any other third Person (the “primary obligor”) in
any manner, whether directly or indirectly, including, without limitation, any
obligation of the guaranteeing person, whether or not contingent, (i) to
purchase any such primary obligation or any Property constituting direct or
indirect security therefor, (ii) to advance or supply funds (1) for the
purchase or payment of any such primary obligation or (2) to maintain working
capital or equity capital of the primary obligor or otherwise to maintain the
net worth or solvency of the primary obligor, (iii) to purchase Property,
securities or services primarily for the purpose of assuring the owner of any
such primary obligation of the ability of the primary obligor to make payment
of such primary obligation or (iv) otherwise to assure or hold harmless the
owner of any such primary obligation against loss in respect thereof; provided,
however, that the term Guarantee Obligation shall not include
endorsements of instruments for deposit or collection in the ordinary course of
business.  The amount of any Guarantee
Obligation of any guaranteeing person shall be deemed to be the lower of (a) an
amount equal to the stated or determinable amount of the primary obligation in
respect of which such Guarantee Obligation is made and (b) the maximum amount for
which such guaranteeing person may be liable pursuant to the terms of the
instrument embodying such Guarantee Obligation, unless such primary obligation
and the maximum amount for which such guaranteeing person may be liable are not
stated or determinable, in which case the amount of such Guarantee Obligation
shall be such guaranteeing person’s maximum reasonably anticipated liability in
respect thereof as determined by Parent in good faith.


“Guarantor”
has the meaning specified in Section 2.21 hereto.


“Hazardous
Materials” means all explosive or radioactive substances or wastes,
hazardous or toxic substances or wastes, pollutants, solid, liquid or gaseous
wastes, including petroleum or petroleum distillates, asbestos or asbestos
containing materials, polychlorinated biphenyls (“PCBs”) or
PCB-containing materials or equipment, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
environmental law.


“Hedge
Agreements” means all interest rate swaps, caps or collar agreements or
similar arrangements entered into by the Loan Parties or their Subsidiaries
providing for protection against fluctuations in interest rates or currency
exchange rates or otherwise providing for the exchange of nominal interest obligations,
either generally or under specific contingencies.


“Increase
Effective Date” has the meaning specified in Section 2.22(b).


“Indebtedness”
means, as to any Person at any date, without duplication, all of the following,
whether or not included as Indebtedness or liabilities in accordance with GAAP
(a) all Debt of such Person, (b) all obligations of such Person for the
deferred 



 11
 









 


purchase price of
Property or services (other than trade payables 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 indebtedness
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
Capital Lease Obligations of such Person, (f) all obligations of such Person,
contingent or otherwise, as an account party or applicant under acceptance,
letter of credit, bank guarantees, surety bonds or similar facilities, (g) all
obligations of such Person, contingent or otherwise, to purchase, redeem,
retire, defease or otherwise acquire for value any Capital Stock of such
Person, (h) all Guarantee Obligations of such Person in respect of any of the
foregoing, (i) all obligations of the kind referred to in clauses (a)
through (h) above secured by (or for which the holder of such obligation
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, whether or not such Person has assumed or become liable for the
payment of such obligation and (j) for the purposes of Section 8.1(i)
only, all obligations of such Person in respect of Hedge Agreements entered into in the ordinary course of business and
not for speculative purposes.  For
the avoidance of doubt, Indebtedness shall include Surplus Debentures and shall
in any event not include any obligations (including Guarantee Obligations) in
respect of the Fund American Preferred Stock, provided, that,
arrangements reasonably satisfactory to the Administrative Agent shall have
been made for the establishment of grantor trusts to provide for the payment or
redemption of the Fund American Preferred Stock, it being understood that such
arrangements in effect on the Closing Date are reasonably satisfactory to the
Administrative Agent.


“Indemnified
Liabilities” has the meaning specified in Section 10.6.


“Indemnitees”
has the meaning specified in Section 10.6.


“Insolvency”
means with respect to any Multiemployer Plan, the condition that such Plan is
insolvent within the meaning of Section 4245 of ERISA.


“Insolvent”
means pertaining to a condition of Insolvency.


“Insurance
Regulations” means any Law, directive or order applicable to an insurance
company.


“Insurance
Regulator” means any Person charged with the administration, oversight or
enforcement of any Insurance Regulation.


“Insurance
Subsidiary” means any Subsidiary which is required to be licensed by any
Department as an insurer or reinsurer and each direct or indirect Subsidiary of
such Subsidiary.


“Intellectual
Property” means the collective reference to all rights, priorities and
privileges relating to intellectual property, arising under Laws, including,
without limitation, copyrights, copyright licenses, patents, patent licenses,
trademarks, 



 12
 









 


trademark
licenses, technology, know-how and processes, and all rights to sue at law or
in equity for any infringement or other impairment thereof, including the right
to receive all proceeds and damages therefrom.


“Interest
Payment Date” means (a) as to any Base Rate Loan, the first Business Day of
each of January, April, July and October and the last day of the Revolving
Credit Commitment Period, (b) as to any Eurodollar Loan, the last day of each
Interest Period applicable to such Loan and the last day of the Revolving
Credit Commitment Period; provided, however, that if any Interest
Period for a Eurodollar Loan exceeds three months, the respective dates that
fall every three months after the beginning of such Interest Period shall also
be Interest Payment Dates, and (c) as to any Loan (other than a Base Rate
Loan), the date of any repayment or prepayment made in respect thereof.


“Interest
Period” means, as to any Eurodollar Loan, (a) initially, the period
commencing on the borrowing or conversion date, as the case may be, with
respect to such Eurodollar Loan and ending one, two, three or six months (or,
unless unavailable to  any Lender, nine
or twelve months) thereafter, as selected by the Borrower in its notice of
borrowing or notice of conversion, as the case may be, given with respect thereto;
and (b) thereafter, each period commencing on the last day of the next
preceding Interest Period applicable to such Eurodollar Loan and ending one,
two, three or six months (or, unless unavailable to any Lender, nine or twelve
months) thereafter, as selected by the Borrower by irrevocable notice to the
Administrative Agent not less than three Business Days prior to the last day of
the then current Interest Period with respect thereto; provided that,
all of the foregoing provisions relating to Interest Periods are subject to the
following:


(i) if any Interest Period would otherwise end on a
day that is not a Business Day, such Interest Period shall be extended to the
next succeeding Business Day unless the result of such extension would be to
carry such Interest Period into another calendar month in which event such
Interest Period shall end on the immediately preceding Business Day;


(ii) any Interest Period in respect of the Loans that
would otherwise extend beyond the Revolving Credit Termination Date shall end
on the Revolving Credit Termination Date, and


(iii) any Interest Period that begins on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall end on the last Business Day of the calendar month at the end of such
Interest Period.


“IPO” means
an initial public offering by Parent of its common stock pursuant to an
effective S-1 Registration Statement under the Securities Act of 1933, as amended.



 13
 









 


“ISP”
means, with respect to any Letter of Credit, the “International Standby
Practices 1998” published by the Institute of International Banking Law &
Practice (or such later version thereof as may be in effect at the time of
issuance).


“Issuer Documents”
means with respect to any Letter of Credit, the Application, and any other
document, agreement and instrument entered into by the Issuing Lender and the
Borrower (or any Subsidiary) or by the Borrower (or any Subsidiary) in favor of
the Issuing Lender and relating to any such Letter of Credit.


“Issuing Lender”
means Bank of America, N.A. and any other Lender from time to time designated
by the Borrower as an Issuing Lender, with the consent of such Lender and the
Administrative Agent.


“Laws”
means any law, treaty, rule, regulation or order of an arbitrator or a court or
other Governmental Authority.


“LBB” means
Lehman Brothers Bank, FSB.


“L/C Advance”
means, with respect to each Lender, such Lender’s funding of its participation
in any L/C Borrowing in accordance with its Revolving Credit Percentage.


“L/C Borrowing”
means an extension of credit resulting from a drawing under any Letter of
Credit which has not been reimbursed on the date when made or refinanced as a
borrowing.


“L/C Commitment”
means $20,000,000, as the same may be reduced from time to time pursuant to Section
2.7.


“L/C Credit
Extension” means, with respect to any Letter of Credit, the issuance
thereof or extension of the expiry date thereof or the increase of the amount
thereof.


“L/C Fee
Payment Date” means the first Business Day of each of January, April, July
and October and the last day of the Revolving Credit Commitment Period.


“L/C
Obligations” means, at any time, an amount equal to the sum of (a) the
aggregate amount available to be drawn under all outstanding Letters of Credit
and (b) the aggregate amount of drawings under Letters of Credit that have not
then been reimbursed pursuant to Section 3.3.  For purposes of computing the amount
available to be drawn under any Letter of Credit, the amount of such Letter of
Credit shall be determined in accordance with Section 1.3.  For all purposes of this Agreement, if on any
date of determination a Letter of Credit has expired by its terms but any
amount may still be drawn thereunder by reason of the operation of Rule 3.14 of
the ISP, such Letter of Credit shall be deemed to be “outstanding” in the
amount so remaining available to be drawn.



 14
 









“L/C
Participants” means, with respect to any Letter of Credit, the collective
reference to all of the Lenders, other than the Issuing Lender that issued such
Letter of Credit.


“Lenders”
has the meaning specified in the preamble hereto.


“Letters of
Credit” means any letters of credit issued hereunder and shall include the
Existing Letters of Credit.


“License”
means any license, certificate of authority, permit or other authorization
which is required to be obtained from any Governmental Authority in connection
with the operation, ownership or transaction of insurance or reinsurance
business.


“Lien” means
any mortgage, pledge, security interest, encumbrance, charge or security
interest of any kind.


“Loan”
means any loan made by any Lender to the Borrower pursuant to this Agreement,
including any Revolving Credit Loan and any Swing Line Loan made by the Swing
Line Lender.


“Loan Documents”
means this Agreement, the Applications, the Notes and any Instrument of
Accession executed hereunder pursuant to Section 2.22.


“Loan Parties”
has the meaning specified in the preamble hereto.


“Majority
Lenders” means the holders of more than 50% of the Total Revolving
Extensions of Credit (or, if no such Revolving Extensions of Credit are
outstanding, prior to any termination of the Revolving Credit Commitments, the
holders of more than 50% of the Total Revolving Credit Commitments).  The Revolving Credit Commitment in effect
(or, when applicable, Revolving Extensions of Credit outstanding) of any
Defaulting Lender shall be excluded for purposes of any vote of Majority
Lenders.


“Mandatory
Convertible Securities” means equity securities or subordinated debt
securities (which debt securities, if issued by a Loan Party, will include
subordination to the obligations of such Loan Party hereunder), issued by
Parent or one of its Subsidiaries which (i) are not (w) Mandatory Redeemable
Securities or (x) Conditional Common Equity and (ii) provide, pursuant to the
terms thereof, that the issuer of such securities (or an affiliate of such
issuer) may cause (without the payment of additional cash consideration by the
issuer thereof) the conversion of such securities to equity securities of
Parent or one of its Subsidiaries upon the occurrence of a certain date or of
certain events.


“Mandatory Redeemable Securities” means
debt or equity securities (other than Conditional Common Equity, so long as
such Conditional Common Equity may not be required, by the holder thereof, to
be repurchased or redeemed during the period provided for shareholder approval
of conversion pursuant to the terms of such Conditional Common Equity) issued
by Parent or one of its Subsidiaries which provide, 



 15
 









 


pursuant to the
terms thereof, that such securities must be repurchased or redeemed, or the
holder of such securities may require the issuer of such securities to
repurchase or redeem such securities, upon the occurrence of a certain date or
of certain events.


“Material
Adverse Effect” means a material adverse effect on (a) the business,
assets, property or financial condition of the Borrower and its Subsidiaries
taken as a whole, or (b) the validity or enforceability of this Agreement or
any of the other Loan Documents or the rights and remedies of the
Administrative Agent and the Lenders hereunder or thereunder.


“Material
Insurance Subsidiary” means any Insurance
Subsidiary (whether existing on or  acquired
or formed after the Closing Date)  having Capital and Surplus equal to 10% or
more of the Consolidated Net Worth of Parent as of the most recent Annual
Statement or Quarterly Statement of such Insurance Subsidiary.


“Maximum Rate” has the meaning specified in Section 10.20(a).


“Moody’s”
means Moody’s Investors Service, Inc. (or any successor thereto).


“Multiemployer
Plan” means a Plan that is a multiemployer plan as defined in Section
4001(a)(3) of ERISA.


“NAIC”
means the National Association of Insurance Commissioners or any successor
thereto, or in the absence of the National Association of Insurance
Commissioners or such successor, any other association, agency or other
organization performing advisory, coordination or other like functions among
insurance departments, insurance commissioners and similar Governmental
Authorities of the various states of the United States towards the promotion of
uniformity in the practices of such Governmental Authorities.


“Non-Excluded
Taxes” has the meaning specified in Section 2.16(a).


“Non-Regulated
Operating Subsidiary” means each Subsidiary of the Loan Parties engaged
directly (as opposed to indirectly through the ownership of Capital Stock of a
Person engaged in a Principal Business) in a Principal Business, whether now
owned or hereafter acquired, which is not an Insurance Subsidiary.


“Non-U.S.
Lender” has the meaning specified in Section 2.16(d).


“Note”
means any promissory note, including any revolving credit note or swing line
note, made by the Borrower in favor of a Lender evidencing any Loan,
substantially in the forms of Exhibit C-1 and C-2, as the case
may be and as any such Note may be amended, restated, supplemented, modified or
replaced from time to time.


“OneBeacon
Insurance Group” means OneBeacon Insurance Group, LLC, a Delaware limited
liability company, and, for purposes of Section 6.1(b), the grouping of 



 16
 









 


Subsidiaries of
OneBeacon Insurance Group identified by NAIC Group Code 1129 (or any successor
grouping equivalent thereto).


“Other Taxes”
means any and all present or future stamp or documentary taxes or any other
excise or property taxes, charges or similar levies arising from any payment
made hereunder or from the execution, delivery or enforcement of, or otherwise
with respect to, this Agreement or any other Loan Document.


“Parent”
has the meaning specified in the preamble hereto.


“Parent
Guaranty” has the meaning specified in Section 2.21(a).


“Participant”
has the meaning specified in Section 10.7(d).


“PBGC”
means the Pension Benefit Guaranty Corporation established pursuant to Subtitle
A of Title IV of ERISA (or any successor).


“Permitted Liens” means
(a) any Lien upon Property to secure any part of the cost of development,
construction, alteration, repair or improvement of such Property, or Debt
incurred to finance such cost; (b) any extension, renewal or replacement,
in whole or in part, of any Lien referred to in the foregoing clause (a);
(c) any Lien relating to a sale and leaseback transaction; (d) any
Lien in favor of a Loan Party or any Subsidiary granted by a Loan Party or any
Subsidiary in order to secure any intercompany obligations; (e) mechanic’s,
materialmen’s, carriers’ or other like Liens arising in the ordinary course of
business (including construction of facilities) in respect of obligations which
are not due or which are being contested in good faith: (f) any Lien
arising in connection with any legal proceeding which is being contested in
good faith; (g) Liens for taxes not yet subject to penalties for
non-payment or which are being contested in good faith by appropriate
proceedings; (h) minor survey exceptions, minor encumbrances, easements or
reservations of, or rights of others for, licenses, rights-of-way, sewers,
electric lines, telegraph and telephone lines and other similar purposes, or zoning
or other restrictions as to the use of real property or Liens incidental to the
conduct of the business of such Person or to the ownership of its properties
which were not incurred in connection with Debt and which do not in the
aggregate materially adversely affect the value of said properties or
materially impair their use in the operation of the business of such Person;
(i) pledges or deposits under workers’ compensation Laws, unemployment
insurance Laws or similar social security legislation; (j) any deposit to
secure performance of letters of credit, bank guarantees, bids, leases,
statutory obligations, surety and appeal bonds, performance bonds or other
obligations of a like nature in the ordinary course of business; (k) any
interest or title of a lessor under any lease entered into in the ordinary
course of business; (l) Liens on assets of any Insurance Subsidiary
securing (i) short-term Debt (i.e. with a maturity of less than one year when
issued, provided that such Debt may include an option to extend for up to an
additional one year period) incurred to provide short-term liquidity to
facilitate claims payments in the event of catastrophe, (ii) Debt incurred in
the ordinary course of its business or in 



 17
 









 


securing
insurance-related obligations (that do not constitute Debt) and letters of
credit issued for the account of any such Subsidiary in the ordinary course of
its business or in securing insurance-related obligations (that do not
constitute Debt) or (iii) insurance-related obligations (that do not constitute
Debt); and (m) Liens securing the obligations hereunder.


“Person”
means an individual, partnership, corporation, limited liability company,
business trust, joint stock company, trust, unincorporated association, joint
venture, Governmental Authority or other entity of whatever nature.


“Plan”
means at a particular time, any employee pension benefit plan that is subject
to the provisions of Title IV of ERISA or Section 412 of the Code or Section
302 of ERISA, and in respect of which either of the Loan Parties or a Commonly
Controlled Entity is (or, if such plan were terminated at such time, would
under Section 4069 of ERISA be deemed to be) an “employer” as defined in
Section 3(5) of ERISA.


“Platform”
has the meaning specified in Section 6.2(e).


“Principal
Business” means (a) a business of the type engaged in by the Loan Parties
and their Subsidiaries on the date of this Agreement, (b) any other insurance,
insurance services, insurance related or risk management related business and
(c) any business reasonably incident to any of the foregoing.


“Property”
means any property of any kind whatsoever, whether real, personal or mixed and
whether tangible or intangible.


“Qualified
Mandatory Redeemable Securities” means Mandatory Redeemable Securities
that, pursuant to the terms thereof, must be redeemed or repurchased, or may be
required to be redeemed or repurchased at the option of the holder of such
securities (other than upon the occurrence of one or more events or conditions
other than the occurrence of a certain date), not sooner than the Revolving
Credit Termination Date.


“Quarterly
Statement” means the quarterly statutory financial statement of any
Insurance Subsidiary required to be filed with the Department of its
jurisdiction of incorporation, which statement shall be in the form required by
such Insurance Subsidiary’s jurisdiction of incorporation or, if no specific
form is so required, in the form of financial statements permitted by such
Department to be used for filing quarterly statutory financial statements and
shall contain the type of information permitted or required by such Department
to be disclosed therein, together with all exhibits or schedules filed
therewith.


“Refunded Swing
Line Loans” has the meaning specified in Section 2.4(b).


“Refunding Date”
has the meaning specified in Section 2.4(c).


“Register”
has the meaning specified in Section 10.7(c).



 18
 









 


“Regulation U”
means Regulation U of the Board as in effect from time to time.


“Reimbursement
Obligation” means the obligation of the Borrower to reimburse an Issuing
Lender pursuant to Section 3.3(a) for amounts drawn under Letters of
Credit issued by such Issuing Lender for the account of the Borrower.


“Related Person”
means, with respect to any Person, such Person’s Affiliates and the partners,
directors, officers, employees, agents and advisors of such Person and of such
Person’s Affiliates.


“Reorganization”
means, with respect to any Multiemployer Plan, the condition that such plan is
in reorganization within the meaning of Section 4241 of ERISA.


“Reportable
Event” means any of the events set forth in Section 4043(c) of ERISA, other
than those events as to which the thirty day notice period is waived.


“Requested
Reimbursement Date” has the meaning specified in Section 3.3(a).


“Requirement of
Law” means, as to any Person, the Certificate of Incorporation and By-Laws
or other organizational or governing documents of such Person (excluding, in
the case of Section 2.15(a)(i), any of the foregoing relating to the
Administrative Agent or any Lender), and any Law, in each case applicable to or
binding upon such Person or any of its Property or to which such Person or any
of its Property is subject.


“Responsible
Officer” means, as to any Loan Party or Subsidiary, the chief executive
officer, president, chief financial officer, treasurer, chief accounting
officer, any vice president or any managing director of such Loan Party or any
Subsidiary, as the context requires.  Any
document delivered hereunder that is signed by a Responsible Officer on behalf
of a Loan Party or Subsidiary shall be conclusively presumed to have been
authorized by all necessary corporate, partnership and/or other action on the
part of such Loan Party or Subsidiary and such Responsible Officer shall be
conclusively presumed to have acted on behalf of such Loan Party or Subsidiary.


“Revolving
Credit Commitment” means, as to any Lender, the obligation of such Lender,
if any, to make Revolving Credit Loans and participate in Swing Line Loans and
Letters of Credit, in an aggregate principal or face amount not to exceed the
amount set forth under the heading “Revolving Credit Commitment” opposite such
Lender’s name on Schedule 1 to this Agreement, or, as the case may be,
in the Assignment and Assumption pursuant to which such Lender became a party
hereto, as the same may be adjusted from time to time pursuant to the terms
hereof.


“Revolving
Credit Commitment Period” means the period from and including the Closing
Date to the earliest of (a) the Revolving Credit Termination Date, (b) the date
of termination of the Revolving Credit Commitments pursuant to Section 2.7,




 19
 









 


and (c) the date
of termination of the commitment of each Lender to make Loans and of the
obligation of the Issuing Lender to make L/C Credit Extensions pursuant to Section
8.2.


“Revolving
Credit Loans” has the meaning specified in Section 2.1.


“Revolving
Credit Percentage” means, as to any Lender at any time, the percentage
(carried out to the ninth decimal place) which such Lender’s Revolving Credit
Commitment then constitutes of the Total Revolving Credit Commitments (or, at
any time after the commitment of each Lender to make Loans and the obligation
of the Issuing Lender to make L/C Credit Extensions shall have terminated
pursuant to Section 8.2 or if the Revolving Credit Commitments shall
have expired, then the percentage which the aggregate amount of such Lender’s
Revolving Extensions of Credit then outstanding constitutes of the amount of
the Total Revolving Extensions of Credit then outstanding).


“Revolving Credit
Termination Date” means November 14, 2011; provided, however,
that, if such date is not a Business Day, the Revolving Credit Termination Date
shall be the next succeeding Business Day.


“Revolving
Extensions of Credit” means, as to any Lender at any time, an amount equal
to the sum of (a) the aggregate principal amount of all Revolving Credit Loans
made by such Lender then outstanding, (b) the principal amount equal to such
Lender’s Revolving Credit Percentage of the L/C Obligations then outstanding
and (c) the principal amount equal to such Lender’s Revolving Credit Percentage
of the aggregate principal amount of Swing Line Loans then outstanding.


“S&P”
means Standard & Poor’s Rating Services (or any successor thereto).


“SAP” means
with respect to any Insurance Subsidiary, the statutory accounting practices
prescribed or permitted by the Department in the jurisdiction of such Insurance
Subsidiary for the preparation of annual statements and other financial reports
by insurance companies of the same type as such Insurance Subsidiary, which are
applicable to the circumstances as of the date of determination.


“SEC” means
the Securities and Exchange Commission (or successors thereto or an analogous
Governmental Authority).


“SFAS”
means the Statements of Financial Accounting Standards adopted by the Financial
Accounting Standards Board.


“Single
Employer Plan” means any Plan that is covered by Title IV of ERISA, but
which is not a Multiemployer Plan.


“SPC” has
the meaning specified in Section 10.7(h).


 



 20















 


“Specified
Event of Default” means an Event of Default pursuant to Sections 8.1(a),
8.1(b) (with respect to Section 7.1 only) or 8.1(c).


“Stated Rate” has the meaning specified in Section 10.20(a).


“Subsidiary”
of a Person means (a) any corporation more than 50% of the outstanding
securities having ordinary voting power of which shall at the time be owned or
controlled, directly or indirectly, by such Person or by one or more of its
Subsidiaries or by such Person and one or more of its Subsidiaries, or (b) any
partnership, limited liability company, association, joint venture or similar
business organization more than 50% of the ownership interests having ordinary
voting power of which shall at the time be so owned or controlled.  Unless otherwise expressly provided, all
references herein to a “Subsidiary” shall mean a Subsidiary of Parent.


“Surplus
Debentures” means as to any Insurance Subsidiary, debt securities of such
Insurance Subsidiary the proceeds of which are permitted to be included, in
whole or in part, as Capital and Surplus of such Insurance Subsidiary as
approved and permitted by the applicable Department.


“Swing Line
Commitment” means the obligation of the Swing Line Lender to make Swing
Line Loans pursuant to Section 2.3 in an aggregate principal amount at
any one time outstanding not to exceed $5,000,000.


“Swing Line
Lender” means Bank of America, N.A., in its capacity as provider of Swing
Line Loans, or any successor swing line lender hereunder.


“Swing Line
Loans” has the meaning specified in Section 2.3(a).


“Swing Line
Participation Amount” has the meaning specified in Section 2.4(c).


“Syndication
Agent” means Lehman Brothers Inc., and any other Lender as may be
designated from time to time by the Borrower as a syndication agent, with the
consent of such Lender and the Arrangers.


“Total
Consolidated Capitalization” means, as at any date, the sum, without
duplication, of (a) Consolidated Net Worth plus (b) Total Consolidated Debt
plus, (c) the amounts in respect of Trust Preferred Securities, Mandatory
Convertible Securities, Mandatory Redeemable Securities, Conditional Common
Equity and any other preferred stock that would, in conformity with GAAP, be
reflected on a consolidated balance sheet of Parent and its consolidated
Subsidiaries prepared as of such date and which are not already included in clause
(a) or (b) above.  Total
Consolidated Capitalization shall in any event not include (x) any obligations
(including Guarantee Obligations) in respect of the Fund American Preferred
Stock, provided  that, arrangements reasonably satisfactory to the
Administrative Agent shall have been made for the establishment of grantor
trusts to provide for the payment or redemption of the Fund American Preferred
Stock, it being understood that such arrangements in effect on 



 21
 









 


the Closing Date
are reasonably satisfactory to the Administrative Agent or (y) any effects resulting from SFAS 158.


“Total Consolidated Debt” means,
at any date, the sum, without duplication, of (a) all amounts that would, in
conformity with GAAP, be reflected and classified as debt on a consolidated
balance sheet of Parent and its consolidated Subsidiaries prepared as of such
date, (b) Indebtedness represented by (i) Trust Preferred Securities or
Qualified Mandatory Redeemable Securities (in each case, owned by Persons other
than Parent or any of its consolidated Subsidiaries) but only to the extent
that such securities (other than Mandatory Convertible Securities) exceed 15%
of Total Consolidated Capitalization or (ii) Mandatory Redeemable Securities
(owned by Persons other than Parent or any of its consolidated Subsidiaries)
other than Qualified Mandatory Redeemable Securities, and (c) Indebtedness
represented by Mandatory Convertible Securities (owned by Persons other than
Parent or any of its consolidated Subsidiaries) but only to the extent that
such Mandatory Convertible Securities plus Trust Preferred Securities and
Qualified Mandatory Redeemable Securities (in each case, owned by Persons other
than Parent or any of its consolidated Subsidiaries) exceed 25% of Total
Consolidated Capitalization; provided, that in the event that the notes
related to the Mandatory Convertible Securities remain outstanding following
the exercise of forward purchase contracts related to such Mandatory Convertible
Securities, then such outstanding notes will be included in Total Consolidated
Debt thereafter.  Total Consolidated Debt
shall, in any event, not include (1) Hedge Agreements entered into in the
ordinary course of business for non-speculative
purposes, (2) Indebtedness of the type described in Sections 7.2(b), (c),
(d), (f) and (g), (3) Conditional Common Equity, (4) any
obligations (including Guarantee Obligations) in respect of the Fund American
Preferred Stock, provided  that, arrangements reasonably
satisfactory to the Administrative Agent shall have been made for the
establishment of grantor trusts to provide for the payment or redemption of the
Fund American Preferred Stock, it being understood that such arrangements in
effect on the Closing Date are reasonably satisfactory to the Administrative
Agent, (5) any other amounts in respect of Trust
Preferred Securities, Mandatory Redeemable Securities or Mandatory Convertible
Securities, or (6) any
effects resulting from SFAS 158.


“Total
Consolidated Debt to Total Consolidated Capitalization Ratio” means, as at
the end of any fiscal quarter of Parent, the ratio of (a) Total Consolidated
Debt to (b) Total Consolidated Capitalization.


“Total
Revolving Credit Commitments” means, at any time, the aggregate amount of
the Revolving Credit Commitments then in effect.  The aggregate amount of the Total Revolving
Credit Commitments on the Closing Date is $75,000,000.


“Total
Revolving Extensions of Credit” means, at any time, the aggregate amount of
the Revolving Extensions of Credit of the Lenders outstanding at such time.


“Transferee”
means a Participant or an assignee of any Lender’s rights and obligations under
this Agreement pursuant to an Assignment and Assumption.



 22
 









 


“Trust
Preferred Securities” means preferred securities issued by a special
purpose entity, the proceeds of which are used to purchase subordinated debt
securities of Parent or one of its Subsidiaries having terms that substantially
mirror those of such preferred securities issued by the special purpose entity
such that the debt securities constitute credit support for obligations in
respect of such preferred securities and such preferred securities are
reflected on a consolidated balance sheet of Parent and its consolidated
Subsidiaries in accordance with GAAP.


“Type”
means, as to any Loan, its nature as a Base Rate Loan or a Eurodollar Loan.


“Unreimbursed
Amount” has the meaning specified in Section 3.3(a).


“White
Mountains” means White Mountains Insurance Group, Ltd., a company existing
under the laws of Bermuda.


“White
Mountains Administrative Agent” means Bank of America, N.A., in its
capacity as administrative agent under any of the White Mountains Loan
Documents, or any successor administrative agent appointed in accordance with
the terms contained in the White Mountains Credit Agreement.


“White
Mountains Arrangers” means Banc of America Securities LLC and Lehman
Brothers Inc., in their respective capacities as joint lead arrangers and joint
book runners under the White Mountains Credit Agreement.


“White
Mountains Credit Agreement” means that certain Credit Agreement, dated as
of the date hereof, among White Mountains, White Mountains Re, the White
Mountains Lenders, the White Mountains Administrative Agent, the White
Mountains Arrangers and the White Mountains Syndication Agent, as such
agreement may be amended, restated, extended, supplemented or otherwise
modified in writing from time to time.


“White
Mountains Lenders” means the financial institutions from time to time party
to the White Mountains Credit Agreement.


“White
Mountains Loan Documents” means the “Loan Documents” as defined in the
White Mountains Credit Agreement.


“White
Mountains Re” means White Mountains Re Group, Ltd., a company existing
under the laws of Bermuda.


“White
Mountains Syndication Agent” means Lehman Brothers Inc., and any other
White Mountains Lender as may be designated from time to time by White
Mountains and White Mountains Re as a syndication agent under the White
Mountains Credit Agreement, with the consent of such White Mountains Lender and
the White Mountains Arrangers.



 23
 









 


“Zenith
Preferred Stock” means the $20,000,000 aggregate liquidation preference
amount of non-voting preferred stock issued by Fund American Enterprises to
Zenith Insurance Company pursuant to the Certificate of Designation of Series A
Preferred Stock of TACK Holding Corp. (n/k/a Fund American Enterprises), as
amended, supplemented or otherwise modified from time to time.


1.2.  Other Definitional Provisions.  Unless otherwise specified therein, all terms
defined in this Agreement shall have the defined meanings when used in the
other Loan Documents or any certificate or other document made or delivered
pursuant hereto or thereto.


(a)           As used herein and in the other Loan
Documents, and any certificate or other document made or delivered pursuant
hereto or thereto, accounting terms relating to the Loan Parties or their
Subsidiaries not defined in Section 1.1 and accounting terms partly
defined in Section 1.1, to the extent not defined, shall have the respective
meanings given to them under GAAP or SAP, as the case may be.


(b)           References herein to particular
pages, columns, lines or sections of any Person’s Annual Statement shall be
deemed, where appropriate, to be references to the corresponding page, column,
line or section of such Person’s Quarterly Statement, or if no such
corresponding page, column, line or section exists or if any report form
changes, then to the corresponding item referenced thereby.


(c)           The words “hereof”, “herein” and “hereunder”
and words of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this Agreement, and
Section, Schedule and Exhibit references are to this Agreement unless otherwise
specified.


(d)           The meanings given to terms defined
herein shall be equally applicable to both the singular and plural forms of
such terms.


(e)           The word “or” is not exclusive and
the words “include”, “includes” or “including” shall be deemed to be followed
by the phrase “without limitation”.


(f)            References to “preferred stock”
includes Capital Stock designated as preferred stock, preference shares,
preferred shares or any similar term.


1.3.  Letter of Credit Amounts.  Unless otherwise specified herein, the amount
of a Letter of Credit at any time shall be deemed to be the stated amount of
such Letter of Credit in effect at such time; provided, however,
that with respect to any Letter of Credit that, by its terms or the terms of
any Issuer Document related thereto, provides for one or more automatic
increases in the stated amount thereof, other than with respect to the
calculation of L/C Fees, the amount of such Letter of Credit shall be deemed to
be the maximum stated amount of such Letter of Credit after giving effect to
all such increases, whether or not such maximum stated amount is in effect at
such time.


1.4.  Rounding.  Any financial ratios required to be
maintained by the Borrower pursuant to this Agreement shall be calculated by
dividing the appropriate component by the 



 24
 









 


other component,
carrying the result to one place more than the number of places by which such
ratio is expressed herein and rounding the result up or down to the nearest
number (with a rounding-up if there is no nearest number).


1.5.  Times
of Day.  Unless otherwise
specified, all references herein to times of day shall be references to Eastern
time (daylight or standard, as applicable).


2.             AMOUNT AND TERMS OF COMMITMENTS


2.1.  Revolving Credit Commitments.  (a) 
Subject to the terms and conditions hereof, the Lenders severally agree
to make revolving credit loans (“Revolving Credit Loans”) to the
Borrower from time to time on any Business Day during the Revolving Credit
Commitment Period in an aggregate principal amount at any one time outstanding
for each Lender which, when added to such Lender’s Revolving Credit Percentage
of the sum of (i) the L/C Obligations then outstanding and (ii) the aggregate
principal amount of the Swing Line Loans then outstanding, does not exceed the
amount of such Lender’s Revolving Credit Commitment.  During the Revolving Credit Commitment Period
the Borrower may use the Revolving Credit Commitments by borrowing, prepaying
the Revolving Credit Loans in whole or in part, and reborrowing, all in
accordance with the terms and conditions hereof.  The Revolving Credit Loans may from time to
time be Eurodollar Loans or Base Rate Loans, as determined by the Borrower and
notified to the Administrative Agent in accordance with Sections 2.2 and
2.9, provided that no Revolving Credit Loan shall be made as a
Eurodollar Loan after the day that is one month prior to the Revolving Credit
Termination Date.


(b)           The Borrower shall repay to the
Lenders all outstanding Revolving Credit Loans made to the Borrower on the
Revolving Credit Termination Date.


2.2.  Procedure for Revolving Credit Borrowing.  The Borrower may borrow under the Revolving
Credit Commitments on any Business Day during the Revolving Credit Commitment
Period, provided that the Borrower shall give the Administrative Agent a borrowing
request in the form of Exhibit B-1 hereto (hereinafter, a “Borrowing
Request”) (which  Borrowing Request
must be received by the Administrative Agent prior to 11:00 A.M., New York City
time, (a) three Business Days prior to the requested Borrowing Date, in the
case of Eurodollar Loans, or (b) on the requested Borrowing Date, in the case
of Base Rate Loans, provided that requests for Base Rate Loans not received
prior to 11:00 A.M., New York City time on the requested Borrowing Date shall
be deemed received on the following Business Day), and must specify (i) the
amount and Type of Revolving Credit Loans to be borrowed, (ii) the requested
Borrowing Date and (iii) in the case of Eurodollar Loans, the length of the
initial Interest Period therefor; provided, however, that if the Borrower wishes
to request Eurodollar Loans having an Interest Period of nine or twelve months
in duration as provided in the definition of “Interest Period,” the applicable
notice must be received by the Administrative Agent not later than 11:00 A.M.
New York City time, four Business Days prior to the requested date of such
borrowing, whereupon the Administrative Agent shall give prompt notice to the
Lenders of such request and determine whether the requested Interest Period is
unavailable to any of them.  Not later
than 10:00 A.M. New York City time, three Business Days before the requested
date of such borrowing, the Administrative Agent shall notify the Borrower
(which 



 25
 









 


notice may be by telephone) whether or not the requested Interest Period
is unavailable to any Lender.  If the
Borrower requests a borrowing of Eurodollar Loans in any Borrowing Request, but
fails to specify an Interest Period, it will be deemed to have specified an
Interest Period of one month. 
Each borrowing of Revolving Credit Loans under the Revolving Credit
Commitments shall be in an amount equal to (x) in the case of Base Rate Loans,
$500,000 or a whole multiple thereof (or, if the then aggregate Available
Revolving Credit Commitments are less than $500,000, such lesser amount) and
(y) in the case of Eurodollar Loans, $1,000,000 or a whole multiple of $500,000
in excess thereof; provided, that the Swing Line Lender may request, on
behalf of the Borrower, borrowings of Base Rate Loans under the Revolving Credit
Commitments in other amounts pursuant to Section 2.4.  Upon receipt of any such notice from the
Borrower, the Administrative Agent shall promptly notify each Lender
thereof.  Each Lender will make its
Revolving Credit Percentage of the amount of each borrowing of Revolving Credit
Loans available to the Administrative Agent for the account of the Borrower at
the Administrative Agent’s Office prior to 12:00 Noon, New York City time, on
the Borrowing Date requested by the Borrower in funds immediately available to
the Administrative Agent.  Such borrowing
will then be made available to the Borrower by the Administrative Agent in like
funds as received by the Administrative Agent.


2.3.  Swing Line Commitment.  (a) Subject to the terms and conditions
hereof, the Swing Line Lender agrees, in reliance on the agreements of the
other Lenders set forth in Section 2.4, that during the Revolving Credit
Commitment Period, it will make available to the Borrower in the form of swing
line loans (“Swing Line Loans”) a portion of the credit otherwise
available to the Borrower under the Revolving Credit Commitments; provided
that (i) the aggregate principal amount of Swing Line Loans outstanding at any
time shall not exceed the Swing Line Commitment then in effect (notwithstanding
that the Swing Line Loans outstanding at any time, when aggregated with the
Swing Line Lender’s other outstanding Revolving Credit Loans hereunder, may
exceed the Swing Line Commitment then in effect or such Swing Line Lender’s
Revolving Credit Commitment then in effect) and (ii) the Borrower shall not
request, and the Swing Line Lender shall not make, any Swing Line Loan if,
after giving effect to the making of such Swing Line Loan, the aggregate amount
of the Available Revolving Credit Commitments would be less than zero.  During the Revolving Credit Commitment
Period, the Borrower may use the Swing Line Commitment by borrowing, repaying
and reborrowing, all in accordance with the terms and conditions hereof.  Swing Line Loans shall be Base Rate Loans
only.


(b)           The Borrower shall repay all
outstanding Swing Line Loans on the Revolving Credit Termination Date.  Each payment in respect of Swing Line Loans
shall be made to the Swing Line Lender.


2.4.  Procedure for Swing Line Borrowing;
Refunding of Swing Line Loans. 
(a)  The Borrower may borrow under
the Swing Line Commitment on any Business Day during the Revolving Credit
Commitment Period, provided, the Borrower shall give the Swing Line
Lender irrevocable telephonic notice confirmed promptly in writing in the form
of Exhibit B-2 (which telephonic notice must be received by the Swing
Line Lender not later than 1:00 P.M., New York City time, on the proposed
Borrowing Date), specifying (i) the amount to be borrowed and (ii) the
requested Borrowing Date.  Each borrowing
under the Swing Line Commitment shall be in an amount equal to $250,000 or a
whole multiple of $50,000 in excess thereof. 
Not later than 3:00 P.M., New York City time, on the Borrowing Date
specified in the borrowing notice in 



 26
 









 


respect of any
Swing Line Loan, the Swing Line Lender shall make available to the
Administrative Agent at the Administrative Agent’s Office an amount in
immediately available funds equal to the amount of such Swing Line Loan.  The Administrative Agent shall make the
proceeds of such Swing Line Loan available to the Borrower on such Borrowing
Date in like funds as received by the Administrative Agent.


(b)           The Swing Line Lender, not less
frequently than once each week shall, and at any other time, from time to time,
as the Swing Line Lender elects in its sole and absolute discretion, may, on
behalf of the Borrower (which hereby irrevocably directs the Swing Line Lender
to act on its behalf), on one Business Day’s notice given by the Swing Line
Lender no later than 12:00 Noon, New York City time, request each Lender to
make, and each Lender hereby agrees to make, a Revolving Credit Loan, in an
amount equal to such Lender’s Revolving Credit Percentage of the aggregate
amount of the Swing Line Loans (the “Refunded Swing Line Loans”)
outstanding on the date of such notice, to repay the Swing Line Lender.  Each Lender shall make the amount of such
Revolving Credit Loan available to the Administrative Agent at the
Administrative Agent’s Office in immediately available funds, not later than
10:00 A.M., New York City time, one Business Day after the date of such
notice.  The proceeds of such Revolving
Credit Loans shall be made immediately available by the Administrative Agent to
the Swing Line Lender for application by the Swing Line Lender to the repayment
of the Refunded Swing Line Loans.  Upon
the written request of any Lender, the Administrative Agent will, within three
Business Days of such request, inform such Lender of the aggregate amount of
Swing Line Loans outstanding on the date of such request.


(c)           If prior to the time a Revolving
Credit Loan would have otherwise been made pursuant to Section 2.4(b),
one of the events described in Section 8.1(c) shall have occurred and be
continuing with respect to either Loan Party, or if for any other reason, as
determined by the Swing Line Lender in its sole discretion, Revolving Credit
Loans may not be made as contemplated by Section 2.4(b), each Lender
shall, on the date such Revolving Credit Loan was to have been made pursuant to
the notice referred to in Section 2.4(b) (the “Refunding Date”),
purchase for cash an undivided participating interest in the then outstanding
Swing Line Loans by paying to the Swing Line Lender an amount (the “Swing
Line Participation Amount”) equal to (i) such Lender’s Revolving Credit
Percentage times (ii) the sum of the aggregate principal amount of Swing
Line Loans then outstanding which were to have been repaid with such Revolving
Credit Loans.


(d)           If any Lender fails to make available
to the Administrative Agent for the account of the Swing Line Lender any amount
required to be paid by such Lender pursuant to the foregoing provisions of this
Section 2.4(b) by the time specified in Section 2.4(b), the Swing
Line Lender shall be entitled to recover from such Lender (acting through the
Administrative Agent), on demand, such amount with interest thereon for the
period from the date such payment is required to the date on which such payment
is immediately available to the Swing Line Lender at a rate per annum equal to
the greater of the Federal Funds Rate and a rate determined by the Swing Line
Lender in accordance with banking industry rules on interbank 



 27
 









 


compensation, plus any administrative, processing or
similar fees customarily charged by the Swing Line Lender in connection with
the foregoing.  If such Lender pays such
amount (with interest and fees as aforesaid), the amount so paid shall
constitute such Lender’s Loan included in the relevant borrowing or funded
participation in the relevant Swing Line Loan, as the case may be.  A certificate of the Swing Line Lender
submitted to any Lender (through the Administrative Agent) with respect to any
amounts owing under this paragraph (d) shall be conclusive absent
manifest error.


(e)           Each Lender’s obligation to make the
Loans referred to in Section 2.4(b) and to purchase participating
interests pursuant to Section 2.4(c) shall be absolute and unconditional
and shall not be affected by any circumstance, including, without limitation,
(i) any setoff, counterclaim, recoupment, defense or other right which such
Lender may have against the Swing Line Lender, any Loan Party or any other
Person for any reason whatsoever; (ii) the occurrence or continuance of a
Default or an Event of Default or the failure to satisfy any of the other
conditions specified in Section 4; (iii) any adverse change in the
condition (financial or otherwise) of any Loan Party; (iv) any breach of this
Agreement or any other Loan Document by any Loan Party or any Lender; or (v)
any other circumstance, happening or event whatsoever, whether or not similar
to any of the foregoing.  No such funding
of risk participations shall relieve or otherwise impair the obligation of the
Borrower to repay Swing Line Loans, together with interest as provided herein.


(f)            Whenever, at any time after the
Swing Line Lender has received from any Lender such Lender’s Swing Line
Participation Amount, the Swing Line Lender receives any payment on account of
the Swing Line Loans, the Swing Line Lender will distribute to such Lender its
Swing Line Participation Amount (appropriately adjusted, in the case of
interest payments, to reflect the period of time during which such Lender’s
participating interest was outstanding and funded and, in the case of principal
and interest payments, to reflect such Lender’s pro  rata portion
of such payment if such payment is not sufficient to pay the principal of and
interest on all Swing Line Loans then due); provided, however,
that in the event that such payment received by the Swing Line Lender is
required to be returned, such Lender will return to the Swing Line Lender any
portion thereof previously distributed to it by the Swing Line Lender.  The obligation of the Lenders under this paragraph
(f) shall survive the payment in full of the Obligations and the
termination of this Agreement.


(g)           The Swing Line Lender shall be
responsible for invoicing the Borrower for interest on the Swing Line
Loans.  Until each Lender funds its
Refunded Swing Line Loan or risk participation pursuant to this Section 2.4
to refinance such Lender’s Revolving Credit Percentage of any Swing Line Loan,
interest in respect of such Revolving Credit Percentage shall be solely for the
account of the Swing Line Lender.



 28
 









 


(h)           The Borrower shall make all payments
of principal and interest in respect of the Swing Line Loans directly to the
Administrative Agent for the account of the Swing Line Lender.


2.5.  Repayment of Loans; Evidence of Debt.  (a) 
The Borrower hereby unconditionally promises to pay to the
Administrative Agent for the account of the appropriate Lender (i) the then
unpaid principal amount on the Revolving Credit Termination Date (or on such
earlier date on which the Loans become due and payable pursuant to Section
8.2) of each Revolving Credit Loan of such Lender made to the Borrower and
(ii) the then unpaid principal amount on the Revolving Credit Termination Date
(or on such earlier date on which the Loans become due and payable pursuant to Section
8.2) of each Swing Line Loan of such Swing Line Lender made to the
Borrower.  The Borrower hereby further
agrees to pay interest to the Administrative Agent for the account of the
appropriate Lender on the unpaid principal amount of the Loans made to it from
time to time outstanding from the date hereof until payment in full thereof at
the rates per annum, and on the dates, set forth in Section 2.11.


(b)           Each Lender shall maintain in
accordance with its usual practice an account or accounts evidencing
indebtedness of the Borrower to such Lender resulting from each Loan of such
Lender from time to time, including the amounts of principal and interest
payable and paid to such Lender from time to time under this Agreement.


(c)           The Administrative Agent, on behalf
of the Borrower, shall maintain the Register pursuant to Section 10.7(c),
and a subaccount therein for each Lender, in which shall be recorded (i) the
amount of each Loan to the Borrower made hereunder and any Note evidencing such
Loan, the Type of such Loan and each Interest Period applicable thereto, (ii)
the amount of any principal or interest due and payable or to become due and
payable from the Borrower to each Lender hereunder and (iii) both the amount of
any sum received by the Administrative Agent hereunder from or for the account
of the Borrower and each Lender’s share thereof.  In the event of any conflict between the
accounts and records maintained by any Lender and the accounts and records of
the Administrative Agent in respect of such matters, the accounts and records of
the Administrative Agent shall control in the absence of manifest error.


(d)           The entries made in the Register and
the accounts of each Lender maintained pursuant to Section 2.5(b) shall,
to the extent permitted by applicable Law, be prima  facie
evidence of the existence and amounts of the obligations of the Borrower
therein recorded; provided, however, that the failure of any
Lender or the Administrative Agent to maintain the Register or any such
account, or any error therein, shall not in any manner affect the obligation of
the Borrower to repay (with applicable interest) the Loans made to it by such
Lender in accordance with the terms of this Agreement.


(e)           The Borrower agrees that, upon the
request to the Administrative Agent by any Lender, it will execute and deliver
to such Lender a promissory note of the Borrower evidencing any Revolving
Credit Loans or Swing 



 29
 









 


Line Loans, as the case may be, made by such Lender to
the Borrower, substantially in the forms of Exhibit C-1 or C-2,
respectively, with appropriate insertions as to date and principal amount.  Each Lender may attach schedules to its Note
and endorse thereon the date, Type (if applicable), amount and maturity of its
Loans and payments with respect thereto.


(f)            In addition to the accounts and
records referred to herein above, each Lender and the Administrative Agent
shall maintain in accordance with its usual practice accounts or records
evidencing the purchases and sales by such Lender of participations in Letters
of Credit and Swing Line Loans.  In the
event of any conflict between the accounts and records maintained by the
Administrative Agent and the accounts and records of any Lender in respect of
such matters, the accounts and records of the Administrative Agent shall
control in the absence of manifest error.


2.6.  Facility Fee, etc.  (a) 
Parent agrees to pay to the Administrative Agent for the account of each
Lender in accordance with its Revolving Credit Percentage a facility fee for
the period from and including the Closing Date to the last day of the Revolving
Credit Commitment Period, computed at the Facility Fee Rate on the average
daily amount of the Revolving Credit Commitment of such Lender during the
period for which payment is made.  The
facility fee shall accrue at all times during the Revolving Credit Commitment
Period, including at any time during which one or more of the conditions in Section
4.2 is not met, and shall be payable quarterly in arrears on the first
Business Day of each of January, April, July and October and on the last day of
the Revolving Credit Commitment Period, commencing on the first of such dates
to occur after the Closing Date.  The
facility fee shall be calculated quarterly in arrears, and if there is any
change in the Facility Fee Rate during any quarter, the actual daily amount
shall be computed and multiplied by the Facility Fee Rate separately for each
period during such quarter that the Facility Fee Rate was in effect.


(b)           The Borrower agrees to pay to the
Arrangers for their own respective accounts the fees in the amounts and on the
dates from time to time agreed to in the Arranger Fee Letter.


(c)           The Borrower agrees to pay to the
Administrative Agent the fees in the amounts and on the dates from time to time
agreed to in the Agent Fee Letter.


2.7.  Termination or Reduction of Revolving
Credit Commitments.  The Borrower
shall have the right, upon notice to the Administrative Agent, to terminate the
Revolving Credit Commitments or, from time to time, to reduce the aggregate
amount of the Revolving Credit Commitments; provided that (a) no such
termination or reduction of Revolving Credit Commitments shall be permitted if,
after giving effect thereto and to any prepayments of the Revolving Credit
Loans and Swing Line Loans made on the effective date thereof, the Total
Revolving Extensions of Credit would exceed the Total Revolving Credit
Commitments, (b) any such reduction shall be in an amount equal to $1,000,000,
or a whole multiple thereof (or the remaining amount of the Revolving Credit
Commitments), (c) any such notice shall be received by the Administrative Agent
not later than 11:00 A.M. New York City time, three Business Days 



 30
 









 


prior to the date
of termination or reduction and (d) if, after giving effect to any reduction of
the Revolving Credit Commitments, the L/C Commitment or the Swing Line
Commitment exceeds the amount of the Revolving Credit Commitment, such
Commitment shall be automatically reduced by the amount of such excess; provided,
further, that a notice of termination of the Revolving Credit
Commitments delivered by the Borrower may state that such notice is conditioned
upon the effectiveness of other credit facilities, transactions or borrowings
in general, in which case such notice may be revoked the Borrower (by notice to
the Administrative Agent on or prior to the specified effective date) if such
condition is not satisfied.  The
Administrative Agent will promptly notify the Lenders of any notice of
termination or reduction of the Revolving Credit Commitments.  Any reduction of the Revolving Credit
Commitments shall be applied to the Revolving Credit Commitment of each Lender
according to its Revolving Credit Percentage. 
All fees accrued until the effective date of any termination of the
Revolving Credit Commitment shall be paid on the effective date of such
termination.  Any reduction shall reduce
permanently the Revolving Credit Commitments then in effect.


2.8.  Prepayments.  (a) 
The Borrower may at any time and from time to time prepay the Loans made
to the Borrower, in whole or in part, without premium or penalty, upon notice
delivered to the Administrative Agent at least three Business Days prior
thereto in the case of Eurodollar Loans and on the date of prepayment in the
case of Base Rate Loans, which notice shall specify the date and amount of
prepayment and whether the prepayment is of Eurodollar Loans or Base Rate
Loans; provided, that  (i) if a
Eurodollar Loan is prepaid on any day other than the last day of the Interest
Period applicable thereto, the Borrower shall also pay any amounts owing
pursuant to Section 2.17 and (ii) no prior notice is required for the
prepayment of Swing Line Loans; provided, further, that, if a
notice of prepayment is given in connection with a conditional notice of
termination of the Revolving Credit Commitments as contemplated by Section 2.7,
then such notice of prepayment may be revoked if such notice of termination is
revoked in accordance with Section 2.7.  Upon receipt of any such notice the
Administrative Agent shall promptly notify the Lenders thereof.  If any such notice is given, the amount
specified in such notice shall be due and payable on the date specified
therein, together with (except in the case of Base Rate Loans) accrued interest
to such date on the amount prepaid. 
Partial prepayments of Revolving Credit Loans shall be in an aggregate
principal amount of $500,000  or a
whole multiple thereof.  Partial
prepayments of Swing Line Loans shall be in an aggregate principal amount of
$50,000 or a whole multiple thereof.


(b)           If for any reason the Total Revolving
Extensions of Credit at any time exceed the Total Revolving Credit Commitments
then in effect, the Borrower shall immediately prepay the Loans and/or Cash
Collateralize the L/C Obligations in an aggregate amount equal to such excess; provided,
however, that the Borrower shall not be required to Cash Collateralize
the L/C Obligations pursuant to this Section 2.8(b) unless after the
prepayment in full of the Loans the Total Revolving Extensions of Credit exceed
the Total Revolving Credit Commitments then in effect.


2.9.  Conversion and Continuation Options.  (a) 
The Borrower may elect from time to time to convert Eurodollar Loans
made to the Borrower to Base Rate Loans by giving the Administrative Agent at
least two Business Days’ prior irrevocable notice (which may be telephonic) of
such election.  The Borrower may elect
from time to time to convert Base Rate 



 31
 









 


Loans made to the
Borrower to Eurodollar Loans by giving the Administrative Agent at least three
Business Days’ prior irrevocable notice (which may be telephonic) of such
election (which notice shall specify the length of the initial Interest Period
therefor); provided, however, that if the Borrower wishes
to request Eurodollar Loans having an Interest Period of nine or twelve months
in duration as provided in the definition of “Interest Period”, the applicable
notice must be received by the Administrative Agent not later than 11:00 A.M.
New York City time, four Business Days prior to the requested date of such
conversion or continuation, whereupon the Administrative Agent shall give
prompt notice to the Lenders of such request and determine whether the
requested Interest Period is unavailable to any of them.  Not later than 10:00 A.M. New York City time,
three Business Days before the requested date of such conversion or
continuation, the Administrative Agent shall notify the Borrower (which notice
may be by telephone) whether or not the requested Interest Period is
unavailable to any of the Lenders, provided, further that
no Base Rate Loan may be converted to a Eurodollar Loan (i) when any Event of
Default has occurred and is continuing and the Administrative Agent or the
Majority Lenders have determined in its or their sole discretion not to permit
such conversions or (ii) after the date that is one month prior to the
Revolving Credit Termination Date.  Each
telephonic notice by the Borrower pursuant to this Section 2.9 must be
confirmed promptly by delivery to the Administrative Agent of a written
Borrowing Request appropriately completed and signed by a Responsible Officer
of the Borrower.  If the Borrower
requests a conversion to a Eurodollar Loan in any Borrowing Request, but fails
to specify an Interest Period, it will be deemed to have specified an Interest
Period of one month.  Upon receipt of any
such notice the Administrative Agent shall promptly notify the Lenders thereof.


(b)           The Borrower may elect to continue
any Eurodollar Loan made to the Borrower as such upon the expiration of the
then current Interest Period with respect thereto by giving irrevocable notice
(which may be telephonic) to the Administrative Agent, in accordance with the
applicable provisions of the term “Interest Period” set forth in Section 1.1,
of the length of the next Interest Period to be applicable to such Loans, provided
that no Eurodollar Loan may be continued as such (i) when any Event of Default
has occurred and is continuing and the Administrative Agent or the Majority
Lenders have, determined in its or their sole discretion not to permit such
continuations or (ii) after the date that is one month prior to the Revolving
Credit Termination Date, and provided, further, that if the
Borrower shall fail to give any required notice as described above in this
paragraph or if such continuation is not permitted pursuant to the preceding proviso,
such Loans shall be converted automatically to Base Rate Loans on the last day
of such then expiring Interest Period. 
Each telephonic notice by the Borrower pursuant to this Section 2.9
must be confirmed promptly by delivery to the Administrative Agent of a written
Borrowing Request appropriately completed and signed by a Responsible Officer
of the Borrower.  Upon receipt of any
such notice the Administrative Agent shall promptly notify the Lenders thereof.


2.10.  Maximum Number of Eurodollar Loans.  Notwithstanding anything to the contrary in
this Agreement, all borrowings, conversions, continuations and optional
prepayments of Eurodollar Loans and all selections of Interest Periods shall be
in such amounts and be made pursuant to such elections so that no more than ten
Eurodollar Loans shall be outstanding at any one time.


 



 32















 


2.11.  Interest Rates and Payment Dates.  (a) 
Subject to the provisions of paragraph (c) below, each Eurodollar
Loan shall bear interest on the outstanding principal amount thereof for each
day during each Interest Period with respect thereto at a rate per annum equal
to the Eurodollar Rate determined for such day plus the Applicable Margin.


(b)           Each Base Rate Loan, including Swing
Line Loans, shall bear interest on the outstanding principal amount thereof
from the applicable borrowing date at a rate per annum equal to the Base Rate.


(c)           (i) If all or a portion of the
principal amount of any Loan or Reimbursement Obligation shall not be paid when
due (whether at the stated maturity, by acceleration or otherwise), such
overdue amount shall bear interest at a rate per annum that is equal to (x) in
the case of the Loans, the rate that would otherwise be applicable thereto
pursuant to the foregoing provisions of this Section 2.11  plus 2%
or (y) in the case of Reimbursement Obligations, the rate applicable to Base
Rate Loans plus 2%, and (ii) if all or a portion of any interest payable
on any Loan or Reimbursement Obligation or any facility fee or other amount
payable hereunder shall not be paid when due (whether at the stated maturity,
by acceleration or otherwise), such overdue amount shall bear interest at a
rate per annum equal to the rate then applicable to Base Rate Loans plus
2%, in each case, with respect to clauses (i) and (ii) above,
from the date of such non-payment until such amount is paid in full (each
of the foregoing collectively, the “Default Rate”).


(d)           Interest shall be payable in arrears
on each Interest Payment Date, provided that interest accruing pursuant
to paragraph (c) of this Section 2.11 shall be payable from time
to time on demand (after as well as before judgment and before and after the
commencement of any proceeding under any Debtor Relief Law).


2.12.  Computation of Interest and Fees.  (a) 
Interest, fees and commissions payable pursuant hereto shall be
calculated on the basis of a 365-day (or 366-day, as the case may be) year for
the actual days elapsed, except that, with respect to Eurodollar Loans, the
interest thereon shall be calculated on the basis of a 360-day year for the
actual days elapsed.  The Administrative
Agent shall as soon as practicable notify the Borrower and the Lenders of each
determination of a Eurodollar Rate.  Any
change in the interest rate on a Loan resulting from a change in the Base Rate
shall become effective as of the opening of business on the day on which such
change becomes effective.  The
Administrative Agent shall as soon as practicable notify the Borrower and the
Lenders of the effective date and the amount of each such change in any
interest rate.  Interest shall accrue on
each Loan for the day on which the Loan is made, and shall not accrue on a
Loan, or any portion thereof, for the day on which the Loan or such portion is
paid, provided that any Loan that is repaid on the same day on which it
is made shall, subject to Section 2.14(d), bear interest for one day.


(b)           Each determination of an interest
rate by the Administrative Agent pursuant to any provision of this Agreement
shall be conclusive and binding on the Borrower and the Lenders in the absence
of manifest error.



 33
 









 


2.13.  Inability to Determine Interest Rate.  If prior to the first day of any Interest
Period:


(a)           the
Administrative Agent shall have determined (which determination shall be
conclusive and binding upon the Borrower) that, by reason of circumstances
affecting the relevant market, adequate and reasonable means do not exist for
ascertaining the Eurodollar Rate for such Interest Period, or


(b)           the
Administrative Agent shall have received notice from the Majority Lenders that
the Eurodollar Rate determined or to be determined for such Interest Period
will not adequately and fairly reflect the cost to such Lenders (as
conclusively certified by such Lenders) of making or maintaining their affected
Loans during such Interest Period,


the Administrative Agent
shall give telecopy or telephonic notice thereof to the Borrower and the
relevant Lenders as soon as practicable thereafter.  If such notice is given (x) any Eurodollar
Loans requested to be made on the first day of such Interest Period shall be
made as Base Rate Loans, (y) any Loans that were to have been converted on
the first day of such Interest Period to Eurodollar Loans shall be continued as
Base Rate Loans and (z) any outstanding Eurodollar Loans shall be converted, on
the last day of the then current Interest Period with respect thereto, to Base
Rate Loans.  Until such notice has been
withdrawn by the Administrative Agent, no further Eurodollar Loans shall be
made or continued as such, nor shall the Borrower have the right to convert
Loans to Eurodollar Loans.


2.14.  Pro Rata Treatment and Payments.  (a) 
Each borrowing, other than borrowings of Swing Line Loans, by the
Borrower from the Lenders hereunder, each payment by the Borrower on account of
any facility fee or Letter of Credit fee, and any reduction of the Revolving
Credit Commitments of the Lenders, shall be made pro rata according to the
respective Revolving Credit Percentages of the relevant Lenders.


(b)           Each payment (including each
prepayment) by the Borrower on account of principal of and interest on the
Revolving Credit Loans of the Borrower shall be made pro  rata
according to the respective outstanding principal amounts of the Revolving
Credit Loans of the Borrower then held by the Lenders.  Each payment in respect of Reimbursement
Obligations in respect of any Letter of Credit shall be made to the relevant
Issuing Lender.


(c)           The application of any payment of
Loans shall be made, first, to Base Rate Loans and, second, to
Eurodollar Loans.  Each payment of the
Eurodollar Loans shall be accompanied by accrued interest to the date of such
payment on the amount paid.


(d)           All payments (including prepayments)
to be made by the Borrower hereunder, whether on account of principal,
interest, fees or otherwise, shall be made without condition or deduction for
any counterclaim, defense, recoupment or setoff and shall be made prior to
12:00 Noon, New York City time, on the due date thereof to the Administrative
Agent, for the account of the relevant Lenders, at the 



 34
 









 


Administrative Agent’s Office, in Dollars and in
immediately available funds.  Any payment
made by the Borrower after 12:00 Noon, New York City time, on any Business Day
shall be deemed to have been made on the next following Business Day.  The Administrative Agent shall distribute
such payments to the Lenders promptly upon receipt in like funds as
received.  If any payment hereunder
(other than payments on the Eurodollar Loans) becomes due and payable on a day
other than a Business Day, such payment shall be extended to the next succeeding
Business Day.  If any payment on a
Eurodollar Loan becomes due and payable on a day other than a Business Day, the
maturity thereof shall be extended to the next succeeding Business Day unless
the result of such extension would be to extend such payment into another
calendar month, in which event such payment shall be made on the immediately
preceding Business Day.  In the case of
any extension of any payment of principal pursuant to the preceding two
sentences, interest thereon shall be payable at the then applicable rate during
such extension.


(e)           Unless the Borrower or any Lender has
notified the Administrative Agent, prior to the date any payment is required to
be made by it to the Administrative Agent hereunder, that the Borrower or such
Lender, as the case may be, will not make such payment, the Administrative
Agent may assume that the Borrower or such Lender, as the case may be, has
timely made such payment and may (but shall not be so required to), in reliance
thereon, make available a corresponding amount to the Person entitled thereto.  If and to the extent that such payment was
not in fact made to the Administrative Agent in immediately available funds,
then:


(i)            if the Borrower failed to make such
payment, each Lender shall forthwith on demand repay to the Administrative
Agent the portion of such assumed payment that was made available to such
Lender in immediately available funds, together with interest thereon in
respect of each day from and including the date such amount was made available
by the Administrative Agent to such Lender to the date such amount is repaid to
the Administrative Agent in immediately available funds at the Federal Funds
Rate from time to time in effect; and


(ii)           if any Lender failed to make such
payment, such Lender shall forthwith on demand pay to the Administrative Agent
the amount thereof in immediately available funds, together with interest
thereon for the period from the date such amount was made available by the
Administrative Agent to the Borrower to the date such amount is recovered by
the Administrative Agent (the “Compensation Period”) at a rate per annum
equal to the greater of the Federal Funds Rate and a rate determined by the
Administrative Agent in accordance with banking industry rules on interbank
compensation, plus any administrative, processing or similar fees customarily
charged by the Administrative Agent in connection with the foregoing. If such
Lender pays such amount to the Administrative Agent, then such amount shall
constitute such Lender’s Revolving Credit Percentage of the Loan included in
the applicable borrowing.  If such Lender
does not pay such amount forthwith upon the Administrative Agent’s 



 35
 









 


demand therefor, the Administrative Agent may make a
demand therefor upon the Borrower, and the Borrower shall pay such amount to
the Administrative Agent, together with interest thereon for the Compensation
Period at a rate per annum equal to the rate of interest applicable to the
applicable borrowing.  Nothing herein
shall be deemed to relieve any Lender from its obligation to fulfill its
Revolving Credit Commitment or to prejudice any rights which the Administrative
Agent or the Borrower may have against any Lender as a result of any default by
such Lender hereunder.


A notice of the
Administrative Agent to any Lender or the Borrower with respect to any amount
owing under this subsection (e) shall be conclusive, absent manifest
error.


(f)            The obligations of the Lenders
hereunder to make Loans, to fund participations in Letters of Credit and Swing
Line Loans and to make payments under Section 10.6 are several and not
joint.  The failure of any Lender to make
any Loan, to fund any such participation or to make any payment under Section
10.6 on any date required hereunder shall not relieve any other Lender of
its corresponding obligation to do so on such date, and no Lender shall be
responsible for the failure of any other Lender to so make its Loan, to
purchase its participation or make its payment under Section 10.6.


2.15.  Requirements of Law.  (a)  If
the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof or compliance by any Lender with any
request or directive (whether or not having the force of law) from any central
bank or other Governmental Authority made subsequent to the date hereof:


(i)            shall subject any Lender to any tax
of any kind whatsoever with respect to this Agreement, any Letter of Credit,
any Application or any Eurodollar Loan made by it, or change the basis of
taxation of payments to such Lender in respect thereof (except for Non-Excluded
Taxes or Other Taxes covered by Section 2.16 and the imposition of, or
any change in, the rate of any Excluded Tax payable by such Lender);


(ii)           shall impose, modify or hold
applicable any reserve, special deposit, compulsory loan or similar requirement
against assets held by, deposits or other liabilities in or for the account of,
advances, loans or other extensions of credit by, or any other acquisition of
funds by, any office of such Lender that is not otherwise included in the
determination of the Eurodollar Rate hereunder; or


(iii)          shall impose on such Lender any other
condition;


and the result of any of
the foregoing is to increase the cost to such Lender, by an amount which such
Lender deems to be material, of making, converting into, continuing or
maintaining Eurodollar Loans to the Borrower or issuing or participating in
Letters of Credit issued at the request of the Borrower, or to reduce any
amount receivable hereunder in respect thereof, then, in any such case, the
Borrower shall promptly pay such Lender, upon its demand, any additional
amounts necessary to compensate such Lender for such increased cost or reduced
amount 



 36
 









 


receivable.  If any Lender becomes entitled to claim any
additional amounts pursuant to this Section 2.15, it shall promptly
notify the Borrower (with a copy to the Administrative Agent) of the event by
reason of which it has become so entitled.


(b)           If any Lender shall have determined
that the adoption of or any change in any Requirement of Law regarding capital
adequacy or in the interpretation or application thereof or compliance by such
Lender or any corporation controlling such Lender with any request or directive
regarding capital adequacy (whether or not having the force of law) from any
Governmental Authority made subsequent to the date hereof shall have the effect
of reducing the rate of return on such Lender’s or such corporation’s capital
as a consequence of its obligations hereunder or under or in respect of any
Letter of Credit to a level below that which such Lender or such corporation
could have achieved but for such adoption, change or compliance (taking into
consideration such Lender’s or such corporation’s policies with respect to
capital adequacy) by an amount deemed by such Lender to be material, then from
time to time, after submission by such Lender to the Borrower (with a copy to
the Administrative Agent) of a written request therefor, the Borrower shall pay
to such Lender such additional amount or amounts as will compensate such Lender
or such corporation for such reduction.


(c)           In addition to, and without
duplication of, amounts which may become payable from time to time pursuant to paragraphs
(a) and (b) of this Section 2.15, the Borrower agrees to pay
to each Lender which requests compensation under this paragraph (c) by
notice to the Borrower, on the last day of each Interest Period with respect to
any Eurodollar Loan made by such Lender to the Borrower, at any time when such
Lender shall be required to maintain reserves against “Eurocurrency liabilities”
under Regulation D of the Board of Governors of the Federal Reserve System (or,
at any time when such Lender may be required by the Board of Governors of the
Federal Reserve System or by any other Governmental Authority, whether within
the United States or in another relevant jurisdiction, to maintain reserves
against any other category of liabilities which includes deposits by reference
to which the Eurodollar Rate is determined as provided in this Agreement or
against any category of extensions of credit or other assets of such Lender
which includes any such Eurodollar Loans), an additional amount (determined by
such Lender’s calculation or, if an accurate calculation is impracticable,
reasonable estimate using such reasonable means of allocation as such Lender
shall determine) equal to the actual costs, if any, incurred by such Lender
during such Interest Period as a result of the applicability of the foregoing
reserves to such Eurodollar Loans.


(d)           A certificate as to any additional
amounts payable pursuant to this Section 2.15 submitted by any Lender to
the Borrower (with a copy to the Administrative Agent) shall be conclusive in
the absence of manifest error.  No
Lender  shall be entitled to compensation  under 
this  Section  2.15 from the Borrower for any costs
incurred  or  reductions suffered more than 180 days prior
to the date that such Lender notifies the Borrower of the circumstances giving
rise to such increased costs or reductions and of such Lender’s intention to
claim compensation therefor; provided  that if a change of law
giving rise to such increased 



 37
 









 


costs or reductions is retroactive, then the 180-day
period referred to above shall be extended to include the period of retroactive
effect thereof. The obligations of the Borrower pursuant to this Section
2.15 shall survive the termination of this Agreement and the payment of the
Loans and all other amounts payable hereunder.


2.16.  Taxes. 
(a)  Except as required by Law,
all payments made by the Borrower under this Agreement shall be made free and
clear of, and without deduction or withholding for or on account of, any
present or future income, stamp or other taxes, levies, imposts, duties,
charges, fees, deductions or withholdings, now or hereafter imposed, levied,
collected, withheld or assessed by any Governmental Authority, excluding net
income taxes and franchise and doing business taxes (imposed in lieu of net
income taxes) imposed on the Administrative Agent or any Lender as a result of
a present or former connection between the Administrative Agent or such Lender
and the jurisdiction of the Governmental Authority imposing such tax or any
political subdivision or taxing authority thereof or therein (other than any
such connection arising solely from the Administrative Agent’s or such Lender’s
having executed, delivered or performed its obligations or received a payment
under, or enforced, this Agreement or any other Loan Document) (such net income
taxes and franchise or doing business taxes imposed in lieu of net income taxes
being referred to hereinafter as “Excluded Taxes”).  If any such taxes, levies, imposts, duties,
charges, fees, deductions or withholdings other than Excluded Taxes (“Non-Excluded
Taxes”) or any Other Taxes are required to be withheld from any amounts
payable to the Administrative Agent or any Lender hereunder, the amounts so
payable to the Administrative Agent or such Lender shall be increased to the
extent necessary to yield to the Administrative Agent or such Lender (after
payment of all Non-Excluded Taxes and Other Taxes) interest or any such other
amounts payable hereunder at the rates or in the amounts specified in this
Agreement; provided, however, that the Borrower shall not be
required to increase any such amounts payable to any Lender with respect to any
Non-Excluded Taxes (i) that are attributable to such Lender’s failure to comply
with the requirements of paragraph (d) or (e) of this Section
2.16 or (ii) that are withholding taxes imposed on amounts payable to such
Lender at the time such Lender becomes a party to this Agreement or designates
a new lending office, except to the extent that such Lender (or its assignor,
if any) was entitled, at the time of designation of a new lending office or
assignment, to receive additional amounts from the Borrower with respect to
such Non-Excluded Taxes pursuant to this Section 2.16(a).


(b)           In addition, the Borrower shall pay
any Other Taxes to the relevant Governmental Authority in accordance with
applicable Law.


(c)           Whenever any Non-Excluded Taxes or
Other Taxes are payable by the Borrower, as soon as practicable thereafter the
Borrower shall send to the Administrative Agent for its own account or for the
account of the relevant Lender, as the case may be, a certified copy of an
official receipt received by the Borrower showing payment thereof (or other
evidence of such payment reasonably satisfactory to the Administrative
Agent).  If the Borrower fails to pay any
Non-Excluded Taxes or Other Taxes when due to the appropriate taxing authority,
such the Borrower shall indemnify the Administrative Agent and the Lenders for
any incremental taxes, interest or penalties that may become payable by the
Administrative Agent or any Lender as a result of any such failure.  The agreements 



 38
 









 


in this Section 2.16 shall survive the
termination of this Agreement and the payment of the Loans and all other
amounts payable hereunder.


(d)           Each Lender (or Transferee) that is
not (i) a citizen or resident of the United States of America, (ii) a
corporation, partnership or other entity created or organized in or under the
laws of the United States of America (or any jurisdiction thereof), or (iii) an
estate or trust that is subject to U.S. federal income taxation regardless of
the source of its income (a “Non-U.S. Lender”) that may lawfully
do so shall deliver to the Borrower and the Administrative Agent (or, in the
case of a Participant, to the Lender from which the related participation shall
have been purchased) two copies of either U.S. Internal Revenue Service Form
W-8BEN or Form W-8ECI (or other applicable form), or, in the case of a Non-U.S.
Lender claiming exemption from U.S. federal withholding tax under Section
871(h) or 881(c) of the Code with respect to payments of “portfolio interest”,
a statement substantially in the form of Exhibit D and a Form W-8BEN (or
other applicable form), or to the extent such Lender may lawfully do so, it
shall deliver any subsequent versions thereof or successors thereto properly
completed and duly executed by such Non-U.S. Lender claiming complete
exemption from, or a reduced rate of, U.S. federal withholding tax on all
payments by the Borrower under this Agreement and the other Loan
Documents.  Such forms shall be delivered
by each Non-U.S. Lender on or before the date it becomes a party to this
Agreement (or, in the case of any Participant, on or before the date such
Participant purchases the related participation).  In addition, to the extent it may lawfully do
so, each Non-U.S. Lender shall deliver such forms promptly upon the
obsolescence or invalidity of any form previously delivered by such Non-U.S.
Lender.  Each Non-U.S. Lender shall, as
soon as reasonably practicable, notify the Borrower at any time it determines
that it is no longer in a position to provide any previously delivered certificate
to the Borrower (or any other form of certification adopted by the U.S. taxing
authorities for such purpose). 
Notwithstanding any other provision of this paragraph, a Non-U.S.
Lender shall not be required to deliver any form pursuant to this paragraph
that such Non-U.S. Lender is not legally able to deliver.


(e)           A Lender that is entitled to an
exemption from or reduction of non-U.S. withholding tax under the Law of the
jurisdiction in which the Borrower is located, or any treaty to which such
jurisdiction is a party, with respect to payments under this Agreement shall
deliver to the Borrower (with a copy to the Administrative Agent), at the time
or times prescribed by applicable Law or reasonably requested by the Borrower,
such properly completed and executed documentation prescribed by applicable Law
or reasonably requested by the Borrower as will permit such payments to be made
without withholding or at a reduced rate, provided that such Lender is
legally entitled to complete, execute and deliver such documentation.


2.17.  Compensation for Losses.  The Borrower agrees to, upon demand of any
Lender (with a copy to the Administrative Agent) from time to time, to
indemnify each Lender for, and to hold each Lender harmless from, any loss or
expense that such Lender sustains or incurs as a consequence of
(a) default by the Borrower in making a borrowing of, conversion to or
continuation of Eurodollar Loans after the Borrower has given a notice
requesting the same in 



 39
 









 


accordance with
the provisions of this Agreement, (b) default by the Borrower in making any
prepayment after the Borrower has given a notice thereof in accordance with the
provisions of this Agreement or (c) the making by the Borrower of a prepayment
or conversion of Eurodollar Loans on a day that is not the last day of an
Interest Period with respect thereto; provided that any request for
indemnification made by a Lender pursuant to this Section 2.17 shall be
made within six months of the incurrence of the loss or expense requested to be
indemnified.  Such indemnification may
include an amount equal to the excess, if any, of (i) the amount of interest
that would have accrued on the amount so prepaid, or not so borrowed, converted
or continued, for the period from the date of such prepayment or of such
failure to borrow, convert or continue to the last day of such Interest Period
(or, in the case of a failure to borrow, convert or continue, the Interest
Period that would have commenced on the date of such failure) in each case at
the applicable rate of interest for such Loans provided for herein (excluding,
however, the Applicable Margin included therein, if any) over (ii) the amount
of interest (as reasonably determined by such Lender) that would have accrued
to such Lender on such amount by placing such amount on deposit for a
comparable period with leading banks in the interbank Eurodollar market.  A certificate as to any amounts payable
pursuant to this Section 2.17 submitted to the Borrower by any
Lender shall be conclusive in the absence of manifest error.  This covenant shall survive the termination
of this Agreement and the payment of the Loans and all other amounts payable
hereunder.


2.18.  Illegality.  Notwithstanding any other provision herein,
if the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof shall make it unlawful for any Lender to
make or maintain Eurodollar Loans as contemplated by this Agreement, (a) the
commitment of such Lender hereunder to make Eurodollar Loans, continue Eurodollar
Loans as such and convert Base Rate Loans to Eurodollar Loans shall forthwith
be canceled and (b) such Lender’s Loans then outstanding as Eurodollar Loans,
if any, shall be converted automatically to Base Rate Loans on the respective
last days of the then current Interest Periods with respect to such Loans or
within such earlier period as required by Law. 
If any such conversion of a Eurodollar Loan to a Base Rate Loan occurs
on a day which is not the last day of the then current Interest Period with respect
thereto, the Borrower shall pay to such Lender such amounts, if any, as may be
required pursuant to Section 2.17.


2.19.  Change of Office.  Each Lender agrees that, upon the occurrence
of any event that it knows to give rise to the operation of Sections 2.15,
2.16(a) or 2.18 with respect to such Lender, it will use all
commercially reasonable efforts (subject to overall policy considerations of
such Lender) to designate another lending office for any Loans affected by such
event, or to assign its rights and obligations hereunder with respect to such
Loans to another of its offices, branches or affiliates with the object of
avoiding the consequences of such event, provided, that such designation
is made on terms that, in the reasonable sole judgment of such Lender, cause
such Lender and its lending office(s) to suffer no economic, legal or
regulatory disadvantage, and provided, further, that nothing in this Section
2.19 shall affect or postpone any of the obligations of the Borrower or the
rights of any Lender pursuant to Sections 2.15, 2.16(a) or 2.18.  The Borrower hereby agrees to pay all
reasonable out-of-pocket costs and expenses incurred by any Lender in
connection with any such designation or assignment.


2.20.  Replacement of Lenders under Certain
Circumstances.  The Borrower shall be
permitted to replace any Lender (a) that requests reimbursement for amounts
owing pursuant 



 40
 









 


to Section 2.15,
(b) with respect to which the Borrower is required to pay any amounts under Sections
2.16 or 2.18, (c) that defaults in its obligation to make Loans
hereunder or (d) that fails to approve any amendment which, pursuant to Section
10.1, requires the approval of each Lender, provided, that such
amendment is approved by at least the Majority Lenders, with a replacement
financial institution or other entity; provided that (i) such
replacement does not conflict with any Requirement of Law, (ii) with respect to
a condition described in clause (a) or (b) above, prior to any
such replacement, such replaced Lender shall have taken no action under Section
2.19 so as to eliminate the continued need for payment of amounts owing
pursuant to Sections 2.15, 2.16, or 2.18 (iii) the
replacement financial institution or other entity shall purchase, at par, all
Loans and other amounts owing to such replaced Lender on or prior to the date
of replacement, (iv) the Borrower shall be liable to such replaced Lender under
Section 2.17 (as though Section 2.17 were applicable) if any
Eurodollar Loan to the Borrower owing to such replaced Lender shall be
purchased other than on the last day of the Interest Period relating thereto,
(v) the replacement financial institution or other entity, if not already a
Lender, shall be reasonably satisfactory to the Administrative Agent and
otherwise an Eligible Assignee, (vi)  the
replaced Lender and replacement Lender shall be obligated to make such
replacement in accordance with the provisions of Section 10.7
(including, without limitation, obtaining the consents provided for therein)
(provided that the Borrower shall be obligated to pay the registration and
processing fee referred to therein), (vii) the Borrower shall pay all
additional amounts (if any) required pursuant to Section 2.15, 2.16
or 2.18, as the case may be, in respect of any period prior to the date
on which such replacement shall be consummated, and (viii) any such
replacement shall not be deemed to be a waiver of any rights that the Borrower,
the Administrative Agent or any other Lender shall have against the replaced
Lender.


2.21.    Guaranty
of Payment and Performance.


(a)           Guaranty
by Parent of the Borrower’s Obligations. 
Parent (being referred to herein in its capacity as guarantor as a “Guarantor”)
hereby guarantees (such guaranty being hereinafter referred to as the “Parent
Guaranty”) to the Lenders and the Administrative Agent the full and
punctual payment when due (whether at stated maturity, by required pre-payment,
by acceleration or otherwise) of all of the obligations of the Borrower
hereunder and under the other Loan Documents (including, but not limited to,
the principal of the Loans advanced to the Borrower, all Reimbursement
Obligations of the Borrower in respect of Letters of Credit, and all interest,
fees, expenses, indemnities and other amounts payable by the Borrower hereunder),
including all such which would become due but for the operation of the
automatic stay pursuant to §362(a) of the Federal Bankruptcy Code and the operation of §502(b) of the Federal
Bankruptcy Code.  The Parent Guaranty is
an absolute, unconditional and continuing guaranty of the full and punctual
payment and performance of all such obligations of the Borrower hereunder and
under the other Loan Documents, and not of their collectibility only and is in
no way conditioned upon any requirement that the Administrative Agent or any
Lender first attempt to collect any of the Borrower’s obligations from the
Borrower or resort to any other means of obtaining payment.  Should an Event of Default occur with respect
to the payment or performance of any such obligations of the Borrower, the
obligations of Parent under the Parent Guaranty with respect to such
obligations in default shall, upon demand by the Administrative Agent, become
immediately due and payable to the Administrative Agent, for the benefit of the
Lenders and the Administrative Agent, without demand or notice of any nature,
all of which are expressly waived by Parent. 
Payments by Parent in respect of the Parent Guaranty may be 



 41
 









 


required by the Administrative Agent on any number of occasions.  All payments by Parent in respect of the
Parent Guaranty shall be made to the Administrative Agent, in the manner and at
the place of payment specified hereunder, for the account of the Lenders and
the Administrative Agent.


(b)           Agreement to Pay Enforcement Costs,
etc.  The
Guarantor further agrees, as the principal obligor and not as a guarantor only,
to pay to the Administrative Agent, on demand, all costs and expenses
(including court costs and legal expenses) incurred or expended by the
Administrative Agent or any Lender in connection with the Parent Guaranty and
the enforcement thereof, together with interest on amounts recoverable under
this Section 2.21(b) from the time when such amounts become due until
payment, whether before or after judgment, at the rate of interest for overdue
principal set forth in this Agreement, provided  that if such
interest would exceed the Maximum Rate, then such interest shall be reduced to
such Maximum Rate.


(c)           Waivers by the Guarantor; Lenders’
Freedom to Act.  To the fullest
extent permitted by applicable law, the Guarantor agrees that the obligations
that it has guaranteed hereunder will be paid and performed strictly in
accordance with their respective terms, regardless of any Law now or hereafter
in effect in any jurisdiction affecting any of such terms or the rights of the
Administrative Agent or any Lender with respect thereto.  To the fullest extent permitted by applicable
Law, the Guarantor waives promptness, diligences, presentment, demand, protest,
notice of acceptance, notice of any obligations incurred and all other notices
of any kind, all defenses which may be available by virtue of any valuation,
stay, moratorium law or other similar Law now or hereafter in effect, any right
to require the marshalling of assets of the Borrower or any other entity or
other person primarily or secondarily liable with respect to any of the
obligations, and all suretyship defenses generally.  Without limiting the generality of the
foregoing, the Guarantor agrees to the provisions of any instrument evidencing
or otherwise executed in connection with any obligation and agrees, to the
fullest extent permitted by applicable Law, that its obligations in respect of
the Parent Guaranty shall not be released or discharged, in whole or in part, or
otherwise affected by (i) the failure of the Administrative Agent or any Lender
to assert any claim or demand or to enforce any right or remedy against the
Borrower or any other entity or other person primarily or secondarily liable
with respect to any of the obligations; (ii) any extensions, compromise,
refinancing, consolidation or renewals of any obligation; (iii) any change in
the time, place or manner of payment of any of the obligations or any
rescissions, waivers, compromise, refinancing, consolidation or other
amendments or modifications of any of the terms or provisions of this Agreement
or the other Loan Documents or any other agreement evidencing or otherwise
executed in connection with any of the obligations, (iv) the addition,
substitution or release of any entity or other person primarily or secondarily
liable for any obligation; (v) the adequacy of any rights which the
Administrative Agent or any Lender may have against any means of obtaining
repayment of any of the obligations; or (vi) any other act or omission which
might in any manner or to any extent vary the risk of the Guarantor or
otherwise operate as a release or discharge of the Guarantor, all of which may
be done without notice to the Guarantor. To the fullest extent permitted by Law,
the Guarantor hereby expressly waives any and all rights or defenses arising by
reason of (A) any “one action” or “anti-deficiency” Law which would otherwise
prevent the Administrative Agent or any Lender from bringing any action,
including any claim for a deficiency, or exercising any other right or remedy
(including any right of set-off), against the Guarantor before or after the 



 42
 









 


Administrative
Agent’s or such Lender’s commencement or completion of any foreclosure action,
whether judicially, by exercise of power of sale or otherwise, or (B) any other
Law which in any other way would otherwise require any election of remedies by
the Administrative Agent or any Lender.


(d)           Unenforceability of Obligations
Against the Borrower.  If for any reason the Borrower has
no legal existence or is under no legal obligation to discharge any of its
obligations under this Agreement or under the other Loan Documents guaranteed
by the Guarantor, or if any of such obligations have become irrecoverable from
the Borrower by reason of the Borrower’s bankruptcy or reorganization or by
other operation of Law or for any other reason, the Guarantee shall, to the
fullest extent permitted by applicable Law, nevertheless be binding on the
Guarantor to the same extent as if the Guarantor at all times had been the
principal obligor on all such obligations. 
In the event that acceleration of the time for payment of any of the
guaranteed obligations of the Borrower under this Agreement or the other Loan
Documents is stayed upon the insolvency, bankruptcy or reorganization of the
Borrower, or for any other reason, all such obligations otherwise subject to
acceleration under the terms of this Agreement and the other Loan Documents or
any other agreement evidencing or otherwise executed in connection with any
such obligation shall be immediately due and payable by the Guarantor.


(e)           Subrogation.  Until the final payment and performance in
full of all of the obligations of the Borrower under this Agreement and the
other Loan Documents, the Guarantor shall not exercise any rights against the
Borrower arising as a result of payment by the Guarantor in respect of the
Parent Guaranty, by way of subrogation, reimbursement, restitution,
contribution or otherwise, and will not prove any claim in competition with the
Administrative Agent or any Lender in respect of any payment hereunder in any
bankruptcy, insolvency or reorganization case or proceedings of any nature and
the Guarantor will not claim any setoff, recoupment or counterclaim against the
Borrower in respect of any liability of the Guarantor to the Borrower.


(f)            Provisions Supplemental.  The provisions of
this Section 2.21 shall be supplemental to and not in derogation of any
other rights and remedies of the Lenders and the Administrative Agent under
this Agreement, the other Loan Documents and any separate subordination
agreement which the Administrative Agent may at any time and from time to time
enter into with the Guarantor for the benefit of the Lenders and the
Administrative Agent.


(g)           Further Assurances.  The Guarantor agrees
that it will from time to time, at the request of the Administrative Agent, do
all such things and execute all such documents as the Administrative Agent may
reasonably request to give full effect to the Parent Guaranty and to preserve
the rights and powers of the Lenders and the Administrative Agent in respect of
the Parent Guaranty.  The Guarantor
acknowledges and confirms that it has established its own adequate means of obtaining
from the Borrower on a continuing basis all information desired by the
Guarantor concerning the financial condition of the Borrower and that the
Guarantor will look to the Borrower and not to the Administrative Agent or any
Lender in order for the Guarantor to keep adequately informed of changes in the
Borrower’s financial condition.


 



 43















 


(h)           Successors and Assigns.  The Parent Guaranty
shall be binding upon the Guarantor, its successors and assigns, and shall
inure to the benefit of the Administrative Agent and the Lenders and their
respective  permitted transferees and permitted assigns.  Without limiting the generality of the
foregoing sentence, each Lender may, to the extent permitted by Section 10.7,
assign or otherwise transfer this Agreement, the other Loan Documents or any
other agreement or Note held by it evidencing or otherwise executed in
connection with the guaranteed obligations, or sell participations in any
interest therein, to any other entity or other person, and such other entity or
other person shall, to the extent provided by Section 10.7, thereupon
become vested, to the extent set forth in the agreement evidencing such
assignment, transfer or participation, with all the rights in respect thereof
granted to such Lender herein, all in accordance with Section 10.7 of
this Agreement.


2.22.  Increase in Commitments.


(a)           Request for Increase.  Upon notice to the Administrative Agent
(which shall promptly notify the Lenders), the Borrower may from time to time,
increase the Total Revolving Credit Commitments by an amount not to exceed
$25,000,000 less the aggregate amount of all prior increases of the Total
Revolving Credit Commitment pursuant to this Section 2.22.  Such increase in the Total Revolving Credit
Commitments may be provided by the Lenders or Eligible Assignees designated by
the Borrower to become Lenders (pursuant to an instrument of accession in the
form of Exhibit I hereto) that are willing to provide such increase; provided
that (i) any such increase shall be in a minimum amount of $5,000,000 and (ii)
the aggregate amount of the Total Revolving Credit Commitments after giving
effect to any such increase shall not at any time exceed $100,000,000.  Nothing contained herein shall constitute, or
otherwise be deemed to be, a commitment on the part of any Lender to increase
its Revolving Credit Commitment hereunder.


(b)           Effective Date and Allocations.  If the Total Revolving Credit Commitments are
increased in accordance with this Section 2.22, the Administrative Agent
and the Borrower shall determine the effective date (the “Increase Effective
Date”) and the Borrower, in consultation with the Administrative Agent,
shall determine the final allocation of such increase.  The Administrative Agent shall promptly
notify the Lenders of the final allocation of such increase and the Increase
Effective Date.


(c)           Conditions to Effectiveness
of Increase.  As a condition
precedent to such increase, (i) no Default shall exist, (ii) the Borrower shall
(x) deliver to the Administrative Agent (1) an Instrument of Accession executed
by the Borrower and the applicable Lender(s), and (2) a certificate dated as of
the Increase Effective Date (in sufficient copies for each Lender) signed by a
Responsible Officer of each Loan Party (A) certifying and attaching the
resolutions adopted by the Loan Parties approving or consenting to such
increase, and (B) certifying that, before and after giving effect to such
increase no Default exists and (iii pursuant to the terms of the Arranger Fee
Letter, pay the fees to the applicable Persons. 
The Borrower shall prepay any Revolving Credit Loans outstanding on the
Increase Effective Date (and pay any additional amounts required pursuant to Section
2.15) to the extent necessary 



 44
 









 


to keep the outstanding Revolving Credit Loans ratable
with any revised Revolving Credit Percentages arising from any nonratable increase
in the Total Revolving Credit Commitments under this Section 2.22.


(d)           Conflicting Provisions.  This Section 2.22 shall supersede any
provisions in Section 2.14 or 10.1 to the contrary.


3.             LETTERS OF CREDIT


3.1.  L/C Commitment.  (a) 
Subject to the terms and conditions hereof, each Issuing Lender, in
reliance on the agreements of the other Lenders set forth in Section 3.3,
agrees to issue Letters of Credit for the account of the Borrower or any of its
Subsidiaries and to amend or extend Letters of Credit previously issued by it,
in accordance with Section 3.2(b), on any Business Day during the
Revolving Credit Commitment Period in such form as may be approved from time to
time by the Issuing Lender; provided, that the Issuing Lender shall not
issue any Letter of Credit if, after giving effect to such issuance, (i) the
L/C Obligations would exceed the L/C Commitment or (ii) the aggregate amount of
the Available Revolving Credit Commitments would be less than zero.  Each Letter of Credit shall (i) be denominated
in Dollars and (ii) expire no later than the earlier of (x) the first
anniversary of its date of issuance and (y) the date which is five Business
Days prior to the Revolving Credit Termination Date, provided that any
Letter of Credit with a one-year term may provide for the renewal thereof for
additional one-year periods (which shall in no event extend beyond the date
referred to in clause (y) above). 
All Existing Letters of Credit shall be deemed to have been issued
pursuant hereto, and from and after the Closing Date shall be subject to and
governed by the terms and conditions hereof.


(b)                   No Issuing Lender shall at
any time be obligated to issue any Letter of Credit hereunder if (i) such
issuance would conflict with, or cause the Issuing Lender or any L/C
Participant to exceed any limits imposed by, any applicable Requirement of Law,
(ii) such issuance would violate one or more policies of the Issuing Lender
applicable to letters of credit generally or (iii) any order, judgment or
decree of any Governmental Authority or arbitrator shall by its terms purport
to enjoin or restrain the Issuing Lender from issuing such Letter of Credit, or
any Law applicable to the Issuing Lender or any request or directive (whether
or not having the force of Law) from any Governmental Authority with
jurisdiction over the Issuing Lender shall prohibit, or request that the
Issuing Lender refrain from, the issuance of letters of credit generally or
such Letter of Credit in particular.


3.2.  Procedure for Issuance and Amendment of
Letter of Credit.  (a) Each Letter of
Credit shall be issued or amended, as the case may be, upon the request of the
Borrower delivered to the Issuing Lender (with a copy to the Administrative
Agent) in the form of an Application, completed and signed by a Responsible
Officer of the Borrower.  Such
Application must be received by the Issuing Lender and the Administrative Agent
not later than 11:00 A.M., New York City time, at least two Business Days (or
such later date and time as the Administrative Agent and the Issuing Lender may
agree in a particular instance in their sole discretion) prior to the proposed
issuance date or date of amendment, as the case may be.  In the 



 45
 









case of a request
for an initial issuance of a Letter of Credit, such Application shall specify
in form and detail reasonably satisfactory to the Issuing Lender: (A) the
proposed issuance date of the requested Letter of Credit (which shall be a
Business Day); (B) the amount thereof; (C) the expiry date thereof; (D) the
name and address of the beneficiary thereof; (E) the documents to be presented
by such beneficiary in case of any drawing thereunder; (F) the full text of any
certificate to be presented by such beneficiary in case of any drawing
thereunder; and (G) such other matters as the Issuing Lender may reasonably
require.  In the case of a request for an
amendment of any outstanding Letter of Credit, such Application shall specify
in form and detail reasonably satisfactory to the Issuing Lender (A) the Letter
of Credit to be amended; (B) the proposed date of amendment thereof (which
shall be a Business Day); (C) the nature of the proposed amendment; and (D)
such other matters as the Issuing Lender may reasonably require.  Additionally, the Borrower shall furnish to
the Issuing Lender and the Administrative Agent such other documents and
information pertaining to such requested Letter of Credit issuance or
amendment, including any Issuer Documents, as the Issuing Lender or the
Administrative Agent may reasonably require.


(b)           Promptly after receipt of any
Application, the Issuing Lender will confirm with the Administrative Agent (by
telephone or in writing) that the Administrative Agent has received a copy of
such Application from the Borrower and, if not, the Issuing Lender will provide
the Administrative Agent with a copy thereof. 
Unless the Issuing Lender has received written notice from any Lender or
the Administrative Agent, at least one Business Day prior to the requested date
of issuance or amendment of the applicable Letter of Credit, that one or more
applicable conditions contained in Section 4 shall not then be
satisfied, then, subject to the terms and conditions hereof, the Issuing Lender
shall, on the requested date, issue a Letter of Credit for the account of the
Borrower or enter into the applicable amendment, as the case may be, in each
case in accordance with the Issuing Lender’s usual and customary business
practices.  Immediately upon the issuance
of each Letter of Credit, each Lender shall be deemed to, and hereby irrevocably
and unconditionally agrees to, purchase from the Issuing Lender a risk
participation in such Letter of Credit in an amount equal to the product of
such Lender’s Revolving Credit Percentage times the amount of such
Letter of Credit.


(c)           Promptly after its delivery of any
Letter of Credit or any amendment to a Letter of Credit to an advising bank
with respect thereto or to the beneficiary thereof, the Issuing Lender will
also deliver to the Borrower and the Administrative Agent a true and complete
copy of such Letter of Credit or amendment.


3.3.  Drawings and Reimbursements; Funding of
Participations.  (a)  Upon receipt from the beneficiary of any
Letter of Credit of any notice of a drawing under such Letter of Credit, the
Issuing Lender shall notify the Borrower and the Administrative Agent
thereof.  The Borrower shall reimburse
the Issuing Lender, through the Administrative Agent, for the amount of any
drawing under a Letter of Credit not later than 1:00 P.M., New York City time,
on the date that such drawing is made (if the Borrower has received notice from
the Issuing Lender of such drawing prior to 10:00 A.M., New York City time, on
such date) or, if the Borrower has not received notice of such drawing prior to
such time on such date, then not later than 1:00 P.M., 



 46
 









 


New York City
time, on (i) the Business Day that the Borrower receives such notice, if
such notice is received prior to 10:00 A.M., New York City time, on the
day of receipt, or (ii) the Business Day immediately following the day that
the Borrower receives such notice, if such notice is not received prior to
10:00 A.M., New York City time, on the day of such receipt (the date on
which such reimbursement by the Borrower is due pursuant to this sentence being
referred to herein as the “Requested Reimbursement Date”).  If the Borrower fails to so reimburse the
Issuing Lender by such time, the Administrative Agent shall promptly notify
each Lender of the Requested Reimbursement Date, the amount of the unreimbursed
drawing (the “Unreimbursed Amount”), and the amount of such Lender’s
Revolving Credit Percentage thereof.  In
such event, the Borrower shall be deemed to have requested a borrowing of Base
Rate Loans to be disbursed on the Requested Reimbursement Date in an amount
equal to the Unreimbursed Amount, without regard to the minimum and multiples,
and notice periods, specified in Section 2.2 for the principal amount of
Base Rate Loans.  Such Base Rate Loans
may from time to time be converted to Eurodollar Loans, as determined by the
Borrower and notified to the Administrative Agent in accordance with Section
2.9, provided that no Revolving Credit Loan shall be made as a Eurodollar
Loan after the day that is one month prior to the Revolving Credit Termination
Date.  Any notice given by the Issuing
Lender or the Administrative Agent pursuant to this Section 3.3(a) may
be given by telephone if immediately confirmed in writing; provided that the
lack of such an immediate confirmation shall not affect the conclusiveness or
binding effect of such notice.


(b)           Each Lender (including the Lender
acting as Issuing Lender) shall upon any notice pursuant to Section 3.3(a)
make funds available to the Administrative Agent for the account of the Issuing
Lender at the Administrative Agent’s Office in an amount equal to its Revolving
Credit Percentage of the Unreimbursed Amount not later than 1:00 P.M., New York
City time, on the Business Day specified in such notice by the Administrative
Agent, whereupon, subject to the provisions of Section 3.3(a), each Lender
that so makes funds available shall be deemed to have made a Base Rate Loan to
the Borrower in such amount.  The
Administrative Agent shall remit the funds so received to the Issuing Lender.


(c)           If any drawing is made under a Letter
of Credit and is not reimbursed or refinanced on the date such drawing is made,
for any reason, the Borrower shall be deemed to have incurred  from the Issuing Lender an L/C Borrowing in the amount of
the Unreimbursed Amount that is not so reimbursed or refinanced, which L/C
Borrowing (i) shall bear interest at the rate applicable to Base Rate
Loans from and including the date that such drawing is paid by the Issuing Bank
to but excluding the earlier of the date that such Unreimbursed Amount is so
reimbursed or refinanced or the date that is the next Business Day following
the Requested Reimbursement Date and, if not so reimbursed or refinanced on or
prior to the date that is the next Business Day following the Requested
Reimbursement Date, then, from and after the date that is the next Business Day
following the Requested Reimbursement Date to but excluding the date so
reimbursed or refinanced, the rate applicable to Base Rate Loans plus 2% and
(ii) shall, on and after the date that is the next Business Day following
the Requested Reimbursement  Date, be due
and payable on demand.  In such event,
each Lender’s payment to the Administrative Agent for the account of the
Issuing Lender pursuant to Section 3.3(b) shall be 



 47
 









 


deemed payment in respect of its participation in such
L/C Borrowing and shall constitute an L/C Advance from such Lender in
satisfaction of its participation obligation under this Section 3.3.


(d)           Until each Lender funds its Loan or
L/C Advance pursuant to this Section 3.3 to reimburse the Issuing Lender
for any amount drawn under any Letter of Credit, interest in respect of such
Lender’s Revolving Credit Percentage of such amount shall be solely for the
account of the Issuing Lender.


(e)           Each Lender’s obligation to make
Loans or L/C Advances to reimburse the Issuing Lender for amounts drawn under
Letters of Credit, as contemplated by this Section 3.3, shall be
absolute and unconditional and shall not be affected by any circumstance,
including (A) any set-off, counterclaim, recoupment, defense or other right
which such Lender may have against the Issuing Lender, any Loan Party or any
other Person for any reason whatsoever, (B) the occurrence or continuance of a
Default, or (C) any other occurrence, event or condition, whether or not
similar to any of the foregoing; provided, however, that each
Lender’s obligation to make Loans pursuant to this Section 3.3 is
subject to the conditions set forth in Section 4.2 (other than delivery
by the Borrower of a Loan Notice).  No
such making of an L/C Advance shall relieve or otherwise impair the obligation
of the Borrower to reimburse the Issuing Lender for the amount of any payment
made by the Issuing Lender under any Letter of Credit, together with interest
as provided herein.


(f)            If any Lender fails to make
available to the Administrative Agent for the account of the Issuing Lender any
amount required to be paid by such Lender pursuant to the foregoing provisions
of this Section 3.3 by the time specified in Section 3.3(b), the
Issuing Lender shall be entitled to recover from such Lender (acting through
the Administrative Agent), on demand, such amount with interest thereon for the
period from the date such payment is required to the date on which such payment
is immediately available to the Issuing Lender at a rate per annum equal to the
greater of the Federal Funds Rate and a rate determined by the Issuing Lender
in accordance with banking industry rules on interbank compensation, plus any
administrative, processing or similar fees customarily charged by the Issuing
Lender in connection with the foregoing. 
If such Lender pays such amount (with interest and fees as aforesaid),
the amount so paid shall constitute such Lender’s Loan included in the relevant
borrowing or L/C Advance in respect of the relevant L/C Borrowing, as the case
may be.  A certificate of the Issuing
Lender submitted to any Lender (through the Administrative Agent) with respect
to any amounts owing under this paragraph (f) shall be conclusive absent
manifest error.


3.4.  Repayment of Participations.  (a)  At
any time after the Issuing Lender has made a payment under any Letter of Credit
and has received from any Lender such Lender’s L/C Advance in respect of such
payment in accordance with Section 3.3(b), if the Administrative Agent
receives for the account of the Issuing Lender any payment in respect of the
related Unreimbursed Amount or interest thereon (whether directly from the
Borrower or otherwise, including proceeds of cash collateral applied thereto by
the Administrative Agent), the Administrative Agent will distribute to such
Lender its Revolving Credit Percentage thereof 



 48
 









 


(appropriately
adjusted, in the case of interest payments, to reflect the period of time
during which such Lender’s L/C Advance was outstanding) in the same funds as
those received by the Administrative Agent.


(b)           If any payment received by the
Administrative Agent for the account of the Issuing Lender pursuant to Section
3.3(b) is required to be returned under any of the circumstances described
in Section 10.8 (including pursuant to any settlement entered into by
the Issuing Lender in its discretion), each Lender shall pay to the
Administrative Agent for the account of the Issuing Lender its Revolving Credit
Percentage thereof on demand of the Administrative Agent, plus interest thereon
from the date of such demand to the date such amount is returned by such
Lender, at a rate per annum equal to the Federal Funds Rate from time to time
in effect.


3.5.  Obligations Absolute.  The obligation of the Borrower to reimburse
the Issuing Lender for each drawing under each Letter of Credit and to repay
each L/C Borrowing shall be absolute, unconditional and irrevocable, and shall
be paid strictly in accordance with the terms of this Agreement under all
circumstances, including the following:


(i)            any lack of validity or
enforceability of such Letter of Credit, this Agreement, or any other Loan
Document;


(ii)           the existence of any claim,
counterclaim, set-off, defense or other right that the Borrower or any of its
Subsidiaries may have at any time against any beneficiary or any transferee of
such Letter of Credit (or any Person for whom any such beneficiary or any such
transferee may be acting), the Issuing Lender or any other Person, whether in
connection with this Agreement, the transactions contemplated hereby or by such
Letter of Credit or any agreement or instrument relating thereto, or any
unrelated transaction;


(iii)          any draft, demand, certificate or
other document presented under such Letter of Credit proving to be forged,
fraudulent, invalid or insufficient in any respect or any statement therein
being untrue or inaccurate in any respect; or any loss or delay in the
transmission or otherwise of any document required in order to make a drawing
under such Letter of Credit;


(iv)          any payment by the Issuing Lender
under such Letter of Credit against presentation of a draft or certificate that
does not strictly comply with the terms of such Letter of Credit; or any
payment made by the Issuing Lender under such Letter of Credit to any Person
purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for
the benefit of creditors, liquidator, receiver or other representative of or
successor to any beneficiary or any transferee of such Letter of Credit,
including any arising in connection with any proceeding under any Debtor Relief
Law; or


(v)           any other circumstance or happening
whatsoever, whether or not similar to any of the foregoing, including any other
circumstance that might 



 49
 









 


otherwise constitute a defense available to, or a
discharge of, the Borrower or any of its Subsidiaries.


3.6.  Role of Issuing Lender.  Each Lender and the
Borrower agrees that, in paying any drawing under a Letter of Credit, the
Issuing Lender shall not have any responsibility to obtain any document (other
than any sight draft, certificates and documents expressly required by the
Letter of Credit) or to ascertain or inquire as to the validity or accuracy of
any such document or the authority of the Person executing or delivering any
such document.  None of the Issuing
Lender, any Agent-Related Person nor any of the respective correspondents,
participants or assignees of the Issuing Lender shall be liable to any Lender
for (a) any action taken or omitted in connection herewith at the request or
with the approval of the Lenders or the Majority Lenders, as applicable; (b)
any action taken or omitted in the absence of gross negligence or willful
misconduct; or (c) the due execution, effectiveness, validity or enforceability
of any document or instrument related to any Letter of Credit or
Application.  The Borrower hereby assumes
all risks of the acts or omissions of any beneficiary or transferee with
respect to its use of any Letter of Credit; provided, however,
that this assumption is not intended to, and shall not, preclude the Borrower’s
pursuing such rights and remedies as it may have against the beneficiary or
transferee at law or under any other agreement. 
None of the Issuing Lender, any Agent-Related Person, nor any of the
respective correspondents, participants or assignees of the Issuing Lender,
shall be liable or responsible for any of the matters described in clauses
(i) through (v) of Section 3.5; provided, however,
that anything in such clauses (i) through (v) to the contrary
notwithstanding, the Borrower may have a claim against the Issuing Lender, and
the Issuing Lender may be liable to the Borrower, to the extent, but only to
the extent, of any direct, as opposed to consequential or exemplary, damages
suffered by the Borrower which the Borrower proves were caused by the Issuing
Lender’s willful misconduct or gross negligence or the Issuing Lender’s willful
failure to pay under any Letter of Credit after the presentation to it by the
beneficiary of a sight draft and certificate(s) strictly complying with the terms
and conditions of a Letter of Credit.   In furtherance and not in limitation of the
foregoing, the Issuing Lender may accept documents that appear on their face to
be in order, without responsibility for further investigation, regardless of
any notice or information to the contrary, and the Issuing Lender shall not be
responsible for the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign a Letter of Credit or the rights
or benefits thereunder or proceeds thereof, in whole or in part, which may
prove to be invalid or ineffective for any reason.


3.7.  Cash Collateral.  Upon the request of the Administrative Agent,
if, as of the Revolving Credit Termination Date, any Letter of Credit for any
reason remains outstanding and partially or wholly undrawn, the Borrower shall
immediately Cash Collateralize the then outstanding amount of all L/C
Obligations (in an amount equal to such outstanding amount determined as of the
Revolving Credit Termination Date).  Sections
2.8 and 8.2 set forth certain additional requirements to deliver
Cash Collateral hereunder.  To the extent
that the Borrower is required to Cash Collateralize L/C Obligations, the
Borrower hereby grants to the Administrative Agent, for the benefit of the
Issuing Lender and the Lenders, a security interest in all cash, deposit
accounts and all balances therein and all proceeds of the foregoing.  Such cash collateral shall be maintained in
blocked, interest bearing deposit accounts with the Administrative Agent.



 50
 









 


3.8.  Applicability of ISP98 and UCP.  Unless otherwise
expressly agreed by the Issuing Lender and the Borrower when a Letter of Credit
is issued including any such agreement as applicable to an Existing Letter of
Credit, (i) the rules of the ISP shall apply to each standby Letter of Credit,
and (ii) the rules of the Uniform Customs and Practice for Documentary Credits,
as most recently published by the International Chamber of Commerce at the time
of issuance shall apply to each commercial Letter of Credit.


3.9.  Fees and Other Charges.  (a) 
The Borrower will pay to the Administrative Agent, for the account of
the Lenders, a fee on the daily amount available to be drawn under all
outstanding Letters of Credit issued for its account at a per annum rate equal
to the Applicable Margin then in effect with respect to Eurodollar Loans, to be
shared ratably among the Lenders in accordance with their respective Revolving
Credit Percentages and payable quarterly in arrears on each L/C Fee Payment
Date after the issuance date.  In
addition, the Borrower shall pay to the relevant Issuing Lender for its own
account a fronting fee on the daily amount available to be drawn under all
outstanding Letters of Credit issued by such Issuing Lender for the Borrower’s
account at a rate and at the times to be agreed upon by the Borrower and such
Issuing Lender.  For purposes of
computing the average daily amount available to be drawn under the Letters of
Credit, the amount of such Letters of Credit shall be determined in accordance
with Section 1.3.


(b)           In addition to the foregoing fees,
the Borrower shall pay or reimburse each Issuing Lender for such normal and
customary costs and expenses as are incurred or charged by such Issuing Lender
in issuing, negotiating, effecting payment under, amending or otherwise
administering any Letter of Credit issued for the account of the Borrower.


3.10.  Conflict with Issuer Documents.  In the event of any conflict between the
terms hereof and the terms of any Issuer Document, the terms hereof shall
control.


4.             CONDITIONS PRECEDENT


4.1.  Conditions to Closing.  The occurrence of the Closing Date is subject
to the satisfaction on such date of the following conditions precedent:


(a)           The Administrative Agent’s receipt of
the following, each of which shall be originals or telecopies (followed
promptly by originals) unless otherwise specified, each properly executed by a
Responsible Officer of the signing Loan Party, each dated the Closing Date (or,
in the case of certificates of governmental officials, a recent date before the
Closing Date) and each in form and substance reasonably satisfactory to the
Administrative Agent:


(i)            executed counterparts of this
Agreement, sufficient in number for distribution to the Administrative Agent,
each Lender party hereto on the date hereof, the Borrower and the Parent;


(ii)           a Note executed by the Borrower in
favor of each Lender requesting a Note so long as such request is made at least
3 Business Days prior to the Closing Date;



 51
 









 


(iii)          such certificates of resolutions or
other action, incumbency certificates and/or other certificates of Responsible
Officers of each Loan Party as the Administrative Agent may reasonably require
evidencing the identity, authority and capacity of each Responsible Officer thereof
authorized to act as a Responsible Officer in connection with this Agreement
and the other Loan Documents to which such Loan Party is a party;


(iv)          such documents and certifications as
the Administrative Agent may reasonably require to evidence that each Loan
Party is duly organized or formed, and that each Loan Party is validly existing, in good standing and
qualified to engage in business in the jurisdiction where such Loan Party is
organized;


(v)           a Closing Certificate of each Loan
Party with appropriate insertions and attachments, if any;


(vi)          a certificate signed by a
Responsible Officer on behalf of each Loan Party either (A) attaching copies of
all consents, licenses and approvals required in connection with the execution,
delivery and performance by such Loan Party and the validity against such Loan
Party of the Loan Documents to which it is a party, and such consents, licenses
and approvals shall be in full force and effect, or (B) stating that no such
consents, licenses or approvals are so required;


(vii)         a certificate signed by a
Responsible Officer on behalf of each Loan Party certifying (A) that the
conditions specified in Sections 4.2(a) and (b) have been
satisfied, and (B) that there has been
no event or circumstance since December 31, 2005 that has had or could be
reasonably expected to have, either individually or in the aggregate, a
Material Adverse Effect.


(viii)        a Borrowing Request appropriately
completed and signed by a Responsible Officer on behalf of the Borrower, in
respect of the initial borrowing of Loans;


(ix)           copies certified by a Responsible
Officer on behalf of the Borrower of the White Mountains Loan Documents duly
executed by the parties thereto;


(b)           Fees.  (i) 
The Administrative Agent and the Arrangers shall have received all fees
required to be paid by the Borrower on or prior to the Closing Date.


(ii)           The Borrower shall have paid all
fees, charges and disbursements of Bingham McCutchen LLP, as counsel to the
Administrative Agent (directly to such counsel if requested by the Administrative
Agent), to the extent required to be paid by the Borrower and invoiced prior to
the Closing Date.


(c)           Legal Opinions.  The Administrative Agent shall have received
(i) the legal opinions of Thomas Forsyth, Esquire and Robert Seelig, Esquire, each
as 



 52
 









 


counsel to the Loan Parties, substantially in the form
of Exhibit F-1 and F-2, respectively and (ii) the legal opinion
of Conyers Dill & Pearman, Bermuda counsel to the Parent, substantially in
the form of Exhibit G.


(d)           Termination of Existing Credit
Facility.  The Administrative Agent
shall have received evidence (including, without limitation, payoff letters),
reasonably satisfactory to the Administrative Agent in its reasonable
discretion, that the Existing Credit
Agreement has been or concurrently with the Closing Date is being terminated.


(e)           Initial Public Offering.  Parent shall have consummated the IPO.


(f)            Closing Date.  The Closing Date shall occur on or before
April 30, 2007.


(g)           Economic Defeasance of Fund
American Preferred Stock.  Arrangements
reasonably satisfactory to the Administrative Agent shall have been made for
the establishment of grantor trusts to provide for the payment or redemption of
the Fund American Preferred Stock.


(h)           Material Adverse Effect.  Up to and including the Closing Date, since
December 31, 2005 there has been no development or event that has had or could
reasonably be expected to have a Material Adverse Effect.


4.2.  Conditions to Closing and Each Extension
of Credit.  The occurrence of the
Closing Date and the agreement of each Lender to make any extension of credit
requested to be made by it hereunder on any date (including, without
limitation, its initial extension of credit but excluding conversions or
continuations of Loans) is subject to the satisfaction of the following
conditions precedent:


(a)           Representations and Warranties.  Each of the representations and warranties
made by the Loan Parties in Section 5 (other than Section 5.5) or
pursuant to any of the other Loan Documents shall be true and correct in all
material respects on and as of such date as if made on and as of such date,
except to the extent that they expressly relate to an earlier date, in which
case they shall be true and correct in all material respects as of such earlier
date.


(b)           No Default.  No Default or Event of Default shall have
occurred and be continuing on such date or after giving effect to the
extensions of credit requested to be made on such date.


(c)           Borrowing Request.  Except as provided in Section 3.3, the
Administrative Agent shall have received a Borrowing Request or, as applicable,
an Application.


Each borrowing by and
issuance of a Letter of Credit on behalf of the Borrower hereunder shall
constitute a representation and warranty by the Loan Parties as of the date of
such extension of 



 53
 









 


credit that the
conditions contained in this Section 4.2 (a) and (b) have been
satisfied on and as of the date of the applicable extension of credit.


5.             REPRESENTATIONS AND WARRANTIES


To induce the
Administrative Agent and the Lenders to enter into this Agreement and to make
the Loans and issue or participate in the Letters of Credit, the Loan Parties
hereby jointly and severally represent and warrant to the Administrative Agent
and each Lender that:


5.1.  Financial
Statements.


(a)           The audited consolidated balance
sheet of Parent and its consolidated Subsidiaries, as at December 31, 2005 and
the related consolidated statements of income and of cash flows for the fiscal
year ended on such date, reported on and accompanied by unqualified reports
from PricewaterhouseCoopers LLP or another independent certified public
accounting firm of nationally recognized standing, present fairly in all
material respects the consolidated financial condition of Parent and its
consolidated Subsidiaries, as at such date, and the consolidated results of
their operations and their consolidated cash flows for such fiscal year then
ended in accordance with GAAP applied consistently throughout the periods
involved (except as approved by the aforementioned firm of accountants and
disclosed therein).


(b)           The unaudited consolidated balance
sheet of Parent and its consolidated Subsidiaries, as of and for the fiscal
quarters ended June 30, 2006 and September 30, 2006, and the related unaudited
consolidated statements of income and cash flows for such fiscal quarters ended
on such dates, present fairly in all material respects the consolidated
financial condition of Parent and its consolidated Subsidiaries as at such
dates, and the consolidated results of their operations and their consolidated
cash flows for the fiscal quarters then ended in accordance with GAAP applied
consistently throughout the periods involved (except (x) as approved by the
aforementioned firms of accountants and disclosed therein or (y) for normal year-end
audit adjustments and the absence of 
footnotes).


5.2.  Corporate Existence; Compliance with Law.  Each of the Loan Parties and their
Subsidiaries (a) is duly organized, validly existing and in good standing under
the Laws of the jurisdiction of its organization, except to the extent that the
failure of the Subsidiaries (other than the Borrower) to be so organized,
validly existing and in good standing could not, in the aggregate, reasonably
be expected to have a Material Adverse Effect, (b) has the corporate or other
power and authority, and the legal right, to own and operate its Property, to
lease the Property it operates as lessee and to conduct the business in which
it is currently engaged, except to the extent that the failure to have such
power, authority and legal right could not, in the aggregate, reasonably be
expected to have a Material Adverse Effect, (c) is duly qualified as a foreign
corporation and in good standing under the Laws of each jurisdiction where its
ownership, lease or operation of Property or the conduct of its business
requires such qualification, except to the extent failure to so qualify or be
in good standing could not, in the aggregate, reasonably be expected to have a
Material Adverse Effect, and (d) is in compliance with all Requirements of Law,
including, without limitation, with respect to environmental laws, 



 54
 









 


except to the
extent that the failure to comply therewith could not, in the aggregate,
reasonably be expected to have a Material Adverse Effect.


5.3.  Corporate Power; Authorization;
Enforceable Obligations.  Each of the
Loan Parties has the corporate or other power and authority, and the legal
right, to make, deliver and perform the Loan Documents to which it is a party
and, in the case of the Borrower, to borrow hereunder.  Each of the Loan Parties has taken all
necessary corporate or other action to authorize the execution, delivery and
performance of the Loan Documents to which it is a party and, in the case of
the Borrower, to authorize the borrowings on the terms and conditions of this
Agreement.  No consent or authorization
of, filing with, notice to or other act by or in respect of, any Governmental
Authority or any other Person is required in connection with the borrowings
hereunder or the execution, delivery, performance, validity or enforceability
of this Agreement or any of the other Loan Documents, except consents,
authorizations, filings and notices described in Schedule 5.3, which
consents, authorizations, filings and notices have been obtained or made and
are in full force and effect and except to the extent failure to obtain any
consents, authorizations, filings, and notices could not, in the aggregate,
reasonably be expected to have a Material Adverse Effect.  Each Loan Document has been duly executed and
delivered on behalf of each Loan Party that is a party thereto.  This Agreement constitutes, and each other
Loan Document upon execution will constitute, a legal, valid and binding
obligation of each Loan Party that is a party thereto, enforceable against each
such Loan Party in accordance with its terms, except as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar Laws affecting the enforcement of creditors’ rights generally and by
general equitable principles (whether enforcement is sought by proceedings in
equity or at Law).


5.4.  No Legal Bar.  The execution, delivery and performance of
this Agreement and the other Loan Documents, the issuance of Letters of Credit,
the borrowings hereunder and the use of the proceeds thereof will not violate
any Requirement of Law or any Contractual Obligation of the Loan Parties or any
of their Subsidiaries and will not result in, or require, the creation or
imposition of any Lien on any of their respective properties or revenues
pursuant to any Requirement of Law or any such Contractual Obligation, except
to the extent such violation or Lien could not, in the aggregate, reasonably be
expected to have a Material Adverse Effect.


5.5.  No Material Litigation.  No litigation, investigation or proceeding of
or before any arbitrator or Governmental Authority is pending or, to the
knowledge of the Loan Parties, threatened by or against the Loan Parties or any
of their Subsidiaries or against any of their respective properties or assets
that (a) purport to affect or pertain to this Agreement or  any other Loan Document or any of the
transactions contemplated hereby or thereby, or (b) could reasonably be
expected to have a Material Adverse Effect.


5.6.  Ownership of Property; Liens.  Each of the Loan Parties and their
Subsidiaries has title in fee simple to, or a valid leasehold interest in, all
its real property, and good title to, or a valid leasehold interest in, all its
other Property, and none of such Property is subject to any Lien except as
permitted by Section 7.3, except to the extent such defects in title
could not, in the aggregate, reasonably be expected to have a Material Adverse
Effect.


 



 55















 


5.7.  Intellectual Property.  Each of the Loan Parties and each of their
Subsidiaries owns, or is licensed to use, all Intellectual Property material to
the conduct of its business as currently conducted.  No material claim has been asserted and is
pending by any Person challenging or questioning the use of any Intellectual
Property or the validity or effectiveness of any Intellectual Property, nor do
the Loan Parties know of any valid basis for any such claim, other than claims
that could not, in the aggregate, reasonably be expected to have a Material
Adverse Effect.  The use of Intellectual
Property by the Loan Parties and their Subsidiaries does not infringe on the
rights of any Person in any material respect, except for infringements that
could not, in the aggregate, reasonably be expected to have a Material Adverse
Effect.


5.8.  Taxes. 
Each of the Loan Parties and their Subsidiaries has filed or caused to
be filed all material Federal, state and other tax returns that are required to
be filed (taking into account any applicable extensions) and has paid all taxes
shown to be due and payable on said returns or on any assessments made against
it or any of its Property and all other material taxes, fees or other charges
imposed on it or any of its Property by any Governmental Authority and, to the
knowledge of the Loan Parties, no tax Lien has been filed, and no claim is
being asserted, with respect to any such tax, fee or other charge, except (i)
those in respect of which the amount or validity are currently being contested
in good faith by appropriate proceedings and with respect to which reserves in
conformity with SAP or GAAP, as applicable, have been provided on the books of
the Loan Parties or their Subsidiaries, as the case may be, and (ii) any amount
the failure of which to pay could not reasonably be expected to result in a
Material Adverse Effect.


5.9.  Federal Regulations.  No part of the proceeds of any Loans will be
used for “purchasing” or “carrying” any “margin stock” within the respective
meanings of each of the quoted terms under Regulation U as now and from time to
time hereafter in effect or for any purpose that violates the provisions of the
Regulations of the Board.  If requested
by any Lender or the Administrative Agent, the Borrower will furnish to the
Administrative Agent and each Lender a statement to the foregoing effect in
conformity with the requirements of FR Form G-3 or FR Form U-1 referred
to in Regulation U.


5.10.  ERISA. 
Except as could not reasonably be expected to result in a Material
Adverse Effect, neither a Reportable Event nor an “accumulated funding
deficiency” (within the meaning of Section 412 of the Code or Section 302
of ERISA) has occurred during the five-year period prior to the date on
which this representation is made or deemed made with respect to any Plan, and
each Plan has complied in all material respects with the applicable provisions
of ERISA and the Code.  No termination of
a Single Employer Plan has occurred, and no Lien in favor of the PBGC or a Plan
has arisen, during such five-year period. 
The present value of all accrued benefits under each Single Employer
Plan (based on those assumptions used to fund such Plans) did not, as of the
last annual valuation date prior to the date on which this representation is
made or deemed made, exceed the value of the assets of such Plan allocable to
such accrued benefits by an amount which could reasonably be expected to result
in a Material Adverse Effect.  Neither
the Loan Parties nor any Commonly Controlled Entity has had a complete or
partial withdrawal from any Multiemployer Plan that has resulted or could
reasonably be expected to result in a Material Adverse Effect.  Except as could not reasonably be expected to
result in a Material Adverse Effect, no such Multiemployer Plan is in
Reorganization or Insolvent.



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5.11.  Investment Company Act; Other Regulations.  The Borrower is not an “investment company”
within the meaning of the Investment Company Act of 1940, as amended.  The Borrower is not subject to regulation
under any Requirement of Law (other than Regulation X of the Board) which
limits its ability to incur Indebtedness hereunder.


5.12.  Use of Proceeds.  The proceeds of the Loans and the Letters of
Credit shall be used for working capital and general corporate purposes of
Parent and its Subsidiaries, including, without limitation, (a) acquisitions
and the issuance of Letters of Credit, (b) refinancings of outstanding
indebtedness, if any, of Parent and its Subsidiaries under the Existing Credit
Agreement (and the Existing Letters of Credit), (c) to provide for the payment
or redemption of obligations in respect of the Fund American Preferred Stock,
and (d) payment of fees and expenses incurred in connection with this
Agreement.


5.13.  Accuracy of Information, etc.  No statement or information contained in any
document, certificate or statement furnished to the Administrative Agent or the
Lenders or any of them, by or on behalf of either of the Loan Parties for use
in connection with the transactions contemplated by this Agreement or the other
Loan Documents, taken as a whole contained, as of the date such statement,
information, document or certificate was so furnished, any untrue statement of
a material fact or omitted to state a material fact necessary in order to make
the statements contained therein not materially misleading in light of the
circumstances under which such statement, information, document or certificate
was made or furnished.  The projections
and pro forma financial information contained in the materials referenced above
were prepared in good faith based on assumptions believed by management of the
Loan Parties to be reasonable at the time made, it being recognized by the
Lenders that such financial information as it relates to future events is not
to be viewed as fact and that actual results during the period or periods
covered by such financial information may differ from the projected results set
forth therein by a material amount.


5.14.  Insurance Regulatory Matters.  No License of any Insurance Subsidiary, the
loss of which could reasonably be expected to have a Material Adverse Effect,
is the subject of a proceeding for suspension or revocation.  To the knowledge of the Loan Parties, there
is no sustainable basis for such suspension or revocation, and no such
suspension or revocation has been threatened by any Governmental Authority.


5.15.  Indebtedness and Liens.  As of the Closing Date, (i) no Subsidiary
(other than the Borrower) of either of the Loan Parties had outstanding any
Indebtedness that was created, incurred or assumed after September 30,  2006,  except
Indebtedness that would have been permitted by Section 7.2 (without
giving effect to the Indebtedness permitted by Section 7.2(a)) if
created, incurred or assumed by such Subsidiary on the Closing Date and (ii)
there does not exist (a) any Lien that was created, incurred or assumed after
September 30,  2006, upon any stock
or Indebtedness of any Subsidiary to secure any Debt of any Loan Party or any
of their Subsidiaries or any other Person (other than the obligations
hereunder) or (b) any Lien that was created, incurred or assumed after
September 30, 2006, upon any other Property, to secure any Debt of any Loan
Party or any of their Subsidiaries or any other Person (other than the obligations
hereunder), except, in the case of (a) or (b), Liens that would have been
permitted by Section 7.3 hereof (without giving effect to the Liens that
would have been permitted by Section 7.3(i)(x)) if so created, incurred
or assumed on the Closing Date.



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5.16.  Taxpayer
Identification Number.  As of
the date hereof, each Loan Party’s true and correct U.S. taxpayer
identification number is set forth on Schedule 10.02.


6.             AFFIRMATIVE COVENANTS


The
Loan Parties hereby jointly and severally agree that, from and after the
Closing Date and so long as, the Commitments remain in effect, any Letter of
Credit remains outstanding, there exists any unpaid Reimbursement Obligations
or any principal or interest on any Loan or any fee payable hereunder is owing
to any Lender or the Administrative Agent hereunder, each of the Loan Parties
shall and shall cause each of their Subsidiaries to:


6.1.  Financial Statements.  Furnish to the Administrative Agent (either
electronically or with sufficient copies for distribution by the Administrative
Agent to each Lender):


(a)           (i) not later than the date required
to be filed pursuant to the Act of 1934 (after giving effect to any extension
permitted or granted by the SEC), but in any event not later than 95 days after
the end of each fiscal year of Parent ending subsequent to the Closing Date, a
copy of the audited consolidated balance sheet of Parent and its consolidated
Subsidiaries as at the end of such fiscal year, and the related audited
consolidated statements of income and of cash flows for such fiscal year,
setting forth in each case in comparative form the figures as of the end of and
for the previous fiscal year, accompanied by an opinion by
PricewaterhouseCoopers LLP, or other independent certified public accounting firm
of nationally recognized standing, which report shall be prepared in accordance
with generally accepted auditing standards and applicable securities laws and
shall not be subject to a “going concern” or like qualification or exception,
or qualification as to the scope of the audit (for purposes hereof, delivery of
Parent’s Annual Report on Form 10-K (which shall be deemed delivered on the
date when such document is posted on the SEC’s website at www.sec.gov or any
replacement website) will be sufficient in lieu of delivery of such financial
statements); and (ii) not later than the date required to be filed pursuant to
the Act of 1934 (after giving effect to any extension permitted or granted by
the SEC), but in any event not later than 60 days after the end of each of the
first three fiscal quarters of each fiscal year of Parent ending subsequent to
the Closing Date, a copy of the unaudited consolidated balance sheet of Parent
and its consolidated Subsidiaries as at the end of such fiscal quarter and the
related unaudited consolidated statements of income and of cash flows for such
fiscal quarter and the portion of the fiscal year through the end of such
fiscal quarter, setting forth in each case in comparative form the figures as
of the end of and for the corresponding period in the previous year, certified
by a Responsible Officer on behalf of Parent as being fairly stated in all
material respects in accordance with GAAP (subject to normal year-end
audit adjustments and the absence of footnotes) (for purposes hereof, delivery
of Parent’s Quarterly Report on Form 10-Q (which shall be deemed delivered on
the date when such document is posted on the SEC’s website at www.sec.gov or
any replacement website) will be sufficient in lieu of delivery of such
financial statements and certifications); all such financial statements,
together with notes to such financial statements, to fairly present in all
material 



 58
 









 


respects the financial condition and income and cash
flows of the subject thereof as at the dates and for the periods covered
thereby in accordance with GAAP applied consistently throughout the periods
reflected therein and with prior periods (except (x) as approved by such
accountants or officer, as the case may be, and disclosed therein or (y) in the
case of unaudited financial statements, subject to normal year-end adjustments
and the absence of footnotes);


(b)           not later than the date required by
Law to be prepared (or such later date as may be allowed by the applicable
Governmental Authority), but in any event not later than 95 days after the end
of each fiscal year of (i) OneBeacon Insurance Group, copies of the unaudited
combined Annual Statement of OneBeacon Insurance Group, certified by a
Responsible Officer on behalf of Parent, and (ii) a Material Insurance
Subsidiary (as of the date of delivery pursuant hereto), copies of the
unaudited Annual Statement of such Material Insurance Subsidiary, certified by
a Responsible Officer on behalf of such Material Insurance Subsidiary; all such
statements to be prepared in accordance with SAP consistently applied
throughout the periods reflected therein and, if required by the applicable
Governmental Authority, audited and certified by independent certified public
accounting firm of recognized national standing (it being understood that
delivery of audited statements shall be made within 10 days following the
delivery of such statements to the applicable Governmental Authority);


(c)           not later than the date required by
Law to be prepared (or such later date as may be allowed by the applicable
Governmental Authority), but in any event not later than 70 days after the end
of each of the first three fiscal quarters of each fiscal year of each Material
Insurance Subsidiary (as of the date delivery of such Quarterly Statements is
required), copies of the Quarterly Statement of such Material Insurance
Subsidiary for such fiscal quarter, all such statements to be prepared in
accordance with SAP consistently applied throughout the period reflected
herein;


(d)           within 15 days after being delivered
to any Material Insurance Subsidiary subsequent to the Closing Date, any final
Report on Examination issued by the applicable Department or the NAIC that
results in material adjustments to the financial statements referred to in paragraphs
(b) or (c) above;


(e)           to the extent such a statement is
required by Law to be prepared, within 10 days following the delivery to the
applicable Department, a copy of each “Statement of Actuarial Opinion” and “Management
Discussion and Analysis” for a Material Insurance Subsidiary which is provided
to the applicable Department as to the adequacy of loss reserves of such
Material Insurance Subsidiary, such opinion to be in the format prescribed by
the insurance code of the state of domicile of such Material Insurance
Subsidiary; and


(f)            promptly after Parent’s receipt
thereof, subject to any restrictions imposed by such independent accountants,
copies of any management letters submitted to the board of directors (or the
audit committee of the board of 



 59
 









 


directors) of Parent by independent accountants in
connection with the annual audit of Parent or any of its Subsidiaries.


6.2.  Certificates; Other Information.  Furnish to the Administrative Agent (either
electronically or with sufficient copies for distribution by the Administrative
Agent to each Lender) or, in the case of clause (d), to the relevant
Lender:


(a)           concurrently with the delivery of the
audited financial statements referred to in Section 6.1(a)(i), a
certificate of the independent certified public accounting firm reporting on
such financial statements stating that in making the examination necessary
therefor no knowledge was obtained of any Default or Event of Default (it being
understood that (i) such certificate shall only be required if delivery by such
independent certified public accounting firm of such a certificate is not
prohibited by its policies and (ii) any such certificate may be limited in
scope and qualified in accordance with customary practices of the accounting
profession), except as specified in such certificate;


(b)           not later than the deadline for the
delivery of any financial statements pursuant to Section 6.1(a), (i) a
certificate of a Responsible Officer of Parent stating that such Responsible
Officer has obtained no knowledge of any continuing Default or Event of Default
except as specified in such certificate and (ii) a Compliance Certificate
containing all information and calculations necessary for determining
compliance by Parent with Section 7.1 as of the last day of the fiscal
quarter or fiscal year of Parent.


(c)           within 10 days after the same are
filed with the SEC (unless posted on the SEC’s website at www.sec.gov or any
replacement website), all reports and filings on Forms 10-K, 10-Q and 8-K that
the Loan Parties may make to, or file with, the SEC, including any request of
an extension of time for the filing of any such reports; and


(d)           promptly, such additional financial
and other information as the Administrative Agent or any Lender may from time
to time reasonably request.


(e)           The Loan Parties hereby acknowledge
that (a) unless otherwise directed by a Loan Party, the Administrative Agent
and/or the Arrangers will make available to the Lenders and the Issuing Bank
materials and/or information provided by or on behalf of the Loan Parties
hereunder (collectively, “Borrower Materials”) by posting the Borrower
Materials on IntraLinks or another similar electronic system (the “Platform”),
subject to confidentiality undertakings reasonably acceptable to the Loan
Parties and the Arrangers, and (b) certain of the Lenders may be “public-side”
Lenders (i.e., Lenders that do
not wish to receive material non-public information with respect to the Loan
Parties or their securities) (each, a “Public Lender”).  Each of the Loan Parties hereby agrees that
(w) all Borrower Materials that are to be made available to Public Lenders
shall be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall
mean that the word “PUBLIC” shall appear prominently on the first page thereof;
(x) by marking Borrower Materials “PUBLIC,” the Loan 



 60
 









 


Parties shall be deemed to have authorized the
Administrative Agent, the Arrangers, the Issuing Bank and the Lenders to treat
such Borrower Materials as either publicly available information or not material
information (although it may be sensitive and proprietary) with respect to the
Loan Parties or their securities for purposes of United States Federal and
state securities laws; (y) all Borrower Materials marked “PUBLIC” are permitted
to be made available through a portion of the Platform designated “Public
Investor;” and (z) the Administrative Agent and the Arrangers shall be entitled
to treat any Borrower Materials that are not marked “PUBLIC” as being suitable
only for posting on a portion of the Platform not designated “Public Investor.”  Notwithstanding any of the foregoing, if any
Loan Party also delivers any materials and/or information pursuant to this Section
6.2(e) in paper format to the Administrative Agent, such paper materials
shall be deemed to be Borrower Materials for all purposes.  Nothing in this Section 6.2(e) shall
limit the obligations of the Administrative Agent and the Lenders under Section
10.16.


6.3.  Payment of Obligations.  Pay, discharge or otherwise satisfy at or
before maturity or before they become delinquent, as the case may be, all its
material obligations of whatever nature (other than Indebtedness), except where
the amount or validity thereof is currently being contested in good faith by
appropriate proceedings and reserves in conformity with GAAP with respect
thereto have been provided on the books of the Loan Parties or their
Subsidiaries, as the case may be; provided, that the Loan Parties may,
in the ordinary course of business, extend payments on those payables if beneficial
to the operation of their businesses.


6.4.  Conduct of Business and Maintenance of
Existence, etc.  (a)(i) With respect
to each Subsidiary of Parent, preserve, renew and keep in full force and effect
its corporate existence and (ii) with respect to Parent and each of its
Subsidiaries, take all reasonable action to maintain all licenses, permits,
rights, privileges and franchises necessary or desirable in the normal conduct
of its business, except, in each case, as otherwise would not be a Fundamental Change
and except, in the case of clause (i) above and clause (ii)
above, to the extent that failure to do so could not reasonably be expected to
have a Material Adverse Effect; and (b) comply with all Contractual Obligations
(other than in respect of Indebtedness) and Requirements of Law, except to the
extent that failure to comply therewith could not, in the aggregate, reasonably
be expected to have a Material Adverse Effect.


6.5.  Maintenance of Property; Insurance.  (a) 
Keep all Property and systems useful and necessary in its business in
good working order and condition, ordinary wear and tear excepted and
(b) maintain with financially sound and reputable insurance companies
(other than with Parent or its Subsidiaries) insurance on all its Property in at
least such amounts and against at least such risks (but including in any event
public liability, product liability and business interruption) as are usually
insured against in the same general area by companies engaged in the same or a
similar business (it being understood that, to the extent consistent with
prudent business practices of Persons carrying on a similar business in a
similar location, a program of self-insurance for first and other loss layers
may be utilized).


6.6.  Inspection of Property; Books and Records;
Discussions.  (a)  Keep proper books of records and account in
which full, true and correct entries in conformity with GAAP (or SAP as
applicable) and all Requirements of Law shall be made of all material dealings
and 



 61
 









 


transactions in
relation to its business and activities and (b) upon reasonable prior notice,
permit representatives of the Administrative Agent (who may be accompanied by
representatives of other Lenders) and, during the continuance of an Event of
Default, any Lender to (x) visit and inspect any of its properties, (y) during
the continuance of an Event of Default, conduct reasonable examinations of
(and, with the consent of the Loan Parties, such consent not to be unreasonably
withheld, make abstracts from) any of its books and records at any reasonable
time and as often as may reasonably be requested and (z) discuss the business,
operations, properties and financial and other condition of the Loan Parties
with officers and employees of the Loan Parties.  It is understood that (i) any information
obtained by the Administrative Agent or any Lender in any visit or inspection
pursuant to this Section 6.6 shall be subject to the confidentiality
requirements of Section 10.16, (ii) the Loan Parties may impose, with
respect to any Lender or any Affiliate of any Lender reasonably deemed by the
Loan Parties to be engaged significantly in a business which is directly
competitive with any material business of the Loan Parties and their respective
Subsidiaries, reasonable restrictions on access to proprietary information of
the Loan Parties and their respective Subsidiaries and (iii) the Lenders will
coordinate their visits through the Administrative Agent with a view to
preventing the visits provided for by this Section 6.6 from becoming
unreasonably burdensome to the Loan Parties and their Subsidiaries.


6.7.  Notices.  Give notice to the Administrative Agent (it
being agreed that the Administrative Agent shall, upon receipt of such notice,
notify each Lender thereof) of the following within the time periods specified:


(a)           Promptly after any Responsible
Officer of the Borrower obtains knowledge thereof, the occurrence of any
Default or Event of Default;


(b)           Within five days after any
Responsible Officer of the Borrower obtains knowledge thereof, the occurrence
of:


(i)            any default or event of default
under any Contractual Obligation (other than in respect of Indebtedness) of a
Loan Party or any of its Subsidiaries or any litigation, investigation or
proceeding which may exist at any time between a Loan Party or any of its
Subsidiaries and any Governmental Authority, that in either case, if not cured
or if adversely determined, as the case may be, could reasonably be expected to
have a Material Adverse Effect; and


(ii)           (A) any litigation or proceeding
affecting a Loan Party or any of its Subsidiaries (other than claims-related
litigation involving an Insurance Subsidiary) in which (x) the amount involved
(and not covered by insurance) is $50,000,000 or more or (y) in which
injunctive or similar relief is sought that could reasonably be expected to
have a Material Adverse Effect and (B) any claims-related litigation affecting
any Insurance Subsidiary which could reasonably be expected to have a Material
Adverse Effect; and


(c)           As soon as possible and, in any
event, within 30 days after a Responsible Officer of the Borrower obtains
knowledge thereof:  (A) the occurrence of
any Reportable Event with respect to any Plan, a failure to make any required 



 62
 









 


contribution to a Plan, the creation of any Lien in
favor of the PBGC or a Plan or any withdrawal from, or the termination,
Reorganization or Insolvency of, any Multiemployer Plan or (B) the institution
of proceedings or the taking of any other action by the PBGC or a Loan Party or
any Commonly Controlled Entity or any Multiemployer Plan with respect to the
withdrawal from, or the termination, Reorganization or Insolvency of, any Plan.


Each notice pursuant to
this Section 6.7 shall be accompanied by a statement of a Responsible
Officer on behalf of Parent setting forth details of the occurrence or such
default referred to therein and stating what action the Loan Parties or the
relevant Subsidiary proposes to take with respect thereto.


6.8.  Taxes. 
Pay, discharge, or otherwise satisfy before the same shall become
overdue, all taxes, assessments and other governmental charges imposed upon it
and its real estate, sales and activities, or any part thereof, or upon the
income or profits therefrom, other than where failure to pay such taxes could
not reasonably be expected to result in a Material Adverse Effect; provided
that any such tax, assessment, charge, levy or claim need not be paid if the
validity or amount thereof shall currently be contested in good faith by
appropriate proceedings and reserves in conformity with SAP or GAAP, as
applicable, have been provided on the books of the Loan Parties and their
Subsidiaries, as the case may be.


6.9.  Use of Proceeds.  Use the proceeds of the Loans and the Letters
of Credit solely for the purposes set forth in Section 5.12.


6.10.  Further Assurances.  Each of the Loan Parties will, and will cause
each of their Subsidiaries to, cooperate with the Lenders and the
Administrative Agent and execute such further instruments and documents as the
Lenders or the Administrative Agent shall reasonably request to give effect to
the transactions contemplated by this Agreement and the other Loan Documents.


7.             NEGATIVE COVENANTS


The
Loan Parties hereby jointly and severally agree that, from and after the
Closing Date and so long as the Commitments remain in effect, any Letter of
Credit remains outstanding, there exist any unpaid Reimbursement Obligations or
any principal or interest on any Loan or any fee payable hereunder is owing to
any Lender or the Administrative Agent hereunder:


7.1.  Financial Condition Covenants.


(a)           Maintenance of Consolidated Net
Worth.  Parent shall not permit its
Consolidated Net Worth, as of the end of any fiscal quarter, commencing with
the first fiscal quarter ending after the Closing Date, to be less than the sum
of (i) sixty-five percent (65%) of the pro forma Consolidated Net Worth of
Parent as disclosed in the Form S-1 Registration Statement filed in connection
with the IPO, plus (ii) fifty percent (50%) of positive Consolidated Net Income
for each fiscal quarter ending after September 30, 2006.



 63
 









 


(b)           Maintenance of Total Consolidated
Debt to Total Consolidated Capitalization Ratio. Parent shall not permit
its Total Consolidated Debt to Total Consolidated Capitalization Ratio, (i) as
of the end of any fiscal quarter ending after the Closing Date and prior to the
second anniversary of the Closing Date to be greater than thirty-seven and one
half of one percent (37.5%) and (ii) as of the end of any fiscal quarter ending
on or after the second anniversary of the Closing Date to be greater than
thirty-five percent (35%).


7.2.  Limitation on Indebtedness and Issuance of
Preferred Stock.  The Loan Parties
will not permit any of their Subsidiaries (other than the Borrower) to create,
incur or assume or suffer to exist any Indebtedness or issue any preferred
stock, except:


(a)           Indebtedness and preferred stock
outstanding as of the Closing Date and any refinancings, refundings, renewals
or extensions thereof (without any increase in the principal amount thereof,
other than by the amount of any necessary pre-payment premiums, unpaid accrued
interest and other costs of refinancing, or any shortening of the final
maturity of any principal amount thereof to a date prior to the Revolving
Credit Termination Date);


(b)           Indebtedness or preferred stock of
any Insurance Subsidiary incurred or issued in the ordinary course of its
business or in securing insurance-related obligations (that do not constitute
Indebtedness) of such Insurance Subsidiary and letters of credit, bank
guarantees, surety bonds or similar instruments issued for the account of any
Insurance Subsidiary in the ordinary course of its business or in securing
insurance-related obligations (that do not constitute Indebtedness) of such
Insurance Subsidiary;


(c)           Indebtedness in respect of letters of
credit, bank guarantees, surety and appeal bonds, or performance bonds or other
obligations of a like nature arising in the ordinary course of business and not
for capital raising purposes and issued for the account of any Non-Regulated
Operating Subsidiary;


(d)           short-term Indebtedness (i.e. with a
maturity of less than one year when issued, provided that such Indebtedness may
include an option to extend for up to an additional one year period) of any
Insurance Subsidiary incurred to provide short-term liquidity to facilitate
claims payment in the event of catastrophe;


(e)           Indebtedness or preferred stock of a
Subsidiary acquired after the Closing Date or a corporation merged into or
consolidated with a Subsidiary after the Closing Date and Indebtedness assumed
in connection with the acquisition of assets, which Indebtedness, in each case,
exists at the time of such acquisition, merger or consolidation and is not
created in contemplation of such event, as well as any refinancings, refunds,
renewals or extensions of such Indebtedness (without increase in the principal
amount thereof other than by the amount of any necessary pre-payment premiums,
unpaid accrued interest and other costs of refinancing);



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(f)            Indebtedness or preferred stock
owing or issued by a Subsidiary to any other Subsidiary or to any Loan Party;


(g)           Guarantee Obligations made by a
Subsidiary in respect of obligations of another Subsidiary (other than the
Borrower);


(h)           Indebtedness under the Loan Documents;


(i)            other Indebtedness or preferred
stock of Persons, provided that at the time such Indebtedness or
preferred stock is incurred or issued, the aggregate principal amount or
liquidation preference of such Indebtedness or preferred stock when added to
all other Indebtedness and preferred stock incurred or issued pursuant to this clause
(i) and then outstanding, does not exceed 15% of the Consolidated Net Worth
of Parent; provided that, in calculating Indebtedness and preferred
stock incurred pursuant to this clause (i), the Indebtedness and
preferred stock of the Borrower shall be excluded.


7.3.  Limitation on Liens.  The Loan Parties will not, and will not
permit any of their Subsidiaries to, create, incur, assume or suffer to exist
(a) any Lien upon any stock or indebtedness of any Subsidiary, whether owned on
the date of this Agreement or hereafter acquired, to secure any Debt of the
Loan Parties or any of their Subsidiaries or any other person (other than the
obligations hereunder) or (b) any Lien upon any other Property of the Loan
Parties or their respective Subsidiaries, whether owned or leased on the date
of this Agreement, or thereafter acquired, to secure any Debt of the Loan
Parties or any of their Subsidiaries or any other person (other than the
obligations hereunder), except:


(i)            (x) any Lien existing on the date of
this Agreement or (y) any Lien upon stock or Indebtedness or other Property of
any Person existing at the time such Person becomes a Subsidiary or existing
upon stock or Indebtedness of a Subsidiary or any other Property at the time of
acquisition of such stock or Indebtedness or other Property (provided
that such Lien was not created in connection with the acquisition of such
Person or such Property), and any extension, renewal or replacement (or
successive extensions, renewals or replacements) in whole or in part of any
such Lien in clauses (x) or (y) above; provided, however,
that the principal amount of Debt secured by such Lien shall not exceed the
principal amount of Debt so secured at the time of such extension, renewal or
replacement; and provided,  further, that such Lien shall be
limited to all or such part of the stock or Indebtedness or other Property
which secured the Lien so extended, renewed or replaced;


(ii)           any Permitted Liens; and


(iii)          any Lien upon any Property if the
aggregate amount of all Debt then outstanding secured by such Lien and all
other Liens permitted pursuant to this clause (iii) does not exceed 10%
of the total consolidated stockholders’ equity (including preferred stock) of
Parent as shown on the audited consolidated balance sheet contained in the
latest annual report to stockholders of Parent; 



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provided that Debt secured by Liens
permitted by clauses (i) and (ii) shall not be included in the
amount of such secured Debt.


7.4.  Limitation on Changes in Fiscal Periods.  Neither of the Loan Parties shall permit its
fiscal year to end on a day other than December 31 or change its method of
determining fiscal quarters.


7.5.  Limitation on Lines of Business.  Neither of the Loan Parties shall engage to
any extent that is material for such Loan Party and its Subsidiaries, taken as
a whole, in any business, either directly or through any Subsidiary, other than
a Principal Business.


8.             EVENTS OF DEFAULT


8.1.  Events
of Default.  If any of the following
events shall occur and be continuing:


(a)           The Borrower shall fail to pay any
principal of any Loan made to the Borrower or Reimbursement Obligation owing by
the Borrower when due in accordance with the terms hereof; or the Borrower
shall fail to pay any interest on any Loan made to the Borrower or
Reimbursement Obligation owing to the Borrower, or any other amount payable by
the Borrower hereunder or under any other Loan Document, within three Business
Days after any such interest or other amount becomes due in accordance with the
terms hereof; or


(b)           Either of the Loan Parties shall
default in the observance or performance of any agreement contained in Section
6.7(a) or Section 7; or


(c)           (i) The Loan Parties or any of their
Material Insurance Subsidiaries shall voluntarily commence any case, proceeding
or other action (A) under any Debtor Relief Law, (B) seeking appointment of a
receiver, trustee, custodian, conservator or other similar official for it or
for all or any substantial part of its assets, or the Loan Parties or any of
their Material Insurance Subsidiaries shall make a general assignment for the
benefit of its creditors; or (ii) there shall be commenced against the Loan
Parties or any of their Material Insurance Subsidiaries any case, proceeding or
other action under any Debtor Relief Law that (A) results in the entry of an
order for relief or any such adjudication or appointment or (B) remains
undismissed, undischarged or unbonded for a period of 60 days; or (iii) the
Loan Parties or any of their Material Insurance Subsidiaries shall take any
corporate action to authorize or effect any of the acts set forth in clause
(i), or (ii), above; or (iv) the Loan Parties or any of their
Material Insurance Subsidiaries shall generally not, or shall be unable to, or
shall admit in writing its inability to, pay its debts as they become due; or


(d)           A Change of Control; or


(e)           A Fundamental Change; or


 



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(f)            (i) White Mountains shall (x)
default in making any payment of any principal of any Indebtedness (including,
without limitation, any Guarantee Obligation) on the scheduled or original due
date with respect thereto (after giving effect to any applicable grace
periods); or (y) default in making any payment of any interest on any such
Indebtedness beyond the period of grace, if any, provided in the instrument or
agreement under which such Indebtedness was created; or (z) default in the
observance or performance of any other agreement or condition relating to any
such Indebtedness or contained in any instrument or agreement evidencing,
securing or relating thereto (after giving effect to any applicable notice
requirements and grace periods), and (ii) the effect of such default by White
Mountains (excluding the Loans and Reimbursement Obligations) is to cause
Indebtedness of the Borrower, or to permit the holder or beneficiary (or a
trustee or agent on behalf of such holder or beneficiary) of Indebtedness of the
Borrower (excluding the Loans and Reimbursement Obligations) to cause such
Indebtedness of the Borrower (in each case after giving effect to any
applicable notice requirements and grace periods in respect of such
Indebtedness of the Borrower), to become due prior to its stated maturity or to
become subject to a mandatory offer to purchase by the obligor thereunder as a
result of the occurrence of such default by White Mountains, provided,
that the events described in this paragraph (d) shall not at any time
constitute an Event of Default unless, at such time, the events described in clause
(ii) shall have occurred and be continuing with respect to Indebtedness of
the Borrower (excluding the Loans and Reimbursement Obligations) the
outstanding principal amount of which exceeds in the aggregate $25,000,000;


(g)           Any representation or warranty made
or deemed made by either of the Loan Parties herein or in any other Loan
Document or that is contained in any certificate, document or financial or
other statement furnished by it at any time under or in connection with this
Agreement or any such other Loan Document shall prove to have been inaccurate
in any material respect on or as of the date made or deemed made or furnished;
or


(h)           Either of the Loan Parties shall
default in the observance or performance of any other agreement, covenant, term
or condition contained in this Agreement or any other Loan Document (not
specified in Sections 8.1(a), 8.1(b) or 8.1(g); or


(i)            The Loan Parties or any of their
Subsidiaries shall (i) default in making any payment of any principal of any
Indebtedness (including, without limitation, any Guarantee Obligation, but
excluding the Loans and Reimbursement Obligations) on the scheduled or original
due date with respect thereto (after giving effect to any applicable grace
periods); or (ii) default in making any payment of any interest on any such
Indebtedness beyond the period of grace, if any, provided in the instrument or
agreement under which such Indebtedness was created; or (iii) default in the
observance or performance of any other agreement or condition relating to any
such Indebtedness or contained in any instrument or agreement evidencing,
securing or relating thereto, the effect of which default is to cause, or to
permit the holder or beneficiary of such Indebtedness (or a trustee or agent on
behalf of such holder or 



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beneficiary) to cause, with the giving of notice if
required, such Indebtedness to become due prior to its stated maturity or to
become subject to a mandatory offer to purchase by the obligor thereunder as a
result of the occurrence of such default thereunder or (in the case of any such
Indebtedness constituting a Guarantee Obligation) to become payable; provided,
that a default described in clause (i), (ii) or (iii) of
this paragraph (i) shall not at any time constitute an Event of Default
unless, at such time, one or more defaults of the type described in clauses
(i), (ii) and (iii) of this paragraph (i) shall have
occurred and be continuing with respect to Indebtedness the outstanding
principal amount of which exceeds in the aggregate $25,000,000; or


(j)            (i) Any person shall engage in
any “prohibited transaction” (as defined in Section 406 of ERISA or Section
4975 of the Code) involving any Plan, (ii) any “accumulated funding deficiency”
(as defined in Section 302 of ERISA), whether or not waived, shall exist with
respect to any Plan or any Lien in favor of the PBGC or a Plan shall arise on
the assets of a Loan Party or any Commonly Controlled Entity, (iii) a Reportable
Event shall occur with respect to, or proceedings shall commence to have a
trustee appointed, or a trustee shall be appointed, to administer or to
terminate, any Single Employer Plan, which Reportable Event or commencement of
proceedings or appointment of a trustee is, in the reasonable opinion of the
Majority Lenders, likely to result in the termination of such Plan for purposes
of Title IV of ERISA, (iv) any Single Employer Plan shall terminate for
purposes of Title IV of ERISA or, (v) any Loan Party or any Commonly Controlled
Entity shall, or in the reasonable opinion of the Majority Lenders is likely
to, incur any liability in connection with a withdrawal from, or the Insolvency
or Reorganization of, a Multiemployer Plan and in each case in clauses (i)
through (v) above, such event or condition, together with all other such
events or conditions for which liability to a Loan Party is reasonably expected
to occur, if any, could, in the reasonable judgment of the Majority Lenders,
reasonably be expected to have a Material Adverse Effect; or


(k)           One or more judgments or decrees
shall be entered against the Loan Parties or any of their Subsidiaries
involving for the Loan Parties and their Subsidiaries taken as a whole a
liability (to the extent not paid or fully covered by insurance above
applicable deductions) of $25,000,000 or more, and all such judgments or
decrees shall not have been vacated, discharged, stayed or bonded pending
appeal within 45 days from the entry thereof; or


(l)            The guarantee, set forth in Section
2.21 herein, shall cease, for any reason (other than as provided in Section
10.17) to be in full force and effect or either of the Loan Parties or any
Affiliate of either of the Loan Parties shall so assert in writing; or


(m)          Any License of any Insurance
Subsidiary (i) shall be revoked by the Governmental Authority which issued
such License, or any action (administrative or judicial) to revoke such License
shall have been commenced against such Insurance Subsidiary and shall not have
been dismissed within thirty days after the commencement thereof,
(ii) shall be suspended by such Governmental 



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Authority for a period in excess of thirty days or
(iii) shall not be reissued or renewed by such Governmental Authority upon
the expiration thereof following application for such reissuance or renewal of
such Insurance Subsidiary, which, in the case of each of clauses (i), (ii)
and (iii) above, could reasonably be expected to have a Material Adverse
Effect.


Notwithstanding the foregoing, in the case of each of
paragraphs (g) through (m) of this Section 8.1, such event shall not constitute
an Event of Default unless such event continues unremedied for a period of 30
days after the Borrower shall have received written notice of such event from
the Administrative Agent.


8.2.  Remedies
Upon Event of Default.  If any Event
of Default specified in Section 8.1 occurs and is continuing, then, and
in any such event, (a) if such event is an Event of Default specified in clause
(i) or (ii) of Section 8.1(c) above with respect to the
Borrower, automatically the commitment of each Lender to make Loans and any
obligation of the Issuing Lender to make L/C Credit Extensions shall
immediately terminate and the Loans hereunder (with accrued interest thereon)
and all other amounts owing under this Agreement and the other Loan Documents
(including, without limitation, all amounts of L/C Obligations, whether or not
the beneficiaries of the then outstanding Letters of Credit shall have
presented the documents required thereunder) shall immediately become due and
payable, and (b) if such event is any other Event of Default specified in Section
8.1, either or both of the following actions may be taken: (i) with the
consent of the Majority Lenders, the Administrative Agent may, or upon the
request of the Majority Lenders, the Administrative Agent shall, by notice to
the Borrower declare the Revolving Credit Commitments and the obligation of the
Issuing Lender to issue Letters of Credit to be terminated forthwith, whereupon
the Revolving Credit Commitments and the L/C Commitment shall immediately
terminate; and (ii) with the consent of the Majority Lenders, the
Administrative Agent may, or upon the request of the Majority Lenders, the
Administrative Agent shall, by notice to the Borrower, declare the Loans
hereunder (with accrued interest thereon) and all other amounts owing under
this Agreement and the other Loan Documents (including, without limitation, all
amounts of L/C Obligations, whether or not the beneficiaries of the then outstanding
Letters of Credit shall have presented the documents required thereunder) to be
due and payable forthwith, whereupon the same shall immediately become due and
payable.  In the case of any Letter of
Credit issued for the account of the Borrower with respect to which presentment
for honor shall not have occurred at the time of an acceleration pursuant to
this paragraph, the Borrower shall at such time Cash Collateralize such L/C
Obligations in an amount equal to the aggregate then undrawn and unexpired
amount of such Letters of Credit.  Such
cash collateral shall be applied by the Administrative Agent to the payment of
drafts drawn under such Letters of Credit, and the unused portion thereof after
all such Letters of Credit shall have expired or been fully drawn upon, if any,
shall be applied to repay other obligations of the Loan Parties hereunder and
under the other Loan Documents.  After
(a) all such Letters of Credit shall have expired or been fully drawn upon, all
Reimbursement Obligations shall have been satisfied and all other obligations
of the Loan Parties hereunder and under the other Loan Documents shall have
been paid in full or (b) all Defaults and Events of Default hereunder and under
the other Loan Document shall have been cured or waived, the balance, if any,
in such cash collateral account shall be returned to the applicable Loan Party
(or such other Person as may be lawfully entitled thereto).



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9.             THE ADMINISTRATIVE AGENT


9.1.  Appointment.  (a) 
Each Lender hereby irrevocably appoints, designates and authorizes the
Administrative Agent to take such action on its behalf under the provisions of
this Agreement and each other Loan Document and to exercise such powers and
perform such duties as are expressly delegated to it by the terms of this
Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto. 
Notwithstanding any provision to the contrary contained elsewhere herein
or in any other Loan Document, the Administrative Agent shall not have any
duties or responsibilities, except those expressly set forth herein, nor shall
the Administrative Agent have or be deemed to have any fiduciary relationship
with any Lender or participant, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the
Administrative Agent.  Without limiting
the generality of the foregoing sentence, the use of the term “agent” herein
and in the other Loan Documents with reference to the Administrative Agent is
not intended to connote any fiduciary or other implied (or express) obligations
arising under agency doctrine of any applicable Law.  Instead, such term is used merely as a matter
of market custom, and is intended to create or reflect only an administrative
relationship between independent contracting parties.


(b)           The Issuing Lender shall act on
behalf of the Lenders with respect to any Letters of Credit issued by it and
the documents associated therewith, and the Issuing Lender shall have all of
the benefits and immunities (i) provided to the Administrative Agent in
this Section 9 with respect to any acts taken or omissions suffered by
the Issuing Lender in connection with Letters of Credit issued by it or
proposed to be issued by it and the Applications and agreements for letters of
credit pertaining to such Letters of Credit as fully as if the term “Administrative
Agent” as used in this Section 9 and in the definition of “Agent-Related
Person” included the Issuing Lender with respect to such acts or omissions, and
(ii) as additionally provided herein with respect to the Issuing Lender; provided
that nothing in this Agreement shall be construed to excuse the Issuing Lender
from any liability to the Borrower for damages caused by the gross negligence
or willful misconduct of the Issuing Lender or any Agent-Related Person.


9.2.  Delegation of Duties.  The Administrative Agent may execute any of
its duties under this Agreement or any other Loan Document by or through
agents, employees or attorneys-in-fact and shall be entitled to advice of
counsel and other consultants or experts concerning all matters pertaining to
such duties.  The Administrative Agent
shall not be responsible for the negligence or misconduct of any agent or
attorney-in-fact that it selects in the absence of gross negligence or willful
misconduct.


9.3.  Liability of Administrative Agent.  No Agent-Related Person shall (a) be liable
for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (except for its own gross negligence or willful misconduct
in connection with its duties expressly set forth herein), or (b) be
responsible in any manner to any Lender or participant for any recital,
statement, representation or warranty made by either of the Loan Parties or any
officer thereof, contained herein or in any other Loan Document, or in any
certificate, report, statement or other 



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document referred
to or provided for in, or received by the Administrative Agent under or in
connection with, this Agreement or any other Loan Document, or the validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document, or for any failure of either of the Loan Parties or
any other party to any Loan Document to perform its obligations hereunder or
thereunder.  No Agent-Related Person
shall be under any obligation to any Lender or participant to ascertain or to
inquire as to the observance or performance of any of the agreements contained
in, or conditions of, this Agreement or any other Loan Document, or to inspect
the properties, books or records of the Loan Parties or any Affiliate thereof.


9.4.  Reliance by Administrative Agent.  (a) 
The Administrative Agent shall be entitled to rely, and shall be fully
protected in relying, upon any writing, communication, signature, resolution,
representation, notice, consent, certificate, affidavit, letter, telegram, facsimile,
telex or telephone message, electronic mail message, statement or other
document or conversation believed by it to be genuine and correct and to have
been signed, sent or made by the proper Person or Persons, and upon advice and
statements of legal counsel (including counsel to the Loan Parties),
independent accountants and other experts selected by the Administrative
Agent.  The Administrative Agent may deem
and treat the payee of any Note as the owner thereof for all purposes unless
such Note shall have been transferred in accordance with Section 10.7
and all actions required by such Section 10.7 in connection with such
transfer shall have been taken.  The
Administrative Agent shall be fully justified in failing or refusing to take
any action under any Loan Document unless it shall first receive such advice or
concurrence of the Majority Lenders (or, if so specified by this Agreement, all
Lenders) as it deems appropriate and, if it so requests, it shall first be
indemnified to its satisfaction by the Lenders against any and all liability
and expense which may be incurred by it by reason of taking or continuing to
take any such action.  The Administrative
Agent shall in all cases be fully protected in acting, or in refraining from
acting, under this Agreement or any other Loan Document in accordance with a
request or consent of the Majority Lenders (or such greater number of Lenders
as may be expressly required hereby in any instance) and such request and any
action taken or failure to act pursuant thereto shall be binding upon all the
Lenders; provided that the Administrative Agent shall not be required to
take any action that, in its opinion or the opinion of its counsel, may expose
the Administrative Agent to liability or that is contrary to any Loan Document
or applicable Law.


(b)           For purposes of determining
compliance with the conditions specified in Section 4.1, each Lender
that has signed this Agreement 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 a
Lender unless the Administrative Agent shall have received notice from such
Lender prior to the proposed Closing Date specifying its objection thereto.


9.5.  Notice of Default.  The Administrative Agent shall not be deemed
to have knowledge or notice of the occurrence of any Default unless the
Administrative Agent shall have received written notice from a Lender or a Loan
Party referring to this Agreement, describing such Default and stating that
such notice is a “notice of default.” The Administrative Agent will notify the
Lenders of its receipt of any such notice. 
The Administrative Agent shall take such action with respect to such
Default as may be directed by the Majority Lenders in accordance with Section
8.2; provided, however, that unless and until the Administrative Agent has
received 



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any such
direction, the Administrative Agent may (but shall not be obligated to) take
such action, or refrain from taking such action, with respect to such Default
as it shall deem advisable or in the best interest of the Lenders.


9.6.  Credit Decision; Disclosure of Information
by Administrative Agent.  Each Lender
acknowledges that no Agent-Related Person has made any representation or
warranty to it, and that no act by the Administrative Agent hereafter taken,
including any consent to and acceptance of any assignment or review of the
affairs of the Loan Parties or any Affiliate thereof, shall be deemed to constitute
any representation or warranty by any Agent-Related Person to any Lender as to
any matter, including whether Agent-Related Persons have disclosed material
information in their possession.  Each
Lender represents to the Administrative Agent that it has, independently and
without reliance upon any Agent-Related Person and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, prospects, operations, property, financial and
other condition and creditworthiness of the Loan Parties and their
Subsidiaries, and all applicable bank or other regulatory Laws relating to the
transactions contemplated hereby, and made its own decision to enter into this
Agreement and to extend credit to the Borrower hereunder.  Each Lender also represents that it will,
independently and without reliance upon any Agent-Related Person and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement and the other Loan Documents, and to
make such investigations as it deems necessary to inform itself as to the
business, prospects, operations, property, financial and other condition and
creditworthiness of the Loan Parties. 
Except for notices, reports and other documents expressly required to be
furnished to the Lenders by the Administrative Agent herein, the Administrative
Agent shall not have any duty or responsibility to provide any Lender with any
credit or other information concerning the business, prospects, operations,
property, financial and other condition or creditworthiness of any of the Loan
Parties or any of their Affiliates which may come into the possession of any
Agent-Related Person.


9.7.  Indemnification of Administrative Agent.  Whether or not the transactions contemplated
hereby are consummated, the Lenders shall indemnify upon demand each
Agent-Related Person (to the extent not reimbursed by or on behalf of the
Borrower and without limiting the obligation of the Borrower), pro rata, and
hold harmless each Agent-Related Person from and against any and all
Indemnified Liabilities incurred by it; provided, however, that
no Lender shall be liable for the payment to any Agent-Related Person of any
portion of such Indemnified Liabilities to the extent determined in a final,
nonappealable judgment by a court of competent jurisdiction to have resulted
from such Agent-Related Person’s own gross negligence or willful misconduct, provided,
however, that no action taken in accordance with the directions of the
Majority Lenders (or such greater percentage of Lenders as may be required
hereunder) shall be deemed to constitute gross negligence or willful misconduct
for purposes of this Section 9.7. 
Without limitation of the foregoing, each Lender shall reimburse the
Administrative Agent upon demand for its ratable share of any costs or
out-of-pocket expenses (including Attorney Costs) incurred by the Administrative
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, any other Loan Document, or any
document contemplated by or referred to herein, to the extent that the
Administrative Agent is not 



 72
 









 


reimbursed for
such expenses by or on behalf of the Borrower. 
The undertaking in this Section 9.7 shall survive termination
of the Total Revolving Credit Commitments, the payment of all other obligations
and the resignation of the Administrative Agent.


9.8.  Administrative Agent in its Individual
Capacity.  Bank of America, N.A. and
its Affiliates may make loans to, issue letters of credit for the account of,
accept deposits from, acquire equity interests in and generally engage in any
kind of banking, trust, financial advisory, underwriting or other business with
the Loan Parties and their respective Affiliates as though Bank of America,
N.A. were not the Administrative Agent or the Issuing Lender hereunder and
without notice to or consent of the Lenders. 
The Lenders acknowledge that, pursuant to such activities, Bank of
America, N.A. or its Affiliates may receive information regarding the Loan
Parties or their Affiliates (including information that may be subject to
confidentiality obligations in favor of the Loan Parties or such Affiliate) and
acknowledge that the Administrative Agent shall be under no obligation to provide
such information to them.  With respect
to its Loans, Bank of America, N.A. shall have the same rights and powers under
this Agreement as any other Lender and may exercise such rights and powers as
though it were not the Administrative Agent or the Issuing Lender, and the
terms “Lender” and “Lenders” include Bank of America, N.A. in its individual
capacity.


9.9.  Successor Administrative Agent.  The Administrative Agent may resign as
Administrative Agent upon 30 days’ notice to the Lenders and the Borrower; provided
that any such resignation by Bank of America, N.A. shall also constitute its
resignation as Issuing Lender and Swing Line Lender, so long as a successor
Issuing Lender and a successor Swing Line Lender (each consented to by the
Borrower, such consent not to be unreasonably withheld or delayed) is
appointed.  If the Administrative Agent
resigns under this Agreement, the Majority Lenders shall appoint from among the
Lenders a successor administrative agent for the Lenders, which successor
administrative agent shall be consented to by the Borrower at all times other
than during the continuance of a Specified Event of Default (which consent of
the Borrower shall not be unreasonably withheld or delayed).  If no successor administrative agent is
appointed prior to the effective date of the resignation of the Administrative
Agent, the Administrative Agent may appoint, after consulting with the Lenders
and the Borrower, a successor administrative agent from among the Lenders.  Upon the acceptance of its appointment as
successor administrative agent hereunder, the Person acting as such successor
administrative agent shall succeed to all of the rights, powers and duties of
the retiring Administrative Agent, Issuing Lender and Swing Line Lender and the
respective terms “Administrative Agent,” “Issuing Lender” and “Swing Line
Lender” shall mean such successor administrative agent, Letter of Credit issuer
and swing line lender, and the retiring Administrative Agent’s appointment,
powers and duties as Administrative Agent shall be terminated and the retiring
Issuing Lender’s and Swing Line Lender’s rights, powers and duties as such
shall be terminated, without any other or further act or deed on the part of
such retiring Issuing Lender or Swing Line Lender or any other Lender, other
than the obligation of the successor Issuing Lender to issue letters of credit
in substitution for the Letters of Credit, if any, outstanding at the time of
such succession or to make other arrangements satisfactory to the retiring Issuing
Lender to effectively assume the obligations of the retiring Issuing Lender
with respect to such Letters of Credit. 
After any retiring Administrative Agent’s resignation hereunder as
Administrative Agent, the provisions of this Section 9 and Sections 10.5
and 10.6 shall inure to its benefit as to any actions taken or omitted
to be taken by it while it was Administrative Agent under this 



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Agreement.  If no successor administrative agent has
accepted appointment as Administrative Agent by the date which is 30 days
following a retiring Administrative Agent’s notice of resignation, the retiring
Administrative Agent’s resignation shall nevertheless thereupon become
effective and the Lenders shall perform all of the duties of the Administrative
Agent hereunder until such time, if any, as the Majority Lenders appoint a
successor agent as provided for above.


9.10.  Administrative Agent May File Proofs of
Claim.  In case of the pendency of
any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement,
adjustment, composition or other judicial proceeding relative to either of the
Loan Parties, the Administrative Agent (irrespective of whether the principal
of any Loan or L/C Obligation shall then be due and payable as herein expressed
or by declaration or otherwise and irrespective of whether the Administrative
Agent shall have made any demand on either of the Loan Parties) shall be
entitled and empowered, by intervention in such proceeding or otherwise:


(a)           to file and prove a claim for the whole
amount of the principal and interest owing and unpaid in respect of the Loans,
L/C Obligations and all other obligations that are owing and unpaid and to file
such other documents as may be necessary or advisable in order to have the
claims of the Lenders and the Administrative Agent (including any claim for the
reasonable compensation, expenses, disbursements and advances of the Lenders
and the Administrative Agent and their respective agents and counsel and all
other amounts due the Lenders and the Administrative Agent under Sections
2.5, 3.9 and 10.5) allowed in such judicial proceeding; and


(b)           to collect and receive any monies or
other property payable or deliverable on any such claims and to distribute the
same;


and any custodian,
receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Lender to make
such payments to the Administrative Agent and, in the event that the
Administrative Agent shall consent to the making of such payments directly to
the Lenders, to pay to the Administrative Agent any amount due for the
reasonable compensation, expenses, disbursements and advances of the
Administrative Agent and its agents and counsel, and any other amounts due the
Administrative Agent under Sections 2.5, 3.9 and 10.5.


Nothing contained herein
shall be deemed to authorize the Administrative Agent to authorize or consent
to or accept or adopt on behalf of any Lender any plan of reorganization,
arrangement, adjustment or composition affecting the obligations of the Loan
Parties hereunder or under any of the other Loan Documents or the rights of any
Lender or to authorize the Administrative Agent to vote in respect of the claim
of any Lender in any such proceeding.


9.11.  Guarantee and Collateral Matters.  The Lenders irrevocably authorize the
Administrative Agent, at its option and in its discretion,


(a)           to release any Lien on any property
granted to or held by the Administrative Agent under any Loan Document (i) upon
termination of the Total Revolving Credit Commitments and payment in full of
all obligations of the Loan 



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Parties hereunder or under any of the other Loan
Documents (other than contingent indemnification obligations) and the
expiration or termination of all Letters of Credit, (ii) that is sold or to be
sold as part of or in connection with any sale permitted hereunder or under any
other Loan Document, or (iii) subject to Section 10.1, if approved,
authorized or ratified in writing by the Majority Lenders; and


(b)           to subordinate any Lien on any
property granted to or held by the Administrative Agent under any Loan Document
to the holder of any Lien on such property that is permitted by Section 7.3,
and


(c)           to effect any release of Guarantee
Obligations contemplated by Section 10.17.


9.12.  Other Agents; Arrangers and Managers.  None of the Lenders or other Persons
identified on the facing page or signature pages of this Agreement as a “syndication
agent,” “documentation agent,” “co-agent,” “book manager,” “lead manager,” “arranger,”
“lead arranger” or “co-arranger” shall have any right, power, obligation,
liability, responsibility or duty under this Agreement other than, in the case
of such Lenders, those applicable to all Lenders as such.  Without limiting the foregoing, none of the
Lenders or other Persons so identified shall have or be deemed to have any
fiduciary relationship with any Lender. 
Each Lender acknowledges that it has not relied, and will not rely, on
any of the Lenders or other Persons so identified in deciding to enter into
this Agreement or in taking or not taking action hereunder.


10.          MISCELLANEOUS


10.1.  Amendments, Etc.  No amendment or waiver of any provision of
this Agreement or any other Loan Document, and no consent to any departure by
the Loan Parties therefrom, shall be effective unless in writing signed by the
Majority Lenders and the Loan Parties, as applicable, and delivered to the
Administrative Agent, and each such waiver or consent shall be effective only
in the specific instance and for the specific purpose for which given; provided,
however, that no such amendment, waiver or consent shall:


(a)           extend the expiration date of or
increase the Revolving Credit Commitment of any Lender (or reinstate any
Revolving Credit Commitment terminated pursuant to Section 8.2) without
the written consent of such Lender;


(b)           postpone any date fixed by this
Agreement or any other Loan Document for any payment (excluding mandatory
prepayments) of principal, interest or fees payable hereunder or under any other
Loan Document without the written consent of each Lender directly affected
thereby;


(c)           reduce the principal of, or the rate
of interest specified herein on, any Loan or L/C Borrowing, or, subject to clause
(v) of the second proviso to this Section 10.1, any fees or other
amounts payable hereunder or under any other Loan Document without the written
consent of each Lender directly affected thereby; provided, however,
that only the consent of the Majority Lenders shall be necessary to amend the
definition of “Default Rate” or to waive any obligation of the Borrower to pay
interest or Letter of Credit Fees at the Default Rate;


 



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(d)           change Section 2.14 in a
manner that would alter the pro rata sharing of payments required thereby
without the written consent of each Lender directly affected thereby; or


(e)           change any provision of this Section
10.1 or the percentage in the definition of “Majority Lenders” or any other
provision hereof specifying the number or percentage of Lenders required to
amend, waive or otherwise modify any rights hereunder or make any determination
or grant any consent hereunder, without the written consent of each Lender;


(f)            amend, modify or waive any provision
of Section 2.3 or 2.4 without the written consent of the Swing
Line Lender;


(g)           amend, modify or waive any provision
of Section 3 without the consent of the Issuing Lender;


(h)           amend, modify or waive the provisions
of the definition of Interest Period regarding nine or twelve month Interest
Periods for Eurodollar Loans without the consent of each relevant Lender;


(i)            consent to the assignment or
transfer by either of the Loan Parties of any of its rights and obligations
under this Agreement and the other Loan Documents; or


(j)            release the Parent from its
Guarantee Obligations under the Parent Guaranty except as provided in Section
10.17, without the consent of all Lenders;


and, provided  further,
that (i) no amendment, waiver or consent shall, unless in writing and signed by
the Issuing Lender in addition to the Lenders required above, modify the rights
or duties of the Issuing Lender under this Agreement or any Application
relating to any Letter of Credit issued or to be issued by it; (ii) no
amendment, waiver or consent shall, unless in writing and signed by the Swing
Line Lender in addition to the Lenders required above, modify the rights or
duties of the Swing Line Lender under this Agreement; (iii) no amendment,
waiver or consent shall, unless in writing and signed by the Administrative
Agent in addition to the Lenders required above, modify the rights or duties of
the Administrative Agent under this Agreement or any other Loan Document; and
(iv) Section 10.7(h) may not be amended, waived or otherwise modified
without the consent of each Granting Lender all or any part of whose Loans are
being funded by an SPC at the time of such amendment, waiver or other
modification; and (v) the Fee Letters may be amended, or rights or privileges
thereunder waived, in a writing executed only by the parties thereto.  Notwithstanding anything to the contrary
herein, no Defaulting Lender shall have any right to approve or disapprove any
amendment, waiver or consent hereunder, except that the Revolving Credit
Commitment of such Lender may not be increased or extended without the consent
of such Lender.


Any such waiver and any
such amendment, supplement or modification shall apply equally to each of the
Lenders and shall be binding upon the Loan Parties, the Lenders, the
Administrative Agent and all future holders of the Loans.  In the case of any waiver, the Loan 



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Parties, the
Lenders and the Administrative Agent shall be restored to their former position
and rights hereunder and under the other Loan Documents, and any Default or
Event of Default waived shall be deemed to be cured and not continuing; but no
such waiver shall extend to any subsequent or other Default or Event of
Default, or impair any right consequent thereon.  Any such waiver, amendment, supplement or
modification shall be effected by a written instrument signed by the parties
required to sign pursuant to the foregoing provisions of this Section 10.1;
provided, that delivery of an executed signature page of any such
instrument by facsimile transmission shall be effective as delivery of a
manually executed counterpart thereof.


For the avoidance of
doubt, this Agreement may be amended (or amended and restated) with the written
consent of the Majority Lenders, the Administrative Agent and the Loan Parties
party to each relevant Loan Document (x) to add one or more additional credit
facilities to this Agreement and to permit the extensions of credit from time
to time outstanding thereunder and the accrued interest and fees in respect
thereof to share ratably in the benefits of this Agreement and the other Loan
Documents with the Loans, the L/C Obligations and the accrued interest and fees
in respect thereof and (y) to include appropriately the Lenders holding such credit
facilities in any determination of the Majority Lenders.


10.2.  Notices; Effectiveness; Electronic
Communication.


(a)           Notices Generally.  Except in the case of notices and other
communications expressly permitted to be given by telephone (and except as
provided in subsection (b) below), all notices and other communications
provided for herein shall be in writing and shall be delivered by hand or
overnight courier service, mailed by certified or registered mail, sent by
telecopier or by electronic mail as follows, and all notices and other
communications expressly permitted hereunder to be given by telephone shall be
made to the applicable telephone number, as follows:


(i)            if to either Loan Party, the
Administrative Agent, the Issuing Lender or the Swing Line Lender, to the
address, telecopier number, electronic mail address or telephone number
specified for such Person on Schedule 10.2; and


(ii)           if to any other Lender, to the
address, telecopier number, electronic mail address or telephone number specified
in its Administrative Questionnaire.


Notices sent by hand or
overnight courier service, or mailed by certified or registered mail, shall be
deemed to have been given when received; notices sent by telecopier shall be
deemed to have been given when sent (except that, if not given during normal
business hours for the recipient, shall be deemed to have been given at the
opening of business on the next business day for the recipient).  Notices delivered through electronic
communications to the extent provided in subsection (b) below, shall be
effective as provided in such subsection (b).


(b)           Electronic Communications.  Notices and other communications to the
Lenders and the Issuing Lender hereunder may be delivered or furnished by
electronic communication (including e-mail and Internet or intranet
websites) pursuant to procedures approved by the Administrative Agent, provided
that the foregoing shall not apply to service of process or to notices to any
Lender or the Issuing Lender pursuant to Section 2.  The Administrative Agent or any Loan Party
may, in its discretion, agree to accept notices and other communications to it
hereunder by electronic communications pursuant to procedures approved by it, provided




 77
 









 


that approval of such procedures may be limited to
particular notices or communications.


Unless the Administrative
Agent otherwise prescribes, (i) notices and other communications sent to
an e-mail address shall be deemed received upon the sender’s receipt of an
acknowledgement from the intended recipient (such as by the “return receipt
requested” function, as available, return e-mail or other written
acknowledgement), provided that if such notice or other communication is
not sent during the normal business hours of the recipient, such notice or
communication shall be deemed to have been sent at the opening of business on
the next business day for the recipient, and (ii) notices or
communications posted to an Internet or intranet website shall be deemed
received upon the deemed receipt by the intended recipient at its e-mail
address as described in the foregoing clause (i) of notification
that such notice or communication is available and identifying the website
address therefor.


(c)           The Platform.  THE PLATFORM IS PROVIDED “AS IS” AND “AS
AVAILABLE.” THE AGENT-RELATED PERSONS DO NOT WARRANT THE ACCURACY OR
COMPLETENESS OF THE BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND
EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE BORROWER
MATERIALS.  NO WARRANTY OF ANY KIND,
EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR
FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT-RELATED
PERSONS OR LOAN PARTY IN CONNECTION WITH THE BORROWER MATERIALS OR THE
PLATFORM.  In no event shall the
Agent-Related Persons or any Loan Party have any liability to any Agent-Related
Person, any Loan Party, any Lender, or the Issuing Lender for losses, claims,
damages, liabilities or expenses of any kind (whether in tort, contract or
otherwise) arising out of any Loan Party’s or the Administrative Agent’s
transmission of Borrower Materials through the Internet, except to the extent
that such losses, claims, damages, liabilities or expenses are determined by a
court of competent jurisdiction by a final and nonappealable judgment to have
resulted from the gross negligence or willful misconduct of such Agent-Related
Persons or Loan Party; provided, however, that in no event shall
any Agent-Related Persons or Loan Party have any liability to any Agent-Related
Person, any Loan Party, any Lender, or the Issuing Lender for indirect,
special, incidental, consequential or punitive damages (as opposed to direct or
actual damages).  Each Lender agrees that
the Loan Parties shall be responsible only for the Borrower Materials and shall
not have any liability (unless otherwise agreed in writing by the Loan Parties)
for any other materials made available to the Lenders and shall not have any
liability for any errors or omissions other than errors or omissions in the
materials delivered to the Administrative Agent by any Loan Party.  Nothing in this Section 



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10.2(c) shall limit the obligation
of the Administrative Agent and the Lenders under Section 10.16.


(d)           Change of Address, Etc.  Each of the Loan Parties, the Administrative
Agent, the Issuing Lender and the Swing Line Lender may change its address,
telecopier or telephone number for notices and other communications hereunder
by notice to the other parties hereto.  Each
other Lender may change its address, telecopier or telephone number for notices
and other communications hereunder by notice to the Loan Parties, the
Administrative Agent, the Issuing Lender and the Swing Line Lender.  In addition, each Lender agrees to notify the
Administrative Agent from time to time to ensure that the Administrative Agent
has on record (i) an effective address, contact name, telephone number,
telecopier number and electronic mail address to which notices and other
communications may be sent and (ii) accurate wire instructions for such Lender.


(e)           Reliance by Administrative Agent,
Issuing Lender and Lenders.  The Administrative Agent, the
Issuing Lender and the Lenders shall be entitled to rely and act upon any
notices (including telephonic and written Borrowing Requests and notices of
Swing Line Loans) purportedly given by or on behalf of the Borrower; provided
that the foregoing shall not apply to losses, costs, expenses and
liabilities caused by the gross negligence or willful misconduct of the
relevant Lender or any Agent-Related Person even if (i) such notices were not
made in a manner specified herein, were incomplete or were not preceded or
followed by any other form of notice specified herein, or (ii) the terms
thereof, as understood by the recipient, varied from any confirmation
thereof.  Each of the Loan Parties shall
indemnify the Administrative Agent, the Issuing Lender, each Lender and the
Agent-Related Persons from all losses, costs, expenses and liabilities
resulting from the reliance by such Person on each notice purportedly given by
or on behalf of the Borrower; provided  that the foregoing shall
not apply to losses, costs, expenses and liabilities caused by the gross
negligence or willful misconduct of the relevant Lender or any Agent-Related
Person.  All telephonic notices to and
other telephonic communications with the Administrative Agent may be recorded
by the Administrative Agent, and each of the parties hereto hereby consents to
such recording.


(f)            Effectiveness of Facsimile
Documents and Signatures.  Loan
Documents may be transmitted and/or signed by facsimile.  The effectiveness of any such documents and
signatures shall, subject to applicable Law, have the same force and effect as
manually-signed originals and shall be binding on the Loan Parties, the
Administrative Agent and the Lenders. 
The Administrative Agent may also require that any such documents and
signatures be confirmed by a manually-signed original thereof; provided,
however, that the failure to request or deliver the same shall not limit
the effectiveness of any facsimile document or signature.


10.3.  No Waiver; Cumulative Remedies.  No failure to exercise and no delay in
exercising, on the part of the Administrative Agent or any Lender, any right,
remedy, power or privilege hereunder or under the other Loan Documents shall
operate as a waiver thereof; nor 



 79
 









 


shall any single
or partial exercise of any right, remedy, power or privilege hereunder preclude
any other or further exercise thereof or the exercise of any other right,
remedy, power or privilege.  The rights,
remedies, powers and privileges herein provided are cumulative and not
exclusive of any rights, remedies, powers and privileges provided by Law.


10.4.  Survival of Representations and Warranties.  All representations and warranties made
hereunder and in any other Loan Document or other document delivered pursuant
hereto or thereto or in connection herewith or therewith shall survive the
execution and delivery hereof and thereof. 
Such representations and warranties have been or will be relied upon by
the Administrative Agent and each Lender, regardless of any investigation made
by the Administrative Agent or any Lender or on their behalf and
notwithstanding that the Administrative Agent or any Lender may have had notice
or knowledge of any Default at the time of any extension of credit, and shall
continue in full force and effect as long as any Loan or any other obligation
hereunder shall remain unpaid or unsatisfied or any Letter of Credit shall
remain outstanding.


10.5.  Attorney Costs and Expenses.  The Borrower agrees (a) to pay or reimburse
the Administrative Agent and the Arrangers for all reasonable out-of-pocket
costs and expenses incurred in connection with the development, preparation, negotiation
and execution of this Agreement and the other Loan Documents and any amendment,
waiver, consent or other modification of the provisions hereof and thereof
(whether or not the transactions contemplated hereby or thereby are
consummated), and the consummation and administration of the transactions
contemplated hereby and thereby, including all Attorney Costs, and (b) to pay
or reimburse the Administrative Agent and each Lender for all reasonable
out-of-pocket costs and expenses (which may include, to the extent reasonably
incurred, all search, filing, recording, title insurance and appraisal charges
and fees and taxes related thereto, and other out-of-pocket expenses incurred
by the Administrative Agent and the cost of independent public accountants and
other outside experts) incurred in connection with the enforcement, attempted
enforcement, or preservation of any rights or remedies under this Agreement or
the other Loan Documents (including all such costs and expenses incurred during
any “workout” or restructuring in respect of the obligations of the Loan
Parties hereunder or under any of the other Loan Documents and during any legal
proceeding, including any proceeding under any Debtor Relief Law), including
all Attorney Costs.  All amounts due under
this Section 10.5 shall be payable not later than 30 days following
written demand.  The agreements in this Section
10.5 shall survive the termination of the Total Revolving Credit
Commitments and repayment of all other obligations.


10.6.  Indemnification.  (a) Whether or not the transactions
contemplated hereby are consummated, the Borrower shall indemnify and hold
harmless each Agent-Related Person, each Arranger, each Lender and their
respective Affiliates, directors, officers, employees, counsel, agents,
shareholders and attorneys-in-fact (collectively the “Indemnitees”) from
and against any and all liabilities, obligations, losses, damages, penalties,
claims, demands, actions, judgments, suits, settlement payments and causes of
action of any kind or nature whatsoever and reasonable related out-of-pocket
costs and expenses which may at any time be imposed on, incurred, suffered,
sustained, required to be paid by or asserted against any such Indemnitee in
any way relating to or arising out of or in connection with (a) the execution,
delivery, enforcement, performance or administration of any Loan Document or
any other agreement, letter or instrument delivered in connection with the
transactions contemplated thereby or the 



 80
 









 


consummation of
the transactions contemplated thereby, (b) any Revolving Credit Commitment,
Loan or Letter of Credit or the use or proposed use of the proceeds therefrom
(including any refusal by the Issuing Lender to honor a demand for payment
under a Letter of Credit if the documents presented in connection with such
demand do not strictly comply with the terms of such Letter of Credit), (c) any
actual or alleged presence or release of Hazardous Materials on or from any
property currently or formerly owned or operated by the Loan Parties or any
Subsidiary, or any Environmental Liability related in any way to the Loan
Parties or any of their Subsidiaries, or (d) any actual or prospective claim,
litigation, investigation or proceeding relating to any of the foregoing,
whether based on contract, tort or any other theory (including any
investigation of, preparation for, or defense of any pending or threatened
claim, investigation, litigation or proceeding) and regardless of whether any
Indemnitee is a party thereto (all the foregoing, collectively, the “Indemnified
Liabilities”), in all cases, whether or not caused by or arising, in whole
or in part, out of the negligence of the Indemnitee; provided that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
liabilities, obligations, losses, damages, penalties, claims, demands, actions,
judgments, suits, settlement payments, causes of action or costs or expenses
are determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of
such Indemnitee.  In all such litigation,
or the preparation therefor, the Indemnitees shall be entitled to select
counsel to the Indemnitees.  To the
extent reasonably practicable and not disadvantageous to any Indemnitee (as
reasonably determined by the relevant Indemnitee), it is anticipated that a
single counsel selected by the affected Lenders will be used.  No Indemnitee shall be liable to the Loan
Parties for any damages arising from the use by unintended recipients of any
information or other materials distributed to such unintended recipients by
such Indemnitee through telecommunications, electronic or other information
transmission systems in connection with this Agreement or the other Loan Documents
or the transactions contemplated hereby or thereby, and, to the fullest extent
permitted by applicable Law, each Loan Party shall not assert, and hereby
waives, any claim against any Indemnitee, on any theory of liability, for
special, indirect, consequential or punitive damages (as opposed to direct or
actual damages) arising out of, in connection with, or as a result of, this
Agreement, any other Loan Document or any agreement or instrument contemplated
hereby, the transactions contemplated hereby or thereby, any Loan or Letter of
Credit or the use of the proceeds thereof (whether before or after the Closing
Date); provided that this sentence shall not, as to any Indemnitee,
apply to the extent such Indemnitee is found by a final non-appealable judgment
of a court of competent jurisdiction to have acted with willful misconduct or
gross negligence.  All amounts due under
this Section 10.6 shall be payable not later than 30 days following
written demand.  The agreements in this Section
10.6 shall survive the resignation of the Administrative Agent, the
replacement of any Lender, the termination of the Total Revolving Credit
Commitments and the repayment, satisfaction or discharge of all the other
obligations of the Loan Parties hereunder.


(b)           To the extent that the Borrower for
any reason fails to indefeasibly pay any amount required under Section 10.5
and Section 10.6(a) to be paid by them to the Administrative Agent (or
any sub-agent thereof), the Issuing Lender or any Agent-Related Person of any
of the foregoing, each Lender severally agrees to pay to the Administrative
Agent (or any such sub-agent), the Issuing Lender or such Agent-Related Person,
as the case may be, such Lender’s Revolving Credit Percentage (determined as of
the time that the applicable unreimbursed expense or 



 81
 









 


indemnity payment is sought) of such unpaid amount, provided
that the unreimbursed expense or indemnified loss, claim, damage, liability or
related expense, as the case may be, was incurred by or asserted against the
Administrative Agent (or any such sub-agent) or the Issuing Lender in its
capacity as such, or against any Agent-Related Person of any of the foregoing
acting for the Administrative Agent (or any such sub-agent) or Issuing Lender
in connection with such capacity.  The
obligations of the Lenders under this Section 10.6(b) are subject to the
provisions of Section 2.14(f).


10.7.  Successors
and Assigns.


(a)           Successors and Assigns Generally.  The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby, except that the Loan
Parties may not assign or otherwise transfer any of their rights or obligations
hereunder without the prior written consent of the Administrative Agent and
each Lender and no Lender may assign or otherwise transfer any of its rights or
obligations hereunder except (i) to an Eligible Assignee in accordance with the
provisions of Section 10.7(b), (ii) by way of participation in
accordance with the provisions of Section 10.7(d), (iii) by way of
pledge or assignment of a security interest subject to the restrictions of Section
10.7(f), or (iv) to an SPC in
accordance with the provisions of Section 10.7(h) (and any other
attempted assignment or transfer by any party hereto shall be null and
void).  Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby,
Participants to the extent provided in Section 10.7(d) and, to the
extent expressly contemplated hereby, the Indemnitees) any legal or equitable
right, remedy or claim under or by reason of this Agreement.


(b)           Assignments by Lenders.  Any Lender may at any time assign to one or
more Eligible Assignees all or a portion of its rights and obligations under
this Agreement (including all or a portion of its Revolving Credit Commitment
and the Loans (including for purposes of this subsection (b),
participations in L/C Obligations and in Swing Line Loans) at the time owing to
it); provided that any such assignment shall be subject to the following
conditions:


(i)            Minimum Amounts.


(A)          in the case of an assignment of the
entire remaining amount of the assigning Lender’s Revolving Credit Commitment
and the Loans at the time owing to it or in the case of an assignment to a
Lender, an Affiliate of a Lender or an Approved Fund, no minimum amount need be
assigned; and


(B)           in any case not described in subsection
(b)(i)(A) of this Section 10.7, the aggregate amount of the
Revolving Credit Commitment (which for this purpose includes Loans outstanding
thereunder) or, if the Revolving Credit Commitment is not then in effect, the
principal outstanding balance of the Loans of the assigning Lender subject to each




 82
 









 


such assignment, determined as of the date the
Assignment and Assumption with respect to such assignment is delivered to the
Administrative Agent or, if “Trade Date” is specified in the Assignment and
Assumption, as of the Trade Date, shall not be less than $5,000,000  unless each of the Administrative Agent and, so long as no
Specified Event of Default has occurred and is continuing, the Borrower
otherwise consents (each such consent not to be unreasonably withheld or
delayed); provided, however, that concurrent assignments to
members of an Assignee Group and concurrent assignments from members of an
Assignee Group to a single assignee (or to an assignee and members of its
Assignee Group) will be treated as a single assignment for purposes of determining
whether such minimum amount has been met.


(ii)           Proportionate Amounts.  Each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender’s rights and
obligations under this Agreement with respect to the Loans or the Revolving
Credit Commitment assigned, except that this clause (ii) shall not apply
to the Swing Line Lender’s rights and obligations in respect of Swing Line
Loans;


(iii)          Required Consents.  No consent shall be required for any
assignment except to the extent required by subsection (b)(i)(B) of this
Section 10.7 and, provided that:


(A)          the consent of the Borrower (such
consent not to be unreasonably withheld or delayed) shall be required unless
(1) a Specified Event of Default has occurred and is continuing at the time of
such assignment or (2) such assignment is to a Lender, an Affiliate of a Lender
or an Approved Fund;


(B)           the consent of the Administrative
Agent (such consent not to be unreasonably withheld or delayed) shall be
required if such assignment is to a Person that is not a Lender or an Affiliate
of the assigning Lender;


(C)           the consent of the Issuing Lender
(such consent not to be unreasonably withheld or delayed) shall be required for
any assignment that increases the obligation of the assignee to participate in
exposure under one or more Letters of Credit (whether or not then outstanding);
and


(D)          the consent of the Swing Line Lender
(such consent not to be unreasonably withheld or delayed) shall be required for
any assignment.


(iv)          Assignment and Assumption.  The parties to each assignment shall execute
and deliver to the Administrative Agent an Assignment and Assumption, together
with a processing and recordation fee in the amount of $3,500; provided,
however, that the Administrative Agent may, in its sole discretion,
elect to waive 



 83
 









 


such processing and recordation fee in the case of any
assignment.  The assignee, if it is not a
Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire.


(v)           No Assignment to Borrower.  No such assignment shall be made to the
Borrower or any Affiliates or Subsidiaries of the Borrower.


(vi)          No Assignment to Natural Persons.  No such assignment shall be made to a natural
person.


(vii)         No Assignment to Approved Funds
Prior to Specified Event of Default. 
No such assignment shall be made to an Approved Fund prior to the
occurrence of a Specified Event of Default. 
After the occurrence and during the continuance of any Specified Event
of Default, an Approved Fund shall be an Eligible Assignee hereunder.


(viii)        Creditworthiness of Affiliates and
Approved Funds.  Notwithstanding the
foregoing, no such assignment shall be made to an Affiliate of a Lender or to
an Approved Fund unless such Affiliate or Approved Fund shall be a financial
institution having a senior unsecured debt rating of not less than  “A-”, or its equivalent, by S&P.


Subject to acceptance and
recording thereof by the Administrative Agent pursuant to Section 10.7(c),
from and after the effective date specified in each Assignment and Assumption,
the Eligible Assignee thereunder shall be a party to this Agreement and, to the
extent of the interest assigned by such Assignment and Assumption, have the
rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Assumption, be released from its obligations under this
Agreement (and, in the case of an Assignment and Assumption covering all of the
assigning Lender’s rights and obligations under this Agreement, such Lender
shall cease to be a party hereto) but shall continue to be entitled to the
benefits of Sections 2.15, 2.16, 2.17, 2.18, 10.5
and 10.6  with
respect to facts and circumstances occurring prior to the effective date of
such assignment.  Upon request, the
Borrower (at its expense) shall execute and deliver a Note to the assignee
Lender and a replacement Note, as applicable, to the assigning Lender.


(c)           Register.  The Administrative Agent, acting solely for
this purpose as an agent of the Borrower, shall maintain at the Administrative
Agent’s Office a copy of each Assignment and Assumption delivered to it and a
register for the recordation of the names and addresses of the Lenders, and the
Revolving Credit Commitments of, and principal amounts of the Loans and L/C
Obligations owing to, each Lender pursuant to the terms hereof from time to
time (the “Register”).  The
entries in the Register shall be conclusive, in the absence of manifest error,
and the Borrower, the Administrative Agent and the Lenders may treat each
Person whose name is recorded in the Register pursuant to the terms hereof as a
Lender hereunder for all purposes of this Agreement, notwithstanding notice to
the contrary.  The Register shall be
available for inspection by the Borrower and any Lender, at any reasonable time
and from time to time upon reasonable prior notice.



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(d)           Participations.  Any Lender may at any time, without the
consent of, or notice to, the Borrower or the Administrative Agent, sell
participations to any Person (other than a natural person or the Borrower or
any Affiliates or Subsidiaries of the Borrower) (each, a “Participant”)
in all or a portion of such Lender’s rights and/or obligations under this
Agreement (including all or a portion of its Revolving Credit Commitment and/or
the Loans (including such Lender’s participations in L/C Obligations and/or
Swing Line Loans) owing to it); provided that (i) such Lender’s
obligations under this Agreement shall remain unchanged, (ii) such Lender
shall remain solely responsible to the other parties hereto for the performance
of such obligations and (iii) the Borrower, the Administrative Agent, the
Lenders and the Issuing Lender shall continue to deal solely and directly with
such Lender in connection with such Lender’s rights and obligations under this
Agreement.


Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce this Agreement and to
approve any amendment, modification or waiver of any  provision of this Agreement; provided
that such agreement or instrument may provide that such Lender will not,
without the consent of the Participant, agree to any amendment, waiver or other
modification described in the first proviso to Section 10.1 that
directly affects such Participant. 
Subject to Section 10.7(e), the Borrower agrees that each
Participant shall be entitled to the benefits of Sections 2.15, 2.16
or 2.17 to the same
extent as if it were a Lender and had acquired its interest by assignment
pursuant to Section 10.7(b).  To
the extent permitted by Law, each Participant also shall be entitled to the
benefits of Section 10.8  as though it
were a Lender, provided such Participant agrees to be subject to Section
2.14 as though it were a Lender.


(e)           Limitations upon Participant
Rights.  A Participant shall not be
entitled to receive any greater payment under Sections 2.15, 2.16
or 2.17 than the applicable Lender would have been entitled to receive
with respect to the participation sold to such Participant, unless the sale of
the participation to such Participant is made with the Borrower’s prior written
consent.  A Participant that would be a
Non-U.S. Lender if it were a Lender shall not be entitled to the benefits of Section 2.16
unless the Borrower is notified of the participation sold to such Participant
and such Participant agrees, for the benefit of the Borrower, to comply with Section
2.16(d) and (e) as though it were a Lender.


(f)            Certain Pledges.  Notwithstanding anything to the contrary
contained herein, any Lender may, with notice to, but without prior consent of
the Borrower and the Administrative Agent, at any time pledge or assign a
security interest in all or any portion of its rights under this Agreement (including
under its Note, if any) to secure obligations of such Lender, including any
pledge or assignment to secure obligations to a Federal Reserve Bank (provided
that notice to the Borrower and the Administrative Agent shall not be required
in the case of a pledge or assignment to secure obligations to a Federal
Reserve Bank); provided further that no such pledge or assignment shall
release such Lender from any of its obligations hereunder or substitute, or
permit the substitution of, any such pledgee or assignee for such Lender as a
party hereto.



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(g)           Electronic Execution of
Assignments.  The words “execution,” “signed,”
“signature,” and words of like import in any Assignment and Assumption shall be
deemed to include electronic signatures or the keeping of records in electronic
form, each of which shall be of the same legal effect, validity or
enforceability as a manually executed signature or the use of a paper-based
recordkeeping system, as the case may be, to the extent and as provided for in
any applicable Law, including the Federal Electronic Signatures in Global and
National Commerce Act, the New York State Electronic Signatures and Records
Act, or any other similar state laws based on the Uniform Electronic
Transactions Act.


(h)           Special Purpose Funding Vehicles.  Notwithstanding anything to the
contrary contained herein, any Lender (a “Granting Lender”) may, with
notice to, but without prior consent of the Borrower and the Administrative
Agent grant to a special purpose funding vehicle identified as such in writing
from time to time by the Granting Lender to the Administrative Agent and the
Borrower (an “SPC”) the option to provide all or any part of any Loan
that such Granting Lender would otherwise be obligated to make pursuant to this
Agreement; provided that (i) nothing herein shall constitute a
commitment by any SPC to fund any Loan, and (ii) if an SPC elects not to
exercise such option or otherwise fails to make all or any part of such Loan,
the Granting Lender shall be obligated to make such Loan pursuant to the terms
hereof and, if it fails to do so, to make such payment to the Administrative
Agent as is required under Section 2.14(e)(ii).  Each party hereto hereby agrees that (i)
neither the grant to any SPC nor the exercise by any SPC of such option shall
increase the costs or expenses or otherwise increase or change the obligations
of the Borrower under this Agreement (including its obligations under Section
2.15), (ii) no SPC shall be liable for any indemnity or similar payment
obligation under this Agreement for which a Lender would be liable, and (iii)
the Granting Lender shall for all purposes, including the approval of any
amendment, waiver or other modification of any provision of any Loan Document,
remain the lender of record hereunder. 
The making of a Loan by an SPC hereunder shall utilize the Revolving
Credit Commitment of the Granting Lender to the same extent, and as if, such
Loan were made by such Granting Lender. 
In furtherance of the foregoing, each party hereto hereby agrees (which
agreement 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 debt 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 proceeding
under any Debtor Relief Laws or any other Laws. 
Notwithstanding anything to the contrary contained herein, any SPC may
(i) with notice to, but without prior consent of the Borrower and the
Administrative Agent and with the payment of a processing fee in the amount of
$3,500 (which processing fee may be waived by the Administrative Agent in its
sole discretion), assign all or any portion of its right to receive payment
with respect to any Loan to the Granting Lender and (ii) disclose on a
confidential basis any non-public information relating to its funding of Loans
to any rating agency, commercial paper dealer or provider of any surety or
guarantee or credit or liquidity enhancement to such SPC.


 



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(i)            Resignation as Issuing Lender or
Swing Line Lender after Assignment. 
Notwithstanding anything to the contrary contained herein, if at any
time Bank of America, N.A. assigns all of its Revolving Credit Commitment and
Loans pursuant to Section 10.7(b), Bank of America, N.A. may, (i) upon 30 days’ notice to the Borrower and
the Lenders, resign as Issuing Lender, so long as a successor Issuing Lender
(consented to by the Borrower, such consent not to be unreasonably withheld or
delayed) has been appointed and/or (ii) upon 30 days’ notice to the Borrower, resign as Swing Line Lender, so
long as a successor Swing Line Lender (consented to by the Borrower, such
consent not to be unreasonably withheld or delayed) has been appointed.  In the event of any such resignation as
Issuing Lender or Swing Line Lender, the Borrower shall be entitled to appoint
from among the Lenders a successor Issuing Lender or Swing Line Lender
hereunder; provided, however, that no failure by the Borrower to
appoint any such successor shall affect the resignation of Bank of America,
N.A. as Issuing Lender or Swing Line Lender, as the case may be.  If Bank of America, N.A. resigns as Issuing
Lender, it shall retain all the rights and obligations of the Issuing Lender
hereunder with respect to all Letters of Credit outstanding as of the effective
date of its resignation as Issuing Lender and all L/C Obligations with respect
thereto (including the right to require the Lenders to make Base Rate Loans or
fund risk participations in Unreimbursed Amounts pursuant to Section 3.3).  If Bank of America, N.A. resigns as Swing
Line Lender, it shall retain all the rights of the Swing Line Lender provided
for hereunder with respect to Swing Line Loans made by it and outstanding as of
the effective date of such resignation, including the right to require the
Lenders to make Base Rate Loans or fund risk participations in outstanding
Swing Line Loans pursuant to Section 2.4.  Upon the appointment of a successor Issuing
Lender and/or Swing Line Lender, (a) such successor shall succeed to and become
vested with all of the rights and obligations of the retiring Issuing Lender or
Swing Line Lender, as the case may be, and (b) the successor Issuing Lender
shall issue letters of credit in substitution for the Letters of Credit, if
any, outstanding at the time of such succession or make other arrangements
satisfactory to Bank of America, N.A. to effectively assume the obligations of
Bank of America, N.A. with respect to such Letters of Credit.


10.8.  Adjustments; Set-off.  (a) Except to the extent that this Agreement
provides for a payment to be allocated to a particular Lender, if any Lender (a
“Benefitted Lender”) shall at any time receive any payment of all or
part of the obligations under the Credit Agreement or the other Loan Documents,
owing to it, or receive any collateral in respect thereof (whether voluntarily
or involuntarily, by set-off, pursuant to events or proceedings of the
nature referred to in Section 8.1(c), or otherwise), in a greater
proportion than any such payment to or collateral received by any other Lender,
if any, in respect of such other Lender’s obligations under the Credit
Agreement or the other Loan Documents, such Benefitted Lender shall purchase
for cash from the other Lenders a participating interest in such portion of
each such other Lender’s obligations under the Credit Agreement or the other
Loan Documents, or shall provide such other Lenders with the benefits of any
such collateral, as shall be necessary to cause such Benefitted Lender to share
the excess payment or benefits of such collateral ratably with each of the
Lenders; provided, however, that if all or any portion of such excess payment
or benefits is 



 87
 









thereafter recovered from such Benefitted Lender, such
purchase shall be rescinded, and the purchase price and benefits returned, to
the extent of such recovery, but without interest.


(b)           In addition to any rights and
remedies of the Lenders provided by Law, each Lender shall have the right,
without prior notice to the Loan Parties, any such notice being expressly
waived by the Loan Parties to the extent permitted by applicable Law, upon any
amount becoming due and payable by a Loan Party hereunder (whether at the
stated maturity, by acceleration or otherwise), to set-off and appropriate and
apply against such amount any and all deposits (general or special, time or
demand, provisional or final), in any currency, and any other credits,
indebtedness or claims, in any currency, in each case whether direct or
indirect, absolute or contingent, matured or unmatured, at any time held or
owing by such Lender or any branch or agency thereof to or for the credit or
the account of such Loan Party.  Each
Lender agrees promptly to notify the Loan Parties, as the case may be, and the
Administrative Agent after any such set-off and application made by such
Lender, provided that the failure to give such notice shall not affect
the validity of such set-off and application.


10.9.  Counterparts.  This Agreement may be executed by one or more
of the parties to this Agreement on any number of separate counterparts, and
all of said counterparts taken together shall be deemed to constitute one and
the same instrument.  Delivery of an
executed signature page of this Agreement by facsimile transmission shall be
effective as delivery of a manually executed counterpart hereof.  A set of the copies of this Agreement signed
by all the parties shall be lodged with the Borrower and the Administrative
Agent.


10.10.  Severability.  Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.


10.11.  Integration.  This Agreement, the other Loan Documents and
the Fee Letters represent the entire agreement of the Loan Parties the
Administrative Agent, the Arrangers, the Syndication Agent and the Lenders with
respect to the subject matter hereof and thereof, and there are no promises,
undertakings, representations or warranties by the Arrangers, the
Administrative Agent, the Syndication Agent or any Lender relative to subject
matter hereof not expressly set forth or referred to herein, in the other Loan
Documents or in the Fee Letters.  The
Borrower agrees that its obligations under the Fee Letters shall survive the
execution and delivery of this Agreement.


10.12.  GOVERNING LAW.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK (EXCLUDING THE
LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW TO THE EXTENT THAT THE
APPLICATION OF THE LAW OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY).



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10.13.  SUBMISSION TO JURISDICTION; WAIVERS.  EACH OF THE LOAN PARTIES HEREBY IRREVOCABLY
AND UNCONDITIONALLY:


(a)           SUBMITS FOR ITSELF AND ITS PROPERTY
IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS TO WHICH IT IS A PARTY, OR FOR RECOGNITION AND ENFORCEMENT OF ANY
JUDGMENT IN RESPECT THEREOF, TO THE NON-EXCLUSIVE GENERAL JURISDICTION OF
THE COURTS OF THE STATE OF NEW YORK, THE COURTS OF THE UNITED STATES OF
AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK, AND APPELLATE COURTS FROM
ANY THEREOF;


(b)           CONSENTS THAT ANY SUCH ACTION OR
PROCEEDING MAY BE BROUGHT IN SUCH COURTS AND WAIVES ANY OBJECTION THAT IT MAY
NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH
COURT OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT COURT
AND AGREES NOT TO PLEAD OR CLAIM THE SAME;


(c)           AGREES THAT SERVICE OF PROCESS IN ANY
SUCH ACTION OR PROCEEDING MAY BE EFFECTED BY MAILING A COPY THEREOF BY
REGISTERED OR CERTIFIED MAIL (OR ANY SUBSTANTIALLY SIMILAR FORM OF MAIL),
POSTAGE PREPAID, TO THE LOAN PARTIES, AS THE CASE MAY BE, AT ITS ADDRESS SET
FORTH IN SECTION 10.2 OR AT SUCH OTHER ADDRESS OF WHICH THE
ADMINISTRATIVE AGENT SHALL HAVE BEEN NOTIFIED PURSUANT THERETO;


(d)           AGREES THAT NOTHING HEREIN SHALL
AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER PERMITTED BY
LAW OR SHALL LIMIT THE RIGHT TO SUE IN ANY OTHER JURISDICTION; AND


(e)           WAIVES, TO THE MAXIMUM EXTENT NOT
PROHIBITED BY LAW, ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY LEGAL
ACTION OR PROCEEDING REFERRED TO IN THIS SECTION 10.13 ANY SPECIAL,
EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES.


10.14.  WAIVERS
OF JURY TRIAL.  EACH PARTY TO THIS
AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM,
DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY
CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO
OR ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED
THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER
FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND 



 89
 









CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE
OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO
THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION 10.14 WITH ANY COURT AS WRITTEN EVIDENCE OF THE
CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY
JURY.


10.15.  No
Advisory or Fiduciary Responsibility.  In connection with this Agreement,
each of the Loan Parties acknowledges and agrees that: (a) the credit facility
provided for hereunder and any related arranging or other services in
connection therewith (including in connection with any amendment, waiver or
other modification hereof or of any other Loan Document) are an arm’s-length
commercial transaction between the Loan Parties and their respective
Affiliates, on the one hand, and the Administrative Agent and the Arrangers, on
the other hand, and each of the Loan Parties is capable of evaluating and
understanding and understands and accepts the terms, risks and conditions of
the transactions contemplated hereby and by the other Loan Documents (including
any amendment, waiver or other modification hereof or thereof); (b) in
connection with the process leading to such transaction, the Administrative
Agent and the Arrangers, each is and has been acting solely as a principal and
is not the financial advisor, agent or fiduciary, for the Loan Parties or any
of their respective Affiliates, stockholders, creditors or employees or any
other Person; (c) neither the Administrative Agent nor the Arrangers have
assumed or will assume an advisory, agency or fiduciary responsibility in favor
of either Loan Party with respect to this Agreement or the process leading
thereto, including with respect to any amendment, waiver or other modification
hereof or of any other Loan Document (irrespective of whether the
Administrative Agent or the Arrangers have advised or is currently advising the
Loan Parties or any of their respective Affiliates on other matters) and
neither the Administrative Agent nor the Arrangers have any obligation to the
Loan Parties or any of their respective Affiliates with respect to this
Agreement except those obligations expressly set forth herein and in the other
Loan Documents; (d) the Administrative Agent and the Arrangers and their respective
Affiliates may be engaged in a broad range of transactions that involve
interests that differ from those of the Loan Parties and their respective
Affiliates, and neither the Administrative Agent nor the Arrangers have any
obligation to disclose any of such interests by virtue of any advisory, agency
or fiduciary relationship; and (e) the Administrative Agent and the Arrangers
have not provided and will not provide any legal, accounting, regulatory or tax
advice with respect to this Agreement (including any amendment, waiver or other
modification hereof or of any other Loan Document) and each of the Loan Parties
has consulted its own legal, accounting, regulatory and tax advisors to the
extent it has deemed appropriate.


10.16.  Confidentiality.  Each of the Administrative Agent and the
Lenders agrees to maintain the confidentiality of the Information (as defined
below), except that Information may be disclosed (a) to its Affiliates and to
its and its Affiliates’ respective partners, directors, officers, employees,
agents, advisors and representatives (it being understood that the Persons to
whom such disclosure is made will be informed of the confidential nature of
such Information and instructed to keep such Information confidential), (b) to
the extent requested by any regulatory authority purporting to have
jurisdiction over it (including any self-regulatory authority, such as the
NAIC), (c) to the extent required by applicable Laws or by any subpoena or
similar legal process, (d) to any other party hereto, (e) in connection with
the exercise of any remedies hereunder or under any other Loan Document or any
action or proceeding relating to 



 90
 









this Agreement or any other Loan Document or the
enforcement of rights hereunder or thereunder, (f) subject to an agreement
containing provisions substantially the same as those of this Section 10.16, to (i) any assignee of or Participant in, or
any prospective assignee of or Participant in, any of its rights or obligations
under this Agreement or (ii) any actual or prospective counterparty (or its
advisors) to any swap or derivative transaction relating to the Borrower and
its obligations, (g) with the consent of the Loan Parties or (h) to the extent
such Information (x) becomes publicly available other than as a result of a
breach of this Section 10.16 or (y) becomes
available to the Administrative Agent or any Lender on a nonconfidential basis
from a source other than the Loan Parties. 
For purposes of this Section 10.16, “Information” means all information received from either of
the Loan Parties or any of its Subsidiaries relating to either of the Loan
Parties or any Subsidiary or any of their respective businesses, other than any
such information that is available to the Administrative Agent or any Lender on
a nonconfidential basis prior to disclosure by a Loan Party or any Subsidiary, provided that, in the case of information received from a
Loan Party or any Subsidiary after the date hereof, such information is clearly
identified at the time of delivery as confidential.  Any Person required to maintain the
confidentiality of Information as provided in this Section
10.16 shall be considered to have complied with its obligation to do
so if such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own
confidential information.


Each of the
Administrative Agent, the Lenders and the Issuing Lender acknowledges that (a)
the Information may include material non-public information concerning each
Loan Party or a Subsidiary thereof, as the case may be, (b) it has developed
compliance procedures regarding the use of material non-public information and
(c) it will handle such material non-public information in accordance with
applicable Law, including Federal and state securities Laws.


10.17.  Release of Guarantee Obligations.  Notwithstanding anything to the contrary
contained herein or any other Loan Document, when all obligations of the
Borrower hereunder and under the other Loan Documents that are guaranteed under
the Parent Guaranty have been paid in full, all Revolving Credit Commitments
have terminated, there exist no unpaid Reimbursement Obligations and no Letter
of Credit issued for the account of the Borrower shall be outstanding, upon request
of the Loan Parties, the Administrative Agent shall (without notice to, or vote
or consent of, any Lender) take such actions as may be required to release all
Guarantee Obligations of the Parent under the Parent Guaranty.  Any such release of Guarantee Obligations
under the Parent Guaranty shall be deemed subject to the provision that such
Guarantee Obligations under the Parent Guaranty shall be reinstated if after
such release any portion of any payment in respect of the obligations
guaranteed thereby shall be rescinded or must otherwise be restored or returned
upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of
the Borrower or the Parent, or upon or as a result of the appointment of a
receiver, intervener or conservator of, or trustee or similar officer for, the
Borrower or the Parent or any substantial part of its respective property, or
otherwise, all as though such payment had not been made.


10.18.  Accounting Changes.  In the event that any “Accounting Change” (as
defined below) shall occur and such change results in a change in the method of
calculation of financial covenants, standards or terms in this Agreement, then
the Loan Parties and the Administrative Agent agree to enter into negotiations
in order to amend such provisions of this 



 91
 









Agreement so as to equitably reflect such Accounting
Changes with the desired result that the criteria for evaluating the Loan
Parties’ financial condition shall be the same after such Accounting Changes as
if such Accounting Changes had not been made. 
Until such time as such an amendment shall have been executed and
delivered by the Loan Parties, the Administrative Agent and the Majority
Lenders, all financial covenants, standards and terms in this Agreement shall
continue to be calculated or construed as if such Accounting Changes had not
occurred.  “Accounting Changes” refers to
changes in accounting principles required by the promulgation of any rule,
regulation, pronouncement or opinion by the Financial Accounting Standards
Board of the American Institute of Certified Public Accountants, applicable
Insurance Regulators, the NAIC or, if applicable, the SEC.


10.19.    USA PATRIOT Act Notice.  Each Lender that is subject to the Act (as
hereinafter defined) and the Administrative Agent (for itself and not on behalf
of any Lender) hereby notifies the Loan Parties that pursuant to the
requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)) (the “Act”), it is required to obtain, verify and
record information that identifies the Loan Parties, which information includes
the name and address of the Loan Parties and other information that will allow
such Lender or the Administrative Agent, as applicable, to identify the Loan
Parties in accordance with the Act.


10.20.  Interest Rate Limitation.


(a)           Notwithstanding anything to the
contrary contained in any Loan Document, if at any time the rate of interest
payable under any Loan Document (the “Stated Rate”) would exceed the
rate of interest permitted to be charged under any applicable Law (the “Maximum
Rate”), then for so long as the Maximum Rate would be so exceeded, the rate
of interest payable shall be equal to the Maximum Rate; provided that if
at any time thereafter, the Stated Rate is less than the Maximum Rate, the
Borrower shall, to the extent permitted by applicable Law, continue to pay
interest at the Maximum Rate until such time as the total interest received is
equal to the total interest which would have been received had the Stated Rate
been (but for the operation of this provision) the interest rate payable.  Thereafter, the interest rate payable shall
be the Stated Rate unless and until the Stated Rate again would exceed the
Maximum Rate, in which event this provision shall again apply.


(b)           In no event shall the total interest
received by a Lender exceed the amount which it could lawfully have received
had the interest been calculated for the full term hereof at the Maximum Rate.


[Remainder of Page Left Intentionally Blank]



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IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be duly executed and delivered by
their proper and duly authorized officers as of the day and year first above
written.


	
   

  	
   

  	
  The Borrower:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  FUND AMERICAN COMPANIES, INC.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Parent:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ONEBEACON INSURANCE GROUP, LTD.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
					



 


















	
  

  	
   

  	
  BANK OF AMERICA, N.A., as 

  	
   

  
	
   

  	
   

  	
  Administrative Agent

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  BANK OF AMERICA, N.A., as 

  	
   

  
	
   

  	
   

  	
  a Lender, Issuing Lender and Swing Line Lender

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
					



 



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  LEHMAN BROTHERS BANK, FSB,
  as

  	
   

  
	
   

  	
   

  	
  a Lender

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
					



 



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SCHEDULE
10.02


ADMINISTRATIVE
AGENT’S OFFICE;

CERTAIN ADDRESSES FOR NOTICES


LOAN PARTIES:


OneBeacon Insurance Company


One Beacon Street


Boston, MA 
02108-3100


Attention: Thomas Forsyth


Telephone: 617-725-7169


Telecopier: 617-725-7177


Electronic Mail: tforsyth@onebeacon.com


U.S. Taxpayer Identification Number (Fund American Companies, Inc.):
52-2272489

U.S. Taxpayer Identification Number (OneBeacon Insurance Group, Ltd.):
98-0503315


 


 


 


 


 


with a copy to:


 


Cravath, Swaine and Moore
LLP


WorldWide Plaza


825 Eighth Avenue


New York, NY 10019-7475


Attention: Paul Michalski


Telecopier: 212-474-3700


 


ADMINISTRATIVE
AGENT:


 


Administrative Agent’s Office


(for payments and Requests for Credit Extensions):


Bank of America, N.A.


2001 Clayton Road


Mail Code” CA4-702-02-25


Concord, CA 94520


Attention: Tina Obcena


Telephone: 925-675-8768


Telecopier: 888-969-9246


Electronic Mail:
tina.obcena@bankofamerica.com


Account No.: 3750836479


Ref:  White Mountains Insurance Group


ABA# 026009593


 


















Other Notices as Administrative
Agent:


Bank of America, N.A.


Agency Management


1455 Market Street, 5th Floor


Mail Code: CA5-701-05-19


San Francisco, CA 94103


Attention: Aamir Saleem


Telephone: 415-436-2769


Telecopier: 415-503-5089


Electronic Mail:  aamir.saleem@bankofamerica.com


ISSUING LENDER:


 


Bank of America, N.A.


Trade Operations


1000 W. Temple Street


Mail Code: CA9-705-07-05


Los Angeles, CA 90012-1514


Attention: Stella Rosales


Telephone: 213-481-7828


Telecopier: 213-580-8441


Electronic Mail:  stella.rosales@bankofamerica.com


 


SWING
LINE LENDER:


 


Bank of America, N.A.


2001 Clayton Road


Mail Code” CA4-702-02-25


Concord, CA 94520


Attention: Tina Obcena


Telephone: 925-675-8768


Telecopier: 888-969-9246


Electronic Mail:
tina.obcena@bankofamerica.com


Account No.: 3750836479


Ref:  White Mountains Insurance Group


ABA# 026009593



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