Document:

Exhibit 10.1

    EXECUTION
      COPY

    ______________________________________________________________________________

     

    CREDIT
      AGREEMENT

     

    dated
      as
      of 

     

    February
      8, 2006

     

    

     

    among

     

    LINCOLN
      NATIONAL CORPORATION,

    as
      an
      Account Party and Guarantor

     

    The
      SUBSIDIARY ACCOUNT PARTIES,

    as
      additional Account Parties

     

    The
      BANKS
      Party Hereto

     

    and

     

    JPMORGAN
      CHASE BANK, N.A.

    as
      Administrative Agent

     

    ___________________

     

    $1,000,000,000

     

    ___________________

     

    J.P.
      MORGAN SECURITIES INC.

    and

    BANC
      OF
      AMERICA SECURITIES LLC,

    as
      Joint
      Lead Arrangers and Joint Bookrunners

    

    and

    

    BANK
      OF
      AMERICA, N.A.,

    as
      Syndication Agent

    

    ______________________________________________________________________________

     

     

    
      
        
           

           

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
          

           

        

      

    

    
 

    

      TABLE
        OF
        CONTENTS1

      

      
        
          	 	
                  Page

                
	 	 
	
                  ARTICLE
                    I DEFINITIONS

                	
                  1

                
	
                  SECTION
                    1.01. Definitions

                	
                  1

                
	
                  SECTION
                    1.02. Accounting Terms and Determinations

                	
                  13

                
	
                  SECTION
                    1.03. Types of Borrowings

                	
                  14

                
	 	 
	
                  ARTICLE
                    II THE CREDITS

                	
                  14

                
	
                  SECTION
                    2.01. Letters of Credit.

                	
                  14

                
	
                  SECTION
                    2.02. Issuance and Administration of Syndicated Letters of
                    Credit.

                	
                  18

                
	
                  SECTION
                    2.03. Reimbursement for LC Disbursements, Cover, Etc.

                	
                  18

                
	
                  SECTION
                    2.04. Loans

                	
                  22

                
	
                  SECTION
                    2.05. Notice of Borrowings

                	
                  22

                
	
                  SECTION
                    2.06. Funding of Loans

                	
                  23

                
	
                  SECTION
                    2.07. Evidence of Loans

                	
                  24

                
	
                  SECTION
                    2.08. Maturity of Loans

                	
                  24

                
	
                  SECTION
                    2.09. Interest Rates of Loans

                	
                  24

                
	
                  SECTION
                    2.10. Fees.

                	
                  26

                
	
                  SECTION
                    2.11. Termination, Reduction or Increase of Commitments

                	
                  27

                
	
                  SECTION
                    2.12. Optional Prepayments

                	
                  28

                
	
                  SECTION
                    2.13. Payments Generally; Pro Rata Treatment

                	
                  29

                
	
                  SECTION
                    2.14. Funding Losses

                	
                  30

                
	
                  SECTION
                    2.15. Computation of Interest and Fees

                	
                  31

                
	
                  SECTION
                    2.16. Extension of Commitment Termination Date

                	
                  31

                
	
                  SECTION
                    2.17. Replacement of Banks; Fronted Letters of Credit; Obligations
                    of
                    Non-NAIC Approved Banks

                	
                  32

                
	 	 
	
                  ARTICLE
                    III CONDITIONS

                	
                  34

                
	
                  SECTION
                    3.01. Each Credit Extension

                	
                  34

                
	
                  SECTION
                    3.02. Effectiveness

                	
                  35

                
	 	 
	
                  ARTICLE
                    IV REPRESENTATIONS AND WARRANTIES

                	
                  36

                
	
                  SECTION
                    4.01. Corporate Existence and Power

                	
                  36

                
	
                  SECTION
                    4.02. Corporate and Governmental Authorization;
                    Contravention

                	
                  37

                
	
                  SECTION
                    4.03. Binding Effect

                	
                  37

                
	
                  SECTION
                    4.04. Financial Information

                	
                  37

                
	
                  SECTION
                    4.05. Litigation

                	
                  38

                
	
                  SECTION
                    4.06. Compliance with ERISA

                	
                  38

                
	
                  SECTION
                    4.07. Taxes

                	
                  38

                

        

         

          
          _________________

        1
          The Table of Contents is not a part of this agreement. 

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

         

        
          
            	
                    SECTION
                      4.08. Subsidiaries

                  	
                    39

                  
	
                    SECTION
                      4.09. Not an Investment Company

                  	
                    39

                  
	
                    SECTION
                      4.10. Obligations to be Pari Passu

                  	
                    39

                  
	
                    SECTION
                      4.11. No Default

                  	
                    39

                  
	
                    SECTION
                      4.12. Restricted Subsidiaries

                  	
                    39

                  
	
                    SECTION
                      4.13. Environmental Matters

                  	
                    39

                  
	
                    SECTION
                      4.14. Full Disclosure

                  	
                    39

                  
	
                    SECTION
                      4.15. Separate Representations of Subsidiary Account
                      Parties

                  	
                    40

                  
	 	 
	
                    ARTICLE
                      V COVENANTS

                  	
                    41

                  
	
                    SECTION
                      5.01. Information

                  	
                    41

                  
	
                    SECTION
                      5.02. Payment of Obligations

                  	
                    44

                  
	
                    SECTION
                      5.03. Conduct of Business and Maintenance of Existence

                  	
                    44

                  
	
                    SECTION
                      5.04. Maintenance of Property; Insurance

                  	
                    44

                  
	
                    SECTION
                      5.05. Compliance with Laws

                  	
                    45

                  
	
                    SECTION
                      5.06. Inspection of Property, Books and Records

                  	
                    45

                  
	
                    SECTION
                      5.07. Minimum Adjusted Consolidated Net Worth

                  	
                    45

                  
	
                    SECTION
                      5.08. Negative Pledge

                  	
                    46

                  
	
                    SECTION
                      5.09. Consolidations, Mergers and Sales of Assets

                  	
                    46

                  
	
                    SECTION
                      5.10. Use of Credit

                  	
                    46

                  
	
                    SECTION
                      5.11. Obligations to be Pari Passu

                  	
                    46

                  
	
                    SECTION
                      5.12. Termination of Jefferson-Pilot Credit Facility

                  	
                    46

                  
	 	 
	
                    ARTICLE
                      VI DEFAULTS

                  	
                    47

                  
	
                    SECTION
                      6.01. Events of Default

                  	
                    47

                  
	
                    SECTION
                      6.02. Notice of Default

                  	
                    50

                  
	 	 
	
                    ARTICLE
                      VII THE ADMINISTRATIVE AGENT

                  	
                    50

                  
	
                    SECTION
                      7.01. Appointment and Authorization

                  	
                    50

                  
	
                    SECTION
                      7.02. Agent's Fee

                  	
                    51

                  
	
                    SECTION
                      7.03. Agent and Affiliates

                  	
                    51

                  
	
                    SECTION
                      7.04. Action by Agent

                  	
                    51

                  
	
                    SECTION
                      7.05. Consultation with Experts

                  	
                    51

                  
	
                    SECTION
                      7.06. Liability of Agent

                  	
                    51

                  
	
                    SECTION
                      7.07. Indemnification

                  	
                    52

                  
	
                    SECTION
                      7.08. Credit Decision

                  	
                    52

                  
	
                    SECTION
                      7.09. Successor Agent

                  	
                    52

                  
	
                    SECTION
                      7.10. Delegation to Affiliates

                  	
                    53

                  
	
                    SECTION
                      7.11. Joint Lead Arrangers and Other Agents

                  	
                    53

                  
	 	 
	
                    ARTICLE
                      VIII CHANGE IN CIRCUMSTANCES

                  	
                    53

                  
	
                    SECTION
                      8.01. Basis for Determining Interest Rate Inadequate or
                      Unfair

                  	
                    53

                  
	
                    SECTION
                      8.02. Illegality

                  	
                    54

                  
	
                    SECTION
                      8.03. Increased Cost and Reduced Return

                  	
                    54

                  
	
                    SECTION
                      8.04. Base Rate Loans Substituted for Affected Euro-Dollar
                      Loans

                  	
                    56

                  
	
                    SECTION
                      8.05. Taxes

                  	
                    56

                  
	
                    SECTION
                      8.06. Regulation D Compensation

                  	
                    59

                  

          

           

           

           

          
            
              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

           

           

          
            	 	 
	
                    ARTICLE
                      IX GUARANTY

                  	
                    59

                  
	
                    SECTION
                      9.01. The Guaranty

                  	
                    59

                  
	
                    SECTION
                      9.02. Guaranty Unconditional

                  	
                    60

                  
	
                    SECTION
                      9.03. Discharge Only Upon Payment In Full; Reinstatement In
                      Certain
                      Circumstances

                  	
                    61

                  
	
                    SECTION
                      9.04. Waiver by the Company

                  	
                    61

                  
	
                    SECTION
                      9.05. Subrogation

                  	
                    61

                  
	 	 
	
                    ARTICLE
                      X MISCELLANEOUS

                  	
                    61

                  
	
                    SECTION
                      10.01. Notices

                  	
                    61

                  
	
                    SECTION
                      10.02. No Waivers

                  	
                    62

                  
	
                    SECTION
                      10.03. Expenses; Indemnification; Non-Liability of Banks

                  	
                    62

                  
	
                    SECTION
                      10.04. Sharing of Set-Offs

                  	
                    63

                  
	
                    SECTION
                      10.05. Amendments and Waivers

                  	
                    63

                  
	
                    SECTION
                      10.06. Successors and Assigns

                  	
                    64

                  
	
                    SECTION
                      10.07. Collateral

                  	
                    66

                  
	
                    SECTION
                      10.08. New York Law

                  	
                    66

                  
	
                    SECTION
                      10.09. Judicial Proceedings

                  	
                    66

                  
	
                    SECTION
                      10.10. Counterparts; Integration

                  	
                    67

                  
	
                    SECTION
                      10.11. Confidentiality

                  	
                    67

                  
	
                    SECTION
                      10.12. WAIVER OF JURY TRIAL

                  	
                    68

                  
	
                    SECTION
                      10.13. Joinder and Termination of Subsidiary Account Party

                  	
                    68

                  
	
                    SECTION
                      10.14. USA PATRIOT Act

                  	
                    69

                  

          

        

      

       

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      

        
          	
                  Schedule
                    I

                	
                  Commitments

                
	
                  Schedule
                    II

                	
                  List
                    of Restricted Subsidiaries

                
	 	 
	
                  EXHIBIT
                    A

                	
                  Form
                    of Note

                
	
                  EXHIBIT
                    B

                	
                  Opinion
                    of Dennis L. Schoff, Esq., General Counsel of the
                    Company

                
	
                  EXHIBIT
                    C

                	
                  Opinion
                    of Milbank, Tweed, Hadley & McCloy LLP, Special New York Counsel to
                    JPMCB

                
	
                  EXHIBIT
                    D

                	
                  Form
                    of Assignment and Assumption

                
	
                  EXHIBIT
                    E

                	
                  Form
                    of Confirming Bank Agreement

                
	
                  EXHIBIT
                    F

                	
                  Form
                    of Subsidiary Joinder Agreement

                
	
                  EXHIBIT
                    G

                	
                  Subsidiary
                    Termination Notice

                

        

      

      

        
          
            
               

               

            

            
            

          

          
            
            

            
              

            

          

          
            
            

            
              

               

            

          

        

    

    CREDIT
      AGREEMENT dated as of February 8, 2006 among: LINCOLN NATIONAL CORPORATION,
      the
      SUBSIDIARY ACCOUNT PARTIES party hereto, the BANKS party hereto and JPMORGAN
      CHASE BANK, N.A., as Administrative Agent.

     

    The
      Account Parties have requested that the Banks issue letters of credit for their
      account and the Company has requested that the Banks make loans to it in an
      aggregate face or principal amount not exceeding $1,000,000,000 at any one
      time
      outstanding, and the Banks are prepared to issue such letters of credit and
      make
      such loans upon the terms and conditions hereof. Accordingly, the parties hereto
      agree as follows:

     

    ARTICLE
      I

     

    DEFINITIONS

     

    SECTION
      1.01. Definitions

     

    .
      The
      following terms, as used herein, have the following meanings:

     

    "Account
      Party"
      means
      any of the Company and the Subsidiary Account Parties, as the context may
      require, and "Account
      Parties"
      means
      all of the foregoing.

     

    "Additional
      Commitment Bank"
      means
      (a) a Bank or (b) any other Person which is a NAIC Approved Bank, in each case
      that agrees to provide a Commitment or (in the case of a Bank) agrees to
      increase the amount of its Commitment pursuant to Section 2.11(c) or Section
      2.16, with the consent of the Administrative Agent (such consent not to be
      unreasonably withheld).

     

    "Adjusted
      Consolidated Net Worth"
      means,
      at any date, the sum of (a) the consolidated shareholders' equity of the Company
      and its Consolidated Subsidiaries, plus
      (without
      duplication) (b) the aggregate amount of Instruments, to the extent given equity
      credit by S&P and/or Moody's; provided
      that (i)
      in the case such Instruments are given equity credit by both S&P and
      Moody's, the higher of the two amounts shall apply for purposes of clause (b)
      above and (ii) the amount of accumulated other comprehensive income (or loss),
      as shown on the relevant consolidated balance sheet of the Company and its
      Consolidated Subsidiaries most recently filed with the Securities and Exchange
      Commission, shall be excluded from "Adjusted Consolidated Net
      Worth".

     

    "Administrative
      Agent"
      means
      JPMCB, in its capacity as agent for the Banks hereunder, and its successors
      in
      such capacity.

     

    
      
        Credit
          Agreement

        
        

      

      
        
        

        
          

        

      

      
        
        

        -
          2
-

         

      

    

    "Administrative
      Questionnaire"
      means,
      with respect to each Bank, an administrative questionnaire in the form prepared
      by the Administrative Agent and submitted to the Administrative Agent (with
      a
      copy to the Company) duly completed by such Bank.

     

    "Affiliate"
      of any
      Person means any other Person directly or indirectly controlling, controlled
      by
      or under common control with such Person. A Person shall be deemed to control
      another Person if the controlling Person owns 10% or more of any class of voting
      securities (or other ownership interests) of the controlled Person or possesses,
      directly or indirectly, the power to direct or cause the direction of the
      management or policies of the controlled Person, whether through ownership
      of
      stock, by contract or otherwise.

     

    "Agreement"
      means
      this Credit Agreement, as it may be amended or modified and in effect from
      time
      to time.

     

    "Applicable
      Additional Margin"
      means
      0.05% per annum.

     

    "Applicable
      Lending Office"
      means,
      as to each Bank, its office, branch or Affiliate located at its address set
      forth in its Administrative Questionnaire or such other office, branch or
      Affiliate of such Bank as it may hereafter designate as its Applicable Lending
      Office for purposes hereof by notice to the Company and the Administrative
      Agent.

     

    "Applicable
      Facility Fee Rate",
      "Applicable
      Letter of Credit Commission"
      and
      "Applicable
      Margin"
      means,
      for any day, with respect to the facility fees payable hereunder or with respect
      to the letter of credit fees payable under Section 2.10(b) or with respect
      to
      the interest margin on any Euro-Dollar Loan, as the case may be, the applicable
      rate per annum set forth below under the caption "Applicable Facility Fee Rate",
      "Applicable Letter of Credit Commission" or "Applicable Margin", respectively,
      based upon the ratings by Moody's and S&P, respectively, applicable on such
      date to the Index Debt:

    
      
        Credit
          Agreement

        
        

      

      
        
        

        
          

        

      

      
        
        

        -
          3
-

         

      

    

     

     

    
       

      

        
          	 	
                  Index
                    Debt Ratings

                  (S&P/

                  Moody's)

                	
                  Applicable
                    

                  Facility
                    Fee 

                  Rate

                	
                  Applicable
                    

                  Letter
                    of 

                  Credit
                    

                  Commission

                	
                   

                  Applicable
                    

                  Margin

                
	
                  Category
                    1

                	
                  >
                    A+
                    / A1

                	
                  0.04%

                	
                  0.11%

                	
                  0.11%

                
	
                  Category
                    2

                	
                  A
                    /
                    A2

                	
                  0.045%

                	
                  0.125%

                	
                  0.125%

                
	
                  Category
                    3

                	
                  A-
                    / A3

                	
                  0.05%

                	
                  0.15%

                	
                  0.15%

                
	
                  Category
                    4

                	
                  BBB+
                    / Baa1

                	
                  0.06%

                	
                  0.19%

                	
                  0.19%

                
	
                  Category
                    5

                	
                  <
                    BBB / Baa2

                	
                  0.07%

                	
                  0.28%

                	
                  0.28%

                

        

      

      

      For
        purposes of the foregoing, (a) if the ratings established or deemed to have
        been established by Moody's and S&P for the Index Debt shall fall within
        different Categories that are one Category apart, the Applicable Facility
        Fee
        Rate, the Applicable Letter of Credit Commission and the Applicable Margin
        shall
        be determined by reference to the Category of the higher of the two ratings;
        (b) if the ratings established or deemed to have been established by
        Moody's and S&P for the Index Debt shall fall within different Categories
        that are more than one Category apart, the Applicable Facility Fee Rate,
        the
        Applicable Letter of Credit Commission and the Applicable Margin shall be
        determined by reference to the Category next below that of the higher of
        the two
        ratings; (c) if only one of Moody's and S&P shall have in effect a
        rating for the Index Debt, the Applicable Facility Fee Rate, the Applicable
        Letter of Credit Commission and the Applicable Margin shall be determined
        by
        reference to the Category of such rating; (d) if neither Moody's nor
        S&P shall have in effect a rating for the Index Debt (other than by reason
        of the circumstances referred to in the last sentence of this definition),
        then
        the applicable rating shall be determined by reference to Category 5; and
        (e) if the ratings established or deemed to have been established by
        Moody's and S&P for the Index Debt shall be changed (other than as a result
        of a change in the rating system of Moody's or S&P), such change shall be
        effective as of the date on which it is first announced by the applicable
        rating
        agency, irrespective of when notice of such change shall have been furnished
        by
        the Company to the Administrative Agent and the Banks pursuant to Section
        5.01
        or otherwise. Each change in the Applicable Facility Fee Rate, the Applicable
        Letter of Credit Commission and the Applicable Margin shall apply during
        the
        period commencing on the effective date of such change and ending on the
        date

       

       

      
        
          
            Credit
              Agreement

            
            

          

          
            
            

            
              

            

          

          
            
            

            -
              4
-

             

          

        

      

       

       

      immediately
        preceding the effective date of the next such change. If the rating system
        of
        Moody's or S&P shall change, or if either such rating agency shall cease to
        be in the business of rating corporate debt obligations, the Company and
        the
        Banks shall negotiate in good faith to amend this definition to reflect such
        changed rating system or the unavailability of ratings from such rating agency
        and, pending the effectiveness of any such amendment, the Applicable Facility
        Fee Rate, the Applicable Letter of Credit Commission and the Applicable Margin
        shall be determined by reference to the rating of Moody's and/or S&P, as the
        case may be, most recently in effect prior to such change or
        cessation.

    

     

    "Applicable
      Percentage"
      means,
      with respect to any Bank, the percentage of the total Commitments represented
      by
      such Bank's Commitment. If the Commitments have terminated or expired, the
      Applicable Percentages shall be determined based upon the Commitments most
      recently in effect, giving effect to any assignments.

     

    "Assignee"
      has the
      meaning set forth in Section 10.06(c).

     

    "Assignment
      and Assumption"
      means
      an assignment and assumption entered into by a Bank and an assignee (with the
      consent of any party whose consent is required by Section 10.06), and
      accepted by the Administrative Agent, in the form of Exhibit D or any other
      form
      approved by the Administrative Agent.

     

    "Bank"
      means
      each Person listed under the caption "BANKS" on the signature pages hereof,
      and
      each other Person that shall become a party hereto as a Bank pursuant to this
      Agreement (other than any such Person that ceases to be a Bank by means of
      assignment pursuant to this Agreement), together with its successors. For
      purposes of clarification, the term "Bank" shall include each Fronting Issuing
      Bank.

     

    "Bank
      of America"
      means
      Bank of America, N.A.

     

    "Base
      Rate"
      means,
      for any day, a rate per annum equal to the higher of (i) the Prime Rate for
      such
      day and (ii) the sum of 1/2 of 1% plus
      the
      Federal Funds Rate for such day.

     

    "Base
      Rate Loan"
      means a
      Loan to be made by a Bank pursuant to Section 2.04 as a Base Rate Loan in
      accordance with the applicable Notice of Borrowing or Article VIII.

     

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

     

    
      "Borrowing"
        has the
        meaning set forth in Section 1.03.

    

     

    
      
        Credit
          Agreement

        
        

      

      
        
        

        
          

        

      

      
        
        

        -
          5
-

         

      

    

     

    "Code"
      means
      the Internal Revenue Code of 1986, as amended, or any successor
      statute.

     

    "Collateral
      Account"
      has the
      meaning set forth in Section 2.03(e).

     

    "Commitment"
      means,
      with respect to any Bank, the commitment of such Bank (a) to issue Letters
      of
      Credit under Section 2.01(a) and to acquire participations in Fronted Letters
      of
      Credit (if any) and/or (b) to make Loans hereunder, in each case expressed
      as an
      amount representing the maximum aggregate amount of such Bank's Credit Exposure
      hereunder, as such commitment may be (i) reduced or increased from time to
      time pursuant to this Agreement (including pursuant to assignments by or to
      such
      Bank pursuant to Section 10.06). The initial amount of each Bank's
      Commitment is set forth on Schedule I or in the Assignment and Assumption
      or other instrument executed and delivered hereunder pursuant to which such
      Bank
      shall have assumed its Commitment, as applicable. The initial aggregate amount
      of the Banks' Commitments is $1,000,000,000.

     

    "Commitment
      Availability Period"
      means
      the period from and including the Effective Date to but excluding earlier of
      the
      Commitment Termination Date and the date of termination of the
      Commitments.

     

    "Commitment
      Termination Date"
      means
      (a) February 8, 2011 or, if such day is not a Euro-Dollar Business Day, the
      next
      preceding Euro-Dollar Business Day or (b) with respect to any Bank the
      Commitment of which has been extended pursuant to Section 2.16, the date to
      which such Commitment has been so extended.

     

    "Commitment
      Utilization Day"
      means
      (a) any day on which the aggregate principal amount of outstanding Loans equals
      or exceeds 50% of the aggregate amount of the Commitments and (b) any day
      following the termination of the Commitments on which any Loans are outstanding
      hereunder.

     

    "Company"
      means
      Lincoln National Corporation, an Indiana corporation, and its
      successors.

     

    "Company's
      2004 Form 10-K"
      means
      the Company's annual report on Form 10-K for 2004, as filed with the Securities
      and Exchange Commission pursuant to the Securities Exchange Act of 1934, as
      amended.

     

    "Confirming
      Bank"
      means,
      with respect to any Bank, any other bank that has agreed, by delivery of a
      confirming bank agreement in substantially the form of Exhibit E (a
      "Confirming
      Bank Agreement"),
      that
      such other bank will itself honor the obligations of such Bank in respect of
      a
      draft complying with the
      terms
      of a Letter of Credit as if, and to the extent, such other bank were the
      "Issuing Bank" named in such Letter of Credit.

     

    
      
        Credit
          Agreement

        
        

      

      
        
        

        
          

        

      

      
        
        

        -
          6 -

         

      

    

     

    "Confirming
      Bank Agreement"
      has the
      meaning set forth in the definition of "Confirming Bank".

     

    "Consolidated
      Subsidiary"
      means
      at any date any Subsidiary or other entity the accounts of which would be
      consolidated with those of the Company in its consolidated financial statements
      if such statements were prepared as of such date.

     

    "Credit
      Documents"
      means
      (a) this Agreement, (b) the Notes, (c) with respect to any Subsidiary Account
      Party, the Subsidiary Joinder Agreement to which it is a party and (d) with
      respect to any Letter of Credit, collectively, any application therefor and
      any
      other agreements, instruments, guarantees or other documents (whether general
      in
      application or applicable only to such Letter of Credit) governing or providing
      for (i) the rights and obligations of the parties concerned or at risk with
      respect to such Letter of Credit or (ii) any collateral security for any of
      such obligations, each as the same may be modified and supplemented and in
      effect from time to time.

     

    "Credit
      Exposure"
      means,
      with respect to any Bank at any time, the sum of (a) the aggregate principal
      amount of such Bank's Loans and (b) the aggregate amount of such Bank's LC
      Exposure, in each case, outstanding at such time.

     

    "Debt"
      of any
      Person means at any date, without duplication, (a) all obligations of such
      Person for borrowed money, (b) all obligations of such Person evidenced by
      bonds, debentures, notes or other similar instruments, (c) all obligations
      of
      such Person to pay the deferred purchase price of property or services, except
      trade accounts payable arising in the ordinary course of business, (d) all
      obligations of such Person as lessee under capital leases, (e) all
      non-contingent obligations of such Person to reimburse any bank or other Person
      in respect of amounts paid under a letter of credit or similar instrument,
      (f)
      all Debt of others secured by a Lien on any asset of such Person, whether or
      not
      such Debt is assumed by such Person, and (g) all Debt of others Guaranteed
      by
      such Person (it being understood that the definition of "Debt" does not include
      any obligations of such Person (i) to purchase securities (or other property)
      which arise out of or in connection with the sale of the same or substantially
      similar securities (or other property) or (ii) to return collateral consisting
      of securities arising out of or in connection with the loan of the same or
      substantially similar securities).

     

    "Default"
      means
      any condition or event which constitutes an Event of Default or which with
      the
      giving of notice or lapse of time or both would, unless cured or waived, become
      an Event of Default.

     

    "Derivative
      Financial Products"
      of any
      Person means all obligations (including whether pursuant to any master agreement
      or any particular agreement or transaction) of such Person in respect of any
      rate swap transaction, 

     

    
      
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    basis
      swap, forward rate transaction, interest rate future, commodity swap, commodity
      option, equity or equity index swap, equity or equity index option, bond option,
      interest rate option, foreign exchange transaction, cap transaction, floor
      transaction, collar transaction, currency swap transaction, cross-currency
      rate
      swap transaction, currency future, currency option or any other similar
      transaction (including any option with respect to any of the foregoing) or
      any
      combination thereof.

     

    "Dollars"
      and the
      sign "$"
      means
      lawful money in the United States of America.

     

    "Domestic
      Business Day"
      means
      any day except a Saturday, Sunday or other day on which commercial banks in
      New
      York City are authorized by law to close.

     

    "Effective
      Date"
      means
      the date this Agreement becomes effective in accordance with
      Section 3.02.

     

    "Environmental
      Laws"
      means
      any and all federal, state, local and foreign statutes, laws, regulations,
      ordinances, rules, judgments, orders, decrees, permits, concessions, grants,
      franchises, licenses, agreements or other governmental restrictions relating
      to
      the environment or to emissions, discharges or releases of pollutants,
      contaminants, petroleum or petroleum products, chemicals or industrial, toxic
      or
      hazardous substances or wastes into the environment including, without
      limitation, ambient air, surface water, ground water or land, or otherwise
      relating to the manufacture, processing, distribution, use, treatment, storage,
      disposal, transport or handling of pollutants, contaminants, petroleum or
      petroleum products, chemicals or industrial, toxic or hazardous substances
      or
      wastes or the clean-up or other remediation thereof.

     

    "ERISA"
      means
      the Employee Retirement Income Security Act of 1974, as amended, or any
      successor statute.

     

    "ERISA
      Group"
      means
      the Company and all members of a controlled group of corporations and all trades
      or businesses (whether or not incorporated) under common control which, together
      with the Company, are treated as a single employer under Section 414(b) or
      414(c) of the Code.

     

    "Euro-Dollar
      Business Day"
      means
      any Domestic Business Day on which commercial banks are open for international
      business (including dealings in Dollar deposits) in London.

     

    
      "Euro-Dollar
        Loan"
        means a
        Loan to be made by a Bank pursuant to Section 2.04 as a Euro-Dollar Loan
        in
        accordance with the applicable Notice of Borrowing.

       

    

     

    
      
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    "Euro-Dollar
      Reserve Percentage"
      means,
      for any day, that percentage (expressed as a decimal) which is in effect on
      such
      day, as prescribed by the Board of Governors of the Federal Reserve System
      (or
      any successor) for determining the maximum reserve requirement for a member
      bank
      of the Federal Reserve System in New York City with deposits exceeding five
      billion dollars in respect of "Eurocurrency liabilities" (or in respect of
      any
      other category of liabilities which includes deposits by reference to which
      the
      interest rate on Euro-Dollar Loans is determined or any category of extensions
      of credit or other assets which includes loans by a non-United States office
      of
      any Bank to United States residents).

     

    "Event
      of Default"
      has the
      meaning set forth in Section 6.01.

     

    "FASB"
      means
      the Financial Accounting Standards Board or any entity or body succeeding to
      any
      or all of its functions.

     

    "Federal
      Funds Rate"
      means,
      for any day, the rate per annum (rounded upward, if necessary, to the nearest
      1/100th of 1%) equal to the weighted average of the rates on overnight Federal
      funds transactions with members of the Federal Reserve System arranged by
      Federal funds brokers on such day, as published by the Federal Reserve Bank
      of
      New York on the Domestic Business Day next succeeding such day, provided
      that
      (i) if such day is not a Domestic Business Day, the Federal Funds Rate for
      such day shall be such rate on such transactions on the next preceding Domestic
      Business Day as so published on the next succeeding Domestic Business Day,
      and
      (ii) if no such rate is so published on such next succeeding Domestic
      Business Day (as provided in clause (i)), the Federal Funds Rate for such
      day shall be the average rate quoted to the Person serving as Administrative
      Agent on such day on such transactions as determined by the Administrative
      Agent.

     

    "Fronted
      Letter of Credit"
      has the
      meaning set forth in Section 2.17(c).

     

    "Fronting
      Issuing Bank"
      has the
      meaning set forth in Section 2.17(c).

     

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

     

    "Guarantor"
      means
      the Company in its capacity as guarantor of the obligations of each other
      Account Party pursuant to the provisions of Article IX.

     

    "Instruments"
      means
      Securities that are given equity credit by S&P or Moody's (and as to which
      the Company shall have provided evidence of such credit to the Administrative
      Agent), provided
      that the
      term "Instruments" shall exclude any Securities that are recorded in the
      shareholder's equity section of the consolidated balance sheet of the Company
      and its Consolidated Subsidiaries most recently filed with the Securities and
      Exchange Commission.

     

    "Index
      Debt"
      means
      senior, unsecured, long-term indebtedness for borrowed money of the Company
      that
      is not guaranteed by any other Person or subject to any other credit
      enhancement.

     

    "Insurance
      Subsidiary"
      means
      any Restricted Subsidiary which is subject to the regulation of, and is required
      to file statements with, any governmental body, agency or official in any State
      or territory of the United States or the District of Columbia which regulates
      insurance companies or the doing of an insurance business therein.

     

    "Interest
      Period"
      means,
      with respect to each Euro-Dollar Borrowing, the period commencing on the date
      of
      such Borrowing and ending one week or one, two, three or six months thereafter,
      as the Company may elect in the applicable Notice of Borrowing; provided
      that:

     

    (a) any
      Interest Period which would otherwise end on a day which is not a Euro-Dollar
      Business Day shall be extended to the next succeeding Euro-Dollar Business
      Day
      unless such Euro-Dollar Business Day falls in another calendar month, in which
      case such Interest Period shall end on the next preceding Euro-Dollar Business
      Day;

     

    (b) any
      Interest Period which begins on the last Euro-Dollar Business Day of a calendar
      month (or on a day for which there is no numerically corresponding day in the
      calendar month at the end of such Interest Period) shall end on the last
      Euro-Dollar Business Day of a calendar month; and

     

    (c) any
      Interest Period which begins before the Commitment Termination Date and would
      otherwise end after the Commitment Termination Date shall end on the Commitment
      Termination Date (provided
      that, if
      at any time there shall exist different Commitment Termination Dates for the
      Banks hereunder, such Interest Period shall not end after the latest applicable
      Commitment Termination Date).

     

    
      
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    "Investment"
      means
      any investment in any Person, whether by means of share purchase, capital
      contribution, loan, time deposit or otherwise.

     

    "Jefferson-Pilot
      Acquisition"
      means
      the acquisition by the Company or any of its Subsidiaries of Jefferson-Pilot
      Corporation by way of merger of Jefferson-Pilot Corporation with and into a
      wholly-owned Subsidiary of the Company.

     

    "JPMCB"
      means
      JPMorgan Chase Bank, N.A.

     

    "LC
      Disbursement"
      means a
      payment made by a Bank pursuant to a Letter of Credit.

     

    "LC Exposure"
      means,
      at any time, the sum of (a) the aggregate undrawn amount of all outstanding
      Letters of Credit at such time plus
      (b) the aggregate amount of all LC Disbursements under Letters of Credit
      that have not yet been reimbursed by or on behalf of the Account Parties at
      such
      time. The LC Exposure of any Bank shall at any time be its Applicable
      Percentage of the total LC Exposure at such time.

     

    "Letters
      of Credit"
      means
      letters of credit issued under Section 2.01 or Section 2.17.

     

    "LIBO
      Rate"
      has the
      meaning set forth in Section 2.09(b).

     

    "Lien"
      means,
      with respect to any asset, any mortgage, lien, pledge, charge, security interest
      or encumbrance of any kind in respect of such asset. For the purposes of this
      Agreement, the Company or any Subsidiary shall be deemed to own subject to
      a
      Lien any asset which it has acquired or beneficially holds subject to the
      interest of a vendor or lessor under any conditional sale agreement, capital
      lease or other title retention agreement relating to such asset.

     

    "Loan"
      means a
      Base Rate Loan or a Euro-Dollar Loan and "Loans" means Base Rate Loans or
      Euro-Dollar Loans or any combination of the foregoing.

     

    "Material
      Adverse Effect"
      means a
      material adverse effect on (a) business, financial condition, results of
      operations or prospects of the Company and its Consolidated Subsidiaries, taken
      as a whole, (b) the ability of any Account Party to perform any material
      obligations under the Credit Documents or (c) the material rights and remedies
      of the Banks under the Credit Documents.

     

    
      "Material
        Subsidiary"
        means
        any Subsidiary of the Company with assets of $150,000,000 or more.

       

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

    

     

    
      
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    "Multiemployer
      Plan"
      means
      at any time an employee pension benefit plan within the meaning of
      Section 4001(a)(3) of ERISA to which any member of the ERISA Group is then
      making or accruing an obligation to make contributions or has within the
      preceding five plan years made contributions, including for these purposes
      any
      Person which ceased to be a member of the ERISA Group during such five-year
      period.

     

    "NAIC"
      means
      the National Association of Insurance Commissioners and any successor
      thereto.

     

    "NAIC
      Approved Bank"
      means
      (a) any Bank that is a bank listed on the most current "Bank List" of banks
      approved by the NAIC (the "NAIC
      Approved Bank List")
      or
      (b) any Bank as to which its Confirming Bank is a bank listed on the NAIC
      Approved Bank List.

     

    "NAIC
      Approved Bank List"
      has the
      meaning set forth in the definition of "NAIC Approved Bank".

     

    "Newly
      Acquired Subsidiary"
      means
      any Subsidiary that is not a Subsidiary on the date hereof but that becomes
      a
      Subsidiary after the date hereof, but only during the 180 days after the first
      date on which such Subsidiary became a Subsidiary.

     

    "Non-NAIC
      Approved Bank"
      means
      at any time any Bank that is not a NAIC Approved Bank.

     

    "Notes"
      means a
      promissory note or notes of the Company, substantially in the form of Exhibit
      A
      hereto, evidencing the obligation of the Company to repay the Loans made to
      it
      hereunder, and "Note" means any one of such promissory notes issued
      hereunder.

     

    "Notice
      of Borrowing"
      has the
      meaning set forth in Section 2.05.

     

    "Parent"
      means,
      with respect to any Bank, any Person controlling such Bank.

     

    "Participant"
      has the
      meaning set forth in Section 10.06(b).

     

    "Payment
      Account"
      means
      an account designated by the Administrative Agent in a notice to the Account
      Parties and the Banks to which payments hereunder are to be made.

     

    
      "PBGC"
        means
        the Pension Benefit Guaranty Corporation or any entity succeeding to any
        or all
        of its functions under ERISA.

       

    

    
      
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    "Person"
      means
      an individual, a corporation, a partnership, an association, a trust or any
      other entity or organization, including a government or political subdivision
      or
      an agency or instrumentality thereof.

     

    "Plan"
      means
      at any time an employee pension benefit plan (other than a Multiemployer Plan)
      which is covered by Title IV of ERISA or subject to the minimum funding
      standards under Section 412 of the Code and either (i) is maintained, or
      contributed to, by any member of the ERISA Group for employees of any member
      of
      the ERISA Group or (ii) has at any time within the preceding five years been
      maintained, or contributed to, by any Person which was at such time a member
      of
      the ERISA Group for employees of any Person which was at such time a member
      of
      the ERISA Group.

     

    "Prime
      Rate"
      means
      the rate of interest publicly announced from time to time by JPMCB as its prime
      rate as in effect at its principal office in New York City; each change in
      the
      Prime Rate shall be effective from and including the date such change is
      publicly announced as being effective.

     

    "Quarterly
      Dates"
      means
      the last day of March, June, September and December in each year, the first
      of which shall be the first such day after the date hereof.

     

    "Regulations
      T, U and X"
      means
      Regulations T, U and X, respectively, of the Board of Governors of the Federal
      Reserve System, in each case as in effect from time to time.

     

    "Related
      Parties"
      means,
      with respect to any specified Person, such Person's Affiliates and the
      respective directors, officers, employees, agents and advisors of such Person
      and such Person's Affiliates.

     

    "Required
      Banks"
      means
      at any time Banks having Commitments representing more than 50% of the aggregate
      amount of the Commitments at such time; provided
      that, if
      the Commitments have expired or been terminated or if at any time following
      an
      extension of the Commitment Termination Date pursuant to Section 2.16 the
      Commitment of any non-extending Bank or Banks thereunder shall have terminated,
      "Required Banks" means Banks having more than 50% of the aggregate amount of
      the
      Credit Exposures of the Banks at such time.

     

    "Restricted
      Subsidiary"
      means,
      as of any date, a Subsidiary which meets the definitional requirements of a
      "significant subsidiary", as such term is defined in the rules set forth in
      Regulation S-X under the Securities Exchange Act of 1934, as amended (applying
      the tests set forth in such rules with reference to the consolidated balance
      sheets and related consolidated statements of income of the Company and its
      Consolidated Subsidiaries as of the last day of its most recently completed
      fiscal quarter and for the twelve-month period then ended).

     

    
      "S&P"
        means
        Standard and Poor's Ratings Services.

       

    

     

    
      
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    "Secured
      Obligations"
      has the
      meaning set forth in Section 2.03(e).

     

    "Securities"
      means
      any stock, share, partnership interest, membership interest in a limited
      liability company, voting trust certificate, certificate of interest or
      participation in any profit-sharing agreement or arrangement, option, warrant,
      bond, debenture, note, or other evidence of indebtedness, secured or unsecured,
      convertible, subordinated or otherwise, or in general any instruments commonly
      known as "securities" or any certificates of interest, shares or participations
      in temporary or interim certificates for the purchase or acquisition of, or
      any
      right to subscribe to, purchase or acquire, any of the foregoing.

     

    "Subsidiary"
      means
      any corporation or other entity of which securities or other ownership interests
      having ordinary voting power to elect a majority of the board of directors
      or
      other persons performing similar functions are at the time directly or
      indirectly owned by the Company.

     

    "Subsidiary
      Account Parties"
      means
      each Subsidiary of the Company that is listed on the signature pages hereof
      under the caption "SUBSIDIARY ACCOUNT PARTIES" and each other Subsidiary of
      the
      Company that shall become a Subsidiary Account Party pursuant to Section 10.13,
      so long as such Subsidiary shall remain a Subsidiary Account Party
      hereunder.

     

    "Type",
      when
      used in reference to any Loan or Borrowing, refers to whether the Loan is a
      Base
      Rate Loan or a Euro-Dollar Loan.

     

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

     

    SECTION
      1.02. Accounting
      Terms and Determinations

     

    .
      Unless
      otherwise specified herein, all accounting terms used herein shall be
      interpreted, all accounting determinations hereunder shall be made and all
      financial statements required to be delivered hereunder shall be prepared in
      accordance with generally accepted accounting principles as in effect from
      time
      to time, applied on a basis consistent (except for changes concurred in by
      the
      Company's independent public accountants) with the most recent audited
      consolidated financial statements of the Company and its Consolidated
      Subsidiaries delivered to the Banks; provided
      that if
      the Company notifies the Administrative Agent that the Company wishes to amend
      any covenant in Article V to eliminate the effect of any change in generally
      accepted accounting principles on the operation of such covenant (or if

     

    
      
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    the
      Administrative Agent notifies the Company that the Required Banks wish to amend
      Article V for such purpose), then the Company's compliance with such covenant
      shall be determined on the basis of generally accepted accounting principles
      in
      effect immediately before the relevant change in generally accepted accounting
      principles became effective, until either such notice is withdrawn or such
      covenant is amended in a manner satisfactory to the Company and the Required
      Banks.

     

    SECTION
      1.03. Types
      of Borrowings

     

    .
      The
      term "Borrowing" denotes the aggregation of Loans to be made to the Company
      pursuant to Section 2.04 on a single date and for a single Interest Period.
      Borrowings are classified for purposes of this Agreement by reference to the
      pricing of Loans comprising such Borrowing (e.g.,
      a
      "Euro-Dollar Borrowing" is a Borrowing comprised of Euro-Dollar
      Loans).

     

    ARTICLE
      II

     

    THE
      CREDITS

     

    SECTION
      2.01. Letters
      of Credit.

     

    (a) General.
      Subject
      to the terms and conditions set forth herein, at the request of any Account
      Party the Banks agree at any time and from time to time during the Commitment
      Availability Period to issue Letters of Credit denominated in Dollars for the
      account of such Account Party that will not result in the aggregate outstanding
      amount of the Credit Exposures of the Banks exceeding the aggregate amount
      of
      the Commitments of the Banks. 

     

    Each
      Letter of Credit shall be a standby letter of credit in such form as the
      relevant Account Party shall request and which (i) the Administrative Agent
      shall determine in good faith does not contain any obligations, or diminish
      any
      rights, of any Bank with respect thereto that are inconsistent with the terms
      hereof or (ii) the Required Banks shall approve. Except as set forth in
      Section 2.17, without the prior consent of each Bank, no Letter of Credit may
      be
      issued that would vary the several and not joint nature of the obligations
      of
      the Banks thereunder, and each Letter of Credit shall be issued by all of the
      Banks having Commitments at the time of issuance as a single multi-bank letter
      of credit, but the
      obligation of each Bank thereunder shall be several and not joint, based upon
      its Applicable Percentage of the aggregate undrawn amount of such Letter of
      Credit.

     

    (b) Notice
      of Issuance, Amendment, Renewal or Extension.
      To
      request the issuance of a Letter of Credit (or the amendment, renewal or
      extension of an outstanding Letter of Credit), an Account Party shall hand
      deliver or telecopy (or transmit by electronic communication, if arrangements
      for doing so have been approved by the Administrative Agent) to the
      Administrative Agent

     

    
      
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     (if
      by hand delivery or telecopy, not later than noon (New York City time) on the
      Domestic Business Day prior to, and if by approved electronic communication,
      not
      later than 10:00 a.m. (New York City time) on the date of, the requested date
      of
      issuance, amendment, renewal or extension) a notice requesting the issuance
      of a
      Letter of Credit, or identifying the Letter of Credit to be amended, renewed
      or
      extended, and specifying the date of issuance, amendment, renewal or extension,
      as the case may be (which shall be a Domestic Business Day), the date on which
      such Letter of Credit is to expire (which shall comply with
      Section 2.01(d)), the amount of such Letter of Credit, the name and address
      of the beneficiary thereof and the terms and conditions of (and such other
      information as shall be necessary to prepare, amend, renew or extend, as the
      case may be) such Letter of Credit. If requested by the Administrative Agent
      or
      (in the case of any Fronted Letter of Credit) the applicable Fronting Issuing
      Bank through the Administrative Agent, such Account Party also shall submit
      a
      letter of credit application on standard form of the Person that is serving
      as
      Administrative Agent or such Fronting Issuing Bank, as applicable, in connection
      with any request for a Letter of Credit. In the event of any inconsistency
      between the terms and conditions of this Agreement and the terms and conditions
      of any form of letter of credit application or other agreement submitted by
      any
      Account Party to, or entered into by any Account Party with, the Person that
      is
      serving as Administrative Agent or such Fronting Issuing Bank, as applicable,
      relating to any Letter of Credit, the terms and conditions of this Agreement
      shall control.

     

    If
      any
      Letter of Credit shall provide for the automatic extension of the expiry date
      thereof unless the Administrative Agent or (in the case of any Fronted Letter
      of
      Credit) the applicable Fronting Issuing Bank shall give notice to the
      beneficiary thereof that such expiry date shall not be extended (each such
      Letter of Credit, an "Evergreen
      Letter of Credit"
      and
      such notice, a "Non-Extension
      Notice"),
      then
      the Administrative Agent or such Fronting Issuing Bank, as applicable, will
      give
      a Non-Extension Notice under such Evergreen Letter of Credit if requested to
      do
      so by notice given to the Administrative Agent or such Fronting Issuing Bank
      (through the Administrative Agent), not more than 60 days, and not less than
      45
      days, prior to the current expiry date thereof, by (i) the Required Banks,
      (ii) the applicable Account Party or the Company or (iii) (subject to
      the immediately succeeding sentence) any Bank. 

     

    If
      upon or at any time following the Commitment
      Termination Date with respect to any Bank any Evergreen Letter of Credit shall
      be outstanding, such Bank may give notice to the Administrative Agent (with
      a
      copy to the Company) requesting that the Administrative Agent or (in the case
      of
      any Fronted Letter of Credit) the applicable Fronting Issuing Bank give a
      Non-Extension Notice under such Evergreen Letter of Credit at the next earliest
      permitted time in accordance with the terms thereof, whereupon (subject to
      the
      first proviso below) the Administrative Agent or (in the case of any Fronted
      Letter of Credit) the applicable Fronting Issuing Bank agrees to give such
      Non-Extension Notice; provided
      that
      prior to the Administrative Agent (or Fronting 

     

    
      
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    Issuing
      Bank, as applicable) giving such Non-Extension Notice, the Company may elect
      by
      notice to the Administrative Agent (or Fronting Issuing Bank, as applicable)
      that, in lieu of giving such Non-Extension Notice, (i) in respect of Fronted
      Letters of Credit, no such notice be issued (and the immediately succeeding
      sentence shall be applicable thereto) and (ii) in respect of all other Letters
      of Credit, the Administrative Agent shall, at the same time it would have been
      required to give such notice, notify the beneficiary of such Letter of Credit
      in
      accordance with the terms thereof of those Banks whose Commitments have not
      been
      terminated as of such time and such Banks' then respective Applicable
      Percentages under such Letter of Credit, provided
      that
      such election shall not be permitted and no such notification shall be given
      unless, after giving effect thereto, the aggregate outstanding amount of the
      Credit Exposures of such Banks shall not exceed the aggregate amount of the
      Commitments of such Banks. If the Company shall have provided notice under
      clause (i) of the first proviso of the immediately preceding sentence with
      respect to Fronted Letters of Credit, with respect to any outstanding Fronted
      Letter of Credit upon the Commitment Termination Date of any Bank, the
      participation interest of such Bank in each such Fronted Letter of Credit shall
      automatically terminate on the first anniversary of such Commitment Termination
      Date, and the participation interests of those Banks whose Commitments have
      not
      been terminated shall automatically be adjusted to reflect, and each such Bank
      shall have a participation in each such Fronted Letter of Credit equal to,
      such
      Bank’s Applicable Percentage of the aggregate amount available to be drawn under
      such Fronted Letter of Credit on such first anniversary.

     

    (c) Limitations
      on Amounts and Daily Transactions.
      Each
      Letter of Credit shall be issued, amended, renewed or extended if and only
      if
      (and upon such issuance, amendment, renewal or extension of each Letter of
      Credit the Account Parties shall be deemed to represent and warrant that),
      after
      giving effect to such issuance, amendment, renewal or extension, the aggregate
      outstanding amount of the Credit Exposures of the Banks shall not exceed the
      aggregate amount of the Commitments of the Banks.

     

    In
      no
      event may more than 25 issuances, amendments, renewals and/or extensions of
      Letters of Credit occur on any day, unless the Administrative Agent shall
      otherwise agree.

     

    
      (d) Expiry
        Date.
        Each
        Letter of Credit shall expire at or prior to the close of business on the
        earlier of (i) the date one year after the date of the issuance of such Letter
        of Credit (provided
        that
        such Letter of Credit may contain "evergreen" provisions for the renewal
        or
        extension thereof to a date one year after the then current expiry date thereof)
        or (ii) the first anniversary of the Commitment Termination Date (or, if
        at any
        time there shall exist different Commitment Termination Dates for the Banks
        hereunder, the first anniversary of the latest applicable Commitment Termination
        Date).

    

    
      
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    (e) Obligation
      of Banks.
      With
      respect to any Letter of Credit (other than Fronted Letters of Credit), the
      obligation of any Bank under such Letter of Credit shall be several and not
      joint and shall at any time be in an amount equal to such Bank's Applicable
      Percentage of the aggregate undrawn amount of such Letter of Credit, and each
      such Letter of Credit shall expressly so provide.

     

    By
      the
      issuance of a Fronted Letter of Credit (or an amendment to a Fronted Letter
      of
      Credit increasing the amount thereof) by any Fronting Issuing Bank, and without
      any further action on the part of any Fronting Issuing Bank or the Banks, the
      applicable Fronting Issuing Bank hereby grants to each Bank, and each Bank
      hereby acquires from such Fronting Issuing Bank, a participation in such Fronted
      Letter of Credit equal to such Bank's Applicable Percentage of the aggregate
      amount available to be drawn under such Fronted Letter of Credit. Each Bank
      acknowledges and agrees that its obligation to acquire participations in respect
      of Fronted Letters of Credit is absolute and unconditional and shall not be
      affected by any circumstance whatsoever, including any amendment, renewal or
      extension of any Fronted Letter of Credit or the occurrence and continuance
      of a
      Default or reduction or termination of the Commitments. In consideration and
      in
      furtherance of the foregoing, each Bank hereby absolutely and unconditionally
      agrees to pay to the Administrative Agent, for account of the applicable
      Fronting Issuing Bank, such Bank's Applicable Percentage of each LC Disbursement
      made by such Fronting Issuing Bank in respect of any Fronted Letter of Credit
      promptly upon the request of such Fronting Issuing Bank at any time from the
      time such LC Disbursement is made until such LC Disbursement is reimbursed
      by
      the applicable Account Party or at any time after any reimbursement payment
      is
      required to be refunded to such Account Party for any reason. Such payment
      shall
      be made without any offset, abatement, withholding or reduction whatsoever.
      Promptly following receipt by the Administrative Agent of any payment from
      the
      applicable Account Party pursuant to Section 2.03(a) in respect of any Fronted
      Letter of Credit, the Administrative Agent shall distribute such payment to
      the
      applicable Fronting Issuing Bank or, to the extent that the Banks have made
      payments pursuant to this paragraph to reimburse such Fronting Issuing Bank,
      then to the Banks and such Fronting Issuing Bank as their interests may appear.
      Any payment made by a Bank pursuant to this paragraph to reimburse the
      applicable Fronting Issuing Bank for any LC Disbursement shall not
      relieve any Account Party of its obligation to reimburse such
      LC Disbursement.

     

    (f) Adjustment
      of Applicable Percentages.
      Upon
      (i) each addition of a new Bank hereunder and (ii) each increase in or any
      assignment of the Commitment of a Bank pursuant to this Agreement, then (A)
      the
      Administrative Agent shall promptly notify each beneficiary under each
      outstanding Letter of Credit (other than a Fronted Letter of Credit) of the
      Banks that are parties to such Letter of Credit, after giving effect to such
      event, and such Banks' respective Applicable Percentages as of the relevant
      effective date thereof 

     

     

    
      
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    and
      (B)
      (in the case of each outstanding Fronted Letter of Credit) the participation
      interest of each Bank therein shall automatically be adjusted to reflect, and
      each Bank shall have a participation in such Fronted Letter of Credit equal
      to,
      such Bank's Applicable Percentage of the aggregate amount available to be drawn
      under such Fronted Letter of Credit after giving effect to such
      event.

     

    SECTION
      2.02. Issuance
      and Administration of Syndicated Letters of Credit.
      With
      respect to any Letter of Credit (other than Fronted Letters of Credit), each
      such Letter of Credit shall be executed and delivered by the Administrative
      Agent in the name and on behalf of, and as attorney-in-fact for, the Banks
      party
      to such Letter of Credit, and the Administrative Agent shall act under each
      such
      Letter of Credit, and each such Letter of Credit shall expressly provide that
      the Administrative Agent shall act as the agent of each such Bank to
      (a) receive drafts, other demands for payment and other documents presented
      by the beneficiary under such Letter of Credit, (b) determine whether such
      drafts, demands and documents are in compliance with the terms and conditions
      of
      such Letter of Credit and (c) to notify such Bank, the Company and the
      applicable Account Party that a valid drawing has been made and the date that
      the related LC Disbursement is to be made; provided
      that the
      Administrative Agent shall have no obligation or liability for any LC
      Disbursement under such Letter of Credit, and each such Letter of Credit shall
      expressly so provide. Each Bank hereby irrevocably appoints and designates
      the
      Administrative Agent as its attorney-in-fact, acting through any duly authorized
      officer of the Person that is serving as the Administrative Agent, to execute
      and deliver in the name and on behalf of such Bank each such Letter of Credit
      to
      be issued by the Banks hereunder. Promptly upon the request of the
      Administrative Agent, each Bank will furnish to the Administrative Agent such
      powers of attorney or other evidence as any beneficiary of any such Letter
      of
      Credit may reasonably request in order to demonstrate that the Administrative
      Agent has the power to act as attorney-in-fact for such Bank to execute and
      deliver such Letter of Credit. 

     

    
      SECTION
        2.03. Reimbursement for LC Disbursements, Cover, Etc.

       

      (a) Reimbursement.
        If any
        Bank shall make any LC Disbursement in respect of any Letter of Credit, the
        Account Party with respect to such Letter of Credit shall reimburse such
        Bank in
        respect of any such LC Disbursement by paying to the Administrative Agent
        an
        amount equal to such LC Disbursement not later than noon, New York City time,
        on
        (A) the Domestic Business Day that the Company and such Account Party
        receive notice of such LC Disbursement, if such notice is received prior
        to
        10:00 a.m., New York City time, or (B) the Domestic Business Day
        immediately following the day that the Company and such Account Party receive
        such notice, if such notice is received on a day which is not a Domestic
        Business Day or is not received prior to 10:00 a.m., New York City time,
        on a
        Domestic Business Day.

    

     

    
      
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    (b) Reimbursement
      Obligations Absolute.
      The
      Account Parties' obligations to reimburse LC Disbursements as provided in
      Section 2.03(a) shall be absolute, unconditional and irrevocable, and shall
      be performed strictly in accordance with the terms of this Agreement under
      any
      and all circumstances whatsoever and irrespective of (i) any lack of
      validity or enforceability of any Letter of Credit, or any term or provision
      therein, (ii) any draft or other document presented under a Letter of
      Credit proving to be forged, fraudulent or invalid in any respect or any
      statement therein being untrue or inaccurate in any respect, (iii) payment
      under a Letter of Credit against presentation of a draft or other document
      that
      does not comply strictly with the terms of such Letter of Credit, (iv) at any
      time or from time to time, without notice to any Account Party, the time for
      any
      performance of or compliance with any of such reimbursement obligations of
      any
      other Account Party shall be waived, extended or renewed, (v) any of such
      reimbursement obligations of any other Account Party shall be amended or
      otherwise modified in any respect, or the Guarantee of any of such reimbursement
      obligations or any security therefor shall be released, substituted or exchanged
      in whole or in part or otherwise dealt with, (vi) any lien or security interest
      granted to, or in favor of, the Administrative Agent or any of the Banks as
      security for any of such reimbursement obligations shall fail to be perfected,
      (vii) the occurrence of any Default, (viii) the existence of any
      proceedings of the type described in Section 6.01(g) or (h) with respect to
      any other Account Party or the Guarantor of any of such reimbursement
      obligations, (ix) any lack of validity or enforceability of any of such
      reimbursement obligations against any other Account Party or the Guarantor
      of
      any of such reimbursement obligations, or (x) any other event or
      circumstance whatsoever, whether or not similar to any of the foregoing, that
      might, but for the provisions of this Section 2.03, constitute a legal or
      equitable discharge of the obligations of any Account Party
      hereunder.

     

    Neither
      the Administrative Agent nor any Bank nor any of their Related Parties shall
      have any liability or responsibility by reason of or in connection
      with the issuance or transfer of any Letter of Credit or any payment or failure
      to make any payment thereunder (irrespective of any of the circumstances
      referred to in the preceding sentence), or any error, omission, interruption,
      loss or delay in transmission or delivery of any draft, notice or other
      communication under or relating to any Letter of Credit (including any document
      required to make a drawing thereunder), any error in interpretation of technical
      terms or any consequence arising from causes beyond their control; provided
      that the
      foregoing shall not be construed to excuse the Administrative Agent or a Bank
      from liability to any Account Party to the extent of any direct damages (as
      opposed to consequential damages, claims in respect of which are hereby waived
      by the Account Parties to the extent permitted by applicable law) suffered
      by
      any Account Party that are caused by (x) the gross negligence or willful
      misconduct of the Administrative Agent or such Bank, as the case may be, or
      (y)
      in the case of any Bank, its failure to make an LC Disbursement in respect
      of
      any drawing properly made under a Letter of Credit as provided in Section
      2.03(c). The parties hereto expressly agree that:

     

    
      
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    (i)
      the
      Administrative Agent or (in the case of any Fronted Letter of Credit) the
      applicable Fronting Issuing Bank may accept documents that appear on their
      face
      to be in substantial compliance with the terms of a Letter of Credit without
      responsibility for further investigation, regardless of any notice or
      information to the contrary, and may make payment upon presentation of documents
      that appear on their face to be in substantial compliance with the terms of
      such
      Letter of Credit;

     

    (ii)
      the
      Administrative Agent or (in the case of any Fronted Letter of Credit) the
      applicable Fronting Issuing Bank shall have the right, in its sole discretion,
      to decline to accept such documents and to make such payment if such documents
      are not in strict compliance with the terms of such Letter of Credit;
      and

     

    (iii)
      this sentence shall establish the standard of care to be exercised by the
      Administrative Agent or (in the case of any Fronted Letter of Credit) the
      applicable Fronting Issuing Bank when determining whether drafts and other
      documents presented under a Letter of Credit comply with the terms thereof
      (and
      the parties hereto hereby waive, to the extent permitted by applicable law,
      any
      standard of care inconsistent with the foregoing).

     

    (c) Disbursement
      Procedures.
      (i) The
      following provisions shall apply to any Letter of Credit (other than any Fronted
      Letter of Credit). The Administrative Agent shall, within a reasonable time
      following its receipt thereof, examine all documents purporting to represent
      a
      demand for payment under any such Letter of Credit. The Administrative Agent
      shall promptly after such examination (A) notify each of the Banks, the
      Company and the Account Party by telephone (confirmed by telecopy) of such
      demand for payment and (B) deliver to each Bank a copy of each document
      purporting to represent a demand for payment under such Letter of Credit. With
      respect to any drawing properly made under any such Letter of Credit, each
      Bank
      will make an LC Disbursement in respect of such Letter of Credit in accordance
      with its liability under such Letter of Credit and this Agreement, such LC
      Disbursement to be made to the account of the Administrative Agent most recently
      designated by it for such purpose by notice to the Banks. The Administrative
      Agent will make any such LC Disbursement available to the beneficiary of such
      Letter of Credit by promptly crediting the amounts so received, in like funds,
      to the account identified by such beneficiary in connection with such demand
      for
      payment. Promptly following any LC Disbursement by any Bank in respect of any
      such Letter of Credit, the Administrative Agent will notify the Company and
      the
      applicable Account Party of such LC Disbursement; provided
      that any
      failure to give or delay in giving such notice shall not relieve such Account
      Party of its obligation to reimburse the Banks with respect to any such LC
      Disbursement or the Guarantor of its guarantee of such
      obligation.

     

    
      
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    (ii)
      The
      following provisions shall apply to any Fronted Letter of Credit. The applicable
      Fronting Issuing Bank shall, within a reasonable time following its receipt
      thereof, examine all documents purporting to represent a demand for payment
      under a Fronted Letter of Credit. The applicable Fronting Issuing Bank shall
      promptly after such examination notify the Administrative Agent and the Company
      by telephone (confirmed by telecopy) of such demand for payment and whether
      such
      Fronting Issuing Bank has made or will make a LC Disbursement thereunder;
provided
      that any
      failure to give or delay in giving such notice shall not relieve the applicable
      Account Party of its obligation to reimburse such Fronting Issuing Bank and
      the
      Banks with respect to any such LC Disbursement.

     

    (d) Interim
      Interest.
      If any
      LC Disbursement is made, then, unless the Account Parties shall reimburse such
      LC Disbursement in full on the date such LC Disbursement is made (without regard
      for when notice thereof is given), the unpaid amount thereof shall bear
      interest, for each day from and including the date such LC Disbursement is
      made
      to but excluding the date that the applicable Account Party reimburses such
      LC
      Disbursement, at the rate per annum equal to (i) 1% plus
      the Base
      Rate to but excluding the date three Domestic Business Days after such LC
      Disbursement and (ii) from and including the date three Domestic Business Days
      after such LC Disbursement, 3% plus
      the Base
      Rate.

     

    (e) Provision
      of Cover.
      In the
      event the Company and the Account Parties shall have provided cover for
      outstanding Letters of Credit pursuant to Section 6.01, the Administrative
      Agent
      will establish a separate cash collateral account (the "Collateral
      Account"),
      which
      may be a "securities account" (as defined in Section 8-501 of the Uniform
      Commercial Code as in effect in New York (the "NY
      UCC")),
      in
      the name and under the sole dominion and control of the Administrative Agent
      (and, in the case of a securities account, in respect of which the
      Administrative Agent is the "entitlement holder" (as defined in
      Section 8-102(a)(7) of the NY UCC)) into which there shall be deposited
      from time to time such amounts paid to the Administrative Agent as cover for
      the
      applicable LC Exposure. As collateral security for the prompt payment in full
      when due of all reimbursement obligations in respect of LC Disbursements, all
      interest thereon, and all other obligations of the Account Parties under the
      Credit Documents whether or not then outstanding or due and payable (such
      obligations being herein collectively called the "Secured
      Obligations"),
      each
      of the Company and the other Account Parties hereby pledges and grants to the
      Administrative Agent, for the benefit of the Banks and the Administrative Agent
      as provided herein, a security interest in all of its right, title and interest
      in and to the Collateral Account and the balances from time to time in the
      Collateral Account (including the investments and reinvestments therein provided
      for below). The balances from time to time in the Collateral Account shall
      not constitute payment of any Secured Obligations until applied by the
      Administrative Agent as provided herein. Anything in this Agreement to the
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    the
      Collateral Account shall be subject to withdrawal only as provided in this
      Section 2.03(e). Amounts on deposit in the Collateral Account shall be
      invested and reinvested by the Administrative Agent in such short-term
      Investments as the Administrative Agent shall determine in its sole discretion.
      All such investments and reinvestments shall be held in the name and be under
      the sole dominion control of the Administrative Agent and shall be credited
      to
      the Collateral Account. At any time, and from time to time, while an Event
      of
      Default has occurred and is continuing, the Administrative Agent shall, if
      instructed by the Required Banks in their sole discretion, liquidate any such
      investments and reinvestments and credit the proceeds thereof to the Collateral
      Account and apply or cause to be applied such proceeds and any other balances
      in
      the Collateral Account to the payment of any of the Secured Obligations due
      and
      payable. If at any time (i) no Default has occurred and is continuing and (ii)
      all of the Secured Obligations then due have been paid in full but Letters
      of
      Credit remain outstanding, the Administrative Agent shall, from time to time,
      at
      the request of the Company, deliver to the Company, against receipt but without
      any recourse, warranty or representation whatsoever, such of the balances in
      the
      Collateral Account as exceed the aggregate undrawn face amount of all
      outstanding Letters of Credit. When all of the Secured Obligations shall have
      been paid in full, all Letters of Credit have expired or been terminated and
      the
      Commitments have terminated, the Administrative Agent shall promptly deliver
      to
      the Company, for account of the Company and the other Account Parties, as
      applicable, against receipt but without any recourse, warranty or representation
      whatsoever, the balances remaining in the Collateral Account.

     

    SECTION
      2.04. Loans

     

    .
      At any
      time and from time to time during the Commitment Availability Period each Bank
      severally agrees, on the terms and conditions set forth in this Agreement,
      to make loans in Dollars to the Company pursuant to this Section in amounts
      such
      that the aggregate outstanding amount of the Credit Exposures of the Banks
      shall
      not exceed the aggregate amount of the Commitments of the Banks. Each Borrowing
      shall be in an aggregate principal amount of $25,000,000 or any larger multiple
      of $1,000,000 and shall be made from the several Banks ratably in proportion
      to
      their respective Commitments. Within the foregoing limits, the Company may
      borrow under this Section, repay, or to the extent permitted by Section 2.12,
      prepay Loans and reborrow at any time during the Commitment Availability Period
      under this Section.
       

      SECTION
        2.05. Notice
        of Borrowings

       

      .
        The
        Company shall give the Administrative Agent notice (a "Notice
        of Borrowing")
        not
        later than 11:00 a.m. (New York City time) on (x) the date of each Base Rate
        Borrowing and (y) the third Euro-Dollar Business Day before each Euro-Dollar
        Borrowing, specifying:

       

      (a) the
        date
        of such Borrowing, which shall be a Domestic Business Day in the case of
        a Base
        Rate Borrowing or a Euro-Dollar Business Day in the case of a Euro-Dollar
        Borrowing,

    

     

    
      
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    (b) the
      aggregate amount (in Dollars) of such Borrowing,

     

    (c) whether
      the Loans comprising such Borrowing are to be Base Rate Loans or Euro-Dollar
      Loans, and

     

    (d) in
      the
      case of a Euro-Dollar Borrowing, the duration of the Interest Period applicable
      thereto, subject to the provisions of the definition of Interest
      Period.

     

    SECTION
      2.06. Funding
      of Loans.
      (a)
      Upon receipt of a Notice of Borrowing, the Administrative Agent shall promptly
      notify each Bank of the contents thereof and of such Bank's share of such
      Borrowing and such Notice of Borrowing shall not thereafter be revocable by
      the
      Company.

     

    (b) Not
      later
      than 12:00 noon (New York City time) (or 1:00 p.m. (New York City time) in
      the
      case of any Base Rate Borrowing) on the date of each Borrowing, each Bank
      participating therein shall (except as provided in subsection (c) of this
      Section) make available its share of such Borrowing, in Federal or other funds
      immediately available in New York City, to the Administrative Agent at its
      address specified in or pursuant to Section 10.01. Unless the Administrative
      Agent determines that any applicable condition specified in Article III has
      not
      been satisfied, the Administrative Agent will make the funds so received from
      the Banks available to the Company at the Administrative Agent's aforesaid
      address.

     

    
      (c) If
        any
        Bank makes a new Loan hereunder on a day on which the Company is to repay
        all or
        any part of an outstanding Loan from such Bank, such Bank shall apply the
        proceeds of its new Loan to make such repayment and only an amount equal
        to the
        difference (if any) between the amount being borrowed and the amount being
        repaid shall be made available by such Bank to the Administrative Agent as
        provided in subsection (b) of this Section, or remitted by the Company to
        the
        Administrative Agent as provided in Section 2.13, as the case may
        be.

       

      (d) Unless
        the Administrative Agent shall have received notice from a Bank prior to
        the
        date of any Borrowing that such Bank will not make available to the
        Administrative Agent such Bank's share of such Borrowing, the Administrative
        Agent may assume that such Bank has made such share available to the
        Administrative Agent on the date of such Borrowing in accordance with
        subsections (b) and (c) of this Section and the Administrative Agent may,
        in
        reliance upon such assumption, make available to the Company on such date
        a
        corresponding amount. If and to the extent that such Bank shall not have
        so made
        such share available to the Administrative Agent, such Bank and the Company
        severally agree to repay to the Administrative Agent forthwith on demand
        such
        corresponding amount together with interest thereon, for each day from the
        date
        such amount is made available to the Company until the date such amount is
        

    

    
      
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    repaid
      to
      the Administrative Agent, at (i) in the case of the Company, a rate per annum
      equal to the higher of the Federal Funds Rate and the interest rate applicable
      thereto pursuant to Section 2.09 and (ii) in the case of such Bank, the Federal
      Funds Rate. If such Bank shall repay to the Administrative Agent such
      corresponding amount, such amount so repaid shall constitute such Bank's Loan
      included in such Borrowing for purposes of this Agreement.

     

    SECTION
      2.07. Evidence
      of Loans.
      (a)
      Each Bank shall maintain in accordance with its usual practice records
      evidencing the indebtedness of the Company to such Bank resulting from each
      Loan
      made by such Bank, including the amounts of principal and interest payable
      and
      paid to such Bank from time to time hereunder, and setting forth the Commitments
      of the Banks.

     

    (b)
      The
      Administrative Agent shall maintain records in which it shall record
      (i) the amount of each Loan made hereunder and each Interest Period
      therefor, (ii) the amount of any principal or interest due and payable or
      to become due and payable from the Company to each Bank hereunder and
      (iii) the amount of any sum received by the Administrative Agent hereunder
      for account of the Banks and each Bank's share thereof.

     

    (c)
      The
      entries made in the records maintained pursuant to subsection (a)
      or (b) of this Section shall be prima facie
      evidence
      of the existence and amounts of the obligations recorded therein; provided
      that the
      failure of any Bank
      or
      the Administrative Agent to maintain such records or any error therein shall
      not
      in any manner affect the obligation of the Company to repay the Loans in
      accordance with the terms of this Agreement.

    
       

      (d)
        Any
        Bank may request that the Loans of such Bank to the Company be evidenced
        by a
        single Note, in substantially the form of Exhibit A hereto with appropriate
        modifications to reflect the fact that it evidences solely Loans of the relevant
        Type, payable by the Company to the order of such Bank for the account of
        its
        Applicable Lending Office. In such event, the Company shall prepare, execute
        and
        deliver to such Bank a Note payable to such Bank (or, if requested by such
        Bank,
        to such Bank and its registered assigns). Thereafter, the Loans evidenced
        by
        such Note and interest thereon shall at all times (including after assignment
        pursuant to Section 10.06) be represented by one or more Notes in such form
        payable to the payee named therein (or, if such Note is a registered note,
        to
        such payee and its registered assigns).

       

      SECTION
        2.08. Maturity
        of Loans.
        Each
        Loan shall mature, and the Company hereby unconditionally promises to pay
        the
        unpaid principal of each Loan (together with accrued interest thereon), on
        the
        Commitment Termination Date.

       

      SECTION
        2.09. Interest
        Rates of Loans.
        (a)
        Each Base Rate Loan shall bear interest on the outstanding principal amount
        thereof, for each day 

    

     

    
      

      
        
          
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from
        the date such Loan is made until it becomes
        due, at a rate per annum equal to the sum of the Base Rate for such day plus,
        for any
        Commitment Utilization Day, the Applicable Additional Margin. Such interest
        shall accrue and be payable quarterly in arrears on each Quarterly Date and
        on
        the date of termination of the Commitments in their entirety (and, if later,
        the
        date the Loans shall be paid in full). Any overdue principal of or interest
        on
        any Base Rate Loan shall bear interest, payable on demand, for each day until
        paid at a rate per annum equal to the sum of 2% plus
        the Base
        Rate for such day plus,
        for any
        Commitment Utilization Day, the Applicable Additional
        Margin.

    

     

    (b) Each
      Euro-Dollar Loan shall bear interest on the outstanding principal amount
      thereof, for the Interest Period applicable thereto, at a rate per annum equal
      to the sum of the Applicable Margin plus
      the
      applicable LIBO Rate plus,
      for any
      Commitment Utilization Day, the Applicable Additional Margin. Such interest
      shall be payable for each Interest Period on the last day thereof and, if such
      Interest Period is longer than three months, at intervals of three months after
      the first day thereof.

     

    The
      "LIBO
      Rate"
      applicable to any Interest Period means the rate appearing on Page 3750 of
      the
      Telerate Service (or any successor or substitute page of such Service, or any
      successor to or substitute for such Service, providing rate quotations
      comparable to those currently provided on such page of such Service,
      as determined by the Administrative Agent for purposes of providing quotations
      of interest rates applicable to U.S. Dollar deposits in the London interbank
      market) at approximately 11:00 A.M. (London time) two Euro-Dollar Business
      Days
      before the first day of such Interest Period, as the rate for the offering
      of
      Dollar deposits with a maturity comparable to such Interest Period. In the
      event
      that such rate is not available at such time for any reason, then the LIBO
      Rate
      for such Interest Period shall be the rate at which U.S. Dollar deposits of
      $10,000,000 and for a maturity comparable to such Interest Period are offered
      by
      the principal London office of the Person serving as Administrative Agent in
      immediately available funds in the London interbank market at approximately
      11:00 A.M. (London time), two Euro-Dollar Business Days before the first day
      of
      such Interest Period.

    
       

      (c) Any
        overdue principal of any Euro-Dollar Loan shall bear interest, payable on
        demand, for each day from and including the date payment thereof was due
        to but
        excluding the date of actual payment, at a rate per annum equal to the sum
        of 2%
plus
        the
        Applicable Margin plus,
        for any
        Commitment Utilization Day, the Applicable Additional Margin plus
        the
        average (rounded upward, if necessary, to the next higher 1/16 of 1%) of
        the
        respective rates per annum (as of the date of determination) at which one-day
        (or, if such amount due remains unpaid more than three Euro-Dollar Business
        Days, then for such other period of time not longer than six months as the
        Administrative Agent may select) deposits in Dollars in an amount approximately
        equal to such overdue payment due to the Person serving as the Administrative
        Agent are offered to such Person 

    

     

    
      
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    in
      the
      London interbank market for the applicable period determined as provided above
      (or, if the circumstances described in clause (a) or (b) of Section 8.01 shall
      exist, at a rate per annum equal to the sum of 2% plus
      the Base
      Rate for such day plus,
      for any
      Commitment Utilization Day, the Applicable Additional Margin). Any overdue
      interest on any Euro-Dollar Loan shall bear interest, payable on demand, for
      each day from and including the date payment thereof is due to but excluding
      the
      date of actual payment, at a rate per annum equal to the sum of 2% plus
      the Base
      Rate for such day plus,
      for any
      Commitment Utilization Day, the Applicable Additional Margin.

     

    (d) The
      Administrative Agent shall determine each interest rate applicable to the Loans
      hereunder. The Administrative Agent shall give prompt notice to the Company
      and
      the Banks of each rate of interest so determined, and its determination thereof
      shall be conclusive in the absence of manifest error.

     

    SECTION
      2.10. Fees.

     

    (a) The
      Company agrees to pay to the Administrative Agent for account of each Bank
      a
      facility fee, which shall accrue at the Applicable Facility Fee Rate, (i) prior
      to the termination of such Bank's Commitment, on the daily
      amount of the Commitment of such Bank (whether used or unused) during the period
      from and including the Effective Date to but excluding the date that the
      Commitments terminate and (ii) if such Bank continues to have any Credit
      Exposure after its Commitment terminates, on the daily amount of such Bank's
      Credit Exposure from and including the date its Commitment terminates to but
      excluding the date such Bank ceases to have any Credit Exposure. Accrued
      facility fees shall be payable on each Quarterly Date and on the earlier of
      the
      date the Commitments terminate and the Commitment Termination Date, commencing
      on the first such date after the Effective Date; provided
      that any
      facility fee accruing after such earlier date shall be payable on demand.
      Facility fees shall be computed on the basis of a year of 360 days and shall
      be
      payable for the actual number of days elapsed (including the first day but
      excluding the last day).
       

      (b) The
        Company agrees to pay to the Administrative Agent for account of each Bank
        a
        letter of credit fee with respect to Letters of Credit, which shall accrue
        at
        the Applicable Letter of Credit Commission on the average daily aggregate
        undrawn amount of all outstanding Letters of Credit during the period from
        and
        including the Effective Date to but excluding the later of the date on which
        such Bank's Commitment terminates and the date on which such Bank ceases
        to have
        any LC Exposure. Letter of credit fees accrued through and including each
        Quarterly Date shall be payable on the third Business Day following such
        Quarterly Date, commencing on the first such Business Day to occur; provided
        that all
        such fees shall be payable on the date on which the Commitments terminate
        and
        any such fees accruing after the date on which the Commitments terminate
        shall
        be payable on demand. Letter of credit fees shall be

    

    
      
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     computed
      on the basis of a year of 360 days and
      shall be payable for the actual number of days elapsed (including the first
      day
      but excluding the last day).

     

    (c) Except
      as
      set forth in Section 2.17, the Account Parties agree to pay, on demand, to
      the
      Administrative Agent for its own account all commissions, charges, costs and
      expenses with respect to the issuance, amendment, renewal and extension of
      each
      Letter of Credit and drawings and other transactions relating thereto in amounts
      customarily charged from time to time in like circumstances by the Person that
      is serving as the Administrative Agent or, as may be separately agreed from
      time
      to time by the Company on behalf of the Account Parties and the Administrative
      Agent for its own account.

     

    (d) All
      fees
      payable hereunder shall be paid on the dates due, in immediately available
      funds, to the Administrative Agent for distribution, in the case of facility
      fees and letter of credit fees, to the Banks entitled thereto. Fees paid
      hereunder shall not be refundable under any circumstances.

     

    
      SECTION
        2.11. Termination, Reduction or Increase of Commitments.

       

      (a) Unless
        previously terminated, the Commitments shall automatically terminate on the
        Commitment Termination Date. Notwithstanding anything herein to the contrary,
        if
        the Jefferson-Pilot Acquisition shall not have been consummated on or prior
        to
        September 29, 2006, (i) unless previously terminated, the Commitments shall
        automatically terminate on such date and (ii) principal of the Loans then
        outstanding (together with accrued interest thereon) shall become due and
        payable on such date.

       

      (b) The
        Company may, upon at least three Domestic Business Days' notice to the
        Administrative Agent, terminate at any time, or proportionately and permanently
        reduce from time to time by an aggregate amount of $10,000,000 or any larger
        multiple of $5,000,000, the aggregate amount of the Commitments, provided
        that,
        after giving effect to such termination or any such reduction, the aggregate
        outstanding amount of the Credit Exposures of the Banks shall not exceed
        the
        aggregate amount of the Commitments of the Banks. Upon receipt of such a
        notice,
        the Administrative Agent shall promptly notify each Bank of the contents
        thereof
        and of such Bank's ratable share of such reduction (if such notice is a notice
        of reduction) and such notice shall not thereafter be revocable by the Company.
        Any termination or reduction of the Commitments shall be permanent.

       

      (c) The
        Company shall have the right, at any time or from time to time prior to the
        date
        that is 30 days prior to the Commitment Termination Date, to increase the
        aggregate Commitments hereunder up to an aggregate amount not exceeding
        $1,500,000,000, by causing one or more Additional Commitment Banks (which
        may
        include any existing Bank) to provide a (or, in

    

     

    
      
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     the
      case of an existing Bank, to increase its) Commitment (each such increase,
      an
      "Commitment
      Increase"),
      provided
      that
      (i) no Bank shall have any obligation hereunder to become an Additional
      Commitment Bank and any election to do so shall be in the sole discretion of
      each Bank, (ii) each Additional Commitment Bank shall have entered into an
      agreement in form and substance satisfactory to the Company and the
      Administrative Agent pursuant to which such Additional Commitment Bank shall
      provide a Commitment (or, if such Additional Commitment Bank is an existing
      Bank, pursuant to which its Commitment shall be increased), (iii) such
      Commitment of any Additional Commitment Bank which is not an existing Bank
      shall
      be in an amount of at least $25,000,000 and (iv) each Commitment Increase
      shall be in an amount of at least $25,000,000. Each such Additional Commitment
      Bank shall enter into an agreement in form and substance satisfactory to the
      Company and the Administrative Agent pursuant to which such Additional
      Commitment Bank shall, as of effective date of such Commitment Increase (which
      shall be a Domestic Business Day and, unless the Administrative
      Agent otherwise agrees, on which no issuance, amendment, renewal or extension
      of
      any Letter of Credit is scheduled to occur, provide a Commitment (or, if any
      such Additional Commitment Bank is an existing Bank, increase its Commitment
      in
      the amount specified therein and (if not an existing Bank) become a Bank
      hereunder. Notwithstanding the foregoing, no Commitment Increase pursuant to
      this Section shall be effective unless:
       

      (i)
        the
        Company shall have given the Administrative Agent notice of any such increase
        at
        least three Domestic Business Days prior to the relevant effective date of
        such
        Commitment Increase;

       

      (ii)
        no
        Default shall have occurred and be continuing on such effective date;
        and

       

      (iii)
        each of the representations and warranties of each Account Party contained
        in
        this Agreement (other than the representations and warranties set forth in
        Sections 4.04(e) and 4.05 as to any matter which has theretofore been disclosed
        in writing by the Account Parties to the Banks) shall be true on and as of
        such
        effective date with the same force and effect as if made on and as of such
        date
        (or, if any such representation or warranty is expressly stated to have been
        made as of a specific date, as of such specific date).

       

      Each
        notice under clause (i) above shall be deemed to constitute a representation
        and
        warranty by the Company and the Subsidiary Account Parties as to the matters
        specified in clauses (ii) and (iii) above. 

       

      SECTION
        2.12. Optional
        Prepayments.
        (a) The
        Company may, upon at least one Domestic Business Day's notice to the
        Administrative Agent, prepay any Base Rate Borrowing in whole at any time,
        or
        from time to time in part in amounts aggregating $5,000,000 or any larger
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    paying
      the principal amount to be prepaid together
      with accrued interest thereon to the date of prepayment.

     

    (b) The
      Company may, upon notice to the Administrative Agent by 10:00 a.m., New York
      City time, at least three Domestic Business Days prior to the date of
      prepayment, prepay any Euro-Dollar Borrowing in whole at any time, or from
      time
      to time in part in amounts aggregating $5,000,000 or any larger multiple of
      $1,000,000, by paying the principal amount to be prepaid together with
      (x) accrued interest thereon to the date of prepayment and (y) all losses
      and expenses (if any) relating thereto which are (i) determined pursuant to
      Section 2.14 and (ii) notified to the Company by the relevant Bank at least
      one
      Domestic Business Day prior to the date of such prepayment, provided
      that the
      failure of any Bank to so notify the Company of the amount of any such loss
      or
      expense shall not relieve the Company of its obligation to pay the
      same.

    (c) Each
      prepayment pursuant to this Section shall be applied to prepay ratably the
      Loans
      of the several Banks included in the relevant Borrowing being prepaid. Upon
      receipt of a notice of prepayment pursuant to this Section, the Administrative
      Agent shall promptly notify each Bank of the contents thereof and of such Bank's
      ratable share (if any) of such prepayment and such notice shall not thereafter
      be revocable by the Company.

     

    SECTION
      2.13. Payments
      Generally; Pro Rata Treatment.

     

    (a) Each
      Account Party shall make each payment required to be made by it hereunder
      (whether reimbursement of LC Disbursements, principal of or interest on the
      Loans, fees, amounts under Article VIII or otherwise) or under any other Credit
      Document (except to the extent otherwise provided therein) prior to not later
      than 2:00 p.m., New York City time, on the date when due, in immediately
      available funds, without set-off or counterclaim. Any amounts received after
      such time on any date may, in the discretion of the Administrative Agent, be
      deemed to have been received on the next succeeding Domestic Business Day for
      purposes of calculating interest thereon. All such payments shall be made to
      the
      Administrative Agent at its Payment Account, except as otherwise expressly
      provided in the relevant Credit Document, and except that payments pursuant
      to
      Section 10.03 and Article VIII shall be made directly to the Persons entitled
      thereto. The Administrative Agent shall distribute any such payments received
      by
      it for account of any other Person to the appropriate recipient promptly
      following receipt thereof. If any payment hereunder shall be due on a day that
      is not a Domestic Business Day or Euro-Dollar Business Day (as applicable),
      the
      date for payment shall be extended to the next succeeding Domestic or
      Euro-Dollar Business Day (as applicable) and, in the case of any payment
      accruing interest, interest thereon shall be payable for the period of such
      extension. All payments hereunder or under any other Credit Document shall
      be
      made in Dollars.

     

    

      
        
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    (b) If
      at any
      time insufficient funds are received by and available to the Administrative
      Agent to pay fully all amounts of unreimbursed LC Disbursements in respect
      of
      Letters of Credit (other than Fronted Letters of Credit) or interest thereon,
      principal of or interest on the Loans and fees then due hereunder, such funds
      shall be applied (i) first, to pay interest and fees then due hereunder in
      respect of such Letters of Credit or Loans (as applicable), pro rata among
      the
      Banks in accordance with the amounts of interest and fees then due to the Banks,
      and (ii) second, to pay such unreimbursed LC Disbursements or principal in
      respect of Loans (as applicable) then due hereunder, pro rata among the Banks
      in
      accordance with the amounts of unreimbursed LC Disbursements or principal of
      Loans then due to the Banks.

    (c) Except
      to
      the extent otherwise provided herein: (i) each reimbursement of LC
      Disbursements in respect of Letters of Credit (other than Fronted Letters of
      Credit) and each payment of facility fee under Section 2.10(a) shall be for
      account of the Banks, and each termination or reduction of the amount of the
      Commitments under Section 2.04 shall be applied to the respective
      Commitments of the Banks, pro rata in accordance with their respective
      Applicable Percentages; (ii) each payment of principal of Loans and each of
      interest hereunder shall be for account of the Banks, pro rata in accordance
      with the amounts of principal or interest (as the case may be) then due and
      payable to the Banks; and (iii) each payment of letter of credit fee under
      Section 2.10(b) shall be for account of the Banks, pro rata in accordance
      with their respective Applicable Percentages under the Letters of
      Credit.

     

    (d) Unless
      the Administrative Agent shall have received notice from the Company or the
      applicable Account Party prior to the date on which any payment is due to the
      Administrative Agent for account of the Banks hereunder that neither the Company
      nor such Account Party will make such payment, the Administrative Agent may
      assume that the Company or such Account Party made such payment on such date
      in
      accordance herewith and may, in reliance upon such assumption, distribute to
      the
      Banks the amount due. In such event, if the Company or such Account Party has
      not in fact made such payment, then each of the Banks severally agrees to repay
      to the Administrative Agent forthwith on demand the amount so distributed to
      such Bank with interest thereon, for each day from and including the date such
      amount is distributed to it to but excluding the date of payment to the
      Administrative Agent, at the Federal Funds Rate.

     

    SECTION
      2.14. Funding
      Losses.
      If the
      Company makes any payment of principal with respect to any Euro-Dollar Loan
      (pursuant to Article VI or VIII or otherwise) on any day other than the last
      day
      of the Interest Period applicable thereto, or the end of an applicable period
      fixed pursuant to Section 2.09(b), or if the Company fails to borrow any
      Euro-Dollar Loans after notice has been given to any Bank in accordance with
      Section 2.04(a), the Company shall reimburse each Bank within 15 days after
      demand for any resulting loss or expense incurred by it (or by an existing
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    Loan),
      including (without limitation) any loss incurred in obtaining, liquidating
      or
      employing deposits from third parties, but excluding loss of margin for the
      period after any such payment or failure to borrow, provided
      that
      such Bank shall have delivered to the Company a certificate as to the amount
      of
      such loss or expense, which certificate shall be conclusive in the absence
      of
      manifest error.
       

      SECTION
        2.15. Computation
        of Interest and Fees.
        Interest based on the Prime Rate shall be computed on the basis of a year
        of 365
        days (or 366 days in a leap year) and paid for the actual number of days
        elapsed
(including the first day but excluding the last day). All other interest
        and fees shall be computed on the basis of a year of 360 days and paid for
        the
        actual number of days elapsed (including the first day but excluding the
        last
        day).

    

     

    SECTION
      2.16. Extension
      of Commitment Termination Date.
      (a)
Request
      for Extension.
      The
      Company may, by notice to the Administrative Agent (which shall promptly notify
      the Banks) not more than 60 days and not less than 30 days prior to each
      anniversary of the Effective Date (such anniversary date, the "Extension
      Effective Date"),
      request (each, an "Extension
      Request")
      that
      the Banks extend the Commitment Termination Date then in effect (the
      "Existing
      Commitment Termination Date")
      for an
      additional one year, provided
      that no
      more than two Extension Requests may be made hereunder. Each Bank, acting in
      its
      sole discretion, shall, by notice to the Company and the Administrative Agent
      given not later than the 20th
      day (or
      such later day as shall be acceptable to the Company) following the date of
      such
      Company's notice, advise the Company and the Administrative Agent whether or
      not
      such Bank agrees to such extension; provided
      that any
      Bank that does not so advise the Company shall be deemed to have rejected such
      Extension Request. The election of any Bank to agree to such extension shall
      not
      obligate any other Bank to so agree.

     

    (b) Replacement
      of Non-extending Banks.
      The
      Company shall have the right at any time on or prior to the relevant Extension
      Effective Date, unless an Event of Default shall have occurred and be
      continuing, to replace any non-extending Bank with, and otherwise add to this
      Agreement, one or more Additional Commitment Banks. Each Additional Commitment
      Bank shall enter into an agreement in form and substance reasonably satisfactory
      to the Company and the Administrative Agent pursuant to which such Additional
      Commitment Bank shall, effective as of the Extension Effective Date, provide
      a
      Commitment or (if such Additional Commitment Bank is an existing Bank) increase
      its Commitment in the amount specified therein and (if not an existing Bank)
      become a Bank hereunder, so long as any amounts payable to the relevant
      non-extending Bank being replaced are paid in full.

     

    (c) Effectiveness
      of Extension.
      If (and
      only if) the total of the Commitments of the Banks that have agreed in
      connection with any Extension Request to extend the Existing Commitment
      Termination Date and the additional Commitments of the Additional Commitment
      Bank(s) shall be at least 50% of the 

    
 

    
      
        
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    aggregate
      amount of the Commitments in effect immediately prior to the Extension Effective
      Date, then, effective as of the Extension Effective Date, the Commitment
      Termination Date, with respect to the Commitment of each Bank that has agreed
      to
      so extend its Commitment and of each Additional Commitment Bank shall be
      extended to the date falling one year after the then Existing Commitment
      Termination Date (or, if such date is not a Euro-Dollar Business Day, such
      Commitment Termination Date as so extended shall be the next preceding
      Euro-Dollar Business Day) and each Additional Commitment Bank shall thereupon
      become a "Bank" for all purposes of this Agreement.

     

    Notwithstanding
      the foregoing, the extension of the Existing Termination Date shall not be
      effective with respect to any Bank unless as of the relevant Extension Date
      (i)
      no Default shall have occurred and be continuing and (ii) the representations
      and warranties of each Account Party contained in this Agreement and the other
      Credit Documents shall be true on and as of such date with the same force and
      effect as if made on and as of such date (or, if any such representation and
      warranty is expressly stated to have been made as of a specific date, as of
      such
      specific date) (and the Administrative Agent shall have received a certification
      to such effect from a senior financial Officer of the Company, together with
      such evidence and other related documents as the Administrative Agent may
      reasonably request with respect to the authorization of the Company and other
      Account Parties of the extension and their respective obligations
      hereunder).

     

    Notwithstanding
      anything herein to the contrary, with respect to any Bank that has not approved
      any Extension Request, the Commitment Termination Date for such Bank shall
      remain unchanged (and the Commitment of such Bank shall terminate, and the
      Loans
      made by such Bank shall be repayable, on such date and the obligations of such
      Bank in respect of Letters of Credit shall not extend beyond the first
      anniversary of such date).

     

    SECTION
      2.17. Replacement
      of Banks; Fronted Letters of Credit; Obligations of Non-NAIC Approved
      Banks.
      (a)
Replacement
      of Defaulting Bank .
      If any
      Bank defaults in its obligation to fund any LC Disbursement hereunder, the
      Company may, upon notice to such Bank and the Administrative Agent, require
      such
      Bank, at the expense of such Bank, to assign, without recourse (in accordance
      with and subject to the restrictions contained in Section 10.06), all its
      interests, rights and obligations under this Agreement and the Letters of Credit
      issued, or participated in, by such Bank to any Person that shall assume such
      obligations (which assignee may be another Bank, if it accepts such assignment)
      with (and subject to) the consent of the Administrative Agent (which consent
      shall not unreasonably be withheld); provided
      that
      such Bank shall have received payment of an amount equal to the outstanding
      amount of its LC Disbursements, accrued interest thereon, accrued fees and
      all
      other amounts payable to it hereunder, from the assignee (to the extent of
      such
      outstanding LC Disbursements and accrued interest and fees) or the applicable
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    the
      case
      of all other amounts). No Bank shall be required to make any assignment pursuant
      to this Section 2.17(a) if, prior thereto, the circumstances entitling the
      Company to require such assignment cease to apply.

     

    (b)
      Replacement
      of Non-NAIC Approved Bank.
      If at
      any time any Bank shall be a Non-NAIC Approved Bank, such Bank shall promptly
      notify the Company and the Administrative Agent and shall use commercially
      reasonable efforts (i) to be listed on the NAIC Approved Bank List or (ii)
      to
      agree with a Person which is listed on the NAIC Approved Bank List (with (and
      subject to) the consent of the Company and the Administrative Agent (which
      consent, in each case, shall not unreasonably withheld)) to act as a Confirming
      Bank for such Bank in respect of its obligations under the Letters of Credit
      and, in such case, such Bank shall enter into a Confirming Bank Agreement with
      such Person (and furnish a copy thereof to the Company and the Administrative
      Agent).

     

    Notwithstanding
      anything herein to the contrary, at any time any Bank shall be a Non-NAIC
      Approved Bank, the Company may, upon notice to such Bank and the Administrative
      Agent, require such Bank, at the expense of such Bank, to assign, without
      recourse (in accordance with and subject to the restrictions contained in
      Section 10.06), all its interests, rights and obligations under this
      Agreement and the Letters of Credit issued, or participated in, by such Bank
      to
      any Person that shall assume such obligations (which assignee may be another
      Bank, if it accepts such assignment) with (and subject to) the consent of the
      Administrative Agent (which consent shall not unreasonably be withheld),
provided
      that
      such Bank shall have received payment of an amount equal to the outstanding
      amount of its LC Disbursements, accrued interest thereon, accrued fees and
      all
      other amounts payable to it hereunder, from the assignee (to the extent of
      such
      outstanding LC Disbursements and accrued interest and fees) or the applicable
      Account Parties (in the case of all other amounts). No Bank shall be required
      to
      make any assignment pursuant to this Section 2.17(b) if, prior thereto, the
      circumstances entitling the Company to require such assignment cease to
      apply.

     

    (c)
      Issuance
      of Fronted Letters of Credit; Obligations of Non-NAIC Approved
      Bank.
      At any
      time any Bank shall be a Non-NAIC Approved Bank, notwithstanding anything herein
      to the contrary, the Company may request by notice to the Administrative Agent
      that JPMCB and/or (if at the time of such request JPMCB is not a NAIC Approved
      Bank or if the aggregate amount of the requested letters of credit would exceed
      the limitation set forth in clause (i) of the proviso below) Bank of America
      and/or (if at the time of such request neither JPMCB nor Bank of America is
      a
      NAIC Approved Bank or if the aggregate amount of the requested letters of credit
      would exceed the limitation set forth in clause (i) of the proviso below) any
      other Bank that has agreed to act as an issuing bank under this Section (such
      issuer being hereinafter referred to as "Fronting
      Issuing Bank")
      issue
      one or more letters of credit of the type described herein under Section 2.01(a)
      (each a "Fronted
      Letter of Credit"),
      and
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    Issuing
      Bank agrees to issue such letters of credit promptly upon such request, subject
      to the terms and conditions set forth herein; provided
      that (i)
      neither JPMCB nor Bank of America shall be required to issue Fronted Letters
      of
      Credit hereunder in an aggregate face amount exceeding, in each case,
      $500,000,000 and (ii) no other Bank shall have any obligation hereunder
      to become a Fronting Issuing Bank and any election to do so shall be in the
      sole
      discretion of such other Bank. Each Fronted Letter of Credit shall be issued
      by,
      and be the sole obligation as issuing bank of, the applicable Fronting Issuing
      Bank

     

    If
      at any
      time as a result of any Bank being a Non-NAIC Bank the Company shall exercise
      its rights under this Section 2.17(c) to require the issuance of one or more
      Fronted Letters of Credit by any Fronting Issuing Bank, such Bank agrees (A)
      to
      pay to the applicable Fronting Issuing Bank for its own account a fronting
      fee
      in respect of each Fronted Letter of Credit issued by such Fronting Issuing
      Bank
      which shall accrue at a rate per annum of 0.125% on the average daily amount
      of
      the aggregate undrawn amount of each such Fronted Letter of Credit during the
      period from and including the date of issuance thereof to but excluding the
      later of the expiry date thereof and the date on which there ceases to be any
      LC Exposure thereunder. Fronting fees in respect of each such Fronted
      Letter of Credit accrued through and including each Quarterly Date shall be
      payable on the third Business Day following such Quarterly Date, commencing
      on
      the first such date to occur after the issuance of such Fronted Letter of
      Credit; provided
      that all
      such fees shall be payable on the date on which the Commitments terminate and
      any such fees accruing after the date on which the Commitments terminate shall
      be payable on demand, (B) to pay to the applicable Fronting Issuing Bank for
      its
      own account, within 10 Business Days after demand, such Fronting Issuing Bank's
      standard administrative fees with respect to the issuance, amendment, renewal
      or
      extension of any such Fronted Letter of Credit or processing of drawings
      thereunder and (C) to reimburse to the Company, within 10 Business Days after
      demand, any amounts paid by the Company to any Fronting Issuing Bank in respect
      of any Fronted Letter of Credit pursuant to Section 8.03.

     

    ARTICLE
      III

     

    CONDITIONS

     

    SECTION
      3.01. Each
      Credit Extension.
      The
      obligation of each Bank to issue, amend, renew or extend any Letter of Credit
      or
      to make any Loan is subject to the satisfaction of the following
      conditions:

     

    (a) in
      the
      case of a Letter of Credit, receipt by the Administrative Agent of a notice
      of
      issuance, amendment, renewal or extension, as the case may be, with respect
      to
      such Letter Credit, as 

     

    
      
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    required
      by Section 2.01(b) or, in the case of a Borrowing, receipt by the
      Administrative Agent of a Notice of Borrowing as required by Section
      2.05;

     

    (b) the
      fact
      that, immediately before and after issuance, amendment, renewal or extension
      of
      such Letter Credit or such Loan no Default shall have occurred and be
      continuing; and

     

    (c) the
      fact
      that the representations and warranties of each Account Party contained in
      this
      Agreement (other than the representations and warranties set forth in Sections
      4.04(e) and 4.05 as to any matter which has theretofore been disclosed in
      writing by the Account Parties to the Banks) shall be true on and as of the
      date
      of such issuance, amendment, renewal or extension of such Letter Credit or
      such
      Loan (or, if any such representation or warranty is expressly stated to have
      been made as of a specific date, as of such specific date), provided
      that the
      exception in the first parenthetical phrase in this clause shall not apply
      in
      the case of any issuance, amendment, renewal or extension of a Letter of Credit
      or the making of a Loan on the Effective Date or with respect to the certificate
      under clause (d) of Section 3.02.

     

    Each
      issuance, amendment, renewal or extension of a Letter Credit and the making
      of
      any Loan hereunder shall be deemed to be a representation and warranty by the
      applicable Account Party on the date of such issuance, amendment, renewal or
      extension or Loan, as the case may be, as to the facts specified in clauses
      (b)
      and (c) of this Section.

     

    SECTION
      3.02. Effectiveness.
      This
      Agreement shall become effective on the first date that all of the following
      conditions shall have been satisfied (or waived in accordance with
      Section 10.05):

     

    (a) receipt
      by the Administrative Agent of counterparts hereof signed by each of the Persons
      listed on the signature pages hereto (or, in the case of any Bank as to which
      an
      executed counterpart shall not have been received, receipt by the Administrative
      Agent in form satisfactory to it of telegraphic, telex or other written
      confirmation from such Bank of execution and delivery of a counterpart hereof
      by
      such Bank);

     

    (b) receipt
      by the Administrative Agent of an opinion of Dennis L. Schoff, Esq., General
      Counsel of the Company, substantially in the form of Exhibit B
      hereto;

     

    (c) receipt
      by the Administrative Agent of an opinion of Milbank, Tweed, Hadley & McCloy
      LLP, special New York counsel to JPMCB, substantially in the form of Exhibit
      C
      hereto;

     

    
      
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    (d) receipt
      by the Administrative Agent of a certificate, dated the Effective Date and
      signed by a senior financial officer of the Company, certifying as to clauses
      (b) and (c) of Section 3.01;

     

    (e) receipt
      by the Administrative Agent of a copy of the resolutions of the Board of
      Directors of the Company, in form and substance satisfactory to the
      Administrative Agent, authorizing the execution, delivery and performance of
      this Agreement and other Credit Documents;

     

    (f) receipt
      by the Administrative Agent of all documents, opinions and instruments as it
      may
      reasonably request relating to the existence of each Account Party, the
      corporate authority for and the validity and enforceability of this Agreement
      and the other Credit Documents, and any other matters related hereto, all in
      form and substance satisfactory to the Administrative Agent; and

     

    (g) receipt
      by the Administrative Agent of evidence as to payment of all fees required
      to be
      paid, and all expenses required to be paid or reimbursed for which invoices
      have
      been presented (including, without limitation, fees and disbursements of counsel
      to JPMCB) in connection with this Agreement, on or before the Effective
      Date;

     

    provided
      that
      this Agreement shall not become effective or be binding on any party hereto
      unless all of the foregoing conditions are satisfied not later than 3:00 p.m.
      (New York City time) February 28, 2006 or such later date as may be agreed
      in
      writing by the Company and all of the Banks. The Administrative Agent shall
      promptly notify the Company and the Banks of the Effective Date, and such notice
      shall be conclusive and binding on all parties hereto.

     

    ARTICLE
      IV

     

    REPRESENTATIONS
      AND WARRANTIES

     

    Each
      of
      the Company (other than with respect to Section 4.15) and the Subsidiary
      Account Parties (with respect to Section 4.15 only) represents and warrants
      that:

     

    SECTION
      4.01. Corporate
      Existence and Power.
      The
      Company is a corporation duly incorporated and validly existing under the laws
      of the State of Indiana, and has all corporate power and all material
      governmental licenses, authorizations, consents and approvals required to carry
      on its business as now conducted.

     

    
      
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    SECTION
      4.02. Corporate and Governmental Authorization; Contravention.
      The
      execution, delivery and performance by the Company of this Agreement and the
      other Credit Documents to which it is a party are within the Company's corporate
      powers, have been duly authorized by all necessary corporate action, require
      no
      action by or in respect of, or filing with, any governmental body, agency or
      official and do not contravene, or constitute a default under, any provision
      of
      applicable law or regulation or of the articles of incorporation or by-laws
      of
      the Company or of any material agreement, judgment, injunction, order, decree
      or
      other instrument binding upon the Company or any of its Restricted Subsidiaries
      or result in the creation or imposition of any Lien on any asset of the Company
      or any of its Restricted Subsidiaries.

     

    SECTION
      4.03. Binding
      Effect.
      This
      Agreement and the other Credit Documents to which it is a party constitute
      the
      legal, valid and binding obligations of the Company, in each case enforceable
      in
      accordance with their respective terms, except as the same may be limited by
      bankruptcy, insolvency or similar laws affecting creditors' rights generally
      and
      by general principles of equity.

     

    SECTION
      4.04. Financial
      Information.

     

    (a) The
      consolidated balance sheets of the Company and its Consolidated Subsidiaries
      as
      of December 31, 2004 and the related consolidated statements of income, cash
      flows and shareholders' equity for the fiscal year then ended, reported on
      by
      Ernst & Young LLP and set forth in the Company's 2004 Form 10-K, a copy of
      which has been delivered to the Administrative Agent on behalf of each of the
      Banks, fairly present, in conformity with generally accepted accounting
      principles, the consolidated financial position of the Company and its
      Consolidated Subsidiaries as of such date and their consolidated results of
      operations and changes in financial position for such fiscal year.

     

    (b) The
      unaudited consolidated balance sheets of the Company and its Consolidated
      Subsidiaries as of September 30, 2005 and the related unaudited consolidated
      statements of income, cash flows and shareholders' equity for the nine months
      then ended, set forth in the Company's quarterly report for the fiscal quarter
      ended September 30, 2005 as filed with the Securities and Exchange Commission
      on
      Form l0-Q, a copy of which has been delivered to the Administrative Agent on
      behalf of each of the Banks, fairly present, in conformity with generally
      accepted accounting principles applied on a basis consistent with the financial
      statements referred to in subsection (a) of this Section, the consolidated
      financial position of the Company and its Consolidated Subsidiaries as of such
      date and their consolidated results of operations and changes in financial
      position for such nine month period (subject to normal year-end
      adjustments).

     

    
      
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    (c) A
      copy of
      a duly completed and signed Annual Statement or other similar report of or
      for
      each Insurance Subsidiary in the form filed with the governmental body, agency
      or official which regulates insurance companies in the jurisdiction in which
      such Insurance Subsidiary is domiciled for the year ended December 31, 2004
      has
      been delivered to the Administrative Agent on behalf of each of the Banks and
      fairly presents, in accordance with statutory accounting principles, the
      information contained therein.

     

    (d) A
      copy of
      a duly completed and signed Quarterly Statement or other similar report of
      or
      for each Insurance Subsidiary in the form filed with the governmental body,
      agency or official which regulates insurance companies in the jurisdiction
      in
      which such Insurance Subsidiary is domiciled for the quarter ended September
      30,
      2005 has been delivered to the Administrative Agent on behalf of each of the
      Banks and fairly presents, in accordance with statutory accounting principles,
      the information contained therein.

     

    (e) Since
      December 31, 2004 and as of the Effective Date, there has been no material
      adverse change in the business, financial condition, results of operations
      or
      prospects of the Company and its Consolidated Subsidiaries, considered as a
      whole.

     

    SECTION
      4.05. Litigation.
      As of
      the Effective Date, there is no action, suit or proceeding pending against,
      or
      to the knowledge of the Company threatened against, the Company or any of its
      Subsidiaries before any court or arbitrator or any governmental body, agency
      or
      official (a) which has or would be reasonably expected to have a Material
      Adverse Effect, or (b) which in any manner draws into question the validity
      or enforceability of this Agreement or any other Credit Document.

     

    SECTION
      4.06. Compliance
      with ERISA.
      Except
      as would not result in a Material Adverse Effect, each member of the ERISA
      Group
      has fulfilled its obligations under the minimum funding standards of ERISA
      and
      the Code with respect to each Plan and is in compliance in all material respects
      with the presently applicable provisions of ERISA and the Code with respect
      to
      each Plan. Except as would not result in a Material Adverse Effect, no member
      of
      the ERISA Group has (i) sought a waiver of the minimum funding standard under
      Section 412 of the Code in respect of any Plan, (ii) failed to make any
      contribution or payment to any Plan or Multiemployer Plan or in respect of
      any
      Benefit Arrangement, or made any amendment to any Plan or Benefit Arrangement,
      which has resulted or could result in the imposition of a Lien or the posting
      of
      a bond or other security under ERISA
      or
      the Code or (iii) incurred any liability under Title IV of ERISA other than
      a
      liability to the PBGC for premiums under Section 4007 of
      ERISA.

     

    SECTION
      4.07. Taxes.
      United
      States Federal income tax returns of the Company and its Subsidiaries have
      been
      examined and closed through the 

     

    
      
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    fiscal
      year ended December 31, 1995. The Company and its Subsidiaries have filed all
      income tax returns and all other material tax returns which are required to
      be
      filed by them and have paid all taxes due pursuant to such returns or, except
      for any such taxes that are being contested in good faith by appropriate
      proceedings and for which adequate reserves have been made, pursuant to any
      assessment received by the Company or any Subsidiary. The charges, accruals
      and
      reserves on the books of the Company and its Subsidiaries in respect of taxes
      are, in the opinion of the Company, adequate.

     

    SECTION
      4.08. Subsidiaries.
      Each of
      the Company's Restricted Subsidiaries is a corporation duly incorporated,
      validly existing and (except where such concept is not applicable) in good
      standing under the laws of its jurisdiction of incorporation, and has all
      corporate powers and all material governmental licenses, authorizations,
      consents and approvals required to carry on its business as now
      conducted.

     

    SECTION
      4.09. Not
      an
      Investment Company.
      The
      Company is not an "investment company" within the meaning of the Investment
      Company Act of 1940, as amended.

     

    SECTION
      4.10. Obligations
      to be Pari Passu.
      The
      Company's obligations under this Agreement and each other Credit Document to
      which it is a party rank pari passu as to priority of payment and in all other
      respects with all other unsecured and unsubordinated Debt of the
      Company.

     

    SECTION
      4.11. No
      Default.
      No
      event has occurred and is continuing which constitutes, or which, with the
      passage of time or the giving of notice or both, would constitute, a default
      under or in respect of any material agreement, instrument or undertaking to
      which the Company or any Restricted Subsidiary is a party or by which either
      the
      Company or any Restricted Subsidiary or any of their respective assets is bound,
      unless such default would not have or be reasonably expected to have a Material
      Adverse Effect.

     

    SECTION
      4.12. Restricted
      Subsidiaries.
      Set
      forth as Schedule II hereto is a true, correct and complete list of each
      Restricted Subsidiary as of the date hereof.
       

      SECTION
        4.13. Environmental
        Matters.
        The
        Company has reasonably concluded that Environmental Laws are unlikely to
        have a
        Material Adverse Effect.

       

      SECTION
        4.14. Full
        Disclosure.
        All
        written information heretofore furnished by the Company to the Administrative
        Agent or any Bank for purposes of or in connection with this Agreement or
        any
        transaction contemplated hereby is, and all such information hereafter furnished
        by the Company to the Administrative Agent or any Bank will be, true and
        accurate in all material respects on the date as of which such information
        is
        stated or certified. To the 

    

     

    
      
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    best
      of
      its knowledge, the Company has disclosed to the Banks in writing any and all
      facts which materially and adversely affect or may materially and adversely
      affect (to the extent the Company can now reasonably foresee) the business,
      consolidated financial condition or consolidated results of operations of the
      Company and its Consolidated Subsidiaries, taken as a whole, or the ability
      of
      each Account Party to perform its obligations under the Credit Documents to
      which it is a party.

     

    SECTION
      4.15. Separate
      Representations of Subsidiary Account Parties.
      Each of
      the Subsidiary Account Parties represents and warrants that:

     

    (a) Such
      Subsidiary Account Party is a company duly organized and validly existing under
      the laws of the jurisdiction of its organization, and has all corporate power
      and all material governmental licenses, authorizations, consents and approvals
      required to carry on its business as now conducted.

     

    (b) The
      execution, delivery and performance by such Subsidiary Account Party of this
      Agreement and each other Credit Document to which it is a party are within
      such
      Subsidiary Account Party's corporate powers, have been duly authorized by all
      necessary corporate action, require no action by or in respect of, or filing
      with, any governmental body, agency or official and do not contravene, or
      constitute a default under, any provision of applicable law or regulation or
      of
      any organizational document of such Subsidiary Account Party or of any material
      agreement, judgment, injunction, order, decree or other instrument binding
      upon
      such Subsidiary Account Party or result in the creation or imposition of any
      Lien on any asset of such Subsidiary Account Party.

    (c) The
      Credit Documents (including this Agreement) to which such Subsidiary Account
      Party is a party constitute the legal, valid and binding obligations of such
      Subsidiary Account Party, in each case enforceable in accordance with their
      respective terms, except as the same may be limited by bankruptcy, insolvency
      or
      similar laws affecting creditors' rights generally and by general principles
      of
      equity.

     

    (d) Such
      Subsidiary Account Party is not an "investment company" within the meaning
      of
      the Investment Company Act of 1940, as amended.

     

    (e) Such
      Subsidiary Account Party's obligations under this Agreement to which it is
      a
      party rank pari passu as to priority of payment and in all other respects with
      all other unsecured and unsubordinated Debt of such Subsidiary Account Party
      with the exception of those obligations that are mandatorily preferred by law
      and not by contract.

     

    

      
        
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    (f) No
      event
      has occurred and is continuing which constitutes or which, with the passage
      of
      time or the giving of notice or both, would constitute, a default under or
      in
      respect of any material agreement, instrument or undertaking to which such
      Subsidiary Account Party is a party or by which either such Subsidiary Account
      Party or any of its assets is bound.

     

    (g) Such
      Subsidiary Account Party is not the subject of (i) any winding up (whether
      compulsory or otherwise) or any other corporate, judicial or administrative
      proceeding or action which could result in the winding up of such Subsidiary
      Account Party or (ii) any other proceeding or action relating to the insolvency,
      bankruptcy, liquidation, moratorium on the payment of obligations or any other
      similar condition of or relating to such Subsidiary Account Party, and such
      Subsidiary Account Party has taken no action in furtherance of any of the
      foregoing.

    ARTICLE
      V

     

    COVENANTS

     

    Until
      all
      Commitments have expired or been terminated, the principal of and interest
      on
      each Loan and all fees payable hereunder shall have been paid in full and all
      Letters of Credit shall have expired or terminated and all LC Disbursements
      shall have been reimbursed, the Company and (in the case of
      Sections 5.01(l), 5.02, 5.03, 5.04, 5.05, 5.06, 5.08, 5.10 and 5.11) the
      Subsidiary Account Parties agree that:

     

    SECTION
      5.01. Information.
      The
      Company (and, in the case of Section 5.01(l), each Subsidiary Account
      Party, but only as to information concerning such Subsidiary Account Party
      and
      its Subsidiaries) will deliver to each of the Banks:

     

    (a) within
      90
      days after the end of each fiscal year of the Company, if and only to the extent
      not duplicative of information otherwise provided pursuant to clause (i)
      below, the consolidated balance sheet of the Company and its Consolidated
      Subsidiaries as of the end of such fiscal year and the related consolidated
      statements of income, cash flows and shareholders' equity for such fiscal year,
      setting forth in each case in comparative form the figures for the previous
      fiscal year, all reported on in a manner acceptable to the Securities and
      Exchange Commission by Ernst & Young LLP or other independent public
      accountants of nationally recognized standing;

     

    (b) within
      60
      days after the end of each of the first three quarters of each fiscal year
      of
      the Company, if and only to the extent not duplicative of information otherwise
      provided pursuant to clause (i) 

     

     

     

     

    
      
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      below,
        the consolidated balance sheet of the Company and its Consolidated Subsidiaries
        as of the end of such quarter and the related consolidated statements of
        income,
        cash flows and shareholders' equity for such quarter and for the portion
        of the
        Company's fiscal year ended at the end of such quarter, setting forth in
        each
        case in comparative form the figures for the corresponding quarter and the
        corresponding portion of the Company's previous fiscal year, all certified
        (subject to normal year-end adjustments) as to fairness of presentation,
        generally accepted accounting principles and consistency with the most recent
        audited consolidated financial statements of the Company and its Consolidated
        Subsidiaries delivered to the Banks (except for changes concurred in by the
        Company's independent public accountants) by the chief financial officer
        or the
        chief accounting officer of the Company;

       

      (c) simultaneously
        with the delivery of each set of financial statements referred to in
        clauses (a) and (b) above (whether delivered as provided therein or
        pursuant to clause (i) below), a certificate of the chief financial officer
        or the chief accounting officer of the Company (i) setting forth in
        reasonable detail the calculations required to establish whether the Company
        was
        in compliance with the requirements of Section 5.07 on the date of such
        financial statements and (ii) stating that such chief financial officer or
        chief accounting officer, as the case may be, has no knowledge of any Default
        existing on the date of such certificate or, if such chief financial officer
        or
        chief accounting officer has knowledge of the existence on such date of any
        Default, setting forth the details thereof and the action which the Company
        or
        the applicable Subsidiary Account Party, as the case may be is taking or
        proposes to take with respect thereto;

    

     

    (d) simultaneously
      with the delivery of each set of financial statements referred to in clause
      (a)
      above (whether delivered as provided therein or pursuant to clause (i) below),
      a
      statement of the firm of independent public accountants which reported on such
      statements (i) as to whether anything has come to their attention to cause
      them
      to believe that any Default existed on the date of such statements and
      (ii) confirming the calculations set forth in the officer's certificate
      delivered simultaneously therewith pursuant to clause (c)
      above;

     

    (e) within
      120 days after the end of each fiscal year of each Insurance Subsidiary, a
      copy
      of a duly completed and signed Annual Statement (or any successor form thereto)
      required to be filed by such Insurance Subsidiary with the governmental body,
      agency or official which regulates insurance companies in the jurisdiction
      in
      which such Insurance Subsidiary is domiciled, in the form submitted to such
      governmental body, agency or official;

     

     

     

    
      
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      (f) within
        60
        days after the end of each of the first three fiscal quarters of each Insurance
        Subsidiary, a copy of a duly completed and signed Quarterly Statement (or
        any
        successor form thereto) required to be filed by such Insurance Subsidiary
        with
        the governmental body, agency or official which regulates insurance companies
        in
        the jurisdiction in which such Insurance Subsidiary is domiciled, in the
        form
        submitted to such governmental body, agency or official;

       

      (g) forthwith
        upon learning of the occurrence of any Default, a certificate of the chief
        financial officer or the chief accounting officer of the Company setting
        forth
        the details thereof and the action which the Company is taking or proposes
        to
        take with respect thereto;

       

      (h) promptly
        upon the mailing thereof to the shareholders of the Company generally, if
        and
        only to the extent not duplicative of information otherwise provided
        pursuant to clause (i) below, copies of all financial statements, reports
        and proxy statements so mailed;

    

     

    (i) promptly
      upon the filing thereof, copies of all registration statements (other than
      the
      exhibits thereto and any registration statements on Form S-8 or its
      equivalent) and reports on Forms 10-K, 10-Q and 8-K (or their equivalents)
      which any Account Party shall have filed with the Securities and Exchange
      Commission;

     

    (j) if
      and
      when any member of the ERISA Group (i) gives or is required to give notice
      to the PBGC of any "reportable event" (as defined in Section 4043 of ERISA)
      with respect to any Plan which might constitute grounds for a termination of
      such Plan under Title IV of ERISA, or knows that the plan administrator of
      any Plan has given or is required to give notice of any such reportable event,
      a
      copy of the notice of such reportable event given or required to be given to
      the
      PBGC; (ii) receives notice of complete or partial withdrawal liability
      under Title IV of ERISA or notice that any Multiemployer Plan is in
      reorganization, is insolvent or has been terminated, a copy of such notice;
      (iii) receives notice from the PBGC under Title IV of ERISA of an
      intent to terminate, impose liability (other than for premiums under
      Section 4007 of ERISA) in respect of, or appoint a trustee to administer,
      any Plan, a copy of such notice; (iv) applies for a waiver of the minimum
      funding standard under Section 412 of the Code, a copy of such application;
      (v) gives notice of intent to terminate any Plan under Section 4041(c)
      of ERISA, a copy of such notice and other information filed with the PBGC;
      (vi) gives notice of withdrawal from any Plan pursuant to Section 4063
      of ERISA, a copy of such notice; or (vii) fails to make any payment or
      contribution to any Plan or Multiemployer Plan or in respect of any Benefit
      Arrangement or makes any amendment to any Plan or Benefit Arrangement which
      has
      resulted or could result in the imposition of a Lien or the posting of a bond
      

    
       

      
        
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    or
      other
      security, a certificate of the chief financial officer or the chief accounting
      officer of the Company setting forth details as to such occurrence and action,
      if any, which the Company or applicable member of the ERISA Group is required
      or
      proposes to take; 

     

    (k) promptly
      after Moody's or S&P shall have announced a change in the rating established
      or deemed to have been established for the Index Debt, written notice of such
      rating change; and

     

    (l) from
      time
      to time such additional information regarding the financial position or business
      of any Account Party as the Administrative Agent, at the request of any Bank,
      may reasonably request.

     

    SECTION
      5.02. Payment
      of Obligations.
      The
      Company will pay and discharge, and will cause each Restricted Subsidiary and
      Subsidiary Account Party to pay and discharge, at or before maturity, all their
      respective material obligations and liabilities, including, without limitation,
      tax liabilities, except where the same may be contested in good faith by
      appropriate proceedings, and will maintain, and will cause each Restricted
      Subsidiary to maintain, in accordance with generally accepted accounting
      principles, appropriate reserves for the accrual of any of the
      same.

     

    SECTION
      5.03. Conduct
      of Business and Maintenance of Existence.
      The
      Company will continue, and will cause each Restricted Subsidiary and Subsidiary
      Account Party to continue, to engage in business of the same general type as
      conducted by the Company and its Restricted Subsidiaries, taken as a whole,
      on
      the date hereof and will preserve, renew and keep in full force and effect,
      and
      will cause each Restricted Subsidiary to preserve, renew and keep in full force
      and effect, their respective corporate existence and their respective rights,
      privileges, licenses and franchises which, in the judgment of the Board of
      Directors of the Company, are necessary or desirable in the normal conduct
      of
      business.

     

    SECTION
      5.04. Maintenance
      of Property; Insurance.

     

    (a) The
      Company will keep, and will cause each Restricted Subsidiary and Subsidiary
      Account Party to keep, all property useful and necessary in its business in
      good
      working order and condition, ordinary wear and tear excepted.

     

    (b) The
      Company will maintain, and will cause each of its Restricted Subsidiaries to
      maintain (either in the name of the Company or in such Subsidiary's own name)
      with financially sound and responsible insurance companies, insurance on all
      their respective properties and against at least such risks, in each case in
      at
      least such amounts (and with such risk retentions) as are usually insured
      against in the same general area by companies of established repute engaged
      in
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    to
      the
      Banks, upon request from the Administrative Agent, information presented in
      reasonable detail as to the insurance so carried.

     

    SECTION
      5.05. Compliance
      with Laws.
      The
      Company will comply, and will cause each Subsidiary to comply, in all material
      respects with all applicable laws, ordinances, rules, regulations and
      requirements of governmental authorities (including, without limitation,
      Environmental Laws and ERISA and the rules and regulations thereunder) except
      where the necessity of compliance therewith is contested in good faith by
appropriate
      proceedings, except where such non-compliance therewith would not reasonably
      be
      expected to have a Material Adverse Effect.

     

    SECTION
      5.06. Inspection
      of Property, Books and Records.
      The
      Company will keep, and will cause each Restricted Subsidiary and Subsidiary
      Account Party to keep, proper books of record and account in which full, true
      and correct entries shall be made of all dealings and transactions in relation
      to its business and activities; and, subject in all cases to Section 10.11,
      will permit, and will cause each Restricted Subsidiary and Subsidiary Account
      Party to permit, representatives of any Bank to visit and inspect any of their
      respective properties, to examine and make abstracts from any of their
      respective books and records and to discuss their respective affairs, finances
      and accounts with their respective officers, employees, actuaries and
      independent public accountants, all upon reasonable notice, at such reasonable
      times during ordinary business hours and as often as may reasonably be desired;
      provided
      that
      neither the Company nor any of its Subsidiaries shall be required to disclose
      any information subject to its attorney-client privilege.

     

    SECTION
      5.07. Minimum
      Adjusted Consolidated Net Worth.
      The
      Company will not permit Adjusted Consolidated Net Worth to be less than (a)
      at
      any time prior to the consummation of the Jefferson-Pilot Acquisition and the
      delivery of the estimate contemplated in the last sentence of this Section,
      $4,082,000,000, (b) from and after the delivery of such estimate to but not
      including the last day of the first fiscal quarter ending after the consummation
      of the Jefferson-Pilot Acquisition, an amount equal to 70% of Estimated Adjusted
      Consolidated Net Worth (as defined below) and (c) at any time thereafter, an
      amount equal to 70% of Adjusted Consolidated Net Worth determined as of the
      end
      of the fiscal quarter or fiscal year, as applicable, of the Company ended
      immediately after the consummation of the Jefferson-Pilot Acquisition. Promptly
      but not later than 45 days following the consummation of the Jefferson-Pilot
      Acquisition, the Company shall furnish to the Administrative Agent a written
      estimate of the Adjusted Consolidated Net Worth, determined as of the end of
      the
      most recently completed fiscal quarter or fiscal year of the Company for which
      consolidated financial statements of the Company are then available and adjusted
      to give pro forma effect to the Jefferson-Pilot Acquisition ("Estimated
      Adjusted Consolidated Net Worth")
      (and
      the Administrative Agent shall promptly furnish a copy thereof to the
      Banks).

     

     

    

      
        
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    SECTION
      5.08. Negative
      Pledge.
      The
      Company will not, and will not permit any Subsidiary to, create or suffer to
      exist any Lien upon any present or future capital stock or any other Securities
      of any of its Material Subsidiaries.

     

    SECTION
      5.09. Consolidations,
      Mergers and Sales of Assets.
      The
      Company will not (i) consolidate or merge with or into any other Person or
      (ii) sell, lease or otherwise transfer, directly or indirectly, all or
      substantially all of the assets of the Company and its Subsidiaries, taken
      as a
      whole, to any other Person; provided
      that the
      Company may merge with another Person if (A) the Company is the corporation
      surviving such merger and (B) immediately after giving effect to such
      merger, no Default shall have occurred and be continuing.

     

    SECTION
      5.10. Use
      of
      Credit.
      Each
      Account Party shall use each Letter of Credit issued under this Agreement to
      support its insurance or reinsurance business. The proceeds of each Loan made
      hereunder will be used for general corporate purposes of the Company. No Letter
      of Credit or proceeds of Loans will be used, directly or indirectly, for the
      purpose, whether immediate, incidental or ultimate, of buying or carrying any
      "margin stock" within the meaning of Regulations T, U and X.

     

    SECTION
      5.11. Obligations
      to be Pari Passu.
      Each
      Account Party's obligations under this Agreement and the other Credit Documents
      to which it is a party will rank at all times pari passu as to priority of
      payment and in all other respects with all other unsecured and unsubordinated
      Debt of such Account Party with the exception of those obligations that are
      mandatorily preferred by law and not by contract.

     

    SECTION
      5.12. Termination
      of Jefferson-Pilot Credit Facility.
      Upon
      the consummation of the Jefferson-Pilot Acquisition, the Company will terminate
      the commitments of the lenders and pay all amounts owing under (a) the Credit
      Agreement dated as of December 23, 2004 among TSC Reassurance (Bermuda) Ltd.,
      as
      account party, Jefferson-Pilot Corporation, as guarantor, the lenders party
      thereto and Wachovia Bank, National Association, as administrative agent, as
      amended, and (b) the Credit Agreement dated as of May 7, 2002, among the
      Jefferson-Pilot Corporation, as guarantor, the lenders party thereto and Bank
      of
      America, N.A., as administrative agent, as amended. 

     

     

    

      
        
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    ARTICLE
      VI

     

    DEFAULTS

     

    SECTION
      6.01. Events
      of Default.
      If one
      or more of the following events ("Events
      of Default")
      shall
      have occurred and be continuing:

     

    (a) (i) the
      Company or any Account Party shall fail to pay when due any principal of any
      Loan or any reimbursement obligation in respect
      of an LC Disbursement or (ii) any Account Party shall fail to pay when due
      any interest on any Loan or LC Disbursement or any fees or any other amounts
      payable hereunder and such failure under this clause (ii) shall continue
      for four Domestic Business Days;

     

    (b) any
      Account Party shall fail to observe or perform any covenant contained in
      Sections 5.07 through 5.11, inclusive;

     

    (c) any
      Account Party shall fail to observe or perform any covenant or agreement
      contained in this Agreement (other than those covered by clause (a) or (b)
      above) for 30 days after written notice thereof has been given to the Company
      by
      the Administrative Agent at the request of any Bank;

     

    (d) any
      representation, warranty, certification or statement made by any Account Party
      in this Agreement or in any certificate, financial statement or other document
      delivered pursuant to this Agreement shall prove to have been incorrect in
      any
      material respect when made (or deemed made);

     

    (e) the
      Company or any Subsidiary (other than a Newly Acquired Subsidiary) shall fail
      to
      make any payment in respect of any Debt (other than Loans and other extensions
      of credit hereunder and any Debt solely of a Newly Acquired Subsidiary existing
      at the time such Person becomes a Subsidiary and not created in contemplation
      of
      such event ("Newly
      Acquired Subsidiary Debt"))
      having a principal amount then outstanding of not less than $75,000,000 when
      due
      and such failure shall continue beyond any applicable grace period or the
      Company or any Subsidiary (other than a Newly Acquired Subsidiary) shall fail
      to
      make any payment in an amount at least equal to $75,000,000 in respect of any
      Derivative Financial Product when due and such failure shall continue beyond
      any
      applicable grace period;

     

    (f) any
      event
      or condition shall occur which results in the acceleration of the maturity
      of
      any Debt (other than Loans and other extensions of credit hereunder and Newly
      Acquired Subsidiary Debt) having a principal or face amount then outstanding
      of
      not less than $75,000,000 of the Company or any Subsidiary or enables (or,
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    giving
      of notice or lapse of time or both, would
      enable) the holder of such Debt or any Person acting on such holder's behalf
      to
      accelerate the maturity 

    thereof;

     

    (g) any
      Account Party or Restricted Subsidiary (other than a Newly Acquired Subsidiary)
      shall commence a voluntary case or other proceeding seeking rehabilitation,
      dissolution, conservation, liquidation, reorganization or other relief with
      respect to itself or its debts under any bankruptcy,
      insolvency or other similar law now or hereafter in effect or seeking the
      appointment of a trustee, receiver, liquidator, rehabilitator, dissolver,
      conservator, custodian or other similar official of it or any substantial part
      of its property, or shall consent to any such relief or to the appointment
      of or
      taking possession by any such official in an involuntary case or other
      proceeding commenced against it, or shall make a general assignment for the
      benefit of creditors, or shall fail generally to pay its debts as they become
      due, or shall take any corporate action to authorize any of the
      foregoing;

     

    (h) an
      involuntary case or other proceeding shall be commenced against any Account
      Party or Restricted Subsidiary (other than a Newly Acquired Subsidiary) seeking
      rehabilitation, dissolution, conservation, liquidation, reorganization or other
      relief with respect to it or its debts under any bankruptcy, insolvency or
      other
      similar law now or hereafter in effect or seeking the appointment of a trustee,
      receiver, liquidator, rehabilitator, dissolver, conservator, custodian or other
      similar official of it or any substantial part of its property, and such
      involuntary case or other proceeding shall remain undismissed and unstayed
      for a
      period of 60 days; or an order for relief shall be entered against any Account
      Party or such Restricted Subsidiary under the federal bankruptcy laws as now
      or
      hereafter in effect; or any governmental body, agency or official shall apply
      for, or commence a case or other proceeding to seek, an order for the
      rehabilitation, conservation, dissolution or other liquidation of Account Party
      or Restricted Subsidiary or of the assets or any substantial part thereof of
      any
      Account Party or Restricted Subsidiary or any other similar remedy;

     

    (i) any
      of
      the following events or conditions shall occur, which, in the aggregate,
      reasonably could be expected to involve possible taxes, penalties and other
      liabilities in an aggregate amount in excess of $75,000,000: (i) any member
      of
      the ERISA Group shall fail to pay when due any amount or amounts which it shall
      have become liable to pay under Title IV of ERISA; (ii) notice of intent to
      terminate a Plan shall be filed under Title IV of ERISA by any member of the
      ERISA Group, any plan administrator or any combination of the foregoing; (iii)
      the PBGC shall institute proceedings under Title IV of ERISA to terminate,
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    respect
      of, or to cause a trustee to be appointed to administer, any
      Plan; (iv) a condition shall exist by reason of which the PBGC would be entitled
      to obtain a decree adjudicating that any Plan must be terminated; or (v) there
      shall occur a complete or partial withdrawal from, or a default, within the
      meaning of Section 4219(c)(5) of ERISA, with respect to, one or more
      Multiemployer Plans;

     

    (j) a
      judgment or order for the payment of money in excess of the greater of (i)
      $150,000,000 or (ii) 3% of the consolidated shareholders' equity of the Company
      and its Consolidated Subsidiaries (after (without duplication) the actual
      amounts of insurance recoveries, offsets and contributions received and amounts
      thereof not yet received but which the insurer thereon has acknowledged in
      writing its obligation to pay) shall be rendered against any Account Party
      or
      Restricted Subsidiary and such judgment or order shall continue unsatisfied
      and
      unstayed for a period of 90 days after entry of such judgment (and, for purposes
      of this clause, a judgment shall be stayed if, among other things, an appeal
      is
      timely filed and such judgment cannot be enforced);

     

    (k) (i)
      any
      person or group of persons (within the meaning of Section 13 or 14 of the
      Securities Exchange Act of 1934, as amended) shall have acquired beneficial
      ownership (within the meaning of Rule 13d-3 promulgated by the Securities and
      Exchange Commission under said Act) of 20% or more of the outstanding shares
      of
      common stock of the Company; or (ii) occupation of a majority of the seats
      (other than vacant seats) on the board of directors of the Company by Persons
      who were neither (x) nominated by the board of directors of the Company or
      (y)
      appointed by directors so nominated; or

     

    (l) any
      Subsidiary Account Party shall cease for any reason to be a Consolidated
      Subsidiary, unless (i) such Subsidiary Account Party shall have been
      consolidated or merged with or into a wholly owned Subsidiary or the Company
      or
      (ii) Subsidiary Account Party shall have been terminated as an Account
      Party hereunder pursuant to Section 10.13;

     

    then,
      and
      in every such event, and at any time thereafter during the continuance of such
      event, the Administrative Agent shall, if requested by the Required Banks,
      by
      notice to the Company take any or all of the following actions, at the same
      or
      different times: (i) terminate the Commitments and they shall thereupon
      terminate, (ii) declare the Loans then outstanding to be due and payable in
      whole (or in part, in which case any principal not so declared to be due and
      payable may thereafter be declared to be due and payable), and thereupon the
      principal of the Loans so declared to be due and payable, together with accrued
      interest thereon and all fees and other obligations of the Account Parties
      accrued hereunder shall become due and payable immediately, without presentment,
      demand, protest or other notice of any kind, all of which are hereby waived
      by
      each Account Party

     

    
      
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     and
      the Guarantor, (iii) notify (or, in the case of any Fronted Letter of Credit,
      request the applicable Fronting Issuing Bank (and such Fronting Issuing Bank
      agrees upon such request) to notify) each beneficiary of an outstanding Letters
      of Credit of the existence of an Event of Default hereunder and cause a drawing
      of the aggregate undrawn amount thereunder (if such Letters of Credit so permit)
      and (iv) demand provision of cover from the Account Parties and the
      Guarantor in immediately available funds in an amount equal to the then
      aggregate undrawn amount of all Letters of Credit pursuant to Section 2.03(e);
      provided
      that, in
      the case of any of the Events of Default specified in clause (g) or (h)
      above (A) with respect to the Company, without any notice to any Account
      Party or the Guarantor or any other act by the Administrative Agent or the
      Banks, the Commitments shall thereupon terminate and the principal of the Loans
      then outstanding, together with accrued interest thereon and all fees and other
      obligations of the Account Parties accrued hereunder, shall automatically become
      due and payable without presentment, demand, protest or notice of any kind,
      all
      of which are hereby waived by each Account Party and the Guarantor and (B)
      with
      respect to any Account Party, without any notice to any Account Party or the
      Guarantor or any other act by the Administrative Agent or the Banks, the
      Commitments to issue Letters of Credit for the account of such Account Party
      shall thereupon terminate and all fees and other obligations of such Account
      Party shall become immediately due and payable without presentment, demand,
      protest or notice of any kind, all of which are hereby waived by the Account
      Parties and the Guarantor; provided,
      further,
      that,
      in the case of an Event of Default under Section 6.01(b) resulting from a
      default by any Subsidiary Account Party under Section 5.08, 5.10 or 5.11 or
      under Section 6.01(c) or (d) (in the latter case, resulting from a default
      by any Subsidiary Account Party under Section 4.15), the termination of the
      Commitments, the acceleration of all fees and other obligations of the Account
      Parties accrued hereunder and the causing of drawings under Letters of Credit
      shall apply only to the Commitments, fees, obligations in respect of such
      Subsidiary Account Party and to the Letters of Credit with respect to which
      it
      is the Account Party.

     

    SECTION
      6.02. Notice
      of Default.
      The
      Administrative Agent shall give notice to the Company under Section 6.01(c)
      promptly upon being requested to do so by any Bank and shall thereupon notify
      all the Banks thereof.

     

    ARTICLE
      VII

     

    THE
      ADMINISTRATIVE AGENT

     

    SECTION
      7.01. Appointment
      and Authorization.
      Each
      Bank irrevocably appoints and authorizes the Administrative Agent to take such
      action as agent on its behalf and to exercise such powers under this Agreement
      and the other Credit Documents as are delegated to the Administrative Agent
      by
      the terms hereof or thereof, together with all such powers as are reasonably
      incidental thereto.

     

     

    
      
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      SECTION
        7.02. Agent's
        Fee. The Company shall pay to the Administrative Agent for its own
        account fees in the amounts and at the times previously agreed upon between
        the
        Company and the Administrative Agent.

    

     

    SECTION
      7.03. Agent
      and Affiliates.
      JPMCB
      shall have the same rights and powers under this Agreement as any other Bank
      and
      may exercise or refrain from exercising the same as though it were not the
      Administrative Agent, and JPMCB and its Affiliates may accept deposits from,
      lend money to, and generally engage in any kind of business with the Company
      or
      any Subsidiary or Affiliate of any thereof as if it were not the Administrative
      Agent hereunder.

     

    SECTION
      7.04. Action
      by Agent.
      The
      obligations of the Administrative Agent hereunder are only those expressly
      set
      forth herein. The Administrative Agent shall not have any duty to take any
      discretionary action permitted to be taken by it pursuant to the provisions
      of
      this Agreement unless it shall be requested in writing to do so by the Required
      Banks. Without limiting the generality of the foregoing, the Administrative
      Agent shall not be required to take any action with respect to any Default,
      except as expressly provided in Article VI. The Administrative Agent shall
      have no duty to disclose to the Banks information that is not required to be
      furnished by an Account Party to the Administrative Agent at such time, but
      is
      voluntarily furnished by an Account Party to the Administrative Agent (either
      in
      its capacity as Administrative Agent or in its individual
      capacity).

     

    SECTION
      7.05. Consultation
      with Experts.
      The
      Administrative Agent may consult with legal counsel (who may be counsel for
      any
      Account Party), independent public accountants and other experts selected by
      it
      and shall not be liable for any action taken or omitted to be taken by it in
      good faith in accordance with the advice of such counsel, accountants or
      experts.

     

    SECTION
      7.06. Liability
      of Agent.
      Neither
      the Administrative Agent nor any of its directors, officers, agents or employees
      shall be liable to any Bank for any action taken or not taken by it in
      connection herewith (i) with the consent or at the request of the Required
      Banks or (ii) in the absence of its own gross negligence or willful
      misconduct. The Administrative Agent shall be deemed not to have knowledge
      of
      any Default unless and until written notice thereof is given to the
      Administrative Agent by an Account Party or a Bank. Neither the Administrative
      Agent nor any of its directors, officers, agents or employees shall be
      responsible to any Bank for or have any duty to any Bank to ascertain, inquire
      into or verify (i) any statement, warranty or representation made in
      connection with this Agreement or any borrowing hereunder or the issuance,
      amendment, renewal or extension of any Letter of Credit; (ii) the
      performance or observance of any of the covenants or agreements of any Account
      Party; (iii) the satisfaction of any condition specified in
      Article III, except receipt of items required to be delivered to the
      Administrative Agent; (iv) the validity, effectiveness or genuineness of
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    any
      other
      instrument or writing furnished in connection herewith; (v) the existence
      or possible existence of any Default; (vi) the financial condition of any
      Account Party or any Account Party's Subsidiaries; or (vii) the contents of
      any certificate, report or other document delivered hereunder or in connection
      herewith. The Administrative Agent shall not incur any liability by acting
      in
      reliance upon any notice, consent, certificate, statement, or other writing
      (which may be a bank wire, telex or similar writing) believed by it in good
      faith to be genuine or to be signed by the proper party or parties.

     

    SECTION
      7.07. Indemnification.
      Each
      Bank shall, ratably in accordance with its Commitment (determined as of the
      time
      that the applicable unreimbursed expense or indemnity payment is sought),
      indemnify the Administrative Agent (to the extent not reimbursed by the Company)
      against any cost, expense (including counsel fees and disbursements), claim,
      demand, action, loss or liability (except such as result from the Administrative
      Agent's gross negligence or willful misconduct) that the Administrative Agent
      may suffer or incur in connection with this Agreement or any action taken or
      omitted by the Administrative Agent hereunder. The Administrative Agent shall
      be
      fully justified in failing or refusing to take any action hereunder unless
      it
      shall first be indemnified to its satisfaction by the Banks pro rata against
      any
      and all liability, cost and expense that it may incur by reason of taking or
      continuing to take any such action.

     

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

     

    SECTION
      7.09. Successor
      Agent.
      The
      Administrative Agent may resign at any time by giving written notice thereof
      to
      the Banks and the Company. Upon any such resignation, the Required Banks shall
      have the right to appoint a successor Administrative Agent, which successor
      Administrative Agent shall be satisfactory to the Company, provided
      that no Default is continuing. If no successor Administrative Agent shall
      have been so appointed by the Required Banks, and shall have accepted such
      appointment, within 30 days after the retiring Administrative Agent gives notice
      of resignation, then the retiring Administrative Agent may, on behalf of the
      Banks, appoint a successor Agent, which shall be a commercial bank organized
      or
      licensed under the laws of the United States of America or of any State thereof
      and having a combined capital and surplus of at least $100,000,000 and (unless
      a
      Default has occurred and is continuing) shall otherwise be subject to the
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    unreasonably
      withheld. Upon the acceptance of its appointment as Administrative Agent
      hereunder by a successor Administrative Agent, such successor Administrative
      Agent shall thereupon succeed to and become vested with all the rights and
      duties of the retiring Administrative Agent, and the retiring Administrative
      Agent shall be discharged from its duties and obligations hereunder. After
      any
      retiring Administrative Agent's resignation hereunder as Administrative Agent,
      the provisions of this Article shall inure to its benefit as to any actions
      taken or omitted to be taken by it while it was Administrative
      Agent.

     

    SECTION
      7.10. Delegation
      to Affiliates.
      The
      Account Party and the Banks agree that the Administrative Agent may delegate
      any
      of its duties under this Agreement to any of its Affiliates. Any such Affiliate
      (and such Affiliate's directors, officers, agents and employees) which performs
      duties in connection with this Agreement shall be entitled to the same benefits
      of the indemnification, waiver and other protective provisions to which the
      Administrative Agent is entitled under Articles VII and X.

     

    SECTION
      7.11. Joint
      Lead Arrangers and Other Agents.
      Notwithstanding anything herein to the contrary, neither the Joint Lead
      Arrangers and Joint Bookrunners nor the Syndication Agent listed on the cover
      page of this Agreement shall have any right, power, obligation, liability,
      responsibility or duty under this Agreement in its capacity as such, except
      in
      its respective capacity, if any, as a Bank.

    ARTICLE
      VIII

     

    CHANGE
      IN
      CIRCUMSTANCES

     

    SECTION
      8.01. Basis
      for Determining Interest Rate Inadequate or Unfair.
      If on
      or prior to the first day of any Interest Period for any Euro-Dollar
      Borrowing:

     

    (a) the
      Administrative Agent determines (which determination shall be conclusive absent
      manifest error) that adequate and reasonable means do not exist for ascertaining
      the LIBO Rate for such Interest Period, or

     

    (b) the
      Required Banks advise the Administrative Agent that the LIBO Rate as determined
      by the Administrative Agent will not adequately and fairly reflect the cost
      to
      such Banks of funding their Euro-Dollar Loans for such Interest
      Period,

     

    the
      Administrative Agent shall forthwith give notice thereof to the Company and
      the
      Banks, whereupon until the Administrative Agent notifies the Company that the
      circumstances giving rise to such suspension no longer exist, the obligations
      of
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    Company
      notifies the Administrative Agent at least two Domestic Business Days before
      the
      date of any Euro-Dollar Borrowing for which a Notice of Borrowing has previously
      been given that it elects not to borrow on such date, such Borrowing shall
      instead be made as a Base Rate Borrowing.

     

    SECTION
      8.02. Illegality.
      If,
      after the date of this Agreement, the adoption of any applicable law, rule
      or
      regulation, or any change in any applicable law, rule or regulation, or any
      change in the interpretation or administration thereof by any governmental
      authority, central bank or comparable agency charged with the interpretation
      or
      administration thereof, or compliance by any Bank (or its Applicable Lending
      Office) with any request or directive (whether or not having the force of law)
      of any such authority, central bank or comparable agency shall make it unlawful
      or impossible for any Bank (or its Applicable Lending Office) to make, continue,
      maintain or fund its Euro-Dollar Loans and such Bank shall so notify the
      Administrative Agent, the Administrative Agent shall forthwith give notice
      thereof to the other Banks and the Company, whereupon until such Bank notifies
      the Company and the Administrative Agent that the circumstances giving rise
      to
      such suspension no longer exist, the obligation of such Bank to make Euro-Dollar
      Loans shall be suspended. Before giving any notice to the Administrative Agent
      pursuant to this Section, such Bank shall designate a different Applicable
      Lending Office if such designation will avoid the need for giving such notice
      and will not, in
      the
      judgment of such Bank, be otherwise disadvantageous to such Bank. If such Bank
      shall determine that it may not lawfully continue to maintain and fund any
      of
      its outstanding Euro-Dollar Loans to maturity and shall so specify in such
      notice, the Company shall immediately prepay in full the then outstanding
      principal amount of each such Euro-Dollar Loan, together with accrued interest
      thereon. Concurrently with prepaying each such Euro-Dollar Loan, the Company
      shall borrow a Base Rate Loan in an equal principal amount from such Bank (on
      which interest and principal shall be payable contemporaneously with the related
      Euro-Dollar Loans of the other Banks), and such Bank shall make such a Base
      Rate
      Loan.

     

    SECTION
      8.03. Increased
      Cost and Reduced Return.
      (a) If
      on or after the date hereof, in the case of any Loan or any obligation to make
      Loans or in the case of any Letter of Credit or any obligation to issue, renew
      or extend any Letter of Credit, the adoption of any applicable law, rule or
      regulation, or any change in any applicable law, rule or regulation, or any
      change in the interpretation or administration thereof by any governmental
      authority, central bank or comparable agency charged with the interpretation
      or
      administration thereof, or compliance by any Bank (or its Applicable Lending
      Office) with any request or directive (whether or not having the force of law)
      of any such authority, central bank or comparable agency shall impose, modify
      or
      deem applicable any reserve (including, without limitation, any such requirement
      imposed by the Board of Governors of the Federal Reserve System, but excluding
      with respect to any Euro-Dollar Loan any such requirement included in an
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    requirement against assets of, deposits with or for the
      account of, or credit extended by, any Bank (or its Applicable Lending Office)
      or shall impose on any Bank (or its Applicable Lending Office) or the London
      interbank market any other condition affecting its Euro-Dollar Loans, its Notes
      or its obligation to make Euro-Dollar Loans or its obligation to issue Letters
      of Credit, any outstanding Letters of Credit or reimbursement claims in respect
      of LC Disbursements and the result of any of the foregoing is to increase the
      cost to such Bank (or its Applicable Lending Office) of making or maintaining
      any Euro-Dollar Loan or of issuing or maintaining any Letter of Credit, or
      to
      reduce the amount of any sum received or receivable by such Bank (or its
      Applicable Lending Office) under this Agreement or under other Credit Document
      with respect thereto, by an amount deemed by such Bank to be material, then,
      within 15 days after demand by such Bank (with a copy to the Administrative
      Agent), the Company shall pay to such Bank such additional amount or amounts
      as
      will compensate such Bank for such increased cost or reduction.

     

    
      (b) If
        any Bank shall have determined that, after the date hereof, the adoption
        of any
        applicable law, rule or regulation regarding capital adequacy, or any change
        in
        any applicable law, rule or regulation regarding capital adequacy, or any
        change
        in the interpretation or administration thereof by any governmental authority,
        central bank or comparable agency charged with the interpretation or
        administration thereof, or any request or directive regarding capital adequacy
        (whether or not having the force of law) of any such authority, central bank
        or
        comparable agency, has or would have the effect of reducing the rate of return
        on capital of such Bank (or its Parent) as a consequence of such Bank's
        obligations hereunder to a level below that which such Bank (or its Parent)
        could have achieved but for such adoption, change, request or directive (taking
        into consideration its policies with respect to capital adequacy) by an amount
        deemed by such Bank to be material, then from time to time, within 15 days
        after
        demand by such Bank (with a copy to the Administrative Agent), the Company
        shall
        pay to such Bank such additional amount or amounts as will compensate such
        Bank
        (or its Parent) for such reduction.

    

     

    (c) Each
      Bank
      will promptly notify the Company and the Administrative Agent of any event
      of
      which it has knowledge, occurring after the date hereof, which will entitle
      such
      Bank to compensation pursuant to this Section and will designate a different
      Applicable Lending Office if such designation will avoid the need for, or reduce
      the amount of, such compensation and will not, in the judgment of such Bank,
      be
      otherwise disadvantageous to such Bank. A certificate of any Bank claiming
      compensation under this Section and setting forth the additional amount or
      amounts to be paid to it hereunder and, in reasonable detail, such Bank's
      computation of such amount or amounts, shall be conclusive in the absence of
      manifest error. In determining such amount, such Bank may use any reasonable
      averaging and attribution methods.

     

     

    
      
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    SECTION
      8.04. Base
      Rate Loans Substituted for Affected Euro-Dollar Loans.
      If (i)
      the obligation of any Bank to make or continue Euro-Dollar Loans has been
      suspended pursuant to Section 8.02 or (ii) any Bank has demanded compensation
      under Section 8.03(a) or 8.05 and the Company shall, by at least five
      Euro-Dollar Business Days' prior notice to such Bank through the Administrative
      Agent, have elected that the provisions of this Section shall apply to such
      Bank, then, unless and until such Bank notifies the Company that the
      circumstances giving rise to such suspension or demand for compensation no
      longer apply:

     

    (a) all
      Loans
      which would otherwise be made, or continued, by such Bank as Euro-Dollar Loans
      shall be made instead as, or converted into, Base Rate Loans (on which interest
      and principal shall be payable contemporaneously with the related Euro-Dollar
      Loans of the other Banks), and

    (b) after
      each of its Euro-Dollar Loans has been repaid, all payments of principal which
      would otherwise be applied to repay such Euro-Dollar Loans shall be applied
      to
      repay its Base Rate Loans instead.

     

    SECTION
      8.05. Taxes.
      (a) For
      purposes of this Section, the following terms have the following
      meanings:

     

    "Taxes"
      means
      any and all present or future taxes, duties, levies, imposts, deductions,
      charges or withholdings of any nature with respect to any payment by any Account
      Party or the Guarantor pursuant to this Agreement or any other Credit Document,
      and all liabilities with respect thereto, excluding, in the case of each Bank
      and the Administrative Agent, taxes imposed on its net income, and franchise
      or
      similar taxes imposed on it, by a jurisdiction under the laws of which such
      Bank
      or the Administrative Agent (as the case may be) is organized or in which its
      principal executive office is located or, in the case of each Bank, in which
      its
      Applicable Lending Office is located (all such excluded taxes being hereinafter
      referred to as "Domestic
      Taxes").
      If
      the form provided by a Bank pursuant to Section 8.05(d) at the time such Bank
      first becomes a party to this Agreement indicates a United States interest
      withholding tax rate in excess of zero, any United States interest withholding
      tax at such rate imposed on payments by the Company under this Agreement or
      any
      other Credit Document shall be excluded from the definition of
      "Taxes".

     

    "Other
      Taxes"
      means
      any present or future stamp or documentary taxes and any other excise or
      property taxes, or similar charges or levies, which arise from any payment
      made
      pursuant to this Agreement or any other Credit Document or from the execution,
      delivery, registration or enforcement of, or otherwise with respect to, this
      Agreement or any other Credit Document.

     

    
       

      
        
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    (b) Any
      and
      all payments by any Account Party or the Guarantor to or for the account of
      any
      Bank or the Administrative Agent hereunder or under any other Credit Document
      shall be made without deduction or withholding for any Taxes or Other Taxes;
      provided
      that, if
      any Account Party or the Guarantor shall be required by law to deduct any Taxes
      or Other Taxes from any such payments, (i) the sum payable shall be increased
      as
      necessary so that after making all required deductions and withholdings
      (including deductions and withholdings applicable to additional sums payable
      under this Section) such Bank or the Administrative Agent (as the case may
      be)
      receives an amount equal to the sum it would have received had no such
      deductions or withholdings been made, (ii) such Account Party or the Guarantor
      (as the case may be) shall make such deductions or withholdings, (iii) such
      Account Party or the Guarantor (as the case may be) shall pay the full amount
      deducted or withheld to the relevant taxation authority or other authority
      in
      accordance with applicable law and (iv) such Account Party or the Guarantor
      (as
      the case may be) shall promptly furnish to
      the
      Administrative Agent, at its address referred to in Section 10.01, the original
      or a certified copy of a receipt evidencing payment thereof, and, if such
      receipt relates to Taxes or Other Taxes in respect of a sum payable to any
      Bank,
      the Administrative Agent shall promptly deliver such original or certified
      copy
      to such Bank.

     

    (c) The
      Company agrees to indemnify each Bank and the Administrative Agent for the
      full
      amount of Taxes or Other Taxes (including, without limitation, any Taxes or
      Other Taxes imposed or asserted by any jurisdiction on amounts payable under
      this Section), whether or not correctly or legally imposed, paid by such Bank
      or
      the Administrative Agent (as the case may be) and any liability (including
      penalties, interest and expenses) arising therefrom or with respect thereto.
      In
      addition, the Company agrees to indemnify each Bank and the Administrative
      Agent
      for all Domestic Taxes of such Bank or the Administrative Agent (calculated
      based on a hypothetical basis at the maximum marginal rate for a corporation)
      and any liability (including penalties, interest and expenses to the extent
      not
      attributable to the gross negligence or willful misconduct of each Bank or
      the
      Administrative Agent, as the case may be) arising therefrom or with respect
      thereto, in each case to the extent that such Domestic Taxes result from any
      payment or indemnification pursuant to this Section for any taxes imposed by
      any
      jurisdiction for which the Company or any Account Party is responsible under
      Sections 8.05(a), (b) or (c). This indemnification shall be paid within 30
      days
      after such Bank or Agent, as the case may be, makes demand
      therefor.

     

    (d) At
      least
      five Domestic Business Days prior to the first date on which interest or fees
      are payable hereunder for the account of any Bank, each Bank that is not
      incorporated under the laws of the United States of America or a state thereof
      agrees that it will deliver to each of the Company and the Administrative Agent
      two duly completed copies of United States Internal Revenue Service Form W-8BEN
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    Bank
      is
      entitled to receive payments under this Agreement and the Notes without
      deduction or withholding of any United States federal income taxes. Each Bank
      which so delivers a Form W-8BEN or W-8ECI further undertakes to deliver to
      each
      of the Company and the Administrative Agent two additional copies of such form
      (or successor form) on or before the date that such form expires or becomes
      obsolete or after the occurrence of any event requiring a change in the most
      recent form so delivered by it, and such amendments thereto or extensions or
      renewals thereof as may be reasonably requested by the Company or the
      Administrative Agent, in each case certifying that such Bank is entitled to
      receive payments under this Agreement and the Notes without deduction or
      withholding of any United States federal income taxes, unless an event
      (including without limitation any change in treaty, law or regulation) has
      occurred prior to the date on which any such delivery would otherwise be
      required which renders all such forms inapplicable or which would prevent such
      Bank from duly completing and delivering any such form with respect to it and
      such Bank advises the Company and
      the
      Administrative Agent that it is not capable of receiving payments without any
      deduction or withholding of United States federal income tax.

     

    (e) For
      any
      period with respect to which a Bank has failed to provide the Company or the
      Administrative Agent with the appropriate form as required by Section 8.05(d)
      (whether or not such Bank is lawfully able to do so, unless such failure is
      due
      to a change in treaty, law or regulation occurring subsequent to the date on
      which such form originally was required to be provided), such Bank shall not
      be
      entitled to indemnification under Section 8.05(b) or (c) with respect to any
      withholding of the United States federal income tax; provided
      that if
      a Bank, which is otherwise exempt from or subject to a reduced rate of
      withholding tax, becomes subject to Taxes because of its failure to deliver
      a
      form required hereunder, the Company shall take such steps as such Bank shall
      reasonably request to assist such Bank to recover such Taxes.

     

    (f) If
      any
      Account Party or the Guarantor is required to pay additional amounts to or
      for
      the account of any Bank pursuant to this Section as a result of a change of
      law
      occurring after the date hereof, then such Bank, at the request of the Company,
      will change the jurisdiction of its Applicable Lending Office if, in the sole
      judgment of such Bank, such change (i) will eliminate or reduce any such
      additional payment which may thereafter accrue and (ii) is not otherwise
      disadvantageous to such Bank.

     

    (g) Each
      Bank
      and the Administrative Agent shall, at the request of the Company, use
      reasonable efforts (consistent with applicable legal and regulatory
      restrictions) to file any certificate or document requested by the Company
      if
      the making of such a filing would avoid the need for or reduce the amount of
      any
      such additional amounts payable to or for the account of such Bank or the
      Administrative Agent (as the case may be) pursuant to this Section which may
      thereafter accrue and would not, in the sole judgment of such Bank or the
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    any
      confidential or proprietary information or be
      otherwise disadvantageous to such Bank or the Administrative Agent.

     

    (h) Notwithstanding
      the foregoing, nothing in this Section shall interfere with the rights of any
      Bank to conduct its fiscal or tax affairs in such manner as it deems
      fit.

     

    SECTION
      8.06. Regulation
      D Compensation

     

    .
      For so
      long as any Bank maintains reserves against "Eurocurrency liabilities" (or
      any
      other category of liabilities which includes deposits by reference to which
      the
      interest rate on Euro-Dollar Loans is determined or any category of extensions
      of credit or other assets which includes loans by a non-United States office
      of
      such Bank to United States residents), and as a result the cost to such Bank
      (or
      its Applicable
      Lending Office) of making or maintaining its Euro-Dollar Loans is increased,
      then such Bank may require the Company to pay, contemporaneously with each
      payment of interest on the Euro-Dollar Loans, additional interest on the related
      Euro-Dollar Loan of such Bank at a rate per annum up to but not exceeding the
      excess of (i) (A) the applicable LIBO Rate divided by (B) one minus
      the
      Euro-Dollar Reserve Percentage over (ii) the applicable LIBO Rate. Any Bank
      wishing to require payment of such additional interest (x) shall so notify
      the
      Company and the Administrative Agent, in which case such additional interest
      on
      the Euro-Dollar Loans of such Bank shall be payable to such Bank at the place
      indicated in such notice with respect to each Interest Period commencing at
      least three Euro-Dollar Business Days after the giving of such notice and (y)
      shall furnish to the Company at least five Euro-Dollar Business Days prior
      to
      each date on which interest is payable on the Euro-Dollar Loans an officer's
      certificate setting forth the amount to which such Bank is then entitled under
      this Section (which shall be consistent with such Bank's good faith estimate
      of
      the level at which the related reserves are maintained by it). Each such
      certificate shall be accompanied by such information as the Company may
      reasonably request as to the computation set forth therein.

     

    ARTICLE
      IX

     

    GUARANTY

     

    SECTION
      9.01. The
      Guaranty.
      The
      Company hereby unconditionally guarantees the full and punctual payment of
      the
      principal and interest on the Loans and all reimbursement obligations in respect
      of LC Disbursements and all interest thereon payable by each Subsidiary Account
      Party pursuant to this Agreement (including, without limitation, any Subsidiary
      Account Party that shall become party hereto after the date hereof pursuant
      to
      Section 10.13), and the full and punctual payment of all other amounts payable
      by each Subsidiary Account Party under this Agreement, including amounts payable
      

     

    
      
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    as
      cover
      in respect of outstanding letter of credit exposure pursuant to
      Sections 2.03(e) and 6.01. Upon failure by any Subsidiary Account Party to
      pay punctually any such amount, the Company shall forthwith on demand pay the
      amount not so paid at the place and in the manner specified in this
      Agreement.

     

    SECTION
      9.02. Guaranty
      Unconditional.
      The
      obligations of the Company hereunder shall be unconditional, absolute and
      continuing and, without limiting the generality of the foregoing, shall not
      be
      released, discharged or otherwise affected by:

     

    (i)
      any extension, renewal, settlement, compromise, waiver or release
      in respect of any obligation of any Subsidiary Account Party under this
      Agreement, by operation of law or otherwise;

     

    (ii)
      any
      modification or amendment of or supplement to this Agreement;

     

    (iii)
      any
      release, impairment, non-perfection or invalidity of any direct or indirect
      security for any obligation of any Subsidiary Account Party under this
      Agreement;

     

    (iv)
      any
      change in the corporate existence, structure or ownership of any Subsidiary
      Account Party, or any insolvency, bankruptcy, reorganization or other similar
      proceeding affecting any Subsidiary Account Party or its assets or any resulting
      release or discharge of any obligation of any Subsidiary Account Party contained
      in this Agreement;

     

    (v)
      the
      existence of any claim, set-off or other rights which the Company may have
      at
      any time against any Subsidiary Account Party, the Administrative Agent, any
      Bank or any other Person, whether in connection herewith or any unrelated
      transactions, provided
      that
      nothing herein shall prevent the assertion of any such claim by separate suit
      or
      compulsory counterclaim;

     

    (vi)
      any
      invalidity or unenforceability relating to or against any Subsidiary Account
      Party for any reason of this Agreement, or any provision of applicable law
      or
      regulation purporting to prohibit the payment by any Subsidiary Account Party
      of
      any reimbursement obligation, interest or any other amount payable by it under
      this Agreement;

     

    (vii)
      any
      other act or omission to act or delay of any kind by Subsidiary Account Party,
      the Administrative Agent, any Bank or any other Person or any other circumstance
      whatsoever which might, but for the provisions of this paragraph, constitute
      a
      legal or equitable discharge of or defense to the Company's obligations
      hereunder; or

     

    
       

      
        
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    (viii)
      any Bank and its Affiliates accepting deposits from, lending money to, or
      otherwise engaging in any kind of business with the Company, its Subsidiaries,
      the Subsidiary Account Parties or the Affiliates of any thereof.

     

    SECTION
      9.03. Discharge
      Only Upon Payment In Full; Reinstatement In Certain Circumstances
.
      The
      Company's obligations hereunder shall remain in full force and effect until
      the
      Commitments shall have terminated and all reimbursement obligations,
interest
      and all other amounts payable by the Company and each Subsidiary Account Party
      under this Agreement shall have been paid in full. If at any time any payment
      of
      reimbursement obligation, interest or any other amount payable by any Subsidiary
      Account Party under this Agreement is rescinded or must be otherwise restored
      or
      returned upon the insolvency, bankruptcy or reorganization of such Subsidiary
      Account Party or otherwise, the Company's obligations hereunder with respect
      to
      such payment shall be reinstated at such time as though such payment had been
      due but not made at such time.

     

    SECTION
      9.04. Waiver
      by the Company.
      The
      Company irrevocably waives acceptance hereof, presentment, demand, protest
      and
      any notice not provided for herein, as well as any requirement that at any
      time
      any action be taken by any Person against any Subsidiary Account Parties or
      any
      other Person.

     

    SECTION
      9.05. Subrogation.
      Upon
      making any payment with respect to the obligations of any Subsidiary Account
      Party hereunder, the Company shall be subrogated to the rights of the payee
      against such Subsidiary Account Party with respect to such payment; provided
      that the
      Company shall not enforce any payment by way of subrogation against such
      Subsidiary Account Party so long as (i) any Bank has any Commitment hereunder
      or
      (ii) any amount payable hereunder remains unpaid.

     

    ARTICLE
      X

     

    MISCELLANEOUS

     

    SECTION
      10.01. Notices.
      All
      notices, requests and other communications to any party hereunder shall be
      in
      writing (including bank wire, telex, facsimile transmission or similar writing,
      or by electronic communication, if arrangements for doing so have been approved
      by such party) and shall be given to such party: (a) in the case of any
      Account Party, at the Company's address or telex or telecopier number set forth
      on the Company's signature page hereof, (b) in the case of the Administrative
      Agent, at its address or telex or telecopier number set forth on its respective
      signature page hereof, (c) in the case of any Bank, at its address or

     

    
      
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    telex
      or
      telecopier number set forth in its Administrative Questionnaire or (d) in
      the case of any party, such other address or telex or telecopier number as
      such
      party may hereafter specify for the purpose by notice to the Administrative
      Agent and the Company. Each such notice, request or other communication shall
      be
      effective (i) if given by telex, when such telex is transmitted to the
      telex number specified in this Section and the appropriate answerback is
      received, (ii) if given by mail, 72 hours after such communication is
      deposited in the mails with first class postage prepaid, addressed as aforesaid
      and return receipt requested, (iii) if given by telecopier, when
      transmitted to the telecopier number specified in this Section or (iv) if
      given by any other means, when delivered at the relevant address specified
      by
      such party pursuant to this Section; provided
      that
      notices to the Administrative Agent under Article II or Article VIII
      shall not be effective until received.

     

    Notices
      and other communications to the Banks hereunder may be delivered or furnished
      by
      electronic communications pursuant to procedures approved by the Administrative
      Agent; provided
      that the
      foregoing shall not apply to notices pursuant to Article II unless otherwise
      agreed by the Administrative Agent and the applicable Bank. The Administrative
      Agent or the Account Parties may, in its discretion, agree to accept notices
      and
      other communications to it hereunder by electronic communications pursuant
      to
      procedures approved by it; provided
      that
      approval of such procedures may be limited to particular notices or
      communications.

     

    SECTION
      10.02. No
      Waivers.
      No
      failure or delay by the Administrative Agent or any Bank in exercising any
      right, power or privilege hereunder or under any other Credit Document shall
      operate as a waiver thereof nor shall any single or partial exercise thereof
      preclude any other or further exercise thereof or the exercise of any other
      right, power or privilege. The rights and remedies herein provided shall be
      cumulative and not exclusive of any rights or remedies provided by
      law.

     

    SECTION
      10.03. Expenses;
      Indemnification; Non-Liability of Banks.

     

    (a) The
      Company shall pay (i) all out-of-pocket expenses of the Administrative
      Agent, including reasonable fees and disbursements of special counsel for the
      Administrative Agent, in connection with the preparation of this Agreement,
      any
      waiver or consent hereunder or any amendment hereof or any Default or alleged
      Default hereunder and (ii) if an Event of Default occurs, all out-of-pocket
      expenses incurred by the Administrative Agent and each Bank, including fees
      and
      disbursements of counsel including costs allocated to in-house counsel, in
      connection with such Event of Default and collection, bankruptcy, insolvency
      and
      other enforcement proceedings resulting therefrom.

     

    (b) The
      Company agrees to indemnify the Administrative Agent, each Bank and each
      Confirming Bank, their Affiliates and the respective directors, officers,
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    "Indemnitee")
      and
      hold each Indemnitee harmless from and against any and all liabilities, losses,
      damages, costs and expenses of any kind, including, without limitation, the
      reasonable fees and disbursements of counsel and costs of settlement, which
      may
      be incurred by such Indemnitee in connection with any investigative,
      administrative or judicial proceeding (whether or not such Indemnitee shall
      be
      designated a party thereto) relating to or arising out of this Agreement or
      any
      actual or proposed use of proceeds of Loans or of the Letters of Credits;
provided
      that no
      Indemnitee shall have the right to be indemnified hereunder for its own gross
      negligence or willful misconduct as determined by a court of competent
      jurisdiction or for the breach by such Indemnitee of its obligations hereunder
      or, in the case of a Confirming Bank, under its Confirming Bank
      Agreement.

     

    SECTION
      10.04. Sharing
      of Set-Offs.
      Each
      Bank agrees that if it shall, by exercising any right of set-off or counterclaim
      or otherwise, receive payment of a proportion of the aggregate amount of
      principal and interest due with respect to any Loan made by it or reimbursement
      obligation or interest due with respect to any LC Disbursement made by it under
      a Letter of Credit which is greater than the proportion received by any other
      Bank in respect of the aggregate amount of principal and interest due with
      respect to any Loan made by such other Bank or reimbursement obligation or
      interest due, as the case may be, with respect to any LC Disbursement made
      by
      such other Bank under such Letter of Credit, the Bank receiving such
      proportionately greater payment shall purchase such participations in the Loans
      held by or the LC Exposure by the other Banks under such Letter of Credit,
      as
      applicable, and such other adjustments shall be made, as may be required so
      that
      all such payments of principal and interest with respect to the Loans and
      reimbursement obligations and interest with respect to LC Disbursements made
      by
      the Banks under such Letter of Credit shall be shared by the Banks pro rata;
      provided
      that
      nothing in this Section shall impair the right of any Bank to exercise any
      right
      of set-off or counterclaim it may have and to apply the amount subject to such
      exercise to the payment of indebtedness of the applicable Account Party other
      than its indebtedness under this Agreement. Each Account Party agrees, to the
      fullest extent it may effectively do so under applicable law, that any holder
      of
      a participation in any Loan or LC Exposure, whether or not acquired pursuant
      to
      the foregoing arrangements, may exercise rights of set-off or counterclaim
      and
      other rights with respect to such participation as fully as if such holder
      of a
      participation were a direct creditor of such Account Party in the amount of
      such
      participation.

     

    SECTION
      10.05. Amendments
      and Waivers.
      Any
      provision of this Agreement may be amended or waived if, but only if, such
      amendment or waiver is in writing and is signed by each Account Party and the
      Required Banks or by the Administrative Agent (with the consent of the Required
      Banks) (and, if the rights or duties of the Administrative Agent or any Fronting
      Issuing Bank, in such capacity, are affected thereby, by the Administrative
      Agent or any Fronting Issuing Bank, as the case may be); provided
      that the
      Administrative Agent may, 

     

    
      
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    with
      the
      consent of the Company (which shall not be unreasonably withheld), specify
      by
      notice to the Banks modifications in the procedures set forth in Section
      2.01(b); provided,
      further,
      that
      the consent of each Bank affected thereby shall be required with respect to
      any
      amendment, waiver or modification that (i) increases the amount or extends
      the expiry date of the Commitment of any Bank, increases the LC Exposure of
      such
      Bank or otherwise subjects any Bank to any additional obligation,
      (ii) reduces the principal amount of any Loan or the amount of any
      reimbursement obligation of any Account Party in respect of any LC Disbursement,
      the rate or amount of interest thereon or any fees payable to such Bank
      hereunder, (iii) postpones the scheduled date of payment of the principal
      amount of any Loan or for reimbursement of any LC Disbursement, or any interest
      thereon, or any fees payable hereunder, or waives or excuses any such payment,
      or postpones the scheduled date of expiration of any Commitment, or
      (iv) alters the manner in which reimbursement payments, payments or
      prepayments of principal, interest or payment of other amounts hereunder shall
      be applied as among the Banks; provided,
      further,
      that
      the consent of 100% of the Banks shall be required with respect to (x) any
      change in the percentage of the Commitments or of the Credit Exposure, or the
      number of Banks, which shall be required for the Banks or any of them to take
      any action under this Section or any other provision of this Agreement,
      (y) the release of any of the collateral provided for cover of the LC
      Exposure pursuant to Sections 2.03(e) and 6.01 other than as expressly provided
      in Section 2.03(e) or (z) any change in the obligations of the Company
      under Article IX. 

     

    SECTION
      10.06. Successors
      and Assigns.

     

    (a) The
      provisions of this Agreement shall be binding upon and inure to the benefit
      of
      the parties hereto and their respective successors and assigns; provided,
      however,
      that no
      Account Party may assign or otherwise transfer any of its rights or obligations
      under this Agreement, without the prior written consent of the
      Banks.

     

    (b) Any
      Bank
      may at any time grant to one or more banks or other institutions (each a
      "Participant")
      participating interests in its Commitment or the Loans or any or all of its
      Letters of Credit. In the event of any such grant by a Bank of a participating
      interest to a Participant, whether or not upon notice to the Company and the
      Administrative Agent, such Bank shall remain solely responsible for the
      performance of its obligations hereunder, and the Account Parties and the
      Administrative Agent shall continue to deal solely and directly with such Bank
      in connection with such Bank's rights and obligations under this Agreement.
      Any
      agreement pursuant to which any Bank may grant such a participating interest
      shall provide that such Bank shall retain the sole right and responsibility
      to
      enforce the obligations of the Account Parties hereunder including, without
      limitation, the right to approve any amendment, modification or waiver of any
      provision of this Agreement; provided
      that
      such participation agreement may provide that such Bank will not agree to any
      modification, 

     

    
      
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    amendment
      or waiver of this Agreement described in clause (i), (ii), (iii), (iv),
      (x), (y) or (z) of Section 10.05 without the consent of the Participant.
      Each Account Party agrees that each Participant shall, to the extent provided
      in
      its participation agreement, be entitled to the benefits of Article VIII
      with respect to its participating interest. An assignment or other transfer
      which is not permitted by subsection (c) or (d) below shall be given effect
      for purposes of this Agreement only to the extent of a participating interest
      granted in accordance with this subsection (b).

     

    (c) Any
      Bank
      may at any time assign to one or more NAIC Approved Banks (each an "Assignee")
      all,
      or a proportionate part of all, of its rights and obligations under this
      Agreement, and such Assignee shall assume such rights and obligations, pursuant
      to an Assignment and Assumption executed by such Assignee and such transferor
      Bank, with (and subject to) the consent of the Company, which shall not be
      unreasonably withheld, and the Administrative Agent, which shall not be
      unreasonably withheld; provided
      that (i)
      if an Assignee is an Affiliate of any Bank or was a Bank immediately prior
      to
      such assignment, no such consent of the Company shall be required and (ii)
      if an
      Assignee was a Bank immediately prior to such assignment, no such consent of
      the
      Administrative Agent shall be required; provided,
      further,
      that if
      an Event of Default occurs and is continuing under Section 6.01(a), 6.01(g)
      or
      6.01(h) with respect to the Company, no such consent of the Company shall be
      required; and provided,
      further,
      that
      any such assignment (other than an assignment to another Bank or an Affiliate
      of
      any Bank or an assignment of the entire remaining amount of the transferor
      Bank's Commitment and interests in outstanding Loans and Letters of Credit)
      shall be in an amount that is at least $5,000,000 unless otherwise agreed by
      the
      Account Parties and the Administrative Agent. Upon execution and delivery of
      such Assignment and Assumption and payment by such Assignee to such transferor
      Bank of an amount equal to the purchase price agreed between such transferor
      Bank and such Assignee, such Assignee shall be a Bank party to this Agreement
      and shall have all the rights and obligations of a Bank with a Commitment as
      set
      forth in such instrument of assumption, and the transferor Bank shall be
      released from its obligations hereunder to a corresponding extent, and no
      further consent or action by any party shall be required. In connection with
      any
      such assignment, the transferor Bank or Assignee shall pay to the Administrative
      Agent an administrative fee for processing such assignment in the amount of
      $3,500. If the Assignee is not incorporated under the laws of the United States
      of America or a state thereof, it shall, prior to the first date on which
      interest or fees are payable hereunder for its account, deliver to the Company
      and the Administrative Agent certification as to exemption from deduction or
      withholding of any United States federal income taxes in accordance with
      Section 8.05(d).

     

    
      (d) Any
        Bank
        may at any time assign all or any portion of its rights under this Agreement
        to
        any Person to secure obligations of such Bank, including, without limitation,
        to
        one or more of the Federal Reserve Banks which 

    

    
      
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    comprise
      the Federal Reserve System. No such
      assignment shall release the transferor Bank from its obligations
      hereunder.

     

    (e) No
      Assignee, Participant or other transferee of any Bank's rights shall be entitled
      to receive any greater payment under Sections 8.03, 8.05 or 8.06 than such
      Bank would have been entitled to receive with respect to the rights transferred,
      unless such transfer is made (i) with the Company's prior written consent
      or by reason of the provisions of Section 8.02, 8.03 or 8.05 requiring such
      Bank to designate a different Applicable Lending Office under certain
      circumstances or (ii) at a time when the circumstances giving rise to such
      greater payment did not exist.

     

    SECTION
      10.07. Collateral.
      Each of
      the Banks represents to the Administrative Agent and each of the other Banks
      that it in good faith is not relying upon any "margin stock" (as defined in
      Regulation U) as collateral in the extension or maintenance of the credit
      provided for in this Agreement.

     

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

     

    SECTION
      10.09. Judicial
      Proceedings.

     

    (a) Submission
      to Jurisdiction.
      Each
      Account Party hereby submits to the nonexclusive jurisdiction of the United
      States District Court for the Southern District of New York and of any New
      York
      State court sitting in New York City for purposes of all legal proceedings
      arising out of or relating to this Agreement or any other Credit Document or
      the
      transactions contemplated hereby. Each Account Party irrevocably waives, to
      the
      fullest extent permitted by law, any objection which it may now or hereafter
      have to the laying of the venue of any such proceeding brought in such a court
      and any claim that any such proceeding brought in such a court has been brought
      in an inconvenient forum.

     

    (b) Appointment
      of Agent for Service of Process.
      Each
      Subsidiary Account Party irrevocably designates and appoints the Company, and
      the Company hereby accepts such appointment, at its office in Philadelphia,
      Pennsylvania set forth beneath the Company's signature on the signature page
      hereof, as the authorized agent of such Subsidiary Account Party, to accept
      and
      acknowledge on its behalf, service of any and all process which may be served
      in
any
      suit, action or proceeding of the nature referred to in Section 10.09(a)
      above in any federal or New York State court sitting in New York City. Said
      designation and appointment shall be irrevocable by each Subsidiary Account
      Party until all reimbursement obligations, interest thereon and all other
      amounts payable hereunder shall have been paid in full in accordance with the
      provisions hereof and thereof or, if earlier, when such Subsidiary Account
      Party
      is terminated as an Account Party hereunder pursuant to
      Section 10.13.

     

    
      
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    (c) Service
      of Process.
      Each
      Account Party hereby consents to process being served in any suit, action or
      proceeding of the nature referred to in subsection (a) above in any federal
      or New York State court sitting in New York City by service of process upon
      its
      agent appointed as provided in subsection (b) above; provided
      that, to
      the extent lawful and possible, notice of said service upon such agent shall
      be
      mailed by registered or certified air mail, postage prepaid, return receipt
      requested, to such Account Party at its address specified on the signature
      page
      hereof (or, in the case of any Subsidiary Account Party, on the signature page
      of the Subsidiary Joinder Agreement to which it is a party) or to any other
      address of which such Account Party shall have given written notice to the
      applicable Bank. Each Account Party irrevocably waives, to the fullest extent
      permitted by law, all claim of error by reason of any such service in such
      manner and agrees that such service shall be deemed in every respect effective
      service of process upon such Account Party in any such suit, action or
      proceeding and shall, to the fullest extent permitted by law, be taken and
      held
      to be valid and personal service upon and personal delivery to such Account
      Party.

     

    (d) No
      Limitation on Service or Suit.
      Nothing
      in this Section shall affect the right of the Administrative Agent or any Bank
      to serve process in any other manner permitted by law or limit the right of
      the
      Administrative Agent or any Bank to bring proceedings against any Account Party
      in the courts of any jurisdiction or jurisdictions.

     

    SECTION
      10.10. Counterparts;
      Integration.
      This
      Agreement may be signed in any number of counterparts, each of which shall
      be an
      original, with the same effect as if the signatures thereto and hereto were
      upon
      the same instrument. This Agreement constitutes the entire agreement and
      understanding among the parties hereto and supersedes any and all prior
      agreements and understandings, oral or written, relating to the subject matter
      hereof.

     

    SECTION
      10.11. Confidentiality.
      The
      Administrative Agent and each Bank agree that they will maintain the
      confidentiality of, and will not use for any purpose (other than exercising
      its
      rights and enforcing its remedies hereunder and under the other Credit
      Documents), any written
      or oral information provided under this Agreement by or on behalf of the Account
      Parties (hereinafter collectively called "Confidential
      Information"),
      subject to the Administrative Agent's and each Bank's (a) obligation to
      disclose any such Confidential Information pursuant to a request or order under
      applicable laws and regulations or pursuant to a subpoena or other legal
      process, (b) right to disclose any such Confidential Information to its
      bank examiners, auditors, counsel and other professional advisors and to other
      Banks and to its subsidiaries and Affiliates and the subsidiaries and Affiliates
      of its holding company, provided
      that the
      Administrative Agent or such Bank, as the case may be, shall cause each such
      subsidiary or Affiliate to maintain the Confidential Information on the same
      terms as the terms provided herein, (c) right to disclose any such
      Confidential Information in connection with any litigation or dispute involving
      the Banks and 

     

    
       

      
        
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    the
      Company or any of its Subsidiaries and Affiliates and (d) right to provide
      such information to participants, prospective participants or prospective
      assignees pursuant to Section 10.06 or to its prospective Confirming Bank
      or Confirming Bank if prior thereto such participant, prospective participant,
      prospective assignee, prospective Confirming Bank or Confirming Bank agrees
      in
      writing to maintain the confidentiality of such information on terms
      substantially similar to those of this Section as if it were a "Bank" party
      hereto. Notwithstanding the foregoing, any such information supplied to a Bank,
      participant, prospective participant, prospective assignee, prospective
      Confirming Bank or Confirming Bank under this Agreement shall cease to be
      Confidential Information if it is or becomes known to such Person by other
      than
      unauthorized disclosure, or if it is, at the time of disclosure, or becomes
      a
      matter of public knowledge.

     

    SECTION
      10.12. WAIVER
      OF JURY TRIAL.
      EACH OF
      THE ACCOUNT PARTIES, THE ADMINISTRATIVE AGENT AND THE BANKS HEREBY IRREVOCABLY
      WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT
      OF
      OR RELATING TO THIS AGREEMENT, THE NOTES OR THE TRANSACTIONS CONTEMPLATED
      HEREBY.

     

    SECTION
      10.13. Joinder
      and Termination of Subsidiary Account Party.
      

     

    (a) Any
      direct or indirect wholly-owned Subsidiary of the Company that is organized,
      licensed or regulated under applicable law as an insurance or reinsurance
      company may, with the consent of the Company, become a party to this Agreement
      as an Account Party by delivering an executed Subsidiary Joinder Agreement,
      substantially in the form of Exhibit F hereto, to the Administrative Agent
      for
      acceptance by it (which shall promptly notify the Banks), provided
      that on
      and as of the date of acceptance of such Subsidiary Joinder Agreement by the
      Administrative Agent (i) no Default shall have occurred and be continuing,
      (ii) each of the representations and warranties contained in this Agreement
      (other than the representations and warranties set forth in Sections 4.04(e)
      and
      4.05 as to any matter which has theretofore been disclosed in writing by the
      Account Parties to the Banks) shall be true with the same force and effect
      as if
      made on and as of such date (or, if any such representation or warranty is
      expressly stated to have been made as of a specific date, as of such specific
      date), (iii) such Subsidiary Account Party shall be deemed to have appointed
      the
      Company as its authorized agent pursuant to Section 10.09(b) to accept service
      of any and all process which may be served in any suit, action or proceeding
      of
      any nature in any federal or New York State court sitting in New York City
      arising out of or relating to this Agreement or any other Credit Document or
      the
      transactions contemplated hereby and (iv) such other documents as the
      Administrative Agent shall reasonably request, which may include opinions of
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     conditions
      set forth in Section 3.02, each in form and substance satisfactory to the
      Administrative Agent.

     

    (b) The
      Company may, at any time at which a Subsidiary Account Party shall not be an
      Account Party with respect to an outstanding Letter of Credit and which shall
      have no unpaid LC Disbursements or unpaid interest on any LC Disbursements,
      terminate such Subsidiary Account Party as an Account Party hereunder by
      delivering an executed notice thereof, substantially in the form of Exhibit
      G
      hereto, to the Administrative Agent (which shall promptly notify the Banks).
      Immediately upon the receipt by the Administrative Agent of such notice, all
      commitments of the Banks to issue Letters of Credit for the account of such
      Subsidiary Account Party and all rights of such Subsidiary Account Party
      hereunder, shall terminate and such Subsidiary Account Party shall immediately
      cease to be an Account Party hereunder; provided
      that all
      obligations of such Subsidiary Account Party as an Account Party hereunder
      arising in respect of any period in which such Subsidiary Account Party was,
      or
      on account of any action or inaction by such Subsidiary Account Party as, an
      Account Party hereunder shall survive such termination.

     

    SECTION
      10.14. USA
      PATRIOT Act.
      Each
      Bank hereby notifies the Account Parties that pursuant to the requirements
      of
      the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October
      26, 2001)), such Bank may be required to obtain, verify and record
      information that identifies the Account Parties, which information includes
      the
      name and address of the Account Parties and other information that will allow
      such Bank to identify the Account Parties in accordance with said
      Act.

     

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

     

    LINCOLN
      NATIONAL CORPORATION

    

    

    By:
      /s/ Frederick J. Crawford

    Name:
      Frederick J. Crawford

    Title:
      SVP & Chief Financial Officer

    

    

    By:
      /s/ James E. Cruickshank

    Name:
      James E. Cruickshank

       
                    Title:
      2nd Vice President and Assistant Treasurer

    

    U.S.
      Federal Tax Identification No.: 35-1140070

     

    

    Centre
      Square, West Tower

    1500
      Market Street, Suite 3900

    Philadelphia,
      PA 19102-2112

    Attention:
      Treasurer's Office

    Tel: (215)
      448-1435

    Fax: (215)
      448-3954

    
      
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    SUBSIDIARY
      ACCOUNT PARTIES

    

    LINCOLN
      NATIONAL REINSURANCE

    COMPANY
      (BARBADOS) LIMITED

    

    

    By:
      /s/ James E. Cruickshank

    Name:
      James E. Cruickshank

    Title:
      Treasurer

    

    U.S.
      Federal Tax Identification No.: 35-1716060

     

    

    THE
      LINCOLN NATIONAL LIFE INSURANCE 

    COMPANY

    

    

    By:
      /s/ Douglas N. Miller

    Name:
      Douglas N. Miller

    Title:
      Senior Vice President

    

    U.S.
      Federal Tax Identification No.: 35-0472300

     

    

    LFG
      SOUTH
      CAROLINA REINSURANCE COMPANY

    

    

    By: 
      /s/ James E. Cruickshank

    Name:
      James E. Cruickshank

    Title:
      Treasurer

    

    U.S.
      Federal Tax Identification No.: 20-3743123

     

    
      
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    LINCOLN
      REINSURANCE COMPANY OF BERMUDA, LIMITED

    

    

    By:
      /s/ Frederick J. Crawford

    Name:
      Frederick J. Crawford

    Title:
      President

    

    
      
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    BANKS

    

    JPMORGAN
      CHASE BANK, N.A.,

    
      	 	 	
              individually
                and as Administrative Agent

            

    

    

    

    By:
      /s/ Heather Lindstrom

    Name:
      Heather Lindstrom

    Title:
      Vice President

    

    Address
      for Notices (for the Administrative Agent):

    

    JPMorgan
      Chase Bank, N.A.

    1111
      Fannin Street

    10th
      Floor

    Houston,
      Texas 77002-8069

    Attention:
      Loan and Agency Services

    Tel: (713)
      750-3560

    Fax: (713)
      750-2223

    

    with
      a
      copy to:

    

    JPMorgan
      Chase Bank, N.A.

    270
      Park
      Avenue

    22nd
      Floor

    New
      York,
      NY 10017

    Attention:
      Heather Lindstrom

    Tel: (212)
      270-9839

    Fax: (212)
      270-1511

    

    

    
      
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    BANK
      OF
      AMERICA, N.A. 

    

    

    By:
      /s/ Jamison L. Fox

    Name:
      Jamison L. Fox

    Title:
      Vice President

    
      
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    THE
      BANK
      OF NEW YORK

    

    

    

    By:
      /s/ Richard G. Shaw

    Name:
      Richard G. Shaw

    Title:
      Vice President

    
      
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    CITIBANK,
      N.A.

    

    

    

    By:
      /s/ Peter C. Bickford

    Name:
      Peter C. Bickford

    Title:
      Vice President Citibank N.A./Managing Director

    
      
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    LEHMAN
      BROTHERS BANK, FSB

    

    

    

    By:
      /s/ Gary T. Taylor

    Name:
      Gary T. Taylor

    Title:
      Senior Vice President

    
      
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    MERRILL
      LYNCH BANK USA

    

    

    

    By:
      /s/ Louis Alder

    Name:
      Louis Alder

    Title:
      Director

    
      
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          Agreement

        
        

      

      
        
        

        
          

        

      

      
        
        

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    MORGAN
      STANLEY BANK

    

    

    

    By:
      /s/ Eugene E. Martin

    Name:
      Eugene E. Martin

    Title:
      Vice President, Morgan Stanley Bank

    
      
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    UBS
      AG,
      STAMFORD BRANCH

    

    

    

    By:
      /s/ Richard L. Tavrow

    Name:
      Richard L. Tavrow

    Title:
      Director

     

     

    
      By:
        /s/ Irja R. Otsa

      Name:
        Irja R. Otsa

      Title:
        Associate Director

    

    
      
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    WACHOVIA
      BANK, NATIONAL ASSOCATION

    

    

    

    By:
      /s/ Joan Anderson

    Name:
      Joan Anderson

    Title:
      Director

    
      
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          Agreement

        
        

      

      
        
        

        
          

        

      

      
        
        

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    WILLIAM
      STREET CREDIT CORPORATION

    

    

    

    By:
      /s/ Mark Walton

    Name:
      Mark Walton

    Title:
      Assistant Vice President

    

    

     

    
      
        
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            Agreement

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
           

           

        

      

    

    SCHEDULE
      I

    

    Commitments

    

    

    

      
        	
                Banks

              	
                Commitment
                  ($)

              
	 	 
	
                JPMorgan
                  Chase Bank, N.A. 

              	
                100,000,000

              
	
                Bank
                  of America, N.A.

              	
                100,000,000

              
	
                The
                  Bank of New York

              	
                100,000,000

              
	
                Citibank,
                  N.A.

              	
                100,000,000

              
	
                Lehman
                  Brothers Bank, FSB

              	
                100,000,000

              
	
                Merrill
                  Lynch Bank USA

              	
                100,000,000

              
	
                Morgan
                  Stanley Bank

              	
                100,000,000

              
	
                UBS
                  AG, Stamford Branch

              	
                100,000,000

              
	
                Wachovia
                  Bank, National Association

              	
                100,000,000

              
	
                William
                  Street Credit Corporation

              	
                100,000,000

              
	
                TOTAL
                  COMMITMENTS

                 

              	
                $1,000,000,000

                 

              

      

    

    

    

    
      
        
          Schedule
            I (Commitments)

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
           

           

        

      

    

    SCHEDULE
      II

     

    List
      of Restricted Subsidiaries

     

    Lincoln
      National Life Insurance Company

     

    

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    
      Schedule
        II (Restricted Subsidiaries)EXHIBIT 10.1

                                                               Execution Version

                            STOCK PURCHASE AGREEMENT

                                 by and between

                               STEVEN MADDEN, LTD.

                                       and

                              The Sole Shareholder

                                       of

                      DANIEL M. FRIEDMAN & ASSOCIATES, INC.

                                       and

                             DMF INTERNATIONAL, LTD.

                          Dated as of February 7, 2006
<PAGE>

                                TABLE OF CONTENTS

                                                                          Page

ARTICLE I      Certain Definitions...........................................1

ARTICLE II     Purchase and Sale.............................................7
      2.1      Purchase and Sale of Company Shares...........................7
      2.2      Cash Purchase Price...........................................7
      2.3      Post-Closing Adjustment.......................................8

ARTICLE III    Closing......................................................10
      3.1      Closing Date.................................................10
      3.2      Certain Actions at Closing...................................10

ARTICLE IV     Representations and Warranties of Seller.....................10
      4.1      Organization and Good Standing...............................10
      4.2      Capitalization...............................................11
      4.3      Authorization................................................11
      4.4      No Conflicts; Consents.......................................12
      4.5      Financial Statements; Undisclosed Liabilities; Promotions
               and Allowances; Inventory....................................12
      4.6      Taxes........................................................13
      4.7      Real and Personal Property...................................14
      4.8      Intellectual Property........................................15
      4.9      Contracts and Agreements.....................................17
      4.10     Insurance....................................................20
      4.11     Litigation...................................................20
      4.12     Condition and Sufficiency of Assets..........................20
      4.13     Compliance with Law; Licenses; Customs.......................20
      4.14     Employees....................................................22
      4.15     Employee Benefit Plans.......................................23
      4.16     Environmental Matters........................................27
      4.17     Bank Accounts and Powers of Attorney.........................27
      4.18     Absence of Certain Changes...................................27
      4.19     Books and Records............................................30
      4.20     Transactions with Affiliated Persons.........................30
      4.21     Customer and Supplier Relationships..........................30
      4.22     Absence of Certain Business Practices........................31
      4.23     Brokers and Finders..........................................31
      4.24     Restrictions on Business Activities..........................31
      4.25     Payables.....................................................31
      4.26     Receivables..................................................31
      4.27     Business Relations...........................................32
      4.28     Disclosure...................................................32

                                        i
<PAGE>

                                                                          Page

ARTICLE V      Representations and Warranties of Madden.....................32
      5.1      Organization and Good Standing...............................32
      5.2      Authorization................................................32
      5.3      No Conflicts; Consents.......................................32
      5.4      Litigation...................................................33
      5.5      Brokers and Finders..........................................33
      5.6      Investment Intent............................................33

ARTICLE VI     Covenants of Seller..........................................33
      6.1      Ordinary Course..............................................33
      6.2      Conduct of Business..........................................33
      6.3      Certain Filings..............................................36
      6.4      Consents and Approvals.......................................36
      6.5      Efforts to Satisfy Conditions................................36
      6.6      Further Assurances...........................................36
      6.7      Notification of Certain Matters..............................36

ARTICLE VII    Covenants of Madden..........................................37
      7.1      Certain Filings..............................................37
      7.2      Efforts to Satisfy Conditions................................37
      7.3      Further Assurances...........................................37
      7.4      Notification of Certain Matters..............................37
      7.5      Indemnification .............................................38

ARTICLE VIII   Certain Other Agreements.....................................38
      8.1      Certain Tax Matters..........................................38

ARTICLE IX     Conditions Precedent to Obligations of Madden................41
      9.1      Representations and Warranties...............................41
      9.2      Compliance with Covenants....................................41
      9.3      Lack of Adverse Change.......................................41
      9.4      Update Certificate...........................................41
      9.5      Legal Opinion................................................42
      9.6      Regulatory Approvals.........................................42
      9.7      Consents of Third Parties....................................42
      9.8      No Violation of Orders.......................................42
      9.9      Employment Agreements........................................42
      9.10     Transaction Documents........................................42
      9.11     License Agreement............................................42
      9.12     Other Closing Matters........................................42

ARTICLE X      Conditions Precedent to Obligations of Seller................43
      10.1     Representations and Warranties...............................43
      10.2     Compliance with Covenants....................................43
      10.3     Update Certificate...........................................43
      10.4     Regulatory Approvals.........................................43
      10.5     No Violation of Orders.......................................43

                                       ii
<PAGE>

                                                                          Page

      10.6     Transaction Documents........................................43
      10.7     Legal Opinion................................................43
      10.8     License Agreement............................................43
      10.9     Other Closing Matters........................................43

ARTICLE XI     Termination of Agreement.....................................44
      11.1     Conditions for Termination...................................44
      11.2     Effect of Termination........................................44

ARTICLE XII    Indemnification..............................................44
      12.1     Survival of Representations, Warranties and Covenants........44
      12.2     Indemnification by Seller....................................45
      12.3     Indemnification by Madden....................................46
      12.4     Assumption of Defense........................................46
      12.5     Non-Assumption of Defense....................................47
      12.6     Indemnified Party's Cooperation as to Proceedings............47
      12.7     Payments Treated as Purchase Price Adjustment................48

ARTICLE XIII   Miscellaneous................................................48
      13.1     Expenses.....................................................48
      13.2     Entirety of Agreement........................................48
      13.3     Notices......................................................48
      13.4     Amendment....................................................48
      13.5     Waiver.......................................................49
      13.6     Counterparts; Facsimile......................................49
      13.7     Assignment; Binding Nature; No Beneficiaries.................49
      13.8     Headings.....................................................49
      13.9     Governing Law; Jurisdiction..................................49
      13.10    Construction.................................................49
      13.11    Negotiated Agreement.........................................50
      13.12    Public Announcements.........................................50
      13.13    Remedies Cumulative..........................................50
      13.14    Severability.................................................50
      13.15    WAIVER OF JURY TRIAL.........................................50
      13.16    Right of Set-Off.............................................51

                                      iii
<PAGE>

                            STOCK PURCHASE AGREEMENT

     THIS STOCK PURCHASE AGREEMENT (this "Agreement"), dated as of February 7,
2006, is by and between Steven Madden, Ltd., a Delaware corporation ("Madden"),
on the one hand, and Daniel M. Friedman ("Seller"), on the other hand.

                                    RECITALS
                                    --------

     WHEREAS, Seller owns all of the issued and outstanding shares of capital
stock of the corporations listed on Schedule A attached hereto (collectively,
the "Companies" and individually, a "Company"); and

     WHEREAS, Madden desires to acquire all of the issued and outstanding shares
of capital stock of each of the Companies, and Seller desires to sell the same,
on the terms and conditions contained herein and in the Earn-Out Agreement (as
defined below).

     NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements hereinafter set forth, the parties hereto, intending to be
legally bound, hereby agree as follows:

                                    ARTICLE I

                               Certain Definitions
                               -------------------

     "Adjustment Payment Date" means a date which is within three (3) Business
Days after the Final Closing Date Balance Sheet is final, binding and
conclusive.

     "Affiliate Loans" means loans made to Affiliated Persons by either of the
Companies.

     "Affiliated Person" means Seller, any Immediate Family Member of Seller, or
any other Person (other than either of the Companies) that, directly or
indirectly, alone or together with others, controls, is controlled by or is
under common control with either of the Companies, Seller or any Immediate
Family Member of Seller.

     "Agreement" has the meaning set forth in the preamble.

     "Balance Sheet" means the unaudited combined balance sheet of the Companies
as of December 31, 2005.

     "Business Day" means any day that is not a Saturday or Sunday or a legal
holiday on which banks are authorized or required by law to be closed in New
York, New York or Hong Kong, China.

     "Cash-On-Hand" means all cash or cash equivalents held by the Companies.

     "Cash Purchase Price" has the meaning set forth in Section 2.2(a).

<PAGE>

     "Closing" has the meaning set forth in Section 3.1.

     "Closing Date" has the meaning set forth in Section 3.1.

     "Closing Date Balance Sheet" means the balance sheet of the Companies as of
the close of business on the Closing Date.

     "Closing Date Net Working Capital" has the meaning set forth in Section
2.3(a)(i).

     "Closing Purchase Price" means the Cash Purchase Price minus the Holdback
Amount.

     "COBRA" has the meaning set forth in Section 4.15(b).

     "Code" means the U.S. Internal Revenue Code of 1986, as amended.

     "Companies" has the meaning set forth in the recitals.

     "Company IP Rights" has the meaning set forth in Section 4.8(a).

     "Company IP Rights Agreements" has the meaning set forth in Section 4.8(b).

     "Company Products" means all products sold, designed, marketed, licensed
and/or distributed (whether at wholesale or retail) by either of the Companies.

     "Company Shares" has the meaning set forth in Section 2.1.

     "Confidentiality Agreement" means that certain Confidentiality Agreement,
dated October 21, 2005, between Wechsler & Cohen, LLP and Madden.

     "Contracts" has the meaning set forth in Section 4.9(a).

     "Debt" means the aggregate amounts of long term and short term debt of the
Companies, including, without limitation, any amounts outstanding or owing under
capital leases, notes payable to financial institutions, lines of credit, notes
or dividends payable, amounts due to Seller, any other notes payable, and any
prepayment penalties or expenses associated with the foregoing.

     "Disclosure Schedule" means the disclosure schedules of Seller accompanying
this Agreement.

     "Dispute Notice" has the meaning set forth in Section 2.3(a)(ii).

     "DMFA" means Daniel M. Friedman & Associates, Inc., a New York corporation.

     "Earn-Out Agreement" means the Earn-out Agreement among each of the
Companies, Seller and Madden, which has been executed and delivered prior to or

                                      -2-
<PAGE>

simultaneously with the execution and delivery of this Agreement and which shall
become effective as of the Closing, attached hereto as Exhibit A.

     "Earn-Out Payment" has the meaning set forth in Section 2.2.

     "Employee Benefit Plan" has the meaning set forth in Section 4.15(a).

     "Employment Agreements" means the employment agreements between DMFA and
each of Seller, KH, SL and RC, which have been executed and delivered prior to
or simultaneously with the execution and delivery of this Agreement and which
shall become effective as of the Closing, attached hereto as Exhibit B, Exhibit
C, Exhibit D and Exhibit E, respectively.

     "Encumbrance" means any lien, pledge, mortgage, security interest, charge,
restriction, adverse claim or other encumbrance of any kind or nature
whatsoever.

     "Environment" means soil, surface water, ground water, land, stream
sediments, surface or subsurface strata, ambient air and any environmental
medium.

     "Environmental Law" means any Law of the U.S. or any State or local U.S.
government that governs protection or improvement of human health or the
Environment.

     "Environmental Permit" means any permit, registration, certificate,
certification, license, authorization, consent or approval of any Governmental
Body required or issued under Environmental Laws.

     "ERISA" has the meaning set forth in Section 4.15(a).

     "ERISA Affiliate" has the meaning set forth in Section 4.15(a).

     "Final Allocation" has the meaning set forth in Section 8.1(b)(ii).

     "Final Closing Date Balance Sheet" has the meaning set forth in Section
2.3(a)(iii).

     "Financial Statements" means the unaudited combined balance sheets and
statements of earnings, shareholders' equity and cash flows of the Companies as
of, and for each of the fiscal years ended, December 31, 2005, 2004, 2003 and
2002, respectively.

     "GAAP" means U.S. generally accepted accounting principles, as in effect on
the date of this Agreement, consistently applied.

     "Governmental Body" means any governmental or regulatory body, agency,
authority, commission, department, bureau, court, tribunal, arbitrator or
arbitral body (public or private), or political subdivision, in any
jurisdiction.

     "Hazardous Materials" means (a) any element, compound, gas or chemical that
is defined, listed, classified or regulated as hazardous or toxic under any
Environmental Law, including, without limitation, any material or substance that

                                      -3-
<PAGE>

is defined as a "hazardous waste," "hazardous material," "hazardous substance,"
"extremely hazardous waste," "restricted hazardous waste," "subject waste,"
"contaminant," "toxic waste," "toxic substance" or similar term under any
provision of any Environmental Law; (b) petroleum, petroleum-based or
petroleum-derived products; and (c) any substance containing polychlorinated
biphenyls, asbestos, lead, urea formaldehyde or radon gas.

     "HIPPA" has the meaning set forth in Section 4.15(b).

     "Holdback Amount" has the meaning set forth in Section 2.2(a).

     "Immediate Family Member", with respect to any Person who is an individual,
means each of such Person's spouse, children (whether by blood or adoption),
parents and siblings.

     "Indemnification Obligations" means the respective indemnification
obligations of Seller or Madden under Article XII.

     "Independent Accounting Firm" means an independent accounting firm mutually
acceptable to Madden and Seller (which accounting firm has not, within the prior
twenty-four (24) months, provided services to Madden, Seller or either of the
Companies, or any affiliate of any of them). If Madden and Seller are unable to
agree upon an independent accounting firm within thirty (30) days after Seller's
delivery of a Dispute Notice to Madden, an independent accounting firm selected
by Madden (which accounting firm has not, within the prior twenty-four (24)
months, provided services to Madden or either of the Companies, or any affiliate
of any of them) and an independent accounting firm selected by Seller (which
accounting firm has not, within the prior twenty-four (24) months, provided
services to Seller or either of the Companies, or any affiliate of any of them)
shall select an independent accounting firm (which accounting firm has not,
within the prior twenty-four (24) months, provided services to Madden, Seller or
either of the Companies, or any affiliate of any of them) and such independent
accounting firm shall be the Independent Accounting Firm.

     "Intellectual Property Rights" means all intellectual property rights,
including trademarks, service marks, internet domain names, slogans, logos,
trade names, and the goodwill associated therewith, patents, copyrights, in both
published and unpublished works, and all registrations and applications for any
of the foregoing, rights of publicity/privacy, franchises, licenses, proprietary
know-how, proprietary trade secrets, proprietary customer lists, proprietary
vendor lists, proprietary information, proprietary processes, proprietary
formulae, proprietary computer programs and applications, proprietary layouts,
proprietary specifications, proprietary designs, proprietary patterns,
proprietary inventions, proprietary development tools and all documentation and
media constituting, describing or relating to the above, including manuals,
memoranda and records wherever created throughout the world.

     "IRS" means the U.S. Internal Revenue Service.

     "KH" means Kenneth Horowitz.

                                      -4-
<PAGE>

     "Knowledge" means the knowledge, at any time, of: in the case of Seller and
each of the Companies, Seller, KH, SL and RC; and in the case of Madden,
Jamieson A. Karson, Awadhesh Sinha and Ed Rosenfeld.

     "Law" means any law (including common law), statute, code, ordinance, rule,
regulation, permit, order, decree or other requirement or guideline in any
jurisdiction.

     "License Agreement" means that certain License Agreement, dated as of July
14, 2005, between Madden and Daniel M. Friedman & Associates, Inc.

     "Licenses" has the meaning set forth in Section 4.13(b).

     "Loss", in respect of any matter, means any loss, liability, cost, expense,
judgment, settlement or damage arising as a result of such matter, including
reasonable attorneys', consultants' and other advisors' fees and expenses,
reasonable costs of investigating or defending any claim, action, suit or
proceeding or of avoiding the same or the imposition of any judgment or
settlement and reasonable costs of enforcing any Indemnification Obligations.

     "Madden" has the meaning set forth in the preamble.

     "Madden Disclosure Schedule" means the disclosure schedule of Madden
accompanying this Agreement.

     "Madden Indemnified Parties" has the meaning set forth in Section 12.2(a).

     "Material Adverse Effect" means any material adverse effect on the
business, operations, assets, condition (financial or otherwise), liabilities,
or results of operations of either Company or the Companies taken as a whole.

     "Net Working Capital" means the current assets of the Companies, including,
without limitation and without duplication, Cash-On-Hand, inventory,
non-factored accounts receivable net of reserves, amounts due from factor and
prepaid expenses (including, without limitation, the unused portion of prepaid
royalties), minus all liabilities of the Companies, including, without
limitation and without duplication, Debt, accounts payable, accrued employee
expenses (including, without limitation, any bonus accruals) and any applicable
tax accruals related thereto, amounts payable to factor, loan payable to factor,
and taxes payable (other than any Taxes attributable in whole or in part to a
338(h)(10) Election or analogous elections), in each case, if not otherwise
defined herein, as such terms have the meanings assigned to them by GAAP applied
on a basis consistent with the preparation of an audited balance sheet.

     "Notice of Set-Off Dispute" has the meaning set forth in Section 13.16(b).

     "Permitted Encumbrances" has the meaning set forth in Section 4.7(c).

     "Person" means an individual, partnership, venture, unincorporated
association, organization, syndicate, corporation, limited liability company, or
other entity, trust, trustee, executor, administrator or other legal or personal
representative or any government or any agency or political subdivision thereof.

                                      -5-
<PAGE>

     "Post-Closing Working Capital Adjustment" has the meaning set forth in
Section 2.3(b)(i).

     "Pre-Closing Period" means all taxable periods ending on or before the
Closing Date and the portion ending on or before the Closing Date of any taxable
period that includes (but does not begin or end on) the Closing Date.

     "Prime Rate" shall mean the rate of interest of The JPMorgan Chase Bank (or
its successor and assign) announces from time to time as its prime lending rate
as then in effect, or if no such rate is announced by The JPMorgan Chase Bank
(or its successor or assign), the prime lending rate announced by a New York
City money center bank selected by Madden and reasonably acceptable to Seller.

     "Purchase Price Accounts" has the meaning set forth in Section 2.2(b).

     "RC" means Renee Cohen.

     "Real Property" has the meaning set forth in Section 4.7(a)

     "Real Property Documents" has the meaning set forth in Section 4.7(a)

     "Real Property Interests" has the meaning set forth in Section 4.7(a)

     "Release" means any releasing, spilling, leaching, pumping, leaking,
pouring, emitting, emptying, discharging, depositing, injecting, escaping,
dumping, migrating or disposing, whether intentional or otherwise, of any
Hazardous Material into the Environment.

     "Returns" means returns, reports, and information statements with respect
to Taxes required to be filed with the IRS or any other Governmental Body,
domestic or foreign, including consolidated, combined and unitary tax returns,
and returns required in connection with any Employee Benefit Plan.

     "Revised Closing Date Balance Sheet" has the meaning set forth in Section
2.3(a)(ii).

     "SEC" means the U.S. Securities and Exchange Commission.

     "Seller" has the meaning set forth in the preamble.

     "Seller Indemnified Parties" has the meaning set forth in Section 12.3(a).

     "Services Agreement" means the Services Agreement among Seller, each of the
Companies and Madden, which has been executed and delivered prior to or
simultaneously with the execution and delivery of this Agreement and which shall
become effective as of the Closing, attached hereto as Exhibit F.

     "Set-Off Notice" has the meaning set forth in Section 13.16(b).

     "Set-Off Review Period" has the meaning set forth in Section 13.16(b).

                                      -6-
<PAGE>

     "SL" means Steven Lloyd.

     "Straddle Period" has the meaning set forth in Section 8.1(a)(ii).

     "Tax" or "Taxes" means taxes, fees, levies, duties, tariffs, imposts and
governmental impositions or charges of any kind payable to any Governmental Body
in any jurisdiction, including (i) income, franchise, profits, gross receipts,
ad valorem, net worth, value added, sales, use, service, real or personal
property, special assessments, capital stock, license, payroll, withholding,
employment, estimated, social security, workers' compensation, unemployment
compensation, utility, severance, production, excise, stamp, occupation,
premiums, windfall profits, transfer and gains taxes, and (ii) interest,
penalties, additional taxes and additions to tax imposed with respect thereto.

     "338(h)(10) Election" has the meaning set forth in Section 8.1(b)(i).

     "Transaction Documents" means this Agreement, the Employment Agreements,
the Earn-Out Agreement and the Services Agreement.

     "U.S." means the United States of America.

     "Working Capital Refund" has the meaning set forth in Section 2.3(b).

                                   ARTICLE II

                                Purchase and Sale
                                -----------------

     2.1 Purchase and Sale of Company Shares. Subject to and upon the terms and
conditions hereinafter set forth, at the Closing, and in reliance upon the
representations and warranties contained in this Agreement or made pursuant
hereto, Seller hereby agrees to sell, assign, transfer and deliver to Madden,
and Madden hereby agrees to purchase from Seller, all of the issued and
outstanding shares of capital stock of each of the Companies as set forth in
Section 2.1 of the Disclosure Schedule (collectively the "Company Shares"), free
and clear of all Encumbrances.

     2.2 Cash Purchase Price.

     (a) In consideration of the aforesaid sale, assignment, transfer and
delivery of the Company Shares, Madden shall, (i) six (6) days following the
Closing Date, pay or cause to be paid to Seller an amount, in cash, equal to (A)
eighteen million dollars ($18,000,000) (the "Cash Purchase Price") less (B)
three million dollars ($3,000,000) (the "Holdback Amount"), and (ii) in the
amounts and at such times as are set forth in the Earn-Out Agreement, pay to
Seller all amounts (collectively, the "Earn-Out Payment") required to be paid
pursuant to the terms of the Earn-Out Agreement. The Cash Purchase Price may be
adjusted as provided for in Section 2.3. The Holdback Amount shall be available
as a nonexclusive means to fulfill Seller's obligations pursuant to Section 2.3,
and shall be released to Seller no later than three (3) Business Days following
the final settlement of the adjustment set forth in such Section.

                                      -7-
<PAGE>

     (b) All payments of cash pursuant to Section 2.2(a) shall be made in
immediately available funds by wire transfer to an account or accounts (the
"Purchase Price Accounts") specified by Seller at least two (2) Business Days
prior to the date such payments are to be made.

     2.3 Post-Closing Adjustment.

     (a) Closing Date Balance Sheet.

          (i) Preparation of Closing Date Balance Sheet. As promptly as
     practicable, but in any event within seventy-five (75) days after the
     Closing Date, Madden shall prepare and deliver to Seller (A) the Closing
     Date Balance Sheet, which Closing Date Balance Sheet shall be prepared in
     accordance with GAAP applied on a basis consistent with the preparation of
     the Balance Sheet, and (B) a calculation of Net Working Capital as of the
     close of business on the Closing Date based upon the Closing Date Balance
     Sheet (the "Closing Date Net Working Capital"), which shall explain in
     reasonable detail such calculation of Closing Date Net Working Capital.

          (ii) Closing Date Balance Sheet Disputes. Seller may dispute the
     amount of the Closing Date Net Working Capital reflected on the Closing
     Date Balance Sheet by sending written notice (a "Dispute Notice") to Madden
     within thirty (30) days of Madden's delivery of the Closing Date Balance
     Sheet and Closing Date Net Working Capital calculation to Seller (such
     delivery date, the "Delivery Date"). The Dispute Notice shall identify, in
     reasonable detail, each disputed item on the Closing Date Balance Sheet,
     specifying the amount of such dispute and setting forth the basis for such
     dispute. In the event of such a dispute, Madden and Seller shall attempt in
     good faith to reconcile their differences (including providing information
     that is reasonably requested to the other party), and any resolution by
     them as to any disputed items shall be final, binding and conclusive on the
     parties and shall be evidenced by a writing signed by Madden and Seller,
     including a revised Closing Date Balance Sheet (together with a revised
     calculation of the Closing Date Net Working Capital based upon such revised
     Closing Date Balance Sheet, the "Revised Closing Date Balance Sheet")
     reflecting such resolution. If Madden and Seller are unable to reach such
     resolution within twenty (20) days after Seller's delivery of the Dispute
     Notice to Madden, then Madden and Seller shall promptly submit any
     remaining disputed items to an Independent Accounting Firm for final
     binding resolution. If any remaining disputed items are submitted to an
     Independent Accounting Firm for resolution (A) each party will furnish to
     the Independent Accounting Firm such workpapers and other documents and
     information relating to the remaining disputed items as the Independent
     Accounting Firm may reasonably request and are available to such party, and
     each party will be afforded the opportunity to present to the Independent
     Accounting Firm any material relating to the disputed items and to discuss
     the resolution of the disputed items with the Independent Accounting Firm;
     (B) each party will use its good faith commercially reasonable efforts to
     cooperate with the resolution process so that the disputed items can be
     resolved within forty-five (45) days of submission of the disputed items to
     the Independent Accounting Firm; (C) the determination by the Independent
     Accounting Firm, as set forth in a written notice to Madden and Seller
     (which written notice shall include a Revised Closing Date Balance Sheet),

                                      -8-
<PAGE>

     shall, subject to the provisions of Section 2.3(a)(iii), be final, binding
     and conclusive on the parties; and (D) the fees and disbursements of the
     Independent Accounting Firm shall be allocated by the Independent
     Accounting Firm between Madden and Seller in the same proportion that the
     aggregate dollar amount of the disputed items submitted to the Independent
     Accounting Firm that are unsuccessfully disputed by Seller (as finally
     determined by the Independent Accounting Firm) bears to the total amount of
     all disputed items submitted to the Independent Accounting Firm. By way of
     illustration, if Seller disputes $500,000 of items, and the Independent
     Accounting Firm determines that Seller's position is correct as to $400,000
     of the disputed items, then Madden would bear 80 percent and Seller would
     bear 20 percent of such fees and disbursements.

          (iii) Final Closing Date Balance Sheet. The Closing Date Balance
     Sheet, or, if one has been adopted pursuant to Section 2.3(a)(ii), the
     Revised Closing Date Balance Sheet, shall be deemed to be final, binding
     and conclusive on Madden and Seller (the "Final Closing Date Balance
     Sheet") upon the earliest of (A) the failure of Seller to deliver to Madden
     the Dispute Notice within thirty (30) days of the Delivery Date; (B) the
     resolution by Madden and Seller of all disputes, as evidenced by the
     Revised Closing Date Balance Sheet; and (C) the resolution by the
     Independent Accounting Firm of all disputes, as evidenced by the Revised
     Closing Date Balance Sheet. Any adjustment to the Cash Purchase Price based
     on the Final Closing Date Balance Sheet shall be made in accordance with
     Section 2.3(b).

     (b) Post-Closing Working Capital Adjustment. Upon the Final Closing Date
Balance Sheet being deemed final, binding and conclusive pursuant to Section
2.3(a)(iii), an adjustment to the Cash Purchase Price shall be made as follows
(the "Post-Closing Working Capital Adjustment"): In the event that the Closing
Date Net Working Capital reflected on the Final Closing Date Balance Sheet plus
the Additional Working Capital Amount (as defined below) is less than five
million five hundred thousand dollars ($5,500,000), then Seller shall be
obligated to pay Madden on the Adjustment Payment Date the Working Capital
Refund (as defined below) in immediately available funds, at Madden's option, by
certified or official bank check or by wire transfer to an account specified, in
writing, by Madden; provided, however, that any payments owed by Seller to
Madden pursuant to this Section 2.3(b) shall first be satisfied by a deduction
from the Holdback Amount. The "Working Capital Refund" means the amount by which
the Closing Date Net Working Capital on the Final Closing Date Balance Sheet
plus the Additional Working Capital Amount is less than five million five
hundred thousand dollars ($5,500,000). Additional Working Capital Amount means
an amount equal to the gross profit after royalties on sales of any goods
shipped between the Closing Date until and inclusive of February 17, 2006 less
five percent (5%) of such sales; provided, however, that (i) such goods were
included in the Open Orders File, attached hereto as Exhibit J; (ii) such goods
were in the warehouse on or before February 10, 2006; and (iii) such goods had a
start ship date at least one (1) day prior to the Closing Date.

                                      -9-
<PAGE>

                                   ARTICLE III

                                     Closing
                                     -------

     3.1 Closing Date. Subject to the fulfillment or waiver by the beneficiary
thereof of the agreements and conditions precedent set forth in Articles IX and
X, the closing of the transactions contemplated hereby (the "Closing") shall be
held on February 7, 2006, assuming the satisfaction or waiver of all conditions
to closing set forth in Articles IX and X of this Agreement, at 10:00 a.m.,
prevailing local time, at the offices of Kramer Levin Naftalis & Frankel LLP,
1177 Avenue of the Americas, New York, NY 10036, or on such other date or at
such other time or place as may be agreed to in writing by Madden and Seller.
The date on which the Closing actually occurs is herein referred to as the
"Closing Date."

     3.2 Certain Actions at Closing. At the Closing:

     (a) Seller shall deliver, or cause to be delivered, to Madden stock
certificates representing all of the Company Shares, accompanied by stock powers
duly endorsed in blank or duly executed instruments of transfer;

     (b) to the extent not previously executed and/or delivered to Madden,
Seller shall execute and/or deliver to Madden, or cause to be executed and/or
delivered to Madden, each of the Transaction Documents and any other document,
certificate or other instrument required to be executed and/or delivered by
Seller and each of the Companies under this Agreement at or prior to the
Closing;

     (c) to the extent not previously executed and/or delivered to Seller,
Madden shall execute and/or deliver to Seller, each of the Transaction Documents
and any other document, certificate or other instrument required to be executed
and/or delivered by Madden under this Agreement at or prior to the Closing; and

     (d) Seller shall be liable for and shall pay all stamp, transfer and
similar Taxes, direct or indirect, if any, attributable to the transfer of the
Company Shares and, in connection therewith, shall affix any necessary transfer
stamps to the stock certificates (or stock transfer powers) evidencing the
Company Shares.

                                   ARTICLE IV

                    Representations and Warranties of Seller
                    ----------------------------------------

     Seller hereby represents and warrants to Madden as follows:

     4.1 Organization and Good Standing. Each Company is a corporation duly
organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation. The Companies have full corporate power and
authority to own or lease their respective properties and to carry on their
businesses as they are now being conducted. Each of the Companies is duly
qualified to transact business and is in good standing in each jurisdiction
wherein the nature of the business done or the property owned, leased or
operated by it requires such qualification, except where the failure to be so
qualified would not be reasonably likely to have a Material Adverse Effect.

                                      -10-
<PAGE>

Copies of the organizational documents of each of the Companies have been
delivered to Madden and are true, complete and accurate in all respects. The
corporate minutes and corporate records of each of the Companies have been made
available to Madden and are true, complete and accurate in all respects. The
stock register and transfer records of each of the Companies have been made
available to Madden and are true, complete and accurate in all respects. Except
as set forth in Section 4.1 of the Disclosure Schedule, neither of the Companies
has any direct or indirect subsidiaries and does not own any ownership or equity
interest in any Person.

     4.2 Capitalization.

     (a) The capitalization of each of the Companies is as set forth in Section
2.1 of the Disclosure Schedule. The Company Shares are all of the issued and
outstanding shares of the Companies and have been duly authorized and are
validly issued and outstanding, fully paid and non-assessable. Seller owns,
beneficially and of record, and has valid and marketable title to, and the right
to transfer to Madden, all of the Company Shares set forth in Section 2.1 of the
Disclosure Schedule, free and clear of any and all Encumbrances. At the Closing
Madden will own, and will have valid and marketable title to, all of the issued
and outstanding shares of capital stock of each of the Companies, free and clear
of any and all Encumbrances not created by or with the written consent of
Madden. No Person other than Madden has any written or oral agreement,
arrangement, understanding or option for, or any right or privilege (whether by
law, preemption or contract) that is or is capable of becoming an agreement,
arrangement, understanding or option for, the purchase or acquisition from
either of the Companies or any Person of any shares of capital stock or other
securities of either of the Companies.

     (b) There are no outstanding or authorized options, warrants, purchase
agreements, participation agreements, subscription rights, conversion rights,
exchange rights or other securities, contracts, arrangements, understanding or
commitments that could require either of the Companies to issue, sell or
otherwise cause to become outstanding any of its authorized but unissued shares
of capital stock or any securities convertible into, exchangeable for or
carrying a right or option to purchase shares of capital stock, or to create,
authorize, issue, sell or otherwise cause to become outstanding any new class of
capital stock. None of the issued and outstanding shares of capital stock of
either of the Companies has been issued in violation of any rights of any Person
or in violation of the registration requirements of any applicable
jurisdiction's securities Laws.

     4.3 Authorization.

     (a) Seller has full legal capacity to enter into and carry out Seller's
obligations under this Agreement and the other applicable Transaction Documents,
and is not under any prohibition or restriction, contractual, statutory or
otherwise, against doing so. This Agreement, the Earn-Out Agreement, Seller's
Employment Agreement and the Services Agreement have been duly executed and
delivered by Seller and constitute legal, valid and binding obligations of
Seller, enforceable against Seller in accordance with their respective terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, moratorium or other laws affecting the rights of creditors generally
and by general principles of equity.

                                      -11-
<PAGE>

     (b) The Employment Agreements, the Services Agreement and the Earn-Out
Agreement have been duly executed and delivered by the applicable Companies and
constitute legal, valid and binding obligations of each of the Companies,
enforceable against each of the Companies in accordance with their respective
terms, except as such enforceability may be limited by applicable bankruptcy,
insolvency, moratorium or other laws affecting the rights of creditors generally
and by general principles of equity.

     4.4 No Conflicts; Consents. Except as set forth in Section 4.4 of the
Disclosure Schedule, neither the execution and delivery by Seller or either of
the Companies of this Agreement or any of the Transaction Documents to which
Seller or either of the Companies is a party, nor the consummation of the
transactions contemplated hereby or thereby, will, with or without notice or
lapse of time or both, directly or indirectly, (i) conflict with or violate the
organizational documents of, or resolutions of the directors or shareholders of,
either of the Companies, (ii) conflict with, violate, result in the breach of
any term of, result in the acceleration of performance of any obligation under,
constitute a default under, give any Person the right to cancel, terminate or
modify, or require the consent or approval of or any notice to or filing with
any third party or Governmental Body under, (x) any note, mortgage, deed of
trust, lease or other agreement or instrument to which Seller or either of the
Companies is a party or by which Seller or either of the Companies or any of
their respective properties or assets are bound, or (y) any Law, writ,
injunction, or License of any Governmental Body having jurisdiction over Seller,
either of the Companies or their respective properties or assets, or (iii)
create an Encumbrance on any of the shares of capital stock or properties or
assets of either of the Companies, including, without limitation, the Company
Shares.

     4.5 Financial Statements; Undisclosed Liabilities; Promotions and
Allowances; Inventory.

     (a) Except as set forth in Section 4.5(a) of the Disclosure Schedule, the
Financial Statements (true, complete and accurate copies of which have been
previously delivered to Madden) have been prepared from the books and records of
each of the Companies in accordance with GAAP applied on a consistent basis
throughout the periods covered thereby and fairly present in all material
respects the financial condition of each of the Companies as at their respective
dates and the results of operations and cash flows of each of the Companies for
the periods covered thereby. The statements of operations included in the
Financial Statements do not include any item of special or non-recurring income,
except as specifically identified therein.

     (b) As of the date of the Balance Sheet, other than those (i) set forth in
Section 4.5(b) of the Disclosure Schedule or (ii) which are reflected or
reserved against on the Balance Sheet, neither of the Companies had any
liabilities, debts or obligations (whether absolute, accrued, contingent or
otherwise).

     (c) Section 4.5(c) of the Disclosure Schedule sets forth (i) the material
terms of all return, markdown, promotion, co-op advertising and other similar
programs and allowances currently offered by each of the Companies to any of
their customers and (ii) the amount of the reserve established by each of the
Companies as of December 31, 2005, regarding the items described in clause (i).

                                      -12-
<PAGE>

     (d) Except as set forth in Section 4.5(d) of the Disclosure Schedule, the
inventory reflected in the Financial Statements or thereafter acquired has been
determined and valued in accordance with GAAP as reflected in the Financial
Statements and the books and records of each of the Companies at the lower of
cost or market. Except as set forth in Section 4.5(d) of the Disclosure
Schedule: (i) the inventory of each of the Companies is salable, and consists of
items which are good and merchantable (as defined in the Uniform Commercial Code
of the State of New York) at normal mark-up, in each case in the ordinary course
of business consistent with past practice without any material problems; and
(ii) no previously sold inventory is subject to refunds materially in excess of
that historically experienced by each of the Companies. All commitments or
orders for work-in-process were entered into in the ordinary course of business
consistent with pact practice and in a commercially reasonable manner.

     4.6 Taxes.

     (a) Except as set forth in Section 4.6(a) of the Disclosure Schedule, each
of the Companies has timely filed with the appropriate taxing authorities all
Returns required to be filed by it (taking into account any extension of time to
file). The information on such Returns is complete and accurate. Each of the
Companies has paid, or, where payment is not yet due, has established an
adequate accrual on the Balance Sheet in accordance with GAAP for the payment
of, all Taxes (whether or not shown on any Return) due and payable, except for
any Taxes that result by reason of a 338(h)(10) Election or analogous elections
made pursuant to Section 8.1(b). There are no liens for Taxes (other than for
Permitted Encumbrances) upon the properties or assets of either of the
Companies.

     (b) Except as set forth in Section 4.6(b) of the Disclosure Schedule, no
unpaid (or unreserved in accordance with GAAP) and unresolved deficiencies for
Taxes have been claimed, proposed or assessed, in each case in writing, by any
taxing authority or other Governmental Body with respect to either of the
Companies for any Pre-Closing Period, and there are no pending or, to the
Knowledge of Seller and each of the Companies, threatened audits,
investigations, claims or assessments for or relating to any liability in
respect of Taxes of or with respect to either of the Companies. Neither of the
Companies has requested any extension of time within which to file any currently
unfiled Returns in respect of any Taxes and no waiver or extension of a
statutory period of limitations for the assessment of any Taxes is in effect
with respect to either of the Companies.

     (c) Except as set forth in Section 4.6(c) of the Disclosure Schedule, (i)
except for any Taxes that result by reason of a 338(h)(10) Election made
pursuant to Section 8.1(b), each of the Companies has made or will make
provisions for all Taxes payable by it with respect to any Pre-Closing Period
which have not been paid prior to the Closing Date; (ii) except for any Taxes
that result by reason of a 338(h)(10) Election made pursuant to Section 8.1(b),
the provisions for Taxes with respect to each of the Companies for the
Pre-Closing Period (excluding any reserve for deferred Taxes established to
reflect timing differences between book and Tax income) are adequate to cover
all Taxes with respect to such period; (iii) each of the Companies has withheld
and paid all Taxes required to have been withheld and paid in connection with
amounts paid or owing to any employee, independent contractor, creditor,
shareholder or other third party; (iv) all material elections with respect to
Taxes affecting either of the Companies as of the date hereof are set forth in

                                      -13-
<PAGE>

Section 4.6(c)(iv) of the Disclosure Schedule; (v) there are no advance tax
rulings in respect of any Tax issued to or pending between or with respect to
either of the Companies and any taxing authority or any other written agreements
with a Tax authority with regard to any Tax; (vi) the tax year end for each of
the Companies is December 31; (vii) neither of the Companies is liable for Taxes
of any other Person, and neither is currently under any contractual obligation
to or a party to any tax sharing agreement or any other agreement providing for
payments by either of the Companies with respect to Taxes; (viii) neither of the
Companies is a party to any joint venture, partnership or other arrangement or
contract which could be treated as a partnership for income tax purposes; (ix)
neither of the Companies has granted any Person a power of attorney with respect
to Taxes; (x) neither of the Companies has entered into any sale leaseback or
any leveraged lease transaction; (xi) neither of the Companies, as of the
Closing Date, has agreed and will not be required, as a result of a change made
prior to the Closing Date in method of accounting or otherwise, to include any
adjustment under any provision of Hong Kong, U.S., state, local or foreign law
in taxable income for any period after the Closing Date; (xii) Section
4.6(c)(xii) of the Disclosure Schedule contains a list of all jurisdictions in
which each of the Companies is required to file any Return, and no written claim
has ever been made by a taxing authority in a jurisdiction where either of the
Companies does not currently file Returns that either of the Companies is or may
be subject to taxation by that jurisdiction; (xiii) neither of the Companies has
filed or been included in a combined, consolidated or unitary return (or
substantial equivalent thereof) of any Person; (xiv) neither of the Companies is
obligated under any agreement with respect to industrial development bonds or
other obligations with respect to which the excludability from gross income of
the holder for Federal or state income tax purposes could be affected by the
transactions contemplated hereunder; (xv) neither of the Companies has engaged
in any transaction for which its participation is required to be disclosed under
Treasury Regulation ss. 1.6011-4; and (xvi) since its inception, DMFA has
qualified for and has properly had in effect an election (which has not
terminated) to be an S corporation within the meaning of Section 1361(a)(1) of
the Code (and any corresponding provision of applicable state law), and a copy
of such election has been provided to Madden.

     4.7 Real and Personal Property.

     (a) Section 4.7(a)-1 of the Disclosure Schedule contains a complete list by
address of all real property owned, leased, operated or used by each of the
Companies (collectively, the "Real Property"), indicating the nature of the
interest of such Companies therein (collectively, the "Real Property
Interests"). No litigation, condemnation, expropriation, eminent domain or
similar proceeding affecting all or any portion of any Real Property is pending
or threatened. Each of the Companies has furnished to Madden true, correct and
complete copies of all documents relating to the Real Property Interests
(collectively, the "Real Property Documents"). There are no oral agreements with
respect to any Real Property Interest. Except as set forth in Section 4.7(a)-2
of the Disclosure Schedule, no Real Property Document requires that the consent
or approval of any third party be obtained in order to consummate the
transactions contemplated by this Agreement, nor do such transactions violate
any Real Property Document or cause either of the Companies to be in default
under any Real Property Document. Neither of the Companies nor Seller has given
or received any notice of default under any Real Property Document, and neither
of the Companies is in default thereunder. No option to extend, renew or
purchase arising under any Real Property Document has been exercised. No

                                      -14-
<PAGE>

guaranty or other undertaking with respect to the performance of any obligation
arising under any Real Property Document has been delivered by either of the
Companies. All service, management, leasing and other similar agreements with
respect to any Real Property Interest (other than leases of Real Property listed
on Section 4.7(a)-1 of the Disclosure Schedule) are terminable upon no more than
thirty (30) days' prior notice.

     (b) Except as set forth in Section 4.7(b) of the Disclosure Schedule, each
of the Companies has good and insurable (in the case of Real Property Interests)
title to all of the properties and assets, real and personal, tangible and
intangible, it owns, including those reflected on its books and records and on
the Balance Sheet (except those sold or disposed of subsequent to the date
thereof in the ordinary course of business consistent with past practice and in
a commercially reasonable manner), free and clear of all Encumbrances, except
for Permitted Encumbrances. Except as set forth in Section 4.7(b) of the
Disclosure Schedule, each of the Companies has a valid and enforceable fee,
leasehold, license or other interest in all of the other properties and assets,
real or personal, tangible or intangible, which are used in the operation of the
business of such Company, free and clear of all Encumbrances, except for
Permitted Encumbrances. Except as set forth in Section 4.7(b) of the Disclosure
Schedule, none of the properties or assets owned, leased, operated or used by
either of the Companies is subject to any lease, sublease, license, sublicense
or other agreement granting to any other Person any right to the use, occupancy
or enjoyment of such property or any portion thereof.

     (c) As used herein, "Permitted Encumbrances" means (i) liens for Taxes not
yet due and payable or which are being diligently contested in good faith by
appropriate proceedings and as to which appropriate reserves (to the extent
required by GAAP) have been established in the books and records of each of the
Companies; (ii) mechanics', materialmen's, carriers', warehousemen's, landlord's
and similar liens securing obligations not yet delinquent or which are being
diligently contested in good faith by appropriate proceedings and as to which
appropriate reserves (to the extent required by GAAP) have been established in
the books and records of each of the Companies; (iii) such imperfections of
title, Encumbrances and easements, restrictive covenants and rights of way as do
not and will not materially detract from or interfere with the use of the
properties subject thereto or affected thereby, or otherwise materially impair
business operations involving such properties; (iv) purchase money Encumbrances
securing the purchase price of the related personal property set forth in
Section 4.7(c) of the Disclosure Schedule; and (v) platting, subdivision,
zoning, building and other similar legal requirements which are not violated by
the building, structures and other improvements located on any real property,
whether or not of record.

     4.8 Intellectual Property.

     (a) Except as set forth in Section 4.8(a) of the Disclosure Schedule, each
of the Companies owns, or has the valid right to use or license, without
Encumbrances, all Intellectual Property Rights as used in its business as
presently conducted and as it is expected to be conducted as of the Closing
(such Intellectual Property Rights hereinafter referred to as the "Company IP
Rights"). The Company IP Rights are sufficient to conduct the business of each
of the Companies.

     (b) Except as set forth in Section 4.8(b) of the Disclosure Schedule, the
execution, delivery and performance of this Agreement and the consummation of

                                      -15-
<PAGE>

the transactions contemplated hereby will not constitute a breach of any
instrument or agreement governing any Company IP Rights (the "Company IP Rights
Agreements"), will not cause the forfeiture or termination or give rise to a
right of forfeiture or termination of any Company IP Rights or impair the right
of either of the Companies or, after the Closing, Madden, to own, use or license
any Company IP Rights or portion thereof.

     (c) Except as set forth in Section 4.8(c) of the Disclosure Schedule, there
are no royalties, honoraria, fees or other payments payable by either of the
Companies to any Person for the use by either of the Companies of any Company IP
Rights.

     (d) Except as set forth in Section 4.8(d) of the Disclosure Schedule, (i)
to the Knowledge of Seller the conduct of the business of each of the Companies,
as presently conducted, does not violate or infringe any Intellectual Property
Rights of any other Person, and (ii) there is no pending or, to the Knowledge of
Seller and each of the Companies, threatened claim or litigation contesting the
validity, ownership, registrability, right to use or right to license any
Company IP Rights, nor is there any valid or reasonable basis for any such
claim, nor has either of the Companies or Seller received any notice asserting
that any Company IP Rights or the proposed use, registration or license thereof
infringes or otherwise violates, or will infringe or otherwise violate the
rights of such Person.

     (e) Except as set forth in Section 4.8(e)(i) of the Disclosure Schedule,
each of the Companies has taken all reasonable and practicable steps to
safeguard and maintain the secrecy and confidentiality of its trade secrets.
Seller has delivered to Madden true, complete and accurate copies of all
agreements that any directors, officers, employees or consultants of either of
the Companies have executed regarding (i) the protection of proprietary
information, and (ii) the assignment to either of the Companies of all
Intellectual Property Rights arising from the services performed for either of
the Companies by such persons. Except as set forth in Section 4.8(e)(ii) of the
Disclosure Schedule, no current or prior directors, officers, employees,
consultants or contractors of either of the Companies claim or have a right to
claim an ownership interest in any Company IP Rights.

     (f) Section 4.8(f) of the Disclosure Schedule separately lists (i) all
licenses and other agreements under which either of the Companies or any Person
granted rights by either of the Companies uses any Company IP Rights, and (ii)
all licenses and other agreements under which either of the Companies or any
Person granted rights by either of the Companies uses any Intellectual Property
of any other Person. All such licenses and other agreements are valid,
enforceable, in full force and effect, and without breach Known to Seller and
will continue to be so without change in any provision or term thereof after the
Closing.

     (g) Except as set forth in Section 4.8(g) of the Disclosure Schedule, (i)
no notice has been sent, no claim has been made and no action or proceeding has
been filed asserting that any Person's use of, or application for, any
Intellectual Property Rights infringes upon or otherwise violates any Company IP
Rights, and (ii) no Person is infringing upon or otherwise violating any Company
IP Rights, or has filed to register any Intellectual Property Rights which, if
used by any third party, would infringe upon or otherwise violate the Company IP
Rights.

                                      -16-
<PAGE>

     (h) Section 4.8(h) of the Disclosure Schedule sets forth a list of all
patents, trademarks, service marks, trade dress, copyrights, slogans, trade
names, and internet domain names comprising the Company IP Rights, including
without limitation all registrations and applications for any of the foregoing
owned, licensed, used or filed by or on behalf of either of the Companies
anywhere in the world. For each trademark listed in Section 4.8(h) of the
Disclosure Schedule, identify the trademark, the jurisdiction, the
registration/application number, the registrant/applicant, the class, the
goods/services, the status (including any rejections and the basis therefor),
and the principal terms of any license governing such trademark. All
applications, registrations and licenses listed in Section 4.8(h) of the
Disclosure Schedule, unless otherwise indicated, are in full force and effect
and have not been cancelled, expired, rejected or abandoned. Except as set forth
in Section 4.8(d) of the Disclosure Schedule, there is no pending, existing or,
to the Knowledge of Seller and each of the Companies, threatened opposition,
interference, cancellation, proceeding or other legal or governmental proceeding
before any court or Governmental Body against or involving the applications or
registrations listed in Section 4.8(h) of the Disclosure Schedule.

     4.9 Contracts and Agreements.

     (a) Section 4.9(a) of the Disclosure Schedule sets forth a true, complete
and accurate list of each of the following contracts, agreements, arrangements,
instruments or understandings, whether oral or written, to which either of the
Companies is a party or by which either of the Companies or its assets or
properties are bound, except for purchase orders entered into by the Companies
with customers, manufacturers and suppliers in the ordinary course of business
consistent with past practice and, in the case of purchase orders with
manufacturers and suppliers, on the forms of purchase order previously provided
to Madden (collectively, the "Contracts"):

          (i) each employment and other similar agreement with any Person
     retained by either of the Companies as an employee or "leased employee"
     (within the meaning of Section 414(n) or (o) of the Code or other similar
     Law) providing for compensation, severance or a fixed term of employment in
     respect of services performed by any employee or "leased employee" of
     either of the Companies;

          (ii) each management, consulting, independent contractor,
     subcontractor, retainer or other similar type of agreement under which
     services are provided by any Person to either of the Companies with a term
     of more than one (1) year or requiring payments in excess of $50,000 per
     annum or $75,000 in the aggregate;

          (iii) each other agreement or commitment for services and supplies
     (other than Company Products) provided by any other Person to either of the
     Companies with a term of more than one (1) year or requiring payments in
     excess of $50,000 per annum or $75,000 in the aggregate;

          (iv) each agreement with sales or commission agents or sales
     representatives with a term of more than one (1) year or requiring payments
     in excess of $50,000 per annum or $75,000 in the aggregate;

                                      -17-
<PAGE>

          (v) each agreement or commitment for the supply of products (other
     than Company Products) or services by either of the Companies to any other
     Person with a term of more than one (1) year (other than those that are
     terminable upon not more than thirty (30) days' notice by the applicable
     Companies without penalty) or involving payments in excess of $50,000 per
     annum or $75,000 in the aggregate;

          (vi) each agreement that restricts in any material manner the
     operation of the business of either of the Companies as presently
     conducted, including each agreement that restricts the ability of either of
     the Companies to conduct business in any geographic or product market, to
     buy or sell particular goods or services, to buy or sell goods or services
     from any other Person or to solicit customers, employees or other service
     providers;

          (vii) each agreement with any officer or director of either of the
     Companies;

          (viii) each agreement with an Affiliated Person or with any entity in
     which an officer or director of either of the Companies holds an interest;

          (ix) each lease (as lessor, lessee, sublessor or sublessee) of any
     real property;

          (x) each lease (as lessor, lessee, sublessor or sublessee) of any
     tangible personal property requiring payment during its term or any
     extension or renewal thereof in excess of $50,000;

          (xi) each license (as licensor, licensee, sublicensor or sublicensee)
     of any Intellectual Property Rights (other than licenses of commercially
     available, "packaged, off the shelf," shrink-wrap or click-through computer
     software), including, without limitation, each license relating to any
     Company Products;

          (xii) each agreement under which any money has been or may be borrowed
     or loaned, or any note, bond, factoring agreement, indenture or other
     evidence of indebtedness has been issued or assumed, and each guaranty
     (including "take-or-pay" and "keepwell" agreements) of any evidence of
     indebtedness or other obligation, or of the net worth, of any Person;

          (xiii) each mortgage agreement, deed of trust, security agreement,
     purchase money agreement, conditional sales contract or capital lease;

          (xiv) each partnership, joint venture or similar agreement;

          (xv) each agreement relating to securities of either of the Companies,
     including shareholder agreements, voting agreements, and any agreements
     granting preferential rights to acquire securities of either of the
     Companies or containing restrictions with respect to the payment of
     dividends or other distributions in respect of the capital stock or
     securities of either of the Companies;

                                      -18-
<PAGE>

          (xvi) each agreement or commitment to make unpaid capital expenditures
     in excess of $10,000;

          (xvii) each agreement containing a change of control provision;

          (xviii) each manufacturing, distribution or sourcing agreement or
     arrangement;

          (xix) each agreement or other arrangement pursuant to which either of
     the Companies is obligated to accept returned merchandise or grant credit
     for unsold merchandise other than as set forth in standard form,
     non-negotiated purchase orders or confirmations;

          (xx) each agreement or other arrangement relating to any EDI or
     similar programs;

          (xxi) each agreement or other arrangement providing for the
     development of software for, or license of software (other than
     off-the-shelf, shrink-wrap, or click-through software applications) or
     Intellectual Property Rights to, either of the Companies, which software or
     Intellectual Property Rights are used or incorporated in any of the Company
     Products, including rights of publicity;

          (xxii) each agreement with respect to any Company IP Rights;

          (xxiii) each agreement or arrangement with respect to advertising
     (including co-op advertising), marketing or any concept shops or in-store
     sales environments (i.e. shop in shops) for any Company Product;

          (xxiv) each agreement that obligates either of the Companies to
     indemnify a third party; and

          (xxv) each other agreement (or group of related agreements) having an
     indefinite term or a fixed term of more than one (1) year (other than those
     that are terminable upon not more than thirty (30) days' notice by either
     of the Companies without penalty) or requiring payments in excess of
     $50,000 per year or $75,000 in the aggregate or the loss of which could
     reasonably be expected to have, individually or in the aggregate, a
     Material Adverse Effect.

Complete copies of all written (and summaries of all oral) Contracts required to
be disclosed pursuant to this Section 4.9(a) have been previously delivered to
Madden.

     (b) Each of the Contracts is legal, valid, binding and in full force and
effect and is enforceable by the applicable Companies in accordance with its
respective terms, except as such enforceability may be limited by bankruptcy,
insolvency, moratorium and other similar laws affecting creditors' rights
generally and by general principles of equity. Except as set forth in Section
4.9(b) of the Disclosure Schedule, each of the Companies is not (with or without
the lapse of time or the giving of notice, or both) in breach of or in default
under any of the Contracts, and, to the Knowledge of Seller and each of the
Companies, no other party to any of the Contracts is (with or without the lapse

                                      -19-
<PAGE>

of time or the giving of notice, or both) in breach of or in default under any
of the Contracts.

     4.10 Insurance. All insurance policies currently maintained by each of the
Companies, or under which either of the Companies is insured, are accurately
listed in Section 4.10 of the Disclosure Schedule and complete copies of such
policies have been previously delivered to Madden. Each such insurance policy is
in full force and effect (and to the Knowledge of Seller and each of the
Companies, free from any presently exercisable right of termination on the part
of the insurance company issuing such policy prior to the expiration of the term
of such policy) and all premiums due and payable in respect thereof have been
paid. There are no pending claims with respect to either of the Companies or
their properties or assets under any such insurance policy. Neither Seller nor
either of the Companies has received notice of cancellation or non-renewal of
any such policy. The transactions contemplated by this Agreement will not give
rise to a right of termination of any such policy by the insurance company
issuing the same prior to the expiration of the term of such policy.

     4.11 Litigation. Except as set forth in Section 4.11 of the Disclosure
Schedule, and except with respect to environmental matters (which are addressed
in Section 4.16 of this Agreement), there is no lawsuit, governmental
investigation or legal, administrative or arbitration action or proceeding
pending or, to the Knowledge of Seller and each of the Companies, threatened
against Seller or either of the Companies or any of their respective properties
or assets, or any director, officer or employee of either of the Companies, in
his or her capacity as such, and each of the Companies is not identified as a
party subject to any restrictions or limitations under any judgment, order or
decree of any Governmental Body.

     4.12 Condition and Sufficiency of Assets. The properties and assets owned,
leased, operated and used by each of the Companies in the conduct or operation
of its business are, taken as a whole, in good operating condition and repair,
are suitable for the purposes for which they are used and are all of the
properties and assets necessary for the conduct and operation of the businesses
of the Companies as currently conducted.

     4.13 Compliance with Law; Licenses; Customs.

     (a) Except as set forth in Section 4.13(a) of the Disclosure Schedule, each
of the Companies is and has been in compliance in all material respects with all
applicable Laws governing the conduct or operation of its business, and with all
of its Licenses. Neither of the Companies nor Seller has received any written
notice of any violation of any such Law or License, and to the Knowledge of
Seller and each of the Companies, no such violation has been threatened.

     (b) All governmental licenses, approvals, authorizations, registrations,
consents, orders, certificates, decrees, franchises and permits (collectively,
"Licenses") of each of the Companies are listed in Section 4.13(b) of the
Disclosure Schedule. The Licenses are all of the Licenses necessary for the
ownership and operation of the properties and assets of each of the Companies,
the manufacturing, marketing, sale and distribution of the Company Products by
each of the Companies and the conduct and operation of their businesses. Such
Licenses are in full force and effect, and no proceeding is pending or, to the
Knowledge of Seller and each of the Companies, threatened, seeking the

                                      -20-
<PAGE>

revocation or limitation of any such License. To the Knowledge of Seller and
each of the Companies, there exists no state of facts which could cause any
Governmental Body to limit, revoke or fail to renew any License related to or in
connection with any business as currently conducted or operated by either of the
Companies.

     (c) Except as set forth in Section 4.13(c) of the Disclosure Schedule,
neither of the Companies is the importer of record for any product.

     (d) Notwithstanding and in addition to the foregoing, each of the Companies
and, to the Knowledge of Seller and each of the Companies, the employees, agents
and representatives of each of the Companies are, and at all times have been, in
compliance in all material respects with all applicable Laws and regulations
relating to importing and exporting, customs and national and international
trade with respect to business conducted by each of the Companies or for which
either of the Companies could be held liable, including, without limitation, the
accuracy of all statements and representations made to any Governmental Body
(including the U.S. Customs Service, the U.S. Department of Homeland Security,
the U.S. Federal Trade Commission, and the U.S. Consumer Products Safety
Commission), the timely and accurate filing of all reports, schedules and forms
required to be filed with any Governmental Body and the timely and accurate
reporting and payment of all duties, taxes, fees, payments or other governmental
obligations.

     (e) Each of the Companies and, to the Knowledge of Seller and each of the
Companies, the employees, agents and representatives of each of the Companies
have not provided any assistance, directly or indirectly, to the maker of any
goods either of the Companies has imported, including, without limitation,
equipment or materials, which assistance would be subject to a duty, tax, fee or
other payment, other than such assistance which has been fully and accurately
disclosed to the appropriate Governmental Bodies and for which such duty, tax,
fee or other payment has been fully paid.

     (f) Each of the Companies and, to the Knowledge of Seller and each of the
Companies, the employees, agents and representatives of each of the Companies
have accurately prepared and maintained in all material respects all records
with respect to the business conducted by each of the Companies or for which
either of the Companies could be held liable relating to importing and
exporting, customs and international trade, as required by Law.

     (g) Section 4.13(g) of the Disclosure Schedule sets forth all liabilities
or obligations owing by either of the Companies or, to the Knowledge of Seller
and each of the Companies, the employees, agents or representatives of either of
the Companies to the U.S. Customs Service or any Governmental Body in connection
with the purchase, importation or attempted importation of any product by either
of the Companies or for which either of the Companies could be held liable,
including but not limited to: duties, taxes, fees and interest thereon;
liquidated damages; penalties; claims and assessments (whether actual or
potential and whether or not yet asserted by the U.S. Customs Service, any
Governmental Body or some third party).

     (h) Neither of the Companies nor Seller has received written notice of any
pending audits, inquiries, investigations, claims, notices or demands for

                                      -21-
<PAGE>

duties, fines, penalties, seizures, forfeitures, or liquidated damages by any
Governmental Body (including but not limited to the U.S. Customs Service, U.S.
Department of Homeland Security, U.S. Federal Trade Commission, U.S. Consumer
Products Safety Commission, U.S. Department of Justice, any Office of the U.S.
Attorney or any other agency of the U.S. government) arising out of any
transactions or importation of merchandise by or for either of the Companies
and, to the Knowledge of Seller and each of the Companies, neither of the
Companies has committed any acts or omissions which could give rise to any such
inquiry, investigation, claim, notice or demand.

     4.14 Employees.

     (a) Section 4.14(a) of the Disclosure Schedule sets forth, as of January
27, 2005, a true, correct and complete list of all of the employees, officers,
independent contractors and consultants of each of the Companies, and with
respect to each such employee, officer, independent contractor and consultant,
such individual's: (i) base salary, (ii) guaranteed bonus, (iii) 2005
discretionary bonus, (iv) all other compensation and perquisites (including,
without limitation, incentive compensation, fees or other remuneration) received
by such individual in the immediately preceding fiscal year of the applicable
Company, (v) accrued vacation, (vi) current title, (vii) date of hire, and
(viii) outstanding loans to such individuals.

     (b) Except as set forth in Section 4.14(b) of the Disclosure Schedule, each
of the Companies (i) is and has been in compliance in all material respects with
all applicable Laws (including any legal obligation to engage in affirmative
action), agreements and contracts relating to former, current, and prospective
employees, independent contractors and "leased employees" (within the meaning of
Section 414(n) of the Code) of each of the Companies, workplace practices, and
terms and conditions of employment with such Companies or retention by such
Companies, including all such Laws, agreements and contracts relating to wages,
hours, collective bargaining, employment discrimination, immigration,
disability, civil rights, fair labor standards, occupational safety and health,
workers' compensation, pay equity, wrongful discharge and violation of the
potential rights of such former, current, and prospective employees, independent
contractors and leased employees, and (ii) has timely prepared and filed all
appropriate forms (including Immigration and Naturalization Service Form I-9)
required by any relevant Law or Governmental Body. Neither of the Companies is
engaged in any unfair labor practice.

     (c) No collective bargaining agreement with respect to the business of
either of the Companies is currently in effect or being negotiated. Neither of
the Companies has any obligation to negotiate any other collective bargaining
agreement, and, to the Knowledge of Seller and each of the Companies, no
employees of either of the Companies desire to be covered by a collective
bargaining agreement.

     (d) Each of the Companies generally has good relationships with its
employees. No strike, slowdown or work stoppage is occurring or has occurred
since the inception of either of the Companies nor, to the Knowledge of Seller
and each of the Companies, is threatened or has been threatened within the
one-year period prior to the date hereof, with respect to the employees of
either of the Companies.

                                      -22-
<PAGE>

     (e) Each of the Companies has withheld for all periods all required amounts
from its employees, including, without limitation, for employee income tax
withholding, social security and unemployment taxes in compliance with
applicable law. Federal, state, local and foreign returns, as required by
applicable law, have been filed by each of the Companies for all periods for
which returns were due with respect to employee income tax withholding, social
security and unemployment taxes, and the amounts shown thereof to be due and
payable have been paid, together with any interest and penalties that are due as
a result of the failure of either of the Companies to file such returns when due
and pay when due the amounts shown thereon to be due.

     (f) Section 4.14(f) of the Disclosure Schedule accurately sets forth all
severance or continuing payment obligations of each of the Companies, as well as
all unpaid severance or continuing payments of any kind (other than pursuant to
a plan or program described in Section 4.15) which are due or claimed in writing
to be due from either of the Companies to any Person whose employment with
either of the Companies was terminated.

     (g) Section 4.14(g) of the Disclosure Schedule accurately sets forth each
of the Companies' policies with respect to accrued, but unused, vacation time.

     (h) Except as set forth in Section 4.14(h) of the Disclosure Schedule, each
employee of each of the Companies is employed on an at-will basis and neither
Seller nor either of the Companies has any written or oral agreements with any
employees of either of the Companies regarding continued employment or terms of
employment subsequent to the date hereof or the Closing Date, or which would
otherwise interfere with the ability to discharge such employees. Neither Seller
nor either of the Companies has made any written or oral statements, promises or
representations or distributed any written material to any of its shareholders,
directors, officers, employees, consultants, independent contractors, agents,
representatives or other personnel that any of such persons will continue to be
employed or engaged by either of the Companies or will receive any particular
benefits subsequent to the date hereof or the Closing Date. To the Knowledge of
Seller and each of the Companies, no key employee and no group of employees of
either of the Companies has any plans to terminate or modify their status as an
employee or employees of either of the Companies (including upon consummation of
the transactions contemplated hereby), except as contemplated by the Employment
Agreements.

     (i) Section 4.14(i) of the Disclosure Schedule contains the most recent
reports in the possession of each of the Companies with respect to the
compliance with Laws by contractors, manufacturers or suppliers of either of the
Companies. To the Knowledge of Seller and each of the Companies, except as set
forth in Section 4.14(i) of the Disclosure Schedule, no contractor, manufacturer
or supplier used by or under contract with either of the Companies is in
material violation of any Law relating to labor or employment matters.

     4.15 Employee Benefit Plans.

     (a) Section 4.15(a) of the Disclosure Schedule lists all Employee Benefit
Plans. "Employee Benefit Plan" means any "employee benefit plan" as defined in
Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended
from time to time ("ERISA") and any other plan, policy, program, practice,
agreement, understanding or arrangement (whether written or oral) providing

                                      -23-
<PAGE>

compensation or other benefits to any current or former officer, employee or
consultant (or to any dependent or beneficiary thereof), of either of the
Companies or any ERISA Affiliate, which are now, or within the last six (6)
years were, maintained by either of the Companies or any ERISA Affiliate, or
with respect to which either of the Companies or any ERISA Affiliate has or may
have any liability, including but not limited to any obligation to contribute,
including all employee pension, profit-sharing, savings, retirement, incentive,
bonus, deferred compensation, vacation, holiday, cafeteria, medical, disability,
life, accident or other insurance, stock purchase, stock option, stock
appreciation right, phantom stock, restricted stock or other equity-based
compensation plans, and any other plans, policies, programs, practices or
arrangements. "ERISA Affiliate" means any entity (whether or not incorporated)
other than either of the Companies that, together with either of the Companies,
is or could reasonably be expected to be deemed to be a member of a controlled
group of corporations within the meaning of Section 414(b) of the Code, of a
group of trades or businesses under common control within the meaning of Section
414(c) of the Code, or in the case of any Employee Benefit Plan subject to Part
3 of Subtitle B of Title I of ERISA, of an affiliated service group within the
meaning of Section 414(m) of the Code.

     (b) Each of the Companies has delivered to Madden true and complete copies
of (A) with respect to each Employee Benefit Plan, (i) such Employee Benefit
Plan including all amendments and written summaries of any unwritten plan or
amendment, and related trust agreements, insurance and other contracts
(including policies), (ii) the summary plan description and all summaries of
material modifications, and all material communications distributed to the
participants of such Employee Benefit Plan (and written summaries of any other
communications that were not written), (iii) to the extent applicable, the three
(3) most recent annual reports on Form 5500 with accompanying schedules and
attachments, (iv) to the extent applicable, the most recent IRS opinion or
determination letter, (v) to the extent applicable, audited financial statements
and actuarial valuation reports, (vi) to the extent applicable,
nondiscrimination tests performed under the Code (including 401(k) and 401(m)
tests), and (vii) forms or written communications explaining employee and
related beneficiaries rights under Part 6 of Subtitle B of Title I of ERISA and
Section 4980B of the Code ("COBRA"), or certifying group health insurance
coverage pursuant to Part 7 of Subtitle B of Title I of ERISA and Chapter 100 of
the Code ("HIPAA"); (B) any communications or election forms sent to employees
or participants in any Employee Benefit Plan or other individuals regarding
compliance with Section 409A of the Code, and a written description of any
measures that either of the Companies has taken to address Section 409A
compliance; and (C) all procedures and policies relating to the employment of
employees of either of the Companies and the use of temporary employees and
independent contractors by either of the Companies (including written summaries
of any procedures and policies that are unwritten).

     (c) Neither of the Companies nor any ERISA Affiliate maintains or
contributes to or has ever maintained or contributed to an Employee Benefit Plan
(including, without limitation, any "multiemployer plan" within the meaning of
Section 3(37) of ERISA) subject to Title IV or Section 302 of ERISA and Section
412 of the Code, and no condition exists or is reasonably likely to exist as a
result of which either of the Companies could have any liability under any such
sections.

                                      -24-
<PAGE>

     (d) No event has occurred in connection with which either of the Companies
or any Employee Benefit Plan, directly or indirectly, could be subject to any
liability under ERISA, the Code or any other Law or governmental order
applicable to any Employee Benefit Plan, or under any agreement, instrument,
statute, rule of law or regulation pursuant to or under which either of the
Companies or any ERISA Affiliate has agreed to indemnify or is required to
indemnify any person against liability incurred under, or for a violation or
failure to satisfy the requirements of, any such statute, regulation or order.

     (e) Each Employee Benefit Plan that is intended to be qualified under
Section 401(a) of the Code has received a favorable determination letter from
the IRS, has timely adopted all amendments required for continued plan
qualification and nothing has occurred and no circumstances exist that could
cause the disqualification of any such Employee Benefit Plan. Each Employee
Benefit Plan is and has been maintained in form and operation in compliance with
its terms and all applicable Laws, including, without limitation, ERISA and the
Code. As of and including the date of the Closing, each of the Companies shall
have made all contributions required to be made by it up to and including the
date of the Closing with respect to each Employee Benefit Plan, or adequate
accruals therefor will have been provided for and will be properly reflected on
the books of each of the Companies. All notices, filings and disclosures
required by ERISA and the Code (including notices under Section 4980B and
Sections 9801-9805 of the Code and Parts 6 and 7 of Subtitle B of Title I of
ERISA) have been timely made.

     (f) With respect to each Employee Benefit Plan, (i) no "party in interest"
or "disqualified person" (as defined in Section 3(14) of ERISA or Section 4975
of the Code, respectively) has at any time engaged in a transaction which could
subject Madden, either of the Companies or Seller, directly or indirectly, to a
tax, penalty or liability for prohibited transactions imposed by ERISA or the
Code and (ii) no fiduciary (as defined in Section 3(21) of ERISA) has breached
any of the responsibilities or obligations imposed upon the fiduciary under
Title I of ERISA.

     (g) Each Employee Benefit Plan may, by its terms, be amended or terminated
at any time, and no additional liabilities to either of the Companies or to such
plan will arise on account of any such termination (including, but not limited
to, retrospective premium adjustments or early cancellation penalties).

     (h) There are no actions, claims (other than routine claims for benefits),
lawsuits or arbitrations pending or threatened with respect to any Employee
Benefit Plan or against any fiduciary of any Employee Benefit Plan, and to the
Knowledge of Seller and each of the Companies, there are no facts that could
give rise to any such actions, claims, lawsuits or arbitrations.

     (i) Each Employee Benefit Plan which is a "welfare plan" within the meaning
of Section 3(1) of ERISA and which provides health, disability or death benefits
is fully insured; neither of the Companies is obligated to directly pay any such
benefits or to reimburse any third Person payor for the payment of such
benefits.

     (j) No Employee Benefit Plan provides for medical or health benefits or
coverage for any participant or any dependent or beneficiary of any participant

                                      -25-
<PAGE>

after such participant's retirement or other termination of employment, except
as may be required by COBRA or any other similar law. There has been no
communication to any person providing services to either of the Companies that
could reasonably be expected to promise or grant any such person any retiree
health or life insurance or any retiree death benefits, except as required by
COBRA or any other similar law.

     (k) No Employee Benefit Plan is a "multiple employer plan" as described in
Section 3(40) of ERISA or Section 413(c) of the Code.

     (l) Neither of the Companies has proposed, announced or agreed to create
any additional Employee Benefit Plans or to amend or modify any Employee Benefit
Plan.

     (m) The consummation of the transactions contemplated by this Agreement,
either alone or in combination with any other event, will not result in (i) any
payment (including, without limitation, severance, unemployment compensation,
golden parachute, bonus payments or otherwise) becoming due to any current or
former director, officer, employee or consultant of either of the Companies,
(ii) any increase in the amount of compensation or benefits payable in respect
of any director, officer, employee or consultant of either of the Companies,
(iii) any acceleration of the vesting or timing of payment of any benefits or
compensation payable in respect of any director, officer, employee or consultant
of either of the Companies, or (iv) any "parachute payment" under Section 280G
of the Code, whether or not such amount may be considered reasonable
compensation for personal services rendered.

     (n) There are no pending or threatened investigations by any Governmental
Body involving or relating to any Employee Benefit Plan or pending claims
(except for routine claims for benefits payable in the normal operation of the
Employee Benefit Plans), suits or proceedings against any Employee Benefit Plan,
either of the Companies, Seller, or any fiduciary or trustee of any Employee
Benefit Plan, nor, to the Knowledge of Seller and each of the Companies, are
there any facts that could give rise to any liability in the event of such
investigation, claim, suit or proceeding.

     (o) No condition exists as a result of which either of the Companies could
have any material liability, whether actual or contingent, including any
obligation under any Employee Benefit Plan, as a result of or arising out of any
misclassification of any person performing services for either of the Companies
as an independent contractor or as the employee of a third party rather than as
an employee of either of the Companies.

     (p) Section 4.15(p) of the Disclosure Schedule sets forth annual costs for
the last calendar year associated with the maintenance of each Employee Benefit
Plan, including, without limitation, annual premiums and contributions.

     (q) No Employee Benefit Plan is an employee stock ownership plan (within
the meaning of Section 4975(e)(7) of the Code) or otherwise invests in Common
Stock.

     (r) No Employee Benefit Plan covers any non-U.S. employees.

                                      -26-
<PAGE>

     (s) No Employee Benefit Plan, other than a pension or defined contribution
plan, is funded through a trust intended to be exempt from tax pursuant to
Section 501 of the Code.

     4.16 Environmental Matters. Except as set forth in Section 4.16 of the
Disclosure Schedule:

     (a) each of the Companies is and has been in compliance in all material
respects with all applicable Environmental Laws;

     (b) no Environmental Claims have been asserted against either of the
Companies or Seller, nor does either of the Companies or Seller have Knowledge
or notice of any pending or threatened Environmental Claim against either of the
Companies or Seller;

     (c) there has been no Release of a Hazardous Material at or from any real
property owned or leased by either of the Companies that would subject either of
the Companies to liability under any Environmental Law, nor has either of the
Companies or Seller received written notice that it is a potentially responsible
party under any Environmental Law; and

     (d) neither of the Companies has managed, handled, generated, manufactured,
refined, recycled, discharged, emitted, buried, processed, produced, reclaimed,
stored, treated, transported, or disposed of any Hazardous Substance, except in
compliance with all Environmental Laws.

     4.17 Bank Accounts and Powers of Attorney. Section 4.17 of the Disclosure
Schedule sets forth the name of each bank in which each of the Companies has an
account, lock box or safe deposit box, the number of each such account, lock box
and safe deposit box, and the names of all Persons authorized to draw thereon or
have access thereto. Except as set forth in Section 4.17 of the Disclosure
Schedule, no Person holds any power of attorney from either of the Companies.

     4.18 Absence of Certain Changes. Since the date of the Balance Sheet, each
of the Companies has operated its business in the ordinary course consistent
with past practice and in a commercially reasonable manner, and has maintained
its relationships with customers, vendors, suppliers, employees, agents and
others in a commercially reasonable manner, and there has not occurred any
event, development or change, and no facts or circumstances exist, which,
individually or in the aggregate, have had or could be reasonably expected to
have a Material Adverse Effect. Without limiting the generality of the
immediately preceding sentences and except as set forth in Section 4.18 of the
Disclosure Schedule, since that date, neither of the Companies has:

          (i) amended or otherwise modified its organizational documents or
     altered, through merger, liquidation, reorganization, restructuring or in
     any other fashion, its corporate structure or ownership;

          (ii) issued or sold, or authorized for issuance or sale, or granted
     any options or made other agreements, arrangements or understandings of the
     type referred to in Section 4.2(b) with respect to, any shares of its
     capital stock or any other of its securities, or altered any term of any of

                                      -27-
<PAGE>

     its outstanding securities or made any change in its outstanding shares of
     capital stock or other ownership interests or its capitalization, whether
     by reason of a reclassification, recapitalization, stock split or
     combination, exchange or readjustment of shares, stock dividend or
     otherwise;

          (iii) mortgaged, pledged or granted any security interest in any of
     its assets, except Permitted Encumbrances and security interests solely in
     tangible personal property granted pursuant to any purchase money
     agreement, conditional sales contract or capital lease under which, solely
     with respect to conditional sales contracts and capital leases, there
     exists an aggregate future liability not in excess of $50,000 per contract
     or lease (which amount was not more than the purchase price for such
     personal property and which security interest does not extend to any other
     item or items of personal property);

          (iv) declared, set aside, made or paid any dividend or other
     distribution to any holder with respect to its capital stock or other
     securities except for the distributions to Seller noted in Section 4.5(b)
     of the Disclosure Schedule;

          (v) redeemed, purchased or otherwise acquired, directly or indirectly,
     any of its capital stock or other securities;

          (vi) increased the compensation of any of its non-executive employees,
     except in the ordinary course of business consistent with past practice and
     in a commercially reasonable manner, or increased the compensation of any
     of its executive officers, except for bonuses disclosed in Section 4.5(b)
     of the Disclosure Schedule;

          (vii) adopted or, except as required by Law, amended, any Employee
     Benefit Plan;

          (viii) extended, terminated or modified any Contract, permitted any
     renewal notice period or option period to lapse with respect to any
     Contract or received any written notice of termination of any Contract,
     except for terminations of Contracts upon their expiration during such
     period in accordance with their terms;

          (ix) incurred or assumed any indebtedness for borrowed money or
     guaranteed any obligation or the net worth of any Person, except for
     endorsements of negotiable instruments for collection and the factoring of
     receivables, in each case in the ordinary course of business consistent
     with past practice and in a commercially reasonable manner;

          (x) incurred any liabilities, debts or obligations (whether absolute,
     accrued, contingent or otherwise), except for liabilities (including,
     without limitation, the factoring of receivables) incurred in the ordinary
     course of business consistent with past practice and in a commercially
     reasonable manner;

          (xi) incurred any liability, debt or obligation (whether absolute,
     accrued, contingent or otherwise) to or of any Affiliated Person, or made
     any Affiliate Loans;

                                      -28-
<PAGE>

          (xii) discharged or satisfied any Encumbrance other than those then
     required to be discharged or satisfied during such period in accordance
     with their original terms;

          (xiii) paid any obligation or liability (absolute, accrued, contingent
     or otherwise), whether due or to become due, except for any current
     liabilities and the current portion of any long term liabilities shown on
     the Financial Statements or incurred since the date of the Balance Sheet in
     the ordinary course of business consistent with past practice and in a
     commercially reasonable manner, except as noted in Section 4.5(b) of the
     Disclosure Schedule;

          (xiv) sold, transferred, leased to others or otherwise disposed of any
     assets having a fair market value in excess of $50,000, except sales of
     inventory and dispositions of obsolete assets no longer used or useful in
     the business of the Company, in each case in the ordinary course of
     business consistent with past practice and in a commercially reasonable
     manner;

          (xv) cancelled, waived or compromised any debt or claim;

          (xvi) suffered any damage or destruction to, loss of, or condemnation
     or eminent domain proceeding relating to any of its tangible properties or
     assets (whether or not covered by insurance);

          (xvii) lost the employment services of any employee whose annual
     salary exceeded $50,000;

          (xviii) made any loan or advance to any Person, other than travel and
     other similar routine advances to employees in the ordinary course of
     business consistent with past practice and in a commercially reasonable
     manner;

          (xix) purchased or acquired any capital stock or other securities of
     any other corporation or any ownership interest in any other business
     enterprise or Person;

          (xx) made capital expenditures or capital additions or betterments in
     amounts which exceeded $10,000 in the aggregate;

          (xxi) changed its method of accounting or its accounting principles or
     practices, including any policies or practices with respect to the
     establishment of reserves for work-in-process and accounts receivable,
     utilized in the preparation of the Financial Statements, other than as
     required by GAAP;

          (xxii) instituted or settled any litigation or any legal,
     administrative or arbitration action or proceeding before any court or
     Governmental Body relating to it or any of its properties or assets;

          (xxiii) made any new elections or changed any current elections with
     respect to its Taxes;

                                      -29-
<PAGE>

          (xxiv) entered into any transaction with any Affiliated Person, other
     than the Employment Agreements; (xxv) entered into any agreements,
     commitments or contracts, except those made in the ordinary course of
     business consistent with past practice and in a commercially reasonable
     manner; or

          (xxvi) entered into any agreement or commitment to do any of the
     foregoing.

     4.19 Books and Records. The books and records of each of the Companies with
respect to each of the Companies, its operations, employees and properties have
been maintained in the usual, regular and ordinary manner, all entries with
respect thereto have been accurately made in all material respects, and all
transactions involving either of the Companies have been accurately accounted
for in all material respects.

     4.20 Transactions with Affiliated Persons. Except (i) for employment
relationships between either of the Companies and employees of such Companies,
(ii) for remuneration by either of the Companies for services rendered as a
director, officer or employee of either of the Companies, or (iii) as set forth
in Section 4.20 of the Disclosure Schedule, (A) neither of the Companies has,
and has not since its inception, in the ordinary course of business consistent
with past practice or otherwise, directly or indirectly, purchased, leased or
otherwise acquired any property or obtained any services from, or sold, leased
or otherwise disposed of any property or furnished any services to, any
Affiliated Person; (B) neither of the Companies owes any amount to any
Affiliated Person, except for the reimbursement of travel, business,
entertainment and other business expenses to officers and employees of the
Company in the ordinary course of business consistent with past practice and in
accordance with the Company's existing policies and procedures; (C) no
Affiliated Person owes any amount to either of the Companies; and (D) no part of
the property or assets of any Affiliated Person is used by either of the
Companies in the conduct or operation of its business.

     4.21 Customer and Supplier Relationships.

     (a) Section 4.21(a) of the Disclosure Schedule lists the ten (10) largest
customers of each of the Companies for the fiscal years ended December 31, 2004
and 2005. Except as set forth in Section 4.21(a) of the Disclosure Schedule, to
the Knowledge of Seller and each of the Companies, there are no facts or
circumstances (including the consummation of the transactions contemplated
hereby) that are likely to result in the loss of any one customer or group of
customers of either of the Companies or a material adverse change in the
relationship of either of the Companies with such a customer or group of
customers. Each of the Companies generally has a good relationship with each of
its ten (10) largest customers.

     (b) Section 4.21(b) of the Disclosure Schedule lists the top ten (10)
largest suppliers of products to each of the Companies for the fiscal years
ended December 31, 2004 and 2005. Except as set forth in Section 4.21(b) of the
Disclosure Schedule, to the Knowledge of Seller and each of the Companies, there
are no facts or circumstances (including the consummation of the transactions
contemplated hereby) that are likely to result in the loss of any one supplier

                                      -30-
<PAGE>

or group of suppliers of either of the Companies or a material adverse change in
the relationship of either of the Companies with such a supplier or group of
suppliers. Each of the Companies generally has a good relationship with each of
its ten (10) largest suppliers.

     4.22 Absence of Certain Business Practices. Neither Seller nor either of
the Companies, nor any of their directors or officers, nor, to the Knowledge of
Seller and each of the Companies, the employees or agents of either of the
Companies, have, directly or indirectly, (a) made any contribution or gift which
contribution or gift is in violation of any applicable Law, (b) made any bribe,
rebate, payoff, influence payment, kickback or other payment to any Person,
private or public, regardless of form, whether in money, property or services
(i) to obtain favorable treatment in securing business, (ii) to pay for
favorable treatment for business secured, (iii) to obtain special concessions or
for special concessions already obtained for or in respect of either of the
Companies or any Affiliated Person of either of the Companies, or (iv) in
violation of any Law or legal requirement, or (c) established or maintained any
fund or asset of either of the Companies that has not been recorded in the books
and records of either of the Companies.

     4.23 Brokers and Finders. Except as set forth in Section 4.23 of the
Disclosure Schedule, no broker, finder or investment advisor has been engaged by
Seller or either of the Companies in connection with the transactions
contemplated by this Agreement. Seller (and not the Companies) shall be
responsible for and shall pay all fees, commissions and costs of any such
broker, finder or investment advisor.

     4.24 Restrictions on Business Activities. Except as set forth in Section
4.24 of the Disclosure Schedule, there is no judgment, injunction, order or
decree binding upon either of the Companies or Seller or, to the Knowledge of
Seller and each of the Companies, threatened, that has or could reasonably be
expected to have the effect of prohibiting or impairing the conduct of the
business of either of the Companies as currently conducted or any business
practice of either of the Companies, including the acquisition of property, the
sale of products, the provision of services, the hiring of employees, and the
solicitation of customers, in each case either individually or in the aggregate.

     4.25 Payables. Except as set forth in Section 4.25 of the Disclosure
Schedule, all accounts payable of each of the Companies have arisen in the
ordinary course of business consistent with past practice. All items which are
required by GAAP to be reflected as payables in the Financial Statements and on
the books and records of the Company are so reflected and have been recorded in
accordance with GAAP and in a commercially reasonable manner. There has been no
material adverse change since December 31, 2005 in the amount or delinquency of
accounts payable of either of the Companies, either individually or in the
aggregate.

     4.26 Receivables. Except as set forth in Section 4.26 of the Disclosure
Schedule, all accounts receivable of each of the Companies have arisen in the
ordinary course of business consistent with past practice, represent valid
obligations to each of the Companies arising from bona fide transactions, and,
to the Knowledge of Seller and each of the Companies, are not subject to claims,
set-off, or other defenses or counterclaims. All items which are required by
GAAP to be reflected as receivables in the Financial Statements and on the books
and records of either of the Companies are so reflected and have been recorded
in accordance with GAAP and in a commercially reasonable manner.

                                      -31-
<PAGE>

     4.27 Business Relations. Other than as set forth in Section 4.27 of the
Disclosure Schedule, (i) neither of the Companies is required to provide any
bonding or any other financial security arrangements in connection with any
transaction with any customer or supplier, (ii) since December 31, 2004, neither
of the Companies nor Seller has received any notice of any disruption (including
delayed deliveries or allocations by suppliers) in the availability of any
materials or products used in the business of either of the Companies, nor do
any of them have reason to believe that any such disruption will occur in
connection with the business of either of the Companies, and (iii) there are no
sole source suppliers of goods, equipment or services used by either of the
Companies (other than public utilities) with respect to which practical
alternative sources of supply are unavailable.

     4.28 Disclosure. No representation or warranty by Seller contained in this
Agreement or any Transaction Document or any statement or certificate furnished
by Seller to Madden or its representatives in connection herewith or therewith
or pursuant hereto or thereto contains any untrue statement of a material fact,
or omits to state any material fact required to make the statements herein or
therein contained, in the light of the circumstances in which they were made,
not misleading. There is no fact or circumstance known to Seller which could be
reasonably expected to have a Material Adverse Effect.

                                    ARTICLE V

                    Representations and Warranties of Madden
                    ----------------------------------------

     Madden represents and warrants to Seller as follows:

     5.1 Organization and Good Standing. Madden is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware
and has full corporate power and authority to enter into and carry out its
obligations under this Agreement.

     5.2 Authorization. The execution and delivery by Madden of this Agreement
and the other Transaction Documents to which Madden is a party have been duly
authorized by all necessary corporate action required on the part of Madden.
This Agreement and the other Transaction Documents to which Madden is a party
have been duly executed and delivered by Madden and constitute legal, valid and
binding obligations of Madden, enforceable against Madden in accordance with
their respective terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, moratorium or other laws affecting the rights
of creditors generally and by general principles of equity.

     5.3 No Conflicts; Consents. Neither the execution and delivery by Madden of
this Agreement or any of the Transaction Documents to which Madden is a party
nor the consummation by Madden of the transactions contemplated hereby or
thereby will (i) conflict with or violate the charter or by-laws of Madden, or
(ii) conflict with, violate, result in the breach of any term of, constitute a
default under or require the consent or approval of, or any notice to or filing
with any Person under, any note, mortgage, deed of trust or other agreement or
instrument to which Madden is a party or by which Madden is bound, or any Law,
writ or injunction of any Governmental Body having jurisdiction over Madden,
except with respect to clause (ii) where such conflict, violation, breach or

                                      -32-
<PAGE>

default, or the failure to obtain such consent or approval, give such notice or
make such filing, would not materially adversely impair the ability of Madden to
consummate the transactions contemplated hereby.

     5.4 Litigation. No lawsuit, governmental investigation or legal,
administrative, or arbitration action or proceeding is pending or, to the
Knowledge of Madden, threatened against Madden, or any director, officer or
employee of Madden in his or her capacity as such, which questions the validity
of this Agreement or seeks to prohibit, enjoin or otherwise challenge the
consummation of the transactions contemplated hereby.

     5.5 Brokers and Finders. Except as set forth in Section 5.5 of the Madden
Disclosure Schedule, no broker, finder or financial advisor has been engaged by
Madden in connection with the transactions contemplated by this Agreement.
Madden shall be responsible for and shall pay all fees, commissions and costs of
any such broker, finder or financial advisor.

     5.6 Investment Intent. Madden is acquiring all of the Company Shares for
its own account and for investment purposes and not with a view to the sale or
other distribution of any of the Company Shares.

                                   ARTICLE VI

                               Covenants of Seller
                               -------------------

     Seller hereby covenants and agrees as follows:

     6.1 Ordinary Course. From the date hereof until the Closing, other than as
contemplated by this Agreement or as set forth in Section 6.1 of the Disclosure
Schedule, Seller will (a) cause each of the Companies to (i) maintain its
corporate existence in good standing, (ii) maintain in effect all of its
presently existing insurance coverage (or substantially equivalent insurance
coverage), preserve its business organization substantially intact, use good
faith commercially reasonable efforts to keep the services of its present
principal employees and preserve its present business relationships with its
material suppliers and customers, (iii) maintain the lines of business of each
of the Companies, and (iv) in all respects conduct its business in the usual and
ordinary course consistent with past practice and in a commercially reasonable
manner, without a material change in current operational policies, subject, in
each case, to the restrictions set forth in Section 6.2, and (b) permit Madden,
its accountants, its legal counsel and its other representatives reasonable
access to the management, accountants, legal counsel, minute books and stock
transfer records, other books and records, contracts, agreements, properties and
operations of each of the Companies at all reasonable times upon reasonable
notice (provided that all such parties shall be subject to the terms of the
Confidentiality Agreement).

     6.2 Conduct of Business. From the date hereof until the Closing, other than
as contemplated by this Agreement or as set forth in Section 6.2 of the
Disclosure Schedule, Seller will cause each of the Companies not to do any of
the following without the prior written consent of Madden:

                                      -33-
<PAGE>

          (i) amend or otherwise modify its organizational documents or alter,
     through merger, liquidation, reorganization, restructuring or in any other
     fashion, its corporate structure or ownership;

          (ii) other than pursuant to Section 2.1, issue or sell, or authorize
     for issuance or sale, or grant any options or make other agreements,
     arrangements or understandings of the type referred to in Section 4.2(b)
     with respect to, any shares of its capital stock or any other of its
     securities, or alter any term of any of its outstanding securities or make
     any change in its outstanding shares of capital stock or other ownership
     interests or its capitalization, whether by reason of a reclassification,
     recapitalization, stock split or combination, exchange or readjustment of
     shares, stock dividend or otherwise;

          (iii) mortgage, pledge or grant any security interest in any of its
     assets, except Permitted Encumbrances and security interests solely in
     tangible personal property granted pursuant to any purchase money
     agreement, conditional sales contract or capital lease under which, solely
     with respect to conditional sales contracts and capital leases, there
     exists an aggregate future liability not in excess of $50,000 per contract
     or lease (which amount is not more than the purchase price for such
     personal property and which security interest does not extend to any other
     item or items of personal property);

          (iv) declare, set aside, make or pay any dividend or other
     distribution to any holder with respect to its capital stock or other
     securities except as disclosed in Section 4.5(b) of the Disclosure
     Schedule;

          (v) redeem, purchase or otherwise acquire, directly or indirectly, any
     of its capital stock or other securities;

          (vi) increase the compensation of any of its non-executive employees,
     except in the ordinary course of business consistent with past practice and
     in a commercially reasonable manner, or increase the compensation of any of
     its executive officers;

          (vii) adopt or, except as otherwise required by Law, amend, any
     Employee Benefit Plan or enter into any collective bargaining agreement;

          (viii) extend, terminate or modify any Contract or permit any renewal
     notice period or option period to lapse with respect to any Contract,
     except for terminations of Contracts upon their expiration during such
     period in accordance with their terms;

          (ix) incur or assume any indebtedness for borrowed money or guarantee
     any obligation or the net worth of any Person, except for endorsements of
     negotiable instruments for collection and the factoring of receivables, in
     each case in the ordinary course of business consistent with past practice;

          (x) incur any liabilities, debts or obligations (whether absolute,
     accrued, contingent or otherwise), except for liabilities (including,

                                      -34-
<PAGE>

     without limitation, the factoring of receivables) incurred in the ordinary
     course of business consistent with past practice and in a commercially
     reasonable manner;

          (xi) incur any liability, debt or obligation (whether absolute,
     accrued, contingent or otherwise) to or of any Affiliated Person, or make
     any Affiliate Loans;

          (xii) discharge or satisfy any Encumbrance other than those which are
     required to be discharged or satisfied during such period in accordance
     with their original terms;

          (xiii) pay any obligation or liability (absolute, accrued, contingent
     or otherwise), whether due or to become due, except for any current
     liabilities, and the current portion of any long term liabilities shown on
     the Financial Statements or incurred since the date of the Balance Sheet in
     the ordinary course of business consistent with past practice and in a
     commercially reasonable manner;

          (xiv) sell, transfer, lease to others or otherwise dispose of any of
     its properties or assets having a fair market value in excess of $50,000,
     except sales of inventory and dispositions of obsolete assets no longer
     used or useful in its business, in each case in the ordinary course of
     business consistent with past practice and in a commercially reasonable
     manner;

          (xv) cancel, waive or compromise any debt or claim;

          (xvi) make any loan or advance to any Person, other than travel and
     other similar routine advances to employees in the ordinary course of
     business consistent with past practice and in a commercially reasonable
     manner;

          (xvii) purchase or acquire any capital stock or other securities of
     any other corporation or any ownership interest in any other business
     enterprise or Person;

          (xviii) make capital expenditures or capital additions or betterments
     in amounts which exceed $5,000 in the aggregate;

          (xix) change its method of accounting or its accounting principles or
     practices, including any policies or practices with respect to the
     establishment of reserves for work-in-process, inventory and accounts
     receivable, utilized in the preparation of the Financial Statements, other
     than as required by GAAP;

          (xx) institute or settle any litigation or any legal, administrative
     or arbitration action or proceeding before any court or Governmental Body
     relating to it or any of its properties or assets;

          (xxi) make any settlements or new elections, or change any current
     elections, with respect to its Taxes;

          (xxii) enter into any agreements, commitments or contracts for any
     real property leases;

                                      -35-
<PAGE>

          (xxiii) enter into any transaction with any Affiliated Person, other
     than the Employment Agreements;

          (xxiv) enter into any other agreements, commitments or contracts,
     except those made in the ordinary course of business consistent with past
     practice and in a commercially reasonable manner; or

          (xxv) enter into any agreement or commitment to do any of the
     foregoing.

     6.3 Certain Filings. Seller agrees to make or cause to be made all filings
with Governmental Bodies that are required to be made by Seller or by either of
the Companies to carry out the transactions contemplated by this Agreement,
including as required under any applicable anti-competition Law. Seller agrees
to assist, and to cause each of the Companies to assist, Madden in making all
such filings, applications and notices as may be necessary or desirable in order
to obtain the authorization, approval or consent of any Governmental Body which
may be reasonably required of Madden or which Madden may reasonably request in
connection with the consummation of the transactions contemplated hereby,
including as required under any applicable anti-competition Law.

     6.4 Consents and Approvals. Seller agrees to use its good faith
commercially reasonable efforts to obtain, or to cause each of the Companies to
obtain, as promptly as practicable, but not later than the Closing in any event,
all consents, authorizations, approvals and waivers required in connection with
the consummation of the transactions contemplated by this Agreement.

     6.5 Efforts to Satisfy Conditions. Seller agrees to use its good faith
commercially reasonable efforts to satisfy the conditions set forth in Article
IX.

     6.6 Further Assurances. Seller agrees to execute and deliver, and to cause
each of the Companies to execute and deliver, such additional documents and
instruments, and to perform such additional acts as Madden may reasonably
request to effectuate or carry out and perform all the terms, provisions and
conditions of this Agreement and the other Transaction Documents and the
transactions contemplated hereby and thereby and to effectuate the intent and
purposes hereof.

     6.7 Notification of Certain Matters. Promptly after obtaining knowledge
thereof, Seller shall notify Madden in writing of (a) the occurrence or
non-occurrence of any fact or event which causes or would be reasonably likely
to cause (i) any representation or warranty of Seller contained in this
Agreement to be untrue or inaccurate in any material respect at any time from
the date hereof to the Closing Date or (ii) any covenant, condition or agreement
of Seller in this Agreement not to be complied with or satisfied in any material
respect, and (b) any failure of Seller to comply with or satisfy any covenant,
condition or agreement to be complied with or satisfied by Seller hereunder in
any material respect; provided, however, that no such notification shall affect
the representations or warranties of Seller, or the right of Madden to rely
thereon, or the conditions to the obligations of Madden except as provided in
the following sentence. If Seller notifies Madden in writing of any matter

                                      -36-
<PAGE>

referred to in the preceding clause (a)(i) or (ii) and Madden nevertheless
consummates the transactions contemplated hereby, Madden shall have no claim
against Seller for a breach of such representation or warranty, or covenant,
condition or agreement, as applicable, based on the information contained in
such notification and the provisions of Section 12.2 shall not apply with
respect to any such matter. Seller shall give prompt notice in writing to Madden
of any notice or other communication from any third party alleging that the
consent of such third party is or may be required to be obtained by Seller or
either of the Companies in connection with the transactions contemplated by this
Agreement.

                                   ARTICLE VII

                               Covenants of Madden
                               -------------------

     Madden hereby covenants and agrees as follows:

     7.1 Certain Filings. Madden agrees to make or cause to be made all filings
with Governmental Bodies that are required to be made by Madden or its
affiliates to carry out the transactions contemplated by this Agreement,
including as required under any applicable anti-competition Law. Madden agrees
to assist Seller in making all such filings, applications and notices as may be
necessary or desirable in order to obtain the authorization, approval or consent
of any Governmental Body which may be reasonably required of Seller or which
Seller may reasonably request in connection with the consummation of the
transactions contemplated hereby, including as required under any applicable
anti-competition Law.

     7.2 Efforts to Satisfy Conditions. Madden agrees to use its good faith
commercially reasonable efforts to satisfy the conditions set forth in Article X
hereof that are within its control.

     7.3 Further Assurances. Madden agrees to execute and deliver such
additional documents and instruments, and to perform such additional acts, as
Seller may reasonably request to effectuate or carry out and perform all the
terms, provisions and conditions of this Agreement and the other Transaction
Documents and the transactions contemplated hereby and thereby and to effectuate
the intent and purposes hereof.

     7.4 Notification of Certain Matters. Promptly after obtaining knowledge
thereof, Madden shall notify Seller of (a) the occurrence or non-occurrence of
any fact or event which causes or would be reasonably likely to cause (i) any
representation or warranty of Madden contained in this Agreement to be untrue or
inaccurate in any material respect at any time from the date hereof to the
Closing Date or (ii) any covenant, condition or agreement of Madden in this
Agreement not to be complied with or satisfied in any material respect and (b)
any failure of Madden to comply with or satisfy any covenant, condition or
agreement to be complied with or satisfied by it hereunder in any material
respect; provided, however, that no such notification shall affect the
representations or warranties of Madden or Seller's right to rely thereon, or
the conditions to the obligations of Seller except as provided in the following
sentence. If Madden notifies Seller in writing of any matter referred to in the
preceding clause (a)(i) or (ii) and Seller nevertheless consummates the
transactions contemplated hereby, Seller shall have no claim against Madden for
a breach of such representation or warranty, or covenant, condition or

                                      -37-
<PAGE>

agreement, as applicable, based on the information contained in such
notification and the provisions of Section 12.3 shall not apply with respect to
any such matter. Madden shall give prompt notice in writing to Seller of any
notice or other communication from any third party alleging that the consent of
such third party is or may be required to be obtained by Madden in connection
with the transactions contemplated by this Agreement.

     7.5 Indemnification . Madden shall indemnify and hold harmless Seller from
and against any Loss incurred or suffered by Seller as a result of or arising
from Seller's (a) limited personal guaranty under that certain Factoring
Agreement, dated June 19, 1995, as amended, between DMFA and Wells Fargo
Century, Inc. and (b) personal guarantees under the Leases, dated January 7,
2004, and June 22, 2004, respectively, with Ten West Thirty Third Associates
with respect to Rooms 600 and 601, respectively, at 4-16 West 33rd Street, New
York, New York.

                                  ARTICLE VIII

                            Certain Other Agreements
                            ------------------------

     8.1 Certain Tax Matters. The parties hereby further covenant and agree as
follows:

     (a) Tax Returns and Cooperation.

          (i) Seller shall, or shall use good faith commercially reasonable
     efforts to cause each of the Companies to, prepare and timely file, in a
     commercially reasonable manner, (x) all Returns and amendments thereto
     required to be filed by or for each of the Companies for all taxable
     periods ending on or before the Closing Date. Madden will be given a
     reasonable opportunity to review and comment on all such Returns required
     to be filed after the date hereof.

          (ii) Seller shall be liable for all Taxes of each of the Companies for
     the Pre-Closing Period except for any Taxes that will result by reason of a
     338(h)(10) Election or analogous elections made pursuant to Section 8.1(b)
     (with respect to which Madden will be liable), and all Taxes of Seller for
     any taxable year or taxable period. Notwithstanding the foregoing, in the
     case of any taxable period that includes (but does not begin or end on) the
     Closing Date (a "Straddle Period"), the portion of the Taxes of each of the
     Companies for such Straddle Period attributable to the period prior to
     close of the Closing Date shall be treated as Taxes of a Pre-Closing Period
     for purposes of this Section 8.1(a)(ii). The amount of Straddle Period
     Taxes of each of the Companies that are treated as Taxes of a Pre-Closing
     Period shall be computed (x) in the case of income, franchise, sales, or
     similar taxes, pursuant to an interim closing of the books method by
     assuming that each of the Companies had a taxable year or period which
     ended on the Closing Date, except that exemptions, allowances or deductions
     that are calculated on an annual basis, such as the deduction for
     depreciation, shall be apportioned on a per-diem basis and (y) in the case
     of real property Taxes, personal property taxes and similar ad valorem
     obligations by prorating such Taxes owed for the Straddle Period on a
     per-diem basis.

                                      -38-
<PAGE>

          (iii) Each of the Companies shall be liable for any and all Taxes
     imposed on either of the Companies relating to or apportioned to any
     taxable year or portion thereof beginning on or after the Closing Date and
     ending after the Closing Date.

          (iv) Madden and Seller shall each cooperate fully, as and to the
     extent reasonably requested by the other party, in connection with the
     filing of Returns pursuant to this Section 8.1(a) and any audit, litigation
     or other proceeding with respect to Taxes. Such cooperation shall include
     the retention and (upon the other party's request) the provision of records
     and information which are reasonably relevant to any such audit, litigation
     or other proceeding and making employees available on a mutually convenient
     basis to provide additional information and explanation of any material
     provided hereunder. Seller (before the Closing) and Madden (after the
     Closing) shall each cause each of the Companies (A) to retain all books and
     records with respect to Tax matters pertinent to it relating to any taxable
     period beginning before the Closing Date until the expiration of the
     statutory period of limitations of the respective taxable periods, and to
     abide by all record retention agreements entered into with any taxing
     authority, and (B) to give the other party reasonable written notice prior
     to transferring, destroying or discarding any such books and records.

          (v) Madden and Seller further agree, upon request, to use good faith
     commercially reasonable efforts to obtain any certificate or other document
     from any Governmental Body or any other Person as may be necessary to
     mitigate, reduce or eliminate any Tax that could be imposed (including, but
     not limited to, with respect to the transactions contemplated hereby);
     provided that such certificate or other document does not increase the Tax
     of Madden or Seller.

     (b) 338(h)(10) Election.

          (i) At the request of Madden, Madden and Seller shall timely make a
     joint election under Section 338(h)(10) of the Code (a "338(h)(10)
     Election") with respect to the purchase of the shares of DMFA. Madden and
     Seller shall, at the request of Madden, make any analogous election with
     respect to state, local or foreign Taxes, to the extent that such election
     is separately available. Madden and Seller shall exchange completed and
     executed copies of (A) IRS Form 8023 and required schedules thereto and (B)
     to the extent required, any similar forms with respect to state, local or
     foreign Taxes, which shall in each case be completed in a manner consistent
     with the Final Allocation (as defined below), as soon after the preparation
     of the Final Allocation as is reasonably practicable.

          (ii) Unless Madden determines that it will not make a 338(h)(10)
     Election and provides to Seller written notice thereof, Madden shall,
     within sixty (60) days of the Closing, determine and provide to Seller the
     allocation of the purchase price, as determined for United States federal
     income Tax purposes, among the assets deemed acquired for United States
     federal income Tax purposes assuming a 338(h)(10) Election were made with
     respect to the DMFA shares (the "Final Allocation"). The Final Allocation
     shall be made in accordance with the Code and any applicable Treasury
     Regulations. The Final Allocation shall be redetermined, consistent with
     the principles set forth above, upon the happening of any event reasonably

                                      -39-
<PAGE>

     requiring such redetermination, including, without limitation, any
     adjustments to taxable income, post-closing adjustments pursuant to Section
     2.3(b) and the payment to Seller of the Earn-Out Payment pursuant to the
     Earn-Out Agreement. The Final Allocation, once determined, shall be annexed
     to this Agreement as Exhibit G, and any redetermination of the Final
     Allocation pursuant to the preceding sentence shall likewise be annexed to
     this Agreement with an appropriate designation. The Final Allocation (and
     any redetermination thereof) shall be binding on Seller and Madden for all
     Tax and financial reporting purposes.

          (iii) Notwithstanding anything herein to the contrary, Madden shall
     reimburse Seller for the increased Taxes, if any, and Seller shall pay to
     Madden the amount of the decreased Taxes, if any, incurred by Seller with
     respect to the year in which the Closing occurs and/or any subsequent year
     as a result of any 338(h)(10) Election or analogous elections made (taking
     into account the Final Allocation) such that Seller will receive the same
     after-tax proceeds with respect to the year in which the Closing occurs
     and/or any subsequent year as if Seller had sold stock and no 338(h)(10)
     Election or analogous elections had been made. Within thirty (30) days
     after determination of the Final Allocation, Seller shall provide to Madden
     a schedule, with supporting workpapers, which shall be based upon the Final
     Allocation, setting forth (A) the amount of Taxes incurred by Seller with
     respect to the year in which the Closing occurs from the sale of the
     Company Shares with respect to which a 338(h)(10) Election or analogous
     election is made and (B) the amount of Taxes that would have been incurred
     by Seller with respect to the year in which the Closing occurs from the
     sale of such Company Shares determined as if no such election were made. In
     the event that Madden's payment to Seller or Seller's payment to Madden
     occur (or will occur) after the end of the year in which the Closing occurs
     (including the years in which the Earn-Out Payment is made), then Seller
     shall provide Madden with a recomputed schedule, with supporting
     workpapers, setting forth the amount of any additional or reduced Taxes
     incurred by Seller with respect to such year following the year in which
     the Closing occurs as a result of a 338(h)(10) Election or any analogous
     election. Unless Madden disputes the schedule by providing written notice
     to Seller within thirty (30) days of the receipt thereof, Seller's schedule
     shall be final, binding and conclusive on the parties for all Tax purposes.
     If Madden and Seller cannot agree on the proper amount that Madden is
     required to pay Seller, or Seller is required to pay Madden, pursuant to
     this Section 8.1(b)(iii) within thirty (30) days of the provision of
     written notice to Seller, such dispute shall be settled, within thirty (30)
     days of its submission, by the Independent Accounting Firm selected in the
     manner set forth in Article I hereof, and the amount that the Independent
     Accounting Firm determines is required to be paid pursuant to this Section
     8.1(b)(iii) shall be final, binding and conclusive on the parties for all
     Tax purposes. Madden and Seller shall submit the dispute to the Independent
     Accounting Firm within twenty (20) days of the receipt by Seller of the
     written objection. Seller's schedule and the determination of any amounts
     required to be paid pursuant to this Section 8.1(b)(iii) shall be
     consistent with and based upon, inter alia, the principles, statements and,
     if applicable, assumptions set forth in Exhibit G-1 attached hereto, which
     shall also be applied by the Independent Accounting Firm in settling any
     dispute hereunder. It is understood and agreed among the parties that any
     amount paid in excess of the amounts due and owing pursuant to this Section

                                      -40-
<PAGE>

     8.1(b) shall be promptly repaid. Madden and Seller shall pay the amounts
     required to be paid pursuant to this Section 8.1(b)(iii) on or before the
     date Seller is required to pay the increased or decreased Taxes as a result
     of the 338(h)(10) Election or analogous election, provided, however, that
     Seller shall not be required to pay any amounts required to be paid by
     Seller to Madden pursuant to this Section 8.1(b)(iii) with respect to any
     decreased interest under Section 453A of the Code as a result of the
     338(h)(10) Election or analogous election until the first year in which the
     Earn-Out Payment is made, such payment obligation accruing until such year.

          (iv) In addition to the foregoing, Madden shall reimburse Seller for
     any reasonable documented out-of-pocket professional fees and expenses
     incurred by Seller in connection with determining the parties' obligations,
     if any, under clause (iii) above.

          (v) Madden shall promptly provide written notice to Seller of any
     audit or other investigation that may be initiated in connection with a
     338(h)(10) Election or any analogous election.

                                   ARTICLE IX

                  Conditions Precedent to Obligations of Madden
                  ---------------------------------------------

     The obligations of Madden under Article II and Article III shall be subject
to the satisfaction at or prior to the Closing of the following conditions, any
one or more of which may be waived by Madden:

     9.1 Representations and Warranties. Each and every representation and
warranty of Seller contained in this Agreement, and any schedule or any
certificate delivered pursuant hereto, shall have been true and correct when
made and shall be repeated at the Closing and (a) if qualified by materiality
(or any variation of such term), shall be true and correct (as so qualified) as
of the Closing Date, except that any such representation or warranty that is
made as of a specified date shall only be required to be true and correct as of
that date, and (b) if not qualified by materiality (or any variation of such
term), shall be true and correct in all material respects as of the Closing
Date, except that any such representation or warranty that is made as of a
specified date shall only be required to be true and correct in all material
respects as of that date.

     9.2 Compliance with Covenants. Seller shall have performed and observed in
all material respects all covenants and agreements to be performed or observed
by Seller under this Agreement at or before the Closing.

     9.3 Lack of Adverse Change. Since the date of the Balance Sheet, there has
not occurred any circumstance or event which, individually or in the aggregate,
has had or is reasonably likely to result in a Material Adverse Effect,
including a material decrease in the revenue of either of the Companies (other
than decreases solely attributable to normal seasonal variations for the
respective Companies).

     9.4 Update Certificate. Madden shall have received a favorable certificate,
dated the Closing Date, signed by Seller as to the matters set forth in Sections
9.1, 9.2 and 9.3.

                                      -41-
<PAGE>

     9.5 Legal Opinion. Madden shall have received the opinion of Wechsler &
Cohen, LLP, counsel to Seller, dated the Closing Date, substantially in the form
attached hereto as Exhibit H.

     9.6 Regulatory Approvals. All material approvals and consents of
Governmental Bodies required to carry out the transactions contemplated by this
Agreement, including approvals under any applicable anti-competition Laws, shall
have been obtained.

     9.7 Consents of Third Parties. All consents from third parties to Contracts
or otherwise that are required to be listed in Section 4.4 of the Disclosure
Schedule in order to avoid a misrepresentation under Section 4.4 shall have been
obtained in writing.

     9.8 No Violation of Orders. No preliminary or permanent injunction or other
order issued by any Governmental Body, nor any statute, rule, regulation, decree
or executive order promulgated or enacted by any Governmental Body, that
declares this Agreement invalid or unenforceable in any material respect or that
prevents or delays the consummation of the transactions contemplated hereby or
which imposes or will impose restrictions on Madden's right or ability to
operate the business of either of the Companies shall be in effect; and no
action or proceeding before any Governmental Body shall have been instituted or,
to the Knowledge of Seller and each of the Companies, threatened by any
Governmental Body, or by any other Person, which seeks to prevent or delay the
consummation of the transactions contemplated by this Agreement or which
challenges the validity or enforceability of this Agreement or which seeks to
impose restrictions on Madden's right or ability to operate the business of
either of the Companies, or seeks to require Madden to dispose of any of its
businesses, operations, properties or assets or any claim relating to the equity
of either of the Companies.

     9.9 Employment Agreements. DMFA and each of Seller, KH, SL and RC shall
have entered into the Employment Agreements, and the Employment Agreements shall
be in full force and effect with no notice that any of Seller, KH, SL or RC do
not intend to honor such Employment Agreements.

     9.10 Transaction Documents. Each of the Companies and Seller shall have
entered into each of the other Transaction Documents to which they are a party.

     9.11 License Agreement. The License Agreement shall have been terminated by
the mutual agreement of the parties thereto.

     9.12 Other Closing Matters. Madden shall have received such other
supporting information in confirmation of the representations, warranties,
covenants and agreements of Seller and the satisfaction of the conditions to
Madden's obligation to close hereunder as Madden or its counsel may reasonably
request.

                                      -42-
<PAGE>

                                    ARTICLE X

                  Conditions Precedent to Obligations of Seller
                  ---------------------------------------------

     The obligations of Seller under Article II and Article III shall be subject
to the satisfaction at or prior to the Closing of the following conditions, any
one or more of which may be waived by Seller:

     10.1 Representations and Warranties. Each and every representation and
warranty of Madden contained in this Agreement, and any schedule or any
certificate delivered pursuant hereto, shall have been true and correct when
made and shall be repeated at the Closing and (a) if qualified by materiality
(or any variation of such term), shall be true and correct (as so qualified) as
of the Closing Date, except that any such representation or warranty that is
made as of a specified date shall only be required to be true and correct as of
that date, and (b) if not qualified by materiality (or any variation of such
term), shall be true and correct in all material respects as of the Closing
Date, except that any such representation or warranty that is made as of a
specified date shall only be required to be true and correct in all material
respects as of that date.

     10.2 Compliance with Covenants. Madden shall have performed and observed in
all material respects all covenants and agreements to be performed or observed
by it under this Agreement at or before the Closing.

     10.3 Update Certificate. Seller shall have received a favorable
certificate, dated the Closing Date, signed by Madden as to the matters set
forth in Sections 10.1 and 10.2.

     10.4 Regulatory Approvals. All material approvals and consents of
Governmental Bodies required to carry out the transactions contemplated by this
Agreement, including approvals under any applicable anti-competition Laws, shall
have been obtained.

     10.5 No Violation of Orders. No preliminary or permanent injunction or
other order issued by any Governmental Body, nor any statute, rule, regulation,
decree or executive order promulgated or enacted by any Governmental Body, that
declares this Agreement invalid or unenforceable in any material respect or that
prevents the consummation of the transactions contemplated hereby shall be in
effect.

     10.6 Transaction Documents. Madden shall have entered into each of the
other Transaction Documents to which it is a party.

     10.7 Legal Opinion. Seller shall have received the opinion of Kramer Levin
Naftalis & Frankel LLP, counsel to Madden, dated the Closing Date, substantially
in the form attached hereto as Exhibit I.

     10.8 License Agreement. The License Agreement shall have been terminated by
the mutual agreement of the parties thereto.

     10.9 Other Closing Matters. Seller shall have received such other
supporting information in confirmation of the representations, warranties,

                                      -43-
<PAGE>

covenants and agreements of Madden and the satisfaction of the conditions to
Seller's obligations to close hereunder as Seller or its counsel may reasonably
request.

                                   ARTICLE XI

                            Termination of Agreement
                            ------------------------

     11.1 Conditions for Termination. This Agreement may be terminated:

     (a) at any time prior to the Closing by mutual consent of Madden and
Seller;

     (b) by Madden if the Closing shall not have been consummated by forty-five
(45) days after the date hereof, unless such failure of consummation shall be
due to a material breach of any representation or warranty, or the
nonfulfillment in any material respect, and failure to cure such nonfulfillment
as set forth in clause (d) below, of any covenant or agreement contained herein
on the part of Madden; or

     (c) by Seller if the Closing shall not have been consummated by forty-five
(45) days after the date hereof, unless such failure of consummation shall be
due to a material breach of any representation or warranty, or the
nonfulfillment in any material respect, and failure to cure such nonfulfillment
as set forth in clause (d) below, of any covenant or agreement contained herein
on the part of Seller; or

     (d) by Madden or Seller if the other party fails to cure a material breach
of any provision of this Agreement within fifteen (15) days after its receipt of
written notice of such breach from the non-breaching party, provided, however,
that a party shall not be entitled to terminate this Agreement pursuant to this
Section 11.1(d) if it is also in material breach of any provision of this
Agreement.

     11.2 Effect of Termination. Upon the termination of this Agreement for any
reason, Madden and Seller shall have no liability or further obligations arising
out of this Agreement, except for any liability resulting from any intentional
breach of a representation, warranty or covenant contained in this Agreement
prior to termination. Furthermore, the provisions of Sections 4.23, 5.5, this
Section 11.2 and Article XIII shall survive any termination of this Agreement.

                                   ARTICLE XII

                                 Indemnification
                                 ---------------

     12.1 Survival of Representations, Warranties and Covenants. The parties to
this Agreement hereby agree that the remedy for any breach of a representation
or warranty, covenant or agreement contained in this Agreement shall be the
indemnification provisions set out in this Article XII; provided, however, that
nothing in this Section 12.1 shall prohibit any party from seeking specific
performance or injunctive relief against any other party in respect of a breach
by such other party of any covenant hereunder; and provided further, that
nothing in this Section 12.1 shall limit any party's remedies for a breach of a
covenant occurring prior to the Closing.

                                      -44-
<PAGE>

     (a) The representations and warranties of the parties contained in this
Agreement, any schedule or any certificate delivered pursuant hereto, shall
survive the Closing and shall continue in full force and effect (a) in the case
of the representations and warranties of Seller and Madden contained in Sections
4.6, 4.15, 4.16, 4.23 and 5.5 until thirty (30) days following the expiration of
the applicable statutory period of limitations with respect to the matter to
which the claim relates, as such limitation period may be extended from time to
time, (b) in the case of the representations and warranties of Seller and Madden
contained in Sections 4.1, 4.2, 4.3, 4.20, 5.1 and 5.2, indefinitely, and (c) in
the case of all other representations and warranties of the parties contained in
this Agreement, and in any schedule or any certificate delivered pursuant
hereto, until twenty-four (24) months after the Closing Date. Each party hereto
shall be entitled to rely on any such representation or warranty regardless of
any independent knowledge of such party or any inquiry or investigation made by
or on behalf of such party. Notwithstanding the foregoing, any representation or
warranty in respect of which indemnity may be sought hereunder shall survive the
time at which it would otherwise terminate pursuant to this Section 12.1 if
notice of the breach thereof shall have been given to the party against whom
such indemnity may be sought prior to the expiration of the applicable survival
period.

     (b) The parties' covenants and agreements under this Agreement shall
survive the Closing indefinitely unless a shorter period of performance is
specified with respect to such covenant or agreement.

     12.2 Indemnification by Seller.

     (a) Subject to Section 12.2(b), Seller shall indemnify and hold harmless
Madden, each of the Companies, and each of their respective stockholders,
directors, officers, employees, agents and representatives, and the successors
and assigns of each of the foregoing (collectively, the "Madden Indemnified
Parties") from and against any Loss incurred or suffered by such Person as a
result of or arising from, without duplication:

          (i) a breach by Seller of any representation or warranty made by
     Seller in this Agreement, the Earn-Out Agreement or any schedule or
     certificate delivered pursuant hereto or thereto; and

          (ii) a failure by Seller to perform or comply with any covenant or
     agreement on the part of Seller contained herein or in the Earn-Out
     Agreement.

Any amount paid pursuant to this Section 12.2(a) shall be paid to Madden or, at
Madden's election, to a Company or the Companies and shall be the amount
required to put Madden or the Companies, as the case may be, in the position it
or they would have been in had such representation, warranty, covenant or
agreement not been breached.

     (b) Notwithstanding Section 12.2(a):

          (i) Seller shall not have any obligation to indemnify the Madden
     Indemnified Parties from and against any Loss under clause (i) of Section
     12.2(a) until the Madden Indemnified Parties have suffered aggregate
     Losses, by reason of all such breaches, in excess of one hundred fifty
     thousand dollars ($150,000); provided that such threshold shall not apply

                                      -45-
<PAGE>

     to any Loss as a result of, arising from or in connection with a breach by
     Seller of a representation or warranty contained in Sections 4.1, 4.2, 4.3,
     4.6, 4.20 or 4.23; and

          (ii) Seller shall not have any obligation to indemnify the Madden
     Indemnified Parties from and against any Loss under clause (i) of Section
     12.2(a) to the extent the aggregate Losses the Indemnified Parties have
     suffered by reason of all such breaches exceed fourteen million dollars
     ($14,000,000), plus any amounts earned by Seller pursuant to the Earn-Out
     Agreement; provided that such aggregate limit shall not apply to any Loss
     as a result of, arising from or in connection with a breach by Seller of a
     representation or warranty contained in Sections 4.1, 4.2, 4.3, 4.6, 4.20
     or 4.23.

     (c) Notwithstanding anything to the contrary contained in Section 12.2(b)
or anywhere else in this Agreement, Seller shall indemnify and hold harmless the
Madden Indemnified Parties, without limitation, from and against any and all
Losses incurred or suffered by such Person after the Closing Date as a result of
or arising from any fraudulent act or willful or intentional misconduct by
either of the Companies prior to the Closing Date or by Seller.

     12.3 Indemnification by Madden.

     (a) Madden shall indemnify and hold harmless Seller and each of his agents
and representatives, and the successors and assigns of each of the foregoing
(the "Seller Indemnified Parties"), from and against any Loss incurred or
suffered by such Person as a result of or arising from:

          (i) a breach by Madden of any representation or warranty made by
     Madden in this Agreement, the Earn-Out Agreement or in any schedule or
     certificate delivered pursuant hereto or thereto; and

          (ii) a failure by Madden to perform or comply with any covenant or
     agreement on the part of Madden contained herein or in the Earn-Out
     Agreement.

Any amount paid pursuant to this Section 12.3(a) shall be the amount required to
put Seller in the position Seller would have been in had such representation,
warranty, covenant or agreement not been breached.

     (b) Notwithstanding anything to the contrary contained in this Agreement,
Madden shall indemnify and hold harmless the Seller Indemnified Parties from and
against any Loss incurred or suffered by Seller after the Closing Date as a
result of or arising from any fraudulent act or willful misconduct by Madden.

     12.4 Assumption of Defense. An indemnified party shall promptly give notice
to each indemnifying party after obtaining knowledge of any matter as to which
recovery may be sought against such indemnifying party because of the indemnity
set forth above, and, if such indemnity shall arise from the claim of a third
party, shall permit such indemnifying party to assume the defense of any such
claim or any proceeding resulting from such claim; provided, however, that
failure to give any such notice promptly shall not affect the indemnification
provided under this Article XII, except to the extent such indemnifying party

                                      -46-
<PAGE>

shall have been actually and materially prejudiced as a result of such failure,
but shall relieve the indemnifying party for any liability for legal fees and
expenses incurred prior to the date such notice is given. Notwithstanding the
foregoing, an indemnifying party may not assume the defense of any such
third-party claim if it does not demonstrate to the reasonable satisfaction of
the indemnified party that it has adequate financial resources to defend such
claim and pay any and all Losses that may result therefrom, or if the claim (i)
is reasonably likely to result in imprisonment of the indemnified party, (ii) is
reasonably likely to result in an equitable remedy which would materially impair
the indemnified party's ability to exercise its rights under this Agreement, or
impair Madden's right or ability to operate either of the Companies, or (iii)
names both the indemnifying party and the indemnified party (including impleaded
parties) and representation of both parties by the same counsel would create a
conflict. If an indemnifying party assumes the defense of such third party
claim, such indemnifying party shall agree prior thereto, in writing, that it is
liable under this Article XII to indemnify the indemnified party in accordance
with the terms contained herein in respect of such claim, shall conduct such
defense diligently, shall have full and complete control over the conduct of
such proceeding on behalf of the indemnified party and shall, subject to the
provisions of this Section 12.4, have the right to decide all matters of
procedure, strategy, substance and settlement relating to such proceeding;
provided, however, that any counsel chosen by such indemnifying party to conduct
such defense shall be reasonably satisfactory to the indemnified party, and the
indemnifying party will not without the written consent of the indemnified party
consent to the entry of any judgment or enter into any settlement with respect
to the matter which does not include a provision whereby the plaintiff or the
claimant in the matter releases the indemnified party from all liability with
respect thereto or which may reasonably be expected to have an adverse effect on
the indemnified party. The indemnified party may participate in such proceeding
and retain separate co-counsel at its sole cost and expense. Failure by an
indemnifying party to notify the indemnified party of its election to defend any
such claim or proceeding by a third party within thirty (30) days after notice
thereof shall be deemed a waiver by such indemnifying party of its right to
defend such claim or action.

     12.5 Non-Assumption of Defense. If no indemnifying party is permitted or
elects to assume the defense of any such claim by a third party or proceeding
resulting therefrom, the indemnified party shall diligently defend against such
claim or litigation in such manner as it may deem appropriate and, in such
event, the indemnifying party or parties shall promptly reimburse the
indemnified party for all reasonable out-of-pocket costs and expenses, legal or
otherwise, incurred by the indemnified party and its affiliates in connection
with the defense against such claim or proceeding, as such costs and expenses
are incurred. Any counsel chosen by such indemnified party to conduct such
defense must be reasonably satisfactory to the indemnifying party or parties,
and only one counsel shall be retained to represent all indemnified parties in
an action (except that if litigation is pending in more than one jurisdiction
with respect to an action, one such counsel may be retained in each jurisdiction
in which such litigation is pending). The indemnified party shall not settle or
compromise any such claim without the written consent of the indemnifying party,
which consent shall not be unreasonably withheld.

     12.6 Indemnified Party's Cooperation as to Proceedings. The indemnified
party will cooperate in all reasonable respects with any indemnifying party in
the conduct of any proceeding as to which such indemnifying party assumes the
defense. For the cooperation of the indemnified party pursuant to this Section
12.6, the indemnifying party or parties shall promptly reimburse the indemnified

                                      -47-
<PAGE>

party for all reasonable out-of-pocket costs and expenses, legal or otherwise,
incurred by the indemnified party or its affiliates in connection therewith, as
such costs and expenses are incurred.

     12.7 Payments Treated as Purchase Price Adjustment. Any payment by Madden,
either of the Companies or Seller under this Article XII will be treated for Tax
purposes as an adjustment to the consideration hereunder for the Company Shares.

                                  ARTICLE XIII

                                  Miscellaneous
                                  -------------

     13.1 Expenses. Except as otherwise explicitly set forth herein, whether or
not the transactions contemplated hereby are consummated, each party hereto
shall pay all costs and expenses incurred by such party in respect of the
transactions contemplated hereby; provided, however, that all expenses incurred
by either of the Companies with respect to the transactions contemplated hereby
for the benefit of Seller prior to the Closing, including, without limitation,
expenses for legal and investment advisory services, shall be paid by Seller.

     13.2 Entirety of Agreement. This Agreement (including the Disclosure
Schedule, the Madden Disclosure Schedule and all other schedules and exhibits
hereto), together with the other Transaction Documents and certificates and
other instruments delivered hereunder and thereunder, state the entire agreement
of the parties, merge all prior negotiations, agreements and understandings, if
any, and state in full all representations, warranties, covenants and agreements
which have induced this Agreement. Each party agrees that in dealing with third
parties no contrary representations will be made. Notwithstanding anything to
the contrary in this Section 13.2, unless and until the Closing occurs, the
Confidentiality Agreement shall continue in full force and effect.

     13.3 Notices. All notices, demands and communications of any kind which any
party hereto may be required or desire to serve upon another party under the
terms of this Agreement shall be in writing and shall be given by: (a) personal
service upon such other party; (b) mailing a copy thereof by certified or
registered mail, postage prepaid, with return receipt requested; (c) sending a
copy thereof by Federal Express or equivalent courier service; or (d) sending a
copy thereof by facsimile, in each case to the parties at the respective
addresses and facsimile numbers set forth on the signature pages hereto. In case
of service by Federal Express or equivalent courier service or by facsimile or
by personal service, such service shall be deemed complete upon delivery or
transmission, as applicable. In the case of service by mail, such service shall
be deemed complete on the fifth Business Day after mailing. The addresses and
facsimile numbers to which, and persons to whose attention, notices and demands
shall be delivered or sent may be changed from time to time by notice served as
hereinabove provided by any party upon any other party.

     13.4 Amendment. This Agreement may be modified or amended only by an
instrument in writing, duly executed by all of the parties hereto.

                                      -48-
<PAGE>

     13.5 Waiver. No waiver by any party of any term, provision, condition,
covenant, agreement, representation or warranty contained in this Agreement (or
any breach thereof) shall be effective unless it is in writing executed by the
party against which such waiver is to be enforced. No waiver shall be deemed or
construed as a further or continuing waiver of any such term, provision,
condition, covenant, agreement, representation or warranty (or breach thereof)
on any other occasion or as a waiver of any other term, provision, condition,
covenant, agreement, representation or warranty (or of the breach of any other
term, provision, condition, covenant, agreement, representation or warranty)
contained in this Agreement on the same or any other occasion.

     13.6 Counterparts; Facsimile. For the convenience of the parties, any
number of counterparts hereof may be executed, each such executed counterpart
shall be deemed an original and all such counterparts together shall constitute
one and the same instrument. Facsimile transmission of any signed original
counterpart and/or retransmission of any signed facsimile transmission shall be
deemed the same as the delivery of an original.

     13.7 Assignment; Binding Nature; No Beneficiaries. This Agreement may not
be assigned by any party hereto without the written consent of Madden and
Seller; provided, however, that Madden may assign its rights hereunder to any
affiliate of Madden which assumes the obligations of Madden hereunder, but no
such assignment shall relieve Madden of any such obligations. Subject to the
preceding sentence, this Agreement shall be binding upon, inure to the benefit
of, and be enforceable by the parties hereto and their respective heirs,
personal representatives, legatees, successors and permitted assigns. Except as
otherwise expressly provided in Article XII, this Agreement shall not confer any
rights or remedies upon any Person other than the parties hereto and their
respective heirs, personal representatives, legatees, successors and permitted
assigns.

     13.8 Headings. The headings in this Agreement are inserted for convenience
only and shall not constitute a part hereof.

     13.9 Governing Law; Jurisdiction. This Agreement shall be governed by, and
construed and enforced in accordance with, the laws of the State of New York
including, without limitation, Section 5-1401 of the New York General
Obligations Law and New York Civil Practice Laws and Rules 327. In the event of
any controversy or claim arising out of or relating to this Agreement or the
breach or alleged breach hereof, each of the parties hereto irrevocably (a)
submits to the non-exclusive jurisdiction of any New York state court sitting in
the County of New York or any federal court sitting in U.S. District Court for
the Southern District of the State of New York, (b) waives any objection which
it may have at any time to the laying of venue of any action or proceeding
brought in any such court, (c) waives any claim that such action or proceeding
has been brought in an inconvenient forum, and (d) agrees that service of
process or of any other papers upon such party by registered mail at the address
to which notices are required to be sent to such party under Section 13.3 shall
be deemed good, proper and effective service upon such party.

     13.10 Construction. In this Agreement (i) words denoting the singular
include the plural and vice versa, (ii) "it" or "its" or words denoting any
gender include all genders, (iii) the word "including" shall mean "including
without limitation," whether or not expressed, (iv) any reference to a statute

                                      -49-
<PAGE>

shall mean the statute and any regulations thereunder in force as of the date of
this Agreement or the Closing Date, as applicable, unless otherwise expressly
provided, (v) any reference herein to a Section, Article, Schedule or Exhibit
refers to a Section or Article of or a Schedule or Exhibit to this Agreement or
the Disclosure Schedule, as applicable, unless otherwise stated, and (vi) when
calculating the period of time within or following which any act is to be done
or steps taken, the date which is the reference day in calculating such period
shall be excluded and if the last day of such period is not a Business Day, then
the period shall end on the next day which is a Business Day.

     13.11 Negotiated Agreement. Madden and Seller acknowledge that they have
been advised and represented by counsel in the negotiation, execution and
delivery of this Agreement and the Transaction Documents and accordingly agree
that if an ambiguity exists with respect to any provision of this Agreement or
the Transaction Documents, such provision shall not be construed against any
party because such party or its representatives drafted such provision.

     13.12 Public Announcements. Neither Madden nor Seller shall issue any press
release or make any other public announcement concerning this Agreement or the
transactions contemplated hereby without the prior written approval of Madden,
in the case of an announcement by Seller, and Seller, in the case of an
announcement by Madden; provided, however, that Madden or its affiliates may,
upon written notice to Seller, describe this Agreement and the transactions
contemplated hereby in any press release or filing with the SEC or other
Governmental Body it is required to make under applicable Law.

     13.13 Remedies Cumulative. The remedies provided for or permitted by this
Agreement shall be cumulative and the exercise by any party of any remedy
provided for herein shall not preclude the assertion or exercise by such party
of any other right or remedy provided for herein.

     13.14 Severability. If any provision of this Agreement or the application
of any such provision to any party or circumstances shall be determined by any
arbitrator to be invalid or unenforceable to any extent, the remainder of this
Agreement, or the application of such provision to such person or circumstances
other than those to which it is so determined to be invalid or unenforceable,
shall not be affected thereby, and each provision hereof shall be enforced to
the fullest extent permitted by law. If the final determination of any
arbitrator declares that any item or provision hereof is invalid or
unenforceable, the parties hereto agree that the arbitrator making the
determination of invalidity or unenforceability shall have the power, and is
hereby directed, to reduce the scope, duration or area of the term or provision,
to delete specific words or phrases and to replace any invalid or unenforceable
term or provision with a term or provision that is valid and enforceable and
that comes closest to expressing the intention of the invalid or unenforceable
term or provision, and this Agreement shall be enforceable as so modified.

     13.15 WAIVER OF JURY TRIAL. MADDEN AND SELLER HEREBY IRREVOCABLY WAIVE, TO
THE FULLEST EXTENT PERMITTED BY LAW, ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM (WHETHER BASED UPON CONTRACT, TORT OR OTHERWISE)
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER TRANSACTION DOCUMENT
OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

                                      -50-
<PAGE>

     13.16 Right of Set-Off.

     (a) Notwithstanding any provision of this Agreement or the Earn-Out
Agreement to the contrary, the parties hereby acknowledge and agree that, in
addition to any other right hereunder or under the Earn-Out Agreement or
otherwise, Madden shall have the right, but not the obligation, from time to
time to set off against any amounts otherwise required to be paid by Madden to
Seller pursuant to this Agreement or the Earn-Out Agreement any amounts owed at
such time by Seller to either of the Companies, Madden or any other Madden
Indemnified Party under this Agreement or the Earn-Out Agreement.

     (b) If Madden elects to exercise its set-off rights hereunder against any
amounts otherwise required to be paid by Madden to Seller pursuant to this
Agreement or the Earn-Out Agreement, it shall give Seller written notice of such
election (the "Set-Off Notice"), which Set-Off Notice shall include the amount
to be set-off and a reasonable description of the circumstances giving rise to
Madden's entitlement to such set-off. Seller shall have ten (10) days after
receipt of such Set-Off Notice to review such Set-Off Notice (the "Set-Off
Review Period"), and in the event that Seller has any objections or challenges
to the exercise of the set-off right of Madden, Seller shall submit a single
written notice of set-off dispute ("Notice of Set-Off Dispute") to Madden during
such Set-Off Review Period, specifying in reasonable detail the nature of any
asserted objections or challenges. In the event of any such dispute, Seller and
Madden shall negotiate in good faith to resolve such dispute for thirty (30)
days after receipt by Madden of the Notice of Set-Off Dispute. If Seller and
Madden are unable to resolve such dispute with such 30-day period, the amount
payable by Madden to Seller shall automatically be reduced by the amount set
forth in the Set-Off Notice. In the event that there is a final determination
that Seller did not owe either of the Companies, Madden or any Madden
Indemnified Party the amount that has been set-off, Madden shall promptly repay
to Seller all such amounts that are so determined to have been incorrectly
set-off, plus interest, calculated from the date of set-off until the date such
amount is paid to Seller, at a rate per annum equal to the Prime Rate,
calculated and payable monthly, compounded monthly. For purposes of this Section
13.16, a determination shall be final if any and all appeals therefrom shall
have been resolved or if thirty (30) days shall have passed from the rendering
of such determination (or of any determination of appeal therefrom) and no party
shall have commenced any appeal therefrom.

     (c) In the case of any such set-off by Madden pursuant to this Section
13.16, Seller's obligation to make such payment (or any portion thereof) shall
be deemed satisfied and discharged to the extent of such set-off. The exercise
of such right of set-off by Madden in good faith, whether or not finally
determined to be justified, will not constitute a breach under this Agreement or
the Earn-Out Agreement.

               [Remainder of this page intentionally left blank.]

                                      -51-
<PAGE>

     IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Agreement as of the date first set forth above.

                                            STEVEN MADDEN, LTD.
Address:
52-16 Barnett Ave.                          By: /s/ JAMIESON A. KARSON
Long Island City, New York  11104               --------------------------------
Attention:  Awadhesh Sinha                      Name:  Jamieson A. Karson
Facsimile No.: (718) 446-5599                   Title: Chairman and
                                                        Chief Executive Officer

with copies to:

Kramer Levin Naftalis & Frankel LLP
1177 Avenue of the Americas
New York, New York  10036
Attention:  James A. Grayer, Esq.
Facsimile No.: (212) 715-8000

                                      -52-
<PAGE>

                                            SELLER

6 Kristi Lane                               /s/ DANIEL M. FRIEDMAN
Woodbury, New York 11797                    ------------------------------------
Facsimile No.: (212 ) 643-7524              Daniel M. Friedman

with copies to:

(Until March 15, 2006)

Wechsler & Cohen, LLP
116 John Street, 33rd Floor
New York, New York 10038
Attention:  Mitchell S. Cohen, Esq.
Facsimile No.: (212) 847-7955

(After March 15, 2006)

Wechsler & Cohen, LLP
17 State Street, 15th Floor
New York, New York 10004
Attention:  Mitchell S. Cohen, Esq.
Facsimile No.: (212) 847-7955

                                      -53-
<PAGE>

               Schedules and Exhibits to Stock Purchase Agreement

Disclosure Schedule
     Section 2.1                Company Shares/Capitalization
     Section 4.1                Company Subsidiaries
     Section 4.4                Conflicts and Consents
     Section 4.5(a)             Financial Statement Deficiencies
     Section 4.5(b)             Undisclosed Liabilities
     Section 4.5(c)             Material Programs and Allowances
     Section 4.5(d)             Inventory
     Section 4.6(a)             Late Tax Filings
     Section 4.6(b)             Unpaid Tax Deficiencies; Audits
     Section 4.6(c)             Miscellaneous Tax Representations
     Section 4.6(c)(iv)         Material Tax Elections
     Section 4.6(c)(xii)        Taxing Jurisdictions
     Section 4.7(a)-1           Real Property
     Section 4.7(a)-2           Real Property Consents/Defaults
     Section 4.7(b)             Title and Leasehold Deficiencies; Sublicenses
                                and Subleases
     Section 4.7(c)             Purchase Money Encumbrances
     Section 4.8(a)             Intellectual Property Deficiencies
     Section 4.8(b)             Breach of Company IP Rights Agreements
     Section 4.8(c)             Royalties
     Section 4.8(d)             Third Party Infringement
     Section 4.8(e)(i)          Confidentiality
     Section 4.8(e)(ii)         Affiliate Intellectual Property Claims
     Section 4.8(f)             License Agreements
     Section 4.8(g)             Infringement of Company IP Rights
     Section 4.8(h)             Intellectual Property Filings
     Section 4.9(a)             Contracts
     Section 4.9(b)             Contract Breaches and Defaults
     Section 4.10               Insurance Policies
     Section 4.11               Litigation
     Section 4.13(a)            Compliance with Laws
     Section 4.13(b)            Licenses
     Section 4.13(c)            Importer Status
     Section 4.13(g)            Customs Liabilities
     Section 4.14(a)            Employees
     Section 4.14(b)            Employment Laws
     Section 4.14(f)            Severance Obligations
     Section 4.14(g)            Accrued Vacations; Vacation Policy
     Section 4.14(h)            No At-Will Employees
     Section 4.14(i)            Reports
     Section 4.15(a)            Employee Benefit Plans
     Section 4.15(b)            Employment Agreements, Contracts and Employee
                                Benefit Plans Subject to Section 409A
     Section 4.15(p)            Employee Benefit Plan Maintenance Costs
     Section 4.16               Environmental Matters

                                      -54-
<PAGE>

     Section 4.17               Bank Accounts; Powers of Attorney
     Section 4.18               Certain Changes
     Section 4.20               Transactions with Affiliated Persons
     Section 4.21(a)            Customers
     Section 4.21(b)            Suppliers
     Section 4.23               Brokers, Finders, etc.
     Section 4.24               Restrictions on Business Activities
     Section 4.25               Payables
     Section 4.26               Receivables
     Section 4.27               Bonding and Financial Security Arrangements
     Section 6.1                Ordinary Course Exceptions
     Section 6.2                Conduct of Business

Madden Disclosure Schedule
     Section 5.5                Brokers, Finders, etc.

Other Schedules
     Schedule A                 Companies

Exhibits
     Exhibit A                  Earn-Out Agreement
     Exhibit B                  Seller Employment Agreement
     Exhibit C                  KH Employment Agreement
     Exhibit D                  SL Employment Agreement
     Exhibit E                  RC Employment Agreement
     Exhibit F                  Services Agreement
     Exhibit G                  Final Allocation
     Exhibit G-1                338(h)(10) Election Assumptions
     Exhibit H                  Form of Opinion of Wechsler & Cohen, LLP
     Exhibit I                  Form of Opinion of Kramer Levin Naftalis &
                                Frankel LLP
     Exhibit J                  Open Orders File

                                      -55-
<PAGE>

                                   Schedule A
                                   ----------

                                    Companies
                                    ---------

Daniel M. Friedman & Associates, Inc.

DMF International, Ltd.

                                      -56-
<PAGE>

                                   Exhibit G-1
                                   -----------

     For the avoidance of doubt, the determination of the amount to be paid by
Madden to Seller or by Seller to Madden pursuant to Section 8.1(b)(iii) (the
"Payment") shall be based, inter alia, on the following:

          1.   The Payment shall take into account any interest which may be
               imposed under Section 453A of the Code in respect of payments
               made pursuant to the Agreement, including Section 8.1(b)(iii)
               after the year in which the Closing occurs. Seller shall provide
               Madden with a schedule setting forth relevant information
               relating to any other installment obligations held by Seller.

          2.   Madden and Seller acknowledge that, pursuant to Treasury
               Regulation ss. 15A.453-1(b)(3)(i), neither of the Companies shall
               recognize any gain on the date of the Closing with respect to all
               liabilities of such Company existing immediately prior to the
               Closing that constitute qualifying indebtedness (within the
               meaning of Treasury Regulation ss. 15A.453-1(b)(2)(iv)) to the
               extent of such Company's aggregate basis in its assets.

          3.   Neither of the Companies shall elect out of the installment
               method pursuant to Section 453(d) of the Code with respect to the
               deemed sale of its assets.

          4.   This schedule is subject to change based upon any change in Law.

                                      -57-

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