Document:

Exhibit
10.1

EMPLOYMENT
AGREEMENT

This Employment Agreement (this “Agreement”) is effective as of XXXXXX (the “Effective Date”), and
is entered into by and between XXXXXX, an individual (“Executive”), and
Fleetwood Enterprises, Inc., a Delaware corporation (the “Company”).

R E C I
T A L S

WHEREAS, by entering into this Agreement, the terms of Executive’s
employment with the Company shall be governed by the terms and conditions of
this Agreement and any prior agreement between Executive and the Company or any
of the Company’s affiliated entities relating to Executive’s employment with
the Company or any of its affiliated entities shall be superseded by the terms
of this Agreement except to the extent set forth herein.

NOW, THEREFORE, in consideration of the foregoing, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged by the parties hereto, the parties hereto agree as follows:

A G R E
E M E N T

1.         Employment.  As of the Effective Date, the Company hereby
employs Executive to serve in the capacity of Vice President – [Title                    ].  The Company’s Board of Directors (the “Board”)
and/or the Company’s Chief Executive Officer (the “CEO”) may provide other
designations of title to Executive as the Board and/or CEO, in their
discretion, may deem appropriate.

Executive agrees to perform the duties and functions as assigned by the
CEO and/or by the Board of Directors. 
Except for legal holidays, vacations and absences due to temporary
illness, Executive shall devote his time, attention and energies to the
business of the Company on a full-time basis. 
Executive represents and warrants to the Company that he is under no
restriction, limitation or other prohibition to perform his duties as described
herein.

2.         Employment Compensation And Benefits.

(a)       Base Salary.  Executive’s initial base salary shall be at
the annual rate of XXXXXXXXX (Dollars)
($XXXXXXX) (the “Base Salary”), which
shall be payable at least as frequently as monthly and subject to deductions
and withholdings required by applicable law and as customary in respect of the
Company’s salaried employees.  The
Company, on the basis of Executive’s performance and the Company’s financial
success and progress, shall review this salary level at least annually.

(b)       Incentive Compensation.  As additional compensation to provide
incentives for Executive to extend efforts which will assist in increasing the
profits of the Company, Executive shall be eligible to receive incentive
compensation based on achieving individual and organizational performance
objectives in accordance with the terms and conditions of the Company’s
management compensation plan, implemented at the beginning of fiscal year 2002,
and as may be modified from time to time.

(c)       Vacation.  Executive shall be entitled to annual
vacations in accordance with the Company’s vacation policies in effect during
the term of this Agreement.

(d)       Expense Reimbursement.  The Company shall reimburse Executive for all
reasonable amounts actually expended by Executive in the course of performing
his duties for the Company and in accordance with any Company-established
guidelines where Executive tenders receipts or other documentation reasonably
substantiating the amounts as required by the Company.

(e)       Other Benefits.  Except as otherwise provided in this
Agreement, Executive shall be entitled to receive all of the rights, benefits
and privileges under any retirement, pension, profit-sharing, group medical
insurance, group dental insurance, group-term life insurance, disability
insurance and other employee benefit plan or program of the Company which may
be now in effect or hereafter adopted, to the extent that Executive is eligible
under the provisions thereof.

3.         Termination.

(a)       At Will.  The Company shall employ Executive at will,
and either Executive or the Company may terminate Executive’s employment with
the Company at any time and for any reason, with or without cause.

(b)       Qualifying Termination.  Executive’s termination shall be considered a
“Qualifying Termination” unless:

(i)        Executive voluntarily
terminates his employment with the Company and its affiliated companies.  [Executive,
however, shall not be considered to have voluntarily terminated his
employment with the Company and its affiliated companies if his overall
targeted total cash compensation (base salary plus targeted short term bonus),
(TCC), is reduced or adversely modified in any material respect
(unless the reduction or modification applies generally to similarly situated
executives in the Company) or his position is modified or changed so that he is
no longer an officer of the Company and he elects to terminate his employment
within sixty (60) days following such reduction, modification or change.]

(ii)       The termination is on
account of Executive’s death or Disability. 
“Disability” shall mean a physical or mental incapacity as a result of
which Executive becomes unable to continue the performance of his
responsibilities for the Company and its affiliated companies and which, at
least three (3) months after its commencement, is determined to be total and
permanent by a physician agreed to by the Company and Executive, or in the
event of Executive’s inability to designate a physician, his legal
representative.  In the absence of
agreement between the Company and Executive, each party shall nominate a
qualified physician and the two physicians so nominated shall select a third
physician who shall make the determination as to Disability.

 2
 

(iii)      Executive is involuntarily
terminated for “Cause.”  For this
purpose, “Cause” shall include but not be limited to:

(a)       Executive’s
refusal to comply with a lawful instruction of the Board or Executive’s
immediate supervisor, which refusal is not remedied by Executive within a
reasonable period of time after his receipt of written notice from the Company
identifying the refusal;

(b)       Executive’s engaging in
gross misconduct;

(c)       Executive’s act or acts of
personal dishonesty which result in Executive’s personal enrichment at the
expense of the Company or any of its affiliated companies; or

(d)       Executive’s
conviction of any misdemeanor involving an act of moral turpitude or any
felony; or

(e)       Executive’s
failure to perform his duties in a satisfactory manner.  Executive must be provided written notice of
the unsatisfactory performance and provided at least ninety (90) days to
improve his performance.

(iv)      Executive ceases to be
employed by the Company due to the sale or acquisition of all of the equity
interests in, or substantially all of the assets of, a subsidiary or division
of the Company with which Executive is affiliated, or in connection with the
merger of such a subsidiary or division, and this Agreement is assumed in
writing or by operation of law by such acquiring or surviving person or entity
or an affiliate thereof.

(c)       Return of Materials.  In the event of any termination of
Executive’s employment for any reason whatsoever, Executive shall promptly
deliver to the Company all Company property, including, but not limited to,
documents, data, and other information pertaining to Confidential Information,
as defined below.  Executive shall not
take with him any documents or other information, or any reproduction, summary
or excerpt thereof, containing or pertaining to any Confidential Information.

4.                          Change in Control.

(a)       Statement of Purpose.  The Company believes that it is in the best
interest of the Company and its stockholders to foster Executive’s objectivity
in making decisions with respect to any pending or threatened Change in Control
of the Company and to ensure that the Company will have the continued
dedication and availability of Executive, notwithstanding the possibility,
threat or occurrence of a Change in Control. 
The Company believes that these goals can best be accomplished by
alleviating certain of the risks and uncertainties with regard to Executive’s
financial and professional security that would be created by a pending or
threatened Change in Control and that inevitably would distract Executive and
could impair his ability to objectively perform his duties for and on behalf of
the Company.  Accordingly, the Company
believes that it is appropriate and in the best interest of the Company and its
stockholders to provide to Executive compensation arrangements upon a Change in
Control that lessen Executive’s financial risks and uncertainties and that are
reasonably competitive with those of other corporations.  The purpose of this provision is to provide
that, in the event of a “Change in Control,” Executive may become entitled to
receive certain additional benefits, as described herein, in the event of his
termination under specified circumstances.

 3
 

(b)       Definition of Change in
Control.  As used in this Agreement,
the phrase “Change in Control” shall mean:

(i)        The acquisition (other
than from the Company) by any person, entity or “group,” within the meaning of
Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”) (excluding, for this purpose, the Company or its
subsidiaries, or any executive benefit plan of the Company or its subsidiaries
which acquires beneficial ownership of voting securities of the Company), of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of twenty-five percent (25%) or more of either the
then-outstanding shares of common stock or the combined voting power of the
Company’s then-outstanding voting securities entitled to vote generally in the
election of directors; or

(ii)       Individuals who, as of the
date hereof, constitute the Board of Directors of the Company (as of the date
hereof the “Incumbent Board”) cease for any reason to constitute at least a
majority of the Board of Directors of the Company, provided that any person
becoming a director subsequent to the date hereof whose election, or nomination
for election by the Company’s stockholders, is or was approved by a vote of at
least a majority of the directors then comprising the Incumbent Board (other
than an election or nomination of an individual whose initial assumption of
office is in connection with an actual or threatened election contest relating
to the election of the Directors of the Company) shall be, for purposes of this
Agreement, considered as though such person were a member of the Incumbent
Board; or

(iii)      Approval by the stockholders
of the Company of a reorganization, merger or consolidation with any other
person, entity or corporation, other than

(x)        a merger or consolidation
which would result in the voting securities of the Company outstanding
immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of another entity)
more than fifty percent (50%) of the combined voting power of the voting
securities of the Company or such other entity outstanding immediately after
such merger or consolidation, or

(y)       a merger or consolidation
effected to implement a recapitalization of the Company (or similar
transaction) in which no person acquires twenty-five percent (25%) or more of
the combined voting power of the Company’s then outstanding voting securities;
or

(iv)      Approval by the stockholders
of the Company of a plan of complete liquidation of the Company or an agreement
for the sale or other disposition by the Company of all or substantially all of
the Company’s assets.

(c)       Certain Terminations
Following Change in Control.  If,
within twelve (12) months following a Change in Control, the employment of
Executive is terminated (i) by the Company, other than for Cause or by reason
of Executive’s death, or Disability or retirement, or (ii) by Executive for
Good Reason, such termination shall be conclusively considered a “Qualifying
Termination” based on Change in Control. 
“Good Reason” means, following a Change in Control, the occurrence of a
change in Executive’s compensation; health insurance or retirement benefits;
job authority, duties or responsibilities; or location of employment, which in
any such cases is materially adverse to Executive.

 4
 

5.                          Severance Payment and Benefits.

(a)       If Executive’s employment
is terminated as a result of a Qualifying Termination as defined in Sections 3b
and 4(c), and if Executive delivers a fully-executed release and waiver of
all claims against the Company, then, upon expiration of any applicable
revocation period contained in the release and waiver, the Company shall pay or
provide Executive the following Severance Payment and benefits based on
Executive’s eligibility as described below:

(i)        As eligible, Executive
shall receive the Severance Payment, as defined below, which shall be payable
in equal monthly installments beginning on the first day of the first full
month and continuing on the first day of each month thereafter during the
Severance Period.  The Severance Payment
is in lieu of any severance payment benefits which otherwise may at that time
be available under the Company’s applicable policies and Executive shall be
entitled to receive whatever additional severance payment benefits, if any, for
which he may qualify according to the provisions of this Agreement regarding
Change in Control.

As used herein, “Monthly Severance Payment” shall mean
the monthly installment amount of the Base Salary of Executive at the time of
Executive’s termination plus the monthly average of the short-term incentive
payments (quarterly bonus) actually paid to Executive during the twelve (12)
months immediately preceding Executive’s termination.

Executive will be eligible for a number of Monthly
Severance Payments based on the schedule below:

	
  Length of Service

  	
   

  	
  Monthly Severance Payments

  
	
   

  	
   

  	
   

  
	
  New hire up to
  six months

  	
   

  	
  0

  
	
   

  	
   

  	
   

  
	
  Six months up to
  12 months

  	
   

  	
  3

  
	
   

  	
   

  	
   

  
	
  12 months up to
  18 months

  	
   

  	
  6

  
	
   

  	
   

  	
   

  
	
  18 months up to
  24 months

  	
   

  	
  9

  
	
   

  	
   

  	
   

  
	
  24 months or
  more

  	
   

  	
  12

  

 

Length of Service is the number of full months
immediately before the date of Executive’s Qualifying Termination during which
Executive has been continuously employed by the Company or any of its
affiliated companies.  Each Monthly
Severance Payment shall be subject to deductions and withholdings required by
applicable law.  As used herein, “Severance
Period” shall mean that period beginning upon Executive’s Qualifying
Termination and ending upon the lapse thereafter of the number of months equal
to the number of Monthly Severance Payments.

 5
 

(ii)       During the Severance Period
and to the extent reasonably practicable, Executive shall be entitled to
receive benefits comparable to those which had been made available to him
(including his family) under the Associate Healthcare Management Plan before
the Qualifying Termination.  To the
extent reasonably practicable, these benefits shall be continued to Executive
in a comparable manner, at a comparable cost and at a comparable level as
provided to Executive (including his family) immediately prior to the
Qualifying Termination.  In some cases,
benefits may be converted to a reasonably similar private plan – provided that
the Company pays all additional costs associated with conversion.  The provision of these benefits shall be
earlier terminated or reduced, as applicable, if and to the extent Executive
receives comparable benefits as a result of concurrent coverage through another
program.  Participation in all other
benefits plans including group life insurance, personal accident insurance, and
disability insurance, etc., will cease as of the date of termination.

(iii)      Any and all of Executive’s
unvested stock options shall immediately become fully vested and exercisable
according to the terms and conditions contained in the equity incentive plan(s)
pursuant to which such options were granted.

(b)       In the event of a
Qualifying Termination as a result of a Change in Control, as defined in
Section 4 hereof, an additional twelve (12) months of Severance Payments and
benefits as calculated and described in Section 5(a) (i), (ii) and (iii) above
will be provided to Executive.  In the
event that Executive becomes entitled to receive a Severance Payment in
accordance with the provisions of this Section 5(b), and if such Severance
Payment and any other benefits or payments (including transfers of property)
that Executive receives, or is to receive, pursuant to this Agreement or any
other agreement, plan or arrangement with the Company in connection with a
Change in Control of the Company (“Other Benefits”) shall be subject to the tax
imposed pursuant to Section 4999, or any successor thereto, of the Internal
Revenue Code of 1986, as amended, (the “Code”) or any comparable provision of
state law (an “Excise Tax”), the following rules shall apply:

(i)        The Company shall pay to
Executive, within thirty (30) days after the Executive’s Qualifying
Termination, an additional amount (the “Gross-Up Payment”) such that the net
amount retained by Executive, after deduction of any Excise Tax with respect to
the Severance Payment or the Other Benefits and any federal, state, and local
income tax, FICA tax, and Excise Tax upon such Gross-Up Payment, is equal to
the amount that would have been retained by Executive if such Excise Tax were
not applicable.  It is intended that Executive
shall not suffer any loss or expense resulting from the assessment of any
Excise Tax or the Company’s reimbursement of Executive for payment of any such
Excise Tax.

(ii)       For purposes of determining
whether any of the Severance Payments or Other Benefits will be subject to an
Excise Tax and the amount of such Excise Tax, (i) any other payments or
benefits received or to be received by Executive in connection with a Change in
Control of the Company or Executive’s termination of employment (whether
pursuant to the terms of this Agreement or any other plan, arrangement or
agreement with the Company, any person whose actions result in a Change in
Control or any person affiliated with the Company or such person) shall be
treated as “parachute payments” within the

 6
 

meaning of Section
280G(b)(2) of the Code (or any successor thereto), and all “excess parachute
payments” within the meaning of Section 280G(b)(1) of the Code (or any
successor thereto) shall be treated as subject to the Excise Tax, unless in the
opinion of tax counsel selected by the Company’s independent auditors and
acceptable to Executive such other payments or benefits (in whole or in part)
do not constitute parachute payments, or such excess parachute payments (in
whole or in part) represent reasonable compensation for services actually
rendered within the meaning of Section 280G(b)(4) of the Code (or any successor
thereto), (ii) the amount of the Severance Payments and Other Benefits which
shall be treated as subject to the Excise Tax shall be equal to the lesser of
(A) the total amount of the Severance Payments or Other Benefits or (B) the
amount of excess parachute payments within the meaning of Sections 280G(b)(1)
and (4) of the Code (or any successor or successors thereto), after applying
clause (i), above, and (iii), the value of any non-cash benefits or any
deferred payment or benefit shall be determined by the Company’s independent
auditors in accordance with the principles of Sections 280G(d)(3) and (4) of
the Code (or any successor or successors thereto).

(iii)      For purposes of determining
the amount of the Gross-Up Payment, Executive shall be deemed to pay federal
income taxes at the highest marginal rate of federal income taxation in the
calendar year in which the Gross-Up Payment is to be made and state and local
income taxes at the highest marginal rates of taxation in the state and
locality of Executive’s residence on the date of the Executive’s Qualifying
Termination, net of the maximum reduction in federal income taxes which could
be obtained from deduction of such state and local taxes.

(iv)      In the event that the Excise
Tax is subsequently determined to be less than the amount taken into account
hereunder at the time of the Executive’s Qualifying Termination, the Executive
shall repay to the Company, at the time that the amount of such reduction in
Excise Tax is finally determined, the portion of the Gross-Up Payment
attributable to such reduction plus interest on the amount of such repayment at
the rate provided in Section 1274(b)(2)(B) of the Code (or any successor thereto)
(the “Applicable Rate”).  In the event
that the Excise Tax is determined to exceed the amount taken into account
hereunder at the time of such Qualifying Termination (including by reason of
any payment the existence or amount of which cannot be determined at the time
of the Gross-Up Payment), the Company shall make an additional Gross-Up Payment
in respect of such excess (plus interest, determined at the Applicable Rate,
payable with respect to such excess) at the time that the amount of such excess
is finally determined.

6.         Compliance
with Section 409A. 
Notwithstanding any provision of this Agreement to the contrary, if, at
the time of Executive’s termination of employment with the Company, Executive
is a “specified employee” as defined in Section 409A of the Code, and one or
more of the payments or benefits received or to be received by Executive
pursuant to this Agreement would constitute deferred compensation subject to
Section 409A, no such payment or benefit will be provided under this Agreement
until the earliest of (a) the date which is six (6) months after Executive’s “separation
from service” for any reason, other than death or “disability” (as such terms
are used in Section 409A(a)(2) of the Code), (b) the date of Executive’s death
or “disability” (as such term is used in Section 409A(a)(2)(C) of the Code) or
(c) the effective date of a “change in the ownership or effective control” of
the Company (as such term is used in Section 409A(a)(2)(A)(v) of the
Code).  The provisions of this

 7
 

Section 6 shall only
apply to the extent required to avoid Executive’s incurrence of any penalty tax
or interest under Section 409A of the Code or any regulations or Treasury
guidance promulgated thereunder.  In
addition, if any provision of this Agreement would cause Executive to incur any
penalty tax or interest under Section 409A of the Code or any regulations or
Treasury guidance promulgated thereunder, the Company may reform such provision
to maintain to the maximum extent practicable the original intent of the
applicable provision without violating the provisions of Section 409A of the
Code.

7.         Nondisclosure of
Confidential Information.  Executive acknowledges that during the term of his employment with the Company, he
will have access to and become acquainted with information of a confidential,
proprietary or secret nature which is or may be either applicable to, or
related in any way to, the present or future business of the Company, the
research and development or investigation of the Company, or the business of
any customer of the Company (“Confidential Information”).  For example, Confidential Information
includes, but is not limited to, devices, secret inventions, processes and
compilations of information, records, specifications, designs, plans,
proposals, software, codes, marketing and sales programs, financial
projections, cost summaries, pricing formula, and all concepts or ideas,
materials or information related to the business, products or sales of the
Company and its customers and
vendors.  Executive shall not disclose any Confidential
Information, directly or indirectly, or use such information in any way, either
during the term of this Agreement or at any time thereafter, except as required
in the course of employment with the Company. 
Executive also agrees to
comply with the Company’s policies and regulations, as established from time to
time for the protection of its Confidential Information, including, for
example, executing the Company’s standard confidentiality agreements.  This section shall survive termination of
this Agreement.

8.         Non-Solicitation.  Executive agrees that so long as he is
employed by the Company and for a period of twenty-four (24) months after
termination of his employment for any reason, he shall not (a) directly or
indirectly solicit, induce or attempt to solicit or induce any employee of the
Company or any of its affiliated companies to discontinue his employment with
the Company; (b) usurp any opportunity of the Company or any of its
affiliated companies of which Executive became aware during his tenure at the
Company or which is made available to him on the basis of the belief that
Executive is still employed by the Company; or (c) directly or indirectly
solicit or induce or attempt to influence any person or business that is an
account, customer or client of the Company or any of its affiliated companies
to restrict or cancel the business of any such account, customer or client with
the Company or any of its affiliated companies.  This section shall survive
termination of this Agreement.

9.         Successors.

(a)       This
Agreement is personal to Executive, and without the prior written consent of
the Company shall not be assignable by Executive other than by will or the laws
of descent and distribution.  This
Agreement shall inure to the benefit of and be enforceable by Executive’s legal
representatives.

(b)       The rights and obligations
of the Company under this Agreement shall inure to the benefit of and shall be
binding upon the successors and assigns of the Company.

 8
 

10.      Governing Law.  This Agreement is made and entered into in
the State of California, and the internal laws of California shall govern its
validity and interpretation in the performance by the parties hereto of their
respective duties and obligations hereunder.

11.      Modifications.  This Agreement may be amended or modified
only by an instrument in writing executed by all of the parties hereto.

12.      Entire
Agreement.  Except as otherwise
set forth herein, this Agreement supersedes any and all prior written or oral
agreements between Executive and the Company, including but not limited to any
and all employment agreements and change in control agreements.  This Agreement contains the entire
understanding of the parties hereto with respect to the terms and conditions of
Executive’s employment with the Company; provided, however, that
this Agreement is not intended to supersede any agreements that Executive may
previously have entered into regarding the protection of trade secrets and
confidential information.

13.      Dispute Resolution

(a)       Any
controversy or dispute between the parties involving the construction,
interpretation, application or performance of the terms, covenants, or
conditions of this Agreement, the employment of Executive or in any way arising
under this Agreement (a “Covered Dispute”) shall, on demand by either of the
parties be referenced pursuant to the procedures described in California Code
of Civil Procedure (“CCP”) Sections 638, et
seq., as they may be amended from time to time (or such procedures
as nearly the same as may be available under the laws of California, the “Reference
Procedures”), to a retired Judge from the superior court of California for the
County of Riverside (the “Venue County”) for a decision.

(b)       The Reference Procedures
shall be commenced by a joint stipulation filed in the Venue County Court or by
either party filing in the superior court of Venue County a motion pursuant to
CCP Section 638 (or such procedures as nearly the same as may be available
under the laws of California, a “Motion”). 
The referee shall be a Judge from the list of retired superior court
Judges from the Venue County who have made themselves available for trial or
settlement of civil litigation under said Reference Procedures.  If the parties hereto are unable to agree on
the designation of a particular retired superior court Judge of the Venue
County, or the designated Judge is unavailable or unable to serve in such
capacity, request shall be made that the Presiding or Assistant Presiding Judge
of the superior court of the Venue County appoint as referee a retired superior
court Judge from the aforementioned list.

(c)       Except as hereafter agreed
by the parties, the referee shall apply the internal law of the State of
California in deciding the issues submitted hereunder.  Each of the parties reserves its respective
rights to allege and assert in such pleadings all claims, causes of action,
contentions and defenses which it may have arising out of or relating to the
general subject matter of the Covered Dispute that is being determined pursuant
to the Reference Procedures.  Reasonable
notice of any motions before the referee shall be given, and all matters shall
be set at the convenience of the referee. 
Discovery shall be conducted as the parties agree or as allowed by the
referee.  Unless waived by each of the
parties, a reporter shall be present at all proceedings before the
referee.  By agreeing to this procedure,
the parties expressly waive their right to a jury trial.

 9
 

(d)       It is the parties’
intention by this Section 13 that all issues of fact and law and all matters of
a legal and equitable nature related to any Covered Dispute will be submitted
for determination by a referee designated as provided herein.  Accordingly, the parties hereby stipulate
that a referee designated as provided herein shall have all powers of a Judge
of the superior court including, without limitation, the power to grant
equitable and interlocutory and permanent injunctive relief.

(e)       Each of the parties
specifically consents and agrees to (i) the exercise of jurisdiction over
his person by a referee designated as provided herein with respect to any and
all Covered Disputes; (ii) the personal jurisdiction of the California courts
with respect to any appeal or review of the decision of any such referee, and
(iii) venue for any dispute subject to this Section 13 shall be in
the County of Riverside.

(f)        Each of the parties
acknowledges that the decision by a referee designated as provided herein shall
be a basis for a judgment as provided in CCP Section 644 and shall be subject
to exception and review as provided in CCP Section 645, or such procedures as
nearly the same as may be available under the laws of California.

(g)       The Company shall pay all
fees and costs incurred by Executive in connection with the Reference
Procedures for a Covered Dispute other than attorneys’ fees incurred by
Executive.

14.      Notices.  Any notice or communications required or
permitted to be given to the parties hereto shall be delivered personally or be
sent by United States registered or certified mail, postage prepaid and return
receipt requested, and addressed or delivered as follows, or at such other
addresses the party addressed may have substituted by notice pursuant to this
Section:

	
  To the Company:

  	
   

  	
  To Executive:

  
	
   

  	
   

  	
   

  
	
  Fleetwood
  Enterprises, Inc.

  	
   

  	
  (Name)

  
	
  3125 Myers
  Street

  	
   

  	
  (Home Address)

  
	
  Riverside,
  California 92503-5527

  	
   

  	
  (City, State, Zip)

  
	
  Attn: General
  Counsel

  	
   

  	
   

  

 

15.      Captions.  The captions of this Agreement are inserted
for convenience and do not constitute a part hereof.

16.      Severability.  In case any one or more of the provisions
contained in this Agreement shall for any reason be held to be invalid, illegal
or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this Agreement, but
this Agreement shall be construed as if such invalid, illegal or unenforceable
provision had never been contained herein and there shall be deemed substituted
for such invalid, illegal or unenforceable provision such other provision as
will most nearly accomplish the intent of the parties to the extent permitted
by the applicable law.  In case this
Agreement, or any one or more of the provisions hereof, shall be held to be invalid,
illegal or unenforceable within any governmental jurisdiction or subdivision
thereof, this Agreement or any such provision thereof shall not as a
consequence thereof be deemed to be invalid, illegal or unenforceable in any
other governmental jurisdiction or subdivision thereof.

 10
 

17.      Counterparts. 
This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which shall together constitute
one in the same Agreement.

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

	
  

  	
   

  	
   

  
	
   

  	
  (Name)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FLEETWOOD
  ENTERPRISES, INC.,

  
	
   

  	
  a Delaware
  corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  
	
   

  	
   

  	
  Title: 

  
					

 

 11Exhibit
10.1

CREDIT AGREEMENT

among

UNIVERSAL AMERICAN FINANCIAL CORP.,

ONE OR MORE LENDING INSTITUTIONS,

and

BANK
OF AMERICA, N.A.,

as
the Administrative Agent

and the L/C Issuer

Dated as of January 18, 2007

$50,000,000

BANC
OF AMERICA SECURITIES LLC,

as Sole Lead Arranger and Book Manager

TABLE OF CONTENTS

	
  

  	
   

  	
   

  	
   

  	
  Page

  
	
  SECTION 1.     Amount and
  Terms of Credit.

  	
   

  	
  1

  
	
  1.01

  	
   

  	
  Commitments.

  	
   

  	
  1

  
	
  1.02

  	
   

  	
  Minimum Amount of Each Borrowing; Maximum Number of
  Borrowings.

  	
   

  	
  1

  
	
  1.03

  	
   

  	
  Notice of Borrowing.

  	
   

  	
  2

  
	
  1.04

  	
   

  	
  Disbursement of Funds.

  	
   

  	
  2

  
	
  1.05

  	
   

  	
  Notes.

  	
   

  	
  3

  
	
  1.06

  	
   

  	
  Conversions.

  	
   

  	
  3

  
	
  1.07

  	
   

  	
  Letters of Credit.

  	
   

  	
  4

  
	
  1.08

  	
   

  	
  Pro Rata Borrowings.

  	
   

  	
  10

  
	
  1.09

  	
   

  	
  Interest.

  	
   

  	
  10

  
	
  1.10

  	
   

  	
  Interest Periods.

  	
   

  	
  11

  
	
  1.11

  	
   

  	
  Increased Costs, Illegality, etc.

  	
   

  	
  11

  
	
  1.12

  	
   

  	
  Compensation.

  	
   

  	
  13

  
	
  1.13

  	
   

  	
  Change of Lending Office.

  	
   

  	
  14

  
	
  1.14

  	
   

  	
  Replacement of Banks.

  	
   

  	
  14

  
	
  SECTION 2.     Fees;
  Termination of Commitments.

  	
   

  	
  15

  
	
  2.01

  	
   

  	
  Fees.

  	
   

  	
  15

  
	
  2.02

  	
   

  	
  Termination of Commitments.

  	
   

  	
  15

  
	
  SECTION 3.     Payments.

  	
   

  	
  15

  
	
  3.01

  	
   

  	
  Termination or Reduction of the Total Revolving Loan
  Commitment.

  	
   

  	
  15

  
	
  3.02

  	
   

  	
  Voluntary Prepayments.

  	
   

  	
  15

  
	
  3.03

  	
   

  	
  Mandatory Commitment Reductions.

  	
   

  	
  16

  
	
  3.04

  	
   

  	
  Method and Place of Payment.

  	
   

  	
  16

  
	
  3.05

  	
   

  	
  Net Payments.

  	
   

  	
  17

  
	
  SECTION 4.     Conditions
  Precedent.

  	
   

  	
  19

  
	
  4.01

  	
   

  	
  Effectiveness; Notes.

  	
   

  	
  19

  
	
  4.02

  	
   

  	
  No Default; Representations and Warranties.

  	
   

  	
  20

  
	
  4.03

  	
   

  	
  Officer’s Certificate.

  	
   

  	
  20

  
	
  4.04

  	
   

  	
  Opinion of Counsel.

  	
   

  	
  20

  
	
  4.05

  	
   

  	
  Corporate Proceedings.

  	
   

  	
  20

  
	
  4.06

  	
   

  	
  No Material Adverse Effect.

  	
   

  	
  20

  
	
  4.07

  	
   

  	
  Litigation.

  	
   

  	
  20

  
	
  4.08

  	
   

  	
  Subsidiary Guaranty.

  	
   

  	
  21

  
	
  4.09

  	
   

  	
  [Intentionally Omitted].

  	
   

  	
  21

  
	
  4.10

  	
   

  	
  [Intentionally Omitted].

  	
   

  	
  21

  
	
  4.11

  	
   

  	
  [Intentionally Omitted].

  	
   

  	
  21

  
	
  4.12

  	
   

  	
  [Intentionally Omitted].

  	
   

  	
  21

  
	
  4.13

  	
   

  	
  [Intentionally Omitted].

  	
   

  	
  21

  
	
  4.14

  	
   

  	
  Financial Statements; Projections.

  	
   

  	
  21

  
	
  4.15

  	
   

  	
  Approvals, etc.

  	
   

  	
  21

  
	
  4.16

  	
   

  	
  Indebtedness.

  	
   

  	
  21

  
	
  4.17

  	
   

  	
  Payment of Fees.

  	
   

  	
  21

  
	
  4.18

  	
   

  	
  Notice of Borrowing.

  	
   

  	
  22

  
	
  4.19

  	
   

  	
  Insurance Policies.

  	
   

  	
  22

  
	
  4.20

  	
   

  	
  Capital Structure.

  	
   

  	
  22

  
	
  4.21

  	
   

  	
  Ratings.

  	
   

  	
  22

  
	
  SECTION 5.     Representations,
  Warranties and Agreements.

  	
   

  	
  22

  
	
  5.01

  	
   

  	
  Corporate Status.

  	
   

  	
  22

  

 

 i
 

 

	
  5.02

  	
   

  	
  Corporate Power and Authority.

  	
   

  	
  22

  
	
  5.03

  	
   

  	
  No Contravention of Laws, Agreements or
  Organizational Documents.

  	
   

  	
  23

  
	
  5.04

  	
   

  	
  Litigation and Contingent Liabilities.

  	
   

  	
  23

  
	
  5.05

  	
   

  	
  Use of Proceeds; Margin Regulations.

  	
   

  	
  23

  
	
  5.06

  	
   

  	
  Approvals.

  	
   

  	
  23

  
	
  5.07

  	
   

  	
  Investment Company Act.

  	
   

  	
  24

  
	
  5.08

  	
   

  	
  [Intentionally Omitted].

  	
   

  	
  24

  
	
  5.09

  	
   

  	
  True and Complete Disclosure; Projections and
  Assumptions.

  	
   

  	
  24

  
	
  5.10

  	
   

  	
  [Intentionally Omitted].

  	
   

  	
  24

  
	
  5.11

  	
   

  	
  Financial Condition; Financial Statements.

  	
   

  	
  24

  
	
  5.12

  	
   

  	
  [Intentionally Omitted].

  	
   

  	
  25

  
	
  5.13

  	
   

  	
  Tax Returns and Payments.

  	
   

  	
  25

  
	
  5.14

  	
   

  	
  Compliance with ERISA.

  	
   

  	
  25

  
	
  5.15

  	
   

  	
  Subsidiaries.

  	
   

  	
  26

  
	
  5.16

  	
   

  	
  Intellectual Property, etc.

  	
   

  	
  27

  
	
  5.17

  	
   

  	
  Pollution and Other Regulations.

  	
   

  	
  27

  
	
  5.18

  	
   

  	
  Labor Relations; Collective Bargaining Agreements.

  	
   

  	
  27

  
	
  5.19

  	
   

  	
  [Intentionally Omitted].

  	
   

  	
  27

  
	
  5.20

  	
   

  	
  Indebtedness.

  	
   

  	
  27

  
	
  5.21

  	
   

  	
  Compliance with Statutes, etc.

  	
   

  	
  27

  
	
  5.22

  	
   

  	
  Insurance Licenses.

  	
   

  	
  27

  
	
  SECTION 6.     Affirmative
  Covenants.

  	
   

  	
  28

  
	
  6.01

  	
   

  	
  Information Covenants.

  	
   

  	
  28

  
	
  6.02

  	
   

  	
  Books, Records and Inspections.

  	
   

  	
  31

  
	
  6.03

  	
   

  	
  Insurance.

  	
   

  	
  31

  
	
  6.04

  	
   

  	
  Payment of Taxes.

  	
   

  	
  31

  
	
  6.05

  	
   

  	
  Corporate Franchises.

  	
   

  	
  31

  
	
  6.06

  	
   

  	
  Compliance with Statutes, etc.

  	
   

  	
  32

  
	
  6.07

  	
   

  	
  ERISA.

  	
   

  	
  32

  
	
  6.08

  	
   

  	
  Performance of Obligations.

  	
   

  	
  32

  
	
  6.09

  	
   

  	
  Good Repair.

  	
   

  	
  33

  
	
  6.10

  	
   

  	
  End of Fiscal Years; Fiscal Quarters.

  	
   

  	
  33

  
	
  6.11

  	
   

  	
  Maintenance of Licenses and Permits.

  	
   

  	
  33

  
	
  6.12

  	
   

  	
  Register.

  	
   

  	
  33

  
	
  6.13

  	
   

  	
  Ratings.

  	
   

  	
  33

  
	
  SECTION 7.     Negative
  Covenants.

  	
   

  	
  34

  
	
  7.01

  	
   

  	
  Changes in Business.

  	
   

  	
  34

  
	
  7.02

  	
   

  	
  Consolidation, Merger, Sale or Purchase of Assets.

  	
   

  	
  34

  
	
  7.03

  	
   

  	
  Liens.

  	
   

  	
  36

  
	
  7.04

  	
   

  	
  Indebtedness.

  	
   

  	
  37

  
	
  7.05

  	
   

  	
  Capital Expenditures.

  	
   

  	
  39

  
	
  7.06

  	
   

  	
  Advances, Investments and Loans.

  	
   

  	
  39

  
	
  7.07

  	
   

  	
  Modifications of Agreements, etc.

  	
   

  	
  41

  
	
  7.08

  	
   

  	
  Dividends, Restricted Payments, etc.

  	
   

  	
  41

  
	
  7.09

  	
   

  	
  Transactions with Affiliates.

  	
   

  	
  42

  
	
  7.10

  	
   

  	
  Leverage Ratio.

  	
   

  	
  42

  
	
  7.11

  	
   

  	
  Fixed Charge Coverage Ratio.

  	
   

  	
  42

  
	
  7.12

  	
   

  	
  Minimum Risk Based Capital.

  	
   

  	
  43

  
	
  7.13

  	
   

  	
  Minimum Consolidated Net Worth.

  	
   

  	
  43

  
	
  7.14

  	
   

  	
  Minimum Combined Adjusted Statutory Capital and
  Surplus.

  	
   

  	
  43

  
	
  7.15

  	
   

  	
  Issuance of Stock.

  	
   

  	
  43

  
	
  7.16

  	
   

  	
  Creation of Subsidiaries.

  	
   

  	
  43

  

 

 ii
 

 

	
  7.17

  	
   

  	
  Partnership Agreements.

  	
   

  	
  44

  
	
  SECTION 8.     Events of
  Default.

  	
   

  	
  44

  
	
  8.01

  	
   

  	
  Payments.

  	
   

  	
  44

  
	
  8.02

  	
   

  	
  Representations, etc.

  	
   

  	
  44

  
	
  8.03

  	
   

  	
  Covenants.

  	
   

  	
  44

  
	
  8.04

  	
   

  	
  Default Under Other Agreements.

  	
   

  	
  44

  
	
  8.05

  	
   

  	
  Bankruptcy, etc.

  	
   

  	
  44

  
	
  8.06

  	
   

  	
  ERISA.

  	
   

  	
  45

  
	
  8.07

  	
   

  	
  Invalidity of Credit Documents.

  	
   

  	
  45

  
	
  8.08

  	
   

  	
  [Intentionally Omitted]; or

  	
   

  	
  45

  
	
  8.09

  	
   

  	
  Judgments.

  	
   

  	
  45

  
	
  8.10

  	
   

  	
  Remedies Upon Event of Default.

  	
   

  	
  46

  
	
  8.11

  	
   

  	
  Application of Funds.

  	
   

  	
  46

  
	
  SECTION 9.     Definitions.

  	
   

  	
  47

  
	
  SECTION 10.     The
  Administrative Agent.

  	
   

  	
  65

  
	
  10.01

  	
   

  	
  Appointment.

  	
   

  	
  65

  
	
  10.02

  	
   

  	
  Delegation of Duties.

  	
   

  	
  65

  
	
  10.03

  	
   

  	
  Liability of the Administrative Agent.

  	
   

  	
  65

  
	
  10.04

  	
   

  	
  Reliance by the Administrative Agent.

  	
   

  	
  66

  
	
  10.05

  	
   

  	
  Notice of Default.

  	
   

  	
  66

  
	
  10.06

  	
   

  	
  Credit Decision; Disclosure of Information by the
  Administrative Agent.

  	
   

  	
  66

  
	
  10.07

  	
   

  	
  Indemnification.

  	
   

  	
  67

  
	
  10.08

  	
   

  	
  The Administrative Agent in its Individual Capacity.

  	
   

  	
  67

  
	
  10.09

  	
   

  	
  Successor Administrative Agent.

  	
   

  	
  68

  
	
  10.10

  	
   

  	
  Administrative Agent May File Proofs of Claim.

  	
   

  	
  68

  
	
  10.11

  	
   

  	
  Other Agents; Arrangers and Managers.

  	
   

  	
  69

  
	
  SECTION 11.     Miscellaneous.

  	
   

  	
  69

  
	
  11.01

  	
   

  	
  Payment of Expenses and Taxes; Indemnification by
  the Borrower.

  	
   

  	
  69

  
	
  11.02

  	
   

  	
  Right of Setoff.

  	
   

  	
  70

  
	
  11.03

  	
   

  	
  Notices.

  	
   

  	
  71

  
	
  11.04

  	
   

  	
  Benefit of Agreement.

  	
   

  	
  72

  
	
  11.05

  	
   

  	
  No Waiver; Remedies Cumulative.

  	
   

  	
  74

  
	
  11.06

  	
   

  	
  Payments Pro Rata.

  	
   

  	
  74

  
	
  11.07

  	
   

  	
  Payments Set Aside.

  	
   

  	
  75

  
	
  11.08

  	
   

  	
  Calculations; Computations.

  	
   

  	
  75

  
	
  11.09

  	
   

  	
  GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE.

  	
   

  	
  75

  
	
  11.10

  	
   

  	
  Counterparts.

  	
   

  	
  76

  
	
  11.11

  	
   

  	
  Effectiveness.

  	
   

  	
  76

  
	
  11.12

  	
   

  	
  Headings Descriptive.

  	
   

  	
  76

  
	
  11.13

  	
   

  	
  Amendment or Waiver.

  	
   

  	
  76

  
	
  11.14

  	
   

  	
  Survival.

  	
   

  	
  78

  
	
  11.15

  	
   

  	
  Domicile of Loans.

  	
   

  	
  78

  
	
  11.16

  	
   

  	
  Interest Rate Limitations.

  	
   

  	
  78

  
	
  11.17

  	
   

  	
  Confidentiality.

  	
   

  	
  78

  
	
  11.18

  	
   

  	
  WAIVER OF JURY TRIAL.

  	
   

  	
  79

  
	
  11.19

  	
   

  	
  Severability.

  	
   

  	
  79

  
	
  11.20

  	
   

  	
  USA Patriot Act Notice.

  	
   

  	
  79

  
	
  11.21

  	
   

  	
  Entire Agreement.

  	
   

  	
  79

  

 

 iii
 

 

SCHEDULES AND EXHIBITS

	
  Schedule 1

  	
   

  	
  –

  	
   

  	
  List of Banks and Commitments

  
	
  Schedule 2

  	
   

  	
  –

  	
   

  	
  Bank Addresses

  
	
  Schedule 5.04

  	
   

  	
  –

  	
   

  	
  Existing Litigation

  
	
  Schedule 5.13

  	
   

  	
  –

  	
   

  	
  Past Due Tax Returns and Payments

  
	
  Schedule 5.14

  	
   

  	
  –

  	
   

  	
  Pension Plans and Post-Retirement Health Care
  Obligations

  
	
  Schedule 5.15

  	
   

  	
  –

  	
   

  	
  Subsidiaries

  
	
  Schedule 5.18

  	
   

  	
  –

  	
   

  	
  Collective Bargaining Agreements

  
	
  Schedule 5.20

  	
   

  	
  –

  	
   

  	
  Existing Indebtedness

  
	
  Schedule
  7.06

  	
   

  	
  –

  	
   

  	
  Existing Investment Commitments

  

 

 

	
  Exhibit A

  	
   

  	
  –

  	
   

  	
  Form of Notice of Borrowing

  
	
  Exhibit B

  	
   

  	
  –

  	
   

  	
  Form of Revolving Note

  
	
  Exhibit C

  	
   

  	
  –

  	
   

  	
  Intentionally Omitted

  
	
  Exhibit D

  	
   

  	
  –

  	
   

  	
  Form of Officer’s Certificate

  
	
  Exhibit E

  	
   

  	
  –

  	
   

  	
  Form of Section 3.05(e)(ii) Certificate

  
	
  Exhibit F

  	
   

  	
  –

  	
   

  	
  Form of Subsidiary Guaranty

  
	
  Exhibit G

  	
   

  	
  –

  	
   

  	
  Form of Compliance Certificate

  
	
  Exhibit H

  	
   

  	
  –

  	
   

  	
  Form of Assignment and Assumption Agreement

  

 

 iv

CREDIT AGREEMENT, dated as of January 18, 2007, among UNIVERSAL AMERICAN
FINANCIAL CORP., a New York corporation (the “Borrower”), the lending
institutions listed from time to time on Schedule 1 hereto (each a “Bank” and,
collectively, the “Banks”), and BANK OF AMERICA, N.A., as Administrative Agent
(the “Administrative Agent”) and L/C Issuer (defined herein). Unless otherwise
defined herein, all capitalized terms used herein and defined in Section 9
are used herein as so defined.

RECITALS:

The Borrower has requested that the Banks provide a revolving credit
facility in an amount up to $50,000,000 to the Borrower, and the Banks are
willing to provide such revolving credit facility upon the terms and conditions
set forth herein.

In consideration of the foregoing and the mutual covenants contained
herein, the Borrower, the Administrative Agent and the Banks agree as follows:

SECTION 1.           Amount and Terms of
Credit.

1.01         Commitments.  Subject to and upon the terms and conditions
herein set forth, each Bank severally agrees to make a loan or loans (each a “Loan”
and, collectively, the “Loans”) to the Borrower, which Loans shall be drawn
under the Revolving Loan Facility as set forth below:

(a)           Each Loan under the Revolving Loan Facility (each, a “Revolving Loan”
and, collectively, the “Revolving Loans”):

(i)            may be incurred by the Borrower at any time
and from time to time on and after the Initial Borrowing Date but prior to the
Revolving Loan Maturity Date;

(ii)           shall be denominated in Dollars;

(iii)          may, except as hereinafter provided, at the option of the Borrower, be
incurred and maintained as, and/or converted into, Base Rate Loans or
Eurodollar Loans, provided that all Revolving Loans incurred as part of the
same Borrowing shall, unless otherwise specifically provided herein, consist of
Revolving Loans of the same Type;

(iv)          may be repaid and reborrowed in accordance with the provisions hereof;
and

(v)           shall not exceed, for any Bank, a principal amount which, when added to
the Outstanding Amount of all other Revolving Loans made by such Bank plus
such Bank’s pro rata share of the Outstanding Amount of all L/C Obligations, equals the Revolving Loan Commitment of such
Bank.

(b)           [Intentionally Omitted].

1.02         Minimum Amount of Each
Borrowing; Maximum Number of Borrowings. 
The aggregate principal amount of each Borrowing hereunder shall not be
less than $1,000,000 and, if in excess thereof, shall be in an integral
multiple of $500,000; provided, however, that a Borrowing of Revolving Loans
constituting Base Rate Loans may be equal to the Total Unutilized Revolving
Loan Commitment. More than one Borrowing may be incurred on any day; provided
that at no time shall there be outstanding more than five Borrowings of
Revolving Loans that are Eurodollar Loans.

 1
 

1.03         Notice of Borrowing.

(a)           Whenever the Borrower desires to incur Loans under the Facility, it
shall give the Administrative Agent at its Notice Office, prior to 12:00 Noon
(New York time), at least three Business Days’ prior written notice (or
telephonic notice promptly confirmed in writing) of each Borrowing of
Eurodollar Loans and at least one Business Day’s prior written notice (or
telephonic notice promptly confirmed in writing) of each Borrowing of Base Rate
Loans to be incurred hereunder. Each such notice (each, a “Notice of Borrowing”)
shall, except as expressly provided in Section 1.11, be irrevocable, and,
in the case of each written notice and each written confirmation of telephonic
notice, shall be substantially in the form of Exhibit A hereto,
appropriately completed to specify (i) the aggregate principal amount of the
Loans to be made pursuant to such Borrowing, (ii) the date of such Borrowing
(which shall be a Business Day) and (iii) whether such Borrowing shall consist
of Base Rate Loans or Eurodollar Loans and, if Eurodollar Loans, the Interest
Period to be initially applicable thereto. The Administrative Agent shall
promptly give each Bank written notice (or telephonic notice promptly confirmed
in writing) of each proposed Borrowing, of such Bank’s proportionate share
thereof and of the other matters covered by the relevant Notice of Borrowing.

(b)           Without in any way limiting the obligation of the Borrower to confirm in
writing any notice it may give hereunder by telephone, the Administrative Agent
may act prior to receipt of written confirmation without liability upon the
basis of such telephonic notice, believed by the Administrative Agent in good
faith to be from an Authorized Officer of the Borrower.

1.04         Disbursement of Funds.

(a)           Subject to the terms and conditions herein set forth, no later than
11:00 A.M. (New York time) on the date specified in each Notice of Borrowing,
each Bank will make available its pro rata share of each Borrowing requested to
be made on such date in the manner provided below. All amounts shall be made
available to the Administrative Agent in immediately available funds,
denominated in Dollars, at the Payment Office and the Administrative Agent will
promptly make available to the Borrower by depositing to the Borrower’s account
at the Payment Office or such other account as the Borrower may designate, the
amounts so made available in immediately available funds, denominated in
Dollars. Unless the Administrative Agent shall have been notified by any Bank
prior to the date of Borrowing that such Bank does not intend to make available
to the Administrative Agent its portion of the Borrowing or Borrowings to be
made on such date, the Administrative Agent may assume that such Bank has made
such amount available to the Administrative Agent on such date of Borrowing,
and the Administrative Agent, in reliance upon such assumption, may (in its
sole discretion and without any obligation to do so) make available to the
Borrower a corresponding amount. If such corresponding amount is not in fact
made available to the Administrative Agent by such Bank and the Administrative
Agent has made available same to the Borrower, the Administrative Agent shall
be entitled to recover such corresponding amount from such Bank. If such Bank
does not pay such corresponding amount forthwith upon the Administrative Agent’s
demand therefor, the Administrative Agent shall promptly notify the Borrower,
and the Borrower shall within two Business Days pay such corresponding amount
to the Administrative Agent. The Administrative Agent shall also be entitled to
recover from the Bank or the Borrower, as the case may be, interest on such
corresponding amount in respect of each day from the date such corresponding
amount was made available by the Administrative Agent to the Borrower to the
date such corresponding amount is recovered by the Administrative Agent, at a
rate per annum equal to (x) if paid by such Bank, the

 2
 

overnight Federal Funds Rate or (y) if paid by
the Borrower, the then applicable rate of interest, calculated in accordance
with Section 1.09, for the respective Loans.

(b)           Nothing in this Section 1.04 shall, or shall be deemed to, relieve
any Bank from its obligation to fulfill its commitments and to fully perform
its obligations hereunder or to prejudice any rights which the Borrower may
have against any Bank as a result of any default by such Bank hereunder.

1.05         Notes.

(a)           The Credit Extensions made by each Bank shall be evidenced by one or more
accounts or records maintained by such Bank and by the Administrative Agent in
the ordinary course of business.  The
accounts or records maintained by the Administrative Agent (including, without
limitation, the Register) and each Bank shall be conclusive absent manifest
error of the amount of the Credit Extensions made by the Banks to the Borrower
and the interest and payments thereon. 
Any failure to so record or any error in doing so shall not, however,
limit or otherwise affect the obligation of the Borrower hereunder to pay any
amount owing with respect to the Obligations. 
In the event of any conflict between the accounts and records maintained
by any Bank and the accounts and records of the Administrative Agent in respect
of such matters, the accounts and records of the Administrative Agent shall
control in the absence of manifest error. 
Upon the request of any Bank made through the Administrative Agent, the
Borrower shall execute and deliver to such Bank (through the Administrative
Agent) a Revolving Note, which shall evidence such Bank’s Loans in addition to such
accounts or records.  Each Bank may
attach schedules to its Note(s) and endorse thereon the date, Type (if
applicable), amount and maturity of its Loans and payments with respect
thereto.

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

1.06         Conversions.  The Borrower shall have the option to convert
on any Business Day, all or a portion at least equal to $1,000,000 (and, if in
excess thereof, an integral multiple of $500,000) of the Outstanding Amount of
the Loans of one Type pursuant to the Facility into a Borrowing or Borrowings
of the other Type of Loan under the Facility; provided that (i) no partial
conversion of a Borrowing of Eurodollar Loans shall reduce the outstanding
principal amount of the Eurodollar Loans pursuant to such Borrowing to less
than $1,000,000, (ii) Base Rate Loans may only be converted into Eurodollar
Loans if no Event of Default has occurred and is continuing on the date of such
conversion, (iii) Borrowings of Eurodollar Loans resulting from this
Section 1.06 shall be limited in number as provided in Section 1.02
and (iv) each such conversion shall be made pro rata among the Loans of each
Bank of the Type being converted. Each such conversion shall be effected by the
Borrower by giving the Administrative Agent at its Notice Office, prior to 12:00
Noon (New York time), at least three Business Days’ (or one Business Day’s in
the case of a conversion into Base Rate Loans) prior written notice (or
telephonic notice promptly confirmed in writing) (each a “Notice of Conversion”)
specifying the Loans to be so converted, the Type of Loans to be converted into
and, if such Loans are to be converted into a Borrowing of Eurodollar Loans,
the Interest Period to be initially applicable thereto. The Administrative
Agent shall give each Bank prompt notice of any such proposed conversion
affecting any of its Loans.

 3
 

1.07         Letters of Credit.

(a)           The
Letter of Credit Commitment.

(i)            Subject to the terms
and conditions set forth herein, (A) the L/C Issuer agrees, in reliance upon
the agreements of the other Banks set forth in this Section 1.07 (1) from
time to time on any Business Day during the period from the Initial Borrowing
Date until the Letter of Credit Expiration Date, to issue Letters of Credit
denominated in Dollars for the account of the Borrower (provided that any of
the Borrower’s Subsidiaries may be named as the account party in any Letter of
Credit), and to amend or renew Letters of Credit previously issued by it, in
each case in accordance with clause (b) below, and (2) to honor drafts under
the Letters of Credit; and (B) the Banks severally agree to participate in
Letters of Credit issued for the account of the Borrower; provided that the L/C
Issuer shall not be obligated to make any L/C Credit Extension with respect to
any Letter of Credit, and no Bank shall be obligated to participate in any
Letter of Credit if as of the date of such L/C Credit Extension, (x) the
aggregate Outstanding Amount of all L/C Obligations would exceed the Letter of
Credit Sublimit, (y) the aggregate Outstanding Amount of all Revolving Loans
and L/C Obligations would exceed the Total Revolving Loan Commitment or (z) the
Outstanding Amount of all Revolving Loans of such Bank, plus such Bank’s pro
rata share of the Outstanding Amount of all L/C Obligations, would exceed such
Bank’s Revolving Loan Commitment.  Within
the foregoing limits, and subject to the terms and conditions hereof, the
Borrower’s ability to obtain Letters of Credit shall be fully revolving, and
accordingly the Borrower may, during the foregoing period, obtain Letters of
Credit to replace Letters of Credit that have expired or that have been drawn
upon and reimbursed.

(ii)           The L/C Issuer shall be
under no obligation to issue any Letter of Credit if:

(A)          any
order, judgment or decree of any Governmental Authority or arbitrator shall by
its terms purport to enjoin or restrain the L/C Issuer from issuing such Letter
of Credit, or any Legal Requirements applicable to the L/C Issuer or any
request or directive (whether or not having the force of law, but if not having
the force of law, one which applies generally to a class or category of
financial institutions of which the L/C Issuer is part and compliance with
which is in accordance with the general practice of those institutions) from
any Governmental Authority with jurisdiction over the L/C Issuer shall
prohibit, or request that the L/C Issuer refrain from, the issuance of letters
of credit generally or such Letter of Credit in particular or shall impose upon
the L/C Issuer with respect to such Letter of Credit any restriction, reserve
or capital requirement (for which the L/C Issuer is not otherwise compensated
hereunder) not in effect on the Effective Date, or shall impose upon the L/C
Issuer any unreimbursed loss, cost or expense which was not applicable on the
Effective Date and which the L/C Issuer in good faith deems material to it;

(B)           the expiry date of such
requested Letter of Credit would occur after the Letter of Credit Expiration
Date, unless all the Banks have approved such expiry date;

(C)           the
issuance of such Letter of Credit would violate one or more policies of the L/C
Issuer; or

 4
 

(D)          such
Letter of Credit is in an initial amount less than $500,000.

(iii)          The L/C Issuer shall be under no obligation
to amend any Letter of Credit if (A) the L/C Issuer would have no obligation at
such time to issue such Letter of Credit in its amended form under the terms
hereof, or (B) the beneficiary of such Letter of Credit does not accept the
proposed amendment to such Letter of Credit.

(b)           Procedures
for Issuance and Amendment of Letters of Credit.

(i)            Each Letter of Credit
shall be issued or amended, as the case may be, upon the request of the
Borrower delivered to the L/C Issuer (with a copy to the Administrative Agent)
in the form of a Letter of Credit Application, appropriately completed and
signed by an Authorized Officer of the Borrower.  Such Letter of Credit Application must be
received by the L/C Issuer and the Administrative Agent not later than 11:00
a.m. at least two Business Days (or such later date and time as the L/C Issuer
may agree in a particular instance in its sole discretion) prior to the
proposed issuance date or date of amendment, as the case may be.  In the case of a request for an initial
issuance of a Letter of Credit, such Letter of Credit Application shall specify
in detail reasonably satisfactory to the L/C Issuer: (A) the proposed issuance
date of the requested Letter of Credit (which shall be a Business Day); (B) the
amount thereof; (C) the expiry date thereof; (D) the name and address of the beneficiary
thereof; (E) the documents to be presented by such beneficiary in case of any
drawing thereunder; (F) the full text of any certificate to be presented by
such beneficiary in case of any drawing thereunder; and (G) such other matters
as the L/C Issuer may reasonably require. 
In the case of a request for an amendment of any outstanding Letter of
Credit, such Letter of Credit Application shall specify in detail reasonably
satisfactory to the L/C Issuer (A) the Letter of Credit to be amended; (B) the
proposed date of amendment thereof (which shall be a Business Day); (C) the
nature of the proposed amendment; and (D) such other matters as the L/C Issuer
may reasonably require.

(ii)           Promptly
after receipt of any Letter of Credit Application, the L/C Issuer will confirm
with the Administrative Agent (by telephone or in writing) that the
Administrative Agent has received a copy of such Letter of Credit Application
from the Borrower and, if not, the L/C Issuer will provide the Administrative
Agent with a copy thereof.  Upon receipt
by the L/C Issuer of confirmation from the Administrative Agent that the
requested issuance or amendment is permitted in accordance with the terms
hereof, then, subject to the terms and conditions hereof, the L/C Issuer shall,
on the requested date, issue a Letter of Credit for the account of the Borrower
or enter into the applicable amendment, as the case may be, in each case in
accordance with the L/C Issuer’s usual and customary business practices.  Immediately upon the issuance of each Letter
of Credit, each Bank shall be deemed to, and hereby irrevocably and
unconditionally agrees to, purchase from the L/C Issuer a risk participation in
such Letter of Credit in an amount equal to the product of such Bank’s pro rata
share of the Total Revolving Loan Commitment times the amount of such Letter of
Credit.

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

 5
 

(c)           Drawings
and Reimbursements; Funding of Participations.

(i)            Upon receipt from the
beneficiary of any Letter of Credit of any notice of a drawing under such
Letter of Credit, the L/C Issuer shall promptly notify the Borrower and the
Administrative Agent thereof.  Following
receipt of such notice by the L/C Issuer, the Borrower shall, not later than
11:00 a.m. on the date of any payment by the L/C Issuer under a Letter of
Credit (each such date, an “Honor Date”), reimburse the L/C Issuer through the
Administrative Agent in an amount equal to the amount of such drawing.  If the Borrower fails to so reimburse the L/C
Issuer by such time, the Administrative Agent shall promptly notify each Bank
of the Honor Date, the amount of the unreimbursed drawing (the “Unreimbursed
Amount”), and the amount of such Bank’s pro rata share thereof.  In such event, the Borrower shall be deemed
to have requested a Borrowing of Base Rate Loans to be disbursed on the Honor
Date in an amount equal to the Unreimbursed Amount, without regard to the
minimum and multiples specified in Section 1.02 for the principal amount
of Base Rate Loans, but subject to the amount of the Total Unutilized Revolving
Loan Commitment and the applicable conditions set forth in Section 4
(other than the delivery of a Notice of Borrowing).  Any notice given by the L/C Issuer or the Administrative
Agent pursuant to this Section 1.07(c)(i) may be given by telephone if
immediately confirmed in writing; provided that the lack of such an immediate
confirmation shall not affect the conclusiveness or binding effect of such
notice.

(ii)           Each Bank (including
the Bank acting as L/C Issuer) shall upon any notice pursuant to
Section 1.07(c)(i) make funds available to the Administrative Agent for
the account of the L/C Issuer at the Administrative Agent’s Office in an amount
equal to its pro rata share of the Unreimbursed Amount not later than 1:00 p.m.
on the Business Day specified in such notice by the Administrative Agent,
whereupon, subject to the provisions of Section 1.07(c)(iii), each Bank
that so makes funds available shall be deemed to have made a Base Rate Loan to
the Borrower in such amount.  The
Administrative Agent shall remit the funds so received to the L/C Issuer.

(iii)          With respect to any
Unreimbursed Amount that is not fully refinanced by a Borrowing of Base Rate
Loans because the applicable conditions set forth in Section 4 cannot be
satisfied or for any other reason, the Borrower shall be deemed to have
incurred from the L/C Issuer an L/C Borrowing in the amount of the Unreimbursed
Amount that is not so refinanced, which L/C Borrowing shall be due and payable
on demand (together with interest) and shall bear interest at a rate per annum
equal to the Base Rate in effect from time to time plus the sum of (i) 2% and
(ii) the Applicable Percentage then in effect for Base Rate Loans under the
Revolving Credit Facility.  In such event,
each Bank’s payment to the Administrative Agent for the account of the L/C
Issuer pursuant to Section 1.07(c)(ii) shall be deemed payment in respect
of its participation in such L/C Borrowing and shall constitute an L/C Advance
from such Bank in satisfaction of its participation obligation under this
Section 1.07.

(iv)          Until each Bank funds
its Revolving Loan or L/C Advance pursuant to this Section 1.07(c) to
reimburse the L/C Issuer for any amount drawn under any Letter of Credit,
interest in respect of such Bank’s pro rata share of such amount shall be
solely for the account of the L/C Issuer.

(v)           Each Bank’s obligation
to make Revolving Loans or L/C Advances to reimburse the L/C Issuer for amounts
drawn under Letters of Credit, as contemplated by

 6
 

this Section 1.07(c), shall be absolute and
unconditional and shall not be affected by any circumstance, including (A) any
set-off, counterclaim, recoupment, defense or other right which such Bank may
have against the L/C Issuer, the Borrower or any other Person for any reason
whatsoever; (B) the occurrence or continuance of a Default or Event of Default,
or (C) any other occurrence, event or condition, whether or not similar to any
of the foregoing; provided, however, that each Bank’s obligation to make Revolving
Loans pursuant to this Section 1.07(c) is subject to the applicable
conditions set forth in Section 4 (other than delivery by the Borrower of
a Notice of Borrowing).  No such making
of an L/C Advance shall relieve or otherwise impair the obligation of the
Borrower to reimburse the L/C Issuer for the amount of any payment made by the
L/C Issuer under any Letter of Credit, together with interest as provided
herein.

(vi)          If any Bank fails to
make available to the Administrative Agent for the account of the L/C Issuer
any amount required to be paid by such Bank pursuant to the foregoing
provisions of this Section 1.07(c) by the time specified in
Section 1.07(c)(ii), the L/C Issuer (acting through the Administrative
Agent) shall be entitled to recover from such Bank, on demand, such amount with
interest thereon for the period from the date such payment is required to the
date on which such payment is immediately available to the L/C Issuer at a rate
per annum equal to the Federal Funds Rate from time to time in effect.  A certificate of the L/C Issuer submitted to
any Bank (through the Administrative Agent) with respect to any amounts owing
under this clause (vi) shall be conclusive absent manifest error.

(d)           Repayment
of Participations.

(i)            At any time after the
L/C Issuer has made a payment under any Letter of Credit and has received from
any Bank such Bank’s L/C Advance in respect of such payment in accordance with
Section 1.07(c), if the Administrative Agent receives for the account of
the L/C Issuer any payment in respect of the related Unreimbursed Amount or
interest thereon (whether directly from the Borrower or otherwise, including
proceeds of Cash Collateral applied thereto by the Administrative Agent), the
Administrative Agent will distribute to such Bank its pro rata share thereof
(appropriately adjusted, in the case of interest payments, to reflect the
period of time during which such Bank’s L/C Advance was outstanding) in the
same funds as those received by the Administrative Agent.

(ii)           If
any payment received by the Administrative Agent for the account of the L/C
Issuer pursuant to Section 1.07(c)(i) is required to be returned under any
of the circumstances described in Section 11.07 (including pursuant to any
settlement entered into by the L/C Issuer in its discretion), each Bank shall
pay to the Administrative Agent for the account of the L/C Issuer its pro rata
share thereof on demand of the Administrative Agent, plus interest thereon from
the date of such demand to the date such amount is returned by such Bank, at a
rate per annum equal to the Federal Funds Rate from time to time in effect.

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

(i)            any lack of validity
or enforceability of such Letter of Credit, this Agreement, or any other
agreement or instrument relating thereto;

 7
 

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

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

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

(v)           any
other circumstance or happening whatsoever, whether or not similar to any of
the foregoing, including any other circumstance that might otherwise constitute
a defense available to, or a discharge of, the Borrower.

The Borrower shall promptly examine a copy of each Letter of Credit and
each amendment thereto that is delivered to it and, in the event of any claim
of noncompliance with the Borrower’s instructions or other irregularity, the
Borrower will, within two Business Days, notify the L/C Issuer.

(f)            Role
of L/C Issuer.  Each
Bank and the Borrower agree that, in paying any drawing under a Letter of
Credit, the L/C Issuer shall not have any responsibility to obtain any document
(other than any sight draft, certificate or document expressly required by the
Letter of Credit) or to ascertain or inquire as to the validity or accuracy of
any such document or the authority of the Person executing or delivering any
such document.  None of the L/C Issuer,
any Agent-Related Person or any of the respective correspondents, participants
or assignees of the L/C Issuer shall be liable to any Bank for (i) any action
taken or omitted in connection herewith at the request or with the approval of
the Banks or the Required Banks, as applicable; (ii) any action taken or
omitted in the absence of gross negligence or willful misconduct; or (iii) the
due execution, effectiveness, validity or enforceability of any document or
instrument related to any Letter of Credit or Letter of Credit
Application.  The Borrower hereby assumes
all risks of the acts or omissions of any beneficiary or transferee with
respect to its use of any Letter of Credit; provided, however, that this
assumption is not intended to, and shall not, preclude the Borrower’s pursuing
such rights and remedies as it may have against the beneficiary or transferee
at law or under any other agreement. 
None of the L/C Issuer, any Agent-Related Person, or any of the
respective correspondents, participants or assignees of the L/C Issuer, shall
be liable or responsible for any of the matters described in clauses (i)
through (v) of Section 1.07(e); provided, however, that anything in such
clauses to the contrary notwithstanding, the Borrower may have a claim against
the L/C Issuer, and the L/C Issuer may be liable to the Borrower, to the
extent, but only to the extent, of any direct, as opposed to consequential or
exemplary, damages

 8
 

suffered by the Borrower which the Borrower proves were caused by the
L/C Issuer’s willful misconduct or gross negligence or the L/C Issuer’s willful
failure to pay under any Letter of Credit after the presentation to it by the
beneficiary of a sight draft and document(s) strictly complying with the terms
and conditions of a Letter of Credit. In furtherance and not in limitation of the
foregoing, the L/C Issuer may accept documents that appear on their face to be
in order, without responsibility for further investigation, regardless of any
notice or information to the contrary, and the L/C Issuer shall not be
responsible for the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign a Letter of Credit or the rights
or benefits thereunder or proceeds thereof, in whole or in part, which may
prove to be invalid or ineffective for any reason.

(g)           Cash
Collateral.  Upon the request of the
Administrative Agent, (i) if the L/C Issuer has honored any full or partial
drawing request under any Letter of Credit and such drawing has resulted in an
L/C Borrowing, or (ii) if, as of the Letter of Credit Expiration Date, any
Letter of Credit may for any reason remain outstanding and partially or wholly
undrawn, the Borrower shall immediately Cash Collateralize the then Outstanding
Amount of all L/C Obligations (in an amount equal to such Outstanding Amount
determined as of the date of such L/C Borrowing or the Letter of Credit
Expiration Date, as the case may be). 
The Borrower hereby grants to the Administrative Agent, for the benefit
of the L/C Issuer and the Banks, a security interest in all such Cash Collateral
and all proceeds of the foregoing.

(h)           Applicability
of ISP98.  Unless
otherwise expressly agreed by the L/C Issuer and the Borrower when a Letter of
Credit is issued, the rules of the “International Standby Practices 1998”
published by the Institute of International Banking Law & Practice (or such
later version thereof as may be in effect at the time of issuance) shall apply
to each Letter of Credit.

(i)            Letter of
Credit Fees.  The Borrower shall pay to
the Administrative Agent for the account of each Bank in accordance with its
pro rata sharea Letter of Credit fee for each
Letter of Credit equal to the Applicable Percentage times the daily maximum
amount available to be drawn under such Letter of Credit (whether or not such
maximum amount is then in effect under such Letter of Credit). Such letter of
credit fee shall be computed on a quarterly basis in arrears. Such letter of
credit fee shall be due and payable on the last Business Day of each calendar quarter, commencing with the
first such date to occur after the issuance of such Letter of Credit, on the
Letter of Credit Expiration Date and thereafter on demand.  If there is any change in the Applicable
Percentage during any quarter, the daily maximum amount of each Letter of
Credit shall be computed and multiplied by the Applicable Percentage separately
for each period during such quarter that such Applicable Percentage was in
effect.

(j)            Fronting
Fee and Documentary and Processing Charges Payable to L/C Issuer.The Borrower shall pay directly to the L/C Issuer for its
own account a fronting fee with respect to each Letter of Credit in the amounts
and at the times specified in the Fee Letter. In addition, the Borrower shall
pay directly to the L/C Issuer for its own account the customary issuance,
presentation, amendment and other processing fees, and other standard costs and
charges, of the L/C Issuer relating to letters of credit as from time to time
in effect.  Such customary fees and
standard costs and charges are due and payable within two Business Days
following receipt by the Borrower of demand and are nonrefundable.

(k)           Conflict
with Letter of Credit Application.  In
the event of any conflict between the terms hereof and the terms of any Letter
of Credit Application, the terms hereof shall control.

 9
 

(l)            Letters
of Credit Issued for Subsidiaries. 
Notwithstanding that a Letter of Credit issued or outstanding hereunder
is for the account of a Subsidiary of the Borrower, the Borrower shall be
obligated to reimburse the L/C Issuer hereunder for any and all drawings under
such Letter of Credit.  The Borrower
hereby acknowledges that the issuance of Letters of Credit for the account of
the Borrower’s Subsidiaries inures to the benefit of the Borrower, and that the
Borrower’s business derives substantial benefits from the businesses of such
Subsidiaries.

1.08         Pro Rata Borrowings.  All Loans, L/C Advances and participations in
Letters of Credit under this Agreement shall be made by the Banks pro rata on
the basis of their Revolving Loan Commitments. The obligations of the Banks to
make Loans and L/C Advances and to fund participations in Letters of Credit are
several and not joint.  The failure of
any Bank to make any Loan or L/C Advance or to fund such participation on any
date required hereunder shall not relieve any other Bank of its corresponding
obligation to do so on such date, and no Bank shall be responsible for the
failure of any other Bank to so make its Loan or L/C Advance or to purchase its
participation.

1.09         Interest.

(a)           The unpaid principal amount of each Base Rate Loan shall bear interest
from the date of the Borrowing thereof until the earlier of (i) the maturity
(whether by acceleration or otherwise) of such Base Rate Loan and (ii) the
conversion of such Base Rate Loan to a Eurodollar Loan pursuant to
Section 1.06, at a rate per annum which shall at all times be equal to the
Applicable Percentage then in effect for Base Rate Loans plus the Base Rate in
effect from time to time.

(b)           The unpaid principal amount of each Eurodollar Loan shall bear interest
from the date of the Borrowing thereof until the earlier of (i) the maturity
(whether by acceleration or otherwise) of such Eurodollar Loan or (ii) the
conversion of such Eurodollar Loan to a Base Rate Loan pursuant to
Section 1.06, at a rate per annum which shall at all times be equal to the
Applicable Percentage then in effect for Eurodollar Loans plus the relevant
Eurodollar Rate for the Interest Period applicable to such Eurodollar Loan.

(c)           Overdue principal and, to the extent permitted by law, overdue interest
in respect of each Loan and any other overdue amount payable hereunder, and,
during the existence of an Event of Default under Section 8.01, the
Outstanding Amount of each Loan, shall bear interest at a rate per annum equal
to 2% in excess of the rate of interest otherwise then applicable thereto.

(d)           Interest shall accrue from and including the date of any Borrowing to
but excluding the date of any repayment thereof and shall be payable (i) in
respect of each Base Rate Loan, quarterly in arrears on the last Business Day
of each calendar quarter, (ii) in respect of each Eurodollar Loan, on the last
day of each Interest Period applicable thereto and, in the case of an Interest
Period of six months, on the date occurring three months after the first day of
such Interest Period, and (iii) in respect of each Loan, on any conversion or
prepayment (on the amount so converted or prepaid), at maturity (whether by
acceleration or otherwise) and, after such maturity, on demand.

(e)           All computations of interest hereunder shall be made in accordance with
Section 11.08(b) and (c).

(f)            The Administrative Agent, upon determining the
interest rate for any Borrowing of Eurodollar Loans for any Interest Period,
shall promptly notify the Borrower and the Banks thereof.

 10
 

1.10         Interest Periods.  At the time the Borrower gives a Notice of
Borrowing or Notice of Conversion in respect of the making of, or conversion
into, a Borrowing of Eurodollar Loans (in the case of the initial Interest
Period applicable thereto) or prior to 12:00 Noon (New York time) on the third
Business Day prior to the expiration of an Interest Period applicable to a
Borrowing of Eurodollar Loans, it shall have the right to elect by giving the
Administrative Agent written notice (or telephonic notice promptly confirmed in
writing) of the Interest Period to be applicable to such Borrowing, which
Interest Period shall, at the option of the Borrower, be a one, two, three or
six month period. Notwithstanding anything to the contrary contained above:

(i)            the initial Interest Period for any Borrowing
of Eurodollar Loans shall commence on the date of such Borrowing (including the
date of any conversion from a Borrowing of Base Rate Loans) and each Interest
Period occurring thereafter in respect of such Borrowing shall commence on the
day on which the next preceding Interest Period expires;

(ii)           if any Interest Period begins on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period,
such Interest Period shall end on the last Business Day of such calendar month;

(iii)          if any Interest Period would otherwise expire on a day which is not a
Business Day, such Interest Period shall expire on the next succeeding Business
Day, provided that if any Interest Period would otherwise expire on a day which
is not a Business Day but is a day of the month after which no further Business
Day occurs in such month, such Interest Period shall expire on the next
preceding Business Day;

(iv)          no Interest Period for a Borrowing under the Facility may be elected if
it would extend beyond the Maturity Date for the Facility; and

(v)           no Interest Period may be elected at any time when an Event of Default
has occurred and is continuing.

If upon the expiration of
any Interest Period, the Borrower has failed, or is not permitted, to elect a
new Interest Period to be applicable to the respective Borrowing of Eurodollar
Loans as provided above, the Borrower shall be deemed to have elected to
convert such Borrowing into a Borrowing of Base Rate Loans effective as of the expiration
date of such current Interest Period.

1.11         Increased Costs, Illegality, etc.

(a)           In the event that (x) in the case of clause (i) below, the
Administrative Agent or (y) in the case of clauses (ii) and (iii) below, any
Bank shall have determined, in each case acting in good faith (which
determination shall, absent manifest error, be final and conclusive and binding
upon all parties hereto):

(i)            on any date for determining the Eurodollar
Rate for any Interest Period, that, by reason of any changes arising after the
Effective Date affecting the London interbank market for Dollar deposits
generally, adequate and fair means do not exist for ascertaining the applicable
interest rate on the basis provided for in the definition of Eurodollar Rate;
or

 11
 

(ii)           at any time, that such Bank shall incur increased costs or reductions in
the amounts received or receivable hereunder with respect to any Eurodollar
Loans (excluding any Taxes, Other Taxes and amounts relating thereto, payment
with respect to which shall be governed solely and exclusively by
Section 3.05) because of any change since the Effective Date in any
applicable law, governmental rule, regulation, guideline, order or request
(whether or not having the force of law, but if not having the force of law,
one which applies generally to a class or category of financial institutions of
which such Bank is part and compliance with which is in accordance with the
general practice of those institutions), or in the interpretation or
administration thereof and including the introduction of any new law or
governmental rule, regulation, guideline, order or request (such as, for
example, but not limited to, a change in official reserve requirements, but, in
all events, excluding reserves required under Regulation D to the extent
included in the computation of the Eurodollar Rate); or

(iii)          at any time, that the making or continuance of any Eurodollar Loan has
become unlawful due to the compliance by such Bank in good faith with any
change since the Effective Date in any law, governmental rule, regulation,
guideline or order, or the interpretation or application thereof, or would
conflict with any thereof not having the force of law, but if not having the
force of law, one which applies generally to a class or category of financial
institutions of which such Bank is part and compliance with which is in
accordance with the general practice of those institutions;

then, and in any such
event, such Bank (or the Administrative Agent in the case of clause (i)
above) shall (x) on such date and (y) within 10 Business Days of the date on
which such event no longer exists give notice (by telephone confirmed in
writing) to the Borrower and to the Administrative Agent of such determination
(which notice the Administrative Agent shall promptly transmit to each of the
other Banks). Thereafter (x) in the case of clause (i) above, Eurodollar
Loans shall no longer be available until such time as the Administrative Agent
notifies the Borrower and the Banks that the circumstances giving rise to such
notice by the Administrative Agent no longer exist, and any Notice of
Borrowing, Notice of Conversion or notice of a new Interest Period pursuant to
Section 1.10 given by the Borrower with respect to Eurodollar Loans which
has not yet occurred shall be deemed rescinded by the Borrower or, in the case
of a Notice of Borrowing, shall, at the option of the Borrower, be deemed
converted into a Notice of Borrowing for Base Rate Loans to be made on the date
of Borrowing contained in such Notice of Borrowing or, in the case of the
selection of a new Interest Period for Eurodollar Loans pursuant to
Section 1.10, shall be deemed to be a Notice of Conversion of such
Borrowing to a Borrowing of Base Rate Loans, (y) in the case of
clause (ii) above, the Borrower shall pay to such Bank, within 10 days of
its receipt of written demand therefor (which shall include sufficient detail
to demonstrate the basis for the calculation thereof, which basis shall be
reasonable and consistently applied, submitted to the Borrower by such Bank and
shall, absent manifest error, be conclusive evidence of the increased costs or
reduction in the amount received or receivable by such Bank hereunder with
respect to Eurodollar Loans), such additional amounts as shall be required to compensate
such Bank for such increased costs or reductions in amounts receivable
hereunder and (z) in the case of clause (iii) above, the Borrower shall
take one of the actions specified in Section 1.11(b) as promptly as
reasonably practicable and, in any event, within the time period required by
applicable law.

(b)           At any time that any Eurodollar Loan is affected by the circumstances
described in Section 1.11(a)(ii) or (iii), the Borrower may (and in the
case of a Eurodollar Loan affected pursuant to Section 1.11(a)(iii) the
Borrower shall) either (i) if the affected Eurodollar Loan is then being made
pursuant to a Borrowing, by giving the Administrative Agent telephonic notice
(confirmed promptly in writing) thereof on the same date that the Borrower was
notified by a Bank pursuant to Section 1.11(a)(ii) or (iii), cancel said
Borrowing, convert the related Notice of

 12
 

Borrowing into one requesting a Borrowing of
Base Rate Loans or require the affected Bank to make its requested Loan as a
Base Rate Loan, or (ii) if the affected Eurodollar Loan is then outstanding,
upon at least one Business Day’s notice to the Administrative Agent, require
the affected Bank to convert each such affected Eurodollar Loan into a Base
Rate Loan, provided that if more than one Bank is affected at any time, then
all affected Banks must be treated in the same manner pursuant to this
Section 1.11(b).

(c)           If, any Bank shall have determined that, after the Effective Date, the
adoption or effectiveness of any applicable law, rule or regulation regarding
capital adequacy, or any change therein, or any change in the interpretation or
administration thereof by any Governmental Authority, central bank or
comparable agency charged by law with the interpretation or administration
thereof, or compliance by such Bank or its parent corporation with any request
or directive regarding capital adequacy (whether or not having the force of
law, but if not having the force of law, one which applies generally to a class
or category of financial institutions of which such Bank is part and compliance
with which is in accordance with the general practice of those institutions) of
any such Governmental Authority, central bank or comparable agency, in each
case made subsequent to the Effective Date, has or would have the effect of
reducing the rate of return on such Bank’s or its parent corporation’s capital
or assets as a consequence of such Bank’s commitments or obligations hereunder
to a level below that which such Bank or its parent corporation could have
achieved but for such adoption, effectiveness, change or compliance (taking
into consideration such Bank’s or its parent corporation’s policies with
respect to capital adequacy), then from time to time, the Borrower shall within
10 days of its receipt of written demand by such Bank (with a copy to the
Administrative Agent), pay to such Bank such additional amount or amounts as
will compensate such Bank or its parent corporation for such reduction. Each
Bank, upon determining in good faith that any additional amounts will be
payable pursuant to this Section 1.11(c), will give prompt written notice
thereof to the Borrower, which notice shall set forth in reasonable detail the
basis of the calculation of such additional amounts, which basis must be
reasonable and consistently applied. 
Such written notice shall be received prior to or contemporaneously with
any demand in respect thereof.

(d)           Notwithstanding anything in this Agreement to the contrary, to the
extent that any notice required by this Section 1.11 or Section 1.12
is given by any Bank more than 180 days after such Bank obtained actual
knowledge of the occurrence of the event giving rise to the additional costs of
the type described in this Section 1.11 or Section 1.12, such Bank
shall not be entitled to compensation under this Section 1.11 or
Section 1.12 for any amounts incurred or accruing more than 180 days prior
to the giving of such notice to the Borrower.

1.12         Compensation.  The Borrower shall compensate each Bank, upon
its written request (which request shall set forth in reasonable detail the
basis for requesting such compensation), for all reasonable losses, expenses
and liabilities (including, without limitation, any loss, expense or liability
incurred by reason of the liquidation or reemployment of deposits or other
funds required by such Bank to fund its Eurodollar Loans but excluding any loss
of anticipated profit with respect to such Loans) which such Bank may sustain:
(i) if for any reason (other than a default by such Bank or the Administrative
Agent) a Borrowing of Eurodollar Loans does not occur on a date specified
therefor in a Notice of Borrowing or Notice of Conversion (whether or not
withdrawn by the Borrower or deemed withdrawn pursuant to
Section 1.11(a)), or a new Interest Period for Eurodollar Loans selected
pursuant to Section 1.10 does not become effective; (ii) if any repayment,
prepayment or conversion of any of its Eurodollar Loans occurs on a date which
is not the last day of an Interest Period applicable thereto; (iii) if any prepayment
of any of its Eurodollar Loans is not made on any date specified in a notice of
prepayment given by the Borrower; or (iv) as a consequence of (x) any other
failure by the Borrower to repay its Loans when required by the terms of this
Agreement or (y) an election made pursuant to

 13

Section 1.11(b).  The amount payable to such Bank by the
Borrower under this Section 1.12 shall be an amount equal to the amount
(if any) by which (i) the additional interest which would have been payable on
the amount so received or recovered had it been received or recovered on the
last day of the applicable Interest Period exceeds (ii) the amount of interest,
which, in the reasonable opinion of such Bank, would have been payable to such
Bank on the last day of such Interest Period in respect of a Dollar deposit
equal to the amount so received or recovered placed by it with a prime bank in
London for a period starting on the date of such receipt or recovery and ending
on the last day of such Interest Period.

1.13         Change of Lending
Office.  The L/C Issuer and each Bank
agrees that, upon the occurrence of any event giving rise to the operation of
Section 1.11(a)(ii) or (iii) or Section 3.05 with respect to the L/C
Issuer or such Bank, it will, if requested by the Borrower, use reasonable
efforts (subject to overall policy considerations of the L/C Issuer or such
Bank) to designate another lending office for any Letters of Credit or Loans
affected by such event; provided that such designation is made on such terms
that, in the good faith opinion of the L/C Issuer or such Bank, the L/C Issuer
or such Bank and its lending office suffer no economic, legal or regulatory
disadvantage, with the object of avoiding the consequence of the event giving
rise to the operation of any such Section. Nothing in this Section 1.13
shall affect or postpone any of the obligations of the Borrower or the rights
of the L/C Issuer or any Bank provided in Section 1.11 or 3.05.

1.14         Replacement of
Banks.  If any Bank becomes a Defaulting
Bank or upon the occurrence of any event giving rise to the operation of
Section 1.11(a)(ii) or (iii), Section 1.11(c) or Section 3.05
with respect to any Bank which results in such Bank charging to the Borrower
increased costs in excess of those being generally charged by the other Banks,
the Borrower shall have the right, if no Event of Default has occurred and is
continuing, to replace such Bank (the “Replaced Bank”) with one or more
Eligible Assignees, none of whom shall constitute a Defaulting Bank at the time
of such replacement (collectively, the “Replacement Bank”), provided that (i)
at the time of any replacement pursuant to this Section 1.14, the
Replacement Bank shall enter into one or more Assignment and Assumption
Agreements pursuant to Section 11.04(b) (and with all fees payable
pursuant to said Section 11.04(b) to be paid by the Borrower or the
Replacement Bank) pursuant to which the Replacement Bank shall acquire all of
the Commitment, outstanding Loans and participations in L/C Obligations held by
the Replaced Bank and, in connection therewith, shall pay to the Replaced Bank
in respect thereof an amount equal to (A) the principal of, and all accrued
interest on, all outstanding Loans held by the Replaced Bank plus (B) all
accrued, but theretofore unpaid, Fees owing to the Replaced Bank pursuant to
Section 1.07(i) and Section 2.01, and (ii) all obligations
(including, without limitation, all such amounts, if any, due and owing under
Section 1.12) of the Borrower due and owing to the Replaced Bank (other
than those specifically described in clause (i) above in respect of which
the assignment purchase price has been, or is concurrently being, paid) shall
be paid in full to such Replaced Bank concurrently with such replacement. Upon
the execution of the respective Assignment and Assumption Agreement, the
payment of amounts referred to in clauses (i) and (ii) above, recordation of
the assignment on the Register by the Administrative Agent pursuant to
Section 6.12 and, if so requested by the Replacement Bank, delivery to the
Replacement Bank of the appropriate Note or Notes executed by the Borrower, (x)
the Replacement Bank shall become a Bank hereunder and the Replaced Bank shall
cease to constitute a Bank hereunder, except with respect to indemnification
provisions under this Agreement (including, without limitation,
Sections 1.11, 1.12, 3.05, 10.07 and 11.01(b)), which shall survive as to
such Replaced Bank and (y) Schedule 1 hereto shall be deemed modified to
reflect the changed Commitments (and/or outstanding Loans, as the case may be)
resulting from the assignment from the Replaced Bank to the Replacement Bank.

 14
 

SECTION 2.           Fees;
Termination of Commitments.

2.01         Fees.

(a)           The Borrower shall pay to the Administrative Agent for the account of
each Bank a commitment fee (the “Commitment Fee”) for the period from the
Effective Date to and including the date on which the Total Revolving Loan
Commitment has been terminated, computed at a rate for each day equal to the
Applicable Percentage then in effect for Commitment Fees multiplied by the
daily Unutilized Revolving Loan Commitment of each such Bank. Accrued
Commitment Fees shall be due and payable in arrears on the last Business Day of
each calendar quarter and the date upon which the Total Revolving Loan
Commitment is terminated.

(b)           The Borrower shall pay to the Administrative Agent, for its own account
when and as due, the administrative fee, if any, set forth in the Fee Letter.

(c)           All computations of Fees shall be made in accordance with
Section 11.08(b).

2.02         Termination of
Commitments.  The Total Revolving Loan
Commitment (and the Revolving Loan Commitment of each Bank) shall terminate on
the earliest of (i) the Revolving Loan Maturity Date, (ii) the date on which a
Change of Control occurs, (iii) the date on which the Other Credit Agreement is
terminated, amended and restated, replaced or refinanced, and (iv) the date on
which the Borrower ceases for any reason to be an issuer of securities required
to file reports under the Securities Exchange Act of 1934, as amended, and the
rules and regulations thereunder.

SECTION 3.           Payments.

3.01         Termination or Reduction
of the Total Revolving Loan Commitment. 
The Borrower may, upon notice to the Administrative Agent, terminate the
Total Revolving Loan Commitment, or from time to time permanently reduce the Total
Revolving Loan Commitment; provided that (i) any such notice shall be received
by the Administrative Agent not later than 11:00 A.M. (New York time) three
Business Days prior to the date of termination or reduction, (ii) any such
partial reduction shall be in an aggregate amount of $1,000,000 or any whole
multiple of $500,000 in excess thereof and (iii) the Borrower shall not
terminate or reduce the Total Revolving Loan Commitment if, after giving effect
thereto and to any concurrent prepayments hereunder, the aggregate Outstanding
Amount of all Revolving Loans and L/C Obligations would exceed the Total
Revolving Loan Commitment.  The
Administrative Agent will promptly notify the Banks of any such notice of
termination or reduction of the Total Revolving Loan Commitment.  Any reduction of the Total Revolving Loan
Commitment shall be applied to the Revolving Loan Commitment of each Bank
according to its pro rata share.  All
Commitment Fees accrued until the effective date of any termination of the
Total Revolving Loan Commitment shall be paid on the effective date of such
termination.

3.02         Voluntary
Prepayments.  The Borrower shall have the
right to prepay Loans, without premium or penalty (except for amounts payable
pursuant to Section 1.12), in whole or in part, from time to time on the
following terms and conditions: (i) the Borrower shall give the Administrative
Agent at its Notice Office written notice (or telephonic notice promptly
confirmed in writing) of its intent to prepay the Loans, the amount of such
prepayment and (in the case of Eurodollar Loans) the specific Borrowing(s)
pursuant to which such prepayment is made, which notice shall be received by
the Administrative Agent (x) in the case of Base Rate Loans, no later than
12:00 Noon (New York time) one Business Day prior to the date of such
prepayment, or (y) in the case of Eurodollar Loans, three Business Days prior
to the date of such prepayment, which notice shall promptly be transmitted by
the Administrative Agent to each of the Banks; (ii) each partial prepayment of
any Borrowing shall be in an

 15
 

aggregate principal
amount of at least $1,000,000, provided that no partial prepayment of
Eurodollar Loans made pursuant to a Borrowing shall reduce the aggregate
principal amount of the Loans outstanding pursuant to such Borrowing to an
amount less than $1,000,000; and (iii) each prepayment in respect of any Loans
made pursuant to a Borrowing shall be applied pro rata among such Loans (based
upon the then remaining principal amount of each such Scheduled Repayment), in
each case as the Borrower may direct in its sole discretion.

3.03         Mandatory Commitment Reductions.

(i)            Requirements:

(a)           [Intentionally Omitted].

(b)           [Intentionally Omitted].

(c)           [Intentionally Omitted].

(d)           On the date on which any Change of Control occurs, the Total Revolving
Loan Commitment shall terminate, the outstanding amount of all Obligations
shall be due and payable in full and the Borrower shall Cash Collateralize the
L/C Obligations (in an amount equal to the Outstanding Amount thereof).

(e)           The Outstanding Amount of all Revolving Loans shall be due and payable
in full on the Revolving Loan Maturity Date. 
In addition, if on any date the aggregate Outstanding Amount of all
Revolving Loans and L/C Obligations exceeds the Total Revolving Loan Commitment
as then in effect, the Borrower shall repay on such date the principal of the
Revolving Loans and/or Cash Collateralize the L/C Obligations in an amount
equal to such excess.

(ii)           Application:

(a)           [Intentionally Omitted].

(b)           With respect to any prepayment of Loans required by this
Section 3.03, the Borrower may designate the Types of Loans which are to
be prepaid and the specific Borrowing(s) pursuant to which made; provided that
(i) the Borrower shall first so designate all Base Rate Loans and Eurodollar
Loans with Interest Periods ending on the date of repayment prior to
designating any other Eurodollar Loans; (ii) if any prepayment of Eurodollar
Loans made pursuant to a single Borrowing shall reduce the outstanding Loans
made pursuant to such Borrowing to an amount less than $1,000,000, such
Borrowing shall be immediately converted into Base Rate Loans; and (iii) each
prepayment of any Loans made pursuant to a Borrowing shall be applied pro rata
among such Loans. In the absence of a designation by the Borrower as described
in the preceding sentence, the Administrative Agent shall, subject to the
above, make such designation in its sole discretion with a view, but no
obligation, to minimize breakage costs owing under Section 1.12.

3.04         Method and Place of
Payment.  Except as otherwise
specifically provided herein, all payments under the Credit Documents shall be
made to the Administrative Agent for the ratable account of the Banks entitled
thereto, not later than 1:00 P.M. (New York time) on the date when due and
shall be made in immediately available funds and in lawful money of the United
States of America at the Payment Office, it being understood that written,
telex or facsimile notice by the Borrower to the Administrative

 16
 

Agent to make a payment
from the funds in the Borrower’s account at the Payment Office shall constitute
the making of such payment to the extent of such funds held in such account.
Any payments under this Agreement which are made later than 1:00 P.M. (New York
time) shall be deemed to have been made on the next succeeding Business Day.
Whenever any payment to be made hereunder shall be stated to be due on a day
which is not a Business Day, the due date thereof shall be extended to the next
succeeding Business Day and, with respect to payments of principal, interest
shall be payable during such extension period at the applicable rate in effect
immediately prior to such extension.

3.05         Net Payments.

(a)           All payments made by the Borrower under the Credit Documents will be
made without condition or deduction for any counterclaim, defense, recoupment
or setoff.  In addition, except as
provided in this Section 3.05, any and all payments by the Borrower
to or for the account of the Administrative Agent, the L/C Issuer, or any Bank
under any Credit Document shall be made free and clear of and without deduction
for any and all present or future taxes, duties, levies, imposts, deductions,
assessments, fees, withholdings or similar charges, and all liabilities with
respect thereto, excluding, in the case of the Administrative Agent, the L/C
Issuer and each Bank, taxes imposed on or measured by its overall net income,
and franchise taxes imposed on it (in lieu of net income taxes), by the
jurisdiction (or any political subdivision thereof) under the laws of which the
Administrative Agent, the L/C Issuer or such Bank, as the case may be, is
organized or maintains a lending office (all such non-excluded taxes, duties,
levies, imposts, deductions, assessments, fees, withholdings or similar
charges, and liabilities being hereinafter referred to as “Taxes”).  Except as otherwise provided in clause (b)
below, if the Borrower shall be required by any laws to deduct any Taxes from
or in respect of any sum payable under any Credit Document to the
Administrative Agent, the L/C Issuer or any Bank, (i) the sum payable shall be
increased as necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Section), each of
the Administrative Agent, the L/C Issuer and such Bank receives an amount equal
to the sum it would have received had no such deductions been made, (ii) the
Borrower shall make such deductions, (iii) the Borrower shall pay the full
amount deducted to the relevant taxation authority or other authority in
accordance with applicable laws and (iv) within 30 days after the date of such
payment, the Borrower shall furnish to the Administrative Agent (which shall
forward the same to the L/C Issuer or such Bank) the original or a certified
copy of a receipt evidencing payment thereof.

(b)           In addition, the
Borrower agrees to pay any and all present or future stamp, court or
documentary taxes and any other excise or property taxes or charges or similar
levies (but specifically excluding all other United States Federal taxes, other
than withholding taxes, unless such exclusion is not required as a condition
for an exemption from reporting requirements under Sections 6011, 6111 or
6112 of the Code) which arise from any payment made under any Credit Document
or from the execution, delivery, performance, enforcement or registration of,
or otherwise with respect to, any Credit Document (hereinafter referred to as “Other
Taxes”).

(c)           If
the Borrower shall be required to deduct or pay any Taxes or Other Taxes from
or in respect of any sum payable under any Credit Document to the
Administrative Agent, the L/C Issuer or any Bank, the Borrower shall also pay
to the Administrative Agent, the L/C Issuer or such Bank, as the case may be,
at the time interest is paid, such additional amount that the Administrative
Agent, the L/C Issuer or such Bank specifies is necessary to preserve the
after-tax yield (after factoring in all taxes, including taxes imposed on or
measured by net income) that the Administrative Agent, the L/C Issuer or such
Bank would have received if such Taxes or Other Taxes had not been imposed.

 17
 

(d)           The
Borrower agrees to indemnify the Administrative Agent, the L/C Issuer and each
Bank for (i) the full amount of Taxes and Other Taxes (including any Taxes or
Other Taxes imposed or asserted by any jurisdiction on amounts payable under
this Section) paid by the Administrative Agent, the L/C Issuer and such Bank,
(ii) amounts payable under Section 3.05(c) and (iii) any liability (including
additions to tax, penalties, interest and expenses) arising therefrom or with
respect thereto, in each case whether or not such Taxes or Other Taxes were
correctly or legally imposed or asserted by the relevant Governmental
Authority.  Payment under this clause (d)
shall be made within 30 days after the date the Bank, the L/C Issuer or the
Administrative Agent, as the case may be, delivers to the Borrower a
certificate pursuant to Section 3.05(g).

(e)           The
Administrative Agent, the L/C Issuer and each Bank that is a party to this
Agreement on the Effective Date represents to the Borrower that as of the
Effective Date it is entitled to a complete exemption from United States
withholding tax with respect to payments to be made under the Credit Documents.  Upon the request of the Administrative Agent
or the Borrower, each Bank that is a “United States person” (as such term is
defined in Section 7701(a)(30) of the Code) for U.S. Federal income tax
purposes agrees to deliver to the Borrower and the Administrative Agent on or
prior to the Initial Borrowing Date, or in the case of a Bank that is an
assignee or transferee of an interest under this Agreement pursuant to
Section 11.04(b) (unless the respective Bank was already a Bank hereunder
immediately prior to such assignment or transfer), on the date of such
assignment or transfer to such Bank, two accurate and complete original signed
copies of Internal Revenue Service Form W-9. 
Upon the request of the Administrative Agent or the Borrower, each Bank
that is not a “United States person” (as such term is defined in
Section 7701(a)(30) of the Code) for U.S. Federal income tax purposes
agrees to deliver to the Borrower and the Administrative Agent on or prior to
the Initial Borrowing Date, or in the case of a Bank that is an assignee or
transferee of an interest under this Agreement pursuant to
Section 11.04(b) (unless the respective Bank was already a Bank hereunder
immediately prior to such assignment or transfer), on the date of such
assignment or transfer to such Bank, (i) two accurate and complete original
signed copies of Internal Revenue Service Form W-8BEN, W-8ECI or W-8EXP (or
successor forms) certifying to such Bank’s entitlement as of such date to a
complete exemption from United States withholding tax with respect to payments
to be made under the Credit Documents, or (ii) if the Bank is not a “bank”
within the meaning of Section 881(c)(3)(A) of the Code and cannot deliver
either Internal Revenue Service Form W-8BEN, W-8ECI or W-8EXP pursuant to
clause (i) above, (x) a certificate substantially in the form of
Exhibit E (any such certificate, a “Section 3.05(e)(ii) Certificate”)
and (y) two accurate and complete original signed copies of the appropriate
Internal Revenue Service Form certifying to such Bank’s entitlement as of such
date to a complete exemption from United States withholding tax with respect to
payments of interest to be made under the Credit Documents. In addition, each
Bank agrees that from time to time after the Effective Date, and from time to
time upon reasonable request, when a lapse in time or change in circumstances
renders the previous certification obsolete or inaccurate in any material
respect, it will deliver to the Borrower and the Administrative Agent two new
accurate and complete original signed copies of Internal Revenue Service Form
W-9, W-8BEN, W-8ECI, W-8EXP or a Section 3.05(e)(ii) Certificate, as the
case may be, and such other forms as may be required in order to confirm or
establish the entitlement of such Bank to a continued complete exemption from
United States withholding tax with respect to payments under the Credit
Documents, or it shall immediately notify the Borrower and the Administrative
Agent of its inability to deliver any such Form or Certificate, in which case such
Bank shall not be required to deliver any such Form or Certificate pursuant to
this Section 3.05(e). Notwithstanding anything to the contrary contained
in Section 3.05(a), but subject to the immediately succeeding sentence,
(x) the Borrower shall be

 18
 

entitled, to the extent it is required to do so by law, to deduct or
withhold income or similar taxes imposed by the United States (or any political
subdivision or taxing authority thereof or therein) from interest, Fees or
other amounts payable under the Credit Documents for the account of any Bank to
the extent that such Bank has not provided to the Administrative Agent or the
Borrower U.S. Internal Revenue Service Forms that establish a complete
exemption from such deduction or withholding and (y) the Borrower shall not be
obligated to pay any additional amounts and to indemnify any Bank in the manner
set forth in Sections 3.05(a) and (d) in respect of income or similar
taxes imposed by the United States if (I) such Bank has not provided to the
Borrower the Internal Revenue Service Forms required to be provided to the
Administrative Agent or the Borrower pursuant to this Section 3.05(e) or
(II) in the case of a payment, other than interest, to a Bank described in
clause (ii) above, to the extent that such Forms do not establish a
complete exemption from withholding of such taxes.  Notwithstanding anything to the contrary
contained in the preceding sentence or elsewhere in this Section 3.05
(other than Section 3.05(b)), except as set forth in Section 3.05(b),
the Borrower agrees to pay any additional amounts and to indemnify each Bank in
the manner set forth in Sections 3.05(a) and (d) (without regard to the
identity of the jurisdiction requiring the deduction or withholding) in respect
of any Taxes deducted or withheld by it as described in the immediately
preceding sentence as a result of any changes that are effective after the
Effective Date in any applicable law, treaty, governmental rule, regulation,
guideline or order, or in the interpretation thereof, relating to the deducting
or withholding of such Taxes.

(f)            If the Borrower pays any additional amount
under this Section 3.05 to the Administrative Agent, the L/C Issuer or any
Bank and such Person determines in its sole discretion, acting in good faith,
that it has actually received or realized in connection therewith any refund or
any reduction of, or credit against, its Tax liabilities in or with respect to
the taxable year in which the additional amount is paid (a “Tax Benefit”), such
Person shall pay to the Borrower an amount that such Person shall, in its sole
discretion, acting in good faith, determine is equal to the net benefit, after
tax, which was obtained by such Person in such year as a consequence of such
Tax Benefit; provided, however, that (i) such Person may determine, in its sole
discretion consistent with the policies of such Person, whether to seek a Tax
Benefit; (ii) any Taxes that are imposed on such Person as a result of a
disallowance or reduction (including through the expiration of any tax credit
carryover or carryback of such Person that otherwise would not have expired) of
any Tax Benefit with respect to which such Person has made a payment to the
Borrower pursuant to this Section 3.05(f) shall be treated as a Tax for
which the Borrower is obligated to indemnify such Person pursuant to this
Section 3.05 without any exclusions or defenses; and (iii) nothing in this
Section 3.05(f) shall require such Person to disclose any confidential
information to the Borrower (including, without limitation, its tax returns)
except as may be required by Section 11.17.

(g)           A certificate of the Administrative Agent, the L/C Issuer or any Bank
claiming compensation under this Section 3.05 and setting forth in
reasonable detail the basis for the calculation of the amount or amounts to be
paid to it hereunder shall be conclusive in the absence of manifest error.  In determining such amount, the
Administrative Agent or such Bank may use any reasonable averaging and attribution
methods.

SECTION 4.           Conditions Precedent.  The obligation of the Banks and the L/C
Issuer to make Credit Extensions to the Borrower hereunder is subject, at the
time of the making of each such Credit Extension (except as otherwise
hereinafter indicated), to the satisfaction of each of the following
conditions:

4.01         Effectiveness;
Notes.  On or prior to the Initial
Borrowing Date, (i) the Effective Date shall have occurred, and (ii) there
shall have been delivered to the Administrative Agent for the account

 19
 

of each Bank requesting a
promissory note the appropriate Revolving Note dated the Initial Borrowing
Date, executed by the Borrower in the amount, maturity and as otherwise
provided herein.

4.02         No Default;
Representations and Warranties.  At the
time of the making of each Credit Extension and also after giving effect
thereto, (i) there shall exist no Default or Event of Default and (ii) all
representations and warranties contained herein or in the other Credit
Documents shall be true and correct in all material respects with the same effect
as though such representations and warranties had been made on and as of the
date of the making of such Credit Extension, unless stated to relate to a
specific earlier date, in which case such representations and warranties shall
have been true and correct in all material respects as of such earlier date.

4.03         Officer’s
Certificate.  On or prior to the Initial
Borrowing Date, the Administrative Agent shall have received an officer’s
certificate dated the Initial Borrowing Date, signed by an appropriate officer
of the Borrower, stating that all of the applicable conditions set forth in
Sections 4.02, 4.06, 4.07 and 4.15 have been satisfied as of such date.

4.04         Opinion of Counsel.  On or prior to the Initial Borrowing Date,
the Administrative Agent shall have received an opinion, addressed to the
Administrative Agent and each of the Banks and dated the Initial Borrowing
Date, from Lisa M. Spivack, the General Counsel of Borrower and counsel to the
Credit Parties, with respect to such matters as the Administration Agent may
reasonably request.

4.05         Corporate Proceedings.

(a)           On or prior to the Initial Borrowing Date, the Banks shall have received
from each Credit Party an officer’s certificate, dated the Initial Borrowing
Date, signed by the President or any Vice President of such Credit Party, and
attested to by the Secretary or any Assistant Secretary of such Credit Party,
substantially in the form of Exhibit D hereto with appropriate insertions,
together with (x) copies of the Organizational Documents of such Credit Party
and (y) the resolutions of such Credit Party and the other documents referred
to in such certificate, and the foregoing shall be reasonably satisfactory to
the Administrative Agent.

(b)           All corporate, tax and legal proceedings and all instruments and
agreements in connection with the transactions contemplated by this Agreement
and the other Credit Documents shall be reasonably satisfactory in form and
substance to the Administrative Agent, and the Administrative Agent shall have
received all information and copies of all certificates, documents and papers,
including good standing certificates and any other records of corporate
proceedings and governmental approvals, if any, which the Administrative Agent
reasonably may have requested in connection therewith, such documents and
papers where appropriate to be certified by proper corporate or governmental
authorities.

4.06         No Material Adverse
Effect.  Since December 31, 2005, no
event or circumstance shall have occurred that, individually or in the
aggregate, has had or could reasonably be expected to have a Material Adverse
Effect.

4.07         Litigation.  Except as disclosed on Schedule 5.04, no
actions, suits or proceedings shall be pending or, to the knowledge of any
Responsible Officer of the Borrower, threatened (i) with respect to this
Agreement or any other Credit Document or the transactions contemplated hereby
or thereby or (ii) which, individually or in the aggregate, could (if adversely
determined) reasonably be expected to have a Material Adverse Effect.

 20
 

4.08         Subsidiary Guaranty.  On or prior to the Initial Borrowing Date,
each Subsidiary Guarantor shall have duly authorized, executed and delivered
the Subsidiary Guaranty, dated the Initial Borrowing Date, and the Subsidiary
Guaranty shall be in full force and effect.

4.09         [Intentionally
Omitted].

4.10         [Intentionally
Omitted].

4.11         [Intentionally
Omitted].

4.12         [Intentionally
Omitted].

4.13         [Intentionally
Omitted].

4.14         Financial Statements; Projections.  On or before the Initial Borrowing Date, the
Borrower shall have delivered or caused to be delivered to the Administrative
Agent with copies for each Bank:

(a)           The audited balance sheet of the Borrower and its Subsidiaries (on a
consolidated basis) for the fiscal year ended December 31, 2005, and the
unaudited balance sheet of the Borrower and its Subsidiaries (on a consolidated
basis) for the fiscal quarter ended September 30, 2006, and the related
statements of income, stockholders’ equity and cash flows, in each case
prepared in accordance with GAAP;

(b)           The Annual Statement of each of the Borrower’s Subsidiaries that is a Regulated
Insurance Company for the fiscal year ended December 31, 2005, as filed
with the Applicable Insurance Regulatory Authority, and in each case prepared
in accordance with SAP; and

(c)           Projected financial statements for the Borrower and its Subsidiaries
reflecting the projected financial condition, income and expenses of the
Borrower and its Subsidiaries after giving effect to the Borrowing on the
Initial Borrowing Date, which projected financial statements shall be
reasonably satisfactory in form and substance to the Administrative Agent.

4.15         Approvals, etc.  On or before the Initial Borrowing Date the
following shall have occurred to the reasonable satisfaction of the
Administrative Agent:

(i)            all Governmental Authority and material third
party approvals (including, without limitation, any shareholder approvals),
permits and licenses (including, without limitation, the approval of each
Applicable Insurance Regulatory Authority) required in connection with the
execution, delivery and performance of this Agreement and the other Credit
Documents shall have been obtained and remain in full force and effect; and

(ii)           [Intentionally Omitted].

4.16         Indebtedness.  On the Initial Borrowing Date, the only
Indebtedness for borrowed money of the Borrower and its Subsidiaries shall be
Indebtedness permitted under Section 7.04.

4.17         Payment of Fees.  On or prior to the Initial Borrowing Date,
all costs, fees and expenses (including, without limitation, legal fees and
expenses), and all other compensation required under the terms of the Credit
Documents to be paid on or prior to the Initial Borrowing Date shall have been
paid.

 21
 

4.18         Notice of Borrowing.  The Administrative Agent shall have received
a Notice of Borrowing satisfying the requirements of Section 1.03 with
respect to all Borrowings of Loans.

4.19         Insurance Policies.  On or prior to the Initial Borrowing Date,
the Administrative Agent shall have received evidence of insurance complying
with the requirements of Section 6.03 for the business and properties of
the Borrower and its Subsidiaries, in form and substance reasonably
satisfactory to the Administrative Agent.

4.20         Capital Structure.  On the Initial Borrowing Date, the corporate
and capital structure (and all agreements related thereto) of the Borrower and
its Subsidiaries and all organizational documents of the Credit Parties shall
be reasonably satisfactory to the Administrative Agent.

4.21         Ratings. 
On the Initial Borrowing Date, the Borrower shall have obtained and
maintained ratings of the Indebtedness evidenced by the Other Credit Agreement
by S&P.

The acceptance of the
benefits of the Credit Extensions on the Initial Borrowing Date and on the date
of each Credit Extension thereafter shall constitute a representation and
warranty by the Borrower to each of the Banks and the L/C Issuer that all of
the applicable conditions specified in this Section 4 exist or have been
satisfied as of such date. All of the certificates, legal opinions and other
documents and papers referred to in this Section 4, unless otherwise
specified, shall be delivered to the Administrative Agent at its Notice Office
(or as the Administrative Agent may otherwise direct) for the account of each of
the Banks.

SECTION 5.           Representations,
Warranties and Agreements.  In order to
induce the Banks and the L/C Issuer to enter into this Agreement and to make
the Credit Extensions provided for herein, the Borrower makes the following
representations and warranties to, and agreements with, the Banks and the L/C
Issuer, all of which shall survive the execution and delivery of this Agreement
and the making of the Credit Extensions (with the making of each Credit
Extension being deemed to constitute a representation and warranty that the
matters specified in this Section 5 are true and correct in all material
respects on and as of the date of the making of such Credit Extension unless
such representation and warranty expressly indicates that it is being made as of
any other specific date in which case such representation and warranty shall
have been true and correct in all material respects as of such other specified
date):

5.01         Corporate Status.  The Borrower and each of its Subsidiaries (i)
is a duly organized and validly existing corporation in good standing (where
applicable) under the laws of the jurisdiction of its organization and has the
corporate or other organizational power and authority to own its property and
assets and to transact the business in which it is engaged and presently
proposes to engage and (ii) has been duly qualified and is authorized to do
business and is in good standing (where applicable) in all jurisdictions where
it is required to be so qualified, except where the failure to be so qualified
could not reasonably be expected to have a Material Adverse Effect.

5.02         Corporate Power and
Authority.  Each Credit Party has the
corporate power and authority to execute, deliver and carry out the terms and
provisions of the Credit Documents to which it is a party and has taken all
necessary corporate action to authorize the execution, delivery and performance
of the Credit Documents to which it is a party. 
Each Credit Party has duly executed and delivered each Credit Document
to which it is a party and each such Credit Document constitutes the legal,
valid and binding obligation of such Credit Party enforceable against such
Credit Party in accordance with its terms, except to the extent that
enforceability thereof may be limited by applicable bankruptcy, insolvency,
moratorium or similar laws affecting creditors’ rights generally and general
principles of equity regardless of whether enforcement is sought in a
proceeding in equity or at law.

 22
 

5.03         No Contravention of Laws,
Agreements or Organizational Documents. 
Neither the execution, delivery and performance by any Credit Party of
the Credit Documents to which it is a party nor compliance with the terms and
provisions thereof, nor the consummation of the transactions contemplated
therein (i) will contravene any applicable provision of any law, statute, rule,
regulation, order, writ, injunction or decree of any Governmental Authority,
(ii) will conflict or be inconsistent with or result in any breach of any of
the terms, covenants, conditions or provisions of, or constitute a default
under (except for those which, individually or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect), or result in the
creation or imposition of (or the obligation to create or impose) any Lien upon
any of the property or assets of the Borrower or any of its Subsidiaries
pursuant to the terms of, any material indenture, mortgage, deed of trust, loan
agreement, credit agreement or other agreement to which the Borrower or any of
its Subsidiaries is a party or by which it or any of its property or assets are
bound or to which it may be subject or (iii) will violate any provision of the
Organizational Documents of the Borrower or any of its Subsidiaries.

5.04         Litigation and Contingent Liabilities.

(a)           Except as disclosed on Schedule 5.04, there are no actions, suits or
proceedings pending or, to the knowledge of any Responsible Officer of the
Borrower, threatened in writing involving the Borrower or any of its
Subsidiaries (including, without limitation, with respect to this Agreement or
any other Credit Document) which, individually or in the aggregate, could (if
adversely determined) reasonably be expected to have a Material Adverse Effect.

(b)           Except as fairly reflected in the financial statements described in
Section 5.11(b) (including the footnotes thereto), the Indebtedness
permitted to be incurred under this Agreement and obligations incurred in the
ordinary course of business since the date of the financial statements
described in Section 5.11(b), there are as of the Initial Borrowing Date
(and after giving effect to the Credit Extensions made on such date), no
liabilities or obligations with respect to the Borrower or any of its
Subsidiaries of any nature whatsoever (whether absolute, accrued, contingent or
otherwise and whether or not due), and no Responsible Officer of the Borrower
knows of any basis for the assertion against the Borrower or any of its
Subsidiaries of any such liability or obligation, which, in the case of any of
the foregoing referred to in this clause (b), either individually or in
the aggregate, could reasonably be expected to have a Material Adverse Effect.

5.05         Use of Proceeds; Margin Regulations.

(a)           The proceeds of all Credit Extensions shall be utilized for working
capital, capital expenditures, Permitted Acquisitions and other lawful general
corporate purposes.

(b)           Neither the making of any Credit Extension hereunder, nor the use of the
proceeds thereof, will violate or be inconsistent with the provisions of Regulation
T, U or X of the Board of Governors of the Federal Reserve System and no part
of the proceeds of any Credit Extension will be used to purchase or carry any
Margin Stock or to extend credit for the purpose of purchasing or carrying any
Margin Stock.

5.06         Approvals.  Except for (i) filings and approvals made or
obtained on or prior to the Initial Borrowing Date and (ii) those filings or
approvals the failure of which to make or obtain, either individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect,
no order, consent, approval, license, authorization, or validation of, or
filing, recording or registration with, or exemption by, any foreign or
domestic Governmental Authority is required to authorize or is required prior
to the Initial Borrowing Date in connection with (i) the execution, delivery
and performance of any

 23
 

Credit Document, (ii) the
legality, validity, binding effect or enforceability of any Credit Document or
(iii) the consummation of any transactions contemplated by any Credit Document.

5.07         Investment Company
Act.  No Credit Party is an “investment
company” or a company “controlled” by an “investment company,” within the
meaning of the Investment Company Act of 1940, as amended.

5.08         [Intentionally
Omitted].

5.09         True and Complete
Disclosure; Projections and Assumptions. 
All written factual information (taken as a whole) heretofore or
contemporaneously herewith furnished by or on behalf of the Borrower or any of
its Subsidiaries to the Administrative Agent or any Bank (including, without
limitation, all information contained in the Credit Documents, but excluding
any projections) for purposes of or in connection with this Agreement or any
transaction contemplated herein is true and accurate in all material respects
on the date as of which such information is dated and not materially incomplete
by omitting to state any material fact necessary to make such information
(taken as a whole) not misleading in any material respect at such time in light
of the circumstances under which such information was provided.  All projections heretofore or
contemporaneously herewith furnished by or on behalf of the Borrower or any of
its Subsidiaries to the Administrative Agent or any Bank are based on good
faith estimates and assumptions believed by the Borrower to be reasonable and
attainable at the time made, it being recognized by the Banks that such
projections as to future events are not to be viewed as facts and that actual
results during the period or periods covered by any such projections may differ
from the projected results.

5.10         [Intentionally
Omitted].

5.11         Financial Condition; Financial Statements.

(a)           On and as of the Initial Borrowing Date, on a pro forma basis after
giving effect to the transactions contemplated by the Credit Agreement and all
Indebtedness incurred, and to be incurred, on the Initial Borrowing Date, with
respect to each of the Borrower (on a stand-alone basis) and the Borrower and
its Subsidiaries (on a consolidated basis) (x) the sum of the assets, at a fair
valuation, of each of the Borrower (on a stand-alone basis) and the Borrower
and its Subsidiaries (on a consolidated basis) will exceed their debts, (y) the
Borrower (on a stand-alone basis) and the Borrower and its Subsidiaries (on a consolidated
basis) will not have incurred or intended to, or believe that they will, incur
debts beyond their ability to pay such debts as such debts mature and (z) the
Borrower (on a stand-alone basis) and the Borrower and its Subsidiaries (on a
consolidated basis) will have sufficient capital with which to conduct its or
their business. For purposes of this Section 5.11(a), “debt” means any
liability on a claim, and “claim” means (i) right to payment whether or not
such a right is reduced to judgment, liquidated, unliquidated, fixed,
contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured
or unsecured, or (ii) right to an equitable remedy for breach of performance if
such breach gives rise to a payment, whether or not such right to an equitable
remedy is reduced to judgment, fixed, contingent, matured, unmatured, disputed,
undisputed, secured or unsecured.

(b)           The audited balance sheets of the Borrower and its Subsidiaries (on a
consolidated basis) for the fiscal year ended December 31, 2005, and the
unaudited balance sheets of the Borrower and its Subsidiaries (on a
consolidated basis) for the fiscal quarter ended September 30, 2006,
together with the related statements of income, stockholders’ equity and cash
flows of such Persons for the fiscal year and fiscal quarter, respectively,
ended on such dates, heretofore delivered to the Banks, have been prepared in
accordance with GAAP and

 24
 

present fairly in all material respects the
financial position of such Persons at the dates of said statements and the
results of operations for the periods covered thereby.

(c)           The audited Annual Statement of each of the Borrower’s Subsidiaries
which is a Regulated Insurance Company for the fiscal year ended
December 31, 2005, heretofore filed with the Applicable Insurance
Regulatory Authority and delivered to the Banks, have been prepared in
accordance with SAP and present fairly in all material respects the financial
position of such Persons at the dates of said statements and the results of
operations for the periods covered thereby.

(d)           Since December 31, 2005, there has been no event or circumstance
that, individually or in the aggregate, has had or could reasonably be expected
to have a Material Adverse Effect.

5.12         [Intentionally Omitted].

5.13         Tax Returns and
Payments.  Except as set forth on
Schedule 5.13, the Borrower and each of its Subsidiaries has filed all federal
income tax returns and all other material tax returns, domestic and foreign,
required to be filed by it and has paid all material taxes and assessments
payable by it which have become due, other than those not yet delinquent and
except for those contested in good faith and adequately disclosed and fully
provided for in the financial statements of the Borrower and each of its Subsidiaries
in accordance with GAAP or SAP, as the case may be. The Borrower and each of
its Subsidiaries has paid, or has provided adequate reserves (in the good faith
judgment of the management of such Person) for the payment of, all material
federal, state and foreign taxes applicable for all prior fiscal years and for
the current fiscal year to the date hereof. 
Except as disclosed on Schedule 5.13, there is no material action, suit,
proceeding, investigation, audit or claim now pending or, to the knowledge of
any Responsible Officer of the Borrower or any of its Subsidiaries, threatened
in writing by any Governmental Authority regarding any material taxes relating
to the Borrower or any of its Subsidiaries. Except as disclosed on Schedule
5.13, neither the Borrower nor any of its Subsidiaries has entered into an
agreement or waiver or been requested to enter into an agreement or waiver
extending any statute of limitations relating to the payment or collection of
taxes of the Borrower or any of its Subsidiaries, and no Responsible Officer of
the Borrower is aware of any circumstances that would cause the taxable years
or other taxable periods of the Borrower or any of its Subsidiaries not to be
subject to the normally applicable statute of limitations.

5.14         Compliance with
ERISA.  (a) Schedule 5.14 sets forth each
Plan. Except as disclosed on Schedule 5.14, (i) each Plan (and each related
trust, insurance contract or fund) is in substantial compliance with its terms
and with all applicable laws, including without limitation ERISA and the Code,
except for noncompliance which, either individually or in the aggregate, could
not reasonably be expected to have a Material Adverse Effect; (ii) each Plan
(and each related trust, if any) which is intended to be qualified under
Section 401(a) of the Code has received a determination letter from the
Internal Revenue Service to the effect that it meets the requirements of
Sections 401(a) and 501(a) of the Code; (iii) no Reportable Event has
occurred except for any Reportable Event which, either individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect;
(iv) no Plan which is a multiemployer plan (as defined in Section 4001(a)
(3) of ERISA) is insolvent or in reorganization; (v) no Plan has an Unfunded
Current Liability, except for any Unfunded Current Liability which, either
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect; (vi) no Plan which is subject to Section 412 of
the Code or Section 302 of ERISA has an accumulated funding deficiency,
within the meaning of such Sections of the Code or ERISA, or has applied
for or received a waiver of an accumulated funding deficiency or an extension
of any amortization period, within the meaning of Section 412 of the Code
or Section 303 or 304 of ERISA, except where such deficiency,

 25
 

either individually or in
the aggregate, could not reasonably be expected to have a Material Adverse
Effect; (vii) all contributions required to be made with respect to a Plan have
been timely made, except for any such contribution which, if not timely made,
could not reasonably be expected to have a Material Adverse Effect; (viii)
neither the Borrower nor any Subsidiary of the Borrower nor any ERISA Affiliate
has incurred any material liability (including any indirect, contingent or
secondary liability) to or on account of a Plan pursuant to Section 409,
502(i), 502(1), 515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or
Section 401(a)(29), 4971 or 4975 of the Code or expects to incur any
material amount of such liability under any of the foregoing Sections with
respect to any Plan; (ix) to the knowledge of any Responsible Officer of the
Borrower, no condition exists which presents a material risk to the Borrower or
any Subsidiary of the Borrower or any ERISA Affiliate of incurring a material
amount of liability to or on account of a Plan pursuant to the foregoing
provisions of ERISA and the Code except for any condition which, either
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect; (x) no proceedings have been instituted by the PBGC to
terminate or appoint a trustee to administer any Plan which is subject to Title
IV of ERISA in a distress termination; (xi) no action, suit, proceeding,
hearing, audit or investigation with respect to the administration, operation
or the investment of assets of any Plan (other than routine claims for benefits
or relating to qualified domestic relations orders) is pending or, to the
knowledge of any Responsible Officer, threatened, which, either individually or
in the aggregate, could reasonably be expected to have a Material Adverse
Effect; (xii) no Plan is a multiemployer plan (as defined in
Section 4001(a)(3) of ERISA); (xiii) neither the Borrower nor any
Subsidiary of the Borrower nor any ERISA Affiliate has incurred any material
liability as a result of any group health plan (as defined in
Section 607(1) of ERISA or Section 4980B(g)(2) of the Code) other
than a multiemployer plan described in Section 3(37) of ERISA which covers
or has covered employees or former employees of the Borrower, any Subsidiary of
the Borrower or any ERISA Affiliate having not been operated in compliance with
the provisions of Part 6 of subtitle B of Title I of ERISA and
Section 4980B of the Code which, either individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect; (xiv) no lien
imposed under the Code or ERISA on the assets of the Borrower or any Subsidiary
of the Borrower or any ERISA Affiliate exists or is likely to arise on account
of any Plan and (xv) except with respect to certain post-retirement health care
obligations, as disclosed on Schedule 5.14, the Borrower and its Subsidiaries
may cease contributions to or terminate any employee benefit plan maintained by
any of them without incurring any material liability.

5.15         Subsidiaries.

(a)           Schedule 5.15 lists each Subsidiary of the Borrower (and the direct and
indirect ownership interest of the Borrower therein) and also identifies the
owner thereof, in each case existing on the Initial Borrowing Date.  All such Subsidiaries are direct or indirect
Wholly-Owned Subsidiaries of the Borrower.

(b)           All of the outstanding shares of capital stock of each Subsidiary of the
Borrower listed on Schedule 5.15 have been duly authorized and validly issued
and are fully paid and nonassessable and free from preemptive rights.

(c)           Except as set forth on Schedule 5.15, no Subsidiary of the Borrower
listed on Schedule 5.15 has outstanding any securities convertible into or
exchangeable for its capital stock or outstanding any rights to subscribe for
or to purchase, or any options for the purchase of, or any agreements providing
for the issuance (contingent or otherwise) of, or any calls, commitments or
claims of any character relating to, its capital stock.

(d)           There are no restrictions on the Borrower or any of its Subsidiaries
which prohibit or otherwise restrict the transfer of cash or other assets from
any Subsidiary of the Borrower to the Borrower, other than prohibitions or
restrictions existing under or by reason of (i)

 26
 

this Agreement or the other Credit Documents
or the Other Credit Agreement or the other Credit Documents (as defined in the
Other Credit Agreement), (ii) Legal Requirements, (iii) customary
non-assignment provisions in contracts entered into in the ordinary course of
business and consistent with past practices, and (iv) purchase money
obligations for property acquired in the ordinary course of business, so long as
such obligations are permitted under this Agreement.

5.16         Intellectual Property,
etc.  The Borrower and each of its
Subsidiaries own or possess the right to use all material patents, trademarks,
servicemarks, trade names, copyrights, licenses and other rights, free from
burdensome restrictions, that are necessary for the operation of their
respective businesses as presently conducted and as proposed to be conducted.

5.17         Pollution and Other
Regulations.  The Borrower and each of
its Subsidiaries are in compliance with all laws and regulations relating to
pollution and environmental control, equal employment opportunity and employee
safety in all domestic and foreign jurisdictions in which the Borrower and each
of its Subsidiaries is presently doing business, and the Borrower will comply
and cause each of its Subsidiaries to comply with all such laws and regulations
which may be imposed in the future in jurisdictions in which the Borrower or
such Subsidiary may then be doing business; in each case other than those the
non-compliance with which could not reasonably be expected to have a Material
Adverse Effect.

5.18         Labor Relations; Collective Bargaining
Agreements.

(a)           Set forth on Schedule 5.18 is a list and description (including dates of
termination) of all collective bargaining and similar agreements between or
applicable to the Borrower or any of its Subsidiaries and any union, labor
organization or other bargaining agent in respect of the employees of the
Borrower and/or any Subsidiary on the Initial Borrowing Date.

(b)           Neither the Borrower nor any of its Subsidiaries is engaged in any
unfair labor practice that is reasonably likely to have a Material Adverse
Effect. (i) There is no significant unfair labor practice complaint pending
against the Borrower or any of its Subsidiaries or threatened in writing
against any of them, before the National Labor Relations Board, and no
significant grievance or significant arbitration proceeding arising out of or
under any Collective Bargaining Agreement is now pending against the Borrower
or any of its Subsidiaries or threatened in writing against any of them, (ii)
there is no significant strike, labor dispute, slowdown or stoppage pending
against the Borrower or any of its Subsidiaries or threatened in writing against
the Borrower or any of its Subsidiaries and (iii) to the best knowledge of the
Borrower, no union representation question exists with respect to the employees
of the Borrower or any of its Subsidiaries, except (with respect to any matter
specified in clause (i), (ii) or (iii) above, either individually or in
the aggregate) such as could not reasonably be expected to have a Material
Adverse Effect.

5.19         [Intentionally
Omitted].

5.20         Indebtedness.  Schedule 5.20 sets forth a true and complete
list of all Indebtedness outstanding under Sections 7.04(c) of the
Borrower and its Subsidiaries as of the Initial Borrowing Date, in each case
showing the aggregate principal amount thereof, the name of the lender in
respect thereof and the name of the respective borrower and any other entity
which has directly or indirectly guaranteed such Indebtedness.

5.21         Compliance with Statutes,
etc.  The Borrower and each of its
Subsidiaries is in compliance with all applicable statutes, regulations and
orders of, and all applicable restrictions imposed

 27

by, all Governmental
Authorities in respect of the conduct of its business and the ownership of its
property (including compliance with all applicable environmental laws), except
those the noncompliance with which could not, in the aggregate, reasonably be
expected to have a Material Adverse Effect.

5.22         Insurance Licenses.  Each Regulated Insurance Company has obtained
and maintains in full force and effect all licenses and permits from all
regulatory authorities necessary to operate in the jurisdictions in which such
Regulated Insurance Company operates, in each case other than such licenses and
permits the failure to obtain or maintain, individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect.

SECTION 6.           Affirmative
Covenants.  The Borrower hereby covenants
and agrees that on the Effective Date and thereafter, for so long as this
Agreement is in effect and until the Loans, together with interest, Fees and
all other Obligations incurred hereunder are paid in full and all Letters of
Credit are terminated or expired:

6.01         Information
Covenants.  The Borrower will furnish or
cause to be furnished to each Bank:

(a)           Annual Financial Statements.

(i)            As soon as available or required to be filed
with the SEC and in any event within 90 days after the close of each fiscal
year of the Borrower, (x) the consolidated balance sheet of the Borrower and
its Subsidiaries, in each case, as at the end of such fiscal year and the
related consolidated statements of income, of stockholders’ equity and of cash
flows for such fiscal year and (y) the consolidating balance sheet of the
Borrower and each of its Subsidiaries as at the end of the fiscal year and the
related consolidating statements of income, of stockholders’ equity and of cash
flows for such fiscal year; in each case prepared in accordance with GAAP and
setting forth comparative figures for the preceding fiscal year, and, in the
case of such consolidated statements, examined by independent certified public
accountants of recognized national standing whose opinion shall not be
qualified as to the scope of audit or as to the status of the Borrower and its
Subsidiaries as a going concern, together with a certificate of such accounting
firm stating that in the course of its regular audit of the business of the
Borrower and its Subsidiaries, which audit was conducted in accordance with
GAAP, such accounting firm has obtained no knowledge of Event of Default in
respect of the financial covenants in Sections 7.10, 7.11, 7.12, 7.13 and
7.14 which has occurred and is continuing or, if to the knowledge of such
accounting firm such Event of Default has occurred and is continuing, a
statement as to the nature thereof.

(ii)           As soon as available and in any event within 90 days after the close of
each fiscal year of each Regulated Insurance Company, the Annual Statement
(prepared in accordance with SAP) for such fiscal year of such Regulated
Insurance Company, as filed with the Applicable Insurance Regulatory Authority
in compliance with the requirements thereof (or a report containing equivalent
information for any Regulated Insurance Company not so required to file the
foregoing with the Applicable Insurance Regulatory Authority) together with the
opinion thereon of the chief financial officer or other Authorized Officer of
such Regulated Insurance Company stating that such Annual Statement presents
fairly in all material respects the financial condition and results of
operations of such Regulated Insurance Company in accordance with SAP.

 28
 

(iii)          In the event any Regulated Insurance Company is required to obtain or
otherwise elects to obtain an audit of its annual financial statements prepared
in accordance with SAP, as soon as available, the audit report and opinion of
the firm of independent certified public accountants that conducted such audit.

(iv)          As soon as available and in any event within 90 days after the close of
each fiscal year of the Borrower, a copy of the “Statement of Actuarial Opinion”
and “Management Discussion and Analysis” for each Regulated Insurance Company
(prepared in accordance with SAP) for such fiscal year and as filed with the
Applicable Insurance Regulatory Authority in compliance with the requirements
thereof (or a report containing equivalent information for any Regulated
Insurance Company not so required to file the foregoing with the Applicable
Insurance Regulatory Authority).

(b)           Quarterly Financial Statements.

(i)            As soon as available or required to be filed
with the SEC and in any event within 55 days after the close of each of the
first three quarterly accounting periods in each fiscal year of the Borrower,
(x) the consolidated balance sheet of the Borrower and its Subsidiaries at the
end of such fiscal quarter and the related consolidated statements of income,
of stockholders’ equity and of cash flows for such quarterly period and for the
elapsed portion of the fiscal year ended with the last day of such quarterly
period and (y) the consolidating balance sheet of the Borrower and each of its
Subsidiaries as at the end of such fiscal quarter and the related consolidating
statements of income, of stockholders’ equity and of cash flows for such
quarterly period and for the elapsed portion of the fiscal year ended with the
last day of such quarterly period; in each case setting forth comparative
figures for the related periods in the prior fiscal year, and all of which
shall be prepared in accordance with GAAP and certified by the chief financial
officer or other Authorized Officer of the Borrower, as the case may be, subject
to changes resulting from normal year-end audit adjustments.

(ii)           As soon as available or required to be filed with an Applicable
Insurance Regulatory Authority and in any event within 55 days after the close
of each of the first three quarterly accounting periods in each fiscal year of
each Regulated Insurance Company, quarterly financial statements (prepared in
accordance with SAP) for such fiscal period of such Regulated Insurance
Company, as filed with the Applicable Insurance Regulatory Authority, together
with the opinion thereon of the chief financial officer or other Authorized
Officer of such Regulated Insurance Company stating that such financial
statements present fairly in all material respects the financial condition and
results of operations of such Regulated Insurance Company in accordance with
SAP.

(c)           Financial Plans, etc.  As soon as
available and in any event no later than 120 days following the first day of
each fiscal year of the Borrower, copies of the annual financial plan or budget
for such fiscal year prepared by management of the Borrower for its internal
use and distributed to the Board of Directors of the Borrower, and together
with each delivery of financial statements pursuant to Section 6.01(a)(ii)
and (b)(ii), a comparison of the current year to date financial results (other
than in respect of the balance sheets included therein) against the plans
required to be submitted pursuant to this clause (c).

(d)           Compliance Certificates. At the time of the delivery of the financial statements
provided for in Sections 6.01(a)(i) and (ii) and (b)(i) and (ii), a
Compliance Certificate executed by the chief financial officer or other
Authorized Officer of the Borrower to the effect that no

 29
 

Default or Event of Default exists or, if any
Default or Event of Default does exist, specifying the nature and extent
thereof, which Compliance Certificate shall include (x) the calculations (with
supporting details) required to establish whether the Borrower and its
Subsidiaries were in compliance with the provisions of Sections 7.10,
7.11, 7.12, 7.13 and 7.14 as at the end of such fiscal year or quarter, as the
case may be, and (y) a summary of all outstanding litigation at the end of such
fiscal year or quarter and of all litigation settled during the fiscal quarter
then ended, in each case involving the Borrower or any of its Subsidiaries, but
only to the extent that any such litigation, either individually or in the
aggregate, could (if adversely determined) reasonably be expected to have a
Material Adverse Effect.

(e)           Notice of Default or Litigation. Promptly, and in any event within five
Business Days after any Responsible Officer of the Borrower or any of its
Subsidiaries obtains knowledge thereof, (x) notice of the occurrence of any
event which constitutes a Default or Event of Default, which notice shall
specify the nature thereof, the period of existence thereof and what action the
Borrower proposes to take with respect thereto and (y) promptly after any
Responsible Officer of the Borrower or any of its Subsidiaries obtains
knowledge thereof, notice of any outstanding litigation or governmental or
regulatory proceeding pending against the Borrower or any of its Subsidiaries
which, either individually or in the aggregate, could (if adversely determined)
reasonably be expected to have a Material Adverse Effect.

(f)            Auditors’ Reports. Promptly upon receipt
thereof, a copy of (x) each other report or “management letter” submitted to
the Borrower or any of its Subsidiaries by their independent accountants in
connection with any annual, interim or special audit made by them of the books
of the Borrower or any of its Subsidiaries and (y) each report submitted to the
Borrower or any of its Subsidiaries by any independent actuary with respect to
reserve adequacy.

(g)           Reserve Adequacy Report. Promptly (x) following a request for such a
report from the Administrative Agent or the Required Banks (which request may
only be made when an Event of Default has occurred and is continuing) and (y)
following the receipt of such a report by the Borrower (if the Borrower
otherwise elects to obtain such a report), a report prepared by an independent
actuarial consulting firm of recognized professional standing reasonably
satisfactory to the Administrative Agent, the Required Banks or the Borrower,
as the case may be, reviewing the adequacy of reserves of each Regulated
Insurance Company determined in accordance with SAP, which firm shall be
provided access to or copies of all reserve analyses and valuations relating to
the insurance business of each Regulated Insurance Company in the possession of
or available to the Borrower or its Subsidiaries.

(h)           Other Regulatory Statements and Reports. Promptly (A) after receipt
thereof, copies of all triennial examinations and risk adjusted capital reports
of any Regulated Insurance Company, delivered to such Person by any Applicable
Insurance Regulatory Authority, insurance commission or similar regulatory
authority, (B) after receipt thereof, written notice of any assertion by any Applicable
Insurance Regulatory Authority or any governmental agency or agencies
substituted therefor, as to a violation of any Legal Requirement by any
Regulated Insurance Company which is likely to have a Material Adverse Effect,
(C) after receipt thereof, a copy of the final report to each Regulated
Insurance Company from the NAIC for each fiscal year, as to such Regulated
Insurance Company’s compliance or noncompliance with each of the NAIC Tests,
(D) after receipt thereof, a copy of any notice of termination, cancellation or
recapture of any Reinsurance Agreement or Retrocession Agreement to which a
Regulated Insurance Company is a party to the extent such termination or
cancellation is likely to have a Material Adverse Effect, (E) and in any event
within two Business Days after receipt thereof, copies of any notice of actual
suspension, termination or revocation of any license of any

 30
 

Regulated Insurance Company by any Applicable
Insurance Regulatory Authority, including any request by an Applicable Insurance
Regulatory Authority which commits a Regulated Insurance Company to take or
refrain from taking any action or which otherwise affects the authority of such
Regulated Insurance Company to conduct its business, and (F) and in any event
within ten Business Days after any Responsible Officer of the Borrower or any
of its Subsidiaries obtains knowledge thereof, notice of any actual changes in
the insurance laws enacted in any jurisdiction in which any Regulated Insurance
Company is domiciled which could reasonably be expected to have a Material
Adverse Effect.

(i)            Other Information. Promptly upon filing
thereof with the SEC or transmission thereof, as the case may be, copies of any
final registrations and documents, and other reports specified in
Section 13 and 15(d) of the Exchange Act filed by the Borrower or any of
its Subsidiaries (other than any registration statement on Form S-8) and copies
of all financial statements and proxy statements, and material notices and
reports, as the Borrower or any of its Subsidiaries shall send to analysts
generally or the holders of their capital stock in their capacity as such
holders (in each case to the extent not theretofore delivered to the Banks
pursuant to this Agreement) and, with reasonable promptness, such other information
or existing documents (financial or otherwise) as the Administrative Agent or
any Bank may reasonably request from time to time.

6.02         Books, Records and
Inspections.  The Borrower will, and will
cause each of its Subsidiaries to, permit officers and designated
representatives of the Administrative Agent or any Bank to visit and inspect
any of the properties or assets of the Borrower and any of its Subsidiaries in
whomsoever’s possession (but only to the extent the Borrower or such Subsidiary
has the right to do so to the extent in the possession of another Person), and
to examine the books of account of the Borrower and any of its Subsidiaries and
discuss the affairs, finances and accounts of the Borrower and of any of its
Subsidiaries with, and be advised as to the same by, its and their officers and
independent accountants and independent actuaries, if any, all at such
reasonable times and intervals, upon reasonable prior notice and to such
reasonable extent as the Administrative Agent or any Bank may request.  The Borrower and any of its Subsidiaries
shall have the right to be present during all discussions between the relevant
independent accountants and the Administrative Agent and/or any of the Banks.

6.03         Insurance.  The Borrower will, and will cause each of its
Subsidiaries to, at all times maintain in full force and effect insurance in
such amounts, covering such risks and liabilities and with such deductibles or
self-insured retentions as are in accordance with normal industry practice.

6.04         Payment of Taxes.  The Borrower will file, and will cause each
of its Subsidiaries to file, tax returns in accordance with the tax allocation
agreements among the Borrower and its Subsidiaries and with the requirements of
applicable law.  The Borrower will pay
and discharge, and will cause each of its Subsidiaries to pay and discharge,
all material taxes, assessments and governmental charges or levies imposed upon
it or upon its income or profits, or upon any properties belonging to it, prior
to the date on which penalties attach thereto, and all lawful claims (other
than claims relating to the adjustment or settling, in the ordinary course of
business, of claims in respect of insurance policies or reinsurance contracts)
which, if unpaid, might become a Lien or charge upon any properties of the
Borrower or any of its Subsidiaries; provided that neither the Borrower nor any
Subsidiary shall be required to pay any such tax, assessment, charge, levy or
claim which is being contested in good faith and by proper proceedings if it
has maintained adequate reserves (in the good faith judgment of the management
of the Borrower) with respect thereto in accordance with GAAP or SAP, as may be
applicable.

6.05         Corporate
Franchises.  The Borrower will do, and
will cause each Subsidiary to do, or cause to be done, all things reasonably
necessary to preserve and keep in full force and effect its corporate

 31
 

existence, rights and
authority; provided that any transaction permitted by Section 7.02 will
not constitute a breach of this Section 6.05.

6.06         Compliance with Statutes,
etc.  The Borrower will, and will cause
each Subsidiary to, comply with all applicable statutes, regulations and orders
of, and all applicable restrictions imposed by, all Government Authorities, in
respect of the conduct of its business and the ownership of its property
(including applicable statutes, regulations, orders and restrictions relating
to environmental standards and controls) other than those the non-compliance
with which could not, in the aggregate, reasonably be expected to have a
Material Adverse Effect.

6.07         ERISA.  As soon as possible and, in any event, within
10 Business Days after any Responsible Officer of the Borrower, any Subsidiary
of the Borrower or any ERISA Affiliate knows of the occurrence of any of the
following, the Borrower will deliver to the Administrative Agent a certificate
of the chief financial officer of the Borrower setting forth the full details
as to such occurrence and the action, if any, that the Borrower, such Subsidiary
or such ERISA Affiliate is required or proposes to take, together with any
notices required or proposed to be given to or filed with or by the Borrower,
the Subsidiary, the ERISA Affiliate, the PBGC, a Plan participant or the Plan
administrator with respect thereto: that a Reportable Event has occurred; that
an accumulated funding deficiency, within the meaning of Section 412 of
the Code or Section 302 of ERISA, has been incurred or an application may
be or has been made for a waiver or modification of the minimum funding
standard (including any required installment payments) or an extension of any
amortization period under Section 412 of the Code or Section 303 or
304 of ERISA with respect to a Plan; that any contribution required to be made
with respect to a Plan has not been timely made except to the extent that any
such untimely contribution would not result in a material liability to the
Borrower, any Subsidiary of the Borrower or any ERISA Affiliate; that a Plan
has been or may be terminated, reorganized, partitioned or declared insolvent
under Title IV of ERISA; that a Plan has an Unfunded Current Liability; that
proceedings may be or have been instituted to terminate or appoint a trustee to
administer a Plan which is subject to Title IV of ERISA; that a proceeding has
been instituted pursuant to Section 515 of ERISA to collect a delinquent
contribution to a Plan; that the Borrower, any Subsidiary of the Borrower or
any ERISA Affiliate will or may incur any material amount of liability (including
any indirect, contingent, or secondary liability) to or on account of the
termination of or withdrawal from a Plan under Section 4062, 4063, 4064,
4069, 4201, 4204 or 4212 of ERISA or with respect to a Plan under
Section 401(a)(29), 4971, 4975 or 4980 of the Code or Section 409 or
502(i) or 502(l) of ERISA or with respect to a group health plan (as defined in
Section 607(1) of ERISA or Section 4980B(g)(2) of the Code) under
Section 4980B of the Code; or that the Borrower or any Subsidiary of the
Borrower may incur any material liability pursuant to any employee welfare
benefit plan (as defined in Section 3(1) of ERISA) that provides death,
health or severance benefits to retired employees or other former employees
(other than as required by Section 601 of ERISA or applicable state law or
as disclosed on Schedule 5.14) of any Plan. At the request of any Bank, the
Borrower will promptly deliver to such Bank a complete copy of the annual
report (on Internal Revenue Service Form 5500-series) of each Plan (including,
to the extent required, the related financial and actuarial statements and
opinions and other supporting statements, certifications, schedules and
information) required to be filed with the Internal Revenue Service. In
addition to any certificates or notices delivered to the Banks pursuant to the
first sentence hereof, if requested by the Banks, copies of annual reports and
any material notices received by the Borrower, any Subsidiary of the Borrower
or any ERISA Affiliate with respect to any Plan shall be delivered to the Banks
no later than 10 Business Days after the date such notice has been received by
the Borrower, the Subsidiary or the ERISA Affiliate, as applicable.

6.08         Performance of
Obligations.  The Borrower will, and will
cause each of its Subsidiaries to, perform in all material respects all of its
obligations under the terms of each material mortgage, indenture, security
agreement, other debt instrument and contract by which it is bound or to which
it is a

 32
 

party unless the failure
to do so could not reasonably be expected to have a Material Adverse Effect;
provided that the failure to pay any Indebtedness shall not constitute a breach
of this Section 6.08 unless it shall give rise to an Event of Default
under Section 8.04.

6.09         Good Repair.  The Borrower will, and will cause each of its
Subsidiaries to, ensure that its material properties and equipment necessary to
carry on its business are kept in good repair, working order and condition,
normal wear and tear excepted.

6.10         End of Fiscal Years;
Fiscal Quarters.  The Borrower will, for
financial reporting purposes, cause (i) each of its, and each of its
Subsidiaries’, fiscal years to end on December 31 of each year and (ii)
each of its, and each of its Subsidiaries’, fiscal quarters to end on March 31,
June 30, September 30 and December 31 of each year.

6.11         Maintenance of Licenses
and Permits.  The Borrower will, and will
cause each of its Subsidiaries to, maintain all permits, licenses and consents
as may be required for the conduct of its business by any state, federal or
local government agency or instrumentality except where failure to maintain the
same could not, either individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect.

6.12         Register.  The Borrower hereby designates the
Administrative Agent to serve as its agent, solely for purposes of this
Section 6.12, to maintain a register (the “Register”) on which it will
record the names and addresses of each of the Banks and the L/C Issuer, the
Commitments from time to time of each of the Banks, the Loans (and Outstanding
Amounts thereof) made by each of the Banks, the Letters of Credit issued by the
L/C Issuer, the participations in L/C Obligations held by each of the Banks and
each payment of principal and interest on the Loans and the participations in
the L/C Obligations owing to each Bank. 
Failure to make any such recordation or any error in such recordation
shall not affect the obligations of the Borrower in respect of such Loans or
L/C Obligations.  With respect to any
Bank, the transfer of the Commitments of such Bank, the transfer of the rights
to the principal of, and interest on, any Loan made pursuant to such
Commitments and the transfer of participations in L/C Obligations held by such
Bank, shall not be effective until such transfer is recorded on the Register
maintained by the Administrative Agent with respect to ownership of such
Commitments, Loans and participations in L/C Obligations and prior to such
recordation all amounts owing to the transferor with respect to such
Commitments, Loans and participations in L/C Obligations shall remain owing to
the transferor. The registration of assignment or transfer of all or part of
any Commitments, Loans and participations in L/C Obligations shall be recorded
by the Administrative Agent on the Register only upon the acceptance by the
Administrative Agent of a properly executed and delivered Assignment and
Assumption Agreement pursuant to Section 11.04(b), together with all other
items required to be delivered in accordance with Section 11.04(b).
Coincident with the delivery of such an Assignment and Assumption Agreement to
the Administrative Agent for acceptance and registration of assignment or
transfer of all or part of a Loan, or as soon thereafter as practicable, the
assigning or transferor Bank shall surrender the Note (if any) evidencing such
Loan, and thereupon one or more new Notes in the same aggregate principal
amount shall be issued to the assigning or transferor Bank and/or the new Bank,
upon each such Bank’s request.  Except as
otherwise provided in Section 3.05(b), the Borrower agrees to indemnify
the Administrative Agent from and against any and all losses, claims, damages
and liabilities of whatsoever nature which may be imposed on, asserted against
or incurred by the Administrative Agent in performing its duties under this
Section 6.12 (but excluding any such losses, liabilities, claims, damages
or expenses to the extent incurred by reason of the gross negligence or willful
misconduct of the Administrative Agent).

6.13         Ratings. 
The Borrower will maintain a rating of the Indebtedness evidenced by the
Other Credit Agreement by S&P.

 33
 

SECTION 7.           Negative
Covenants.  The Borrower hereby covenants
and agrees that on the Effective Date and thereafter, for so long as this
Agreement is in effect and until the Loans together with interest, Fees and all
other Obligations incurred hereunder are paid in full and all Letters of Credit
are terminated or expired:

7.01         Changes in Business.

(a)           Except as otherwise permitted under this Agreement, the Borrower will
not permit any of its Subsidiaries to engage in any business other than the
businesses engaged in by the Borrower and its Subsidiaries as of the Effective
Date and activities related, ancillary or complimentary thereto.

(b)           The Borrower will engage in no business other than (i) the ownership of
the capital stock and other equity interests in its Subsidiaries, (ii) the
incurrence of Indebtedness permitted to be incurred by it under
Section 7.04, (iii) Permitted Acquisitions, (iv) paying taxes, (v)
preparing reports to Governmental Authorities and to its shareholders, (vi)
holding directors and shareholders meetings, preparing corporate records and
engaging in other corporate activities required to maintain its separate
corporate structure, (vii) transactions otherwise permitted under the Credit
Documents and (viii) the entering into and performing of its obligations under
the Credit Documents.

7.02         Consolidation, Merger,
Sale or Purchase of Assets.  The Borrower
will not, and will not permit any of its Subsidiaries to, wind up, liquidate or
dissolve its affairs, or enter into any transaction of merger or consolidation,
or sell or otherwise dispose of any of its property or assets (including the
sale of capital stock of any of its Subsidiaries, but excluding any sale or
disposition of property or assets in the ordinary course of business), or
purchase, lease or otherwise acquire (in one transaction or a series of related
transactions) all or any part of the property or assets of any Person
(excluding any purchases, leases or other acquisitions of property or assets
in, and for use in, the ordinary course of business) or agree to do any of the
foregoing at any future time, except that the following shall be permitted:

(a)           [Intentionally Omitted]

(b)           Capital Expenditures by the Borrower and its Subsidiaries to the extent
permitted by Section 7.05;

(c)           The investments, acquisitions and transfers or dispositions of property
permitted pursuant to Section 7.06;

(d)           The merger or consolidation or liquidation of (i) any Wholly-Owned
Subsidiary of the Borrower with or into another Wholly-Owned Subsidiary of the
Borrower or (ii) any Non-Regulated Company that is a Wholly-Owned Subsidiary of
the Borrower with or into the Borrower, so long as the Borrower is the
surviving entity following such merger, consolidation or liquidation;

(e)           Any Regulated Insurance Company may enter into any Insurance Contract,
Reinsurance Agreement or Retrocession Agreement in the ordinary course of business
in accordance with its normal underwriting, indemnity and retention policies,
provided that no Regulated Insurance Company shall enter into any Financial
Reinsurance Agreement;

(f)            The Borrower or any of its Subsidiaries may
enter into leases of property or assets in the ordinary course of business not
otherwise in violation of this Agreement;

 34
 

(g)           The sale or disposition of equipment that has become obsolete or worn
out or is replaced in the ordinary course of business and the replacement
thereof;

(h)           Each of the Borrower and its Subsidiaries may sell assets, provided that
(w) each such sale shall be for an amount at least equal to the fair market
value thereof (as determined in good faith by senior management of the
Borrower), (x) no less than 80% of the aggregate sale proceeds of each such
sale are in the form of cash and (y) the aggregate sale proceeds from all
assets subject to such sales pursuant to this clause (h), in any fiscal
year shall not exceed 10% of the Consolidated Net Worth of the Borrower as of
the last day of the immediately preceding fiscal year (it being understood and
agreed that, for purposes of this clause (y), the aggregate sale proceeds
from a sale by a Regulated Insurance Company of assets and related liabilities
by way of a Reinsurance Agreement or a Retrocession Agreement shall be deemed
to be the Surplus Increase (if positive) to such Regulated Insurance Company as
a result of such sale), provided, further, that (i) on a pro forma basis (the
pro forma adjustments made by the Borrower pursuant to this clause (i)
shall be subject to the reasonable satisfaction of the Administrative Agent)
determined as if such asset sale had been consummated on the date occurring
twelve months prior to the last day of the most recently ended fiscal quarter
of the Borrower with respect to any asset sale, the Borrower and its
Subsidiaries would have been in compliance with Sections 7.10 through 7.14
of this Agreement as of, or for the relevant period ended on, the last day of
such fiscal quarter and (ii) on a pro forma basis (the pro forma adjustments
made by the Borrower pursuant to this clause (ii) shall be subject to the
reasonable satisfaction of the Administrative Agent) determined as if such
asset sale had been consummated, the covenants contained in Sections 7.10
through 7.14 will continue to be met for the twelve-month period following the
last day of the fiscal quarter ended after the date of the consummation of such
asset sale;

(i)            So long as no Default or Event of Default then
exists or would result therefrom, the Borrower and its Subsidiaries may acquire
(including by means of a merger) assets or the capital stock of any Person (any
such acquisitions permitted by this clause (i), a “Permitted Acquisition”),
provided that (i) such Person (or the assets so acquired) was, immediately
prior to such acquisition, engaged (or used) primarily in the businesses
permitted pursuant to Section 7.01(a), (ii) each such acquisition shall be
for an amount not greater than the fair market value thereof (as determined in
good faith by the Board of Directors of the Borrower), (iii) the only
consideration paid by the Borrower and its Subsidiaries in connection with any
Permitted Acquisition shall be cash, common stock of the Borrower issued in
accordance with Section 7.15(a)(i) and preferred stock of the Borrower
issued in accordance with Section 7.15(a)(ii), (iv) the aggregate amount
of cash expended by the Borrower and its Subsidiaries for Permitted
Acquisitions in any fiscal year shall not exceed 10% of the Consolidated Net
Worth of the Borrower and its Subsidiaries as of the last day of the
immediately preceding fiscal year, (v) the aggregate value of Borrower common
stock and preferred stock issued by the Borrower as consideration for Permitted
Acquisitions (valued in good faith by the Borrower) in any fiscal year shall
not exceed 35% of the Consolidated Net Worth of the Borrower and its
Subsidiaries as of the last day of the immediately preceding fiscal year, (vi)
on a pro forma basis (the pro forma adjustments made by the Borrower pursuant
to this clause (vi) shall be subject to the reasonable satisfaction of the
Administrative Agent) determined as if such acquisition had been consummated on
the date occurring twelve months prior to the last day of the most recently
ended fiscal quarter of the Borrower, the Borrower and its Subsidiaries would
have been in compliance with Sections 7.10 through 7.14 of this Agreement
as of, or for the relevant period ended on, the last day of such fiscal
quarter, (vii) on a pro forma basis (the pro forma adjustments made by the
Borrower pursuant to this clause (vii) shall be subject to the reasonable
satisfaction of the Administrative Agent) determined as if such acquisition had
been

 35
 

consummated, the covenants contained in Sections 7.10
through 7.14 will continue to be met for the twelve-month period following the
last day of the fiscal quarter ended after the date of the consummation of such
acquisition and (viii) no such acquisition shall be consummated on a “hostile”
basis (i.e., without the consent of the Board of Directors of the Person to be
acquired);

(j)            Sales and purchases of assets between one
Regulated Insurance Company and another Regulated Insurance Company; and

(k)           Sales and purchases of assets between one Credit Party and another
Credit Party.

7.03         Liens.  The Borrower will not, and will not permit
any of its Subsidiaries to, create, incur, assume or suffer to exist any Lien
upon or with respect to any property or assets of any kind (real or personal,
tangible or intangible) of the Borrower or any such Subsidiary whether now
owned or hereafter acquired, or sell any such property or assets subject to an
understanding or agreement, contingent or otherwise, to repurchase such
property or assets (including sales of accounts receivable or notes with
recourse to the Borrower or any of its Subsidiaries) or assign any right to
receive income, or file or permit the filing of any financing statement under
the UCC or any other similar notice of Lien under any similar recording or
notice statute relating to any such property, except:

(a)           Liens for taxes and other assessments not yet due or being contested in
good faith and by appropriate proceedings for which adequate reserves (in the
good faith judgment of the management of the Borrower) have been established in
accordance with GAAP or SAP, as may be applicable;

(b)           Liens in respect of property or assets of any of the Borrower’s
Subsidiaries imposed by law which were incurred in the ordinary course of
business, such as carriers’, warehousemen’s and mechanics’ Liens and other
similar Liens arising in the ordinary course of business, and (x) which do not
in the aggregate materially detract from the value of such property or assets
or materially impair the use thereof in the operation of the business of the
Borrower or any Subsidiary or (y) which are being contested in good faith by
appropriate proceedings, which proceedings have the effect of preventing the
forfeiture or sale of the property or asset subject to such Lien;

(c)           Any Liens created by this Agreement or the other Credit Documents or
Liens created pursuant to the Other Credit Agreement;

(d)           Liens in existence on the Effective Date, without giving effect to any
extensions or renewals thereof (provided that the securities subject to any
such Lien may be replaced by other securities of no greater principal amount);

(e)           Liens arising from judgments, decrees or attachments in circumstances
not constituting an Event of Default under Section 8.09;

(f)            Liens (other than any Lien imposed by ERISA)
incurred or deposits made in the ordinary course of business in connection with
workers’ compensation, unemployment insurance and other types of social
security, or to secure the performance of tenders, statutory obligations,
surety and appeal bonds, bids, leases, government contracts, performance and
return-of-money bonds, Reinsurance Agreements, Retrocession Agreements and
other similar obligations incurred in the ordinary course of business
(exclusive of obligations in respect of the payment for borrowed money);

 36
 

(g)           Leases or subleases granted to others not interfering in any material
respect with the business of the Borrower or any of its Subsidiaries and any
interest or title of a lessor under any lease not in violation of this
Agreement;

(h)           Easements, rights-of-way, restrictions, minor defects or irregularities
in title and other similar charges or encumbrances not interfering in any
material respect with the ordinary conduct of the business of the Borrower or
any of its Subsidiaries;

(i)            Liens arising from UCC financing statements
regarding leases not in violation of this Agreement;

(j)            Liens on pledges or deposits of cash or
securities made by any Regulated Insurance Company as a condition to obtaining
or maintaining any licenses issued to it by any Applicable Insurance Regulatory
Authority;

(k)           Liens arising pursuant to purchase money mortgages, Capital Leases or
security interests securing Indebtedness representing the purchase price (or
financing of the purchase price within 90 days after the respective purchase)
of assets acquired after the Initial Borrowing Date, provided that (i) any such
Liens attach only to the assets so purchased, (ii) the Indebtedness secured by
any such Lien does not exceed 100%, nor is less than 80%, of the lesser of the
fair market value or the purchase price of the property being purchased at the
time of the incurrence of such Indebtedness and (iii) the Indebtedness secured
thereby is permitted to be incurred pursuant to Section 7.04(b);

(l)            Liens on property or assets acquired pursuant
to a Permitted Acquisition, or on property or assets of a Subsidiary of the
Borrower in existence at the time such Subsidiary is acquired pursuant to a
Permitted Acquisition, provided that (i) any Indebtedness that is secured by
such Liens is permitted to exist under Section 7.04(g) and (ii) such Liens
are not incurred in connection with or in contemplation or anticipation of such
Permitted Acquisition and do not attach to any other asset of the Borrower or
any of its Subsidiaries; and

(m)          Liens consisting of customary set-off rights or bankers’ liens on
amounts on deposit, whether arising by contract or operation of law, to the
extent incurred in the ordinary course of business.

7.04         Indebtedness.  The Borrower will not, and will not permit
any of its Subsidiaries to, contract, create, incur, assume or suffer to exist
any Indebtedness, except:

(a)           Indebtedness incurred pursuant to this Agreement and the other Credit
Documents and Indebtedness incurred pursuant to the Other Credit Agreement;

(b)           Capitalized Lease Obligations and Indebtedness of the Borrower and its
Subsidiaries incurred pursuant to purchase money Liens permitted under
Section 7.03(k), provided that (x) all such Capitalized Lease Obligations
are permitted under Section 7.05 and (y) the sum of (i) the aggregate
Capitalized Lease Obligations plus (ii) the aggregate principal amount of such
purchase money Indebtedness shall not exceed at any time outstanding an amount
equal to $10,000,000;

(c)           Indebtedness in existence on the Effective Date which is listed on
Schedule 5.20, without giving effect to any subsequent extension, renewal or
refinancing thereof;

 37
 

(d)           Obligations of any Regulated Insurance Company with respect to (i)
letters of credit (other than the Letters of Credit) securing obligations under
Reinsurance Agreements entered into in the ordinary course of business of any
such Regulated Insurance Company, (ii) letters of credit (other than the
Letters of Credit) issued in lieu of deposits to satisfy Legal Requirements or
(iii) letters of credit (other than the Letters of Credit) or surety bonds
issued in lieu of depositing securities with any Applicable Insurance
Regulatory Authority to satisfy regulatory requirements; in any case to the
extent (x) such letters of credit are not drawn upon or, if and to the extent
drawn upon, such drawing is reimbursed no later than 10 days following receipt
by the Borrower or such Subsidiary of notice of payment on such letter of
credit, (y) in the case of clauses (i) and (ii), the aggregate outstanding
amount of such obligations shall not exceed $15,000,000 at any time and (z) in
the case of clause (iii), the aggregate outstanding amount of such obligations
shall not exceed $5,000,000 at any time;

(e)           Indebtedness under Interest Rate Agreements or Other Hedging Agreements
entered into in respect of the Obligations or otherwise in the ordinary course
of its business and not for speculative purposes;

(f)            Indebtedness of American Exchange owing to the
Borrower evidenced by the Surplus Note;

(g)           Indebtedness of the Borrower or a Wholly-Owned Subsidiary of the
Borrower acquired pursuant to a Permitted Acquisition (or Indebtedness assumed
at the time of a Permitted Acquisition of an asset securing such Indebtedness),
and any refinancing of such Indebtedness so long as the principal amount
thereof is not increased, provided that (i) such Indebtedness was not incurred
in connection with or in contemplation of such Permitted Acquisition, (ii) such
Indebtedness does not constitute Indebtedness for borrowed money, it being
understood and agreed that Capitalized Lease Obligations and purchase money
Indebtedness shall not constitute Indebtedness for borrowed money for purposes
of this clause (ii), and (iii) at the time of such Permitted Acquisition,
such Indebtedness does not exceed 10% of the total value of the assets of the
Subsidiary so acquired, or of the assets so acquired, as the case may be;

(h)           Indebtedness of the Borrower or any of its Subsidiaries arising under
letters of credit (other than the Letters of Credit) issued for the account of
any such person in the ordinary course of business; provided that, the
aggregate outstanding amount of such letters of credit shall not exceed
$2,500,000 at any time;

(i)            Indebtedness arising under the Trust Preferred
Securities;

(j)            Indebtedness constituting a loan from (i) any
Regulated Insurance Company to another Regulated Insurance Company, (ii) any
Regulated Insurance Company to the Borrower, (iii) any Subsidiary Guarantor to
another Subsidiary Guarantor, (iv) the Borrower to any Subsidiary Guarantor or
(v) the Borrower or any Subsidiary Guarantor to any Regulated Insurance
Company; and

(k)           Other Indebtedness, including revolving Indebtedness, having terms and
conditions reasonably satisfactory to the Administrative Agent in an aggregate
outstanding principal amount not to exceed $7,500,000 at any time; provided
that, before and after giving effect to the incurrence of such other
Indebtedness, the Borrower is in compliance with Sections 7.10 and 7.13 and
no other Event of Default exists.

 38
 

7.05         Capital Expenditures.

(a)           The Borrower will not incur, and will not permit any of its Subsidiaries
to incur, Capital Expenditures in an amount that exceeds, for the Borrower and
its Subsidiaries on a consolidated basis, (i) $15,000,000 during any fiscal
year, or (ii) $60,000,000 after May 28, 2004.

(b)           Notwithstanding the foregoing, in the event that the amount of Capital
Expenditures permitted to be made by the Borrower and its Subsidiaries pursuant
to clause (a) above in any fiscal year is greater than the amount of such
Capital Expenditures actually made by the Borrower and its Subsidiaries during
such fiscal year (excluding Capital Expenditures made under clause (c)
below), such excess (the “Rollover Amount”) may be carried forward and utilized
to make Capital Expenditures in the immediately succeeding fiscal year.

(c)           In addition to the Capital Expenditures permitted above in this
Section 7.05, the Borrower and its Subsidiaries may make Capital
Expenditures at any time with the net cash proceeds of Asset Sales and with the
net cash proceeds of any equity issuance by the Borrower.

(d)           In addition to the Capital Expenditures permitted above in this
Section 7.05, the Borrower and its Subsidiaries may make Permitted
Acquisitions.

7.06         Advances, Investments and
Loans.  The Borrower will not, and will
not permit any of its Subsidiaries to, lend money or credit or make advances to
any Person, or purchase or acquire any stock, obligations or securities of, or
any other interest in, or make any capital contribution to, any Person, except:

(a)           [Intentionally Omitted];

(b)           The Borrower and its Subsidiaries which are not Regulated Insurance
Companies may invest in cash, Cash Equivalents and Investment Grade Securities
other than investments which are Risk Derivatives (determined at the time of
acquisition); provided that any investment in Investment Grade Securities
(other than U.S. Government Obligations) issued by any single Issuer shall not
exceed on the date such investment is made an amount which, when added to all
other investments by all Regulated Insurance Companies and the Borrower in such
Issuer and outstanding on such date, is equal to 5% of Invested Assets at such
time;

(c)           The Borrower and its Subsidiaries may acquire and hold receivables owing
to them in the ordinary course of business and payable or dischargeable in
accordance with customary trade terms;

(d)           Loans and advances to employees for business-related travel expenses,
moving expenses and other similar expenses, in an aggregate outstanding amount
that does not exceed $2,500,000 at any time, in each case incurred in the
ordinary course of business;

(e)           The transactions described in Section 7.02 shall be permitted;

(f)            Regulated Insurance Companies may invest in
(i) cash, (ii) Cash Equivalents, (iii) Investment Grade Securities and (iv)
Non-Investment Grade Securities; provided that (A) no investment will be made
in (i) any debt securities which are Non-Investment Grade Securities or (ii)
any equity securities, at a time when, or if after giving effect thereto, the
aggregate principal amount of all Non-Investment Grade Securities held by all
Regulated Insurance Companies plus the aggregate outstanding investment made by
all Regulated Insurance Companies in equity securities (other than securities
of Persons which are Affiliates of the Borrower on the Effective

 39
 

Date) equals or exceeds or would equal or
exceed 10% of Invested Assets; (B) no investment will be made in any real
estate or loan secured by real estate (other than (I) credit tenant loans (as
defined by the NAIC on the Effective Date), (II) those existing on the
Effective Date (without giving effect to any increase thereto) and (III) loans
secured by owner-occupied real estate, if made at a time when, and if after
giving effect thereto, the aggregate of all such investments in mortgage loans
does not exceed, and would not exceed, 5% of Invested Assets; and (C) no
investment (other than U.S. Government Obligations) in any single Issuer shall
exceed on the date such investment is made an amount which, when added to all
other investments by the Borrower and its Subsidiaries in the same Issuer and
outstanding on such date, is equal to 5% of Invested Assets at such time;

(g)           Any Regulated Insurance Company may make investments in companies which
are Wholly-Owned Subsidiaries of such Person (or any other Subsidiary of such
Person created or acquired in accordance with Section 7.16) but only to
the extent that any such investment, at the time made, does not reduce Adjusted
Statutory Capital and Surplus of such Regulated Insurance Company;

(h)           Investments pursuant to commitments in effect as of the Effective Date
and described (as to matter and amount) on Schedule 7.06;

(i)            Investments acquired by the Borrower or any of
its Subsidiaries (x) in exchange for any other investment held by the Borrower
or any such Subsidiary in connection with or as a result of a bankruptcy,
workout, reorganization or recapitalization of the issuer of such other
investment, (y) as a result of a foreclosure by the Borrower or any of its
Subsidiaries with respect to any secured investment or other transfer of title
with respect to any secured investment in default or (z) in settlement of
delinquent obligations of, and other disputes with, customers and suppliers
arising in the ordinary course of business;

(j)            Investments existing on the Effective Date
which are identified on Schedule 7.06;

(k)           The Borrower may acquire and hold obligations of one or more agents,
officers or employees of the Borrower or its Subsidiaries in connection with
such agents’, officers’ or employees’ acquisition of shares of capital stock of
the Borrower or options to purchase shares of capital stock of the Borrower
(other than obligations that would be in violation of Section 402 of the
United States Sarbanes-Oxley Act of 2002) so long as no cash is paid by the
Borrower or any of its Subsidiaries in connection with the acquisition of any
such obligations and such obligations do not exceed $2,500,000 in aggregate principal
amount outstanding at any time;

(l)            Investments consisting of intercompany loans
to the extent permitted under Section 7.04(j);

(m)          Investments by the Borrower in Subsidiary Guarantors, and investments by
Subsidiary Guarantors in other Subsidiary Guarantors;

(n)           Investments by the Borrower and Subsidiary Guarantors in Regulated
Insurance Companies;

(o)           Investments consisting of prepaid expenses;

(p)           Investments consisting of advances made by the Borrower and its
Subsidiaries to agents, which advances are either (i) repayable and repaid
within one year from the date of the

 40
 

making of such advance or (ii) repayable
within a time period longer than one year from the date of the making of such
advance, provided that the aggregate outstanding amount of advances under this
clause (ii) shall not exceed $1,000,000 at any time;

(q)           Investments consisting of non-cash consideration received in connection
with a sale of assets pursuant to Section 7.02(h); and

(r)            Investments not otherwise permitted hereby;
provided, however, that the aggregate outstanding amount of all such
Investments shall not exceed $5,000,000 at any time.

7.07         Modifications of
Agreements, etc.  The Borrower will not,
and will not permit any of its Subsidiaries to:

(a)           Amend, modify or change in any manner materially adverse to the
interests of the Banks the Organizational Documents (including, without
limitation, by the filing of any certificate of designation) of the Borrower or
any of its Subsidiaries, or any other agreement entered into by the Borrower or
any of its Subsidiaries with respect to its capital stock, or enter into any
new agreement with respect to the capital stock of the Borrower (to the extent
adverse to the interests of the Banks) or any of its Subsidiaries; and/or

(b)           Amend, modify or terminate (or permit the amendment, modification or
termination of) in any manner materially adverse to the interests of the
Borrower and its Subsidiaries or the Banks, the Tax Sharing Agreements.

7.08         Dividends, Restricted Payments, etc.

(a)           The Borrower will not, and will not permit any of its Subsidiaries to,
declare or pay any dividends (other than dividends payable solely in common
stock of such Person) or return any capital to, its stockholders or authorize
or make any other distribution, payment or delivery of property or cash to its
stockholders as such, or prepay, redeem, retire, purchase, defease or otherwise
acquire, directly or indirectly, for a consideration, any shares of any class
of its capital stock (the Trust Preferred Securities being deemed to be capital
stock for the purpose of this Section 7.08) now or hereafter outstanding
(or any warrants for or options or stock appreciation rights in respect of any
of such shares), or set aside any funds for any of the foregoing purposes, or
purchase or otherwise acquire or permit any of its Subsidiaries to purchase or
otherwise acquire for consideration any shares of any class of the capital
stock (the Trust Preferred Securities being deemed to be capital stock for the
purpose of this Section 7.08) of the Borrower or any of its Subsidiaries,
as the case may be, now or hereafter outstanding (or any options or warrants or
stock appreciation rights issued by such Person with respect to its capital
stock), except that:

(i)            Any Subsidiary of the Borrower may pay cash
dividends to its parent if such parent is the Borrower or a Wholly-Owned
Subsidiary of the Borrower;

(ii)           So long as no Event of Default has occurred and is continuing or results
therefrom, the Borrower may redeem or purchase its capital stock (including
capital stock held by officers and employees of the Borrower or any of its
Subsidiaries but excluding the Trust Preferred Securities and excluding capital
stock redeemed or purchased pursuant to clause (iii) below) (A) solely
with the cash proceeds of capital stock issued by the Borrower or any of its
Subsidiaries after the Initial Borrowing Date, and (B) other than with the cash
proceeds of capital stock issued by the Borrower or any of its

 41

Subsidiaries after the Initial Borrowing Date,
in an amount not exceeding $30,000,000 in the aggregate after January 1,
2006.

(iii)          So long as no Event of Default has occurred and is continuing or results
therefrom, the Borrower may redeem or purchase its capital stock in an
aggregate amount not to exceed $1,000,000 in any fiscal year for the purpose of
awarding stock compensation to its officers and employees;

(iv)          So long as no Event of Default (under Section 8.01 or under
Section 8.03 as a result of the default by any Credit Party in the due
performance or observance by it of Section 7.10, 7.11, 7.12, 7.13 or 7.14)
has occurred and is continuing at the time of the payment thereof, regularly
accruing interest and dividends on the Trust Preferred Securities may be paid
in cash; and

(v)           The Borrower may pay regularly accruing dividends on preferred stock
issued in accordance with Section 7.15(a) through the issuance of
additional shares of such preferred stock, or by accrual or accretion, but not
in cash.

(b)           The Borrower will not, and will not permit any of its Subsidiaries to,
create or otherwise cause or suffer to exist any encumbrance or restriction
which prohibits or otherwise restricts (i) the ability of any Subsidiary to (A)
pay dividends or make other distributions or pay any Indebtedness owed to the
Borrower or any of its Subsidiaries, as applicable, (B) make loans or advances
to the Borrower or any Subsidiary, as applicable, (C) transfer any of its
properties or assets to the Borrower or any Subsidiary, as applicable, or (D)
guarantee the Obligations or (ii) the ability of the Borrower or any Subsidiary
of the Borrower to create, incur, assume or suffer to exist any Lien upon its
property or assets to secure the Obligations, other than prohibitions or restrictions
existing under or by reason of (I) this Agreement and the other Credit
Documents and the Other Credit Agreement and the other Credit Documents (as
defined in the Other Credit Agreement) and (II) Legal Requirements.

7.09         Transactions with Affiliates.  The Borrower will not, and will not permit
any Subsidiary to, enter into any transaction or series of transactions with
any Affiliate (excluding the Borrower or any Wholly-Owned Subsidiary of the
Borrower) other than in accordance with applicable Legal Requirements and on
terms and conditions substantially as favorable to the Borrower or such
Subsidiary as would be obtainable by the Borrower or such Subsidiary at the
time in a comparable arm’s-length transaction with a Person other than an
Affiliate.

7.10         Leverage Ratio.  The Borrower will not permit the ratio of (i)
Consolidated Indebtedness of the Borrower to (ii) Consolidated Total Capital of
the Borrower as of the end of any fiscal quarter set forth below to be greater
than the ratio set forth opposite such fiscal quarter:

	
  Fiscal Quarter

  	
   

  	
  Ratio

  
	
  December 31,
  2006

  	
   

  	
  0.35:1.00

  
	
  March 31,
  2007 and thereafter

  	
   

  	
  0.30:1.00

  

 

7.11         Fixed Charge Coverage
Ratio.  The Borrower will not permit the
Fixed Charge Coverage Ratio as of the end of any fiscal quarter ending on or
after December 31, 2006 and for the four fiscal quarters then ended to be
less than 1.50:1.00.

 42
 

7.12         Minimum Risk Based
Capital.  The Borrower will not permit
the Risk Based Capital Ratio for any Regulated Insurance Company as of the end
of any fiscal year ending on or after December 31, 2006 to be less than
150%.

7.13         Minimum Consolidated Net
Worth.  The Borrower will not permit its
Consolidated Net Worth at any time to be less than the sum of (i) $260,000,000
plus (ii) an amount equal to 50% of the Borrower’s Consolidated Net Income for
each fiscal quarter ending after May 28, 2004 (without deduction for any
fiscal quarter in which the Borrower’s Consolidated Net Income is negative).

7.14         Minimum Combined Adjusted Statutory Capital
and Surplus.  The Borrower will not
permit the Adjusted Statutory Capital and Surplus of the Regulated Insurance
Companies which are Domestic Subsidiaries of the Borrower (determined on a
Combined basis) at any time to be less than an amount equal to 85% of the
Adjusted Statutory Capital and Surplus of such Regulated Insurance Companies as
of March 31, 2004.

7.15         Issuance of Stock.

(a)           The Borrower will not directly or indirectly issue, sell, assign,
pledge, or otherwise encumber or dispose of any shares of its capital stock or
other equity securities (or warrants, rights or options to acquire shares or
other equity securities), except (i) the issuance of common stock (and
warrants, options and other rights to acquire common stock), so long as no
Change of Control has occurred or results therefrom, and (ii) the issuance of
preferred stock, so long as (x) no part of such preferred stock is mandatorily
redeemable (whether on a scheduled basis or as a result of the occurrence of
any event or circumstance) and (y) any dividends associated with such preferred
stock are solely payable in kind.

(b)           The Borrower will not permit any of its Subsidiaries directly or
indirectly to issue, sell, assign, pledge, or otherwise encumber or dispose of
any shares of its capital stock or other equity securities (or warrants, rights
or options to acquire shares or other equity securities) of such Subsidiary,
except (i) to the Borrower or to a Wholly-Owned Subsidiary of the Borrower,
(ii) to qualify directors if required by applicable law, (iii) capital stock
issued as part of the issuance of the Trust Preferred Securities, or (iv)
pursuant to the Other Credit Agreement.

7.16         Creation of
Subsidiaries.  The Borrower shall not
create or acquire any Subsidiary other than (i) Regulated Insurance Companies
which are direct or indirect Subsidiaries of the Borrower, so long as all of
the capital stock of any direct Subsidiary or indirect Subsidiary that is
Wholly-Owned by a Non-Regulated Company (in each case, if a Domestic Subsidiary)
and 65% of the capital stock of any direct Subsidiary (if a Foreign Subsidiary)
is pledged pursuant to the Other Credit Agreement; (ii) Non-Regulated Companies
which are direct or indirect Subsidiaries of the Borrower and are not
Subsidiaries of any Regulated Insurance Company, so long as (x) all of the
capital stock of any such Subsidiary (if a Domestic Subsidiary) and 65% of the
capital stock of any direct Subsidiary (if a Foreign Subsidiary) is pledged
pursuant to the Other Credit Agreement, (y) all of the assets of any such
Subsidiary (if a Domestic Subsidiary) are pledged pursuant to the Other Credit
Agreement and (z) any such Subsidiary (if a Domestic Subsidiary) executes the
Subsidiary Guaranty and (iii) Non-Regulated Companies (other than any
Non-Regulated Company described in clause (ii) preceding) which are created or
acquired solely for the purpose of issuing the Trust Preferred Securities,
engage in no other business and have no assets other than assets acquired in
connection with the issuance of the Trust Preferred Securities.  In addition, at the request of the
Administrative Agent, each new Subsidiary that is required to execute any
Credit Document shall execute and deliver, or cause to be executed and
delivered, all other relevant documentation of the type described in
Section 4 as such new Subsidiary would have had to deliver if such new
Subsidiary were a Credit Party on the Initial Borrowing Date.  For purposes of this

 43
 

Section 7.16, the
Borrower shall be deemed to have created or acquired an Initially Excluded
Subsidiary if and at the time that such Initially Excluded Subsidiary has or
acquires assets having a book value of $250,000 or more.

7.17         Partnership
Agreements.  The Borrower will not enter
into any partnership agreement as a general partner.

Notwithstanding
anything contained herein that may be to the contrary, the Banks and the Administrative Agent (a) consent to and
waive the matters for which a consent and waiver was given pursuant to that
certain Waiver and Third Amendment dated as of November 29, 2006 to the
Other Credit Agreement, and (b) agree that the consummation of such matters
shall not constitute a Default or Event of Default under this Agreement.

SECTION 8.           Events of Default.  Upon the occurrence of any of the following
specified events (each an “Event of Default”):

8.01         Payments.  The Borrower shall (i) default in the payment
when due of any principal of any Loan or any L/C Obligation, (ii) default, and
such default shall continue for five or more days, in the payment when due of
any interest on any Loan or on any L/C Obligation, or any Fees or (iii) default
in the prompt payment following notice or demand in respect of any other
amounts owing hereunder or under any other Credit Document; or

8.02         Representations, etc.  Any representation, warranty or statement
made or deemed made by the Borrower or any other Credit Party herein or in any
other Credit Document or in any statement or certificate delivered or required
to be delivered pursuant hereto or thereto shall prove to be untrue in any
material respect on the date as of which made or deemed made; or

8.03         Covenants.  Any Credit Party shall (a) default in the due
performance or observance by it of any term, covenant or agreement contained in
Section 6.10 or 7, or (b) default in the due performance or observance by
it of any term, covenant or agreement (other than those referred to in
Section 8.01 or clause (a) of this Section 8.03) contained in
this Agreement and such default shall continue unremedied for a period of at
least 30 days; or

8.04         Default Under Other
Agreements.  (a) The Borrower or any of
its Subsidiaries shall (i) default in any payment with respect to Indebtedness
(other than the Obligations but including Indebtedness incurred pursuant to the
Other Credit Agreement) having a principal balance in excess of $3,000,000
individually or in the aggregate, beyond the period of grace, if any, provided
in the instrument or agreement under which such Indebtedness was created or
(ii) default in the observance or performance of any agreement or condition
relating to any such Indebtedness or contained in any instrument or agreement
evidencing, securing or relating thereto, or any other event shall occur or
condition exist, the effect of which default or other event or condition is to
cause, or to permit the holder or holders of such Indebtedness (or a trustee or
agent on behalf of such holder or holders) to cause any such Indebtedness to
become due prior to its stated maturity; or (b) any such Indebtedness of the
Borrower or any of its Subsidiaries shall be declared to be due and payable, or
required to be prepaid other than by a regularly scheduled required prepayment,
prior to the stated maturity thereof; or

8.05         Bankruptcy, etc.  The Borrower or any of its Subsidiaries shall
commence a voluntary case concerning itself under Title 11 of the United States
Code entitled “Bankruptcy,” as now or hereafter in effect, or any successor
thereto (the “Bankruptcy Code”); or an involuntary case is commenced against
the Borrower or any of its Subsidiaries and the petition is not controverted
within 10 days, or is not dismissed within 60 days, after commencement of the
case; or a custodian (as defined in the Bankruptcy

 44
 

Code) is appointed for,
or takes charge of, all or substantially all of the property of the Borrower or
any of its Subsidiaries; or the Borrower or any of its Subsidiaries commences
(including by way of applying for or consenting to the appointment of, or the
taking of possession by, a rehabilitator, receiver, custodian, trustee,
conservator or liquidator (collectively, a “conservator”) of itself or all or
any substantial portion of its property) any other proceeding under any
reorganization, arrangement, adjustment of debt, relief of debtors,
dissolution, insolvency, liquidation, rehabilitation, conservatorship or
similar law of any jurisdiction whether now or hereafter in effect relating to
the Borrower or any of its Subsidiaries; or any such proceeding is commenced
against the Borrower or any of its Subsidiaries and remains undismissed for a
period of 60 days; or the Borrower or any of its Subsidiaries is adjudicated
insolvent or bankrupt; or any order of relief or other order approving any such
case or proceeding is entered; or (a) any Regulated Insurance Company which is
engaged in the business of underwriting insurance and/or reinsurance in the
United States suffers any appointment of any conservator or the like for it or
any substantial part of its property, or (b) the Borrower or any of its
Subsidiaries (other than any Regulated Insurance Company described in the
immediately preceding clause (a)) suffers any appointment of any
conservator or the like for it or any substantial part of its property which
continues undischarged or unstayed for a period of 60 days; or the Borrower or
any of its Subsidiaries makes a general assignment for the benefit of
creditors; or any corporate action is taken by the Borrower or any of its
Subsidiaries for the purpose of effecting any of the foregoing; or

8.06         ERISA.  (a) Any Plan shall fail to satisfy the
minimum funding standard required for any plan year or part thereof under
Section 412 of the Code or Section 302 of ERISA or a waiver of such
standard or extension of any amortization period is sought or granted under
Section 412 of the Code or Section 303 or 304 of ERISA, a Reportable
Event shall have occurred, any Plan which is subject to Title IV of ERISA shall
have had or is likely to have a trustee appointed by the PBGC to administer
such Plan, any Plan which is subject to Title IV of ERISA is, shall have been
or is likely to be terminated or to be the subject of termination proceedings
under ERISA, any Plan shall have an Unfunded Current Liability, a contribution
required to be made with respect to a Plan has not been timely made, the
Borrower or any Subsidiary of the Borrower or any ERISA Affiliate has incurred
any liability to or on account of a Plan under Section 409, 502(i),
502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or
Section 401(a)(29), 4971 or 4975 of the Code or on account of a group
health plan (as defined in Section 607(1) of ERISA or
Section 4980B(g)(2) of the Code) under Section 4980B of the Code, or
the Borrower or any Subsidiary of the Borrower has incurred or is likely to
incur liabilities (other than as disclosed on Schedule 5.14) pursuant to one or
more employee welfare benefit plans (as defined in Section 3(1) of ERISA)
that provide death, health or severance benefits to retired employees or other
former employees (other than as required by Section 601 of ERISA or
applicable state law) or Plans; (b) there shall result from any such event or
events the imposition of a lien, the granting of a security interest, or a
liability and (c) such lien, security interest or liability, individually or in
the aggregate, has had, or could reasonably be expected to have, a Material
Adverse Effect; or

8.07         Invalidity of Credit
Documents.  Any Credit Document, at any
time after its execution and delivery and for any reason other than as
expressly permitted hereunder or satisfaction in full of all the Obligations,
ceases to be in full force and effect; or any Credit Party or any other Person
contests in any manner the validity or enforceability of any Credit Document;
or any Credit Party denies that it has any or further liability or obligation
under any Credit Document, or purports to revoke, terminate or rescind any
Credit Document; or

8.08         [Intentionally Omitted]; or

8.09         Judgments.  One or more judgments or decrees shall be
entered against the Borrower or any of its Subsidiaries involving a liability,
net of undisputed reinsurance, of $5,000,000 or more in the case of any one
such judgment or decree or in the aggregate for all such judgments and decrees
for the

 45
 

Borrower and its
Subsidiaries and any such judgments or decrees shall not have been vacated,
discharged, stayed or bonded pending appeal within 60 days from the entry
thereof.

8.10         Remedies Upon Event of
Default.  If any Event of Default occurs
and is continuing, the Administrative Agent shall, at the request of, or may,
with the consent of, the Required Banks, take any or all of the following
actions:

(a)           Declare
the commitment of each Bank to make Loans and any obligation of the L/C Issuer
to make L/C Credit Extensions to be terminated, whereupon such commitments and
obligation shall be terminated;

(b)           Declare
the unpaid principal amount of all outstanding Loans, all interest accrued and
unpaid thereon, and all other amounts owing or payable hereunder or under any
other Credit Document to be immediately due and payable, without presentment,
demand, protest or other notice of any kind, all of which are hereby expressly
waived by the Borrower;

(c)           Require
that the Borrower Cash Collateralize the L/C Obligations (in an amount equal to
the then Outstanding Amount thereof); and

(d)           Exercise
on behalf of itself and the Banks all rights and remedies available to it and
the Banks under the Credit Documents or applicable law;

provided, however, if an
Event of Default specified in Section 8.05 shall occur with respect to the
Borrower, the obligation of each Bank to make Loans and any obligation of the
L/C Issuer to make L/C Credit Extensions shall automatically terminate, the
unpaid principal amount of all outstanding Loans and all interest and other
amounts as aforesaid shall automatically become due and payable, and the
obligation of the Borrower to Cash Collateralize the L/C Obligations as
aforesaid shall automatically become effective, in each case without further
act of the Administrative Agent or any Bank.

8.11         Application of
Funds.  After the exercise of remedies
provided for in Section 8.10 (or after the L/C Obligations have
automatically been required to be Cash Collateralized as set forth in the
proviso to Section 8.10), any amounts received on account of the Obligations
shall be applied by the Administrative Agent in the following order:

(a)           To
payment of that portion of the Obligations constituting Fees, indemnities,
expenses and other amounts (including Attorney Costs and amounts payable under
Sections 1.11, 1.12 and 3.05) payable to the Administrative Agent in its
capacity as such;

(b)           To
payment of that portion of the Obligations constituting Fees, indemnities and
other amounts (other than principal and interest) payable to the Banks
(including Attorney Costs and amounts payable under Sections 1.11, 1.12,
and 3.05), ratably among them in proportion to the amounts described in this
clause (b) payable to them;

(c)           To
payment of that portion of the Obligations constituting accrued and unpaid
interest on the Loans and L/C Borrowings, ratably among the Banks in proportion
to the respective amounts described in this clause (c) payable to them;

(d)           To
payment of that portion of the Obligations constituting unpaid principal of the
Loans and L/C Borrowings, ratably among the Banks in proportion to the
respective amounts described in this clause (d) held by them;

 46
 

(e)           To
the Administrative Agent for the account of the L/C Issuer, to Cash
Collateralize that portion of L/C Obligations comprised of the aggregate
undrawn amount of Letters of Credit; and

(f)            The
balance, if any, after all of the Obligations have been indefeasibly paid in
full, to the Borrower or as otherwise required by law.

Subject to
Section 1.07(c), amounts used to Cash Collateralize the aggregate undrawn amount
of Letters of Credit pursuant to clause (e) above shall be applied to
satisfy drawings under such Letters of Credit as they occur.  If any amount remains on deposit as Cash
Collateral after all Letters of Credit have either been fully drawn or expired,
such remaining amount shall be applied to the other Obligations, if any, in the
order set forth above.

SECTION 9.           Definitions.  As used herein, the following terms shall
have the meanings herein specified unless the context otherwise requires.
Defined terms in this Agreement shall include in the singular number the plural
and in the plural the singular:

“Adjusted
Statutory Capital and Surplus” shall mean, at any date for any Regulated
Insurance Company, the total amount as would be shown on line 38, page 3,
column 1 of a Benchmark Statement for such Regulated Insurance Company prepared
as of such date; provided that such total amount shall include asset valuation
reserves as would be shown on line 24.1, page 3, column 1 of a Benchmark
Statement for such Regulated Insurance Company.

“Administrative
Agent” shall have the meaning provided in the first paragraph of this Agreement
and shall include any successor to the Administrative Agent appointed pursuant
to Section 10.09.

“Affiliate” shall
mean, with respect to any Person, any other Person directly or indirectly
controlling (including but not limited to all directors and officers of such
Person), controlled by, or under direct or indirect common control with, such
Person. A Person shall be deemed to control a corporation if such Person
possesses, directly or indirectly, the power (i) to vote 10% or more of the
securities having ordinary voting power for the election of directors of such
corporation or (ii) to direct or cause the direction of the management and
policies of such corporation, whether through the ownership of voting
securities, by contract or otherwise.

“Agent-Related
Persons” shall mean the Administrative Agent, together with their Affiliates
(including, in the case of Bank of America in its capacity as the
Administrative Agent, the Arranger), and the officers, directors, employees,
agents and attorneys-in-fact of such Persons and Affiliates.

“Agreement” shall
mean this Credit Agreement, as the same may be from time to time modified,
amended and/or supplemented.

“American Exchange”
shall mean American Exchange Life Insurance Company, a Texas corporation.

“Annual Statement”
shall mean the annual financial statement required to be filed by any Regulated
Insurance Company with the Applicable Insurance Regulatory Authority.

“Applicable
Insurance Regulatory Authority” shall mean, when used with respect to any
Regulated Insurance Company, the insurance department or similar administrative
authority or agency located in (x) each state or other jurisdiction in which
such Regulated Insurance Company is domiciled or (y) to the extent asserting
regulatory jurisdiction over such Regulated Insurance Company, the insurance

 47
 

department, authority or
agency in each state or other jurisdiction in which such Regulated Insurance
Company is licensed, and shall include any Federal or national insurance
regulatory department, authority or agency that may be created and that asserts
regulatory jurisdiction over such Regulated Insurance Company.

“Applicable
Percentage” shall mean, on any date of determination, the percentages per annum
set forth in the table below for the Type of Borrowing under the Revolving
Credit Facility, Letters of Credit or Commitment Fee (as the case may be), that
corresponds to the Debt Rating as set forth below:

Applicable Percentage

	
  Debt Rating

  	
   

  	
  Commitment Fee

  	
   

  	
  Eurodollar Rate +

  Letters of Credit

  	
   

  	
  Base Rate +

  	
   

  
	
  3BBB+

  	
   

  	
  .090

  	
  %

  	
  .500

  	
  %

  	
  0

  	
  %

  
	
  BBB

  	
   

  	
  .110

  	
  %

  	
  .625

  	
  %

  	
  0

  	
  %

  
	
  BBB-

  	
   

  	
  .125

  	
  %

  	
  .750

  	
  %

  	
  0

  	
  %

  
	
  BB+

  	
   

  	
  .150

  	
  %

  	
  .875

  	
  %

  	
  0

  	
  %

  
	
  <BB+

  	
   

  	
  .175

  	
  %

  	
  1.000

  	
  %

  	
  0

  	
  %

  

 

“Debt Rating” shall mean,
as of any date of determination, the rating as determined by S&P of the
Indebtedness incurred pursuant to the Other Credit Agreement; provided that if
such Indebtedness is for any reason not rated by S&P, the Debt Rating shall
be deemed to be below BB+.

“Approved Bank”
shall have the meaning provided in the definition of “Cash Equivalents.”

“Approved Company”
shall have the meaning provided in the definition of “Cash Equivalents.”

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

“Arranger” shall
mean Banc of America Securities LLC and its successors and assigns in its
capacity as “Sole Lead Arranger and Book
Manager.”

“Asset Sale” shall
mean any sale, transfer or other disposition effected on or after the Effective
Date by the Borrower or any of its Subsidiaries of (i) any capital stock or
equity securities of a Subsidiary of the Borrower or (ii) any other asset, in
each case to any Person other than the Borrower or any of its Wholly-Owned
Subsidiaries (other than sales, transfers or other dispositions in the ordinary
course of business).

“Assignment and
Assumption Agreement” shall have the meaning provided in Section 11.04(b).

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

“Authorized
Officer” shall mean, as to any Person, any senior officer of such Person
designated as such in writing by such Person to, and reasonably acceptable to,
the Administrative Agent.

“Bank” shall have
the meaning provided in the first paragraph of this Agreement.

 48
 

“Bank Default”
shall mean (i) the refusal (which has not been retracted) of a Bank to make
available its portion of any Borrowing or L/C Advance or (ii) a Bank having
notified the Administrative Agent and the Borrower that it does not intend to
comply with its obligations under Section 1.01, in the case of either
clause (i) or (ii) above as a result of the appointment of a receiver or
conservator with respect to such Bank at the direction or request of any
regulatory agency or authority.

“Bank of America”
shall mean Bank of America, N.A. and its successors.

“Bankruptcy Code”
shall have the meaning provided in Section 8.05.

“Base Rate” shall
mean for any day a fluctuating rate per annum equal to the higher of (a) the
Federal Funds Rate plus 0.5% and (b) the rate of interest in effect for such
day as publicly announced from time to time by Bank of America as its “prime
rate.”  The “prime rate” is a rate set by
Bank of America based upon various factors including Bank of America’s costs
and desired return, general economic conditions and other factors, and is used
as a reference point for pricing some loans, which may be priced at, above, or
below such announced rate.  Any change in
such rate announced by Bank of America shall take effect at the opening of
business on the day specified in the public announcement of such change.

“Base Rate Loan”
shall mean each Loan bearing interest at the rates provided in
Section 1.09(a).

“Benchmark
Statement” shall mean, as of any date, an annual financial statement of the
Regulated Insurance Companies as would be prepared as of such date utilizing
the identical format utilized by American Exchange in preparing its
December 31, 2005 Annual Statement filed with the Insurance Department of
the State of Texas, with each page, line item and column of a Benchmark Statement
to contain substantially the same type of information, computed in
substantially the same manner, as contained in the identically numbered page,
line item and column of such Annual Statement.

“Borrower” shall
have the meaning provided in the first paragraph of this Agreement.

“Borrower Cash Flow”
shall mean, for any fiscal quarter period, the sum, without duplication, of (i)
the Quarterly Adjusted Dividend Capacity for such period plus (ii) whether
positive or negative, tax sharing payments made by the Regulated Insurance
Companies to the Borrower or American Exchange during such period (less cash
taxes paid by the Borrower or American Exchange during such period), plus (iii)
the combined interest income of the Borrower and American Exchange on an
unconsolidated basis during such period, plus (iv) the TPA EBITDA for such
period, plus (v) the MSO EBITDA for such period minus (vi) the combined cash
selling, general and administrative expenses of the Borrower and American
Exchange on an unconsolidated basis during such period.

“Borrowing” shall
mean the incurrence by the Borrower of one Type of Loan pursuant to the
Facility from all of the Banks, on a pro rata basis on a given date (or
resulting from conversions on a given date), having in the case of Eurodollar
Loans the same Interest Period, provided that Base Rate Loans incurred pursuant
to Section 1.11(b) shall be considered part of any related Borrowing of
Eurodollar Loans.

“Business Day”
shall mean (i) for all purposes other than as covered by clause (ii)
below, any day, excluding Saturday, Sunday and any day which shall be in the
City of New York a legal holiday or a day on which banking institutions are
authorized by law or other governmental actions to close, and (ii) with respect
to all notices and determinations in connection with, and payments of principal
and interest on, Eurodollar Loans, any day which is a Business Day described in
clause (i) and which is also a day for trading by and between banks in
Dollar deposits in the London interbank market.

 49
 

“Capital
Expenditures” shall mean expenditures (whether paid in cash or accrued as
liabilities and including in all events all amounts expended or capitalized
under Capital Leases but excluding any amount representing capitalized
interest) by the Borrower and its Subsidiaries that, in conformity with GAAP,
are or are required to be included in the property, plant or equipment
reflected in the consolidated balance sheet of the Borrower and its
Subsidiaries, provided that Capital Expenditures shall in any event include the
purchase price paid in connection with the acquisition of any Person (including
through the purchase of all of the capital stock or other ownership interests
of such Person or through merger or consolidation) to the extent allocable to
property, plant and equipment.

“Capital Lease” as
applied to any Person, shall mean any lease of any property (whether real,
personal or mixed) by that Person as lessee which, in conformity with GAAP, is,
or is required to be, accounted for as a capital lease on the balance sheet of
that Person.

“Capitalized Lease
Obligations” shall mean all obligations under Capital Leases of the Borrower or
any of its Subsidiaries in each case taken at the amount thereof accounted for
as liabilities in accordance with GAAP.

“Capital Z” shall
mean Capital Z Financial Services Fund II, L.P. and Capital Z Financial
Services Private Fund II, L.P., each a Bermuda limited partnership.

“Cash
Collateralize” shall mean to pledge and deposit with or deliver to the
Administrative Agent, for the benefit of the L/C Issuer and/or the Banks (as
appropriate), as collateral for the L/C Obligations or the prepayment
obligations as provided for in Sections 1.07(g) and 3.03(i)(e), cash or
deposit account balances pursuant to documentation in form and substance
reasonably satisfactory to the Administrative Agent, which documents are hereby
consented to by the Banks.  Derivatives
of such term have corresponding meanings. 
Cash Collateral shall be maintained in interest bearing blocked deposit
accounts at Bank of America bearing interest at a rate generally offered by
Bank of America on such accounts.

“Cash Equivalents”
shall mean (i) securities issued or directly and fully guaranteed or insured by
the United States of America or any agency or instrumentality thereof (provided
that the full faith and credit of the United States of America is pledged in
support thereof) having maturities of not more than one year from the date of
acquisition, (ii) Dollar denominated time deposits, certificates of deposit and
bankers acceptances of (x) any FDIC insured bank, in amounts up to the FDIC
insured limit, (y) any Bank having capital and surplus in excess of
$500,000,000 or the Dollar equivalent thereof or (z) any bank whose short-term
commercial paper rating from S&P is at least A-1 or the equivalent thereof
or from Moody’s is at least P-1 or the equivalent thereof (any such bank, an “Approved
Bank”), in each case with maturities of not more than one year from the date of
acquisition, (iii) commercial paper issued by any Bank or Approved Bank or by
the parent company of any Bank or Approved Bank and commercial paper issued by,
or guaranteed by, any industrial or financial company with a short-term
commercial paper rating of at least A-2 or the equivalent thereof by S&P or
at least P-2 or the equivalent thereof by Moody’s (any such company, an “Approved
Company”), or guaranteed by any industrial company with a long term unsecured
debt rating of at least A or A2, or the equivalent of each thereof, from
S&P or Moody’s, as the case may be, and in each case maturing within six
months after the date of acquisition, provided, however, that commercial paper
rated A-2 or the equivalent thereof by S&P or P-2 or the equivalent thereof
by Moody’s and held by the Borrower and all Regulated Insurance Companies under
this clause (iii) shall not exceed (x) for any Issuer, 1% of Invested
Assets, and (y) in the aggregate, 3% of Invested Assets, (iv) commercial paper
of any United States municipal, state or local government rated at least A-1 or
the equivalent thereof by S&P or at least P-1 or the equivalent thereof by
Moody’s and maturing within one year after the date of acquisition, (v) any
fund or funds investing solely in

 50
 

investments of the type
described in clauses (i) through (iv) above, and (vi) agreements to sell and
repurchase direct obligations of, or obligations that are fully guaranteed as
to principal and interest by, the U.S. Treasury, such agreements to be with
primary treasury dealers, to be evidenced by standard industry forms and to
have maturities of not more than six months from the date of commencement of
the repurchase transaction.

“Cash Proceeds”
shall mean, with respect to any Asset Sale, the aggregate cash payments
(including any cash received by way of deferred payment pursuant to a note
receivable issued in connection with such Asset Sale, other than the portion of
such deferred payment constituting interest, but only as and when received)
received by the Borrower and/or any Subsidiary from such Asset Sale, provided that
any such proceeds received in currency other than Dollars shall be converted
into Dollars at the spot exchange rate for the currency in question on the date
of receipt by the Borrower and/or its Subsidiaries of such proceeds.

“Change of Control”
shall mean (a) Capital Z and its Affiliates collectively shall cease to own
directly or indirectly at least 25% of the Borrower’s capital stock on a fully
diluted basis; (b) Capital Z and its Affiliates collectively shall cease to own
directly or indirectly an amount of the economic and voting interest in the
Borrower’s capital stock equal to at least 51% of the amount of the economic
and voting interest in the Borrower’s capital stock that was owned by Capital Z
and its Affiliates collectively as of the Initial Borrowing Date; (c) the
Borrower shall cease to own directly or indirectly (other than as a result of a
transaction permitted under Section 7.02(d) hereof) 100% of the capital
stock of each of its Subsidiaries; (d) any Person (together with its affiliates)
shall own directly or indirectly, on a fully diluted basis, more of the
economic and voting interest in the capital stock of the Borrower than that
owned by Capital Z and its Affiliates (collectively); or (e) a majority of the
Board of Directors of the Borrower shall cease to consist of Continuing
Directors.

“Code” shall mean the
Internal Revenue Code of 1986, as amended from time to time, and the
regulations promulgated and rulings issued thereunder. Section references
to the Code are to the Code, as in effect at the date of this Agreement and any
subsequent provisions of the Code, amendatory thereof, supplemental thereto or
substituted therefor.

“Combined” shall
mean, when used with reference to any amount or financial statement, such
amount as determined, or financial statement as prepared, on a combined basis
for all of the specified Persons and their respective Subsidiaries; provided
that any such amount or financial statement determined or prepared for any
specified Person and its Subsidiaries separately shall be determined or
prepared on a consolidated basis in accordance with GAAP or SAP, as the case
may be.

“Commitment” shall
mean, with respect to each Bank, such Bank’s Revolving Loan Commitment.

“Commitment Fee”
shall have the meaning provided in Section 2.01(a).

“Company Action
Level” shall mean “Company Action Level” as defined by the NAIC from time to
time and as applied in the context of the Risk Based Capital Guidelines
promulgated by the NAIC (or any term substituted therefor by the NAIC).

“Compliance
Certificate” shall mean a certificate substantially in the form of Exhibit G
hereto.

“Consolidated
Indebtedness” shall mean, at any time and as to any Person, the aggregate
outstanding principal amount of all Indebtedness for borrowed money of such
Person and its Subsidiaries at such time determined on a consolidated basis in
accordance with GAAP; provided that, in any event,

 51
 

the Indebtedness
evidenced by the Trust Preferred Securities shall be deemed to be Consolidated
Indebtedness.

“Consolidated Interest
Expense” shall mean, for any period and as to any Person, total cash interest
expense (including the interest component in respect of Capital Lease
Obligations in accordance with GAAP) of such Person and its Subsidiaries during
such period on a consolidated basis including, without limitation, all
commissions, discounts and other fees and charges owed with respect to letters
of credit and bankers’ acceptance financing and net costs under Interest Rate
Agreements, but excluding however, any amortization of deferred financing
costs.

“Consolidated Net
Income” shall mean, for any period for the Borrower and its Subsidiaries on a
consolidated basis, the net income of the Borrower and its Subsidiaries for
such period determined in accordance with GAAP.

“Consolidated Net
Worth” shall mean, with respect to any Person, the Net Worth of such Person and
its Subsidiaries determined on a consolidated basis in accordance with GAAP
after appropriate deduction for any minority interests in Subsidiaries.

“Consolidated
Total Capital” shall mean, at any time and as to any Person, the sum of (i)
Consolidated Indebtedness of such Person at such time and (ii) Consolidated Net
Worth of such Person at such time.

“Contingent
Obligations” shall mean, as to any Person, any obligation of such Person
guaranteeing or intended to guarantee any Indebtedness, leases, dividends or
other obligations (“primary obligations”) of any other Person (the “primary
obligor”) in any manner, whether directly or indirectly, including, without
limitation, any obligation of such Person, whether or not contingent, (a) to
purchase any such primary obligation or any property constituting direct or
indirect security therefor, (b) to advance or supply funds (i) for the purchase
or payment of any such primary obligation or (ii) to maintain working capital
or equity capital of the primary obligor or otherwise to maintain the net worth
or solvency of the primary obligor, (c) to purchase property, securities or
services primarily for the purpose of assuring the owner of any such primary
obligation of the ability of the primary obligor to make payment of such
primary obligation or (d) otherwise to assure or hold harmless the owner of
such primary obligation against loss in respect thereof; provided, however, that
the term Contingent Obligation shall not include (x) endorsements of
instruments for deposit or collection in the ordinary course of business or (y)
obligations of any Regulated Insurance Company under Insurance Contracts,
Reinsurance Agreements or Retrocession Agreements. The amount of any Contingent
Obligation shall be deemed to be an amount equal to the stated or determinable
amount of the primary obligation in respect of which such Contingent Obligation
is made or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof (assuming such Person is required to perform
thereunder) as determined by such Person in good faith.

“Continuing
Directors” shall mean the directors of the Borrower on the Initial Borrowing
Date and each other director if such director’s nomination for the election to
the Board of Directors of the Borrower is recommended by a majority of the then
Continuing Directors.

“Credit Documents”
shall mean this Agreement, the Fee Letter, the Notes (if any), the Letter of
Credit Applications and the Subsidiary Guaranty.

“Credit Extension”
shall mean each of the following: (a) a Borrowing and (b) an L/C Credit
Extension.

 52
 

“Credit Party”
shall mean the Borrower and each Subsidiary Guarantor.

“Default” shall
mean any event, act or condition which with notice or lapse of time, or both,
would constitute an Event of Default.

“Defaulting Bank”
shall mean any Bank with respect to which a Bank Default is in effect.

“Dollars” and “$”
shall mean lawful money of the United States.

“Domestic
Subsidiary” shall mean each direct or indirect Subsidiary of the Borrower which
is not a Foreign Subsidiary.

“Eligible Assignee”
shall mean (a) a Bank; (b) an Affiliate of a Bank; (c) an Approved Fund and (d)
any other Person (other than a natural person) approved by (i) the
Administrative Agent and the L/C Issuer, and (ii) unless an Event of Default
has occurred and is continuing, the Borrower (each such approval not to be
unreasonably withheld or delayed); provided that notwithstanding the foregoing,
“Eligible Assignee” shall not include the Borrower or any of the Borrower’s
Affiliates or Subsidiaries.

“Effective Date”
shall have the meaning provided in Section 11.11.

“ERISA” shall mean
the Employee Retirement Income Security Act of 1974, as amended from time to
time and the regulations promulgated and rulings issued thereunder.
Section references to ERISA are to ERISA, as in effect at the date of this
Agreement and any subsequent provisions of ERISA, amendatory thereof,
supplemental thereto or substituted therefor.

“ERISA Affiliate”
shall mean each person (as defined in Section 3(9) of ERISA) which
together with the Borrower or a Subsidiary of the Borrower would be deemed to
be a “single employer” within the meaning of Section 414(b),(c), (m) or
(o) of the Code.

“Eurodollar Loan”
shall mean each Loan bearing interest at the rates provided in
Section 1.09(b).

“Eurodollar Rate”
shall mean for any Interest Period with respect to any Eurodollar Loan:

(a)               The
rate per annum equal to the rate determined by the Administrative Agent to be
the offered rate that appears on the page of the Telerate screen (or any
successor thereto) that displays an average British Bankers Association
Interest Settlement Rate for deposits in Dollars (for delivery on the first day
of such Interest Period) with a term equivalent to such Interest Period,
determined as of approximately 11:00 a.m. (London time) two Business Days prior
to the first day of such Interest Period, or

(b)               If
the rate referenced in the preceding clause (a) does not appear on such
page or service or such page or service shall not be available, the rate per
annum equal to the rate determined by the Administrative Agent to be the
offered rate on such other page or other service that displays an average British
Bankers Association Interest Settlement Rate for deposits in Dollars (for
delivery on the first day of such Interest Period) with a term equivalent to
such Interest Period, determined as of approximately 11:00 a.m. (London time)
two Business Days prior to the first day of such Interest Period, or

(c)               If
the rates referenced in the preceding clauses (a) and (b) are not available,
the rate per annum determined by the Administrative Agent as the rate of
interest at which deposits in Dollars for delivery on the first day of such
Interest Period in same day funds in the

 53
 

approximate amount of the Eurodollar Loan being made, continued or
converted by Bank of America and with a term equivalent to such Interest Period
would be offered by Bank of America’s London Branch to major banks in the
London interbank eurodollar market at their request at approximately 4:00 p.m.
(London time) two Business Days prior to the first day of such Interest Period.

“Event of Default”
shall have the meaning provided in Section 8.

“Facility” shall
mean the Revolving Loan Facility.

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

“Fee Letter” shall mean that certain confidential letter agreement dated
as of January 18, 2007, among the Borrower, the Administrative Agent and the
Arranger.

“Fees” shall mean
all amounts payable pursuant to, or referred to in, Section 1.07(i) or (j)
or Section 2.01.

“Financial
Reinsurance Agreement” shall mean any “financing type” retrocession agreement
or reinsurance agreement in which an insurer or reinsurer cedes business, which
retrocession agreement or reinsurance agreement does not involve actual
transfer of risk, and is deemed not to qualify as reinsurance under SAP at the
time such agreement is entered into.

“Fixed Charges”
shall mean, for any fiscal quarter period for the Borrower and its Subsidiaries
on a consolidated basis, the sum of the following: (i) Consolidated Interest
Expense with respect to Indebtedness (including, without limitation, interest
expense on the Trust Preferred Securities) for such period, plus (ii) scheduled
principal repayments on Indebtedness (other than Indebtedness of the Borrower
or any of its Subsidiaries to the Borrower or any of its Subsidiaries) for such
period.

“Fixed Charge Coverage Ratio”
shall mean, for any four fiscal quarter period, the ratio of (i) Borrower Cash
Flow for such period to (ii) Fixed Charges for such period.

“Foreign
Subsidiary” shall mean each Subsidiary of the Borrower that is incorporated
under the laws of any jurisdiction other than the United States of America or
any State thereof.

“Fund” shall mean
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.

“GAAP” shall mean
generally accepted accounting principles in the United States of America; it
being understood and agreed that determinations in accordance with GAAP for
purposes of Section 7, including defined terms as used therein, are
subject (to the extent provided therein) to Section 11.08(a).

 54
 

“Golden Triangle”
shall mean Golden Triangle Physician Alliance, a Texas non-profit corporation.

“Governmental
Authority” shall mean any nation or government, any state or other political
subdivision thereof and any entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government.

“Heritage Health”
shall mean Heritage Health Systems, Inc., a Delaware corporation.

“Heritage
Physician Networks” shall mean Heritage Physician Networks, a Texas non-profit
corporation.

“Indebtedness” of any
Person shall mean (i) all indebtedness of such Person for borrowed money,
including, without limitation, the indebtedness evidenced by the Trust
Preferred Securities, (ii) the deferred purchase price of assets or services
which in accordance with GAAP would be shown on the liability side of the
balance sheet of such Person, (iii) the face amount of all letters of credit
issued for the account of such Person and, without duplication, all drafts
drawn thereunder, (iv) all Indebtedness of a second Person secured by any Lien
on any property owned by such first Person, whether or not such Indebtedness
has been assumed, (v) the principal portion of all Capitalized Lease
Obligations of such Person, (vi) all obligations of such Person to pay a
specified purchase price for goods or services whether or not delivered or
accepted, i.e., take-or-pay and similar obligations, (vii) all obligations of
such Person under Interest Rate Agreements and Other Hedging Agreements, (viii)
all Contingent Obligations of such Person and (ix) all Off-Balance Sheet
Liabilities of such Person; provided that Indebtedness shall not include trade
payables (including payables under insurance contracts and reinsurance
payables) and accrued expenses, in each case arising in the ordinary course of
business.

“Indemnified Liabilities”
shall have the meaning provided for in Section 11.01(b).

“Indemnitees” shall have
the meaning provided for in Section 11.01(b).

“Information” shall have
the meaning provided for in Section 11.17.

“Initial Borrowing
Date” shall mean the date upon which Loans are initially incurred hereunder.

“Initially
Excluded Subsidiaries” means Midwest Region, Inc., an Iowa corporation, Midwest
Region Inc. of Colorado, a Colorado corporation, Ameri-Plus Preferred Care,
Inc., a Florida corporation, Penn Marketing America, LLC, a Delaware limited
liability company, Premier Marketing Group, LLC, a Delaware limited liability
company, Senior Life Resource Center, Inc., a Florida corporation, and Senior
Resource Services LLC, a Florida limited liability company.

“Insurance
Business” shall mean one or more aspects of the business of selling, issuing or
underwriting insurance or reinsurance, which shall include the business
conducted by the Regulated Insurance Companies.

“Insurance
Contract” shall mean any insurance contract or policy issued by a Regulated
Insurance Company but shall not include any Reinsurance Agreement or
Retrocession Agreement.

“Interest Period”
shall mean, with respect to any Eurodollar Loan, the interest period applicable
thereto, as determined pursuant to Section 1.10.

 55
 

“Interest Rate
Agreement” shall mean any interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate hedging agreement or
other similar agreement or arrangement.

“Invested Assets”
shall mean, at any date for the Regulated Insurance Companies (on a
consolidated basis), the total amount as would be shown on line 10, page 2,
column 4 of a Benchmark Statement for the Regulated Insurance Companies (on a
consolidated basis) prepared as of such date.

“Investment Grade
Securities” shall mean and include (i) U.S. Government Obligations (other than
Cash Equivalents), (ii) debt securities or debt instruments with a rating of
BBB- or higher by S&P, Baa3 or higher by Moody’s, Class (2) or higher by
NAIC or the equivalent of such rating by S&P, Moody’s or NAIC, or if none
of S&P, Moody’s and NAIC shall then exist, the equivalent of such rating by
any other nationally recognized securities rating agency, but excluding any
debt securities or instruments constituting loans or advances among the
Borrower and its Wholly-Owned Subsidiaries, and (iii) any fund investing
exclusively in investments of the type described in clauses (i) and (ii) which
funds may also hold immaterial amounts of cash pending investment and/or
distribution.

“Issuer” shall mean any
issuer of Investment Grade Securities or Non-Investment Grade Securities
acquired or proposed to be acquired by the Borrower or any of its Subsidiaries
pursuant to Section 7.06.

“L/C Advance”
shall mean, with respect to each Bank, such Bank’s funding of its participation
in any L/C Borrowing in accordance with its pro rata share.

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

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

“L/C Issuer” shall mean
Bank of America in its capacity as issuer of Letters of Credit hereunder, or
any successor issuer of Letters of Credit hereunder.

“L/C Obligations” shall
mean, as at any date of determination, the aggregate undrawn amount of all
outstanding Letters of Credit plus the aggregate of all Unreimbursed Amounts,
including all L/C Borrowings.

“Legal
Requirements” shall mean all applicable laws, rules and regulations made by any
Governmental Authority or any Applicable Insurance Regulatory Authority having
jurisdiction over the Borrower or a Subsidiary of the Borrower.

“Letter of Credit”
shall mean any standby letter of credit issued hereunder.

“Letter of Credit
Application” shall mean an application and agreement for the issuance or
amendment of a Letter of Credit substantially in the form from time to time in
use by the L/C Issuer.

“Letter of Credit
Expiration Date” shall mean the earlier of (a) the day that is seven days prior
to the Revolving Loan Maturity Date then in effect (or, if such day is not a
Business Day, the next preceding Business Day) and (b) the date on which a
Change of Control occurs.

 56
 

“Letter of Credit
Sublimit” shall mean an amount equal to the lesser of the Total Revolving Loan
Commitment and $25,000,000.  The Letter
of Credit Sublimit is part of, and not in addition to, the Total Revolving Loan
Commitment.

“Lien” shall mean
any mortgage, pledge, security interest, encumbrance, lien or charge of any
kind (including any agreement to give any of the foregoing, any conditional
sale or other title retention agreement or any lease in the nature thereof).

“Loan” and “Loans”
shall have the respective meanings provided in Section 1.01.

“Margin Stock”
shall have the meaning provided in Regulation U.

“Material Adverse
Effect” shall mean (a) a material adverse change in, or a material adverse
effect upon, the operations, business, properties, liabilities (actual or
contingent), condition (financial or otherwise) or prospects of the Borrower
and its Subsidiaries taken as a whole; (b) a material impairment of the ability
of any Credit Party to perform its obligations under any Credit Document to
which it is a party; or (c) a material adverse effect upon the legality,
validity, binding effect or enforceability against any Credit Party of any
Credit Document to which it is a party.

“Maturity Date”
shall mean the Revolving Loan Maturity Date.

“Moody’s” shall
mean Moody’s Investors Service, Inc. and its successors.

“MSO EBITDA” shall
mean, for any period for the MSO Operations on a Combined basis, an amount
equal to the MSO Net Income for such period plus the following to the extent
deducted in calculating such MSO Net Income: (i) Consolidated Interest Expense
for such period, (ii) the provision for federal, state, local and foreign
income taxes payable by the MSO Operations for such period and (iii) the amount
of depreciation and amortization expense deducted in determining such MSO Net
Income.

“MSO Net Income”
shall mean, for any period for the MSO Operations on a Combined basis, the net
income of the MSO Operations (excluding extraordinary gains but including
extraordinary losses) for such period determined in accordance with GAAP.

“MSO Operations”
shall mean Heritage Health Systems of Texas, Inc., PSO Management and HHS Texas
Management LP and their respective Subsidiaries that are Non-Regulated
Companies and any other Subsidiary of the Borrower that is a Non-Regulated
Company but is not a Subsidiary of a Regulated Insurance Company and that is
engaged in a management service business similar to that of the MSO Operations
on the Effective Date.

“NAIC” shall mean
the National Association of Insurance Commissioners or any successor
organization thereto.

“NAIC Tests” shall
mean the ratios and other financial measurements developed by the NAIC under
its Insurance Regulatory Information System, as in effect from time to time.

“Net Available
Proceeds” shall mean (i) with respect to any Asset Sale consummated by a
Regulated Insurance Company, the Surplus Increase with respect to such
Regulated Insurance Company as a result of such Asset Sale, (ii) with respect
to any Asset Sale consummated by the Borrower or any Non-Regulated Company
which is not a Subsidiary of a Regulated Insurance Company, the Net Cash
Proceeds resulting therefrom and (iii) with respect to any Asset Sale
consummated by a Non-Regulated Company which is a Subsidiary of a Regulated
Insurance Company, an amount equal to the dividend that

 57

such Regulated Insurance
Company would be permitted to pay in accordance with the Legal Requirements
applicable to it as a result of the receipt by such Regulated Insurance Company
of a dividend from such Non-Regulated Company in an amount equal to the Net
Cash Proceeds resulting from such Asset Sale; in each case as determined in
good faith by the Borrower and certified in writing by the Borrower to the
Administrative Agent (showing the calculation thereof and supporting
assumptions) on or prior to the date on which the Borrower or any Subsidiary is
to receive the initial proceeds from such Asset Sale.

“Net Cash Proceeds”
shall mean, with respect to any Asset Sale, the Cash Proceeds resulting
therefrom net of (a) cash expenses of sale (including payment of principal,
premium and interest on Indebtedness other than the Loans required to be repaid
as a result of such Asset Sale), (b) incremental taxes paid or payable as a
result thereof and (c) amounts provided as a reserve, in accordance with GAAP,
against any liabilities under any indemnification obligations, purchase price
adjustments or similar items associated with such Asset Sale, in each case as
determined in good faith by the Borrower and certified in writing by the
Borrower to the Administrative Agent (showing the calculation thereof and
supporting assumptions) on or prior to the date on which the Borrower or any
Subsidiary is to receive the initial proceeds from such Asset Sale.

“Net Worth” shall
mean, as to any Person, the sum of its capital stock (including, without
limitation, its preferred stock), capital in excess of par or stated value of
shares of its capital stock (including, without limitation, its preferred
stock), retained earnings and any other account which, in accordance with GAAP,
constitutes stockholders equity, but excluding (i) any treasury stock and (ii)
the effects of Financial Accounting Statement No. 115.

“Non-Defaulting
Bank” shall mean any Bank other than a Defaulting Bank.

“Non-Investment
Grade Securities” shall mean debt and equity securities and debt and equity
instruments that do not constitute Investment Grade Securities or Cash
Equivalents (but excluding any debt or equity securities or instruments
constituting loans or advances among the Borrower and its Wholly-Owned Subsidiaries),
it being understood that for the purposes of any determination under
Section 7.06(f), the amounts, if any, paid by such Regulated Insurance
Company to purchase such equity securities or warrants shall be included in the
principal amounts of Non-Investment Grade Securities.

“Non-Regulated
Company” shall mean each Subsidiary of the Borrower which is not a Regulated
Insurance Company.

“Note” shall mean
each Revolving Note.

“Notice of
Borrowing” shall have the meaning provided in Section 1.03.

“Notice of
Conversion” shall have the meaning provided in Section 1.06.

“Notice Office”
shall mean the office of the Administrative Agent at 2001 Clayton Road,
Building B, Mail Code: CA4-702-02-25, Concord, California 94520,
Attention: Arthur K. Khoo, Telephone: (925) 675-8395, Facsimile:
(888) 203-0618, Email: arthur.k.khoo@bankofamerica.com, or such other
office as the Administrative Agent may designate by notice in writing to the
Borrower and the Banks from time to time.

“Obligations”
shall mean all amounts, direct or indirect, contingent or absolute, of every
type or description, and at any time existing, owing to the Administrative
Agent, the L/C Issuer or any Bank pursuant to the terms of this Agreement or
any other Credit Document, including interest and fees that

 58
 

accrue after the
commencement by or against any Credit Party or any Affiliate thereof of any
proceeding under the Bankruptcy Code or other debtor relief laws naming such
Person as the debtor in such proceeding, regardless of whether such interest
and fees are allowed claims in such proceeding.

“Off-Balance Sheet
Liabilities” shall mean with respect to
any Person as of any date of determination thereof, without duplication and to
the extent not included as a liability on the consolidated balance sheet of
such Person and its Subsidiaries in accordance with GAAP: (a) with respect to
any asset securitization transaction (including any accounts receivable
purchase facility) (i) the unrecovered investment of purchasers or transferees
of assets so transferred and (ii) any other payment, recourse, repurchase, hold
harmless, indemnity or similar obligation of such Person or any of its
Subsidiaries in respect of assets transferred or payments made in respect
thereof, other than limited recourse provisions that are customary for
transactions of such type and that neither (x) have the effect of limiting the
loss or credit risk of such purchasers or transferees with respect to payment
or performance by the obligors of the assets so transferred nor (y) impair the
characterization of the transaction as a true sale under applicable laws
(including debtor relief laws); (b) the monetary obligations under any
financing lease or so-called “synthetic,” tax retention or off-balance sheet
lease transaction which, upon the application of any debtor relief law to such
Person or any of its Subsidiaries, would be characterized as indebtedness; (c)
the monetary obligations under any sale and leaseback transaction which does
not create a liability on the consolidated balance sheet of such Person and its
Subsidiaries; or (d) any other monetary obligation arising with respect to any
other transaction which (i) upon the application of any debtor relief law to
such Person or any of its Subsidiaries, would be characterized as indebtedness
or (ii) is the functional equivalent of or takes the place of borrowing but
which does not constitute a liability on the consolidated balance sheet of such
Person and its Subsidiaries (for purposes of this clause (d), any transaction
structured to provide tax deductibility as interest expense of any dividend,
coupon or other periodic payment will be deemed to be the functional equivalent
of a borrowing.

“Organizational Documents” shall mean, for any entity, its
constituent or organizational documents, including: (a) in the case of any
partnership, joint venture, trust or other form of business entity, the
partnership, joint venture or other applicable agreement of formation and any
agreement, instrument, filing or notice with respect thereto filed in connection
with its formation with the secretary of state or other department in the state
of its formation, in each case as amended from time to time; (b) in the
case of any limited liability company, the articles of formation and operating
agreement; and (c) in the case of a corporation, the certificate or
articles of incorporation and bylaws.

“Other Credit
Agreement” shall mean that certain Amended and Restated Credit Agreement dated
as of May 28, 2004, as heretofore or hereafter amended or modified, among
the Borrower, certain lenders and Bank of America, N.A., as Administrative Agent.

“Other Hedging
Agreements” shall mean any foreign exchange contracts, currency swap agreements
or other similar agreements or arrangements designed to protect against
fluctuations in currency values.

“Outstanding Amount”
shall mean (i) with respect to Revolving Loans on any date, the aggregate
outstanding principal amount thereof after giving effect to any Borrowings
under the Revolving Loan Facility and prepayments or repayments of Revolving
Loans occurring on such date and (ii) with respect to any L/C Obligations on
any date, the amount of such L/C Obligations on such date after giving effect
to any L/C Credit Extension occurring on such date and any other changes in the
aggregate amount of the L/C Obligations as of such date, including as a result
of any reimbursements of outstanding unpaid drawings under any Letters of
Credit or any reductions in the maximum amount available for drawing under
Letters of Credit taking effect on such date.

 59
 

“Participant”
shall have the meaning provided in Section 11.04(c).

“Payment Office”
shall mean the office of the Administrative Agent at 2001 Clayton Road,
Building B, Mail Code: CA4-702-02-25, Concord, California 94520,
Attention: Arthur K. Khoo, Telephone: (925) 675-8395, Facsimile:
(888) 203-0618, Email: arthur.k.khoo@bankofamerica.com, or such other
office as the Administrative Agent may designate by notice in writing to the
Borrower and the Banks from time to time.

“Permitted
Acquisition” shall have the meaning provided in Section 7.02(i).

“Person” shall
mean any individual, partnership, joint venture, firm, corporation, limited
liability company, association, trust or other enterprise or any government or
political subdivision or any agency, department or instrumentality thereof.

“Plan” shall mean
any pension plan as defined in Section 3(2) of ERISA, which is maintained
or contributed to by (or to which there is an obligation to contribute of) the
Borrower or a Subsidiary of the Borrower or an ERISA Affiliate, and each such
plan for the five year period immediately following the latest date on which
the Borrower, or a Subsidiary of the Borrower or an ERISA Affiliate maintained,
contributed to or had an obligation to contribute to such plan.

“PSO Management”
shall mean PSO Management of Texas, LLC, a Georgia limited liability company.

“Quarterly
Adjusted Dividend Capacity” shall mean, for any fiscal quarter period, the
aggregate amount of dividends that the Regulated Insurance Companies (other than
SelectCare) could pay directly to the Borrower or American Exchange during the
fiscal year in which such fiscal quarter period occurs under applicable Legal
Requirements (without obtaining extraordinary dividend approval from any
Applicable Insurance Regulatory Authority), divided by four.

“Quarterly
Statement” shall mean the quarterly financial statement required to be filed by
any Regulated Insurance Company with the Applicable Regulatory Insurance
Authority.

“Register” shall
have the meaning provided in Section 6.12.

“Regulated
Insurance Company” shall mean any Subsidiary of the Borrower, whether now owned
or hereafter acquired, that is authorized or admitted to carry on or transact
Insurance Business in any jurisdiction and is regulated by any Applicable
Insurance Regulatory Authority.

“Regulation D”
shall mean Regulation D of the Board of Governors of the Federal Reserve System
as from time to time in effect and any successor to all or a portion thereof
establishing reserve requirements.

“Regulation U”
shall mean Regulation U of the Board of Governors of the Federal Reserve System
as from time to time in effect and any successor to all or a portion thereof
establishing margin requirements.

“Reinsurance
Agreement” shall mean any agreement, contract, treaty or other arrangement
whereby one or more insurers, as reinsurers, assume liabilities under or with
respect to insurance policies or agreements issued by another insurance or
reinsurance company or companies.

“Replaced Bank”
shall have the meaning provided in Section 1.14.

 60
 

“Replacement Bank”
shall have the meaning provided in Section 1.14.

“Reportable Event”
shall mean an event described in Section 4043(c) of ERISA with respect to
a Plan, other than those events as to which the 30-day notice period is waived.

“Required Banks”
shall mean Non-Defaulting Banks the sum of whose Revolving Loan Commitments
(or, if after the Total Revolving Loan Commitment has been terminated,
outstanding Revolving Loans and participations in L/C Obligations) constitute a
majority of the Total Revolving Loan Commitment less the aggregate Revolving
Loan Commitments of Defaulting Banks, if any, (or, if after the Total Revolving
Loan Commitment has been terminated, the total outstanding Revolving Loans and
participations in L/C Obligations of Non-Defaulting Banks).

“Responsible
Officer” shall mean, with respect to the Borrower or any of its Subsidiaries,
the chief executive officer, president, chief operating officer, any
vice-president or secretary of such Person and, with respect to financial
matters, the chief financial officer, treasurer or controller of such Person.

“Retrocession
Agreement” shall mean any agreement, contract, treaty or other arrangement
whereby one or more insurers or reinsurers, as retrocessionaires, assume liabilities
of reinsurers under or with respect to a Reinsurance Agreement or other
retrocessionaires under another Retrocession Agreement.

“Revolving Loan”
and “Revolving Loans” shall have the respective meanings provided in
Section 1.01(a).

“Revolving Loan Commitment”
shall mean, with respect to each Bank, the amount set forth opposite such Bank’s
name on Schedule 1 directly below the column entitled “Revolving Loan
Commitment,” as the same may be reduced from time to time or terminated
pursuant to Sections 2.02, 3.01 and/or 8.

“Revolving Loan
Facility” shall mean the Facility evidenced by the Total Revolving Loan
Commitment.

“Revolving Loan
Maturity Date” shall mean September 30, 2007 or, if earlier, the date on which
the Total Revolving Loan Commitment is reduced to zero or terminated pursuant
to Section 2.02 or 3.01.

“Revolving Note”
shall mean a promissory note substantially in the form of Exhibit B, and
all renewals and extension of all or any part thereof.

“Risk Based
Capital Ratio” shall mean, for any Regulated Insurance Company, the ratio
(expressed as a percentage), at any time, of the Total Adjusted Capital of such
Regulated Insurance Company to the Company Action Level of such Regulated
Insurance Company.

“Risk Derivatives”
shall mean Z bonds, floaters/inverse floaters, PAC II, PAC III, Ioettes,
support bonds, Interest Only Investments, Principal Only Investments residuals,
inverse IO’s, super floaters, any other instruments with similar economic risk
factors and any bonds backed in whole or in part by any of the foregoing
(including component or “kitchen sink” bonds).

“Rollover Amount”
shall have the meaning provided in Section 7.05(b).

“S&P” shall
mean Standard & Poor’s Ratings Group and its successors.

 61
 

“S&P Credit
Rating” shall mean the rating level (it being understood that a rating level
shall include numerical modifiers and (+) and (-) modifiers) assigned by
S&P to the senior unsecured long-term debt of an Issuer.

“S&P
Equivalent Rating” shall mean, with respect to any Investment Grade Security or
Non-Investment Grade Security, the rating given such security by S&P or the
S&P equivalent rating of the rating given such security by Moody’s or NAIC,
it being understood that if any such security is rated by more than one of
S&P, Moody’s and NAIC and any of such ratings (or the S&P equivalent of
such ratings) differ, then the S&P Equivalent Rating for such security
shall be the lower or lowest, as the case may be, of such ratings (or the
S&P equivalent of such ratings).

“SAP” shall mean,
with respect to any Regulated Insurance Company, the accounting procedures and
practices prescribed or permitted by the Applicable Insurance Regulatory
Authority of the state in which such Regulated Insurance Company is domiciled;
it being understood and agreed that determinations in accordance with SAP for
purposes of Section 7, including defined terms as used therein, are
subject (to the extent provided therein) to Section 11.08(a).

“SEC” shall mean
the Securities and Exchange Commission or any successor thereto.

“SEC Regulation D”
shall mean Regulation D as promulgated under the Securities Act of 1933, as
amended, as the same may be in effect from time to time.

“Section 3.05(e)(ii)
Certificate” shall have the meaning provided in Section 3.05(e)(ii).

“SelectCare” shall
mean SelectCare of Texas, LLC, a Georgia limited liability company.

“Subsidiary” of
any Person shall mean and include (i) any corporation more than 50% of whose
stock of any class or classes having by the terms thereof ordinary voting power
to elect a majority of the directors of such corporation (irrespective of
whether or not at the time stock of any class or classes of such corporation
shall have or might have voting power by reason of the happening of any
contingency) is at the time owned by such Person directly or indirectly through
Subsidiaries and (ii) any partnership, association, joint venture or other
entity in which such Person directly or indirectly through Subsidiaries has
more than a 50% equity or voting interest at the time.  Unless otherwise expressly provided, all
references herein to “Subsidiary” shall mean a Subsidiary of the Borrower.  In any event, each of SelectCare, Golden
Triangle Physician Alliance and Heritage Physician Networks shall be deemed to
be a Subsidiary of the Borrower.

“Subsidiary
Guarantor” shall mean each Domestic Subsidiary of the Borrower which is a
Non-Regulated Company; provided that (i) none of the Initially Excluded
Subsidiaries shall be a Subsidiary Guarantor on the Effective Date and (ii)
neither Golden Triangle nor Heritage Physician Networks shall be a Subsidiary
Guarantor.

“Subsidiary
Guaranty” shall mean the Subsidiary Guaranty substantially in the form of
Exhibit F (as modified, amended or supplemented from time to time in
accordance with the terms hereof and thereof).

“Surplus Increase”
shall mean, with respect to each Asset Sale effected by a Regulated Insurance
Company, the increase in Adjusted Statutory Capital and Surplus of such
Regulated Insurance Company as a result of such Asset Sale.

 62
 

“Surplus Note” shall
mean the surplus note dated as of July 30, 1999, as amended, issued by
American Exchange to the Borrower.

“Tax Benefit”
shall have the meaning provided in Section 3.05(f).

“Tax Sharing
Agreements” shall mean all tax sharing, tax allocation and other similar
agreements entered into by the Borrower and/or any of its Subsidiaries.

“Taxes” shall have
the meaning provided in Section 3.05(a).

“Total Adjusted
Capital” shall mean “Total Adjusted Capital” as defined by the NAIC from time
to time and as applied in the context of the Risk Based Capital Guidelines
promulgated by the NAIC (or any term substituted therefor by the NAIC).

“Total Commitment”
shall mean the Total Revolving Loan Commitment.

“Total Revolving
Loan Commitment” shall mean the sum of the Revolving Loan Commitments of each
of the Banks.

“Total Unutilized
Revolving Loan Commitment” shall mean, at any time, the Total Revolving Loan
Commitment at such time less (i) the Outstanding Amount of all Revolving Loans
at such time and (ii) the Outstanding Amount of all L/C Obligations at such
time.

“TPA EBITDA” shall
mean, for any period for the TPA
Operations on a Combined basis, an amount equal to the TPA Net Income for such
period plus the following to the extent deducted in calculating such TPA Net
Income: (i) Consolidated Interest Expense for such period, (ii) the provision
for federal, state, local and foreign income taxes payable by the TPA
Operations for such period and (iii) the amount of depreciation and
amortization expense deducted in determining such TPA Net Income.

“TPA Net Income” shall mean, for any period for the TPA Operations on a
Combined basis, the net income of the TPA Operations (excluding extraordinary
gains but including extraordinary losses) for such period determined in
accordance with GAAP.

“TPA Operations” shall mean WorldNet and its Subsidiaries that are
Non-Regulated Companies and any other Subsidiary of the Borrower that is a
Non-Regulated Company but is not a Subsidiary of a Regulated Insurance Company
and that is engaged in an administrative services business similar to that of
the TPA Operations on the Effective Date.

“Trust Preferred Securities” shall mean(i) the Floating
Rate Junior Subordinated Deferrable Interest Debentures issued by the Borrower
pursuant to the Indenture dated as of December 4, 2002 (as amended,
modified or supplemented from time to time), between the Borrower and State
Street Bank and Trust Company of Connecticut, National Association, as trustee,
and the guaranty executed in connection therewith, (ii) the Floating Rate
Junior Subordinated Deferrable Interest Debentures issued by the Borrower
pursuant to the Indenture dated as of March 27, 2003 (as amended, modified
or supplemented from time to time), between the Borrower and Wells Fargo Bank,
National Association, as trustee, and the guaranty executed in connection
therewith, (iii) the Fixed/Floating Rate Junior Subordinated Deferrable
Interest Debentures issued by the Borrower pursuant to the Indenture dated as
of May 15, 2003 (as amended, modified or supplemented from time to time),
between the Borrower and U.S. Bank National Association, as debenture
trustee, and the guaranty executed in
connection therewith, (iv) the Floating Rate Junior Subordinated Debt
Securities issued by the Borrower pursuant to the Indenture dated as of
May 22, 2003 (as amended, modified or supplemented from time to time),
between the Borrower and the

 63
 

Wilmington
Trust Company, as trustee, and the guaranty executed in connection therewith,
(v) the Floating Rate Junior Subordinated Deferrable Interest Debentures issued
by the Borrower pursuant to the Indenture dated as of October 29, 2003 (as
amended, modified or supplemented from time to time), between the Borrower and
U.S. Bank National Association, as debenture trustee, and the guaranty executed
in connection therewith and (vi) any floating rate or fixed rate junior
subordinated deferrable interest debentures in an aggregate amount up to
$31,000,000, issued by the Borrower after May 28, 2004 pursuant to an indenture
and guaranty executed in connection therewith having terms (including
subordination provisions, redemption or prepayment rights or obligations,
tenor, deferral of interest rights, covenants and defaults) no less favorable
to the Banks than those set forth in the Trust Preferred Securities described
in clause (i) preceding as such Trust Preferred Securities were in effect on
May 28, 2004.

“Type” shall mean
a Base Rate Loan or a Eurodollar Loan.

“UCC” shall mean
the Uniform Commercial Code, as the same may be amended from time to time.

“Unfunded Current
Liability” of any Plan shall mean the amount, if any, by which the actuarial
present value of the accumulated plan benefits under the Plan as of the close
of its most recent plan year exceeds the fair market value of the assets
allocable thereto, each determined in accordance with Statement of Financial
Accounting Standards No. 87, based upon the actuarial assumptions used by the
Plan’s actuary in the most recent annual valuation of the Plan.

“Unreimbursed
Amount” shall have the meaning provided in Section 1.07(c)(i).

“Unutilized
Revolving Loan Commitment” with respect to any Bank at any time shall mean such
Bank’s Revolving Loan Commitment at such time less (i) the Outstanding Amount
of all Revolving Loans made by such Bank at such time and (ii) such Bank’s pro
rata share of the Outstanding Amount of all L/C Obligations at such time.

“U.S. Government
Obligations” shall mean and include (A) securities that are (x) direct
obligations of the United States of America for the timely payment of which its
full faith and credit is pledged or (y) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States
of America the timely payment of which is unconditionally guaranteed as a full
faith and credit obligation by the United States of America, which, in either
case, are not callable or redeemable at the option of the issuer thereof, and
shall also include a depository receipt issued by a bank (as defined in
Section 3(a)(2) of the Securities Act of 1933, as amended), as custodian
with respect to any such U.S. Government Obligation or a specific payment of
principal of or interest on any such U.S. Government Obligation held by such
custodian for the account of the holder of such depository receipt; provided
that (except as required by law) such custodian is not authorized to make any
deduction from the amount payable to the holder of such depository receipt from
any amount received by the custodian in respect of the U.S. Government Obligation
or the specific payment of principal of or interest on the U.S. Government
Obligation evidenced by such depository receipt and (B) to the extent in each
case having an S&P Equivalent Rating of AAA, obligations issued or
guaranteed by the Federal Home Loan Mortgage Corporation, the Federal National
Mortgage Association, the Government National Mortgage Association, the Student
Loan Marketing Association and the Federal Home Loan Bank.

“Wholly-Owned
Subsidiary” of any Person shall mean any Subsidiary of such Person to the
extent all of the capital stock or other ownership interests in such
Subsidiary, other than directors’ or nominees’ qualifying shares, is owned
directly or indirectly by such Person.

 64
 

“WorldNet” shall
mean WorldNet Services Corp., a Florida corporation.

“Written” or “in
writing” shall mean any form of written communication or a communication by
means of telex, facsimile device, telegraph or cable.

SECTION 10.         The Administrative Agent.

10.01       Appointment.

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

(b)           [Intentionally
Omitted].

(c)           The
L/C Issuer shall act on behalf of the Banks with respect to any Letters of Credit
issued by it and the documents associated therewith, and the L/C Issuer shall
have all of the benefits and immunities (i) provided to the Administrative
Agent in this Section 10 with respect to any acts taken or omissions
suffered by the L/C Issuer in connection with Letters of Credit issued by it or
proposed to be issued by it and the applications and agreements for letters of
credit pertaining to such Letters of Credit as fully as if the term “Administrative
Agent” as used in this Section 10 and in the definition of “Agent-Related
Person” included the L/C Issuer with respect to such acts or omissions, and
(ii) as additionally provided herein with respect to the L/C Issuer.

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

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

 65
 

Administrative Agent
under or in connection with, this Agreement or any other Credit Document, or
the validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any other Credit Document, or for any failure of any Credit Party
or any other party to any Credit Document to perform its obligations hereunder
or thereunder.  No Agent-Related Person
shall be under any obligation to any Bank or participant to ascertain or to
inquire as to the observance or performance of any of the agreements contained
in, or conditions of, this Agreement or any other Credit Document (other than
the obligation of the Administrative Agent to ascertain whether payments on the
Obligations have been made on their scheduled due dates), or to inspect the
properties, books or records of any Credit Party or any Affiliate thereof.

10.04       Reliance by the Administrative Agent.

(a)           The
Administrative Agent shall be entitled to rely, and shall be fully protected in
relying, upon any writing, communication, signature, resolution,
representation, notice, consent, certificate, affidavit, letter, telegram,
facsimile, telex or telephone message, electronic mail message, statement or
other document or conversation believed by it to be genuine and correct and to
have been signed, sent or made by the proper Person or Persons, and upon advice
and statements of legal counsel (including counsel to any Credit Party),
independent accountants and other experts selected by the Administrative
Agent.  The Administrative Agent shall be
fully justified in failing or refusing to take any action under any Credit
Document unless it shall first receive such advice or concurrence of the Required
Banks as it deems appropriate and, if it so requests, it shall first be
indemnified to its satisfaction by the Banks against any and all liability and
expense which may be incurred by it by reason of taking or continuing to take
any such action.  The Administrative
Agent shall in all cases be fully protected in acting, or in refraining from
acting, under this Agreement or any other Credit Document in accordance with a
request or consent of the Required Banks (or such greater number of Banks as
may be expressly required hereby in any instance) and such request and any
action taken or failure to act pursuant thereto shall be binding upon all the
Banks.

(b)           For
purposes of determining compliance with the conditions specified in
Section 4 that are applicable on or prior to the Initial Borrowing Date,
each Bank that has signed this Agreement shall be deemed to have consented to,
approved or accepted or to be satisfied with, each document or other matter
required thereunder to be consented to or approved by or acceptable or
satisfactory to a Bank unless the Administrative Agent shall have received
notice from such Bank prior to the proposed Initial Borrowing Date specifying
its objection thereto.

10.05       Notice of Default.  The Administrative Agent shall not be deemed
to have knowledge or notice of the occurrence of any Default or Event of
Default hereunder, except with respect to defaults in the payment of principal,
interest and fees required to be paid to the Administrative Agent for the
account of the Banks, unless the Administrative Agent shall have received
written notice from a Bank or any other Credit Party referring to this
Agreement, describing such Default or Event of Default and stating that such
notice is a “notice of default.” In the event that the Administrative Agent
receives such a notice, the Administrative Agent shall give prompt notice
thereof to the Banks.  The Administrative
Agent shall take such action with respect to such Default or Event of Default
as shall be reasonably directed by the Required Banks, provided that unless and
until the Administrative Agent shall have received such directions, the
Administrative 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 Banks.

10.06       Credit Decision; Disclosure
of Information by the Administrative Agent. 
Each Bank acknowledges that no Agent-Related Person has made any
representation or warranty to it, and that no act

 66
 

by the Administrative Agent
hereafter taken, including any consent to and acceptance of any assignment or
review of the affairs of any Credit Party or any Affiliate thereof, shall be
deemed to constitute any representation or warranty by any Agent-Related Person
to any Bank as to any matter, including whether Agent-Related Persons have
disclosed material information in their possession.  Each Bank represents to the Administrative
Agent that it has, independently and without reliance upon any Agent-Related
Person and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
prospects, operations, property, financial and other condition and
creditworthiness of the Credit Parties and their respective Subsidiaries, and
all applicable bank or other regulatory laws relating to the transactions
contemplated hereby, and made its own decision to enter into this Agreement and
to extend credit to the Borrower hereunder. 
Each Bank also represents that it will, independently and without
reliance upon any Agent-Related Person and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Credit Documents, and to make such investigations
as it deems necessary to inform itself as to the business, prospects,
operations, property, financial and other condition and creditworthiness of the
Borrower and the other Credit Parties. 
Except for notices, reports and other documents expressly required to be
furnished to the Banks by the Administrative Agent herein, the Administrative
Agent shall not have any duty or responsibility to provide any Bank with any
credit or other information concerning the business, prospects, operations,
property, financial and other condition or creditworthiness of any of the
Credit Parties or any of their respective Affiliates which may come into the
possession of any Agent-Related Person.

10.07       Indemnification.  Whether or not the transactions contemplated
hereby are consummated, the Banks shall indemnify upon demand each
Agent-Related Person (to the extent not reimbursed by or on behalf of any
Credit Party and without limiting the obligation of any Credit Party to do so),
pro rata, and hold harmless each Agent-Related Person from and against any and
all Indemnified Liabilities incurred by it; provided, however, that no Bank
shall be liable for the payment to any Agent-Related Person of any portion of such
Indemnified Liabilities to the extent determined in a final, nonappealable
judgment by a court of competent jurisdiction to have resulted from such
Agent-Related Person’s own gross negligence or willful misconduct; provided,
however, that no action taken in accordance with the directions of the Required
Banks shall be deemed to constitute gross negligence or willful misconduct for
purposes of this Section.  Without
limitation of the foregoing, each Bank shall reimburse the Administrative Agent
upon demand for its ratable share of any costs or out-of-pocket expenses
(including Attorney Costs) incurred by the Administrative Agent in connection
with the preparation, execution, delivery, administration, modification,
amendment or enforcement (whether through negotiations, legal proceedings or
otherwise) of, or legal advice in respect of rights or responsibilities under,
this Agreement, any other Credit Document, or any document contemplated by or
referred to herein, to the extent that the Administrative Agent is not
reimbursed for such expenses by or on behalf of the Borrower.  The undertaking in this Section shall
survive termination of the Total Commitments, the expiration or termination of
all Letters of Credit, the payment of all other Obligations and the resignation
of the Administrative Agent.

10.08       The Administrative Agent in
its Individual Capacity.  Bank of America
and its Affiliates may make loans to, issue letters of credit for the account
of, accept deposits from, acquire equity interests in and generally engage in
any kind of banking, trust, financial advisory, underwriting or other business
with each of the Credit Parties and their respective Affiliates as though Bank
of America were not the Administrative Agent or the L/C Issuer hereunder and
without notice to or consent of the Banks. 
The Banks acknowledge that, pursuant to such activities, Bank of America
or its Affiliates may receive information regarding any Credit Party or its
Affiliates (including information that may be subject to confidentiality
obligations in favor of such Credit Party or such Affiliate) and acknowledge
that the Administrative Agent shall be under no obligation to provide such
information to them.  With respect to its
Loans, Bank of America shall have the same rights and powers under this
Agreement as any other

 67
 

Bank and may exercise
such rights and powers as though it were not the Administrative Agent or the
L/C Issuer, and the terms “Bank” and “Banks” include Bank of America in its
individual capacity.

10.09       Successor Administrative
Agent.  The Administrative Agent may
resign as the Administrative Agent upon 30 days’ notice to the Banks; provided that any such resignation by Bank of
America shall also constitute its resignation as the L/C Issuer.  If the Administrative Agent resigns under
this Agreement, the Required Banks shall appoint from among the Banks a
successor administrative agent for the Banks, which successor administrative
agent shall be consented to by the Borrower at all times other than during the
existence of an Event of Default (which consent of the Borrower shall not be
unreasonably withheld or delayed).  If no
successor administrative agent is appointed prior to the effective date of the
resignation of the Administrative Agent, the Administrative Agent may appoint,
after consulting with the Banks and the Borrower, a successor administrative
agent from among the Banks.  Upon the
acceptance of its appointment as successor administrative agent hereunder, the
Person acting as such successor administrative agent shall succeed to all the
rights, powers and duties of the retiring Administrative Agentand the L/C Issuer
and the respective terms “Administrative Agent” and “L/C Issuer” shall mean
such successor administrative agent and Letter of Credit issuer and the retiring
Administrative Agent’s appointment, powers and duties as Administrative Agent
shall be terminated and the retiring L/C Issuer’s rights, powers and duties as
such shall be terminated, without any other or further act or deed on the part
of such retiring L/C Issuer or any other Bank, other than the obligation of the
successor L/C Issuer to issue letters of credit in substitution for the Letters
of Credit, if any, outstanding at the time of such succession or to make other
arrangements satisfactory to the retiring L/C Issuer to effectively assume the
obligations of the retiring L/C Issuer with respect to such Letters of Credit.  After any retiring Administrative Agent’s
resignation hereunder as Administrative Agent, the provisions of this
Section 10 and Section 11.01 shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Administrative Agent
under this Agreement.  If no successor
administrative agent has accepted appointment as Administrative Agent by the
date which is 30 days following a retiring Administrative Agent’s notice of
resignation, the retiring Administrative Agent’s resignation shall nevertheless
thereupon become effective and the Banks shall perform all of the duties of the
Administrative Agent hereunder until such time, if any, as the Required Banks
appoint a successor administrative agent as provided for above.

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

(a)           To
file and prove a claim for the whole amount of the principal and interest owing
and unpaid in respect of the Loans, L/C Obligations and all other Obligations
that are owing and unpaid and to file such other documents as may be necessary
or advisable in order to have the claims of the Banks and the Administrative
Agent (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Banks and the Administrative Agent and their
respective agents and counsel and all other amounts due the Banks and the
Administrative Agent under Sections 1.07(i) and (j), 2.01 and 11.01(a))
allowed in such judicial proceeding; and

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

 68
 

and any custodian,
receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Bank to make such
payments to the Administrative Agent and, in the event that the Administrative
Agent shall consent to the making of such payments directly to the Banks, to
pay to the Administrative Agent any amount due for the reasonable compensation,
expenses, disbursements and advances of the Administrative Agent and its agents
and counsel, and any other amounts due the Administrative Agent under
Sections 2.01 and 11.01(a).

Nothing contained herein
shall be deemed to authorize the Administrative Agent to authorize or consent
to or accept or adopt on behalf of any Bank any plan of reorganization,
arrangement, adjustment or composition affecting the Obligations or the rights
of any Bank or to authorize the Administrative Agent to vote in respect of the
claim of any Bank in any such proceeding.

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

SECTION 11.         Miscellaneous.

11.01       Payment of Expenses and
Taxes; Indemnification by the Borrower.

(a)           The
Borrower agrees (i) to pay or reimburse the Administrative Agent for all
reasonable costs and expenses incurred in connection with the development,
preparation, negotiation and execution of this Agreement and the other Credit
Documents and any amendment, waiver, consent or other modification of the
provisions hereof and thereof (whether or not the transactions contemplated
hereby or thereby are consummated), and the consummation and administration of
the transactions contemplated hereby and thereby, including all Attorney Costs,
and (ii) to pay or reimburse the Administrative Agent and each Bank for all
costs and expenses incurred in connection with the enforcement, attempted
enforcement, or preservation of any rights or remedies under this Agreement or
the other Credit Documents (including all such costs and expenses incurred
during any “workout” or restructuring in respect of the Obligations and during
any legal proceeding, including any proceeding under the Bankruptcy Code or
other debtor relief laws), including all Attorney Costs.  The foregoing costs and expenses shall
include all search, filing, recording and other out-of-pocket expenses incurred
by the Administrative Agent and the cost of independent public accountants and
other outside experts retained by the Administrative Agent or any Bank.  All amounts due under this
Section 11.01(a) shall be payable within ten Business Days after demand
therefor.  The agreements in this
Section shall survive the termination of the Total Commitments, the
expiration or termination of all Letters of Credit and repayment of all other
Obligations.

(b)           Whether
or not the transactions contemplated hereby are consummated, the Borrower shall
indemnify and hold harmless each Agent-Related Person, each Bank and their
respective Affiliates, directors, officers, employees, counsel, agents and
attorneys-in-fact (collectively the “Indemnitees”) from and against any and all
liabilities, obligations, losses, damages, penalties, claims, demands, actions,
judgments, suits, costs, expenses and disbursements (including Attorney Costs)
of any kind or nature whatsoever which may at any time be imposed on, incurred
by or asserted against any such Indemnitee in any way relating to or

 69

arising out of or in connection with (i) the execution, delivery,
enforcement, performance or administration of any Credit Document or any other
agreement, letter or instrument delivered in connection with the transactions
contemplated thereby or the consummation of the transactions contemplated
thereby, (ii) any Commitment, Loan or Letter of Credit or the use or proposed
use of the proceeds therefrom (including any refusal by the L/C Issuer to honor
a demand for payment under a Letter of Credit if the documents presented in
connection with such demand do not strictly comply with the terms of such
Letter of Credit) or(iii) any
actual or prospective claim, litigation, investigation or proceeding relating
to any of the foregoing, whether based on contract, tort or any other theory
(including any investigation of, preparation for, or defense of any pending or
threatened claim, investigation, litigation or proceeding) and regardless of
whether any Indemnitee is a party thereto (all the foregoing, collectively, the
“Indemnified Liabilities”), in all cases, whether or not caused by or arising,
in whole or in part, out of the negligence of the Indemnitee; provided that
such indemnity shall not, as to any Indemnitee, be available to the extent that
such liabilities, obligations, losses, damages, penalties, claims, demands,
actions, judgments, suits, costs, expenses or disbursements are determined by a
court of competent jurisdiction by final and nonappealable judgment to have
resulted from the gross negligence or willful misconduct of such Indemnitee;
and provided further that such indemnity shall not be available in respect of
Taxes, Other Taxes and amounts related thereto, payment with respect to which
shall be governed solely by Section 3.05. 
No Indemnitee shall be liable for any damages arising from the use by
others of any information or other materials obtained through IntraLinks or
other similar electronic information transmission systems in connection with
this Agreement, nor shall any Indemnitee have any liability for any indirect or
consequential damages relating to this Agreement or any other Credit Document
or arising out of its activities in connection herewith or therewith (whether
before or after the Initial Borrowing Date).  All amounts due under this Section 11.01(b)
shall be payable within ten Business Days after demand therefor.  The agreements in this Section shall
survive the resignation of the Administrative Agent, the replacement of any
Bank, the termination of the Total Commitments, the expiration or termination
of all Letters of Credit and the repayment, satisfaction or discharge of all
the other Obligations.

11.02       Right of Setoff.  In addition to any rights now or hereafter
granted under applicable law or otherwise, and not by way of limitation of any
such rights, if an Event of Default has occurred and is continuing, each Bank
is hereby authorized at any time or from time to time, except to the extent
prohibited by applicable law, without presentment, demand, protest or other
notice of any kind to any Credit Party or to any other Person, any such notice
being hereby expressly waived, to set off and to appropriate and apply any and
all deposits (general or special) and any other Indebtedness at any time held
or owing by such Bank (including, without limitation, by branches and agencies
of such Bank wherever located) to or for the credit or the account of such
Credit Party against and on account of the Obligations and liabilities of such
Credit Party to such Bank or any other Bank under this Agreement or under any
of the other Credit Documents, including, without limitation, all interests in
Obligations of such Credit Party purchased by such Bank or any other Bank
pursuant to Section 11.06(b), and all other claims of any nature or
description arising out of or connected with this Agreement or any other Credit
Document, irrespective of whether or not such Bank shall have made any demand
hereunder and although said Obligations, liabilities or claims, or any of them,
shall be contingent or unmatured.  Each
Bank is hereby designated the agent of all other Banks for purposes of
effecting set off pursuant to this Section 11.02 and each Credit Party
hereby grants to each Bank for such Bank’s own benefit and as agent for all
other Banks a continuing security interest in any and all deposits, accounts or
moneys of such Credit Party maintained from time to time with such Bank.

 70
 

11.03       Notices.

(a)           General.  Unless otherwise expressly provided herein,
all notices and other communications provided for hereunder shall be in writing
(including by facsimile transmission). 
All such written notices shall be mailed, faxed or delivered to the
applicable address, facsimile number or (subject to clause (c) below)
electronic mail address, and all notices and other communications expressly
permitted hereunder to be given by telephone shall be made to the applicable
telephone number, as follows: (i) if to any Credit Party, to the address,
facsimile number, electronic mail address or telephone number of the Borrower
specified opposite its signature below or to such other address, facsimile
number, electronic mail address or telephone number as shall be designated by
such Person in a notice to the other parties; and (ii) if to the Administrative
Agent, the L/C Issuer or any Bank, to the address, facsimile number, electronic
mail address or telephone number specified on Schedule 2 hereto or to such
other address, facsimile number, electronic mail address or telephone number as
shall be designated by such Person in a notice to the other parties.  All such notices and other communications
shall be deemed to be given or made upon the earlier to occur of (x) actual
receipt by the relevant party hereto and (y) (A) if delivered by hand or by
courier, when signed for by or on behalf of the relevant party hereto; (B) if
delivered by mail, four Business Days after deposit in the mails, postage
prepaid; (C) if delivered by facsimile, when sent and receipt has been
confirmed by telephone; and (D) if delivered by electronic mail (which form of
delivery is subject to the provisions of clause (c) below), when delivered;
provided, however, that notices and other communications to the Administrative
Agent and the L/C Issuer pursuant to Section 1 shall not be effective
until actually received by such Person. 
In no event shall a voicemail message be effective as a notice,
communication or confirmation hereunder.

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

(c)           Limited
Use of Electronic Mail.  Electronic mail and Internet and
intranet websites may be used only to distribute routine communications, such
as financial statements and other information as provided in Section 6.01,
and to distribute Credit Documents for execution by the parties thereto, and
may not be used for any other purpose.

(d)           Reliance
by Administrative Agent and the Bank.  The Administrative Agent and the
Banks shall be entitled to rely and act upon any notices (including telephonic
Notices of Borrowing) purportedly given by or on behalf of the Borrower even if
(i) such notices were not made in a manner specified herein, were incomplete or
were not preceded or followed by any other form of notice specified herein, or
(ii) the terms thereof, as understood by the recipient, varied from any
confirmation thereof.  Except as
otherwise provided in Section 3.05(b), the Borrower shall indemnify each
Agent-Related Person and each Bank from all losses, costs, expenses and
liabilities resulting from the reliance by such Person on each notice
purportedly given by or on behalf of the Borrower.  All telephonic notices to and other
communications with the Administrative Agent may be recorded by the
Administrative Agent, and each of the parties hereto hereby consents to such
recording.

 71
 

11.04       Benefit of Agreement.

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

(b)           Any Bank may at any
time assign to one or more Eligible Assignees all or a portion of its rights
and obligations under this Agreement (including all or a portion of its
Commitment and the Loans (including for purposes of this clause (b),
participations in L/C Obligations) at the time owing to it); provided that (i)
except in the case of an assignment of the entire remaining amount of the
assigning Bank’s Commitment and the Loans at the time owing to it or in the
case of an assignment to a Bank or an Affiliate of a Bank or an Approved Fund
with respect to a Bank, the aggregate amount subject to each such assignment,
determined as of the date the Assignment and Assumption with respect to such
assignment is delivered to the Administrative Agent or, if “Trade Date” is
specified in the Assignment and Assumption, as of the Trade Date, shall not be
less than $1,000,000unless each of
the Administrative Agent and, so long as no Event of Default has occurred and
is continuing, the Borrower otherwise consents (each such consent not to be
unreasonably withheld or delayed); (ii) each partial assignment shall be made
as an assignment of a proportionate part of all the assigning Bank’s rights and
obligations under this Agreement with respect to the Loans or the Commitment
assigned; and (iii) the parties to each assignment shall execute and deliver to
the Administrative Agent an Assignment and Assumption Agreement substantially in the form of Exhibit H,
appropriately completed, (the “Assignment and Assumption Agreement”),
together with a processing and recordation fee of $3,500 (unless waived by the
Administrative Agent in its sole discretion). 
Subject to acceptance and recording thereof by the Administrative Agent
pursuant to Section 6.12, from and after the effective date specified in
each Assignment and Assumption, the Eligible Assignee thereunder shall be a
party to this Agreement and, to the extent of the interest assigned by such
Assignment and Assumption, have the rights and obligations of a Bank under this
Agreement, and the assigning Bank thereunder shall, to the extent of the
interest assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Bank’s rights and obligations under
this Agreement, such Bank shall cease to be a party hereto but shall continue
to be entitled to the benefits of Sections 1.11, 1.12, 3.05 and 11.01 with
respect to facts and circumstances occurring prior to the effective date of
such assignment).  Upon request, the
Borrower shall execute and deliver one or more new Notes to the assignee
Bank.  Any assignment or transfer by a
Bank of rights or obligations under this Agreement that does not comply with
this subsection shall be treated for purposes of this Agreement as a sale by
such Bank of a participation in such rights and obligations in accordance with
clause (c) of this Section.

(c)           Any Bank may at any
time, without the consent of, or notice to, the Borrower or the Administrative
Agent, sell participations to any Person (other than a natural person or the
Borrower or any of the Borrower’s Affiliates or Subsidiaries) (each, a “Participant”)
in all or a

 72
 

portion of such Bank’s
rights and/or obligations under this Agreement (including all or a portion of
its Commitment and/or the Loans (including such Bank’s participations in L/C
Obligations) owing to it); provided that (i) such Bank’s obligations under
this Agreement shall remain unchanged, (ii) such Bank shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (iii) the Borrower, the Administrative Agent and the other Banks shall
continue to deal solely and directly with such Bank in connection with such
Bank’s rights and obligations under this Agreement.  Any agreement or instrument pursuant to which
a Bank sells such a participation shall provide that such Bank shall retain the
sole right to enforce this Agreement and to approve any amendment, modification
or waiver of any provision of this Agreement; provided that such agreement or
instrument may provide that such Bank will not, without the consent of the
Participant, agree to any amendment, waiver or other modification described in
the first proviso to Section 11.13 that directly affects such Participant.  Subject to clause (d) of this Section, the
Borrower agrees that each Participant shall be entitled to the benefits of
Sections 1.11, 1.12 and 3.05to the same
extent as if it were a Bank and had acquired its interest by assignment
pursuant to clause (b) of this Section; provided that no Participant shall be
entitled to compensation at a greater rate pursuant to any such
Section than the Bank that sold such Participant its participation, unless
the Borrower has consented to such participation.  To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 11.02as though it were a Bank, provided such Participant agrees
to be subject to Section 11.06(b) as though it were a Bank.  In addition, each Bank that transfers or
grants any participation to a participant under this Section 11.04(c)
shall (i) keep a register, meeting the requirements of U.S. Treasury Regulation
Section 5f.163-1(c), relating to each such Participant, specifying such
Participant’s entitlement to payments of principal and interest with respect to
such participation, and (ii) collect prior to the time such Participant
receives payments with respect to such participation, from each such
Participant the appropriate forms, certificates and statements described in
Section 3.05(e) (and updated as required) as if such Participant were a
Bank under Section 3.05.

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

(e)           Notwithstanding
anything to the contrary contained herein, if at any time Bank of America
assigns all of its rights and obligations under this Agreement pursuant to
clause (b) above, Bank of America may, upon 30 days’ notice to the Borrower and the Banks, resign as the L/C
Issuer.  In the event of any such
resignation as the L/C Issuer, the Borrower shall be entitled to appoint from
among the Banks a successor L/C Issuer hereunder; provided, however, that no
failure by the Borrower to appoint any such successor shall affect the
resignation of Bank of America as the L/C Issuer.  If Bank of America resigns as the L/C Issuer,
it shall retain all the rights and obligations of the L/C Issuer hereunder with
respect to all Letters of Credit outstanding as of the effective date of its
resignation as the L/C Issuer and all L/C Obligations with respect thereto
(including the right to require the Banks to make Base Rate Loans or fund risk
participations in Unreimbursed Amounts pursuant to Section 1.07(c)).

(f)            Notwithstanding any other provisions of this
Section 11.04, no transfer or assignment of the interests or obligations
of any Bank hereunder or any grant of participations therein shall be permitted
if such transfer, assignment or grant would require the Borrower to file a
registration statement with the SEC or to qualify the Loans under the “Blue Sky”
laws of any state.

 73
 

(g)           Each Bank initially party to this Agreement hereby represents, and each
Person that becomes a Bank pursuant to an assignment permitted by
clause (b) above will upon its becoming party to this Agreement represent,
that it is a commercial lender, other financial institution or other “accredited
investor” (as defined in SEC Regulation D) which makes loans in the ordinary
course of its business or is acquiring the Loans without a view to distribution
of the Loans within the meaning of the federal securities laws, and that it
will make or acquire Loans for its own account in the ordinary course of such
business, provided that, subject to the preceding clauses (a) through (d), the
disposition of any promissory notes or other evidences of or interests in
Indebtedness held by such Bank shall at all times be within its exclusive
control.

11.05       No Waiver; Remedies
Cumulative.  No failure or delay on the
part of the Administrative Agent or any Bank in exercising any right, power or
privilege hereunder or under any other Credit Document and no course of dealing
between any Credit Party and the Administrative Agent or any Bank shall operate
as a waiver thereof; nor shall any single or partial exercise of any right,
power or privilege hereunder or under any other Credit Document preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege hereunder or thereunder.  The
rights and remedies herein expressly provided are cumulative and not exclusive
of any rights or remedies which the Administrative Agent or any Bank would
otherwise have.  No notice to or demand
on the Borrower in any case shall entitle the Borrower to any other or further
notice or demand in similar or other circumstances or constitute a waiver of
the rights of the Administrative Agent or the Banks to any other or further
action in any circumstances without notice or demand.

11.06       Payments Pro Rata.

(a)           The Administrative Agent agrees that promptly after its receipt of each
payment from or on behalf of the Borrower in respect of any Obligations of the
Borrower, it shall distribute such payment to the Banks (other than any Bank
that has consented in writing to waive its pro rata share of such payment) pro
rata based upon their respective shares, if any, of the Obligations with
respect to which such payment was received.

(b)           Each of the Banks agrees that, if it should receive any amount hereunder
(whether by voluntary payment, by realization upon security, by the exercise of
the right of setoff or banker’s lien, by counterclaim or cross action, by the
enforcement of any right under the Credit Documents, or otherwise) which is
applicable to the payment of the principal of, or interest on, the Loans, Fees
or the L/C Obligations held by it, of a sum which with respect to the related
sum or sums received by other Banks is in a greater proportion than the total
of such Obligation then owed and due to such Bank bears to the total of such
Obligation then owed and due to all of the Banks immediately prior to such
receipt, then such Bank receiving such excess payment shall (i) purchase for
cash without recourse or warranty from the other Banks an interest in the
Obligations of the Borrower to such Banks in such amount as shall result in a
proportional participation by all of the Banks in such amount, provided that if
all or any portion of such excess amount is thereafter recovered from such
Bank, such purchase shall be rescinded and the purchase price restored to the
extent of such recovery, but without interest, or (ii) otherwise share such
excess payment with the other Banks so that all of the Banks share in such
excess payment on a pro rata basis.

(c)           Notwithstanding anything to the contrary contained herein, the
provisions of the preceding Sections 11.06(a) and (b) shall be subject to
the express provisions of this Agreement which require, or permit, differing
payments to be made to Non-Defaulting Banks as opposed to Defaulting Banks.

 74
 

11.07       Payments Set Aside.  To the extent that any payment by or on
behalf of the Borrower is made to the Administrative Agent or any Bank, or the
Administrative Agent or any Bank exercises its right of set-off, and such
payment or the proceeds of such set-off or any part thereof is subsequently
invalidated, declared to be fraudulent or preferential, set aside or required
(including pursuant to any settlement entered into by the Administrative Agent
or such Bank in its discretion) to be repaid to a trustee, receiver or any
other party, in connection with any proceeding under the Bankruptcy Code or
other debtor relief laws, then (a) to the extent of such recovery, the
obligation or part thereof originally intended to be satisfied shall be revived
and continued in full force and effect as if such payment had not been made or
such set-off had not occurred, and (b) each Bank severally agrees to pay to the
Administrative Agent upon demand its applicable share of any amount so
recovered from or repaid by the Administrative Agent, plus interest thereon
from the date of such demand to the date such payment is made at a rate per
annum equal to the Federal Funds Rate from time to time in effect.

11.08       Calculations; Computations.

(a)           The financial statements to be furnished to the Banks pursuant hereto
shall be made and prepared in accordance with GAAP or SAP, as the case may be,
consistently applied throughout the periods involved (except as set forth in
the notes thereto or as otherwise disclosed in writing by the Borrower to the
Banks).  In addition, except as otherwise
specifically provided herein, all computations determining compliance with
Section 7, including definitions used therein, shall utilize accounting
principles and policies in effect from time to time; provided that (i) if any
such accounting principle or policy (whether GAAP or SAP or both) shall change
after the Effective Date, the Borrower shall give reasonable notice thereof to
the Administrative Agent and each of the Banks and if within 30 days following
such notice the Borrower, the Administrative Agent or the Required Banks shall
elect by giving written notice of such election to the other parties hereto,
such computations shall not give effect to such change unless and until this
Agreement shall be amended pursuant to Section 11.13 to give effect to
such change, and (ii) if at any time the computations determining compliance
with Section 7 utilize accounting principles different from those utilized
in the financial statements then being furnished to the Banks pursuant to
Section 6.01, such financial statements shall be accompanied by
reconciliation work-sheets.

(b)           All computations of interest on Eurodollar Loans and Fees hereunder
shall be made on the actual number of days elapsed over a year of 360 days.

(c)           All computations of interest on Base Rate Loans hereunder shall be made
on the actual number of days elapsed over a year of 365/366 days.

11.09       GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE.

(a)           THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE CONSTRUED IN
ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK.  ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO
THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE
STATE OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW
YORK, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF THE PARTIES
HERETO HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY,
GENERALLY AND UNCONDITIONALLY, THE NON-EXCLUSIVE JURISDICTION OF

 75
 

THE AFORESAID COURTS.  EACH OF THE PARTIES HERETO HEREBY FURTHER
IRREVOCABLY WAIVES ANY CLAIM THAT ANY SUCH COURTS LACK JURISDICTION OVER SUCH
CREDIT PARTY, AND AGREES NOT TO PLEAD OR CLAIM, IN ANY LEGAL ACTION OR
PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT BROUGHT
IN ANY OF THE AFORESAID COURTS, THAT ANY SUCH COURT LACKS JURISDICTION OVER
SUCH CREDIT PARTY.  EACH OF THE PARTIES
HERETO FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE
AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES
THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO SUCH PARTY AT ITS
ADDRESS FOR NOTICES PURSUANT TO SECTION 11.03, SUCH SERVICE TO BECOME
EFFECTIVE 30 DAYS AFTER SUCH MAILING.  EACH
OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY OBJECTION TO SUCH SERVICE
OF PROCESS AND FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN
ANY ACTION OR PROCEEDING HEREUNDER OR UNDER ANY OTHER CREDIT DOCUMENT THAT
SERVICE OF PROCESS WAS IN ANY WAY INVALID OR INEFFECTIVE.  NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE
PARTIES HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO
COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST ANY OF THE OTHER
PARTIES HERETO IN ANY OTHER JURISDICTION.

(b)           EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH
IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID
ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR
ANY OTHER CREDIT DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (A)
ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN
ANY SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS
BEEN BROUGHT IN AN INCONVENIENT FORUM.

11.10       Counterparts.  This Agreement may be executed in any number
of counterparts and by the different parties hereto on separate counterparts,
each of which when so executed and delivered shall be an original, but all of
which shall together constitute one and the same instrument.  A set of counterparts executed by all the
parties hereto shall be lodged with the Borrower and the Administrative Agent.

11.11       Effectiveness.  This Agreement shall become effective on the
date (the “Effective Date”) on which the Borrower and each of the Banks shall
have signed a copy hereof (whether the same or different copies) and shall have
delivered the same to the Administrative Agent at the Administrative Agent’s
Notice Office or, in the case of the Banks, shall have given to the
Administrative Agent telephonic (confirmed in writing), written, telex or
telecopy notice (actually received) at such office that the same has been
signed and mailed to it.  The
Administrative Agent will give the Borrower and each Bank prompt written notice
of the occurrence of the Effective Date.

11.12       Headings Descriptive.  The headings of the several Sections and
sub-Sections of this Agreement are inserted for convenience only and shall
not in any way affect the meaning or construction of any provision of this
Agreement.

11.13       Amendment or Waiver.  No amendment or waiver of any provision of
this Agreement or any other Credit Document or any other Loan Document, and no
consent to any departure by the Borrower or any other Credit Party therefrom,
shall be effective unless in writing signed by the Required

 76
 

Banks and the Borrower or
the applicable Credit Party, as the case may be, and acknowledged by the
Administrative Agent, and each such waiver or consent shall be effective only
in the specific instance and for the specific purpose for which given;
provided, however, that no such amendment, waiver or consent shall:

(a)           Extend
or increase the Commitment of any Bank (or reinstate any Commitment terminated
pursuant to Section 8.10) without the written consent of such Bank;

(b)           Postpone
any date fixed by this Agreement or any other Credit Document for any payment
or mandatory prepayment of principal, interest, fees or other amounts due to
the Banks (or any of them) hereunder or under any other Credit Document without
the written consent of each Bank directly affected thereby;

(c)           Reduce the
principal of, or the rate of interest specified herein on, any Loan or L/C
Borrowing, or (subject to clause (iv)
of the second proviso to this Section 11.13) any fees or other amounts
payable hereunder or under any other Credit Document without the written
consent of each Bank directly affected thereby; provided, however, that only
the consent of the Required Banks shall be necessary to amend any financial
covenant hereunder (or any defined term used therein) even if the effect of
such amendment would be to reduce the rate of interest on any Loan or L/C
Borrowing or to reduce any fee payable hereunder;

(d)           Change
Section 8.11 or Section 11.06 in a manner that would alter the pro
rata sharing of payments required thereby without the written consent of each
Bank;

(e)           Change
any provision of this Section or the definition of “Required Banks” or any
other provision hereof specifying the number or percentage of Banks required to
amend, waive or otherwise modify any rights hereunder or make any determination
or grant any consent hereunder, without the written consent of each Bank;

(f)            Release any Subsidiary Guarantor from the
Subsidiary Guaranty without the written consent of each Bank; or

(g)           Permit the assignment or transfer by the
Borrower of any of its rights and obligations under this Agreement without the
written consent of each Bank;

and, provided further,
that (i) no amendment, waiver or consent shall, unless in writing and signed by
the L/C Issuer in addition to the Banks required above, affect the rights or
duties of the L/C Issuer under this Agreement or any Letter of Credit
Application relating to any Letter of Credit issued or to be issued by it; (ii)
no amendment, waiver or consent shall, unless in writing and signed by the
Administrative Agent in addition to the Banks required above, affect the rights
or duties of the Administrative Agent under this Agreement or any other Credit
Document; and (iii)the Fee
Letter may be amended, or rights or privileges thereunder waived, in a writing
executed only by the parties thereto. 
Notwithstanding anything to the contrary herein, no Defaulting Bank
shall have any right to approve or disapprove any amendment, waiver or consent
hereunder, except that the Commitment of such Bank may not be increased or
extended without the consent of such Bank. 
For purposes of this Agreement and the other Credit Documents, a Default
or an Event of Default that has been waived in writing in accordance with this
Section 11.13 shall no longer be deemed continuing, unless such written
waiver expressly provides otherwise.

 77
 

11.14       Survival.

(a)           All
indemnities set forth herein including, without limitation, in
Section 1.11, 1.12, 3.05, 10.07 or 11.01(b) shall survive the execution
and delivery of this Agreement and the making of the Loans, the repayment of
the Obligations, the termination of the Total Commitment and the expiration or
termination of all Letters of Credit.

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

11.15       Domicile of Loans.  Subject to Section 11.04, each Bank may
transfer and carry its Loans at, to or for the account of any branch office,
subsidiary or affiliate of such Bank; provided that the Borrower shall not be
responsible for costs arising under Section 1.11 or 3.05 resulting from
any such transfer to the extent not otherwise applicable to such Bank prior to
such transfer; and provided further that, in the case of any transfer to a
subsidiary or affiliate of such Bank, the transferring Bank shall maintain a
register as provided in Section 11.04(c).

11.16       Interest Rate
Limitations.  Notwithstanding anything to
the contrary contained in any Credit Document, the interest paid or agreed to
be paid under the Credit Documents shall not exceed the maximum rate of
non-usurious interest permitted by applicable law (the “Maximum Rate”).  If the Administrative Agent or any Bank shall
receive interest in an amount that exceeds the Maximum Rate, the excess
interest shall be applied to the principal of the Loans or, if it exceeds such
unpaid principal, refunded to the Borrower. 
In determining whether the interest contracted for, charged, or received
by the Administrative Agent or a Bank exceeds the Maximum Rate, such Person
may, to the extent permitted by applicable law, (a) characterize any payment
that is not principal as an expense, fee, or premium rather than interest, (b)
exclude voluntary prepayments and the effects thereof, and (c) amortize,
prorate, allocate, and spread in equal or unequal parts the total amount of
interest throughout the contemplated term of the Obligations hereunder.

11.17       Confidentiality.  Each of the Administrative Agent and the
Banks agrees to maintain the confidentiality of the Information (as defined
below), except that Information may be disclosed (a) to its and its
Affiliates’ directors, officers, employees and agents, including accountants,
legal counsel and other advisors (it being understood that the Persons to whom
such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential); (b) to
the extent requested by any regulatory authority; (c) to the extent
required by applicable laws or regulations or by any subpoena or similar legal
process; (d) to any other party to this Agreement; (e) in connection with the
exercise of any remedies hereunder or any suit, action or proceeding relating
to this Agreement or the enforcement of rights hereunder; (f) subject to an
agreement containing provisions substantially the same as those of this
Section, to (i) any Eligible Assignee of or Participant in, or any prospective
Eligible Assignee of or Participant in, any of its rights or obligations under
this Agreement or (ii) any direct or indirect contractual counterparty or
prospective counterparty (or such contractual counterparty’s or prospective
counterparty’s professional advisor) to any credit derivative transaction
relating to obligations of the Credit Parties; (g) with the consent of the
Borrower; (h) to the extent such Information (i) becomes publicly available
other than as a result of a breach of this Section or (ii) becomes
available to the Administrative Agent or any Bank on a nonconfidential basis
from a source other than the Borrower; or (i) to the National Association of
Insurance Commissioners or any other

 78
 

similar
organization.  In addition, the
Administrative Agent and the Banks may disclose the existence of this Agreement
and information about this Agreement to market data collectors, similar service
providers to the lending industry, and service providers to the Administrative
Agent and the Banks in connection with the administration and management of
this Agreement, the other Credit Documents, the Commitments, and the Credit
Extensions.  For the purposes of this
Section, “Information” means all information received from any Credit Party
relating to any Credit Party or its business, other than any such information
that is available to the Administrative Agent or any Bank on a nonconfidential
basis prior to disclosure by any Credit Party; provided that, in the case of
information received from a Credit Party after the date hereof, such information
is clearly identified in writing at the time of delivery as confidential.  Any Person required to maintain the
confidentiality of Information as provided in this Section shall be
considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.

11.18       WAIVER OF JURY TRIAL.  EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY
WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF
ACTION ARISING UNDER ANY CREDIT DOCUMENT OR IN ANY WAY CONNECTED WITH OR
RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH
RESPECT TO ANY CREDIT DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH
CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT
OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL
WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE
CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY
JURY.

11.19       Severability.  If any provision of Agreement or the other
Credit Documents is held to be illegal, invalid or unenforceable, (a) the
legality, validity and enforceability of the remaining provisions of this
Agreement and the other Credit Documents shall not be affected or impaired
thereby and (b) the parties shall endeavor in good faith negotiations to
replace the illegal, invalid or unenforceable provisions with valid provisions
the economic effect of which comes as close as possible to that of the illegal,
invalid or unenforceable provisions.  The
invalidity of a provision in a particular jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.

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

11.21       Entire Agreement.  This Agreement, together with the other
Credit Documents, comprises the complete and integrated agreement of the
parties on the subject matter hereof and thereof and supersedes all prior
agreements, written or oral, on such subject matter.  In the event of any conflict between the
provisions of this Agreement and those of any other Credit Document, the
provisions of this Agreement shall control; provided that the inclusion of
supplemental rights or remedies in favor of the Administrative Agent, the L/C Issuer
or the Banks in any other Credit Document shall not be deemed a conflict with
this Agreement.  Each Credit Document was
drafted with the joint participation of the respective parties thereto and
shall be construed neither against nor in favor of any party, but rather in
accordance with the fair meaning thereof. 
THIS AGREEMENT AND THE OTHER CREDIT

 79
 

DOCUMENTS REPRESENT THE
FINAL AGREEMENT AMONG THE ADMINISTRATIVE AGENT, THE L/C ISSUER, THE BANKS AND
THE CREDIT PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF SUCH PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG
SUCH PARTIES.

[Remainder of page intentionally blank.

Signature pages follow.]

 80

 

	
   

  	
  UNIVERSAL AMERICAN FINANCIAL CORP., as

  Borrower

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert A. Waegelein

  
	
   

  	
   

  	
  Name:

  	
  Robert A. Waegelein

  
	
   

  	
   

  	
  Title:

  	
  Executive Vice President and Chief Financial Officer

  

 

Signature
Page to Credit Agreement

 

	
   

  	
  BANK OF AMERICA, N.A.,
  as a Bank and as the

  Administrative Agent and the L/C Issuer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Joseph L. Corah

  
	
   

  	
   

  	
  Name:

  	
  Joseph L. Corah

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President

  

 

Signature
Page to Credit Agreement

EXHIBIT A

FORM OF NOTICE OF BORROWING

[Date]

Bank of America, N.A.,

as Administrative Agent for the Banks party
to the Credit Agreement referred to below

2001 Clayton Road, Building B

Mail Code: CA4-702-02-25

Concord,
CA 94520

	
  Attention:

  	
  Arthur K. Khoo

  
	
   

  	
  Facsimile: (888) 203-0618

  
	
   

  	
  Email: arthur.k.khoo@bankofamerica.com

  

Ladies and Gentlemen:

The undersigned, Universal American Financial Corp., a New York
corporation (the “Borrower”), refers to the Credit Agreement, dated as of January
18, 2007 (as amended, modified or supplemented from time to time, the “Credit
Agreement,” the terms defined therein being used herein as therein defined),
among the undersigned, certain Banks from time to time party thereto, and you,
as Administrative Agent for such Banks, and hereby gives you notice,
irrevocably pursuant to Section 1.03(a) of the Credit Agreement, that the
undersigned hereby requests a Borrowing under the Credit Agreement, and in that
connection sets forth below the information relating to such Borrowing (the “Proposed
Borrowing”) as required by Section 1.03(a) of the Credit Agreement.

(i)            The Business Day of the Proposed Borrowing is
          ,           .(1)

(ii)           The aggregate principal amount of the Proposed Borrowing is $                 .(2)

(iii)          The Proposed Borrowing is
to consist of [Base Rate Loans] [Eurodollar Loans].

[(iv)         The initial Interest
Period for the Proposed Borrowing is              
month(s).](3)

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

(A)          the representations and
warranties contained in the Credit Agreement or in the other Credit Documents
are true and correct in all material respects, both before and after giving
effect to the Proposed Borrowing and to the application of the proceeds
thereof, as though made on and as of such date, unless stated to relate to a
specific earlier date, in which case such 

(1)           Shall be a Business Day at least one Business
Day in the case of Base Rate Loans and three Business Days in the case of
Eurodollar Loans, in each case, after the date hereof.

(2)           Shall (i) not be less
than $1,000,000 and, if in excess thereof, shall be in an integral multiple of
$500,000, or (ii) in the case of a Proposed Borrowing of Revolving Loans
constituting Base Rate Loans, be equal to the Total Unutilized Revolving Loan
Commitment.

(3)           To be included for a
Proposed Borrowing of Eurodollar Loans and shall specify an Interest Period of
one, two or three months.

 1
 

representations and warranties were true and
correct in all material respects as of such earlier date; and 

(B)           no Default or Event of
Default has occurred and is continuing, or would result from such Proposed
Borrowing or from the application of the proceeds thereof.

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  UNIVERSAL AMERICAN FINANCIAL CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	 

	
   

  	
   

  	
  Title:

  	
   

  	
   

  

 

 2

EXHIBIT B

FORM OF REVOLVING NOTE

	
  $                     

  	
  New York, New York

  	
                      ,
  200   

  

 

FOR VALUE RECEIVED, UNIVERSAL AMERICAN FINANCIAL CORP., a New York
corporation (the “Borrower”), hereby promises to pay to the order of                   
or its registered assigns (the “Bank”), in lawful money of the United States of
America in immediately available funds, at the Administrative Agent’s Payment
Office (as defined in the Agreement referred to below) initially located at
2001 Clayton Road, Building B, Mail Code: CA4-702-02-25, Concord, CA 94520, on
the Revolving Loan Maturity Date (as defined in the Agreement referred to
below) the principal sum of                  
                   
DOLLARS ($             )
or, if less, the then unpaid principal amount of all Revolving Loans (as
defined in the Agreement) made by the Bank pursuant to the Agreement.

The Borrower also promises to pay interest on the unpaid principal
amount hereof in like money at said office from the date hereof until paid at
the rates and at the times provided in Section 1.09 of the Agreement.

This Note is one of the Revolving Notes referred to in the Credit
Agreement, dated as of January 18, 2007, among the undersigned, as Borrower,
the financial institutions from time to time party thereto (including the
Bank), and Bank of America, N.A.., as Administrative Agent (as amended,
modified or supplemented from time to time, the “Agreement”) and is entitled to
the benefits thereof and of the other Credit Documents (as defined in the
Agreement). As provided in the Agreement, this Note is subject to voluntary
prepayment and mandatory prepayment and repayment, in whole or in part.

In case an Event of Default (as defined in the Agreement) shall occur
and be continuing, the principal of and accrued interest on this Note may
become or be declared to be due and payable in the manner and with the effect
provided in the Agreement.

The Borrower hereby waives presentment, demand, protest or notice of
any kind in connection with this Note.

THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE
GOVERNED BY THE LAW OF THE STATE OF NEW YORK.

	
   

  	
  UNIVERSAL AMERICAN FINANCIAL
  CORP.

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	 

	
   

  	
   

  	
  Title:

  	
   

  	
   

  
							

 

 1

EXHIBIT C

[INTENTIONALLY OMITTED]

 1

EXHIBIT D

FORM OF OFFICERS’ CERTIFICATE

I, the undersigned, [President/Vice President] of            ,
a           organized and existing
under the laws of the State of             
(the “Company”), do hereby certify on behalf of the Company that:

1.             This Certificate is
furnished pursuant to Section [4.03](1) and 4.05 of the Credit Agreement,
dated as of January 18, 2007, among [the Company] [Universal American Financial
Corp.], the lending institutions from time to time party thereto, and Bank of
America, N.A., as Administrative Agent (such Credit Agreement, as in effect on
the date of this Certificate, being herein called the “Credit Agreement”).  Unless otherwise defined herein, capitalized
terms used in this Certificate shall have the meanings set forth in the Credit
Agreement.

2.             The following named
individuals are elected officers of the Company, each holds the office of the
Company set forth opposite his or her name and has held such office since          ,
    (2).  The
signature written opposite the name and title of each such officer is his or
her genuine signature.

	
  Name(3)

  	
   

  	
  Office

  	
   

  	
  Signature

  
	
               

  	
   

  	
               

  	
   

  	
               

  
	
               

  	
   

  	
               

  	
   

  	
               

  
	
               

  	
   

  	
               

  	
   

  	
               

  

 

3.             Attached hereto as
Exhibit A is a certified copy of the [Certificate or Articles of
Incorporation], [Certificate or Articles of Formation] [Certificate of Limited
Partnership] of the Company as filed in the Office of the Secretary of State of
the State of            on         ,
    , together with all amendments thereto adopted through
the date hereof.

4.             Attached hereto as
Exhibit B is a true and correct copy of the current By-Laws of the Company,
which were duly adopted and are in full force and effect on the date hereof.

5.             Attached hereto as
Exhibit C is a true and correct copy of resolutions which were duly adopted on           ,
     [by unanimous written consent of the Board of
Directors or other governing body of the Company) [by a meeting of the Board of
Directors or other governing body of the Company at which a quorum was present
and acting throughout], and said resolutions have not been rescinded, amended
or modified. Except as attached hereto as Exhibit C, no resolutions have been
adopted by the Board of Directors or other governing body of the Company which
deal with the execution, delivery or performance of any of the Credit Documents
to which the Company is party.

[6.]          On the date hereof, all of the applicable
conditions set forth in Sections 4.02, 4.06, 4.07, 4.12, and 4.15 of the Credit
Agreement have been satisfied.

[6.][7.]         On the date hereof, the
representations and warranties contained in the Credit Agreement or in the
other Credit Documents are true and correct in all material respects with the
same effect as though 

(1)           Insert in Officer’s
Certificate of the Borrower only.

(2)           Insert a date on or
prior to the time of any corporate action relating to the Credit Documents or
related documentation.

(3)           Include
name, office and signature of each officer who will sign any Credit Document,
including the officer who will sign the certification at the end of this
Certificate or related documentation.

 1
 

such representations and
warranties had been made on the date hereof, both before and after giving
effect to the incurrence of Credit Extensions on the date hereof and the
application of the proceeds thereof, unless stated to relate to a specific
earlier date, in which case such representations and warranties were true and
correct in all material respects as of such earlier date.

[7][8.]      On the date hereof, no Default or Event of Default has
occurred and is continuing or would result from the Credit Extensions to occur
on the date hereof or from the application of the proceeds thereof.

[8][9.]      There is no proceeding for the dissolution or liquidation
of the Company or threatening its existence.

IN WITNESS WHEREOF, I have hereunto set my hand
this      day of           ,
200  .

	
  

  	
  [Name of Credit Party]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  	 

	
   

  	
   

  	
  Title:

  	
   

  	
   

  	 

 2
 

I, the undersigned, [Secretary/Assistant Secretary]
of the Company, do hereby certify on behalf of the Company that:

[Name of Person making above certifications] is the
duly elected and qualified [President/Vice President] of the Company and the
signature above is his or her genuine signature.

IN WITNESS WHEREOF, I have hereunto set my hand
this         day of          ,
200  .

	
   

  	
  [Name of Credit Party]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  

 

 3

EXHIBIT E

FORM OF SECTION 3.05(e)(ii) CERTIFICATE

Reference
is hereby made to the Credit Agreement, dated as of January 18, 2007, among
Universal American Financial Corp., the lending institutions from time to time
party thereto and Bank of America, N.A., as Administrative Agent (as amended,
modified or supplemented from time to time, the “Credit Agreement”).  Pursuant to the provisions of
Section 3.05(e)(ii) of the Credit Agreement, the undersigned hereby
certifies that it is not a “bank” as such term is used in
Section 881(c)(3)(A) of the Internal Revenue Code of 1986, as amended.

	
  

  	
  [NAME OF BANK]

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
   

  	
   

  	 

	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  	 

	
   

  	
   

  	
   

  	
   

  	
   

  	 

	
  Date:               
      , 20  

  	
   

  	
   

  	
   

  	
   

  	 

 

 1

EXHIBIT F

FORM OF SUBSIDIARY GUARANTY

GUARANTY, dated as of January    ,
2007 (as amended, modified or supplemented from time to time, this “Guaranty”),
made by each of the undersigned guarantors (each, a “Guarantor” and, together
with any other entity that becomes a party hereto pursuant to Section 26
hereof or otherwise, the “Guarantors”). 
Except as otherwise defined herein, terms used herein and defined in the
Credit Agreement (as defined below) shall be used herein as therein defined.

W I T N E S S E T H:

WHEREAS, Universal American Financial Corp. (the “Borrower”),
the lending institutions from time to time party thereto (the “Banks”), and
Bank of America, N.A., as Administrative Agent (together with any successor
administrative agent, the “Administrative Agent”) and as L/C Issuer, have
entered into a Credit Agreement, dated as of January 18, 2007 (as amended,
modified or supplemented from time to time, the “Credit Agreement”), providing
for the making of Credit Extensions to the Borrower as contemplated therein
(the Banks, the L/C Issuer and the Administrative Agent are herein called the “Bank
Creditors”);

WHEREAS, the Borrower may from time to time be
party to one or more Interest Rate Agreements and Other Hedging Agreements with
a Bank or an affiliate of a Bank (each such Bank or affiliate, but only so long
as the respective Bank is a Bank under the Credit Agreement, together with such
Bank’s or affiliate’s successors and assigns, collectively, the “Other
Creditors,” and together with the Bank Creditors, are herein called the “Creditors”);

WHEREAS, each Guarantor is a Subsidiary of the
Borrower;

WHEREAS, it is a condition to the making of Credit
Extensions to the Borrower under the Credit Agreement that each Guarantor shall
have executed and delivered this Guaranty; and

WHEREAS, each Guarantor will obtain benefits from
the incurrence of Credit Extensions by the Borrower under the Credit Agreement
and the entering into of Interest Rate Agreements and Other Hedging Agreements
and, accordingly, desires to execute this Guaranty in order to satisfy the
conditions described in the preceding paragraph and to induce the Banks to make
Credit Extensions to the Borrower and the Other Creditors to enter into
Interest Rate Agreements and Other Hedging Agreements with the Borrower;

NOW, THEREFORE, in consideration of the foregoing
and other benefits accruing to each Guarantor, the receipt and sufficiency of
which are hereby acknowledged, each Guarantor hereby makes the following
representations and warranties to the Creditors and hereby covenants and agrees
with each Creditor as follows:

1.             Each Guarantor, jointly
and severally, irrevocably and unconditionally guarantees: (i) to the Bank
Creditors the full and prompt payment when due (whether at the stated maturity,
by acceleration or otherwise) of (x) the principal of and interest on the
Credit Extensions made to the Borrower under the Credit Agreement and (y) all
other obligations (including obligations which, but for the automatic stay
under Section 362(a) of the Bankruptcy
Code, would become due) and liabilities owing by the Borrower to the Bank
Creditors under the Credit Agreement (including, without limitation,
indemnities, Fees and interest thereon) and the other Credit Documents, whether
now existing or hereafter incurred under, arising out of or in connection with
the Credit Agreement or any such other Credit Document and the due performance
and compliance with the terms of the Credit Documents by the Borrower (all such
principal, interest, liabilities and obligations under this clause (i), except
to the extent consisting of obligations or liabilities with respect to 

 1
 

Interest
Rate Agreements and Other Hedging Agreements, being herein collectively called
the “Credit Document Obligations”); and (ii) to each Other Creditor the full
and prompt payment when due (whether at the stated maturity, by acceleration or
otherwise) of all obligations (including obligations which, but for the
automatic stay under Section 362(a) of the Bankruptcy Code, would become
due) and liabilities owing by the Borrower under any Interest Rate Agreements
or Other Hedging Agreements, whether now in existence or hereafter arising, and
the due performance and compliance by the Borrower with all terms, conditions
and agreements contained therein (all such obligations and liabilities being
herein collectively called the “Other Obligations,” and together with the
Credit Document Obligations are herein collectively called the “Guaranteed
Obligations”), provided that the maximum amount payable by each Guarantor
hereunder shall at no time exceed the Maximum Amount (as hereinafter defined)
of such Guarantor.  As used herein, “Maximum
Amount” of any Guarantor means an amount equal to 95% of the amount by which
(i) the present fair saleable value of such Guarantor’s assets exceeds (ii) the
amount reasonably expected to come due in respect of all liabilities
(including, without limitation, contingent liabilities), other than liabilities
(contingent or otherwise) of such Guarantor hereunder, in each case determined
on the Initial Borrowing Date (or, in the case of a Guarantor that becomes a
party hereto pursuant to Section 24 hereof, on the date such Guarantor
becomes a party hereto) or (in either case) on the date any demand is made
under this Guaranty, whichever date results in a higher Maximum Amount.  Subject to the proviso in the second
preceding sentence, each Guarantor understands, agrees and confirms that the
Creditors may enforce this Guaranty up to the full amount of the Guaranteed
Obligations against each Guarantor without proceeding against any other
Guarantor, the Borrower, against any security for the Guaranteed Obligations,
or under any other guaranty covering all or a portion of the Guaranteed
Obligations.  All payments by each
Guarantor under this Guaranty shall be made on the same basis as payments by
the Borrower are made under Sections 3.04 and 3.05 of the Credit Agreement.

2.             Additionally, subject to the Maximum Amount
limitation contained in Section 1 above, each Guarantor, jointly and
severally, unconditionally and irrevocably, guarantees the payment of any and
all Guaranteed Obligations of the Borrower to the Creditors whether or not due
or payable by the Borrower upon the occurrence in respect of the Borrower of
any of the events specified in Section 8.05 of the Credit Agreement, and
unconditionally and irrevocably, jointly and severally, promises to pay such
Guaranteed Obligations to the Creditors, or to their order, on demand, in
lawful money of the United States.

3.             The liability of each Guarantor hereunder is
exclusive and independent of any security for or other guaranty of the
Guaranteed Obligations of the Borrower whether executed by such Guarantor, any
other Guarantor, any other guarantor of the Guaranteed Obligations or by any
other party, and the liability of each Guarantor hereunder shall not be
affected or impaired by (a) any direction as to application of payment by the
Borrower or by any other party, (b) any other continuing or other guaranty,
undertaking or maximum liability of a guarantor or of any other party as to the
Guaranteed Obligations of the Borrower, (c) any payment on or in reduction of
any such other guaranty or undertaking, (d) any dissolution or termination of,
or increase, decrease or change in personnel by, the Borrower or (e) any
payment made to any Creditor on the Guaranteed Obligations which such Creditor
repays the Borrower pursuant to court order in any bankruptcy, reorganization,
arrangement, moratorium or other debtor relief proceeding, and each Guarantor waives
any right to the deferral or modification of its obligations hereunder by
reason of any such proceeding.

4.             The obligations of each Guarantor hereunder
are independent of the obligations of any other Guarantor, any other guarantor
of the Guaranteed Obligations, or the Borrower, and a separate action or
actions may be brought and prosecuted against each Guarantor whether or not
action is brought against any other Guarantor, any other guarantor of the
Guaranteed Obligations, or the Borrower and whether or not any other Guarantor,
any other guarantor of the Guaranteed Obligations, or the Borrower be joined in
any such action or actions. Each Guarantor waives, to the fullest extent
permitted by law, the benefit of any statute of limitations affecting its liability
hereunder or the enforcement thereof. 
Any payment by the Borrower or other 

 2
 

circumstance
which operates to toll any statute of limitations as to the Borrower shall
operate to toll the statute of limitations as to each Guarantor.

5.             Each Guarantor hereby waives (to the fullest
extent permitted by applicable law) notice of acceptance of this Guaranty and
notice of any liability to which it may apply, and waives promptness,
diligence, presentment, demand of payment, protest, notice of dishonor or nonpayment
of any such liability, suit or taking of other action by the Administrative
Agent or any other Creditor against, and any other notice to, any party liable
thereon (including such Guarantor or any other guarantor of the Guaranteed
Obligations, or the Borrower).

6.             Any Creditor may (except as shall be required
by applicable statute and cannot be waived) at any time and from time to time
without the consent of, or notice to, any Guarantor, without incurring
responsibility to such Guarantor, without impairing or releasing the
obligations of such Guarantor hereunder, upon or without any terms or
conditions and in whole or in part:

(a)           change the manner, place or terms of payment of, and/or change or
extend the time of payment of, renew, increase, accelerate or alter, any of the
Guaranteed Obligations, any security therefor, or any liability incurred
directly or indirectly in respect thereof, and the guaranty herein made shall
apply to the Guaranteed Obligations as so changed, extended, renewed or
altered;

(b)           sell, exchange, release, surrender, realize upon or otherwise deal with
in any manner and in any order any property by whomsoever at any time pledged
or mortgaged to secure, or howsoever securing, the Guaranteed Obligations or
any liabilities (including any of those hereunder) incurred directly or
indirectly in respect thereof or hereof, and/or any offset there against;

(c)           exercise or refrain from exercising any rights against the Borrower or
others or otherwise act or refrain from acting;

(d)           settle or compromise any of the Guaranteed Obligations, any security
therefor or any liability (including any of those hereunder) incurred directly
or indirectly in respect thereof or hereof, and may subordinate the payment of
all or any part thereof to the payment of any liability (whether due or not) of
the Borrower to creditors of the Borrower;

(e)           apply any sums by whomsoever paid or howsoever realized to any
liability or liabilities of the Borrower to the Creditors regardless of what
liabilities of the Borrower remain unpaid;

(f)            consent to or waive any breach of, or any
act, omission or default under, any of the Interest Rate Agreements or Other
Hedging Agreements entered into by the Borrower and an Other Creditor, the
Credit Documents or any of the instruments or agreements referred to therein,
or otherwise amend, modify or supplement any of the Interest Rate Agreements or
Other Hedging Agreements entered into by the Borrower and an Other Creditor,
the Credit Documents or any of such other instruments or agreements; and/or

(g)           act or fail to act in any manner referred to in this Guaranty which may
deprive such Guarantor of its right to subrogation against the Borrower to
recover full indemnity for any payments made pursuant to this Guaranty.

7.             No invalidity, irregularity or
unenforceability of all or any part of the Guaranteed Obligations or of any
security therefor shall affect, impair or be a defense to this Guaranty, and
this Guaranty shall be primary, absolute and unconditional notwithstanding the
occurrence of any event or the existence of any other 

 3
 

circumstances
which might constitute a legal or equitable discharge of a surety or guarantor
except payment in full of the Guaranteed Obligations.

8.             This Guaranty is a continuing one and all
liabilities to which it applies or may apply under the terms hereof shall be
conclusively presumed to have been created in reliance hereon. No failure or
delay on the part of any Creditor in exercising any right, power or privilege
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, power or privilege hereunder preclude any other or
further exercise thereof or the exercise of any other right, power or
privilege.  The rights and remedies herein
expressly specified are cumulative and not exclusive of any rights or remedies
which any Creditor would otherwise have. 
No notice to or demand on any Guarantor in any case shall entitle such
Guarantor to any other further notice or demand in similar or other
circumstances or constitute a waiver of the rights of any Creditor to any other
or further action in any circumstances without notice or demand. It is not
necessary for any Creditor to inquire into the capacity or powers of the
Borrower or any of its Subsidiaries or the officers, directors, partners or
agents acting or purporting to act on its behalf, and any indebtedness made or
created in reliance upon the professed exercise of such powers shall be
guaranteed hereunder.

9.             Any indebtedness of the Borrower now or
hereafter held by any Guarantor is hereby subordinated to the indebtedness of
the Borrower to the Creditors; and such indebtedness of the Borrower to any
Guarantor, if the Administrative Agent, after an Event of Default has occurred
and is continuing, so requests, shall be collected, enforced and received by
such Guarantor as trustee for the Creditors and be paid over to the Creditors
on account of the Guaranteed Obligations, but without affecting or impairing in
any manner the liability of such Guarantor under the other provisions of this
Guaranty.  Prior to the transfer by any
Guarantor of any note or negotiable instrument evidencing any indebtedness of
the Borrower to such Guarantor, such Guarantor shall mark such note or
negotiable instrument with a legend that the same is subject to this
subordination.  Without limiting the
generality of the foregoing, each Guarantor hereby agrees with the Creditors
that it will not exercise any right of subrogation which it may at any time
otherwise have as a result of this Guaranty (whether contractual, under
Section 509 of the Bankruptcy Code or otherwise) until all Guaranteed
Obligations have been irrevocably paid in full in cash.

10.

(a)           Each Guarantor waives any right (except as shall be required by
applicable statute or law and cannot be waived) to require the Creditors to:
(i) proceed against the Borrower, any other Guarantor, any other guarantor of
the Borrower or any other party; (ii) proceed against or exhaust any security
held from the Borrower, any other Guarantor, any other guarantor of the
Borrower or any other party or (iii) pursue any other remedy in the Creditors’
power whatsoever.  Each Guarantor waives
(to the fullest extent permitted by applicable law) any defense based on or
arising out of any defense of the Borrower, any other Guarantor, any other
guarantor of the Borrower or any other party other than payment in full of the
Guaranteed Obligations, including, without limitation, any defense based on or
arising out of the disability of the Borrower, any other Guarantor, any other
guarantor of the Borrower or any other party, or the unenforceability of the
Guaranteed Obligations or any part thereof from any cause, or the cessation
from any cause of the liability of the Borrower other than payment in full of
the Guaranteed Obligations.  The
Creditors may, at their election, foreclose on any security held by the
Administrative Agent or the other Creditors by one or more judicial or
nonjudicial sales, whether or not every aspect of any such sale is commercially
reasonable (to the extent such sale is permitted by applicable law), or
exercise any other right or remedy the Creditors may have against the Borrower
or any other party, or any security, without affecting or impairing in any way
the liability of any Guarantor hereunder except to the extent the Guaranteed
Obligations have been paid in full.  Each
Guarantor waives any defense arising out of any such election by the Creditors,
even though such election operates to impair or extinguish any right of
reimbursement or 

 4
 

subrogation or other right or remedy of such
Guarantor against the Borrower or any other party or any security.

(b)           Each Guarantor waives all presentments, demands for performance,
protests and notices, including, without limitation, notices of nonperformance,
notices of protest, notices of dishonor, notices of acceptance of this
Guaranty, and notices of the existence, creation or incurring of new or
additional indebtedness.  Each Guarantor
assumes all responsibility for being and keeping itself informed of the Borrower’s
financial condition and assets, and of all other circumstances bearing upon the
risk of nonpayment of the Guaranteed Obligations and the nature, scope and
extent of the risks which such Guarantor assumes and incurs hereunder, and
agrees that the Creditors shall have no duty to advise any Guarantor of
information known to them regarding such circumstances or risks.

11.           Each Creditor agrees that this Guaranty may
be enforced only by the action of the Administrative Agent acting upon the
instructions of the Required Banks (or, after the date on which all Credit
Document Obligations have been paid in full, the holders of at least a majority
of the outstanding Other Obligations) and that no other Creditor shall have any
right individually to seek to enforce or to enforce this Guaranty, it being
understood and agreed that such rights and remedies may be exercised by the
Administrative Agent or the holders of at least a majority of the outstanding
Other Obligations, as the case may be, for the benefit of the Creditors in
accordance with the terms of this Guaranty. 
Each Creditor further agrees that this Guaranty may not be enforced
against any director, officer, employee, partner or stockholder of any
Guarantor (except to the extent such stockholder is also a Guarantor
hereunder).

12.           In order to induce the Banks to make Credit
Extensions pursuant to the Credit Agreement, and in order to induce the Other
Creditors to execute, deliver and perform the Interest Rate Agreements and
Other Hedging Agreements, each Guarantor represents, warrants and covenants
that:

(a)           Such Guarantor (i) is a duly organized and validly existing
corporation, limited liability company or partnership, as the case may be, and
is in good standing (to the extent such concept is relevant in such
jurisdiction) under the laws of the jurisdiction of its organization, and has
the corporate, limited liability company or partnership, as the case may be,
power and authority to own its property and assets and to transact the business
in which it is engaged and presently proposes to engage and (ii) is duly
qualified and is authorized to do business and is in good standing in all
jurisdictions where it is required to be so qualified, except where the failure
to be so qualified could not reasonably be expected to have a Material Adverse
Effect.

(b)           Such Guarantor has the corporate, limited liability company or
partnership, as the case may be, power and authority to execute, deliver and
carry out the terms and provisions of this Guaranty and each other Credit
Document to which it is a party and has taken all necessary corporate, limited
liability company or partnership, as the case may be, action to authorize the
execution, delivery and performance by it of each such Credit Document. Such
Guarantor has duly executed and delivered this Guaranty and each other Credit
Document to which it is a party and each such Credit Document constitutes the
legal, valid and binding obligation of such Guarantor enforceable in accordance
with its terms, except to the extent that the enforceability hereof or thereof
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium
or other similar laws affecting creditors’ rights generally and by equitable
principles (regardless of whether enforcement is sought in equity or at law).

(c)           Neither the execution, delivery or performance by such Guarantor of
this Guaranty or any other Credit Document to which it is a party, nor
compliance by it with the terms and provisions hereof or thereof (i) will
contravene any applicable provision of any law, statute, rule or regulation, or

 5
 

any order, writ, injunction or decree of any
court or Governmental Authority, (ii) will conflict or be inconsistent with or
result in any breach of, any of the terms,
covenants, conditions or provisions of, or constitute a default under (except
for those which, individually or in the aggregate, could not reasonably be
expected to have Material Adverse Effect), or result in the creation or
imposition of (or the obligation to create or impose) any Lien upon any of the
property or assets of such Guarantor or any of its Subsidiaries pursuant to the
terms of, any material indenture, mortgage, deed of trust, loan agreement,
credit agreement or other agreement to which such Guarantor or any of its
Subsidiaries is a party or by which it or any of its property or assets is
bound or to which it may be subject or (iii) will violate any provision of the
certificate or articles of incorporation or by-laws (or equivalent
organizational documents) of such Guarantor or any of its Subsidiaries.

(d)           Except for (i) filings
and approvals made or obtained on or prior to the Initial Borrowing Date, and
(ii) those filings or approvals the failure of which to make or obtain, either
individually or in the aggregate, could not reasonably be expected to have Material
Adverse Effect, no order, consent, approval, license, authorization or
validation of, or filing, recording or registration with, or exemption by, any
Governmental Authority, is required to authorize, or is required in connection
with, (i) the execution, delivery and performance of this Guaranty or any other
Credit Document to which such Guarantor is a party, or (ii) the legality,
validity, binding effect or enforceability of this Guaranty or any other Credit
Document to which such Guarantor is a party (other than any such consent,
approval, license, authorization, validation, filing or registration required
in order for such Guarantor to be in compliance with the Credit Agreement,
which such Guarantor will make or obtain when and as required).

(e)           Except as disclosed on
Schedule 5.04 to the Credit Agreement, there are no actions, suits or
proceedings pending or, to the knowledge of any Responsible Officer of such
Guarantor, threatened with respect to such Guarantor which, individually or in
the aggregate, could (if adversely determined) reasonably be expected to have a
Material Adverse Effect.

13.           Each Guarantor covenants and agrees that on and
after the date hereof and until the termination of the Total Commitment and all
Interest Rate Agreements and Other Hedging Agreements and when no Credit
Extension remains outstanding and all Guaranteed Obligations have been paid in
full (other than indemnities described in Section 11.14 of the Credit
Agreement which are not then due and payable), such Guarantor shall take, or
will refrain from taking, as the case may be, all actions that are necessary to
be taken or not taken so that no violation of any provision, covenant or
agreement contained in Section 6 or 7 of the Credit Agreement, and so that
no Event of Default, is caused by the actions of such Guarantor or any of its
Subsidiaries.

14.           The Guarantors hereby jointly and severally agree
to pay all reasonable out-of-pocket costs and expenses of each Creditor in
connection with the enforcement of this Guaranty, and of the Administrative
Agent in connection with any amendment, waiver or consent relating hereto
(including, without limitation, the reasonable fees and disbursements of
counsel employed by any of the Creditors or the Administrative Agent, as the
case may be).

15.           This Guaranty shall be binding upon each Guarantor
and its successors and assigns and shall inure to the benefit of the Creditors
and their successors and assigns.

16.           Neither this Guaranty nor any provision hereof may
be changed, waived, discharged or terminated except with the written consent of
each Guarantor directly affected thereby and either (x) the Required Banks (or
to the extent required by Section 11.13 of the Credit Agreement, the
written consent of each Bank) at all times prior to the time on which all
Credit Document Obligations have been paid in

 6
 

full or (y) the holders of at least a majority of the
outstanding Other Obligations at all times after the time on which all Credit
Document Obligations have been paid in full; provided, that any change, waiver,
modification or variance affecting the rights and benefits of a single Class
(as defined below) of Creditors (and not all Creditors in a like or similar
manner) shall require the written consent of the Requisite Creditors (as
defined below) of such Class of Creditors (it being understood that the
addition or release of any Guarantor hereunder shall not constitute a change,
waiver, discharge or termination affecting any Guarantor other than the Guarantor
so added or released). For the purpose of this Guaranty the term “Class” shall
mean each class of Creditors, i.e., whether (x) the Bank Creditors as holders
of the Credit Document Obligations or (y) the Other Creditors as the holders of
the Other Obligations. For the purpose of this Guaranty, the term “Requisite
Creditors” of any Class shall mean each of (x) with respect to the Credit
Document Obligations, the Required Banks (or all the Banks if required by
Section 11.13 of the Credit Agreement) and (y) with respect to the Other
Obligations, the holders of at least a majority of all obligations outstanding
from time to time under the Interest Rate Agreements and Other Hedging
Agreements.

17.           Each Guarantor acknowledges that an executed (or
conformed) copy of each of the Credit Documents, Interest Rate Agreements and
Other Hedging Agreements has been made available to its principal executive
officers and such officers are familiar with the contents thereof.

18.           In addition to any rights now or hereafter granted
under applicable law (including, without limitation, Section 151 of the
New York Debtor and Creditor Law) and not by way of limitation of any such
rights, upon the occurrence and during the continuance of an Event of Default
(such term to mean and include any “Event of Default” as defined in the Credit
Agreement or any payment default under any Interest Rate Agreements or Other
Hedging Agreements continuing after any applicable grace period), each Creditor
is hereby authorized at any time or from time to time, without notice to any
Guarantor or to any other Person, any such notice being expressly waived, to
set off and to appropriate and apply any and all deposits (general or special)
and any other indebtedness at any time held or owing by such Creditor to or for
the credit or the account of such Guarantor, against and on account of the
obligations and liabilities of such Guarantor to such Creditor under this
Guaranty, irrespective of whether or not such Creditor shall have made any
demand hereunder and although said obligations, liabilities, deposits or
claims, or any of them, shall be contingent or unmatured.

19.           All notices, requests, demands or other
communications pursuant hereto shall be deemed to have been duly given or made
when delivered to the Person to which such notice, request, demand or other
communication is required or permitted to be given or made under this Guaranty,
addressed to such party at (i) in the case of any Bank Creditor, as provided in
the Credit Agreement, (ii) in the case of any Guarantor, at the address of the
Borrower, as provided in the Credit Agreement and (iii) in the case of any
Other Creditor, at such address as such Other Creditor shall have specified in
writing to the Guarantor; or in any case at such other address as any of the
Persons listed above may hereafter notify the others in writing.

20.           If claim is ever made upon any Creditor for
repayment or recovery of any amount or amounts received in payment or on
account of any of the Guaranteed Obligations and any of the aforesaid payees
repays all or part of said amount by reason of (i) any judgment, decree or
order of any court or administrative body having jurisdiction over such payee
or any of its property or (ii) any settlement or compromise of any such claim
effected by such payee with any such claimant (including the Borrower), then
and in such event each Guarantor agrees that any such judgment, decree, order,
settlement or compromise shall be binding upon such Guarantor, notwithstanding
any revocation hereof or other instrument evidencing any liability of the
Borrower, and such Guarantor shall be and remain liable to the aforesaid payees
hereunder for the amount so repaid or recovered to the same extent as if such
amount had never originally been received by any such payee.

 7
 

21.

(a)           THIS GUARANTY AND THE
RIGHTS AND OBLIGATIONS OF THE CREDITORS AND OF THE UNDERSIGNED HEREUNDER SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW
YORK.  Any legal action or proceeding with
respect to this Guaranty or any other Credit Document to which such Guarantor
is a party may be brought in the courts of the State of New York or of the
United States of America for the Southern District of New York, and, by
execution and delivery of this Guaranty, each Guarantor hereby irrevocably
accepts for itself and in respect of its property, generally and
unconditionally, the non-exclusive jurisdiction of the aforesaid courts. Each
Guarantor hereby further irrevocably waives any claim that any such courts lack
jurisdiction over such Guarantor, and agrees not to plead or claim, in any
legal action or proceeding with respect to this Guaranty or any other Credit
Document to which such Guarantor is a party brought in any of the aforesaid
courts, that any such court lacks jurisdiction over such Guarantor. Each
Guarantor further irrevocably consents to the service of process out of any of
the aforementioned courts in any such action or proceeding by the mailing of
copies thereof by registered or certified mail, postage prepaid, to each
Guarantor at its address set forth in Section 19, such service to become
effective ten Business Days after such mailing. 
Each Guarantor hereby irrevocably waives any objection to such service
of process and further irrevocably waives and agrees not to plead or claim in
any action or proceeding commenced hereunder or under any other Credit Document
to which such Guarantor is a party that service of process was in any way
invalid or ineffective. Nothing herein shall affect the right of any of the
Creditors to serve process in any other manner permitted by law or to commence legal
proceedings or otherwise proceed against each Guarantor in any other
jurisdiction.

(b)           Each Guarantor hereby
irrevocably waives any objection which it may now or hereafter have to the
laying of venue of any of the aforesaid actions or proceedings arising out of
or in connection with this Guaranty or any other Credit Document brought in the
courts referred to in clause (a) above and hereby further irrevocably waives
and agrees not to plead or claim in any such court that such action or
proceeding brought in any such court has been brought in an inconvenient forum.

22.           In the event that all of the equity interests of
one or more Guarantors is sold or otherwise disposed of or liquidated in
compliance with the requirements of Section 7.02 of the Credit Agreement
(or such sale or other disposition or liquidation has been approved in writing
by the Required Banks (or all Banks if required by Section 11.13 of the
Credit Agreement) and the proceeds of such sale, disposition or liquidation are
applied in accordance with the provisions of the Credit Agreement, to the
extent applicable, such Guarantor shall be released from this Guaranty and this
Guaranty shall, as to each such Guarantor or Guarantors, terminate, and have no
further force or effect (it being understood and agreed that the sale of one or
more Persons that own, directly or indirectly, all of the equity interests of
any Guarantor shall be deemed to be a sale of such Guarantor for the purposes
of this Section 22).

23.           This Guaranty may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument. A set of counterparts
executed by all the parties hereto shall be lodged with the Borrower and the
Administrative Agent.

24.           EACH GUARANTOR AND EACH OF THE CREDITORS HEREBY
IRREVOCABLY WAIVES ALL RIGHTS TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR 

 8
 

COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS GUARANTY,
THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

25.           All payments made by any Guarantor hereunder will
be made without setoff, counterclaim or other defense.

26.           It is understood and agreed that any Subsidiary of
the Borrower that is required to execute a counterpart of this Guaranty after
the date hereof pursuant to Section 7.16 of the Credit Agreement shall
automatically become a Guarantor hereunder by executing a counterpart hereof
and delivering the same to the Administrative Agent.

[Remainder of page intentionally blank.

Signature page follows.]

 9

IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be
executed and delivered as of the date first above written.

	
  WORLDNET SERVICES CORP., as a 

  Guarantor

  	
   

  	
  HHS TEXAS MANAGEMENT, INC., as a 

  Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  UNIVERSAL AMERICAN FINANCIAL 

  SERVICES, INC., as a Guarantor

  	
   

  	
  CHCS SERVICES INC., as a Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  QUINCY COVERAGE CORPORATION, as a 

  Guarantor

  	
   

  	
  PSO MANAGEMENT OF TEXAS, LLC, as a 

  Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HERITAGE HEALTH SYSTEMS, INC., as a 

  Guarantor

  	
   

  	
  HHS TEXAS MANAGEMENT, L.P., as a 

  Guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HERITAGE HEALTH SYSTEMS OF TEXAS, 

  INC., as a Guarantor

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  	
   

  

 

Signature Page to Guaranty

ACCEPTED:

BANK
OF AMERICA, N.A.,

as Administrative Agent

	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  

 

Signature Page to Guaranty

EXHIBIT
G

FORM OF
COMPLIANCE CERTIFICATE

Financial Statement
Date:                             

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

Ladies and Gentlemen:

Reference is made to that certain Credit Agreement
dated as of January 18, 2007 (as amended, restated, supplemented or otherwise
modified in writing from time to time, the “Credit Agreement;” the terms
defined therein being used herein as therein defined), among Universal American
Financial Corp., a New York corporation (the “Borrower”), the Banks from time
to time party thereto, and Bank of America, N.A., as the Administrative
Agent.  The undersigned hereby certifies
as of the date hereof that he/she is the
                                             
of the Borrower, and that, as such, he/she is authorized to execute and deliver
this Certificate to the Administrative Agent on the behalf of the Borrower and
for the benefit of the Banks, and that:

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

prepared in accordance with GAAP]

1.             Attached
hereto as Schedule 1 are the year-end audited financial statements required by
Section 6.01(a)(i) of the Credit Agreement for the fiscal year of the Borrower
ended as of the above date (the “Subject Fiscal Year”), together with the
report and opinion of an independent certified public accountant required by
such section.

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

prepared in accordance with GAAP]

1.             Attached
hereto as Schedule 1 are the unaudited financial statements required by Section
6.01(b)(i) of the Credit Agreement for the fiscal quarter of the Borrower ended
as of the above date (the “Subject Fiscal Quarter”).  Such financial statements fairly present the
financial condition, results of operations and cash flows of the Borrower and
its Subsidiaries in accordance with GAAP as of the end of and for the Subject
Fiscal Quarter, subject only to normal year-end audit adjustments and the
absence of footnotes.

[Use following paragraph 2 for
fiscal year-end Annual Statements
 prepared in accordance with SAP]

2.             Attached
hereto as Schedule 2 are the year-end Annual Statements of each Regulated
Insurance Company as filed with the Applicable Insurance Regulatory Authority
and required by Section 6.01(a)(ii) of the Credit Agreement for the Subject
Fiscal Year.  Such Annual Statements
present fairly in all material respects the financial condition and results of
operations of such Regulated Insurance Companies in accordance with SAP as of
the end of and for the Subject Fiscal Year.

[Use following paragraph 2 for fiscal quarter-end financial statements

prepared in accordance with SAP]

2.             Attached
hereto as Schedule 2 are the quarterly financial statements of each Regulated
Insurance Company as filed with the Applicable Insurance Regulatory Authority
and required by Section 6.01(b)(ii) of the Credit Agreement for the Subject
Fiscal Quarter.  Such financial
statements present fairly in all material

 1
 

respects the financial condition and results of
operations of such Regulated Insurance Companies in accordance with SAP as of
the end of and for the Subject Fiscal Quarter.

3.             The
undersigned has reviewed and is familiar with the terms of the Credit Agreement
and has made, or has caused to be made under his/her supervision, a detailed
review of the transactions and condition (financial or otherwise) of the
Borrower and its Subsidiaries during the [Subject Fiscal Year][Subject Fiscal
Quarter] covered by the attached financial statements.

4.             A
review of the activities of the Borrower during the [Subject Fiscal
Year][Subject Fiscal Quarter] has been made under the supervision of the
undersigned with a view to determining whether during the [Subject Fiscal
Year][Subject Fiscal Quarter] the Borrower performed and observed all its
obligations under the Credit Documents, and

[select one:]

[to the best knowledge of the undersigned during the
[Subject Fiscal Year][Subject Fiscal Quarter], the Borrower performed and
observed each covenant and condition of the Credit Documents applicable to it.]

—or—

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

5.             The
following is a summary of all outstanding litigation at the end of the [Subject
Fiscal Year][Subject Fiscal Quarter] and of all litigation settled during the
[Subject Fiscal Year][Subject Fiscal Quarter], in each case involving the
Borrower or any of its Subsidiaries, which, if adversely determined, could
reasonably be expected to have a Material Adverse Effect:

6.             Set
forth on Schedule 3 attached hereto is true and correct information
demonstrating the compliance by the Borrower with certain of the financial and
negative covenants set forth in the Credit Agreement as of the end of the
[Subject Fiscal Year][Subject Fiscal Quarter].

IN WITNESS WHEREOF, the undersigned has executed this
Certificate as
of                      ,
200      .

 

	
  

  	
  UNIVERSAL AMERICAN FINANCIAL CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  

 

 2
 

For the [Subject
Fiscal Quarter][Subject Fiscal Year]
ended                               (the
“Statement Date”)

SCHEDULE
3

to the Compliance Certificate

($ in 000’s)

	
  I.

  	
  Section 7.10 – Leverage Ratio.(1)

  	
   

  
	
   

  	
  A.

  	
  Consolidated Indebtedness of the Borrower:

  	
  $

  
	
   

  	
  B.

  	
  Consolidated Total Capital of the Borrower:

  	
  $

  
	
   

  	
  C.

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

  	
  to 1

  
	
   

  	
  Maximum permitted:

  	
   

  

 

	
  Fiscal Quarter

  	
   

  	
  Ratio

  
	
   

  	
   

  	
   

  
	
  December 31, 2006

  	
   

  	
  0.35:1.00

  
	
  March 31, 2007
  and thereafter

  	
   

  	
  0.30:1.00

  

 

	
  II.

  	
  Section 7.11 – Fixed Charge
  Coverage Ratio.(2)

  
	
   

  	
   

  
	
   

  	
  A.

  	
  Borrower Cash Flow:

  
	
   

  	
   

  	
  1.

  	
  Adjusted Dividend Capacity

  	
  $

  
	
   

  	
   

  	
  2.

  	
  Tax sharing payments:

  	
  $

  
	
   

  	
   

  	
  3.

  	
  Interest income:

  	
  $

  
	
   

  	
   

  	
  4.

  	
  TPA EBITDA:

  	
  $

  
	
   

  	
   

  	
  5.

  	
  MSO EBITDA:

  	
  $

  
	
   

  	
   

  	
  6.

  	
  SG&A expenses:

  	
  $

  
	
   

  	
   

  	
  7.

  	
  Borrower Cash Flow, annualized as required under the
  Credit Agreement (Lines II.A.1 + 2 + 3 + 4 + 5 – 6):

  	
  $

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  B.

  	
  Fixed Charges:

  
	
   

  	
   

  	
  1.

  	
  Consolidated Interest Expense:

  	
  $

  
	
   

  	
   

  	
  2.

  	
  Scheduled principal repayments on Indebtedness:

  	
  $

  
	
   

  	
   

  	
  3.

  	
  Fixed Charges, annualized as required under the
  Credit Agreement (Lines II.B.1 + 2):

  	
  $

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  C.

  	
  Fixed Charge Coverage Ratio (Line II.A.7  ̧
  Line II.B.3):

  	
  to 1

  
	
   

  	
   

  	
  Minimum required: 1.50:1:00

  	
   

  

 

(1)          Calculated as of the end of each fiscal quarter.

(2)          Calculated as of the end of each fiscal
quarter ending on or after December 31, 2006 and for the four fiscal quarters
then ended.

 3
 

 

	
  III.

  	
  Section 7.12 – Minimum Risk Based
  Capital Ratio for each Regulated Insurance Company(3)
  (Fiscal year end only)

  
	
   

  	
  A.

  	
  American Exchange Life Insurance
  Company:

  
	
   

  	
   

  	
  1.

  	
  Total Adjusted Capital of A above:

  	
  $

  
	
   

  	
   

  	
  2.

  	
  Company Action Level of A above:

  	
  $

  
	
   

  	
   

  	
  3.

  	
  Risk Based
  Capital Ratio (Line III.A.1  ̧
  Line III.A.2), expressed as a percentage):

  	
  %

  
	
   

  	
   

  	
  Minimum
  required: 150%

  	
   

  
	
   

  
	
   

  	
  B.

  	
  Pennsylvania Life Insurance
  Company:

  
	
   

  	
   

  	
  1.

  	
  Total Adjusted Capital of B above:

  	
  $

  
	
   

  	
   

  	
  2.

  	
  Company Action Level of B above:

  	
  $

  
	
   

  	
   

  	
  3.

  	
  Risk Based Capital Ratio (Line III.B.1  ̧
  Line III.B.2), expressed as a percentage):

  	
  %

  
	
   

  	
   

  	
  Minimum required: 150%

  	
   

  
	
   

  
	
   

  	
  C.

  	
  Constitution Life Insurance
  Company:

  
	
   

  	
   

  	
  1.

  	
  Total Adjusted Capital of C above:

  	
  $

  
	
   

  	
   

  	
  2.

  	
  Company Action Level of C above:

  	
  $

  
	
   

  	
   

  	
  3.

  	
  Risk Based Capital Ratio (Line III.C.1  ̧
  Line III.C.2), expressed as a percentage):

  	
  %

  
	
   

  	
   

  	
  Minimum required: 150%

  	
   

  
	
   

  
	
   

  	
  D.

  	
  American Pioneer Life Insurance
  Company:

  
	
   

  	
   

  	
  1.

  	
  Total Adjusted Capital of D above:

  	
  $

  
	
   

  	
   

  	
  2.

  	
  Company Action Level of D above:

  	
  $

  
	
   

  	
   

  	
  3.

  	
  Risk Based Capital Ratio (Line III.D.1  ̧
  Line III.D.2), expressed as a percentage):

  	
  %

  
	
   

  	
   

  	
  Minimum required: 150%

  	
   

  
	
   

  
	
   

  	
  E.

  	
  American Progressive Life &
  Health Insurance Company of New York:

  
	
   

  	
   

  	
  1.

  	
  Total Adjusted Capital of E above:

  	
  $

  
	
   

  	
   

  	
  2.

  	
  Company Action Level of E above:

  	
  $

  
	
   

  	
   

  	
  3.

  	
  Risk Based Capital Ratio (Line III.E.1  ̧
  Line III.E.2), expressed as a percentage):

  	
  %

  
	
   

  	
   

  	
  Minimum required: 150%

  	
   

  
	
   

  
	
   

  	
  F.

  	
  Union Bankers Insurance Company:

  
	
   

  	
   

  	
  1.

  	
  Total Adjusted Capital of F above:

  	
  $

  
	
   

  	
   

  	
  2.

  	
  Company Action Level of F above:

  	
  $

  
	
   

  	
   

  	
  3.

  	
  Risk Based
  Capital Ratio (Line III.F.1  ̧
  Line III.F.2), expressed as a percentage):

  	
  %

  
	
   

  	
   

  	
  Minimum
  required: 150%

  	
   

  
	
   

  
	
   

  	
  G.

  	
  The Pyramid Life Insurance Company:

  	
   

  
	
   

  	
   

  	
  1.

  	
  Total Adjusted Capital of G above:

  	
  $

  
	
   

  	
   

  	
  2.

  	
  Company Action Level of G above:

  	
  $

  
								

 

(3)          Calculated as of the end of each fiscal year. 

 4
 

 

	
   

  	
   

  	
  3.

  	
  Risk Based Capital Ratio (Line III.G.1  ̧
  Line III.G.2), expressed as a percentage):

  	
  %

  
	
   

  	
   

  	
  Minimum required: 150%

  
	
   

  	
   

  	
   

  
	
   

  	
  H.

  	
  Marquette National Life Insurance
  Company:

  
	
   

  	
   

  	
  1.

  	
  Total Adjusted Capital of H above:

  	
  $

  
	
   

  	
   

  	
  2.

  	
  Company Action Level of H above:

  	
  $

  
	
   

  	
   

  	
  3.

  	
  Risk Based Capital Ratio (Line III.H.1  ̧
  Line III.H.2), expressed as a percentage):

  	
  %

  
	
   

  	
   

  	
  Minimum required: 150%

  
	
   

  	
   

  	
   

  
	
   

  	
  I.

  	
  SelectCare of Texas, LLC:

  
	
   

  	
   

  	
  1.

  	
  Total Adjusted Capital of I above:

  	
  $

  
	
   

  	
   

  	
  2.

  	
  Company Action Level of I above:

  	
  $

  
	
   

  	
   

  	
  3.

  	
  Risk Based Capital Ratio (Line III.I.1  ̧
  Line III.I.2), expressed as a percentage):

  	
  %

  
	
   

  	
   

  	
  Minimum required: 150%

  
	
   

  	
   

  
	
  V.

  	
  Section 7.13 - Minimum Consolidated
  Net Worth. (4)

  
	
   

  	
   

  
	
   

  	
  A.

  	
  Greater of (i) $260,000 or (ii) Required Minimum
  Consolidated Net Worth at end of the preceding fiscal quarter:

  	
  $

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  B.

  	
  50% of the Borrower’s Consolidated Net Income for
  the fiscal quarter ending on the Statement Date (no reduction for losses):

  	
  $

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  C.

  	
  Required Minimum Consolidated Net Worth for fiscal
  quarter ended on the Statement Date (Line V.A. + Line V.B.):

  	
  $

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  D.

  	
  Consolidated Net Worth (excluding the effects of FAS
  No. 115) as reported for fiscal quarter ended on the Statement Date:

  	
  $

  
	
   

  	
   

  	
   

  	
   

  
	
  VI.

  	
  Section 7.14 - Minimum Combined
  Adjusted Statutory Capital and Surplus. (5)

  
	
   

  	
   

  
	
   

  	
  A.

  	
  Adjusted Statutory Capital and Surplus of the
  Regulated Insurance Companies which are Domestic Subsidiaries of the Borrower
  (determined on a Combined basis):

  	
  $

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Minimum required: 85% of actual
  Combined Adjusted Statutory Capital and Surplus at March 31, 2004 (including
  SelectCare as a Regulated Insurance Company which is a Domestic Subsidiary of
  the Borrower from and after March 31, 2004), which was $                       .

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  VII.

  	
  Section 7.02(h) – Asset Sales

  
	
   

  	
   

  
	
   

  	
  A.

  	
  Fair market value of assets sold by the Borrower and
  its Subsidiaries during the fiscal period of the current fiscal year ending
  on the Statement

  	
   

  

 

(4)          Determined from and after June 30, 2004.

(5)          Determined from and after June 30, 2004.

 5
 

 

	
   

  	
   

  	
  Date (shall not exceed 10% of the Consolidated Net
  Worth of the Borrower as of the last day of the immediately preceding fiscal
  year):

  	
  $

  
	
   

  	
   

  	
   

  	
   

  
	
  VIII.

  	
  Section 7.02(i) – Permitted
  Acquisitions

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  A.

  	
  Aggregate amount of cash expended by the Borrower
  and its Subsidiaries for Permitted Acquisitions during the fiscal period of
  the current fiscal year ending on the Statement Date (shall not exceed 10% of
  the Consolidated Net Worth of the Borrower and its Subsidiaries as of the
  last day of the immediately preceding fiscal year):

  	
  $

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  B.

  	
  Aggregate value of Borrower common stock and
  preferred stock issued by the Borrower as consideration for Permitted
  Acquisitions during the fiscal period of the current fiscal year ending on
  the Statement Date (shall not exceed 35% of the Consolidated Net Worth of the
  Borrower and its Subsidiaries as of the last day of the immediately preceding
  fiscal year):

  	
  $

  
	
   

  	
   

  	
   

  	
   

  
	
  IX.

  	
  Section 7.04 - Indebtedness.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  A.

  	
  As of the Statement Date, the aggregate outstanding
  amount of Capitalized Lease Obligations plus purchase money Indebtedness, in
  each case permitted under Section 7.04(b) of the Credit Agreement (shall not
  exceed $10,000):

  	
  $

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  B.

  	
  As of the Statement Date, the aggregate outstanding
  amount of letter of credit obligations of the Regulated Insurance Companies
  permitted under Section 7.04(d)(i) and (ii) of the Credit Agreement (shall
  not exceed $15,000):

  	
  $

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  C.

  	
  As of the Statement Date, the aggregate outstanding
  amount of letter of credit obligations of the Regulated Insurance Companies
  permitted under Section 7.04(d)(iii) of the Credit Agreement (shall not
  exceed $5,000)

  	
  $

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  D.

  	
  As of the Statement Date, the aggregate amount of
  Indebtedness of the Borrower or a Wholly-Owned Subsidiary of the Borrower
  acquired pursuant to a Permitted Acquisition, including Indebtedness assumed
  at the time of a Permitted Acquisition of an asset securing such Indebtedness
  (shall not exceed 10% of the total value of the assets of the Subsidiary
  acquired, or of the assets acquired, as the case may be):

  	
  $

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  E.

  	
  As of the Statement Date, the aggregate amount of
  Indebtedness arising under letters of credit (other than the Letters of
  Credit) permitted under Section 7.04(h) of the Credit Agreement (shall
  not exceed $2,500)

  	
  $

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  F.

  	
  As of the Statement Date, the aggregate principal
  amount of the Trust Preferred Securities:

  	
  $

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  G.

  	
  As of the Statement Date, the aggregate outstanding
  principal amount of other Indebtedness of the Borrower permitted under
  Section 7.04(k) of the Credit Agreement (shall not exceed $7,500):

  	
  $

  

 

 6
 

 

	
  X.

  	
  Section 7.05 – Capital
  Expenditures.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  A.

  	
  Aggregate amount of Capital Expenditures incurred by
  the Borrower and its Subsidiaries during the fiscal period of the current
  fiscal year ending on the Statement Date (shall not exceed $15,000 plus the
  Rollover Amount carried forward from the immediately preceding fiscal year,
  if any):

  	
  $

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  B.

  	
  Rollover Amount of Capital Expenditures for the
  Subject Fiscal Year (if any) which may be carried forward to the immediately
  succeeding fiscal year: (6)

  	
  $

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  C.

  	
  Aggregate amount of Capital Expenditures incurred by
  the Borrower and its Subsidiaries since May 28, 2004 (shall not exceed
  $60,000):

  	
  $

  

 

(6)          Complete only for Subject Fiscal Year Compliance Certificate.

 7

EXHIBIT H

FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT

This Assignment and Assumption Agreement (this “Assignment and
Assumption”) is dated as of the Effective Date set forth below and is
entered into by and between [Insert name of Assignor]
(the “Assignor”) and [Insert name of Assignee]
(the “Assignee”).  Capitalized
terms used but not defined herein shall have the meanings given to them in the
Credit Agreement identified below (the “Credit Agreement”), receipt of a
copy of which is hereby acknowledged by the Assignee.  The Standard Terms and Conditions set forth
in Annex 1 attached hereto are hereby agreed to and incorporated herein by
reference and made a part of this Assignment and Assumption as if set forth
herein in full.

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

1.             Assignor:                                                              

2.             Assignee:                                                              
[and is an Affiliate/Approved Fund of [identify Bank](1)]

3.             Borrower:  Universal American Financial Corp.  (the “Borrower”)

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

5.             Credit
Agreement:  The Credit Agreement, dated
as of January 18, 2007, among Universal American Financial Corp., the lending
institutions parties thereto, and Bank of America, N.A., as Administrative
Agent and L/C Issuer 

6.             Assigned
Interest:

(1)                                  Select
as applicable.

 1
 

 

	
  Total Revolving Loan

  Commitment for all Banks

  	
   

  	
  Amount of Revolving Loan

  Commitment Assigned

  	
   

  	
  Percentage Assigned of Total

  Revolving Loan Commitment(2)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  $

  	
   

  	
  $

  	
   

  	
                                   %

  
	
  $

  	
   

  	
  $

  	
   

  	
                                   %

  

 

*                                         Amount to be adjusted by the Counterparties
to take into account any payments or prepayments made between the Trade Date
and the Effective Date.

[7.            Trade Date:                                    ](3)

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

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

ASSIGNOR

[NAME
OF ASSIGNOR]

 

	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  

 

 

ASSIGNEE

[NAME
OF ASSIGNEE]

 

	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  

 

(2)                                  Set
forth, to at least 9 decimals, as a percentage of the Total Revolving Loan
Commitment of all Banks under the Credit Agreement.

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

 2
 

[Consented to and](4)
Accepted:

BANK OF AMERICA, N.A., as Administrative Agent

 

	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  

 

 

[Consented
to:](5)

 

	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  

 

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

(5)                                  To
be added only if the consent of the Borrower and/or L/C Issuer is required by
the terms of the Credit Agreement.

 3
 

ANNEX 1
TO ASSIGNMENT AND ASSUMPTION AGREEMENT

UNIVERSAL AMERICAN FINANCIAL CORP. CREDIT AGREEMENT

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

1.             Representations and Warranties.

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

1.2.          Assignee.  The
Assignee (a) represents and warrants that (i) it has full power and authority,
and has taken all action necessary, to execute and deliver this Assignment and
Assumption and to consummate the transactions contemplated hereby and to become
a Bank under the Credit Agreement, (ii) it meets all requirements of an Eligible
Assignee under the Credit Agreement (subject to receipt of such consents as may
be required under the Credit Agreement), (iii) from and after the Effective
Date, it shall be bound by the provisions of the Credit Agreement as a Bank
thereunder and, to the extent of the Assigned Interest, shall have the
obligations of a Bank thereunder, (iv) it has received a copy of the Credit
Agreement, together with copies of the most recent financial statements
delivered pursuant to Section 6.01 thereof, as applicable, and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assignment and Assumption and to
purchase the Assigned Interest on the basis of which it has made such analysis
and decision independently and without reliance on the Administrative Agent or
any other Bank and (v) attached hereto is any documentation required to be
delivered by it pursuant to the terms of the Credit Agreement, duly completed
and executed by the Assignee; and (b) agrees that (i) it will, independently
and without reliance on the Administrative Agent, the Assignor or any other
Bank, and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit decisions in taking or not taking
action under the Credit Documents and (ii) it will perform in accordance with
their terms all of the obligations which by the terms of the Credit Documents
are required to be performed by it as a Bank.

2.             Payments.  From and after the Effective
Date, the Administrative Agent shall make all payments in respect of the
Assigned interest (including payments of principal, interest, fees and other
amounts) to the Assignee whether such amounts have accrued prior to or on or
after the Effective Date. The Assignor and the Assignee shall make all
appropriate adjustments in payments by the Administrative Agent for periods
prior to the Effective Date or with respect to the making of this assignment
directly between themselves.

3.             General Provisions.  This
Assignment and Assumption shall be binding upon, and inure to the benefit of,
the parties hereto and their respective successors and assigns.  This Assignment and Assumption

 4
 

may
be executed in any number of counterparts, which together shall constitute one
instrument.  Delivery of an executed
counterpart of a signature page of this Assignment and Assumption by telecopy
shall be effective as delivery of a manually executed counterpart of this
Assignment and Assumption.  This
Assignment and Assumption shall be governed by, and construed in accordance
with, the law of the State of New York.

 5

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00116-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00116-of-00352.parquet"}]]