Document:

EXHIBIT 10(viii)

 

 

McCORMICK
& COMPANY, INCORPORATED

DEFERRED COMPENSATION PLAN

Effective January 1, 2000

 

Purpose

 

This Plan is maintained for the purpose of providing
Participants an opportunity to defer compensation that would otherwise be
currently payable to such Participants. 
This Plan is intended to be an unfunded plan maintained primarily for
the purpose of providing deferred compensation for a select group of management
or highly compensated employees within the meaning of Title I of the Employee Income
Retirement Security Act of 1974, as amended.

 

ARTICLE 1

 

Definitions

 

For purposes of this Plan, unless otherwise clearly
apparent from the context, the following phrases or terms shall have the
meanings indicated:

 

1.1           “Account
Balance” shall mean, as of any given date called for under the Plan, the sum of
the following: (i) the balance of the Participant’s Deferral Contribution
Account, and (ii) the balance of the Participant’s Discretionary Contribution
Account, as such accounts have been adjusted to reflect all applicable
Investment Adjustments and all prior withdrawals and distributions, in
accordance with Article 3 of the Plan.

 

1.2           “Base
Annual Salary” shall mean the base annual compensation payable to a Participant
by an Employer for services rendered during a Plan Year, (i) excluding Bonuses,
commissions, director fees and other additional incentives and awards payable
to the Participant, but (ii) before reduction for any Elective Deductions.  With respect to directors of the Company who
are not employees of the Company or any Employer, Base Annual Salary shall mean
the director fees payable to such individuals.

 

1.3           “Beneficiary”
shall mean one or more persons, trusts, estates or other entities, designated
(or deemed designated) by the Participant in accordance with Article 10,
to receive the Participant’s undistributed Vested Account Balance in the event
of the Participant’s death.

 

1.4           “Beneficiary
Designation Form” shall mean the document prescribed by the Committee to be
used by the Participant to designate his Beneficiary for the Plan.

 

1.5           “Benefit
Distribution Date” shall mean the date distribution of the Participant’s Vested
Account Balance is triggered and it shall be deemed to occur as of the date on
which the Participant’s employment terminates for any reason whatsoever,
including but not limited to death or Disability.  If the Participant’s employment terminates due to Retirement, his
Benefit Distribution Date shall be deemed to occur as of the January 1
following such Participant’s Retirement. 
In the event the Benefit Distribution Date is triggered due to:  (i) Termination of Employment, the
Participant’s Vested Account Balance shall be 

 

 

                payable
pursuant to Article 6; (ii) Retirement, the Participant’s Vested Account
Balance shall be payable pursuant to Article 7; (iii) pre-retirement
death, the Participant’s Vested Account Balance shall be payable pursuant to
Article 8; and (iv) a Disability, the Participant’s Vested Account Balance
shall be payable pursuant to Article 9.

 

1.6           “Board”
shall mean the board of directors of the Company.

 

1.7           “Bonus”
shall mean the amounts payable to a Participant during a Plan Year under any
bonus or incentive plan or arrangement sponsored by an Employer, before
reduction for any Elective Deductions, but excluding commissions, stock-related
awards and other non-monetary incentives.

 

1.8           “Change
in Control” shall mean the earliest to occur of the following events:

 

(a)           The
consummation of any transaction or series of transactions as a result of which
any “Person” (as the term person is used for purposes of Section 13(d) or
14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”))
other than an “Excluded Person” (as hereinafter defined) has or obtains
ownership or control, directly or indirectly, of fifty percent (50%) or more of
the combined voting power of all securities of the Company or any successor or
surviving corporation of any merger, consolidation or reorganization involving
the Company (the “Voting Securities”). 
The term “Excluded Person” means any one or more of the following:  (i) the Company or any majority-owned
subsidiary of the Company, (ii) an employee benefit plan (or a trust forming a
part thereof) maintained by (A) the Company or (B) any majority-owned subsidiary
of the Company, (iii) any Person who as of the initial effective date of this
Plan owned or controlled, directly or indirectly, ten percent (10%) or more of
the then outstanding Voting Securities, or any individual, entity or group that
was part of such a Person;

 

(b)           A
merger, consolidation or reorganization involving the Company as a result of
which the holders of Voting Securities immediately before such merger,
consolidation or reorganization do not immediately following such merger,
consolidation or reorganization own or control, directly or indirectly, at
least fifty percent (50%) of the Voting Securities in substantially the same
proportion as their ownership or control of the Voting Securities immediately
before such merger, consolidation or reorganization; or

 

(c)           The
sale or other disposition of all or substantially all of the assets of the
Company to any Person (other than a transfer to a majority-owned subsidiary of
the Company).

 

1.9           “Claimant”
shall mean the person or persons described in Section 15.1 who apply for
benefits or amounts that may be payable under the Plan.

 

1.10         “Code”
shall mean the Internal Revenue Code of 1986, as amended, and the regulations
and other authority issued thereunder by the appropriate governmental
authority.

 

2

 

References to the Code
shall include references to any successor section or provision of the
Code.

 

1.11         “Committee”
shall mean the committee described in Article 13 which shall administer
the Plan.

 

1.12         “Company”
shall mean McCormick & Company, Incorporated, a Maryland corporation, and
any successor or assigns.

 

1.13         “Contributions”
shall collectively refer to any and all Deferral Contributions and
Discretionary Contributions, as such terms have been defined herein.

 

1.14         “Deferral
Contribution” shall mean the aggregate amount of Base Annual Salary or Bonus
deferred by a Participant during a given Plan Year in accordance with the terms
of the Plan and the Participant’s Election Form and credited to the Participant’s
Deferral Contribution Account.  Deferral
Contributions shall be deemed to be made to the Plan by the Participant on the
date the Participant would have received such compensation had it not been
deferred pursuant to the Plan.

 

1.15         “Deferral
Contribution Account” shall mean a Participant’s aggregate Deferral
Contributions, as well as any appreciation (or depreciation) specifically
attributable to such Deferral Contributions due to Investment Adjustments,  reduced to reflect all prior distributions
and withdrawals.  The Deferral
Contribution Account shall be utilized solely as a device for the measurement
of amounts to be paid to the Participant under the Plan.  The Deferral Contribution Account shall not
be, constitute or be treated as an escrow, trust fund, or any other type of
funded account for Code or ERISA purposes, and amounts credited thereto shall
not be considered “plan assets” for ERISA purposes.  The Deferral Contribution Account merely provides a record of the
bookkeeping entries relating to the benefits that the Employer intends to
provide Participant and shall thus reflect a mere unsecured promise to pay such
amounts in the future.

 

1.16         “Disability”
shall mean a period of disability during which a Participant qualifies for
disability benefits under his Employer’s short-term or long-term disability
plan, or, if a Participant does not participate in such a plan, a period of
disability during which the Participant would have qualified for disability
benefits had the Participant been a participant in such a plan, as determined
in the sole discretion of the Committee.

 

1.17         “Disability
Benefit” shall mean the benefit set forth in Article 9.

 

1.18         “Discretionary
Contribution” shall mean the aggregate amounts, if any, credited by the
Employer under the Plan on the Participant’s behalf during a given Plan
Year.  Such Discretionary Contributions
shall be credited to the Participant’s Discretionary Contribution Account as of
the date determined appropriate by the applicable Employer, in its sole discretion.  The amount of any Participant’s
Discretionary Contribution shall be determined by the applicable Employer in
its sole discretion.

 

3

 

1.19         “Discretionary
Contribution Account” shall mean a Participant’s aggregate Discretionary
Contributions, as well as any appreciation (or depreciation) specifically
attributable to such Discretionary Contributions due to Investment Adjustments,
reduced to reflect all prior distributions and withdrawals. The Discretionary
Contribution Account shall be utilized solely as a device for the measurement
of amounts to be paid to the Participant under the Plan.  The Discretionary Contribution Account shall
not be, constitute or be treated as an escrow, trust fund, or any other type of
funded account for Code or ERISA purposes, and amounts credited thereto shall
not be considered “plan assets” for ERISA purposes.  The Discretionary Contribution Account merely provides a record
of the bookkeeping entries relating to the benefits that the Employer intends
to provide Participant and shall thus reflect a mere unsecured promise to pay
such amounts in the future.

 

1.20         “Election
Form” shall mean the document  required by the Committee  to
be submitted by a Participant, on a timely basis, which specifies (i) the
amount of Base Annual Salary and/or Bonus the Participant elects to defer from
a given Plan Year and (ii) the portion (if any) of Deferral Contributions that
shall be distributable upon an Interim Distribution Date rather than the
Benefit Distribution Date.  The Election
Form must be submitted by the immediately preceding September 30th in
order to be deemed timely for the following Plan Year, provided that the
Election Form must be submitted by November 15, 1999 in order to be timely
for the Plan Year beginning January 1, 2000.  An Election Form shall be effective only with respect to (i) Base
Annual Salary earned in the Plan Year to which the Election Form applies and
(ii) Bonuses not payable by the Employer before the first day of such Plan
Year.  If a Participant fails to submit
an Election Form with respect to a Plan Year or fails to submit such form on a
timely basis, the Participant shall not make Deferral Contributions during the
Plan Year nor be entitled to Discretionary Contributions attributable to the
Plan Year.

 

1.21         “Elective
Deductions” shall mean those deductions from a Participant’s Base Annual Salary
or Bonus for amounts voluntarily deferred or contributed by the Participant
pursuant to any qualified or non-qualified deferred compensation plan,
including, without limitation, amounts deferred pursuant to Code Sections 125,
402(e)(3) and 402(h), to the extent that all such amounts would have been
payable to the Participant in cash had there been no such deferral or contribution.

 

1.22         “Employer”
shall mean the Company and/or any of its subsidiaries (now in existence or
hereafter formed or acquired) that (i) have been selected by the Board to
participate in the Plan and (ii) have affirmatively adopted the Plan.

 

1.23         “Enrollment
Forms” shall mean the Participation Agreement, the initial Election Form, the
Retirement Benefit Distribution Form and any other forms or documents which may
be required of a Participant by the Committee, in its sole discretion, prior
to and as a condition of participating in the Plan.

 

1.24         “ERISA”
shall mean the Employee Retirement Income Security Act of 1974, as amended, and
the regulations and other authority issued thereunder by the appropriate

 

4

 

governmental
authority.  References herein to any
section of ERISA shall include references to any successor section or
provision of ERISA.

 

1.25         “Financial
Emergency” shall mean an unanticipated emergency or severe financial hardship
to the Participant resulting from a sudden and unexpected illness or accident
of the Participant or a dependent of the Participant, a loss of the
Participant’s property due to casualty, or such other extraordinary and
unforeseeable circumstances arising as a result of events beyond the control of
the Participant.  The circumstances that
constitute an unforeseeable emergency will be determined by the Committee in
its sole discretion and shall depend upon the facts of each case, provided that
a Financial Emergency shall not be deemed to exist to the extent that such
hardship is or may be relieved;

 

(i)            through
reimbursement or compensation by insurance or otherwise,

(ii)           by
liquidation or the Participant’s assets, to the extent the liquidation of such
assets would not itself cause severe financial hardship, or

(iii)          by cessation of Deferral Contributions under
the Plan, provided that this clause (iii) shall not apply for purposes of
Section 4.1.

 

By way
of example, the need to send a Participant’s child to college or the desire to
purchase a home shall not be considered a Financial Emergency.  As a further example, a Financial Emergency
that may be relieved by cessation of Deferral Contributions shall be considered
to be a Financial Emergency until such time as it is or could be relieved by
cessation of Deferral Contributions or by other means.

 

1.26         “Hypothetical
Investment” shall mean an investment fund or benchmark made available to
Participants by the Committee for purposes of valuing amounts credited under
the Plan.  Hypothetical Investment shall
also mean Common Stock of the Company (“Stock”).

 

1.27         “Interim
Distribution Date” shall mean the first day of any calendar year, selected by
the Participant, upon which the designated portion of Deferral (as well as any
appreciation or depreciation of such amounts due to Investment Adjustments)
attributable to a given Plan Year shall be distributed in a lump sum
payment.  Notwithstanding the prior
sentence, in no event shall a Participant be permitted to select a date that is
less than four (4) years from the date the election is made.

 

1.28         “Investment
Adjustment(s)” shall mean any appreciation credited to (as income or gains) or
depreciation deducted from (as expenses or losses) a Participant’s Deferral
Contribution Account and/or Discretionary Contribution Account, in accordance
with such Participant’s selection of Hypothetical Investments pursuant to the
Participant’s Investment Allocation Form(s) and/or Investment Re-Allocation
Form(s).

 

1.29         “Investment
Allocation Form” (i) shall apply with respect to those Deferral Contributions
and Discretionary Contributions made to the Plan after the effective date of
the Investment Allocation Form but prior to the effective date of a timely
filed subsequent Investment Allocation Form and (ii) shall determine the manner
in which such Deferral

 

5

 

Contributions
and/or Discretionary Contributions shall be initially allocated by the
Participant among the various Hypothetical Investments within the Plan. A new
Investment Allocation Form may be submitted by the Participant in electronic or
telephonic format, at such times as the Committee shall permit, provided that
such new Investment Allocation Form is submitted in a timely manner.  An Investment Allocation Form shall be
deemed timely if submitted in accordance with the procedures and deadlines
established by the Committee.

 

1.30         “Investment
Re-allocation Form” shall re-direct the manner in which earlier Deferral
Contributions and/or Discretionary Contributions, as well as any appreciation
(or depreciation) to-date, are invested within the Hypothetical Investments
(except Stock) available in the Plan.  An Investment Re-Allocation Form may be
submitted by the Participant in electronic or telephonic format, at such times
as the Committee shall permit, with respect to the balance of the (i)
Deferral Contribution Account and/or (ii) Discretionary Contribution Account,
at such time, provided that such Investment Re-Allocation Form is submitted in
a timely manner.  An Investment
Re-Allocation Form shall be deemed timely if submitted in accordance with the
procedures and deadlines established by the Committee.

 

1.31         “Leave
of Absence” shall mean an authorized unpaid leave of absence from employment
with the Company or the Employer.

 

1.32         “Participant”
shall mean any employee or member of the Board (i) who is selected to
participate in the Plan in accordance with Section 2.1, (ii) who elects to
participate in the Plan, (iii) who signs the applicable Enrollment Forms (and
other forms required by the Committee) on a timely basis, and (iv) whose signed
Enrollment Forms (and other required forms) are accepted by the Committee.

 

1.33         “Participation
Agreement” shall mean the separate written agreement entered into by and
between the Employer and the Participant, which shall indicate the
Participant’s intent to defer compensation subject to the terms of the Plan and
the Participation Agreement.

 

1.34         “Plan”
shall mean the McCormick & Company, Incorporated Deferred Compensation
Plan, which shall be evidenced by this instrument, each Participation Agreement
and each Enrollment Form, as they may be amended from time to time.

 

1.35         “Plan
Year” shall mean the initial period beginning on January 1, 2000 and
ending on December 31, 2000. 
Thereafter, the term “Plan Year” shall mean the period beginning on
January 1 of each year and ending December 31.  Accordingly, Plan quarters shall commence on
January 1, April 1, July 1 and October 1 of each year.

 

1.36         “Retirement,”
“Retires” or “Retired” shall mean, with respect to an Employee, severance from
employment from any and all Employers for any reason other than an authorized
leave of absence, Disability, death or for cause termination on or after the
earlier of the attainment of (i) age sixty-five (65) or (ii) age fifty-five
(55) and at least one (1) year of service.  Solely
for the purposes of this Section 1.36, the term “Employers” shall include

 

6

 

all subsidiaries and
other affiliates of the Company as determined by the Committee in its sole
discretion.

 

1.37         “Retirement
Benefit” shall mean the benefit set forth in Article 7.

 

1.38         “Retirement
Benefit Distribution Form” shall mean the document, executed by the
Participant, which specifies the manner in which the Participant shall have the
balance of his accounts distributed in the event his Benefit Distribution Date
is triggered due to such Participant’s Retirement from the Employers.  The Participant shall elect to receive the
Retirement Benefit in a lump sum or in substantially equal annual payments over
a period of 5, 10, 15 or 20 years.  The
Retirement Benefit Distribution Form must be provided to the Committee along
with all other Enrollment Forms, pursuant to Article 2, prior to
participating in the Plan. Notwithstanding the preceding provisions of this
Section, the Participant may submit a subsequent Retirement Benefit
Distribution Form in order to change the form of distribution, provided that
such form shall be effective only if (i) it is submitted at least thirteen (13)
months prior the Participant’s actual Benefit Distribution Date and (ii)
it is approved by the Committee, in its sole discretion.

 

1.39         “Termination
Benefit” shall mean the benefit set forth in Article 6.

 

1.40         “Termination
of Employment” shall mean the voluntary or involuntary severing of employment,
with any and all Employers, for any reason other than an authorized leave of
absence, Retirement, Disability, or death. Solely for the purposes of this
Section 1.40, the term “Employers” shall include all subsidiaries and
other affiliates of the Company as determined by the Committee in its sole
discretion.

 

1.41         “Trust”
shall mean a grantor trust of the type commonly referred to as a “rabbi trust”
created to hold assets to be used to provide benefits under the Plan.

 

1.42         “Vested
Account Balance” shall mean, as of any given measurement date called for under
the Plan, the sum of the following:  (i)
the balance of the Participant’s Deferral Contribution Account and (ii) the
balance of the Participant’s Discretionary Contribution Account, as such
accounts have been adjusted to reflect all applicable Investment Adjustments
and all prior withdrawals and distributions, in accordance with Article 3
of the Plan and the Participation Agreement.

 

1.43         “Years
of Service” shall mean the total number of twelve (12) month periods during
which a Participant has been continuously employed by one or more Employers.

 

ARTICLE 2

 

Eligibility,
Selection, Enrollment

 

2.1           Eligibility,
Selection by Committee.  Those
employees of an Employer who are in Grade 15 or above or non-employee members
of the Board who are (i) in the case of an

 

7

 

employee,
determined by the Company (or Employer, as applicable) to be includable in a
select group of management or highly compensated employees of the applicable
Employer, (ii) specifically chosen by the applicable Employer to participate in
the Plan, and (iii) approved for such participation by the Committee, in its
sole discretion, shall be eligible to participate in the Plan subject to the
enrollment requirements described in Section 2.2.  As used herein, the term “employee” shall
include a member of the Board who is not employed by the Company.

 

2.2           Enrollment
Requirements. Each employee deemed eligible to participate in the Plan
pursuant to Section 2.1, shall, as a condition to participating in the
Plan,  complete and return to the
Committee all of the required Enrollment Forms, on a timely basis.  In addition, the Committee shall in its sole
discretion, establish such other enrollment requirements necessary for
continued participation in the Plan.

 

2.3           Commencement
of Participants.  If a Participant
has met all enrollment requirements set forth in this Plan and required by the
Committee, including returning the Enrollment Forms and other required
documents to the Committee within the specified time period, the Participant’s
participation shall commence as of the date established by the Committee in its
sole discretion.  If a Participant fails
to meet all such requirements within the specified time period with respect to
any Plan Year, the Participant shall not be eligible to participate during that
Plan Year.

 

ARTICLE 3

 

Deferral Contributions, Discretionary
Contributions

Investment Adjustments, Taxes and
Vesting

 

3.1           Deferral
Contributions.

 

(a)           Election
to Defer.  A Participant may elect
to defer the receipt of amounts payable to the Participant, in the form of Base
Annual Salary and/or Bonus, during any Plan Year.  The Participant’s intent to defer shall be evidenced by a
Participation Agreement and annual Election Form, both completed and submitted
to the Committee in accordance with such procedures and time frames as may be
established by the Committee in its sole discretion.  Amounts deferred by a Participant with respect to a given Plan
Year shall be referred to collectively as Deferral Contributions and shall be
credited to a Deferral Contribution Account established in the name of the
Participant.

 

(b)           Components
of Deferral Contributions.

 

(i)            Base
Annual Salary.  A Participant may
designate a percentage to be deducted from his Base Annual Salary.  Such amount shall be deducted in
substantially equal installments, from each regularly scheduled payment of Base
Annual Salary.

 

8

 

(ii)           Bonus.  A Participant may designate a fixed dollar
amount, a percentage, or a percentage above a fixed dollar amount to be
deducted from his Bonus. If a fixed dollar amount is designated by the
Participant to be deducted from any Bonus payment and such fixed dollar amount
exceeds the Bonus actually payable to the Participant, the entire amount of
such Bonus shall be deducted.

 

(iii)          Directors’ Fees.  A Participant may designate a percentage to
be deducted from his directors’ fees. 
Such amounts shall be deducted in substantially equal installment, from
each regularly scheduled payment of directors’ fees.

 

(c)           Minimum
Deferral.  For any Plan Year, the
Committee may permit a Participant to elect to defer, pursuant to an Election
Form, one or more of the following forms of compensation in the following
minimum percentages:

 

	
  Deferral

  	
   

  	
  Minimum

  Percentage

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Base
  Annual Salary

  	
   

  	
  10

  	
  %

  
	
  Bonus

  	
   

  	
  10

  	
  %

  
	
  Directors’
  Fees

  	
   

  	
  10

  	
  %

  

 

If an Election Form is
submitted which would yield less than the stated minimum amounts, the amount
deferred shall be zero.

 

(d)           Maximum
Deferral.  For any given Plan Year
the Committee may permit a Participant to defer, pursuant to an Election Form,
one or more of the following forms of compensation up to the following maximum
percentages:

 

	
  Deferral

  	
   

  	
  Maximum

  Percentage

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Base
  Annual Salary

  	
   

  	
  80

  	
  %

  
	
  Bonus

  	
   

  	
  90

  	
  %

  
	
  Directors’
  Fees

  	
   

  	
  100

  	
  %

  

 

3.2           Selection
of Hypothetical Investments.  The
Participant shall, via his Investment Allocation Form(s), as more fully
described in Section 1.29, and his Investment Re-Allocation Form(s), as
more fully described in Section 1.30, select one or more Hypothetical
Investments among which his various contributions shall be distributed.  At the beginning of each Plan Year, the
Committee shall provide the Participant with a list of Hypothetical Investments
available. From time to time, in the sole discretion of the Committee, the
Hypothetical Investments available within the Plan may be revised. All
Hypothetical Investment selections must be denominated in whole percentages
unless the Committee determines that lower increments are acceptable.  A Participant may make

 

9

 

changes in his
selected Hypothetical Investments (except Stock) on a daily basis via
submission of a new Investment Allocation Form, as described in and subject to
the language of Section 1.29 or submission of a new Investment
Re-Allocation Form, as described in and subject to the language of
Section 1.30.  Once a Participant
makes an allocation with respect to Stock, the Participant may not either
increase or decrease the percentage allocated to Stock.

 

3.3           Discretionary
Contributions.  A Participant may be
credited with Discretionary Contributions for any Plan Year in which such
amounts are declared by the applicable Employer with respect to the
Participant. Such Discretionary Contributions shall be credited to a
Discretionary Contribution Account in the name of the Participant. The
applicable Employer shall have sole discretion to determine with respect to
each Plan Year and each Participant  (i)
whether any Discretionary Contribution was declared with respect to the
Participant and (ii) the amount of such Discretionary Contribution.

 

3.4           Adjustment
of Participant Accounts.  While a
Participant’s accounts do not represent the Participant’s ownership of, or any
ownership interest in, any particular assets, the Participant’s accounts shall
be adjusted in accordance with the Hypothetical Investment(s) chosen by the
Participant on his (i) Investment Allocation Form or (ii) Investment
Re-Allocation Form, subject to the conditions and procedures set forth herein
or established by the Committee from time to time.  Any cash earnings generated under a Hypothetical Investment (such
as hypothetical interest and cash dividends) shall, at the Committee’s sole
discretion, either be deemed to be reinvested in that Hypothetical Investment
or reinvested in one or more other Hypothetical Investment(s) designated by the
Committee.  All notional acquisitions
and dispositions of Hypothetical Investments that occur within a Participant’s
accounts, pursuant to the terms of the Plan, shall be deemed to occur at such
times as the Committee shall determine to be administratively feasible in its
sole discretion and the Participant’s accounts shall be adjusted
accordingly.  Accordingly, if a
distribution or re-allocation must occur pursuant to the terms of the Plan and
all or some portion of the Account Balance must be valued in connection such
distribution or re-allocation (to reflect Investment Adjustments), the
Committee may in its sole discretion, unless otherwise provided for in the
Plan, select a date or dates that shall be used for valuation purposes.  Notwithstanding anything to the contrary,
any Investment Adjustments made to any Participants’ accounts following a
Change in Control shall be made in a manner no less favorable to Participants
than the practices and procedures employed under the Plan, or as otherwise in
effect, as of the date of the Change in Control.

 

3.5           Withholding
of Taxes.

 

(a)           Annual
Withholding from Compensation.  For
any Plan Year in which Deferral Contributions are credited under the Plan, the
Employer shall withhold the Participant’s share of FICA and other employment
taxes from the portion of the Participant’s Base Annual Salary and/or Bonus not
deferred.  If deemed appropriate by the
Committee, the Committee may reduce the amount deferred 

 

10

 

pursuant to the
Participant’s Election Form where necessary to facilitate compliance with
applicable withholding requirements.

 

(b)           Withholding
from Benefit Distributions.  The
Participant’s Employer (or the trustee of the Trust, as applicable), shall
withhold from any payments made to a Participant under this Plan all federal,
state and local income, employment and other taxes required to be withheld by
the Employer (or the trustee of the Trust, as applicable), in connection with
such payments, in amounts and in a manner to be determined in the sole
discretion of the Employer (or the trustee of the Trust, as applicable).

 

3.6           Vesting.  The Participant shall at all times be one
hundred percent (100%) vested in all Deferral Contributions and Discretionary
Contributions adjusted to reflect any appreciation (or depreciation)
specifically attributable to such contributions due to Investment Adjustments.

 

ARTICLE 4

 

Suspension of Deferrals

 

4.1           Financial
Emergencies.  If a Participant
experiences a Financial Emergency, the Participant may petition the Committee
to suspend any deferrals required to be made by the Participant pursuant to his
current Election Form.  The Committee
shall determine, in its sole discretion, whether to approve the Participant’s
petition.  If the petition for a
suspension is approved, suspension shall commence upon the date of approval and
shall continue until the earlier of (i) the end of the Plan Year or (ii) the
date the Financial Emergency ceases to exist, as determined by the Committee in
its sole discretion.  The Participant’s
eligibility for Discretionary Contributions shall be similarly suspended.

 

4.2           Disability.  From and after the date that a Participant
is deemed to have suffered a Disability, any current Election Form of the
Participant shall automatically be suspended, and no further deferrals shall be
required to be made by the Participant pursuant to his current Election Form.
The Participant’s eligibility for Discretionary Contributions shall be
similarly suspended.

 

4.3           Leave
of Absence.  If a Participant is
authorized by the Participant’s Employer for any reason to take a Leave of
Absence, the Participant’s deferrals shall be suspended (as well as his
eligibility for Discretionary Contributions) until the earlier of the date the
Leave of Absence expires or the Participant returns to a paid employment
status.  Upon such expiration or return,
deferrals shall resume (as will eligibility for Discretionary Contributions)
for the remaining portion of the Plan Year in which the expiration or return
occurs, based on the Election Form, if any, made for that Plan Year.  If no election was made for that Plan Year,
no deferral shall be withheld.  If a
Participant is authorized by the Participant’s Employer for any reason to take
a paid leave of absence from the employment of the Employer, the
Participant shall continue to be considered employed

 

11

 

by the Employer
and the appropriate amounts shall continue to be withheld from the
Participant’s compensation pursuant to the Participant’s then current Election
Form.

 

ARTICLE 5

 

Interim and Hardship Distributions

 

5.1           Interim
Distributions.  A Participant may
make an advance election, at the time he files any Election Form for a given
Plan Year, to have certain amounts (except Stock) payable from his Deferral
Contribution Account at an Interim Distribution Date designated by the
Participant, instead of payable at the Participant’s Benefit Distribution Date.  Such amount(s) shall be measured on the
applicable Interim Distribution Date and shall be payable within thirty (30)
days of such Interim Distribution Date. 
The Participant’s selection of an Interim Distribution Date must comply
with Section 1.27.  Notwithstanding
a Participant’s advance election of an Interim Distribution Date or Dates, the
amounts that would otherwise be subject to such Interim Distribution Date or
Dates shall be distributable upon the Participant’s Benefit Distribution Date
(pursuant to Article 6, 7, 8 or 9 as applicable), if such date occurs
prior to any Interim Distribution Date.

 

5.2           Withdrawal
in the Event of a Financial Emergency. 
A Participant who believes he has experienced a Financial Emergency may
request in writing a withdrawal of a portion of his accounts (except Stock)
necessary to satisfy the emergency.  The
Committee shall determine, in its sole discretion, (i) whether a Financial
Emergency has occurred, (ii) the amount reasonably required to satisfy the Financial
Emergency as well as (iii) the accounts from which the withdrawal shall be
made.  If, subject to the sole
discretion of the Committee, the petition for a withdrawal is approved, the
distribution shall be made within thirty (30) days of the date of approval by
the Committee.

 

ARTICLE 6

 

Termination Benefit

 

6.1           Termination
Benefit.  If the Participant’s
Benefit Distribution Date is triggered due to his Termination of Employment,
the Participant shall receive a Termination Benefit and no other benefits shall
be payable under the Plan.

 

6.2           Payment
of Termination Benefit.  The
Termination Benefit shall be a lump sum payment equal to the Participant’s
Vested Account Balance and shall be made no later than thirty (30) days after
the occurrence of the Participant’s Benefit Distribution Date.

 

6.3           Death
Prior to Payment of Termination Benefit. 
If a Participant dies after his Termination of Employment but before the
Termination Benefit is paid to him, the Participant’s unpaid Termination
Benefit shall be paid to the Participant’s Beneficiary within thirty (30) days
of the date of the Participant’s death and the receipt by the

 

12

 

Committee of all
documents and information deemed by the Committee to be necessary to make the
payment.

 

ARTICLE 7

 

Retirement Benefit

 

7.1           Retirement
Benefit.  If the Participant’s
Benefit Distribution Date is triggered due to his Retirement, the Participant
shall receive the Retirement Benefit and no other benefit shall be payable
under the Plan.

 

7.2           Payment
of Retirement Benefit.  The
Retirement Benefit shall be payable in the form previously selected by the
Participant, pursuant to his Retirement Benefit Distribution Form, and shall
commence (or be fully paid, in the event a lump-sum form of distribution was
selected) no later than thirty (30) days after the Participant’s Benefit
Distribution Date. If the Retirement Benefit is paid in installments, the
initial installment shall be based on the value of the Participant’s Account
Balance, measured on his Benefit Distribution Date and shall be equal to 1/n
(where ‘n’ is equal to the total number of annual benefit payments not yet
distributed).  Subsequent installment
payments shall be computed in a consistent fashion, with the measurement date
being the anniversary of the original measurement date.

 

7.3           Death
Prior to Completion of Retirement Benefit.

 

If a Participant dies
after Retirement but before the Retirement Benefit has commenced or been paid
in full, the Participant’s unpaid Retirement Benefit payments shall be paid to
the Participant’s Beneficiary in a lump sum, equal to the Participant’s
remaining Vested Account Balance.  Such
lump-sum payment shall be made within thirty (30) days of the date of the
Participant’s death and the receipt by the Committee of all documents and
information deemed by the Committee to be necessary to make the payment.

 

ARTICLE 8

 

Pre-Retirement Death Benefit

 

8.1           Pre-Retirement
Death Benefit. If the Participant’s Benefit Distribution Date is triggered
due to his death during employment, the Participant’s Beneficiary shall receive
the pre-retirement death benefit described below and no other benefits shall be
payable under the Plan.

 

8.2           Payment
of Pre-Retirement Death Benefit. 
The pre-retirement death benefit shall be a lump-sum payment equal to
the Participant’s Vested Account Balance and shall be made no later than thirty
(30) days after the occurrence of the Participant’s Benefit Distribution Date
and the receipt by the Committee of all documents and information deemed
necessary to make the payments.

 

13

 

ARTICLE 9

 

Disability
Benefit

 

9.1           Disability
Benefit.  A Participant suffering a
Disability that is found to be total and permanent shall receive a Disability
Benefit equal to his Vested Account Balance. 
Subject to Article 5, the Disability Benefit shall be paid in a
lump sum within thirty (30) days of the Committee’s determination of such
Disability, provided, however, that should the Participant otherwise have been
eligible to Retire, he or she shall be paid a Retirement Benefit in accordance
with Article 7.

 

ARTICLE 10

 

Change in Control Benefit

 

10.1         Change
in Control Benefit.  A Participant
may elect that upon a Change in Control occurring in the future, the
Participant will have his Vested Account Balance paid to him.  In order for such election to be valid, it
must be received in the form prescribed by the Committee not less than thirteen
(13) months prior to the date of the Change in Control.  Payment of the Vested Account Balance shall
be made in a lump sum and shall be made no later than thirty (30) days after
the Change in Control.

 

ARTICLE 11

 

Beneficiary Designation

 

11.1         Beneficiary.  Each Participant shall have the right, at
any time, to designate a Beneficiary or Beneficiaries to receive, in the event
of the Participant’s death, those benefits payable under the Plan.  The Beneficiary(ies) designated under this
Plan may be the same as or different from the Beneficiary designation made
under any other plan of the Employer.

 

11.2         Beneficiary
Designation; Change; Spousal Consent. 
A Participant shall designate his Beneficiary by completing and signing
a Beneficiary Designation Form, and returning it to the Committee or its
designated agent.  A Participant shall
have the right to change his Beneficiary by completing, signing and submitting
to the Committee a revised Beneficiary Designation Form in accordance with the
Committee’s rules and procedures, as in effect from time to time.  If
the Participant names someone other than his spouse as a Beneficiary, a spousal
consent, in the form designated by the Committee, must be signed by that
Participant’s spouse and returned to the Committee.  Upon acknowledgement by the Committee of a revised Beneficiary
Designation Form, all Beneficiary designations previously filed shall be deemed
canceled.  The Committee shall be
entitled to rely on the last Beneficiary Designation Form both (i) filed by the
Participant and (ii) acknowledged by the Committee, prior to his death.

 

14

 

11.3         Acknowledgment.  No designation or change in designation of a
Beneficiary shall be effective until received, accepted and acknowledged in
writing by the Committee or its designated agent.

 

11.4         No
Beneficiary Designation.  If a
Participant fails to designate a Beneficiary as provided above or, if all
designated Beneficiaries predecease the Participant or die prior to complete
distribution of the Participant’s benefits, then the Participant’s designated
Beneficiary shall be deemed to be his surviving spouse.  If the Participant has no surviving spouse,
the benefits remaining under the Plan shall be payable to the personal
representative of the Participant.

 

11.5         Doubt
as to Beneficiary.  If the Committee
has any doubt as to the proper Beneficiary to receive payments pursuant to this
Plan, the Committee shall have the right, exercisable in its discretion, to
cause the Participant’s Employer (or, if applicable, the trustee of the Trust)
to withhold such payments until this matter is resolved to the Committee’s
satisfaction.

 

11.6         Discharge
of Obligations.  The payment of
benefits under the Plan to a Beneficiary shall fully and completely discharge
all Employers and the Committee from all further obligations under this Plan
with respect to the Participant, and the Participant’s Participation Agreement
shall terminate upon such full payment of benefits.

 

ARTICLE 12

 

Termination, Amendment or
Modification

 

12.1         Termination.  Although the Employers anticipate that they
will continue the Plan for an indefinite period of time, there is no guarantee
that any Employer will continue the Plan or will not terminate the Plan at any
time in the future.  Accordingly, each
Employer reserves the right to discontinue its sponsorship of the Plan and to terminate
the Plan, at any time, with respect to its participating employees by action of
its board of directors.  Upon the
termination of the Plan with respect to any Employer, the Vested Account of
each affected Participant shall be paid to the Participant or, in the case of
the Participant’s death, to the Participant’s Beneficiary, in a lump sum
notwithstanding any elections made by the Participant, and the Participation
Agreements relating to each of the Participant’s accounts shall terminate upon
full payment of such Vested Account Balance.

 

12.2         Amendment.  The Company may, at any time, amend or
modify the Plan in whole or in part with respect to any or all Employers;
provided that (i) no amendment or modification shall decrease or restrict the
value of a Participant’s Vested Account Balance in existence at the time the
amendment or modification is made, calculated as if the Participant had
experienced a Termination of Employment as of the effective date of the
amendment or modification, or, if the amendment or modification occurs after
the date upon which the Participant was eligible to Retire, calculated
as if the Participant had Retired as of the effective date of the amendment or
modification, and (ii) except as specifically provided in Section 11.1, after
a Change in Control, no amendment or modification shall adversely

 

15

 

affect the
vesting, calculation or payment of benefits hereunder to any Participant or
Beneficiary or diminish any other rights or protections any Participant or
Beneficiary would have had, but for such amendment or modification, unless such
affected Participant or Beneficiary consents in writing to such amendment.

 

12.3         Effect
of Payment.  The full payment of the
applicable benefit under the provisions of the Plan shall completely discharge
all obligations to a Participant and his Beneficiaries under this Plan and each
of the Participant’s Participation Agreement shall terminate.

 

ARTICLE 13

 

Administration

 

13.1         Committee
Duties.  This Plan shall be
administered by a Committee which shall consist of the Board, or such committee
as the Board shall appoint.  Members of
the Committee may be Participants in this Plan.  The Committee shall also have the discretion and authority to (i)
make, amend, interpret, and enforce all appropriate rules and regulations for
the administration of this Plan and (ii) decide or resolve any and all
questions including interpretations of this Plan, as may arise in connection
with the Plan.  Any individual serving
on the Committee who is a Participant shall not vote or act on any matter
relating solely to himself or herself. 
When making a determination or calculation, the Committee shall be
entitled to rely on information furnished by Participant or an Employer.

 

13.2         Agents.  In the administration of this Plan, the
Committee may, from time to time, employ agents and delegate to them such
administrative duties as it sees fit (including acting through a duly appointed
representative) and may from time to time consult with counsel who may be
counsel to any Employer.

 

13.3         Binding
Effect of Decisions.  The decision
or action of the Committee with respect to any question arising out of or in
connection with the administration, interpretation and application of the Plan
and the rules and regulations promulgated by the Committee hereunder shall be
final and conclusive and binding upon all persons having any interest in the
Plan.

 

13.4         Indemnity
of Committee.  All Employers shall
indemnify and hold harmless the members of the Committee, and any Employee to
whom duties of the Committee may be delegated, against any and all claims,
losses, damages, expenses or liabilities arising from any action or failure to
act with respect to this Plan, except in case of willful misconduct by the
Committee or any of its members or any such employee.

 

13.5         Employer
Information.  To enable the
Committee to perform its functions, each Employer shall supply full and timely
information to the Committee on all matters relating to the compensation of its
Participants, the date and circumstances of the

 

16

 

Retirement,
Disability, death or Termination of Employment of its Participants, and such
other pertinent information as the Committee may reasonably require.

 

ARTICLE 14

 

Other Benefits and Agreements

 

The benefits provided for a Participant and
Participant’s Beneficiary under the Plan are in addition to any other benefits
available to such Participant under any other plan or program for employees of
the Participant’s Employer.  The Plan
shall supplement and shall not supersede, modify or amend any other such plan
or programs except as may otherwise be expressly provided.

 

ARTICLE 15

 

Claims
Procedures

 

15.1         Presentation
of Claim.  Any Participant or
Beneficiary of a deceased Participant (such Participant or Beneficiary being
referred to below as a “Claimant”) may deliver to the Committee a written claim
for a determination with respect to the amounts distributable to such Claimant
from the Plan.  If such a claim relates
to the contents of a notice received by the Claimant, the claim must be made
within thirty (30) days after such notice was received by the Claimant.  The claim must state with particularity the
determination desired by the Claimant. 
All other claims must be made within one hundred eighty (180) days of
the date on which the event that caused the claim to arise occurred.  The claim must state with particularity the
determination desired by the Claimant.

 

15.2         Notification
of Decision.  The Committee shall
consider a Claimant’s claim within a reasonable time, and shall notify the
Claimant in writing:

 

(a)           that
the Claimant’s requested determination has been made, and that the claim has
been allowed in full; or

 

(b)           that the Committee has
reached a conclusion contrary, in whole or in part, to the Claimant’s requested
determination, and in that event, such notice shall set forth in a manner
calculated to be understood by the Claimant:

 

(i)                                     the
specific reason(s) for the denial of the claim, or any part of it;

 

(ii)                                  specific
reference(s) to pertinent provisions of the Plan upon which such denial was
based;

 

(iii)                               a description of any
additional material or information necessary for the Claimant to perfect the
claim, and an explanation of why such material or information is necessary; and

 

17

 

(iv)                              an
explanation of the claim review procedure set forth in Section 15.3 below.

 

15.3         Review
of a Denied Claim.  Within sixty
(60) days after receiving a notice from the Committee that a claim has been
denied, in whole or in part, a Claimant (or the Claimant’s duly authorized
representative) may file with the Committee a written request for a review of
the denial of the claim.  Thereafter,
but not later than thirty (30) days after the review procedure began, the
Claimant (or the Claimant’s duly authorized representative):

 

(a)           may review pertinent
documents;

 

(b)           may submit written
comments or other documents; and/or

 

(c)           may
request a hearing, which the Committee, in its sole discretion, may grant.

 

15.4         Decision
on Review.  The Committee shall
render its decision on review promptly, and not later than sixty (60) days
after the filing of a written request for review of the denial, unless a
hearing is held or other special circumstances require additional time, in
which case the Committee’s decision must be rendered within one hundred twenty
(120) days after such date.  Such
decision must be written in a manner calculated to be understood by the
Claimant, and it must contain:

 

(a)           specific reasons for
the decision;

 

(b)           specific reference(s)
to the pertinent Plan provisions upon which the decision was based; and

 

(c)           such other matters as
the Committee deems relevant.

 

ARTICLE 16

 

Trust

 

16.1         Establishment
of the Trust.  The Company may
utilize one or more Trusts to which the Employers may transfer such assets as
the Employers determine in their sole discretion to assist in meeting their
obligations under the Plan.

 

16.2         Interrelationship
of the Plan and the Trust.  The
provisions of the Plan and the Participation Agreement shall govern the rights
of a Participant to receive distributions pursuant to the Plan.  The provisions of the Trust shall govern the
rights of the Employers, Participants and the creditors of the Employers to the
assets transferred to the Trust.

 

18

 

16.3         Distributions
From the Trust.  Each Employer’s
obligations under the Plan may be satisfied with Trust assets distributed
pursuant to the terms of the Trust, and any such distribution shall reduce the
Employer’s obligations under this Agreement.

 

 

ARTICLE 17

 

Miscellaneous

 

17.1         Status
of Plan.  The Plan is intended to be
a plan that is not qualified within the meaning of Code Section 401(a) and
that “is unfunded and is maintained by an employer primarily for the purpose of
providing deferred compensation for a select group of management or highly
compensated employees” within the meaning of ERISA.  The Plan shall be administered and interpreted to the extent
possible in a manner consistent with that intent.  All Participant accounts and all credits and other adjustments to
such Participant accounts shall be bookkeeping entries only and shall be
utilized solely as a device for the measurement and determination of amounts to
be paid under the Plan.  No Participant
accounts, credits or other adjustments under the Plan shall be interpreted as
an indication that any benefits under the Plan are in any way funded.

 

17.2         Unsecured
General Creditor.  Participants and
their Beneficiaries, heirs, successors and assigns shall have no legal or
equitable rights, interests or claims in any property or assets of an
Employer.  For purposes of the payment
of benefits under this Plan, any and all of an Employer’s assets, shall be, and
shall remain, the general, unpledged unrestricted assets of the Employer.  Any Employer’s obligation under the Plan
shall be merely that of an unfunded and unsecured promise to pay money in the
future.

 

17.3         Employer’s
Liability.  An Employer’s liability
for the payment of benefits shall be defined only by the Plan and the
Participation Agreement, as entered into between the Employer and a
Participant.  An Employer shall have no
obligation to a Participant under the Plan except as expressly provided in the
Plan and his Participation Agreement.

 

17.4         Nonassignability.  Neither a Participant nor any other person
shall have any right to commute, sell, assign, transfer, pledge, anticipate,
mortgage or otherwise encumber, transfer, hypothecate, alienate or convey in
actual receipt, the amount, if any, payable hereunder, or any part thereof,
which are, and all rights to which are expressly declared to be, unassignable
and non-transferable.  Except as required
by law, no part of the amounts payable shall, prior to actual payment, be
subject to seizure, attachment, garnishment or sequestration for the payment of
any debts, judgments, alimony or separate maintenance owed by a Participant or
any other person, be transferable by operation of law in the event of a
Participant’s or any other person’s bankruptcy or insolvency.

 

17.5         Not
a Contract of Employment.  The terms
and conditions of this Plan and the Participation Agreement shall not be deemed
to constitute a contract of employment between any Employer and the
Participant.  Such employment is hereby
acknowledged to

 

19

 

be an “at will”
employment relationship that can be terminated at any time for any reason, or
no reason, with or without cause, and with or without notice, except as
otherwise provided in a written employment agreement.  Nothing in this Plan or any Participation Agreement shall be
deemed to give a Participant the right to be retained in the service of any
Employer as an employee or to interfere with the right of any Employer to
discipline or discharge the Participant at any time.

 

17.6         Furnishing
Information.  Each Participant and
Beneficiary shall cooperate with the Committee by furnishing any and all
information requested by the Committee and take such other actions as may be
requested in order to facilitate the administration of the Plan and the
payments of benefits hereunder, including but not limited to taking such
physical examinations as the Committee may deem necessary.

 

17.7         Terms.  Whenever any words are used herein in the
masculine, they shall be construed as though they were in the feminine in all
cases where they would so apply; and whenever any words are used herein in the
singular or in the plural, they shall be construed as though they were used in
the plural or the singular, as the case may be, in all cases where they would
so apply.

 

17.8         Captions.  The captions of the articles, sections or
paragraphs of this Plan are for convenience only and shall not control or
affect the meaning or construction of any of its provisions.

 

17.9         Governing
Law. The provisions of this Plan shall be construed and interpreted
according to ERISA and the internal laws of the State of Maryland without
regard to its conflicts of laws principles, to the extent not preempted by
ERISA.

 

17.10       Notice. 
Any notice or filing required or permitted to be given to the Committee
under this Plan shall be sufficient if in writing and hand-delivered, or sent
by registered or certified mail, to the address below:

 

McCormick &
Company, Incorporated

18 Loveton Circle

Sparks, Maryland 21152

Attn:  Vice President – Human Relations

 

Such notice shall be
deemed given as of the date of delivery or, if delivery is made by mail, as of
the date shown on the postmark or the receipt for registration or
certification.

 

Any notice or filing
required or permitted to be given to a Participant under this Plan shall be
sufficient if in writing and hand-delivered, or sent by mail, to the last known
address of the Participant.

 

17.11       Successors.  The provisions of this Plan shall bind and inure to the benefit
of the Participant’s Employer and its successors and assigns, the Participant,
the Participant’s Beneficiaries and their successors and assigns.

 

20

 

17.12       Validity.  In case any provision of this Plan shall be illegal or invalid
for any reason, said illegality or invalidity shall not affect the remaining
parts hereof, but this Plan shall be construed and enforced as if such illegal
or invalid provision had never been inserted herein.

 

17.13       Incompetent.  If the Committee determines in its discretion that a benefit
under this Plan is to be paid to a minor, a person declared incompetent or to a
person incapable of handling the disposition of that person’s property, the
Committee may direct payment of such benefit to the guardian, legal
representative or person having the care and custody of such minor, incompetent
or incapable person.  The Committee may
require proof of minority, incompetence, incapacity or guardianship, as it may
deem appropriate prior to distribution of the benefit.  Any payment of a benefit shall be a payment
for the account of the Participant and the Participant’s Beneficiary, as the
case may be, and shall be a complete discharge of any liability under the Plan
for such payment amount.

 

17.14       Distribution in the Event of Taxation.  If, for any reason, all or any portion of a
Participant’s benefit under this Plan becomes includable in the Participant’s
gross income for Federal income tax purposes prior to receipt of such benefit,
the Participant may petition the Committee for a distribution of that portion
of his benefit that has become taxable. 
Upon the grant of such a petition, which grant shall not be unreasonably
withheld, the Participant’s Employer shall immediately distribute to the
Participant funds in an amount equal to the taxable portion of his benefit
(which amount shall not exceed the Participant’s unpaid Vested Account Balance
under the Plan).  If the petition is
granted, the tax liability distribution shall be made within ninety (90) days
of the date when the Participant’s petition is granted.  Such a distribution shall correspondingly
reduce the benefits with respect to the Participant under this Plan.

 

17.15       Insurance.  The Employers, on their own behalf or on behalf of the trustee of
the Trust, and, in their sole discretion, may apply for and procure insurance
on the life of the Participant, in such amounts and in such forms as the Trust
may choose.  The Employers or the
trustee of the Trust, as the case may be, shall be the sole owner and
beneficiary of any such insurance.  The
Participant shall have no interest whatsoever in any such policy or policies,
and at the request of the Employers shall submit to medical examinations and
supply such information and execute such documents as may be required by the
insurance company or companies to whom the Employers have applied for
insurance.

 

 

IN WITNESS WHEREOF,
this Plan document has been executed on behalf of the Company as of
November 1, 1999.

 

	
   

  	
   

  	
  McCORMICK &
  COMPANY, INCORPORATED

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/  Karen D.
  Weatherholtz

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Karen D.
  Weatherholtz

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice
  President – Human Relations

  
							

 

21

 

McCORMICK &
COMPANY, INCORPORATED

DEFERRED COMPENSATION PLAN

AMENDMENT NO. 1

 

This Amendment No.1 to the McCormick & Company,
Incorporated Deferred Compensation Plan (the “Plan”) is made this 29th day of
August, 2000.

 

WHEREAS, various proposed
changes to other Company benefit plans in which Plan Participants participate
will become effective December 1, 2000, but have not been finalized and
communicated to employees of the Company;

 

WHEREAS, these changes to
benefit plans may impact a Plan Participant’s decision with respect to his or
her Deferral Contribution under the Plan for the Plan Year beginning
January 1, 2001;

 

WHEREAS, an extension of
the date by which Participants must submit an Election Form with respect to the
Plan Year beginning January 1, 2001 will allow Participants to take into
account the proposed changes in other benefit plans in the calculation of
Deferral Contributions;

 

WHEREAS, it is advisable
to adjust the maximum deferral percentage for bonuses in order to accommodate
Company payroll systems;

 

NOW THEREFORE, pursuant
to Section 12.2 of the Plan, the Company hereby amends the Plan as
follows:

 

1.             The
period at the end of the second sentence of Section 1.20 is deleted and
the following language is inserted at the end of such sentence:

 

“and provided that the
Election Form must be submitted by October 31, 2000 in order to be timely
filed for the Plan Year beginning January 1, 2001.”

 

2.             Beginning
with the Plan Year beginning January 1, 2001, Section 3.1(d) is
amended by changing the Maximum Percentage for Deferral of Bonus from 90% to
80%.

 

3.             Each
capitalized term used herein shall have the meaning set forth in Article 1
of the Plan.

 

4.             All
other provisions of the Plan remain in full force and effect and are unchanged
by this Amendment.

 

WITNESS the signature of
the undersigned as of the date first above written.

 

	
   

  	
   

  	
  McCORMICK &
  COMPANY, INCORPORATED

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/  Karen D.
  Weatherholtz

  	
   

  
	
   

  	
   

  	
   

  	
  Karen D.
  Weatherholtz

  
	
   

  	
   

  	
   

  	
  Senior Vice
  President – Human Relations

  
							

 

22

 

McCORMICK &
COMPANY, INCORPORATED

DEFERRED COMPENSATION PLAN

 

AMENDMENT NO. 2

 

 

This Amendment No. 2 to the McCormick & Company,
Incorporated Deferred Compensation Plan (the “Plan”) is made this 5th day of
September, 2000.

 

WHEREAS, the Company
wishes to expand the eligibility of the Plan to include employees who serve on
boards of directors of United States divisions;

 

NOW THEREFORE, pursuant
to Section 12.2 of the Plan, the Company hereby amends the Plan as
follows:

 

1.     Section 2.1
is hereby amended by inserting the words “or who serve on boards of directors
of United States divisions of the Company” after the words “who are in Grades
15 or above.”

 

2.     Each
capitalized term used herein shall have the meaning set forth in Article 1
of the Plan.

 

3.     All
other provisions of the Plan remain in full force and effect and are unchanged
by this Amendment.

 

WITNESS the signature of
the undersigned as of the date first above written.

 

	
   

  	
   

  	
  McCORMICK &
  COMPANY, INCORPORATED

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/  Karen D.
  Weatherholtz

  	
   

  
	
   

  	
   

  	
   

  	
  Karen D.
  Weatherholtz

  
	
   

  	
   

  	
   

  	
  Senior Vice
  President – Human Relations

  
							

 

23

 

McCORMICK &
COMPANY, INCORPORATED

DEFERRED
COMPENSATION PLAN

 

AMENDMENT NO. 3

 

 

This Amendment No. 3 to the McCormick & Company,
Incorporated Deferred Compensation Plan (the “Plan”) is made this 16th day of
May, 2003.

 

WHEREAS, the Company
wishes to allow Plan participants to continue as participants in the Plan
following a change in their status which would no longer include them as
employees eligible to participate in the Plan;

 

NOW THEREFORE, pursuant
to Section 12.2 of the Plan, the Company hereby amends the Plan as
follows:

 

1.     Section 2.1
is hereby amended by the addition of the following sentence:

 

An employee who is
eligible to participate in the Plan by virtue of his or her service on a board
of directors of United States divisions of the Company, and who does
participate in the Plan, shall be eligible to continue participation in the
Plan even if such employee no longer serves on a board of directors of United
States divisions of the Company.

 

2.     Each
of the Capitalized terms used herein shall have the meaning set forth in
Article 1 of the Plan.

 

3.     All
other provisions of the Plan remain in full force and effect and are unchanged
by this Amendment.

 

WITNESS the signature of
the undersigned as of the date first above written.

 

	
   

  	
   

  	
  McCORMICK &
  COMPANY, INCORPORATED

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/  Karen D.
  Weatherholtz

  	
   

  
	
   

  	
   

  	
   

  	
  Karen D.
  Weatherholtz

  
	
   

  	
   

  	
   

  	
  Senior Vice
  President – Human Relations

  
						

 

24EXHIBIT
10(xi)

 

 

 

U.S. $100,000,000

 

364-DAY CREDIT AGREEMENT

 

dated as of May 30, 2003

 

 

among

 

McCORMICK & COMPANY,
INCORPORATED,

 

as the Borrower,

 

CERTAIN FINANCIAL INSTITUTIONS,

 

as the Lenders,

 

and

 

WACHOVIA BANK, NATIONAL ASSOCIATION,

 

as the Administrative Agent

 

 

WACHOVIA
SECURITIES, INC.

Lead Arranger and Book Manager

 

 

TABLE
OF CONTENTS

 

	
  ARTICLE
  I

  	
   

  
	
  DEFINITIONS AND
  ACCOUNTING TERMS

  	
   

  
	
   

  	
   

  
	
  SECTION 1.1.

  	
  Defined Terms

  	
   

  
	
  SECTION 1.2.

  	
  Use of Defined Terms

  	
   

  
	
  SECTION 1.3.

  	
  Cross-References

  	
   

  
	
  SECTION 1.4.

  	
  Accounting and Financial
  Determinations

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  II

  	
   

  
	
  MAKING
  THE LOANS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 2.1.

  	
  Commitments and
  Borrowing Procedure.

  	
   

  
	
  SECTION 2.2.

  	
  Reduction of the
  Commitment Amount

  	
   

  
	
  SECTION 2.3.

  	
  Continuation and
  Conversion Elections

  	
   

  
	
  SECTION 2.4.

  	
  Funding

  	
   

  
	
  SECTION 2.5.

  	
  Notes

  	
   

  
	
  SECTION 2.6.

  	
  Multicurrency Loans.

  	
   

  
	
  SECTION 2.6.1.

  	
  Notification of Request

  	
   

  
	
  SECTION 2.6.2.

  	
  Availability

  	
   

  
	
  SECTION 2.6.3.

  	
  Notification of
  Availability

  	
   

  
	
  SECTION 2.6.4.

  	
  Consequences of
  Availability

  	
   

  
	
  SECTION 2.6.5.

  	
  Unexpected
  Non-Availability

  	
   

  
	
  SECTION 2.6.6.

  	
  Consequences of
  Non-Availability

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
   

  
	
  REPAYMENT,
  PREPAYMENTS, INTEREST AND FEES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 3.1.

  	
  Repayment.

  	
   

  
	
  SECTION 3.2.

  	
  Prepayments.

  	
   

  
	
  SECTION 3.3.

  	
  Interest Provisions

  	
   

  
	
  SECTION 3.3.1.

  	
  Rates

  	
   

  
	
  SECTION 3.3.2.

  	
  Post-Maturity
  Rates

  	
   

  
	
  SECTION 3.3.3.

  	
  Payment Dates

  	
   

  
	
  SECTION 3.3.4.

  	
  Interest Rate
  Determination

  	
   

  
	
  SECTION 3.4.

  	
  Fees

  	
   

  
	
  SECTION 3.4.1.

  	
  Facility Fee

  	
   

  
	
  SECTION 3.4.2.

  	
  Utilization Fee

  	
   

  
	
  SECTION 3.4.3.

  	
  Agent’s Fees

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  IV

  	
   

  
	
  CERTAIN LIBO
  RATE AND OTHER PROVISIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 4.1.

  	
  Fixed Rate Lending
  Unlawful

  	
   

  
	
  SECTION 4.2.

  	
  Deposits Unavailable

  	
   

  
	
  SECTION 4.3.

  	
  Increased LIBO Rate Loan
  Costs, etc

  	
   

  
	
  SECTION 4.4.

  	
  Funding Losses

  	
   

  
	
  SECTION 4.5.

  	
  Increased Capital Costs

  	
   

  

 

 

	
  SECTION 4.6.

  	
  Taxes

  	
   

  
	
  SECTION 4.7.

  	
  Payments,
  Computations, etc.

  	
   

  
	
  SECTION 4.8.

  	
  Sharing of Payments

  	
   

  
	
  SECTION 4.9.

  	
  Setoff

  	
   

  
	
  SECTION 4.10.

  	
  Use of Proceeds

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  V

  	
   

  
	
  CONDITIONS PRECEDENT

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 5.1.

  	
  Conditions Precedent to
  the Obligations of the Lenders

  	
   

  
	
  SECTION 5.1.1.

  	
  Resolutions, etc

  	
   

  
	
  SECTION 5.1.2.

  	
  Officer’s
  Certificate

  	
   

  
	
  SECTION 5.1.3.

  	
  Closing Fees,
  Expenses, etc

  	
   

  
	
  SECTION 5.1.4.

  	
  Delivery of
  Financial Information

  	
   

  
	
  SECTION 5.1.5.

  	
  Delivery of Notes

  	
   

  
	
  SECTION 5.1.6.

  	
  Opinion of Counsel

  	
   

  
	
  SECTION 5.2.

  	
  Conditions Precedent to
  Borrowings

  	
   

  
	
  SECTION 5.2.1.

  	
  Compliance with
  Warranties, No Default, etc

  	
   

  
	
  SECTION 5.2.2.

  	
  Borrowing Request

  	
   

  
	
  SECTION 5.2.3.

  	
  Satisfactory Legal
  Form

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VI

  	
   

  
	
  REPRESENTATIONS AND
  WARRANTIES

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 6.1.

  	
  Organization, etc

  	
   

  
	
  SECTION 6.2.

  	
  Due Authorization,
  Non-Contravention etc

  	
   

  
	
  SECTION 6.3.

  	
  Government Approval
  Regulation, etc

  	
   

  
	
  SECTION 6.4.

  	
  Validity, etc

  	
   

  
	
  SECTION 6.5.

  	
  Financial Information

  	
   

  
	
  SECTION 6.6.

  	
  No Material Adverse
  Change

  	
   

  
	
  SECTION 6.7.

  	
  Litigation, Labor
  Controversies, etc

  	
   

  
	
  SECTION 6.8.

  	
  Subsidiaries

  	
   

  
	
  SECTION 6.9.

  	
  Ownership of Properties

  	
   

  
	
  SECTION 6.10.

  	
  Taxes

  	
   

  
	
  SECTION 6.11.

  	
  Pension and Welfare
  Plans

  	
   

  
	
  SECTION 6.12.

  	
  Environmental
  Warranties

  	
   

  
	
  SECTION 6.13.

  	
  Regulations U and X

  	
   

  
	
  SECTION 6.14.

  	
  Accuracy of
  Information

  	
   

  
	
  SECTION 6.15.

  	
  Compliance with Law;
  Absence of Default

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII

  	
   

  
	
  COVENANTS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 7.1.

  	
  Affirmative Covenants

  	
   

  
	
  SECTION 7.1.1.

  	
  Financial
  Information Reports, Notices, etc

  	
   

  
	
  SECTION 7.1.2.

  	
  Compliance with
  Laws, etc

  	
   

  
	
  SECTION 7.1.3.

  	
  Maintenance of
  Properties

  	
   

  

 

ii

 

	
  SECTION 7.1.4.

  	
  Insurance

  	
   

  
	
  SECTION 7.1.5.

  	
  Books and Records

  	
   

  
	
  SECTION 7.1.6.

  	
  Environmental
  Covenant

  	
   

  
	
  SECTION 7.2.

  	
  Negative Covenants

  	
   

  
	
  SECTION 7.2.1.

  	
  Transactions with
  Affiliates

  	
   

  
	
  SECTION 7.2.2.

  	
  Indebtedness

  	
   

  
	
  SECTION 7.2.3.

  	
  Liens

  	
   

  
	
  SECTION 7.2.4.

  	
  Mergers, Asset
  Dispositions, etc

  	
   

  
	
  SECTION 7.2.5.

  	
  EBIT to Interest
  Expense Ratio

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  	
   

  
	
  EVENTS
  OF DEFAULT

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 8.1.

  	
  Listing of Events of
  Default

  	
   

  
	
  SECTION 8.1.1.

  	
  Non-Payment of
  Obligations

  	
   

  
	
  SECTION 8.1.2.

  	
  Breach of Warranty

  	
   

  
	
  SECTION 8.1.3.

  	
  Non-Performance of
  Certain Covenants and Obligations

  	
   

  
	
  SECTION 8.1.4.

  	
  Non-Performance of
  Other Covenants and Obligations

  	
   

  
	
  SECTION 8.1.5.

  	
  Default on Other
  Indebtedness

  	
   

  
	
  SECTION 8.1.6.

  	
  Judgments

  	
   

  
	
  SECTION 8.1.7.

  	
  Pension Plans

  	
   

  
	
  SECTION 8.1.8.

  	
  Control of the
  Borrower

  	
   

  
	
  SECTION 8.1.9.

  	
  Bankruptcy,
  Insolvency, etc

  	
   

  
	
  SECTION 8.2.

  	
  Action if Bankruptcy

  	
   

  
	
  SECTION 8.3.

  	
  Action if Other Event of
  Default

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  IX

  	
   

  
	
  THE AGENT

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 9.1.

  	
  Appointment; Powers and
  Immunities

  	
   

  
	
  SECTION 9.2.

  	
  Reliance by Agent

  	
   

  
	
  SECTION 9.3.

  	
  Defaults

  	
   

  
	
  SECTION 9.4.

  	
  Rights of Agent and
  its Affiliates as a Lender

  	
   

  
	
  SECTION 9.5.

  	
  Indemnification

  	
   

  
	
  SECTION 9.6.

  	
  Consequential Damages

  	
   

  
	
  SECTION 9.7.

  	
  Registered Holder of
  Loan Treated as Owner

  	
   

  
	
  SECTION 9.8.

  	
  Nonreliance on Agent
  and Other Lenders

  	
   

  
	
  SECTION 9.9.

  	
  Failure to Act

  	
   

  
	
  SECTION 9.10.

  	
  Successor Agent

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  X

  	
   

  
	
  MISCELLANEOUS PROVISIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 10.1.

  	
  Waivers, Amendments,
  etc

  	
   

  
	
  SECTION 10.2.

  	
  Notices

  	
   

  
	
  SECTION 10.3.

  	
  Payment of Costs and
  Expenses

  	
   

  
	
  SECTION 10.4.

  	
  Indemnification

  	
   

  

 

iii

 

	
  SECTION 10.5.

  	
  Survival

  	
   

  
	
  SECTION 10.6.

  	
  Severability

  	
   

  
	
  SECTION 10.7.

  	
  Headings

  	
   

  
	
  SECTION 10.8.

  	
  Execution in
  Counterparts, Effectiveness, etc

  	
   

  
	
  SECTION 10.9.

  	
  Governing Law;
  Entire Agreement

  	
   

  
	
  SECTION 10.10.

  	
  Successors and
  Assigns

  	
   

  
	
  SECTION 10.11.

  	
  Sale and Transfer of
  Loans and Note; Participations in Loans and Note

  	
   

  
	
  SECTION 10.11.1.

  	
  Assignments

  	
   

  
	
  SECTION 10.11.2.

  	
  Participations

  	
   

  
	
  SECTION 10.12.

  	
  Other Transactions

  	
   

  
	
  SECTION 10.13.

  	
  Removal and
  Replacement of Lenders.

  	
   

  
	
  SECTION 10.14.

  	
  Forum Selection and
  Consent to Jurisdiction

  	
   

  
	
  SECTION 10.15.

  	
  WAIVER OF JURY
  TRIAL

  	
   

  

 

iv

 

SCHEDULES AND EXHIBITS

 

	
  SCHEDULE I

  	
  Disclosure Schedule

  
	
  EXHIBIT A

  	
  Existing Subsidiaries

  
	
  EXHIBIT B

  	
  Employee Benefit Plans

  
	
  EXHIBIT C

  	
  Existing Liens

  
	
   

  	
   

  
	
  EXHIBIT A-1

  	
  Form of Note

  
	
  EXHIBIT
  B-1

  	
  Form
  of Borrowing Request

  
	
  EXHIBIT C

  	
  Form of Lender
  Assignment Agreement

  
	
  EXHIBIT D

  	
  Form of Compliance
  Certificate

  
	
  EXHIBIT E

  	
  Form of
  Continuation/Conversion Notice

  
	
  EXHIBIT F

  	
  Form of
  Opinion of Counsel to the Borrower

  

 

v

 

364-DAY
CREDIT AGREEMENT

 

THIS 364-DAY CREDIT AGREEMENT, dated as of May 30,
2003, among McCORMICK & COMPANY, INCORPORATED, a Maryland corporation (the
“Borrower”), the various financial institutions parties hereto
(collectively, the “Lenders”) and WACHOVIA BANK, NATIONAL ASSOCIATION,
as the administrative agent (in such capacity, the “Agent”) for the
Lenders.

 

W
I T N E S S E T H:

 

WHEREAS, the Borrower has requested that the Lenders
provide to it a $100,000,000 364-day revolving line of credit; and the Lenders
and the Agent are willing to do so on the terms and conditions set forth
herein.

 

NOW, THEREFORE, in consideration of the premises and
the mutual covenants contained herein, the Borrower, the Lenders and the Agent
agree as follows:

 

ARTICLE I

 

DEFINITIONS AND ACCOUNTING TERMS

 

SECTION 1.1.  Defined Terms.  The following terms (whether or not
underscored) when used in this Agreement, including its preamble and recitals,
shall, except where the context otherwise requires, have the following meanings
(such meanings to be equally applicable to the singular and plural forms
thereof):

 

“Affiliate” of any Person means any other
Person which, directly or indirectly, controls, is controlled by or is under
common control with such Person (excluding any trustee under, or any committee
with responsibility for administering, any Plan).  A Person shall be deemed to be “controlled by” any other Person
if such other Person possesses, directly or indirectly, power

 

(a)           to vote 25% or more of
the securities (on a fully diluted basis) having ordinary voting power for the
election of directors or managing general partners; or

 

(b)           to direct or cause the
direction of the management and policies of such Person whether by contract or
otherwise;

 

provided,
however, that notwithstanding the foregoing, for purposes of Section
10.11.1, an “Affiliate” shall be a Person engaged in the business of
banking who is controlled by, or under common control with, a Lender.

 

“Agent” is defined in the preamble and
includes each other Person as shall have subsequently been appointed as the
successor Agent pursuant to Section 9.10.

 

“Agreement” means, on any date, this 364-Day
Credit Agreement as originally in effect on the Effective Date and as
thereafter from time to time amended, supplemented, amended and restated, or
otherwise modified and in effect on such date.

 

 

“Alternate Base Rate” means, on any date and
with respect to all Base Rate Loans, a fluctuating rate of interest per annum
equal to the higher of

 

(a)           the rate of interest
most recently announced by Wachovia Bank, National Association at its Domestic
Office as its prime rate, and

 

(b)           the Federal Funds Rate
most recently determined by the Agent plus 1/2 of 1% per annum.

 

The Alternate Base Rate
is not necessarily intended to be the lowest rate of interest determined by
Wachovia Bank, National Association in connection with extensions of
credit.  Changes in the rate of interest
on any Loans maintained as Base Rate Loans will take effect simultaneously with
each change in the Alternate Base Rate. 
The Agent will give notice promptly to the Borrower and the Lenders of
changes in the Alternate Base Rate.

 

“Alternate Currency” means any Currency, other
than Dollars, which the Lenders shall at any relevant time have agreed (in the
manner provided for herein) to treat as an Alternate Currency for the purposes
of the Commitment Amount and shall be the denomination for Alternate Currency
Advances.

 

“Alternate Currency Advance” means a LIBO Rate
Loan denominated in an Alternate Currency.

 

“Applicable Law” shall mean, in respect of any
Person, all provisions of constitutions, statutes, rules, regulations and
orders of governmental bodies or regulatory agencies applicable to such Person,
and all orders and decrees of all courts and arbitrators in proceedings or
actions to which the Person in question is a party or by which it is bound.

 

“Approved Fund” is defined in Section
10.11.1.

 

“Assignee Lender” is defined in Section
10.11.1.

 

“Associated Costs” means, with respect to any
LIBO Rate Loan denominated in Sterling, a rate per annum equal to the percentage
rate applicable to the LIBOR Office of the Reference Lender according to the
following formula:

 

	
  Associated Costs

  	
  =

  	
  BY + L (Y-X) + S
  (Y-Z)

  
	
  per annum

  	
   

  	
  100 - (X+S)

  

 

where, with respect to
the Reference Lender:

 

	
  B

  	
  =

  	
  The percentage of the
  Reference Lender’s eligible liabilities required, on the first day of the
  Relevant Period, to be held in a non-interest-bearing deposit account with
  the Bank of England pursuant to the cash ratio requirements of the Bank of
  England.

  
	
   

  	
   

  	
   

  
	
  Y

  	
  =

  	
  The LIBO Rate at which
  Sterling deposits in an amount comparable to the aggregate principal amount
  of the relevant LIBO Rate Loan are offered by 

  

 

2

 

	
   

  	
   

  	
  the Reference Lender to
  leading banks in the London interbank market at or about 11:00 a.m. (London
  time) on the first day of the Relevant Period for a period comparable to the
  Relevant Period.

  
	
   

  	
   

  	
   

  
	
  L

  	
  =

  	
  The average percentage
  of eligible liabilities which the Bank of England, as at the first day of the
  Relevant Period, requires the Reference Lender to maintain as secured money
  with members of the London Discount Market Association and/or as secured call
  money with those money brokers and gilt-edged primary market makers
  recognized by the Bank of England.

  
	
   

  	
   

  	
   

  
	
  X

  	
  =

  	
  The rate at which secured
  Sterling deposits in an amount comparable to the aggregate principal amount
  of the relevant LIBO Rate Loan may be placed by the Reference Lender with
  members of the London Discount Market Association and/or as secured call
  money with money brokers and gilt-edged primary market makers at or about
  11:00 a.m. (London time) on the first day of the Relevant Period for a period
  comparable to the Relevant Period.

  
	
   

  	
   

  	
   

  
	
  S

  	
  =

  	
  The percentage of the
  Reference Lender’s eligible liabilities required on the first day of the
  relevant Interest Period to be placed as a special deposit with the Bank of
  England.

  
	
   

  	
   

  	
   

  
	
  Z

  	
  =

  	
  The percentage interest
  rate per annum payable by the Bank of England on special deposits or, if
  lower, Y.

  

 

(a)             For the purposes of
this definition:

 

(i)  “eligible liabilities” and “special
deposits” shall have the meanings ascribed to them from time to time by the
Bank of England; and

 

(ii)  “Relevant Period” means, if the
Interest Period with respect to such LIBO Rate Loan is three months or less,
the duration of such Interest Period or, if such Interest Period is longer than
three months, each period of three months and any necessary shorter period in
such Interest Period.

 

(b)            In application of the
above formula, B, Y, L, X, S and Z will be included in the formula as decimal
fractions and not as percentages, e.g., if B = 0.5% and Y = 15%, BY will
be calculated as 0.5 x 15 and not as 0.5% x 15%.

 

(c)             Associated Costs
shall be computed by the Agent on the first day of each Relevant Period, and
shall, if necessary, be rounded upward to the nearest 1/10,000 of 1%.  If there is more than one Relevant Period
comprised in the relevant Interest Period, then the Associated Costs for that
Interest Period shall be the weighted average of the amounts so computed for the
relevant periods comprised in that Interest Period.

 

(d)            Calculations of
Associated Costs will be made on the basis of a year of 365 days.

 

3

 

“Attributable Value” means, as to any
particular Sale-Leaseback Transaction under which any Person is at the time
liable, at any date as of which the amount thereof is to be determined (i) in
the case of any such transaction involving a Capitalized Lease, the amount on
such date of the Capitalized Lease Obligation thereunder, or (ii) in the case
of any other such transaction, the then present value of the minimum rental
obligation under such transaction during the remaining term thereof (after
giving effect to any extensions at the option of the lessor), computed by
discounting the respective rental or other payments at the actual interest
factor included in such payment or, if such interest factor cannot be readily
determined, at the rate of 9.75% per annum, compounded annually, or calculated
in such other manner as may be required by GAAP in effect at the time.  The amount of any rental or other payment
required to be made under any such transaction not involving a Capitalized
Lease may exclude amounts required to be paid by the lessee (or equivalent
party) on account of maintenance, repairs, insurance, Taxes, assessments,
utilities, operating and labor costs and similar charges.  In the case of any such transaction not
involving a Capitalized Lease which is terminable by the lessee (or equivalent
party) upon payment of a penalty, such rental or other payment may include the
amount of such penalty, in which case no rental or other payment shall be
considered as required to be paid under such transaction subsequent to the
first date on which it may be so terminated.

 

“Authorized Officer” means, relative to the
Borrower, those of its officers whose signatures and incumbency shall have been
certified to the Agent and the Lenders pursuant to Section 5.1.1 or any
successor thereto.

 

“Available” means, in respect of any Alternate
Currency and any Lender, that such Alternate Currency is, at the relevant time,
readily available to such Lender as deposits in the London or other applicable
interbank market in the relevant amount and for the relevant term, is freely
convertible into Dollars and is freely transferable for the purposes of this
Agreement, but if, notwithstanding that each of the foregoing tests is
satisfied:

 

(a)           such Alternate Currency
is, under the then current legislation or regulations of the country of such
Alternate Currency (or under the policy of the central bank of such country) or
of the Bank of England or F.R.S.  Board,
not permitted to be used for the purposes of this Agreement; or

 

(b)           there is no, or only
insignificant, investor demand for the making of advances having an interest
period equivalent to that for the Alternate Currency Advance which the Borrower
has requested or in respect of which the Borrower has requested offers to be
made;

 

then such Alternate
Currency may be treated by any Lender as not being Available.

 

“Base Rate Loan” means a Loan bearing interest
at a fluctuating rate determined by reference to the Alternate Base Rate.

 

“Borrower” is defined in the preamble.

 

“Borrowing” means Loans of the same type made
by all Lenders on the same Business Day in accordance with Section 2.1.

 

4

 

“Borrowing Request” means a certificate
requesting Loans, duly executed by an Authorized Officer, substantially in the
form of Exhibit B-1 attached hereto.

 

“Business Day” means

 

(a)           any day which is
neither a Saturday or Sunday nor a legal holiday on which banks are authorized
or required to be closed in New York, New York; and

 

(b)           relative to the making,
continuing, prepaying or repaying of any LIBO Rate Loans, any day (i) on which
dealings in the relevant currency are carried on in the London interbank market
and (ii) in the case of LIBO Rate Loans denominated in a Currency other than
Dollars or Sterling, on which banks in the country for which such Currency is
the lawful currency are not authorized or required to be closed.

 

“Capitalized Leases” means all monetary
obligations of the Borrower or any of its Subsidiaries under any leasing or
similar arrangements which, in accordance with GAAP, would be classified as
capitalized leases.

 

“Capitalized Lease Obligation” means, at any
time, the present value of the minimum net lease payments during the term of a
Capitalized Lease, computed as provided in the Statement of Financial
Accounting Standards No. 13, as amended from time to time.

 

“CERCLA” means the Comprehensive Environmental
Response, Compensation and Liability Act of 1990, as amended.

 

“CERCLIS” means the Comprehensive Environmental
Response Compensation Liability Information System List.

 

“Change in Control” means (a) the acquisition
by any Person, or two or more Persons acting in concert, of beneficial
ownership (within the meaning of Rule 13d-3 of the Securities and Exchange
Commission under the Securities Exchange Act of 1934) of 51% or more of the
outstanding shares of voting stock of the Borrower after giving effect to
certain provisions of the Borrower’s Certificate of Incorporation with respect
to the conversion of non-voting stock to voting stock; provided,  however,
that acquisition by the Borrower’s pension plan or profit sharing plan of 51%
or more of the outstanding shares of the Borrower’s voting stock shall not
constitute a Change in Control; or (b) during any period of 12 consecutive
months, a majority of the members of the board of directors of the Borrower
cease to be composed of individuals (i) who were members of the board of
directors on the first day of such period, (ii) whose election or nomination to
the board of directors was approved by individuals referred to in clause (i)
above constituting at the time of such election or nomination at least a
majority of the board of directors or (iii) whose election or nomination to the
board of directors was approved by individuals referred to in clauses (i) and
(ii) above constituting at the time of such election or nomination at least a
majority of the board of directors.

 

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

 

“Commitment” means a Lender’s obligation to
make Loans pursuant to Section 2.1.

 

5

 

“Commitment Amount” means U.S. $100,000,000, as
such amount may be reduced or adjusted from time to time in accordance with
this Agreement.

 

“Commitment Termination Event” means

 

(a)           the occurrence of any
Event of Default described in clauses (a) through (e) of Section
8.1.9 with respect to the Borrower or any Principal Subsidiary; or

 

(b)           the occurrence and
continuance of any other Event of Default and either

 

(i)  the declaration of the Loans to be due and
payable pursuant to Section 8.3, or

 

(ii)  in the absence of such declaration, the
giving of notice by the Agent, acting at the direction of the Required Lenders
pursuant to Section 8.3, to the Borrower that the Commitments have been
terminated.

 

“Consolidated Net Tangible Assets” means all
assets of the Borrower and its Subsidiaries appearing on a consolidated balance
sheet of the Borrower and its Subsidiaries prepared in accordance with GAAP minus
goodwill and other intangible assets other than prepaid allowances.

 

“Contingent Liability” means any agreement,
undertaking or arrangement by which any Person guarantees, endorses or
otherwise becomes or is contingently liable upon (by direct or indirect
agreement, contingent or otherwise, to provide funds for payment, to supply
funds to, or otherwise to invest in, a debtor, or otherwise to assure a
creditor against loss) the indebtedness, obligation or any other liability of
any other Person (other than by endorsements of instruments in the course of
collection), or guarantees the payment of dividends or other distributions upon
the shares of any other Person.  The
amount of any Person’s obligation under any Contingent Liability shall (subject
to any limitation set forth therein) be deemed to be the outstanding principal
amount (or maximum amount, if larger) of the debt, obligation or other
liability guaranteed thereby.

 

“Continuation/Conversion Notice” means a notice
of continuation or conversion and certificate duly executed by an Authorized
Officer of the Borrower, substantially in the form of Exhibit E hereto.

 

“Controlled Group” means all members of a
controlled group of corporations and all members of a controlled group of
trades or businesses (whether or not incorporated) under common control which,
together with the Borrower, are treated as a single employer under Section
414(b) or 414(c) of the Code or Section 4001 of ERISA.

 

“Currency” and “Currencies” means
Dollars, Deutschemarks, Yen, Sterling and Euro.

 

“Default” means any Event of Default or
condition, occurrence or event which, after notice or lapse of time or both,
would constitute an Event of Default.

 

6

 

“Deutschemark” and “DM” mean the lawful
currency of the Federal Republic of Germany.

 

“Disclosure Schedule” means the Disclosure
Schedule attached hereto as Schedule I, as it may be amended,
supplemented or otherwise modified from time to time by the Borrower with the
written consent of the Agent and the Required Lenders.

 

“Dollars” and the sign “$” each mean the
lawful currency of the United States of America.

 

“Dollar Equivalent” of any amount of any
Alternate Currency or Non-Major Alternate Currency on any date means the
equivalent amount in Dollars, converted at the rate of exchange quoted by
Wachovia Bank, National Association at its New York office to prime banks in
New York for the spot purchase in the New York foreign exchange market of the
relevant Alternate Currency or, to the extent spot quotations are available,
the Non-Major Alternate Currency, in each case at approximately 11:00 a.m. (New
York time) on such date in accordance with its normal practice.

 

“Domestic Office” means, relative to any
Lender, the office of such Lender designated as such below its signature hereto
or designated in the Lender Assignment Agreement or such other office of a
Lender (or any successor or assign of such Lender) within the United States as
may be designated from time to time by notice from such Lender, as the case may
be, to each other Person party hereto.

 

“EBIT” means, for any period, the sum of the
amounts for such period of (a) Net Income (excluding any one-time non-recurring
charges), (b) Interest Expense and (c) charges for federal, state, local and
foreign income taxes, all determined in accordance with GAAP.

 

“Euro” means the euro referred to in Council
Regulation (EC) no. 1103/97 dated June 17, 1997 passed by the Council of the
European Union, or, if different, the then lawful currency of the member states
of the European Union that participates in the third stage of Economic and
Monetary Union.

 

“Effective Date” shall mean the first date on
which this Agreement shall have been fully signed in accordance with Section 10.8
and each of the conditions precedent set forth in Section 5.1 have been
satisfied.

 

“Environmental Laws” means all applicable
federal, state or local statutes, laws, ordinances, codes, rules and
regulations (including consent decrees and administrative orders issued to the
Borrower or any Subsidiary) relating to public health and safety and protection
of the environment.

 

“ERISA” means the Employee Retirement Income
Security Act of 1974, as amended, and any successor statute of similar import,
together with the regulations thereunder, in each case as in effect from time
to time.  References to sections of
ERISA also refer to any successor sections.

 

“Event of Default” is defined in Section 8.1.

 

7

 

“Federal Funds Rate” means, for any period, a
fluctuating interest rate per annum equal for each day during such period to
the rate of interest most recently offered to the Agent in the interbank market
as the overnight federal funds rate.

 

“Fiscal Quarter” means any quarter of a Fiscal
Year.

 

“Fiscal Year” means any period of twelve
consecutive calendar months ending on November 30; references to a Fiscal Year
with a number corresponding to any calendar year (e.g., the “2002 Fiscal
Year”) refer to the Fiscal Year ending on the November 30 occurring during such
calendar year.

 

“Foreign Currency Equivalent” of any amount of
Dollars in any Alternate Currency or Non-Major Alternate Currency on any date
means the equivalent amount in the relevant currency converted at the rate of
exchange quoted under the heading “Exchange Rates — Currency per U.S. $” in The
Wall Street Journal for the immediately preceding Business Day for such
Alternate Currency or Non-Major Alternate Currency.

 

“F.R.S. Board” means the Board of Governors of
the Federal Reserve System or any successor thereto.

 

“GAAP” is defined in Section 1.4.

 

“Granting Lender” is defined in Section
10.11.1.

 

“Hazardous Material” means

 

(a)           any “hazardous
substance”, as defined by CERCLA;

 

(b)           any “hazardous waste”,
as defined by the Resource Conservation and Recovery Act, as amended;

 

(c)           any petroleum product;
or

 

(d)           any pollutant or
contaminant or hazardous, dangerous or toxic chemical, material or substance
within the meaning of any other applicable federal, state or local law,
regulation, ordinance or requirement (including consent decrees and
administrative orders issued to the Borrower or any Subsidiary) relating to or
imposing liability or standards of conduct concerning any hazardous, toxic or
dangerous waste, substance or material, all as amended or hereafter amended.

 

“herein,” “hereof,” “hereto,” “hereunder”
and similar terms contained in this Agreement or any other Loan Document refer
to this Agreement or such other Loan Document, as the case may be, as a whole
and not to any particular Section, paragraph or provision of this Agreement or
such other Loan Document.

 

“Impermissible Qualification” means, relative
to the opinion or certification of any independent public accountant as to any
financial statement of the Borrower, any qualification or exception to such
opinion or certification

 

8

 

(a)           which is of a “going
concern” or similar nature;

 

(b)           which relates to the
limited scope of examination of matters relevant to such financial statement;
or

 

(c)           which relates to the
treatment or classification of any item in such financial statement and which,
as a condition to its removal, would require an adjustment to such item the
effect of which would be to cause the Borrower to be in default of any of its
obligations under Section 7.2.4.

 

“including” means including without limiting
the generality of any description preceding such term, and, for purposes of
this Agreement and each other Loan Document, the parties hereto agree that the
rule of ejusdem  generis shall not be applicable to limit a
general statement, which is followed by or referable to an enumeration of
specific matters, to matters similar to the matters specifically mentioned.

 

“Indebtedness” of any Person means, without
duplication, any obligation (whether present or future, actual or contingent,
secured or unsecured, as principal or surety or otherwise) for the payment or
repayment of money which would be regarded as indebtedness in accordance with
GAAP, including all Contingent Liabilities of such Person in respect of any
such obligations.

 

For all purposes of this Agreement, the Indebtedness
of any Person shall include the Indebtedness of any partnership in which such
Person is a general partner; provided,  however, that the
Indebtedness of any Person shall not include any obligation of a partnership in
which such Person is a general partner to the extent that such obligation
(including any Contingent Liability) is limited by its terms.

 

“Indemnified Liabilities” is defined in Section
10.4.

 

“Indemnified Parties” is defined in Section
10.4.

 

“Interest Expense” means, for any period, all
as determined in accordance with GAAP, total interest expense, whether paid or
accrued (without duplication) (including the interest component of Capitalized
Lease Obligations), of the Borrower and its Subsidiaries on a consolidated
basis, including, without limitation, all bank fees, commissions, discounts and
other fees and charges owed with respect to letters of credit, but excluding,
however, amortization of discount, interest paid in property other than cash or
any other interest expense not payable in cash.

 

“Interest Period” means, relative to any LIBO
Rate Loans, the period beginning on (and including) the date on which such LIBO
Rate Loans are made or continued as, or converted into, LIBO Rate Loans
pursuant to Section 2.1 or 2.3 and shall end on (but exclude) the
day which numerically corresponds to such date one, two, three or six months
thereafter (or, if such month has no numerically corresponding day, on the last
Business Day of such month), the Borrower may select in its relevant notice
pursuant to Section 2.3; provided,  however, that

 

9

 

(a)           the Borrower shall not
be permitted to select Interest Periods to be in effect at any one time which
have expiration dates occurring on more than five different dates;

 

(b)           Interest Periods
commencing on the same date for Loans comprising part of the same Borrowing
shall be of the same duration;

 

(c)           if such Interest Period
would otherwise end on a day which is not a Business Day, such Interest Period
shall end on the next following Business Day (unless, such next following
Business Day is the first Business Day of a calendar month, in which case such
Interest Period shall end on the Business Day next preceding such numerically
corresponding day); and

 

(d)           no Interest Period may
end later than the Maturity Date.

 

“Lead Arranger” means Wachovia Securities, Inc.

 

“Lender Assignment Agreement” means a Lender
Assignment Agreement substantially in the form of Exhibit C hereto.

 

“Lenders” has the meaning specified in the
preamble.

 

“LIBO Alternate Rate” is defined in Section
3.3.1.

 

“LIBO Rate” is defined in Section 3.3.1.

 

“LIBO Rate Loan” means a Loan bearing interest,
at all times during an Interest Period applicable to such Loan, at a fixed rate
of interest determined by reference to the LIBO Rate (Reserve Adjusted).

 

“LIBO Rate (Reserve Adjusted)” is defined in Section
3.3.1.

 

“LIBOR Office” means, relative to any Lender,
the office of such Lender designated as such below its signature hereto or
designated in the Lender Assignment Agreement or such other office of a Lender
as designated from time to time by notice from such Lender to the Borrower and
the Agent, whether or not outside the United States, which shall be making or
maintaining LIBO Rate Loans of such Lender hereunder.

 

“LIBOR Reserve Percentage” is defined in Section
3.3.1.

 

“Lien” means any security interest, mortgage,
pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien
(statutory or otherwise), charge against or interest in property to secure
payment of a debt or performance of an obligation or other priority or
preferential arrangement of any kind or nature whatsoever.

 

“Loans” means a loan made on a Business Day by
each Lender to the Borrower pursuant to Section 2.1 during the period
commencing on the Effective Date until (but not including) the 

 

10

 

Maturity Date.  The aggregate
principal amount at any time outstanding of all Loans made by the Lenders shall
not exceed the Commitment Amount.

 

“Loan Document” means this Agreement, the
Notes, the Transaction Fee Letter and each other document and agreement
delivered to the Agent in connection herewith or therewith.

 

“Material Adverse Effect” means any event which
will, or is reasonably likely to, have a material adverse effect on (i) the
financial condition, assets, liabilities, operations or business of the
Borrower and its Subsidiaries taken as a whole or (ii) the Borrower’s ability
to perform and comply with its monetary obligations under this Agreement, the
Notes and each other Loan Document.

 

“Maturity Date” means the earlier to occur of

 

(a)           May 29, 2004;

 

(b)           the date on which the
Commitment Amount is terminated in full or reduced to zero pursuant to Section
2.2; and

 

(c)           immediately and without
further notice upon the occurrence of any Commitment Termination Event.

 

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

 

“Net Income” means, for any period, with
respect to the Borrower and its Subsidiaries, income from continuing operations
of the Borrower and its Subsidiaries during such period, determined in
accordance with GAAP.

 

“Non-Major Alternate Currencies” means all
currencies other than the Alternate Currencies and Dollars.

 

“Note” means a promissory note of the Borrower
payable to any Lender, in the form of Exhibit A-1 hereto (as such
promissory note may be amended, endorsed or otherwise modified from time to
time), evidencing the aggregate Indebtedness of the Borrower to such Lender
resulting from Loans outstanding from such Lender, and also means all other
promissory notes accepted from time to time in substitution therefor or renewal
thereof.

 

“Obligations” means all obligations (monetary
or otherwise) of the Borrower arising under or in connection with this
Agreement, the Notes and each other Loan Document.

 

“Organic Document” means, (a) relative to the
Borrower, its certificate of incorporation, its by-laws and all shareholder
agreements, voting trusts and similar arrangements applicable to any of its
authorized shares of capital stock and (b) relative to any Subsidiary, its
applicable corporate, partnership, joint venture or limited liability company
organizational and governing documents and all arrangements applicable to any
of its equity, ownership or membership interests.

 

“Participant” is defined in Section 10.11.2.

 

11

 

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

 

“Pension Plan” means a “pension plan,” as such
term is defined in Section 3(2) of ERISA, which is subject to Title IV of ERISA
(other than a multiemployer plan as defined in Section 4001(a)(3) of ERISA),
and to which the Borrower or any corporation, trade or business that is, along
with the Borrower, a member of a Controlled Group, may have liability,
including any liability by reason of having been a substantial employer within
the meaning of Section 4063 of ERISA at any time during the preceding five
years, or by reason of being deemed to be a contributing sponsor under Section
4069 of ERISA.

 

“Percentage” means, relative to any Lender, the
percentage set forth opposite its signature hereto or set forth in the Lender
Assignment Agreement, as such percentage may be adjusted from time to time
pursuant to Lender Assignment Agreement(s) executed by such Lender and its
Assignee Lender(s) and delivered pursuant to Section 10.11.

 

“Person” means any individual, trustee,
corporation, general partnership, limited partnership, limited liability
company, joint stock company, firm, business association, trust, unincorporated
organization, bank, joint venture, government, governmental authority or any
other entity, whether acting in an individual, fiduciary or other capacity.

 

“Plan” means any Pension Plan or Welfare Plan.

 

“Principal Subsidiary” means a Subsidiary (i)
whose total assets or net sales (each such amount expressed on a consolidated
basis in the case of a Subsidiary which itself has Subsidiaries) represent,
respectively, not less than 15% of either the consolidated total assets or
consolidated net sales of the Borrower and its Subsidiaries, all as calculated
annually by reference to the immediately preceding Fiscal Year-end financial
data (consolidated or unconsolidated, as the case may be) of such Subsidiary
and the then latest Fiscal Year-end audited consolidated financial statements
of the Borrower, or (ii) to which is transferred all or substantially all of
the assets or undertakings of a Principal Subsidiary.  A certificate by an Authorized Officer of the Borrower as to
whether a Subsidiary is or is not or was or was not a Principal Subsidiary at a
specified date shall, in the absence of manifest error, be conclusive and
binding.

 

“Quarterly Payment Date” means the last day of
each calendar quarter or, if any such day is not a Business Day, the next
succeeding Business Day.

 

“Reference Lender” means Wachovia Bank,
National Association.

 

“Related Person” means, with respect to any
Person, the outstanding capital stock of which is at least 25%, but not more
than 50% beneficially owned by the Borrower or its Subsidiaries.

 

“Release” means a “release,” as such
term is defined in CERCLA.

 

“Required Lenders” means, at any time,

 

12

 

(a)           except as otherwise
provided in clause (c) hereof, with respect to any provision of this
Agreement other than the declaration of the acceleration of the maturity of all
or any portion of the outstanding principal amount of the Loans and other
Obligations to be due and payable pursuant to Section 8.3, Lenders
having greater than 50% of the Commitment Amount,

 

(b)
except as otherwise provided in clause (c) hereof, with respect to the
declaration of the acceleration of the maturity of all or any portion of the
outstanding principal amount of the Loans and other obligations to be due and
payable pursuant to Section 8.3, Lenders holding Loans representing
greater than 50% of the aggregate principal amount of the Loans outstanding, or

 

(c)           with respect to any
waiver of a Default or any amendment or modification of any provision of this
Agreement or any other Loan Document which would have the effect of waiving a
Default, Lenders having greater than (i) 50% of the Commitment Amount or (ii)
if the Commitments have been terminated, 50% of the aggregate principal amount
of the Loans outstanding.

 

“Resource Conservation and Recovery Act” means
the Resource Conservation and Recovery Act, 42 U.S.C.  Section 690, et  seq., as in effect from time to
time.

 

“Revolving Commitment Amount” means, on any
date, relative to any Lender, the amount equal to such Lender’s Percentage
multiplied by the Commitment Amount.

 

“Sale-Leaseback Transaction” means any
arrangement, directly or indirectly, with any Person whereby a seller or
transferor shall sell or otherwise transfer any real or personal property if,
as part of the same transaction or series of transactions, the seller or
transferor shall then or thereafter lease as lessee, or similarly acquire the
right to possession or use of, such sold or transferred property, or property
which it intends to use substantially to the same extent or for the same
purpose as such sold or transferred property, in any such case under any lease,
agreement or other arrangement, whether or not involving a Capitalized Lease,
with the Person to whom such property was sold or transferred (other than any
such lease, agreement or arrangement having a term, including renewals, not exceeding
three years) which obligates the seller or transferor to pay rent as lessee or
make any other payment to such Person for such possession or use.

 

“Senior Debt Rating” means the Borrower’s
senior, unsecured non-credit-enhanced long term debt rating, as determined by
S&P and Moody’s.

 

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

 

“SPC” is defined in Section 10.11.1.

 

“Sterling” and “f” mean the lawful
currency of the United Kingdom of Great Britain and Northern Ireland.

 

13

 

“Subsidiary” means, with respect to any Person,
any corporation, partnership, joint venture, limited liability company or other
business entity of which more than 50% of the outstanding capital stock or
other interests having ordinary voting power to elect a majority of the board
of directors or other governing body of such entity (irrespective of whether at
the time securities or interests of any other class or classes of such entity
shall or might have voting power upon the occurrence of any contingency) is at
the time, directly or indirectly, beneficially owned by such Person, by such
Person and one or more other Subsidiaries of such Person, or by one or more
other Subsidiaries of such Person. 
Unless otherwise indicated, when used in this Agreement, the term
“Subsidiary” shall refer to a Subsidiary of the Borrower.

 

“Taxes” is defined in Section 4.6.

 

“Telerate Page 3750” means the display
designated as “Page 3750” on the Telerate Service (or such other page as may
replace Page 3750 on the service or such other service as may be nominated by
the British Bankers’ Association as the information vendor for the purpose of
displaying British Bankers’ Association interest settlement rates for
Deutschemark, U.S. Dollar, Sterling or Yen deposits)

 

“Transaction Fee Letter” means the confidential
letter agreement, dated May     , 2003, by and between the
Agent, the Lead Arranger and the Borrower.

 

“type” means, relative to any Loan, the portion
thereof being maintained as a Base Rate Loan or a LIBO Rate Loan.

 

“United States” or “U.S.” means the
United States of America, its fifty States and the District of Columbia.

 

“Utilization Fee Rate” means, at any time, the
percentage rate per annum at which utilization fees are accruing pursuant to Section
3.4.2 at such time as set forth within such Section.

 

“Welfare Plan” means a “welfare plan,”
as such term is defined in Section 3(l) of ERISA.

 

“Yen” and “¥” means the lawful currency
of Japan.

 

SECTION 1.2.  Use of Defined Terms.  Unless otherwise defined or the context
otherwise requires, terms for which meanings are provided in this Agreement
shall have such meanings when used in the Disclosure Schedule and in each Note,
Loan Document, Borrowing Request, Continuation/Conversion Notice, notice,
request and other communication delivered from time to time in connection with
this Agreement or any other Loan Document.

 

SECTION 1.3.  Cross-References.  Unless otherwise specified, references in
this Agreement and in each other Loan Document to any Article or Section are
references to such Article or Section of this Agreement or such other Loan
Document, as the case may be, and, unless otherwise specified, references in
any Article, Section or definition to any clause are references to such clause
of such Article, Section or definition.

 

14

 

SECTION 1.4.  Accounting and Financial Determinations.  Unless otherwise specified, all accounting
terms used herein or in any other Loan Document shall be interpreted, all
accounting determinations and computations hereunder or thereunder (including
under Sections 7.2.2 and 7.2.4) shall be made in accordance with
generally accepted accounting principles (“GAAP”) as in effect on the
Effective Date of this Agreement, and all financial statements required to be
delivered hereunder or thereunder shall be prepared in accordance with GAAP as
in effect on the date of, or for the period covered by, such financial
statements, and applied in the preparation of the financial statements referred
to in Section 6.5.

 

ARTICLE II

 

MAKING THE LOANS

 

SECTION 2.1.  Commitments and Borrowing Procedure.

 

(a)           Commitments.  Subject to the terms and conditions of this
Agreement (including Article V), each Lender severally and for itself
alone agrees that it will make Loans pursuant to its Commitment described in
this Section 2.1.  From time to
time, on any Business Day occurring prior to the Maturity Date, each Lender
will make Loans to the Borrower equal to such Lender’s Percentage of the
aggregate amount of the Borrowing requested by the Borrower to be made by all
Lenders on such day.  No Lender shall be
required to make any Loan if, after giving effect thereto, the aggregate
outstanding principal amount of all Loans (determined in the case of Loans
denominated in a currency other than Dollars on the basis of the Dollar
Equivalent thereof) of all Lenders would exceed the Commitment Amount.  Subject to the terms hereof, the Borrower
may from time to time borrow, repay and reborrow Loans under this Agreement.

 

(b)           Borrowing
Procedure.  By delivering a
Borrowing Request to the Agent on a Business Day on or before 10:00 a.m. (New
York City time), the Borrower may from time to time irrevocably request a Loan
to be made (a) (i) in respect of any Borrowing comprised of Loans denominated
in Dollars bearing interest at the LIBO Rate, on not less than three nor more
than five Business Days’ notice, and in respect of any Borrowing comprised of
(ii) Loans denominated in an Alternate Currency bearing interest at the LIBO
Rate, on not less than five nor more than ten Business Days, notice and (b) in
respect of any Borrowing comprised of Loans denominated in Dollars bearing
interest at the Alternate Base Rate, on not less than one Business Day’s
notice.  Each Borrowing Request must be
in an aggregate minimum amount of $10,000,000 and in integral multiples of
$1,000,000, or the Foreign Currency Equivalent thereof in the case of Loans
made in an Alternate Currency.  Subject
to the terms and conditions of this Agreement, each Borrowing shall be made on
the Business Day specified in the Borrowing Request therefor.  On such Business Day, each Lender shall
deposit in an account maintained with the Agent same day funds, on or before
11:00 a.m. (New York City time) (or, in the case of Loans denominated in a
currency other than Dollars, on or before a mutually agreed upon time), in an
amount equal to such Lender’s Percentage of the requested Borrowing in the
relevant currency, such deposit to be made to such account as the Agent shall
specify from time to time by notice to the Lenders.  No 

 

15

 

Lender’s
obligation to make any Loan shall be affected by any other Lender’s failure to
make any Loan.

 

SECTION 2.2.  Reduction of the Commitment Amount.  The Commitment Amount is subject to
reduction from time to time pursuant to this Section.  The Borrower may, from time to time on any Business Day
voluntarily reduce the Commitment Amount; provided,  however, that
all such reductions under this Section shall be subject to Section 3.2(b),
require at least three Business Days’ prior notice to the Agent, be permanent,
be applied to the Lenders’ Revolving Commitment Amounts pro  rata
in accordance with their respective Percentages, and any partial reduction of
the Commitment Amount shall be in a minimum amount of $10,000,000 and in an
integral multiple of $5,000,000.

 

SECTION 2.3.  Continuation and Conversion Elections.  By delivering a Continuation/Conversion
Notice to the Agent on or before 11:00 a.m. (New York City time) on a Business
Day, the Borrower may from time to time irrevocably elect, on not less than
three nor more than five Business Days’ notice, that all, or any portion in an
aggregate minimum amount of $5,000,000 and an integral multiple of $1,000,000
or the Foreign Currency Equivalent thereof, of the Loans be, (a) in the case of
Base Rate Loans, converted into LIBO Rate Loans, (b) in the case of LIBO Rate
Loans denominated in Dollars, be converted into Base Rate Loans or continued as
LIBO Rate Loans, or (c) in the case of LIBO Rate Loans denominated in an
Alternate Currency, continued as LIBO Rate Loans in the same Currency.

 

In the absence of delivery of a Continuation/Conversion
Notice with respect to LIBO Rate Loans at least three Business Days’ before the
last day of the then current Interest Period with respect thereto,

 

(a)           LIBO
Rate Loans denominated in Dollars shall be converted automatically on such last
day to Base Rate Loans, and

 

(b)           LIBO
Rate Loans denominated in an Alternate Currency shall be continued as Loans in
the relevant Alternate Currency at a rate per annum equal to the LIBO Alternate
Rate for such relevant Currency plus the applicable margin for the shortest
available interest period selected by the Agent in its sole discretion (but not
later than the Maturity Date).

 

Each such conversion and continuation shall be
prorated among the applicable outstanding Loans of all Lenders, and no portion of
the outstanding principal amount of any Loans may be continued as, or be
converted into, LIBO Rate Loans when any Default has occurred and is
continuing.  The Agent shall promptly
notify each Lender of the applicable interest period and interest rate.

 

SECTION 2.4.  Funding.  Each Lender may, if it so elects, fulfill its obligation to make,
continue or convert LIBO Rate Loans hereunder by causing one of its foreign
branches or Affiliates (or an international banking facility created by such
Lender) to make, continue or convert such LIBO Rate Loan; provided,  however,
that such LIBO Rate Loan shall nonetheless be deemed to have been made and to
be held by such Lender, and the obligation of the Borrower to repay such LIBO
Rate Loan shall nevertheless be to such Lender for the account of such 

 

16

 

foreign branch,
Affiliate or international banking facility. 
In addition, the Borrower hereby consents and agrees that, for purposes
of any determination to be made for purposes of Section 4.1, 4.2,
4.3 it shall be conclusively assumed that each Lender elected to fund
all LIBO Rate Loans by purchasing deposits in the relevant currency in the
relevant interbank eurodollar market.

 

SECTION 2.5.  Notes.  Each Lender’s Loans shall be evidenced by a Note payable to the
order of such Lender in a principal amount equal to such Lender’s original
Revolving Commitment Amount.  The
Borrower hereby irrevocably authorizes each Lender to make (or cause to be
made) appropriate notations on the grid attached to such Lender’s Note (or on
any continuation of such grid), which notations, if made, shall evidence, inter
alia, the date of, the outstanding principal of and Interest Period
applicable to the Loans evidenced thereby. 
Such notations shall constitute prima facie evidence of the accuracy of
the information so recorded; provided,  however, that the failure
of any Lender to make any such notations shall not limit or otherwise affect
any obligations of the Borrower.

 

SECTION 2.6.  Multicurrency Loans.

 

SECTION 2.6.1.  Notification of Request.  If any Borrowing Request requests a
Borrowing in an Alternate Currency, the Agent shall in the notice given to the
Lenders pursuant to Section 2.1 give details of such request including,
without limitation, the aggregate principal amount of the Borrowing in such
Alternate Currency to be made by each Lender pursuant to this Agreement.

 

SECTION 2.6.2.  Availability.  Each Lender shall be treated as having
confirmed that the Alternate Currency requested is Available to it unless no
later than 10:00 a.m. (New York City time) on the third Business Day before the
Borrowing it shall have notified the Agent that such Alternate Currency is not
Available.

 

SECTION 2.6.3.  Notification of Availability.  No later than 2:00 p.m. (New York City time)
on the third Business Day before the proposed Borrowing the Agent shall notify
the Borrower and the Lenders if it has received notification from any of the
Lenders that the Alternate Currency is not Available.

 

SECTION 2.6.4.  Consequences of Availability.  If the Agent does not notify the Borrower
and the Lenders that the Agent has received notification from any of the
Lenders that the Alternate Currency requested is not Available, the Lenders
shall, on the proposed date of the Borrowing specified in the Borrowing Request
become obligated, subject to this Section 2.6, to make the LIBO Rate
Loan in accordance with the provisions of this Agreement.

 

SECTION 2.6.5.  Unexpected Non-Availability.  If, at any time before 10:00 a.m. (New York
City time) on the proposed Borrowing date, any Lender shall have determined
that the Alternate Currency in which it is obliged to make a LIBO Rate Loan is
no longer Available to it by reason that, under the then current legislation or
regulations of the country of incorporation of such Lender or the country of
such Alternate Currency (or the then policy of the central bank of such
country) or the Bank of England or the F.R.S. 
Board, such Alternate Currency is not or will not be permitted to be
used for the purposes of this Agreement, then such Lender shall give 

 

17

 

notice to the
Agent (and shall include in such notice a statement of which other Alternate
Currencies are not Available to such Lender), and the Agent shall give notice
to the Borrower, and the obligation of such Lender to make its share of such
Borrowing in such Alternate Currency shall be replaced on the following basis:

 

(a)           The
Borrower shall be entitled to notify the Agent (which shall promptly notify
each affected Lender) not later than 10:00 a.m. (New York City time) on the
third Business Day before the proposed Borrowing, that the Borrower elects
either that the said obligation of the relevant Lender shall be:

 

(i)            replaced
by an obligation to make a Loan in Dollars by that Lender having an aggregate
principal amount equal to its share of such Borrowing in the Alternate
Currency, rounded, if necessary, as the Agent shall decide, which such Lender
would otherwise have been required to make; or

 

(ii)           replaced
by an obligation to make a LIBO Rate Loan in an Alternate Currency by that
Lender in an Alternate Currency (other than any Alternate Currency which such
Lender shall have stated, as provided above, is not Available to it), such
Alternate Currency having an aggregate principal amount which is, on the date
on which such notification is actually received by the Agent, the equivalent
amount of its share of such Borrowing, rounded, if necessary, as the Agent
shall decide, which such Lender would otherwise have been requested to make.

 

(b)           For
purposes of clauses (i) and (ii) of paragraph (a) of this
Section, any rounding in the amount of Loans by the Agent shall not result in
any Lender making Loans in an aggregate principal amount exceeding such
Lender’s Commitment.

 

(c)           If
the Borrower has not notified the Agent as provided in paragraph (a)
above, the obligation of the Lender shall be replaced by such an obligation as
is mentioned in clause 2.7.5(a)(i).

 

If such Lender shall be
required under paragraph (a) or paragraph (b) of Section 2.6.5
to make the Loan mentioned therein, such Borrowing shall be made on the date of
the proposed Borrowing, shall have the same Interest Period as the Alternate
Currency Advance which it replaces and the applicable interest rate shall be
calculated in accordance with Section 3.3.1 (as though such Borrowing
were a separate Loan denominated in Dollars or, as the case may be, in the
relevant Alternate Currency).

 

SECTION 2.6.6.  Consequences of Non-Availability.  If the Agent notifies the Borrower pursuant
to Section 2.6.3 that any of the Lenders has notified the Agent that the
Alternate Currency is not Available, such notification shall revoke the
relevant Borrowing Request.

 

18

 

ARTICLE III

 

REPAYMENT,
PREPAYMENTS, INTEREST AND FEES

 

SECTION 3.1.  Repayment.

 

(a)           The
Borrower shall repay in full the unpaid principal amount of all Loans on the
Maturity Date.

 

(b)           The
Borrower shall, immediately upon any acceleration of the Maturity Date of any
Loans pursuant to Section 8.2 or Section 8.3, repay the aggregate
unpaid principal amount of all Loans so accelerated.

 

SECTION 3.2.  Prepayments.

 

(a)           The
Borrower may, from time to time on any Business Day, make a voluntary
prepayment, in whole or in part, of the outstanding principal amount of any
Loans; provided,  however, that

 

(i)            any
such prepayment shall be made pro  rata among Loans of the same
type and, if applicable, having the same Interest Period of all Lenders,

 

(ii)           all
such voluntary prepayments shall require at least three Business Days’ prior
written notice to the Agent, and

 

(iii)          all such voluntary partial prepayments shall
be in an aggregate minimum amount of $5,000,000 and an integral multiple of $1,000,000
or, if denominated in a Currency other than Dollars, the Foreign Currency
Equivalent thereof, rounded to the nearest one million units of such Currency.

 

(b)           The
Borrower shall, on each date when any reduction in the Commitment Amount shall
become effective including pursuant to Section 2.2, make a mandatory
prepayment of Loans equal to the excess, if any, of the aggregate outstanding
principal amount of all Loans over the Commitment Amount as so reduced.

 

(c)           On
the date of the making of any Loan and on the date of a Continuation/Conversion
Notice with respect to any Loan or at any other time periodically, the Agent
shall determine that the aggregate principal amount of all Loans outstanding
(after converting all Loans denominated in Alternate Currencies or Non-Major
Alternate Currencies to their Dollar Equivalent on the date of calculation) is
greater than 100% of the Commitment Amount then in effect, the Borrower shall,
upon three Business Days, written notice from the Agent, prepay an aggregate principal
amount of such Loans denominated in Alternate Currencies or Non-Major Alternate
Currencies, as the case may be, such that the Dollar Equivalent of the
outstanding principal amount of such Loans, when added to the aggregate
principal amount of all Loans outstanding denominated in Dollars, does not
exceed the Commitment Amount.

 

(d)           Each
prepayment of any Loans made pursuant to this Section shall be without premium
or penalty, except as may be required by Section 4.4.  No voluntary prepayment of principal of any
Loans shall cause a reduction in the Commitment Amount.

 

SECTION 3.3.  Interest Provisions.  Interest on the outstanding principal amount
of Loans shall accrue and be payable in accordance with this Section 3.3.

 

19

 

SECTION 3.3.1.  Rates.  Pursuant to an appropriately delivered Borrowing Request or
Continuation/Conversion Notice, the Borrower may elect that the Loans accrue
interest at a rate per annum:

 

(a)           on
that portion maintained from time to time as Base Rate Loans, equal to the
Alternate Base Rate from time to time in effect;

 

(b)           on
that portion maintained as LIBO Rate Loans, during each Interest Period
applicable thereto, equal to the sum of the LIBO Rate (Reserve Adjusted) or the
LIBO Alternate Rate, as the case may be, applicable to the relevant Currency
for such Interest Period plus the margin set forth below opposite the
Borrower’s Senior Debt Ratings in the following table:

 

	
  If the Borrower’s

  Senior Debt Ratings are

  	
   

  	
  The

  Applicable

  Margin is

  
	
  S&P

  	
   

  	
  Moody’s

  	
   

  
	
  A+ or above

  	
   

  	
  A1 or above

  	
   

  	
  15.50 b.p.

  
	
  A

  	
   

  	
  A2

  	
   

  	
  23.00  b.p.

  
	
  A-

  	
   

  	
  A3

  	
   

  	
  31.50  b.p.

  
	
  BBB+

  	
   

  	
  Baa1

  	
   

  	
  39.50  b.p.

  
	
  BBB

  	
   

  	
  Baa2

  	
   

  	
  50.00  b.p.

  
	
  BBB- or below

  	
   

  	
  Baa3 or below

  	
   

  	
  70.00  b.p.

  

 

If, during any Interest
Period, there is any change in such Senior Debt Ratings which would result in
an adjustment in the Applicable Margin, such adjustment shall be effective as
of the date on which such change occurs. 
For purposes of determining the Applicable Margin, if Moody’s and
S&P have split Senior Debt Ratings with a difference of only one rating
tier, the higher Senior Debt Rating shall be determinative and the lower Senior
Debt Rating shall be disregarded, and if Moody’s and S&P have split Senior
Debt Ratings with a difference of more than one rating tier, the debt rating
one rating tier below the higher Senior Debt Rating will be determinative and
both Senior Debt Ratings will be disregarded; and

 

provided,
however, that if the interest rate elected by the Borrower exceeds the
highest lawful rate, then the applicable interest rate per annum for any Loan
shall be the highest lawful rate.

 

The “LIBO Alternate Rate” means, with respect
to any Loan for which a Continuation/Conversion Notice has not been delivered
in accordance with Section 2.3 that is denominated in any
Alternate/Currency, relative to the interest period therefor selected by the
Agent in its sole discretion,

 

(a)           in the case of Loans
denominated in Sterling, the sum of

 

20

 

(i)            the rate of interest
equal to the average (rounded upwards, if necessary, to the nearest 1/16 of 1%)
of the rates per annum at which Sterling deposits in immediately available
funds are offered to the Reference Lender’s LIBOR Office in the London
interbank market as at or about 11:00 a.m. (London time) on the first day of
such interest period for delivery on the first day of such interest period, and
in an amount approximately equal to the relevant amount and for a period
approximately equal to such interest period;

 

plus

 

(ii)           Associated Costs; and

 

(b)           in the case of Loans
denominated in Alternate Currencies other than Sterling, the rate of interest
equal to the average (rounded upwards, if necessary, to the nearest 1/16 of 1%)
of the rates per annum at which the relevant Currency deposits in immediately
available funds are offered to the Reference Lender’s LIBOR Office in the
London interbank market as at or about 11:00 a.m. (London time) two Business
Days prior to the beginning of such interest period for delivery on the first
day of such interest period, and in an amount approximately equal to the
relevant amount and for a period approximately equal to such interest period.

 

If the relevant amount is
all or part of a LIBO Rate Loan in an Alternate Currency which became due and
payable on a day other than the last day of the Interest Period relating
thereto, the first such interest period selected by the Agent shall be of a
duration equal to the unexpired portion of the such Interest Period.  The LIBO Alternate Rate for any interest
period for any Loan bearing interest at the LIBO Alternate Rate will be
determined by the Agent on the basis of information in effect on, and the
applicable rates furnished to and received by the Agent from the Reference
Lender, (x) in the case of Sterling, on the first day of such interest period,
or (y) in the case of Alternate Currencies (other than Sterling), two Business
Days before the first day of such interest period, subject, however,
to the provisions of Section 3.3.4. 
If for any such interest period selected by the Agent, adequate means do
not exist for the Reference Lender to determine the LIBO Alternate Rate for any
Currency as set forth above, the LIBO Alternate Rate for such Currency shall be
determined by reference to the cost to the Reference Lender of obtaining
deposits of such Currency from such sources as the Reference Lender may
reasonably select.  The Agent shall
determine the LIBO Alternate Rate for each such interest period (which
determination shall be conclusive in the absence of manifest error), and will
promptly give notice to the Borrower and the Lenders thereof.

 

The “LIBO Rate (Reserve Adjusted)” means,
relative to any Loan to be made, continued or maintained as, or converted into,
a LIBO Rate Loan bearing interest at the LIBO Rate or the LIBO Alternate Rate,
as the case may be, for any Interest Period,

 

(a)           which is denominated in
Dollars, a rate per annum (rounded upwards, if necessary, to the nearest 1/16
of 1%) determined pursuant to the following formula:

 

	
  LIBO Rate

  	
  =

  	
  LIBO Rate

  
	
  (Reserve
  Adjusted)

  	
   

  	
  1.00 - LIBOR
  Reserve Percentage

  

 

21

 

(b)           which is denominated in
Sterling, a rate per annum (rounded upwards, if necessary, to the nearest 1/16
of 1%) determined pursuant to the following formula:

 

	
  LIBO Rate

  	
  =

  	
  LIBO

  	
  +

  	
  Associated Costs

  
	
  (Reserve
  Adjusted)

  	
   

  	
  Rate

  	
   

  	
   

  

 

(c)           which is denominated in
any other Alternate Currency, the relevant LIBO Rate or LIBO Alternate Rate, as
the case may be, plus any applicable reserve or other funding costs incurred by
the Lenders in making such Loan.

 

The LIBO Rate (Reserve Adjusted) for any Interest
Period for LIBO Rate Loans will be determined by the Agent on the basis of the
LIBOR Reserve Percentage in effect on, and the applicable rates furnished to
and received by the Agent from the Reference Lender, two Business Days before
the first day of such Interest Period, subject, however, to the provisions of Section
3.3.4.

 

“LIBO Rate” means, relative to any Interest
Period,

 

(a)  with respect to LIBO Rate Loans denominated
in Dollars, the rate of interest equal to the average (rounded upwards, if
necessary, to the nearest 1/16 of 1%) of the rates per annum at which Dollar
deposits in immediately available funds are offered to the Reference Lender’s
LIBOR Office in the London interbank market as at or about 11:00 a.m. London
time two Business Days prior to the beginning of such Interest Period for
delivery on the first day of such Interest Period, and in an amount
approximately equal to the amount of the Reference Lender’s LIBO Rate Loan and
for a period approximately equal to such Interest Period;

 

(b)  with respect to LIBO Rate Loans denominated
in any Alternate Currency, the rate of interest equal to the average (rounded
upwards, if necessary, to the nearest 1/10,000 of 1%) for the relevant
Alternate Currency for a period equal to such Interest Period which appears

 

(i)            with respect to
Sterling, on Telerate, Page 3750;

 

(ii)           with respect to Euros,
on Telerate Page 3750;

 

(iii)          with respect to Deutschemarks,
on Telerate Page 3750; and

 

(iv)          with respect to Yen, on
Telerate Page 3750;

 

as of 11:00 a.m. (London
time) (x) in the case of Sterling, on the first day of such Interest Period, or
(y) in the case of Alternate Currencies (other than Sterling), two Business
Days before the first day of such Interest Period, or, if fewer than two such
offered rates appear on the relevant Telerate Page, the rate of interest equal
to the average (rounded upwards, if necessary, to the nearest 1/10,000 of 1%) of
the rates per annum at which deposits in the relevant Alternate Currency in
immediately available funds are offered to the Reference Lender’s LIBOR Office
in the London interbank market as at or about 11:00 a.m. (London time) (x) in
the case of Sterling, on the first day of such Interest Period, or (y) in the
case of Alternate Currencies (other than 

 

22

 

Sterling), two Business
Days before the first day of such Interest Period for delivery on the first day
of such Interest Period, and in an amount approximately equal to the amount of
the Loans requested and for a period approximately equal to such Interest
Period.

 

“LIBOR Reserve Percentages” means, relative to
any Interest Period for LIBO Rate Loans, the reserve percentage (expressed as a
decimal) equal to the maximum aggregate reserve requirements (including all
basic, emergency, supplemental, marginal and other reserves and taking into
account any transitional adjustments or other scheduled changes in reserve
requirements) specified under regulations issued from time to time by the
F.R.S. Board and then applicable to assets or liabilities consisting of and
including “Eurocurrency Liabilities”, as currently defined in Regulation D of
the F.R.S. Board, having a term approximately equal or comparable to such
Interest Period.

 

All LIBO Rate Loans shall bear interest from and
including the first day of the applicable Interest Period to (but not
including) the last day of such Interest Period at the interest rate determined
as applicable to such LIBO Rate Loan.

 

SECTION 3.3.2.  Post-Maturity Rates.  After the date any principal amount of any
Loan is due and payable (whether on the Maturity Date, upon acceleration or
otherwise), or after any other monetary Obligation shall have become due and
payable, the Borrower shall pay, but only to the extent permitted by law,
interest (after as well as before judgment) on such amounts at a rate per annum
equal to the Alternate Base Rate plus a margin of 2% for Loans denominated in
Dollars and, with respect to Loans denominated in an Alternate Currency, at a
rate per annum equal to the LIBO Rate or LIBO Alternate Rate, as the case may
be, in such Alternate Currency plus a margin of 2%.

 

SECTION 3.3.3.  Payment Dates.  Interest accrued on each Loan shall be
payable, without duplication:

 

(a)           on
the Maturity Date;

 

(b)           on
the date of any payment or prepayment, in whole or in part, of principal
outstanding on such Loan;

 

(c)           with
respect to LIBO Rate Loans, on the last day of each applicable Interest Period
(and, if such Interest Period shall exceed three months, on each three (and
integral multiple of three) month anniversary of the making of such Loan);

 

(d)           with
respect to Base Rate Loans, on each Quarterly Payment Date;

 

(e)           with
respect to any Base Rate Loans converted into LIBO Rate Loans on a day when
interest would not otherwise have been payable pursuant to clause (d),
on the date of such conversion; and

 

(f)            on
that portion of any Loans the Maturity Date of which is accelerated pursuant to
Section 8.2 or Section 8.3, immediately upon such
acceleration.

 

23

 

Interest accrued on Loans
or other monetary Obligations arising under this Agreement or any other Loan
Document after the date such amount is due and payable (whether on the Maturity
Date, upon acceleration or otherwise) shall be payable upon demand.

 

SECTION 3.3.4.  Interest Rate Determination.  The Reference Lender agrees to furnish to
the Agent timely information for the purpose of determining the LIBO Rate and
the LIBO Alternate Rate.  The Agent
shall provide each Lender with the LIBO Rate applicable to each LIBO Rate Loan
within two Business Days prior to the making of such LIBO Rate Loan.

 

SECTION 3.4.  Fees.  The Borrower agrees to pay the fees set forth in this Section
3.4.  All such fees shall be
nonrefundable.

 

SECTION 3.4.1.  Facility Fee.  The Borrower agrees to pay to the Agent for
the pro  rata account of each Lender, in accordance with such
Lender’s Percentage, an annual facility fee equal to the Commitment Amount
multiplied by the fee set forth below opposite the Borrower’s Senior Debt
Ratings during the quarter for which the fee is calculated (any change in such
Senior Debt Ratings to result in an adjustment in the applicable facility fee,
such adjustment to be effective as of the date on which such change occurs):

 

	
  If the
  Borrower’s

  Senior Debt Ratings Are

  	
   

  	
  The
  Facility

  Fee Is

  
	
  S&P

  	
   

  	
  Moody’s

  	
   

  
	
  A+ or above

  	
   

  	
  A1 or above

  	
   

  	
  6.00 b.p.

  
	
  A

  	
   

  	
  A2

  	
   

  	
  7.00 b.p.

  
	
  A-

  	
   

  	
  A3

  	
   

  	
  8.50 b.p.

  
	
  BBB+

  	
   

  	
  Baa1

  	
   

  	
  10.50 b.p.

  
	
  BBB

  	
   

  	
  Baa2

  	
   

  	
  12.50 b.p.

  
	
  BBB- or below

  	
   

  	
  Baa3 or below

  	
   

  	
  17.50 b.p.

  

 

provided
that, for purposes of determining the facility fee, if Moody’s and S&P have
split Senior Debt Ratings with a difference of only one rating tier, the higher
Senior Debt Rating shall be determinative and the lower Senior Debt Rating
shall be disregarded, and provided, further, if Moody’s and
S&P have split Senior Debt Ratings with a difference of more than one
rating tier, the debt rating one rating tier below the higher Senior Debt
Rating will be determinative and both Senior Debt Ratings will be disregarded.

 

The facility fee payable under this Section shall be
based on the average daily Commitment Amount from the date hereof to and
including the Maturity Date, such fee to be payable quarterly in arrears on
each Quarterly Payment Date and on the Maturity Date, and regardless of the
amount of Loans outstanding under this Agreement; provided,  however,
that in the event a Commitment Termination Event has occurred, such that the
Commitments of the 

 

24

 

Lenders hereunder are terminated, the Borrower shall only be obligated
to pay such facility fee to the extent that it has accrued up to the date of
such Commitment Termination Event.

 

SECTION 3.4.2.  Utilization Fee.  The Borrower agrees to pay to the Agent for
the pro  rata account of each Lender, in accordance with such
Lender’s Loans, a utilization fee for each day from the date hereof to and
including the Maturity Date for each day that the aggregate principal amount of
Loans outstanding on the close of business (if a Business Day) of such day is
equal to or greater than 50% of the sum of the Commitment Amount.  The utilization fee shall accrue at all
times, including at any time during which one or more of the conditions in Article
V is not met.  If applicable, such
utilization fee shall be equal to the aggregate principal amount of all Loans
outstanding on the close of business (if a Business Day) of such day multiplied
by the Utilization Fee Rate set forth below opposite the Borrower’s Senior Debt
Ratings during the day for which the fee is calculated (any change in such
Senior Debt Ratings to result in an adjustment in the applicable utilization
fee, such adjustment to be effective as of the date on which such change
occurs), payable quarterly in arrears on each Quarterly Payment Date and on the
Maturity Date:

 

	
  If the
  Borrower’s

  Senior Debt Ratings Are

  	
   

  	
  Utilization
  Fee

  Rate

  
	
  S&P

  	
   

  	
  Moody’s

  	
   

  
	
  A+ or above

  	
   

  	
  A1 or above

  	
   

  	
  10.00 b.p.

  
	
  A

  	
   

  	
  A2

  	
   

  	
  10.00 b.p.

  
	
  A-

  	
   

  	
  A3

  	
   

  	
  10.00 b.p.

  
	
  BBB+

  	
   

  	
  Baa1

  	
   

  	
  12.50 b.p.

  
	
  BBB

  	
   

  	
  Baa2

  	
   

  	
  12.50 b.p.

  
	
  BBB- or below

  	
   

  	
  Baa3 or below

  	
   

  	
  12.50 b.p.

  

 

provided
that, for purposes of determining the utilization fee, if Moody’s and S&P
have split Senior Debt Ratings with a difference of only one rating tier, the
higher Senior Debt Rating shall be determinative and the lower Senior Debt
Rating shall be disregarded, and provided, further, if Moody’s
and S&P have split Senior Debt Ratings with a difference of more than one
rating tier, the debt rating one rating tier below the higher Senior Debt
Rating will be determinative and both Senior Debt Ratings will be disregarded.

 

SECTION 3.4.3.  Agent’s Fees.  The Borrower agrees to pay to the Agent and
the Lead Arranger for their own accounts, fees in such amounts and on such
dates as are set forth in the Transaction Fee Letter.

 

25

 

ARTICLE IV

 

CERTAIN
LIBO RATE AND OTHER PROVISIONS

 

SECTION 4.1.  Fixed Rate Lending Unlawful.  If any Lender shall determine (which
determination shall, upon notice thereof to the Borrower and the Lenders, be
conclusive and binding on the Borrower) that the introduction of or any change
in or in the interpretation of any law makes it unlawful, or any central bank
or other governmental authority asserts that it is unlawful, for such Lender to
make, continue or maintain any Loan as, or to convert any Loan into, a LIBO
Rate Loan , the obligations of all Lenders to make, continue, maintain or
convert any such Loans shall, upon such determination, forthwith be suspended
until such Lender shall notify the Agent that the circumstances causing such
suspension no longer exist, and (a) all LIBO Rate Loans denominated in Dollars
shall automatically convert into Base Rate Loans at the end of the then current
Interest Periods with respect thereto or sooner, if required by such law or
assertion; and (b) all LIBO Rate Loans denominated in any Alternate Currency
shall automatically become due and payable at the end of the then current
Interest Periods with respect thereto or sooner, if required by applicable law.

 

SECTION 4.2.  Deposits Unavailable.  If the Agent shall have determined that:

 

(a)           Dollar
deposits in the relevant amount and for the relevant Interest Period are not
available to the Reference Lender in their relevant market; or

 

(b)           by
reason of circumstances affecting the Reference Lender’s relevant market,
adequate means do not exist for ascertaining the interest rate applicable
hereunder to LIBO Rate Loans, then, upon notice from the Agent to the Borrower
and the Lenders, the obligations of all Lenders under clause (b) of Section
2.1 to make or continue any Loans as, or to convert any Loans into, LIBO
Rate Loans shall forthwith be suspended until the Agent shall notify the
Borrower and the Lenders that the circumstances causing such suspension no
longer exist.

 

SECTION 4.3.  Increased LIBO Rate Loan Costs, etc.  The Borrower agrees to reimburse each Lender
for any increase in the cost to such Lender of, or any reduction in the amount
of any sum receivable by such Lender in respect of, making, continuing or
maintaining (or of its obligation to make, continue or maintain) any Loans as,
or of converting (or of its obligation to convert) any Loans into, LIBO Rate
Loans, including, without limitation, by reason of any requirements imposed by
the Bank of England upon the making or funding of LIBO Rate Loans.  Such Lender shall promptly notify the Agent
and the Borrower in writing of the occurrence of any such event, such notice to
state, in reasonable detail, the reasons therefor and the additional amount
required fully to compensate such Lender for such increased cost or reduced
amount.  Such additional amounts shall
be payable by the Borrower directly to such Lender within five days of its
receipt of such notice, and such notice shall, in the absence of manifest
error, be conclusive and binding on the Borrower.

 

SECTION 4.4.  Funding Losses.  In the event any Lender shall incur any loss
or expense by reason of the liquidation or reemployment of deposits or other
funds acquired by such Lender to make, continue or maintain any portion of the
principal amount of any Loan as, or to convert 

 

26

 

any portion of the
principal amount of any Loan into, a LIBO Rate Loan as a result of (a) any
repayment or prepayment of the principal amount of any LIBO Rate Loans on a
date other than the scheduled last day of the Interest Period applicable
thereto, whether pursuant to Section 3.1, Section 3.2 or
otherwise; (b) any Loans not being made as LIBO Rate Loans in accordance with
the Borrowing Request therefor; or (c) any Loans not being continued as, or
converted into LIBO Rate Loans in accordance with the Continuation/Conversion
Notice therefor then, upon the written notice of such Lender to the Borrower
(with a copy to the Agent), the Borrower shall, within five days of its receipt
thereof, pay directly to such Lender such amount as will (in the reasonable
determination of such Lender) reimburse such Lender for such loss or
expense.  Such written notice (which
shall include calculations in reasonable detail) shall, in the absence of
manifest error, be conclusive and binding on the Borrower.

 

SECTION 4.5.  Increased Capital Costs.  If any change in, or the introduction,
adoption, effectiveness, interpretation, reinterpretation or phase-in of, any
law or regulation, directive, guideline, decision or request (whether or not
having the force of law) of any court, central bank, regulator or other
governmental authority after the date hereof affects or would affect the amount
of capital required or expected to be maintained by any Lender, and such Lender
determines (in its sole and absolute discretion) that the rate of return on its
capital as a consequence of its Commitment or the Loans made by such Lender is
reduced to a level below that which such Lender could have achieved but for the
occurrence of any such circumstance, then, in any such case upon notice from
time to time by such Lender to the Borrower, the Borrower shall immediately pay
directly to such Lender additional amounts sufficient to compensate such Lender
for such reduction in rate of return.  A
statement of such Lender as to any such additional amount or amounts (including
calculations thereof in reasonable detail) shall, in the absence of manifest
error, be conclusive and binding on the Borrower.  In determining such amount, such Lender may use any method of
averaging and attribution that it (in its sole and absolute discretion) shall
deem applicable.

 

SECTION 4.6.  Taxes.  All payments by the Borrower of principal of, and interest on,
the Loans and all other amounts payable hereunder shall be made free and clear
of and without deduction for any present or future income, excise, stamp or
franchise taxes and other taxes, fees, duties, withholdings or other charges of
any nature whatsoever imposed by any taxing authority, but excluding franchise
taxes (in lieu of net income taxes) and taxes imposed on or measured by any
Lender’s net income or receipts (such nonexcluded items being called “Taxes”).  In the event that any withholding or
deduction from any payment to be made by the Borrower hereunder is required in
respect of any Taxes pursuant to any applicable law, rule or regulation, then
the Borrower will:

 

(a)           pay
directly to the relevant authority the full amount required to be so withheld
or deducted;

 

(b)           promptly
forward to the Agent an official receipt or other documentation satisfactory to
the Agent evidencing such payment to such authority; and

 

(c)           pay
to the Agent for the account of the Lenders such additional amount or amounts
as is necessary to ensure that the net amount actually received by each Lender 

 

27

 

will equal the full
amount such Lender would have received had no such withholding or deduction
been required.

 

Moreover, if any Taxes are directly asserted against
the Agent or any Lender with respect to any payment received by the Agent or
such Lender hereunder, the Agent or such Lender may pay such Taxes and the
Borrower will promptly pay such additional amounts (including any penalties,
interest or expenses) as is necessary in order that the net amount received by
such person after the payment of such Taxes (including any Taxes on such
additional amount) shall equal the amount such person would have received had
not such Taxes been asserted.

 

If the Borrower fails to pay any Taxes when due to the
appropriate taxing authority or fails to remit to the Agent, for the account of
the respective Lenders, the required receipts or other required documentary
evidence, the Borrower shall indemnify the Lenders for any incremental Taxes,
interest or penalties that may become payable by any Lender as a result of any
such failure.  For purposes of this Section
4.6, a distribution hereunder by the Agent or any Lender to or for the
account of any Lender shall be deemed a payment by the Borrower.

 

Upon the request of the Borrower or the Agent, each
Lender and Assignee Lender that is organized under the laws of a jurisdiction
other than the United States shall, on or prior to the date hereof (in the case
of each Lender that is a party hereto on the date hereof) or on or prior to the
date of any assignment hereunder (in the case of an Assignee Lender) and
thereafter as reasonably requested from time to time by the Borrower or Agent,
execute and deliver to the Borrower and the Agent, one or more (as the Borrower
or the Agent may reasonably request) United States Internal Revenue Service
Forms W-8EC or Forms W-8BEN or such other forms or documents (or successor
forms or documents), appropriately completed, as may be applicable to establish
the extent, if any, to which a payment to such Lender is exempt from, or
entitled to a reduced rate of, withholding or deduction of Taxes.

 

SECTION 4.7.  Payments, Computations, etc.

 

(a)           Unless
otherwise expressly provided, all payments by the Borrower pursuant to this
Agreement, the Notes or any other Loan Document shall be made by the Borrower
to the Agent for the pro  rata account of the Lenders entitled to
receive such payment.

 

(b)           All
such payments required to be made to the Agent shall be made, without setoff,
deduction or counterclaim, by means of wire transfer to be initiated (i) in the
case of Loans denominated in Dollars, not later than 11:00 a.m. (New York City
time) and (ii) in the case of Loans denominated in a currency other than
Dollars, not later than the time reasonably specified by the Agent, in each
case on the date due, in same day or immediately available funds, in the
applicable currency, to such account as the Agent shall specify from time to
time by notice to the Borrower.  Funds
for which the wire transfer was initiated after the times specified in the
preceding sentence shall be deemed to have been received by the Agent on the
next succeeding Business Day.  The Agent
shall promptly remit in same day funds, in the applicable currency, to each
Lender its share, if any, of such payments received by the Agent for the
account of such Lender.

 

28

 

(c)           Subject
to the calculation of interest provided in the definition of “Associated
Costs”, all interest and fees shall be computed on the basis of the actual
number of days (including the first day but excluding the last day) occurring
during the period for which such interest or fees is payable over a year
comprised of 360 days (or, in the case of interest on Base Rate Loans, 365 days
or, if appropriate, 366 days).  whenever
any payment to be made shall otherwise be due on a day which is not a Business
Day, such payment shall (except as otherwise required by clause (c) of
the definition of the term “Interest Period”) be made on the next
succeeding Business Day and such extension of time shall be included in
computing interest in connection with such payment.

 

(d)           Each
Lender will use its best efforts to notify the Borrower of any event that will
entitle such Lender to compensation or reimbursement (including on a
prospective basis) pursuant to Article IV hereof (including pursuant to Sections
4.5 and 4.6), as promptly as practicable after it obtains knowledge
thereof, but the failure to give such notice shall not impair the right of such
Lender to receive compensation or reimbursement under this Section.

 

(e)           Each
Lender shall determine the applicability of, and the amount due under, Article
IV hereof (including Sections 4.5 and 4.6) consistent with
the manner in which it applies similar provisions and calculates similar
amounts payable to it by other borrowers having in their credit agreements
provisions comparable to those contained in Article IV.

 

SECTION 4.8.  Sharing of Payments.  If any Lender shall obtain any payment or
other recovery (whether voluntary, involuntary, by application of setoff or
otherwise) on account of any Loan (other than pursuant to the terms of Sections
4.3, 4.4 and 4.5) in excess of its pro  rata
share of payments then or therewith obtained by all Lenders, such Lender shall
purchase from the other Lenders such participations in Loans made by them as
shall be necessary to cause such purchasing Lender to share the excess payment
or other recovery ratably with each of them; provided,  however,
that if all or any portion of the excess payment or other recovery is
thereafter recovered from such purchasing Lender, the purchase shall be
rescinded and each Lender which has sold a participation to the purchasing
Lender shall repay to the purchasing Lender the purchase price to the ratable
extent of such recovery together with an amount equal to such selling Lender’s
ratable share (according to the proportion of

 

(a)           the
amount of such selling Lender’s required repayment to the purchasing Lender

 

to

 

(b)           the
total amount so recovered from the purchasing Lender) of any interest or other
amount paid or payable by the purchasing Lender in respect of the total amount
so recovered.  The Borrower agrees that
any Lender so purchasing a participation from another Lender pursuant to this
Section may, to the fullest extent permitted by law, exercise all its rights of
payment (including pursuant to Section 4.9) with respect to such
participation as fully as if such Lender were the direct creditor of the
Borrower in the amount of such participation. 
If under any applicable bankruptcy, insolvency or other 

 

29

 

similar law, any
Lender receives a secured claim in lieu of a setoff to which this Section
applies, such Lender shall, to the extent practicable, exercise its rights in
respect of such secured claim in a manner consistent with the rights of the
Lenders entitled under this Section to share in the benefits of any recovery on
such secured claim.

 

SECTION 4.9.  Setoff.  Each Lender shall, upon the occurrence of any Event of Default
described in clauses (a) through (d) of Section 8.1.9 or,
upon the occurrence of any other Event of Default, have the right to
appropriate and apply to the payment of the obligations owing to it (whether or
not then due) any and all balances, credits, deposits, accounts or moneys of the
Borrower then or thereafter maintained with such Lender or any Affiliate of
such Lender; provided,  however, that any such appropriation and
application shall be subject to the provisions of Section 4.8.  Each Lender agrees promptly to notify the
Borrower and the Agent after any such setoff and application made by such
Lender; provided,  however, that the failure to give such notice
shall not affect the validity of such setoff and application.  The rights of each Lender under this Section
are in addition to other rights and remedies (including other rights of setoff
under applicable law or otherwise) which such Lender may have.

 

SECTION 4.10.  Use of Proceeds.  The Borrower shall use the proceeds of the
Loans for general corporate purposes and for commercial paper backup; without
limiting the foregoing, no proceeds of any Loan will be used to acquire any
equity security of a Person as part of a hostile takeover.

 

ARTICLE V

 

CONDITIONS PRECEDENT

 

SECTION 5.1.  Conditions Precedent to the Obligations
of the Lenders.  The obligations of
the Lenders under this Agreement shall be subject to the prior or concurrent
satisfaction of each of the conditions precedent set forth in this Section
5.1.

 

SECTION 5.1.1.  Resolutions, etc.  The Agent shall have received from the
Borrower a certificate, dated the same date as this Agreement, of its Secretary
or Assistant Secretary as to

 

(a)           resolutions
of its Board of Directors then in full force and effect authorizing the
execution, delivery and performance of this Agreement, the Notes and each other
Loan Document to be executed by it,

 

(b)           the
incumbency and signatures of those of its officers authorized to act with
respect to this Agreement, the Notes and each other Loan Document executed by
it, upon which certificate each Lender may conclusively rely until it shall
have received a further certificate of the Secretary of the Borrower canceling
or amending such prior certificate, and

 

(c)           true
and correct copies of the Organic Documents of the Borrower.

 

SECTION 5.1.2.  Officer’s Certificate.  The Agent shall have received a certificate,
dated the date of this Agreement, signed by an Authorized Officer of the
Borrower certifying (a) that on such date (both before and after giving effect
to the making of any Loans hereunder on such 

 

30

 

date) no Default
or Event of Default has occurred and is continuing, (b) each of the
representations and warranties set forth in Article VI  of this Agreement is true and correct on and
as of such date and (c) that there has been no event or circumstance since
November 30, 2002 which has or could be reasonably expected to have a Material
Adverse Effect.

 

SECTION 5.1.3.  Closing Fees, Expenses, etc.  The Agent shall have received for its own
account and the Lead Arranger all fees, costs and expenses due and payable
pursuant to Sections 3.4.3 and 10.3, if then invoiced.

 

SECTION 5.1.4.  Delivery of Financial Information.  The Agent shall have received, with copies
for each Lender, audited consolidated balance sheets of the Borrower and its
Subsidiaries as at November 30, 2002 and the related statements of earnings and
cash flow, and unaudited balance sheets of the Borrower and its Subsidiaries as
of the end of the Fiscal Quarter ending February 28, 2003 and consolidated
statements of earnings and cash flow of the Borrower and its Subsidiaries for
such Fiscal Quarter, certified by an Authorized Officer of the Borrower.

 

SECTION 5.1.5.  Delivery of Notes.  The Agent shall have received for the
account of each Lender its Note duly executed and delivered by the Borrower
with respect to such Lender’s Commitment.

 

SECTION 5.1.6.  Opinion of Counsel.  The Agent shall have received an opinion of
Robert W. Skelton, General Counsel of the Borrower or any Associate General
Counsel of the Borrower, dated the date of this Agreement and addressed to the
Agent and all Lenders, substantially in the form of Exhibit F hereto.

 

SECTION 5.2.  Conditions Precedent to Borrowings.  The obligation of each Lender to fund any
Loan on the occasion of any Borrowing (including the initial Borrowing) shall
be subject to the satisfaction of each of the conditions precedent set forth in
this Section 5.2.

 

SECTION 5.2.1.  Compliance with Warranties, No Default,
etc.  Both before and after giving
effect to any Borrowing, the following statements shall be true and correct:

 

(a)           the
representations and warranties set forth in Article VI (other than the
representations and warranties set forth in Sections 6.6 and 6.7)
shall be true and correct with the same effect as if then made (unless stated
to relate solely to an earlier date, in which case such representations and
warranties shall be true and correct as of such earlier date); and

 

(b)           no
Default or Event of Default shall have then occurred and be continuing.

 

SECTION 5.2.2.  Borrowing Request.  The Agent shall have received a Borrowing
Request for such Borrowing.  Each of the
delivery of a Borrowing Request and the acceptance by the Borrower of the
proceeds of such Borrowing shall constitute a representation and warranty by
the Borrower that on the date of such Borrowing (both immediately before and
after giving effect to such Borrowing and the application of the proceeds
thereof) the statements made in Section 5.2.1 are true and correct.

 

31

 

SECTION 5.2.3.  Satisfactory Legal Form.  All documents executed or submitted pursuant
hereto by or on behalf of the Borrower shall be reasonably satisfactory in form
and substance to the Agent and its counsel (and the execution of this Agreement
by the Agent shall be deemed to evidence such satisfaction); the Agent and its
counsel shall have received all non-confidential information, approvals,
opinions, documents or instruments as the Agent or its counsel may reasonably
request.

 

ARTICLE VI

 

REPRESENTATIONS AND WARRANTIES

 

In order to induce the Lenders and the Agent to enter
into this Agreement and to make Loans hereunder, the Borrower represents and
warrants as follows as of the Effective Date, and thereafter, as of the date of
each Borrowing to the extent set forth in clause (a) of Section 5.2.1.

 

SECTION 6.1.  Organization, etc.  The Borrower and each of its Subsidiaries is
a corporation, partnership or limited liability company duly organized or
formed, validly existing and in good standing under the laws of the State of
its incorporation or organization, is duly qualified to do business and is in
good standing in each jurisdiction where the nature of its business requires
such qualification, except where the failure to so qualify will not have a
Material Adverse Effect, and has full power and authority and holds all
requisite governmental licenses, permits and other approvals to enter into and
perform its Obligations under this Agreement, the Notes and each other Loan
Document to which it is a party and to own or hold under lease its property and
to conduct its business substantially as currently conducted by it.

 

SECTION 6.2.  Due Authorization, Non-Contravention etc.  The execution, delivery and performance by
the Borrower of this Agreement, the Notes and each other Loan Document executed
or to be executed by it, are within the Borrower’s corporate powers, have been
duly authorized by all necessary corporate action, and do not

 

(a)           contravene
the Borrower’s Organic Documents;

 

(b)           contravene
any contractual restriction, law or governmental regulation or court decree or
order binding on or affecting the Borrower and its Subsidiaries; or

 

(c)           result
in, or require the creation or imposition of, any Lien on any of the Borrower’s
properties.

 

SECTION 6.3.  Government Approval Regulation, etc.  No authorization or approval or other action
by, and no notice to or filing with, any governmental authority or regulatory
body or other Person is required for the due execution, delivery or performance
by the Borrower of this Agreement, the Notes or any other Loan Document.  Neither the Borrower nor any of its
Subsidiaries is an “investment company” within the meaning of the Investment
Company Act of 1940, as amended, or a “holding company”, or a “subsidiary
company” of a “holding company”, or an “affiliate” of a “holding company” or of
a “subsidiary company” of a “holding company”, within the meaning of the Public
Utility Holding Company Act of 1935, as amended.

 

32

 

SECTION 6.4.  Validity, etc.  This Agreement constitutes, and the Notes
and each other Loan Document executed by the Borrower will, on the due
execution and delivery thereof, constitute, the legal, valid and binding
obligations of the Borrower enforceable in accordance with their respective
terms, subject to the effect of bankruptcy insolvency, reorganization,
moratorium or similar laws affecting the enforceability of creditors’ rights
generally and by general principles of equity.

 

SECTION 6.5.  Financial Information.  The consolidated balance sheets of the
Borrower and its Subsidiaries as at November 30, 2002, and the related
consolidated statements of earnings and cash flow of the Borrower and its
Subsidiaries, copies of which have been furnished to the Agent and each Lender,
have been prepared in accordance with GAAP consistently applied, and present
fairly in all material respects the consolidated financial condition of the
Borrower and its Subsidiaries as at the dates thereof and the results of their
operations for the periods then ended.

 

SECTION 6.6.  No Material Adverse Change.  Since the date of the financial statements
described in Section 6.5 (except to the extent the information disclosed
therein is modified or superseded, as the case may be, by information in the
Borrower’s quarterly report on Form 10-Q for the quarter ended February 28,
2003) there has been no material adverse change in the financial condition,
operations, assets, business or properties of the Borrower and its Subsidiaries
taken as a whole.

 

SECTION 6.7.  Litigation, Labor Controversies, etc.  There is no pending or, to the knowledge of
the Borrower, threatened litigation, action, proceeding, or labor controversy
affecting the Borrower or any of its Subsidiaries, or any of their respective
properties, businesses, assets or revenues, which will result in a Material
Adverse Effect or which purports to affect the legality, validity or
enforceability of this Agreement, the Notes or any other Loan Document, except
as disclosed in Item 6.7 (“Litigation”) of the Disclosure Schedule.

 

SECTION 6.8.  Subsidiaries.  The Borrower has no Subsidiaries, except
those Subsidiaries

 

(a)           which
are identified in Item 6.8 (“Existing Subsidiaries as of the Effective
Date”) of the Disclosure Schedule; or

 

(b)           which
are hereafter acquired or formed.

 

It being understood that Subsidiaries may merge,
consolidate, liquidate and sell assets as permitted pursuant to Section
7.2.4.

 

SECTION 6.9.  Ownership of Properties.  The Borrower and each of its Subsidiaries
has good and marketable title to all of its tangible properties and assets,
real and personal, of any nature whatsoever, free and clear of all Liens,
charges or claims except as permitted pursuant to Section 7.2.3 or
Liens, charges or claims that will not have a Material Adverse Effect; and the
Borrower has duly registered in the U.S. all trademarks required for the
conduct of its business in the U.S., other than those as to which the lack of
protection, or failure to register, would not have a Material Adverse Effect.

 

33

 

SECTION 6.10.  Taxes.  The Borrower and each of its Subsidiaries has filed all federal
and all other material income tax returns and reports required by law to have
been filed by it and has paid all taxes and governmental charges thereby shown
to be owing, except any such taxes or charges which are being diligently
contested in good faith by appropriate proceedings and for which adequate reserves
in accordance with GAAP shall have been set aside on its books.

 

SECTION 6.11.  Pension and Welfare Plans.  During the twelve-consecutive-month period
ending immediately prior to the date of the execution and delivery of this
Agreement, no Pension Plan has been terminated, or has been subject to the
commencement of any termination, that could reasonably be expected to have a
Material Adverse Effect, and no contribution failure has occurred with respect
to any Pension Plan sufficient to give rise to a Lien under section 302(f) of
ERISA.  No condition exists or event or
transaction has occurred with respect to any Pension Plan which might result in
the incurrence by the Borrower or any member of the Controlled Group of any
liability, fine or penalty which is likely to have a Material Adverse
Effect.  Except for the post-retirement
benefits described in Item 6.11 (“Employee Benefit Plans”) of the
Disclosure Schedule, the Borrower has no contingent liability with respect to
post-retirement benefits provided by the Borrower and its Subsidiaries under a
Welfare Plan, other than (i) liability for continuation coverage described in
Part 6 of Subtitle B of Title I of ERISA and (ii) liabilities which will not,
individually or in the aggregate, have a Material Adverse Effect.

 

SECTION 6.12.  Environmental Warranties.  Except as set forth in Item 6.12
(“Environmental Matters”) of the Disclosure Schedule:

 

(a)           all
facilities and property (including underlying groundwater) owned or leased by
the Borrower or any of its Subsidiaries have been, and continue to be, owned or
leased by the Borrower and its Subsidiaries in compliance with all
Environmental Laws, except for such non-compliance which, singly or in the
aggregate, will not have a Material Adverse Effect;

 

(b)           there
have been no past unresolved, and there are no pending or threatened (in
writing)

 

(i)            claims,
complaints, notices or requests for information received by the Borrower or any
of its Subsidiaries with respect to any alleged violation of any Environmental
Law, or

 

(ii)           complaints,
written notices or inquiries to the Borrower or any of its Subsidiaries
regarding potential liability under any Environmental Law,

 

which violation or potential liability singly or in
the aggregate will have a Material Adverse Effect;

 

(c)           there
have been no Releases of Hazardous Materials at, on or under any property now
or to the Borrower’s knowledge previously owned or leased by the Borrower or
any of its Subsidiaries that, singly or in the aggregate, have, or will have a
Material Adverse Effect;

 

34

 

(d)           the
Borrower and its Subsidiaries have been issued and are in compliance with all
permits, certificates, approvals, licenses and other authorizations relating to
environmental matters and necessary for their businesses, except for such
permits, approvals, licenses and other authorizations which, if not obtained by
the Borrower, or as to which the Borrower is not in compliance (in each case
singly or in the aggregate), will not have a Material Adverse Effect;

 

(e)           no
property now or, to the Borrower’s knowledge, previously owned or leased by the
Borrower or any of its Subsidiaries is listed or with the knowledge of the
Borrower, proposed for listing (with respect to owned property only) on (i) the
CERCLIS or on any similar state list of sites requiring investigation or
clean-up or (ii) the National Priorities List pursuant to CERCLA; other than
properties as to which any such listing will not result in a Material Adverse
Effect;

 

(f)            there
are no underground storage tanks, active or abandoned, including petroleum
storage tanks, on or under any property now or, to the Borrower’s knowledge,
previously owned or leased by the Borrower or any of its Subsidiaries that,
singly or in the aggregate, have, or will have, a Material Adverse Effect;

 

(g)           to
the Borrower’s knowledge, neither Borrower nor any Subsidiary of the Borrower
has directly transported or directly arranged for the transportation of any
Hazardous Material to any location which is listed or, with the knowledge of
the Borrower, proposed for listing, on the National Priorities List pursuant to
CERCLA, on the CERCLIS or on any similar state list or which is the subject of
federal, state or local enforcement actions or other investigations which will
lead to claims against the Borrower or such Subsidiary thereof for any remedial
work, damage to natural resources or personal injury, including claims under
CERCLA, which will have a Material Adverse Effect; and

 

(h)           there
are no polychlorinated biphenyls or friable asbestos present at any property
owned or leased by the Borrower or any Subsidiary of the Borrower that, singly
or in the aggregate, have, or will have, a Material Adverse Effect.

 

SECTION 6.13.  Regulations U and X.  No proceeds of any Loans will be used for a
purpose which violates, or would be inconsistent with, F.R.S.  Board Regulation U or X.  The Borrower is not engaged in the business
of extending credit for the purpose of purchasing or carrying margin stock, and
not more than 25% of the consolidated assets of the Borrower and its
Subsidiaries consists of margin stock. 
Terms for which meanings are provided in F.R.S.  Board Regulation U or X or any regulations
substituted therefor, as from time to time in effect, are used in this Section
with such meanings.

 

SECTION 6.14.  Accuracy of Information.  Neither this Agreement nor any other
document, certificate or statement furnished to the Agent or any Lender by or
on behalf of the Borrower in connection herewith contains any untrue statement
of a material fact or omits to state a material fact necessary in order to make
the statements contained herein and therein not misleading, in light of the
circumstances under which they were made.

 

35

 

SECTION 6.15.  Compliance with Law; Absence of Default.  The Borrower and its Subsidiaries are in
compliance with all Applicable Laws the noncompliance with which would have a
Material Adverse Effect and with all of the material provisions of their
respective Organic Documents, and no event has occurred or has failed to occur
which has not been remedies or waived, the occurrence or non-occurrence of
which constitutes (i) a Default or Event of Default or (ii) a default by the
Borrower or one of its Subsidiaries under any other material indenture,
agreement or other instrument, or any judgment, decree, or order to which the
Borrower or such Subsidiary is a party or by which the Borrower or such
Subsidiary or any of their respective properties may be bound, which would have
a Material Adverse Effect.

 

ARTICLE VII

 

COVENANTS

 

SECTION 7.1.  Affirmative Covenants.  The Borrower agrees with the Agent and each
Lender that, until all Obligations have been paid and performed in full, the
Borrower will perform the obligations set forth in this Section 7.1.

 

SECTION 7.1.1.  Financial Information Reports, Notices,
etc.  The Borrower will furnish, or
will cause to be furnished, to each Lender and the Agent copies of the
following financial statements, reports, notices and information:

 

(a)           as
soon as available and in any event within 60 days after the end of each of the
first three Fiscal Quarters of each Fiscal Year of the Borrower, a consolidated
balance sheet of the Borrower and its Subsidiaries as of the end of such Fiscal
Quarter and consolidated statements of earnings and cash flow of the Borrower
and its Subsidiaries for such Fiscal Quarter and for the period commencing at
the end of the previous Fiscal Year and ending with the end of such Fiscal
Quarter, certified by an Authorized Officer of the Borrower, it being
understood and agreed that the delivery of the Borrower’s Form 10-Q (as filed
with the Securities and Exchange Commission) shall satisfy the requirements set
forth in this clause);

 

(b)           as
soon as available and in any event within 120 days after the end of each Fiscal
Year of the Borrower, a copy of the annual audit report for such Fiscal Year
for the Borrower and its Subsidiaries, including therein a consolidated balance
sheet of the Borrower and its Subsidiaries as of the end of such Fiscal Year
and consolidated statements of earnings and cash flow of the Borrower and its
Subsidiaries for such Fiscal Year, in each case certified (without any
Impermissible Qualification) in a manner acceptable to the Agent and the
Required Lenders by Ernst & Young or other independent public accountants
reasonably acceptable to the Agent and the Required Lenders (it being
understood and agreed that the delivery of the Borrower’s Form 10-K (as filed
with the Securities and Exchange Commission) shall satisfy such delivery
requirement in this clause), together with a certificate from an Authorized
Officer of the Borrower containing a computation in reasonable detail of, and
showing compliance with, each of the financial ratios and restrictions
contained in Sections 7.2.2, 7.2.3, 7.2.4 and 7.2.5
and to the effect that, in making the examination necessary for the signing of
such certificate, he has not become aware of any Default or Event of Default
that has 

 

36

 

occurred and is
continuing, or, if he has become aware of such Default or Event of Default,
describing such Default or Event of Default and the steps, if any, being taken
to cure it;

 

(c)           as
soon as available and in any event within 60 days after the end of each Fiscal
Quarter, a Compliance Certificate in substantially the form of Exhibit D
hereto, executed by the Treasurer or an Authorized Officer of the Borrower,
showing (in reasonable detail and with appropriate calculations and
computations in all respects satisfactory to the Agent) compliance with the
financial covenants set forth in Sections 7.2.2, 7.2.3, 7.2.4
and 7.2.5 and representing as to the absence of any Default;

 

(d)           as
soon as possible and in any event within three Business Days upon any officer
or director of the Borrower becoming aware of the occurrence of each Default or
Event of Default, a statement of the Treasurer or the chief financial
Authorized Officer of the Borrower setting forth details of such Default or
Event of Default and the action which the Borrower has taken and proposes to
take with respect thereto;

 

(e)           as
soon as possible and in any event within five Business Days after (x) the
occurrence of any adverse development with respect to any litigation, action,
proceeding, or labor controversy described in Section 6.7 which will
result in or is likely to result in a Material Adverse Effect or (y) the
commencement of any labor controversy, litigation, action, proceeding of the
type described in Section 6.7, notice thereof and copies of all
documentation relating thereto;

 

(f)            promptly
after the sending or filing thereof, copies of all reports which the Borrower
sends to any of its security holders, and all reports and registration
statements (other than on Form S-8 or any successor form) which the Borrower or
any of its Subsidiaries files with the Securities and Exchange Commission or
any national securities exchange;

 

(g)           immediately
upon becoming aware of the taking of any specific actions by the Borrower or
any other Person to terminate any Pension Plan (other than a termination
pursuant to Section 4041(b) of ERISA which can be completed without the
Borrower or any Controlled Group member having to provide more than $3,000,000
in addition to the normal contribution required for the plan year in which
termination occurs to make such Pension Plan sufficient), or the failure to
make a required contribution to any Pension Plan if such failure is sufficient
to give rise to a Lien under section 302(f) of ERISA, or the taking of any
action with respect to a Pension Plan which would likely result in the
requirement that the Borrower furnish a bond or other security to the PBGC or
such Pension Plan, or the occurrence of any event with respect to any Pension
Plan which would likely result in the incurrence by the Borrower of any
liability, fine or penalty which will have a Material Adverse Effect, or any
increase in the contingent liability of the Borrower with respect to any
post-retirement Welfare Plan benefit if the increase in such contingent
liability will result in a Material Adverse Effect, notice thereof and copies
of all documentation relating thereto;

 

37

 

(h)           immediately
upon becoming aware of any change in Borrower’s Senior Debt Rating, a statement
describing such change, whether such change was made by S&P, Moody’s or
both and the effective date of such change; and

 

(i)            such
other non-confidential information respecting the condition or operations, financial
or otherwise, of the Borrower or any of its Subsidiaries as any Lender through
the Agent may from time to time reasonably request.

 

SECTION 7.1.2.  Compliance with Laws, etc.  The Borrower will, and will cause each of
its Subsidiaries to, comply in all respects with all Applicable Laws, except
where such non-compliance would not have a Material Adverse Effect, such
compliance to include (without limitation):

 

(a)           preserve,
renew and maintain in full force and effect its legal existence and good standing
under the Applicable Laws of the jurisdiction of its organization and each
jurisdiction where its conduct of business requires qualification or good
standing (except any Subsidiary may merge, consolidate or liquidate as
permitted pursuant to Section 7.2.4), and

 

(b)           the
payment, before the same become delinquent, of all taxes, assessments and
governmental charges imposed upon it or upon its property except to the extent
being diligently contested in good faith by appropriate proceedings and for
which adequate reserves in accordance with GAAP shall have been set aside on
its books.

 

SECTION 7.1.3.  Maintenance of Properties.  The Borrower will, and will cause each of
its Subsidiaries to, maintain, preserve, protect and keep its material
properties in good repair, working order and condition, and make necessary and
proper repairs, renewals and replacements so that its business carried on in
connection therewith may be properly conducted at all times unless the Borrower
determines in good faith that the continued maintenance of any of its
properties is no longer economically desirable.

 

SECTION 7.1.4.  Insurance.  The Borrower will, and will cause each of its Subsidiaries to,
maintain or cause to be maintained with responsible insurance companies
insurance with respect to its properties material to the business of the
Borrower and its Subsidiaries against such casualties and contingencies and of
such types and in such amounts as is customary in the case of similar
businesses and will, upon request of the Agent, furnish to each Lender at
reasonable intervals a certificate of an Authorized Officer of the Borrower
setting forth the nature and extent of all insurance maintained by the Borrower
and its Subsidiaries in accordance with this Section, provided, that the
Borrower and its Subsidiaries may self-insure to the extent customary for
similarly situated corporations engaged in the same or similar business.

 

SECTION 7.1.5.  Books and Records.  The Borrower will, and will cause each of
its Subsidiaries to, keep books and records which accurately reflect all of its
business affairs and material transactions and permit the Agent and each Lender
or any of their respective representatives, at reasonable times and intervals,
to visit all of its offices, to discuss its non-confidential financial matters
with its officers and independent public accountant and, upon the 

 

38

 

reasonable request
of the Agent or a Lender, to examine (and, at the expense of the Lenders,
photocopy extracts from) any of its non-confidential books or other corporate
records.

 

SECTION 7.1.6.  Environmental Covenant.  The Borrower will, and will cause each of
its Subsidiaries to,

 

(a)           use
and operate all of its facilities and properties in compliance with all
Environmental Laws except for such non-compliance which, singly or in the
aggregate, will not have a Material Adverse Effect, keep all necessary permits,
approvals, certificates, licenses and other authorizations relating to
environmental matters in effect and remain in compliance therewith, except
where the failure to keep such permits, approvals, certificates, licenses or
other authorizations, or any non-compliance with the provisions thereof will
not have a Material Adverse Effect, and handle all Hazardous Materials in
compliance with all applicable Environmental Laws, except for any
non-compliance that will not have a Material Adverse Effect;

 

(b)           immediately
notify the Agent and provide copies upon receipt of all written inquiries from
any local, state or federal governmental agency, claims, complaints or notices
relating to the condition of its facilities and properties or compliance with
Environmental Laws which will have a Material Adverse Effect, and shall
promptly cure and have dismissed with prejudice or contest in good faith any
actions and proceedings relating to material compliance with Environmental Laws
the result of which, if not contested by the Borrower, would have a Material
Adverse Effect; and

 

(c)           provide
such non-confidential information and certifications which the Agent may
reasonably request from time to time to evidence compliance with this Section
7.1.6.

 

SECTION 7.2.  Negative Covenants.  The Borrower agrees with the Agent and each
Lender that, until all Obligations have been paid and performed in full, the
Borrower will perform the obligations set forth in this Section 7.2.

 

SECTION 7.2.1.  Transactions with Affiliates.  The Borrower will not, and will not permit
any of its Subsidiaries to, enter into, or cause, suffer or permit to exist any
material arrangement or contract with any of its other Affiliates (other than
other Subsidiaries) unless such arrangement or contract is fair and equitable
to the Borrower or such Subsidiary based upon the good faith judgment of the Borrower’s
Board of Directors.

 

SECTION 7.2.2.  Indebtedness.  The Borrower will not permit any of its
Subsidiaries to create, incur, assume or suffer to exist or otherwise become or
be liable in respect of any Indebtedness if, after giving effect to the incurrence
of any such Indebtedness, the aggregate outstanding amount of Indebtedness of
all Subsidiaries would exceed 25% of Consolidated Net Tangible Assets.

 

SECTION 7.2.3.  Liens.  The Borrower will not, and will not permit any of its
Subsidiaries to, create, incur, assume or suffer to exist any Lien upon any of
its property, revenues or assets, whether now owned or hereafter acquired,
except:

 

39

 

(a)           Liens
securing payment of Indebtedness permitted under Section 7.2.2;

 

(b)           Liens
granted prior to June 19, 2001 which are identified in Item 7.2.3
(“Existing Liens”) of the Disclosure Schedule;

 

(c)           any
Lien existing on the assets of any Person at the time it becomes a Subsidiary
(and not created, assumed or incurred by such Person in contemplation of such
event);

 

(d)           Liens
for taxes, assessments or other governmental charges or levies not at the time
delinquent or thereafter payable without penalty or being diligently contested
in good faith by appropriate proceedings and for which adequate reserves in
accordance with GAAP shall have been set aside on its books;

 

(e)           Liens
of carriers, warehousemen, mechanics, materialmen and landlords incurred in the
ordinary course of business for sums not overdue or being diligently contested
in good faith by appropriate proceedings and for which adequate reserves in
accordance with GAAP shall have been set aside on its books;

 

(f)            Liens
incurred in the ordinary course of business in connection with workmen’s
compensation, unemployment insurance or other forms of governmental insurance
or benefits, or to secure performance of tenders, statutory obligations, leases
and contracts (other than for borrowed money) entered into in the ordinary
course of business or to secure obligations on surety or appeal bonds;

 

(g)           judgment
Liens in existence less than 30 days after the entry thereof or with respect to
which execution has been stayed or the payment of which is covered in full
(subject to a customary deductible) by insurance maintained with responsible
insurance companies;

 

(h)           other
Liens incidental to the conduct of the Borrower’s or any of its Subsidiaries’
businesses (including without limitation, Liens on goods securing trade letters
of credit issued in respect of the importation of goods in the ordinary course
of business, or the ownership of any of the Borrower’s or any Subsidiary’s
property and assets which were not incurred in connection with the borrowing of
money or the obtaining of advances or credit and which do not in the aggregate
materially detract from the value of the Borrower’s or any of its Subsidiaries’
property or assets or materially impair the use thereof in the operation of
Borrower’s or any of its Subsidiaries’ businesses);

 

(i)            Liens
in favor of the Borrower on assets of its Subsidiaries, and Liens in favor of
Subsidiaries of the Borrower on assets of the Borrower;

 

(j)            Liens
securing industrial development or pollution control bonds so long as such
Liens attach solely to the property acquired, constructed or improved with the
proceeds of such bonds; and

 

40

 

(k)           any
Lien not otherwise permitted by this Section 7.2.3 securing
Indebtedness, provided  that, immediately after giving effect
thereto (and to the incurrence of such Indebtedness secured thereby), the sum
of (without duplication and excluding any Indebtedness payable to the Borrower
or a Subsidiary) (i) the aggregate outstanding amount of Indebtedness of the
Borrower and its Subsidiaries secured by all Liens described in clauses (b),
(c) and (k) of this Section 7.2.3 (excluding any such
Liens described in clauses (d) through (j) of this Section
7.2.3) and (ii) the Attributable Value of all Sale-Leaseback Transactions
entered into by the Borrower and its Subsidiaries in the aggregate does not
exceed 15% of Consolidated Net Tangible Assets.

 

SECTION 7.2.4.  Mergers, Asset Dispositions, etc.  The Borrower will not, nor will it permit
any of its Subsidiaries to, liquidate, dissolve or enter into any consolidation,
merger, joint venture or any other combination or sell, lease, assign, transfer
or otherwise dispose of any assets or stock, whether now owned or hereafter
acquired, in a single transaction or in a series of transactions other than:

 

(a)           sales
of inventory in the ordinary course of business;

 

(b)           the
merger or consolidation of any Subsidiary with or into the Borrower or a
wholly-owned Subsidiary;

 

(c)           the
merger or consolidation of any other Person with or into the Borrower or any
Subsidiary, so long as, after giving effect thereto, (i) the Borrower or its
Subsidiary, as the case may be, is the surviving entity and (ii) no Default or
Event of Default would exist;

 

(d)           sales
of assets or stock by the Borrower or a Subsidiary to a wholly-owned Subsidiary
or the Borrower; and

 

(e)           (i)
sales of assets or stock to any other Person or (ii) liquidations of
Subsidiaries (other than a Principal Subsidiary) if, after giving effect
thereto, the aggregate book value of such assets or stock disposed of or
liquidated does not, during the most recent period of 12 consecutive months,
exceed 20% of Consolidated Net Tangible Assets as at the end of the Borrower’s
immediately preceding Fiscal Year; and

 

(f)            joint
ventures between Subsidiaries, between one or more Subsidiaries and the
Borrower, between the Borrower and other Persons and between Subsidiaries and
other Persons.

 

SECTION 7.2.5.  EBIT to Interest Expense Ratio.  The Borrower will not permit the ratio of
EBIT to Interest Expense to be less than 2.5:1.00.  For purposes of calculating such ratio, the items included
therein shall be measured on a consolidated basis for the Borrower and its
Subsidiaries for the four full Fiscal Quarters immediately preceding the date
of calculation.

 

41

 

ARTICLE VIII

 

EVENTS OF DEFAULT

 

SECTION 8.1.  Listing of Events of Default.  Each of the following events or occurrences
described in this Section 8.1 shall constitute an “Event of Default”.

 

SECTION 8.1.1.  Non-Payment of Obligations.  The Borrower shall default in the payment
when due of any principal of any Loan, or the Borrower shall default (and such
default shall continue unremedied for a period of three Business Days) in the
payment when due of any interest on any Loan, or the Borrower shall default
after notice (including, without limitation, notice delivered by way of
submission of a detailed invoice) (and such default shall continue unremedied
for a period of five days) in the payment when due of any fee described in Section
3.4 or of any other Obligation, including, without limitation, fees
described in the Transaction Fee Letter.

 

SECTION 8.1.2.  Breach of Warranty.  Any representation or warranty of the
Borrower made or deemed to be made hereunder or in any other Loan Document or
any other writing or certificate furnished by or on behalf of the Borrower to
the Agent or any Lender for the purposes of or in connection with this
Agreement or any such other Loan Document (including any certificates delivered
pursuant to Article V) is or shall be incorrect when made in any
material respect.

 

SECTION 8.1.3.  Non-Performance of Certain Covenants and
Obligations.  The Borrower shall
default in the due performance and observance of any of its obligations under clause
(a) of Section 7.1.2 (with respect to the maintenance and
preservation of the Borrower’s corporate existence) or under Section 7.1.6,
or the Borrower shall default in the due performance and observance of its
obligations under Section 7.2, and such default (if capable of being remedied
within such period) shall not be remedied within five Business Days after any
officer of the Borrower obtains actual knowledge thereof.

 

SECTION 8.1.4.  Non-Performance of Other Covenants and
Obligations.  The Borrower shall
default in the due performance and observance of any other agreement contained
herein or in any other Loan Document, and such default shall continue
unremedied for a period of 30 days after notice thereof shall have been given
to the Borrower by the Agent or any Lender.

 

SECTION 8.1.5.  Default on Other Indebtedness.  A default shall occur in the payment when
due (subject to any applicable grace period), whether by acceleration or
otherwise, of any Indebtedness (other than Indebtedness described in Section
8.1.1) of the Borrower or any of its Subsidiaries having a principal
amount, individually or in the aggregate, in excess of $15,000,000, or a
default shall occur in the performance or observance of any obligation or
condition with respect to such Indebtedness (whether or not waived) if the
effect of such default is to accelerate the maturity of any such Indebtedness
or such default (whether or not waived) shall continue unremedied for any
applicable period of time sufficient to permit the holder or holders of such
Indebtedness, or any trustee or agent for such holders, to cause such
Indebtedness to become due and payable prior to its expressed maturity.

 

42

 

SECTION 8.1.6.  Judgments.  Any judgment or order for the payment of money in excess of
$15,000,000 shall be rendered against the Borrower or any of its Subsidiaries
and either

 

(a)           enforcement
proceedings shall have been commenced by any creditor upon such judgment or
order; or

 

(b)           there
shall be any period of 30 consecutive days during which a stay of enforcement
of such judgment or order, by reason of a pending appeal or otherwise, shall
not be in effect.

 

SECTION 8.1.7.  Pension Plans.  Any of the following events shall occur with
respect to any Pension Plan

 

(a)           the
institution of any steps by the Borrower, any member of its Controlled Group or
any other Person to terminate a Pension Plan if, as a result of such
termination, the Borrower or any such member could reasonably be required to
make a contribution to such Pension Plan, or could reasonably expect to incur a
liability or obligation to such Pension Plan, in excess of $5,000,000; or

 

(b)           a
contribution failure occurs with respect to any Pension Plan sufficient to give
rise to a Lien under Section 302(f) of ERISA which is not cured within 20 days
from the date such contribution was due.

 

SECTION 8.1.8.  Control of the Borrower.  Any Change in Control shall occur.

 

SECTION 8.1.9.  Bankruptcy, Insolvency, etc.  The Borrower or any of its Subsidiaries that
are Principal Subsidiaries shall

 

(a)           become
insolvent or generally fail to pay, or admit in writing its inability to pay,
debts as they become due;

 

(b)           apply
for, consent to, or acquiesce in, the appointment of a trustee, receiver,
sequestrator or other custodian for the Borrower or any of such Subsidiaries or
a substantial part of any property of any thereof, or make a general assignment
for the benefit of creditors;

 

(c)           in
the absence of such application, consent or acquiescence, permit or suffer to
exist the appointment of a trustee, receiver, sequestrator or other custodian
for the Borrower or any of such Subsidiaries or  for a substantial part of the property of any thereof, and such
trustee, receiver, sequestrator or other custodian shall not be discharged
within 60 days,  provided that the
Borrower and each such Subsidiary 
hereby expressly authorizes the Agent and each Lender to appear in any
court conducting any relevant proceeding during such 60-day period to preserve,
protect and defend their rights under the Loan Documents;

 

(d)           permit
or suffer to exist the commencement of any bankruptcy, reorganization, debt
arrangement or other case or proceeding under any bankruptcy or insolvency law,
or any dissolution, winding up or liquidation proceeding, in respect of the 

 

43

 

Borrower or any of
such Subsidiaries, and, if any such case or proceeding is not commenced by the
Borrower or such Subsidiary, such case or proceeding shall be consented to or
acquiesced in by the Borrower or such Subsidiary or shall result in the entry
of an order for relief or shall remain for 60 days undismissed, provided that
the Borrower and each such Subsidiary hereby expressly authorizes the Agent and
each Lender to appear in any court conducting any such case or proceeding
during such 60-day period to preserve, protect and defend their rights under
the Loan Documents; or

 

(e)           take
any corporate action authorizing, or in furtherance of, any of the foregoing.

 

SECTION 8.2.  Action if Bankruptcy.  If any Event of Default described in clauses
(a) through (e) of Section 8.1.9 shall occur, the Commitments
(if not theretofore terminated) shall automatically terminate and the
outstanding principal amount of all outstanding Loans and all other Obligations
shall automatically be and become immediately due and payable, without notice
or demand.

 

SECTION 8.3.  Action if Other Event of Default.  If any Event of Default (other than any
Event of Default described in clauses (a) through (e) of Section
8.1.9) shall occur for any reason, whether voluntary or involuntary, and be
continuing, the Agent, upon the direction of the Required Lenders, shall by
notice to the Borrower declare all or any portion of the outstanding principal
amount of the Loans and other Obligations to be due and payable and/or the
Commitments (if not theretofore terminated) to be terminated, whereupon the
full unpaid amount of such Loans and other Obligations which shall be so
declared due and payable shall be and become immediately due and payable,
without further notice, demand or presentment and/or, as the case may be, the
Commitments shall terminate.

 

ARTICLE IX

 

THE AGENT

 

SECTION 9.1.  Appointment; Powers and Immunities.  Each Lender hereby irrevocably appoints and
authorizes the Agent to act as its Agent hereunder and under the other Loan
Documents with such powers as are specifically delegated to the Agent by the
terms hereof and thereof, together with such other powers as are reasonably
incidental thereto.  The Agent:  (a) shall have no duties or
responsibilities except as expressly set forth in this Agreement and the other
Loan Documents, and shall not by reason of this Agreement or any other Loan
Document be a trustee for any Lender; (b) makes no warranty or
representation to any Lender and shall not be responsible to the Lenders for
any recitals, statements, representations or warranties contained in this
Agreement or any other Loan Document, or in any certificate or other document
referred to or provided for in, or received by any Lender under, this Agreement
or any other Loan Document, or for the validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Loan Document or
any other document referred to or provided for herein or therein or for any failure
by the Borrower to perform any of its obligations hereunder or thereunder;
(c) shall not be required to initiate or conduct any litigation or
collection proceedings hereunder or under any other Loan Document except to the
extent requested by the Required Lenders, and then only on terms and conditions
satisfactory to the Agent, and (d) shall not be 

 

44

 

responsible for
any action taken or omitted to be taken by it hereunder or under any other Loan
Document or any other document or instrument referred to or provided for herein
or therein or in connection herewith or therewith, except for its own gross
negligence or willful misconduct.  The
Agent may employ agents and attorneys-in-fact and shall not be responsible for
the negligence or misconduct of any such agents or attorneys-in-fact selected
by it with reasonable care.  The
provisions of this Article IX are solely for the benefit of the
Agent and the Lenders, and the Borrower shall not have any rights as a third
party beneficiary of any of the provisions hereof.  In performing its functions and duties under this Agreement and
under the other Loan Documents, the Agent shall act solely as Agent of the
Lenders and does not assume and shall not be deemed to have assumed any
obligation towards or relationship of agency or trust with or for the
Borrower.  The duties of the Agent shall
be ministerial and administrative in nature, and the Agent shall not have by
reason of this Agreement or any other Loan Document a fiduciary relationship in
respect of any Lender.

 

SECTION 9.2.  Reliance by Agent.  The Agent shall be entitled to rely upon any
certification, notice or other communication (including any thereof by
telephone, telecopier, telegram or cable) believed by it to be genuine and
correct and to have been signed or sent by or on behalf of the proper Person or
Persons, and upon advice and statements of legal counsel, independent
accountants or other experts selected by the Agent.  As to any matters not expressly provided for by this Agreement or
any other Loan Document, the Agent shall in all cases be fully protected in
acting, or in refraining from acting, hereunder and thereunder in accordance
with instructions signed by the Required Lenders, and such instructions of the
Required Lenders in any action taken or failure to act pursuant thereto shall
be binding on all of the Lenders.

 

SECTION 9.3.  Defaults.  The Agent shall not be deemed to have knowledge of the occurrence
of a Default or an Event of Default (other than the nonpayment of principal of
or interest on the Loans) unless the Agent has received notice from a Lender or
the Borrower specifying such Default or Event of Default and stating that such
notice is a “Notice of Default”.  In the
event that the Agent receives such a notice of the occurrence of a Default or
an Event of Default, the Agent shall give prompt notice thereof to the
Lenders.  The Agent shall (subject to Section 10.1)
take such action hereunder with respect to such Default or Event of Default as
shall be directed by the Required Lenders, provided that, unless and
until the Agent shall have received such directions, the Agent may (but shall
not be obligated to) take such action, or refrain from taking such action, with
respect to such Default or Event of Default as it shall deem advisable in the
best interests of the Lenders.

 

SECTION 9.4.  Rights of Agent and its Affiliates as a
Lender.  With respect to its
Commitment and the Loans made by it and any of its Affiliates, Wachovia Bank,
National Association (and any successor acting as Agent hereunder) in its
capacity as a Lender hereunder and any Affiliate of Wachovia Bank, National
Association in its capacity as a Lender hereunder shall have the same rights
and powers hereunder as any other Lender and may exercise the same as though it
were not acting as the Agent, and the term “Lender” or “Lenders” shall, unless
the context otherwise indicates, include Wachovia Bank, National Association in
its individual capacity and any Affiliate of the Agent in its individual
capacity.  Wachovia Bank, National
Association (and any successor acting as Agent hereunder) and any Affiliate
thereof may (without having to account therefor to any Lender) accept deposits
from, lend money to and generally engage in any kind of banking, trust or other
business with the Borrower (and any of 

 

45

 

the Borrower’s
Affiliates) as if it were not acting as the Agent, and Wachovia Bank, National
Association and any Affiliate thereof may accept fees and other consideration
from the Borrower or any Subsidiary or Affiliate thereof for services in
connection with this Agreement or any other Loan Document or otherwise without
having to account for the same to the Lenders.

 

SECTION 9.5.
 Indemnification.  Each Lender severally agrees to indemnify
the Agent, to the extent the Agent shall not have been reimbursed by the
Borrower, ratably in accordance with its Commitment, for any and all
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses (including, without limitation, counsel fees and
disbursements) or disbursements of any kind and nature whatsoever which may be
imposed on, incurred by or asserted against the Agent in any way relating to or
arising out of this Agreement or any other Loan Document or any other documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby (including, without limitation, the costs and
expenses that the Borrower is obligated to pay under Section 10.3
or any amount the Borrower is obligated to pay under Section 10.4,
but excluding the normal administrative costs and expenses incident to the
performance of its agency duties hereunder) or the enforcement of any of the
terms hereof or thereof or any such other documents; provided that no
Lender shall be liable for any of the foregoing to the extent they arise from
the gross negligence or willful misconduct of the Agent.  If any indemnity furnished to the Agent for
any purpose shall, in the opinion of the Agent, be insufficient or become
impaired, the Agent may call for additional indemnity and cease, or not
commence, to do the acts indemnified against until such additional indemnity is
furnished.

 

SECTION 9.6.  Consequential Damages.  THE AGENT SHALL NOT BE RESPONSIBLE OR LIABLE
TO ANY LENDER, THE BORROWER OR ANY OTHER PERSON OR ENTITY FOR ANY PUNITIVE,
EXEMPLARY OR CONSEQUENTIAL DAMAGES WHICH MAY BE ALLEGED AS A RESULT OF THIS
AGREEMENT, THE OTHER LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY.

 

SECTION 9.7.  Registered Holder of Loan Treated as
Owner.  The Agent may deem and treat
each Person in whose name a Loan is registered as the owner thereof for all
purposes hereof unless and until a written notice of the assignment or transfer
thereof shall have been filed with the Agent and the provisions of Section 10.11.1
have been satisfied.  Any requests,
authority or consent of any Person who at the time of making such request or
giving such authority or consent is the holder of any Note shall be conclusive
and binding on any subsequent holder, transferee or assignee of that Note or of
any Note or Notes issued in exchange therefor or replacement thereof.

 

SECTION 9.8.  Nonreliance on Agent and Other Lenders.  Each Lender agrees that it has,
independently and without reliance on the Agent or any other Lender, and based
on such documents and information as it has deemed appropriate, made its own
credit analysis of the Borrower and decision to enter into this Agreement and
that it will, independently and without reliance upon the Agent or any other
Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own analysis and decisions in
taking or not taking action under this Agreement or any of the other Loan
Documents.  The Agent shall not be
required to keep itself (or any Lender) informed as to the performance or
observance by 

 

46

 

the Borrower of
this Agreement or any of the other Loan Documents or any other document
referred to or provided for herein or therein or to inspect the properties or
books of the Borrower or any other Person. 
Except for notices, reports and other documents and information expressly
required to be furnished to the Lenders by the Agent hereunder or under the
other Loan Documents, the Agent shall not have any duty or responsibility to
provide any Lender with any credit or other information concerning the affairs,
financial condition or business of the Borrower or any other Person (or any of
their Affiliates) which may come into the possession of the Agent or any of its
Affiliates.

 

SECTION 9.9.  Failure to Act.  Except for action expressly required of the
Agent hereunder or under the other Loan Documents, the Agent shall in all cases
be fully justified in failing or refusing to act hereunder and thereunder
unless it shall receive further assurances to its satisfaction by the Lenders
of their indemnification obligations under Section 9.5 against any
and all liability and expense which may be incurred by the Agent by reason of
taking, continuing to take, or failing to take any such action.

 

SECTION 9.10.  Successor Agent.  The Agent may resign at any time by giving
notice thereof to the Lenders and the Borrower.  Upon any such resignation, the Required Lenders shall have the
right to appoint a successor Agent.  If
no successor Agent shall have been so appointed by the Required Lenders and
shall have accepted such appointment within 30 days after the retiring Agent’s
notice of resignation, then the retiring Agent may, on behalf of the Lenders,
appoint a successor Agent.  Any
successor Agent shall be a bank or other financial institution which has a combined
capital and surplus of at least $500,000,000. 
Upon the acceptance of any appointment as Agent hereunder by a successor
Agent, such successor Agent shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Agent, and the
retiring Agent shall be discharged from its duties and obligations
hereunder.  After any retiring Agent’s
resignation hereunder as Agent, the provisions of this Article IX
shall continue in effect for its benefit in respect of any actions taken or
omitted to be taken by it while it was acting as the Agent hereunder.

 

ARTICLE X

 

MISCELLANEOUS PROVISIONS

 

SECTION 10.1.  Waivers, Amendments, etc.  The provisions of this Agreement and of each
other Loan Document may from time to time be amended, modified or waived, if
such amendment, modification or waiver is in writing and consented to by the
Borrower and the Required Lenders; provided,  however, that no
such amendment, modification or waiver which would:

 

(a)           modify
any requirement hereunder that any particular action be taken by all the
Lenders or by the Required Lenders shall be effective unless consented to by
each Lender;

 

(b)           modify
this Section 10.1, change the definition of “Required Lenders”,
increase the Percentage or Commitment of any Lender, reduce any fees described
in 

 

47

 

Article III,
or extend the Maturity Date shall be made without the consent of each Lender
and each holder of a Note;

 

(c)           extend
the due date for, or reduce the amount of, any scheduled repayment of principal
of or payment of interest on any Loan or fees owed hereunder (or reduce the
principal amount of or rate of interest on any Loan or the fees owed hereunder)
shall be made without the consent of the holder of that Note evidencing such
Loan or owed such fees; or

 

(d)           affect
adversely the interests, rights or obligations of the Agent qua the
Agent shall be made without consent of the Agent.

 

No failure or delay on
the part of the Agent, any Lender or the holder of any Note in exercising any
power or right under this Agreement or any other Loan Document shall operate as
a waiver thereof, nor shall any single or partial exercise of any such power or
right preclude any other or further exercise thereof or the exercise of any
other power or right.  No notice to or
demand on the Borrower in any case shall entitle it to any notice or demand in
similar or other circumstances.  No
waiver or approval by the Agent, any Lender or the holder of any Note under
this Agreement or any other Loan Document shall, except as may be otherwise
stated in such waiver or approval, be applicable to subsequent
transactions.  No waiver or approval
hereunder shall require any similar or dissimilar waiver or approval thereafter
to be granted hereunder.

 

SECTION 10.2.  Notices.  All notices and other communications provided to any party hereto
under this Agreement or any other Loan Document shall be in writing or by
facsimile and addressed, delivered or transmitted to such party at its address
or facsimile number set forth below its signature hereto or set forth in the
Lender Assignment Agreement or at such other address or facsimile number as may
be designated by such party in a notice to the other parties.  Any notice, if mailed and properly addressed
with postage prepaid or if properly addressed and sent by pre-paid courier
service, shall be deemed given when received; any notice, if transmitted by
facsimile, shall be deemed given when transmitted.

 

SECTION 10.3.  Payment of Costs and Expenses.  The Borrower agrees to pay on demand all
reasonable expenses of the Agent and the Lead Arranger (including the
reasonable fees, internal charges and out-of-pocket expenses of counsel to the
Agent and the Lead Arranger, which attorneys may be employees of the Agent or
Lead Arranger, and of local counsel, if any, who may be retained by counsel to
the Agent and the Lead Arranger) in connection with

 

(a)           the
negotiation, preparation, syndication, due diligence, execution and delivery of
this Agreement and of each other Loan Document, including schedules and
exhibits, and any amendments, waivers, consents, supplements or other
modifications to this Agreement or any other Loan Document as may from time to
time hereafter be required, whether or not the transactions contemplated hereby
are consummated, and

 

(b)           the
preparation and review of the form of any document or instrument relevant to
this Agreement or any other Loan Document;

 

48

 

provided,
however, that the Borrower shall not be obligated to pay for expenses
incurred by the Agent or a Lender in connection with the assignment of Loans to
an Assignee Lender pursuant to Section 10.11.1 or the sale of Loans to a
Participant pursuant to Section 10.11.2.

 

The Borrower further agrees to pay, and to save the
Agent and the Lenders harmless from all liability for, any stamp or other taxes
which may be payable in connection with the execution or delivery of this
Agreement, the borrowings hereunder, or the issuance of the Notes or any other
Loan Documents.  The Borrower also
agrees to reimburse the Agent and each Lender upon demand for all reasonable
out-of-pocket expenses (including attorneys’ fees and legal expenses, and the
allocated costs of staff counsel) incurred by the Agent or such Lender in
connection with (x) the negotiation of any restructuring or “work-out”, whether
or not consummated, of any Obligations and (y) the enforcement of any
Obligations.

 

SECTION 10.4.  Indemnification.  In consideration of the execution and
delivery of this Agreement by each Lender and the extension of Commitments, the
Borrower hereby indemnifies, exonerates and holds the Agent, the Lead Arranger
and each Lender and each of their respective officers, directors, employees and
agents (collectively, the “Indemnified Parties”) free and harmless from
and against any and all actions, causes of action, suits, losses, costs,
liabilities and damages, and expenses incurred in connection therewith
(irrespective of whether any such Indemnified Party is a party to the action
for which indemnification hereunder is sought), including reasonable attorneys’
fees and disbursements (collectively, the “Indemnified Liabilities”) ,
incurred by the Indemnified Parties or any of them as a result of, or arising
out of, or relating to

 

(a)           any
transaction financed or to be financed in whole or in part, directly or
indirectly, with the proceeds of any Loan;

 

(b)           the
entering into and performance of this Agreement and any other Loan Document by
any of the Indemnified Parties;

 

(c)           any
investigation, litigation or proceeding related to any acquisition or proposed
acquisition by the Borrower or any of its Subsidiaries of all or any portion of
the stock or assets of any Person, whether or not the Agent, the Lead Arranger
or such Lender is party thereto;

 

(d)           any
investigation, litigation or proceeding related to any environmental cleanup,
audit, compliance or other matter relating to the protection of the environment
or the Release by the Borrower or any of its Subsidiaries of any Hazardous
Material; or

 

(e)           the
presence on or under, or the escape, seepage, leakage, spillage, discharge,
emission, discharging or releases from, any real property owned or operated by
the Borrower or any Subsidiary thereof of any Hazardous Material (including any
losses, liabilities, damages, injuries, costs, expenses or claims asserted or
arising under any Environmental Law), regardless of whether caused by, or
within the control of, the Borrower or such Subsidiary,

 

except for any such
Indemnified Liabilities arising by reason of the relevant Indemnified Party’s
gross negligence or willful misconduct. 
If and to the extent that the foregoing undertaking may 

 

49

 

be unenforceable for any
reason, the Borrower hereby agrees to make the maximum contribution to the
payment and satisfaction of each of the Indemnified Liabilities which is
permissible under applicable law.

 

SECTION 10.5.  Survival.  The obligations of the Borrower under Sections 4.3, 4.4,
4.5, 4.6, 10.3 and 10.4, and the obligations of the
Lenders under Section 9.1, shall in each case survive any termination of
this Agreement and the payment in full of all Obligations and the termination
of all Commitments.  The representations
and warranties made by the Borrower in this Agreement and in each other Loan
Document shall survive the execution and delivery of this Agreement and each
such other Loan Document.

 

SECTION 10.6.  Severability.  Any provision of this Agreement or any other
Loan Document which is prohibited or unenforceable in any jurisdiction shall,
as to such provision and such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions of this Agreement or such Loan Document or affecting the validity or
enforceability of such provision in any other jurisdiction.

 

SECTION 10.7.  Headings.  The various headings of this Agreement and of each other Loan
Document are inserted for convenience only and shall not affect the meaning or
interpretation of this Agreement or such other Loan Document or any provisions
hereof or thereof.

 

SECTION 10.8.  Execution in Counterparts, Effectiveness,
etc.  This Agreement may be executed
by the parties hereto in several counterparts, each of which shall be executed
by the Borrower and the Agent and shall be deemed to be an original and all of
which shall constitute together but one and the same Agreement.  This Agreement shall become effective when
counterparts hereof executed on behalf of the Borrower and each Lender (or notice
thereof satisfactory to the Agent) shall have been received by the Agent and
notice thereof shall have been given by the Agent to the Borrower and each
Lender.

 

SECTION 10.9.  Governing Law; Entire Agreement.  THIS AGREEMENT, THE NOTES AND EACH OTHER LOAN DOCUMENT
SHALL EACH BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL
LAWS OF THE STATE OF NEW YORK. 
This Agreement, the Notes and the other Loan Documents constitute the
entire understanding among the parties hereto with respect to the subject
matter hereof and supersede any prior agreements, written or oral, with respect
thereto.

 

SECTION 10.10.  Successors and Assigns.  This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective successors
and assigns; provided,  however, that:

 

(a)           the
Borrower may not assign or transfer its rights or obligations hereunder without
the prior written consent of the Agent and all Lenders; and

 

(b)           the
rights of sale, assignment and transfer of the Lenders are subject to Section
10.11.

 

50

 

SECTION 10.11. 
Sale and Transfer of Loans and Note; Participations in Loans and Note.  Each Lender may assign, or sell
participations in, its Loans and Commitments to one or more other Persons in
accordance with this Section 10.11.

 

SECTION 10.11.1.  Assignments.  Any Lender,

 

(a)           with the written
consent of the Borrower and the Agent (which consent shall not be unreasonably
delayed or withheld, and which consent, in the case of the Borrower, shall be
deemed to have been given if the Borrower fails to deliver a written notice to
the Agent on or before the tenth Business Day after receipt by the Borrower of
the Agent’s request for consent, stating, in reasonable detail, the reasons why
the Borrower proposes to withhold such consent) may at any time assign and
delegate to other commercial banks, other financial institutions or Approved
Funds its Loans and Commitments hereunder; provided,  however,
that if an Event of Default has occurred and is continuing, the consent of the
Borrower shall not be required; and

 

(b)           with notice to the
Borrower and the Agent, but without the consent of the Borrower or the Agent,
may assign and delegate to any of its Affiliates or to any other Lender or its
Affiliates all or any portion of its Loans and Commitments hereunder;

 

(each Person described in
either of the foregoing clauses as being the Person to whom such assignment and
delegation is to be made, being hereinafter referred to as an “Assignee
Lender”), in a minimum aggregate amount of $10,000,000 (or such lesser
amount as may be agreed to by the Borrower and the Agent, at their option) in
the case of clause (a) above, and all of the Loans and Commitments of
such Assignee Lender in the case of clause (b) above; provided,  however,
that any such Assignee Lender will comply, if applicable, with the provisions
contained in the last sentence of Section 4.6 and further, provided,
however, that, the Borrower and the Agent shall be entitled to continue
to deal solely and directly with such Lender in connection with the interests
so assigned and delegated to an Assignee Lender until:

 

(i)            written notice of such
assignment and delegation, together with payment instructions, addresses and
related information with respect to such Assignee Lender, shall have been given
to the Borrower and the Agent by such Lender and such Assignee Lender;

 

(ii)           such Assignee Lender
shall have executed and delivered to the Borrower and the Agent a Lender
Assignment Agreement, accepted by the Agent; and

 

(iii)          the processing fees
described below shall have been paid.

 

From and after the date that the Agent accepts such
Lender Assignment Agreement, (x) the Assignee Lender thereunder shall be deemed
automatically to have become a party hereto and to the extent that rights and
obligations hereunder have been assigned and delegated to such Assignee Lender
in connection with such Lender Assignment Agreement, shall have the rights and
obligations of a Lender hereunder and under the other Loan Documents, and (y)
the assignor Lender, to the extent that rights and obligations hereunder have
been assigned and delegated by it in connection with such Lender Assignment
Agreement, shall be released from its obligations

 

51

 

hereunder and under the other Loan Documents but shall continue to be
entitled to the benefits of the indemnity provisions hereunder for the period
prior to such assignment.  Within five
Business Days after its receipt of notice that the Agent has received an
executed Lender Assignment Agreement, the Borrower shall execute and deliver to
the Agent (for delivery to the relevant Assignee Lender) a new Note evidencing
such Assignee Lender’s assigned Loans and Commitments, and, if the assignor
Lender has retained Loans and a Commitment hereunder, a replacement Note in the
principal amount of the Loans and Commitment retained by the assignor Lender
hereunder (such Note to be in exchange for, but not in payment of, that Note then
held by such assignor Lender).  Each
such Note shall be dated the date of the predecessor Note.  The assignor Lender shall mark the
predecessor Note “exchanged” and deliver it to the Borrower.  Accrued interest on that part of the
predecessor Note evidenced by the new Note, and accrued fees, shall be paid as
provided in the Lender Assignment Agreement. 
Accrued interest on that part of the predecessor Note evidenced by the
replacement Note shall be paid to the assignor Lender.  Accrued interest and accrued fees shall be
paid at the same time or times provided in the predecessor Note and in this
Agreement.  Such assignor Lender or such
Assignee Lender must also pay a processing fee to the Agent upon delivery of
any Lender Assignment Agreement in the amount of $3,500 (provided,  however,
that such processing fee shall not be required to be paid by a Lender in the
case of an assignment of such Lender’s Loans and Commitments to an Affiliate or
Subsidiary of such Lender).  Any
attempted assignment and delegation not made in accordance with this Section 10.11.1
shall be null and void.  Notwithstanding
anything to the contrary set forth above, any Lender may (without requesting
the consent of the Borrower or the Agent) pledge its Loans to a Federal Reserve
Bank in accordance with applicable regulations.  Notwithstanding anything to the contrary contained herein, any
Lender (a “Granting Lender”) may grant to a special purpose funding
vehicle (an “SPC”), identified as such in writing from time to time by
the Granting Lender to the Agent and the Borrower, the option to provide to the
Borrower all or any part of any Loan that such Granting Lender would otherwise
be obligated to make to the Borrower pursuant to this Agreement; provided
that (i) nothing herein shall constitute a commitment by any SPC to make any
Loan, (ii) if an SPC elects not to exercise such option or otherwise fails to
provide all or any part of such Loan, the Granting Lender shall be obligated to
make such Loan pursuant to the terms hereof. 
The making of a Loan by an SPC hereunder shall utilize the Commitment of
the Granting Lender to the same extent, and as if, such Loan were made by such
Granting Lender.  Each party hereto
hereby agrees that no SPC shall be liable for any indemnity or similar payment
obligation under this Agreement (all liability for which shall remain with the
Granting Lender).  In furtherance of the
foregoing, each party hereto hereby agrees (which agreement shall survive the
termination of this Agreement) that, prior to the date that is one year and one
day after the payment in full of all outstanding commercial paper or other
senior indebtedness of any SPC, it will not institute against, or join any
other person in instituting against, such SPC any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings under the laws of the United
States or any State thereof.  In
addition, notwithstanding anything to the contrary contained in Section 10.1.1,
any SPC may (i) with notice to, but without the prior written consent of, the
Borrower and the Agent and without paying any processing fee therefor, assign
all or a portion of its interests in any Loans to the Granting Lender or to any
financial institutions (consented to by the Borrower and Agent) providing
liquidity and/or credit support to or for the account of such SPC to support
the funding or maintenance of Loans and (ii) disclose on a confidential basis
any non-public information relating to its Loans to any rating agency,
commercial paper dealer or provider of any surety,

 

52

 

guarantee or credit or liquidity enhancement to such SPC.  This section may not be amended without
the written consent of each Granting Lender, all or any of whose Loans are
being funded by an SPC at the time of such amendment.  It is understood and acknowledged that the Granting Lender shall
for all purposes, including, without limitation, the approval of any amendment
or waiver of any provision of any Loan Document or the obligation to pay any
amount otherwise payable by the Granting Lender under the Loan Documents,
continue to be the Lender of record hereunder.

 

As used herein, (i) the term “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 any entity that
administers or manages a Lender and (ii) the term “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 business.

 

SECTION 10.11.2.  Participations.  Any Lender may at any time sell to one or
more commercial banks or other Persons (each of such commercial banks and other
Persons being herein called a “Participant”) participating interests in
any of the Loans, its Commitment, or other interests of such Lender hereunder; provided,
however, that

 

(a)           no participation
contemplated in this Section 10.11 shall relieve such Lender from
its Commitment or its other obligations hereunder or under any other Loan
Document;

 

(b)           such Lender shall
remain solely responsible for the performance of its Commitment and such other
obligations;

 

(c)           the Borrower and the
Agent shall continue to deal solely and directly with such Lender in connection
with such Lender’s rights and obligations under this Agreement and each of the
other Loan Documents;

 

(d)           no Participant, unless
such Participant is an Affiliate of such Lender, or is itself a Lender, shall
be entitled to require such Lender to take or refrain from taking any action
hereunder or under any other Loan Document, except that such Lender may agree
with any Participant that such Lender will not, without such Participant’s
consent, take any actions of the type described in clause (b) or (c)
of Section 10.1; and

 

(e)           the Borrower shall not
be required to pay any amounts to a Lender under Sections 4.3, 4.4,
4.5, 4.6, 4.8, 4.9, 10.3 and 10.4 or
otherwise, that are greater than the amounts which it would have been required
to pay to such Lender had no participating interest been sold.

 

SECTION 10.12. 
Other Transactions. 
Nothing contained herein shall preclude the Agent or any other Lender
from engaging in any transaction, in addition to those contemplated by this Agreement
or any other Loan Document, with the Borrower or any of its Affiliates in which
the Borrower or such Affiliate is not restricted hereby from engaging with any
other Person.

 

53

 

SECTION 10.13. 
Removal and Replacement of Lenders.

 

(a)           Under any circumstances
set forth herein providing that the Borrower shall have the right to remove or
replace a Lender as a party to this Agreement, the Borrower may, upon notice to
such Lender and the Agent, (i) remove such Lender by terminating such Lender’s
Commitment or (ii) replace such Lender by causing such Lender to assign its
Commitment (without payment of any assignment fee) pursuant to Section 10.11.1
to one or more other Lenders, commercial banks, other financial institutions or
Approved Funds procured by the Borrower. 
The Borrower shall (x) pay in full all principal, interest, fees and
other amounts owing to such Lender through the date of removal or replacement
(including any amounts payable pursuant to Section 4.4), and (y)
release such Lender from its obligations under the Loan Documents.  Any Lender being replaced shall execute and
deliver a Lender Assignment Agreement with respect to such Lender’s Commitment
and Loans.  The Agent shall distribute a
schedule, which shall be deemed incorporated into this Agreement, to reflect
changes in the identities of the Lenders and adjustments of their respective
Commitments and/or Percentage resulting from any such removal or replacement.

 

(b)           In order to make all
the Lenders’ interests in any outstanding Loans ratable in accordance with any
revised Percentages after giving effect to the removal or replacement of a
Lender, the Borrower shall pay or prepay, if necessary, on the effective date
thereof, all outstanding Loans of all Lenders, together with any amounts due
under Section 4.4.  The
Borrower may then request Loans from the Lenders in accordance with their
revised Percentages.  The Borrower may
net any payments required hereunder against any funds being provided by any
Lender commercial bank, other financial institution or Approved Fund replacing
a terminating Lender.  The effect for
purposes of this Agreement shall be the same as if separate transfers of funds
had been made with respect thereto.

 

(c)           This section shall
supersede any provision in Section 10.1 to the contrary.

 

SECTION 10.14. 
Forum Selection and Consent to Jurisdiction.  ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER,
OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE
OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS
OF THE AGENT, THE LENDERS OR THE BORROWER SHALL BE BROUGHT AND MAINTAINED
EXCLUSIVELY IN THE COURTS OF THE STATE OF NEW YORK OR IN THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK.  THE BORROWER HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO
THE
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND OF THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY
SUCH LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES TO BE BOUND BY ANY
JUDGMENT RENDERED THEREBY IN CONNECTION WITH SUCH LITIGATION.  THE BORROWER FURTHER IRREVOCABLY CONSENTS TO
THE SERVICE OF PROCESS BY REGISTERED MAIL TO THE CORPORATE SECRETARY, POSTAGE
PREPAID, AND WAIVES PERSONAL

 

54

 

SERVICE
OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER
MEANS PERMITTED BY THE LAW OF THE STATE OF NEW YORK.  THE BORROWER HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR
HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT
IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS
BEEN BROUGHT IN AN INCONVENIENT FORUM. 
TO THE EXTENT THAT THE BORROWER HAS OR HEREAFTER MAY ACQUIRE ANY
IMMUNITY FROM JURISDICTION OF ANY COURT OF FROM ANY LEGAL PROCESS (WHETHER
THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF
EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, THE BORROWER
HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.

 

SECTION 10.15.  WAIVER OF JURY TRIAL.  THE AGENT, THE LENDERS AND THE BORROWER HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO
A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF,
UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY
COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR
ACTIONS OF THE AGENT, THE LENDERS OR THE BORROWER.  THE BORROWER ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL
AND SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH OTHER PROVISION OF
EACH OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND THAT THIS PROVISION IS A
MATERIAL INDUCEMENT FOR THE AGENT AND THE LENDERS ENTERING INTO THIS AGREEMENT
AND EACH SUCH OTHER LOAN DOCUMENT.

 

[signature pages
to follow]

 

55

 

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

 

	
   

  	
  McCORMICK & COMPANY,

  INCORPORATED

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/  Francis A. Contino

  	
   

  
	
   

  	
   

  	
  Francis A. Contino

  
	
   

  	
   

  	
  Title:

  	
  Vice President &

  Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/  W. Geoffrey Carpenter

  	
   

  
	
   

  	
   

  	
  W. Geoffrey Carpenter

  
	
   

  	
   

  	
  Title:

  	
  Assistant Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
  Address:

  	
  18 Loveton Circle

  Sparks, MD  21152

  
	
   

  	
  Facsimile No.:

  	
  (410) 527-8228

  
	
   

  	
  Attention:

  	
  Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  WACHOVIA BANK, NATIONAL

  ASSOCIATION,

  as Administrative Agent

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/  Trey Anglin

  	
   

  
	
   

  	
   

  	
  Trey Anglin

  
	
   

  	
   

  	
  Title:

  	
  Assistant Vice
  President

  
	
   

  	
   

  	
   

  
	
   

  	
  One Wachovia Center

  
	
   

  	
  301 South College
  Street

  
	
   

  	
  Mail
  Code:  NC-0145

  
	
   

  	
  Charlotte,
  NC  28288

  
	
   

  	
  Attention:  Trey Anglin

  
	
   

  	
  Facsimile
  No.:

  	
  (704) 374-4000

  
						

 

56

 

SCHEDULE I

 

DISCLOSURE
SCHEDULE

 

 

ITEM 6.7                 Litigation.

 

[None.]

 

 

ITEM 6.8                 Existing
Subsidiaries as of the Effective Date.

 

[Attached
- Exhibit A.]

 

 

ITEM 6.11               Employee Benefit
Plans.

 

[Attached
- Exhibit B.]

 

 

ITEM 6.12               Environmental
Matters.

 

[None.]

 

ITEM 7.2.3              Existing Liens.

 

[Attached
- Exhibit C.]

 

 

EXHIBIT
A

 

EXISTING SUBSIDIARIES OF McCORMICK
& COMPANY, INCORPORATED

 

 

THE AMERICAS
MARKET ZONE

 

Ampacco,
Inc. (Maryland)

Han-Dee
Pak, Inc.  (Maryland)

McCormick
de Puerto Rico, Inc.  (Delaware)

Mojave
Foods Corporation  (Maryland)

El
Guapo Foods, Inc.  (California)

More
For Less, Inc.  (Delaware)

Produce
Partners, Inc.  (Illinois)

Old
Bay Company, Inc.  (Delaware)

McCormick
Holding Company, Inc.  (Delaware)

McCormick
Investment Company, Inc.  (Delaware)

McCormick
Fresh Herbs, LLC  (Delaware)

McCormick
de Centro America, S.A. de C.V.  (El
Salvador)

 

 

EUROPEAN MARKET
ZONE

 

McCormick
Europe Ltd.  (United Kingdom)

McCormick
International Holdings Ltd.  (United
Kingdom)

McCormick
France S.A.S  (France)

Ducros
S.A.S.  (France)

Sodis
S.A.S.  (France)

McCormick
Management Services S.A.R.L.  (France)

McCormick
(UK) Limited  (Scotland)

Bluebroad
1 Limited  (England)

McCormick
Baharat de Gida Sanayi A.S.  (Turkey)

McCormick
South Africa  (Proprietary) Ltd.  (South Africa)

McCormick
Kutas Food Service Ltd.  (United
Kingdom)

Noel
Holdings Limited  (England)

McCormick
Foodservice Ltd.  (England)

McCormick
S.A.  (Switzerland)

Oy
McCormick Ab  (Finland)

 

 

ASIAN MARKET
ZONE

 

McCormick
Foods Australia Pty. Ltd.  (Australia)

Traders
Pty. Ltd.  (Australia)

McCormick
(Guangzhou) Food Company Limited 
(China)

McCormick
India Private Limited  (India)

Shanghai
McCormick Foods Company, Limited (China) (90% owned)

 

 

GLOBAL
INDUSTRIAL GROUP

 

McCormick
Ingredients Southeast Asia Private Limited

McCormick
Thailand, Inc.  (Delaware)

McCormick
(Thailand) Ltd.  (Thailand)

Classic
Foods, Inc.  (Connecticut)

McCormick
Pesa, S.A. de C.V.  (Mexico)

McCormick
Uruguay Holdings, Inc.  (Delaware)

McCormick
Uruguay, S.A.  (Uruguay)

La
Cie McCormick Canada Co.  (Canada)

Setco,
Inc.  (Delaware)

Tubed
Products, Inc.  (Maryland)

OG
Dehydrated, Inc.  (California)

 

 

MISCELLANEOUS

 

AH
Investments, Inc.  (Maryland)

Armanino
Farms of California, Inc.  (California)

International
Ingredients, Inc.  (Maryland)

McCormick
Credit, Inc.  (Delaware)

McCormick
Delaware, Inc.  (Delaware)

McCormick
Foreign Sales Corporation  (U.S. Virgin
Islands)

McCormick
Ingredientes Brasil Ltda.  (Brazil)

McCormick
Global Ingredients Limited  (Cayman)

McCormick
Cyprus Limited  (Cyprus)

McCormick
Hungary Group Financing Limited Liability Company (Hungary)

McCormick
Europe Ltd.  (United Kingdom)

McCormick
(UK) Limited  (Scotland)

McCormick
International Holdings Ltd.  (United
Kingdom)

La
Cie McCormick Canada Co.  (Canada)

McCormick
Foods Australia Pty. Ltd.  (Australia)

 

2

 

EXHIBIT
B

 

EMPLOYEE BENEFIT PLANS

 

8.
PENSION AND 401(K) RETIREMENT PLANS

The Company’s pension
expense is as follows:

 

	
   

  	
   

  	
  United
  States

  	
   

  	
  International

  	
   

  
	
  (millions)

  	
   

  	
  2002

  	
   

  	
  2001

  	
   

  	
  2000

  	
   

  	
  2002

  	
   

  	
  2001

  	
   

  	
  2000

  	
   

  
	
  Defined
  benefit plans

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Service
  cost

  	
   

  	
  $

  	
  9.6

  	
   

  	
  $

  	
  7.7

  	
   

  	
  $

  	
  7.1

  	
   

  	
  $

  	
  3.5

  	
   

  	
  $

  	
  3.5

  	
   

  	
  $

  	
  2.7

  	
   

  
	
  Interest
  costs

  	
   

  	
  16.3

  	
   

  	
  14.6

  	
   

  	
  13.8

  	
   

  	
  4.2

  	
   

  	
  3.6

  	
   

  	
  3.3

  	
   

  
	
  Expected
  return on plan assets

  	
   

  	
  (17.8

  	
  )

  	
  (15.5

  	
  )

  	
  (14.1

  	
  )

  	
  (5.9

  	
  )

  	
  (5.3

  	
  )

  	
  (4.7

  	
  )

  
	
  Amortization
  of prior service costs

  	
   

  	
  —

  	
   

  	
  .1

  	
   

  	
  .1

  	
   

  	
  .1

  	
   

  	
  .1

  	
   

  	
  .1

  	
   

  
	
  Amortization
  of transition assets

  	
   

  	
  .2

  	
   

  	
  .2

  	
   

  	
  .2

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  (.1

  	
  )

  
	
  Curtailment loss

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  (.4

  	
  )

  	
  —

  	
   

  
	
  Recognized
  net actuarial loss (gain)

  	
   

  	
  3.5

  	
   

  	
  1.0

  	
   

  	
  1.3

  	
   

  	
  —

  	
   

  	
  (.1

  	
  )

  	
  —

  	
   

  
	
  Other
  retirement plans

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  1.5

  	
   

  	
  .9

  	
   

  	
  .5

  	
   

  
	
   

  	
   

  	
  $

  	
  11.8

  	
   

  	
  $

  	
  8.1

  	
   

  	
  $

  	
  8.4

  	
   

  	
  $

  	
  3.4

  	
   

  	
  $

  	
  2.3

  	
   

  	
  $

  	
  1.8

  	
   

  

 

The Company’s U.S. pension plans held 0.9 million
shares, with a fair value of $21.9 million, of the Company’s stock at November
30, 2002.  Dividends paid on these
shares in 2002 were $0.4 million.

Rollforwards of the benefit obligation, fair value of
plan assets and a reconciliation of the pension plans’ funded status at
September 30, the measurement date, follow:

 

	
   

  	
   

  	
  United
  States

  	
   

  	
  International

  	
   

  
	
  (millions)

  	
   

  	
  2002

  	
   

  	
  2001

  	
   

  	
  2002

  	
   

  	
  2001

  	
   

  
	
  Change in
  benefit obligation

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Beginning of the
  year

  	
   

  	
  $

  	
  228.8

  	
   

  	
  $

  	
  186.9

  	
   

  	
  $

  	
  66.8

  	
   

  	
  $

  	
  59.0

  	
   

  
	
  Service cost

  	
   

  	
  9.6

  	
   

  	
  7.7

  	
   

  	
  3.5

  	
   

  	
  3.5

  	
   

  
	
  Interest costs

  	
   

  	
  16.3

  	
   

  	
  14.6

  	
   

  	
  4.2

  	
   

  	
  3.6

  	
   

  
	
  Employee
  contributions

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  1.5

  	
   

  	
  1.2

  	
   

  
	
  Plan changes and
  other

  	
   

  	
  —

  	
   

  	
  (.1

  	
  )

  	
  2.2

  	
   

  	
  .8

  	
   

  
	
  Curtailment

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  (.5

  	
  )

  
	
  Actuarial loss

  	
   

  	
  37.5

  	
   

  	
  28.5

  	
   

  	
  1.5

  	
   

  	
  2.0

  	
   

  
	
  Benefits paid

  	
   

  	
  (11.8

  	
  )

  	
  (8.8

  	
  )

  	
  (2.2

  	
  )

  	
  (2.1

  	
  )

  
	
  Foreign currency
  impact

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  5.0

  	
   

  	
  (.7

  	
  )

  
	
  End of the year

  	
   

  	
  $

  	
  280.4

  	
   

  	
  $

  	
  228.8

  	
   

  	
  $

  	
  82.5

  	
   

  	
  $

  	
  66.8

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Change in fair
  value of plan assets

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Beginning of the
  year

  	
   

  	
  $

  	
  166.8

  	
   

  	
  $

  	
  167.4

  	
   

  	
  $

  	
  55.1

  	
   

  	
  $

  	
  65.6

  	
   

  
	
  Actual return on
  plan assets

  	
   

  	
  (15.6

  	
  )

  	
  (9.6

  	
  )

  	
  (6.3

  	
  )

  	
  (11.4

  	
  )

  
	
  Other

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  2.1

  	
   

  	
  —

  	
   

  
	
  Employer
  contributions

  	
   

  	
  20.8

  	
   

  	
  16.2

  	
   

  	
  2.8

  	
   

  	
  2.3

  	
   

  
	
  Employee
  contributions

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  1.5

  	
   

  	
  1.2

  	
   

  
	
  Benefits paid

  	
   

  	
  (10.2

  	
  )

  	
  (7.2

  	
  )

  	
  (2.2

  	
  )

  	
  (2.1

  	
  )

  
	
  Foreign currency
  impact

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  3.7

  	
   

  	
  (.5

  	
  )

  
	
  End of the year

  	
   

  	
  $

  	
  161.8

  	
   

  	
  $

  	
  166.8

  	
   

  	
  $

  	
  56.7

  	
   

  	
  55.1

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Reconciliation
  of funded status

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (Under)/over
  funded status

  	
   

  	
  $

  	
  (118.8

  	
  )

  	
  $

  	
  (62.0

  	
  )

  	
  $

  	
  (25.8

  	
  )

  	
  $

  	
  (11.7

  	
  )

  
	
  Unrecognized net
  actuarial loss

  	
   

  	
  143.7

  	
   

  	
  79.9

  	
   

  	
  25.9

  	
   

  	
  10.8

  	
   

  
	
  Unrecognized
  prior service cost

  	
   

  	
  .6

  	
   

  	
  .7

  	
   

  	
  .5

  	
   

  	
  .5

  	
   

  
	
  Unrecognized
  transition asset (liability)

  	
   

  	
  —

  	
   

  	
  .2

  	
   

  	
  (.2

  	
  )

  	
  (.2

  	
  )

  
	
  Employer
  contributions

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  .4

  	
   

  	
  .3

  	
   

  
	
   

  	
   

  	
  $

  	
  25.7

  	
   

  	
  $

  	
  18.8

  	
   

  	
  $

  	
  .8

  	
   

  	
  $

  	
  (.3

  	
  )

  

 

Included in the United States in the preceding table
is a benefit obligation of $25.8 million and $20.0 million for 2002 and 2001,
respectively, related to an unfunded pension plan.  The accrued liability related to this plan was $22.4 million and
$12.3 million as of November 30, 2002 and 2001, respectively.  The assets related to this plan are held in
a Rabbi Trust and accordingly have not been included in the preceding
table.  These assets were $14.3 million
and $17.7 million as of November 30, 2002 and 2001, respectively.

Amounts recognized in the consolidated balance sheet
consist of the following:

 

	
   

  	
   

  	
  United
  States

  	
   

  	
  International

  	
   

  
	
  (millions)

  	
   

  	
  2002

  	
   

  	
  2001

  	
   

  	
  2002

  	
   

  	
  2001

  	
   

  
	
  Prepaid pension
  cost

  	
   

  	
  —

  	
   

  	
  $

  	
  18.8

  	
   

  	
  $

  	
  2.6

  	
   

  	
  $

  	
  .9

  	
   

  
	
  Accrued pension
  liability

  	
   

  	
  $

  	
  (67.3

  	
  )

  	
  —

  	
   

  	
  (19.0

  	
  )

  	
  (1.2

  	
  )

  
	
  Intangible
  assets

  	
   

  	
  .6

  	
   

  	
  —

  	
   

  	
  .4

  	
   

  	
  —

  	
   

  
	
  Deferred income
  taxes

  	
   

  	
  35.0

  	
   

  	
  —

  	
   

  	
  5.1

  	
   

  	
  —

  	
   

  
	
  Accumulated
  other comprehensive income

  	
   

  	
  57.4

  	
   

  	
  —

  	
   

  	
  11.7

  	
   

  	
  —

  	
   

  
	
   

  	
   

  	
  $

  	
  25.7

  	
   

  	
  $

  	
  18.8

  	
   

  	
  $

  	
  .8

  	
   

  	
  $

  	
  (.3

  	
  )

  

 

The accumulated benefit obligation for the U.S.
pension plans was $229.2 million and $184.9 million as of September 30, 2002
and 2001, respectively.

As of the measurement date, the market value of the
pension plan assets was below the accumulated benefit obligation, and the
Company was required to record a minimum pension liability of $110.2 million ($69.1
million after tax) as calculated under SFAS No. 87.  This resulted in an increase in the pension
liability of $110.2 million, a decrease in other comprehensive income of $69.1
million, an increase in deferred tax assets of $40.1 million, and an increase
in intangible assets of $1.0 million.

 

	
   

  	
   

  	
  United
  States

  	
   

  	
  International

  	
   

  
	
   

  	
   

  	
  2002

  	
   

  	
  2001

  	
   

  	
  2002

  	
   

  	
  2001

  	
   

  
	
  Significant
  assumptions

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Discount rate

  	
   

  	
  7.0

  	
  %

  	
  7.25

  	
  %

  	
  5.5-6.5

  	
  %

  	
  5.75-6.5

  	
  %

  
	
  Salary scale

  	
   

  	
  4.0

  	
  %

  	
  4.5

  	
  %

  	
  3.5-4.0

  	
  %

  	
  3.5-4.0

  	
  %

  
	
  Expected return
  on plan assets

  	
   

  	
  10.0

  	
  %

  	
  10.0

  	
  %

  	
  7.0-8.5

  	
  %

  	
  8.5

  	
  %

  

 

As of December 1, 2002, pension expense will be
calculated using a 9% expected return on plan assets.

 

401(k) Retirement Plan

Effective March 22, 2002, the 401(k) Retirement Plan was amended to
provide that the McCormick Stock Fund investment option be designated an
employee stock ownership plan (ESOP). 
This designation allows participants investing in McCormick stock to
elect to receive, in cash, dividends that are paid on McCormick stock held in
their 401(k) Retirement Plan accounts. Dividends may also continue to be
reinvested.

The Company matches 100% of the participant’s
contribution up to the first 3% of the participant’s salary, and 50% of the
next 2% of a participant’s salary. 
Company contributions charged to expense under the McCormick 401(k)
Retirement Plan were $7.0 million, $6.6 million and $5.8 million in 2002,
2001 and 2000, respectively.

At the participant’s election, the McCormick 401(k)
Retirement Plan held 4.4 million shares, with a fair value of $105.8 million,
of the Company’s stock at November 30, 2002. 
Dividends paid on these shares in 2002 were $1.9 million.

 

9. OTHER POSTRETIREMENT BENEFITS

The Company’s other postretirement benefit expense follows:

 

	
  (millions)

  	
   

  	
  2002

  	
   

  	
  2001

  	
   

  	
  2000

  	
   

  
	
  Other postretirement
  benefits

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Service cost

  	
   

  	
  $

  	
  3.1

  	
   

  	
  $

  	
  2.6

  	
   

  	
  $

  	
  2.4

  	
   

  
	
  Interest cost

  	
   

  	
  5.7

  	
   

  	
  5.5

  	
   

  	
  5.3

  	
   

  
	
  Amortization of
  prior service cost

  	
   

  	
  (.6

  	
  )

  	
  (.7

  	
  )

  	
  (.7

  	
  )

  
	
  Accelerated
  recognition of prior unrecognized service cost

  	
   

  	
  —

  	
   

  	
  —

  	
   

  	
  (.6

  	
  )

  
	
   

  	
   

  	
  $

  	
  8.2

  	
   

  	
  $

  	
  7.4

  	
   

  	
  $

  	
  6.4

  	
   

  

 

Rollforwards of the benefit obligation, fair value of
plan assets and a reconciliation of the plan’s funded status at November 30,
the measurement date, follow:

 

	
  (millions)

  	
   

  	
  2002

  	
   

  	
  2001

  	
   

  
	
  Change in
  benefit obligation

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Beginning of the
  year

  	
   

  	
  $

  	
  81.8

  	
   

  	
  $

  	
  71.3

  	
   

  
	
  Service cost

  	
   

  	
  3.1

  	
   

  	
  2.6

  	
   

  
	
  Interest cost

  	
   

  	
  5.7

  	
   

  	
  5.5

  	
   

  
	
  Employee
  contributions

  	
   

  	
  2.3

  	
   

  	
  2.0

  	
   

  
	
  Plan changes

  	
   

  	
  (9.1

  	
  )

  	
  —

  	
   

  
	
  Actuarial loss

  	
   

  	
  8.0

  	
   

  	
  5.6

  	
   

  
	
  Benefits paid

  	
   

  	
  (8.0

  	
  )

  	
  (5.2

  	
  )

  
	
  End of the year

  	
   

  	
  $

  	
  83.8

  	
   

  	
  $

  	
  81.8

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Change in fair
  value of plan assets

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Beginning of the
  year

  	
   

  	
  $

  	
  —

  	
   

  	
  $

  	
  —

  	
   

  
	
  Employer
  contributions

  	
   

  	
  5.7

  	
   

  	
  3.2

  	
   

  
	
  Employee
  contributions

  	
   

  	
  2.3

  	
   

  	
  2.0

  	
   

  
	
  Benefits paid

  	
   

  	
  (8.0

  	
  )

  	
  (5.2

  	
  )

  
	
  End of the year

  	
   

  	
  $

  	
  —

  	
   

  	
  $

  	
  —

  	
   

  
	
  Reconciliation
  of funded status

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Funded status

  	
   

  	
  $

  	
  (85.8

  	
  )

  	
  $

  	
  (81.8

  	
  )

  
	
  Unrecognized net
  actuarial loss

  	
   

  	
  15.3

  	
   

  	
  7.3

  	
   

  
	
  Unrecognized
  prior service cost

  	
   

  	
  (13.7

  	
  )

  	
  (5.3

  	
  )

  
	
  Other
  postretirement benefit liability

  	
   

  	
  $

  	
  (82.2

  	
  )

  	
  $

  	
  (79.8

  	
  )

  

 

The assumed weighted-average discount rates were 7.0%
and 7.25% for 2002 and 2001, respectively.

 

The assumed annual rate of increase in the cost of
convered health care benefits is 8.0% for 2002.  It is assumed to decrease gradually to 4.5% in the year 2008 and
remain at the level thereafter. 
Changing the assumed health care cost trend would have the following
effect:

 

	
  (millions)

  	
   

  	
  1-Percentage
  -

  Point Increase

  	
   

  	
  1-Percentage
  -

  Point Decrease

  	
   

  
	
  Effect on
  benefit obligation as of November 30, 2002

  	
   

  	
  $

  	
  8.1

  	
   

  	
  $

  	
  (6.9

  	
  )

  
	
  Effect on total
  of service and interest cost components in 2002

  	
   

  	
  $

  	
  .9

  	
   

  	
  $

  	
  (.8

  	
  )

  

 

During 2002 the Company changed certain postretirement
benefits for employees who retire on or after January 1, 2004, Life insurance
benefits will change to a fixed amount. 
Medicare eligible retirees will have a fixed amount for medical plan
coverage, and the medical cost sharing for dependents will increase.

 

 

EXHIBIT C

EXISTING LIENS

 

(as of 4/3/03,
in thousands)

 

 

	
   

  	
   

  	
  Current

  	
   

  	
  Long Term

  	
   

  	
  Total

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Capital
  Lease Liability

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  McCormick
  Foods

  	
   

  	
  29

  	
   

  	
  0

  	
   

  	
  29

  	
   

  	
  Autos

  	
   

  
	
  Australia

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  McCormick
  Pesa

  	
   

  	
  102

  	
   

  	
  0

  	
   

  	
  102

  	
   

  	
  Computers

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Industrial
  Revenue Bonds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tubed
  Products

  	
   

  	
  0

  	
   

  	
  3,050

  	
   

  	
  3,050

  	
   

  	
   

  	
   

  
	
  (Oxnard,
  California)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgages

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (none
  outstanding)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

FORM OF
NOTE

 

	
  U.S.$100,000,000

  	
  May 30,
  2003

  	
   

  

 

FOR VALUE RECEIVED, the undersigned, McCORMICK &
COMPANY, INCORPORATED, a Maryland corporation (the “Borrower”), promises
to pay to the order of WACHOVIA BANK, NATIONAL ASSOCIATION (the “Lender”)
on the Maturity Date (as such term in defined in the 364-Day Credit Agreement,
dated as of May 30, 2003 (as amended or modified from time to time, the “Credit
Agreement”)), among the Borrower, Wachovia Bank, National Association, as
the administrative agent (the “Agent”), and the various financial
institutions (including the Lender) as are, or may become parties thereto, the
aggregate unpaid principal amount of all Loans made by the Lender to the
Borrower from time to time pursuant to the Credit Agreement, the principal sum
of ONE HUNDRED MILLION UNITED STATES DOLLARS (U.S. $100,000,000) (or the
Foreign Currency Equivalent of any currency which the Borrower may borrow under
the Credit Agreement) or, if less, the aggregate unpaid principal amount of all
Loans made by the Lender pursuant to the Credit Agreement.  A notation indicating all Loans made by the
Lender pursuant to the Credit Agreement and payments on account of the
principal of such Loans may, from time to time, be made by the holder hereof on
the grid attached to this note (this “Note”).  Unless defined herein or the context otherwise requires, terms
used herein have the meanings provided in the Credit Agreement.

 

The unpaid principal amount of this Note from time to
time outstanding shall bear interest as provided in Section 3.3.1
of the Credit Agreement.  All payments
of principal of and interest on this Note shall be payable in lawful currency
of the United States of America (or the other currency borrowed) to the account
designated by the Agent in same day or immediately available funds.

 

This Note is one of the Notes referred to in, and
evidences indebtedness incurred in respect of the Loans under, the Credit
Agreement, to which reference is made for a description of any security for
this Note and for a statement of the terms and conditions on which the Borrower
is permitted and required to make prepayments of principal of the indebtedness
evidenced by this Note and on which such indebtedness may be declared to be
immediately due and payable.

 

Exhibit A-1

Page 1 of 3

 

THIS NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK AND SHALL
BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE
STATE OF NEW YORK.

 

	
   

  	
  McCORMICK &
  COMPANY,

  INCORPORATED

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
     Francis
  A. Contino

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
    Vice
  President & CFO

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
     W.
  Geoffrey Carpenter

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
    Assistant
  Secretary

  
					

 

Exhibit A-1

Page 2 of 3

 

	
  Date

  	
   

  	
  Amount of

  Loans and

  Currency

  	
   

  	
  Alternate
  Base

  Rate

  	
   

  	
  LIBO Rate

  	
   

  	
  Last Day
  of

  Applicable

  Interest Period

  	
   

  	
  Amount of

  Principal

  Payment

  	
   

  	
  Outstanding

  Principal

  Balance

  	
   

  	
  Notation

  Made By

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

Exhibit A-1

Page 3 of 3

 

FORM OF BORROWING REQUEST

 

 

Wachovia
Bank, National Association,

as Administrative Agent

Agency
Servicing

301
South College Street

Mail
Code:  NC-0680

Charlotte,
NC  28288

 

Attention:  Roger Sherman

 

McCormick & Company, Incorporated

 

Gentlemen
and Ladies:

 

This Borrowing Request is
delivered to you pursuant to clause (b) of Section 2.1 of
the 364-Day Credit Agreement, dated as of May 30, 2003 (as amended or
modified from time to time, the “Credit Agreement”), among McCormick
& Company, Incorporated, a Maryland corporation (the “Borrower”),
the Lenders now or hereafter parties thereto and Wachovia Bank, National
Association, as administrative agent (the “Agent”).  Unless otherwise defined herein or the
context otherwise requires, terms used herein have the meanings provided in the
Credit Agreement.

 

The Borrower hereby requests
that a Loan Borrowing be made in the aggregate principal amount of [$U.S.] [£]
[DM] [¥] [Euro]
                                  
on
                                   ,
           as [a Base Rate
Loan] [a LIBO Rate Loan having an interest period of
            months].

 

The Borrower hereby certifies
and warrants that on the date the Borrowing requested hereby is made (both
before and after giving effect to such Borrowing);

 

(a)           the
representations and warranties set forth in Article VI of the
Credit Agreement are and will be true and correct as if then made pursuant to
Section 5.2.1 of the Credit Agreement;

 

(b)           no
Default or Event of Default has occurred and is continuing or will have
occurred and be continuing; and

 

(c)           the
aggregate amount of the requested Borrowing and all other Loans outstanding on
the date of the requested Borrowing does not and will not exceed the Commitment
Amount.

 

The undersigned hereby confirms
that the requested Borrowing is to be made available to it in accordance with Section 2.1
of the Credit Agreement.

 

The Borrower agrees that if
prior to the time of the Borrowing requested hereby any matter certified to
herein by it will not be true and correct at such time as if then made, it will

 

Exhibit B-1

Page 1 of 2

 

immediately so notify the Agent.  Except to the extent, if any, that prior to
the time of the Borrowing requested hereby the Agent shall receive written
notice to the contrary from the Borrower, each matter certified to herein shall
be deemed once again to be certified an true and correct at the date of such
Borrowing as if then made.

 

Please wire transfer the
proceeds of the Borrowing to the following account of the Borrower:  Account No.
                                        ,
(Name and address of depository bank).

 

The Borrower has caused this
Borrowing Request to be executed and delivered, and the certificate and
warranties contained herein to be made, by its duly Authorized Officer this
              
day of                                     ,
      .

 

	
   

  	
  McCORMICK
  & COMPANY, INCORPORATED

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Title:

  
				

 

Exhibit B-1

Page 2 of 2

 

FORM OF LENDER ASSIGNMENT AGREEMENT

 

[Date]

 

 

 

TO:         McCormick & Company, Incorporated

18 Loveton Circle

Sparks, Maryland 21152

Attention: Treasurer

 

To:          Wachovia Bank, National Association,

  as Administrative
Agent

Agency Servicing

301 South College Street

Mail Code:  NC-0680

Charlotte, NC  28288

Attention:  Roger Sherman

 

McCormick & Company, Incorporated

 

Gentlemen
and Ladies:

 

We refer to clause (d) of
Section 10.11.1 of the 364-Day Credit Agreement, dated as of
May 30, 2003 (as amended from time to time, the “Credit Agreement”),
among McCormick & Company, Incorporated, a Maryland corporation (the “Borrower”),
the various financial institutions as are, or shall from time to time become,
parties thereto (the “Lenders”) and Wachovia Bank, National
Association, as administrative agent (the “Agent”).  Unless otherwise defined herein or the
context otherwise requires, terms used herein have the meanings provided in the
Credit Agreement.

 

This Agreement is delivered to
you pursuant to clause (d) of Section 10.11.1 of the Credit
Agreement and also constitutes notice to each of you, pursuant to clause (c)
of Section 10.11.1 of the Credit Agreement, of the assignment and
delegation to
                                         
(the “Assignee”) of         % of
the Loans of
                                           
(the “Assignor”) outstanding under the Credit Agreement on the date
hereof.  After giving effect to the
foregoing assignment and delegation, the Assignor’s and the Assignee’s
Percentages for the purposes of the Credit Agreement are set forth opposite
such Person’s name on the signature pages hereof.

 

[Add paragraph dealing with accrued
interest and fees with respect to Loans assigned.]

 

The Assignee hereby acknowledges
and confirms that it has received a copy of the Credit Agreement and the
exhibits related thereto, together with copies of the documents which were
required to be delivered under the Credit Agreement as a condition to the
making of the Loans thereunder. The Assignee further confirms and agrees that
in becoming a Lender and in making its Loans under the Credit Agreement, such
actions have and will be made without recourse to, or representation or
warranty by the Agent.

 

Exhibit C

Page 1 of 3

 

Except as otherwise provided in
the Credit Agreement, effective as of the date of acceptance hereof by the
Agent:

 

(a)           the
Assignee

 

(i)            shall
be deemed automatically to have become a party to the Credit Agreement, have
all the rights and obligations of a “Lender” under the Credit Agreement and the
other Loan Documents as if it were an original signatory thereto to the extent
specified in the second paragraph hereof; and

 

(ii)           agrees
to be bound by the terms and conditions set forth in the Credit Agreement and
the other Loan Documents as if it were an original signatory thereto; and

 

(b)           the
Assignor shall be released from its obligations under the Credit Agreement and
the other Loan Documents to the extent specified in the second paragraph hereof
but shall continue to be entitled to the benefits of the indemnity provisions
set forth in the Credit Agreement for the period prior to such acceptance.

 

The Assignor and the Assignee
hereby agree that the [Assignor] [Assignee] will pay to the Agent the
processing fee referred to in Section 10.11.1 of the Credit
Agreement upon the delivery hereof.

 

The Assignee hereby advises each
of you of the following administrative details with respect to the assigned
Loans and requests the Agent to acknowledge receipt of this document:

 

(A)          Address for Notices:

 

Institution Name:

 

Attention:

 

Domestic Office:

 

Telephone:

 

Facsimile:

 

LIBOR Office:

 

Telephone:

 

Facsimile:

 

(B)           Payment Instructions:

 

The Assignee agrees to furnish
the tax form required by the last sentence of Section 4.6 (if so
required) of the Credit Agreement no later than the date of acceptance hereof
by the Agent.

 

Exhibit C

Page 2 of 3

 

This Agreement may be executed
by the Assignor and Assignee in separate counterparts, each of which when so
executed and delivered shall be deemed to be an original and all of which taken
together shall constitute one and the same Agreement.

 

	
  Adjusted
  Percentage

  	
  [ASSIGNOR]

  
	
   

  	
   

  
	
          %

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
  Percentage

  	
  [ASSIGNEE]

  
	
   

  	
   

  
	
          %

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  
					

 

Accepted and Acknowledged

this
           day of
                      ,
        

 

	
  McCORMICK
  & COMPANY, INCORPORATED

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  WACHOVIA
  BANK, NATIONAL ASSOCIATION,

  as Administrative Agent

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  
					

 

Exhibit C

Page 3 of 3

 

FORM OF
COMPLIANCE CERTIFICATE

 

To each of the financial
institutions party

to the Credit Agreement hereinafter

referred to and Wachovia Bank, National

Association, as Administrative Agent for

the Lenders

 

Re:       McCormick & Company,
Incorporated 

 

Ladies and Gentlemen:

 

This Compliance Certificate is being delivered
pursuant to the 364-Day Credit Agreement, dated as of May 30, 2003 (as
amended or modified from time to time, the “Credit Agreement”), among
McCormick & Company, Incorporated, a Maryland corporation (the “Borrower”),
the various financial institutions as are or may, from time to time, become
parties thereto (the “Lenders”) and Wachovia Bank, National Association,
as administrative agent for the Lenders (the “Agent”).  Capitalized terms used herein without
definition shall have the meanings assigned to such terms in Section 1.1
of the Credit Agreement.  All
computations performed herein shall conform to the method of computation
required by the Credit Agreement.

 

The Borrower hereby certifies, represents and warrants
that as of
                         ,
            (the “Computation
Date”):

 

1.             Indebtedness of the
Subsidiaries did not exceed
             %
of Consolidated Net Tangible Assets (as computed on Attachment 1
hereto).

 

Under Section 7.2.2
of the Credit Agreement, Indebtedness of Subsidiaries may not exceed 25% of
Consolidated Net Tangible Assets.

 

2.             The sum of (a)
Indebtedness of the Borrower and its Subsidiaries secured by Liens described in
clauses (b), (c) and (k) of Section 7.2.3 of the Credit Agreement
(excluding liens described in clauses (d) through (j) of Section 7.2.3)
and (b) the Attributable Value of all Sale-Leaseback Transactions entered into
by the Borrower and its Subsidiaries in the aggregate does not exceed
       % of Consolidated Net Tangible Assets
(as computed on Attachment 1 hereto).

 

Section 7.2.3
(k) of the Credit Agreement does not permit the sum of (i) Indebtedness of the
Borrower and its Subsidiaries secured by Liens described in clauses (b), (c)
and (k) of Section 7.2.3 (excluding Liens described in clauses
(d)  thru (j) of Section 7.2.3) and (ii) the Attributable
Value of all Sale-Leaseback Transactions entered into by the Borrower and its
Subsidiaries in the aggregate to exceed 15% of Consolidated Net Tangible
Assets.

 

3.             The aggregate book
value of all sales of assets or stock or liquidations of Subsidiaries do not,
during the most recent period of 12 consecutive months, exceed
      % of Consolidated Net Tangible Assets as at
the end of the Borrower’s immediately preceding Fiscal Year (as computed on Attachment
1 hereto).

 

Exhibit D

Page 1 of 3

 

Section 7.2.4
of the Credit Agreement prohibits sales of assets or stock to anyone other than
the Borrower or wholly-owned Subsidiaries if the aggregate book value of such
sales or liquidation of Subsidiaries during the most recent period of 12
consecutive months would exceed 20% of Consolidated Net Tangible Assets as at
the end of the Borrower’s immediately preceding fiscal year.

 

4.             The ratio of EBIT to
Interest Expense was
                      :
1:00 (as computed on Attachment 1 hereto).

 

The minimum ratio of EBIT
to Interest Expense permitted pursuant to Section 7.2.5 of the
Credit Agreement is 2.50:1.00.

 

5.             No Default or Event
of Default has occurred and is continuing.

 

IN WITNESS WHEREOF, the Borrower has caused this
Certificate to be executed and delivered by its duly Authorized Officer on this
         day of
                        ,
            .

 

	
   

  	
  McCORMICK &
  COMPANY, INCORPORATED

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Title:

  
				

 

Exhibit D

Page 2 of 3

 

ATTACHMENT
1

 

	
  1.

  	
   

  	
  Indebtedness of
  Subsidiaries (Section 7.2.2).

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  a.

  	
  Total Amount of
  Subsidiary Indebtedness

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  b.

  	
  Amount of Consolidated
  Net Tangible Assets

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  c.

  	
  Subsidiary Indebtedness
  is equal to the following percentage of Consolidated Net Tangible Assets

  	
   

  	
   

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  Liens (Section 7.2.3)

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  a.

  	
  Indebtedness of the
  Borrower and its Subsidiaries (other than intercompany debt) secured by Liens
  described in clauses (b), (c) and (k) of Section 7.2.3
  (excluding Liens described in clauses (d) through (j) of Section
  7.2.3

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  b.

  	
  Attributable Value of
  Sale-Leaseback Transactions of the Borrower and its Subsidiaries in the
  aggregate

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (Sum of Items a. and
  b.)

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  c.

  	
  Amount of Consolidated
  Net Tangible Assets

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  d.

  	
  The sum of Items a. and
  b. is equal to the following percentage of Item c.

  	
   

  	
   

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
  Sale of Assets (Section
  7.2.4)

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  a.

  	
  The aggregate book
  value of sales of assets or stock or liquidation of Subsidiaries by the
  Borrower and its Subsidiaries during the immediately preceding 12 months)

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  b.

  	
  Consolidated Net
  Tangible Assets as at the end of the Borrower’s immediately preceding Fiscal
  Year

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  c.

  	
  Item a. is equal to the
  following percentage of Item b.

  	
   

  	
   

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
   

  	
  EBIT to Interest
  Expense Ratio (Section 7.2.5)

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  a.

  	
  Net Income (excluding
  any one-time non-recurring charges)

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  b.

  	
  Interest Expense

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  c.

  	
  Charges for federal, state,
  local and foreign income taxes

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Total for EBIT

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  :1.00

  
	
   

  	
   

  	
  d.

  	
  EBIT to Interest
  Expense ratio (EBIT divided by Interest Expense)

  	
   

  	
   

  	
   

  

 

Exhibit D

Page 3 of 3

 

FORM
OF CONTINUATION/CONVERSION NOTICE

 

Wachovia Bank, National Association,

as Administrative Agent

Agency
Servicing

301
South College Street

Mail
Code:  NC-0680

Charlotte,
NC  28288

Attention:  Roger Sherman

 

Re:          McCormick &
Company, Incorporated

 

Gentlemen and Ladies:

 

This Continuation/Conversion Notice is delivered to
you pursuant to Section 2.3 of the 364-Day Credit Agreement, dated
as of May 30, 2003 (as amended or modified from time to time, the “Credit
Agreement”), among McCormick & Company, Incorporated, a Maryland
corporation (the “Borrower”), the various financial institutions from
time to time parties thereto (the “Lenders”) and Wachovia Bank, National
Association, as administrative agent (the “Agent”).  Unless otherwise defined herein or the
context otherwise requires, terms used herein have the meanings provided in the
Credit Agreement.

 

The Borrower hereby requests that on
                                     ,
              .

 

(1)           [U.S.$] [£] [DM] [¥]
[Euro]
                                   
of the presently outstanding principal amount of the Loans originally made on
                        ,
           [and [U.S.$] [£]
[DM] [¥] [Euro] of the presently outstanding principal amount of the Loans
originally made on
                           ,
           ],

 

(2)           and all presently being
maintained as(1) [Base Rate Loans] [LIBO Rate Loans denominated in Dollars]
[LIBO Rate Loans denominated in an Alternate Currency],

 

(3)           be [converted into]
[continued as],

 

(4)           (2)[LIBO Rate Loans
denominated in Dollars having an Interest Period of
                  
months] [LIBO Rate Loans denominated in an Alternate Currency having an
Interest Period of
                    
months] [Base Rate Loans](3).

 

 

(1) Select appropriate interest rate option.

(2) Insert appropriate interest rate option.

(3) Dollars only.

 

Exhibit E

Page 1 of 2

 

The Borrower hereby:

 

(a)           certifies and warrants
that no Default has occurred and is continuing; and

 

(b)           agrees that if prior to
the time of such continuation or conversion any matter certified to herein by
it will not be true and correct at such time as if then made, it will
immediately so notify the Agent.

 

Except to the extent, if
any, that prior to the time of the continuation or conversion requested hereby
the Agent shall receive written notice to the contrary from the Borrower, each
matter certified to herein shall be deemed to be certified at the date of such
continuation or conversion as if then made.

 

The Borrower has caused this Continuation/Conversion
Notice to be executed and delivered, and the certification and warranties
contained herein to be made, by its Authorized Officer this
            day of
                      ,
         .

 

	
   

  	
  McCORMICK &
  COMPANY,

  INCORPORATED

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Title:

  
				

 

Exhibit E

Page 2 of 2

 

FORM OF OPINION OF COUNSEL TO THE
BORROWER

 

To each of the Lenders
party

to the Credit Agreement referred 

to below, and Wachovia Bank, National Association,

as Administrative Agent

 

May 30, 2003

 

Ladies and Gentlemen:

 

I am General Counsel of McCormick & Company,
Incorporated (the “Borrower”), a Maryland corporation, and have acted as
counsel in connection with the execution and delivery of that certain 364-Day
Credit Agreement, dated as of May 30, 2003 (the “Credit Agreement”), among
the Borrower, Wachovia Bank, National Association, as administrative agent (the
“Agent”), and the various financial institutions parties thereto (the
“Lenders”).  This opinion letter is
delivered to you pursuant to Section 5.1.6 of the Credit
Agreement.  Capitalized terms used
herein that are not defined herein have the respective specified meanings in
the Credit Agreement.

 

In rendering the opinions set forth below, I or a
member of my staff have examined executed originals of the Credit Agreement and
the Notes (collectively, the “Subject Documents”); the Articles of
Incorporation of the Borrower and all amendments thereto (the “Charter”); the
Bylaws of the Borrower and all amendments thereto (the “Bylaws”); and a
certificate issued by the Maryland Department of Assessments and Taxation,
dated May     , 2003, attesting to the continued corporate
existence and good standing of the Borrower in the State of Maryland.  In addition, I or a member of my staff have
examined originals or photostatic or certified copies of certain of the
corporate records and documents of the Borrower and its Subsidiaries, copies of
public documents, certificates of officers of the Borrower and public
officials, and such other documents as I have deemed necessary and appropriate
as a basis for the opinions hereinafter set forth.

 

In my examination, I have assumed the genuineness of
all signatures (other than those of the Borrower), the legal capacity of
natural persons, the authenticity of all corporate records, documents,
instruments and certificates submitted to us as originals and the conformity to
authentic original corporate records, documents, instruments and certificates
of all corporate records, documents instruments and certificates submitted to
us as certified, conformed or photostatic copies.  As to questions of fact material to my opinions, I have relied
upon representations and warranties of the parties in the Subject Documents and
the other agreements and documents contemplated therein, and on certificates of
officers of the Borrower (including those delivered pursuant to the Credit
Agreement) and of public officials.

 

I have further assumed that you have the power and
authority and have taken the corporate action necessary to execute and deliver
the Credit Agreement and to hold the Notes and that no approvals, waivers,
filings, notices or consents, governmental or non-governmental, are required
for the valid execution, delivery and performance by you of the Credit
Agreement or

 

Exhibit F

Page 1 of 3

 

to hold the Notes, and that the Credit Agreement executed by you
constitutes your legal, valid and binding obligation.

 

Based upon the foregoing and subject to the
qualifications set forth above and hereinafter, I am of the opinion that:

 

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

 

2.             The
execution, delivery and performance by the Borrower of the Subject Documents
are within the Borrower’s corporate powers, have been duly authorized by all
necessary corporate action, and do not (i) contravene the Charter or the
By-laws, (ii) violate any Federal or Maryland law, rule or regulation
applicable to the Borrower (including, without limitation, Regulations U and X
of the Board of Governors of the Federal Reserve System, insofar as the
proceeds of the Loans are used solely for the purposes set forth in, and in
accordance with the provisions of, the Credit Agreement) or (iii) result in any
breach or violation of, or constitute a default under, any agreement or
instrument set forth on the attached certificate of the Borrower.  The Subject Documents have been duly
executed and delivered on behalf of the Borrower.

 

3.             Each
of the Subject Documents has been duly executed by the Borrower and constitutes
the legal, valid and binding obligation of the Borrower, enforceable against
the Borrower in accordance with its terms.

 

4.             No
authorization or approval or other action by, and no notice to or filing with,
any Federal or Maryland governmental authority or regulatory body (other than
any applicable securities law filings) is required on behalf of the Borrower
for the due execution, delivery or performance by the Borrower of any of the
Subject Documents.

 

5.             The
Borrower is not an “investment company” within the meaning of the Investment
Company Act of 1940, as amended, or a “holding company”, or a “subsidiary
company” of a “holding company”, or an “affiliate” of a “holding company” or of
a “subsidiary company” of a “holding company”, within the meaning of the Public
Utility Company Act of 1935, as amended.

 

6.             There
is no pending or, to the best of my knowledge, threatened litigation, action,
proceeding or labor controversy affecting the Borrower or any of its
properties, business, assets or revenues which is likely to materially
adversely affect the financial condition or operations of the Borrower and its
Subsidiaries taken as a whole or which purports to affect the legality,
validity or enforceability of any of the Subject Documents to which the
Borrower is a party.

 

7.             The
New York governing law clauses of the Subject Documents, subjecting such Subject
Documents to the law of the State of New York, are valid under the laws of the
State of Maryland.

 

8.             Under
the law of the State of Maryland, the laws of the State of New York will be
applied to the Subject Documents, except to the extent that any term of such
documents or any provision of the law of the State of New York applicable to
such documents violates an

 

Exhibit F

Page 2 of 3

 

important public policy of the State of Maryland.  We have no reason to believe that any such
term violates an important public policy of the State of Maryland.

 

The foregoing opinions are subject to the following
additional qualifications:

 

(a)           The opinions expressed
herein are limited to the laws and regulations of the United States of America
and the State of Maryland.

 

(b)           My opinions regarding
the enforceability of the Subject Documents are limited by bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance or similar laws
or decisions affecting the enforcement of debtors’ obligations and creditors’
rights generally, and by general principles of equity and public policy.  My opinions are also subject to the effect
of certain laws and judicial decisions which may limit the enforceability of
certain provisions of the Subject Documents, although such limitations do not,
in my judgment, make the remedies provided therein (taken as a whole)
inadequate for the practical realization of the benefits afforded thereby.

 

The opinions expressed herein are solely for your
benefit in connection with the performance of the Subject Documents, and
without my express prior written consent, this opinion letter may not be
circulated or furnished to or relied upon by any other person, except that it
may be circulated to any prospective Assignee Lender or Agent in accordance
with the Credit Agreement and may be relied upon by any Person who, in the
future, becomes a Lender or Agent under the Credit Agreement.

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Robert W. Skelton

  
	
   

  	
  Vice President, General
  Counsel

  
	
   

  	
  & Secretary

  

 

Exhibit F

Page 3 of 3

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