Document:

Exhibit 10.1

 

[EXECUTION COPY]

 

	
   

  

 

 

CREDIT
AGREEMENT

dated
as of October 5, 2009

 

 

among

 

 

WADDELL &
REED FINANCIAL, INC.,

 

 

THE
LENDERS PARTY HERETO,

 

 

and

 

 

BANK OF
AMERICA, N.A.,

as Administrative Agent

 

 

BANC OF
AMERICA SECURITIES LLC,

as Lead Arranger and Book Manager

 

 

	
   

  

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  I            DEFINITIONS

  	
  1

  
	
   

  	
   

  
	
  SECTION 1.01.

  	
  Defined
  Terms

  	
  1

  
	
  SECTION 1.02.

  	
  Terms
  Generally

  	
  17

  
	
  SECTION 1.03.

  	
  Accounting
  Terms; GAAP

  	
  17

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  II           THE CREDITS

  	
  17

  
	
   

  	
   

  	
   

  
	
  SECTION 2.01.

  	
  Commitments

  	
  17

  
	
  SECTION 2.02.

  	
  Loans
  and Borrowings

  	
  18

  
	
  SECTION 2.03.

  	
  Requests
  for Borrowings, Conversions and Continuations of Loans

  	
  18

  
	
  SECTION 2.04.

  	
  Funding
  of Borrowings

  	
  19

  
	
  SECTION 2.05.

  	
  Termination
  and Reduction of Commitments

  	
  20

  
	
  SECTION 2.06.

  	
  Repayment
  of Loans; Evidence of Debt

  	
  21

  
	
  SECTION 2.07.

  	
  Prepayment
  of Loans

  	
  22

  
	
  SECTION 2.08.

  	
  Fees

  	
  22

  
	
  SECTION 2.09.

  	
  Interest

  	
  23

  
	
  SECTION 2.10.

  	
  Alternate
  Rate of Interest

  	
  24

  
	
  SECTION 2.11.

  	
  Increased
  Costs

  	
  24

  
	
  SECTION 2.12.

  	
  Break
  Funding Payments

  	
  25

  
	
  SECTION 2.13.

  	
  Taxes

  	
  26

  
	
  SECTION 2.14.

  	
  Payments
  Generally; Pro Rata Treatment; Sharing of Set-offs

  	
  29

  
	
  SECTION 2.15.

  	
  Mitigation
  Obligations; Replacement of Lenders

  	
  31

  
	
  SECTION 2.16.

  	
  Increase
  in Commitments

  	
  32

  
	
  SECTION 2.17.

  	
  Defaulting
  Lenders

  	
  34

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  III          REPRESENTATIONS AND WARRANTIES

  	
  34

  
	
   

  	
   

  	
   

  
	
  SECTION 3.01.

  	
  Organization;
  Powers

  	
  34

  
	
  SECTION 3.02.

  	
  Authorization;
  Enforceability

  	
  34

  
	
  SECTION 3.03.

  	
  Governmental
  Approvals; No Conflicts

  	
  34

  
	
  SECTION 3.04.

  	
  Financial
  Condition; No Material Adverse Effect

  	
  34

  
	
  SECTION 3.05.

  	
  Properties

  	
  35

  
	
  SECTION 3.06.

  	
  Litigation
  and Environmental Matters

  	
  35

  
	
  SECTION 3.07.

  	
  Compliance
  with Laws and Agreements

  	
  36

  
	
  SECTION 3.08.

  	
  Investment
  and Holding Company Status

  	
  36

  
	
  SECTION 3.09.

  	
  Taxes

  	
  36

  
	
  SECTION 3.10.

  	
  ERISA

  	
  36

  
	
  SECTION 3.11.

  	
  Disclosure

  	
  36

  
	
  SECTION 3.12.

  	
  No Default

  	
  37

  

 

i

 

TABLE OF CONTENTS

(continued)

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  SECTION 3.13.

  	
  Subsidiaries

  	
  37

  
	
  SECTION 3.14.

  	
  Federal
  Regulations

  	
  37

  
	
  SECTION 3.15.

  	
  No
  Burdensome Restrictions

  	
  37

  
	
  SECTION 3.16.

  	
  Insurance

  	
  37

  
	
  SECTION 3.17.

  	
  Taxpayer
  Identification Number

  	
  38

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  IV          CONDITIONS

  	
  38

  
	
   

  	
   

  
	
  SECTION 4.01.

  	
  Conditions
  to Closing Date

  	
  38

  
	
  SECTION 4.02.

  	
  Each
  Credit Event

  	
  40

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  V           AFFIRMATIVE COVENANTS

  	
  40

  
	
   

  	
   

  
	
  SECTION 5.01.

  	
  Financial
  Statements and Other Information

  	
  40

  
	
  SECTION 5.02.

  	
  Notices
  of Material Events

  	
  42

  
	
  SECTION 5.03.

  	
  Existence;
  Conduct of Business

  	
  43

  
	
  SECTION 5.04.

  	
  Payment
  of Obligations

  	
  43

  
	
  SECTION 5.05.

  	
  Maintenance
  of Properties; Insurance

  	
  43

  
	
  SECTION 5.06.

  	
  Books
  and Records; Inspection Rights

  	
  44

  
	
  SECTION 5.07.

  	
  Compliance
  with Laws

  	
  44

  
	
  SECTION 5.08.

  	
  Use
  of Proceeds

  	
  44

  
	
  SECTION 5.09.

  	
  Environmental
  Laws

  	
  44

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VI          NEGATIVE COVENANTS

  	
  45

  
	
   

  	
   

  
	
  SECTION 6.01.

  	
  Financial
  Condition Covenants

  	
  45

  
	
  SECTION 6.02.

  	
  Indebtedness

  	
  45

  
	
  SECTION 6.03.

  	
  Liens

  	
  46

  
	
  SECTION 6.04.

  	
  Fundamental
  Changes

  	
  46

  
	
  SECTION 6.05.

  	
  Investments,
  Loans, Advances, Guarantees and Acquisitions; Hedging Agreements

  	
  47

  
	
  SECTION 6.06.

  	
  Restricted
  Payments

  	
  47

  
	
  SECTION 6.07.

  	
  Transactions
  with Affiliates

  	
  48

  
	
  SECTION 6.08.

  	
  Restrictive
  Agreements

  	
  48

  
	
  SECTION 6.09.

  	
  Capital
  Expenditures

  	
  48

  
	
  SECTION 6.10.

  	
  Sales
  and Leasebacks

  	
  48

  
	
  SECTION 6.11.

  	
  Changes
  in Fiscal Periods

  	
  49

  
	
  SECTION 6.12.

  	
  Optional
  Payments and Modifications of Certain Debt Instruments

  	
  49

  
	
  SECTION 6.13.

  	
  Use
  of Proceeds

  	
  49

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VII        EVENTS OF DEFAULT

  	
  49

  

 

ii

 

TABLE OF CONTENTS

(continued)

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  
	
  ARTICLE
  VIII       THE ADMINISTRATIVE AGENT

  	
  52

  
	
   

  	
   

  
	
  SECTION 8.01.

  	
  Appointment
  and Authority

  	
  52

  
	
  SECTION 8.02.

  	
  Rights
  as a Lender

  	
  52

  
	
  SECTION 8.03.

  	
  Exculpatory
  Provisions

  	
  52

  
	
  SECTION 8.04.

  	
  Reliance
  by Administrative Agent

  	
  53

  
	
  SECTION 8.05.

  	
  Delegation
  of Duties

  	
  54

  
	
  SECTION 8.06.

  	
  Resignation
  of Administrative Agent

  	
  54

  
	
  SECTION 8.07.

  	
  Non-Reliance
  on Administrative Agent and Other Lenders

  	
  54

  
	
  SECTION 8.08.

  	
  No
  Other Duties, Etc

  	
  55

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  IX         MISCELLANEOUS

  	
  55

  
	
   

  	
   

  	
   

  
	
  SECTION 9.01.

  	
  Notices;
  Effectiveness; Electronic Communication

  	
  55

  
	
  SECTION 9.02.

  	
  Waivers;
  Amendments; Enforcement

  	
  57

  
	
  SECTION 9.03.

  	
  Expenses;
  Indemnity; Damage Waiver

  	
  58

  
	
  SECTION 9.04.

  	
  Successors
  and Assigns

  	
  60

  
	
  SECTION 9.05.

  	
  Survival

  	
  63

  
	
  SECTION 9.06.

  	
  Counterparts;
  Integration; Effectiveness

  	
  64

  
	
  SECTION 9.07.

  	
  Severability

  	
  64

  
	
  SECTION 9.08.

  	
  Right
  of Setoff

  	
  64

  
	
  SECTION 9.09.

  	
  Governing
  Law; Jurisdiction; Consent to Service of Process

  	
  65

  
	
  SECTION 9.10.

  	
  WAIVER
  OF JURY TRIAL

  	
  65

  
	
  SECTION 9.11.

  	
  Headings

  	
  66

  
	
  SECTION 9.12.

  	
  Confidentiality

  	
  66

  
	
  SECTION 9.13.

  	
  Interest
  Rate Limitation

  	
  66

  
	
  SECTION 9.14.

  	
  No
  Advisory or Fiduciary Responsibility

  	
  67

  
	
  SECTION 9.15.

  	
  USA
  Patriot Act

  	
  67

  

 

iii

 

SCHEDULES:

 

	
  Schedule
  2.01

  	
  —

  	
  Commitments

  
	
  Schedule
  3.01

  	
  -

  	
  Good
  Standing

  
	
  Schedule
  3.04

  	
  -

  	
  Financial
  Condition

  
	
  Schedule
  3.06

  	
  —

  	
  Disclosed
  Matters

  
	
  Schedule
  3.13

  	
  —

  	
  Subsidiaries

  
	
  Schedule
  6.02

  	
  —

  	
  Existing
  Indebtedness

  
	
  Schedule
  6.03

  	
  —

  	
  Existing
  Liens

  
	
  Schedule
  6.08

  	
  —

  	
  Existing
  Restrictions

  
	
  Schedule
  6.10

  	
  —

  	
  Sale/Leaseback
  Properties

  
	
  Schedule
  9.01

  	
  —

  	
  Administrative
  Agent’s Office; Certain Addresses for Notices

  

 

EXHIBITS:

 

	
  Exhibit A

  	
  —

  	
  Form of
  Assignment and Acceptance

  
	
  Exhibit B

  	
  —

  	
  Form of
  Note

  
	
  Exhibit C-1

  	
  —

  	
  Form of
  Report Under Section 5.01(e)(A)

  
	
  Exhibit C-2

  	
  —

  	
  Form of
  Report Under Section 5.01(e)(B)

  
	
  Exhibit D

  	
  —

  	
  Form of
  Revolving Borrowing Request

  
	
  Exhibit E

  	
  —

  	
  Form of
  Compliance Certificate

  

 

iv

 

CREDIT AGREEMENT

 

This CREDIT AGREEMENT
is entered into as of October 5, 2009, among WADDELL &
REED FINANCIAL, INC. (the “Borrower”), the several financial
institutions from time to time party hereto (collectively, the “Lenders”
and each individually, a “Lender”), and BANK OF
AMERICA, N.A. (“Bank of America”), as administrative agent
for the Lenders (in such capacity, together with any successors thereto in such
capacity, the “Administrative Agent”).

 

ARTICLE I

 

Definitions

 

SECTION 1.01. 
Defined Terms. As used in this Agreement, the following terms
have the meanings specified below:

 

“ABR Loan” means a Loan that bears interest based on the
Alternate Base Rate.

 

“Adjusted LIBO Rate” means, with
respect to any Eurodollar Loan for any Interest Period, a rate per annum
determined by the Administrative Agent pursuant to the following formula:

 

	
  Adjusted LIBO Rate =

  	
  LIBO Rate

  
	
  1.00 – Eurodollar Reserve
  Percentage

  

 

“Administrative Agent” has the meaning
specified in the introductory paragraph hereto.

 

“Administrative Agent’s Office” means
the Administrative Agent’s address and, as appropriate, account as set forth on
Schedule 9.01, or such other address or account as the Administrative
Agent may from time to time notify to the Borrower and the Lenders.

 

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

 

“Affiliate” means, with respect to a
specified Person, another Person that directly, or indirectly through one or
more intermediaries, Controls or is Controlled by or is under common Control
with the Person specified.

 

“Aggregate Revenue Base” means the sum
of Revenue Bases for all W&R Funds and for all other assets managed by the
Borrower or any Subsidiary of the Borrower for other entities.

 

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

 

 

“Alternate Base Rate” means, for any
day, a rate per annum equal to the greatest of (a) the Prime Rate in
effect on such day, (b) the Federal Funds Effective Rate in effect on such
day plus 1/2 of 1%, or (c) the Adjusted LIBO Rate for a one-month
Interest Period (it being understood that such rate shall be used solely as a
daily reference rate for determining the Alternate Base Rate) in effect for
such date (or if such day is not a Business Day, the immediately preceding
Business Day) plus 1%.  Any change
in the Alternate Base Rate due to a change in the Prime Rate, the Federal Funds
Effective Rate or the Adjusted LIBO Rate shall be effective from and including
the effective date of such change in the Prime Rate, the Federal Funds
Effective Rate or the Adjusted LIBO Rate, respectively.

 

“Applicable Percentage” means, with
respect to any Lender, the percentage (carried to the ninth decimal place) of
the total Commitments represented by such Lender’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.

 

“Applicable Rate” means, for any day,
with respect to any ABR Loan or Eurodollar Loan, or with respect to the
facility fees payable hereunder, as the case may be, the following percentages
per annum, based upon the Debt Rating as set forth below:

 

	
  Pricing 

  Level

  	
   

  	
  Debt Rating

  	
   

  	
  Facility Fee

  	
   

  	
  Eurodollar
  Loans

  	
   

  	
  ABR Loans

  	
   

  
	
  1

  	
   

  	
  > A- / A3

  	
   

  	
  0.350

  	
  %

  	
  2.650

  	
  %

  	
  1.650

  	
  %

  
	
  2

  	
   

  	
  BBB+
  / Baa1

  	
   

  	
  0.400

  	
  %

  	
  2.850

  	
  %

  	
  1.850

  	
  %

  
	
  3

  	
   

  	
  BBB
  / Baa2

  	
   

  	
  0.450

  	
  %

  	
  3.050

  	
  %

  	
  2.050

  	
  %

  
	
  4

  	
   

  	
  BBB-
  / Baa3

  	
   

  	
  0.500

  	
  %

  	
  3.500

  	
  %

  	
  2.500

  	
  %

  
	
  5

  	
   

  	
  <
  BBB- / Baa3

  	
   

  	
  0.625

  	
  %

  	
  3.875

  	
  %

  	
  2.875

  	
  %

  

 

, where “Debt Rating” means, as of any date
of determination, the rating as determined by either S&P or Moody’s
(collectively, the “Debt Ratings”) of the Borrower’s
non-credit-enhanced, senior unsecured long-term debt; provided that (a) if
the respective Debt Ratings issued by the foregoing rating agencies differ by
one level, then the Pricing Level for the higher of such Debt Ratings shall
apply (with the Debt Rating for Pricing Level 1 being the highest and the Debt
Rating for Pricing Level 5 being the lowest); (b) if there is a split in
Debt Ratings of more than one level, then the Pricing Level that is one level
lower than the Pricing Level of the higher Debt Rating shall apply; (c) if
the Borrower has only one Debt Rating, the Pricing Level that is one level
lower than that of such Debt Rating shall apply; and (d) if the Borrower
does not have any Debt Rating, Pricing Level 5 shall apply.

 

2

 

Initially, the Applicable
Rate shall be the percentages per annum set forth opposite Pricing Level
3.  The Applicable Rate shall be subject
to adjustment (upwards or downwards, as appropriate), effective as of the date
on which S&P or Moody’s announces a rating change which results in a change
in the Applicable Rate.

 

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

 

“Arranger” means Banc of America Securities LLC, in its capacity as
sole lead arranger and sole book manager.

 

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

 

“Assignment and Acceptance” means an
assignment and acceptance entered into by a Lender and an assignee (with the
consent of any party whose consent is required by Section 9.04),
and accepted by the Administrative Agent, in the form of Exhibit A
or any other form approved by the Administrative Agent.

 

“Availability Period” means the period
from and including the Closing Date to but excluding the earlier of the
Revolving Credit Termination Date or the date of termination of the
Commitments.

 

“Board” means the Board of Governors
of the Federal Reserve System of the United States of America.

 

“Borrower” has the meaning specified
in the introductory paragraph hereto.

 

“Borrowing” means a borrowing
consisting of simultaneous Loans of the same Type and, in the case of
Eurodollar Loans, having the same Interest Period made by each of the Lenders
pursuant to Section 2.01.

 

“Business Day” means any day that is
not a Saturday, Sunday or other day on which commercial banks in New York City
are authorized or required by law to remain closed; provided that, when
used in connection with a Eurodollar Loan, the term “Business Day” shall
also exclude any day on which banks are not open for dealings in dollar
deposits in the London interbank market.

 

“Capital Expenditures” means, for any
period, with respect to any Person, the aggregate of all expenditures by such
Person and its Subsidiaries for the acquisition or leasing (pursuant to a
capital lease) of fixed or capital assets or additions to equipment (including
replacements, capitalized repairs and improvements during such period) that
should be capitalized under GAAP on a consolidated balance sheet of such Person
and its Subsidiaries.

 

“Capital Lease Obligations” of any
Person means the obligations of such Person to pay rent or other amounts under
any lease of (or other arrangement conveying the right to use) 

 

3

 

real or personal property,
or a combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.

 

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

 

“Change in Control” means (a) the
acquisition of ownership, directly or indirectly, beneficially or of record, by
any Person or group (within the meaning of the Securities Exchange Act of 1934,
as amended, and the rules of the SEC thereunder as in effect on the date
hereof) other than the Borrower, of shares representing more than 25% of the
aggregate ordinary voting power represented by the issued and outstanding
capital stock of the Borrower, (b) the occupation of a majority of the
seats (other than vacant seats) on the board of directors of the Borrower by
Persons who were neither (i) nominated by the board of directors of the
Borrower nor (ii) appointed by directors so nominated, or (c) the
acquisition of direct or indirect Control of the Borrower by any Person or
group.

 

“Change in Law” means (a) the
adoption of any law, rule or regulation after the date of this Agreement, (b) any
change in any law, rule or regulation or in the interpretation or
application thereof by any Governmental Authority after the date of this
Agreement, or (c) compliance by any Lender (or, for purposes of Section 2.11(b),
by any lending office of such Lender or by such Lender’s holding company, if
any) with any request, guideline or directive (whether or not having the force
of law) of any Governmental Authority made or issued after the date of this
Agreement.

 

“Closing Date” means the date on which
the conditions precedent set forth in Section 4.01 shall have been
satisfied, which date is October 5, 2009.

 

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

 

“Commitment” means, with respect to
each Lender, the commitment of such Lender to make Loans hereunder,
expressed as an amount representing the maximum aggregate outstanding principal
amount of such Lender’s Loans hereunder, as such commitment may be (a) reduced
from time to time pursuant to Section 2.05, (b) reduced or
increased from time to time pursuant to assignments by or to such Lender
pursuant to Section 9.04, and (c) increased from time to time
pursuant to Section 2.16. 
The initial amount of each Lender’s Commitment is set forth on Schedule
2.01, or in the Assignment and Acceptance pursuant to which such Lender
shall have assumed its Commitment, as applicable, and the initial aggregate
amount of the Commitments of the Lenders (as set forth on Schedule 2.01)
is $125,000,000.

 

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

 

4

 

“Confidential Information Memorandum”
means the Confidential Information Memorandum dated August 2009 and
furnished to the Lenders.

 

“Consolidated EBITDA” means, for any
period, Consolidated Net Income for such period plus, without
duplication and to the extent reflected as a charge in the statement of such
Consolidated Net Income for such period, the sum of (a) income tax
expense, (b) interest expense, amortization or writeoff of debt discount
and debt issuance costs and commissions, discounts and other fees and charges
associated with Indebtedness (including the Loans), (c) depreciation and
amortization expense, (d) amortization of intangibles (including, but not
limited to, goodwill) and organization costs, (e) any extraordinary,
unusual or non-recurring non-cash expenses or losses (including, whether or not
otherwise includable as a separate item in the statement of such Consolidated
Net Income for such period, non-cash losses on sales of assets outside of the
ordinary course of business), provided, that the amounts referred to in
this clause (e) shall not, in the aggregate, exceed $1,000,000 for
any fiscal year of the Borrower, and (f) any other non-cash charges.  For the purposes of calculating Consolidated
EBITDA for any Reference Period pursuant to any determination of the
Consolidated Leverage Ratio, (i) if at any time during such Reference
Period the Borrower or any Subsidiary shall have made any Material Disposition,
the Consolidated EBITDA for such Reference Period shall be reduced by an amount
equal to the Consolidated EBITDA (if positive) attributable to the property
that is the subject of such Material Disposition for such Reference Period or
increased by an amount equal to the Consolidated EBITDA (if negative)
attributable thereto for such Reference Period, and (ii) if during such
Reference Period the Borrower or any Subsidiary shall have made a Material Acquisition,
Consolidated EBITDA for such Reference Period shall be calculated after giving pro
forma effect thereto as if such Material Acquisition occurred on the
first day of such Reference Period.  As
used in this definition, “Material Acquisition” means any acquisition of
property or series of related acquisitions of property that (a) constitutes
assets comprising all or substantially all of an operating unit of a business
or constitutes all or substantially all of the common stock of a Person and (b) involves
the payment of consideration by the Borrower and its Subsidiaries in excess of
$1,000,000; and “Material Disposition” means any Disposition of property or
series of related Dispositions of property that yields gross proceeds to the
Borrower or any of its Subsidiaries in excess of $1,000,000.

 

“Consolidated Interest Coverage Ratio”
means, for any period, the ratio of (a) Consolidated EBITDA for such
period to (b) Consolidated Interest Expense for such period.

 

“Consolidated Interest Expense” means,
for any period, interest expense (including that attributable to Capital Lease
Obligations) of the Borrower and its Subsidiaries for such period with respect
to all outstanding Indebtedness of the Borrower and its Subsidiaries (including
all commissions, discounts and other fees and charges owed with respect to
letters of credit and bankers’ acceptance financing and net costs under Hedging
Agreements in respect of interest rates to the extent such net costs are
allocable to such period in accordance with GAAP).

 

“Consolidated Leverage Ratio” means,
as at the last day of any period, the ratio of (a) Consolidated Total Debt
on such day to (b) Consolidated EBITDA for such period.

 

“Consolidated Net Income” means, for
any period, the consolidated net income (or loss) of the Borrower and its
Subsidiaries, determined on a consolidated basis in accordance 

 

5

 

with GAAP; provided
that there shall be excluded (a) the income (or deficit) of any Person
accrued prior to the date it becomes a Subsidiary of the Borrower or is merged
into or consolidated with the Borrower or any of its Subsidiaries, (b) the
income (or deficit) of any Person (other than a Subsidiary of the Borrower) in
which the Borrower or any of its Subsidiaries has an ownership interest, except
to the extent that any such income is actually received by the Borrower or such
Subsidiary in the form of dividends or similar distributions, and (c) the
undistributed earnings of any Subsidiary of the Borrower to the extent that the
declaration or payment of dividends or similar distributions by such Subsidiary
is not at the time permitted by the terms of any Contractual Obligation or
Requirement of Law applicable to such Subsidiary.

 

“Consolidated Total Debt” means, at any
date, the aggregate principal amount of all Indebtedness of the Borrower and
its Subsidiaries at such date, determined on a consolidated basis in accordance
with GAAP.

 

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

 

“Control” means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management or policies of a Person, whether through the ability to exercise
voting power, by contract or otherwise.  “Controlling”
and “Controlled” have meanings correlative thereto.

 

“Debt Rating” has the meaning
specified in the definition of Applicable Rate.

 

“Default” means any event or condition
which constitutes an Event of Default or which upon notice, lapse of time or
both would, unless cured or waived, become an Event of Default.

 

“Default Rate” means when used with
respect to any Loan, fee or other amount payable by the Borrower under any Loan
Document, an interest rate per annum equal to (a) the Alternate Base Rate plus
(b) the Applicable Rate, if any, applicable to ABR Loans plus (c) 2%
per annum; provided, however, that with respect to a Eurodollar
Loan, the Default Rate shall be an interest rate equal to the interest rate
(including any Applicable Rate) otherwise applicable to such Loan plus
2% per annum.

 

“Defaulting Lender” means any Lender
that, as determined by the Administrative Agent, (a) has failed to perform
its obligation to fund any portion of its Loans within one Business Day of the
date required to be funded by it hereunder, unless such obligation is the
subject of a good faith dispute, (b) has notified the Borrower, the
Administrative Agent or any Lender in writing that it does not intend to comply
with any of its funding obligations under this Agreement or has made a public
statement that it does not intend to comply with its funding obligations under
this Agreement or generally under other agreements in which it commits to
extend credit, (c) has failed, within one Business Day after written
request by the Administrative Agent, to confirm in a manner satisfactory to the
Administrative Agent, that it will comply with the terms of this Agreement
relating to its obligations to fund prospective Loans, (d) otherwise has failed
to pay over to the Administrative Agent or any other Lender any other amount 

 

6

 

required to be paid by it
hereunder within one Business Day of the date when due, unless the subject of a
good faith dispute, or (e) has, or has a direct or indirect parent company
that has, (i) become the subject of a proceeding under any bankruptcy or
insolvency proceeding, or (ii) had a receiver, conservator, trustee,
administrator, assignee for the benefit of creditors or similar Person charged
with reorganization or liquidation of its business or a custodian appointed for
it, or (iii) taken any action in furtherance of, or indicating its consent
to, approval of or acquiescence in any such proceeding or appointment; provided
that a Lender shall not be a Defaulting Lender solely by virtue of the
ownership or acquisition of any equity interest in such Lender or direct or
indirect parent company thereof by a Governmental Authority.  A Lender that has become a Defaulting Lender
because of an event referenced in this definition may cure such status and
shall no longer constitute a Defaulting Lender as provided in the last paragraph
of Section 2.17.

 

“Disclosed Matters” means the actions,
suits and proceedings and the environmental matters disclosed in Schedule
3.06 or otherwise delivered in writing to each of the Lenders on or prior
to the Closing Date.

 

“Distribution Fees” means all fees
payable pursuant to a plan contemplated by Rule 12b-1 under the Investment
Company Act of 1940, as amended, in connection with the distribution of shares
of W&R Funds that are open-end funds.

 

“dollars” or “$” refers to
lawful money of the United States of America.

 

“Eligible Assignee” means any Person
that meets the requirements to be an assignee under Section 9.04(b)(v) and
(vi) (subject to such consents, if any, as may be required under Section 9.04(b)(iii)).

 

“Environmental Laws” means all laws,
rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions,
notices or binding agreements issued, promulgated or entered into by any
Governmental Authority, relating in any way to the environment, preservation or
reclamation of natural resources, the management, release or threatened release
of any Hazardous Material or to health and safety matters.

 

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

 

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

 

“ERISA Affiliate” means any trade or
business (whether or not incorporated) that, together with the Borrower, is
treated as a single employer under Section 414(b) or (c) of the 

 

7

 

Code or, solely for purposes
of Section 302 of ERISA and Section 412 of the Code, is treated as a
single employer under Section 414 of the Code.

 

“ERISA Event” means (a) any “reportable
event”, as defined in Section 4043 of ERISA or the regulations issued
thereunder with respect to a Plan (other than an event for which the 30-day
notice period is waived), (b) the failure by the Borrower or any ERISA
Affiliate to make when due any required contribution (including any required
installment) under the pension funding rules to any Plan, determined
without regard to whether such required contribution may be or has been waived,
(c) the filing of an application for a waiver of any required contribution
under the pension funding rules, (d) the incurrence by the Borrower or any
of its ERISA Affiliates of any liability under Title IV of ERISA with respect
to the termination of any Plan, (e) the receipt by the Borrower or any
ERISA Affiliate from the PBGC or a plan administrator of any notice relating to
an intention to terminate any Plan or Plans or to appoint a trustee to
administer any Plan, (f) the incurrence by the Borrower or any of its
ERISA Affiliates of any liability with respect to the withdrawal or partial
withdrawal from any Plan or Multiemployer Plan, or (g) the receipt by the
Borrower or any ERISA Affiliate of any notice, or the receipt by any
Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice,
concerning the imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA. For this purpose, “pension funding rules”
means the rules of the Code and ERISA regarding minimum required
contributions (including any installment payment thereof) to Plans and set
forth in, with respect to plan years ending prior to the effective date as to
any such Plan of the Pension Protection Act of 2006, Sections 401(a)(29) and
412 of the Code and Part 3, Subtitle I, of Title I of ERISA each as in
effect prior to the Pension Protection Act of 2006 and, thereafter, Sections
412 and 430 through 436 of the Code and Part 3, Subtitle I, of Title I of
ERISA each as in effect from time to time.

 

“Eurodollar Loan” means a Loan that bears interest based on the Adjusted
LIBO Rate.

 

“Eurodollar Reserve Percentage” means,
for any day during any Interest Period, the reserve percentage (expressed as a
decimal, carried out to five decimal places) in effect on such day, whether or
not applicable to any Lender, under regulations issued from time to time by the
Board for determining the maximum reserve requirement (including any emergency,
supplemental or other marginal reserve requirement) with respect to
Eurocurrency funding (currently referred to as “Eurocurrency liabilities”).  The LIBO Rate for each outstanding Eurodollar
Loan shall be adjusted automatically as of the effective date of any change in
the Eurodollar Reserve Percentage.

 

“Event of Default” has the meaning
assigned to such term in Article VII.

 

“Excluded Taxes” means, with respect
to the Administrative Agent, any Lender, or any other recipient of any payment
to be made by or on account of any obligation of the Borrower hereunder, (a) income
or franchise taxes imposed on (or measured by) its net income by the United
States of America, or by the jurisdiction under the laws of which such
recipient is organized or in which its principal office is located or, in the
case of any Lender, in which its applicable lending office is located, (b) any
backup withholding or branch profits taxes imposed 

 

8

 

by the United States of
America or any similar tax imposed by any other jurisdiction in which the
Borrower is located, and (c) in the case of a Foreign Lender (other than
an assignee pursuant to a request by the Borrower under Section 2.15(b)),
any withholding tax that is imposed on amounts payable to such Foreign Lender
at the time such Foreign Lender becomes a party to this Agreement or is
attributable to such Foreign Lender’s failure or inability to comply with Section 2.13(e),
except to the extent that such Foreign Lender’s assignor (if any) was entitled,
at the time of assignment, to receive additional amounts from the Borrower with
respect to such withholding tax pursuant to Section 2.13(a).

 

“Existing Credit Agreement” means the
Credit Agreement, dated as of October 6, 2008, among the Borrower, certain
financial institutions party thereto as lenders and Bank of America, N.A., as
administrative agent for such lenders.

 

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

 

“Fee Letter” means the letter
agreement, dated as of August 20, 2009, among the Borrower, the
Administrative Agent and the Arranger.

 

“Financial Officer” means the chief
financial officer, principal accounting officer, treasurer or controller of the
Borrower.

 

“Foreign Lender” means any Lender that
is organized under the laws of a jurisdiction other than that in which the
Borrower is located.  For purposes of
this definition, the United States of America, each State thereof and the
District of Columbia shall be deemed to constitute a single jurisdiction.

 

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

 

“GAAP” means generally accepted
accounting principles in the United States of America.

 

“Governmental Authority” means the
government of the United States of America, any other nation or any political
subdivision thereof, whether state or local, and any agency, authority,
instrumentality, regulatory body (including self-regulatory body), court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or 

 

9

 

administrative powers or
functions of or pertaining to government, including, in any event, the SEC and
any applicable state securities commission or similar body.

 

“Guarantee” of or by any Person (the “guarantor”)
means any obligation, contingent or otherwise, of the guarantor guaranteeing or
having the economic effect of guaranteeing any Indebtedness or other obligation
of any other Person (the “primary obligor”) in any manner, whether
directly or indirectly, and including any obligation of the guarantor, direct
or indirect, (a) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Indebtedness or other obligation or to purchase
(or to advance or supply funds for the purchase of) any security for the
payment thereof, (b) to purchase or lease property, securities or services
for the purpose of assuring the owner of such Indebtedness or other obligation
of the payment thereof, (c) to maintain working capital, equity capital or
any other financial statement condition or liquidity of the primary obligor so
as to enable the primary obligor to pay such Indebtedness or other obligation,
or (d) as an account party in respect of any letter of credit or letter of
guaranty issued to support such Indebtedness or obligation; provided,
that the term Guarantee shall not include endorsements for collection or
deposit in the ordinary course of business.

 

“Hazardous Materials” means all
explosive or radioactive substances or wastes and all hazardous or toxic
substances, wastes or other pollutants, including petroleum or petroleum
distillates, asbestos or asbestos containing materials, polychlorinated
biphenyls, radon gas, infectious or medical wastes and all other substances or
wastes of any nature regulated pursuant to any Environmental Law.

 

“Hedging Agreement” means any interest
rate protection agreement, foreign currency exchange agreement, commodity price
protection agreement or other interest or currency exchange rate or commodity
price hedging arrangement.

 

“Increase Effective Date” has the
meaning specified in Section 2.16(a).

 

“Increasing Lender” has the meaning
specified in Section 2.16(a).

 

“Indebtedness” of any Person means,
without duplication, (a) all obligations of such Person for borrowed money
or with respect to deposits or advances of any kind, (b) all obligations
of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all
obligations of such Person upon which interest charges are customarily paid, (d) all
obligations of such Person under conditional sale or other title retention
agreements relating to property acquired by such Person, (e) all
obligations of such Person in respect of the deferred purchase price of
property or services (excluding current accounts payable incurred in the
ordinary course of business), (f) all Indebtedness of others secured by
(or for which the holder of such Indebtedness has an existing right, contingent
or otherwise, to be secured by) any Lien on property owned or acquired by such
Person, whether or not the Indebtedness secured thereby has been assumed, (g) all
Capital Lease Obligations of such Person (but, for the avoidance of doubt,
excluding any operating lease obligations), (h) all obligations,
contingent or otherwise, of such Person as an account party in respect of
letters of credit and letters of guaranty, (i) all obligations, contingent
or otherwise, of such Person in respect of bankers’ acceptances, (j) net
liabilities of such Person under Hedging Agreements, and (k) all
Guarantees by such Person in 

 

10

 

respect of any of the
foregoing.  The Indebtedness of any
Person shall include the Indebtedness of any other entity (including any
partnership in which such Person is a general partner) to the extent such
Person is liable therefor as a result of such Person’s ownership interest in or
other relationship with such entity, except to the extent the terms of such
Indebtedness provide that such Person is not liable therefor.

 

“Indemnified Taxes” means Taxes other
than Excluded Taxes.

 

“Interest Payment Date” means (a) with
respect to any ABR Loan, the last Business Day of each March, June, September and
December and the Revolving Credit Termination Date, and (b) with
respect to any Eurodollar Loan, the last day of the Interest Period applicable
to such Loan and the Revolving Credit Termination Date and, in the case of a
Eurodollar Loan with an Interest Period of more than three months’ duration,
each day prior to the last day of such Interest Period that occurs at intervals
of three months’ duration, after the first day of such Interest Period.

 

“Interest Period” means, with respect
to any Eurodollar Loan, the period commencing on the date such Eurodollar Loan
is disbursed or converted to or continued as a Eurodollar Loan and ending on
the date that is one, two, three or six months thereafter, as the Borrower may
elect; provided, that (a) if any Interest Period would end on a day
other than a Business Day, such Interest Period shall be extended to the next
succeeding Business Day unless such next succeeding Business Day would fall in
the next calendar month, in which case such Interest Period shall end on the
next preceding Business Day, (b) any Interest Period that commences on the
last Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the last calendar month of such Interest
Period) shall end on the last Business Day of the last calendar month of such
Interest Period, and (c) any Interest Period that would otherwise extend
beyond the Revolving Credit Termination Date shall end on the Revolving Credit
Termination Date or such date of final payment, as the case may be.

 

“Lenders” has the meaning specified in
the introductory paragraph hereto.

 

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

 

11

 

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

 

“Loans” means the loans made by the
Lenders to the Borrower pursuant to this Agreement.

 

“Loan Documents” means this Agreement,
each Note and the Fee Letter.

 

“Management Contract” means an
agreement, written or oral, pursuant to which the Borrower or any Subsidiary of
the Borrower provides (a) investment advisory, management or
administrative services to a W&R Fund, or (b) investment advisory or
management services to any Person, including, without limitation, unregistered
investment companies and personal or corporate investment accounts.

 

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

 

“Material Indebtedness” means
Indebtedness (other than the Loans), or obligations in respect of one or more
Hedging Agreements, of any one or more of the Borrower and its Subsidiaries in
an aggregate principal amount exceeding $5,000,000.  For purposes of determining Material Indebtedness,
the “principal amount” of the obligations of the Borrower or any Subsidiary in
respect of any Hedging Agreement at any time shall be the maximum aggregate
amount (giving effect to any netting agreements) that the Borrower or such
Subsidiary would be required to pay if such Hedging Agreement were terminated
at such time.

 

“Moody’s” means Moody’s Investors
Service, Inc. and any successor thereto.

 

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

 

“Net Asset Value” means, at any date
of determination and with respect to any investment company or account manager,
the “current net asset” value (as defined in Rule 2a-4 under the
Investment Company Act of 1940, as amended), in the aggregate, of all
outstanding redeemable securities issued by such investment company at such
date.

 

“Note” means a promissory note made by
the Borrower in favor of a Lender evidencing Loans made by such Lender,
substantially in the form of Exhibit B.

 

“Other Taxes” means any and all
present or future stamp or documentary taxes or any other excise or property
taxes, charges or similar levies arising from any payment made 

 

12

 

under the Loan Documents or
from the execution, delivery or enforcement of, or otherwise with respect to, the
Loan Documents.

 

“Participant” has the meaning
specified in Section 9.04(d).

 

“Participating Lender” has the meaning
specified in Section 2.16(a).

 

“PBGC” means the Pension Benefit
Guaranty Corporation referred to and defined in ERISA and any successor entity
performing similar functions.

 

“Permitted Acquisition” means an
acquisition of a Person, or the assets of a Person or a line of business of a
Person, in the same or a related line of business as the Borrower, provided
that after giving effect to such acquisition (a) no Default or Event of
Default shall have occurred and be continuing, (b) the Borrower shall be
in compliance, on a pro  forma basis, as of the end of the most
recent fiscal quarter of the Borrower with the provisions of Section 6.01
after giving effect to such acquisition and the incurrence of any Indebtedness
in connection therewith, and (c) in the case of an acquisition involving
aggregate consideration valued at $20,000,000 or more, at least three Business
Days prior to the date of such acquisition, the Borrower shall have furnished
to the Administrative Agent and the Lenders a compliance certificate to the
effect of clauses (a) and (b) showing in reasonable
detail the calculations supporting the determination of compliance, on such a pro
forma basis, with such provisions.

 

“Permitted Encumbrances” means:

 

(a)           Liens
imposed by law for taxes that are not yet due or are being contested in
compliance with Section 5.04;

 

(b)           Carriers’,
warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like Liens
imposed by law, arising in the ordinary course of business and securing
obligations that are not overdue by more than 30 days or are being contested in
compliance with Section 5.04;

 

(c)           pledges
and deposits made in the ordinary course of business in compliance with workers’
compensation, unemployment insurance and other social security laws or
regulations;

 

(d)           deposits
to secure the performance of bids, trade contracts, leases, statutory
obligations, surety and appeal bonds, performance bonds and other obligations
of a like nature, in each case in the ordinary course of business;

 

(e)           easements,
zoning restrictions, rights-of-way and similar encumbrances on real property
imposed by law or arising in the ordinary course of business that do not secure
any monetary obligations and do not materially detract from the value of the
affected property or interfere with the ordinary conduct of business of the
Borrower or any Subsidiary; and

 

13

 

(f)            judgment
Liens in respect of judgments that do not constitute an Event of Default under clause
(k) of Article VII, so long as such judgment Liens are not
in effect for more than 45 days;

 

provided that the term “Permitted
Encumbrances” shall not include any Lien securing Indebtedness.

 

“Permitted Investments” means:

 

(a)           direct
obligations of, or obligations the principal of and interest on which are
unconditionally guaranteed by, the United States of America (or by any agency
thereof to the extent such obligations are backed by the full faith and credit
of the United States of America), in each case maturing within one year from
the date of acquisition thereof;

 

(b)           investments
in commercial paper maturing within 270 days from the date of acquisition
thereof and having, at such date of acquisition, an investment-grade credit
rating from S&P or from Moody’s;

 

(c)           investments
in certificates of deposit, banker’s acceptances and time deposits maturing
within 540 days from the date of acquisition thereof issued or guaranteed by or
placed with, and money market deposit accounts issued or offered by, any
domestic office of any commercial bank organized under the laws of the United
States of America or any State thereof which has a combined capital and surplus
and undivided profits of not less than $500,000,000;

 

(d)           investments
in newly created funds or investments intended for sale to newly created funds
advised or managed by the Borrower and its Subsidiaries, in an aggregate amount
(based upon book value on the books of the Borrower and its Subsidiaries) of
not more than $40,000,000 at any time;

 

(e)           investments
in funds advised or managed by the Borrower and its Subsidiaries for the
benefit of the Borrower’s and its Subsidiaries’ senior executives and portfolio
management personnel in conjunction with various nonqualified deferral
compensation arrangements adopted by the Borrower and its Subsidiaries, in an
aggregate amount (based on book value on the books of the Borrower and its
Subsidiaries) of not more than $25,000,000 at any time;

 

(f)            fully
collateralized repurchase agreements with a term of not more than 30 days for
securities described in clause (a) above and entered into with a
financial institution satisfying the criteria described in clause (c) above;
and

 

(g)           other
than those contained in clauses (a), (b), (c) and (e) above,
United States dollar denominated fixed income securities and syndicated bank
loans not to exceed $7,500,000 per issuer, with the exception of United States
government securities, and not to exceed $7,500,000 per country, with the
exception of the United States of America.

 

“Person” means any natural person,
corporation, limited liability company, trust, joint venture, association,
company, partnership, Governmental Authority or other entity.

 

14

 

“Plan” means any employee pension
benefit plan (other than a Multiemployer Plan) subject to the provisions of
Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA,
and in respect of which the Borrower or any ERISA Affiliate is (or, if such
plan were terminated, would under Section 4069 of ERISA be deemed to be)
an “employer” as defined in Section 3(5) of ERISA.

 

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

 

“Reference Period” means, at any date
of determination, the most recently completed four fiscal quarters of the
Borrower.

 

“Register” has the meaning set forth
in Section 9.04.

 

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

 

“Required Lenders” means Lenders
having Revolving Credit Exposures and unused Commitments representing at least
51% of the sum of the aggregate Revolving Credit Exposures and unused
Commitments of all Lenders at such time; provided that the unused
Commitment of, and the portion of the aggregate Revolving Credit Exposures held
or deemed held by, any Defaulting Lender shall be excluded for purposes of
making a determination of Required Lenders.

 

“Requirement of Law” means, as to any
Person, the Certificate of Incorporation and By-Laws or other organizational or
governing documents of such Person, and any law, treaty, rule or
regulation or determination, order, injunction, writ or decree of an arbitrator
or a court or other Governmental Authority, in each case applicable to or
binding upon such Person or any of its property or to which such Person or any
of its property is subject.

 

“Restricted Payment” means (a) any
dividend or other distribution (whether in cash, securities or other property)
with respect to any shares of any class of capital stock of the Borrower or any
Subsidiary, or (b) any payment (whether in cash, securities or other
property), including any sinking fund or similar deposit, for (i) the
purchase, redemption, retirement, acquisition, cancellation or termination of
any shares of the Borrower’s capital stock, or (ii) any option, warrant or
other right to acquire any shares of the Borrower’s capital stock.

 

“Revenue Base” means the sum of (a) the
product of (i) with respect to each W&R Fund, the Net Asset Value of
the W&R Fund on the date of calculation and with respect to assets managed
for other entities, the market value or Net Asset Value of such assets on the
date of calculation, and (ii) the rate provided for in the applicable
Management Contract for 

 

15

 

determining the annual fee
required for such advisory, management or administrative services on such date,
and (b) Distribution Fees for such W&R Fund.

 

“Revolving Borrowing Request” means a
notice of (a) a Borrowing, (b) a conversion of Loans from one Type to
the other, or (c) a continuation of Eurodollar Loans, pursuant to Section 2.03,
which, if in writing, shall be substantially in the form of Exhibit D.

 

“Revolving Credit Exposure” means,
with respect to any Lender at any time, the sum of the outstanding principal
amount of such Lender’s Loans at such time.

 

“Revolving Credit Termination Date”
means October 4, 2010 or such earlier date as the Commitments shall
terminate pursuant to the terms hereof (or, if such day is not a Business Day,
the next preceding Business Day).

 

“SEC” means the Securities and
Exchange Commission, or any Governmental Authority succeeding to any of its
principal functions.

 

“S&P” means Standard &
Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc.,
and any successor thereto.

 

“subsidiary” means, with respect to
any Person (the “parent”) at any date, any corporation, limited
liability company, partnership, association or other entity the accounts of
which would be consolidated with those of the parent in the parent’s
consolidated financial statements if such financial statements were prepared in
accordance with GAAP as of such date, as well as any other corporation, limited
liability company, partnership, association or other entity (a) of which
securities or other ownership interests representing more than 50% of the
equity or more than 50% of the ordinary voting power or, in the case of a
partnership, more than 50% of the general partnership interests are, as of such
date, owned, controlled or held, or (b) that is, as of such date,
otherwise Controlled, by the parent or one or more subsidiaries of the parent
or by the parent and one or more subsidiaries of the parent.

 

“Subsidiary” means any subsidiary of
the Borrower.

 

“Taxes” means all present or future
taxes, levies, imposts, duties, deductions, withholdings (including backup
withholding), assessments, fees or other charges imposed by any Governmental
Authority, including any interest, additions to tax or penalties applicable
thereto.

 

“Transactions” means the execution,
delivery and performance by the Borrower of the Loan Documents, the borrowing
of Loans and the use of the proceeds thereof.

 

“Type” when used in reference to any
Loan, refers to whether the rate of interest on such Loan is determined by
reference to the Adjusted LIBO Rate or the Alternate Base Rate.

 

“W&R Fund” means all closed-end
funds and open-end mutual funds sponsored by the Borrower or any of its
Subsidiaries or for which the Borrower or any of its Subsidiaries provides
investment advisory, management, administrative, supervisory, consulting,
underwriting or similar services.

 

16

 

“Withdrawal Liability” means liability
to a Multiemployer Plan as a result of a complete or partial withdrawal from
such Multiemployer Plan, as such terms are defined in Part I of Subtitle E
of Title IV of ERISA.

 

SECTION 1.02. 
Terms Generally.  The
definitions of terms herein shall apply equally to the singular and plural
forms of the terms defined.  Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms.  The words “include”,
“includes” and “including” shall be deemed to be followed by the phrase “without
limitation”.  The word “will” shall be
construed to have the same meaning and effect as the word “shall”.  Unless the context requires otherwise (a) any
definition of or reference to any agreement, instrument or other document
herein shall be construed as referring to such agreement, instrument or other
document as from time to time amended, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or modifications
set forth herein), (b) any reference herein to any Person shall be
construed to include such Person’s successors and assigns, (c) the words “herein”,
“hereof” and “hereunder”, and words of similar import, shall be construed to
refer to this Agreement in its entirety and not to any particular provision
hereof, (d) all references herein to Articles, Sections, Exhibits and
Schedules shall be construed to refer to Articles and Sections of, and Exhibits
and Schedules to, this Agreement, and (e) the words “asset” and “property”
shall be construed to have the same meaning and effect and to refer to any and
all tangible and intangible assets and properties, including cash, securities,
accounts and contract rights.

 

SECTION 1.03. 
Accounting Terms; GAAP. 
Except as otherwise expressly provided herein, all terms of an
accounting or financial nature shall be construed in accordance with GAAP, as
in effect from time to time; provided that, if the Borrower notifies the
Administrative Agent that the Borrower requests an amendment to any provision
hereof to eliminate the effect of any change occurring after the date hereof in
GAAP or in the application thereof on the operation of such provision (or if
the Administrative Agent notifies the Borrower that the Required Lenders
request an amendment to any provision hereof for such purpose), regardless of
whether any such notice is given before or after such change in GAAP or in the
application thereof, then such provision shall be interpreted on the basis of
GAAP as in effect and applied immediately before such change shall have become
effective until such notice shall have been withdrawn or such provision amended
in accordance herewith.

 

ARTICLE II

 

The
Credits

 

SECTION 2.01. 
Commitments.  Subject to
the terms and conditions set forth herein, each Lender severally agrees to make
Loans to the Borrower from time to time during the Availability Period in an
aggregate principal amount that will not result in such Lender’s Revolving
Credit Exposure exceeding such Lender’s Commitment; provided, however,
that after giving effect to any Borrowing, the aggregate Revolving Credit
Exposures of all Lenders shall not exceed the aggregate Commitments of all
Lenders then in effect.  Within the
foregoing limits and subject to the terms and conditions set forth herein, the
Borrower may borrow, prepay and reborrow Loans. 
Loans may be ABR Loans or Eurodollar Loans, as further provided herein.

 

17

 

SECTION 2.02. 
Loans and Borrowings.  (a) 
Each Loan to be made as a part of a Borrowing, continuation or conversion of
Loans shall be made by the Lenders ratably in accordance with their Applicable
Percentage.  The failure of any Lender to
make any Loan required to be made by it shall not relieve any other Lender of
its obligations hereunder.

 

(b)           Subject
to Section 2.10, each Borrowing shall be comprised entirely of ABR
Loans or Eurodollar Loans as the Borrower may request in accordance
herewith.  Each Lender at its option may
make any Eurodollar Loan by causing any domestic or foreign branch or Affiliate
of such Lender to make such Loan; provided that any exercise of such
option shall not affect the obligation of the Borrower to repay such Loan in
accordance with the terms of this Agreement.

 

(c)           Each
Borrowing of, conversion to, or continuation of Eurodollar Loans shall be in a
principal amount of $5,000,000 or a whole multiple of $1,000,000 in excess thereof.  Each Borrowing of or conversion to ABR Loans
shall be in a principal amount of $5,000,000 or a whole multiple of $1,000,000
in excess thereof; provided that a Borrowing of ABR Loans may be in an
aggregate amount that is equal to the entire unused balance of the aggregate
Commitments.  Borrowings of more than one
Type may be outstanding at the same time; provided that there shall not
at any time be more than a total of ten (10) Interest Periods in effect
with respect to Eurodollar Loans.

 

(d)           Notwithstanding
any other provision of this Agreement, the Borrower shall not be entitled to
request, or to elect to convert or continue, any Eurodollar Loan if the
Interest Period requested with respect thereto would end after the Revolving
Credit Termination Date.

 

SECTION 2.03. 
Requests for Borrowings, Conversions and Continuations of Loans.  Each Borrowing, each conversion of Loans from
one Type to the other, and each continuation of Eurodollar Loans shall be made
upon the Borrower’s irrevocable notice to the Administrative Agent, which may
be given by telephone.  Each such notice
must be received by the Administrative Agent not later than 10:00 a.m.,
New York City time (a) three (3) Business Days before the date of the
proposed Borrowing of, conversion to or continuation of Eurodollar Loans or of
any conversion of Eurodollar Loans to ABR Loans, or (b) one (1) Business
Day before the date of the proposed Borrowing of any ABR Loans.  Each telephonic notice by the Borrower
pursuant to this Section 2.03 must be confirmed promptly by
delivery to the Administrative Agent of a written Revolving Borrowing Request,
appropriately completed and signed by a Financial Officer of the Borrower.  Each such telephonic and written Revolving Borrowing
Request shall specify the following information in compliance with Section 2.02:

 

(i)            whether the
Borrower is requesting a Borrowing, a conversion of Loans from one Type to the
other, or a continuation of Eurodollar Loans;

 

(ii)           the aggregate
amount of the Loans to be borrowed, converted or continued;

 

(iii)          the date (which
shall be a Business Day) of such Borrowing, conversion or continuation, as the
case may be;

 

18

 

(iv)          the Type of Loans to
be borrowed or to which existing Loans are to be converted;

 

(v)           in the case of a
Borrowing of, conversion to, or continuation of Eurodollar Loans, the duration
of the Interest Period to be applicable thereto, which shall be a period
contemplated by the definition of the term “Interest Period”; and

 

(vi)          the location and
number of the Borrower’s account to which Loans are to be disbursed, which
shall comply with the requirements of Section 2.04.

 

If no election as to the Type of Loan is
specified in a Revolving Borrowing Request or if the Borrower fails to give a
timely notice requesting a conversion or continuation, then the applicable Loan
shall be made as, or converted to, an ABR Loan. 
Any such automatic conversion to an ABR Loan shall be effective as of
the last day of the Interest Period then in effect with respect to the
applicable Eurodollar Loan.  If the
Borrower requests a Borrowing of, conversion to, or continuation of a
Eurodollar Loan, but fails to specify an Interest Period, then the Borrower
shall be deemed to have selected an Interest Period of one month’s duration.

 

After the occurrence and during the
continuance of an Event of Default, no Loans may be requested as, converted to
or continued as Eurodollar Loans without the consent of the Required Lenders.

 

Promptly following receipt of a Revolving
Borrowing Request in accordance with this Section, the Administrative Agent
shall advise each Lender of the details thereof and of the amount of such
Lender’s Loan to be made as part of the requested Borrowing, conversion or
continuation, and if no timely notice of a conversion or continuation is
provided by the Borrower, the Administrative Agent shall notify each Lender of
the details of any automatic conversion to ABR Loans described in this Section.

 

SECTION 2.04. 
Funding of Borrowings.  (a) 
Each Lender shall make each Loan to be made by it hereunder on the proposed
date thereof in immediately available funds by 12:00 noon, New York City time,
at the Administrative Agent’s Office. 
Upon satisfaction of the applicable conditions set forth in Section 4.02,
the Administrative Agent will make such Loans available to the Borrower in like
funds as received by the Administrative Agent either by (i) crediting the
account of the Borrower on the books of the Administrative Agent with the
amount of such funds or (ii) wire transfer of such funds, in each case in
accordance with instructions provided to (and reasonably acceptable to) the
Administrative Agent by the Borrower in the applicable Revolving Borrowing
Request.

 

(b)           The
Administrative Agent shall promptly notify the Borrower and the Lenders of the
interest rate applicable to any Interest Period for Eurodollar Loans upon
determination of such interest rate.  At
any time that ABR Loans are outstanding, the Administrative Agent shall notify
the Borrower and the Lenders of any change in the Prime Rate used in
determining the Alternate Base Rate promptly following the public announcement
of such change.

 

19

 

(c)           Unless
the Administrative Agent shall have received notice from a Lender prior to the
proposed date of any Borrowing that such Lender will not make available to the
Administrative Agent such Lender’s share of such Borrowing, the Administrative
Agent may assume that such Lender has made such share available on such date in
accordance with paragraph (a) of this Section and may, in its sole
discretion, in reliance upon such assumption, make available to the Borrower a
corresponding amount.  In such event, if
a Lender has not in fact made its share of the applicable Borrowing available
to the Administrative Agent, then the applicable Lender and the Borrower
severally agree to pay to the Administrative Agent forthwith on demand such
corresponding amount with interest thereon, for each day from and including the
date such amount is made available to the Borrower to but excluding the date of
payment to the Administrative Agent, at (i) in the case of such Lender,
the greater of the Federal Funds Effective Rate and a rate determined by the
Administrative Agent in accordance with banking industry rules on
interbank compensation, plus any administrative, processing or similar fees
customarily charged by the Administrative Agent in connection with the
foregoing, or (ii) in the case of the Borrower, the interest rate applicable
to ABR Loans.  If the Borrower and such
Lender shall pay such interest to the Administrative Agent for the same or an
overlapping period, the Administrative Agent shall promptly remit to the
Borrower the amount of such interest paid by the Borrower for such period.  If such Lender pays such amount to the
Administrative Agent, then such amount shall constitute such Lender’s Loan
included in such Borrowing.  A notice of
the Administrative Agent to any Lender or the Borrower with respect to any amount
owing under this subsection (c) shall be conclusive, absent
manifest error.

 

(d)           If
any Lender makes available to the Administrative Agent funds for any Loan to be
made by such Lender as provided in the foregoing provisions of this Section 2.04,
and such funds are not made available to the Borrower by the Administrative
Agent because the conditions to the applicable Borrowing set forth in Article IV
are not satisfied or waived in accordance with the terms hereof, the
Administrative Agent shall return such funds (in like funds as received from
such Lender) to such Lender, without interest.

 

(e)           Nothing
herein shall be deemed to obligate any Lender to obtain the funds for any Loan
in any particular place or manner or to constitute a representation by any Lender
that it has obtained or will obtain the funds for any Loan in any particular
place or manner.

 

SECTION 2.05. 
Termination and Reduction of Commitments.  (a)  Unless previously terminated, the
Commitments shall terminate on the Revolving Credit Termination Date.

 

(b)           The
Borrower may, upon notice to the Administrative Agent pursuant to Section 2.05(c),
at any time terminate, or from time to time reduce, the Commitments; provided
that (i) each reduction of the Commitments shall be in an amount that is
an integral multiple of $1,000,000 and not less than $10,000,000, and (ii) the
Borrower shall not terminate or reduce the Commitments if, after giving effect
to any concurrent prepayment of the Loans in accordance with Section 2.07,
the aggregate Revolving Credit Exposures of all Lenders would exceed the
aggregate Commitments of all Lenders then in effect.

 

(c)           The
Borrower shall notify the Administrative Agent of any election to terminate or
reduce the Commitments under paragraph (b) of this Section at least
three (3) 

 

20

 

Business Days prior to the effective date of such
termination or reduction, specifying such election and the effective date
thereof.  Promptly following receipt of
any notice, the Administrative Agent shall advise the Lenders of the contents
thereof.  Each notice delivered by the
Borrower pursuant to this Section shall be irrevocable; provided
that a notice of termination of the Commitments delivered by the Borrower may
state that such notice is conditioned upon the effectiveness of other credit
facilities, in which case such notice may be revoked by the Borrower (by notice
to the Administrative Agent on or prior to the specified effective date) if
such condition is not satisfied.  Any
termination or reduction of the Commitments shall be permanent.  Each reduction of the Commitments shall be
made ratably among the Lenders in accordance with their Applicable
Percentage.  All fees accrued until the
effective date of any termination of the Commitments shall be paid on the
effective date of such termination.

 

SECTION 2.06. 
Repayment of Loans; Evidence of Debt.  (a)  The Borrower hereby unconditionally
promises to pay to the Administrative Agent for the account of each Lender the
then unpaid principal amount of each Loan on the Revolving Credit Termination
Date (or such earlier date on which the Loans become due and payable pursuant
to Article VII).

 

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

 

(c)           The
Administrative Agent shall maintain accounts in which it shall record (i) the
amount of each Loan made hereunder, the Type thereof and the Interest Period
applicable thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from the Borrower to each Lender hereunder,
and (iii) the amount of any sum received by the Administrative Agent
hereunder for the account of the Lenders and each Lender’s share thereof.

 

(d)           The
entries made in the accounts maintained pursuant to paragraph (b) or (c) of
this Section shall be prima  facie evidence of the existence
and amounts of the obligations recorded therein; provided that the
failure of any Lender or the Administrative Agent to maintain such accounts or
any error therein shall not in any manner limit or otherwise affect the
obligation of the Borrower to repay the Loans in accordance with the terms of
this Agreement.  In the event of any
conflict between the accounts and records maintained by any Lender and the
accounts and records of the Administrative Agent in respect of such matters,
the accounts and records of the Administrative Agent shall control in the
absence of manifest error.

 

(e)           Upon
the request of any Lender made through the Administrative Agent, the Borrower
shall execute and deliver to such Lender (through the Administrative Agent) a
Note, which shall evidence such Lender’s Loans in addition to such accounts or
records maintained pursuant to paragraph (b). 
Each Lender may attach schedules to its Note and endorse thereon the
date, Type (if applicable), amount and maturity of its Loans and payments with
respect thereto.

 

21

 

SECTION 2.07.  Prepayment
of Loans.  (a)  The Borrower
shall have the right at any time and from time to time to prepay any Loans in
whole or in part, subject to prior notice in accordance with paragraph (b) of
this Section.

 

(b)                                 The Borrower shall notify the
Administrative Agent by telephone (confirmed by telecopy) of any prepayment
hereunder (i) in the case of prepayment of a Eurodollar Loan, not later
than 11:00 a.m., New York City time, three (3) Business Days before
the date of prepayment, or (ii) in the case of prepayment of an ABR Loan,
not later than 11:00 a.m., New York City time, one (1) Business Day
before the date of prepayment.  Each such
notice shall be irrevocable and shall specify the prepayment date and the
principal amount of the Loans to be prepaid and the Type(s) of Loans to be
prepaid and, if Eurodollar Loans are to be prepaid, the Interest Period(s) of
such Loans; provided that, if a notice of prepayment is given in
connection with a conditional notice of termination of the Commitments as
contemplated by Section 2.05, then such notice of prepayment may be
revoked if such notice of termination is revoked in accordance with Section 2.05.  Promptly following receipt of any such
notice, the Administrative Agent shall advise the Lenders of the contents
thereof and of the amount of such Lender’s ratable share of such
prepayment.  Each partial prepayment of
any Loans shall be in an amount that would be permitted in the case of an
advance of a Borrowing of the same Type as provided in Section 2.02.  Any prepayment of a Eurodollar Loan shall be
accompanied by all accrued interest on the amount prepaid as required pursuant
to Section 2.09(d), together with any additional amounts required
pursuant to Section 2.12. 
Each such prepayment shall be applied to the Loans of the Lenders
ratably in accordance with their respective Revolving Credit Exposure.

 

(c)                                  If for any reason the
aggregate Revolving Credit Exposures of all Lenders at any time exceeds the
aggregate Commitments of all Lenders then in effect, the Borrower shall
immediately prepay Loans in an aggregate amount equal to such excess.

 

SECTION 2.08. 
Fees.  (a)  The
Borrower agrees to pay to the Administrative Agent for the account of each
Lender, a facility fee which shall accrue at the Applicable Rate on the daily
amount of the Commitment of such Lender (whether used or unused), during the
Availability Period, including at any time during which one or more of the
conditions in Section 4.02 is not met; provided, however,
that (i) if such Lender continues to have any outstanding Loans after the
Availability Period, then such facility fee shall continue to accrue on the
daily amount of the outstanding Loans of such Lender from and including the
date on which the aggregate Commitments of all Lenders are terminated to, but
excluding, the date on which such Lender ceases to have any outstanding Loans
and (ii) if such Lender is a Defaulting Lender at any time, such facility
fee shall cease to accrue on, and the Borrower shall not be required to pay a
facility fee with respect to, the daily unused amount of the Commitment of such
Lender during such period of time such Lender is a Defaulting Lender.  Accrued facility fees shall be payable in
arrears on the last Business Day of March, June, September and December of
each year and on the date on which the Commitments terminate, commencing on the
first such date to occur after the Closing Date; provided that any
facility fees accruing after the date on which the aggregate Commitments
terminate shall be payable on demand. 
The facility fee owing with respect to each Lender shall be calculated
quarterly in arrears, and if there is any change in the Applicable Rate during
any quarter, the actual daily amount shall be computed and multiplied by the
Applicable Rate separately for each period during such quarter that such
Applicable Rate was in effect.  All 

 

22

 

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 Borrower shall pay to the Arranger
and the Administrative Agent, for their own respective accounts, fees in the
amounts and at the times specified in the Fee Letter.  Such fees shall be fully earned when paid and
shall not be refundable for any reason whatsoever.

 

(c)                                  The Borrower shall pay to the Lenders
such fees as shall have been separately agreed upon in writing in the amounts
and at the times so specified.  Such fees
shall be fully earned when paid and shall not be refundable for any reason
whatsoever.

 

SECTION 2.09. 
Interest.  (a) 
Subject to the provisions of subsection (c) below, the ABR Loans
shall bear interest at a rate per annum equal to the Alternate Base Rate plus
the Applicable Rate.

 

(b)                                 Subject to the provisions of subsection
(c) below, each Eurodollar Loan shall bear interest at a rate per
annum equal to the Adjusted LIBO Rate for the Interest Period in effect for
such Eurodollar Loan plus the Applicable Rate.

 

(c)                                  (i)                                     If any amount of principal of any Loan is not paid
when due (without regard to any applicable grace periods), whether at stated
maturity, by acceleration or otherwise, such amount shall thereafter bear
interest at a fluctuating interest rate per annum at all times equal to the
Default Rate to the fullest extent permitted by applicable law.

 

(ii)                                  If any amount (other than principal of
any Loan) payable by the Borrower under any Loan Document is not paid when due
(without regard to any applicable grace periods), whether at stated maturity,
by acceleration or otherwise, then upon the request of the Required Lenders,
such amount shall thereafter bear interest at a fluctuating interest rate per
annum at all times equal to the Default Rate to the fullest extent permitted by
applicable law.

 

(iii)                               Upon the request of the Required Lenders,
while any Event of Default exists, the Borrower shall pay interest on the
principal amount of all outstanding Loans or any fee or other amount payable by
the Borrower hereunder at a fluctuating interest rate per annum at all times
equal to the Default Rate to the fullest extent permitted by applicable law.

 

(d)                                 Accrued interest on each Loan shall be
payable in arrears on each Interest Payment Date for such Loan; provided
that (i) interest accrued pursuant to subsection (c) of this Section shall
be payable on demand, (ii) in the event of any repayment or prepayment of
any Loan (other than a prepayment of an ABR Loan prior to the end of the
Availability Period), accrued interest on the principal amount repaid or
prepaid shall be payable on the date of such repayment or prepayment, (iii) in
the event of any conversion of any Eurodollar Loan prior to the end of the
Interest Period therefor, accrued interest on such Loan shall be payable on the
effective date of such conversion, and (iv) all accrued interest shall be
payable upon the Revolving Credit Termination Date.

 

23

 

(e)                                  All interest hereunder shall be computed
on the basis of a year of 365 days (or 366 days in a leap year), and shall be
payable for the actual number of days elapsed (including the first day but
excluding the last day); provided that any Loan that is repaid on the
same day on which it is made shall, subject to Section 2.14(a),
bear interest for one day.  The
applicable Alternate Base Rate, Adjusted LIBO Rate or LIBO Rate shall be
determined by the Administrative Agent, and such determination shall be
conclusive absent manifest error.

 

SECTION 2.10. 
Alternate Rate of Interest. 
(a)  If, in connection with any request for a Eurodollar Loan or a
conversion to or continuation thereof, the Required Lenders determine that for
any reason (which determination shall be conclusive absent manifest error) that
(a) dollar deposits are not being offered to banks in the London interbank
eurodollar market for the applicable amount and Interest Period of such
Eurodollar Loan, (b) adequate and reasonable means do not exist for
ascertaining the Adjusted LIBO Rate or the LIBO Rate, as applicable, for any
requested Interest Period with respect to a proposed Eurodollar Loan; or (c) the
Adjusted LIBO Rate or the LIBO Rate, as applicable, for any requested Interest
Period with respect to a proposed Eurodollar Loan will not adequately and fairly
reflect the cost to such Lenders of funding such Loan, then the Administrative
Agent shall give notice thereof to the Borrower and each Lender by telephone or
telecopy as promptly as practicable thereafter. 
Until the Administrative Agent (upon the instruction of the Required
Lenders) revokes such notice, (i) any Revolving Borrowing Request that
requests the conversion of any Loan to, or continuation of any Loan as, a
Eurodollar Loan shall be ineffective, and (ii) if any Revolving Borrowing
Request requests a Borrowing of Eurodollar Loans, such Borrowing shall be made
as an ABR Loan.

 

(b)                                 If any Lender determines that any law has
made it unlawful, or that any Governmental Authority has asserted that it is
unlawful, for any Lender or its applicable lending office to make, maintain or
fund Eurodollar Loans, or to determine or charge interest rates based upon the
LIBOR Rate, or any Governmental Authority has imposed material restrictions on
the authority of such Lender to purchase or sell, or to take deposits of,
dollars in the London interbank market, then, on notice thereof by such Lender
to the Borrower through the Administrative Agent, any obligation of such Lender
to make or continue Eurodollar Loans or to convert ABR Loans to Eurodollar
Loans shall be suspended until such Lender notifies the Administrative Agent
and the Borrower that the circumstances giving rise to such determination no
longer exist.  Upon receipt of such
notice, the Borrower shall, upon demand from such Lender (with a copy to the Administrative
Agent), prepay or, if applicable, convert all Eurodollar Loans of such Lender
to ABR Loans, either on the last day of the Interest Period therefor, if such
Lender may lawfully continue to maintain such Eurodollar Loans to such day, or
immediately, if such Lender may not lawfully continue to maintain such
Eurodollar Loans.

 

SECTION 2.11.  Increased Costs.  (a)  If any Change in Law shall:

 

(i)                                     impose, modify or deem applicable any
reserve, special deposit, compulsory loan, insurance charge or similar
requirement against assets of, deposits with or for the account of, or credit
extended by, any Lender (except any such reserve requirement reflected in the
Adjusted LIBO Rate); or

 

(ii)                                  subject any Lender to any tax of any kind
whatsoever with respect to this Agreement or any Eurodollar Loan made by it, or
change the basis of taxation of 

 

24

 

payments to such
Lender in respect thereof (except for Indemnified Taxes or Other Taxes covered
by Section 2.13 and the imposition of, or any change in the rate
of, any Excluded Tax payable by such Lender); or

 

(iii)                               impose on any Lender or the London
interbank market any other condition affecting this Agreement or Eurodollar
Loans made by such Lender;

 

and the result of any of the foregoing shall be to
increase the cost to such Lender of making or maintaining any Eurodollar Loan
(or of maintaining its obligation to make any such Loan) or to increase the
cost to such Lender or to reduce the amount of any sum received or receivable
by such Lender hereunder (whether of principal, interest or any other amount),
then, upon request of such Lender, the Borrower will pay to such Lender such
additional amount or amounts as will compensate such Lender for such additional
costs incurred or reduction suffered.

 

(b)                                 If any Lender determines that any Change
in Law regarding capital requirements has or would have the effect of reducing
the rate of return on such Lender’s capital or on the capital of such Lender’s
holding company, if any, as a consequence of this Agreement, the Commitments of
such Lender or the Loans made hereunder, to a level below that which such
Lender or such Lender’s holding company could have achieved but for such Change
in Law (taking into consideration such Lender’s policies and the policies of
such Lender’s holding company with respect to capital adequacy), then from time
to time the Borrower will pay to such Lender such additional amount or amounts
as will compensate such Lender or such Lender’s holding company for any such
reduction suffered.

 

(c)                                  A certificate of a Lender setting forth
the amount or amounts necessary to compensate such Lender or its holding
company, as the case may be, as specified in paragraph (a) or (b) of
this Section shall be delivered to the Borrower and shall be conclusive
absent manifest error.  The Borrower
shall pay such Lender the amount shown as due on any such certificate within
ten (10) days after receipt thereof.

 

(d)                                 Failure or delay on the part of any
Lender to demand compensation pursuant to this Section shall not
constitute a waiver of such Lender’s right to demand such compensation; provided
that the Borrower shall not be required to compensate a Lender pursuant to this
Section for any increased costs or reductions incurred more than six (6) months
prior to the date that such Lender notifies the Borrower of the Change in Law
giving rise to such increased costs or reductions and of such Lender’s
intention to claim compensation therefor; provided  further that,
if the Change in Law giving rise to such increased costs or reductions is
retroactive, then the six-month period referred to above shall be extended to
include the period of retroactive effect thereof.

 

(e)                                  Subject to Section 2.11(d),
all of the Borrower’s obligations under this Section 2.11 shall
survive termination of the Commitments, repayment of all Loans and other
obligations hereunder, and resignation of the Administrative Agent.

 

SECTION 2.12. 
Break Funding Payments.  In
the event of (a) the payment of any principal of any Eurodollar Loan other
than on the last day of an Interest Period applicable thereto (whether
voluntary, mandatory, by reason of acceleration, or otherwise), (b) the 

 

25

 

conversion
of any Eurodollar Loan other than on the last day of the Interest Period
applicable thereto (whether voluntary, mandatory, automatic, by reason of
acceleration, or otherwise), (c) the failure to borrow, convert, continue
or prepay any Loan on the date specified in any notice delivered pursuant
hereto (regardless of whether such notice is permitted to be revocable under Section 2.07(b) and
is revoked in accordance herewith), or (d) the assignment of any
Eurodollar Loan other than on the last day of the Interest Period applicable
thereto as a result of a request by the Borrower pursuant to Section 2.15,
then, in any such event, the Borrower shall compensate each Lender for the
loss, cost and expense attributable to such event.  The Borrower shall also pay any customary
administrative fees charged by such Lender in connection with the
foregoing.  In the case of a Eurodollar
Loan, the loss to any Lender attributable to any such event shall be deemed to
include an amount determined by such Lender to be equal to the excess, if any, of
(i) the amount of interest that such Lender would pay for a deposit equal
to the principal amount of such Loan for the period from the date of such
payment, conversion, failure or assignment to the last day of the then current
Interest Period for such Loan (or, in the case of a failure to borrow, convert
or continue, the duration of the Interest Period that would have resulted from
such borrowing, conversion or continuation) if the interest rate payable on
such deposit were equal to the Adjusted LIBO Rate (in the case of a Eurodollar
Loan) for such Interest Period, over (ii) the amount of interest that such
Lender would earn on such principal amount for such period if such Lender were
to invest such principal amount for such period at the interest rate that would
be bid by such Lender (or an affiliate of such Lender) for dollar deposits from
other banks in the eurodollar market at the commencement of such period.  A certificate of any Lender setting forth any
amount or amounts that such Lender is entitled to receive pursuant to this Section shall
be delivered to the Borrower and shall be conclusive absent manifest
error.  The Borrower shall pay such
Lender the amount shown as due on any such certificate within ten (10) days
after receipt thereof.  All of the
Borrower’s obligations under this Section 2.12 shall survive
termination of the Commitments, repayment of all Loans and other obligations
hereunder, and resignation of the Administrative Agent.

 

SECTION 2.13. 
Taxes.  (a)  Any and
all payments by or an account of any obligation of the Borrower hereunder shall
be made free and clear of and without deduction for any Indemnified Taxes or
Other Taxes; provided that if the Borrower shall be required to deduct
any Indemnified Taxes or Other Taxes from such payments, then (i) the sum
payable shall be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section) the Administrative Agent or Lender (as the case may be) receives
an amount equal to the sum it would have received had no such deductions been
made, (ii) the Borrower shall make such deductions, and (iii) the
Borrower shall pay the full amount deducted to the relevant Governmental
Authority in accordance with applicable law.

 

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

 

(c)                                  (i) The Borrower shall indemnify the
Administrative Agent and each Lender within ten (10) days after written
demand therefor, for the full amount of any Indemnified Taxes or Other Taxes
(including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) paid by the Administrative 

 

26

 

Agent or such Lender, as the case may be, and any
penalties, interest and reasonable expenses arising therefrom or with respect
thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority.  The Borrower shall also, and does hereby,
indemnify the Administrative Agent, and shall make payment in respect thereof
within ten (10) days after demand therefor, for any amount which a Lender
for any reason fails to pay indefeasibly to the Administrative Agent as
required by clause (ii) of this subsection.  A certificate as to the amount of such
payment or liability delivered to the Borrower by a Lender or by the
Administrative Agent on its own behalf or on behalf of a Lender, shall be
conclusive absent manifest error.

 

(ii)                                  Without limiting the provisions of subsection
(a), (b) or (c) above, each Lender shall, and does
hereby, indemnify the Borrower and the Administrative Agent, and shall make
payment in respect thereof within ten (10) days after demand therefor,
against any and all Taxes and any and all related losses, claims, liabilities,
penalties, interest and expenses (including the fees, charges and disbursements
of any counsel for the Borrower or the Administrative Agent) incurred by or
asserted against the Borrower or the Administrative Agent by any Governmental
Authority as a result of the failure by such Lender to deliver, or as a result
of the inaccuracy, inadequacy or deficiency of, any documentation required to
be delivered by such Lender to the Borrower or the Administrative Agent
pursuant to subsection (e).  Each
Lender hereby authorizes the Administrative Agent to set off and apply any and
all amounts at any time owing to such Lender under this Agreement or any other
Loan Document against any amount due to the Administrative Agent under this clause
(ii).  The agreements in this clause
(ii) shall survive the resignation and/or replacement of the
Administrative Agent, any assignment of rights by, or the replacement of, a
Lender.

 

(d)                                 As soon as practicable after any payment
of Indemnified Taxes or Other Taxes by the Borrower to a Governmental
Authority, the Borrower shall deliver to the Administrative Agent the original
or a certified copy of a receipt issued by such Governmental Authority
evidencing such payment, a copy of the return reporting such payment or other
evidence of such payment reasonably satisfactory to the Administrative Agent.

 

(e)                                  (i)  Each Lender shall deliver to
the Borrower and to the Administrative Agent, at the time or times prescribed
by applicable laws or when reasonably requested by the Borrower or the
Administrative Agent, such properly completed and executed documentation
prescribed by applicable laws or by the taxing authorities of any jurisdiction
and such other reasonably requested information as will permit the Borrower or
the Administrative Agent, as the case may be, to determine (A) whether or
not payments made hereunder or under any other Loan Document are subject to
Taxes, (B) if applicable, the required rate of withholding or deduction,
and (C) such Lender’s entitlement to any available exemption from, or
reduction of, applicable Taxes in respect of all payments to be made to such
Lender by the Borrower pursuant to this Agreement or otherwise to establish
such Lender’s status for withholding tax purposes in the applicable
jurisdiction.

 

(ii)                                  Without limiting the generality of the
foregoing, if the Borrower is resident for tax purposes in the United States,

 

27

 

(A)                              any Lender that
is a “United States person” within the meaning of Section 7701(a)(30) of
the Code shall deliver to the Borrower and the Administrative Agent executed
originals of Internal Revenue Service Form W-9 or such other documentation
or information prescribed by applicable laws or reasonably requested by the
Borrower or the Administrative Agent as will enable the Borrower or the
Administrative Agent, as the case may be, to determine whether or not such
Lender is subject to backup withholding or information reporting requirements;
and

 

(B)                                each Foreign
Lender that is entitled under the Code or any applicable treaty to an exemption
from or reduction of withholding tax with respect to payments hereunder or
under any other Loan Document shall deliver to the Borrower and the
Administrative Agent (in such number of copies as shall be requested by the
recipient) on or prior to the date on which such Foreign Lender becomes a
Lender under this Agreement (and from time to time thereafter upon the request
of the Borrower or the Administrative Agent, but only if such Foreign Lender is
legally entitled to do so), whichever of the following is applicable:

 

(I)                                    properly
completed and executed originals of Internal Revenue Service Form W-8BEN
claiming eligibility for benefits of an income tax treaty to which the United
States is a party,

 

(II)                                properly
completed and executed originals of Internal Revenue Service Form W-8ECI,

 

(III)                            properly
completed and executed originals of Internal Revenue Service Form W-8IMY
and all required supporting documentation,

 

(IV)                            in the case of
a Foreign Lender claiming the benefits of the exemption for portfolio interest
under section 881(c) of the Code, (x) a certificate, in form and
substance reasonably acceptable to the Borrower, to the effect that such
Foreign Lender is not (A) a “bank” within the meaning of section 881(c)(3)(A) of
the Code, (B) a “10 percent shareholder” of the Borrower within the
meaning of section 881(c)(3)(B) of the Code, or (C) a “controlled
foreign corporation” described in section 881(c)(3)(C) of the Code and (y) properly
completed and executed originals of 
Internal Revenue Service Form W-8BEN, or

 

(V)                                properly
completed and executed originals of any other form prescribed by applicable
laws as a basis for 

 

28

 

claiming
exemption from or a reduction in United States Federal withholding tax together
with such supplementary documentation as may be prescribed by applicable laws
to permit the Borrower or the Administrative Agent to determine the withholding
or deduction required to be made.

 

(iii)                               Each Lender shall promptly (A) notify
the Borrower and the Administrative Agent of any change in circumstances which
would modify or render invalid any claimed exemption or reduction, and (B) take
such steps as shall not be materially disadvantageous to it, in the reasonable
judgment of such Lender, and as may be reasonably necessary (including the
re-designation of its lending office) to avoid any requirement of applicable
laws of any jurisdiction that the Borrower or the Administrative Agent make any
withholding or deduction for taxes from amounts payable to such Lender.

 

(f)                                    Unless required by applicable laws, at no
time shall the Administrative Agent have any obligation to file for or
otherwise pursue on behalf of a Lender, or have any obligation to pay to any
Lender, any refund of Taxes withheld or deducted from funds paid for the
account of such Lender.

 

(g)                                 All of the Borrower’s obligations under
this Section 2.13 shall survive termination of the Commitments,
repayment of all Loans and other obligations hereunder, and resignation of the
Administrative Agent.

 

(h)                                 If the Administrative Agent or any Lender
determines, in its sole discretion, that it has received a refund of any
Indemnified Taxes or Other Taxes as to which it has been indemnified by the
Borrower or with respect to which the Borrower has paid additional amounts
pursuant to this Section, it shall pay to the Borrower an amount equal to such
refund (but only to the extent of indemnity payments made, or additional
amounts paid, by the Borrower under this Section with respect to the Taxes
or Other Taxes giving rise to such refund), net of all out-of-pocket expenses
incurred by the Administrative Agent or such Lender, as the case may be, and
without interest (other than any interest paid by the relevant Governmental
Authority with respect to such refund), provided that the Borrower, upon
the request of the Administrative Agent or such Lender, agrees to repay the
amount paid over to the Borrower (plus any penalties, interest or other charges
imposed by the relevant Governmental Authority) to the Administrative Agent or
such Lender in the event the Administrative Agent or such Lender is required to
repay such refund to such Governmental Authority.  This subsection shall not be construed to
require the Administrative Agent or any Lender to make available its tax
returns (or any other information relating to its taxes that it deems
confidential) to the Borrower or any other Person.

 

SECTION 2.14. 
Payments Generally; Pro Rata Treatment; Sharing of Set-offs.  (a)  All payments to be made by the
Borrower shall be made without condition or deduction for any counterclaim,
defense, recoupment or setoff.  The
Borrower shall make each payment required to be made by it hereunder (whether
of principal, interest, fees, or under Sections 2.11, 2.12 or 2.13,
or otherwise) to the Administrative Agent, for the account of the respective
Lenders to which such payment is owed, at the Administrative Agent’s Office
prior to 12:00 noon, New 

 

29

 

York
City time, on the date when due, in immediately available funds.  Any amounts received after such time on any
date shall be deemed to have been received on the next succeeding Business Day
and any applicable interest or fee shall continue to accrue.  The Administrative Agent will promptly
distribute to each Lender its Applicable Percentage (or other applicable share
as provided herein) of such payment in like funds as received by wire transfer
to such Lender (or as otherwise directed by such Lender).  If any payment hereunder shall be due on a
day that is not a Business Day, the date for payment shall be extended to the
next succeeding Business Day, and, in the case of any payment accruing
interest, interest thereon shall be payable for the period of such
extension.  All payments hereunder shall
be made in dollars.

 

(b)                                 If at any time the funds received by the
Administrative Agent hereunder are insufficient to pay fully all principal,
interest, fees and other amounts then due and payable under this Agreement or
any other Loan Document, such funds shall be applied as set forth in Article VII.

 

(c)                                  If any Lender shall, by exercising any
right of set-off or counterclaim or otherwise, obtain payment in respect of any
principal of or interest on any of its Loans resulting in such Lender receiving
payment of a greater proportion of the aggregate amount of its Loans and
accrued interest thereon than the proportion received by any other Lender, then
the Lender receiving such greater proportion shall (i) notify the
Administrative Agent of such fact and (ii) purchase (for cash at face
value) participations in the Loans of other Lenders, or make such other
adjustments as shall be equitable, to the extent necessary so that the benefit
of all such payments shall be shared by the Lenders ratably in accordance with
the aggregate amount of principal of and accrued interest on their respective Loans;
provided that (i) if any such participations are purchased and all
or any portion of the payment giving rise thereto is recovered, such
participations shall be rescinded and the purchase price restored to the extent
of such recovery, without interest, and (ii) the provisions of this
paragraph shall not be construed to apply to any payment made by the Borrower
pursuant to and in accordance with the express terms of this Agreement or any
payment obtained by a Lender as consideration for the assignment of or sale of
a participation in any of its Loans to any assignee or participant, other than
to the Borrower or any Subsidiary or Affiliate thereof (as to which the
provisions of this paragraph shall apply). 
The Borrower consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against the
Borrower rights of set-off and counterclaim with respect to such participation
as fully as if such Lender were a direct creditor of the Borrower in the amount
of such participation.

 

(d)                                 Unless the Administrative Agent shall
have received notice from the Borrower prior to the date on which any payment
is due to the Administrative Agent for the account of the Lenders hereunder
that the Borrower will not make such payment, the Administrative Agent may
assume that the Borrower has made such payment on such date in accordance
herewith and may, in reliance upon such assumption, distribute to the Lenders
the amount due.  In such event, if the
Borrower has not in fact made such payment, then each of the Lenders severally
agrees to repay to the Administrative Agent forthwith on demand the amount so
distributed to such Lender 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 

 

30

 

the greater of the Federal Funds Effective Rate and a
rate determined by the Administrative Agent in accordance with banking industry
rules on interbank compensation.  A
notice of the Administrative Agent to any Lender with respect to any amount
owing under this subsection (d) shall be conclusive, absent
manifest error.

 

(e)                                  The obligations of the Lenders hereunder
to make Loans and to make payments pursuant to Section 9.03(c) are
several and not joint.  The failure of
any Lender to make any Loan or to make any payment under Section 9.03(c) on
any date required hereunder shall not relieve any other Lender of its
corresponding obligation to do so on such date, and no Lender shall be
responsible for the failure of any other Lender to so make its Loan or to make
its payment under Section 9.03(c).

 

(f)                                    If any Lender shall fail to make any
payment required to be made by it pursuant to Sections 2.04(c), 2.14(d) or
9.03(c), then the Administrative Agent may, in its discretion
(notwithstanding any contrary provision hereof), apply any amounts thereafter
received by the Administrative Agent for the account of such Lender to satisfy
such Lender’s obligations under such Sections until all such unsatisfied
obligations are fully paid.

 

SECTION 2.15. 
Mitigation Obligations; Replacement of Lenders.  (a)  If any Lender requests compensation
under Section 2.11, or if the Borrower is required to pay any
additional amount to any Lender or any Governmental Authority for the account
of any Lender pursuant to Section 2.13, or if the Borrower is
required to pay any additional amount as a result of a Lender, pursuant to Section 2.02(b),
making its Loans through a particular domestic or foreign branch of such Lender
or through an Affiliate of such Lender, then such Lender shall use reasonable
efforts to designate a different lending office for funding or booking its
Loans hereunder or to assign its rights and obligations hereunder to another of
its offices, branches or Affiliates, if, in the judgment of such Lender, such
designation or assignment (i) would eliminate or reduce amounts payable
pursuant to Section 2.11 or 2.13 or as a result of the
exercise of its discretion under Section 2.02(b), as the case may
be, in the future, and (ii) would not subject such Lender to any
unreimbursed cost or expense and would not otherwise be disadvantageous to such
Lender.  The Borrower hereby agrees to
pay all reasonable costs and expenses incurred by any Lender in connection with
any such designation or assignment.

 

(b)                                 If any Lender requests compensation under
Section 2.11, or if the Borrower is required to pay any additional
amount to any Lender or any Governmental Authority for the account of any
Lender pursuant to Section 2.13, or if any Lender is a Defaulting
Lender, then the Borrower may, at its sole expense and effort, upon notice to
such Lender and the Administrative Agent, require such Lender to assign and
delegate, without recourse (in accordance with and subject to the restrictions
contained in, and consents required by, Section 9.04), all of its
interests, rights and obligations under this Agreement and the related Loan
Documents to an assignee that shall assume such obligations (which assignee may
be another Lender, if a Lender accepts such assignment), provided that: (i) the
Borrower shall have paid to the Administrative Agent the assignment fee specified
in Section 9.04, (ii) such Lender shall have received payment
of an amount equal to the outstanding principal of its Loans, accrued interest
thereon, accrued fees and all other amounts payable to it hereunder and under
the other Loan Documents from the assignee (to the extent of such outstanding
principal and accrued 

 

31

 

interest and fees) or the Borrower (in the case of all
other amounts), (iii) in the case of any such assignment resulting from a
claim for compensation under Section 2.11 or payments required to
be made pursuant to Section 2.13, such assignment will result in a
reduction in such compensation or payments, and (iv) such assignment does
not conflict with any applicable law.  A
Lender shall not be required to make any such assignment and delegation if,
prior thereto, as a result of a waiver by such Lender or otherwise, the
circumstances entitling the Borrower to require such assignment and delegation
cease to apply.

 

SECTION 2.16. 
Increase in Commitments.

 

(a)                                  Provided no Default has occurred and is
continuing, upon notice to the Administrative Agent (which shall promptly
notify the Lenders), the Borrower may from time to time, request an increase in
the aggregate amount of the Commitments by an amount (for all such requests)
not exceeding $75,000,000 in the aggregate; provided that any such
request for an increase shall be in a minimum amount of $10,000,000.  Any such increase in the aggregate
Commitments may be provided by any Lender willing to participate in such
increase (each such Lender, a “Participating Lender”), or, subject to
the approval of the Administrative Agent, Eligible Assignees designated by the
Borrower that are willing to participate in such increase (each, an “Increasing
Lender”) and to become Lenders pursuant to a “Joinder Agreement”, in form
and substance reasonably satisfactory to the Administrative Agent, pursuant to
which such Increasing Lender shall become a party to this Agreement.  The Administrative Agent and the Borrower
shall determine (A) the final allocation of such increase among the
Participating Lenders and Increasing Lenders and Schedule 2.01 attached
hereto shall be automatically updated to reflect the same and (B) the
effective date (the “Increase Effective Date”) of any such
increase.  Nothing contained herein shall
constitute, or otherwise be deemed to be, a commitment on the part of any
Lender to increase its Commitment hereunder.

 

(b)                                 As a condition precedent to such
increase, the Borrower shall deliver to the Administrative Agent a certificate
of the Borrower dated as of the Increase Effective Date (in sufficient copies
for each Lender) signed by a duly authorized officer of the Borrower (i) certifying
and attaching the resolutions adopted by the Borrower approving or consenting
to such increase (which may be covered in resolutions authorizing Borrowings on
and after the Closing Date), and (ii) certifying that, before and after
giving effect to such increase, (A) the representations and warranties
contained in Article III and the other Loan Documents are true and
correct on and as of the Increase Effective Date, except to the extent that
such representations and warranties specifically refer to an earlier date, in
which case they are true and correct as of such earlier date, and except that
for purposes of this Section 2.16, the representations and
warranties contained in Section 3.04(a) shall be deemed to
refer to the most recent financial statements furnished in connection with the
statements delivered pursuant to clauses (a) and (b) of
Section 5.01, and (B) no Default has occurred and is
continuing.  The Borrower shall prepay
any Loans outstanding on the Increase Effective Date (and pay any additional
amounts required pursuant to Section 2.12) to the extent necessary
to keep the outstanding Loans ratable with any revised Applicable Percentages
arising from any nonratable increase in the Commitments under this Section.

 

32

 

(c)                                  This Section 2.16 shall
supersede any provisions in Section 2.14(c) or Section 9.02
to the contrary.

 

SECTION 2.17. 
Defaulting Lenders. 
Notwithstanding anything to the contrary contained in this Agreement, if
any Lender becomes a Defaulting Lender, then, until such time as such Lender is
no longer a Defaulting Lender, to the extent permitted by applicable law:

 

(a)                                  Waivers and Amendments. 
Such Defaulting Lender’s right to approve or disapprove any amendment,
waiver or consent with respect to this Agreement shall be restricted as set
forth in Section 9.02.

 

(b)                                 Reallocation of Loan Payments. Any payment or prepayment (i) of
any portion of the principal amount of Loans of such Lender (whether voluntary
or mandatory, at maturity, pursuant to Article VII or otherwise)
shall be applied, first, to the Loans of other Lenders as if such
Defaulting Lender had no Loans outstanding, until such time as the outstanding
principal amount of all Loans of each Lender shall equal its pro rata share
thereof based on its Applicable Percentage, ratably to the Lenders in
accordance with their Applicable Percentages of Loans being repaid or prepaid;
and second, to the then outstanding amounts (including interest thereon)
owed under the terms hereof by such Defaulting Lender to the Administrative
Agent or (to the extent the Administrative Agent has received notice thereof)
to any other Lender, ratably to the Persons entitled thereto, and (ii) any
other amounts thereafter received by the Administrative Agent for the account
of such Defaulting Lender (including amounts made available to the
Administrative Agent by such Defaulting Lender pursuant to Section 9.08)
to have been paid to such Defaulting Lender and applied on behalf of such
Defaulting Lender, to the liabilities above referred to in item second of
clause (i) above.  Any of such
amounts as are reallocated pursuant to this subsection 2.17(b) that
are payable or paid (including pursuant to Section 9.08) to such
Defaulting Lender shall be deemed paid to such Defaulting Lender and applied by
the Administrative Agent on behalf of such Defaulting Lender, and each Lender
hereby irrevocably consents thereto.

 

(c)                                  Fees. Such Defaulting Lender right to any facility fee
shall be limited as provided in Section 2.08.

 

A
Lender that has become a Defaulting Lender because of an event referenced in
the definition of Defaulting Lender may cure such status and shall no longer
constitute a Defaulting Lender as a result of such event when (i) such
Defaulting Lender shall have fully funded or paid, as applicable, all Loans or
other amounts required to be funded or paid by it hereunder as to which it is
delinquent (together, in each case, with such interest thereon as shall be
required to any Person as otherwise provided in this Agreement), (ii) the
Administrative Agent and the Borrower shall have received a certification by
such Defaulting Lender of its ability and intent to comply with the provisions
of this Agreement going forward, and (iii) each of (x) the
Administrative Agent, (y) any other Lender as to which a delinquent
obligation was owed, and (z) in the case of the failure to fund any Loan,
the Borrower, shall have determined (and notified the Administrative Agent)
that they are satisfied, in their sole discretion, that such Defaulting Lender
intends to continue to perform its obligations as a Lender hereunder and has
all approvals required to enable it, to continue to perform its obligations as
a Lender hereunder.  No reference in this
subsection to an event being “cured” shall by itself preclude any claim by any
Person 

 

33

 

against
any Lender that becomes a Defaulting Lender for such direct damages as may
otherwise be available to such Person arising from any failure to fund or pay
any amount when due hereunder or from any other event that gave rise to such
Lender’s status as a Defaulting Lender.

 

This Section 2.17 shall supersede any
provisions in Section 2.14(c) or Section 9.02 to
the contrary.

 

ARTICLE III

 

Representations
and Warranties

 

The Borrower represents and
warrants to the Lenders that:

 

SECTION 3.01. 
Organization; Powers.  The
Borrower is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization, and has all requisite power and
authority to carry on its business as now conducted.  Each Subsidiary of the Borrower is duly
organized, validly existing under the laws of the jurisdiction of its
organization, has all requisite power and authority to carry on its business as
now conducted and, except as set forth on Schedule 3.01, is in good
standing under the laws of the jurisdiction of its organization.  Except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect, each of the Borrower and its Subsidiaries (a) is
qualified to do business in, and is in good standing in, every jurisdiction
where such qualification is required and (b) has all requisite
governmental licenses, authorizations, consents and approvals to own or lease
its assets.

 

SECTION 3.02. 
Authorization; Enforceability. 
The Transactions are within the Borrower’s corporate powers and have
been duly authorized by all necessary corporate and, if required, stockholder
action.  This Agreement and the other
Loan Documents have been duly executed and delivered by the Borrower and
constitute a legal, valid and binding obligation of the Borrower, enforceable
in accordance with its terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other laws affecting creditors’ rights generally
and subject to general principles of equity, regardless of whether considered
in a proceeding in equity or at law.

 

SECTION 3.03. 
Governmental Approvals; No Conflicts.  The Transactions (a) do not require any
consent or approval of, registration or filing with, or any other action by,
any Governmental Authority or any other Person, except such as have been
obtained or made and are in full force and effect, (b) will not violate
any Requirement of Law, (c) will not violate or result in a default under
any indenture, agreement or other instrument binding upon the Borrower or any
of its Subsidiaries or its assets, or give rise to a right thereunder to
require any payment to be made by the Borrower or any of its Subsidiaries, and (d) will
not result in the creation or imposition of any Lien on any asset of the
Borrower or any of its Subsidiaries.

 

SECTION 3.04. 
Financial Condition; No Material Adverse Effect.  (a)  The Borrower has heretofore
furnished to the Lenders its consolidated balance sheet and statements of
income, stockholders equity and cash flows (i) as of and for the fiscal
years ended 2007 and 2008, reported on by KPMG LLP, an independent registered
public accounting firm, and (ii) as 

 

34

 

of and
for the fiscal quarters and the portion of the fiscal year ended March 31,
2009 and June 30, 2009, certified by its chief financial officer.  Such financial statements present fairly, in
all material respects, the financial position and results of operations and
cash flows of the Borrower and its consolidated Subsidiaries as of such dates
and for such periods in accordance with GAAP, subject to year-end audit
adjustments and the absence of footnotes in the case of the statements referred
to in clause (ii) above.  The
Borrower and its Subsidiaries do not have any Guarantees, contingent
liabilities, or any long-term leases or unusual forward or long-term
commitments, including any interest rate or foreign currency swap or exchange
transaction or other obligation in respect of derivatives, in each case, that
are required by GAAP to be reflected or disclosed in such financial statements,
that are not reflected or disclosed in the most recent financial statements
referred to in this paragraph, except as disclosed on Schedule 3.04.

 

(b)                                 Since December 31, 2008, there has
been no event, development or circumstance that has had or could reasonably be
expected, either individually or in the aggregate, to have a Material Adverse
Effect (other than the Disclosed Matters).

 

SECTION 3.05. 
Properties.  (a)  Each
of the Borrower and its Subsidiaries has good title to, or valid leasehold
interests in, all its real and personal property material to its business, and
none of such property is subject to any Lien except as permitted by Section 6.03.

 

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

 

SECTION 3.06. 
Litigation and Environmental Matters.  (a)  There are no actions, suits or
proceedings by or before any arbitrator or Governmental Authority pending
against or, to the knowledge of the Borrower, threatened against or affecting
the Borrower or any of its Subsidiaries (i) as to which there is a
reasonable possibility of an adverse determination and that, if adversely
determined, could reasonably be expected, individually or in the aggregate, to
result in a Material Adverse Effect (other than the Disclosed Matters), or (ii) that
involve this Agreement, the other Loan Documents or the Transactions.

 

(b)                                 Except for the Disclosed Matters and
except with respect to any other matters that, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect, neither the Borrower nor any of its Subsidiaries (i) has failed to
comply with any Environmental Law or to obtain, maintain or comply with any
permit, license or other approval required under any Environmental Law, (ii) has
become subject to any Environmental Liability, (iii) has received notice
of any claim with respect to any Environmental Liability, or (iv) knows of
any basis for any Environmental Liability.

 

(c)                                  Since the date of this Agreement, there has
been no change in the status of the Disclosed Matters that, individually or in
the aggregate, has resulted in, or materially increased the likelihood of, a
Material Adverse Effect.

 

35

 

SECTION 3.07. 
Compliance with Laws and Agreements.  Each of the Borrower and its Subsidiaries is
in compliance with all Requirements of Laws applicable to it or its property
and all Contractual Obligations (including any material investment advisory or
management agreements) binding upon it or its property, except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect.

 

SECTION 3.08. 
Investment and Holding Company Status.  (a)  Neither the Borrower nor any of its
Subsidiaries is (i) an “investment company”, or a company “controlled” by
an “investment company”, each as defined in, or subject to regulation under,
the Investment Company Act of 1940, or (ii) a “holding company” as defined
in, or subject to regulation under, the Public Utility Holding Company Act of
2005.  Except for net capital and other
requirements imposed on registered broker-dealers, neither the Borrower nor any
of its Subsidiaries is subject to any regulation under any Requirement of Law
(other than Regulation X of the Board) that limits its ability to incur
Indebtedness.

 

(b)                                 The Borrower and each Subsidiary of the
Borrower which is engaged in investment advisory or investment management
activities is, and at all times will be, duly registered as an investment
adviser as and to the extent required under the Investment Advisers Act of
1940, as amended; and each Subsidiary of the Borrower which is engaged in
broker-dealer business is, and at all times will be, duly registered as a broker-dealer
as and to the extent required under the Securities Exchange Act of 1934, as
amended, and, as and to the extent required, is, and at all times will be, a
member in good standing of the Financial Industry Regulatory Authority.

 

SECTION 3.09. 
Taxes.  Each of the
Borrower and its Subsidiaries has timely filed or caused to be filed all Tax
returns and reports required to have been filed and has paid or caused to be
paid all Taxes required to have been paid by it, except (a) Taxes that are
being contested in good faith by appropriate proceedings and for which the
Borrower or such Subsidiary, as applicable, has set aside on its books adequate
reserves, or (b) to the extent that the failure to do so could not
reasonably be expected to result in a Material Adverse Effect.

 

SECTION 3.10. 
ERISA.  No ERISA Event has
occurred or is reasonably expected to occur that, when taken together with all
other such ERISA Events for which a liability is reasonably expected to occur,
could reasonably be expected to result in a Material Adverse Effect.  The present value of all accumulated benefit
obligations of all underfunded Plans (based on the assumptions used for
purposes of Statement of Financial Accounting Standards No. 158) did not,
as of the date of the most recent audited financial statements reflecting such
amounts, exceed by more than $10,000,000 the fair market value of the assets of
all such underfunded Plans.

 

SECTION 3.11. 
Disclosure.  The Borrower
has disclosed or made available to the Lenders all agreements and instruments
to which it or any of its Subsidiaries is subject, and all other matters known
to it, that, individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect.  None
of the reports, financial statements, certificates or other information
furnished by or on behalf of the Borrower to the Administrative Agent or any
Lender in connection with the execution and delivery of this Agreement or the
other Loan 

 

36

 

Documents
or furnished to the Lenders pursuant hereto or thereto (as modified or
supplemented by other information so furnished) contains any material
misstatement of fact or omits to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided that, with respect to projected financial
information and forward-looking statements, the Borrower represents only that
such information was prepared in good faith based upon assumptions believed to
be reasonable at the time.

 

SECTION 3.12. 
No Default.  Neither the
Borrower nor any of its Subsidiaries is in default under or with respect to any
of its Contractual Obligations in any respect that could reasonably be expected
to have a Material Adverse Effect.  No
Default or Event of Default has occurred and is continuing or would result from
the consummation of the transactions contemplated by this Agreement or any
other Loan Document.

 

SECTION 3.13. 
Subsidiaries.  Except as
disclosed to the Administrative Agent by the Borrower in writing from time to
time after the Closing Date, Part (a) of Schedule 3.13 sets
forth the name and jurisdiction of incorporation of each Subsidiary and, as to
each such Subsidiary, the percentage of each class of Capital Stock owned by
the Borrower.  There are no outstanding
subscriptions, options, warrants, calls, rights or other agreements or
commitments (other than stock options or restricted stock granted to employees
or directors and directors’ qualifying shares) of any nature relating to any
Capital Stock of the Borrower or any Subsidiary.  The Borrower has no equity investments in any
other corporation or entity other than those specifically disclosed in Part (b) of
Schedule 3.13.  All of the outstanding
Capital Stock of the Subsidiaries owned by the Borrower have been validly
issued, are fully paid and nonassessable and are owned free and clear of all
Liens.  All of the outstanding Capital
Stock in the Borrower has been validly issued and are fully paid and
nonassessable.

 

SECTION 3.14. 
Federal Regulations.  No
part of the proceeds of any Loans will be used for “buying” or “carrying” any “margin
stock” within the respective meanings of each of the quoted terms under
Regulation U as now and from time to time hereafter in effect in any manner
that violates the provisions of the Regulations of the Board or for any other
purpose that violates the provisions of the Regulations of the Board.  If requested by any Lender or the
Administrative Agent, the Borrower will furnish to the Administrative Agent and
each Lender a statement to the foregoing effect in conformity with the
requirements of FR Form G-3 or FR Form U-1, as applicable, referred
to in Regulation U.  No more than 25% of
the consolidated assets of the Borrower and its Subsidiaries (excluding
treasury shares) consist of “margin stock” under Regulation U as now and from
time to time hereafter in effect.

 

SECTION 3.15. 
No Burdensome Restrictions. 
No Requirement of Law or Contractual Obligation of the Borrower could
reasonably be expected to have a Material Adverse Effect.

 

SECTION 3.16. 
Insurance.  The properties
of the Borrower and its Subsidiaries are insured with financially sound and
reputable insurance companies not Affiliates of the Borrower, in such amounts,
with such deductibles and covering such risks as are customarily carried by
companies engaged in similar businesses and owning similar properties in
localities where the Borrower or the applicable Subsidiary operates.

 

37

 

SECTION 3.17. 
Taxpayer Identification Number. 
The Borrower’s true and correct U.S. taxpayer identification number is
set forth on Schedule 9.01.

 

ARTICLE IV

 

Conditions

 

SECTION 4.01. 
Conditions to Closing Date. 
The obligations of the Lenders to make Loans hereunder shall not become
effective until the date on which each of the following conditions precedent is
satisfied (or waived in accordance with Section 9.02):

 

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

 

(i)                                     executed counterparts of this Agreement,
sufficient in number for distribution to the Administrative Agent, each Lender
and the Borrower;

 

(ii)                                  a Note executed by the Borrower in favor
of each Lender requesting a Note;

 

(iii)                               such documents and certificates as the
Administrative Agent or its counsel may reasonably request relating to the
organization, existence and good standing of the Borrower, the authorization of
the Transactions and any other legal matters relating to the Borrower, this
Agreement, the other Loan Documents or the Transactions;

 

(iv)                              a favorable written opinion (addressed to
the Administrative Agent and the Lenders) of Daniel C. Schulte, the general
counsel of the Borrower, covering such matters relating to the Borrower, this
Agreement, the other Loan Documents or the Transactions as the Administrative
Agent and the Required Lenders shall reasonably request;

 

(v)                                 a favorable written opinion (addressed to
the Administrative Agent and the Lenders) of Fulbright & Jaworski
L.L.P., counsel to the Borrower, as to the enforceability of this Agreement and
the other Loan Documents;

 

(vi)                              a certificate signed by the President, a
Vice President or a Financial Officer of the Borrower, certifying (a) that
the representations and warranties of the Borrower set forth in this Agreement
are true and correct on and as of the Closing Date, (b) that no Default has
occurred and is continuing as of the Closing Date or would result from any
Borrowing to occur on the Closing Date, (c) that since December 31,
2008, there has been no event, development or circumstance that has had or
could reasonably be expected, either individually or in the aggregate, to have
a Material Adverse Effect, and (d) the current Debt Ratings of the
Borrower;

 

38

 

(vii)                           incumbency certificates and/or other
certificates of duly authorized officers of the Borrower as the Administrative
Agent may require evidencing the identity, authority and capacity of each
officer of the Borrower authorized to act on behalf of the Borrower in
connection with this Agreement and the other Loan Documents;

 

(viii)                        evidence that the Existing Credit
Agreement has been or concurrently with the Closing Date is being terminated;

 

(ix)                                such other assurances, certificates,
documents, consents or opinions as the Administrative Agent or the Required
Lenders reasonably may require.

 

(b)                                 The Administrative Agent shall have
received all fees and other amounts due and payable on or prior to the Closing
Date, including, to the extent invoiced, reimbursement or payment of all
reasonable out-of-pocket expenses (including, without limitation, fees, charges
and disbursements of counsel to the Administrative Agent (directly to such
counsel if requested by the Administrative Agent)) required to be reimbursed or
paid by the Borrower hereunder.

 

(c)                                  All governmental and third party
approvals necessary in connection with the continuing operations of the
Borrower and its Subsidiaries and the transactions contemplated hereby shall
have been obtained and be in full force and effect, and all applicable waiting
periods shall have expired without any action being taken or threatened by any
competent authority that would restrain, prevent or otherwise impose adverse
conditions on the financing contemplated hereby.

 

(d)                                 The Lenders shall have received (a) audited
consolidated financial statements of the Borrower for the 2007 and 2008 fiscal
years, and (b) unaudited interim consolidated financial statements of the
Borrower for each quarterly period ended subsequent to the date of the latest
applicable financial statements delivered pursuant to clause (a) of
this paragraph as to which such financial statements are available, and such
financial statements shall not, in the reasonable judgment of the Lenders,
reflect any material adverse change in the consolidated financial condition of
the Borrower, as reflected in the financial statements or projections contained
in the Confidential Information Memorandum.

 

(e)                                  The Closing Date shall have occurred on
or before October 5, 2009.

 

The Administrative Agent shall notify the Borrower
and the Lenders of the Closing Date, and such notice shall be conclusive and
binding.  Notwithstanding the foregoing,
the obligations of the Lenders to make Loans hereunder shall not become
effective unless each of the foregoing conditions is satisfied (or waived
pursuant to Section 9.02) at or prior to 5:00 p.m., New York
City time, on October 5, 2009 (and, in the event such conditions are not
so satisfied or waived, the Commitments shall terminate at such time).

 

Without limiting the generality of the provisions of
the last paragraph of Section 8.03, for purposes of determining
compliance with the conditions specified in this Section 4.01, each
Lender that has signed this Agreement shall be deemed to have consented to,
approved or accepted or to be satisfied with, each document or other matter
required thereunder to be consented to or approved by or acceptable or
satisfactory to a Lender unless the Administrative 

 

39

 

Agent shall have received notice from such Lender
prior to the proposed Closing Date specifying its objection thereto.

 

SECTION 4.02. 
Each Credit Event.  The
obligation of each Lender to make a Loan on the occasion of any Borrowing
(including, without limitation, its initial Loan) is subject to the
satisfaction of the following conditions:

 

(a)                                  The representations and warranties of the
Borrower set forth in this Agreement (with the exception of the representation
and warranty contained in Section 3.04(b)) shall be true and
correct on and as of the date of such Borrowing except to the extent that such
representations and warranties specifically refer to an earlier date, in which
case they shall be true and correct as of such earlier date, and except that
for purposes of this Section 4.02, the representations and
warranties contained in Section 3.04(a) shall be deemed to
refer to the most recent financial statements furnished in connection with the
statements delivered pursuant to clauses (a) and (b) of
Section 5.01, as applicable.

 

(b)                                 At the time of and immediately after
giving effect to such Borrowing, no Default shall have occurred and be
continuing.

 

(c)                                  The Administrative Agent shall have
received a Revolving Borrowing Request in accordance with the requirements
hereof.

 

Each Borrowing and the increase of the aggregate
Commitments pursuant to Section 2.16 shall be deemed to constitute
a representation and warranty by the Borrower on the date thereof as to the
matters specified in paragraphs (a) and (b) of this Section (with
references to “such Borrowing” being deemed to be references to any such
increase, as appropriate), provided that such increase of the aggregate
Commitments shall also be deemed to constitute a representation and warranty by
the Borrower that the matters specified in Section 3.04(b) are
true and correct on and as of the date thereof.

 

ARTICLE V

 

Affirmative
Covenants

 

Until the Commitments have expired or been
terminated and the principal of and interest on each Loan and all fees and
other amounts payable hereunder shall have been paid in full, the Borrower
covenants and agrees with the Lenders that:

 

SECTION 5.01. 
Financial Statements and Other Information.  The Borrower will furnish to the
Administrative Agent and each Lender:

 

(a)                                  within 90 days after the end of each
fiscal year of the Borrower, the annual report of the Borrower on Form 10-K
filed by the Borrower with the SEC;

 

(b)                                 within 45 days after the end of each of
the first three fiscal quarters of each fiscal year of the Borrower, the
quarterly report of the Borrower on Form 10-Q filed by the Borrower with
the SEC;

 

40

 

(c)                                  concurrently with any delivery of
financial statements under clause (a) or (b) above, a
Compliance Certificate signed by a Financial Officer of the Borrower (i) certifying
as to whether a Default has occurred and, if a Default has occurred, specifying
the details thereof and any action taken or proposed to be taken with respect
thereto, (ii) setting forth reasonably detailed calculations demonstrating
compliance with Section 6.01, and (iii) stating whether any
change in GAAP or in the application thereof has occurred since the date of the
audited financial statements referred to in Section 3.04 and, if
any such change has occurred, specifying the effect of such change on the
financial statements accompanying such certificate;

 

(d)                                 promptly after the same become publicly
available, copies of all annual reports on Form 10-K, all quarterly
reports on Form 10-Q, all reports on Form 8-K (except for such
reports required to be filed pursuant to Item 2.02 of Form 8-K) and all
proxy statements, filed by the Borrower or any Subsidiary with the SEC, or with
any national securities exchange, or distributed by the Borrower to its
shareholders generally, as the case may be;

 

(e)                                  after the end of each calendar month, (i) a
schedule of the Net Asset Value of the investment companies and accounts
managed by the Borrower and its Subsidiaries on the last day of such calendar
month and certain other information, substantially in the form of Exhibit C-1,
and (ii) a schedule showing the calculation of the Aggregate Revenue Base
as of the end of such calendar month, and an analysis of changes from the
preceding calendar month, substantially in the form of Exhibit C-2,
or in such other form as may be reasonably satisfactory to the Administrative
Agent;

 

(f)                                    promptly, and in any event within five
Business Days after receipt thereof by the Borrower or any of its Subsidiaries,
copies of each notice or other correspondence received from the SEC (or
comparable agency in any applicable non-U.S. jurisdiction) concerning any
non-routine investigation or possible non-routine investigation or other
non-routine inquiry by such agency regarding financial or other operational
results of the Borrower or any of its Subsidiaries;

 

(g)                                 promptly after the furnishing thereof,
copies of any statement or report furnished to any holder of debt securities of
the Borrower or any of its Subsidiaries pursuant to the terms of any indenture,
loan or credit or similar agreement and not otherwise required to be furnished
to the Lenders pursuant to any other clause of this Section 5.01;
and

 

(h)                                 promptly following any request therefor,
such other information regarding the operations, business affairs and financial
condition of the Borrower or any Subsidiary, or compliance with the terms of
this Agreement and the other Loan Documents, as the Administrative Agent or any
Lender may reasonably request.

 

Documents required to be delivered pursuant
to paragraphs (a), (b) and (d) of this Section 5.01 (to
the extent any such documents are included in materials otherwise filed with
the SEC) shall be deemed to have been delivered on the date on which the
Borrower provides notice to the Administrative Agent and/or the Lenders, as
required, as the case may be, that such documents have been posted on the
Borrower’s website on the Internet at the website address listed on Schedule
9.01 or at such other website address listed in such notice and accessible
by the Administrative Agent and the Lenders without charge (whether a
commercial, third-party 

 

41

 

website or whether sponsored
by the Administrative Agent); provided that the Borrower shall deliver
paper copies of the reports and financial statements referred to in paragraphs
(a), (b) and (d) of this Section 5.01 to the
Administrative Agent or any Lender who requests the Borrower to deliver such
paper copies until written notice to cease delivering paper copies is given by
the Administrative Agent or such Lender.  The Administrative Agent shall have no
obligation to request the delivery or to maintain copies of the documents
referred to above, and in any event shall have no responsibility to monitor
compliance by the Borrower with any such request for delivery, and each Lender
shall be solely responsible for requesting delivery to it or maintaining its
copies of such documents.

 

The Borrower hereby acknowledges that (a) the
Administrative Agent and/or the Arranger will make available to the Lenders
materials and/or information provided by or on behalf of the Borrower hereunder
(collectively, “Borrower Materials”) by posting the Borrower Materials
on IntraLinks or another similar electronic system (the “Platform”) and (b) certain
of the Lenders (each, a “Public Lender”) may have personnel who do not
wish to receive material non-public information with respect to the Borrower or
its Affiliates, or the respective securities of any of the foregoing, and who
may be engaged in investment and other market-related activities with respect
to such Persons’ securities.  The
Borrower hereby agrees that (w) all Borrower Materials that are to be made
available to Public Lenders shall be clearly and conspicuously marked “PUBLIC”
which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently
on the first page thereof; (x) by marking Borrower Materials “PUBLIC,”
the Borrower shall be deemed to have authorized the Administrative Agent, the
Arranger and the Lenders to treat such Borrower Materials as not containing any
material non-public information with respect to the Borrower or its securities
for purposes of United States Federal and state securities laws (provided,
however, that to the extent such Borrower Materials constitute
Information, they shall be treated as set forth in Section 9.12); (y) all
Borrower Materials marked “PUBLIC” are permitted to be made available through a
portion of the Platform designated “Public Side Information;” and (z) the
Administrative Agent and the Arranger shall be entitled to treat any Borrower
Materials that are not marked “PUBLIC” as being suitable only for posting on a
portion of the Platform that is not designated “Public Side Information.”  Notwithstanding
the foregoing, the Borrower shall be under no obligation to mark any Borrower
Materials “PUBLIC.”

 

SECTION 5.02. 
Notices of Material Events. 
The Borrower will furnish to the Administrative Agent and each Lender
prompt written notice of the following:

 

(a)                                  the occurrence of any Default;

 

(b)                                 the filing or commencement of any action,
suit or proceeding by or before any arbitrator or Governmental Authority
against or affecting the Borrower or any Affiliate thereof that, if adversely
determined, could reasonably be expected to result in a Material Adverse
Effect;

 

(c)                                  the occurrence of any ERISA Event that,
alone or together with any other ERISA Events that have occurred, could
reasonably be expected to result in liability of the Borrower and its
Subsidiaries in an aggregate amount exceeding $5,000,000;

 

42

 

(d)                                 any
suspension or termination of the registration of the Borrower or any of its
Subsidiaries as an investment adviser under the Investment Advisers Act of
1940, as amended, or any cancellation or expiration without renewal of any
material investment advisory agreement or similar contract to which the
Borrower or any of its Subsidiaries is a party;

 

(e)                                  of
any material change in accounting policies or financial reporting practices by
the Borrower or any Subsidiary;

 

(f)                                    of
any announcement by Moody’s or S&P of any change in a Debt Rating; and

 

(g)                                 any
other development that results in, or could reasonably be expected to result
in, a Material Adverse Effect.

 

Each notice delivered under this Section shall be accompanied by a
statement of a Financial Officer or other executive officer of the Borrower
setting forth the details of the event or development requiring such notice and
any action taken or proposed to be taken with respect thereto.  The Borrower may, by delivering to the
Administrative Agent written notice specifically referring to this Section 5.02,
notify the Lenders that the Borrower wishes to amend any Schedule to this
Agreement to include information about events, occurrences, or transactions
arising after the Closing Date that would render untrue any representation or
warranty by the Borrower under or pursuant to this Agreement.  Such amendment will be deemed effective as of
the date that such notice is delivered to the Administrative Agent upon the
Administrative Agent giving notice to the Borrower and the Lenders within 10
Business Days from the receipt thereof that the Required Lenders have consented
thereto; provided, however, that the consent of the Required
Lenders shall not be required to amend Schedule 3.13 and Schedule
9.01.

 

SECTION 5.03.  Existence; Conduct of Business.  The Borrower will, and will cause each of its
Subsidiaries to, (a) do or cause to be done all things necessary to
preserve, renew and keep in full force and effect its legal existence and good
standing under the laws of the jurisdiction of its organization and the rights,
licenses, permits, privileges and franchises material to the conduct of its
business; provided that the foregoing shall not prohibit any merger,
consolidation, liquidation or dissolution permitted under Section 6.04,
and (b) comply with all Contractual Obligations and Requirements of Law
except to the extent that failure to comply therewith could not, in the
aggregate, reasonably be expected to have a Material Adverse Effect.

 

SECTION 5.04.  Payment of Obligations.  The Borrower will, and will cause each of its
Subsidiaries to, pay its obligations, including Tax liabilities, that, if not
paid, could result in a Material Adverse Effect before the same shall become
delinquent or in default, except where (a) the validity or amount thereof
is being contested in good faith by appropriate proceedings, (b) the
Borrower or such Subsidiary has set aside on its books adequate reserves with
respect thereto in accordance with GAAP, and (c) the failure to make
payment pending such contest could not reasonably be expected to result in a
Material Adverse Effect.

 

SECTION 5.05.  Maintenance of Properties; Insurance.  The Borrower will, and will cause each of its
Subsidiaries to, (a) keep and maintain all property material to the
conduct of its business in good working order and condition, ordinary wear and
tear excepted, and (b) 

 

43

 

maintain, with
financially sound and reputable insurance companies not Affiliates of the
Borrower, insurance in such amounts and against such risks as are customarily
maintained by companies engaged in the same or similar businesses operating in
the same or similar locations.

 

SECTION 5.06.  Books and Records; Inspection Rights.  The Borrower will, and will cause each of its
Subsidiaries to, (a) keep proper books of record and account in which
full, true and correct entries in conformity with GAAP consistently applied
shall be made of all dealings and transactions in relation to its business and
activities, and (b) maintain such books of record and account in material
conformity with all applicable requirements of any Governmental Authority
having regulatory jurisdiction over the Borrower or such Subsidiary, as the
case may be.  The Borrower will, and will
cause each of its Subsidiaries to, permit any representatives designated by the
Administrative Agent or any Lender, upon reasonable prior notice, to visit and
inspect its properties, to examine and make extracts from its books and
records, and to discuss its affairs, finances and condition with its officers
and independent accountants, all at such reasonable times and as often as
reasonably requested; provided, however, that upon the occurrence
and during the continuance of an Event of Default, the Administrative Agent or
any Lender (or any of their respective representatives or independent
contractors) may do any of the foregoing at the expense of the Borrower at any
time during normal business hours and without advance notice.

 

SECTION 5.07.  Compliance with Laws.  The Borrower will, and will cause each of its
Subsidiaries to, comply with all Requirements of Laws applicable to it or its
property and maintain all registrations and memberships with any Governmental
Authority, except where the failure to do so, individually or in the aggregate,
could not reasonably be expected to result in a Material Adverse Effect.

 

SECTION 5.08.  Use of Proceeds.  The proceeds of the Loans will be used to
finance the payment by the Borrower of outstanding Indebtedness under the
Existing Credit Agreement, to pay related fees and expenses and for general
corporate purposes not in contravention of any law, including but not limited (a) to
repurchase shares of the Borrower’s Class A Common Stock, and (b) to
consummate Permitted Acquisitions.  No
part of the proceeds of any Loan will be used, whether directly or indirectly,
for any purpose that entails a violation of any of the Regulations of the
Board, including Regulations U and X.

 

SECTION 5.09.  Environmental Laws.  The Borrower will, and will cause each of its
Subsidiaries to, (a) comply with all applicable Environmental Laws, and
obtain and comply with and maintain any and all licenses, approvals,
notifications, registrations or permits required by applicable Environmental
Laws, and (b) conduct and complete all investigations, studies, sampling
and testing, and all remedial, removal and other actions required under
Environmental Laws and promptly comply in all material respects with all lawful
orders and directives of all Governmental Authorities regarding Environmental
Laws, except in each case to the extent that non-compliance therewith could not
reasonably be expected to result in a Material Adverse Effect.

 

44

 

ARTICLE VI

 

Negative Covenants

 

Until the Commitments have expired or been
terminated and the principal of and interest on each Loan and all fees and
other amounts payable hereunder shall have been paid in full, the Borrower
covenants and agrees with the Lenders that:

 

SECTION 6.01.  Financial Condition Covenants.

 

(a)                                  Consolidated
Leverage Ratio.  The Borrower shall
not permit the Consolidated Leverage Ratio as at the last day of any Reference
Period to equal or exceed the ratio of 3.0 to 1.0.

 

(b)                                 Consolidated
Interest Coverage Ratio.  The
Borrower shall not permit the Consolidated Interest Coverage Ratio as at the
last day of any Reference Period to be less than or equal to the ratio of 4.0
to 1.0.

 

SECTION 6.02.  Indebtedness.  The Borrower will not permit any Subsidiary
to create, incur, assume or permit to exist any Indebtedness, except:

 

(a)                                  Indebtedness
existing on the date hereof and set forth in Schedule 6.02, but not any
extensions, renewals or replacements of any such Indebtedness and without
increasing, or shortening the maturity of, the principal amount thereof;

 

(b)                                 Indebtedness
of any Subsidiary to the Borrower or any other Subsidiary;

 

(c)                                  Indebtedness
of any Subsidiary incurred to finance the acquisition, construction or
improvement of any fixed or capital assets, including Capital Lease Obligations
and any Indebtedness assumed in connection with the acquisition of any such
assets or secured by a Lien on any such assets prior to the acquisition
thereof, and extensions, renewals and replacements of any such Indebtedness
that do not increase the outstanding principal amount thereof; provided
that (i) such Indebtedness is incurred prior to or within 90 days after
such acquisition or the completion of such construction or improvement, and (ii) the
aggregate principal amount of Indebtedness permitted by this clause (d) shall
not exceed $10,000,000 at any time outstanding;

 

(d)                                 Indebtedness
of any Person that becomes a Subsidiary after the date hereof; provided
that such Indebtedness exists at the time such Person becomes a Subsidiary and
is not created in contemplation of or in connection with such Person becoming a
Subsidiary;

 

(e)                                  Indebtedness
of any Subsidiary as an account party in respect of trade letters of credit;
and

 

(f)                                    Other
unsecured Indebtedness (including unsecured Guarantees of Indebtedness of the
Borrower) in an aggregate principal amount not exceeding $25,000,000 at any
time outstanding.

 

45

 

SECTION 6.03.  Liens. 
The Borrower will not, and will not permit any Subsidiary to, create,
incur, assume or permit to exist any Lien on any property or asset now owned or
hereafter acquired by it, or assign or sell any income or revenues (including
accounts receivable) or rights in respect of any thereof, except:

 

(a)                                  Permitted
Encumbrances;

 

(b)                                 any
Lien on any property or asset of the Borrower or any Subsidiary existing on the
date hereof and set forth in Schedule 6.03; provided that (i) such
Lien shall not apply to any other property or asset of the Borrower or any
Subsidiary, and (ii) such Lien shall secure only those obligations which
it secures on the date hereof;

 

(c)                                  any
Lien existing on any property or asset prior to the acquisition thereof by the
Borrower or any Subsidiary or existing on any property or asset of any Person
that becomes a Subsidiary after the date hereof prior to the time such Person
becomes a Subsidiary; provided that (i) such Lien is not created in
contemplation of or in connection with such acquisition or such Person becoming
a Subsidiary, as the case may be, (ii) such Lien shall not apply to any
other property or assets of the Borrower or any Subsidiary, and (iii) such
Lien shall secure only those obligations which it secures on the date of such
acquisition or the date such Person becomes a Subsidiary, as the case may be;
and

 

(d)                                 Liens
on property, plant and equipment acquired, constructed or improved by the
Borrower or any Subsidiary; provided that (i) such security
interests secure Indebtedness permitted by clause (d) of Section 6.02,
(ii) such security interests and the Indebtedness secured thereby are
incurred prior to or within 90 days after such acquisition or the completion of
such construction or improvement, (iii) the Indebtedness secured thereby
does not exceed 70% of the cost of acquiring, constructing or improving such
property, plant and equipment, and (iv) such security interests shall not
apply to any other property or assets of the Borrower or any Subsidiary.

 

SECTION 6.04.  Fundamental Changes.  (a) The Borrower will not, and will not
permit any Subsidiary to, merge into or consolidate with any other Person, or
permit any other Person to merge into or consolidate with it, or sell,
transfer, lease or otherwise dispose of (in one transaction or in a series of
transactions) all or substantially all of its assets, or all or substantially
all of the stock of any of its Subsidiaries (in each case, whether now owned or
hereafter acquired), or liquidate or dissolve, except that, if at the time
thereof and immediately after giving effect thereto no Default shall have
occurred and be continuing (i) any other Person, including a Subsidiary,
may merge into the Borrower in a transaction in which the Borrower is the
surviving corporation, (ii) any Subsidiary may merge into any Subsidiary
in a transaction in which the surviving entity is a Subsidiary, (iii) any
Subsidiary may sell, transfer, lease or otherwise dispose of its assets to the
Borrower or to another Subsidiary, (iv) any Subsidiary may liquidate or
dissolve if the Borrower determines in good faith that such liquidation or
dissolution is in the best interests of the Borrower and is not materially
disadvantageous to the Lenders, and (v) so long as no Event of Default has
occurred or is continuing or would result therefrom, the Borrower may merge
into or consolidate with another Person in a transaction in which such other
Person is the surviving entity if such other Person (x) is organized and
validly existing under the laws of the United States or any State thereof, (y) such
Person shall assume all obligations of the 

 

46

 

Borrower hereunder,
pursuant to an assumption agreement in form and substance reasonably
satisfactory to the Administrative Agent, and (z) the Administrative Agent
shall have received a favorable opinion of counsel to such other Person
covering such matters relating to such assumption as the Administrative Agent
may reasonably request, and which opinion shall otherwise be in form and
substance satisfactory to the Administrative Agent; provided that any
such merger involving a Person that is not a wholly owned Subsidiary
immediately prior to such merger shall not be permitted unless also permitted
by Section 6.05.

 

(b)                                 The
Borrower will not, and will not permit any of its Subsidiaries to, engage to
any material extent in any business other than businesses of the type conducted
by the Borrower and its Subsidiaries on the date of execution of this Agreement
and businesses reasonably related thereto.

 

SECTION 6.05.  Investments, Loans, Advances, Guarantees
and Acquisitions; Hedging Agreements. 
(a) The Borrower will not, and will not permit any of its Subsidiaries
to, purchase, hold or acquire (including pursuant to any merger with any Person
that was not a wholly owned Subsidiary prior to such merger) any capital stock,
evidences of indebtedness or other securities (including any option, warrant or
other right to acquire any of the foregoing) of, make or permit to exist any
loans or advances to, Guarantee any obligations of, or make or permit to exist
any investment or any other interest in, any other Person, or purchase or
otherwise acquire (in one transaction or a series of transactions) any assets
of any other Person constituting a business unit, except:

 

(i)                                     Permitted
Investments;

 

(ii)                                  investments
by the Borrower in the capital stock of its Subsidiaries (whether now existing
or formed following the Closing Date);

 

(iii)                               loans or advances made
by the Borrower to any Subsidiary and made by any Subsidiary to the Borrower or
any other Subsidiary;

 

(iv)                              Guarantees
constituting Indebtedness permitted by Section 6.02;

 

(v)                                 Permitted
Acquisitions; and

 

(vi)                              other
investments, loans, advances, guarantees or acquisitions in an aggregate
principal amount not exceeding $40,000,000 at any time outstanding.

 

(b)                                 The
Borrower will not, and will not permit any of its Subsidiaries to, enter into
any Hedging Agreement, other than Hedging Agreements entered into in the
ordinary course of business to hedge or mitigate risks to which the Borrower or
any Subsidiary is exposed in the conduct of its business or the management of
its liabilities and not for purposes of speculation or taking a “market view”.

 

SECTION 6.06.  Restricted Payments.  The Borrower will not, and will not permit
any of its Subsidiaries to, declare or make, or agree to pay or make, directly
or indirectly, any Restricted Payment, except (a) the Borrower or any of
its Subsidiaries may declare and pay 

 

47

 

dividends (whether in
cash, securities or other property) with respect to its capital stock, provided
that, in the case of any such declaration or payment by the Borrower, no
Default or Event of Default has occurred or is continuing or would result
therefrom, (b) the Borrower may make Restricted Payments pursuant to and
in accordance with stock option plans or other benefit plans for management or
employees of the Borrower and its Subsidiaries, and (c) the Borrower may,
in addition to the foregoing, repurchase shares of the Borrower’s Class A
Common Stock and options therefor granted by the Borrower pursuant to its
employee stock option plans.

 

SECTION 6.07.  Transactions with Affiliates.  The Borrower will not, and will not permit
any of its Subsidiaries to, sell, lease or otherwise transfer any property or
assets to, or purchase, lease or otherwise acquire any property or assets from,
or otherwise engage in any other transactions with, any of its Affiliates,
except (a) in the ordinary course of business at prices and on terms and
conditions not less favorable to the Borrower or such Subsidiary than could be
obtained on an arm’s-length basis from unrelated third parties, (b) transactions
between or among the Borrower and its wholly owned Subsidiaries not involving
any other Affiliate, and (c) any Restricted Payment permitted by Section 6.06.

 

SECTION 6.08.  Restrictive Agreements.  The Borrower will not, and will not permit
any of its Subsidiaries to, directly or indirectly, enter into, incur or permit
to exist any agreement or other arrangement that prohibits, restricts or
imposes any condition upon (a) the ability of the Borrower or any
Subsidiary to create, incur or permit to exist any Lien upon any of its
property or assets, or (b) the ability of any Subsidiary to pay dividends
or other distributions with respect to any shares of its capital stock or to
make or repay loans or advances to the Borrower or any other Subsidiary or to
Guarantee Indebtedness of the Borrower or any other Subsidiary; provided
that (i) the foregoing shall not apply to restrictions and conditions
imposed by law or by this Agreement, (ii) the foregoing shall not apply to
restrictions and conditions existing on the date hereof identified on Schedule
6.08 (but shall apply to any extension or renewal of, or any amendment or
modification expanding the scope of, any such restriction or condition), (iii) the
foregoing shall not apply to customary restrictions and conditions contained in
agreements relating to the sale of a Subsidiary pending such sale, provided
such restrictions and conditions apply only to the Subsidiary that is to be
sold and such sale is permitted hereunder, (iv) clause (a) of
the foregoing shall not apply to restrictions or conditions imposed by any
agreement relating to secured Indebtedness permitted by this Agreement if such
restrictions or conditions apply only to the property or assets securing such
Indebtedness, and (v) clause (a) of the foregoing shall not
apply to customary provisions in leases restricting the assignment thereof.

 

SECTION 6.09.  Capital Expenditures.  The Borrower will not, and will not permit
any of its Subsidiaries to, make or commit to make any Capital Expenditure,
except Capital Expenditures of the Borrower and its Subsidiaries in the
ordinary course of business not exceeding $40,000,000 in the aggregate during
the term of this Agreement.

 

SECTION 6.10.  Sales and Leasebacks.  The Borrower will not, and will not permit
any of its Subsidiaries to, enter into any arrangement with any Person
providing for the leasing by the Borrower or any Subsidiary of real or personal
property that has been or is to be sold or transferred by the Borrower or such
Subsidiary to such Person or to any other Person to 

 

48

 

whom funds have been or
are to be advanced by such Person on the security of such property or rental
obligations of the Borrower or such Subsidiary (a “Sale/Leaseback
Transaction”), except Sale/Leaseback Transactions entered into with respect
to the real property listed on Schedule 6.10.

 

SECTION 6.11.  Changes in Fiscal Periods.  The Borrower will not permit the fiscal year
of the Borrower to end on a day other than December 31 or change the
Borrower’s method of determining fiscal quarters.

 

SECTION 6.12.  Optional Payments and Modifications of
Certain Debt Instruments.  The
Borrower will not permit any of its Subsidiaries to make or offer to make any
optional or voluntary payment, prepayment, repurchase or redemption of or
otherwise optionally or voluntarily defease any Indebtedness, or amend, modify,
waive or otherwise change, or consent or agree to any amendment, modification,
waiver or other change to, any of the terms relating to the payment or
prepayment of principal of or interest on, any such Indebtedness (other than any
such amendment, modification, waiver or other change that would extend the
maturity or reduce the amount of any payment of principal thereof or reduce the
rate or extend any date for payment of interest thereon).

 

SECTION 6.13.  Use of Proceeds.  The Borrower will not use the proceeds of any
Loan, whether directly or indirectly, and whether immediately, incidentally or
ultimately, to purchase or carry margin stock (within the meaning of Regulation
U of the Regulations of the Board) or to extend credit to others for the
purpose of purchasing or carrying margin stock or to refund indebtedness
originally incurred for such purpose, in each case so as to result in a
violation of Regulation U.

 

ARTICLE VII

 

Events of Default

 

If any of the following events (“Events of
Default”) shall occur:

 

(a)                                  the
Borrower shall fail to pay any principal of any Loan when and as the same shall
become due and payable, whether at the due date thereof or at a date fixed for
prepayment thereof or otherwise;

 

(b)                                 the
Borrower shall fail to pay any interest on any Loan or any fee or any other
amount (other than an amount referred to in clause (a) of this
Article) payable under any Loan Document, when and as the same shall become due
and payable, and such failure shall continue unremedied for a period of five (5) days;

 

(c)                                  any
representation or warranty made or deemed made by or on behalf of the Borrower
or any Subsidiary in or in connection with this Agreement or any amendment or
modification hereof, or in any report, certificate, financial statement or
other document furnished pursuant to or in connection with this Agreement or
any amendment or modification hereof, shall prove to have been materially
incorrect when made or deemed made;

 

49

 

(d)                                 the
Borrower shall fail to observe or perform any covenant, condition or agreement
contained in Sections 501, 5.02, 5.03 (with respect to the
Borrower’s existence), 5.06 (with respect to the inspection rights of
the Administrative Agent and the Lenders) or 5.08 or in Article VI;

 

(e)                                  the
Borrower shall fail to observe or perform any covenant, condition or agreement
contained in any Loan Document (other than those specified in clauses (a),
(b) or (d) of this Article), and such failure shall
continue unremedied for a period of 30 days after notice thereof from the
Administrative Agent (given at the request of any Lender) to the Borrower;

 

(f)                                    the
Borrower or any Subsidiary shall fail to make any payment (whether of principal
or interest and regardless of amount) in respect of any Material Indebtedness,
when and as the same shall become due and payable;

 

(g)                                 any
event or condition occurs that results in any Material Indebtedness becoming
due prior to its scheduled maturity or that enables or permits (with or without
the giving of notice, the lapse of time or both) the holder or holders of any
Material Indebtedness or any trustee or agent on its or their behalf to cause
any Material Indebtedness to become due, or to require the prepayment,
repurchase, redemption or defeasance thereof, prior to its scheduled maturity; provided
that this clause (g) shall not apply to secured Indebtedness that
becomes due as a result of the voluntary sale or transfer of the property or
assets securing such Indebtedness;

 

(h)                                 an
involuntary proceeding shall be commenced or an involuntary petition shall be
filed seeking (i) liquidation, reorganization or other relief in respect
of the Borrower or any Subsidiary or its debts, or of a substantial part of its
assets, under any Federal, state or foreign bankruptcy, insolvency,
receivership or similar law now or hereafter in effect, or (ii) the
appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for the Borrower or any Subsidiary or for a substantial part
of its assets, and, in any such case, such proceeding or petition shall
continue undismissed for 60 days or an order or decree approving or ordering
any of the foregoing shall be entered;

 

(i)                                     the
Borrower or any Subsidiary shall (i) voluntarily commence any proceeding
or file any petition seeking liquidation, reorganization or other relief under
any Federal, state or foreign bankruptcy, insolvency, receivership or similar
law now or hereafter in effect, (ii) consent to the institution of, or fail
to contest in a timely and appropriate manner, any proceeding or petition
described in clause (h) of this Article, (iii) apply for or
consent to the appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for the Borrower or any Subsidiary or for a
substantial part of its assets, (iv) file an answer admitting the material
allegations of a petition filed against it in any such proceeding, (v) make
a general assignment for the benefit of creditors, or (vi) take any action
for the purpose of effecting any of the foregoing;

 

(j)                                     the
Borrower or any Subsidiary shall become unable, admit in writing or fail
generally to pay its debts as they become due;

 

(k)                                  one
or more judgments for the payment of money in an aggregate amount in excess of
$10,000,000 shall be rendered against the Borrower, any Subsidiary or any 

 

50

 

combination thereof and
the same shall remain undischarged for a period of 30 consecutive days during
which execution shall not be effectively stayed, or any action shall be legally
taken by a judgment creditor to attach or levy upon any assets of the Borrower
or any Subsidiary to enforce any such judgment;

 

(l)                                     an
ERISA Event shall have occurred that, in the opinion of the Required Lenders,
when taken together with all other ERISA Events that have occurred, could
reasonably be expected to result in a Material Adverse Effect;

 

(m)                               any
material provision of this Agreement or any other Loan Document, at any time
after its execution and delivery and for any reason other than as expressly
permitted hereunder or thereunder or satisfaction in full of all the
obligations of the Borrower hereunder or thereunder, ceases to be in full force
and effect; or the Borrower or any other Person contests in any manner the
validity or enforceability of any provision of any Loan Document; or the
Borrower denies that it has any or further liability or obligation under any
provision of any Loan Document, or purports to revoke, terminate or rescind any
provision of any Loan Document; or

 

(n)                                 a
Change in Control shall occur;

 

then, and in every such event (other than an event with respect to the
Borrower described in clause (h) or (i) of this
Article), and at any time thereafter during the continuance of such event, the
Administrative Agent may, and at the request of the Required Lenders shall, by
notice to the Borrower, take either or both of the following actions, at the
same or different times:  (i) terminate
the Commitments, and thereupon the Commitments shall terminate immediately,
and/or (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 Borrower 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
the Borrower; and in case of any event with respect to the Borrower described
in clause (h) or (i) of this Article, the Commitments
shall automatically terminate and the principal of the Loans then outstanding,
together with accrued interest thereon and all fees and other obligations of
the Borrower accrued hereunder, shall automatically become due and payable,
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by the Borrower.

 

After the exercise of
remedies provided for in this Article VII (or after the Loans have
automatically become immediately due and payable after the occurrence of any
event with respect to the Borrower described in clause (h) or (i) of
this Article), any amounts received on account of all Loans, fees and other
obligations of the Borrower accrued hereunder, shall be applied by the
Administrative Agent in the following order:

 

(i)                                     First,
to payment of that portion of the obligations constituting fees, indemnities,
expenses and other amounts (including fees, charges and disbursements of
counsel to the Administrative Agent and amounts payable under Sections 2.11,
2.12 and 2.13) payable to the Administrative Agent in its
capacity as such;

 

51

 

(ii)                                  Second,
to payment of that portion of the obligations constituting fees, indemnities
and other amounts (other than principal and interest) payable to the Lenders
(including fees, charges and disbursements of counsel to the respective Lenders
and amounts payable under Sections 2.11, 2.12 and 2.13),
ratably among them in proportion to the respective amounts described in this
clause Second payable to them;

 

(iii)                               Third, to payment
of that portion of the obligations constituting accrued and unpaid interest on
the Loans, ratably among the Lenders in proportion to the respective amounts
described in this clause Third held by them;

 

(iv)                              Fourth,
to payment of that portion of the obligations constituting unpaid principal of
the Loans, ratably among the Lenders in proportion to the respective amounts
described in this clause Fourth held by them;

 

(v)                                 Last,
the balance, if any, after all of the other obligations and amounts due and
payable hereunder have been indefeasibly paid in full, to the Borrower or as
otherwise required by law.

 

ARTICLE VIII

 

The Administrative Agent

 

SECTION 8.01.  Appointment and Authority.  Each of the Lenders hereby irrevocably
appoints Bank of America to act on its behalf as the Administrative Agent
hereunder and under the other Loan Documents and authorizes the Administrative
Agent to take such actions on its behalf and to exercise such powers as are
delegated to the Administrative Agent by the terms hereof or thereof, together with
such actions and powers as are reasonably incidental thereto.  The provisions of this Article are
solely for the benefit of the Administrative Agent and the Lenders, and the Borrower shall not  have rights as a third party
beneficiary of any of such provisions.

 

SECTION 8.02.  Rights as a Lender.  The Person serving as the Administrative
Agent hereunder shall have the same rights and powers in its capacity as a
Lender as any other Lender and may exercise the same as though it were not the
Administrative Agent and the term “Lender” or “Lenders” shall, unless otherwise
expressly indicated or unless the context otherwise requires, include the
Person serving as the Administrative Agent hereunder in its individual
capacity.  Such Person and its Affiliates
may accept deposits from, lend money to, act as the financial advisor or in any
other advisory capacity for and generally engage in any kind of business with
the Borrower or any Subsidiary or other Affiliate thereof as if such Person
were not the Administrative Agent hereunder and without any duty to account
therefor to the Lenders.

 

SECTION 8.03.  Exculpatory Provisions.  The Administrative Agent shall not have any
duties or obligations except those expressly set forth herein and in the other
Loan Documents.  Without limiting the
generality of the foregoing, the Administrative Agent:

 

(a)                                  shall
not be subject to any fiduciary or other implied duties, regardless of whether
a Default has occurred and is continuing;

 

52

 

(b)                                 shall not have any
duty to take any discretionary action or exercise any discretionary powers,
except discretionary rights and powers expressly contemplated hereby or by the
other Loan Documents that the Administrative Agent is required to exercise as
directed in writing by the Required Lenders (or such other number or percentage
of the Lenders as shall be expressly provided for herein or in the other Loan
Documents), provided that the Administrative Agent shall not be required
to take any action that, in its opinion or the opinion of its counsel, may
expose the Administrative Agent to liability or that is contrary to any Loan
Document or Requirement of Law; and

 

(c)                                  shall
not, except as expressly set forth herein and in the other Loan Documents, have
any duty to disclose, and shall not be liable for the failure to disclose, any
information relating to the Borrower or any of its Affiliates that is
communicated to or obtained by the Person serving as the Administrative Agent
or any of its Affiliates in any capacity.

 

The Administrative Agent shall not be liable for any action taken or
not taken by it (i) with the consent or at the request of the Required
Lenders (or such other number or percentage of the Lenders as shall be
necessary, or as the Administrative Agent shall believe in good faith shall be
necessary, under the circumstances as provided in Sections 9.02 and Article VII)
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 describing such Default is given to the Administrative Agent by the
Borrower or a Lender.

 

The Administrative Agent shall not be responsible for or have any duty
to ascertain or inquire into (i) any statement, warranty or representation
made in or in connection with this Agreement or any other Loan Document, (ii) the
contents of any certificate, report or other document delivered hereunder or
thereunder or in connection herewith or therewith, (iii) the performance
or observance of any of the covenants, agreements or other terms or conditions
set forth herein or therein or the occurrence of any Default, (iv) the
validity, enforceability, effectiveness or genuineness of this Agreement, any
other Loan Document or any other agreement, instrument or document or (v) the
satisfaction of any condition set forth in Article IV or elsewhere
herein, other than to confirm receipt of items expressly required to be
delivered to the Administrative Agent.

 

SECTION 8.04.  Reliance by Administrative Agent.  The Administrative Agent shall be entitled to
rely upon, and shall not incur any liability for relying upon, any notice,
request, certificate, consent, statement, instrument, document or other writing
(including any electronic message, Internet or intranet website posting or
other distribution) believed by it to be genuine and to have been signed, sent
or otherwise authenticated by the proper Person.  The Administrative Agent also may rely upon
any statement made to it orally or by telephone and believed by it to have been
made by the proper Person, and shall not incur any liability for relying
thereon.  In determining compliance with
any condition hereunder to the making of a Loan that by its terms must be
fulfilled to the satisfaction of a Lender, the Administrative Agent may presume
that such condition is satisfactory to such Lender unless the Administrative
Agent shall have received notice to the contrary from such Lender prior to the
making of such Loan.  The Administrative
Agent may consult with legal counsel (who may be counsel for the Borrower),
independent accountants and other experts selected by it, and shall not be
liable for 

 

53

 

any action taken or not
taken by it in accordance with the advice of any such counsel, accountants or
experts.

 

SECTION 8.05.  Delegation of Duties.  The Administrative Agent may perform any and
all of its duties and exercise its rights and powers hereunder or under any
other Loan Document by or through any one or more sub-agents appointed by the
Administrative Agent.  The Administrative
Agent and any such sub-agent may perform any and all of its duties and exercise
its rights and powers by or through their respective Related Parties.  The exculpatory provisions of this Article shall
apply to any such sub-agent and to the Related Parties of the Administrative
Agent and any such sub-agent, and shall apply to their respective activities in
connection with the syndication of the credit facilities provided for herein as
well as activities as Administrative Agent.

 

SECTION 8.06.  Resignation of Administrative Agent.  The Administrative Agent may at any time give
notice of its resignation to the Lenders and the Borrower.  Upon receipt of any such notice of
resignation, the Required Lenders shall have the right, in consultation with
the Borrower, to appoint a successor, which shall be a bank with an office in
the United States, or an Affiliate of any such bank with an office in the
United States.  If no such successor
shall have been so appointed by the Required Lenders and shall have accepted
such appointment within 30 days after the retiring Administrative Agent
gives notice of its resignation, then the retiring Administrative Agent may on
behalf of the Lenders, appoint a successor Administrative Agent meeting the
qualifications set forth above; provided that if the Administrative
Agent shall notify the Borrower and the Lenders that no qualifying Person has
accepted such appointment, then such resignation shall nonetheless become
effective in accordance with such notice and (1) the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder and under the other Loan Documents and (2) all payments,
communications and determinations provided to be made by, to or through the
Administrative Agent shall instead be made by or to each Lender directly, until
such time as the Required Lenders appoint a successor Administrative Agent as
provided for above in this Section.  Upon
the acceptance of a successor’s appointment as Administrative Agent hereunder,
such successor shall succeed to and become vested with all of the rights,
powers, privileges and duties of the retiring (or retired) Administrative
Agent, and the retiring Administrative Agent shall be discharged from all of
its duties and obligations hereunder or under the other Loan Documents (if not
already discharged therefrom as provided above in this Section).  The fees payable by the Borrower to a
successor Administrative Agent shall be the same as those payable to its
predecessor unless otherwise agreed between the Borrower and such
successor.  After the retiring
Administrative Agent’s resignation hereunder and under the other Loan
Documents, the provisions of this Article and Section 9.03
shall continue in effect for the benefit of such retiring Administrative Agent,
its sub-agents and their respective Related Parties in respect of any actions
taken or omitted to be taken by any of them while the retiring Administrative Agent
was acting as Administrative Agent.

 

SECTION 8.07.  Non-Reliance on Administrative Agent and
Other Lenders.  Each Lender
acknowledges that it has, independently and without reliance upon the
Administrative Agent or any other Lender or any of their Related Parties and
based on such documents and information as it has deemed appropriate, made its
own credit analysis and 

 

54

 

decision to enter into
this Agreement.  Each Lender also
acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Lender or any of their Related Parties and
based on such documents and information as it shall from time to time deem
appropriate, continue to make its own decisions in taking or not taking action
under or based upon this Agreement, any other Loan Document or any related
agreement or any document furnished hereunder or thereunder.

 

SECTION 8.08.  No Other Duties, Etc.  Anything herein to the contrary
notwithstanding, the Arranger shall have no powers, duties or responsibilities
under this Agreement.

 

ARTICLE IX

 

Miscellaneous

 

SECTION 9.01.  Notices; Effectiveness; Electronic
Communication.

 

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

 

(i)                                     if
to the Borrower or the Administrative Agent to the address, telecopier number,
electronic mail address or telephone number specified for such Person on Schedule
9.01; and

 

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

 

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

 

(b)                                 Notices
and other communications to the Lenders may be delivered or furnished by
electronic communication (including e-mail and Internet or intranet websites)
pursuant to procedures approved by the Administrative Agent, provided
that the foregoing shall not apply to notices to any Lender pursuant to Article II
if such Lender, as applicable, has notified the Administrative Agent that it is
incapable of receiving notices under such Article by electronic
communication.  The Administrative Agent
or the Borrower may, in its discretion, agree to accept notices and other
communications to it hereunder by electronic communications 

 

55

 

pursuant to procedures
approved by it, provided that approval of such procedures may be limited
to particular notices or communications.

 

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

 

(c)                                  THE
PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.”  THE AGENT PARTIES (AS DEFINED BELOW) DO NOT
WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER MATERIALS OR THE ADEQUACY
OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS
FROM THE BORROWER MATERIALS.  NO WARRANTY
OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY
RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT
PARTY IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM.  In no event shall the Administrative Agent or
any of its Related Parties (collectively, the “Agent Parties”) have any
liability to the Borrower, any Lender or any other Person for losses, claims,
damages, liabilities or expenses of any kind (whether in tort, contract or
otherwise) arising out of the Borrower’s or the Administrative Agent’s
transmission of Borrower Materials through the Internet, except to the extent
that such losses, claims, damages, liabilities or expenses are determined by a
court of competent jurisdiction by a final and nonappealable judgment to have
resulted from the gross negligence or willful misconduct of such Agent Party; provided,
however, that in no event shall any Agent Party have any liability to
the Borrower, any Lender or any other Person for indirect, special, incidental,
consequential or punitive damages (as opposed to direct or actual damages).

 

(d)                                 Each
of the Borrower and the Administrative Agent Lender may change its address,
telecopier or telephone number for notices and other communications hereunder
by notice to the other parties hereto. 
Each other Lender may change its address, telecopier or telephone number
for notices and other communications hereunder by notice to the Borrower, and
the Administrative Agent.  In addition,
each Lender agrees to notify the Administrative Agent from time to time to
ensure that the Administrative Agent has on record (i) an effective
address, contact name, telephone number, telecopier number and electronic mail
address to which notices and other communications may be sent and (ii) accurate
wire instructions for such Lender. 
Furthermore, each Public Lender agrees to cause at least one individual
at or on behalf of such Public Lender to at all times have selected the “Private
Side Information” or similar designation on the content declaration screen of
the Platform in order to enable such Public Lender or its delegate, in
accordance with such Public Lender’s compliance procedures and 

 

56

 

applicable law, including
United States Federal and state securities laws, to make reference to Borrower
Materials that are not made available through the “Public Side Information”
portion of the Platform and that may contain material non-public information
with respect to the Borrower or its securities for purposes of United States
Federal or state securities laws.

 

(e)                                  The
Administrative Agent and the Lenders shall be entitled to rely and act upon any
notices purportedly given by or on behalf of the Borrower even if (i) such
notices were not made in a manner specified herein, were incomplete or were not
preceded or followed by any other form of notice specified herein, or (ii) the
terms thereof, as understood by the recipient, varied from any confirmation
thereof.  The Borrower shall indemnify
the Administrative Agent, each Lender and the Related Parties of each of them
from all losses, costs, expenses and liabilities resulting from the reliance by
such Person on each notice purportedly given by or on behalf of the
Borrower.  All telephonic notices to and
other telephonic communications with the Administrative Agent may be recorded
by the Administrative Agent, and each of the parties hereto hereby consents to
such recording.

 

SECTION 9.02.  Waivers; Amendments; Enforcement.  (a) No failure or delay by the Administrative
Agent or any Lender in exercising any right or power hereunder shall operate as
a waiver thereof, nor shall any single or partial exercise of any such right or
power, or any abandonment or discontinuance of steps to enforce such a right or
power, preclude any other or further exercise thereof or the exercise of any
other right or power.  The rights and
remedies of the Administrative Agent and the Lenders hereunder are cumulative
and are not exclusive of any rights or remedies that they would otherwise have.  No waiver of any provision of this Agreement
or any other Loan Document or consent to any departure by the Borrower
therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) of this Section, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which
given.  Without limiting the generality
of the foregoing, the making of a Loan shall not be construed as a waiver of
any Default, regardless of whether the Administrative Agent or any Lender may
have had notice or knowledge of such Default at the time.

 

(b)                                 No
Loan Document or any provision thereof may be waived, amended or modified
except pursuant to an agreement or agreements in writing entered into by the
Borrower and the Required Lenders or by the Borrower and the Administrative
Agent with the consent of the Required Lenders; provided that no such
agreement shall (i) waive any condition set forth in Section 4.01(a) without
the written consent of each Lender, (ii) extend or increase the Commitment
of any Lender (or reinstate any Commitment terminated pursuant to Article VII)
without the written consent of such Lender, (iii) reduce the principal
amount of any Loan or reduce the rate of interest thereon, or reduce any fees
payable hereunder, without the written consent of each Lender affected thereby,
(iv) postpone the scheduled date of payment of the principal amount of any
Loan, or any interest thereon, fees or other amounts due to the Lenders (or any
of them), or reduce the amount of, waive or excuse any such payment, or postpone
the scheduled date of expiration of any Commitment, without the written consent
of each Lender affected thereby, (v) change Section 2.14(b) or
(c) in a manner that would alter the pro rata sharing of payments
required thereby, without the written consent of each Lender, or (vi) change
any of the provisions of this Section or the definition of “Required
Lenders” or any other provision hereof specifying the number or percentage of
Lenders required to waive, amend or 

 

57

 

modify any rights
hereunder or make any determination or grant any consent hereunder, without
the  written consent of each Lender; provided
further that (x) no such agreement shall amend, modify or otherwise
affect the rights or duties of the Administrative Agent hereunder without the
prior written consent of the Administrative Agent, and (y) the Fee Letter
may be amended, or rights or privileges thereunder waived, in a writing
executed only by the parties thereto. 
Notwithstanding anything to the contrary herein, no Defaulting Lender
shall have any right to approve or disapprove any amendment, waiver or consent
hereunder (and any amendment, waiver or consent which by its terms requires the
consent of all Lenders may be effected with the consent of all Lenders other
than Defaulting Lenders), except that (x) the Commitment of any Defaulting
Lender may not be increased or extended without the consent of such Lender and (y) any
waiver, amendment or the modification requiring the consent of all Lenders or
each affected Lender that by its terms affects any Defaulting Lender more
adversely than other affected Lenders shall require the consent of such
Defaulting Lender.

 

(c)                                  Notwithstanding
anything to the contrary contained herein or in any other Loan Document, the
authority to enforce rights and remedies hereunder and under the other Loan
Documents against the Borrower shall be vested exclusively in, and all actions
and proceedings at law in connection with such enforcement shall be instituted
and maintained exclusively by, the Administrative Agent in accordance with Article VII
for the benefit of all the Lenders; provided, however, that the
foregoing shall not prohibit (a) the Administrative Agent from exercising
on its own behalf the rights and remedies that inure to its benefit (solely in
its capacity as Administrative Agent) hereunder and under the other Loan
Documents, (b) any Lender from exercising setoff rights in accordance with
Section 9.08 (subject to the terms of Section 2.14), or
(c) any Lender from filing proofs of claim or appearing and filing
pleadings on its own behalf during the pendency of a proceeding relative to the
Borrower under any bankruptcy or insolvency proceeding; and provided, further,
that if at any time there is no Person acting as Administrative Agent hereunder
and under the other Loan Documents, then (i) the Required Lenders shall
have the rights otherwise ascribed to the Administrative Agent pursuant to Article VII
and (ii) in addition to the matters set forth in clauses (b) and
(c) of the preceding proviso and subject to Section 2.14,
any Lender may, with the consent of the Required Lenders, enforce any rights
and remedies available to it and as authorized by the Required Lenders.

 

SECTION 9.03.  Expenses; Indemnity; Damage Waiver.  (a) The Borrower shall pay (i) all
reasonable, documented out-of-pocket expenses incurred by the Administrative
Agent and its Affiliates (including the reasonable fees, charges and
disbursements of counsel for the Administrative Agent), in connection with the
syndication of the credit facilities provided for herein, the preparation,
negotiation, execution, delivery and administration of this Agreement and the
other Loan Documents or any amendments, modifications or waivers of the
provisions hereof or thereof (whether or not the transactions contemplated
hereby or thereby shall be consummated), and (ii) all out of pocket
expenses incurred by the Administrative Agent or any Lender (including the
fees, charges and disbursements of any counsel for the Administrative Agent or
any Lender), in connection with the enforcement or protection of its rights (A) in
connection with this Agreement and the other Loan Documents, including its
rights under this Section, or (B) in connection with the Loans made hereunder,
including all such out of pocket expenses incurred during any workout,
restructuring or negotiations in respect of such Loans.

 

58

 

(b)                                 The
Borrower shall indemnify the Administrative Agent (and any sub-agent thereof),
each Lender, and each Related Party of any of the foregoing Persons (each such
Person being called an “Indemnitee”) against, and hold each Indemnitee
harmless from, any and all losses, claims, damages, liabilities and related
expenses (including the fees, charges and disbursements of any counsel for any
Indemnitee), incurred by any Indemnitee or asserted against any Indemnitee by
any third party or by the Borrower arising out of, in connection with, or as a
result of (i) the execution or delivery of this Agreement or any other
Loan Document or any agreement or instrument contemplated hereby or thereby,
the performance by the parties hereto and thereto of their respective
obligations hereunder and thereunder, the consummation of the transactions
contemplated hereby and thereby, or, in the case of the Administrative Agent
(and any sub-agent thereof) and its Related Parties only, the administration of
this Agreement and the other Loan Documents, (ii) any Loan or the use or
proposed use of the proceeds therefrom, (iii) any actual or alleged
presence or release of Hazardous Materials on or from any property owned or
operated by the Borrower or any of its Subsidiaries, or any Environmental
Liability related in any way to the Borrower or any of its Subsidiaries, or (iv) any
actual or prospective claim, litigation, investigation or proceeding relating
to any of the foregoing, whether based on contract, tort or any other theory,
whether brought by a third party or by the Borrower, and regardless of whether
any Indemnitee is a party thereto; provided that such indemnity shall
not, as to any Indemnitee, be available to the extent that such losses, claims,
damages, liabilities or related expenses (x) are determined by a court of
competent jurisdiction by final and nonappealable judgment to have resulted
from the gross negligence or willful misconduct of such Indemnitee or (y) result
from a claim brought by the Borrower against an Indemnitee for breach in bad
faith of such Indemnitee’s obligations hereunder, if the Borrower has obtained
a final and nonappealable judgment in its favor on such claim as determined by
a court of competent jurisdiction.

 

(c)                                  To
the extent that the Borrower for any reason fails to indefeasibly pay any
amount required under subsection (a) or (b) of
this Section to be paid by it to the Administrative Agent (or any
sub-agent thereof), or any Related Party of the Administrative Agent, each
Lender severally agrees to pay to the Administrative Agent (or any such
sub-agent), or such Related Party, as the case may be, such Lender’s Applicable
Percentage (determined as of the time that the applicable unreimbursed expense
or indemnity payment is sought) of such unpaid amount, provided that the
unreimbursed expense or indemnified loss, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted against the
Administrative Agent (or any such sub-agent) in its capacity as such, or
against any such Related Party acting for the Administrative Agent (or any such
sub-agent) in connection with such capacity. 
The obligations of the Lenders under this subsection (c) are
subject to the provisions of Section 2.14(e).

 

(d)                                 To
the fullest extent permitted by applicable law, the Borrower shall not assert,
and hereby waives, any claim against any Indemnitee, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct or actual damages) arising out of, in connection with, or as a result
of, this Agreement, any other Loan Document or any agreement or instrument
contemplated hereby, the transactions contemplated hereby or thereby, any Loan
or the use of the proceeds thereof.  No
Indemnitee referred to in subsection (b) above shall be liable for
any damages arising from the use by unintended recipients of any 

 

59

 

information or other
materials distributed to such unintended recipients by such Indemnitee through
telecommunications, electronic or other information transmission systems in connection
with this Agreement or the other Loan Documents or the transactions
contemplated hereby or thereby other than for direct or actual damages
resulting from the gross negligence or willful misconduct of such Indemnitee as
determined by a final and nonappealable judgment of a court of competent
jurisdiction.

 

(e)                                  All
amounts due under this Section shall be payable not later than five (5) days
after written demand therefor.

 

(f)                                    The
agreements in this Section shall survive the resignation of the Administrative
Agent, the replacement of any
Lender, the termination of the Commitments and the repayment, satisfaction or
discharge of all the other obligations hereunder.

 

SECTION 9.04.  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 permitted hereby, except that the Borrower
may not assign or otherwise transfer any of its rights or obligations hereunder
without the prior written consent of the Administrative Agent and each Lender
and no Lender may assign or otherwise transfer any of its rights or obligations
hereunder except (i) to an assignee in accordance with the provisions of subsection
(b) of this Section, (ii) by way of participation in accordance
with the provisions of subsection (d) of this Section, or (iii) by
way of pledge or assignment of a security interest subject to the restrictions
of subsection (f) of this Section (and any other attempted
assignment or transfer by any party hereto shall be null and void).  Nothing in this Agreement, expressed or
implied, shall be construed to confer upon any Person (other than the parties
hereto, their respective successors and assigns permitted hereby, Participants
to the extent provided in subsection (d) of this Section and,
to the extent expressly contemplated hereby, the Related Parties of each of the
Administrative Agent and the Lenders) any legal or equitable right, remedy or
claim under or by reason of this Agreement.

 

(b)                                 Any
Lender may assign to one or more assignees all or a portion of its rights and
obligations under this Agreement (including all or a portion of its Commitment
and the Loans at the time owing to it); provided that any such
assignment shall be subject to the following conditions:

 

(i)                                     Minimum
Amounts.

 

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

 

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

 

60

 

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

 

(ii)                                  Proportionate
Amounts.  Each partial assignment
shall be made as an assignment of a proportionate part of all the assigning
Lender’s rights and obligations under this Agreement with respect to the Loans
or the Commitment assigned.

 

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

 

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

 

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

 

(iv)                              Assignment
and Assumption.  The parties to each
assignment shall execute and deliver to the Administrative Agent an Assignment
and Assumption, together with a processing and recordation fee in the amount of
$3,500; provided, however, that the Administrative Agent may, in
its sole discretion, elect to waive such processing and recordation fee in the
case of any assignment.  The assignee, if
it is not a Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire.

 

(v)                                 No
Assignment to Borrower or Defaulting Lenders.  No such assignment shall be made to (A) the
Borrower or any of the Borrower’s Affiliates or Subsidiaries or (B) any
Defaulting Lender or any of its subsidiaries, or any Person who, upon becoming
a Lender hereunder, would constitute any of the foregoing Persons described in
this clause (B).

 

61

 

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

 

(vii)                           Certain Additional
Payments. In connection with any assignment of rights and obligations of
any Defaulting Lender hereunder, no such assignment shall be effective unless
and until, in addition to the other conditions thereto set forth herein, the
parties to the assignment shall make such additional payments to the
Administrative Agent in an aggregate amount sufficient, upon distribution
thereof as appropriate (which may be outright payment, purchases by the
assignee of participations or subparticipations, or other compensating actions,
including funding, with the consent of the Borrower and the Administrative
Agent, the applicable pro rata share of Loans previously requested but not
funded by the Defaulting Lender, to each of which the applicable assignee and
assignor hereby irrevocably consent), to (x) pay and satisfy in full all
payment liabilities then owed by such Defaulting Lender to the Administrative
Agent or any Lender hereunder (and interest accrued thereon) and (y) acquire
(and fund as appropriate) its full pro rata share of all Loans in accordance
with its Applicable Percentage.

 

Subject to acceptance and recording thereof by the Administrative Agent
pursuant to subsection (c) of this Section, from and after the
effective date specified in each Assignment and Assumption, the assignee
thereunder shall be a party to this Agreement and, to the extent of the
interest assigned by such Assignment and Assumption, have the rights and
obligations of a Lender under this Agreement, and the assigning Lender
thereunder shall, to the extent of the interest assigned by such Assignment and
Assumption, be released from its obligations under this Agreement (and, in the
case of an Assignment and Assumption covering all of the assigning Lender’s
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto) but shall continue to be entitled to the benefits of Sections
2.11, 2.12, 2.13 and 9.03 with respect to facts and
circumstances occurring prior to the effective date of such assignment.  Upon request, the Borrower (at its expense)
shall execute and deliver a Note to the assignee Lender.  Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this
subsection shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with subsection
(d) of this Section.

 

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

 

62

 

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

 

Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce this Agreement and to
approve any amendment, modification or waiver of any  provision of this Agreement; provided
that such agreement or instrument may provide that such Lender will not,
without the consent of the Participant, agree to any amendment, waiver or other
modification described in the first proviso to Section 9.02(b) that
affects such Participant.  Subject to subsection
(e) of this Section, the Borrower agrees that each Participant shall
be entitled to the benefits of Sections 2.11, 2.12 and 2.13  to the same extent as if it were a Lender and had acquired
its interest by assignment pursuant to subsection (b) of this
Section.  To the extent permitted by law,
each Participant also shall be entitled to the benefits of Section 9.08  as though it were a Lender, provided such Participant
agrees to be subject to Section 2.14 as though it were a Lender.

 

(e)           A Participant shall not be entitled
to receive any greater payment under Section 2.11 or 2.13
than the applicable Lender would have been entitled to receive with respect to
the participation sold to such Participant, unless the sale of the
participation to such Participant is made with the Borrower’s prior written
consent.  A Participant that would be a
Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 2.13
unless the Borrower is notified of the participation sold to such Participant
and such Participant agrees, for the benefit of the Borrower, to comply with Section 2.13(e) as
though it were a Lender.

 

(f)            Any Lender may at any time pledge or
assign a security interest in all or any portion of its rights under this
Agreement (including under its Note, if any) to secure obligations of such
Lender, including any pledge or assignment to secure obligations to a Federal
Reserve Bank; provided that no such pledge or assignment shall release
such Lender from any of its obligations hereunder or substitute any such
pledgee or assignee for such Lender as a party hereto.

 

SECTION 9.05.  Survival.  All representations and warranties made
hereunder and in any other Loan Document or other document delivered pursuant
hereto or thereto or in connection herewith or therewith shall survive the
execution and delivery hereof and thereof. 
Such representations and warranties have been or will be relied upon by
the Administrative Agent and each Lender, regardless of any investigation made
by the Administrative Agent or any Lender or on their behalf and
notwithstanding that the Administrative Agent or any Lender may have had notice
or knowledge of any Default at the time of any Credit Extension, and shall
continue in full force and effect as long as any Loan or any fee or any other
amount payable 

 

63

 

hereunder shall remain
unpaid or unsatisfied.  The provisions of
Sections 2.11, 2.12, 2.13 and 9.03 and Article VIII
shall survive and remain in full force and effect regardless of the
consummation of the transactions contemplated hereby, the repayment of the
Loans, the expiration or termination of the Commitments or the termination of
this Agreement or any provision hereof.

 

SECTION 9.06.  Counterparts; Integration; Effectiveness.  This Agreement may be executed in
counterparts (and by different parties hereto on different counterparts), each
of which shall constitute an original, but all of which when taken together
shall constitute a single contract.  This
Agreement and the other Loan Documents constitute the entire contract among the
parties relating to the subject matter hereof and supersede any and all
previous agreements and understandings, oral or written, relating to the
subject matter hereof.  Except as
provided in Section 4.01, this Agreement shall become effective
when it shall have been executed by the Administrative Agent and when the
Administrative Agent shall have received counterparts hereof which, when taken
together, bear the signatures of each of the other parties hereto, and
thereafter shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns. 
Delivery of an executed counterpart of a signature page of this
Agreement by telecopy or other electronic imaging means shall be effective as
delivery of a manually executed counterpart of this Agreement.

 

SECTION 9.07.  Severability.  Any provision of this Agreement or any other
Loan Document held to be invalid, illegal or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such
invalidity, illegality or unenforceability without affecting the validity,
legality and enforceability of the remaining provisions hereof or thereof; and
the invalidity of a particular provision in a particular jurisdiction shall not
invalidate such provision in any other jurisdiction.

 

SECTION 9.08.  Right of Setoff.  If an Event of Default shall have occurred
and be continuing, each Lender is hereby authorized at any time and from time
to time, to the fullest extent permitted by law, to set off and apply any and
all deposits (general or special, time or demand, provisional or final) at any
time held and other indebtedness at any time owing by such Lender to or for the
credit or the account of the Borrower against any of and all of the obligations
of the Borrower now or hereafter existing under this Agreement or any other
Loan Document owing to such Lender, irrespective of whether or not such Lender
shall have made any demand under this Agreement or any other Loan Document and
although such obligations may be unmatured; provided, that in the event
that any Defaulting Lender shall exercise any such right of setoff, (x) all
amounts so set off shall be paid over immediately to the Administrative Agent
for further application in accordance with the provisions of Section 2.17
and, pending such payment, shall be segregated by such Defaulting Lender from
its other funds and deemed held in trust for the benefit of the Administrative
Agent and the Lenders, and (y) the Defaulting Lender shall provide
promptly to the Administrative Agent a statement describing in reasonable
detail the Obligations owing to such Defaulting Lender as to which it exercised
such right of setoff.  The rights of each
Lender under this Section are in addition to other rights and remedies
(including other rights of setoff) which such Lender may have.

 

64

 

SECTION 9.09.  Governing Law; Jurisdiction; Consent to
Service of Process.  (a)  This
Agreement and the rights and obligations of the parties hereto shall be
governed by, and construed and interpreted in accordance with, the law of the
State of New York (excluding the laws applicable to conflicts or choice of law
to the extent that the application of the law of another jurisdiction would be
required thereby).

 

(a)           The Borrower hereby irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of the courts of the State of New York sitting in New York County
and of the United States District Court of the Southern District of New York,
and any appellate court from any thereof, in any action or proceeding arising
out of or relating to this Agreement or any other Loan Document, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in such New York State
court or, to the extent permitted by law, in such Federal court.  Each of the parties hereto agrees that a
final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.  Nothing in this
Agreement or in any other Loan Document shall affect any right that the
Administrative Agent or any Lender may otherwise have to bring any action or
proceeding relating to this Agreement or any other Loan Document against the
Borrower or its properties in the courts of any jurisdiction.

 

(b)           The Borrower hereby irrevocably and
unconditionally waives, to the fullest extent it may legally and effectively do
so, any objection which it may now or hereafter have to the laying of venue of
any suit, action or proceeding arising out of or relating to this Agreement or
any other Loan Document in any court referred to in paragraph (b) of this
Section.  Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such action or proceeding in any
such court.

 

(c)           Each party to this Agreement
irrevocably consents to service of process in the manner provided for notices
in Section 9.01.  Nothing in
this Agreement or in any other Loan Document will affect the right of any party
to this Agreement to serve process in any other manner permitted by law.

 

SECTION 9.10.  WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY).  EACH PARTY HERETO (A) CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT
IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT
AND THE OTHER LOAN 

 

65

 

DOCUMENTS BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

SECTION 9.11.  Headings.  Article and Section headings and
the Table of Contents used herein are for convenience of reference only, are
not part of this Agreement and shall not affect the construction of, or be
taken into consideration in interpreting, this Agreement.

 

SECTION 9.12.  Confidentiality.  Each of the Administrative Agent and the
Lenders agrees to maintain the confidentiality of the Information (as defined
below), except that Information may be disclosed (a) to its Affiliates and
to its and its Affiliates’ respective partners, directors, officers, employees,
agents, trustees, advisors and representatives (it being understood that the
Persons to whom such disclosure is made will be informed of the confidential
nature of such Information and instructed to keep such Information
confidential), (b) to the extent requested by any regulatory authority
purporting to have jurisdiction over it (including any self-regulatory
authority, such as the National Association of Insurance Commissioners), (c) to
the extent required by applicable laws or regulations or by any subpoena or
similar legal process, (d) to any other party hereto, (e) in
connection with the exercise of any remedies hereunder or under any other Loan
Document or any action or proceeding relating to this Agreement or any other
Loan Document or the enforcement of rights hereunder or thereunder, (f) subject
to an agreement containing provisions substantially the same as those of this
Section, to (i) any assignee of or Participant in, or any prospective
assignee of or Participant in, any of its rights or obligations under this
Agreement or any Eligible Assignee invited to be a Lender pursuant to Section 2.16
or (ii) any actual or prospective counterparty (or its advisors) to
any swap or derivative transaction relating to the Borrower and its
obligations, (g) with the consent of the Borrower or (h) to the
extent such Information (x) becomes publicly available other than as a
result of a breach of this Section or (y) becomes available to the
Administrative Agent, any Lender or any of their respective Affiliates on a
nonconfidential basis from a source other than the Borrower.

 

For purposes of this
Section, “Information” means all information received from the Borrower or any
Subsidiary relating to the Borrower or any Subsidiary or any of their
respective businesses, other than any such information that is available to the
Administrative Agent or any Lender on a nonconfidential basis prior to
disclosure by the Borrower or any Subsidiary, provided that, in the case
of information received from the Borrower or any Subsidiary after the date
hereof, such information is clearly identified at the time of delivery as confidential.  Any Person required to maintain the
confidentiality of Information as provided in this Section shall be
considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.

 

Each of the
Administrative Agent and the Lenders acknowledges that (a) the Information
may include material non-public information concerning the Borrower or a
Subsidiary, as the case may be, (b) it has developed compliance procedures
regarding the use of material non-public information and (c) it will
handle such material non-public information in accordance with applicable law,
including United States Federal and state securities laws.

 

SECTION 9.13.  Interest Rate Limitation.  Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Loan, together
with all fees, charges 

 

66

 

and other amounts which
are treated as interest on such Loan under applicable law (collectively the “Charges”),
shall exceed the maximum lawful rate (the “Maximum Rate”) which may be
contracted for, charged, taken, received or reserved by the Lender holding such
Loan in accordance with applicable law, the rate of interest payable in respect
of such Loan hereunder, together with all Charges payable in respect thereof,
shall be limited to the Maximum Rate and, to the extent lawful, the interest
and Charges that would have been payable in respect of such Loan but were not
payable as a result of the operation of this Section shall be cumulated
and the interest and Charges payable to such Lender in respect of other Loans
or periods shall be increased (but not above the Maximum Rate therefor) until
such cumulated amount, together with interest thereon at the Federal Funds
Effective Rate to the date of repayment, shall have been received by such
Lender.

 

SECTION 9.14.  No Advisory or Fiduciary Responsibility.  In connection with all aspects of each
transaction contemplated hereby (including in connection with any amendment,
waiver or other modification hereof or of any other Loan Document), the
Borrower acknowledges and agrees, and acknowledges its Affiliates’ understanding,
that: (i) (A) the arranging and other services regarding this
Agreement provided by the Administrative Agent and the Arranger are arm’s-length
commercial transactions between the Borrower and its Affiliates, on the one
hand, and the Administrative Agent and the Arranger, on the other hand, (B) the
Borrower has consulted its own legal, accounting, regulatory and tax advisors
to the extent it has deemed appropriate, and (C) the Borrower is capable
of evaluating, and understands and accepts, the terms, risks and conditions of
the transactions contemplated hereby and by the other Loan Documents; (ii) (A) the
Administrative Agent and the Arranger each is and has been acting solely as a
principal and, except as expressly agreed in writing by the relevant parties,
has not been, is not, and will not be acting as an advisor, agent or fiduciary
for the Borrower or any of its Affiliates, or any other Person and (B) neither
the Administrative Agent nor the Arranger has any obligation to the Borrower or
any of its Affiliates with respect to the transactions contemplated hereby
except those obligations expressly set forth herein and in the other Loan
Documents; and (iii) the Administrative Agent and the Arranger and their
respective Affiliates may be engaged in a broad range of transactions that
involve interests that differ from those of the Borrower and its Affiliates,
and neither the Administrative Agent nor the Arranger has any obligation to
disclose any of such interests to the Borrower or its Affiliates.  To the fullest extent permitted by law, the
Borrower  hereby waives and releases any
claims that it may have against the Administrative Agent and the Arranger with
respect to any breach or alleged breach of agency or fiduciary duty in
connection with any aspect of any transaction contemplated hereby.

 

SECTION 9.15.  USA Patriot Act.  Each Lender that is subject to the Act (as
hereinafter defined) and the Administrative Agent (for itself and not on behalf
of any Lender) hereby notifies the Borrower that pursuant to the requirements
of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the “Act”), it is required to obtain, verify and record
information that identifies the Borrower, which information includes the name
and address of the Borrower and other information that will allow such Lender
or the Administrative Agent, as applicable, to identify the Borrower in
accordance with the Act.  The Borrower
shall, promptly following a request by the Administrative Agent or any Lender,
provide all documentation and other information that the Administrative Agent
or such Lender 

 

67

 

requests in order to
comply with its ongoing obligations under applicable “know your customer” and
anti-money laundering rules and regulations, including the Act.

 

[Remainder of Page Left Intentionally Blank]

 

68

 

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.

 

 

	
   

  	
  Borrower:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  WADDELL &
  REED FINANCIAL, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Daniel P. Connealy

  
	
   

  	
  Name:

  	
  Daniel
  P. Connealy

  
	
   

  	
  Title:

  	
  Senior
  Vice President and Chief

  
	
   

  	
   

  	
  Financial
  Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Administrative
  Agent:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BANK
  OF AMERICA, N.A.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:
  

  	
  /s/
  Menna Cunningham

  
	
   

  	
  Name:

  	
  Menna
  Cunningham

  
	
   

  	
  Title:

  	
  Assistant
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Lenders:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BANK
  OF AMERICA, N.A.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Menna Cunningham

  
	
   

  	
  Name:

  	
  Menna
  Cunningham

  
	
   

  	
  Title:

  	
  Assistant
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  UMB
  BANK, N.A.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  David A. Proffitt

  
	
   

  	
  Name:

  	
  David
  A. Proffitt

  
	
   

  	
  Title:

  	
  Senior
  Vice President

  

 

WDR
Credit Agreement (2009)

 

 

	
   

  	
  Lenders (cont’d):

  
	
   

  	
   

  	
   

  
	
   

  	
  THE
  BANK OF NOVA SCOTIA

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  David Mahmood

  
	
   

  	
  Name:

  	
  David
  Mahmood

  
	
   

  	
  Title:

  	
  Managing
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CITIBANK,
  N.A.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Clay D. Norrbom

  
	
   

  	
  Name:

  	
  Clay
  D. Norrbom

  
	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  WELLS
  FARGO BANK, N.A.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Robert P. Callahan, Jr.

  
	
   

  	
  Name:

  	
  Robert
  P. Callahan, Jr.

  
	
   

  	
  Title:

  	
  Assistant
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  M &
  I MARSHALL & ILSLEY BANK

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  David T. Hunt

  
	
   

  	
  Name:

  	
  David
  T. Hunt

  
	
   

  	
  Title:

  	
  Vice
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BANK
  MIDWEST, N.A.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Brian Bower

  
	
   

  	
  Name:

  	
  Brian
  Bower

  
	
   

  	
  Title:

  	
  Vice
  President

  

 

WDR
Credit Agreement (2009)

 

 

	
   

  	
  Lenders
  (cont’d):

  
	
   

  	
   

  	
   

  
	
   

  	
  COMMERCE
  BANK, N.A.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  R. David Emley, Jr.

  
	
   

  	
  Name:

  	
  R. David Emley, Jr.

  
	
   

  	
  Title:

  	
  Vice President

  

 

WDR
Credit Agreement (2009)

 

 

SCHEDULE 2.01

 

COMMITMENTS

 

	
  Lender

  	
   

  	
  Commitment

  	
   

  
	
  Bank of America, N.A.

  	
   

  	
  $

  	
  24,000,000.00

  	
   

  
	
  UMB Bank, N.A.

  	
   

  	
  $

  	
  22,000,000.00

  	
   

  
	
  The Bank of Nova Scotia

  	
   

  	
  $

  	
  17,000,000.00

  	
   

  
	
  Citibank, N.A.

  	
   

  	
  $

  	
  17,000,000.00

  	
   

  
	
  Wells Fargo Bank, N.A.

  	
   

  	
  $

  	
  17,000,000.00

  	
   

  
	
  M & I
  Marshall & Ilsley Bank

  	
   

  	
  $

  	
  12,000,000.00

  	
   

  
	
  Bank Midwest, N.A.

  	
   

  	
  $

  	
  8,000,000.00

  	
   

  
	
  Commerce Bank, N.A.

  	
   

  	
  $

  	
  8,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
  $

  	
  125,000,000.00

  	
   

  

 

 

SCHEDULE 3.01

 

GOOD STANDING

 

None

 

 

SCHEDULE 3.04

 

FINANCIAL CONDITION

 

None

 

 

SCHEDULE 3.06

 

DISCLOSED MATTERS

 

None

 

 

SCHEDULE 3.13

 

SUBSIDIARIES

 

PART A

 

	
  Name

  	
   

  	
  Jurisdiction of

  Incorporation

  or Formation

  	
   

  	
  % of Capital Stock

  Owned by Borrower(1)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Waddell &
  Reed Financial Services, Inc.

  	
   

  	
  Missouri

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Waddell &
  Reed, Inc.

  	
   

  	
  Delaware

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Waddell &
  Reed Investment Management Company

  	
   

  	
  Kansas

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Waddell &
  Reed Services Company

  	
   

  	
  Missouri

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W&R
  Capital Management Group, Inc.

  	
   

  	
  Delaware

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W&R
  Corporate LLC

  	
   

  	
  Delaware

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy
  Investment Management Company

  	
   

  	
  Delaware

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy
  Funds Distributor, Inc.

  	
   

  	
  Florida

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W &
  R Insurance Agency, Inc.

  	
   

  	
  Missouri

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W &
  R Insurance Agency of Alabama, Inc.

  	
   

  	
  Alabama

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W &
  R Insurance Agency of Montana, Inc.

  	
   

  	
  Montana

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W &
  R Insurance Agency of Nevada, Inc.

  	
   

  	
  Nevada

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W &
  R Insurance Agency of Utah, Inc.

  	
   

  	
  Utah

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W &
  R Insurance Agency of Wisconsin, Inc.

  	
   

  	
  Wisconsin

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Unicon
  Agency, Inc.

  	
   

  	
  New
  York

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Unicon
  Insurance Agency of Massachusetts, Inc.

  	
   

  	
  Massachusetts

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fiduciary
  Trust Company of New Hampshire

  	
   

  	
  New
  Hampshire

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Legend Group Holdings, LLC

  	
   

  	
  Delaware

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Legend
  Advisory Corporation

  	
   

  	
  New
  York

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Legend
  Equities Corporation

  	
   

  	
  Delaware

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Advisory
  Services Corporation

  	
   

  	
  Nevada

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  Legend Group, Inc.

  	
   

  	
  Delaware

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LEC
  Insurance Agency, Inc.

  	
   

  	
  Texas

  	
   

  	
  100%

  

 

(1) Owned directly or indirectly through one or more wholly-owned
subsidiaries

 

 

PART B

 

Sciens
Capital Partners, L.P.

 

 

SCHEDULE 6.02

 

EXISTING INDEBTEDNESS

 

None

 

 

SCHEDULE 6.03

 

EXISTING LIENS

 

1.                                      Aircraft Lease, dated as of September 24,
2008 between Wilmington Trust Company, not in its individual capacity, but
solely as the Owner Trustee under Trust Agreement dated as of April 3,
2006 as Lessor and Waddell & Reed, Inc. as Lessee.

 

 

SCHEDULE 6.08

 

EXISTING RESTRICTIONS

 

None

 

 

SCHEDULE 6.10

 

SALE/LEASEBACK PROPERTIES

 

1.             6300 Lamar Avenue, Overland Park,
Kansas

 

2.             6301 Glenwood, Overland Park,
Kansas

 

 

SCHEDULE 9.01

 

ADMINISTRATIVE AGENT’S OFFICE;

CERTAIN ADDRESSES FOR NOTICES

 

BORROWER:

 

Waddell &
Reed Financial, Inc.

6300 Lamar Avenue

Overland Park, Kansas 66202

Attention: 
Daniel P. Connealy, Senior Vice President and Chief Financial Officer

Telephone: 913-236-2645

Telecopier:
913-236-1930

Electronic
Mail: dconneal@waddell.com

Website Address:                                               www.
waddell.com

U.S. Taxpayer Identification Number: 51-0261715

 

ADMINISTRATIVE AGENT:

 

Administrative
Agent’s Office

(for
payments and Requests for Borrowings):

Bank of America, N.A.

101 North Tryon Street

NC1-001-04-39

Charlotte, North Carolina 28255

Attention:  Eric Allen Smith

Telephone:  980.386.5115

Facsimile:  704.409.0273

Electronic Mail: eric.a.smith@bankofamerica.com

Account No.:   1366212250600

Ref:   Waddell & Reed Financial, Inc.

ABA# 026009593

 

Other Notices as Administrative
Agent:

Bank of America, N.A.

Agency Management Group

101 North Tryon Street

NC1-001-15-14

Charlotte, North Carolina 28255-0001

Attention: William A. Cessna

Telephone: 980.388.1639

Facsimile: 704.264.2501

Electronic Mail: william.a.cessna@bankofamerica.com

 

 

EXHIBIT A

 

ASSIGNMENT AND ASSUMPTION

 

This Assignment and Assumption (this “Assignment
and Assumption”) is dated as of the Effective Date set forth below and is
entered into by and between [the][each](1) Assignor identified in item 1 below ([the][each, an] “Assignor”)
and [the][each](2) Assignee identified in item 2 below
([the][each, an] “Assignee”).  [It
is understood and agreed that the rights and obligations of [the Assignors][the
Assignees](3) hereunder are several and not
joint.](4)  Capitalized terms used but not
defined herein shall have the meanings given to them in the Credit Agreement
identified below (the “Credit Agreement”), receipt of a copy of which is
hereby acknowledged by the Assignee.  The
Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby
agreed to and incorporated herein by reference and made a part of this
Assignment and Assumption as if set forth herein in full.

 

For an agreed consideration, [the][each] Assignor
hereby irrevocably sells and assigns to [the Assignee][the respective
Assignees], and [the][each] Assignee hereby irrevocably purchases and assumes
from [the Assignor][the respective Assignors], subject to and in accordance
with the Standard Terms and Conditions and the Credit Agreement, as of the
Effective Date inserted by the Administrative Agent as contemplated below (i) all
of [the Assignor’s][the respective Assignors’] rights and obligations in [its
capacity as a Lender][their respective capacities as Lenders] under the Credit
Agreement and any other documents or instruments delivered pursuant thereto to
the extent related to the amount and percentage interest identified below and (ii) to
the extent permitted to be assigned under applicable law, all claims, suits,
causes of action and any other right of [the Assignor (in its capacity as a
Lender)][the respective Assignors (in their respective capacities as Lenders)]
against any Person, whether known or unknown, arising under or in connection
with the Credit Agreement, any other documents or instruments delivered
pursuant thereto or the loan transactions governed thereby or in any way based
on or related to any of the foregoing, including, but not limited to, contract claims,
tort claims, malpractice claims, statutory claims and all other claims at law
or in equity related to the rights and obligations sold and assigned pursuant
to clause (i) above (the rights and obligations sold and assigned by
[the][any] Assignor to [the][any] Assignee pursuant to clauses (i) and (ii) above
being referred to herein collectively as [the][an] “Assigned Interest”).  Each such sale and assignment is without
recourse to [the][any] Assignor and, except as expressly provided in this
Assignment and Assumption, without representation or warranty by [the][any]
Assignor.

 

1.                                       Assignor[s]:                                                                          

 

(1)                                     For bracketed language here and elsewhere
in this form relating to the Assignor(s), if the assignment is from a single
Assignor, choose the first bracketed language. 
If the assignment is from multiple Assignors, choose the second
bracketed language.

 

(2)                                     For bracketed language here and elsewhere
in this form relating to the Assignee(s), if the assignment is to a single
Assignee, choose the first bracketed language. 
If the assignment is to multiple Assignees, choose the second bracketed
language.

 

(3)                                     Select as appropriate.

 

(4)                                     Include bracketed language if there are
either multiple Assignors or multiple Assignees.

 

A-1

 

                                                                

2.                                       Assignee[s]:                                                                         

                                                                

 

[for each Assignee, indicate [Affiliate][Approved
Fund] of [identify Lender]]

 

3.                                       Borrower:                                            Waddell & Reed Financial, Inc.

 

4.                                       Administrative Agent:  Bank
of America, N.A., as the administrative agent under the Credit Agreement

 

5.                                       Credit Agreement:                       Credit Agreement, dated as of October 5, 2009 (as
amended, restated, extended, supplemented or otherwise modified in writing from
time to time), among Waddell & Reed Financial, Inc., the Lenders
from time to time party thereto, and Bank
of America, N.A., as Administrative Agent

 

6.                                       Assigned Interest:

 

	
  Assignor[s](5)

  	
   

  	
  Assignee[s](6)

  	
   

  	
  Aggregate

  Amount of

  Commitment

  for all Lenders(7)

  	
   

  	
  Amount
  of

  Commitment

  Assigned

  	
   

  	
  Percentage

  Assigned of

  Commitment

  	
   

  	
  CUSIP

  Number

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
   

  	
  %

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
   

  	
  %

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
   

  	
  %

  	
   

  	
   

  

 

[7.                                   Trade Date:                                                                           ](8)

 

Effective Date:                                      ,
20     [TO BE INSERTED BY ADMINISTRATIVE AGENT AND
WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER
THEREFOR.]

 

(5)                                     List each Assignor, as appropriate.

 

(6)                                     List each Assignee, as appropriate.

 

(7)                                     Amounts in this column and in the column
immediately to the right to be adjusted by the counterparties to take into
account any payments or prepayments made between the Trade Date and the
Effective Date.

 

(8)                                     To be completed if the Assignor and the
Assignee intend that the minimum assignment amount is to be determined as of
the Trade Date.

 

A-2

 

The terms set forth in
this Assignment and Assumption are hereby agreed to:

 

	
   

  	
  ASSIGNOR

  
	
   

  	
  [NAME
  OF ASSIGNOR]

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  ASSIGNEE

  
	
   

  	
  [NAME
  OF ASSIGNEE]

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Title:

  
	
  [Consented
  to and](9) Accepted:

  	
   

  	
   

  

 

	
  BANK
  OF AMERICA, N.A., as

  	
   

  
	
  Administrative
  Agent

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  
	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  [Consented
  to:](10)

  	
   

  
	
   

  	
   

  
	
  WADDELL &
  REED FINANCIAL, INC.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  
	
  Title:

  	
   

  

 

(9)                                     To be added only if the consent of the
Administrative Agent is required by the terms of the Credit Agreement.

 

(10)                                To be added only if the consent of the
Borrower is required by the terms of the Credit Agreement.

 

A-3

 

ANNEX 1 TO
ASSIGNMENT AND ASSUMPTION

 

STANDARD TERMS AND CONDITIONS FOR

 

ASSIGNMENT AND ASSUMPTION

 

1.                                       Representations and Warranties.

 

1.1.                              Assignor.  [The][Each]
Assignor (a) represents and warrants that (i) it is the legal and
beneficial owner of [the][[the relevant] Assigned Interest, (ii) [the][such]
Assigned Interest is free and clear of any lien, encumbrance or other adverse
claim and (iii) it has full power and authority, and has taken all action
necessary, to execute and deliver this Assignment and Assumption and to
consummate the transactions contemplated hereby; and (b) assumes no
responsibility with respect to (i) any statements, warranties or
representations made in or in connection with the Credit Agreement or any other
Loan Document, (ii) the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Loan Documents or any collateral
thereunder, (iii) the financial condition of the Borrower, any of its
Subsidiaries or Affiliates or any other Person obligated in respect of any Loan
Document or (iv) the performance or observance by the Borrower, any of its
Subsidiaries or Affiliates or any other Person of any of their respective
obligations under any Loan Document.

 

1.2.                              Assignee.  [The][Each]
Assignee (a) represents and warrants that (i) it has full power and
authority, and has taken all action necessary, to execute and deliver this
Assignment and Assumption and to consummate the transactions contemplated
hereby and to become a Lender under the Credit Agreement, (ii) it meets
all the requirements to be an assignee under Section 9.04(b)(iii), (v) and
(vi) of the Credit Agreement (subject to such consents, if any, as
may be required under Section 9.04(b)(iii) of the Credit
Agreement), (iii) from and after the Effective Date, it shall be bound by
the provisions of the Credit Agreement as a Lender thereunder and, to the
extent of [the][the relevant] Assigned Interest, shall have the obligations of
a Lender thereunder, (iv) it is sophisticated with respect to decisions to
acquire assets of the type represented by [the][such] Assigned Interest and
either it, or the Person exercising discretion in making its decision to
acquire [the][such] Assigned Interest, is experienced in acquiring assets of
such type, (v) it has received a copy of the Credit Agreement, and has
received or has been accorded the opportunity to receive copies of the most
recent financial statements delivered pursuant to Section 5.01(a) and
Section 5.01(b) thereof, as applicable, and such other
documents and information as it deems appropriate to make its own credit
analysis and decision to enter into this Assignment and Assumption and to
purchase [the][such] Assigned Interest, (vi) it has, independently and
without reliance upon the Administrative Agent or any other Lender and based on
such documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Assignment and Assumption and
to purchase [the][such] Assigned Interest, and (vii) if it is a Foreign
Lender, attached hereto is any documentation required to be delivered by it pursuant
to the terms of the Credit Agreement, duly completed and executed by
[the][such] Assignee; and (b) agrees that (i) it will, independently
and without reliance upon the Administrative Agent, [the][any] Assignor or any
other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Loan Documents, and (ii) it will 

 

A-4

 

perform in accordance with their terms all of the
obligations which by the terms of the Loan Documents are required to be
performed by it as a Lender.

 

2.                                       Payments.  From and
after the Effective Date, the Administrative Agent shall make all
payments in respect of [the][each] Assigned Interest (including payments of
principal, interest, fees and other amounts) to [the][the relevant] Assignor
for amounts which have accrued to but excluding the Effective Date and to
[the][the relevant] Assignee for amounts which have accrued from and after the
Effective Date.

 

3.                                       General Provisions. 
This Assignment and Assumption shall be binding upon, and inure to the
benefit of, the parties hereto and their respective successors and
assigns.  This Assignment and Assumption
may be executed in any number of counterparts, which together shall constitute
one instrument.  Delivery of an executed
counterpart of a signature page of this Assignment and Assumption by
telecopy shall be effective as delivery of a manually executed counterpart of
this Assignment and Assumption.  This
Assignment and Assumption shall be governed by, and construed in accordance
with, the law of the State of New York (excluding the laws applicable to
conflicts or choice of law to the extent that the application of the law of
another jurisdiction would be required thereby).

 

A-5

 

EXHIBIT B

 

FORM OF NOTE

 

                          ,          

 

FOR VALUE RECEIVED, the undersigned (the “Borrower”),
hereby promises to pay to [NAME OF LENDER] or registered assigns (the “Lender”),
in accordance with the provisions of the Agreement (as hereinafter defined),
the principal amount of each Loan from time to time made by the Lender to the
Borrower under that certain Credit Agreement, dated as of October 5, 2009
(as amended, restated, extended, supplemented or otherwise modified in writing
from time to time, the “Agreement;” the terms defined therein being used herein as
therein defined), among the Borrower, the Lenders from time to time party
thereto, and Bank of America, N.A., as Administrative Agent.

 

The Borrower promises to pay interest on the unpaid
principal amount of each Loan from the date of such Loan until such principal
amount is paid in full, at such interest rates and at such times as provided in
the Agreement.  All payments of principal
and interest shall be made to the Administrative Agent for the account of the
Lender in dollars in immediately available funds at the Administrative Agent’s
Office.  If any amount is not paid in full
when due hereunder, such unpaid amount shall bear interest, to be paid upon
demand, from the due date thereof until the date of actual payment (and before
as well as after judgment) computed at the per annum rate set forth in the
Agreement.

 

This Note is one of the Notes referred to in the
Agreement, is entitled to the benefits thereof and may be prepaid in whole or
in part subject to the terms and conditions provided therein.  Upon the occurrence and continuation of one
or more of the Events of Default specified in the Agreement, all amounts then
remaining unpaid on this Note shall become, or may be declared to be,
immediately due and payable all as provided in the Agreement.  Loans made by the Lender shall be evidenced
by one or more loan accounts or records maintained by the Lender in the
ordinary course of business.  The Lender
may also attach schedules to this Note and endorse thereon the date, amount and
maturity of its Loans and payments with respect thereto.

 

The Borrower, for itself, its successors and assigns,
hereby waives diligence, presentment, protest and demand and notice of protest,
demand, dishonor and non-payment of this Note.

 

[Remainder of Page Left
Intentionally Blank]

 

B-1

 

THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (EXCLUDING THE LAWS
APPLICABLE TO CONFLICTS OR CHOICE OF LAW TO THE EXTENT THAT THE APPLICATION OF
THE LAW OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY).

 

	
   

  	
  WADDELL &
  REED FINANCIAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

B-2

 

LOANS AND PAYMENTS WITH
RESPECT THERETO

 

	
  Date

  	
   

  	
  Type of

  Loan Made

  	
   

  	
  Amount of

  Loan Made

  	
   

  	
  End of

  Interest

  Period

  	
   

  	
  Amount of

  Principal or

  Interest Paid

  This Date

  	
   

  	
  Outstanding

  Principal

  Balance This

  Date

  	
   

  	
  Notation

  Made By

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

B-3

 

Exhibit C-1

 

WADDELL
& REED, INC. MUTUAL FUND MANAGEMENT FEES

2009
Actual ($000)

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  % Inc

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  (Dec)

  	
   

  	
  Total

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  % of

  	
   

  	
  Variance

  	
   

  	
  2008

  	
   

  	
  Year

  	
   

  
	
  Management
  Fees

  	
   

  	
  Jan

  	
   

  	
  Feb

  	
   

  	
  Mar

  	
   

  	
  Apr

  	
   

  	
  May

  	
   

  	
  Jun

  	
   

  	
  Jul

  	
   

  	
  Aug

  	
   

  	
  Sep

  	
   

  	
  Oct

  	
   

  	
  Nov

  	
   

  	
  Dec

  	
   

  	
  Y-T-D

  	
   

  	
  Total

  	
   

  	
  From L-Y

  	
   

  	
  Actual

  	
   

  	
  2008

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W&R
  ADVISORS FUNDS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Con’t
  Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Retirement
  Shares

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset
  Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend
  Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Growth/Income
  Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Accumulative

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science &
  Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Int’l
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tax-Managed
  Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Vanguard

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  New
  Concepts

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small
  Cap

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core
  Investment

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Equity
  Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High
  Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Gov’t
  Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fixed
  Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL
  LONG-TERM FUNDS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cash
  Management

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL W&R ADVISORS FUNDS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  IVY
  FUNDS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset
  Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend
  Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Growth/Income
  Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core
  Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small
  Cap

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science &
  Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Large
  Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid
  Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Capital
  Appreciation

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pacific
  Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global
  Natural Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  European
  Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cundill
  Global Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Micro
  Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real
  Estate Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

C-1

 

WADDELL &
REED, INC. MUTUAL FUND MANAGEMENT FEES

2009
Actual ($000)

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  % Inc

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  (Dec)

  	
   

  	
  Total

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  % of

  	
   

  	
  Variance

  	
   

  	
  2008

  	
   

  	
  Year

  	
   

  
	
  Management
  Fees

  	
   

  	
  Jan

  	
   

  	
  Feb

  	
   

  	
  Mar

  	
   

  	
  Apr

  	
   

  	
  May

  	
   

  	
  Jun

  	
   

  	
  Jul

  	
   

  	
  Aug

  	
   

  	
  Sep

  	
   

  	
  Oct

  	
   

  	
  Nov

  	
   

  	
  Dec

  	
   

  	
  Y-T-D

  	
   

  	
  Total

  	
   

  	
  From L-Y

  	
   

  	
  Actual

  	
   

  	
  2008

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small
  Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed
  European/Pacific

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed
  International Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Equity
  Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  IVY
  FUNDS (cont)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Limited-Term
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High
  Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage
  Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fixed
  Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money
  Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL IVY FUNDS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  IVY
  VIP FUNDS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core
  Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High
  Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money
  Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small
  Cap

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset
  Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science &
  Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend
  Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real
  Estate Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage
  Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid
  Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global
  Natural Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small
  Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Microcap
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL IVY VIP FUNDS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  GRAND TOTAL MGMT. FEES

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  DAILY
  AVERAGE

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fixed

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money
  Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

C-2

 

	
  Change in Mutual Fund Assets Under Management

  	
   

  	
   

  	
  August 2009

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (Millions)

  	
   

  	
   

  	
  Month to Date

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

	
   

  	
   

  	
  Net Assets

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Net

  	
   

  	
  Net

  	
   

  	
  Dividends

  	
   

  	
  Net Investment

  	
   

  	
  Dividends

  	
   

  	
  Valuation

  	
   

  	
  Net Assets

  	
   

  
	
   

  	
   

  	
  at 7-31-09

  	
   

  	
  Sales

  	
   

  	
  Redemptions

  	
   

  	
  Sales

  	
   

  	
  Exchanges

  	
   

  	
  Reinvested

  	
   

  	
  Income

  	
   

  	
  Paid

  	
   

  	
  Change

  	
   

  	
  at 8-31-09

  	
   

  
	
  Waddell & Reed Advisors Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Accumulative

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset
  Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cont
  Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core
  Investment

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend
  Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Government
  Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High
  Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  New
  Concepts

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Retire
  Shares

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science &
  Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small
  Cap

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tax-Managed
  Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Vanguard

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal of Long -Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cash
  Management

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Waddell & Reed Advisors Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset
  Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Capital
  Appreciation

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core
  Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cundill
  Global Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend
  Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  European
  Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global
  Natural Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High
  Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Large
  Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Limited-Term
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed
  European/Pacific

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed
  Int’l Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Microcap
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

C-3

 

	
  Change in Mutual Fund Assets Under Management

  	
   

  	
   

  	
  August 2009

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (Millions)

  	
   

  	
   

  	
  Month to Date

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

	
   

  	
   

  	
  Net Assets

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Net

  	
   

  	
  Net

  	
   

  	
  Dividends

  	
   

  	
  Net Investment

  	
   

  	
  Dividends

  	
   

  	
  Valuation

  	
   

  	
  Net Assets

  	
   

  
	
   

  	
   

  	
  at 7-31-09

  	
   

  	
  Sales

  	
   

  	
  Redemptions

  	
   

  	
  Sales

  	
   

  	
  Exchanges

  	
   

  	
  Reinvested

  	
   

  	
  Income

  	
   

  	
  Paid

  	
   

  	
  Change

  	
   

  	
  at 8-31-09

  	
   

  
	
  Mid
  Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage
  Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pacific
  Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real
  Estate

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science &
  Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small
  Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small
  Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tax-Managed
  Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal of Long -Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money
  Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal of Money Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less Eliminations- Underlying Funds of Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd
  Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd
  Conservative

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy VIP Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset
  Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced
  Port

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core
  Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend
  Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global
  Natural Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High
  Inc

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Microcap
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid
  Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money
  Mkt

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage
  Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder-
  Agressive Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder-
  Conservative Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder-
  Moderate Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder-
  Moderately Agressive Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder-
  Moderately Conservative Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real
  Estate

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science &
  Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

C-4

 

	
  Change in Mutual Fund Assets Under Management

  	
   

  	
   

  	
  August 2009

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (Millions)

  	
   

  	
   

  	
  Month to Date

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

	
   

  	
   

  	
  Net Assets

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Net

  	
   

  	
  Net

  	
   

  	
  Dividends

  	
   

  	
  Net Investment

  	
   

  	
  Dividends

  	
   

  	
  Valuation

  	
   

  	
  Net Assets

  	
   

  
	
   

  	
   

  	
  at 7-31-09

  	
   

  	
  Sales

  	
   

  	
  Redemptions

  	
   

  	
  Sales

  	
   

  	
  Exchanges

  	
   

  	
  Reinvested

  	
   

  	
  Income

  	
   

  	
  Paid

  	
   

  	
  Change

  	
   

  	
  at 8-31-09

  	
   

  
	
  Small
  Cap Port

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small
  Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less Eliminations- Underlying Funds of Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy VIP Funds Total *

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Summary of All Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Long-Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Market Funds **

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less Eliminations- Underlying InvestEd Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  All Mutual Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

C-5

 

	
  Change in
  Mutual Fund Assets Under Management

  	
  August 2009

  	
   

  
	
  (Millions)

  	
  Year to Date

  	
   

  

 

	
   

  	
   

  	
  Net Assets

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Net

  	
   

  	
  Net

  	
   

  	
  Dividends

  	
   

  	
  Net Investment

  	
   

  	
  Dividends

  	
   

  	
  Valuation

  	
   

  	
  Net Assets

  	
   

  
	
   

  	
   

  	
  at 12-31-08

  	
   

  	
  Sales

  	
   

  	
  Redemptions

  	
   

  	
  Sales

  	
   

  	
  Exchanges

  	
   

  	
  Reinvested

  	
   

  	
  Income

  	
   

  	
  Paid

  	
   

  	
  Change

  	
   

  	
  at 8-31-2009

  	
   

  
	
  Waddell & Reed Advisors Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Accumulative

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset
  Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cont
  Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core
  Investment

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend
  Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Government
  Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High
  Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  New
  Concepts

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Retire
  Shares

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science &
  Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small
  Cap

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tax-Managed
  Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Vanguard

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal of Long -Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cash
  Management

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Waddell & Reed Advisors Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset
  Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Capital
  Appreciation

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core
  Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cundill
  Global Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend
  Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  European
  Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global
  Natural Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High
  Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Large
  Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Limited-Term
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed
  European/Pacific

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed
  Int’l Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Microcap
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid
  Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

C-6

 

	
  Change in
  Mutual Fund Assets Under Management

  	
  August 2009

  
	
  (Millions)

  	
  Year to Date

  

 

	
   

  	
   

  	
  Net Assets

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Net

  	
   

  	
  Net

  	
   

  	
  Dividends

  	
   

  	
  Net Investment

  	
   

  	
  Dividends

  	
   

  	
  Valuation

  	
   

  	
  Net Assets

  	
   

  
	
   

  	
   

  	
  at 12-31-08

  	
   

  	
  Sales

  	
   

  	
  Redemptions

  	
   

  	
  Sales

  	
   

  	
  Exchanges

  	
   

  	
  Reinvested

  	
   

  	
  Income

  	
   

  	
  Paid

  	
   

  	
  Change

  	
   

  	
  at 8-31-2009

  	
   

  
	
  Mortgage
  Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pacific
  Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real
  Estate

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science &
  Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small
  Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small
  Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tax-Managed
  Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal of Long -Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money
  Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal of Money Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less Eliminations- Underlying Funds of Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd
  Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd
  Conservative

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy VIP Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset
  Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced
  Port

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core
  Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend
  Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global
  Natural Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High
  Inc

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Microcap
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid
  Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money
  Mkt

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage
  Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder-
  Agressive Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder-
  Conservative Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder-
  Moderate Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder-
  Moderately Agressive Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder-
  Moderately Conservative Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real
  Estate

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science &
  Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small
  Cap Port

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small
  Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

C-7

 

	
  Change in
  Mutual Fund Assets Under Management

  	
  August 2009

  	
   

  
	
  (Millions)

  	
  Year to Date

  	
   

  

 

	
   

  	
   

  	
  Net Assets

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Net

  	
   

  	
  Net

  	
   

  	
  Dividends

  	
   

  	
  Net Investment

  	
   

  	
  Dividends

  	
   

  	
  Valuation

  	
   

  	
  Net Assets

  	
   

  
	
   

  	
   

  	
  at 12-31-08

  	
   

  	
  Sales

  	
   

  	
  Redemptions

  	
   

  	
  Sales

  	
   

  	
  Exchanges

  	
   

  	
  Reinvested

  	
   

  	
  Income

  	
   

  	
  Paid

  	
   

  	
  Change

  	
   

  	
  at 8-31-2009

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less Eliminations- Underlying Funds of Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy VIP Funds Total*

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Summary of All Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Long-Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Market Funds **

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less Eliminations- Underlying InvestEd Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  All Mutual Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

C-8

 

 

Exhibit
C-2

 

Waddell & Reed Financial, Inc. - Consolidated

Statement of Operations

For
the period indicated in each column heading

Dollar
amounts in thousands except per share amounts

 

	
   

  	
   

  	
  QTD

  	
   

  	
  QTD

  	
   

  	
  Variance

  	
   

  	
  Variance

  	
   

  	
  QTD

  	
   

  	
  QTD

  	
   

  	
  Variance

  	
   

  	
  Variance

  	
   

  	
  YTD

  	
   

  	
  YTD

  	
   

  	
  Variance

  	
   

  	
  Variance

  	
   

  
	
   

  	
   

  	
  Aug-2009

  	
   

  	
  May-2009

  	
   

  	
  Dollars

  	
   

  	
  Percent

  	
   

  	
  Aug-2009

  	
   

  	
  Aug-2008

  	
   

  	
  Dollars

  	
   

  	
  Percent

  	
   

  	
  Aug-2009

  	
   

  	
  Aug-2008

  	
   

  	
  Dollars

  	
   

  	
  Percent

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  REVENUES:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Investment
  management fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Underwriting &
  distribution fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Shareholder
  service fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Investment &
  other revenue

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL
  REVENUE

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

	
   

  	
   

  	
  Aug-2008

  	
   

  	
  Sep-2008

  	
   

  	
  Oct-2008

  	
   

  	
  Nov-2008

  	
   

  	
  Dec-2008

  	
   

  	
  Jan-2009

  	
   

  	
  Feb-2009

  	
   

  	
  Mar-2009

  	
   

  	
  Apr-2009

  	
   

  	
  May-2009

  	
   

  	
  Jun-2009

  	
   

  	
  Jul-2009

  	
   

  	
  Aug-2009

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  REVENUES:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Investment
  management fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Underwriting &
  distribution fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Shareholder
  service fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Investment &
  other revenue

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL
  REVENUE

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

C-2-1

 

 

EXHIBIT D

 

FORM OF
REVOLVING BORROWING REQUEST

 

Date:                        ,
                

 

To:          Bank of America,
N.A., as Administrative Agent

 

Ladies and Gentlemen:

 

Reference is made to that certain Credit Agreement,
dated as of October 5, 2009 (as amended, restated, extended, supplemented
or otherwise modified in writing from time to time, the “Agreement;” the
terms defined therein being used herein as therein defined), among Waddell &
Reed Financial, Inc. (the “Borrower”), the several financial institutions
from time to time party thereto (collectively, the “Lenders” and each
individually, a “Lender”), and Bank of America, N.A., as administrative
agent for the Lenders (in such capacity, together with any successors thereto
in such capacity, the “Administrative Agent”).

 

The
undersigned hereby requests (select one):

 

o  A
Borrowing of Loans

 

o  A
conversion or continuation of Loans

 

1.          On                                                         
(a Business Day).

 

2.          In
the amount of $                                           

 

3.          Comprised
of                                                                       

                                                                    [Type
of Loan requested/converted/continued]

 

4.          For
Eurodollar Loans:  with an Interest
Period of         months

 

5.          For
Borrowings: to be disbursed to the following account of the Borrower

 

                                                        

                                                        

                                                        

                                                        

                                                        

 

[The Borrowing requested
herein complies with the proviso to the first sentence of Section 2.01
of the Agreement.]

 

D-1

 

The Borrower hereby represents and warrants that the
conditions specified in Sections 4.02(a) and (b) shall be
satisfied on and as of the date of the applicable Borrowing.](11)

 

	
   

  	
  WADDELL & REED FINANCIAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

(11)           Include these sentences in the case
of a Borrowing of Loans.

 

D-2

 

EXHIBIT E

 

FORM OF
COMPLIANCE CERTIFICATE

 

Financial Statement Date:                  ,            

 

To:          Bank of America,
N.A., as Administrative Agent

 

Ladies and Gentlemen:

 

Reference is made to that certain Credit Agreement,
dated as of October 5, 2009 (as amended, restated, extended, supplemented
or otherwise modified in writing from time to time, the “Agreement;” the
terms defined therein being used herein as therein defined), among Waddell &
Reed Financial, Inc. (the “Borrower”), the several financial
institutions from time to time party thereto (collectively, the “Lenders”
and each individually, a “Lender”), and Bank of America, N.A., as
administrative agent for the Lenders (in such capacity, together with any
successors thereto in such capacity, the “Administrative Agent”).

 

The undersigned hereby certifies as of the date hereof
that he/she is the                                                               
(12) of the Borrower, and that, as such, he/she is
authorized to execute and deliver this Certificate to the Administrative Agent
on the behalf of the Borrower, and that:

 

[Use
following paragraph 1 for fiscal year-end financial statements]

 

1.             The
Borrower has delivered the year-end financial statements required by Section 5.01(a) of
the Agreement for the fiscal year of the Borrower ended as of the above date.

 

[Use
following paragraph 1 for fiscal quarter-end financial statements]

 

1.             The
Borrower has delivered the financial statements required by Section 5.01(b) of
the Agreement for the fiscal quarter of the Borrower ended as of the above date.

 

2.             The
undersigned has reviewed and is familiar with the terms of the Agreement and
has made, or has caused to be made under his/her supervision, a detailed review
of the transactions and condition (financial or otherwise) of the Borrower
during the accounting period covered by such financial statements.

 

3.             A
review of the activities of the Borrower during such fiscal period has been
made under the supervision of the undersigned with a view to determining
whether during such fiscal period the Borrower performed and observed all its obligations
under the Loan Documents, and

 

[select one:]

 

(12) Must be a Financial Officer.

 

E-1

 

[to the best knowledge of the undersigned, during such
fiscal period the Borrower performed and observed each covenant and condition
of the Loan Documents applicable to it, and no Default has occurred and is
continuing.]

 

—or—

 

[to the best knowledge of the undersigned, the
following covenants or conditions have not been performed or observed and the
following is a list of each such Default and its nature and status:]

 

4.             Since
the date of the financial statements furnished pursuant to Section 3.04
of the Agreement, to the best knowledge of the undersigned,

 

[select one:]

 

[no change in GAAP or in the application thereof has
occurred.]

 

—or—

 

[the following changes in GAAP have occurred, and the
effect of such change on the financial statements accompanying this Certificate
is as follows:]

 

6.             The
financial covenant analyses and information set forth on Schedule 1
attached hereto are true and accurate on and as of the date of this
Certificate.

 

[Remainder of Page Left Intentionally Blank]

 

E-2

 

IN WITNESS WHEREOF, the
undersigned has executed this Certificate as of                                    ,                        .

 

	
   

  	
  WADDELL & REED FINANCIAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

E-3

 

For the Quarter/Year ended                                       ,
         (“Statement Date”)

 

SCHEDULE 1

to the Compliance Certificate

($ in 000’s)

 

	
  I.

  	
  Section 6.01(a) – Consolidated Leverage Ratio.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  A.

  	
  Consolidated Total Debt at Statement Date

  	
   

  	
  $            

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  B.

  	
  Consolidated EBITDA for the period of four consecutive fiscal
  quarters of the Borrower ending on above date (“Subject Period”):

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  1.

  	
  Consolidated Net Income for Subject Period:

  	
   

  	
  $            

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  2.

  	
  Income tax expense for Subject Period:

  	
   

  	
  $            

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  3.

  	
  Interest expense, amortization or writeoff of debt discount and debt
  issuance costs and commissions, discounts and other fees and charges
  associated with Indebtedness (including the Loans) for Subject Period:

  	
   

  	
  $            

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  4.

  	
  Depreciation and amortization expenses for Subject Period:

  	
   

  	
  $            

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  5.

  	
  Amortization of intangibles (including, but not limited to, goodwill)
  and organization costs for Subject Period:

  	
   

  	
  $            

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  6.

  	
  Extraordinary, unusual or non-recurring non-cash expenses or losses
  (including, whether or not otherwise includable as a separate item in the
  statement of Consolidated Net Income for such period, non-cash losses on
  sales of assets outside of the ordinary course of business) for Subject
  Period:

  	
   

  	
  $            (13)

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  7.

  	
  Other non-cash reductions of Consolidated Net Income for Subject
  Period:

  	
   

  	
  $            

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  8.

  	
  Consolidated EBITDA (Lines I.B.1 + 2 + 3 + 4 + 5 + 6 + 7):

  	
   

  	
  $            

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  C.

  	
  Consolidated Leverage Ratio (Line I.A  ̧
  Line I.B.8): 

  	
   

  	
              to
  1

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Must not equal or exceed a ratio of 3.0 to 1.0

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  In Compliance: Yes / No

  	
   

  	
   

  

 

(13) 
AMOUNTS REFERRED TO IN LINE I.B.6 SHALL NOT, IN THE AGGREGATE, EXCEED
$1,000,000 FOR ANY FISCAL YEAR OF THE BORROWER.

 

E-4

 

	
  II.

  	
  Section 6.01(b) – Consolidated Interest Coverage Ratio.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  A.

  	
  Consolidated EBITDA for Subject Period (Line I.B.8 above):

  	
   

  	
  $

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  B.

  	
  Consolidated Interest Expense for Subject Period:

  	
   

  	
  $

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  C.

  	
  Consolidated Interest Coverage Ratio (Line II.A  ̧
  Line II.B):

  	
   

  	
              to
  1

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Must not be less than or equal to a ratio
  of 4.0 to 1.0.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  In Compliance: Yes / No

  	
   

  	
   

  

 

E-5Exhibit 10.1

 

EXECUTION COPY

 

CONTRACT OF EMPLOYMENT

 

(including particulars of terms of employment
required

by the Employment Rights Act 1996)

 

	
  EMPLOYER

  	
  TRAVELPORT INTERNATIONAL LTD of Axis One, Axis Park, 10 Hurricane
  Way, Langley, Berkshire SL3 8AG United Kingdom. Registered company number
  1254977 England (“the Company”).

  
	
   

  	
   

  
	
  EMPLOYEE

  	
  Philip Emery

  
	
   

  	
   

  
	
  DATE

  	
  1 October 2009

  

 

1.             Commencement of employment

 

Your employment with the Company began on
11th September 2006 which is the date of commencement of your period of
continuous employment. Your new role will commence 1st October 2009.

 

2.             Job title

 

You are employed as Chief
Financial Officer, Travelport at Senior
Executive Leadership level.  The content
of your job may be varied from time to time.

 

3.             Duties

 

3.1.          You
will carry out such duties and comply with such instructions   consistent with your position and status as
the Company reasonably determines from time to time.

 

3.2.          You
will primarily report to Jeff Clarke, the President and CEO of Travelport (or
his successor), and will also report to Gordon Wilson, President and CEO of
Travelport GDS (or his successor); provided, however, that the Company may
change this reporting relationship so that you have substantially equivalent
accountability and responsibility.

 

4.             Place of work

 

4.1.          Your
normal place of work will be the Company’s offices at Langley.

 

4.2.          You
may be required to undertake business trips or temporary work placements within
the UK and abroad in the course of the performance of your duties.

 

 

4.3.          You
may be required to work on a permanent basis at any other (current or future)
premises of the Company or any Group Company within a radius of 50 miles of
Langley. If as a result of such relocation you are required to move home your
relocation expenses will be refunded to the extent provided for in the
Company’s relocation policy in accordance with the terms of that policy which
may be revised from time to time.

 

5.             Remuneration

 

5.1.          Your
basic salary is £285,000 per annum effective 1st October 2009. 
This basic salary is payable monthly in arrears in accordance with the
Company’s normal payroll practices by electronic transfer direct to your bank.

 

5.2.          Your
salary will be reviewed annually. Salary review does not automatically entitle
you to a salary increase.

 

5.3.          You
are required to inform the Company’s payroll department without delay if an
over or under payment of salary, expenses or any other benefit is mistakenly
made to you.

 

6.             Expenses

 

If you incur travelling
expenses (other than travel to and from work), accommodation or other expenses
in the course of carrying out your duties, you will be reimbursed for these by
the Company on production of appropriate vouchers or receipts in accordance
with the Company’s current policy on expenses, a copy of which appears on the
Company Intranet.

 

7.             Perquisites

 

During your employment you
will be provided with perquisites for UK executives at your level, including
without limitation, car allowance, financial planning and travel allowance,
subject to the prevailing rules, policy or plan, which may be revised from time
to time; provided, however, that you will continue to be permitted to use your
travel allowance for commuting.  Your
eligibility to participate in these schemes and to receive benefits under them
shall cease upon termination of your employment for whatever reason. The
Company reserves the right to vary, replace or discontinue all or any of these
perquisites from time to time.

 

8.             Hours of Work

 

8.1.          Your
normal hours of work are from 9.00 am until 5.15 pm Monday to Friday inclusive
with a 45 minute break for lunch. The Company reserves the right to vary your
normal hours of work at its discretion to meet 

 

2

 

business needs
and/or improve operational efficiency but without increasing the normal number
of hours worked.

 

8.2.          You
will be required to work such additional hours as may be necessary for the
proper performance of your duties, for which you will receive no additional
payment.

 

8.3.          You
agree that the maximum weekly working time limits in regulation 4 (1) of the
Working Time Regulations 1998 do not apply to you, and that you shall give the
Company three months notice in writing if you wish regulation 4 (1) to apply to
you.

 

8.4.          You
agree to co-operate fully in assisting the Company to maintain such records of
your working hours as may be required from time to time.

 

9.             Holidays and holiday pay

 

9.1.          The
holiday year runs from 1 January to 31 December.

 

9.2.          You
are entitled, in addition to the usual public holidays, to 25 working days’
paid holiday in each holiday year of employment, increasing to 27 days after
five continuous years’ service and 29 days after ten continuous years’
service.  Holidays shall be paid at your
basic rate of pay.

 

9.3.          If
the 5th and 10th anniversaries of your commencement date fall
during the first six months of a holiday year then your two day increase of
holiday entitlement will be available to you following the anniversary date.  If these anniversaries fall during the second
six months of a holiday year then your holiday entitlement following the
anniversary date will increase by only one day for that year.

 

9.4.          Where
you are employed for a part of a holiday year only — either on commencement or
termination of your employment  — you
will be entitled to paid holiday pro rata to the number of complete calendar
months worked by you in the relevant holiday year.

 

9.5.          The
dates of any period of holiday must be approved by your manager.  Although the Company will agree to your
proposed holiday dates wherever possible, it reserves the right to withhold
approval where necessary for administrative or business reasons.  Consent will not normally be given to your
taking more than ten consecutive working days holiday.

 

9.6.          In
exceptional circumstances and with the prior written consent of your Manager,
up to five days unused holiday entitlement may be carried 

 

3

 

forward to the
next year.  Any such days must be taken
by 31 March in the next holiday year.

 

9.7.          On
the termination of your employment, where you have taken more or less than your
accrued holiday entitlement as calculated above, an adjustment based on your
normal rate of pay will be made to your final pay by way of a deduction or an
additional payment as appropriate.

 

10.          Sickness and sick pay

 

10.1.        If
you are absent from work due to sickness or injury or for any other reason you
must let the Company know by 10.00 am on your first day of absence that you
will be unable to attend.  If it is not
possible for you or someone on your behalf to contact the Company by this time
then you must ensure that contact is made as soon as is reasonably practical
thereafter.  If you are absent over a
period of time, you must keep the Company advised regularly of your progress
and of your likely return date.  Your
manager will be your first point of contact for these purposes.

 

10.2.        If
you are absent due to sickness or injury for half a day or more, immediately
you return to work you must complete a sickness self-certification form and
submit it to your manager for his/her signature and authorisation.  Template self-certification forms are
available on the Company’s Intranet.

 

10.3.        If
you are absent for more than seven consecutive days (including Saturdays and
Sundays) due to sickness or injury you must obtain a doctor’s certificate in
respect of your absence to date and any anticipated future absence and give it
or send it immediately to your manager. 
Thereafter any further absence must continue to be supported by doctor’s
certificates.  If you wish to return to
work following a period of sickness absence and your doctor’s certificate is
for an open ended period or for a period which has not expired then the Company
will only allow you to return to work if you submit a further doctor’s
certificate confirming that you are once more fit for work.

 

10.4.        Failure
to comply with the above procedures may result in the loss of Company sick pay
(referred to below) and may also disqualify you from receiving Statutory Sick
Pay (“SSP”).

 

10.5.        The
Company’s sick pay year runs from 1 April to 31 March.  Provided you have complied with the
requirements detailed above, and subject to your length of continuous service,
the Company will continue to pay you at your normal rate of pay during any
unavoidable absence through sickness or injury in any given sick pay year
(whether the absence is continuous or intermittent) for a period of 26 weeks.

 

4

 

Any payment made to you
under this provision will include any entitlement which you may have to receive
SSP from the Company.  Company sick pay
will be reduced by the amount of any Social Security benefits recoverable by
you (whether or not recovered) in respect of your illness or injury.  Any payments made in addition to your
entitlement to

 

Company sick pay as detailed
above will be made entirely at the Company’s discretion.

 

10.6.        Where
the relevant anniversary of your commencement of employment falls part way
through a sick pay year your entitlement to Company sick pay for the sick pay
year in question will increase immediately upon that anniversary date, but any
sick pay already paid to you during that sick pay year will be offset against
your new entitlement.

 

10.7.        If
you are absent during one sick pay year (“year 1”) and your absence continues
into the next sick pay year (“year 2”) or if your absence in year 2 commences
within four weeks of your absence in year 1 then the absence which falls in year
2 will be regarded as if it had fallen within year 1 and your entitlement to
Company sick pay will be calculated by reference to your unexhausted sick pay
entitlement (if any) for year 1.  In this
case you will only qualify to claim Company sick pay in respect of your
entitlement for year 2 once you have returned to work for a continuous period
of at least four working weeks before incurring any further sickness
absence.  Until you have qualified to
receive Company sick pay in year 2 as described above any further absence from
work due to sickness or injury will also be regarded as having occurred in year
one.

 

10.8.        You
may be eligible to receive SSP payments before you become entitled to Company
sick pay or once your entitlement to Company sick pay in any given sick pay
year has been exhausted in which case you will receive payment at the SSP rate
during your absence until your SSP entitlement has been exhausted. Your
“qualifying days” for SSP purposes are Monday to Friday (inclusive).

 

10.9.        If
you are absent from work due to an accident which occurred or a condition which
was sustained as a result of the act or omission of a third party any sick pay
paid to you by the Company in respect of your absence will be paid as a loan
which you must repay to the Company if you are successful in recovering damages
in respect of your absence from work.

 

10.10.      The
Company will be entitled, at its expense, to require you to be examined by an
independent medical practitioner of the Company’s 

 

5

 

choice at any
time (whether or not you are absent by reason of sickness or injury) and you
agree that the doctor carrying out the examination may disclose to and discuss
with the Company the results of the examination.

 

10.11.      For
the avoidance of doubt the Company will be entitled to terminate your
employment in accordance with the terms of this Contract (whether with or
without notice as appropriate in the circumstances) during any period of
sickness absence.

 

11.          Pension and other benefits

 

11.1.        The
Company operates a defined contribution pension plan.  If you choose to join the pension plan then
your basic salary will be reduced by the amount that you elect to be invested
into the pension plan, in accordance with the membership category you
select.  Full details of the pension plan
and other benefits are shown in the Benefits’ Booklet.

 

11.2.        During
your employment you will be entitled to participate at the Company’s expense in
the Company’s schemes relating to the following:

 

(a)           private medical
expenses insurance;

 

(b)           permanent health
insurance;

 

(c)           life assurance;

 

(d)           Well Being
programme;

 

subject to the rules of these schemes which
may be revised from time to time.  Your
eligibility to participate in these schemes and to receive benefits under them
shall cease upon termination of your employment for whatever reason.

 

11.3.        Participation
in the permanent health insurance (PHI) scheme is strictly subject to the rules
of the scheme which may change from time to time.  You will be entitled to receive benefits
under the PHI scheme only in the circumstances and for so long as the Company
continues to receive benefits from the insurer who operates the scheme.  Your entitlement to receive benefits will
therefore cease if your employment is terminated or if you are able to work to
your normal capacity again, if you die, or if you reach normal retirement age
or if the insurer considers that you no longer satisfy the scheme’s other
eligibility requirements.

 

11.4.        The
Company reserves the right to vary, replace or discontinue all or any of these
schemes from time to time.

 

6

 

12.          Confidentiality

 

12.1.        You
shall not either during the continuance of your employment or at any time
thereafter:

 

(a)           disclose or communicate to
any person or permit or enable any person to acquire any Confidential Business
Information other than for any legitimate purposes of a Group Company; or

 

(b)           use or attempt to use any of
the Confidential Business Information in any manner which may injure or cause
loss either directly or indirectly to any Group Company or its Clients or may
be likely to do so or for any purpose other than in the discharge of your
duties hereunder; or

 

(c)           sell or seek to sell to
anyone Confidential Business Information other than for any legitimate purposes
of a Group Company; or

 

(d)           obtain or seek to obtain any
financial advantage direct or indirect from the disclosure of Confidential
Business Information other than for a Group Company.

 

During the continuance of
your employment and at all times thereafter you shall use your best endeavours
to prevent the unauthorised publication or disclosure of the Confidential
Business Information or any part thereof.

 

12.2.        This
Clause shall not apply to:

 

(a)           information or knowledge
which comes into the public domain other than in consequence of your default;

 

(b)           any information which you
have acquired other than through the performance of your duties for a Group
Company; or

 

(c)           any information which is
required to be disclosed by you by order of a court of competent jurisdiction
or an appropriate regulatory authority or otherwise required by law.

 

12.3.        Nothing
in this Agreement shall preclude you from making a protected disclosure for the
purposes of the Public Interest Disclosure Act 1998.

 

7

 

13.          Activities during your employment

 

13.1.        During
your employment you may only be engaged, concerned or interested (whether
directly or indirectly) in any other trade, business or occupation with the
prior written consent of the Company, as set forth in the Travelport Code of
Business Conduct & Ethics (“the Code”). Subject to the provisions of the
Code, the Company will not unreasonably withhold such consent but consent will
not be given where the outside activity in question gives rise to any conflict
of interest with regard to the Company’s business or if it is likely to detract
from the proper performance of your duties under this contract.

 

13.2.        During
your employment you must not, except with the Company’s written consent and
subject to the provisions of the Code, introduce to any other competing
business orders for goods or services with which the Company is able to deal.

 

13.3.        During
your employment you must not, except with the Company’s express written consent
or instructions, represent yourself as the Company’s authorised agent save as
is required in the normal course of your duties.  You must not communicate with any member of
the press or media or publish any letter, article or document on behalf of or
referring to the Company without the express prior permission of the Corporate
Communications Department.

 

14.          Intellectual Property

 

14.1.        All
copyright, design rights, database rights, trademarks, and any other
intellectual property rights (other than patents) in any software, databases,
specifications, manuals, prototypes, records, documents, (including all
material stored in computer readable form), drawings, designs, business ideas
or methods and any other material or work (the “Materials”) of any description
that is capable of protection under the intellectual property laws (other than
patent law) or laws of confidence of any country which is made, developed,
created, devised or designed (whether alone or with any other person) by you in
the course of your employment will be the property of and will belong to the
Company unless otherwise agreed in writing by the Company.

 

14.2.        You
agree that you will use the Materials only for the purpose of the Company’s
business and that you will return the Materials and all copies and extracts
from the Materials, to the Company on demand at any time and without demand on
the termination of your employment, howsoever arising.

 

8

 

14.3.        You
shall promptly disclose full details of all inventions, discoveries, processes
or formulae or any other matter which is capable of patent protection under the
intellectual property laws of any country which is made, created, developed, or
devised by you in the course of your employment (“Inventions”) in writing to a
Director of the Company, and shall if requested by the Company deliver to the
Company all copies and material representations of such Inventions in your
possession, custody or control.

 

14.4.        To
the extent that under the mandatory laws of any country an Invention or any
patent or other rights therein belongs to you, you shall on request by the
Company negotiate with the Company in good faith for the assignment or licence
of the Invention and such rights to the Company.

 

14.5.        All
other Inventions and all other rights therein shall belong to the Company, and,
to the extent not already legally owned by the Company, shall be held on trust
for the Company, and at the Company’s request and cost you shall execute any
documents and do all things necessary to substantiate the Company’s ownership
thereof and to obtain registration or protection thereof in any country.

 

14.6.        You
irrevocably appoint the Company to be your attorney in your name, and on your
behalf:

 

14.6.1.        to execute any
instrument, to do any thing, and generally to use your name for the purpose of
giving the Company (or its nominee) the full benefit of the provisions of
clauses 14.1 to 14.5 above; and

 

14.6.2.        to give to any
third party a certificate in writing (signed by a director or secretary of the
Company) confirming that any instrument or act falls within the authority
conferred by this clause; such a certificate will be deemed to be conclusive
evidence that this is the case.

 

14.7.        Save
as provided above, you shall keep all Inventions and all details thereof
confidential to yourself and any lawyer or patent agent instructed by you.  You shall not without the Company’s consent
apply for protection or registration in any country of any Invention belonging
to the Company and shall promptly inform the Company if you apply for
protection or registration of an Invention belonging to you in any country.

 

15.          Disciplinary and grievance procedure

 

The Company has disciplinary and grievance
procedures which appear on the Company intranet. The disciplinary and grievance
procedures are not incorporated by reference in this contract of employment and
therefore do not form part of your contract of employment.

 

9

 

16.          Termination of employment

 

16.1.        Subject
as follows the Company can terminate your employment at any time by giving you
12 months written notice.

 

16.2.        You
may terminate your employment at any time by giving the Company at least 12
months written notice.

 

16.3.

 

16.3.1.        After notice of
termination has been given by either you or the Company, provided that the
Company continues to provide you with your normal salary and contractual
benefits under this contract until your employment terminates, the Company may
at its absolute discretion at any time during your notice period:

 

(a)                exclude
you from the premises of the Company and/or any Group Company;

 

(b)                require
you to carry out specified duties other than your normal duties or to carry out
no duties;

 

(c)                require
you to return any property belonging to the Company which is in your
possession;

 

(d)                require
that you resign immediately from any offices you hold in any Group Company;

 

(e)                announce
to employees, suppliers and customers that you have been given notice of
termination or have resigned (as the case may be); and

 

(f)                 instruct
you not to communicate orally or in writing with suppliers, customers,
employees, agents or representatives of the Company or any Group Company until
your employment has terminated.

 

16.3.2.        Any outstanding
holiday entitlement accrued before or during a period of exclusion pursuant to
clause 16.3.1 should be used during the exclusion period with the prior
agreement of the Company.

 

16.4.        The
Company has the right to terminate your employment without notice if you breach
the material terms and conditions of your employment and/or in the case of
gross misconduct.  Gross misconduct
includes (but is not limited to) dishonesty, fraud, insider dealing, breach of
company confidentiality, pilferage, being under the influence of alcohol or
other 

 

10

 

substances at
work, flagrant disobedience of reasonable orders from superiors, causing actual
or threatening physical harm, harassment and causing damage to Company
property.

 

16.5.        The
Company may also terminate your employment (with or without notice depending
upon the severity of the case) if it discovers that you provided the Company
with false information or deliberately misled the Company when applying for
employment.

 

16.6.        The
Company reserves the right, at its discretion, to terminate this Contract
immediately without giving the period of notice referred to in clause 16.1 or
16.2 (as appropriate) by paying to you your basic salary (less deductions of
tax and national insurance) in lieu of all or part of your notice period as the
case may be.

 

16.7.        Should
you be involuntarily terminated for any reason other than cause (as determined
by the Company) or you resign in circumstances where you are entitled to resign
in response to a fundamental breach of contract by the Company, and provided
that you execute a compromise agreement that will be provided to you by the
Company in its standard form and that will include a release of all claims
against any Group Company or any of their directors, officers, agents or
employees, a non-competition provision for 12 months following your termination
of employment, and a non-solicitation provision for 12 months following your
termination from employment, you shall be entitled to receive the following
benefits, which, except as expressly provided herein in clause 16.6, shall be
in lieu of any severance or separation benefits under any and all other
severance plans, policies and agreements that may entitle you to severance or
separation benefits and which shall be less deductions of tax and national
insurance:

 

16.7.1.        A lump sum
payment that is equivalent to 12 months of your base annual salary at the time
of termination; and

 

16.7.2.        A lump sum
payment equal to your then current annual target bonus for the year in which
your employment terminates, pro-rated based upon the number of days you were
employed with the Company during the year of termination and for which you have
not otherwise received or been eligible for a bonus, and in lieu of any other
bonus for the period in which you are terminated.

 

16.8.        The May 1,
2009 Management Equity Awards Agreement between Executive and TDS Investor
(Cayman) L.P. (“the May 1, 2009 Award Agreement”) is hereby amended as
follows:

 

11

 

16.8.1.        Section 3.1(e) is
deleted in its entirety and replaced with the following:

 

(e) Notwithstanding the
foregoing in the event that:

 

(i)            a
Change in Control occurs at a time when Executive is employed by the Company,
Executive shall thereupon be deemed to have vested in the unvested Restricted
Equity Units at Target (including, for the avoidance of doubt, any Restricted
Equity Units that remain unvested due to the failure in any prior calendar year(s) to
achieve the Annual Goals at Target) 
immediately prior to such Change of Control (and such Restricted Equity
Units shall automatically convert to Vested Restricted Equity Units hereunder)
and any Restricted Equity Units that remain unvested after such conversion
shall be forfeited;

(ii)           Executive’s
employment with the Company is terminated by the Company other than for Cause,
by Executive as the result of a Constructive Termination, or as a result of
death or Disability, Executive shall be deemed to have vested in the unvested
Restricted Equity Units that would have vested assuming (1) that Executive’s
employment continued for eighteen (18) months following the termination of
Executive’s employment (“Accelerated Vesting Date”), (2) that the award
vests rateably on a monthly basis beginning on the prior Vesting Date through
the Accelerated Vesting Date over the remainder of the performance period that
ends on December 31, 2012, and (3) performance at Target.  For example, if Executive was terminated
without Cause on September 1, 2009, then Executive will receive 26/48ths vesting
of all unvested Restricted Equity Units as of the termination date at Target;
and

(iii)          Executive’s
employment with the Company is terminated for any reason, except as set forth,
and to the extent provided, in Sections 3.1(e)(i) and 3.1(e)(ii),
Executive shall have no right to further vesting of the Restricted Equity Units
that are Unvested Restricted Equity Units (and such Restricted Equity Units
shall be Unvested Restricted Equity Units notwithstanding the provisions of
this Section 3.1).

 

16.8.2.        The following
definition is added to Section 1.1. of the May 1, 2009 Award
Agreement:

 

“Constructive
Termination” shall have the meaning assigned such term in any
employment agreement entered into between any Company and Executive, provided
that if no such employment agreement exists or such term is not defined, then “Constructive

 

12

 

Termination” means (A) any
material reduction in Executive’s base salary or annual bonus opportunity
(excluding any change in value of equity incentives or a reduction affecting
substantially all similarly situated executives), (B) failure of the
Company or its affiliates to pay compensation or benefits when due, in each
case which is not cured within 30 days following the Company’s receipt of
written notice from Executive describing the event constituting a Constructive
Termination, (C) a material and sustained diminution to Executive’s duties
and responsibilities as of the date of this Agreement or (D) the primary
business office for Executive being relocated by more than 50 miles; provided
that any of the events described in clauses (A)-(D) of this definition of
“Constructive Termination” shall constitute a Constructive Termination only if
the Company fails to cure such event within 30 days after receipt from
Executive of written notice of the event which constitutes Constructive
Termination; provided further, that a “Constructive Termination” shall cease to
exist for an event on the 60th day following the later of its occurrence
thereof or Executive’s knowledge thereof, unless Executive has given the
Company written notice thereof prior to such date.

 

16.8.3.        The phrase “Subject to Section 3.1,” is
added at the beginning of Section 3.4(a).

 

16.8.4.        The title of Section 3.5 is amended to
“Partnership Agreement; Call Rights” and the following language is added at the
end of the existing language in that Section 3.5:

 

Notwithstanding the
foregoing or anything to the contrary in the Partnership Agreement, Class A-2
Interests delivered pursuant to a Restricted Equity Unit granted pursuant to
this Agreement shall not, until the earlier of (a) the end of the
Restricted Period (as defined below) or (b) the breach of any covenant
contained in Section 5 of this Agreement (the “No-Call
Period”), be (i) forfeitable pursuant to Article XII of
the Partnership Agreement or (ii) subject to the mandatory purchase
provisions of Article XII of the Partnership Agreement; provided that, in
each case, any time periods contained in the Partnership Agreement that would
otherwise have lapsed during the No-Call Period shall not begin to run until
after the expiration of such No-Call Period (or, if later, the date on which
the Partnership has actual knowledge of the expiration of such No-Call Period).

 

16.8.5.        The “Restricted
Period” as defined in Section 5.1(a) is changed from one (1) year
to two (2) years.

 

13

 

16.9.        The parties agree
that TDS Investor (Cayman) L.P. is party to this Agreement for the sole purpose
of agreeing to be bound by the provisions of clause 16.8.

 

16.10.      Upon termination
of the Employment howsoever arising you will:

 

16.10.1.      resign from all
offices, trusteeships or positions held by you in the Company (or any other
Group Company) and transfer all nominee shares held by you in the Company (or
any other Group Company) without compensation for loss of office or otherwise
and, should you fail to do so, your manager is irrevocably authorised to
appoint some person in your name and on your behalf to do, execute and perform
any acts, deeds, documents or things necessary to effect such resignation or
transfer;

 

16.10.2.      deliver (or, if
you are dead, of unsound mind or bankrupt, then your personal representatives
or such other persons as may be appointed to administer your estate and affairs
will deliver) up to the Company or its authorised representative all property
including (without limitation) all documents, records, keys, correspondence,
discs, tapes, telephones, credit cards or other items in your possession or
under his control which relate in any way to the business or affairs or
customers of the Company (or any other Group Company) or are the property of
the Company (or any other Group Company) and all extracts or copies of them
regardless of the medium on which such extracts or copies are stored or held;
and

 

16.10.3.      not at any time
after the termination wrongfully represent yourself as being a director of or
employed by or connected with the Company (or any other Group Company) nor make
or publish any untrue or misleading statement or comment about the Company (or
any other Group Company) or their respective officers and employees.

 

16.11.      You
acknowledge and agree that, notwithstanding that the personal contact is
between you and representatives of Clients, Suppliers, Agents and Distributors
(collectively referred hereafter as “Business Partners”), the relationship with
them is one which exists with the Company and is valuable to the Company and
that, so far as concerns those Business Partners whose business is handled by
you, it is capable of being damaged inter alia upon the cessation for any
reason of the contract of employment between the Company and you.  For the purposes of permitting the Company to
ensure so far as possible that any such damage is minimised, and so as to
preserve the Company’s relationship with its Business Partners after the
termination of the contract of employment, and to ensure the continued proper
servicing of the requirements of such Business Partners, you hereby undertake
generally

 

14

 

to co-operate
with the Company and comply with the instructions of the Board in securing the
handover of the affairs of any such Client, Agent, Supplier or Distributor to
any other employee(s) designated by the Company in a manner which will or
is designed to ensure that the Company’s relationship with such Client is
preserved and that the Client continues to receive a proper service from the
Company; and acknowledges that any breach of the above undertakings may cause
loss or damage to the Company for which it may reasonably seek compensation or
injunctive relief from you.

 

16.12.      With a view to
ensuring that your departure can be arranged with the minimum of inconvenience
or disruption to the business of the Company and its relationship with its
Clients and its other employees, you undertake to mutually agree with your
manager the timing and manner of any communication about your departure, and to
refrain from informing any of your colleagues (excluding your manager and the
Board of Travelport Limited or its successor) about the proposed cessation of
your employment hereunder, other than within the agreed communication plan.

 

16.13.      You acknowledge
the right of the Company to monitor and control the performance of its
employees and ensure the proper servicing of the requirements of its Clients,
and acknowledge the fiduciary obligations attaching to your position.

 

17.          Company Property

 

On request and in any event
on termination of your employment for any reason you are required to return to
the Company all company property including e.g. mobile phones,  computer hard and software including discs and all
documents in whatever form (including notes and minutes of meetings, customer
lists, diaries and address books, computer printouts, plans, projections)
together with all copies which are in your possession or under your
control.  The ownership of all such
property and documents will at all time remain vested in the Company.

 

18.          Restrictive Covenants

 

18.1           You acknowledge
that in the course of your employment you are likely to obtain knowledge of
Group Companies’ trade secrets and other confidential information and will have
dealings with Clients, Suppliers, Agents and Distributors (collectively
referred hereafter as Business Partners) and that the relationships with such
Business Partners are proprietary rights belonging to the relevant Group
Company and that it is fair and reasonable for the Company to seek to protect
the interests of the Group by the provisions of this clause 18.

 

15

 

18.2            You
shall not, either on your own account (whether directly or indirectly) as a
representative, employee, partner, director, financier, shareholder or agent of
any other person, firm, company or organisation:

 

(a)        at any time
during the Restricted Period hold any Material Interest in a business which is
either wholly or partially in competition with any of the Businesses;

 

(b)        at any time
during the Restricted Period, seek in any capacity whatsoever any business,
orders or custom for any Restricted Products or Restricted Services from any
Client with whom you have dealt at any time during the period of twelve months
prior to the Termination Date;

 

(c)        at any time
during the Restricted Period, accept in any capacity whatsoever orders for any
Restricted Products or Restricted Services from any Client with whom you have
dealt at any time during the period of twelve months prior to the Termination
Date;

 

(d)        at any time
before or after the Termination Date, induce or seek to induce by any means
involving the disclosure or use of Confidential Business Information any
Business Partner to cease dealing with a Group Company or to restrict or vary
the terms upon which it deals with the relevant Group Company;

 

(e)        at any time
during the Restricted Period be employed or engaged by any person who at any
time during the period of twelve months prior to the Termination Date shall
have been a Business Partner for the purpose of carrying out the same kind of
work as you have performed for that Business Partner during the period of
twelve months prior to the Termination Date;

 

(f)         at any time
during the Restricted Period approach, solicit or seek in any capacity
whatsoever any business, orders or custom for any Restricted Products or
Restricted Services from any Supplier, Agent or Distributor with whom you have
dealt at any time during the period of twelve months prior to the Termination
Date;

 

(g)        at any time
during the Restricted Period deal with or accept in any capacity whatsoever
orders for any Restricted Products or Restricted Services from any Supplier,
Agent or Distributor with whom you have dealt at any time during the period of
twelve months prior to the Termination Date;

 

(h)        at any time
during the Restricted Period endeavour to entice away from the relevant Group
Company or knowingly employ or engage

 

16

 

the services of or procure
or assist any third party so to employ or engage the services of any person who
shall have been an Employee;

 

(i)         at any time during the
Restricted Period endeavour to entice away from the relevant Group Company or
knowingly employ or engage the services of or procure or assist any third party
so to employ or engage the services of any person who shall have been providing
consultancy services to the relevant Group Company at any time in the period of
twelve months immediately prior to the Termination Date and who:

 

(i)        by reason of his engagement as a consultant
by such Group Company is likely to be able to assist a business in or intending
to be in competition with such Group Company so to compete; or

 

(ii)       by reason of his engagement as a consultant
by such Group Company is likely to be in possession of any Confidential Business
Information; or

 

(j)         at any time after the
Termination Date represent yourself or permit yourself to be held out by any
person, firm or company as being in any way connected with or interested in any
Group Company.

 

18.3       Whilst the restrictions referred to in this
clause are regarded by the parties hereto as fair and reasonable restrictions
to be imposed on you, it is hereby declared that the wording of this clause is
severable and so much of the same as a court of competent jurisdiction may
regard as unreasonable shall (so far as the same is possible) be deleted.

 

18.4       If after your employment ends you propose to
enter into any contract of employment, appointment or engagement you must
before so doing bring all the terms of this contract (particularly clauses 12,
14, 17 and 18) to the attention of any proposed new employer or organisation
appointing you.

 

19.          Normal retirement age

 

Your normal retirement age
is 65 years.

 

20.          Deductions

 

You hereby authorise the
Company to deduct from your pay (including holiday pay, sick pay, bonus and pay
in lieu of notice) any amounts which are owed by you to the Company or any
other company in the Group after due notification and authority

 

17

 

(including any costs incurred
by the Company under the provisions of the Company Car Policy as amended from
time to time).

 

21.          Rules policies, procedures

 

21.1.        You
must comply at all times with the Company’s rules policies and procedures
relating to equal opportunities, harassment, health and safety, e-mail and
internet use, insider trading and all other rules and procedures
introduced by the Company from time to time. 
Copies of all rules, policies and procedures appear in the Employee
Handbook.

 

21.2.        In
addition to those rules policies and procedures detailed in clause 21.1
above, you must comply at all times with the Code and any Code Supplements, as
amended from time to time. You will be given a copy of the Code annually, and
will also be made aware of any material updates.

 

21.3.        For
the avoidance of doubt the rules, policies and procedures detailed in clause
21.1 and the Code detailed in clause 21.2 above are not incorporated by
reference into this contract, are non-contractual and may be changed, replaced
or withdrawn at any time at the discretion of the Company.

 

21.4.        Any
breach of the Company rules, policies or procedures or the Code may result in
disciplinary action being taken against you, and in turn may, dependent upon
the circumstances and the seriousness of the matter concerned, result in the
termination of your employment.

 

22.          Data Protection

 

22.1.        You
agree that personal data (including sensitive data) relating to you which has
been or is in the future obtained by the Company may be held and processed by
the Company (and where necessary its agents or appointed third parties) either
by computer or manually for any purpose relating to the administration,
management and operation of your employment, or in relation to the Company’s
legal obligations or business needs.

 

22.2.        The
Group has offices in various countries throughout the world and it may be
necessary for one or more of the Group’s overseas offices to have access to
information held about you by the Company in the UK.  However it is only intended by the Company
that information about you will be used by the Group’s overseas offices for the
purpose of enabling the Group to deal with personal issues connected with your
employment, including advising relevant statutory authorities in order to
obtain a work permit or visa or assisting in your secondment to an overseas
office or for pay roll purposes.  You
agree that the Company may where appropriate

 

18

 

transfer personal data (including sensitive data) relating to you to
the Group’s overseas offices.

22.3.        You
agree and give authorisation that your company electronic mail and computing
resources will be accessible to the company without any further prior consent
during your employment and where appropriate after leaving the company. All
user ID and passwords combinations may be reset for access in appropriate
business circumstances.

 

23.          Entire agreement

 

This contract contains the
entire and only agreement between us and supersedes all previous agreements
between you and the Company, including without limitation the Contract of
Employment dated 21st August 2006; provided, however, except as
expressly amended in clause 16.8, nothing in this contract amends or supersedes
the Management Equity Award Agreements between you and TDS Investor (Cayman)
L.P.

 

24.          Changes to your  Contract

 

24.1.        The
Company reserves the right to make reasonable changes to any of your terms and
conditions of employment.

 

24.2.        If
the Company changes any of the terms and conditions of your employment it will
notify you in writing at least one month in advance of the changes taking
effect.

 

25.          Meaning of words used

 

In this contract “Group”
means the Company any holding company of the Company for the time being and any
subsidiary (as defined in Section 736 of the Companies Act 1985) for the
time being of the Company or its holding companies (including without
limitation Travelport Limited) and “Group Company” means any company in the
Group.

 

26.          Definitions

 

In
this agreement the following definitions apply:

 

“Agent” means all
and any travel agents and any other person, firm, company or organisation
materially engaged in the business of travel agency with whom you have had
contact or about whom you became aware of or informed in the course of your
employment:

 

(a)   who shall at the Termination Date be negotiating
with a Group Company to be involved in the supply of Restricted Products or
Restricted Services; or

 

19

 

(b)   who has at any time during the period of twelve
months prior to the Termination Date been involved in the supply of Restricted
Products or Restricted Services to a Group Company.

 

“Associated
Company” means any company 20 per cent or more of the equity share capital of
which is owned directly or indirectly by the Company (applying the provisions
of section 838 of the Income and Corporation Taxes Act 1988 in the
determination of ownership), or any other Group Company or any company to which
the Company (or any other Group Company) renders managerial, administrative or
technical services;

 

“Businesses”
means all and any trades or other commercial activities of any Group Company:

 

(a)           with
which you shall have been concerned or involved to any material extent at any
time during the period of twelve months prior to the Termination Date and which
the relevant Group Company shall carry on with a view to profit; or:

 

(b)           which
the relevant Group Company shall at the Termination Date have determined to
carry on with a view to profit in the immediate or foreseeable future and in
relation to which you shall at the Termination Date possess any Confidential
Business information;

 

“Client” means
any person, firm, company or organisation with whom you had contact or about
whom you became aware of or informed in the course of your employment:

 

(a)           who
shall at the Termination Date be negotiating with a Group Company for the
supply of any Restricted Products or the provision of any Restricted Services;
or

 

(b)           to
whom a Group Company shall at any time during the period of twelve months prior
to the Termination Date have supplied any Restricted Products or provided any
Restricted Services;

 

“Confidential Business Information” means all and any Corporate
Information, Marketing Information, Technical Information and other information
(whether or not recorded in documentary form or on computer disk or tape) which
is of a commercially sensitive or confidential nature and any information in
respect of which the Company owes an obligation of confidentiality to any third
party:-

 

(a)           which
you have acquired at any time during your employment by the Company but which
does not form part of your own stock in trade; and

 

20

 

(b)                                 which is not
readily ascertainable to persons not connected with the Company either at all
or without a significant expenditure of labour, skill or money;

 

“Corporate Information” means all and any information (whether or not
recorded in documentary form or on computer disk or tape) relating to the
business methods,  corporate plans, management systems, finances,
maturing new business opportunities or research and development projects of any
Group Company;  “Distributor” means any person, firm, company or
organisation with whom you had contact or about whom you became aware of or
informed in the course of your employment :

 

(a)                                  who
has pursuant to a contract provided sales and marketing services to a Group
Company in any territory of the world during the period of twelve months prior
to the Termination Date; or

 

(b)                                 who
shall at the Termination Date be negotiating with a Group Company to provide
sales and marketing services to a Group Company in any territory of the world;

 

“Employee”
means:

 

(a)                                  any person who is or was, at any time during the
period of twelve months ending on the Termination Date employed or engaged by a
Group Company in a senior management, senior sales, senior technical or legal
position and who, by reason of such a position, possesses any Confidential
Business Information or is likely to be able to solicit the custom of any
Client or to induce any Client to cease dealing with the relevant Group
Company, were he or she to accept the employment or engagement offered and with
whom you shall have dealt at any time during the period of 12 months prior to
the Termination Date; or

 

(b)                                 any person who is or was, at any time during the
period of twelve months ending on the Termination Date employed or engaged by a
Group Company and who at any time in the six months preceding the Termination
Date reported to you directly or indirectly, and with whom you worked on
anything other than an occasional basis during that six month period;

 

“Group”
means all Group Companies from time to time;

 

“Group
Company” means the Company and any Subsidiary or Holding Company of the Company
and any Subsidiary of that Holding Company (and any Associated Company) from
time to time;

 

“Holding
Company” means a holding company as defined in section 736 of the Companies Act
1985.

 

21

 

“Marketing Information” means all and any information (whether or not
recorded in documentary form or on computer disk or tape) relating to the
marketing or sales of any past, present or future product or service of a Group
Company including, without limitation, sales targets and statistics, market
research reports, sales techniques, price lists, discount structures,
advertising and promotional material, the names,  addresses,
telephone numbers, contact names and identities of clients and potential
clients, commercial, technical contacts of and suppliers and potential
suppliers or consultants to a Group Company, the nature of their business
operations, their requirements for any product or service sold or purchased by
a Group Company and all confidential aspects of their business relationship
with the relevant Group Company;

 

“Material Interest” means:

 

(a)                                  the holding of
any position as director, officer, employee, consultant, partner, principal or
agent;

 

(b)                                 the direct or
indirect control or ownership (whether jointly or alone) of any shares (or any
voting rights attached to them) or debentures save for the ownership for
investment purposes only of not more than 3 per cent of the issued ordinary share
of any company whose shares are listed on any Recognised Investment Exchange
(as defined in section 207 of the Financial Services Act 1986); or

 

(c)                                  the direct or
indirect provision of any financial assistance;

 

“Restricted
Period” means the period of twelve months commencing on the Termination Date
unless the Company shall have exercised its right to place you on “garden
leave” in accordance with clause 16.3 above in which case such period of twelve
months shall be reduced by such period as you have spent on “garden leave”;

 

“Restricted Products” means all and any products of a kind which shall
be dealt in, produced, marketed or sold by a Group Company in the ordinary
course of the Businesses;

 

“Restricted Services” means all and any services of a kind which shall
be provided by a Group Company in the ordinary course of the Businesses;

 

“Subsidiary”
means a subsidiary as defined in section 736 of the Companies Act 1985;

 

“Supplier” means
any person, firm, company or organisation with whom you had contact or about
whom you became aware of or informed in the course of your employment:

 

22

 

(a)                                  who
shall at the Termination Date be negotiating with a Group Company to supply
goods and/or services; or

 

(b)                                 from whom a Group Company shall at any time
during the period of twelve months prior to the Termination Date have obtained
any goods and/ or services;

 

“Technical Information” means all and any trade secrets, source codes,
computer programs, inventions, designs, know-how discoveries, technical
specifications and other technical information (whether or not recorded in
documentary form or on computer disk or tape) relating to the creation,
production or supply of any past, present or future product or service of a
Group Company;

 

“Termination Date” means the date on which your employment hereunder
terminates and references to “following the Termination Date” shall be
construed as from and including such date of termination.

 

27.                               Notices

 

27.1.                     Each
party to this agreement may give any notice or other communication under or in
connection with this agreement by letter or facsimile transmission addressed to
the other party. The address for service for you shall be the address provided
to the Company by you and the address for service for the Company shall be as
set forth in 27.2.4.

 

27.2.                     Any
notice or other communication will be deemed to be served:

 

27.2.1.                      if
personally delivered, at the time of delivery and, in proving service, it shall
be sufficient to produce a receipt for the notice signed by or on behalf of the
addressee;

 

27.2.2.                      if
by letter, at noon on the Business Day after such letter was posted and, in
proving service, it shall be sufficient to prove that the letter was properly
stamped first class addressed and delivered to the postal authorities; and

 

27.2.3.                      if
by facsimile transmission, at the time and on the day of transmission, and, in
proving service, it shall be sufficient to produce a transmission report from
the sender’s facsimile machine indicating that the facsimile was sent in its
entirety to the recipient’s facsimile number.

 

23

 

27.2.4.                      Details
for service of any notice or other communication on the Company are as follows:

 

Eric Bock, General Counsel

c/o Travelport Inc.

405 Lexington Avenue

57th Floor

New York, NY 10174

Fax: (212)915-9169

 

24

 

	
   

  	
  Date

  

Signed on behalf of the Company by:

 

	
  /s/ Gordon Wilson

  	
   

  

Gordon Wilson

Director

President and CEO Travelport GDS

 

Signed on behalf of TDS Investor (Cayman) L.P. with
respect to clauses 16.8 and 16.9  only
by:

TDS Investor (Cayman) G.P. on behalf of TDS Investor
(Cayman) L.P.:

 

	
  NAME: 

  	
  /s/ Gordon Wilson

  	
   

  
	
  TITLE:

  	
  President and CEO, Travelport GDS

  	
   

  

 

 

 

EXECUTED and
DELIVERED as a DEED

 

	
  /s/ Philip
  Emery

  	
   

  

by Philip Emery
in the presence of:

 

 

	
  Witness:

  	
   

  	
   

  
	
  Signature:

  	
  /s/
  Geoff Dadswell

  	
   

  
	
   

  	
   

  	
   

  
	
  Name:

  	
  Geoff
  Dadswell

  	
   

  
	
   

  	
   

  	
   

  
	
  Work Address:

  	
  Axis
  One, Axis Park, 10 Hurricane Way

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Langley,
  Berkshire SL3 8AG United Kingdom

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
  October
  5, 2009

  	
   

  

 

By executing this deed you acknowledge that you
have read this contract of employment. Further, you understand, agree to and
will abide by all the terms and conditions of employment as set out above.

 

25

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