Exhibit
10.1


 


EXECUTION COPY


 


 


U.S. $1,000,000,000


 


 


FIVE YEAR CREDIT AGREEMENT


 


Dated as of June 10, 2005


 


Among


 


THE ST. PAUL TRAVELERS COMPANIES, INC.


as
Borrower


 


and


 


THE INITIAL LENDERS NAMED HEREIN


 


as
Initial  Lenders


 


and


 


CITICORP USA, INC.


 


as
Administrative  Agent


 


and


 


CITIGROUP GLOBAL MARKETS INC.


 


J.P. MORGAN SECURITIES INC.


 


as
Joint  Lead  Arrangers


 


and


 


JPMORGAN CHASE BANK, N.A.


 


as
Syndication  Agent


 


and


 


BANK OF AMERICA, N.A.


THE
BANK OF NEW YORK


and


WELLS FARGO BANK, NATIONAL ASSOCIATION


 


as
Documentation  Agents


 





















 


TABLE OF CONTENTS


 


	
  ARTICLE I

  	
   

  
	
   

  	
   

  
	
  SECTION 1.01. Certain Defined Terms

  	
   

  
	
   

  	
   

  
	
  SECTION 1.02. Computation of Time Periods

  	
   

  
	
   

  	
   

  
	
  SECTION 1.03. Accounting Terms

  	
   

  
	
   

  	
   

  
	
  ARTICLE II

  	
   

  
	
   

  	
   

  
	
  SECTION 2.01. The Revolving Credit Advances
  and Letters of Credit

  	
   

  
	
   

  	
   

  
	
  SECTION 2.02. Making the Revolving Credit
  Advances

  	
   

  
	
   

  	
   

  
	
  SECTION 2.03. Issuance of and Drawings and
  Reimbursement Under Letters of Credit

  	
   

  
	
   

  	
   

  
	
  SECTION 2.04. The Competitive Bid Advances

  	
   

  
	
   

  	
   

  
	
  SECTION 2.05. Fees

  	
   

  
	
   

  	
   

  
	
  SECTION 2.06. Optional Termination or
  Reduction of the Commitments

  	
   

  
	
   

  	
   

  
	
  SECTION 2.07. Repayment of Revolving Credit
  Advances

  	
   

  
	
   

  	
   

  
	
  SECTION 2.08.
  Interest on Revolving Credit Advances

  	
   

  
	
   

  	
   

  
	
  SECTION 2.09.
  Interest Rate Determination

  	
   

  
	
   

  	
   

  
	
  SECTION 2.10.
  Optional Conversion of Revolving Credit Advances

  	
   

  
	
   

  	
   

  
	
  SECTION 2.11.
  Prepayments of Revolving Credit Advances

  	
   

  
	
   

  	
   

  
	
  SECTION 2.12.
  Increased Costs

  	
   

  
	
   

  	
   

  
	
  SECTION 2.13.
  Illegality

  	
   

  
	
   

  	
   

  
	
  SECTION 2.14.
  Payments and Computations

  	
   

  
	
   

  	
   

  
	
  SECTION 2.15.
  Taxes

  	
   

  
	
   

  	
   

  
	
  SECTION 2.16.
  Sharing of Payments, Etc.

  	
   

  
	
   

  	
   

  
	
  SECTION 2.17.
  Evidence of Debt

  	
   

  
	
   

  	
   

  
	
  SECTION 2.18.
  Use of Proceeds

  	
   

  
	
   

  	
   

  
	
  SECTION 2.19.
  Increase in the Aggregate Commitments

  	
   

  



 





















 


	
  SECTION 2.20.
  Extension of Termination Date

  	
   

  
	
   

  	
   

  
	
  SECTION 2.21.
  Replacement of Lenders

  	
   

  
	
   

  	
   

  
	
  ARTICLE III

  	
   

  
	
   

  	
   

  
	
  SECTION 3.01.
  Conditions Precedent to Effectiveness of Sections 2.01 and 2.04

  	
   

  
	
   

  	
   

  
	
  SECTION 3.02. Conditions Precedent to Each
  Revolving Credit Borrowing, Issuance, Commitment Increase and Extension of
  Commitments.

  	
   

  
	
   

  	
   

  
	
  SECTION 3.03.
  Conditions Precedent to Each Competitive Bid Borrowing

  	
   

  
	
   

  	
   

  
	
  SECTION 3.04.
  Determinations Under Section 3.01

  	
   

  
	
   

  	
   

  
	
  ARTICLE IV

  	
   

  
	
   

  	
   

  
	
  SECTION 4.01.
  Representations and Warranties of the Borrower

  	
   

  
	
   

  	
   

  
	
  ARTICLE V

  	
   

  
	
   

  	
   

  
	
  SECTION 5.01.
  Affirmative Covenants

  	
   

  
	
   

  	
   

  
	
  SECTION 5.02.
  Negative Covenants

  	
   

  
	
   

  	
   

  
	
  SECTION 5.03.
  Financial Covenants

  	
   

  
	
   

  	
   

  
	
  ARTICLE VI

  	
   

  
	
   

  	
   

  
	
  SECTION 6.01.
  Events of Default

  	
   

  
	
   

  	
   

  
	
  SECTION 6.02.
  Actions in Respect of the Letters of Credit upon Default

  	
   

  
	
   

  	
   

  
	
  ARTICLE VII

  	
   

  
	
   

  	
   

  
	
  SECTION 7.01.
  Authorization and Action

  	
   

  
	
   

  	
   

  
	
  SECTION 7.02.
  Agent’s Reliance, Etc.

  	
   

  
	
   

  	
   

  
	
  SECTION 7.03.
  Citicorp and Affiliates

  	
   

  
	
   

  	
   

  
	
  SECTION 7.04.
  Lender Credit Decision

  	
   

  
	
   

  	
   

  
	
  SECTION 7.05.
  Indemnification

  	
   

  
	
   

  	
   

  
	
  SECTION 7.06.
  Successor Agent

  	
   

  
	
   

  	
   

  
	
  SECTION 7.07.
  Other Agents.

  	
   

  



 


ii





















 


	
  ARTICLE VIII

  	
   

  
	
   

  	
   

  
	
  SECTION 8.01.
  Amendments, Etc.

  	
   

  
	
   

  	
   

  
	
  SECTION 8.02.
  Notices, Etc.

  	
   

  
	
   

  	
   

  
	
  SECTION 8.03.
  No Waiver; Remedies

  	
   

  
	
   

  	
   

  
	
  SECTION 8.04.
  Costs and Expenses

  	
   

  
	
   

  	
   

  
	
  SECTION 8.05.
  Right of Set-off

  	
   

  
	
   

  	
   

  
	
  SECTION 8.06.
  Binding Effect

  	
   

  
	
   

  	
   

  
	
  SECTION 8.07.
  Assignments and Participations

  	
   

  
	
   

  	
   

  
	
  SECTION 8.08.
  Confidentiality

  	
   

  
	
   

  	
   

  
	
  SECTION 8.09.
  Governing Law

  	
   

  
	
   

  	
   

  
	
  SECTION 8.10.
  Execution in Counterparts

  	
   

  
	
   

  	
   

  
	
  SECTION 8.11.
  Jurisdiction, Etc.

  	
   

  
	
   

  	
   

  
	
  SECTION 8.12.
  No Liability of the Issuing Banks

  	
   

  
	
   

  	
   

  
	
  SECTION 8.13.
  Patriot Act

  	
   

  
	
   

  	
   

  
	
  SECTION 8.14.
  Waiver of Jury Trial

  	
   

  



 


iii





















 


	
  Schedules

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Schedule I - List of Applicable
  Lending Offices

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Schedule 2.01(b) – Existing
  Letters of Credit

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Schedule 3.01(b) - Disclosed
  Litigation

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Schedule 4.01(e) - Accounting
  Matters

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Schedule 5.02(a) - Existing Liens

  	
   

  	
   

  
	
   

  	
   

  
	
  Exhibits

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit A-1

  	
  -

  	
  Form of Revolving Credit Note

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit A-2

  	
  -

  	
  Form of Competitive Bid Note

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit B-1

  	
  -

  	
  Form of Notice of Revolving Credit Borrowing

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit B-2

  	
  -

  	
  Form of Notice of Competitive Bid Borrowing

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit C

  	
  -

  	
  Form of Assignment and Acceptance

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit D

  	
  -

  	
  Form of Opinion of Counsel for the Borrower

  	
   

  
					



 


iv





















 


FIVE YEAR CREDIT AGREEMENT


 


Dated as of June 10, 2005


 


THE ST. PAUL TRAVELERS
COMPANIES, INC., a Minnesota corporation (the “Borrower”), the banks,
financial institutions and other institutional lenders (the “Initial Lenders”)
and issuers of letters of credit (“Initial Issuing Banks”) listed on Schedule I
hereto, JPMORGAN CHASE BANK, N.A., as syndication agent, BANK OF AMERICA, N.A.,
THE BANK OF NEW YORK and WELLS FARGO BANK, NATIONAL ASSOCIATION, as
documentation agents, CITIGROUP GLOBAL MARKETS INC. and J.P. MORGAN SECURITIES
INC., as joint lead arrangers, and CITICORP USA, INC. (“Citicorp”), as
agent (the “Agent”) for the Lenders (as hereinafter defined), agree as
follows:


 


ARTICLE I


 


DEFINITIONS AND ACCOUNTING
TERMS


 


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


 


“Advance”
means a Revolving Credit Advance or a Competitive Bid Advance.


 


“Affiliate”
means, as to any Person, any other Person that, directly or indirectly,
controls, is controlled by or is under common control with such Person.


 


“Agent’s
Account” means the account of the Agent maintained by the Agent at Citibank
at its office at Two Penns Way, New Castle, Delaware 19720, Account No. 36852248,
Attention:  Bank Loan Syndications.


 


“Applicable
Lending Office” means, with respect to each Lender, such Lender’s Domestic
Lending Office in the case of a Base Rate Advance and such Lender’s Eurodollar
Lending Office in the case of a Eurodollar Rate Advance and, in the case of a
Competitive Bid Advance, the office of such Lender notified by such Lender to
the Agent as its Applicable Lending Office with respect to such Competitive Bid
Advance.


 


“Applicable
Margin” means (a) for Base Rate Advances, 0% per annum and (b) for
Eurodollar Rate Advances, as of any date, a percentage per annum determined by
reference to the Public Debt Rating in effect on such date as set forth below:


 




	
  Public
  Debt Rating

  S&P/Moody’s

  	
   

  	
  Applicable Margin for

  Eurodollar Rate Advances

  	
   

  
	
  Level 1

  A+ or A1

  	
   

  	
  0.200

  	
  %

  
	
  Level 2

  A or A2

  	
   

  	
  0.215

  	
  %

  
	
  Level 3

  A- or A3

  	
   

  	
  0.275

  	
  %

  
	
  Level 4

  BBB+ or Baa1

  	
   

  	
  0.300

  	
  %

  
	
  Level 5

  Lower than Level 4

  	
   

  	
  0.375

  	
  %

  






 


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


 





















 




	
  Public
  Debt Rating

  S&P/Moody’s

  	
   

  	
  Applicable

  Percentage

  	
   

  
	
  Level 1

  A+ or A1

  	
   

  	
  0.050

  	
  %

  
	
  Level 2

  A or A2

  	
   

  	
  0.060

  	
  %

  
	
  Level 3

  A- or A3

  	
   

  	
  0.075

  	
  %

  
	
  Level 4

  BBB+ or Baa1

  	
   

  	
  0.100

  	
  %

  
	
  Level 5

  Lower than Level 4

  	
   

  	
  0.125

  	
  %

  






 


“Applicable
Utilization Fee” means, as of any date that the aggregate Advances exceed
50% of the aggregate Revolving Credit Commitments, a percentage per annum
determined by reference to the Public Debt Rating in effect on such date as set
forth below:


 




	
  Public
  Debt Rating

  S&P/Moody’s

  	
   

  	
  Applicable

  Utilization Fee

  	
   

  
	
  Level 1

  A+ or A1

  	
   

  	
  0.075

  	
  %

  
	
  Level 2

  A or A2

  	
   

  	
  0.075

  	
  %

  
	
  Level 3

  A- or A3

  	
   

  	
  0.075

  	
  %

  
	
  Level 4

  BBB+ or Baa1

  	
   

  	
  0.075

  	
  %

  
	
  Level 5

  Lower than Level 4

  	
   

  	
  0.075

  	
  %

  






 


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


 


“Assuming
Lender” has the meaning specified in Section 2.19(d).


 


“Assumption
Agreement” has the meaning specified in Section 2.19(d)(ii).


 


“Available Amount”
of any Letter of Credit means, at any time, the maximum amount available to be
drawn under such Letter of Credit at such time (assuming compliance at such
time with all conditions to drawing).


 


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


 


(a)           the rate of interest announced
publicly by Citibank in New York, New York, from time to time, as
Citibank’s base rate;


 


(b)           1⁄2 of one percent per annum above the
Federal Funds Rate.


 


“Base Rate
Advance” means a Revolving Credit Advance that bears interest as provided
in Section 2.08(a)(i).


 


2





















 


“Borrowing”
means a Revolving Credit Borrowing or a Competitive Bid Borrowing.


 


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


 


“Citibank”
means Citibank, N.A.


 


“Commitment”
means a Revolving Credit Commitment or a Letter of Credit Commitment.


 


“Commitment
Date” has the meaning specified in Section 2.19(b).


 


“Commitment
Increase” has the meaning specified in Section 2.19(a).


 


“Competitive
Bid Advance” means an advance by a Lender to the Borrower as part of a
Competitive Bid Borrowing resulting from the competitive bidding procedure
described in Section 2.04 and refers to a Fixed Rate Advance or a LIBO
Rate Advance.


 


“Competitive
Bid Borrowing” means a borrowing consisting of simultaneous Competitive Bid
Advances from each of the Lenders whose offer to make one or more Competitive
Bid Advances as part of such borrowing has been accepted under the competitive
bidding procedure described in Section 2.04.


 


“Competitive
Bid Note” means a promissory note of the Borrower payable to the order of
any Lender, in substantially the form of Exhibit A-2 hereto, evidencing
the indebtedness of the Borrower to such Lender resulting from a Competitive
Bid Advance made by such Lender.


 


“Confidential
Information” means all non-public information that the Borrower furnishes
to the Agent or any Lender, but does not include any such information that is
or becomes generally available to the public or that is or becomes available to
the Agent or such Lender from a source other than the Borrower or a Person who
is known by the Agent or such Lender to be in violation of a confidentiality
agreement with the Borrower.


 


“Consenting
Lender” has the meaning specified in Section 2.20(b).


 


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


 


“Convert”,
“Conversion” and “Converted” each refers to a conversion of
Revolving Credit Advances of one Type into Revolving Credit Advances of the
other Type pursuant to Section 2.09 or 2.10.


 


“Debt”
of any Person means, without duplication, (a) all indebtedness of such
Person for borrowed money, (b) all obligations of such Person for the
deferred purchase price of property or services (other than trade payables
incurred in the ordinary course of such Person’s business that (x) are not
overdue by more than 120 days or (y) are being contested in good faith and by
proper proceedings and as to which appropriate reserves are being maintained), (c) all
obligations of such Person evidenced by notes, bonds, debentures or other
similar instruments, (d) all obligations of such Person created or arising
under any conditional sale or other title retention agreement with respect to
property acquired by such Person (even though the rights and remedies of the
seller or lender under such agreement in the event of default are limited to
repossession or sale of such property), (e) all obligations of such Person
as lessee under leases that have been or should be, in accordance with GAAP,
recorded as capital leases (the amount of Debt attributable thereto to be the
capitalized amount thereof in accordance with GAAP), (f) all obligations,
contingent or otherwise, of such Person in respect of acceptances, letters of
credit or similar extensions of credit, (g) all obligations of such Person
in respect of Hedge Agreements, (h) all Debt of others referred to in
clauses (a) through (g) above or clause (i) below and
other payment obligations guaranteed directly or indirectly in any manner by
such Person, or in effect guaranteed directly or indirectly by such Person


 


3





















 


through an agreement (1) to pay or
purchase such Debt or to advance or supply funds for the payment or purchase of
such Debt, (2) to purchase, sell or lease (as lessee or lessor) property,
or to purchase or sell services, primarily for the purpose of enabling the
debtor to make payment of such Debt or to assure the holder of such Debt
against loss, (3) to supply funds to or in any other manner invest in the
debtor (including any agreement to pay for property or services irrespective of
whether such property is received or such services are rendered) or (4) otherwise
to assure a creditor against loss, and (i) all Debt referred to in
clauses (a) through (h) above secured by (or for which the
holder of such Debt has an existing right to be secured by) any Lien on
property (including, without limitation, accounts and contract rights) owned by
such Person (the amount of Debt attributable thereto to be equal to the lesser
of (i) the amount of such Debt and (ii) the fair market value of the
property subject to such Lien), even though such Person has not assumed or
become liable for the payment of such Debt. For purposes of calculating the
amount of Debt pursuant to clause (g) of the foregoing definition, such amount
shall be equal to the amount that would be payable (giving effect to netting
arrangements) by the relevant Person if the Hedge Agreement were terminated.


 


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


 


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


 


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


 


“Effective
Date” has the meaning specified in Section 3.01.


 


“Eligible
Assignee” means (i) a Lender; (ii) an Affiliate of a Lender; and (iii) any
other Person approved by the Agent and, unless an Event of Default has occurred
and is continuing at the time any assignment is effected in accordance with Section 8.07,
the Borrower, such approval not to be unreasonably withheld or delayed, provided,
that if an Event of Default has occurred and is continuing such that the
Borrower does not have a right of approval with respect to any Eligible
Assignee under this clause (iii), such Person shall be a commercial bank
organized or licensed under the laws of the United States, or any State
thereof, and have a long-term senior unsecured debt rating of not worse than A
by S&P or A2 by Moody’s (unless the Borrower otherwise approves such
Eligible Assignee); provided, however, that neither the Borrower
nor an Affiliate of the Borrower shall qualify as an Eligible Assignee.


 


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


 


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


 


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


 


“ERISA
Event” means (a) (i) the occurrence of a reportable event, within
the meaning of Section 4043 of ERISA, with respect to any Plan unless the
30-day notice requirement with respect to such event has been waived by the
PBGC, or (ii) the requirements of subsection (1) of Section 4043(b) of
ERISA are met with respect to a contributing sponsor, as defined in Section 4001(a)(13)
of ERISA, of a


 


4





















 


Plan, and an event described in paragraph (9),
(10), (11), (12) or (13) of Section 4043(c) of ERISA is reasonably
expected to occur with respect to such Plan within the following 30 days; (b) the
application for a minimum funding standard waiver with respect to a Plan; (c) the
provision by the administrator of any Plan of a notice of intent to terminate
such Plan pursuant to Section 4041(a)(2) of ERISA (including any such
notice with respect to a plan amendment referred to in Section 4041(e) of
ERISA); (d) the cessation of operations at a facility of the Borrower or
any ERISA Affiliate in the circumstances described in Section 4062(e) of
ERISA that is treated as a withdrawal under such Section; (e) the
withdrawal by the Borrower or any ERISA Affiliate from a Multiple Employer Plan
during a plan year for which it was a substantial employer, as defined in Section 4001(a)(2) of
ERISA; (f) the imposition of a lien under Section 302(f) of
ERISA with respect to any Plan; (g) the adoption of an amendment to a Plan
requiring the provision of security to such Plan pursuant to Section 307
of ERISA; or (h) the institution by the PBGC of proceedings to terminate a
Plan pursuant to Section 4042 of ERISA, or the occurrence of any event or
condition described in Section 4042 of ERISA that constitutes grounds for
the termination of, or the appointment of a trustee to administer, a Plan, provided,
however, that the event or condition described in Section 4042(a)(4) shall
be an ERISA Event only if the PBGC shall have notified the Borrower or any
ERISA Affiliate that it intends to terminate, or appoint a trustee to
administer, a Plan on such basis.


 


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


 


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


 


“Eurodollar
Rate” means, for any Interest Period for each Eurodollar Rate Advance
comprising part of the same Revolving Credit Borrowing, an interest rate per
annum equal to the rate per annum (rounded upward to the nearest whole multiple
of 1/16 of 1% per annum) appearing on Moneyline Telerate Markets Page 3750
(or any successor or substitute page of such service, or any successor to
such service, providing rate quotations comparable to those currently provided
on such page of such service, as determined by the Agent from time to
time, for purposes of providing quotations of interest rates applicable to U.S.
dollar deposits in the London interbank market) as the London interbank offered
rate for deposits in U.S. dollars at approximately 11:00 A.M. (London
time) two Business Days prior to the first day of such Interest Period for a
term comparable to such Interest Period or, if for any reason such rate is not
available, the average (rounded upward to the nearest whole multiple of
1/16 of 1% per annum, if such average is not such a multiple) of the rate per
annum at which deposits in U.S. dollars are offered by the principal office of
each of the Reference Banks in London, England to prime banks in the London
interbank market at 11:00 A.M. (London time) two Business Days before the
first day of such Interest Period in an amount substantially equal to such
Reference Bank’s Eurodollar Rate Advance comprising part of such Revolving
Credit Borrowing to be outstanding during such Interest Period and for a period
equal to such Interest Period. If the Moneyline Telerate Markets Page 3750
(or any successor or substitute page of such service, or any successor to
such service, providing rate quotations comparable to those currently provided
on such page of such service, as determined by the Agent from time to
time, for purposes of providing quotations of interest rates applicable to U.S.
dollar deposits in the London interbank market) is unavailable, the Eurodollar
Rate for any Interest Period for each Eurodollar Rate Advance comprising part
of the same Revolving Credit Borrowing shall be determined by the Agent on the
basis of applicable rates furnished to and received by the Agent from the
Reference Banks two Business Days before the first day of such Interest Period,
subject, however, to the provisions of Section 2.09.


 


“Eurodollar
Rate Advance” means a Revolving Credit Advance that bears interest as
provided in Section 2.08(a)(ii).


 


“Events of
Default” has the meaning specified in Section 6.01.


 


5





















 


“Extension Date”
has the meaning specified in Section 2.20(b).


 


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


 


“Fixed Rate
Advances” has the meaning specified in Section 2.04(a)(i).


 


“GAAP”
has the meaning specified in Section 1.03.


 


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


 


“Increase
Date” has the meaning specified in Section 2.19(a).


 


“Increasing
Lender” has the meaning specified in Section 2.19(b).


 


“Information
Memorandum” means the Confidential Information Memorandum dated May 2005
used by the Agent in connection with the syndication of the Commitments.


 


“Insurance Subsidiary”
means any Subsidiary of the Borrower that is licensed by any governmental
authority to engage in the insurance business by issuing insurance policies or
entering into reinsurance agreements.


 


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


 


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


 


(b)           Interest Periods commencing on the
same date for Eurodollar Rate Advances comprising part of the same Revolving
Credit Borrowing or for LIBO Rate Advances comprising part of the same
Competitive Bid Borrowing shall be of the same duration;


 


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


 


6





















 


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


 


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


 


“Invested
Assets” means cash, cash equivalents, short term investments, investments
held for sale and any other assets which are treated as investments under GAAP.


 


“Issuance”
with respect to any Letter of Credit means the issuance, amendment (to the
extent that same increases the Available Amount thereunder), renewal or
extension of such Letter of Credit.


 


“Issuing Bank” means an Initial Issuing Bank or
any Lender designated as an “Issuing Bank” hereunder by written notice to such
effect to the Agent by the Borrower and such Lender so long as such Lender
expressly agrees to perform in accordance with their terms all of the
obligations that by the terms of this Agreement are required to be performed by
it as an Issuing Bank and notifies the Agent of its Applicable Lending Office
(which information shall be recorded by the Agent in the Register).


 


“L/C Related Documents” has the meaning
specified in Section 2.07(b)(i).


 


“L/C Securities Account” means a securities
account to be established and maintained by the Borrower with the Agent or
another financial institution selected by the Borrower, over which the Agent
shall have control (as such term is defined in the Uniform Commercial Code),
upon terms as may be reasonably satisfactory to the Agent and the Borrower.


 


“Lenders”
means each Initial Lender, each Issuing Bank, each Assuming Lender that shall
become a party hereto pursuant to Section 2.19 or 2.20 and each Person
that shall become a party hereto pursuant to Section 8.07.


 


“Letter of
Credit” has the meaning specified in Section 2.01(b).


 


“Letter of Credit
Agreement” has the meaning specified in Section 2.03(a).


 


“Letter of Credit Commitment” means, with
respect to each Issuing Bank, the obligation of such Issuing Bank to issue
Letters of Credit for the account of the Borrower and their specified
Subsidiaries in (a) the amount set forth opposite the Issuing Bank’s name
on the signature pages hereof or (b)in the notice designating such Issuing
Bank as an Issuing Bank hereunder, in each case as such amount may be reduced
prior to such time pursuant to Section 2.06.


 


“Letter of Credit
Facility” means, at any time, an amount equal to the least of (a) the
aggregate amount of the Issuing Banks’ Letter of Credit Commitments at such
time, (b) $250,000,000 and (c) the aggregate amount of the Revolving
Credit Commitments, as such amount may be reduced at or prior to such time
pursuant to Section 2.06.


 


“LIBO Rate”
means, for any Interest Period for all LIBO Rate Advances comprising part of
the same Competitive Bid Borrowing, an interest rate per annum equal to the
rate per annum (rounded upward to the nearest whole multiple of 1/16 of 1% per
annum) appearing on Moneyline Telerate Markets Page 3750 (or any successor
or substitute page of such service, or any successor to such service,
providing rate quotations comparable to those currently provided on such page of
such service, as determined by the Agent from time to time, for purposes of providing
quotations of interest rates applicable to U.S. dollar deposits in the London
interbank market) as the London interbank offered rate for deposits in U.S.
dollars


 


7





















 


at approximately 11:00 A.M. (London
time) two Business Days prior to the first day of such Interest Period for a
term comparable to such Interest Period or, if for any reason such rate is not
available, the average (rounded upward to the nearest whole multiple of
1/16 of 1% per annum, if such average is not such a multiple) of the rate per
annum at which deposits in U.S. dollars offered by the principal office of each
of the Reference Banks in London, England to prime banks in the London
interbank market at 11:00 A.M. (London time) two Business Days before the
first day of such Interest Period in an amount substantially equal to the
amount that would be the Reference Banks’ respective ratable shares of such
Borrowing if such Borrowing were to be a Revolving Credit Borrowing to be
outstanding during such Interest Period and for a period equal to such Interest
Period. If the Moneyline Telerate Markets Page 3750 (or any successor or
substitute page of such service, or any successor to such service,
providing rate quotations comparable to those currently provided on such page of
such service, as determined by the Agent from time to time, for purposes of
providing quotations of interest rates applicable to U.S. dollar deposits in
the London interbank market) is unavailable, the LIBO Rate for any Interest
Period for each LIBO Rate Advance comprising part of the same Competitive Bid
Borrowing shall be determined by the Agent on the basis of applicable rates
furnished to and received by the Agent from the Reference Banks two Business
Days before the first day of such Interest Period, subject, however,
to the provisions of Section 2.09.


 


“LIBO Rate
Advances” means a Competitive Bid Advance bearing interest based on the
LIBO Rate.


 


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


 


“Mandatory
Convertible Securities” means, as of any date, the Borrower’s 5 1/4% Senior
Notes issued July 31, 2002, which require investors therein to purchase
shares of the Borrower’s common stock on the settlement date of August 16,
2005. If at any date, the Borrower issues additional debt that is mandatorily
convertible into common equity, such debt will be Mandatory Convertible
Securities under this definition if the Borrower provides satisfactory evidence
to the Agent and the Required Lenders that such debt is afforded equity capital
credit by S&P.


 


“Material
Adverse Change” means any material adverse change in the business,
financial condition or results of operations of the Borrower and its
Subsidiaries taken as a whole.


 


“Material
Adverse Effect” means a material adverse effect on (a) the business,
financial condition or operations of the Borrower and its Subsidiaries taken as
a whole, (b) the legality, validity or enforceability of this Agreement or
any Note or (c) the ability of the Borrower to perform its payment
obligations under this Agreement or any Note.


 


“Moody’s”
means Moody’s Investors Service, Inc.


 


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


 


“Multiple
Employer Plan” means, at a particular time, a single employer plan, as
defined in Section 4001(a)(15) of ERISA, (a) that is maintained for
employees of the Borrower or any ERISA Affiliate and at least one contributing
sponsor of such plan is a Person other than the Borrower and the ERISA
Affiliates or (b) in respect of which the Borrower or any ERISA Affiliate
would under Section 4064 or 4069 of ERISA be deemed to be a “contributing
sponsor” as defined in Section 4001(a)(13) of ERISA if such plan were
terminated at such time.


 


“Net Worth”
of the Borrower means, as of any date, its total shareholders’ equity
determined in accordance with GAAP plus (a) the amount of Trust
Preferred Securities to the extent that the amount of


 


8





















 


Trust Preferred Securities do not exceed 15%
of Total Capital plus (b) the amount of Mandatory Convertible
Securities to the extent that the amount of Mandatory Convertible Securities plus
Trust Preferred Securities do not in the aggregate exceed 25% of Total Capital.


 


“Non-Consenting
Lender” has the meaning specified in Section 2.20(b).


 


“Note”
means a Revolving Credit Note or a Competitive Bid Note.


 


“Notice of
Competitive Bid Borrowing” has the meaning specified in Section 2.04(a).


 


“Notice of
Issuance” has the meaning specified in Section 2.03(a).


 


“Notice of
Revolving Credit Borrowing” has the meaning specified in Section 2.02(a).


 


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


 


“Permitted
Liens” means:  (a) Liens for
taxes, assessments and governmental charges or levies to the extent not
required to be paid under Section 5.01(b) hereof; (b) Liens
imposed by law, such as materialmen’s, mechanics’, carriers’, workmen’s and
repairmen’s Liens and other similar Liens arising in the ordinary course of
business securing obligations that are not overdue for a period of more than 60
days; (c) pledges or deposits to secure obligations under workers’
compensation laws or similar legislation or to secure public or statutory
obligations; and (d) easements, rights of way and other encumbrances on
title to real property that do not render title to the property encumbered
thereby unmarketable or materially adversely affect the use of such property
for its present purposes.


 


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


 


“Plan”
means a Single Employer Plan or a Multiple Employer Plan.


 


“Primary
Policies” means any insurance policies issued by an Insurance Subsidiary.


 


“Public
Debt Rating” means, as of any date, the lowest rating that has been most
recently announced by either S&P or Moody’s, as the case may be, for any
class of non-credit enhanced long-term senior unsecured debt issued by the
Borrower. For purposes of the foregoing, (a) if only one of S&P and
Moody’s shall have in effect a Public Debt Rating, the Applicable Margin, the
Applicable Percentage and the Applicable Utilization Fee shall be determined by
reference to the available rating; (b) if neither S&P nor Moody’s
shall have in effect a Public Debt Rating, the Applicable Margin, the
Applicable Percentage and the Applicable Utilization Fee will be set in
accordance with Level 5 under the definition of “Applicable Margin”,
“Applicable Percentage” or “Applicable Utilization Fee”, as the
case may be; (c) if the ratings established by S&P and Moody’s shall
fall within different levels, the Applicable Margin, the Applicable Percentage
and the Applicable Utilization Fee shall be based upon the higher rating unless
such ratings differ by two or more levels, in which case the applicable level
will be one level above the lower of such levels; (d) if any rating
established by S&P or Moody’s shall be changed, such change shall be effective
as of the date on which such change is first announced publicly by the rating
agency making such change; and (e) if S&P or Moody’s shall change the
basis on which ratings are established, each reference to the Public Debt
Rating announced by S&P or Moody’s, as the case may be, shall refer to the
then equivalent rating by S&P or Moody’s, as the case may be.


 


“Public
Filings” means the public filings of the Borrower made on or prior to the
date of this Agreement.


 


9





















 


“Ratable Share” of any amount means, with
respect to any Lender at any time, the product of such amount times a
fraction the numerator of which is the amount of such Lender’s Revolving Credit
Commitment at such time (or, if the Revolving Credit Commitments shall have
been terminated pursuant to Section 2.06 or 6.01, such Lender’s Revolving
Credit Commitment as in effect immediately prior to such termination) and the
denominator of which is the aggregate amount of all Revolving Credit Commitments
at such time (or, if the Revolving Credit Commitments shall have been
terminated pursuant to Section 2.06 or 6.01, the aggregate amount of all
Revolving Credit Commitments as in effect immediately prior to such
termination).


 


“Reference
Banks” means Citibank, JPMorgan Chase Bank, N.A. and                       .


 


“Register”
has the meaning specified in Section 8.07(d).


 


“Reinsurance
Agreements” means any agreement, contract, treaty, certificate or other
arrangement whereby the Borrower or any Subsidiary agrees to assume from or
reinsure an insurer or reinsurer all or part of the liability of such insurer
or reinsurer under a policy or policies of insurance issued by such insurer or
reinsurer.


 


“Required
Lenders” means at any time Lenders owed more than 50% in interest of the
then aggregate unpaid principal amount of the Revolving Credit Advances owing
to Lenders, or, if no such principal amount is then outstanding, Lenders having
more than 50% of the Revolving Credit Commitments.


 


“Revolving
Credit Advance” means an advance by a Lender to the Borrower as part of a
Revolving Credit Borrowing and refers to a Base Rate Advance or a Eurodollar
Rate Advance (each of which shall be a “Type” of Revolving Credit
Advance).


 


“Revolving
Credit Borrowing” means a borrowing consisting of simultaneous Revolving
Credit Advances of the same Type made by each of the Lenders pursuant to Section 2.01.


 


“Revolving
Credit Commitment” means as to any Lender (a) the amount set forth
opposite such Lender’s name on the signature pages hereto as such Lender’s
“Revolving Credit Commitment”, (b) if such Lender has become a Lender
hereunder pursuant to an Assumption Agreement, the amount set forth in such
Assumption Agreement or (c) if such Lender has entered into an Assignment
and Acceptance, the amount set forth for such Lender in the Register maintained
by the Agent pursuant to Section 8.07(d), as such amount may be reduced
pursuant to Section 2.06 or increased pursuant to Section 2.19.


 


“Revolving
Credit Note” means a promissory note of the Borrower payable to the order
of any Lender, delivered pursuant to a request made under Section 2.17 in
substantially the form of Exhibit A-1 hereto, evidencing the aggregate
indebtedness of the Borrower to such Lender resulting from the Revolving Credit
Advances made by such Lender.


 


“S&P”
means Standard & Poor’s, a division of The McGraw-Hill Companies, Inc.


 


“Secured Letter of Credit” means a Letter of
Credit designated by the Borrower for which the Borrower maintains on deposit
in the L/C Securities Account cash and Permitted Investments (as defined
therein) in an amount equal to the Available Amount of such Letter of Credit. The
Borrower may by notice to the Agent from time to time pursuant to Section 2.03(f) designate
which outstanding Letters of Credit at such time shall be “Secured Letters of
Credit.”


 


“Significant
Subsidiary” means any Subsidiary that constitutes a “significant subsidiary”
under Regulation S-X promulgated by the Securities and Exchange Commission, as
in effect from time to time.


 


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“Single
Employer Plan” means, at a particular time, a single employer plan, as
defined in Section 4001(a)(15) of ERISA, (a) that is maintained for
employees of the Borrower or any ERISA Affiliate and no Person other than the
Borrower and the ERISA Affiliates is a contributing sponsor of such plan or (b) in
respect of which the Borrower or any ERISA Affiliate would under Section 4069
of ERISA be deemed to be a “contributing sponsor” as defined in Section 4001(a)(13)
of ERISA if such plan were terminated at such time.


 


“St. Paul
Fire” means St. Paul Fire and Marine Insurance Company, a Minnesota
corporation.


 


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


 


“Termination
Date” means the earlier of (a) June 10, 2010, subject to the
extension thereof pursuant to Section 2.20 and (b) the date of
termination in whole of the Commitments pursuant to Section 2.06 or 6.01; provided,
however, that the Termination Date of any Lender that is a
Non-Consenting Lender to any requested extension pursuant to Section 2.20
shall be the Termination Date in effect immediately prior to the applicable
Extension Date for all purposes of this Agreement.


 


“Total
Capital” means the sum, without duplication, of (a) all items that
would, in accordance with GAAP, be classified as indebtedness on a Consolidated
balance sheet of the Borrower and its consolidated Subsidiaries, (b) total
Consolidated shareholders’ equity of the Borrower and its consolidated
Subsidiaries determined in accordance with GAAP, (c) Trust Preferred
Securities and (d) Mandatory Convertible Securities.


 


“Total
Consolidated Debt” means, as of any date, all items that, in accordance
with GAAP, would be classified as indebtedness on a Consolidated balance sheet
of the Borrower and its consolidated Subsidiaries, provided that (a) Total
Consolidated Debt shall not include any indebtedness represented by Trust
Preferred Securities except to the extent that such Securities (other than
those convertible to equity) exceed 15% of Total Capital and (b) Total
Consolidated Debt shall not include any indebtedness represented by Mandatory
Convertible Securities except to the extent that such Mandatory Convertible
Securities plus Trust Preferred Securities exceed 25% of Total Capital; provided
however, that in the event 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 constitute indebtedness thereafter.


 


“Trust Preferred Securities” means, as of any
date, all items in respect of trust preferred securities that would, in
accordance with GAAP, be classified under Debt on a Consolidated balance sheet
(or the footnotes thereto) of the Borrower and its consolidated Subsidiaries.


 


“Unissued
Letter of Credit Commitment” means, with respect to any Issuing Bank, the
obligation of such Issuing Bank to issue Letters of Credit for the account of
the Borrower or its specified Subsidiaries in an amount equal to the excess of (a) the
amount of its Letter of Credit Commitment over (b) the aggregate Available
Amount of all Letters of Credit issued by such Issuing Bank.


 


“Unused
Commitment” means, with respect to each Lender at any time, (a) such
Lender’s Revolving Credit Commitment at such time minus (b) the sum
of (i) the aggregate principal amount of all Revolving Credit Advances
made by such Lender (in its capacity as a Lender) and outstanding at such time,
plus (ii) such Lender’s Ratable Share of (A) the aggregate
Available Amount of all the Letters of Credit outstanding at such time, (B) the
aggregate principal amount of all Revolving Credit Advances made


 


11





















 


by each Issuing Bank pursuant to Section 2.03(c) that
have not been ratably funded by such Lender and outstanding at such time and (C) the
aggregate principal amount of all Competitive Bid Advances then outstanding.


 


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


 


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


 


SECTION 1.03. Accounting Terms. All
accounting terms not specifically defined herein shall be construed in
accordance with generally accepted accounting principles consistent with those
applied in the preparation of the financial statements referred to in Section 4.01(e) (“GAAP”);
provided that, if the Borrower notifies the Agent that the Borrower requests
an amendment to any provision hereof to eliminate the effect of any change
occurring after the date hereof in GAAP or in the application thereof on the
operation of such provision (or if the Agent notifies the Borrower that the
Required Lenders request an amendment to any provision hereof for such
purpose), regardless of whether any such notice is given before or after such
change in GAAP or in the application thereof, then such provision shall be
interpreted on the basis of GAAP as in effect and applied immediately before
such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith.


 


ARTICLE II


 


AMOUNTS AND TERMS OF THE
ADVANCES AND LETTERS OF CREDIT


 


SECTION 2.01. The Revolving Credit Advances
and Letters of Credit. (a)  Revolving Credit Advances. Each
Lender severally agrees, on the terms and conditions hereinafter set forth, to
make Revolving Credit Advances to the Borrower from time to time on any
Business Day during the period from the Effective Date until the Termination
Date in an amount not to exceed such Lender’s Unused Commitment (immediately
prior to the making of such Revolving Credit Advance). Each Revolving Credit
Borrowing shall be in an aggregate amount of $10,000,000 or an integral
multiple of $1,000,000 in excess thereof and shall consist of Revolving Credit
Advances of the same Type made, or continued as or converted into Eurodollar
Rate Advances, on the same day by the Lenders ratably according to their respective
Revolving Credit Commitments. Within the limits of each Lender’s Revolving
Credit Commitment, the Borrower may borrow under this Section 2.01(a),
prepay pursuant to Section 2.11 and reborrow under this Section 2.01(a).


 


(b)           Letters of Credit. Each Issuing
Bank agrees, on the terms and conditions hereinafter set forth, in reliance
upon the agreements of the other Lenders set forth in this Agreement, to issue
letters of credit (each, a “Letter
of Credit”) for the account of the Borrower and its specified Subsidiaries
from time to time on any Business Day during the period from the Effective Date
until 30 days before the Termination Date in an aggregate Available Amount (i) for
all Letters of Credit not to exceed at any time the Letter of Credit Facility
at such time, (ii) for all Letters of Credit issued by each Issuing Bank
not to exceed at any time such Issuing Bank’s Letter of Credit Commitment at
such time and (iii) for each such Letter of Credit not to exceed an amount
equal to the Unused Commitments (immediately prior to such Issuance) of the
Lenders at such time. No Letter of Credit shall have an expiration date
(including all rights of the Borrower or the beneficiary to require renewal)
later than five Business Days before the Termination Date. Within the limits
referred to above, the Borrower may from time to time request the Issuance of
Letters of Credit under this Section 2.01(b). Each letter of credit listed
on Schedule 2.01(b) shall be deemed to constitute a Letter of Credit
issued hereunder, and each Lender that is an issuer of such a Letter of Credit
shall, for purposes of Section 2.03, be deemed to be an Issuing Bank for
each such letter of credit, provided that renewal or replacement of any
such letter of credit shall not be Letters of Credit under this Agreement
unless such renewal or replacement is issued by an Issuing Bank (other than
Issuing Banks solely by operation of this sentence) pursuant to the terms of
this Agreement.


 


12





















 


SECTION 2.02. Making the Revolving Credit
Advances. (a)  Except as otherwise provided in Section 2.03(c),
each Revolving Credit Borrowing shall be made on notice, given not later than
(x) 11:00 A.M. (New York City time) on the third Business Day
prior to the date of the proposed Revolving Credit Borrowing in the case of a
Revolving Credit Borrowing consisting of Eurodollar Rate Advances or (y) 11:00 A.M.
(New York City time) on the date of the proposed Revolving Credit Borrowing in
the case of a Revolving Credit Borrowing consisting of Base Rate Advances, by
the Borrower to the Agent, which shall give to each Lender prompt notice
thereof by telecopier. Each such notice of a Revolving Credit Borrowing (a “Notice
of Revolving Credit Borrowing”) shall be by telephone, confirmed
immediately in writing, or telecopier in substantially the form of Exhibit B-1
hereto, specifying therein the requested (i) date of such Revolving Credit
Borrowing, (ii) Type of Advances comprising such Revolving Credit
Borrowing, (iii) aggregate amount of such Revolving Credit Borrowing, and (iv) in
the case of a Revolving Credit Borrowing consisting of Eurodollar Rate
Advances, initial Interest Period for each such Revolving Credit Advance. Each
Lender shall, before 1:00 P.M. (New York City time) on the date of
such Revolving Credit Borrowing make available for the account of its
Applicable Lending Office to the Agent at the Agent’s Account, in same day
funds, such Lender’s ratable portion of such Revolving Credit Borrowing. After
the Agent’s receipt of such funds and upon fulfillment of the applicable
conditions set forth in Article III, the Agent will promptly make such
funds available to the Borrower at the Agent’s address referred to in Section 8.02.


 


(b)           Anything in subsection (a) above
to the contrary notwithstanding, (i) the Borrower may not select
Eurodollar Rate Advances for any Revolving Credit Borrowing if the aggregate
amount of such Revolving Credit Borrowing is less than $10,000,000 or if the
obligation of the Lenders to make Eurodollar Rate Advances shall then be
suspended pursuant to Section 2.09 or 2.13 and (ii) the Eurodollar
Rate Advances may not be outstanding as part of more than twelve separate
Revolving Credit Borrowings.


 


(c)           In the case of any Revolving Credit
Borrowing that the related Notice of Revolving Credit Borrowing specifies is to
be comprised of Eurodollar Rate Advances, the Borrower shall indemnify each
Lender against any loss, cost or expense incurred by such Lender as a result of
any failure of the Borrower to borrow such funds on the date specified in such
Notice of Revolving Credit Borrowing, whether as a result of any failure to
fulfill on or before the date specified in such Notice of Revolving Credit
Borrowing for such Revolving Credit Borrowing the applicable conditions set
forth in Section 3.02 or otherwise, including, without limitation, any
loss (excluding loss of anticipated profits), cost or expense incurred by
reason of the liquidation or reemployment of deposits or other funds acquired
by such Lender to fund the Revolving Credit Advance to be made by such Lender
as part of such Revolving Credit Borrowing when such Revolving Credit Advance,
as a result of such failure, is not made on such date.


 


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


 


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


 


13





















 


SECTION 2.03. Issuance
of and Drawings and Reimbursement Under Letters of Credit. (a) 
Request for Issuance. (i) Each Letter of Credit shall be issued upon
notice, given not later than 11:00 A.M. (New York City time) on the
fifth Business Day prior to the date of the proposed Issuance of such Letter of
Credit (or on such shorter notice as the applicable Issuing Bank may agree), by
the Borrower to any Issuing Bank, and such Issuing Bank shall give the Agent,
prompt notice thereof. Each such notice by the Borrower of Issuance of a Letter
of Credit (a “Notice of Issuance”) shall be by telecopier or
telephone, confirmed immediately in writing, specifying therein the requested (A) date
of such Issuance (which shall be a Business Day), (B) Available Amount of
such Letter of Credit, (C) expiration date of such Letter of Credit (which
shall not be later than 10 Business Days before the Termination Date), (D) name
and address of the beneficiary of such Letter of Credit and (E) form of
such Letter of Credit. Such Letter of Credit shall be issued pursuant to such
application and agreement for letter of credit as such Issuing Bank and the
Borrower shall agree for use in connection with such requested Letter of Credit
(a “Letter of Credit Agreement”). If the requested form of such Letter
of Credit is acceptable to such Issuing Bank in its reasonable discretion (it
being understood that any such form shall have only explicit documentary
conditions to draw and shall not include discretionary conditions), such Issuing
Bank will, upon fulfillment of the applicable conditions set forth in Section 3.02,
make such Letter of Credit available to the Borrower at its office referred to
in Section 8.02 or as otherwise agreed with the Borrower in connection
with such Issuance. In the event and to the extent that the provisions of any
Letter of Credit Agreement shall conflict with this Agreement, the provisions
of this Agreement shall govern (and in no event shall any provision of any such
Letter of Credit Agreement regarding representations, warranties, covenants,
events of default, set-off rights or collateral be effective).


 


(b)           Participations.
By the Issuance of a Letter of Credit (or an amendment to a Letter of Credit
increasing or decreasing the amount thereof) and without any further action on
the part of the applicable Issuing Bank or the Lenders, such Issuing Bank
hereby grants to each Lender, and each Lender hereby acquires from such Issuing
Bank, a participation in such Letter of Credit equal to such Lender’s Ratable
Share of the Available Amount of such Letter of Credit. The Borrower hereby
agrees to each such participation. Each Lender acknowledges and agrees that its
obligation to acquire participations pursuant to this paragraph in respect of
Letters of Credit is absolute and unconditional and shall not be affected by
any circumstance whatsoever, including any amendment, renewal or extension of
any Letter of Credit or the occurrence and continuance of a Default or
reduction or termination of the Revolving Credit Commitments, and that each
such payment shall be made without any offset, abatement, withholding or
reduction whatsoever. Each Lender further acknowledges and agrees that its
participation in each Letter of Credit will be automatically adjusted to
reflect such Lender’s Ratable Share of the Available Amount of such Letter of
Credit at each time such Lender’s Revolving Credit Commitment is amended
pursuant to a Commitment Increase in accordance with Section 2.19, an
assignment in accordance with Section 8.07 or otherwise pursuant to this
Agreement.


 


(c)           Drawing
and Reimbursement. The payment by an Issuing Bank of a draft drawn under
any Letter of Credit which is not reimbursed by the Borrower prior to 1:00 P.M.
(New York City time) on the date made shall constitute for all purposes of this
Agreement the making by any such Issuing Bank of a Revolving Credit Advance,
which shall be a Base Rate Advance, in the amount of such draft, without regard
to whether the making of such a Revolving Credit Advance would exceed such
Issuing Bank’s Unused Commitment (it being understood that such Issuing Bank
shall use its best efforts to notify the Borrower of any drawing prior to 12:00
noon (New York City time) on the date such drawing is made). Each Issuing Bank
shall give prompt notice of each drawing under any Letter of Credit issued by
it to the Borrower and the Agent. Upon written demand by such Issuing Bank or
by the Borrower, with a copy of such demand to the Agent (in the case of any
notice issued by the Issuing Bank) and the Borrower, each Lender shall pay to
the Agent, for the account of the relevant Issuing Bank, such Lender’s Ratable
Share of such outstanding Revolving Credit Advance pursuant to Section 2.03(b).
Each Lender acknowledges and agrees that its obligation to make Revolving
Credit Advances pursuant to this paragraph in respect of Letters of Credit is
absolute and unconditional and shall not be affected by any circumstance
whatsoever, including any amendment, renewal or extension of any Letter of
Credit or the occurrence and continuance of a Default or reduction or
termination of the Revolving Credit Commitments, and that each such payment
shall be made without any offset, abatement, withholding or reduction
whatsoever. Promptly after receipt thereof, the Agent shall transfer such funds
to such Issuing Bank. Each Lender agrees to fund its Ratable Share of an
outstanding Revolving Credit Advance on (i) the Business Day on which
demand therefor is made by such Issuing Bank or the Borrower, as the case may
be, provided that notice of such demand is given not later than 11:00 A.M.
(New York City time) on such Business Day, or (ii) the first Business
Day next succeeding such demand if notice of such demand is given after such
time. If and to the extent that any Lender shall not have so made the amount of
such


 


14





















 


Advance available to the Agent, such Lender agrees to pay to the Agent
forthwith on demand such amount together with interest thereon, for each day
from the date of demand by any such Issuing Bank until the date such amount is
paid to the Agent, at the Federal Funds Rate for its account or the account of
such Issuing Bank, as applicable. If such Lender shall pay to the Agent such
amount for the account of any such Issuing Bank on any Business Day, such
amount so paid in respect of principal shall constitute a Revolving Credit
Advance made by such Lender on such Business Day for purposes of this
Agreement, and the outstanding principal amount of the Revolving Credit Advance
made by such Issuing Bank shall be reduced by such amount on such Business Day.


 


(d)           Letter
of Credit Reports. Each Issuing Bank shall furnish (A) to the Agent
(with a copy to the Borrower) on the first Business Day of each month a written
report summarizing Issuance and expiration dates of Letters of Credit issued by
such Issuing Bank during the preceding month and drawings during such month
under all Letters of Credit and (B) to the Agent (with a copy to the
Borrower) on the first Business Day of each calendar quarter a written report
setting forth the average daily aggregate Available Amount during the preceding
calendar quarter of all Letters of Credit issued by such Issuing Bank.


 


(e)           Failure to Make Advances. The
failure of any Lender to make the Revolving Credit Advance to be made by it on
the date specified in Section 2.03(c) shall not relieve any other
Lender of its obligation hereunder to make its Revolving Credit Advance on such
date, but no Lender shall be responsible for the failure of any other Lender to
make the Revolving Credit Advance to be made by such other Lender on such date.


 


(f)            Secured Letters of Credit. The
Borrower may from time to time designate any Letter of Credit to be a Secured
Letter of Credit by notice to the Agent (with a copy to the applicable Issuing
Bank). Upon the drawing of any Secured Letter of Credit, to the extent cash
and/or Permitted Investments are on deposit in the L/C Securities Account, such
cash and/or Permitted Investments shall, at the Borrower’s option, be applied
to reimburse the applicable Issuing Bank to the extent permitted by applicable
law and to the extent the Borrower elects not to reimburse such drawing (to
avoid liquidating Permitted Investments) as provided in Section 2.03(c). Subject
to Section 6.02, to the extent any Secured Letters of Credit shall have
expired or been drawn upon, any excess amounts in such L/C Securities Account
shall be returned to the Borrower at the Borrower’s request.


 


SECTION 2.04. The Competitive Bid Advances.
(a)  Each Lender severally agrees that the Borrower may make Competitive
Bid Borrowings under this Section 2.04 from time to time on any Business
Day during the period from the date hereof until the date occurring 35 days
prior to the Termination Date in the manner set forth below; provided
that each Competitive Bid Borrowing shall not exceed the aggregate amount of
the Unused Commitments of the Lenders immediately prior to the making of such
Competitive Bid Borrowing.


 


(i)            The Borrower may request a
Competitive Bid Borrowing under this Section 2.04 by delivering to the
Agent, by telecopier, a notice of a Competitive Bid Borrowing (a “Notice of
Competitive Bid Borrowing”), in substantially the form of Exhibit B-2
hereto, specifying therein the requested (v) date of such proposed
Competitive Bid Borrowing, (w) aggregate amount of such proposed Competitive
Bid Borrowing, (x) in the case of a Competitive Bid Borrowing consisting of
LIBO Rate Advances, Interest Period, or in the case of a Competitive Bid
Borrowing consisting of Fixed Rate Advances, maturity date for repayment of
each Fixed Rate Advance to be made as part of such Competitive Bid Borrowing
(which maturity date may not be earlier than the date occurring seven days
after the date of such Competitive Bid Borrowing or later than the earlier of
(I) 180 days after the date of such Competitive Bid Borrowing and (II) the
Termination Date), (y) interest payment date or dates relating thereto, and (z)
other terms (if any) to be applicable to such Competitive Bid Borrowing, not
later than 10:00 A.M. (New York City time) (A) at least one Business
Day prior to the date of the proposed Competitive Bid Borrowing, if the
Borrower shall specify in the Notice of Competitive Bid Borrowing that the
rates of interest to be offered by the Lenders shall be fixed rates per annum
(the Advances comprising any such Competitive Bid Borrowing being referred to
herein as “Fixed Rate Advances”) and (B) at least four Business
Days prior to the date of the proposed Competitive Bid Borrowing, if the
Borrower shall instead specify in the Notice of Competitive Bid Borrowing that
the Advances comprising such Competitive Bid Borrowing shall be LIBO Rate
Advances. Each Notice of Competitive Bid Borrowing shall be irrevocable and
binding on the Borrower. The Agent shall in turn promptly notify each Lender of
each request for a Competitive Bid Borrowing


 


15





















 


received by it from the Borrower by sending
such Lender a copy of the related Notice of Competitive Bid Borrowing.


 


(ii)           Each Lender may, if, in its sole
discretion, it elects to do so, irrevocably offer to make one or more
Competitive Bid Advances to the Borrower as part of such proposed Competitive
Bid Borrowing at a rate or rates of interest specified by such Lender in its
sole discretion, by notifying the Agent (which shall give prompt notice thereof
to the Borrower), (A) before 9:30 A.M. (New York City time) on
the date of such proposed Competitive Bid Borrowing, in the case of a
Competitive Bid Borrowing consisting of Fixed Rate Advances and (B) before
10:00 A.M. (New York City time) three Business Days before the date of
such proposed Competitive Bid Borrowing, in the case of a Competitive Bid
Borrowing consisting of LIBO Rate Advances of the minimum amount and maximum
amount of each Competitive Bid Advance which such Lender would be willing to
make as part of such proposed Competitive Bid Borrowing (which amounts may,
subject to the proviso to the first sentence of this Section 2.04(a),
exceed such Lender’s Commitment, if any), the rate or rates of interest
therefor and such Lender’s Applicable Lending Office with respect to such
Competitive Bid Advance; provided that if the Agent in its capacity as a
Lender shall, in its sole discretion, elect to make any such offer, it shall
notify the Borrower of such offer at least 30 minutes before the time and on
the date on which notice of such election is to be given to the Agent, by the
other Lenders. If any Lender shall elect not to make such an offer, such Lender
shall so notify the Agent before 10:00 A.M. (New York City time) on
the date on which notice of such election is to be given to the Agent by the
other Lenders, and such Lender shall not be obligated to, and shall not, make
any Competitive Bid Advance as part of such Competitive Bid Borrowing; provided
that the failure by any Lender to give such notice shall not cause such Lender
to be obligated to make any Competitive Bid Advance as part of such proposed
Competitive Bid Borrowing.


 


(iii)          The Borrower shall, in turn, (A) before
10:30 A.M. (New York City time) on the date of such proposed
Competitive Bid Borrowing, in the case of a Competitive Bid Borrowing
consisting of Fixed Rate Advances and (B) before 11:00 A.M.
(New York City time) three Business Days before the date of such proposed
Competitive Bid Borrowing, in the case of a Competitive Bid Borrowing
consisting of LIBO Rate Advances, either:


 


(x)            cancel such Competitive Bid
Borrowing by giving the Agent notice to that effect, or


 


(y)           accept one or more of the offers made
by any Lender or Lenders pursuant to paragraph (ii) above, in its sole
discretion, by giving notice to the Agent of the amount of each Competitive Bid
Advance (which amount shall be equal to or greater than the minimum amount, and
equal to or less than the maximum amount, notified to the Borrower by the Agent
on behalf of such Lender for such Competitive Bid Advance pursuant to paragraph
(ii) above) to be made by each Lender as part of such Competitive Bid
Borrowing, and reject any remaining offers made by Lenders pursuant to
paragraph (ii) above by giving the Agent notice to that effect. The
Borrower shall accept the offers made by any Lender or Lenders to make
Competitive Bid Advances in order of the lowest to the highest rates of
interest offered by such Lenders. If two or more Lenders have offered the same
interest rate, the amount to be borrowed at such interest rate will be
allocated among such Lenders in proportion to the amount that each such Lender
offered at such interest rate.


 


(iv)          If the Borrower notifies the Agent
that such Competitive Bid Borrowing is cancelled pursuant to
paragraph (iii)(x) above, the Agent shall give prompt notice thereof to
the Lenders and such Competitive Bid Borrowing shall not be made.


 


(v)           If the Borrower accepts one or more
of the offers made by any Lender or Lenders pursuant to paragraph (iii)(y)
above, the Agent shall in turn promptly notify (A) each Lender that has
made an offer as described in paragraph (ii) above, of the date and
aggregate amount of such Competitive Bid Borrowing and whether or not any offer
or offers made by such Lender pursuant to paragraph (ii) above


 


16





















 


have been accepted by the Borrower, (B) each
Lender that is to make a Competitive Bid Advance as part of such Competitive
Bid Borrowing, of the amount of each Competitive Bid Advance to be made by such
Lender as part of such Competitive Bid Borrowing, and (C) each Lender that
is to make a Competitive Bid Advance as part of such Competitive Bid Borrowing,
upon receipt, that the Agent has received forms of documents appearing to
fulfill the applicable conditions set forth in Section 3.03. Each Lender
that is to make a Competitive Bid Advance as part of such Competitive Bid Borrowing
shall, before 12:00 noon (New York City time) on the date of such
Competitive Bid Borrowing specified in the notice received from the Agent
pursuant to clause (A) of the preceding sentence or any later time
when such Lender shall have received notice from the Agent pursuant to
clause (C) of the preceding sentence, make available for the account
of its Applicable Lending Office to the Agent at the Agent’s Account, in same
day funds, such Lender’s portion of such Competitive Bid Borrowing. Upon
fulfillment of the applicable conditions set forth in Section 3.03 and
after receipt by the Agent of such funds, the Agent will make such funds
available to the Borrower at the Agent’s address referred to in Section 8.02.
Promptly after each Competitive Bid Borrowing the Agent will notify each Lender
of the amount and tenor of the Competitive Bid Borrowing.


 


(vi)          If the Borrower notifies the Agent
that it accepts one or more of the offers made by any Lender or Lenders
pursuant to paragraph (iii)(y) above, such notice of acceptance shall be
irrevocable and binding on the Borrower. The Borrower shall indemnify each
Lender against any loss, cost or expense incurred by such Lender as a result of
any failure to fulfill on or before the date specified in the related Notice of
Competitive Bid Borrowing for such Competitive Bid Borrowing the applicable
conditions set forth in Section 3.03, including, without limitation, any
loss (excluding loss of anticipated profits), cost or expense incurred by
reason of the liquidation or reemployment of deposits or other funds acquired
by such Lender to fund the Competitive Bid Advance to be made by such Lender as
part of such Competitive Bid Borrowing when such Competitive Bid Advance, as a
result of such failure, is not made on such date.


 


(b)           Each Competitive Bid Borrowing shall
be in an aggregate amount of $10,000,000 or an integral multiple of $1,000,000
in excess thereof and, following the making of each Competitive Bid Borrowing,
the Borrower shall be in compliance with the limitation set forth in the
proviso to the first sentence of subsection (a) above.


 


(c)           Within the limits and on the
conditions set forth in this Section 2.04, the Borrower may from time to
time borrow under this Section 2.04, repay or prepay pursuant to subsection (d) below,
and reborrow under this Section 2.04, provided that a Competitive
Bid Borrowing shall not be made within three Business Days of the date of any
other Competitive Bid Borrowing.


 


(d)           The Borrower shall repay to the Agent
for the account of each Lender that has made a Competitive Bid Advance, on the
maturity date of each Competitive Bid Advance (such maturity date being that
specified by the Borrower for repayment of such Competitive Bid Advance in the
related Notice of Competitive Bid Borrowing delivered pursuant to subsection

(a)(i) above and provided in the Competitive Bid Note evidencing such
Competitive Bid Advance), the then unpaid principal amount of such Competitive
Bid Advance. The Borrower shall have no right to prepay any principal amount of
any Competitive Bid Advance unless, and then only on the terms, specified by
the Borrower for such Competitive Bid Advance in the related Notice of
Competitive Bid Borrowing delivered pursuant to subsection (a)(i) above
and set forth in the Competitive Bid Note evidencing such Competitive Bid
Advance.


 


(e)           The Borrower shall pay interest on
the unpaid principal amount of each Competitive Bid Advance from the date of
such Competitive Bid Advance to the date the principal amount of such
Competitive Bid Advance is repaid in full, at the rate of interest for such
Competitive Bid Advance specified by the Lender making such Competitive Bid
Advance in its notice with respect thereto delivered pursuant to subsection (a)(ii) above,
payable on the interest payment date or dates specified by the Borrower for
such Competitive Bid Advance in the related Notice of Competitive Bid Borrowing
delivered pursuant to subsection (a)(i) above, as provided in the
Competitive Bid Note evidencing such Competitive Bid Advance. Upon the
occurrence and during the continuance of an Event of Default, the Borrower
shall pay interest on the amount of unpaid principal of and interest on each
Competitive Bid Advance owing to a Lender, payable in arrears on the date or
dates interest is payable thereon, at a rate per annum equal at all times to
2% per annum above the rate per annum required to be paid on such


 


17





















 


Competitive Bid Advance under the terms of the Competitive Bid Note
evidencing such Competitive Bid Advance unless otherwise agreed in such
Competitive Bid Note.


 


(f)            The indebtedness of the Borrower
resulting from each Competitive Bid Advance made to the Borrower as part of a
Competitive Bid Borrowing shall be evidenced by a separate Competitive Bid Note
of the Borrower payable to the order of the Lender making such Competitive Bid
Advance.


 


SECTION 2.05. Fees. (a)  Facility
Fee. The Borrower agrees to pay to the Agent for the account of each Lender
a facility fee on the aggregate amount of such Lender’s Commitment from the
date hereof in the case of each Initial Lender and from the effective date
specified in the Assumption Agreement or in the Assignment and Acceptance
pursuant to which it became a Lender in the case of each other Lender until the
Termination Date at a rate per annum equal to the Applicable Percentage in
effect from time to time, payable in arrears quarterly on the last day of each
March, June, September and December, commencing June 30, 2005, and on
the Termination Date.


 


(b)           Letter of Credit Fees.
(i)  The Borrower shall pay to the Agent for the account of each Lender a
commission on such Lender’s Ratable Share of (A) the average daily
aggregate Available Amount of all Secured Letters of Credit issued and
outstanding from time to time at a rate per annum equal to (x) the
Applicable Margin for Eurodollar Rate Advances in effect from time to time
during such calendar quarter minus (y) 0.10% and (B) the average
daily aggregate Available Amount of all other Letters of Credit issued and
outstanding from time to time at a rate per annum equal to the Applicable
Margin for Eurodollar Rate Advances in effect from time to time during such
calendar quarter, in each case payable in arrears quarterly on the last day of
each March, June, September and December, commencing June 30, 2005,
and on the Termination Date; provided that the amount of such commission
in respect of Letters of Credit (other than Secured Letters of Credit) shall be
increased (without duplication of amounts otherwise payable under Section 2.08(b))
by 2% per annum if the Borrower is required to pay default interest pursuant to
Section 2.08(b).


 


(ii)           The Borrower shall pay to each
Issuing Bank, for its own account, a fronting fee and such other commissions,
issuance fees, transfer fees and other fees and charges in connection with the
Issuance or administration of each Letter of Credit as the Borrower and such
Issuing Bank shall agree.


 


(c)           Agent’s Fees. The Borrower
shall pay to the Agent for its own account such fees as may from time to time
be agreed between the Borrower and the Agent.


 


SECTION 2.06. Optional Termination or
Reduction of the Commitments. The Borrower shall have the right, upon at
least three Business Days’ notice to the Agent, to terminate in whole or
permanently reduce ratably in part the Unused Commitments or the Unissued
Letter of Credit Commitments of the Lenders, provided that each partial
reduction shall be in the aggregate amount of $10,000,000 or an integral
multiple of $1,000,000 in excess thereof; provided further that a notice
of termination of the Commitments delivered by the Borrower may state that such
notice is conditioned upon the effectiveness of other credit facilities, in
which case such notice may be revoked by the Borrower (by notice to the Agent
on or prior to the specified effective date) if such condition is not
satisfied.


 


SECTION 2.07. Repayment of Revolving Credit
Advances. (a) Revolving Credit Advances. The Borrower shall
repay to the Agent for the ratable account of the Lenders on the Termination
Date the aggregate principal amount of the Revolving Credit Advances then
outstanding.


 


(b)           Letter
of Credit Drawings. The obligation of the Borrower to reimburse drawings
under any Letter of Credit shall be unconditional and irrevocable, and shall be
paid strictly in accordance with the terms of this Agreement under all
circumstances, including, without limitation, the following circumstances (it
being understood that any such payment by the Borrower is without prejudice to,
and does not constitute a waiver of, any rights the Borrower might have or
might acquire as a result of the payment by any Lender of any draft or the
reimbursement by the Borrower thereof, including, without limitation, pursuant
to Section 8.12):


 


18





















 


(i)            any lack of
validity or enforceability of this Agreement, any Note, any Letter of Credit
Agreement, any Letter of Credit or any other agreement or instrument relating
thereto (all of the foregoing being, collectively, the “L/C Related
Documents”);


 


(ii)           any change in the
time, manner or place of payment of, or in any other term of, all or any of the
obligations of the Borrower in respect of any L/C Related Document or any other
amendment or waiver of or any consent to departure from all or any of the L/C
Related Documents;


 


(iii)          the existence of
any claim, set-off, defense or other right that the Borrower may have at any
time against any beneficiary or any transferee of a Letter of Credit (or any
Persons for which any such beneficiary or any such transferee may be acting),
any Issuing Bank, the Agent, any Lender or any other Person, whether in
connection with the transactions contemplated by the L/C Related Documents or
any unrelated transaction;


 


(iv)          any statement or any
other document presented under a 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;


 


(v)           payment by any
Issuing Bank under a Letter of Credit against presentation of a draft or certificate
that does not comply with the terms of such Letter of Credit;


 


(vi)          any exchange,
release or non-perfection of any collateral, or any release or amendment or
waiver of or consent to departure from any guarantee, for all or any of the
obligations of the Borrower in respect of the L/C Related Documents; or


 


(vii)         without prejudice to
the other provisions of this Agreement, any other circumstance or happening
whatsoever, whether or not similar to any of the foregoing, including, without
limitation, any other circumstance that might otherwise constitute a defense
available to, or a discharge of, the Borrower or a guarantor.


 


SECTION 2.08. Interest on Revolving Credit
Advances. (a)  Scheduled Interest. The Borrower shall pay
interest on the unpaid principal amount of each Revolving Credit Advance owing
to each Lender from the date of such Revolving Credit Advance until such
principal amount shall be paid in full, at the following rates per annum:


 


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


 


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


 


(b)           Default Interest. Upon the
occurrence and during the continuance of an Event of Default, the Agent may,
and upon the request of the Required Lenders shall, require the Borrower to pay
interest (“Default Interest”) on (i) the overdue and unpaid
principal amount of each Revolving Credit Advance owing to each Lender which is
not paid when due whether at stated maturity, upon acceleration or otherwise,
payable in arrears on the dates referred to in clause (a)(i) or (a)(ii) above,
at a rate per annum equal at all times to 2% per annum above the


 


19





















 


rate per annum required to be paid on such Revolving Credit Advance
pursuant to clause (a)(i) or (a)(ii) above and (ii) to the
fullest extent permitted by law, the amount of any interest, fee or other
amount payable hereunder that is not paid when due, from the date such amount
shall be due until such amount shall be paid in full, payable in arrears on the
date such amount shall be paid in full and on demand, at a rate per annum equal
at all times to 2% per annum above the rate per annum required to be paid on
Base Rate Advances pursuant to clause (a)(i) above, provided, however,
that following acceleration of the Advances pursuant to Section 6.01,
Default Interest shall accrue and be payable hereunder whether or not
previously required by the Agent.


 


SECTION 2.09. Interest Rate Determination.
(a)  Each Reference Bank agrees, if requested by the Agent, to furnish to
the Agent timely information for the purpose of determining each Eurodollar
Rate and each LIBO Rate. If any one or more of the Reference Banks shall not
furnish such timely information to the Agent for the purpose of determining any
such interest rate, the Agent shall determine such interest rate on the basis
of timely information furnished by the remaining Reference Banks. The Agent
shall give prompt notice to the Borrower and the Lenders of the applicable
interest rate determined by the Agent for purposes of Section 2.08(a)(i) or
(ii), and the rate, if any, furnished by each Reference Bank for the purpose of
determining the interest rate under Section 2.08(a)(ii).


 


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


 


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


 


(d)           On the date on which the aggregate
unpaid principal amount of Eurodollar Rate Advances comprising any Borrowing
shall be reduced, by payment or prepayment or otherwise, to less than
$10,000,000, such Advances shall automatically Convert into Base Rate Advances.


 


(e)           If an Event of Default has occurred
and is continuing and the Required Lenders through the Agent so notify the
Borrower, then, so long as such Event of Default is continuing (i) each
Eurodollar Rate Advance will automatically, on the last day of the then
existing Interest Period therefor, Convert into a Base Rate Advance and (ii) the
obligation of the Lenders to make, or to Convert Advances into, Eurodollar Rate
Advances shall be suspended.


 


(f)            If Moneyline Telerate Markets Page 3750
(or any successor page as contemplated in the definitions of Eurodollar
Rate or LIBO Rate) is unavailable and fewer than two Reference Banks furnish
timely information to the Agent for determining the Eurodollar Rate or LIBO
Rate for any Eurodollar Rate Advances or LIBO Rate Advances, as the case may
be,


 


(i)            the Agent shall forthwith notify the
Borrower and the Lenders that the interest rate cannot be determined for such
Eurodollar Rate Advances or LIBO Rate Advances, as the case may be,


 


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


 


(iii)          the obligation of the Lenders to make
Eurodollar Rate Advances or LIBO Rate Advances or to Convert Revolving Credit
Advances into Eurodollar Rate Advances shall be suspended until the


 


20





















 


Agent shall notify the Borrower and the
Lenders that the circumstances causing such suspension no longer exist.


 


SECTION 2.10. Optional Conversion of Revolving
Credit Advances. The Borrower may on any Business Day, upon notice given to
the Agent not later than 11:00 A.M. (New York City time) on the third
Business Day prior to the date of the proposed Conversion and subject to the
provisions of Sections 2.09 and 2.13, Convert all Revolving Credit
Advances of one Type comprising the same Borrowing into Revolving Credit
Advances of the other Type; provided, however, that any
Conversion of Eurodollar Rate Advances into Base Rate Advances shall be made
only on the last day of an Interest Period for such Eurodollar Rate Advances,
any Conversion of Base Rate Advances into Eurodollar Rate Advances shall be
subject to Section 2.02(b) and no Conversion of any Revolving Credit
Advances shall result in more separate Revolving Credit Borrowings than
permitted under Section 2.02(b). Each such notice of a Conversion shall,
within the restrictions specified above, specify (i) the date of such
Conversion, (ii) the Revolving Credit Advances to be Converted, and (iii) if
such Conversion is into Eurodollar Rate Advances, the duration of the initial
Interest Period for each such Advance. Each notice of Conversion shall be
irrevocable and binding on the Borrower.


 


SECTION 2.11. Prepayments of Revolving Credit
Advances. The Borrower may, upon notice at least two Business Days’ prior
to the date of such prepayment, in the case of Eurodollar Rate Advances, and
not later than 11:00 A.M. (New York City time) on the date of such
prepayment, in the case of Base Rate Advances, to the Agent stating the
proposed date and aggregate principal amount of the prepayment, and if such
notice is given the Borrower shall, prepay the outstanding principal amount of
the Revolving Credit Advances comprising part of the same Revolving Credit
Borrowing in whole or ratably in part, together with accrued interest to the
date of such prepayment on the principal amount prepaid; provided, however,
that (x) each partial prepayment shall be in an aggregate principal amount of
$10,000,000 or an integral multiple of $1,000,000 in excess thereof and
(y) in the event of any such prepayment of a Eurodollar Rate Borrowing,
the Borrower shall be entitled to select the Eurodollar Rate Borrowings to be
prepaid and shall be obligated to reimburse the Lenders in respect thereof
pursuant to Section 8.04(c).


 


SECTION 2.12. Increased Costs. (a) 
If any governmental authority shall have in effect at any time during the term
of this Agreement any reserve, liquid asset or similar requirement with respect
to any category of deposits or liabilities customarily used to fund Eurodollar
Rate Advances or LIBO Rate Advances, or by reference to which interest rates
applicable to Eurodollar Rate Advances or LIBO Rate Advances are determined,
and the result of such requirement shall be to increase the cost to any Lender
of making or maintaining any Eurodollar Rate Advances or LIBO Rate Advances and
such Lender shall have requested, by notice to the Borrower and the
Administrative Agent (which notice shall specify the costs applicable to such
Lender), compensation under this paragraph, then the Borrower will pay to such
Lender following delivery of such notice (until the earlier of the date such
Lender shall advise the Borrower that such requirement is no longer in effect
or the date such Lender shall withdraw such request) such additional amounts as
shall be necessary to compensate such Lender for such increased costs.


 


(b)           If, due to either (i) the
introduction of or any change in or in the interpretation of any law or
regulation or (ii) the compliance with any guideline or request from any
central bank or other governmental authority (whether or not having the force
of law) after the date hereof, there shall be any increase in the cost to any
Lender of agreeing to make or making, funding or maintaining Eurodollar Rate
Advances or LIBO Rate Advances or of agreeing to issue or of issuing or
maintaining or participating in Letters of Credit (excluding for purposes of
this Section 2.12 any such increased costs resulting from (i) Taxes
or Other Taxes (as to which Section 2.15 shall govern) and (ii) changes
in the basis of taxation of overall net income or overall gross income by the
United States or by the foreign jurisdiction or state under the laws of which
such Lender is organized or has its Applicable Lending Office or any political
subdivision thereof), then the Borrower shall from time to time, upon demand by
such Lender (with a copy of such demand to the Agent), pay to the Agent for the
account of such Lender additional amounts sufficient to compensate such Lender
for such increased cost; provided, however, that before making
any such demand, each Lender agrees to use reasonable efforts (consistent with
its internal policy and legal and regulatory restrictions) to designate a
different Applicable Lending Office if the making of such a designation would
avoid the need for, or reduce the amount of, such increased cost and would not,
in the reasonable judgment of such Lender, be otherwise disadvantageous to such
Lender. A certificate as to the amount of such increased cost,


 


21





















 


submitted to the Borrower and the Agent by such Lender, shall
constitute prima facie evidence of the amounts required to be paid by the
Borrower in respect thereof, absent manifest error.


 


(c)           If any Lender determines that
compliance with any law or regulation or any guideline or request from any
central bank or other governmental authority (whether or not having the force
of law) affects or would affect the amount of capital required or expected to
be maintained by such Lender or any corporation controlling such Lender and
that the amount of such capital is increased by or based upon the existence of
such Lender’s commitment to lend or to issue or participate in Letters of
Credit hereunder and other commitments of such type or the issuance or
maintenance of or participation in the Letters of Credit, then, upon demand by
such Lender (with a copy of such demand to the Agent), the Borrower shall pay
to the Agent for the account of such Lender, from time to time as specified by
such Lender, additional amounts sufficient to compensate such Lender or such
corporation in the light of such circumstances, to the extent that such Lender
reasonably determines such increase in capital to be allocable to the existence
of such Lender’s commitment to lend or to issue or participate in Letters of
Credit hereunder or to the issuance or maintenance of or participation in any
Letters of Credit. A certificate as to such amounts, submitted to the Borrower
and the Agent by such Lender, shall constitute prima facie evidence of the
amounts required to be paid by the Borrower in respect thereof, absent manifest
error.


 


(d)           Failure or delay on the part of any
Lender to demand compensation pursuant to this Section 2.12 shall not
constitute a waiver of such Lender’s right to demand such compensation; provided
that the Borrower shall not be required to compensate such Lender pursuant to
this Section for any increased costs or reductions incurred more than 180
days prior to the date that such Lender notifies the Borrower of the change in
or in the interpretation of law or regulation giving rise to such increased
costs or reductions and of such Lender’s intention to claim compensation
therefore; provided  further that, if the change in or in the
interpretation of law or regulation giving rise to such increased costs or
reductions is retroactive, then the 180-day period referred to above shall be
extended to include the period of retroactive effect thereof.


 


SECTION 2.13. Illegality. Notwithstanding
any other provision of this Agreement, if any Lender shall notify the Agent
that the introduction of or any change in or in the interpretation of any law
or regulation makes it unlawful, or any central bank or other governmental
authority asserts that it is unlawful, for any Lender or its Eurodollar Lending
Office to perform its obligations hereunder to make Eurodollar Rate Advances or
LIBO Rate Advances or to fund or maintain Eurodollar Rate Advances or LIBO Rate
Advances hereunder, (a) each Eurodollar Rate Advance or LIBO Rate Advance,
as the case may be, will automatically, upon such demand, Convert into a Base
Rate Advance or an Advance that bears interest at the rate set forth in Section 2.08(a)(i),
as the case may be, and (b) the obligation of the Lenders to make
Eurodollar Rate Advances or LIBO Rate Advances or to Convert Revolving Credit
Advances into Eurodollar Rate Advances shall be suspended until the Agent shall
notify the Borrower and the Lenders that the circumstances causing such
suspension no longer exist; provided, however, that before making
any such demand, each Lender agrees to use reasonable efforts (consistent with
its internal policy and legal and regulatory restrictions) to designate a
different Eurodollar Lending Office if the making of such a designation would
allow such Lender or its Eurodollar Lending Office to continue to perform its
obligations to make Eurodollar Rate Advances or to continue to fund or maintain
Eurodollar Rate Advances and would not, in the judgment of such Lender, be
otherwise disadvantageous to such Lender.


 


SECTION 2.14. Payments and Computations.
(a)  The Borrower shall make each payment hereunder, irrespective of any
right of counterclaim or set-off,  not
later than 12:00 noon (New York City time) on the day when due in U.S. dollars
to the Agent at the Agent’s Account in same day funds. The Agent will promptly
thereafter cause to be distributed like funds relating to the payment of
principal, interest, fees or commissions ratably (other than amounts payable
pursuant to Section 2.04, 2.05(b) or (c), 2.12, 2.15 or 8.04(c)) to
the Lenders for the account of their respective Applicable Lending Offices, and
like funds relating to the payment of any other amount payable to any Lender to
such Lender for the account of its Applicable Lending Office, in each case to
be applied in accordance with the terms of this Agreement. Upon any Assuming
Lender becoming a Lender hereunder as a result of a Commitment Increase
pursuant to Section 2.19 or an extension of the Termination Date pursuant
to Section 2.20, and upon the Agent’s receipt of such Lender’s Assumption
Agreement and recording of the information contained therein in the Register,
from and after the applicable Increase Date or Extension Date, as the case may
be, the Agent shall make all payments hereunder and under any Notes issued in
connection therewith in respect of the interest assumed thereby to the Assuming
Lender. Upon its acceptance of an Assignment and Acceptance and recording of
the information contained therein in the Register pursuant to Section 8.07(c),
from and after the


 


22





















 


effective date specified in such Assignment and Acceptance, the Agent
shall make all payments hereunder and under the Notes in respect of the
interest assigned thereby to the Lender assignee thereunder, and the parties to
such Assignment and Acceptance shall make all appropriate adjustments in such
payments for periods prior to such effective date directly between themselves.


 


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


 


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


 


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


 


SECTION 2.15. Taxes. (a)  Any and all
payments by the Borrower to or for the account of any Lender or the Agent
hereunder or under the Notes or any other documents to be delivered hereunder
shall be made, in accordance with Section 2.14 or the applicable
provisions of such other documents, free and clear of and without deduction for
any and all present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, excluding, in
the case of each Lender and the Agent, taxes imposed on its overall net income,
and franchise taxes imposed on it in lieu of net income taxes, by the
jurisdiction under the laws of which such Lender or the Agent (as the case may
be) is organized or any political subdivision thereof and, in the case of each
Lender, taxes imposed on its overall net income, and franchise taxes imposed on
it in lieu of net income taxes, by the jurisdiction of such Lender’s Applicable
Lending Office or any political subdivision thereof (all such non-excluded
taxes, levies, imposts, deductions, charges, withholdings and liabilities in
respect of payments hereunder or under the Notes being hereinafter referred to
as “Taxes”). If the Borrower shall be required by law to deduct any
Taxes from or in respect of any sum payable hereunder or under any Note or any
other documents to be delivered hereunder to any Lender or the Agent, (i) the
sum payable shall be increased as may be necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section 2.15) such Lender or the Agent (as the case may be)
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions and (iii) the
Borrower shall pay the full amount deducted to the relevant taxation authority
or other authority in accordance with applicable law.


 


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


 


(c)           The Borrower shall indemnify each
Lender and the Agent for and hold it harmless against the full amount of Taxes
or Other Taxes (including, without limitation, taxes of any kind imposed or
asserted by any jurisdiction on amounts payable under this Section 2.15)
imposed on or paid by such Lender or the Agent (as the


 


23





















 


case may be) and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto. This indemnification shall
be made within 30 days from the date such Lender or the Agent (as the case may
be) makes written demand therefor.


 


(d)           Within 30 days after the date of any
payment of Taxes, the Borrower shall furnish to the Agent, at its address
referred to in Section 8.02, the original or a certified copy of a receipt
evidencing such payment to the extent such a receipt is issued therefor, or
other written proof of payment thereof that is reasonably satisfactory to the
Agent. For purposes of this subsection (d) and subsection (e),
the terms “United States” and “United States person” shall have
the meanings specified in Section 7701 of the Internal Revenue Code.


 


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


 


(f)            For any period with respect to which
a Lender has failed to provide the Borrower with the appropriate form,
certificate or other document described in Section 2.15(e) (other
than if such failure is due to a change in law, or in the interpretation
or application thereof, occurring subsequent to the date on which a form,
certificate or other document originally was required to be provided, or if
such form, certificate or other document otherwise is not required under subsection (e) above),
such Lender shall not be entitled to indemnification under Section 2.15(a) or
(c) with respect to Taxes imposed by the United States by reason of such
failure; provided, however, that should a Lender become subject
to Taxes because of its failure to deliver a form, certificate or other document
required hereunder, the Borrower shall take such steps as the Lender shall
reasonably request to assist the Lender to recover such Taxes.


 


(g)           Any Lender claiming any additional
amounts payable pursuant to this Section 2.15 agrees to use reasonable efforts
(consistent with its internal policy and legal and regulatory restrictions) to
change the jurisdiction of its Eurodollar Lending Office if the making of such
a change would avoid the need for, or reduce the amount of, any such additional
amounts that may thereafter accrue and would not, in the reasonable judgment of
such Lender, be otherwise disadvantageous to such Lender.


 


(h)           If the Agent or any Lender
determines, in its sole discretion, that it has received a refund of any Taxes
or Other Taxes as to which it has been indemnified by the Borrower or with
respect to which the Borrower has paid additional amounts pursuant to this
Section 2.15, it shall pay over such refund to the Borrower (but only to the
extent of indemnity payments made, or additional amounts paid, by the Borrower
under this Section 2.15 with respect to the Taxes or Other Taxes giving rise to
such refund), net of all out-of-pocket expenses of the Agent or such Lender and
without interest (other than any interest paid by the relevant governmental
authority with respect to such refund); provided, that the Borrower,
upon the request of the Agent or such Lender, agrees to repay the amount paid
over to the Borrower (plus any penalties, interest or other charges imposed by
the relevant


 


24





















 


governmental authority) to the Agent or such
Lender in the event the Agent or such Lender is required to repay such refund
to such governmental authority. This paragraph shall not be construed to
require the Agent or any Lender to make available its tax returns (or any other
information relating to its taxes which it deems confidential) to the Borrower
or any other Person.


 


SECTION 2.16. Sharing of Payments, Etc. If
any Lender shall obtain any payment (whether voluntary, involuntary, through
the exercise of any right of set-off, or otherwise) on account of the Revolving
Credit Advances owing to it (other than (x) as payment of an Advance made by an
Issuing Bank pursuant to the first sentence of Section 2.03(c) or (y)
pursuant to Section 2.12, 2.15 or 8.04(c)) in excess of its Ratable Share
of payments on account of the Revolving Credit Advances obtained by all the
Lenders, such Lender shall forthwith purchase from the other Lenders such
participations in the Revolving Credit Advances owing to them as shall be
necessary to cause such purchasing Lender to share the excess payment ratably
with each of them; provided, however, that if all or any portion
of such excess payment is thereafter recovered from such purchasing Lender,
such purchase from each Lender shall be rescinded and such Lender shall repay
to the purchasing Lender the purchase price to the extent of such recovery
together with an amount equal to such Lender’s ratable share (according to the
proportion of (i) the amount of such Lender’s required repayment to (ii) the
total amount so recovered from the purchasing Lender) of any interest or other
amount paid or payable by the purchasing Lender in respect of the total amount
so recovered. The Borrower agrees that any Lender so purchasing a participation
from another Lender pursuant to this Section 2.16 may, to the fullest
extent permitted by law, exercise all its rights of payment (including the
right of set-off provided in Section 8.05) with respect to such
participation as fully as if such Lender were the direct creditor of the
Borrower in the amount of such participation.


 


SECTION 2.17. Evidence of Debt. (a) 
Each Lender shall maintain in accordance with its usual practice an account or
accounts evidencing the indebtedness of the Borrower to such Lender resulting
from each Revolving Credit Advance owing to such Lender from time to time,
including the amounts of principal and interest payable and paid to such Lender
from time to time hereunder in respect of Revolving Credit Advances. The
Borrower agrees that upon notice by any Lender to the Borrower (with a copy of
such notice to the Agent) to the effect that a Revolving Credit Note is
required or appropriate in order for such Lender to evidence (whether for purposes
of pledge, enforcement or otherwise) the Revolving Credit Advances owing to, or
to be made by, such Lender, the Borrower shall promptly execute and deliver to
such Lender a Revolving Credit Note payable to the order of such Lender in a
principal amount up to the Revolving Credit Commitment of such Lender.


 


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


 


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


 


SECTION 2.18. Use of Proceeds. The proceeds
of the Advances shall be available (and the Borrower agrees that it shall use
such proceeds) solely for general corporate purposes of the Borrower and its
Subsidiaries.


 


SECTION 2.19. Increase in the Aggregate
Commitments. (a) The Borrower may, at any time but in any event not
more than once in any calendar year prior to the Termination Date, by notice to
the Agent, request that the aggregate amount of the Revolving Credit
Commitments be increased (with, at the Borrower’s option, a proportionate increase
in the Letter of Credit Facility) by an amount of $10,000,000 or an integral
multiple of


 


25





















 


$10,000,000 in excess thereof (each a “Commitment Increase”) to
be effective as of a date that is at least 90 days prior to the scheduled
Termination Date then in effect (the “Increase Date”) as specified in
the related notice to the Agent; provided, however that (i) in
no event shall the aggregate amount of the Revolving Credit Commitments at any
time exceed $1,500,000,000 and (ii) on the date of any request by the
Borrower for a Commitment Increase and on the related Increase Date, (x) the
Public Debt Rating shall be BBB or better from S&P and Baa2 or better from
Moody’s and (y) the applicable conditions set forth in Section 3.02 shall
be satisfied.


 


(b)           The Agent shall promptly notify the
Lenders of a request by the Borrower for a Commitment Increase, which notice
shall include (i) the proposed amount of such requested Commitment
Increase, (ii) the proposed Increase Date and (iii) the date by which
Lenders wishing to participate in the Commitment Increase must commit to an
increase in the amount of their respective Revolving Credit Commitments (the “Commitment
Date”). Each Lender that is willing to participate in such requested
Commitment Increase (each an “Increasing Lender”) shall, in its sole
discretion, give written notice to the Agent on or prior to the Commitment Date
of the amount by which it is willing to increase its Revolving Credit
Commitment. If the Lenders notify the Agent that they are willing to increase
the amount of their respective Revolving Credit Commitments by an aggregate
amount that exceeds the amount of the requested Commitment Increase, the
requested Commitment Increase shall be allocated among the Lenders willing to
participate therein in such amounts as are agreed between the Borrower and the
Agent.


 


(c)           Promptly following each Commitment
Date, the Agent shall notify the Borrower as to the amount, if any, by which
the Lenders are willing to participate in the requested Commitment Increase. If
the aggregate amount by which the Lenders are willing to participate in any
requested Commitment Increase on any such Commitment Date is less than the
requested Commitment Increase, then the Borrower may extend offers to one or
more Eligible Assignees to participate in any portion of the requested
Commitment Increase that has not been committed to by the Lenders as of the
applicable Commitment Date; provided, however, that the Revolving
Credit Commitment of each such Eligible Assignee shall be in an amount of
$20,000,000 or an integral multiple of $1,000,000 in excess thereof.


 


(d)           On each Increase Date, each Eligible
Assignee that accepts an offer to participate in a requested Commitment
Increase in accordance with Section 2.19(b) (each such Eligible
Assignee and each Eligible Assignee that agrees to an extension of the
Termination Date in accordance with Section 2.20(c), an “Assuming
Lender”) shall become a Lender party to this Agreement as of such Increase
Date and the Revolving Credit Commitment of each Increasing Lender for such
requested Commitment Increase shall be so increased by such amount (or by the
amount allocated to such Lender pursuant to the last sentence of Section 2.19(b))
as of such Increase Date; provided, however, that the Agent shall
have received on or before such Increase Date the following, each dated such
date:


 


(i)            (A) certified copies of
resolutions of the Board of Directors of the Borrower or the Executive
Committee of such Board approving the Commitment Increase and the corresponding
modifications to this Agreement and (B) an opinion of counsel for the
Borrower (which may be in-house counsel), in substantially the form of Exhibit E
hereto;


 


(ii)           an assumption agreement from each
Assuming Lender, if any, in form and substance satisfactory to the Borrower and
the Agent (each an “Assumption Agreement”), duly executed by such
Eligible Assignee, the Agent and the Borrower; and


 


(iii)          confirmation from each Increasing
Lender of the increase in the amount of its Commitment in a writing
satisfactory to the Borrower and the Agent.


 


On each Increase Date,
upon fulfillment of the conditions set forth in the immediately preceding
sentence of this Section 2.19(d), the Agent shall notify the Lenders
(including, without limitation, each Assuming Lender) and the Borrower, on or
before 1:00 P.M. (New York City time), by telecopier, of the occurrence of
the Commitment Increase to be effected on such Increase Date and shall record
in the Register the relevant information with respect to each Increasing Lender
and each Assuming Lender on such date.


 


26





















 


(e)           On the Increase Date, if any Advances
are then outstanding, the Borrower shall borrow from all or certain of the
Lenders and/or (subject to compliance by the Borrower with Section 8.04(c))
prepay Advances of all or certain of the Lenders such that, after giving effect
thereto, the Advances (including, without limitation, the Types and Interest
Periods thereof) shall be held by the Lenders (including for such purposes the
Increasing Lenders and the Assuming Lenders) ratably in accordance with their
respective Revolving Credit Commitments. On and after each Increase Date, the
Ratable Share of each Lender’s participation in Letters of Credit and Advances
from draws under Letters of Credit shall be calculated after giving effect to
each such Commitment Increase.


 


SECTION 2.20. Extension of Termination Date.
(a) At least 60 days but not more than 90 days prior to any anniversary of
the Effective Date, the Borrower, by written notice to the Agent, may request
an extension of the Termination Date in effect at such time by one year from
its then scheduled expiration (which request may be conditioned on a minimum
level of Revolving Credit Commitments from Consenting Lenders and Assuming
Lenders). The Agent shall promptly notify each Lender of such request, and each
Lender shall in turn, in its sole discretion, not later than 30 days prior to
such anniversary date, notify the Borrower and the Agent in writing as to
whether such Lender will consent to such extension. If any Lender shall fail to
notify the Agent and the Borrower in writing of its consent to any such request
for extension of the Termination Date at least 30 days prior to the applicable
anniversary date, such Lender shall be deemed to be a Non-Consenting Lender
with respect to such request. The Agent shall notify the Borrower not later
than 25 days prior to the applicable anniversary date of the decision of the
Lenders regarding the Borrower’s request for an extension of the Termination
Date.


 


(b)           If all the Lenders consent in writing
to any such request in accordance with subsection (a) of this Section 2.20,
the Termination Date in effect at such time shall, effective as at the
applicable anniversary date (the “Extension Date”), be extended for one
year; provided that on each Extension Date the applicable conditions set
forth in Section 3.02 shall be satisfied. If less than all of the Lenders
consent in writing to any such request in accordance with subsection (a) of
this Section 2.20, the Termination Date in effect at such time shall,
effective as at the applicable Extension Date and subject to subsection (d) of
this Section 2.20, be extended as to those Lenders that so consented (each
a “Consenting Lender”) but shall not be extended as to any other Lender
(each a “Non-Consenting Lender”). To the extent that the Termination
Date is not extended as to any Lender pursuant to this Section 2.20 and
the Revolving Credit Commitment of such Lender is not assumed in accordance
with subsection (c) of this Section 2.20 on or prior to the
applicable Extension Date, the Revolving Credit Commitment of such
Non-Consenting Lender shall automatically terminate in whole on such unextended
Termination Date without any further notice or other action by the Borrower,
such Lender or any other Person; provided that such Non-Consenting
Lender’s rights under Sections 2.12, 2.15 and 8.04, and its obligations under Section 7.05,
shall survive the Termination Date for such Lender as to matters occurring
prior to such date. It is understood and agreed that no Lender shall have any
obligation whatsoever to agree to any request made by the Borrower for any
requested extension of the Termination Date.


 


(c)           If less than all of the Lenders
consent to any such request pursuant to subsection (a) of this Section 2.20,
the Agent shall promptly so notify the Consenting Lenders, and each Consenting
Lender may, in its sole discretion, give written notice to the Agent not later
than five days prior to the Extension Date of the amount of the Non-Consenting
Lenders’ Revolving Credit Commitments for which it is willing to accept an
assignment. If the Consenting Lenders notify the Agent that they are willing to
accept assignments of Revolving Credit Commitments in an aggregate amount that
exceeds the amount of the Revolving Credit Commitments of the Non-Consenting
Lenders, such Revolving Credit Commitments shall be allocated among the
Consenting Lenders willing to accept such assignments in such amounts as are
agreed between the Borrower and the Agent. If after giving effect to the
assignments of Revolving Credit Commitments described above there remains any
Revolving Credit Commitments of Non-Consenting Lenders, the Borrower may
arrange for one or more Consenting Lenders or other Eligible Assignees as
Assuming Lenders to assume, effective as of the Extension Date, any
Non-Consenting Lender’s Revolving Credit Commitment and all of the obligations
of such Non-Consenting Lender under this Agreement thereafter arising, without
recourse to or warranty by, or expense to, such Non-Consenting Lender; provided,
however, that the amount of the Revolving Credit Commitment of any such
Assuming Lender as a result of such substitution shall in no event be less than
$20,000,000 unless the amount of the Revolving Credit Commitment of such
Non-Consenting Lender is less than $20,000,000, in which case such Assuming
Lender shall assume all of such lesser amount; and provided  further
that:


 


27





















 


(i)            any such Consenting Lender or
Assuming Lender shall have paid to such Non-Consenting Lender (A) the
aggregate principal amount of, and any interest accrued and unpaid to the
effective date of the assignment on, the outstanding Advances, if any, of such
Non-Consenting Lender plus (B) any accrued but unpaid facility fees
owing to such Non-Consenting Lender as of the effective date of such
assignment;


 


(ii)           all additional costs reimbursements,
expense reimbursements and indemnities payable to such Non-Consenting Lender,
and all other accrued and unpaid amounts owing to such Non-Consenting Lender
hereunder, as of the effective date of such assignment shall have been paid to
such Non-Consenting Lender; and


 


(iii)          with respect to any such Assuming
Lender, the applicable processing and recordation fee required under Section 8.07(a) for
such assignment shall have been paid;


 


provided
further that such Non-Consenting Lender’s rights under Sections 2.12,
2.15 and 8.04, and its obligations under Section 7.05, shall survive such
substitution as to matters occurring prior to the date of substitution. At
least five Business Days prior to any Extension Date, (A) each such
Assuming Lender, if any, shall have delivered to the Borrower and the Agent an
Assumption Agreement, duly executed by such Assuming Lender, such
Non-Consenting Lender, the Borrower and the Agent and (B) any such
Consenting Lender shall have delivered confirmation in writing satisfactory to the
Borrower and the Agent as to the increase in the amount of its Commitment. Upon
the payment or prepayment of all amounts referred to in clauses (i), (ii) and
(iii) of the immediately preceding sentence, each such Consenting Lender
or Assuming Lender, as of the Extension Date, will be substituted for such
Non-Consenting Lender under this Agreement and shall be a Lender for all
purposes of this Agreement, without any further acknowledgment by or the
consent of the other Lenders, and the obligations of each such Non-Consenting
Lender hereunder shall, by the provisions hereof, be released and discharged.


 


(d)           If (after giving effect to any
assignments or assumptions pursuant to subsection (c) of this Section 2.20)
Lenders having Commitments equal to at least 50% of the Revolving Credit
Commitments in effect immediately prior to the Extension Date consent in
writing to a requested extension (whether by execution or delivery of an
Assumption Agreement or otherwise) not later than one Business Day prior to such
Extension Date, the Agent shall so notify the Borrower, and, subject to the
satisfaction of the applicable conditions in Section 3.02, the Termination
Date then in effect shall be extended for the additional one year period as
described in subsection (a) of this Section 2.20, and all
references in this Agreement, and in the Notes, if any, to the “Termination
Date” shall, with respect to each Consenting Lender and each Assuming
Lender for such Extension Date, refer to the Termination Date as so extended. Promptly
following each Extension Date, the Agent shall notify the Lenders (including,
without limitation, each Assuming Lender) of the extension of the scheduled
Termination Date in effect immediately prior thereto and shall thereupon record
in the Register the relevant information with respect to each such Consenting
Lender and each such Assuming Lender.


 


SECTION 2.21. Replacement of Lenders. If
any Lender requests compensation under Section 2.12 or notifies the Agent
under Section 2.13 that the making of Eurodollar Rate Advances would be
unlawful, or if the Borrower is required to pay any additional amount to any
Lender or any governmental authority for the account of any Lender pursuant to Section 2.15,
or if any Lender defaults in its obligation to make Advances hereunder or fails
to approve any amendment to this Agreement which is approved by the Required
Lenders, then the Borrower may, at its sole expense and effort, upon notice to
such Lender and the Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in Section 8.07),
all its interests, rights and obligations under this Agreement (other than any
outstanding Competitive Bid Advances held by it) to an assignee that shall
assume such obligations (which assignee may be another Lender, if a Lender
accepts such assignment); provided that (i) if the assignee is not
a Lender, the Borrower shall have received the prior written consent of the
Agent, which consent shall not unreasonably be withheld, (ii) such Lender
shall have received payment of an amount equal to the outstanding principal of
its Advances (other than Competitive Bid Advances), accrued interest thereon,
accrued fees and all other amounts then due and payable to it hereunder, from
the assignee (to the extent of such outstanding principal and accrued interest
and fees) or the Borrower (in the case of all other amounts) and (iii) in
the case of any such assignment resulting from a claim for compensation under Section 2.12
or payments required to be made pursuant to Section 2.15, such assignment
will result in a reduction in such


 


28





















 


compensation or payments at the time of such assignment. A Lender shall
not be required to make any such assignment and delegation if, prior thereto,
as a result of a waiver by such Lender or otherwise, the circumstances
entitling the Borrower to require such assignment and delegation cease to
apply.


 


ARTICLE III


 


CONDITIONS TO EFFECTIVENESS AND
LENDING


 


SECTION 3.01. Conditions Precedent to
Effectiveness of Sections 2.01 and 2.04. Sections 2.01 and 2.04 shall
become effective on and as of the first date (the “Effective Date”) on
which the following conditions precedent have been satisfied:


 


(a)           Except as disclosed in the Public
Filings, there shall have occurred no Material Adverse Change since December 31,
2004.


 


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


 


(c)           The Borrower shall have notified each
Lender and the Agent in writing as to the proposed Effective Date, and the
Agent shall have confirmed to the Borrower in writing that the Effective Date
has occurred.


 


(d)           The Borrower shall have paid all
accrued fees and expenses of the Agent and the Lenders (including the accrued
fees and expenses of counsel to the Agent) that have been invoiced at least two
Business Days prior to the proposed Effective Date.


 


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


 


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


 


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


 


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


 


(i)            The Revolving Credit Notes to the
order of the Lenders to the extent requested by any Lender pursuant to Section 2.17.


 


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


 


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


 


(iv)          A favorable opinion of Bruce A.
Backberg, Senior Vice President and Corporate Secretary of the Borrower,
substantially in the form of Exhibit D hereto and as to such other matters
as any Lender through the Agent may reasonably request.


 


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


 


(g)           The Borrower shall have terminated
the commitments, and paid in full all Debt, interest, fees and other amounts
then due and payable, under (A) the Five Year Credit Agreement dated as of
June 14, 2002, amended and restated as of June 11, 2004, among the
Borrower, the lenders and agents parties thereto and Citicorp, as
administrative agent, and (B) the $250,000,000 credit facility dated as of
April 17, 2003 between an Affiliate of the Borrower and Citibank, N.A.,
and each of the Lenders that is a party to either such credit facility hereby
waives, upon execution of this Agreement the requirement of prior notice under
each such credit facility relating to the termination of commitments
thereunder.


 


SECTION 3.02. Conditions Precedent to Each
Revolving Credit Borrowing, Issuance, Commitment Increase and Extension of
Commitments. The obligation of each Lender to make a Revolving Credit
Advance (other than a Revolving Credit Advance made by any Issuing Bank or any
Lender pursuant to Section 2.03(c)) on the occasion of each Revolving
Credit Borrowing, the obligation or each Issuing Bank to issue a Letter of
Credit, each Commitment Increase and each extension of Commitments pursuant to Section 2.20
shall be subject to the conditions precedent that the Effective Date shall have
occurred and on the date of such Revolving Credit Borrowing, such Issuance, the
applicable Increase Date or the applicable Extension Date the following
statements shall be true (and each of the giving of the applicable Notice of
Revolving Credit Borrowing, Notice of Issuance, request for Commitment
Increase, request for Commitment Extension and the acceptance by the Borrower
of the proceeds of such Revolving Credit Borrowing or such Issuance shall
constitute a representation and warranty by the Borrower that on the date of
such Borrowing, such Issuance, such Increase Date or such Extension Date such
statements are true):


 


(a)           the representations and warranties
contained in Section 4.01 (except, in the case of Revolving Credit
Borrowings or Issuances, the representations set forth in the last sentence of
subsection (e) thereof and in subsection (f) thereof) are correct in
all material respects on and as of such date, before and after giving effect to
such Revolving Credit Borrowing, such Issuance, such Commitment Increase or
such Extension Date and to the application of the proceeds therefrom, as though
made on and as of such date, and


 


(b)           no event has occurred and is
continuing, or would result from such Revolving Credit Borrowing, such
Issuance, such Commitment Increase or such Extension Date or from the
application of the proceeds therefrom, that constitutes a Default.


 


SECTION 3.03. Conditions Precedent to Each
Competitive Bid Borrowing. The obligation of each Lender that is to make a
Competitive Bid Advance on the occasion of a Competitive Bid Borrowing to make
such Competitive Bid Advance as part of such Competitive Bid Borrowing is
subject to the conditions precedent that (i) the Agent shall have received
the written confirmatory Notice of Competitive Bid Borrowing with respect
thereto,  (ii) on or before the date
of such Competitive Bid Borrowing, but prior to such Competitive Bid Borrowing,
the Agent shall have received a Competitive Bid Note payable to the order of
such Lender for each of the one or more Competitive Bid Advances to be made by
such Lender as part of such Competitive Bid Borrowing, in a principal amount
equal to the principal amount of the Competitive Bid Advance to be evidenced
thereby and otherwise on such terms as were agreed to for such Competitive Bid
Advance in accordance with Section 2.04, and (iii) on the date of
such Competitive Bid Borrowing the following statements shall be true (and each
of the giving of the applicable Notice of Competitive Bid Borrowing and the
acceptance by the Borrower of the proceeds of such


 


30





















 


Competitive Bid Borrowing shall constitute a representation and
warranty by the Borrower that on the date of such Competitive Bid Borrowing
such statements are true):


 


(a)           the representations and warranties
contained in Section 4.01 (except the representations set forth in the
last sentence of subsection (e) thereof and in subsection (f) thereof)
are correct in all material respects on and as of the date of such Competitive
Bid Borrowing, before and after giving effect to such Competitive Bid Borrowing
and to the application of the proceeds therefrom, as though made on and as of
such date, and


 


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


 


SECTION 3.04. Determinations Under Section 3.01.
For purposes of determining compliance with the conditions specified in Section 3.01,
each Lender shall be deemed to have consented to, approved or accepted or to be
satisfied with each document or other matter required thereunder to be
consented to or approved by or acceptable or satisfactory to the Lenders unless
an officer of the Agent responsible for the transactions contemplated by this
Agreement shall have received notice from such Lender prior to the date that
the Borrower, by notice to the Lenders, designates as the proposed Effective
Date, specifying its objection thereto. The Agent shall promptly notify the
Lenders of the occurrence of the Effective Date.


 


ARTICLE IV


 


REPRESENTATIONS AND WARRANTIES


 


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


 


(a)           The Borrower is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Minnesota and has all corporate powers and authority and all material licenses,
authorizations, consents and approvals required to carry on its business as now
conducted and each of the Borrower and each Significant Subsidiary is duly
qualified as a foreign corporation, licensed and in good standing in each
jurisdiction where qualification or licensing is required by the nature of its
business or the character and location of its property, business or customers,
where the failure to be so qualified or licensed could reasonably be expected
to have a Material Adverse Effect.


 


(b)           The execution, delivery and
performance by the Borrower of this Agreement and the Notes to be delivered by
it, and the consummation of the transactions contemplated hereby, are within
the Borrower’s corporate powers, have been duly authorized by all necessary
corporate action, and do not (i) contravene the Borrower’s charter or
by-laws, (ii) violate any law, rule, regulation, order, writ, judgment, decree,
determination or award applicable to the Borrower if such violation could
reasonably be expected to have a Material Adverse Effect or (iii) violate
or constitute a default under any contractual restriction binding on or
affecting the Borrower if such violation or default could reasonably be
expected to have a Material Adverse Effect or subject the Lenders, the Agent or
the lead arranger to liability.


 


(c)           No authorization or approval or other
action by, and no notice to or filing (other than an immaterial authorization,
approval, action, notice or filing) with, any governmental authority or
regulatory body or any other third party is required for the due execution,
delivery and performance by the Borrower of this Agreement or the Notes to be
delivered by it, except for those that have been duly obtained, taken, given or
made and are in full force and effect.


 


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


 


31





















 


applicable bankruptcy, insolvency,
reorganization, moratorium or similar law affecting creditors’ rights
generally, (ii) the effect of general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law
and (iii) an implied covenant of good faith and fair dealing.


 


(e)           Except as disclosed on Schedule 4.01(e),
(i) the Consolidated balance sheet of the Borrower and its Subsidiaries as
at December 31, 2004, and the related Consolidated statements of income
and cash flows of the Borrower and its Subsidiaries for the fiscal year then
ended, accompanied by an opinion of KPMG LLP, independent public accountants,
and (ii) the Consolidated balance sheet of the Borrower and its
Subsidiaries as at March 31, 2005, which set forth the financial condition
of the Borrower and is Subsidiaries, and the related Consolidated statements of
income and cash flows of the Borrower and its Subsidiaries for the three months
then ended, duly certified by the chief financial officer or chief accounting
officer of the Borrower, copies of which have been furnished to each Lender,
fairly present in all material respects, subject, in the case of said balance
sheet as at March 31, 2005, and said statements of income and cash flows
for the three months then ended, to year-end audit adjustments and the absence
of certain notes, the Consolidated financial condition of the Borrower and its
Subsidiaries as at such dates and the Consolidated results of the operations of
the Borrower and its Subsidiaries for the periods ended on such dates, all in
accordance with generally accepted accounting principles consistently applied. Except
as otherwise disclosed in the Public Filings, since December 31, 2004,
there has been no Material Adverse Change.


 


(f)            There is no pending or, to the
knowledge of the Borrower, threatened action, suit, investigation, litigation
or proceeding, including, without limitation, under any Environmental Law,
affecting the Borrower or any of its Subsidiaries before any court,
governmental agency or arbitrator that (i) except as disclosed in the
Public Filings, could be reasonably likely to have a Material Adverse Effect,
and there shall have been no additional claim made in respect of any such
action, suit, investigation, litigation or proceeding disclosed in the Public
Filings that could be reasonably likely to have a Material Adverse Effect or (ii) purports
to affect the legality, validity or enforceability of this Agreement or any
Note or the consummation of the transactions contemplated hereby.


 


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


 


(h)           The Borrower is not an “investment
company”, or a company “controlled” by an “investment company”, within the
meaning of the Investment Company Act of 1940, as amended.


 


(i)            Neither the Information Memorandum
nor any written information distributed at the bank meeting on May 16,
2005 by or on behalf of the Borrower to the Agent or any Lender prior to the
date hereof in connection with the negotiation of this Agreement, or delivered
hereunder, when furnished and taken as a whole, contains any material
misstatement of fact or omits to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not materially misleading; provided that, with respect to
estimated or projected financial information, general industry information or
forward looking statements, the Borrower represents only that such information
was prepared in good faith based upon assumptions believed to be reasonable at
the time and no assurance is given as to whether future events will vary from
such information or statements.


 


ARTICLE V


 


COVENANTS OF THE BORROWER


 


SECTION 5.01. Affirmative Covenants. So
long as any Advance shall remain unpaid, any Letter of Credit is outstanding or
any Lender shall have any Commitment hereunder, the Borrower will:


 


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(a)           Compliance with Laws, Etc. Comply,
and cause each of its Subsidiaries to comply, in all material respects, with
all applicable laws, rules, regulations and orders, such compliance to include,
without limitation, compliance with ERISA and Environmental Laws, except to the
extent that failure to so comply would not reasonably be expected to have a
Material Adverse Effect.


 


(b)           Payment of Taxes, Etc. Pay and
discharge, and cause each of its Subsidiaries to pay and discharge, before the
same shall become delinquent, (i) all taxes, assessments and governmental
charges or levies imposed upon it or upon its property that, if unpaid, might
by law become a Lien or charge upon its property and (ii) all lawful
claims that, if unpaid, might by law become a Lien upon its property; provided,
however, that neither the Borrower nor any of its Subsidiaries shall be
required to pay or discharge any such tax, assessment, charge or claim (x) that
is being contested in good faith and by proper proceedings and as to which
appropriate reserves are being maintained or (y) the non-payment of which,
either individually or in the aggregate, would not reasonably be expected to
have a Material Adverse Effect.


 


(c)           Maintenance of Insurance. Maintain,
and cause each of its Subsidiaries to maintain, insurance with responsible and
reputable insurance companies or associations in such amounts and covering such
risks as the Borrower shall from time to time determine, based on its
experience and knowledge of the industry, are of a character usually carried by
companies engaged in similar businesses and owning similar properties in the
same general areas in which the Borrower or such Subsidiary operates; provided,
however, that the Borrower and its Subsidiaries may self-insure to the
extent consistent with prudent business practice.


 


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


 


(e)           Visitation Rights. Without
limitation of Section 8.08, at any reasonable time and from time to time
during normal business hours, permit the Agent at the request of any of the
Lenders or any agents or representatives thereof, to examine and make copies of
and abstracts from the records and books of account of, and visit the
properties of, the Borrower and any of its Subsidiaries, and to discuss the
affairs, finances and accounts of the Borrower and any of its Subsidiaries with
any of their officers or directors and with their independent certified public
accountants.


 


(f)            Keeping of Books. Except as
disclosed on Schedule 4.01(e), keep, and cause each of its Subsidiaries to
keep, proper books of record and account, in which full and correct entries
shall be made of all financial transactions and the assets and business of the
Borrower and each such Subsidiary in accordance with applicable generally
accepted accounting principles in effect from time to time.


 


(g)           Maintenance of Properties, Etc.
Maintain and preserve, and cause each of its Subsidiaries to maintain and
preserve, all of its properties that are used or useful in the conduct of its
business in good working order and condition (ordinary wear and tear excepted)
except to the extent that failure to do so could not reasonably be expected to
have a Material Adverse Effect.


 


(h)           Transactions with Affiliates. Conduct,
and cause each of its Subsidiaries to conduct, all transactions otherwise
permitted under this Agreement with any of their Affiliates on terms that are
fair and reasonable and no less favorable to the Borrower or such Subsidiary
than it would obtain in a comparable arm’s-length transaction with a Person not
an Affiliate.


 


(i)            Reporting Requirements. Furnish
to the Lenders:


 


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(i)            as soon as available and in any
event within 45 days after the end of each of the first three quarters of each
fiscal year of the Borrower, the Consolidated balance sheet of the Borrower and
its Subsidiaries as of the end of such quarter and Consolidated statements of
income and cash flows of the Borrower and its Subsidiaries for the period
commencing at the end of the previous fiscal year and ending with the end of
such quarter, duly certified (subject to year-end audit adjustments) by the
chief financial officer or chief accounting officer of the Borrower as having
been prepared in accordance with generally accepted accounting principles and
certificates of the chief financial officer or chief accounting officer of the
Borrower as to compliance with the terms of this Agreement and setting forth in
reasonable detail the calculations necessary to demonstrate compliance with Section 5.03,
provided that in the event of any change in generally accepted
accounting principles used in the preparation of such financial statements, the
Borrower shall also provide, if necessary for the determination of compliance
with Section 5.03, a statement of reconciliation conforming such financial
statements to GAAP;


 


(ii)           as soon as available and in any event
within 90 days after the end of each fiscal year of the Borrower, a copy of the
annual audit report for such year for the Borrower and its Subsidiaries,
containing the Consolidated balance sheet of the Borrower and its Subsidiaries
as of the end of such fiscal year and Consolidated statements of income and
cash flows of the Borrower and its Subsidiaries for such fiscal year, in each
case accompanied by an opinion acceptable to the Required Lenders by KPMG LLP
or other independent public accountants acceptable to the Required Lenders and,
in addition, the Borrower will provide a certificate of its chief financial
officer or chief accounting officer setting forth in reasonable detail the
calculations necessary to demonstrate compliance with Section 5.03, provided
that in the event of any change in generally accepted accounting principles
used in the preparation of such financial statements, the Borrower shall also
provide, if necessary for the determination of compliance with Section 5.03,
a statement of reconciliation conforming such financial statements to GAAP;


 


(iii)          as soon as possible and in any event
within five days after any senior officer becomes aware or should have become
aware of the occurrence of each Default continuing on the date of such
statement, a statement of the chief financial officer or chief accounting
officer of the Borrower setting forth details of such Default and the action
that the Borrower has taken and proposes to take with respect thereto;


 


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


 


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


 


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


 


Reports and financial statements required to
be delivered by Borrower pursuant to clauses (i), (ii), (iii), (v) and (vi) of
this subsection (i) shall be deemed to have been delivered on the
date on which the Borrower posts such reports, or reports containing such
financial statements, on its website on the Internet at
www.stpaultravelers.com, at www.sec.gov or at such other website identified by
the Borrower in a notice to the Agent and the Lenders and that is accessible by
the Lenders without charge; provided that the Borrower shall deliver
paper copies of such information to any Lender promptly upon request of such
Lender through the Agent and provided  further that the Lenders
shall be deemed to have received the information specified in clauses (i) through
(vi) of this subsection (i) on the date (x) such information is
posted at the website of the Agent identified from time to time by the Agent to
the Lenders and the


 


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Borrower and (y) such posting is notified to
the Lenders (it being understood that the Borrower shall have satisfied the
timing obligations imposed by those clauses as of the date such information is
delivered to the Agent).


 


SECTION 5.02. Negative Covenants. So long
as any Advance shall remain unpaid, any Letter of Credit is outstanding or any
Lender shall have any Commitment hereunder, the Borrower will not:


 


(a)           Liens, Etc. Create or suffer
to exist, or permit any of its Subsidiaries to create or suffer to exist, any
Lien on or with respect to any of its properties, whether now owned or
hereafter acquired, other than:


 


(i)            Permitted Liens,


 


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


 


(iii)          the Liens existing on the Effective
Date and described on Schedule 5.02(a) hereto,


 


(iv)          Liens on property of a Person existing
at the time such Person is merged into or consolidated with the Borrower or any
Subsidiary of the Borrower or becomes a Subsidiary of the Borrower; provided
that such Liens were not created in contemplation of such merger, consolidation
or acquisition and do not extend to any assets other than those of the Person
so merged into or consolidated with the Borrower or such Subsidiary or acquired
by the Borrower or such Subsidiary,


 


(v)           Liens arising in connection with
capital lease obligations; provided, however, that no such Lien
shall extend to or cover any property or assets other than the property and
assets subject to such capital lease obligations,


 


(vi)          Liens arising in connection with
repurchase agreements, reverse purchase agreements and other similar agreements
for the purchase, sale or loan of securities, in each case in the ordinary
course of business; provided that
no such Lien shall extend to or cover any property or assets other than the
securities subject thereto,


 


(vii)         Liens on accounts or notes receivable
(whether such accounts or notes receivable constitute accounts, instruments,
chattel paper or general intangibles) and other related assets, and sales or
discounts on the foregoing, arising solely in connection with the
securitization thereof (whether in one transaction or in a series of transactions);
provided that no such Lien shall extend to or cover any property or
assets other than the receivables and related assets subject to such
securitization,


 


(viii)        Liens on Invested Assets pursuant to
trust, letter of credit or other security arrangements in connection with
Reinsurance Agreements or Primary Policies;


 


35





















 


(ix)           other Liens securing Debt and other
obligations in an aggregate principal amount, which, together with, without
duplication, all other Liens permitted by clauses (iv) through (viii) above
and this clause (ix), secures Debt in an aggregate principal amount at the time
such Debt or other obligations are incurred not to exceed 15% of the Net Worth
of the Borrower and its Subsidiaries on a consolidated basis as of the last day
of the immediately preceding fiscal period for which financial statements have
been delivered,


 


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


 


(xi)           any Lien on any asset of St. Paul
Fire securing a reimbursement obligation arising from the issuance of a letter
of credit for the account of St. Paul Fire (or one of its Affiliates) in the
ordinary course of business.


 


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


 


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


 


(d)           Change in Nature of Business. Engage,
or permit any Significant Subsidiaries to engage, in any business other than
businesses engaged in on the date hereof and businesses incidental, ancillary
or complementary thereto.


 


SECTION 5.03. Financial Covenants. So long
as any Advance shall remain unpaid, any Letter of Credit is outstanding or any
Lender shall have any Commitment hereunder, the Borrower will:


 


(a)           Tangible Net Worth. Maintain
an excess of Consolidated Net Worth over goodwill and other intangible assets
of not less than $10,000,000,000 at all times.


 


(b)           Leverage Ratio. Maintain a
ratio of Total Consolidated Debt to the sum of Total Consolidated Debt plus
Consolidated Net Worth of not greater than 0.40 to 1.00.


 


ARTICLE VI


 


EVENTS OF DEFAULT


 


SECTION 6.01. Events of Default. If any of
the following events (“Events of Default”) shall occur and be
continuing:


 


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


 


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


 


36





















 


(c)           (i) The Borrower shall fail to
perform or observe any term, covenant or agreement contained in Section 5.01(d),
(e), (h) or (i)(iii), 5.02 or 5.03, or (ii) the Borrower shall fail
to perform or observe any other term, covenant or agreement contained in this
Agreement on its part to be performed or observed if such failure shall remain
unremedied for 30 days after written notice thereof shall have been given to
the Borrower by the Agent or any Lender, provided that it shall not be an Event
of Default for a failure to provide a notice of Default under Section 5.01(i)(iii) with
respect a Default under clause (ii) of this Section until the day
which is 30 days after any senior officer becomes aware or should have become
aware of the occurrence of such Default at which time the failure to provide
such notice shall be an Event of Default; or


 


(d)           The Borrower or any of its
Subsidiaries shall fail to pay any principal of or premium or interest on any
Debt that is outstanding in a principal amount or, in the case of a Hedge
Agreement, net amount, of at least $75,000,000 in the aggregate (but excluding
Debt outstanding hereunder) of the Borrower or such Subsidiary (as the case may
be), when the same becomes due and payable (whether by scheduled maturity,
required prepayment, acceleration, demand or otherwise), and such failure shall
continue after the applicable grace period, if any, specified in the agreement
or instrument relating to such Debt; or any other event shall occur or
condition shall exist under any agreement or instrument relating to any such
Debt and shall continue after the applicable grace period, if any, specified in
such agreement or instrument, if the effect of such event or condition is to
accelerate the maturity of such Debt; or any such Debt shall be declared to be
due and payable, or required to be prepaid or redeemed (other than by a
regularly scheduled required prepayment or redemption), purchased or defeased,
or an offer to prepay, redeem, purchase or defease such Debt shall be required
to be made, in each case prior to the stated maturity thereof; or


 


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


 


(f)            Judgments or orders for the payment
of money in excess of $75,000,000 in the aggregate shall be rendered against
the Borrower or any of its Subsidiaries and either (i) enforcement
proceedings shall have been commenced by any creditor upon such judgment
following a failure of the Borrower or any of its Subsidiaries to pay the
amount of such order and such proceedings shall remain unstayed for 10
consecutive Business Days or (ii) there shall be any period of 30
consecutive days during which a stay of enforcement of such judgment or order,
by reason of a pending appeal or otherwise, shall not be in effect; provided,
however, that any such judgment or order shall not be an Event of
Default under this Section 6.01(f) if and for so long as (i) the
amount of such judgment or order is covered by a valid and binding policy of
insurance between the defendant and the insurer covering payment thereof and (ii) such
insurer, which shall be rated at least “A” by A.M. Best Company, has been
notified of, and has not disputed the claim made for payment of, the amount of
such judgment or order; or


 


(g)           (i) Any Person or two or more
Persons acting in concert shall have acquired beneficial ownership (within the
meaning of Rule 13d-3 of the Securities and Exchange Commission under the
Securities Exchange Act of 1934), directly or indirectly, of Voting Stock of
the Borrower (or other securities convertible into such Voting Stock)
representing 35% or more of the combined voting power of


 


37





















 


all Voting Stock of the Borrower; or (ii) during
any period of up to 24 consecutive months, commencing before or after the date
of this Agreement, individuals who at the beginning of such 24-month period
were directors of the Borrower shall cease for any reason (other than due to
death or disability) to constitute a majority of the board of directors of the
Borrower (except to the extent that individuals who at the beginning of such 24-month
period were replaced by individuals (x) elected by a majority of the
remaining members of the board of directors of the Borrower or
(y) nominated for election by a majority of the remaining members of the
board of directors of the Borrower and thereafter elected as directors by the
shareholders of the Borrower); or


 


(h)           The Borrower or any of its ERISA
Affiliates shall incur, or shall be reasonably likely to incur liability in
excess of $75,000,000 in the aggregate as a result of one or more of the
following:  (i) the occurrence of
any ERISA Event; (ii) the partial or complete withdrawal of the Borrower
or any of its ERISA Affiliates from a Multiemployer Plan within the meaning of Part 1
of Subtitle E of Title IV of ERISA; or (iii) the reorganization (within
the meaning of Section 4241 of ERISA) or the termination of a
Multiemployer Plan pursuant to Section 4041A or 4042 of ERISA; or


 


(i)            (i)  any insurance commissioner
or any other state insurance regulatory official shall intervene through legal
proceedings and assume control of any material portion of the business of any
Significant Subsidiary or (ii) any insurance commissioner or any State
insurance regulatory official shall initiate any legal proceeding not dismissed
or stayed within 90 days with a view toward so intervening, in the control of a
material portion of the business of any Significant Subsidiary, or the Borrower
or any Significant Subsidiary shall intentionally facilitate or take any
affirmative action toward facilitating such intervention, excluding from the
above normal regulatory practices including the review and approval of rates
and forms, market conduct examinations and other normal examinations;


 


then, and in any such
event, the Agent (i) shall at the request, or may with the consent, of the
Required Lenders, by notice to the Borrower, declare the obligation of each
Lender to make Advances (other than Advances to be made by an Issuing Bank or a
Lender pursuant to Section 2.03(c)) and of the Issuing Banks to issue
Letters of Credit to be terminated, whereupon the same shall forthwith terminate,
and (ii) shall at the request, or may with the consent, of the Required
Lenders, by notice to the Borrower, declare the Advances, all interest thereon
and all other amounts payable under this Agreement to be forthwith due and
payable, whereupon the Advances, all such interest and all such amounts shall
become and be forthwith due and payable, without presentment, demand, protest
or further notice of any kind, all of which are hereby expressly waived by the
Borrower; provided, however, that in the event of an actual or
deemed entry of an order for relief with respect to the Borrower under the
Federal Bankruptcy Code, (A) the obligation of each Lender to make
Advances (other than Advances to be made by an Issuing Bank or a Lender
pursuant to Section 2.03(c)) and of the Issuing Banks to issue Letters of
Credit shall automatically be terminated and (B) the Advances, all such
interest and all such amounts shall automatically become and be due and
payable, without presentment, demand, protest or any notice of any kind, all of
which are hereby expressly waived by the Borrower.


 


SECTION 6.02. Actions in Respect of the
Letters of Credit upon Default. If any Event of Default shall have occurred
and be continuing, the Agent may with the consent, or shall at the request, of
the Required Lenders, irrespective of whether it is taking any of the actions
described in Section 6.01 or otherwise, make demand upon the Borrower to,
and forthwith upon such demand the Borrower will, (a) pay to the Agent on
behalf of the Lenders in same day funds at the Agent’s office designated in
such demand, for deposit in the L/C Securities Account, an amount equal to the
aggregate Available Amount of all Letters of Credit (other than Secured Letters
of Credit) then outstanding or (b) make such other arrangements in respect
of the outstanding Letters of Credit as shall be acceptable to the Required
Lenders and not more disadvantageous to the Borrower than clause (a); provided,
however, that in the event of an actual or deemed entry of an order for
relief with respect to the Borrower under the Federal Bankruptcy Code, an
amount equal to the aggregate Available Amount of all outstanding Letters of
Credit (other than Secured Letters of Credit) shall be immediately due and
payable to the Agent for the account of the Lenders without notice to or demand
upon the Borrower, which are expressly waived by the Borrower, to be held in
the L/C Securities Account. If at any time thereafter the Agent determines that
the funds held in the L/C Securities Account are less than the aggregate
Available Amount of all Letters of Credit, the Borrower will, forthwith upon
demand by the Agent, pay to the Agent, as additional funds to be deposited and
held in the L/C Securities Account,


 


38





















 


an amount equal to the excess of (a) such aggregate Available
Amount over (b) the total amount of funds, if any, then held in the L/C
Securities Account that the Agent determines to be free and clear of any such
right and claim. Upon the drawing of any Letter of Credit thereafter, to the
extent funds are on deposit in the L/C Securities Account, such funds shall be
applied to reimburse the Issuing Banks to the extent permitted by applicable
law. After all such Letters of Credit shall have expired or been fully drawn
upon and all other obligations of the Borrower hereunder and under the Notes
shall have been paid in full, the balance, if any, in such L/C Securities
Account shall be returned to the Borrower.


 


ARTICLE VII


 


THE AGENT


 


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


 


SECTION 7.02. Agent’s Reliance, Etc. Neither
the Agent nor any of its directors, officers, agents or employees shall be
liable for any action taken or omitted to be taken by it or them under or in
connection with this Agreement, except for its or their own gross negligence or
willful misconduct. Without limitation of the generality of the foregoing, the
Agent:  (i) may treat the Lender
that made any Advance as the holder of the Debt resulting therefrom until the
Agent receives and accepts an Assumption Agreement entered into by an Assuming
Lender as provided in Section 2.19 or 2.20, as the case may be, or an Assignment
and Acceptance entered into by such Lender, as assignor, and an Eligible
Assignee, as assignee, as provided in Section 8.07; (ii) may consult
with legal counsel (including counsel for the Borrower), independent public
accountants and other experts selected by it and shall not be liable for any
action taken or omitted to be taken in good faith by it in accordance with the
advice of such counsel, accountants or experts; (iii) makes no warranty or
representation to any Lender and shall not be responsible to any Lender for any
statements, warranties or representations (whether written or oral) made in or
in connection with this Agreement; (iv) shall not have any duty to
ascertain or to inquire as to the performance, observance or satisfaction of
any of the terms, covenants or conditions of this Agreement on the part of the
Borrower or the existence at any time of any Default or to inspect the property
(including the books and records) of the Borrower; (v) shall not be
responsible to any Lender for the due execution, legality, validity,
enforceability, genuineness, sufficiency or value of, or the perfection or
priority of any lien or security interest created or purported to be created
under or in connection with, this Agreement or any other instrument or document
furnished pursuant hereto; and (vi) shall incur no liability under or in
respect of this Agreement by acting upon any notice, consent, certificate or
other instrument or writing (which may be by telecopier or telegram) believed
by it to be genuine and signed or sent by the proper party or parties.


 


SECTION 7.03. Citicorp and Affiliates. With
respect to its Commitment, the Advances made by it and the Note issued to it,
Citicorp shall have the same rights and powers under this Agreement as any
other Lender and may exercise the same as though it were not the Agent; and the
term “Lender” or “Lenders” shall, unless otherwise expressly indicated, include
Citicorp in its individual capacity. Citicorp and its Affiliates may accept
deposits from, lend money to, act as trustee under indentures of, accept
investment banking engagements from and generally engage in any kind of
business with, the Borrower, any of its Subsidiaries and any Person who may do
business with or own securities of the Borrower or any such Subsidiary, all as
if Citicorp were not the Agent and without any duty to account therefor to the
Lenders. The Agent shall have no duty to disclose information obtained or
received by it or any of its Affiliates relating to the Borrower or its
Subsidiaries to the extent such information was obtained or received in any
capacity other than as Agent.


 


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SECTION 7.04. Lender Credit Decision. Each
Lender acknowledges that it has, independently and without reliance upon the
Agent or any other Lender and based on the financial statements referred to in Section 4.01
and such other documents and information as it has deemed appropriate, made its
own credit analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon the Agent or
any other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Agreement.


 


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


 


(b)           Each
Lender severally agrees to indemnify the Issuing Banks (to the extent not
promptly reimbursed by the Borrower) from and against such Lender’s Ratable
Share of any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever that may be imposed on, incurred by, or asserted against any
such Issuing Bank in any way relating to or arising out of the Loan Documents
or any action taken or omitted by such Issuing Bank hereunder or in connection herewith;
provided, however,
that no Lender shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from such Issuing Bank’s gross negligence
or willful misconduct. Without limitation of the foregoing, each Lender agrees
to reimburse any such Issuing Bank promptly upon demand for its Ratable Share
of any costs and expenses (including, without limitation, fees and expenses of
counsel) payable by the Borrower under Section 8.04, to the extent that
such Issuing Bank is not promptly reimbursed for such costs and expenses by the
Borrower.


 


(c)           The
failure of any Lender to reimburse the Agent or any Issuing Bank promptly upon
demand for its Ratable Share of any amount required to be paid by the Lenders
to the Agent as provided herein shall not relieve any other Lender of its
obligation hereunder to reimburse the Agent or any Issuing Bank for its Ratable
Share of such amount, but no Lender shall be responsible for the failure of any
other Lender to reimburse the Agent or any Issuing Bank for such other Lender’s
Ratable Share of such amount. Without prejudice to the survival of any other
agreement of any Lender hereunder, the agreement and obligations of each Lender
contained in this Section 7.05 shall survive the payment in full of
principal, interest and all other amounts payable hereunder and under the Notes.
Each of the Agent and each Issuing Bank agrees to return to the Lenders their
respective Ratable Shares of any amounts paid under this Section 7.05 that
are subsequently reimbursed by the Borrower.


 


SECTION 7.06. Successor Agent. The Agent
may resign at any time by giving written notice thereof to the Lenders and the
Borrower and may be removed at any time with or without cause by the Required
Lenders. Upon any such resignation or removal, the Required Lenders shall have
the right to appoint a successor Agent with the consent, if no Event of Default
has occurred and is continuing, of the Borrower, which consent shall not be
unreasonably withheld or delayed. If no successor Agent shall have been so
appointed by the Required Lenders, and shall have accepted such appointment,
within 30 days after the retiring Agent’s giving of notice of resignation or
the Required Lenders’ removal of the retiring Agent, then the retiring Agent
may, on behalf of the Lenders, appoint a successor Agent, which shall be a
commercial bank organized under the laws of the United States of America or of
any State thereof and having a combined capital and surplus of at least
$500,000,000. Upon the


 


40





















 


acceptance of any appointment as Agent hereunder by a successor Agent,
such successor Agent shall thereupon succeed to and become vested with all the
rights, powers, discretion, privileges and duties of the retiring Agent, and
the retiring Agent shall be discharged from its duties and obligations under
this Agreement. After any retiring Agent’s resignation or removal hereunder as
Agent, the provisions of this Article VII shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was Agent under this
Agreement.


 


SECTION 7.07. Other Agents. Each Lender
hereby acknowledges that no documentation agent or any other Lender designated
as any “Agent” on the signature pages hereof (other than Citicorp in its
capacity as Agent) has any liability hereunder other than in its capacity as a
Lender.


 


ARTICLE VIII


 


MISCELLANEOUS


 


SECTION 8.01. Amendments, Etc. No
amendment or waiver of any provision of this Agreement or the Revolving Credit
Notes, nor consent to any departure by the Borrower therefrom, shall in any
event be effective unless the same shall be in writing and signed by the
Required Lenders, and then such waiver or consent shall be effective only in
the specific instance and for the specific purpose for which given; provided,
however, that no amendment, waiver or consent shall, unless in writing
and signed by all the Lenders, do any of the following:  (a) waive any of the conditions
specified in Section 3.01, (b) increase the Revolving Credit
Commitments of the Lenders other than as provided in Section 2.19, (c) reduce
the principal of, or interest on, the Revolving Credit Advances or any fees or
other amounts payable hereunder, (d) postpone any date fixed for any
payment of principal of, or interest on, the Revolving Credit Advances or any
fees or other amounts payable hereunder, (e) change the percentage of the
Revolving Credit Commitments or of the aggregate unpaid principal amount of the
Revolving Credit Advances, or the number of Lenders, that shall be required for
the Lenders or any of them to take any action hereunder, (f) release any
of the collateral in the L/C Securities Account other than in accordance with
the terms hereof or (g) amend this Section 8.01; and provided  further
that (x) no amendment, waiver or consent shall, unless in writing and signed by
the Agent in addition to the Lenders required above to take such action, affect
the rights or duties of the Agent under this Agreement or any Note and (y) no
amendment, waiver or consent shall, unless in writing and signed by each
Issuing Bank adversely affected thereby in addition to the Lenders required
above to take such action, affect the rights or obligations of such Issuing
Bank in its capacity as such under this Agreement.


 


SECTION 8.02. Notices, Etc. (a)  All
notices and other communications provided for hereunder shall be either (x) in
writing (including telecopier or telegraphic communication) and mailed, telecopied,
telegraphed or delivered or (y) as and to the extent set forth in Section 8.02(b) and
in the proviso to this Section 8.02(a), if to the Borrower, at its address
at 385 Washington Street, St. Paul, Minnesota 55102 (with a copy to One Tower
Square, Hartford, Connecticut 06183), Attention:  Senior Vice President and Treasurer, with a
copy to Corporate Secretary, if to any Initial Lender, at its Domestic Lending
Office specified opposite its name on Schedule I hereto; if to any other
Lender, at its Domestic Lending Office specified in the Assumption Agreement or
the Assignment and Acceptance pursuant to which it became a Lender; and if to
the Agent, at its address at Two Penns Way, New Castle, Delaware 19720,
Attention: Bank Loan Syndications Department; or, as to the Borrower or the
Agent, at such other address as shall be designated by such party in a written
notice to the other parties and, as to each other party, at such other address
as shall be designated by such party in a written notice to the Borrower and
the Agent, provided that materials required to be delivered pursuant to Section 5.01(i)(i),
(ii), (iii) or (iv) shall be delivered to the Agent as specified in Section 8.02(b) or
as otherwise specified to the Borrower by the Agent. All such notices and
communications shall, when mailed, telecopied, telegraphed or e-mailed, be
effective when deposited in the mails, telecopied, delivered to the telegraph
company or confirmed by e-mail, respectively, except that notices and
communications to the Agent pursuant to Article II, III or VII shall
not be effective until received by the Agent. Delivery by telecopier of an
executed counterpart of any amendment or waiver of any provision of this
Agreement or the Notes or of any Exhibit hereto to be executed and
delivered hereunder shall be effective as delivery of a manually executed
counterpart thereof.


 


(b)           If the Borrower and the Agent agree
that an electronic medium may be used for the distribution of material, so long
as Citicorp or any of its Affiliates is the Agent, materials required to be
delivered pursuant to Section 5.01(i)(i), (ii), (iii) and (iv) may
be delivered to the Agent in an electronic medium in a format acceptable to the
Agent and the Lenders by e-mail at oploanswebadmin@citigroup.com. The Borrower
agrees that


 


41





















 


the Agent may make such materials, as well as any other written
information, documents, instruments and other material relating to the
Borrower, any of its Subsidiaries or any other materials or matters relating to
this Agreement, the Notes or any of the transactions contemplated hereby
(collectively, the “Communications”) available to the Lenders by posting
such notices on Intralinks or a substantially similar electronic system (the “Platform”).


 


(c)           Each
Lender agrees that notice to it (as provided in the next sentence) (a “Notice”)
specifying that any Communications have been posted to the Platform shall constitute effective delivery of such
information, documents or other materials to such Lender for purposes of this
Agreement; provided that if requested by any Lender the Agent shall
deliver a copy of the Communications to such Lender by email or telecopier. Each
Lender agrees (i) to notify the Agent in writing of such Lender’s

e-mail address to which a Notice may be sent by electronic transmission
(including by electronic communication) on or before the date such Lender
becomes a party to this Agreement (and from time to time thereafter to ensure
that the Agent has on record an effective e-mail address for such Lender) and (ii) that
any Notice may be sent to such
e-mail address.


 


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


 


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


 


(b)           The Borrower agrees to indemnify and
hold harmless the Agent and each Lender and each of their Affiliates and their
officers, directors, employees, agents and advisors (each, an “Indemnified
Party”) from and against any and all claims, damages, losses, liabilities
and expenses (including, without limitation, reasonable fees and expenses of
counsel) incurred by or asserted or awarded against any Indemnified Party, in
each case arising out of or in connection with or by reason of (including,
without limitation, in connection with any investigation, litigation or proceeding
or preparation of a defense in connection therewith) the Notes, this Agreement,
any of the transactions contemplated herein or the actual or proposed use of
the proceeds of the Advances or Letters of Credit, except to the extent such
claim, damage, loss, liability or expense is found in a final, non-appealable
judgment by a court of competent jurisdiction to have resulted from such
Indemnified Party’s gross negligence or willful misconduct. In the case of an
investigation, litigation or other proceeding to which the indemnity in this Section 8.04(b) applies,
such indemnity shall be effective whether or not such investigation, litigation
or proceeding is brought by the Borrower, its directors, equityholders or
creditors or an Indemnified Party or any other Person, whether or not any
Indemnified Party is otherwise a party thereto and whether or not the
transactions contemplated hereby are consummated. The Borrower also agrees not
to assert any claim for special, indirect, consequential or punitive damages
against the Agent, any Lender, any of their Affiliates, or any of their
respective directors, officers, employees, attorneys and agents, on any theory
of liability, arising out of or otherwise relating to the Notes, this
Agreement, any of the transactions contemplated herein or the actual or
proposed use of the proceeds of the Advances.


 


(c)           If any payment of principal of, or
Conversion of, any Eurodollar Rate Advance or LIBO Rate Advance is made by the
Borrower to or for the account of a Lender other than on the last day of the
Interest Period for such Advance, as a result of a payment or Conversion
pursuant to Section 2.09(d) or (e), 2.11 or 2.13, acceleration of the
maturity of the Notes pursuant to Section 6.01 or for any other reason, or
by an Eligible Assignee to a Lender other than on the last day of the Interest
Period for such Advance upon an assignment of rights and obligations under this
Agreement pursuant to Section 8.07 as a result of a demand by the Borrower
pursuant to


 


42





















 


Section 8.07(a), the Borrower shall, upon demand by such Lender
(with a copy of such demand to the Agent), pay to the Agent for the account of
such Lender any amounts required to compensate such Lender for any additional
losses, costs or expenses that it may reasonably incur as a result of such
payment or Conversion, including, without limitation, any loss (excluding loss
of anticipated profits), cost or expense incurred by reason of the liquidation
or reemployment of deposits or other funds acquired by any Lender to fund or
maintain such Advance.


 


(d)           Without prejudice to the survival of
any other agreement of the Borrower hereunder, the agreements and obligations
of the Borrower contained in Sections 2.12, 2.15 and 8.04 shall survive
the payment in full of principal, interest and all other amounts payable
hereunder and under the Notes.


 


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


 


SECTION 8.06. Binding Effect. This
Agreement shall become effective (other than Sections 2.01 and 2.04, which
shall only become effective upon satisfaction of the conditions precedent set
forth in Section 3.01) when it shall have been executed by the Borrower
and the Agent and when the Agent shall have been notified by each Initial
Lender that such Initial Lender has executed it and thereafter shall be binding
upon and inure to the benefit of the Borrower, the Agent and each Lender and
their respective successors and assigns, except that the Borrower shall not
have the right to assign its rights hereunder or any interest herein without
the prior written consent of the Lenders.


 


SECTION 8.07. Assignments and Participations.
(a)  Each Lender may and, if demanded by the Borrower in accordance with Section 2.21,
upon at least five Business Days’ notice to such Lender and the Agent, will
assign to one or more Persons all or a portion of its rights and obligations
under this Agreement (including, without limitation, all or a portion of its
Revolving Credit Commitment, the Advances owing to it, its participations in
Letters of Credit and the Note or Notes held by it); provided, however,
that (i) each such assignment shall be of a constant, and not a varying,
percentage of all rights and obligations under this Agreement (other than any
right to make Competitive Bid Advances, Competitive Bid Advances owing to it
and Competitive Bid Notes), (ii) except in the case of an assignment to a
Person that, immediately prior to such assignment, was a Lender or an
assignment of all of a Lender’s rights and obligations under this Agreement,
the amount of the Revolving Credit Commitment of the assigning Lender being
assigned pursuant to each such assignment (determined as of the date of the
Assignment and Acceptance with respect to such assignment) shall in no event be
less than $10,000,000 or an integral multiple of $1,000,000 in excess thereof,
unless the Borrower and the Agent otherwise agree, (iii) each such
assignment shall be to an Eligible Assignee, (iv) each such assignment
made as a result of a demand by the Borrower pursuant to this Section 8.07(a) shall
be arranged by the Borrower after consultation with the Agent and shall be
either an assignment of all of the rights and obligations of the assigning
Lender under this Agreement or an assignment of a portion of such rights and
obligations made concurrently with another such assignment or other such
assignments that together cover all of the rights and obligations of the
assigning Lender under this Agreement, (v) no Lender shall be obligated to
make any such assignment as a result of a demand by the Borrower pursuant to
this Section 8.07(a) unless and until such Lender shall have received
one or more payments from either the Borrower or one or more Eligible Assignees
in an aggregate amount at least equal to the aggregate outstanding principal
amount of the Advances owing to such Lender, together with accrued interest
thereon to the date of payment of such principal amount and all other amounts
payable to such Lender under this Agreement, and (vi) the parties to each
such assignment shall execute and deliver to the Agent, for its acceptance and
recording in the Register, an Assignment and Acceptance, together with any
Revolving Credit Note subject to such assignment and a processing and
recordation fee of $3,500 payable by the assignor or the Eligible Assignee, as
applicable, provided, however,


 


43





















 


that in the case of each assignment made as a result of a demand by the
Borrower, such recordation fee shall be payable by the Borrower except that no
such recordation fee shall be payable in the case of an assignment made at the
request of the Borrower to an Eligible Assignee that is an existing Lender, and
(vii) any Lender may, without the approval of the Borrower and the Agent,
assign all or a portion of its rights to any of its Affiliates. Upon such
execution, delivery, acceptance and recording, from and after the effective
date specified in each Assignment and Acceptance, (x) the assignee
thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment and
Acceptance, have the rights and obligations of a Lender hereunder and
(y) the Lender assignor thereunder shall, to the extent that rights and
obligations hereunder have been assigned by it pursuant to such Assignment and
Acceptance, relinquish its rights (other than its rights under Section 2.12,
2.15 and 8.04 to the extent any claim thereunder relates to an event arising
prior such assignment) and be released from its obligations (other than its
obligations under Section 8.05 to the extent any claim thereunder relates
to an event arising prior to such assignment) under this Agreement (and, in the
case of an Assignment and Acceptance covering all or the remaining portion of
an assigning Lender’s rights and obligations under this Agreement, such Lender
shall cease to be a party hereto).


 


(b)           By executing and delivering an
Assignment and Acceptance, the Lender assignor thereunder and the assignee
thereunder confirm to and agree with each other and the other parties hereto as
follows:  (i) other than as provided
in such Assignment and Acceptance, such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of, or the perfection or priority of any lien or security
interest created or purported to be created under or in connection with, this
Agreement or any other instrument or document furnished pursuant hereto; (ii) such
assigning Lender makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrower or the
performance or observance by the Borrower of any of its obligations under this
Agreement or any other instrument or document furnished pursuant hereto; (iii) such
assignee confirms that it has received a copy of this Agreement, together with
copies of the financial statements referred to in Section 4.01 and such
other documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into such Assignment and Acceptance; (iv) such
assignee will, independently and without reliance upon the Agent, such
assigning Lender or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement; (v) such
assignee confirms that it is an Eligible Assignee; (vi) such assignee
appoints and authorizes the Agent to take such action as agent on its behalf
and to exercise such powers and discretion under this Agreement as are
delegated to the Agent by the terms hereof, together with such powers and discretion
as are reasonably incidental thereto; and (vii) such assignee agrees that
it will perform in accordance with their terms all of the obligations that by
the terms of this Agreement are required to be performed by it as a Lender.


 


(c)           Upon its receipt of an Assignment and
Acceptance executed by an assigning Lender and an assignee representing that it
is an Eligible Assignee, together with any Revolving Credit Note or Notes
subject to such assignment, the Agent shall, if such Assignment and Acceptance has
been completed and is in substantially the form of Exhibit C hereto, (i) accept
such Assignment and Acceptance, (ii) record the information contained
therein in the Register and (iii) give prompt notice thereof to the
Borrower.


 


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


 


(e)           Each Lender may sell participations
to one or more banks or other entities (other than the Borrower or any of its
Affiliates) in or to all or a portion of its rights and obligations under this
Agreement (including, without limitation, all or a portion of its Commitment,
the Advances owing to it and any Note or Notes held by it); provided, however,
that (i) such Lender’s obligations under this Agreement (including,
without limitation, its Commitment to the Borrower hereunder) shall remain
unchanged, (ii) such Lender shall remain solely


 


44





















 


responsible to the other parties hereto for the performance of such
obligations, (iii) such Lender shall remain the holder of any such Note
for all purposes of this Agreement, (iv) the Borrower, the Agent and the
other Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender’s rights and obligations under this Agreement and (v) no
participant under any such participation shall have any right to approve any
amendment or waiver of any provision of this Agreement or any Note, or any
consent to any departure by the Borrower therefrom, except to the extent that
such amendment, waiver or consent would reduce the principal of, or interest on,
the Notes or any fees or other amounts payable hereunder, in each case to the
extent subject to such participation, or postpone any date fixed for any
payment of principal of, or interest on, the Notes or any fees or other amounts
payable hereunder, in each case to the extent subject to such participation.


 


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


 


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


 


SECTION 8.08. Confidentiality. Neither the
Agent nor any Lender shall disclose any Confidential Information to any other
Person without the consent of the Borrower, other than (a) to the Agent’s
or such Lender’s Affiliates and their officers, directors, employees, agents
and advisors in connection with the performance of this Agreement with the
Agent or such Lender being responsible for compliance by the Agent’s or such
Lender’s Affiliates and their officers, directors, employees, agents and
advisors with the provisions of this Section 8.08 and, as contemplated by Section 8.07(f),
to actual or prospective assignees and participants, and then only on a
confidential basis, (b) as required by any law, rule or regulation or
judicial process, (c) as requested or required by any state, federal or
foreign authority or examiner regulating banks, banking or other financial
institutions or self-regulatory body and (d) in connection with the
exercise of any remedies hereunder or any suit, action or proceeding relating
to this Agreement or the enforcement of rights hereunder.


 


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


 


SECTION 8.10. Execution in Counterparts. This
Agreement may be executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which when so executed shall
be deemed to be an original and all of which taken together shall constitute
one and the same agreement. Delivery of an executed counterpart of a signature page to
this Agreement by telecopier shall be effective as delivery of a manually
executed counterpart of this Agreement.


 


SECTION 8.11. Jurisdiction, Etc. (a) 
Each of the parties hereto hereby irrevocably and unconditionally submits, for
itself and its property, to the nonexclusive jurisdiction of any New York
State court or federal court of the United States of America sitting in
New York City, and any appellate court from any thereof, in any action or
proceeding arising out of or relating to this Agreement or the Notes, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in any such New York
State court or, to the extent permitted by law, in such federal court. The
Borrower hereby irrevocably consents to the service of process in any action or
proceeding in such courts by the mailing thereof by any parties hereto by
registered or certified mail, postage prepaid, to the Borrower at its address
specified pursuant to Section 8.02. Each of the parties hereto agrees that
a final judgment in any such action or proceeding shall be conclusive and may
be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law. Nothing in this Agreement shall affect any right that
any party may otherwise have to bring any action or proceeding relating to this
Agreement or the Notes in the courts of any jurisdiction.


 


45





















 


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


 


SECTION 8.12. 
No Liability of the Issuing Banks.  Subject to the next sentence, the Borrower
assumes all risks of the acts or omissions of any beneficiary or transferee of
any Letter of Credit with respect to its use of such Letter of Credit.  Neither an Issuing Bank nor any of its
officers or directors shall be liable or responsible for:  (a) the use that may be made of any
Letter of Credit or any acts or omissions of any beneficiary or transferee in
connection therewith; (b) the validity, sufficiency or genuineness of
documents, or of any endorsement thereon, even if such documents should prove
to be in any or all respects invalid, insufficient, fraudulent or forged; (c) payment
by such Issuing Bank against presentation of documents that do not comply with
the terms of a Letter of Credit, including failure of any documents to bear any
reference or adequate reference to the Letter of Credit; or (d) any other
circumstances whatsoever in making or failing to make payment under any Letter
of Credit, except that the Borrower shall have a claim against such Issuing
Bank, and such Issuing Bank shall be liable to the Borrower, to the extent of
any direct, but not consequential, damages suffered by the Borrower that the
Borrower proves were caused by such Issuing Bank’s willful misconduct or gross
negligence when determining whether drafts and other documents presented under
a Letter of Credit comply with the terms thereof.  In furtherance and not in limitation of the
foregoing, such Issuing Bank 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; provided that nothing herein
shall be deemed to excuse such Issuing Bank if it acts with gross negligence or
willful misconduct in accepting such documents.


 


SECTION 8.13. 
Patriot Act.  Each Lender
hereby notifies the Borrower that pursuant to the requirements of the USA
Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the “Act”), it is required to obtain, verify and record information
that identifies each borrower, guarantor or grantor (the “Loan Parties”), which
information includes the name and address of each Loan Party and other
information that will allow such Lender to identify such Loan Party in
accordance with the Act.


 


46





















 


SECTION 8.14. 
Waiver of Jury Trial.  Each
of the Borrower, the Agent and the Lenders hereby irrevocably waives all right
to trial by jury in any action, proceeding or counterclaim (whether based on
contract, tort or otherwise) arising out of or relating to this Agreement or
the Notes or the actions of the Agent or any Lender in the negotiation,
administration, performance or enforcement thereof.


 


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


 


	
   

  	
  THE ST. PAUL
  TRAVELERS COMPANIES, INC.

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  
	
   

  	
   

  
	
   

  	
  CITICORP USA,
  INC.,

  
	
   

  	
   

  	
    as
  Agent

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  
	
   

  	
   

  
	
  Initial Lenders

  
	
   

  	
   

  
	
  Commitment

  	
   

  
	
   

  	
   

  
	
  $125,000,000

  	
  CITICORP USA,
  INC.

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  
	
   

  	
   

  
	
  $125,000,000

  	
  JPMORGAN CHASE
  BANK, N.A.

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  
	
   

  	
   

  
	
  $75,000,000

  	
  BANK OF AMERICA,
  N.A.

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  
	
   

  	
   

  
	
  $75,000,000

  	
  THE BANK OF NEW
  YORK

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  
	
   

  	
   

  
	
  $75,000,000

  	
  WELLS FARGO
  BANK, NATIONAL

  
	
   

  	
  ASSOCIATION

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  



 


47





















 


	
  $75,000,000

  	
  THE ROYAL BANK
  OF SCOTLAND PLC

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  
	
   

  	
   

  
	
  $60,000,000

  	
  DEUTSCHE BANK AG
  NEW YORK BRANCH

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  
	
   

  	
   

  
	
  $60,000,000

  	
  LEHMAN BROTHERS
  BANK, FSB

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  
	
   

  	
   

  
	
  $60,000,000

  	
  MERRILL LYNCH
  BANK USA

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  
	
   

  	
   

  
	
  $60,000,000

  	
  MORGAN STANLEY
  BANK

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  
	
   

  	
   

  
	
  $60,000,000

  	
  WACHOVIA BANK,
  NATIONAL ASSOCIATION

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  
	
   

  	
   

  
	
  $60,000,000

  	
  WILLIAM STREET
  COMMITMENT

  
	
   

  	
  CORPORATION

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  
	
   

  	
   

  
	
  $30,000,000

  	
  HSBC BANK USA,
  N.A.

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  
	
   

  	
   

  
	
  $30,000,000

  	
  ROYAL BANK OF
  CANADA

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  
	
   

  	
   

  
	
  $30,000,000

  	
  U.S. BANK,
  NATIONAL ASSOCIATION

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  
	
   

  	
   

  
	
  $1,000,000,000

  	
  Total of the
  Revolving Credit Commitments

  
					



 


48





















 


	
  Initial Issuing Banks

  
	
   

  	
   

  
	
  Letter of Credit
  Commitment

  	
   

  
	
   

  	
   

  
	
  $125,000,000

  	
  CITICORP USA,
  INC.

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  
	
   

  	
   

  
	
  $125,000,000

  	
  JPMORGAN CHASE
  BANK, N.A.

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
    Title:

  
	
   

  	
   

  
	
  $250,000,000

  	
  Total of the
  Letter of Credit Commitments

  
					



 


49





















 


SCHEDULE I


THE ST. PAUL TRAVELERS COMPANIES, INC.


FIVE YEAR CREDIT AGREEMENT


APPLICABLE LENDING OFFICES


 


	
  Name
  of Initial Lender

  	
   

  	
  Domestic Lending Office

  	
   

  	
  Eurodollar Lending Office

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Citicorp
  USA, Inc.

  	
   

  	
  2 Penns Way

  	
   

  	
  2 Penns Way

  
	
   

  	
   

  	
  New Castle, DE
  19720

  	
   

  	
  New Castle, DE
  19720

  
	
   

  	
   

  	
  Attn: Bank Loans
  Syndication

  	
   

  	
  Attn: Bank Loans
  Syndication

  
	
   

  	
   

  	
  T: 302 894-

  	
   

  	
  T: 302 894-

  
	
   

  	
   

  	
  F: 302 894-6120

  	
   

  	
  F: 302 894-6120

  
	
  The Bank of New
  York

  	
   

  	
  One Wall Street

  	
   

  	
  One Wall Street

  
	
   

  	
   

  	
  New York, NY
  10286

  	
   

  	
  New York, NY
  10286

  
	
   

  	
   

  	
  Annette Harewood

  	
   

  	
  Annette Harewood

  
	
   

  	
   

  	
  T: 212 635-6379

  	
   

  	
  T: 212 635-6379

  
	
   

  	
   

  	
  F: 212 809-9520

  	
   

  	
  F: 212 809-9520

  
	
  Bank of America,
  N.A.

  	
   

  	
  1850 Gateway
  Blvd.

  	
   

  	
  1850 Gateway
  Blvd.

  
	
   

  	
   

  	
  Concord, CA
  94520

  	
   

  	
  Concord, CA
  94520

  
	
   

  	
   

  	
  Attn: Tina
  Obcena

  	
   

  	
  Attn: Tina
  Obcena

  
	
   

  	
   

  	
  T: 925 675-8768

  	
   

  	
  T: 925 675-8768

  
	
   

  	
   

  	
  F: 888 969-9246

  	
   

  	
  F: 888 969-9246

  
	
  Deutsche Bank AG
  New York Branch

  	
   

  	
   

  	
   

  	
   

  
	
  HSBC Bank USA,
  N.A.

  	
   

  	
   

  	
   

  	
   

  
	
  JPMorgan Chase
  Bank, N.A.

  	
   

  	
  1 Chase
  Manhattan Plaza,

  	
   

  	
  1 Chase
  Manhattan Plaza,

  
	
   

  	
   

  	
  8th
  Floor

  	
   

  	
  8th
  Floor

  
	
   

  	
   

  	
  New York, NY
  10081

  	
   

  	
  New York, NY
  10081

  
	
   

  	
   

  	
  Attn: Laura
  Rebecca

  	
   

  	
  Attn: Laura
  Rebecca

  
	
   

  	
   

  	
  T: 212 552-7253

  	
   

  	
  T: 212 552-7253

  
	
   

  	
   

  	
  F: 212 552-7490

  	
   

  	
  F: 212 552-7490

  
	
  Lehman Brothers
  Bank, FSB

  	
   

  	
   

  	
   

  	
   

  
	
  Merrill Lynch
  Bank USA

  	
   

  	
   

  	
   

  	
   

  
	
  Morgan Stanley
  Bank

  	
   

  	
   

  	
   

  	
   

  
	
  Royal Bank of
  Canada

  	
   

  	
  One Liberty
  Plaza, 4th Floor

  	
   

  	
  One Liberty
  Plaza, 4th Floor

  
	
   

  	
   

  	
  New York, NY
  10006

  	
   

  	
  New York, NY
  10006

  
	
   

  	
   

  	
  Attn: Linda
  Joannou

  	
   

  	
  Attn: Linda
  Joannou

  
	
   

  	
   

  	
  T: 212 428-6212

  	
   

  	
  T: 212 428-6212

  
	
   

  	
   

  	
  F: 212 428-2372

  	
   

  	
  F: 212 428-2372

  
	
  The Royal Bank
  of Scotland plc

  	
   

  	
   

  	
   

  	
   

  
	
  Wachovia Bank,
  National Association

  	
   

  	
   

  	
   

  	
   

  
	
  Wells Fargo
  Bank, National Association

  	
   

  	
  6th
  Street and Marquette Avenue

  	
   

  	
  6th
  Street and Marquette Avenue

  
	
   

  	
   

  	
  Minneapolis, MN
  55479

  	
   

  	
  Minneapolis, MN
  55479

  
	
   

  	
   

  	
  Attn: Jari
  Norris

  	
   

  	
  Attn: Jari
  Norris

  
	
   

  	
   

  	
  T: 612 667-9107

  	
   

  	
  T: 612 667-9107

  
	
   

  	
   

  	
  F: 612 667-7251

  	
   

  	
  F: 612 667-7251

  
	
  William Street
  Commitment Corporation

  	
   

  	
   

  	
   

  	
   

  



 


50





















 


	
  U.S. Bank,
  National Association

  	
   

  	
  601 Second
  Avenue South

  	
   

  	
  601 Second
  Avenue South

  
	
   

  	
   

  	
  Minneapolis, MN
  55402

  	
   

  	
  Minneapolis, MN
  55402

  
	
   

  	
   

  	
  Attn: Timothy
  Gallaher

  	
   

  	
  Attn: Timothy
  Gallaher

  
	
   

  	
   

  	
  T: 612 973-3897

  	
   

  	
  T: 612 973-3897

  
	
   

  	
   

  	
  F: 612 973-0825

  	
   

  	
  F: 612 973-0825

  



 


51





















 


Schedule 2.01(b) –
Existing Letters of Credit


 


None.


 





















 


Schedule 3.01(b) -
Disclosed Litigation


 


Please see the Public Filings listed below:


 


•                  1Q 2005 Form 10-Q


 


•                  2004 Annual Report


 


•                  Current Reports on Form 8-K
filed February 3, 2005, February 4, 2005, March 18, 2005, March 25,
2005, March 30, 2005, April 1, 2005, April 11, 2005, April 12,
2005, April 18, 2005, May 5, 2005, May 9, 2005 and May 13,
2005


 


2





















 


Schedule 4.01(e) -
Accounting Matters


 


On July 23,
2004, the Borrower announced that it was seeking guidance from the staff of the
Division of Corporation Finance of the Securities and Exchange Commission with
respect to the appropriate purchase accounting treatment for certain second
quarter 2004 adjustments totaling $1.63 billion ($1.07 billion
after-tax).  The Borrower recorded these adjustments as charges in its
income statement in the second quarter of 2004.  Through an informal
comment process, the staff of the Division of Corporation Finance has
subsequently asked for further information relating to these adjustments, and
the dialogue is ongoing.  Specifically, the staff has asked for
information concerning the Borrower’s adjustments to certain of SPC’s insurance
reserves and reserves for reinsurance recoverables and premiums due from policyholders,
and how those adjustments may relate to SPC’s reserves for periods prior to the
merger.  After reviewing the staff’s questions and comments, the Borrower
continues to believe that its accounting treatment for these adjustments is
appropriate.  If, however, the staff disagrees, some or all of the
adjustments being discussed may not be recorded as charges in the Borrower’s
income statement, thereby increasing net income for the second quarter and full
year 2004 and increasing shareholders’ equity at December 31, 2004 and March 31,
2005, in each case by the approximate after-tax amount of the charge.  The
effect on tangible shareholders’ equity at December 31, 2004 and March 31,
2005 would not be material.  Additionally, if such adjustments were made,
there would be changes to the amounts recorded for the affected items in
purchase accounting and, accordingly, the Borrower’s balance sheet as of April 1,
2004 would reflect those changes.


 


3





















 


Schedule 5.02(a) -
Existing Liens


 


None.


 


4





















 


EXHIBIT A-1 -
FORM OF


REVOLVING CREDIT


PROMISSORY NOTE


 


	
  U.S.$

  	
   

  	
  Dated:
                      ,
  200   

  



 


FOR
VALUE RECEIVED, the undersigned, THE ST. PAUL TRAVELERS COMPANIES, INC., a
Minnesota corporation (the “Borrower”), HEREBY PROMISES TO PAY to the
order of                              
(the “Lender”) for the account of its Applicable Lending Office on the
later of the Termination Date and the date designated pursuant to Section 2.07
of the Credit Agreement (each as defined in the Credit Agreement referred to
below) the principal sum of U.S.$[amount of the Lender’s Commitment in figures]
or, if less, the aggregate principal amount of the Revolving Credit Advances
made by the Lender to the Borrower pursuant to the Five Year Credit Agreement
dated as of June 10, 2005 among the Borrower, the Lender and certain other
lenders parties thereto, JPMorgan Chase Bank, N.A., as syndication agent, Bank
of America, N.A., The Bank of New York and Wells Fargo Bank, National
Association, as documentation agents, Citigroup Global Markets Inc. and J.P.
Morgan Securities Inc., as joint lead arrangers, and Citicorp USA, Inc. as
Agent for the Lender and such other lenders (as amended or modified from time
to time, the “Credit Agreement”; the terms defined therein being used
herein as therein defined) outstanding on such date.


 


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


 


Both
principal and interest are payable in lawful money of the United States of
America to Citicorp, as Agent, at 388 Greenwich Street, New York, New York
10013, in same day funds.  Each Revolving
Credit Advance owing to the Lender by the Borrower pursuant to the Credit
Agreement, and all payments made on account of principal thereof, shall be recorded
by the Lender and, prior to any transfer hereof, endorsed on the grid attached
hereto which is part of this Promissory Note.


 


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


 


	
   

  	
  THE ST. PAUL
  TRAVELERS COMPANIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  



 





















 


ADVANCES AND PAYMENTS OF PRINCIPAL


 


	
  Date

  	
   

  	
  Amount of

  Advance

  	
   

  	
  Amount of

  Principal Paid

  or Prepaid

  	
   

  	
  Unpaid Principal

  Balance

  	
   

  	
  Notation

  Made By

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


2





















 


EXHIBIT A-2 -
FORM OF


COMPETITIVE BID


PROMISSORY NOTE


 


	
  U.S.$

  	
   

  	
  Dated:
                      ,
  200   

  



 


FOR
VALUE RECEIVED, the undersigned, THE ST. PAUL TRAVELERS COMPANIES, INC., a
Minnesota corporation (the “Borrower”), HEREBY PROMISES TO PAY to the
order of                                
(the “Lender”) for the account of its Applicable Lending Office (as
defined in the Five Year Credit Agreement dated as of June 10, 2005 among
the Borrower, the Lender and certain other lenders parties thereto, JPMorgan
Chase Bank, N.A., as syndication agent, Bank of America, N.A., The Bank of New
York and Wells Fargo Bank, National Association, as documentation agents,
Citigroup Global Markets Inc. and J.P. Morgan Securities Inc., as joint lead
arrangers, and Citicorp USA, Inc., as Agent for the Lender and such other
lenders (as amended or modified from time to time, the “Credit Agreement”;
the terms defined therein being used herein as therein defined)), on                                ,
200  , the principal amount of U.S.$                               ].


 


The
Borrower promises to pay interest on the unpaid principal amount hereof from
the date hereof until such principal amount is paid in full, at the interest
rate and payable on the interest payment date or dates provided below:


 


Interest
Rate:                  %
per annum (calculated on the basis of a year of                  
days for the actual number of days elapsed).


 


Both
principal and interest are payable in lawful money of the United States of
America to Citicorp, as agent, for the account of the Lender at the office of
Citicorp, at Two Penns Way, New Castle, Delaware 19720 in same day funds.


 


This
Promissory Note is one of the Competitive Bid Notes referred to in, and is
entitled to the benefits of, the Credit Agreement.  The Credit Agreement, among other things, contains
provisions for acceleration of the maturity hereof upon the happening of
certain stated events.


 


The
Borrower hereby waives presentment, demand, protest and notice of any
kind.  No failure to exercise, and no
delay in exercising, any rights hereunder on the part of the holder hereof
shall operate as a waiver of such rights.


 


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


 


	
   

  	
  THE ST. PAUL
  TRAVELERS COMPANIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
   Title:

  



 





















 


EXHIBIT B-1 -
FORM OF NOTICE OF


REVOLVING CREDIT BORROWING


 


Citicorp USA, Inc., as Agent

for the Lenders parties

to the Credit Agreement

referred to below

Two Penns Way

New Castle, Delaware 19720


 


[Date]


 


Attention:
Bank Loan Syndications Department


 


Ladies and Gentlemen:


 


The
undersigned, The St. Paul Travelers Companies, Inc., refers to the Five
Year Credit Agreement, dated as of June 10, 2005 (as amended or modified
from time to time, the “Credit Agreement”, the terms defined therein
being used herein as therein defined), among the undersigned, certain Lenders
parties thereto, JPMorgan Chase Bank, N.A., as syndication agent, Bank of
America, N.A., The Bank of New York and Wells Fargo Bank, National Association,
as documentation agents, Citigroup Global Markets Inc. and J.P. Morgan
Securities Inc., as joint lead arrangers, and Citicorp USA, Inc., as Agent
for said Lenders, and hereby gives you notice, irrevocably, pursuant to Section 2.02
of the Credit Agreement that the undersigned hereby requests a Revolving Credit
Borrowing under the Credit Agreement, and in that connection sets forth below
the information relating to such Revolving Credit Borrowing (the “Proposed
Revolving Credit Borrowing”) as required by Section 2.02(a) of
the Credit Agreement:


 


(i)            The
Business Day of the Proposed Revolving Credit Borrowing is                        ,
200  .


 


(ii)           The
Type of Advances comprising the Proposed Revolving Credit Borrowing is [Base
Rate Advances] [Eurodollar Rate Advances].


 


(iii)          The
aggregate amount of the Proposed Revolving Credit Borrowing is $                                  .


 


[(iv)         The
initial Interest Period for each Eurodollar Rate Advance made as part of the
Proposed Revolving Credit Borrowing is           
month[s].]


 


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


 


(A)          the
representations and warranties contained in Section 4.01 of the Credit
Agreement (except the representations set forth in the last sentence of subsection (e) thereof
and in subsection (f) thereof) are correct, before and after giving
effect to the Proposed Revolving Credit Borrowing and to the application of the
proceeds therefrom, as though made on and as of such date; and


 





















 


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


 


	
   

  	
  Very truly
  yours,

  
	
   

  	
   

  
	
   

  	
  THE ST. PAUL
  TRAVELERS COMPANIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
   Title:.

  



 


2





















 


EXHIBIT B-2 -
FORM OF NOTICE OF


COMPETITIVE BID BORROWING


 


Citicorp USA, Inc., as Agent

for the Lenders parties

to the Credit Agreement

referred to below

Two Penns Way

New Castle, Delaware 19720


 


[Date]


 


Attention:
Bank Loan Syndications Department


 


Ladies and Gentlemen:


 


The
undersigned, The St. Paul Travelers Companies, Inc., refers to the Five
Year Credit Agreement, dated as of June 10, 2005 (as amended or modified
from time to time, the “Credit Agreement”, the terms defined therein
being used herein as therein defined), among the undersigned, certain Lenders
parties thereto, JPMorgan Chase Bank, N.A., as syndication agent, Bank of
America, N.A., The Bank of New York and Wells Fargo Bank, National Association,
as documentation agents, Citigroup Global Markets Inc. and J.P. Morgan
Securities Inc., as joint lead arrangers, and Citicorp USA, Inc., as Agent
for said Lenders, and hereby gives you notice, irrevocably, pursuant to Section 2.04
of the Credit Agreement that the undersigned hereby requests a Competitive Bid
Borrowing under the Credit Agreement, and in that connection sets forth the
terms on which such Competitive Bid Borrowing (the “Proposed Competitive Bid
Borrowing”) is requested to be made:


 


	
  (A)

  	
   

  	
  Date of
  Competitive Bid Borrowing

  	
   

  	
   

  
	
  (B)

  	
   

  	
  Amount of
  Competitive Bid Borrowing

  	
   

  	
   

  
	
  (C)

  	
   

  	
  [Maturity Date]
  [Interest Period]

  	
   

  	
   

  
	
  (D)

  	
   

  	
  Interest Rate
  Basis

  	
   

  	
   

  
	
  (E)

  	
   

  	
  Interest Payment
  Date(s)

  	
   

  	
   

  
	
  (F)

  	
   

  	
   

  	
   

  	
   

  



 


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


 


(a)           the
representations and warranties contained in Section 4.01 of the Credit
Agreement (except the representations set forth in the last sentence of subsection (e) thereof
and in subsection (f) thereof) are correct, before and after giving
effect to the Proposed Competitive Bid Borrowing and to the application of the
proceeds therefrom, as though made on and as of such date;


 


(b)           no
event has occurred and is continuing, or would result from the Proposed
Competitive Bid Borrowing or from the application of the proceeds therefrom,
that constitutes a Default; and


 


(c)           the
aggregate amount of the Proposed Competitive Bid Borrowing and all other
Borrowings to be made on the same day under the Credit Agreement is within the
aggregate amount of the unused Commitments of the Lenders.


 


The
undersigned hereby confirms that the Proposed Competitive Bid Borrowing is to
be made available to it in accordance with Section 2.04(a)(v) of the
Credit Agreement.


 





















 


	
   

  	
  Very truly
  yours,

  
	
   

  	
   

  
	
   

  	
  THE ST. PAUL
  TRAVELERS COMPANIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  



 


2





















 


EXHIBIT C - FORM OF


ASSIGNMENT AND ACCEPTANCE


 


Reference
is made to the Five Year Credit Agreement dated as of June 10, 2005 (as
amended or modified from time to time, the “Credit Agreement”) among The
St. Paul Travelers Companies, Inc., a Minnesota corporation (the “Borrower”),
the Lenders (as defined in the Credit Agreement), JPMorgan Chase Bank, N.A., as
syndication agent, Bank of America, N.A., The Bank of New York and Wells Fargo
Bank, National Association, as documentation agents, Citigroup Global Markets
Inc. and J.P. Morgan Securities Inc., as joint lead arrangers, and Citicorp USA, Inc.,
as agent for the Lenders (the “Agent”). 
Terms defined in the Credit Agreement are used herein with the same
meaning.


 


The “Assignor”
and the “Assignee” referred to on Schedule I hereto agree as follows:


 


1.             The Assignor hereby sells and
assigns to the Assignee, and the Assignee hereby purchases and assumes from the
Assignor, an interest in and to the Assignor’s rights and obligations under the
Credit Agreement as of the date hereof (other than in respect of Competitive
Bid Advances and Competitive Bid Notes) equal to the percentage interest
specified on Schedule 1 hereto of all outstanding rights and obligations
under the Credit Agreement (other than in respect of Competitive Bid Advances
and Competitive Bid Notes) together with participations in Letters of Credit
held by the Assignor on the date hereof. 
After giving effect to such sale and assignment, the Assignee’s
Revolving Credit Commitment and the amount of the Revolving Credit Advances owing
to the Assignee will be as set forth on Schedule 1 hereto.


 


2.             The Assignor (i) represents
and warrants that it is the legal and beneficial owner of the interest being
assigned by it hereunder and that such interest is free and clear of any
adverse claim; (ii) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Credit Agreement or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of, or the
perfection or priority of any lien or security interest created or purported to
be created under or in connection with, the Credit Agreement or any other
instrument or document furnished pursuant thereto; (iii) makes no representation
or warranty and assumes no responsibility with respect to the financial
condition of the Borrower or the performance or observance by the Borrower of
any of its obligations under the Credit Agreement or any other instrument or
document furnished pursuant thereto; and (iv) attaches the Revolving
Credit Note[, if any] held by the Assignor [and requests that the Agent
exchange such Revolving Credit Note for a new Revolving Credit Note payable to
the order of [the Assignee in an amount equal to the Revolving Credit
Commitment assumed by the Assignee pursuant hereto or new Revolving Credit
Notes payable to the order of the Assignee in an amount equal to the Revolving
Credit Commitment assumed by the Assignee pursuant hereto and] the Assignor in
an amount equal to the Revolving Credit Commitment retained by the Assignor
under the Credit Agreement, [respectively,] as specified on Schedule 1
hereto.


 


3.             The Assignee (i) confirms that
it has received a copy of the Credit Agreement, together with copies of the
financial statements referred to in Section 4.01 thereof and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assignment and Acceptance; (ii) agrees
that it will, independently and without reliance upon the Agent, the Assignor
or any other Lender and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Credit Agreement; (iii) confirms
that it is an Eligible Assignee; (iv) appoints and authorizes the Agent to
take such action as agent on its behalf and to exercise such powers and
discretion under the Credit Agreement as are delegated to the Agent by the
terms thereof, together with such powers and discretion as are reasonably
incidental thereto; (v) agrees that it will perform in accordance with
their terms all of the obligations that by the terms of the Credit Agreement
are required to be performed by it as a Lender; and (vi) attaches any U.S.
Internal Revenue Service forms required under Section 2.15 of the Credit
Agreement.


 


4.             Following the execution of this
Assignment and Acceptance, it will be delivered to the Agent for acceptance and
recording by the Agent.  The effective
date for this Assignment and Acceptance (the


 





















 


“Effective Date”)
shall be the date of acceptance hereof by the Agent, unless otherwise specified
on Schedule 1 hereto.


 


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


 


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


 


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


 


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


 


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


 


2





















 


Schedule 1


to


Assignment and Acceptance


 


	
  Percentage
  interest assigned:

  	
   

  	
                %

  
	
   

  	
   

  	
   

  
	
  Assignee’s
  Revolving Credit Commitment:

  	
   

  	
  $

  
	
   

  	
   

  	
   

  
	
  Aggregate
  outstanding principal amount of Revolving Credit Advances assigned:

  	
   

  	
  $

  
	
   

  	
   

  	
   

  
	
  Principal amount
  of Revolving Credit Note payable to Assignee:

  	
   

  	
  $

  
	
   

  	
   

  	
   

  
	
  Principal amount
  of Revolving Credit Note payable to Assignor:

  	
   

  	
  $

  
	
   

  	
   

  	
   

  
	
  Effective
  Date*:                         ,
  200  

  	
   

  	
   

  



 


	
   

  	
  [NAME OF
  ASSIGNOR], as Assignor

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Dated:
                      ,
  200  

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  [NAME OF ASSIGNEE],
  as Assignee

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  Dated:
                           ,
  200  

  
	
   

  	
   

  
	
   

  	
  Domestic Lending
  Office:

  	
   

  
	
   

  	
  [Address]

  	
   

  
	
   

  	
   

  
	
   

  	
  Eurodollar
  Lending Office:

  	
   

  
	
   

  	
  [Address]

  	
   

  
					



 










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


 


3





















 


	
  Accepted [and
  Approved]** this

  
	
                        
  day of
                                ,
  200  

  
	
   

  
	
  CITICORP USA,
  INC., as Agent

  
	
   

  
	
  By

  	
   

  	
   

  
	
  Title:

  
	
   

  
	
   

  
	
  [Approved this
                   
  day

  
	
  of
                             ,
  200  

  
	
   

  
	
  THE ST. PAUL
  TRAVELERS COMPANIES, INC.

  
	
   

  
	
  By

  	
   

  	
  ]*

  
	
  Title:

  



 










**                                  Required
if the Assignee is an Eligible Assignee solely by reason of clause (iii) of the
definition of “Eligible Assignee”.


 


*                                         Required
if the Assignee is an Eligible Assignee solely by reason of clause (iii) of the
definition of “Eligible Assignee”.


 


4





















 


EXHIBIT D - FORM OF


OPINION OF COUNSEL


FOR THE BORROWER