Document:

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                                                                    EXHIBIT 10.2
                        AGREEMENT OF LIMITED PARTNERSHIP

                                       OF

                         SKB OPERATING PARTNERSHIP, L.P.

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                                TABLE OF CONTENTS
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ARTICLE I PARTNERSHIP...........................................................................   1

         1.1         CREATION OF PARTNERSHIP: PARTNERSHIP INTERESTS.............................   1
         1.2         NAME.......................................................................   1
         1.3         CERTIFICATES DESCRIBING PARTNERSHIP UNITS..................................   1

ARTICLE II DEFINITIONS..........................................................................   2

         2.1         DEFINITIONS................................................................   2

ARTICLE III CAPITALIZATION......................................................................  10

         3.1         CAPITAL CONTRIBUTIONS......................................................  10
         3.2         ISSUANCE AND REDEMPTION OF PARTNERSHIP INTERESTS...........................  10
         3.3         ADDITIONAL FUNDS...........................................................  16
         3.4         CAPITAL ACCOUNTS...........................................................  17
         3.5         INTEREST ON AND RETURN OF CAPITAL..........................................  18
         3.6         NEGATIVE CAPITAL ACCOUNTS..................................................  19
         3.7         LIMIT ON CONTRIBUTIONS AND OBLIGATIONS OF PARTNERS.........................  19
         3.8         REDEMPTION AND REPURCHASE OF UNITS.........................................  19
         3.9         REDEMPTION AND REPURCHASE OF INTERESTS OWNED BY SKB CONTROLLED ENTITIES....  19

ARTICLE IV OFFICE AND REGISTERED AGENT..........................................................  19

         4.1         PRINCIPAL OFFICE...........................................................  19
         4.2         REGISTERED OFFICE AND AGENT................................................  19

ARTICLE V PURPOSES AND POWERS OF PARTNERSHIP....................................................  20

         5.1         PURPOSES OF THE PARTNERSHIP................................................  20
         5.2         POWERS.....................................................................  20
         5.3         REIT REQUIREMENTS..........................................................  20

ARTICLE VI ALLOCATIONS..........................................................................  21

         6.1         PROFITS....................................................................  21
         6.2         LOSSES.....................................................................  22
         6.3         SPECIAL ALLOCATIONS........................................................  22
         6.4         CURATIVE ALLOCATIONS.......................................................  24
         6.5         TAX ALLOCATIONS; CODE SECTION 704(c).......................................  24

ARTICLE VII CASH AVAILABLE FOR DISTRIBUTION.....................................................  25

         7.1         DEFINITION OF AVAILABLE CASH...............................................  25
         7.2         TIMING AND PRIORITY OF DISTRIBUTIONS OF AVAILABLE CASH.....................  25
         7.3         CONSENT TO ALLOCATIONS AND DISTRIBUTIONS...................................  25
         7.4         RIGHT TO LIMIT DISTRIBUTIONS...............................................  25
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                                TABLE OF CONTENTS
                                    (cont'd)

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ARTICLE VIII MANAGEMENT OF PARTNERSHIP.......................................................   26

         8.1         GENERAL PARTNER.........................................................   26
         8.2         DELEGATION OF AUTHORITY.................................................   27
         8.3         LIMITED PARTNERS........................................................   27
         8.4         LIABILITY OF GENERAL PARTNER............................................   28
         8.5         INDEMNITY...............................................................   28
         8.6         OTHER ACTIVITIES OF PARTNERS AND AGREEMENTS WITH RELATED PARTIES........   28
         8.7         OTHER MATTERS CONCERNING THE GENERAL PARTNER............................   29
         8.8         PARTNER EXCULPATION.....................................................   29
         8.9         GENERAL PARTNER EXPENSES AND LIABILITIES................................   30

ARTICLE IX BANKING...........................................................................   31

         9.1         BANK ACCOUNTS...........................................................   31
         9.2         INVESTMENT OF FUNDS.....................................................   31

ARTICLE X ACCOUNTING.........................................................................   31

         10.1        FISCAL YEAR.............................................................   31
         10.2        BOOKS OF ACCOUNT........................................................   31
         10.3        METHOD OF ACCOUNTING....................................................   32
         10.4        TAX MATTERS.............................................................   32

ARTICLE XI TRANSFERS OF PARTNERSHIP INTERESTS................................................   33

         11.1        GENERAL PARTNER.........................................................   33
         11.2        LIMITED PARTNER.........................................................   33
         11.3        ADMISSION ADJUSTMENTS...................................................   35
         11.4        TRANSFERS TO LENDERS....................................................   35

ARTICLE XII ADMISSION OF NEW PARTNERS........................................................   35

ARTICLE XIII TERM, TERMINATION, LIQUIDATION AND DISSOLUTION OF PARTNERSHIP...................   35

         13.1        TERM AND TERMINATION....................................................   35
         13.2        METHOD OF LIQUIDATION...................................................   36
         13.3        DATE OF TERMINATION.....................................................   36
         13.4        RECONSTITUTION UPON BANKRUPTCY..........................................   37
         13.5        DEATH, LEGAL INCOMPETENCY, ETC. OF A LIMITED PARTNER....................   37

ARTICLE XIV POWER OF ATTORNEY................................................................   37

         14.1        POWER OF ATTORNEY.......................................................   37
         14.2        INTEREST................................................................   38
         14.3        WAIVER..................................................................   38
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                               TABLE OF CONTENTS
                                    (cont'd)

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         14.4        FURTHER ASSURANCES......................................................   38

ARTICLE XV AMENDMENT OF AGREEMENT............................................................   38

         15.1        POWER...................................................................   38
         15.2        REQUIRED CONSENT........................................................   39
         15.3        REIT STATUS.............................................................   39

ARTICLE XVI MISCELLANEOUS....................................................................   39

         16.1        NOTICES.................................................................   39
         16.2        SUCCESSORS AND ASSIGNS..................................................   39
         16.3        COUNTERPARTS............................................................   40
         16.4        CONSTRUCTION............................................................   40
         16.5        GOVERNING LAW...........................................................   40
         16.6        OTHER INSTRUMENTS.......................................................   40
         16.7        GENERAL PARTNER WITH INTEREST AS LIMITED PARTNER........................   40
         16.8        SEVERABILITY............................................................   40
         16.9        GENDER AND PLURALS......................................................   40
         16.10       ENTIRE AGREEMENT........................................................   40
         16.11       NO THIRD PARTY BENEFICIARY..............................................   40
         16.12       PURCHASE FOR INVESTMENT.................................................   41
         16.13       WAIVER..................................................................   41
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                        AGREEMENT OF LIMITED PARTNERSHIP

                                       OF

                         SKB OPERATING PARTNERSHIP, L.P.

      THIS AGREEMENT OF LIMITED PARTNERSHIP (this "Agreement") has been executed
and delivered effective as of the ___ day of _______________, 2004 (the
"Effective Date"), by SKB REIT, Inc., a Maryland corporation (the "General
Partner"), SKB Advisors LLC (the "Special Limited Partner" or "SKB Advisors")
and those persons and entities identified as "Limited Partners" in Schedule A
(the "Limited Partners"), (the General Partner and each Limited Partner being a
"Partner" and collectively, the "Partners").

                                    RECITALS

      WHEREAS, the General Partner wishes to satisfy the requirements for being
classified as a REIT for tax purposes;

      WHEREAS, the parties hereto deem it to be in their best interest to enter
into a limited partnership agreement in accordance with the Delaware Revised
Uniform Limited Partnership Act as amended (the "Act") and this Agreement.

      THEREFORE, in consideration of the mutual covenants contained in this
Agreement, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Partners agree as follows:

                                   ARTICLE I

                                  PARTNERSHIP

      1.1   CREATION OF PARTNERSHIP: PARTNERSHIP INTERESTS. The General Partner
is the sole general partner. The General Partner hereby consents to admit SKB
Advisors LLC as Special Limited Partner as of the date hereof. The Limited
Partners shall be those Persons identified as Limited Partners on Exhibit A
hereto, as amended from time to time. No Partner has any interest in any
Partnership property solely as a result of being a Partner and the interests of
all Partners in the Partnership are, for all purposes, personal property.

      1.2   NAME. The Partnership name shall be "SKB Operating Partnership,
L.P." The Partnership's business may be conducted under any other name or names
deemed advisable by the General Partner, including the name of the General
Partner or any Affiliate thereof. The words "Limited Partnership," "L.P.,"
"Ltd." or similar words or letters shall be included in the Partnership's name
where necessary for the purposes of complying with the laws of any jurisdiction
that so requires. The General Partner in its sole and absolute discretion may
change the name of the Partnership at any time and from time to time shall
notify the Limited Partners of such change in the next regular communication to
the Limited Partners.

      1.3   CERTIFICATES DESCRIBING PARTNERSHIP UNITS. At the request of a
Limited Partner, the General Partner, at its option, may issue a certificate
summarizing the terms of such Limited

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Partner's interest in the Partnership, including the number of Partnership Units
owned and the Percentage Interest represented by such Partnership Units as of
the date of such certificate. Any such certificate (i) shall be in form and
substance as approved by the General Partner, (ii) shall not be negotiable, and
(iii) shall bear a legend to the following effect:

      This certificate is not negotiable. The Partnership Units represented by
      this certificate are governed by and transferable only in accordance with
      the provisions of the Agreement of Limited Partnership of SKB OPERATING
      PARTNERSHIP, L.P.

                                   ARTICLE II

                                   DEFINITIONS

      2.1   DEFINITIONS. As used in this Agreement, the following terms shall
have the meanings set forth respectively after each:

      "Act" shall mean the Delaware Revised Uniform Limited Partnership Act, as
amended from time to time, and any successor statute.

      "Additional Limited Partner" means any Person admitted to the Partnership
as a Limited Partner pursuant to Article XII hereof.

      "Adjusted Capital Account" shall mean, at any time, the then balance in
the Capital Account of a Partner, after giving effect to the following
adjustments:

            (i)   add to such Capital Account any amounts that such Partner is
      obligated to restore or is deemed obligated to restore under any provision
      of this Agreement or as described in the penultimate sentences of
      Regulations Section 1.704-2(g)(1) and Regulations Section 1.704-2(i)(5),
      or any successor provisions; and

            (ii)  subtract from such Capital Account the items described in
      Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6).

      "Adjusted Capital Account Deficit" shall mean, with respect to any
Partner, the deficit balance, if any, in that Partner's Adjusted Capital
Account.

      "Affiliate" means (i) any Person directly or indirectly owning,
controlling, or holding, with power to vote ten percent or more of the
outstanding voting securities of such other Person, (ii) any Person ten percent
or more of whose outstanding voting securities are directly or indirectly owned,
controlled, or held, with the power to vote, by such other Persons, (iii) any
Person directly or indirectly controlling, controlled by, or under common
control with such other Person, (iv) any executive officer, director, trustee or
general partner of such other person, or (v) any legal entity for which such
Person acts as an executive officer, director, trustee or general partner.

      "Agreement" shall mean this Agreement of Limited Partnership, as it may be
amended from time to time.

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      "Articles of Incorporation" means the Articles of Incorporation of the
General Partner.

      "Available Cash" shall have the meaning provided in Section 7.1.

      "Bankruptcy" of a Partner shall mean (a) the filing by a Partner of a
voluntary petition seeking liquidation, reorganization, arrangement or
readjustment, in any form, of its debts under Title 11 of the United States Code
(or corresponding provisions of future laws) or any other federal or state
insolvency law, or a Partner's filing an answer consenting to or acquiescing in
any such petition, (b) the making by a Partner of any assignment for the benefit
of its creditors or the admission by a Partner in writing of its inability to
pay its debts as they mature, or (c) the expiration of sixty (60) days after the
filing of any involuntary petition under Title 11 of the United States Code (or
corresponding provisions of future laws), seeking liquidation, reorganization,
arrangement or readjustment of its debts under any other Federal or state
insolvency law, provided that the same shall not have been vacated, set aside or
stayed within such 60-day period.

      "Board of Directors" means the Board of Directors of the General Partner.

      "Business Day" means any day other than Saturday or Sunday during which
national banks located in Portland, Oregon are customarily open for business.

      "Capital Account" shall mean the capital account maintained by the
Partnership for each Partner as described in Section 3.4 below.

      "Capital Contribution" shall mean, when used in respect of a Partner, if
applicable, the initial capital contribution of such Partner as set forth in
Section 3.1 below, and any other amounts of cash, cash equivalents and/or the
Gross Asset Value of other property or assets contributed by such Partner to the
capital of the Partnership with respect to the Partner's interest in the
Partnership, including the Capital Contribution made by any predecessor holder
of the Partnership Interest of such Partner.

      "Capital Transaction Gain or Loss" shall mean any Profits or Losses
described in paragraphs (iii), (iv) and (vi) of the definition of Profits and
Losses contained in this Article II.

      "Cash Amount" means an amount of cash equal to the value of the REIT
Shares Amount, which shall be based upon Net Asset Value on the date of receipt
by the General Partner of a Notice of Redemption.

      "Code" shall mean the Internal Revenue Code of 1986, as the same may be
amended from time to time, and any successor statute.

      "Common Share" means a share of common stock, $0.001 par value per share,
of the General Partner.

      "Constructively Own" means ownership under the constructive ownership
rules of Section 318 of the Code, as modified by Section 856(d)(5) of the Code.

      "Contributing Partner" shall have the meaning provided in Section
3.2(b)(v).

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      "Depreciation" shall mean for any fiscal year or portion thereof, an
amount equal to the depreciation, amortization or other cost recovery deduction
allowable with respect to an asset for such period for Federal income tax
purposes, except that if the Gross Asset Value of an asset differs from its
adjusted basis for Federal income tax purposes at the beginning of such period,
Depreciation shall be an amount that bears the same relationship to such
beginning Gross Asset Value as the depreciation, amortization or cost recovery
deduction in such period for Federal income tax purposes bears to the beginning
adjusted tax basis; provided, however, that if the adjusted basis for Federal
income tax purposes of an asset at the beginning of such period is zero,
Depreciation shall be determined with reference to such beginning Gross Asset
Value using any reasonable method selected by the General Partner.

      "Effective Date" shall have the meaning provided in the introductory
paragraph of this Agreement.

      "Exchange Date" shall have the meaning provided in Section 3.2(g).

      "General Partner" means SKB REIT, Inc., a Maryland corporation and the
General Partner of the Partnership.

      "Gross Asset Value" means, with respect to any Partnership asset, the
asset's adjusted basis for Federal income tax purposes, except as follows:

            (i) The initial Gross Asset Value of any asset contributed by a
      Partner to the Partnership shall be the gross fair market value of such
      asset, as agreed to by the General Partner and such Contributing Partner;

            (ii) The Gross Asset Value of all Partnership assets shall be
      adjusted to equal their respective gross fair market values, which shall
      be determined in a manner consistent with the determination of Net Asset
      Value, as of the following times: (a) the acquisition of an additional
      interest in the Partnership by any new or existing Partner in exchange for
      more than a de minimis Capital Contribution; (b) the distribution by the
      Partnership to a Partner of more than a de minimis amount of Partnership
      property as consideration for an interest in the Partnership; (c) the
      liquidation of the Partnership within the meaning of Regulations Section
      1.704-1(b)(2)(ii)(g); and (d) upon the occurrence of any other event for
      which an adjustment to Gross Asset Value is permitted under the
      Regulations; provided, however, that adjustments pursuant to clauses (a),
      (b) and (d) above shall be made only if the General Partner reasonably
      determines that such adjustments are necessary or appropriate to reflect
      the relative economic interests of the Partners in the Partnership;

            (iii) The Gross Asset Value of any Partnership asset distributed to
      any Partner shall be adjusted to equal the gross fair market value of such
      asset on the date of distribution, which shall be determined in a manner
      consistent with the determination of Net Asset Value;

            (iv) The Gross Asset Value of Partnership assets shall be increased
      (or decreased) to reflect any adjustments to the adjusted basis of such
      assets pursuant to Code Section 734(b) or Code Section 743(b), but only to
      the extent that such adjustments are

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      taken into account in determining Capital Accounts pursuant to Regulations
      Section 1.704-1(b)(2)(iv)(m) and paragraph (vi) of the definition of
      Profits and Losses in this Article II below; provided, however, that Gross
      Asset Value shall not be adjusted pursuant to this paragraph (iv) to the
      extent the General Partner determines that an adjustment pursuant to
      paragraph (ii) above is necessary or appropriate in connection with a
      transaction that would otherwise result in an adjustment pursuant to this
      paragraph (iv); and

            (v) If the Gross Asset Value of an asset has been determined or
      adjusted pursuant to paragraphs (i), (ii) or (iv) above, such Gross Asset
      Value shall thereafter be adjusted by the Depreciation taken into account
      with respect to such asset for purposes of computing Profits and Losses.

      "Issuance Date" means with respect to OP Units or the Partnership
Interests owned by a Limited Partner (other than the Special Limited Partner),
the date upon which such OP Units or Partnership Interests are issued to such
Limited Partner (and with respect to Preference Units, shall have the meaning
set forth in the applicable Preference Unite Term Sheet).

      "Limited Partner" means any Person (other than the Special Limited
Partner) named as a Limited Partner on Exhibit A attached hereto, as Exhibit A
may be amended from time to time, and any Person who becomes a Substitute or
Additional Limited Partner, in such Person's capacity as a Limited Partner in
the Partnership.

      "Limited Partnership Interest" means the ownership interest of a Limited
Partner in the Partnership at any particular time, including the right of such
Limited Partner to any and all benefits to which such Limited Partner may be
entitled as provided in this Agreement and in the Act, together with the
obligations of such Limited Partner to comply with all the provisions of this
Agreement and of such Act.

      "Majority-in-Interest of the Limited Partners" shall mean, as of any given
time, Limited Partners (other than the Special Limited Partner) who own more
than fifty percent (50%) of the Percentage Interests in the Partnership held
such Limited Partners.

      "Net Asset Value" as of a particular date means the net fair market value
of the Partnership's equity as of such date, as approved by the Board of
Directors, which shall generally equal the net proceeds that would be available
for distribution by the Partnership if all properties owned directly or
indirectly (through one or more special purpose entities) by the Partnership
were sold at their fair market value in an all cash sale as of such date, and
all expected transaction costs (including all closing costs customarily borne by
a seller in the market where each Property is located and estimated legal fees
and expenses) were paid, and all liabilities were repaid, out of such proceeds.

      "Nonrecourse Deductions" has the meaning set forth in Regulations Section
1.704-2(c).

      "Nonrecourse Liability" has the meaning set forth in Regulations Section
1.752-1(a)(2).

      "Notice of Redemption" means a written notice delivered by a Redeeming
Partner to the Partnership (with a copy to the General Partner) under Section
3.2(c), pursuant to which the

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Redeeming Partner exercises the Redemption Right with respect to all or a
portion of its OP Units in accordance with the provisions of Section 3.2(c).

      "OP Units" are units of Partnership Interest more particularly described
in Section 3.2.

      "OP Unit Value" shall mean, as of any given time, the number of OP Units
into which a Preference Unit is convertible (whether or not the conversion can
then be effected), or the value of the Preference Unit expressed in OP Units if
the Preference Unit is not convertible into OP Units, as provided for in the
applicable Preference Unit Term Sheet.

      "Other Securities" shall have the meaning set forth in Section 3.2(b)(iv).

      "Partner Nonrecourse Debt" has the meaning set forth in Regulations
Section 1.704-2(b)(4).

      "Partner Nonrecourse Debt Minimum Gain" has the meaning set forth in
Regulations Section 1.704-2(i)(3).

      "Partner Nonrecourse Deductions" has the meaning set forth in Regulations
Section 1.704-2(i)(2).

      "Partners" shall mean, collectively, the General Partner, the Special
Limited Partner and the Limited Partners, or any additional or successor
partners of the Partnership admitted to the Partnership in accordance with the
terms of this Agreement. References to a Partner shall be to any one of the
Partners.

      "Partnership Interest" shall mean the ownership interest of a Partner in
the Partnership at any particular time, including the right to any and all
benefits to which such Partner may be entitled as provided in this Agreement,
and to the extent not inconsistent with this Agreement, under the Act, together
with the obligations of such Partner to comply with all of the terms and
provisions of this Agreement and the Act.

      "Partnership Minimum Gain" has the meaning set forth in Regulations
Sections 1.704-2(b)(2) and 1.704-2(d).

      "Percentage Interest" shall be determined as of the end of each calendar
month in the following manner: the Percentage Interest as of the end of a
particular calendar month for each Partner holding Units shall equal (a) the sum
of the OP Unit Value of any Preference Units held by that Partner and the number
of OP Units held by that Partner, divided by (b) the sum of the OP Unit Value of
all Preference Units issued and outstanding at the time and the total number of
OP Units issued and outstanding at the time. The Percentage Interests determined
as of the end of a particular month shall become effective as of at the
beginning of the immediately following month. The respective Percentage
Interests of the Partners as of the date of this Agreement are set forth in
Schedule A attached to this Agreement.

      "Person" means an individual, corporation, partnership, estate, trust, a
portion of a trust set aside for or to be used exclusively for the purposes
described in Section 642(c) of the Code, association, private foundation within
the meaning of Section 509(a) of the Code, joint stock

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company or other entity and also includes a group as that term is used for
purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended.

      "Preference Units" are units of Partnership Interest more particularly
described in Section 3.2(a)(ii).

      "Preference Unit Term Sheet" shall have the meaning provided in Section
3.2(b)(1).

      "Private Placement PTP Exemption" shall mean the exemption from publicly
traded partnership status provided in Regulations Section 1.7704-1(h) (which
generally applies if (i) all interests in a partnership are issued in a
transaction or series of transactions that are not required to be registered
under the Securities Act and (ii) the partnership does not have more than 100
partners, as computed for this purpose by taking into account owners of certain
"flow through" entities as provided in such Regulation, at any time during
taxable year of the partnership).

      "Private Transfer" shall mean:

            (i) transfers in which the basis of the Partnership Interest in the
      hands of the transferee is determined, in whole or in part, by reference
      to its basis in the hands of the transferor or is determined under Code
      Section 732;

            (ii) transfers at death, including transfers from an estate or
      testamentary trust;

            (iii) transfers between members of a family;

            (iv) transfers involving the issuance of interests by (or on behalf
      of) the Partnership in exchange for cash, property, or services;

            (v) transfers involving distributions from a qualified retirement
      plan or an individual retirement account;

            (vi) the transfer by a Partner and any related persons (within the
      meaning of Code Section 267(b) or 707(b)(1)) in one or more transactions
      during any 30 calendar day period of Partnership Interests representing in
      the aggregate more than 2 percent of the total interests in Partnership
      capital or profits;

            (vii) transfers by one or more Partners of interests representing in
      the aggregate 50 percent or more of the total interests in Partnership
      capital and profits in one transaction or a series of related
      transactions; and

            (viii) transfers not recognized by the Partnership within the
      meaning of Regulations Section 1.7704-1(d)(2) (i.e., transfers in cases
      where the Partnership neither admits the transferee as a partner nor
      recognizes any rights of the transferee as a partner).

      "Profits" and "Losses" shall mean for each fiscal year or portion thereof,
an amount equal to the Partnership's items of taxable income or loss for such
year or period, determined by the General Partner in accordance with Code
Section 703(a) with the following adjustments:

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            (i) any income which is exempt from Federal income tax and not
      otherwise taken into account in computing Profits or Losses shall be added
      to taxable income or loss;

            (ii) any expenditures of the Partnership described in Code Section
      705(a)(2)(B) or treated as Code Section 705(a)(2)(B) expenditures under
      Regulations Section 1.704-1(b)(2)(iv)(i) and not otherwise taken into
      account in computing Profits or Losses, will be subtracted from taxable
      income or loss;

            (iii) in the event that the Gross Asset Value of any Partnership
      asset is adjusted pursuant to the definition of Gross Asset Value
      contained in this Article II, the amount of such adjustment shall be taken
      into account as gain or loss from the disposition of such asset for
      purposes of computing Profits and Losses;

            (iv) gain or loss resulting from any disposition of Partnership
      assets with respect to which gain or loss is recognized for Federal income
      tax purposes shall be computed by reference to the Gross Asset Value of
      the property disposed of, notwithstanding that the adjusted tax basis of
      such property differs from its Gross Asset Value;

            (v) in lieu of the depreciation, amortization and other cost
      recovery deductions taken into account in computing such taxable income or
      loss, there shall be taken into account Depreciation for such fiscal year
      or other period;

            (vi) to the extent an adjustment to the adjusted tax basis of any
      Partnership asset pursuant to Code Section 734(b) or Code Section 743(b)
      is required pursuant to Regulations Section 1.704-1(b)(2)(iv)(m)(4) to be
      taken into account in determining Capital Accounts as a result of a
      distribution other than in complete liquidation of a Partner's Partnership
      Interest, is required pursuant to the last sentence of Regulations Section
      1.704-1(b)(2)(iv)(m)(2) to be taken into account in determining Capital
      Accounts, the amount of such adjustment shall be treated as an item of
      gain (if the adjustment increases the basis of the asset) or loss (if the
      adjustment decreases the basis of the asset) from the disposition of the
      asset and shall be taken into account for purposes of computing Profits or
      Losses; and

            (vii) any items specially allocated pursuant to Section 6.3 or
      Section 6.4 shall not be considered in determining Profits or Losses.

      "Recapitalization" shall have the meaning provided in Section 3.2(f).

      "Record Date" shall have the meaning provided in Section 8.1.

      "Redeeming Partner" shall have the meaning provided in Section 3.2(c).

      "Redemption Amount" means either the Cash Amount or the REIT Shares Amount
as determined pursuant to Section 3.2 hereof.

      "Redemption Right" shall have the meaning provided in Section 3.2(c).

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      "Regulations" shall mean the Federal Income Tax Regulations, including
Temporary Regulations, promulgated under the Code, as such regulations may be
amended from time to time (including corresponding provisions of succeeding
regulations).

      "REIT" shall have the meaning provided in Section 5.3.

      "REIT Requirements" shall have the meaning provided in Section 5.3.

      "REIT Shares Amount" means a number of Common Shares equal to the number
of OP Units offered for redemption by a Redeeming Partner, as adjusted pursuant
to Sections 3.2(f) and (g).

      "Rights" shall have the meaning provided in Section 3.2(g).

      "SKB Controlled Entity" shall mean any partnership, limited liability
company, corporation, trust or other entity which is, directly or indirectly,
controlled by (a) the General Partner, and/or (b) SKB Advisors.

      "Special Limited Partner" shall mean SKB Advisors, and any Person who
becomes a substitute or additional Special Limited Partner as provided herein.

      "Specified Redemption Date" means with respect to a Redeeming Partner, the
date that is ten Business Days after receipt by the General Partner of the
Notice of Redemption from such Partner.

      "Substitute Limited Partner" means any Person admitted to the Partnership
as a Limited Partner pursuant to Section 11.2 hereof.

      "Tenant" means any tenant from which the General Partner derives rent
either directly or indirectly through partnerships, including the Partnership.

      "TMP" shall have the meaning provided in Section 10.4.

      "Transfer" shall mean any sale, transfer, gift, exchange, assignment,
devise or other disposition, any pledge or collateral assignment, and any other
event that causes any Person to acquire beneficial ownership, or any agreement
to take any such actions or cause any such events, with respect to Units or
Partnership Interests, or the right to vote or receive distributions with
respect to Units or Partnership Interests, including (a) the granting or
exercise of any option (or any disposition of any option), (b) any disposition
of any securities or rights convertible into or exchangeable for Units or
Partnership Interests or any interest therein or any exercise of any such
conversion or exchange right, and (c) Transfers of interests in other entities
that result in changes in beneficial ownership of Units or Partnership
Interests; in each case, whether voluntary or involuntary, whether owned of
record or beneficially owned, and whether by operation of law or otherwise;
provided, however, neither the conversion of a Preference Unit into one or more
OP Units nor the redemption of an OP Unit in accordance with Section 3.2
constitutes a Transfer. The terms "Transferor," "Transferee," "Transferred" and
"Transferring" have correlative meanings.

                                       9
<PAGE>

      "Units" has the meaning set forth in Section 3.2(a).

                                  ARTICLE III

                                 CAPITALIZATION

      3.1   CAPITAL CONTRIBUTIONS.

            (a)   As of the effective date hereof, the Partners have made or
will make contributions of cash and/or property to the Partnership in exchange
for Units, and the amount of such cash contributions and the Gross Asset Value
of such in-kind Capital Contributions and the number of Units issued in exchange
therefor are reflected in the Capital Account balance of each such Partner as
set forth opposite such Partner's name on the attached Schedule A, as amended
from time to time.

            (b)   To the extent the Partnership acquires any property by the
merger of any other Person into the Partnership or the contribution of assets by
any other Person to the Partnership, Persons who receive Partnership Interests
in exchange for their interests in the Person merging into or contributing
assets to the Partnership shall become Partners and shall be deemed to have made
Capital Contributions as provided in the applicable merger agreement or
contribution agreement and as set forth in Schedule A, as it shall be amended to
reflect such deemed Capital Contributions.

      3.2   ISSUANCE AND REDEMPTION OF PARTNERSHIP INTERESTS.

            (a)   The interest of a Partner in the Partnership that has been
received in exchange for Capital Contributions is referred to as being evidenced
by one or more "Units." Units may be either "OP Units" or "Preference Units."
The General Partner is hereby authorized to cause the Partnership to issue such
additional Partnership Interests in the form of Units for any Partnership
purpose at any time or from time to time, to the Partners (including the General
Partner and the Special Limited Partner) or to other Persons for such
consideration and on such terms and conditions as shall be established by the
General Partner in its sole and absolute discretion, all without the approval of
the Special Limited Partner or any Limited Partners.

                  (i)   An "OP Unit" is a unit of Partnership Interest that has
been received in exchange for Capital Contributions and that, as more
particularly provided for below in Section 3.2(c), may be redeemed for the
Redemption Amount. The General Partner may create separate classes or series of
OP Units having privileges, variations, and designations as may be determined by
the General Partner in its sole and absolute discretion.

                  (ii)  A "Preference Unit" is a unit of Partnership Interest
having such rights, preferences and other privileges, variations and
designations as may be determined by the General Partner in its sole and
absolute discretion (but not in violation of the provisions of Section 3.2(b) or
the terms of any other Preference Unit(s) Term Sheet(s)). There may be more than
one series or class of Preference Units having differing terms and conditions,
but all Preference Units within a given series or class shall have the same
rights, preferences and other privileges, variations and designations. With
respect to each series or class of Preference Units, the General Partner may
also, in its discretion, determine and fix, among other terms and

                                       10
<PAGE>

conditions, any of the following: (a) the allocations of items of Partnership
income, gain, profits or losses, deduction and credit to each such class or
series of Partnership Interests, (b) the right to share in distributions and the
distribution rate therefor, if any, (c) the price at and the terms and
conditions on which such Preference Units may be redeemed, (d) the amount
payable and rights in respect of such Preference Units in the event of
involuntary or voluntary liquidation, (e) the terms and conditions on which such
Preference Units may be converted and the securities into which such Preference
Units may be converted (and/or the valuation of such Preference Units as
measured in OP Units), if such Preference Units are issued with the privilege of
conversion, and (f) the number of such reference Units to be issued as a part of
such series. Once determined and fixed as herein provided, however, the terms
and conditions of a particular series or class of Preference Units may not be
changed without the written consent of the holders of at least 67% of the
Preference Units within the class or series (or such greater percentage as may
be provided for in any the applicable Preference Unit Term Sheet).

Without limiting the foregoing, the General Partner is expressly authorized to
cause the Partnership to issue Partnership Units for less than fair market
value, so long as the General Partner concludes in good faith that such issuance
is in the best interests of the General Partner and the Partnership.

            (b)   From time to time hereafter, subject to and in accordance with
the provisions of this Section 3.2(b), the General Partner shall cause the
Partnership to issue additional Units as follows:

                  (i)   OP Units to the General Partner upon the issuance by the
General Partner of additional Common Shares (other than in exchange for OP
Units) and the contribution of the net proceeds thereof as a Capital
Contribution to the Partnership as provided for in Section 3.3(b) below, it
being understood, however, that the General Partner may issue Common Shares in
connection with share option plans, dividend reinvestment plans, restricted
share plans or other benefit or compensation plans without receiving any
proceeds and that the issuance of such Common Shares shall nonetheless entitle
the General Partner to receive additional OP Units pursuant to this clause (i);

                  (ii)  OP Units to Partners (including the General Partner)
that hold Preference Units that are convertible into OP Units, upon the exercise
of such conversion in accordance with the terms and conditions of the Preference
Unit Term Sheet applicable thereto;

                  (iii) OP Units to Partners holding OP Units (including the
General Partner) if and to the extent of each such Partner's participation in
any reinvestment program contemplated by Section 3.3(c) below;

                  (iv)  Preference Units to the General Partner upon the
issuance by the General Partner of securities other than Common Shares whether
debt or equity securities ("Other Securities") and the contribution of the net
proceeds thereof as a Capital Contribution to the Partnership as provided for in
Section 3.3(b) below; and

                  (v)   in all other cases, OP Units and/or Preference Units, as
determined by the General Partner, in its discretion, to existing or
newly-admitted Partners (including the

                                       11
<PAGE>

General Partner), in exchange for the contribution by a Partner (the
"Contributing Partner") of Capital Contributions to the Partnership.

Issuance of OP Units and Preference Units as aforesaid shall be in accordance
with the following:

                  (1)   the number of OP Units issued to the General Partner
under clause (i) of this Section 3.2(b) shall be equal to the number of Common
Shares issued;

                  (2)   the number of OP Units issued to a Partner under clause
(ii) of this Section 3.2(b) shall be as provided for in the Preference Unit Term
Sheet pursuant to which the Preference Units being converted exist;

                  (3)   the number of OP Units issued to a Limited Partner under
clause (iii) of this Section 3.2(b) shall be as provided for in the applicable
reinvestment program;

                  (4)   Preference Units issued pursuant to clause (iv) of this
Section 3.2(b) shall have economic terms substantially identical to those of the
applicable Other Securities; and

                  (5)   the number of OP Units issued to a Contributing Partner
under clause (v) of this Section 3.2(b) shall be equal to the quotient (rounded
to the nearest whole number) arrived at by dividing (x) the initial Gross Asset
Value of the property contributed as additional Capital Contributions (net of
any debt to which such property is subject or assumed by the Partnership in
connection with such contribution) by (y) the Net Asset Value attributable to
each OP Unit. Preference Units issued pursuant to clause (v) of this Section
3.2(b) shall have the terms and conditions specified in an agreement (a
"Preference Unit Term Sheet") executed by and between the Partnership (at the
direction or in the discretion of the General Partner) and the Contributing
Partner. The number of Preference Units issued to a Contributing Partner under
clause (v) of this Section 3.2(b) shall be equal to the quotient (rounded to the
nearest whole number) arrived at by dividing (x) the net fair market value of
any property or assets contributed as additional capital contributions by (y)
price per Preference Unit provided for in the Preference Unit Term Sheet.

Units may also be issued to some or all of the Partners holding Preference Units
if and to the extent of such Partner's participation in any reinvestment program
contemplated by Section 3.3(c). Upon the issuance of additional OP Units and/or
Preference Units in accordance with the provisions of this Section 3.2(b), each
recipient of such Units shall either execute this Agreement or a joinder to this
Agreement (which joinder, as to Preference Units, may be a part of any
applicable Preference Unit Term Sheet) and, as applicable, the Percentage
Interest of all of the Partners shall thereupon be appropriately adjusted by the
General Partner.

            (c)   Subject to the provisions of Sections 3.2(d) and (f), on or
after the later of (i) the date which is one year after the Issuance Date or
(ii) upon the completion of an initial public offering of the Common Shares
pursuant to a registration statement filed with the Securities and Exchange
Commission, each Limited Partner (including the Special Limited Partner) shall
have the right (the "Redemption Right") to require the Partnership to redeem on
a Specified Redemption Date all or a portion of the OP Units held by such
Limited Partner at a

                                       12
<PAGE>

redemption price equal to and in the form of the Redemption Amount. The
Redemption Right shall be exercised pursuant to a Notice of Redemption delivered
to the Partnership (with a copy to the General Partner) by the Limited Partner
who is exercising the Redemption Right (the "Redeeming Partner"); provided,
however, that the Partnership shall not be obligated to satisfy such Redemption
Right if the General Partner elects to purchase the OP Units subject to the
Notice of Redemption pursuant to Section 3.2(e). Notwithstanding the foregoing
provisions of this Section 3.2(c), the General Partner agrees to use its best
efforts to cause the closing of the acquisition of redeemed Partnership
Interests hereunder to occur as quickly as reasonably possible. The Redeeming
Partner shall have no right, with respect to any OP Units so redeemed, to
receive any distribution paid with respect to such OP Units if the Record Date
for such distribution is on or after the Specified Redemption Date. If, and
beginning with the first day of the first taxable year in which, the Partnership
no longer qualifies for the Private Placement PTP Exemption, the Redemption
Right shall comply with the requirements of Regulations Section 1.7704-1(f) and
shall be construed and administered in accordance therewith.

            (d)   In addition to other restrictions set forth on the Redemption
Rights in any other provision of this Agreement, the following restrictions
apply to Redemption Rights:

                  (i)   Notwithstanding any other provision of this Article III,
but subject to the last sentence of clause (iii) below, a Limited Partner shall
be entitled to exercise the Redemption Right only if (x) the redemption or
purchase of the Limited Partner's OP Units would constitute a Private Transfer
or (y) the Percentage Interest attributable to the OP Units to be purchased or
redeemed, when aggregated with other Transfers of Partnership Interests within
the same taxable year of the Partnership (but not including Private Transfers),
would constitute a Percentage Interest of ten percent (10%) or less.

                  (ii)  The General Partner may establish such policies and
procedures as it may deem necessary or desirable in its discretion to administer
the 10% Percentage Interest limit set forth in subparagraph (i) above, including
without limitation imposing further limitations on the OP Units with respect to
which the Redemption Right may be exercised during any period of time shorter
than a calendar year and establishing procedures to allocate the ability to
exercise the Redemption Right among the Limited Partners.

                  (iii) The restrictions set forth in clauses (i) and (ii) above
shall continue in effect until such time as the Partnership is no longer
potentially subject to classification as a publicly traded partnership, as
defined in Code Section 7704, in the absence of such restrictions, as determined
by the General Partner in its discretion. The restrictions set forth in clauses
(i) and (ii) above, together with the restrictions on the Transfer of
Partnership Interests set forth in Section 11.2, are intended to limit transfers
of interests in the Partnership in such a manner as to permit the Partnership to
qualify for the safe harbors from treatment as a publicly traded partnership set
forth in Regulations Sections 1.7704-1(d), (e), (f) and (j) and shall be
construed and administered in accordance therewith. The General Partner may
modify the restrictions set forth in clauses (i) and (ii) above, and the
provisions of Section 11.2, from time to time in its discretion to ensure that
the Partnership complies and continues to comply with the Code and Regulations
requirements described above. Notwithstanding anything herein to the contrary,
the provisions of subparagraphs (i)-(iii) shall only apply if, and beginning
with the first day of the

                                       13
<PAGE>

first taxable year in which, the Partnership no longer qualifies for the Private
Placement PTP Exemption.

                  (iv)  A Limited Partner shall not be entitled to exercise
either a Redemption Right or any right to convert a Preference Unit into an OP
Unit if such exercise would (a) result in the total Common Shares and any other
ownership or beneficial interests in the General Partner being owned by fewer
than one hundred persons within the meaning of Code Section 856(a)(5); (b)
result in such Limited Partner or any other person owning, directly or
constructively under Code Section 856(d)(5), in excess of 9.8% of the total
Common Shares (and any other ownership or beneficial interests) in the General
Partner; (c) cause more than 50% of the value of the General Partner's Common
Shares (and any other ownership or beneficial interests) to be held by five or
fewer individuals and certain organizations under Code Section 856(h) and
542(a)(2); (d) cause the General Partner to own, directly or constructively, 10%
or more of the ownership interests of any person that is a tenant with respect
to any real property owned or constructively owned by the General Partner (so as
to prevent the application of Code Section 856(d)(2)); or (e) cause the
acquisition of Common Shares (and any other ownership or beneficial interests)
in the General Partner by such Limited Partner to be "integrated" with any other
distribution of interests in the General Partner for purposes of complying with
the registration provisions of the Securities Act of 1933. The General Partner
may modify the restrictions set forth in this Section 3.2(d)(iv) from time to
time in its discretion to ensure that the Partnership complies and continues to
comply with Code Section 856. The General Partner may, in its sole discretion,
waive the restrictions on redemption set forth in this Section 3.2(d)(iv);
provided, however, that in the event a restriction is waived, the redeeming
partner shall be paid the Cash Amount.

                  (v)   A Limited Partner shall not be entitled to exercise a
Redemption Right if it prejudices or affects the continuity of the Partnership
for purposes of Code Section 708. Prior to any such redemption described in the
preceding sentence, the General Partner may require an opinion of counsel
satisfactory to the General Partner to the effect that such redemption will not
cause adverse tax consequences to the nonredeeming Partners, and such Limited
Partner exercising the Redemption Right shall be responsible for paying said
counsel's fee for his opinion.

                  (vi)  A Limited Partner (i) shall not be entitled to exercise
a Redemption Right to the extent the ownership or right to acquire Common Shares
pursuant to such exchange by such Partner on the Specified Redemption Date would
cause such Partner or any other Person, or, in the opinion of counsel selected
by the General Partner, may cause such Partner or any other Person, to violate
the restrictions on ownership and transfer of Common Shares set forth in Article
VII of the General Partner's charter and (ii) shall have no rights under this
Agreement to acquire Common Shares which would otherwise be prohibited under the
General Partner's charter. To the extent any attempted exercise of a Redemption
Right would be in violation of this Section 3.2(d), it shall be null and void ab
initio and such Limited Partner shall not acquire any right or economic interest
in the cash otherwise payable upon such redemption or the Common Shares
otherwise issuable upon such exchange.

                                       14
<PAGE>

Provided, however, that the General Partner may exempt a Limited Partner from
the foregoing restrictions to the same extent, and under the same circumstances,
that the General Partner may waive similar restrictions pursuant to its Articles
of Incorporation.

            (e)   Notwithstanding the provisions of Section 3.2(c), a Limited
Partner that exercises the Redemption Right shall be deemed to have offered to
sell the OP Units described in the Notice of Redemption to the General Partner,
and the General Partner (or any designee thereof) may, in its sole and absolute
discretion, elect to purchase directly and acquire such OP Units by paying to
the Redeeming Partner either the Cash Amount or the REIT Shares Amount, as
elected by the General Partner or any designee thereof (each in its sole and
absolute discretion), on the Specified Redemption Date, whereupon the General
Partner or any designee thereof shall acquire the Partnership Interest offered
for redemption by the Redeeming Partner and shall be treated for all purposes of
this Agreement as the owner of such OP Units. If the General Partner or any
designee thereof shall elect to exercise its right to purchase OP Units under
this Section 3.2(e) with respect to a Notice of Redemption, it shall so notify
the Redeeming Partner within five Business Days after the receipt by the General
Partner of such Notice of Redemption. Unless the General Partner or any designee
thereof (each in its sole and absolute discretion) shall exercise its right to
purchase OP Units from the Redeeming Partner pursuant to this Section 3.2(e),
neither the General Partner nor any designee thereof shall have any obligation
to the Redeeming Partner or the Partnership with respect to such Redeeming
Partner's exercise of such Redemption Right. In the event that the General
Partner or any designee thereof shall exercise its right to purchase OP Units
with respect to the exercise of a Redemption Right in the manner described in
the first sentence of this Section 3.2(e), the Partnership shall have no
obligation to pay any amount to the Redeeming Partner with respect to such
Redeeming Partner's exercise of such Redemption Right, and each of the Redeeming
Partner, the Partnership, and the General Partner or any designee thereof, as
the case may be, shall treat the transaction between the General Partner or any
designee thereof, as the case may be, and the Redeeming Partner for federal
income tax purposes as a sale of the Redeeming Partner's OP Units to the General
Partner or any designee thereof. Each Redeeming Partner agrees to execute such
documents as the General Partner may reasonably require in connection with the
issuance of Common Shares upon exercise of the Redemption Right. Any OP Units
acquired by the General Partner pursuant to such Redemption Right shall, upon
and after such acquisition, be treated as a general partner interest.

            (f)   The General Partner shall at all times reserve and keep
available out of its authorized but unissued Common Shares, solely for the
purpose of effecting the exchange of OP Units for Common Shares, such number of
Common Shares as shall from time to time be sufficient to effect the redemption
of all outstanding OP Units not owned by the General Partner, and any Preference
Units not owned by the General Partner that are convertible into OP Units
(whether or not the conversion can then be effected). No Limited Partner shall,
by virtue of being the holder of one ore more OP Units and/or Preference Units
be deemed to be a shareholder of or have any other interest in the General
Partner. In the event of any change in the outstanding Common Shares of the
General Partner or its successor by reason of any share dividend, split,
recapitalization, merger, consolidation, combination, exchange of shares or
other similar corporate change other than the issuance of Rights, as further
described in Section 3.2(g) (a "Recapitalization"), the number of OP Units held
by each Partner shall be adjusted upward or downward to equal such number of
Common Shares of the General Partner (or as applicable, the

                                       15
<PAGE>

Common Shares or equivalent class of securities of the successor thereto) as
would have been held by the Partner immediately following the Recapitalization
if such Partner had held a number of Common Shares equal to such number of OP
Units immediately prior to such Recapitalization. In the event the General
Partner or any designee thereof acquires OP Units pursuant to such Section
3.2(e), the General Partner shall record the transfer on the books of the
Partnership so that the General Partner or any designee thereof, as applicable,
is thereupon the owner and holder of such OP Units. As is more particularly
described in Section 3.2(d)(iv), notwithstanding any other provisions of this
Section 3.2, a Limited Partner shall not have the right to exercise a Redemption
Right if, upon payment of the REIT Shares Amount to such Limited Partner, (i)
the General Partner would, as a result thereof, no longer qualify (or it would
be reasonably possible in the judgment of the General Partner that the General
Partner no longer would qualify) as a real estate investment trust under the
Code; or (ii) the payment of such REIT Shares Amount to the Limited Partner
would constitute or be reasonably possible in the judgment of the General
Partner to constitute a violation of applicable federal or state securities laws
or would violate any applicable provisions of the organizational documents of
the General Partner (including without limitation any restrictions on ownership
of securities of the General Partner set forth in the Articles of Incorporation
or Bylaws of the General Partner). In either such event, to the extent the
consequences described in (i) or (ii) could be eliminated by reasonable action
of the General Partner without any material detriment to the General Partner or
the Company and at the expense of such Limited Partner(s) requesting such
exchange, the General Partner or the General Partner shall take all such
reasonable action to effect the exchange of OP Units for Common Shares by such
Limited Partner(s) as herein provided.

            (g)   In the event that a Redeeming Partner exercises the Redemption
Right, and the General Partner or any designee thereof elects to make the
payment of the REIT Shares Amount to the Redeeming Partner referenced in
accordance with the first sentence of Section 3.2(e), and in the event that the
General Partner issues to all of its holders of Common Shares as of a certain
record date rights, options, warrants or convertible or exchangeable securities
entitling such shareholders to subscribe for or purchase Common Shares or any
other securities or property (collectively, "Rights"), with the record date for
such Rights issuance falling within the period starting on the date that the
General Partner receives the Redemption Notice from the Redeeming Partner and
ending on the day immediately preceding the date upon which the General Partner
or its designee delivers the Common Shares to the Redeeming Partner in exchange
for such Redeeming Partner's OP Units (the date upon which such exchange occurs
being referred to herein as the "Exchange Date"), which Rights will not be
distributed before the Exchange Date, then the amount payable by the General
Partner or its designee to the Redeeming Partner in exchange for its OP Units
under this Section 3.2 shall also include such Rights that the Redeeming Partner
would have received if it had been the owner of the Common Shares to be
delivered by the General Partner to the Redeeming Partner prior to the record
date for the issuance of the Rights (as the same may be expressed for any
purpose hereunder in a number of OP Units or Common Shares as determined by the
General Partner).

      3.3   ADDITIONAL FUNDS.

            (a)   No Partner shall be assessed or, except as otherwise provided
in this Agreement, be required to contribute additional funds or other property
to the Partnership. Any additional funds or other property required by the
Partnership, as determined by the General

                                       16
<PAGE>

Partner in its sole discretion, may, at the option of the General Partner and
without an obligation to do so (except as provided for in Section 3.3(b) below),
be contributed by the General Partner or any other Partner (provided such other
Partner is willing to do so and the General Partner consents thereto, each in
its sole and absolute discretion) as additional Capital Contributions. If and as
the General Partner or any other Partner makes additional Capital Contributions
to the Partnership, each such Partner shall receive additional Partnership
Interests as provided for in Section 3.2(b) above. The General Partner shall
also have the right (but not the obligation) to raise any additional funds
required for the Partnership in accordance with the provisions of Section 8.7(e)
below and/or by causing the Partnership to borrow the necessary funds from third
parties on such terms and conditions as the General Partner shall deem
appropriate in its sole discretion. If the General Partner elects to cause the
Partnership to borrow the additional funds, or if the Partnership issues a
guaranty, indemnity or similar undertaking in connection with the indebtedness
of the General Partner as aforesaid, in any such case one or more of the
Partnership's assets may be encumbered to secure the loan or undertaking. Except
as provided for in Section 3.3(c) below, no Limited Partner shall have the right
to make additional Capital Contributions to the Partnership without the prior
written consent of the General Partner.

            (b)   Except for (i) the capitalization of any wholly-owned entity
of the General Partner which is the general partner of a partnership having the
Partnership as a limited partner, (ii) the net proceeds generated by the
issuance of Other Securities that evidence debt (and are not equity securities)
that are loaned by the General Partner to the Partnership, and (iii) where the
General Partner determines that the net proceeds generated by the issuance of
Common Shares or Other Securities (whether for debt or equity) are to be
retained by the General Partner for a valid business reason consistent with the
purposes of the Partnership and such retention does not materially adversely
affect the Limited Partners, the net proceeds of any and all funds raised by or
through the General Partner through the issuance of Common Shares or Other
Securities shall be contributed to the Partnership as additional Capital
Contributions, and in such event the General Partner shall be issued additional
Units pursuant to Section 3.2(b) above.

            (c)   If the General Partner creates and administers a reinvestment
program in substantial conformance with a dividend reinvestment program which
may be available from time to time to holders of the Common Shares, each Limited
Partner shall have the right to reinvest any or all cash distributions payable
to it from time to time pursuant to this Agreement (subject to the restrictions
described in Article XI), by having some or all (as the Limited Partner elects)
of such distributions contributed to the Partnership as additional Capital
Contributions, and in such event the Partnership shall issue to each such
Limited Partner additional OP Units pursuant to Section 3.2(b)(iii) above, or
the General Partner, in its sole discretion, may elect to cause distributions
with respect to which a Limited Partner has elected reinvestment to be
contributed to the General Partner in exchange for the issuance of Common
Shares. At the option of the General Partner, such a program may also be made
available with respect to Preference Units.

      3.4   CAPITAL ACCOUNTS. A separate capital account ("Capital Account")
shall be maintained for each Partner.

            (a)   To each Partner's Capital Account there shall be added the
amount of cash and the Gross Asset Value of any property contributed by such
Partner to the Partnership

                                       17
<PAGE>

pursuant to any provision of this Agreement, such Partner's distributive share
of Profits and any items in the nature of income or gain which are specially
allocated pursuant to Section 6.3, Section 6.4 or Section 13.2(c) hereof, and
the amount of any Partnership liabilities assumed by such Partner or which are
secured by any Partnership property distributed to such Partner.

            (b)   From each Partner's Capital Account there shall be subtracted
the amount of cash and the Gross Asset Value of any Partnership property
distributed to such Partner pursuant to any provision of this Agreement, such
Partner's distributive share of losses and any items in the nature of expenses
or losses which are specially allocated pursuant to Section 6.3, Section 6.4 or
Section 13.2(c) hereof, and the amount of any liabilities of such Partner
assumed by the Partnership or which are secured by any property contributed by
such Partner to the Partnership.

            (c)   In the event all or a portion of a Partnership Interest is
transferred in accordance with the terms of this Agreement (including a transfer
of OP Units in exchange for Common Shares, pursuant to Section 3.2(e)), the
transferee shall succeed to the Capital Account of the transferor to the extent
it relates to the transferred Partnership Interest.

            (d)   In determining the amount of any liability for purposes of
Sections 3.4(a) and 3.4(b) above, there shall be taken into account Code Section
752(c) and any other applicable provisions of the Code and Regulations.

            (e)   This Section 3.4 and the other provisions of this Agreement
relating to the maintenance of Capital Accounts are intended to comply with
Regulations Section 1.704-1(b), and shall be interpreted and applied in a manner
consistent with such Regulations. In the event the General Partner shall
determine that it is prudent to modify the manner in which the Capital Accounts,
or any debits or credits thereto (including, without limitation, debits or
credits relating to liabilities which are secured by contributed or distributed
property or which are assumed by the Partnership, or the Partners) are computed
in order to comply with such Regulations, the General Partner may make such
modification, provided that it is not likely to have a material effect on the
amounts distributed to any Partner pursuant to Section 13.2 upon the liquidation
of the Partnership. The General Partner also shall (i) make any adjustments that
are necessary or appropriate to maintain equality between the Capital Accounts
of the Partners and the amount of Partnership capital reflected on the
Partnership's balance sheet, as computed for book purposes, in accordance with
Regulations Section 1.704-1(b)(2)(iv)(g), and (ii) make any appropriate
modifications in the event unanticipated events might otherwise cause this
Agreement not to comply with Regulations Section 1.704-1(b).

      3.5   INTEREST ON AND RETURN OF CAPITAL.

            (a)   No Partner shall be entitled to any interest on its Capital
Account or on its Capital Contributions to the Partnership.

            (b)   Except as expressly provided for in this Agreement, no Partner
shall have the right to demand or to receive the return of all or any part of
its Capital Contributions to the Partnership and there shall be no priority of
one Partner over another Partner as to the return of capital contributions or
withdrawals or distributions of profits and losses. No Partner shall have

                                       18
<PAGE>

the right to demand or receive property other than cash in return for the
contributions of such Partner to the Partnership.

      3.6   NEGATIVE CAPITAL ACCOUNTS. Subject to the provisions of any
guarantee or other written agreement between a Partner and the Partnership, no
Partner shall otherwise be required to pay to the Partnership any deficit or
negative balance which may exist in its Capital Account.

      3.7   LIMIT ON CONTRIBUTIONS AND OBLIGATIONS OF PARTNERS. Except as
provided in Sections 3.1, 3.2 and 3.3 (or the provisions of any guarantee or
other written agreement between a Partner and the Partnership), no Partner shall
be required to make any additional advances or contributions to or on behalf of
the Partnership or guarantee any obligations of the Partnership.

      3.8   REDEMPTION AND REPURCHASE OF UNITS. Notwithstanding any other
provision of this Agreement which may be contrary to this Section 3.8, in the
event of the proposed repurchase or redemption for cash by the General Partner
of (i) Common Shares or (ii) Other Securities with respect to which the
Partnership had previously issued Preference Units pursuant to Section
3.2(b)(iv) of this Agreement, then, in such event, the Partnership shall provide
cash to the General Partner concurrently with such repurchase or redemption or
for such purpose equal to the proposed repurchase or redemption price, and one
OP Unit owned by the General Partner (or, in the case of redemption or
repurchase by the General Partner of Other Securities contemplated by clause
(ii) above, one Preference Unit owned by the General Partner which had been
issued with respect to such Other Securities) shall be canceled with respect to
each Common Share (or share of Other Securities) so repurchased or redeemed.

      3.9   REDEMPTION AND REPURCHASE OF INTERESTS OWNED BY SKB CONTROLLED
ENTITIES. Notwithstanding any other provision of this Agreement which may be
contrary to this Section 3.9, if at any time the General Partner is not
sponsored by an SKB Controlled Entity, each SKB Controlled Entity may redeem all
or a portion of the Partnership Interests it owns at any time, or from time to
time. The redemption price of the portion of the Partnership Interest being
redeemed will be equal to the Cash Amount attributable to such Partnership
Interest, as the case may be. The holder may elect, at its option, to receive
cash or Common Shares (or a combination of same) in connection with such
redemption.

                                   ARTICLE IV

                           OFFICE AND REGISTERED AGENT

      4.1   PRINCIPAL OFFICE. The principal office of the Partnership is located
at 1211 SW Fifth Avenue, Suite 2250, Portland, Oregon 97204 or such other place
as the General Partner may from time to time designate by notice to the Limited
Partners. The Partnership may maintain offices at such other place or places
within or outside the State of Delaware as the General Partner may deem
advisable.

      4.2   REGISTERED OFFICE AND AGENT. The address of the registered office of
the Partnership in the State of Delaware is located at 9 East Loockerman St.,
Suite 1B, City of Dover, County of Kent, Delaware 19901 and the registered agent
for service of process on the

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<PAGE>

Partnership in the State of Delaware at such registered office is National
Registered Agents, Inc. or such other address or Person as may be designated by
the General Partner.

                                    ARTICLE V

                       PURPOSES AND POWERS OF PARTNERSHIP

      5.1   PURPOSES OF THE PARTNERSHIP. The objects and purposes of the
Partnership are to engage in any lawful business activities in which a
partnership formed under the Act may engage or participate, including without
limitation, either as a partner in a partnership or joint venture or otherwise:

            (a)   to purchase, own, maintain, mortgage, encumber, construct,
develop, equip, manage, lease, finance, operate, dispose of or otherwise deal
with real property, interests in real or personal property or mortgages secured
by real property.

            (b)   acquire own, hold for investment and ultimately dispose of
general and limited partner interests, and stock, warrants, options or other
equity and debt interests in Persons, and exercise all rights and powers granted
to the owner of any such interests

            (c)   make any type of investment and engage in any other lawful act
or activity for which limited partnerships may be formed under the Act, and by
such statement all lawful acts and activities shall be within the purposes of
the Partnership

            (d)   to undertake such other activities as may be necessary,
advisable, desirable or convenient to the business of the Partnership; and

            (e)   to engage in such other ancillary activities as shall be
necessary or desirable to effectuate the foregoing purposes;

provided, however, that such business shall be limited to and conducted in such
a manner as to permit the General Partner at all times to be classified as a
REIT, unless the General Partner determines not to qualify as a REIT or ceases
to qualify as a REIT for reasons other than the conduct of the business of the
Partnership.

      5.2   POWERS. The Partnership is empowered to do any and all things not
prohibited under the Act to accomplish the purposes and business of the
Partnership.

      5.3   REIT REQUIREMENTS. Each Limited Partner understands and acknowledges
that the General Partner intends to elect to be treated as a real estate
investment trust ("REIT") under Code Sections 856 through 860. Each Limited
Partner further understands and acknowledges that in order to maintain its
status as a REIT, the General Partner must comply with numerous and complex
rules and regulations set forth in the Code and the Regulations, many of which
are applied on a quarterly and/or annual basis (the "REIT Requirements"), and
that the management and operation of the Partnership will have a material effect
on the ability of the General Partner to continue to maintain its status as a
REIT. Accordingly, notwithstanding any other provision of this Agreement or any
non-mandatory provision of the Act, the Partnership shall not take any action
which (or fail to take any action, the omission of which) (i) could adversely
affect the

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<PAGE>

ability of the General Partner to qualify or continue to qualify as a REIT, (ii)
could subject the General Partner to any additional taxes under Code Section 857
or Code Section 4981 or other potentially adverse consequences under the Code,
or (iii) otherwise could cause the General Partner to violate the REIT
Requirements, specifically including, but not limited to, restrictions on
Redemption Rights in Section 3.2(d)(iv). In addition, notwithstanding any other
provision of this Agreement or any non-mandatory provision of the Act, any
action of the General Partner on behalf of the Partnership or any decision of
the General Partner to refrain from acting on behalf of the Partnership,
undertaken in the General Partner's business judgment that such action or
omission is necessary or advisable in order (x) to protect the ability of the
General Partner to continue to qualify as a REIT or (y) to avoid the General
Partner incurring any taxes under Code Section 857 or Code Section 4981, is
expressly authorized under this Agreement and is approved by all of the Limited
Partners.

In connection with the foregoing, and without limiting the General Partner's
right in its sole discretion to cease qualifying as a REIT, the Partners
acknowledge that the General Partner's current status as a REIT inures to the
benefit of all the Partners and not solely the General Partner.

                                   ARTICLE VI

                                   ALLOCATIONS

      6.1   PROFITS.

            (a)   After giving effect to the special allocations set forth in
Sections 6.3, 6.4, and 13.2(c), Profits for any fiscal year other than Capital
Transactions Gains shall be allocated as follows:

                  (i)   first, gross profits shall be allocated to the General
Partner, until the cumulative amount of Profits allocated pursuant to this
Section 6.1(a)(i) equal the cumulative Losses allocated to the General Partner
pursuant to Section 6.2 hereof; and

                  (ii)  thereafter, remaining Profits shall be allocated among
the Partners in proportion to their respective Percentage Interests.

            (b)   After giving effect to the allocations set forth in Sections
6.3, 6.4 and 13.2(c), Capital Transaction Gains shall be computed separately
with respect to each property and shall be allocated among the Partners as
follows:

                  (i)   first, among the Partners in proportion to, and to the
extent of, any deficit balance in each such Partner's Capital Account;

                  (ii)  second, to the General Partner in the minimum amount
needed so as to cause its Capital Account balance to equal the product of the
Percentage Interest attributable to its Partnership Interest and the aggregate
Capital Account balances of all the Partners (after giving effect to the
allocation in this clause (ii)); and

                                       21
<PAGE>

                  (iii) thereafter, among the Partners in proportion to their
respective Percentage Interests.

            (c)   In the event that the Partnership issues additional Units to
the General Partner or any Limited Partner pursuant to Section 3.2 hereof, the
General Partner shall make such revisions to this Section 6.1 as it determines
are necessary to reflect the terms of the issuance of such additional Units,
including such revisions as are needed to ensure that such allocations (i) will
comply with the terms of Regulations Sections 1.704-1 and -2 and Code Section
514(c)(9)(E), (ii) will properly reflect the varying interests of the Partners
in the Partnership, and (iii) will cause the Capital Accounts of the Partners
held by them to be in the ratios in which the Partners are entitled to receive
distributions with respect to their Partnership Interests pursuant to Article
VII hereof.

      6.2   LOSSES.

            (a)   After giving effect to the special allocations set forth in
Sections 6.3, 6.4, and 13.2(c), all Losses (including Capital Transaction
Losses, which shall be computed and allocated separately with respect to each
property) shall be allocated among the Partners in proportion to their
respective Percentage Interests.

            (b)   The Losses allocated pursuant to Section 6.2(a) above shall
not exceed the maximum amount of Losses that can be so allocated without causing
any Limited Partner to have an Adjusted Capital Account Deficit at the end of
any fiscal year. All Losses in excess of the limitations set forth in this
Section 6.2(b) shall be allocated among the other Partners in proportion to the
number of OP Units held by each such other Partner.

            (c)   In the event that the Partnership issues additional Units to
the General Partner or any Limited Partner pursuant to Section 3.2 hereof, the
General Partner shall make such revisions to this Section 6.2 as it determines
are necessary to reflect the terms of the issuance of such additional Units,
including such revisions as are needed to ensure that such allocations (i) will
comply with the terms of Regulations Sections 1.704-1 and -2 and Code Section
514(c)(9)(E), (ii) will properly reflect the varying interests of the Partners
in the Partnership, and (iii) will cause the Capital Accounts of the Partners to
be in the ratios in which the Partners are entitled to receive distributions
with respect to their Partnership Interests pursuant to Article VII hereof.

      6.3   SPECIAL ALLOCATIONS. The following special allocations shall be made
in the following order:

            (a)   Except as otherwise provided in Regulations Section
1.704-2(f), and notwithstanding any other provision of this Article VI, if there
is a net decrease in Partnership Minimum Gain during any fiscal year, each
Partner shall be specially allocated items of Partnership income and gain for
such fiscal year (and, if necessary, subsequent fiscal years) in an amount equal
to such Partner's share of the net decrease in Partnership Minimum Gain,
determined in accordance with Regulations Section 1.704-2(g). The items to be so
allocated shall be determined in accordance with Regulations Sections
1.704-2(f)(6) and 1.704-2(j)(2). This

                                       22
<PAGE>

Section 6.3(a) is intended to comply with the minimum gain chargeback
requirement in Regulations Section 1.704-2(f) and shall be interpreted
consistently therewith.

            (b)   Except as otherwise provided in Regulations Section
1.704-2(i)(4), and notwithstanding any other provision of this Article VI, if
there is a net decrease in Partner Nonrecourse Debt Minimum Gain attributable to
a Partner Nonrecourse Debt during any Partnership fiscal year, each Partner who
has a share of the Partner Nonrecourse Debt Minimum Gain attributable to such
Partner Nonrecourse Debt, determined in accordance with Regulations Section
1.704-2(i)(5), shall be specially allocated items of Partnership income and gain
for such fiscal year (and, if necessary, subsequent fiscal years) in an amount
equal to such Partner's share of the net decrease in Partner Nonrecourse Debt
Minimum Gain attributable to such Partner Nonrecourse Debt, determined in
accordance with Regulations Section 1.704-2(i)(4). The items to be so allocated
shall be determined in accordance with Regulations Sections 1.704-2(i)(4) and
1.704-2(i)(2). This Section 6.3(b) is intended to comply with the minimum gain
chargeback requirement in Regulations Section 1.704-2(i)(4) and shall be
interpreted consistently therewith.

            (c)   In the event any Partner unexpectedly receives any
adjustments, allocations, or distributions described in Regulations Sections
1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5), or 1.704-1(b)(2)(ii)(d)(6),
items of Partnership income and gain shall be specially allocated to each such
Partner in an amount and manner sufficient to eliminate, to the extent required
by the Regulations, the Adjusted Capital Account Deficit of such Partner as
quickly as possible, provided that an allocation pursuant to this Section 6.3(c)
shall be made only if and to the extent that such Partner would have an Adjusted
Capital Account Deficit after all other allocations provided for in this Article
VI have been tentatively made, as if this Section 6.3(c) were not in this
Agreement.

            (d)   In the event any Partner has a deficit Capital Account at the
end of any Partnership fiscal year which is in excess of the sum of (i) the
amount such Partner is obligated to restore pursuant to any provision of this
Agreement, and (ii) the amount such Partner is deemed to be obligated to restore
pursuant to the penultimate sentences of Regulations Sections 1.704-2(g)(1) and
1.704-2(i)(5), each such Partner shall be specially allocated items of
Partnership income and gain in the amount of such excess as quickly as possible,
provided that an allocation pursuant to this Section 6.3(d) shall be made only
if and to the extent that such Partner would have a deficit Capital Account
after all other allocations provided for in this Article VI have been made as if
Section 6.3(c) hereof and this Section 6.3(d) were not in the Agreement.

            (e)   If and to the extent Partners receive preferred distributions
from the Partnership with respect to their Units (other than distributions
pursuant to Section 13.2(c) in final liquidation of the Partnership), each such
Partner shall be allocated Partnership gross income in an amount equal to the
amount of preferred distributions received with respect to such Units, prior to
any allocations of Profit and Loss pursuant to Sections 6.1 and 6.2 above. For
purposes of this Section 6.3(e), any payment with respect to a Preference Unit
that, under the applicable Preference Unit Term Sheet, constitutes a payment in
redemption of such Preference (and a return of the Partner's Capital
Contribution with respect to such Preference Unit) shall not result in a special
allocation of gross income to the Partner receiving such payments under this
Section 6.3(e), except to the extent such payment is specifically attributable
to accrued and

                                       23
<PAGE>

unpaid preferred distributions with respect to such Preference Unit provided for
in such Preference Unit Term Sheet.

            (f)   Nonrecourse Deductions for any fiscal year shall be allocated
among the Partners in accordance with their respective Percentage Interests.

            (g)   Any Partner Nonrecourse Deductions for any fiscal year shall
be specially allocated to the Partner who bears the economic risk of loss with
respect to the Partner Nonrecourse Debt to which such Partner Nonrecourse
Deductions are attributable, in accordance with Regulations Section
1.704-2(i)(1).

            (h)   To the extent an adjustment to the adjusted tax basis of any
Partnership asset pursuant to Code Section 734(b) is required, pursuant to
Regulations Section 1.704-1(b)(2)(iv)(m)(4), to be taken into account in
determining Capital Accounts as the result of a distribution to a Partner in
complete liquidation of its interest in the Partnership, the amount of such
adjustment to Capital Accounts shall be treated as an item of gain (if the
adjustment increases the basis of the asset) or loss (if the adjustment
decreases such basis) and such gain or loss shall be specifically allocated to
the Partner to whom such distribution was made.

      6.4   CURATIVE ALLOCATIONS. The allocations set forth in Sections 6.2(c),
6.3(a), 6.3(b), 6.3(c), 6.3(d), 6.3(f), 6.3(g), and 6.3(h) above (the
"Regulatory Allocations") are intended to comply with certain requirements of
the Regulations under Code Section 704(b). It is the intent of the Partners
that, to the extent possible, all Regulatory Allocations shall be offset either
with other Regulatory Allocations or with special allocations of other items of
Partnership income, gain, loss, or deduction pursuant to this Section 6.4.
Therefore, notwithstanding any other provision of this Article VI (other than
the Regulatory Allocations), the General Partner shall make such offsetting
special allocations of Partnership income, gain, loss, or deduction in whatever
manner it determines appropriate so that, after such offsetting allocations are
made, each Partner's Capital Account balance is, to the extent possible, equal
to the Capital Account balance such Partner would have had if the Regulatory
Allocations were not part of the Agreement and all Partnership items were
allocated pursuant to Section 6.1(a)(ii) and 6.2(a) (subject, however, to
Section 6.3(e) above). In exercising its discretion under this Section 6.4, the
General Partner shall take into account future Regulatory Allocations under
Section 6.3(a) and 6.3(b) that, although not yet made, are likely to offset
other Regulatory Allocations previously made under Sections 6.3(f) and 6.3(g).

      6.5   TAX ALLOCATIONS; CODE SECTION 704(c).

            (a)   Income, gain, loss, and deduction with respect to any property
contributed to the capital of the Partnership shall, solely for tax purposes, be
allocated among the Partners so as to take account of any variation between the
adjusted basis of such property to the Partnership for Federal income tax
purposes and its initial Gross Asset Value.

            (b)   In the event the Gross Asset Value of any Partnership asset is
adjusted pursuant to the definition of "Gross Asset Value" contained in Article
II above, subsequent allocations of income, gain, loss and deduction with
respect to such asset shall take account of

                                       24
<PAGE>

any variation between the adjusted basis of such asset for Federal income tax
purposes and its Gross Asset Value.

            (c)   The portion of any gain recognized by the Partnership on the
disposition of property which is classified as ordinary income under Sections
751, 1245 or 1250 of the Code, or which is classified as "unrecaptured section
1250 gain" under Section 1(h)(7) of the Code, shall be allocated among the
Partners in the ratio in which the deductions giving rise to such ordinary
income or unrecaptured section 1250 gain were allocated; provided, however, that
the amount of ordinary income or unrecaptured section 1250 gain so allocated
shall not exceed the gain from such sale or disposition that is so allocable to
the Partner.

            (d)   Any elections or other decisions relating to the allocations
provided under this Section 6.5 shall be made by the General Partner using any
permissible manner under the Code or the Regulations that the General Partner
may elect in its sole discretion. Allocations pursuant to this Section 6.5 are
solely for purposes of Federal, state, and local taxes and shall not affect, or
in any way be taken into account in computing, any Partner's Capital Account or
share of Profits, Losses, other items, or distributions pursuant to any
provision in this Agreement.

                                  ARTICLE VII

                         CASH AVAILABLE FOR DISTRIBUTION

      7.1   DEFINITION OF AVAILABLE CASH. As used in this Agreement, "Available
Cash" shall mean and be defined as all cash receipts of the Partnership from
whatever source during the period in question in excess of all items of
Partnership expense (other than non-cash expenses such as depreciation) and
other cash needs of the Partnership, including, without limitation, investments
by the Partnership, amounts paid by the Partnership as principal on debts and
advances during such period, capital expenditures, payments to any dealer
manager, advisor or property manager under any dealer manager, advisory and/or
property management agreement, other fees and expense reimbursements, funds used
for redemptions, and any reserves (as determined by the General Partner)
established or increased during such period. In the discretion of the General
Partner, but subject to Section 5.3, reserves may include cash held for future
acquisitions.

      7.2   TIMING AND PRIORITY OF DISTRIBUTIONS OF AVAILABLE CASH. Available
Cash shall be distributed to or for the benefit of the Partners of record as of
the applicable Record Date determined by the General Partner in its sole and
absolute discretion but no less frequently than annually. All such distributions
shall, subject to the rights of any holder of Preference Units, be distributed
among the Partners in proportion to their respective Percentage Interests as of
the applicable Record Date.

      7.3   CONSENT TO ALLOCATIONS AND DISTRIBUTIONS. Each of the Partners
hereby consents to the allocations and distributions provided for in this
Agreement.

      7.4   RIGHT TO LIMIT DISTRIBUTIONS. The right of any Partner to receive
distributions of any nature pursuant to the terms of this Agreement shall be
subject to the terms of any

                                       25
<PAGE>

agreement between such Partner and the Partnership limiting, restricting or
providing rights of set-off with respect to such distributions.

                                  ARTICLE VIII

                            MANAGEMENT OF PARTNERSHIP

      8.1   GENERAL PARTNER.

            (a)   The General Partner shall be the sole manager of the
Partnership business, and shall have the right and power to make all decisions
and take any and every action with respect to the property, the business and
affairs of the Partnership and shall have all the rights, power and authority
generally conferred by law, or necessary, advisable or consistent with
accomplishing the purposes of the Partnership. All such decisions or actions
made or taken by the General Partner hereunder shall be binding upon all of the
Partners and the Partnership.

            (b)   The powers of the General Partner to manage the Partnership
business shall include, without limitation, the power and authority to, directly
or indirectly:

                  (i)   operate any business normal or customary for the owner
of or investor in commercial property of the type held by the Partnership;

                  (ii)  perform any and all acts necessary or appropriate to the
operation of the Partnership's assets, including, but not limited to, preparing,
negotiating, executing and delivering leases and rental agreements with regard
to real and personal property owned by the Partnership, preparing applications
for rezoning, preparing objections to rezoning of other property and
establishing bank accounts in the name of the Partnership;

                  (iii) improve, renovate and/or perform construction activities
with regard to the properties owned by the Partnership and to retain such
contractors, subcontractors and other persons or entities as may be required in
connection with such activities;

                  (iv)  procure and maintain such insurance as may be available
in such amounts and covering such risks as are deemed appropriate by the General
Partner;

                  (v)   take and hold all real, personal and mixed property of
the Partnership in the name of the Partnership or in the name of a nominee;

                  (vi)  negotiate, execute and deliver agreements on behalf of
and in the name of the Partnership;

                  (vii) borrow money (whether on a secured or unsecured basis),
finance and refinance the assets of the Partnership or any part thereof or
interest therein, and in connection therewith, issue notes, bonds, securities
and other undertakings and evidences of indebtedness and documents related
thereto (including, without limitation, guaranties, indemnities and similar
undertakings to support loans obtained or debt securities issued by the General
Partner or any SKB Controlled Entity);

                                       26
<PAGE>

                  (viii) coordinate all accounting and clerical functions of the
Partnership and employ such accountants, lawyers, property managers, leasing
agents and other management or service personnel as may from time to time be
required to carry on the business of the Partnership;

                  (ix)  acquire any assets, and encumber, sell, assign,
transfer, ground lease or otherwise dispose of any or all of the assets of the
Partnership, or any part thereof or interest therein including, without
limitation, by way of any Unit dividend, split, recapitalization, merger,
consolidation, combination, exchange of Units or other similar Partnership
organizational change;

                  (x)   organize one or more partnerships, corporations, limited
liability companies or other business entities which are controlled, directly or
indirectly, by the Partnership and make any capital contributions (in cash or in
kind) required pursuant to the organizational documents or subscription
agreements relating to any such partnerships, corporations, limited liability
companies or other business entities;

                  (xi)  to prosecute, defend, arbitrate or compromise any and
all claims or liabilities in favor of or against the Partnership, on such terms
and in such manner as the General partner may reasonably determine, and
similarly to prosecute, settle, or defend litigation with respect tot he
Partners, the Partnership or the Partnership's assets; and

                  (xii) establish the date (the "Record Date") for the purpose
of making any proper determination in connection with, but not limited to, the
following matters: (a) which Partners are entitled to receive distributions, (b)
consent to any matter for which the consent of Partners is permitted or required
under any provision hereof, or (c) otherwise when Partners are allocated rights
hereunder.

            (c)   Except as otherwise provided herein, to the extent the duties
of the General Partners require expenditures of funds to be paid to third
parties, the General Partner shall not have any obligations hereunder except to
the extent that partnership funds are reasonably available to it for the
performance of such duties, and nothing herein contained shall be deemed to
authorize or require the General Partner, in its capacity as such, to expend its
individual funds for payment to third parties or to undertake any individual
liability or obligation on behalf of the Partnership.

      8.2   DELEGATION OF AUTHORITY. The General Partner may delegate any or all
of its powers, rights, and obligations hereunder, and may appoint, employ,
contract or otherwise deal with any Person for the transaction of the business
of the Partnership, which Person may, under supervision of the General Partner,
perform any acts or services for the Partnership as the General Partner may
approve.

      8.3   LIMITED PARTNERS. The Limited Partners shall have no right or
authority to act for or to bind the Partnership and no Limited Partner (other
than the General Partner if the General Partner is also a Limited Partner) shall
participate in the conduct or control of the Partnership's affairs or business.

                                       27
<PAGE>

      8.4   LIABILITY OF GENERAL PARTNER. The General Partner shall not be
liable or accountable, in damages or otherwise, to the Partnership or to any
other Partner for any error of judgment or for any mistakes of fact or law or
for anything which it may do or refrain from doing hereafter in connection with
the business and affairs of the Partnership except (i) in the case of fraud,
willful misconduct (such as an intentional breach of fiduciary duty or an
intentional breach of this Agreement) or gross negligence, and (ii) for other
breaches of this Agreement, but the liability of the General Partner under this
clause (ii) shall be limited to its interest in the Partnership as more
particularly provided for in Section 8.8. The General Partner shall not have any
personal liability for the return of any Limited Partner's Capital
Contributions.

      8.5   INDEMNITY. The Partnership shall indemnify and shall hold the
General Partner (and the officers, directors and employees and agents thereof,
including, without limitation, any advisor retained by the General Partner and
any employees or affiliates thereof) harmless from any liability, loss, cost or
damage, including without limitation reasonable legal fees and court costs,
incurred by it by reason of anything it may do or refrain from doing hereafter
for and on behalf of the Partnership or in connection with its business or
affairs to the maximum extent permitted by Delaware law; provided, however, that
the Partnership shall not be required to indemnify (i) the General Partner for
any liability, loss, cost or damage which it might incur as a result of its
fraud, willful misconduct or gross negligence in the performance of its duties
hereunder, (ii) any officer or director (other than "Independent Directors", as
such term is defined in the Articles of Incorporation) of the General Partner
for any liability, loss, cost or damage which it might incur as a result of
misconduct or negligence of such person, and (iii) any Independent Directors of
the General Partner for any liability, loss, cost or damage which it might incur
as a result of willful misconduct or gross negligence of such person. In
addition, the General Partner shall be entitled to reimbursement from the
Partnership for any amounts paid by it in satisfaction of indemnification
obligations owed by the General Partner to present or former officers or
directors of the General Partner or its predecessors, as provided for in or
pursuant to the Articles of Incorporation and Bylaws of the General Partner. The
right of indemnification set forth in this Section 8.5 shall be in addition to
any rights to which the person or entity seeking indemnification may otherwise
be entitled and shall inure to the benefit of the successors and assigns of any
such person or entity. No Partner shall be personally liable with respect to any
claim for indemnification pursuant to this Section 8.5, but such claim shall be
satisfied solely out of assets of the Partnership.

      8.6   OTHER ACTIVITIES OF PARTNERS AND AGREEMENTS WITH RELATED PARTIES.
Except as may otherwise be agreed to in writing, each Limited Partner, and its
affiliates and any officer, director or shareholder of the General Partner,
shall be free to engage in, to conduct or to participate in any business or
activity whatsoever, including, without limitation, the acquisition,
development, management and exploitation of real and personal property (other
than property of the Partnership), without any accountability, liability or
obligation whatsoever to the Partnership or to any other Partner, even if such
business or activity competes with or is enhanced by the business of the
Partnership. The General Partner, in the exercise of its power and authority
under this Agreement, may contract and otherwise deal with or otherwise obligate
the Partnership to entities in which the General Partner or any one or more of
the officers, directors or shareholders of the General Partner may have an
ownership or other financial interest, whether direct or indirect.

                                       28
<PAGE>

      8.7   OTHER MATTERS CONCERNING THE GENERAL PARTNER.

            (a)   The General Partner shall be protected in relying, acting or
refraining from acting on any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, bond, debenture, or other
paper or document believed by it to be genuine and to have been executed or
presented by the proper party or parties.

            (b)   The General Partner may exercise any of the powers granted or
perform any of the duties imposed by this Agreement either directly or through
agents. The General Partner may consult with legal counsel, accountants,
appraisers, management consultants, investment bankers and other consultants
selected by it, each of whom may serve as consultants for the Partnership. An
opinion by any consultant on a matter which the General Partner believes to be
within its professional or expert competence shall be full and complete
protection as to any action taken or omitted by the General Partner based on the
opinion and actions taken or omitted in accordance therewith. The General
Partner shall not be responsible for the misconduct, negligence, acts or
omissions of any consultant or contractor of the Partnership or of the General
Partner, and shall assume no obligation other than to use due care in the
selection of all consultants and contractors.

            (c)   No mortgagee, grantee, creditor or any other person dealing
with the Partnership shall be required to investigate the authority of the
General Partner or secure the approval of or confirmation by any Limited Partner
of any act of the General Partner in connection with the conduct of any ordinary
or extraordinary Partnership business.

            (d)   The General Partner may retain such persons or entities as it
shall determine (including the General Partner or any entity in which the
General Partner shall have an interest or with which it is affiliated) to
provide services to or on behalf of the Partnership. The General Partner shall
be entitled to reimbursement from the Partnership for its out-of-pocket expenses
(including, without limitation, amounts paid or payable to the General Partner
or any entity in which the General Partner shall have an interest or with which
it is affiliated) incurred in connection with Partnership business. Such
expenses shall be deemed to include without limitation those expenses required
in connection with the administration of the Partnership such as the maintenance
of Partnership books and records, management of the Partnership property and
assets and preparation of information respecting the Partnership needed by the
Partners in the preparation of their individual tax returns.

            (e)   The General Partner may loan to the Partnership the net
proceeds of loans obtained or debt securities issued by the General Partner so
long as the terms of such loan to the Partnership are substantially equivalent
to the corresponding loan obtained or debt securities issued by the General
Partner, provided, however, that the General Partner shall not be obligated to
lend the net proceeds of any such loan or debt securities to the Partnership in
a manner that would be inconsistent with the General Partner's ability to remain
qualified as a REIT.

      8.8   PARTNER EXCULPATION. Except for fraud, willful misconduct and gross
negligence, no Partner shall have any personal liability whatsoever, whether to
the Partnership or to any other Partner, for the debts or liabilities of the
Partnership or its obligations hereunder, and the full recourse of any Partner
shall be limited to the interest of that Partner in the Partnership. To

                                       29
<PAGE>

the fullest extent permitted by law, no officer, director or shareholder of the
General Partner shall be liable to the Partnership for money damages except for
(i) active and deliberate dishonesty established by a final judgment, order or
decree of a court of competent jurisdiction or (ii) actual receipt of an
improper benefit or profit in money, property or services. Without limitation of
the foregoing, and except for fraud, willful misconduct and gross negligence, no
property or assets of any Partner, other than its interest in the Partnership,
shall be subject to levy, execution or other enforcement procedures for the
satisfaction of any judgment (or other judicial process) in favor of any other
Partners and arising out of, or in connection with, this Agreement. No advisor,
trustee, manager, trust manager, member, director, officer, partner, employee,
beneficiary, shareholder, participant or agent of any Partner (or of any partner
of a Partner) shall be personally liable in any matter or to any extent under or
in connection with this Agreement, and the Partnership, each Partner and their
respective successors and assigns shall look solely to the interest of the other
Partner in the Partnership for the payment of any claim or for any performance
hereunder.

      8.9   GENERAL PARTNER EXPENSES AND LIABILITIES. The Partnership will pay
or reimburse the General Partner for all ongoing accounting and administrative
expenses of the General Partner so that, absent extraordinary circumstances, the
General Partner will not bear any expenses beyond those borne by the
Partnership. The Partnership shall pay all out-of-pocket costs and expenses
(including legal, accounting, tax, consulting and other professional fees and
expenses and travel and entertainment expenses) incurred by the Partnership, the
General Partner, and the General Partner and its Affiliates in connection with
the structuring and organization of the Partnership and the General Partner and
the offering and sale of Units and Common Shares and Other Securities.

      8.10  LIMITATION TO PRESERVE REIT STATUS. To the extent that any amount
paid or credited to the General Partner or its officers, directors, employees or
agents pursuant to Section 8.5 or Section 8.9 would constitute gross income to
the General Partner for purposes of Sections 856(c)(2) or 856(c)(3) of the Code
(a "General Partner Payment") then, notwithstanding any other provision of this
Agreement, the amount of such General Partner Payments for any fiscal year shall
not exceed the lesser of:

            (a)   an amount equal to the excess, if any, of (a) 4.17% of the
General Partner's total gross income (but not including the amount of any
General Partner Payments) for the fiscal year which is described in subsections
(A) through (H) of Section 856(c)(2) of the Code over (b) the amount of gross
income (within the meaning of Section 856(c)(2) of the Code) derived by the
General Partner from sources other than those described in subsections (A)
through (H) of Section 856(c)(2) of the Code (but not including the amount of
any General Partner Payments); or

            (b)   an amount equal to the excess, if any, of (a) 25% of the
General Partner's total gross income (but not including the amount of any
General Partner Payments) for the fiscal year which is described in subsections
(A) through (I) of Section 856(c)(3) of the Code over (b) the amount of gross
income (within the meaning of Section 856(c)(3) of the Code) derived by the
General Partner from sources other than those described in subsections (A)
through (I) of Section 856(c)(3) of the Code (but not including the amount of
any General Partner Payments);

                                       30
<PAGE>

provided, however, that General Partner Payments in excess of the amounts set
forth in subparagraphs (i) and (ii) above may be made if the General Partner, as
a condition precedent, obtains an opinion of tax counsel that the receipt of
such excess amounts would not adversely affect the General Partner's ability to
qualify as a REIT. To the extent General Partner Payments may not be made in a
year due to the foregoing limitations, such General Partner Payments shall carry
over and be treated as arising in the following year, provided, however, that
such amounts shall not carry over for more than five years, and if not paid
within such five year period, shall expire; provided further, that (i) as
General Partner Payments are made, such payments shall be applied first to carry
over amounts outstanding, if any, and (ii) with respect to carry over amounts
for more than one Partnership year, such payments shall be applied to the
earliest Partnership year first.

                                   ARTICLE IX

                                     BANKING

      9.1   BANK ACCOUNTS. The funds of the Partnership not otherwise invested
shall be kept in accounts designated by the General Partner and all withdrawals
therefrom shall be made on such signature or signatures as shall be designated
by the General Partner.

      9.2   INVESTMENT OF FUNDS. All deposits and other funds not needed in the
operation of the business of the Partnership may be invested by the General
Partner in investment grade instruments (or investment companies whose portfolio
consists primarily thereof), government obligations, certificates of deposit,
bankers' acceptances, and municipal notes and bonds. The funds of the
Partnership shall not be commingled with the funds of any other Person except
for such commingling as may necessarily result from an investment in those
investment companies permitted by this Section 9.2.

                                   ARTICLE X

                                   ACCOUNTING

      10.1  FISCAL YEAR. The fiscal year and taxable year of the Partnership
(the "fiscal year") shall end on the last day of December of each year, unless
another fiscal year end is selected by the General Partner.

      10.2  BOOKS OF ACCOUNT. The Partnership books of account shall be
maintained at the principal office designated in Article IV or at such other
locations and by such person or persons as may be designated by the General
Partner. The Partnership shall pay the expense of maintaining its books of
account. Each Partner shall have, during reasonable business hours and upon
reasonable prior notice, access to the books of the Partnership and in addition,
at its expense, shall have the right to copy such books. The General Partner, at
the expense of the Partnership, shall cause to be prepared and distributed to
the Partners annual financial data sufficient to reflect the status and
operations of the Partnership and its assets and a properly completed Schedule
K-1.

                                       31
<PAGE>

      10.3  METHOD OF ACCOUNTING. The Partnership books of account shall be
maintained and kept, and its income, gains, losses and deductions shall be
accounted for, in accordance with generally accepted accounting principles
consistently applied, or such other method of accounting as may be adopted
hereafter by the General Partner.

      10.4  TAX MATTERS.

            (a)   The General Partner is hereby designated the Tax Matters
Partner (hereinafter referred to as the "TMP") of the Partnership and shall have
all rights and obligations of the TMP under the Code. The General Partner shall
have the right to retain professional assistance in respect of any audit of the
Partnership. The Partnership shall reimburse the TMP for any and all
out-of-pocket costs and expenses (including attorneys' and accountants' fees)
incurred or sustained by it in its capacity as TMP. The Partnership shall
indemnify, defend and hold the TMP harmless from and against any loss,
liability, damage, cost or expense (including attorneys' and accountants' fees)
sustained or incurred as a result of any act or decision concerning the
Partnership tax matters and within the scope of its responsibility as TMP. If
the Partnership is the subject of an income tax audit by any federal, state,
local or foreign authority, then to the extent the Partnership is treated as an
entity for purposes of the audit, including administrative settlement and
judicial review, the TMP shall be authorized to act for, and its decision shall
be final and binding upon, the Partnership and each Partner.

            (b)   The General Partner shall take such steps as are necessary to
ensure that the Partnership is taxed as a partnership under the Code. Subject
to the preceding sentence, the General Partner shall have the exclusive right to
make any determination whether the Partnership shall make available elections
(including any election pursuant to Code Section 754 to adjust the tax basis of
Partnership assets) for federal, state, or local tax purposes, and the General
Partner shall be absolved from all liability and other consequences from its
making or failing to make any such election. All decisions and other matters
concerning the computation and allocation or tax items and attributes which are
not otherwise specifically provided for by the terms of this Agreement shall be
determined by the General Partner, and the General Partner shall be absolved
from all liability and other consequences from any such decisions which are made
in good faith.

            (c)   The General Partner shall take all such actions as are
reasonably necessary for the Partnership to comply with any withholding or
comparable requirements under federal, state, local and foreign law and shall
remit any amounts withheld to, and file required forms with, the applicable
taxing jurisdictions. All amounts withheld from distributions shall be treated
as having been distributed to the Partner with respect to whom the withholding
was made. Any amounts that are required to be withheld by the Partnership with
respect to a Partner which are in excess or in advance of distributions to such
Partnership shall be paid over by such Partner to the Partnership. Each Partner
agrees to furnish the Partnership with such representations and forms as the
General Partner shall reasonably request to assist in complying with the
Partnership's withholding obligations. A Partner subject to withholding shall
pay to or reimburse the Partnership for taxes, related interest and penalties,
and all other costs and expenses incurred by the Partnership in connection with
such withholding obligation, except for interest, penalties or costs (but not
taxes) that are incurred as a result of the gross negligence or willful
misconduct of the Partnership or the General Partner

                                       32
<PAGE>

                                   ARTICLE XI

                       TRANSFERS OF PARTNERSHIP INTERESTS

      11.1  GENERAL PARTNER. The General Partner may not Transfer its interest
in the Partnership without the consent of a Majority-in-Interest of the Limited
Partners unless (i) the Transfer of such interest is to an SKB Controlled Entity
or to an entity that is, directly or indirectly, wholly-owned by the General
Partner and/or an SKB Controlled Entity, or (ii) the Transfer of such interest
is pursuant to or in connection with a Recapitalization and either (a) the
Recapitalization has been approved by the consent of a Majority-in-Interest of
the Limited Partners, or (b) an appropriate adjustment to the number of OP Units
held by each Partner has been made in accordance with Section 3.2(f).

      11.2  LIMITED PARTNER.

            (a)   No Limited Partner or substituted Limited Partner may Transfer
all or any part of its interest in the Partnership or any of such Limited
Partner's economic rights as a Limited Partner, unless each of the following
conditions are met:

                  (i)   The Limited Partner obtains the prior written consent of
the General Partner (which consent may be given or withheld in the sole
discretion of the General Partner), except for (x) the exchange of OP Units for
Common Shares, pursuant to Section 3.2(c) above or (y) the Transfer of Units by
any SKB Controlled Entity to any other SKB Controlled Entity;

                  (ii)  Either (x) the Partnership qualifies for the Private
Placement PTP Exemption for the entire taxable year of such Transfer and for all
prior taxable years, (y) the Transfer is a Private Transfer, or (z) the
Partnership is no longer potentially subject to classification as a publicly
traded partnership, as defined in Section 7704 of the Code, as determined by the
General Partner in its sole discretion;

                  (iii) Such Transfer is not limited or prohibited by, and
complies with, any restrictions on transferability contained in the Articles of
Incorporation and Bylaws of the General Partner and/or any applicable agreement
executed by the transferor;

                  (iv)  Such Transfer would not violate the securities laws of
any jurisdiction applicable to the Partnership or the Partnership Interest to be
assigned or transferred;

                  (v)   Such Transfer would not cause the Partnership to lose
its status as a partnership for U.S. federal income tax purposes or cause the
Partnership to become subject to the Investment Company Act;

                  (vi)  Such Transfer would not cause (A) all or any portion of
the assets of the Partnership (1) to constitute "plan assets" (under ERISA, the
Code or the applicable provisions of any similar law) of any existing or
contemplated investor, or (2) to be subject to the provisions of ERISA, the Code
or any applicable similar law, or (B) the General Partner to become a fiduciary
with respect to any existing or contemplated investor, pursuant to ERISA or the
applicable provisions of any similar law, or otherwise;

                                       33
<PAGE>

                  (vii) Such Transfer would not cause a termination of the
Partnership under Code Section 708;

                  (viii) The Transferor delivers opinions of counsel regarding
the foregoing matters in form and substance reasonably acceptable to the General
Partner as a condition to any such Transfer;

                  (ix)  The Transfer would not, in the opinion of the General
Partner, (y) by treating the interest in the Partnership so transferred as if it
had been exchanged for Common Shares in accordance with Section 3.2(c) above,
violate the limitations on ownership of Common Shares contained in the Articles
of Incorporation and/or Bylaws of the General Partner, or (z) violate any State
or Federal securities laws;

                  (x)   The Transferee shall have delivered a letter containing
the representation set forth in Section 16.12 and an executed power of attorney
containing the terms and provisions set forth in Article XIV hereof; and

                  (xi)  The Transferee shall have agreed to be bound by the
terms of this Agreement and shall have executed a counterpart hereof or joinder
hereto.

            (b) A Limited Partner shall notify the General Partner of any
Transfer of beneficial interest or other interest which occurs without a
transfer of record ownership, as well as any pledge or other collateral
transfer.

            (c)   No part of the interest of a Limited Partner shall be subject
to the claims of any creditor, any spouse for alimony or support, or to legal
process, and may not be voluntarily or involuntarily alienated or encumbered
except as may be specifically provided for in this Agreement. A Limited Partner
shall not be permitted to retire or withdraw from the Partnership except as
expressly permitted by this Agreement.

            (d)   Any Transferee of all or any portion of a Limited Partner's
interest in the Partnership in accordance and compliance with the provisions of
this Section 11.2 shall be entitled to receive Profits, Losses and distributions
hereunder attributable to such interest acquired by reason of such Transfer,
from and after the effective date of the Transfer of such interest; provided,
however, anything in this Agreement to the contrary notwithstanding, (i) without
the prior written consent of the General Partner, no Transferee shall be
considered a substituted Limited Partner; (ii) the Partnership and the General
Partner shall be entitled to treat the Transferor of such interest as the
absolute owner thereof in all respects, and shall incur no liability for the
allocation of Profits and Losses or distributions which are made to such
Transferor until such time as the written instrument of Transfer has been
received by the General Partner and the "effective date" of the Transfer has
passed, and (c) the General Partner shall have the right to require any such
Transferor to exchange such Partnership Interest for Common Shares or cash,
pursuant to Section 3.2(c) above. The "effective date" of any Transfer shall be
the last day of the month set forth on the written instrument of Transfer or
such other date consented to in writing by the General Partner as the "effective
date."

            (e)   Any Transfer in contravention of any of the provisions of this
Section 11.2 shall be void and ineffectual and shall not be binding upon, or
recognized by, the Partnership.

                                       34
<PAGE>

      11.3  ADMISSION ADJUSTMENTS. The General Partner shall, when necessary,
cause this Agreement to be amended from time to time (and shall cause Schedule A
to be revised), to reflect the admission or withdrawal of Partners, and the
issuance, conversion and redemption of any Preference Units and/or OP Units
(including the corresponding adjustment to Percentage Interests).

      11.4  TRANSFERS TO LENDERS. Notwithstanding any other provision of this
Agreement to the contrary, no transfer of any Units may be made to a lender to
the Partnership or any person who is related (within the meaning of Regulations
Section 1.752-4(b)) to any lender to the Partnership whose loan constitutes a
Nonrecourse Liability, without the consent of the General Partner, which consent
may be given or withheld by the General Partner in its sole and absolute
discretion. As a condition to any such consent being granted the lender will be
required to enter into an arrangement with the Partnership and the General
Partner to exchange or redeem for the Cash Amount or the REIT Shares Amount any
Units in which a security interest is held simultaneously with the time at which
such lender would be deemed to be a partner in the Partnership for purposes of
allocating liabilities to such lender under Code Section 752.

                                  ARTICLE XII

                            ADMISSION OF NEW PARTNERS

      The General Partner is authorized to admit to the Partnership as limited
partners those persons and entities who are not already Partners and who receive
OP Units and/or Preference Units in accordance with the provisions of this
Agreement.

                                  ARTICLE XIII

          TERM, TERMINATION, LIQUIDATION AND DISSOLUTION OF PARTNERSHIP

      13.1  TERM AND TERMINATION. The term of the Partnership shall commence on
the date hereof and continue until the Partnership is dissolved and its affairs
wound up in the manner hereinafter provided upon the earliest to occur of the
following events:

            (a)   the sale of all or substantially all of the assets of the
Partnership (provided that if the Partnership receives an installment obligation
as consideration for such sale or other disposition, the Partnership shall
continue, unless sooner dissolved under the provisions of this Agreement, until
such time as such note or notes are paid in full);

            (b)   subject to Section 13.4 below, the entry of a final judgment,
order or decree of a court of competent jurisdiction adjudicating as bankrupt
either the Partnership or the General Partner, and the expiration without appeal
of the period, if any, allowed by applicable law to appeal therefrom;

            (c)   The election by the General Partner that the Partnership
should be dissolved; or

            (d)   As otherwise provided in the Act.

                                       35
<PAGE>

      13.2  METHOD OF LIQUIDATION. Upon the happening of any of the events
specified in Section 13.1 above, the General Partner (or if there be no General
Partner, a liquidating trustee selected by a Majority-in-Interest of the Limited
Partners) shall immediately commence to wind up the Partnership's affairs and
shall liquidate the assets of the Partnership as promptly as possible, unless
the General Partner, or the liquidating trustee, shall determine that an
immediate sale of Partnership assets would cause undue loss to the Partnership,
in which event the liquidation may be deferred for a reasonable time. The
Partners shall continue to share distributions, Profits and Losses during the
period of liquidation in the same proportions as before dissolution (subject to
Section 13.2(c) below). The proceeds from liquidation of the Partnership,
including repayment of any debts of Partners to the Partnership, shall be
applied in the following order:

            (a)   Debts of the Partnership, including repayments of principal
and interest on loans and advances made by the General Partner pursuant to
Sections 3.3 and/or 8.7 above; then

            (b)   To the establishment of any reserves deemed necessary or
appropriate by the General Partner, or by the person(s) winding up the affairs
of the Partnership in the event there is no remaining General Partner of the
Partnership, for any contingent or unforeseen liabilities or obligations of the
Partnership. Such reserves established hereunder shall be held for the purpose
of paying any such contingent or unforeseen liabilities or obligations and, at
the expiration of such period as the General Partner, or such person(s) deems
advisable, the balance of such reserves shall be distributed in the manner
provided hereinafter in this Section 13.2 as though such reserves had been
distributed contemporaneously with the other funds distributed hereunder; and
then

            (c)   To the Partners in accordance with their respective positive
Capital Account balances, after giving effect to all contributions,
distributions and allocations for all periods. In connection therewith, income,
gain and loss of the Partnership (and to the extent necessary to achieve the
purposes hereof, items of gross income and deduction) with respect to the sale
or other disposition of all or substantially all of the Partnership's assets
and/or the Partnership's operations in connection therewith (whether or not
attributable to the taxable year in which the distribution pursuant to this
Section 13.2(c) is to be made or a preceding taxable year) shall be allocated
among the Partners so that each Partner's Capital Account shall equal, after
taking into account the prior balance (positive or negative) in such Partner's
Capital Account and the effect of such allocation, the amount that such Partner
would be entitled to receive if the Partnership were to make a distribution to
the Partners pursuant to the provisions of Section 7.2 hereof in an amount equal
to the remaining liquidation proceeds to be distributed under this Section
13.2(c).

      13.3  DATE OF TERMINATION. The Partnership shall be terminated when all
notes received in connection with any liquidating sales or other dispositions
have been paid or distributed and all of the cash or property available for
application and distribution under Section 13.2 above (including reserves) shall
have been applied and distributed in accordance therewith. The General Partner
or liquidating trustee shall amend or cancel the Certificate on termination of
the Partnership.

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<PAGE>

      13.4  RECONSTITUTION UPON BANKRUPTCY.

            (a)   Notwithstanding any dissolution of the Partnership under
Section 13.1(b) above, if the Partnership is reconstituted as set forth in this
Section 13.4, then the business of the Partnership shall be continued with the
Partnership's property and the Partnership's assets shall not be liquidated.

            (b)   If the Partnership is dissolved by reason of the bankruptcy,
withdrawal or removal of the General Partner, a successor general partner may,
in the discretion of the General Partner hereunder with the written consent of a
Majority-in-Interest of the Limited Partners, be admitted within 90 days after
the dissolution, effective as of the date of dissolution. Upon the admission of
such successor general partner, without any further consent or approval of any
other Partner, the Partnership shall be reconstituted as a successor limited
partnership.

            (c)   If the Partnership is dissolved by reason of the bankruptcy of
the Partnership in a proceeding for the reorganization (and not the liquidation)
of the Partnership, then, with the consent of the General Partner and a
Majority-in-Interest of the Limited Partners, the Partnership may be
reconstituted within 90 days after dissolution, effective as of the date of
dissolution, whereupon the Partnership shall be reconstituted as a successor
limited partnership.

            (d)   The successor limited partnership reconstituted in accordance
with the foregoing provisions of this Section 13.4 shall continue the business
of the Partnership with the Partnership's property. The Percentage Interests of
the Partners in the successor limited partnership shall be in proportion to
their respective Percentage Interests in the dissolved Partnership. Such
successor limited partnership shall be governed by the terms and provisions of
this Agreement and references in this Agreement to the Partnership or to the
Partners or their rights and obligations shall be understood to comprehend such
successor limited partnership and the Partners thereof and their rights and
obligations.

      13.5  DEATH, LEGAL INCOMPETENCY, ETC. OF A LIMITED PARTNER. The death,
legal incompetency, insolvency, dissolution or bankruptcy of a Limited Partner
shall not dissolve or terminate the Partnership. Upon the death or incapacity of
an individual Limited Partner, such individual Limited Partner's interest in the
Partnership shall be transferred either by will, the laws of intestacy or
otherwise to the legal representative or successor of such individual Limited
Partner.

                                  ARTICLE XIV

                               POWER OF ATTORNEY

      14.1  POWER OF ATTORNEY. Each Limited Partner hereby irrevocably
constitutes and appoints the General Partner, any Liquidator, and its authorized
officers and attorneys-in-fact, and each such Person acting singly, in each case
with full power of substitution, its true and lawful attorney-in-fact, for it
and in its name, place and stead and for its use and benefit, to sign, swear to,
acknowledge, deliver, file and record any certificate, instruments and documents
as may be deemed necessary or advisable by the General Partner or the Liquidator
to carry out fully

                                       37
<PAGE>

the provisions of this Agreement and the Act in accordance with its terms
including, without limitation:

            (a)   this Agreement, and subject to Article XV below, amendments to
this Agreement;

            (b)   any certificates, instruments and documents (including assumed
and fictitious name certificates) as may be required by, or may be appropriate
under, the laws of the State of Delaware or any other State or jurisdiction in
which the Partnership is doing or intends to do business, in order to discharge
the purposes of the Partnership or otherwise in connection with the use of the
name or names used by the Partnership;

            (c)   any other instrument which may be required to be filed or
recorded by the Partnership on behalf of the Partners under the laws of any
State or by any governmental agency in order for the Partnership to conduct its
business;

            (d)   any documents which may be required to effect the continuation
of the Partnership, the admission of a Substitute or Additional Partner, the
dissolution and termination of the Partnership or the amendment and restatement
of Schedule A, pursuant to the terms of this Agreement; and

            (e)   any documents which may be required or desirable to have the
General Partner appointed, and act as, the TMP.

      14.2  INTEREST. The foregoing grant of authority is a special power of
attorney coupled with an interest, is irrevocable and shall survive the death,
dissolution or incapacity of any individual Limited Partner, and shall survive
the delivery of any assignment by a Limited Partner of the whole or any portion
of his interest in the Partnership.

      14.3  WAIVER. Each such Limited Partner hereby agrees to be bound by any
representation made by the General Partner or any Liquidator, acting in good
faith pursuant to such power of attorney, and each such Limited Partner hereby
waives any and all defenses which may be available to contest, negate or
disaffirm the action of the General Partner or any Liquidator, taken in good
faith under such power of attorney.

      14.4  FURTHER ASSURANCES. Each Limited Partner shall execute and deliver
to the General Partner or the Liquidator, within fifteen (15) days after receipt
of the General Partner's or Liquidator's request therefor, such further
designation, powers of attorney and other instruments as the General Partner or
the Liquidator, as the case may be, deems necessary to effectuate this Agreement
and the purposes of the Partnership.

                                   ARTICLE XV

                             AMENDMENT OF AGREEMENT

      15.1  POWER. The General Partner shall have the power, without the consent
of the Limited Partners, to amend this Agreement except as set forth in Section
15.2 hereof. The General Partner shall provide notice to the Limited Partners
when any action under this Section 15.1

                                       38
<PAGE>

is taken in the next regular communication to the Limited Partners. The Limited
Partners shall not have the power to amend this Agreement.

      15.2  REQUIRED CONSENT. Notwithstanding Section 15.1 hereof, this
Agreement may only be amended with the written consent of:

            (a)   any Limited Partner adversely affected if such amendment would
      enlarge the obligation of any Partner to make contributions to the capital
      of the Partnership;

            (b)   those Limited Partners holding not less than 50% of the
      aggregate of Percentage Interests held by all Limited Partners if such
      amendment would modify the allocation of Profits or Losses or
      distributions among the Partners as provided for in Articles VI and VII
      above, respectively; or amend Articles I, XI or Section or 7.2; provided,
      however, that in no event shall the terms and conditions of a particular
      series of OP Units be changed without the written consent of the holders
      of at least 50% of the Units within the class or series;

            (c)   all Partners if such amendment would amend this Article XV.

      15.3  REIT STATUS. Notwithstanding anything to the contrary in this
Article XV, the General Partner shall have the power, without consent of the
Limited Partners, to amend this Agreement as may be required to reflect such
changes as are reasonably necessary for the General Partner to maintain its
status as a REIT, including changes which may be necessitated due to a change in
applicable law (or an authoritative interpretation thereof) or a ruling of the
IRS.

                                  ARTICLE XVI

                                 MISCELLANEOUS

      16.1  NOTICES. Any notice, election or other communication provided for or
required by this Agreement shall be in writing and shall be deemed to have been
given when delivered by hand or by facsimile transmission (with written
confirmation of receipt), the first business day after sent by overnight courier
(such as Federal Express), or on the second business day after deposit in the
United States Mail, certified or registered, return receipt requested, postage
prepaid, properly addressed to the Partner to whom such notice is intended to be
given at the address for the Partner set forth on Schedule A of this Agreement,
or at such other address as such person may have previously furnished in writing
to the Partnership and each Partner with copies to the General Partner at 1211
SW Fifth Avenue, Suite 2250, Portland, Oregon 97204.

      16.2  SUCCESSORS AND ASSIGNS. Any person acquiring or claiming an interest
in the Partnership, in any manner whatsoever, shall be subject to and bound by
all of the terms, conditions and obligations of this Agreement to which his
predecessor-in-interest was subject or bound, without regard to whether such a
person has executed a counterpart hereof or any other document contemplated
hereby. No person, including the legal representative, heir or legatee of a
deceased Partner, shall have any rights or obligations greater than those set
forth in this Agreement, and no person shall acquire an interest in the
Partnership or become a Partner thereof except as expressly permitted by and
pursuant to the terms of this Agreement. Subject to the

                                       39
<PAGE>

foregoing, and the provisions of Article XI above, this Agreement shall be
binding upon and inure to the benefit of the Partnership, the Partners and their
respective successors, assigns, heirs, legal representatives, executors and
administrators.

      16.3  COUNTERPARTS. For the convenience of the Partners, any number of
counterparts hereof may be executed, and each such counterpart shall be deemed
to be an original instrument, and all of which taken together shall constitute
one agreement.

      16.4  CONSTRUCTION. The titles of the Articles, Sections and subsections
herein have been inserted as a matter of convenience of reference only and shall
not control or affect the meaning or construction of any terms or provisions
herein.

      16.5  GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware. Except to the extent the Act
is inconsistent with the provisions of this Agreement, the provisions of such
Act shall apply to the Partnership.

      16.6  OTHER INSTRUMENTS. The parties hereto covenant and agree that they
will perform all further acts and execute such other and further instruments and
documents as, in opinion of the General Partner, are or may become necessary or
desirable to effectuate and carry out the provisions of this Agreement or the
Act.

      16.7  GENERAL PARTNER WITH INTEREST AS LIMITED PARTNER. If the General
Partner ever has an interest as a Limited Partner in the Partnership, the
General Partner shall, with respect to such interest, enjoy all of the rights
and be subject to all of the obligations and duties of a Limited Partner.

      16.8  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 hereof and this Agreement shall be
construed as if such invalid, illegal or unenforceable provision had never been
contained herein

      16.9  GENDER AND PLURALS. Whenever the context shall so require, all words
herein in any gender shall be deemed to include the masculine, feminine or
neuter gender, all singular words shall include the plural, and all plural words
shall include the singular.

      16.10 ENTIRE AGREEMENT. This Agreement and the Schedule attached hereto
supersede any prior understandings or written or oral agreements among the
Partners, or any of them, respecting the subject matter hereof and constitute
the entire understanding amongst the Partners with respect thereto.

      16.11 NO THIRD PARTY BENEFICIARY. The terms and provisions of this
Agreement are for the exclusive use and benefit of General Partner and the
Limited Partners and shall not inure to the benefit of any other person or
entity. No creditor or other third party having dealings with the Partnership
shall have the right to enforce the right or obligation of any Partner to make
Capital Contributions or loans or to pursue any other right or remedy hereunder
or at law or in equity, it being understood and agreed that the provisions of
this Agreement shall be solely for the benefit of, and may be enforced solely
by, the parties hereto and their respective successors

                                       40
<PAGE>

and assigns. None of the rights or obligations of the Partners herein set forth
to make Capital Contributions or loans to the Partnership shall be deemed an
asset of the Partnership for any purpose by any creditor or other third party,
nor may such rights or obligations be sold, transferred, or assigned by the
Partnership or pledged or encumbered by the Partnership to secure any debt or
other obligation of the Partnership or of any of the Partners. In addition, it
is the intent of the parties hereto that no distribution to any Limited Partner
shall be deemed a return of money or other property in violation of the Act.
However, if any court of competent jurisdiction holds that, not withstanding the
provisions of this Agreement, any Limited Partner is obligated to return such
money or property, such obligation shall be the obligation of such Limited
Partner and not of the General Partner. Without limiting the generality of the
foregoing, a deficit Capital Account of a Partner shall not be deemed to be a
liability of such Partner nor an asset or property of the Partnership.

      16.12 PURCHASE FOR INVESTMENT. Each Partner represents, warrants and
agrees that it has acquired and will hold its interest in the Partnership for
its own account for investment only and not for the purpose of, or with a view
toward, the resale or distribution of all or any part thereof, nor with a view
toward selling or otherwise distributing such interest or any part thereof at
any particular time or under any predetermined circumstances. Each Partner
further represents and warrants that it is a sophisticated investor, able and
accustomed to handling sophisticated financial matters for itself, particularly
real estate investments, and that it has a sufficiently high net worth that it
does not anticipate a need for the funds it has invested in the Partnership in
what it understands to be a highly speculative and illiquid investment.

      16.13 WAIVER. No consent or waiver, express or implied, by any Partner to
or of any breach or default by any other Partner in the performance by such
other Partner of its obligations hereunder shall be deemed or construed to be a
consent to or waiver of any other breach or default in the performance by such
other Partner of the same or any other obligations of such Partner hereunder.
Failure on the part of any Partner to complain of any act or failure to act on
the part of any other Partner or to declare any other Partner in default,
irrespective of how long such failure continues, shall not constitute a waiver
by such Partner of its rights hereunder.

                  [Remainder of Page Intentionally Left Blank]

                                       41
<PAGE>

      IN WITNESS WHEREOF, this Agreement has been executed and sworn to as of
the day and year first above written by the General Partner and the undersigned
Limited Partners.

GENERAL PARTNER:

SKB REIT, Inc.,
a Maryland corporation

By:___________________________________

Name:_________________________________

Title:________________________________

LIMITED PARTNER:

SKB Advisors LLC,
a Delaware Limited Liability Corporation

By:___________________________________

Name:_________________________________

Title:________________________________

                                       42
<PAGE>

                                   SCHEDULE A

              Partners, Capital Accounts and Partnership Interests

                                     A - 1exv10w1

 

Exhibit 10.1

EXECUTION COUNTERPART

$2,400,000,000

REVOLVING CREDIT AGREEMENT

dated as of October 15, 2004

by and among

WASTE MANAGEMENT, INC.

(the “Borrower”)

and

WASTE MANAGEMENT HOLDINGS, INC.

(the “Guarantor”)

and

Certain Banks

and

CITIBANK, N.A.,

as Administrative Agent

and

JPMORGAN CHASE BANK and FLEET NATIONAL BANK,

as Syndication Agents

BARCLAYS BANK PLC and DEUTSCHE BANK SECURITIES INC.,

as Documentation Agents

J.P. MORGAN SECURITIES INC. and BANC OF AMERICA SECURITIES LLC

as Lead Arrangers and Book Managers

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	§1. DEFINITIONS AND RULES OF INTERPRETATION
	 	 	1	 
	§1.1. Definitions
	 	 	1	 
	§1.2. Rules of Interpretation
	 	 	18	 
	§1.3. Classification of Loans and Borrowings
	 	 	19	 
	§2. THE LOAN FACILITIES
	 	 	19	 
	§2.1. Commitment to Lend
	 	 	19	 
	§2.2. Facility Fee
	 	 	19	 
	§2.3. Reduction and Increase of Total Commitment
	 	 	19	 
	§2.3.1. Reduction of Total Commitment
	 	 	19	 
	§2.3.2. Increase of Total Commitment
	 	 	20	 
	§2.4. Repayment of Loans; Evidence of Debt
	 	 	20	 
	§2.5. Interest on Loans
	 	 	21	 
	§2.6. Requests for Syndicated Loans
	 	 	21	 
	§2.7. Election of Eurodollar Rate; Notice of Election; Interest Periods;
Minimum Amounts
	 	 	22	 
	§2.8. Funds for Syndicated Loans
	 	 	23	 
	§2.9. Maturity of the Loans and Reimbursement Obligations
	 	 	24	 
	§2.10. Optional Prepayments or Repayments of Loans
	 	 	24	 
	§2.11. Swing Line Loans; Settlements
	 	 	24	 
	§3. LETTERS OF CREDIT
	 	 	26	 
	§3.1. Letter of Credit Commitments
	 	 	26	 
	§3.2. Reimbursement Obligation of the Borrower
	 	 	28	 
	§3.3. Obligations Absolute
	 	 	28	 
	§3.4. Reliance by the Issuing Banks
	 	 	29	 
	§3.5. Notice Regarding Letters of Credit
	 	 	29	 
	§3.6. Letter of Credit Fee; Issuance Fee
	 	 	29	 
	§4. COMPETITIVE BID LOANS
	 	 	29	 
	§4.1. The Competitive Bid Option
	 	 	29	 
	§4.2. Competitive Bid Loan Accounts; Competitive Bid Loans
	 	 	29	 
	§4.3. Competitive Bid Quote Request; Invitation for Competitive Bid Quotes
	 	 	30	 
	§4.4. Alternative Manner of Procedure
	 	 	31	 
	§4.5. Submission and Contents of Competitive Bid Quotes
	 	 	31	 
	§4.6. Notice to Borrower
	 	 	32	 
	§4.7. Acceptance and Notice by Borrower and Administrative Agent
	 	 	33	 
	§4.8. Allocation by Administrative Agent
	 	 	33	 
	§4.9. Funding of Competitive Bid Loans
	 	 	33	 
	§4.10. Funding Losses
	 	 	34	 
	§4.11. Repayment of Competitive Bid Loans; Interest
	 	 	34	 
	§5. PROVISIONS RELATING TO ALL LOANS AND LETTERS OF CREDIT
	 	 	34	 
	§5.1. Payments
	 	 	34	 
	§5.2. Mandatory Repayments of the Loans
	 	 	36	 
	§5.3. Computations
	 	 	36	 
	§5.4. Illegality; Inability to Determine Eurodollar Rate
	 	 	37	 
	§5.5. Additional Costs, Etc
	 	 	37	 

- i -

 

	 	 	 	 	 
	§5.6. Capital Adequacy
	 	 	38	 
	§5.7. Certificate
	 	 	39	 
	§5.8. Eurodollar and Competitive Bid Indemnity
	 	 	39	 
	§5.9. Interest on Overdue Amounts
	 	 	39	 
	§5.10. Interest Limitation
	 	 	40	 
	§5.11. Reasonable Efforts to Mitigate
	 	 	40	 
	§5.12. Replacement of Banks
	 	 	40	 
	§5.13. Advances by Administrative Agent
	 	 	41	 
	§6. REPRESENTATIONS AND WARRANTIES
	 	 	41	 
	§6.1. Corporate Authority
	 	 	41	 
	§6.2. Governmental and Other Approvals
	 	 	42	 
	§6.3. Title to Properties; Leases
	 	 	42	 
	§6.4. Financial Statements; Solvency
	 	 	42	 
	§6.5. No Material Changes, Etc
	 	 	43	 
	§6.6. Franchises, Patents, Copyrights, Etc
	 	 	43	 
	§6.7. Litigation
	 	 	43	 
	§6.8. No Materially Adverse Contracts, Etc
	 	 	43	 
	§6.9. Compliance With Other Instruments, Laws, Etc
	 	 	43	 
	§6.10. Tax Status
	 	 	44	 
	§6.11. No Event of Default
	 	 	44	 
	§6.12. Holding Company and Investment Company Acts
	 	 	44	 
	§6.13. Absence of Financing Statements, Etc
	 	 	44	 
	§6.14. Employee Benefit Plans
	 	 	44	 
	§6.14.1. In General
	 	 	44	 
	§6.14.2. Terminability of Welfare Plans
	 	 	45	 
	§6.14.3. Guaranteed Pension Plans
	 	 	45	 
	§6.14.4. Multiemployer Plans
	 	 	45	 
	§6.15. Environmental Compliance
	 	 	45	 
	§6.16. Disclosure
	 	 	47	 
	§6.17. Permits and Governmental Authority
	 	 	47	 
	§7. AFFIRMATIVE COVENANTS OF THE BORROWER
	 	 	47	 
	§7.1. Punctual Payment
	 	 	47	 
	§7.2. Maintenance of U.S. Office
	 	 	47	 
	§7.3. Records and Accounts
	 	 	47	 
	§7.4. Financial Statements, Certificates and Information
	 	 	47	 
	§7.5. Existence and Conduct of Business
	 	 	49	 
	§7.6. Maintenance of Properties
	 	 	49	 
	§7.7. Insurance
	 	 	49	 
	§7.8. Taxes
	 	 	50	 
	§7.9. Inspection of Properties, Books and Contracts
	 	 	50	 
	§7.10. Compliance with Laws, Contracts, Licenses and Permits;
Maintenance of Material Licenses and Permits
	 	 	50	 
	§7.11. Environmental Indemnification
	 	 	50	 
	§7.12. Further Assurances
	 	 	51	 
	§7.13. Notice of Potential Claims or Litigation
	 	 	51	 
	§7.14. Notice of Certain Events Concerning Environmental Claims
	 	 	51	 

- ii -

 

	 	 	 	 	 
	§7.15. Notice of Default
	 	 	52	 
	§7.16. Use of Proceeds
	 	 	52	 
	§7.17. Certain Transactions
	 	 	52	 
	§8. NEGATIVE COVENANTS OF THE BORROWER
	 	 	52	 
	§8.1. Restrictions on Indebtedness
	 	 	53	 
	§8.2. Restrictions on Liens
	 	 	53	 
	§8.3. Restrictions on Investments
	 	 	54	 
	§8.4. Mergers, Consolidations, Sales
	 	 	54	 
	§8.5. Restricted Distributions and Redemptions
	 	 	55	 
	§8.6. Employee Benefit Plans
	 	 	55	 
	§9. FINANCIAL COVENANTS OF THE BORROWER
	 	 	56	 
	§9.1. Interest Coverage Ratio
	 	 	56	 
	§9.2. Total Debt to EBITDA
	 	 	56	 
	§10. CONDITIONS PRECEDENT
	 	 	56	 
	§10.1. Conditions To Effectiveness
	 	 	56	 
	§10.1.1. Corporate Action
	 	 	56	 
	§10.1.2. Loan Documents, Etc
	 	 	56	 
	§10.1.3. Certified Copies of Charter Documents
	 	 	56	 
	§10.1.4. Incumbency Certificate
	 	 	56	 
	§10.1.5. Certificates of Insurance
	 	 	57	 
	§10.1.6. Opinion of Counsel
	 	 	57	 
	§10.1.7. Satisfactory Financial Condition
	 	 	57	 
	§10.1.8. Payment of Closing Fees
	 	 	57	 
	§10.1.9. Termination of Existing Credit Agreements
	 	 	57	 
	§10.1.10. Closing Certificate
	 	 	57	 
	§11. CONDITIONS TO ALL LOANS
	 	 	57	 
	§11.1. Representations True
	 	 	57	 
	§11.2. Performance; No Event of Default
	 	 	58	 
	§11.3. Proceedings and Documents
	 	 	58	 
	§12. EVENTS OF DEFAULT; ACCELERATION; TERMINATION OF COMMITMENT
	 	 	58	 
	§12.1. Events of Default and Acceleration
	 	 	58	 
	§12.2. Termination of Commitments
	 	 	61	 
	§12.3. Remedies
	 	 	61	 
	§13. SETOFF
	 	 	61	 
	§14. EXPENSES
	 	 	61	 
	§15. THE AGENTS
	 	 	62	 
	§15.1. Authorization and Action
	 	 	62	 
	§15.2. Administrative Agent’s Reliance, Etc
	 	 	62	 
	§15.3. Citibank and Affiliates
	 	 	63	 
	§15.4. Bank Credit Decision
	 	 	63	 
	§15.5. Indemnification
	 	 	63	 
	§15.6. Successor Administrative Agent
	 	 	63	 
	§15.7. Lead Arrangers, Etc
	 	 	64	 
	§15.8. Documents
	 	 	64	 
	§15.9. Action by the Banks, Consents, Amendments, Waivers, Etc
	 	 	64	 
	§16. INDEMNIFICATION
	 	 	65	 

- iii -

 

	 	 	 	 	 
	§17. WITHHOLDING TAXES
	 	 	65	 
	§18. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION
	 	 	67	 
	§18.1. Confidentiality
	 	 	67	 
	§18.2. Prior Notification
	 	 	68	 
	§18.3. Other
	 	 	68	 
	§19. SURVIVAL OF COVENANTS, ETC
	 	 	68	 
	§20. ASSIGNMENT AND PARTICIPATION
	 	 	68	 
	§21. PARTIES IN INTEREST
	 	 	70	 
	§22. NOTICES, ETC
	 	 	70	 
	§23. MISCELLANEOUS
	 	 	71	 
	§24. CONSENTS, ETC
	 	 	72	 
	§25. WAIVER OF JURY TRIAL
	 	 	72	 
	§26. GOVERNING LAW; SUBMISSION TO JURISDICTION
	 	 	73	 
	§27. SEVERABILITY
	 	 	73	 
	§28. GUARANTY
	 	 	73	 
	§28.1. Guaranty
	 	 	73	 
	§28.2. Guaranty Absolute
	 	 	73	 
	§28.3. Effectiveness; Enforcement
	 	 	74	 
	§28.4. Waiver
	 	 	74	 
	§28.5. Expenses
	 	 	75	 
	§28.6. Concerning Joint and Several Liability of the Guarantor
	 	 	75	 
	§28.7. Waiver
	 	 	77	 
	§28.8. Subrogation; Subordination
	 	 	77	 
	§29. PARI PASSU TREATMENT
	 	 	77	 
	§30. FINAL AGREEMENT
	 	 	78	 
	§31. USA PATRIOT Act
	 	 	78	 

Exhibits

	 	 	 
	Exhibit A

	 	Form of Syndicated Loan Request
	 
	 	 
	Exhibit B

	 	Form of Letter of Credit Request
	 
	 	 
	Exhibit C

	 	Form of Compliance Certificate
	 
	 	 
	Exhibit D

	 	Form of Assignment and Acceptance
	 
	 	 
	Exhibit E

	 	Form of Competitive Bid Quote Request
	 
	 	 
	Exhibit F

	 	Form of Invitation for Competitive Bid Quotes
	 
	 	 
	Exhibit G

	 	Form of Competitive Bid Quote
	 
	 	 
	Exhibit H

	 	Form of Notice of Acceptance/Rejection of
  Competitive
Bid Quote(s)

- iv -

 

Schedules

	 	 	 
	Schedule 1

	 	Banks; Commitments
	 
	 	 
	Schedule 1.1

	 	Existing Liens
	 
	 	 
	Schedule 3.1

	 	Issuing Bank Limits
	 
	 	 
	Schedule 3.1.1

	 	Form of Increase/Decrease Letter
	 
	 	 
	Schedule 3.1.2

	 	Existing Letters of Credit
	 
	 	 
	Schedule 6.7

	 	Litigation
	 
	 	 
	Schedule 6.15

	 	Environmental Compliance
	 
	 	 
	Schedule 8.1(a)

	 	Existing Indebtedness

- v -

 

REVOLVING CREDIT AGREEMENT

     This REVOLVING CREDIT AGREEMENT is made as of the 15th day of October,
2004, by and among WASTE MANAGEMENT, INC., a Delaware corporation having its
chief executive office at 1001 Fannin Street, Suite 4000, Houston, Texas 77002
(the “Borrower”), WASTE MANAGEMENT HOLDINGS, INC., a wholly-owned Subsidiary of
the Borrower (the “Guarantor”), certain financial institutions (the “Banks”)
and CITIBANK, N.A., as Administrative Agent (in such capacity, the
“Administrative Agent”).

     WHEREAS, the Borrower has requested certain financing arrangements and the
Banks have agreed to provide such financing arrangements on the terms set forth
herein;

     NOW, THEREFORE, in consideration of the foregoing, the mutual covenants
and agreements set forth herein below, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged by
the parties, this Agreement will take effect on the Effective Date, on the
following terms:

§1. DEFINITIONS AND RULES OF INTERPRETATION.

          §1.1. Definitions. The following terms shall have the meanings set forth in
this §1 or elsewhere in the provisions of this Agreement referred to below:

     Absolute Competitive Bid Loan(s). Competitive Bid Loans bearing interest
at a fixed rate per annum in accordance with §4.5(b)(v).

     Accountants. See §7.4(a).

     Administrative Agent. See Preamble.

     Administrative Agent’s Account. The account of the Administrative Agent
maintained by the Administrative Agent at Citibank at Two Penns Way, Suite 200,
New Castle, Delaware 19720, ABA# 021000089, Account No. 36852248, Account Name:
NAIB Agency Medium Term Finance/Reference: Waste Management, Attention: Tara
Wooster, or such other account as may from time to time be designated by the
Administrative Agent to the Borrower and the Banks in writing.

     Affected Bank. See §5.12.

     Agreement. This Revolving Credit Agreement, including the Schedules and
Exhibits hereto, as from time to time amended and supplemented in accordance
with the terms hereof.

     Applicable Base Rate. The applicable rate per annum of interest on the
Base Rate Loans as set forth in the Pricing Table.

     Applicable Eurodollar Rate. The applicable rate per annum of interest on
the Eurodollar Loans shall be as set forth in the Pricing Table.

 

 

     Applicable Facility Fee Rate. The applicable rate per annum with respect
to the Facility Fee shall be as set forth in the Pricing Table.

     Applicable L/C Rate. The applicable rate per annum on the Maximum Drawing
Amount shall be as set forth in the Pricing Table.

     Applicable Requirements. See §7.10.

     Applicable Spot Rate. On any date, the quoted spot rate for conversion of
Canadian Dollars to U.S. Dollars as published on Reuters page 1FED at
approximately 10:00 a.m. New York time on such date, and as determined as
provided in the definition of “U.S. Dollar Equivalent” herein.

     Applicable Swing Line Rate. The annual rate of interest agreed upon from
time to time by the Administrative Agent and the Borrower with respect to Swing
Line Loans.

     Approved Fund. Any Person (other than a natural person) that is engaged
in making, purchasing, holding or investing in bank loans and similar
extensions of credit in the ordinary course of its business and that is
administered or managed by (a) a Bank or (b) a Bank Affiliate.

     Assignment and Acceptance. See §20.

     Balance Sheet Date. December 31, 2003.

     Bank Affiliate. (a) With respect to any Bank, (i) a Person that directly,
or indirectly through one or more intermediaries, possesses, directly or
indirectly, the power to direct or cause the direction of the management or
policies of such Bank, whether through the ability to exercise voting power, by
contract or otherwise or is controlled by or is under common control with such
Bank (an “Affiliate”) or (ii) any entity (whether a corporation, partnership,
trust or otherwise) that is engaged in making, purchasing, holding or otherwise
investing in bank loans and similar extensions of credit in the ordinary course
of its business and is administered or managed by a Bank or an Affiliate of
such Bank and (b) with respect to any Bank that is a fund which invests in bank
loans and similar extensions of credit, any other fund that invests in bank
loans and similar extensions of credit and is managed by the same investment
advisor as such Bank or by an Affiliate of such investment advisor.

     Banks. See Preamble.

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

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

     (b) 0.50% per annum above the Federal Funds Rate in effect from time
to time.

- 2 -

 

Each change in any interest rate provided for herein based upon the Base Rate
resulting from a change in the Base Rate shall take effect at the time of such
change in the Base Rate.

     Base Rate Loans. Syndicated Loans bearing interest calculated by
reference to the Base Rate.

     Borrower. See Preamble.

     Borrowing. (a) Syndicated Loans of the same Type, made, converted or
continued on the same date and, in the case of Eurodollar Loans, as to which a
single Interest Period is in effect, (b) a Competitive Bid Loan or group of
Competitive Bids Loans of the same Type made on the same date and as to which a
single Interest Period is in effect or (c) Swing Line Loans.

     Business Day. Any day, other than a Saturday, Sunday or any day on which
banking institutions in New York, New York are authorized by law to close, and,
when used in connection with a Eurodollar Loan, a Eurodollar Business Day.

     Canadian Dollars or C$. The lawful currency of Canada.

     Canadian Dollar Letter of Credit. See §3.1(e).

     Canadian Subsidiary. A Subsidiary that is organized under the laws of
Canada or any province thereof.

     Capitalized Leases or Capital Leases. Leases under which a Person is the
lessee or obligor and the discounted future rental payment obligations under
which are required to be capitalized on the consolidated balance sheet of the
lessee or obligor in accordance with GAAP.

     Cash Equivalents. Investments in (i) direct obligations of, or
unconditionally guaranteed 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 less than
one year, (ii) U.S. Dollar-denominated time deposits, certificates of deposit
and banker’s acceptances of any Bank or any other bank whose short-term
commercial paper rating from Standard & Poor’s is at least A-1 or from Moody’s
is at least P-1 (each an “Approved Bank”) with maturities of not more than one
year from the date of investment, (iii) commercial paper issued by, or
guaranteed by, an Approved Bank or by the parent company of an Approved Bank,
or issued by, or guaranteed by, any company with a long-term senior unsecured
debt rating of at least A+ by Standard & Poor’s and A1 by Moody’s, in each case
maturing within one year from the date of investment, (iv) repurchase
agreements with a term of less than one year for underlying securities of the
types described in clauses (ii) and (iii) entered into with an Approved Bank,
(v) auction rate securities with an auction frequency of not more than 35 days,
carrying a credit rating of at least AA by Standard & Poor’s or at least Aa
from Moody’s; (vi) variable rate demand notes with a put option no longer than
seven days from date of purchase to the extent backed by letters of
credit issued by banks having a credit rating of at least A1 from Moody’s
or P1 from

- 3 -

 

Standard & Poor’s; and (vii) any fund or funds making substantially
all of their Investments in Investments of the kinds described in clauses (i)
through (vi) above.

     CERCLA. See §6.15(a).

     Certified or certified. With respect to the financial statements of any
Person, such statements as audited by a firm of independent auditors, whose
report expresses the opinion, without qualification, that such financial
statements present fairly, in all material respects, the financial position of
such Person.

     CFO or CAO. See §7.4(b).

     Citibank. Citibank, N.A.

     Class. When used in reference to any Loan or Borrowing, refers to whether
such Loan, or the Loans comprising such Borrowing, are Syndicated Loans,
Competitive Bid Loans or Swing Line Loans.

     Code. The Internal Revenue Code of 1986, as amended and in effect from
time to time.

     Commitment. With respect to each Bank, such Bank’s commitment to make
Syndicated Loans to, and to participate in the issuance, extension and renewal
of Letters of Credit for the account of, the Borrower, determined by
multiplying such Bank’s Commitment Percentage by the Total Commitment.

     Commitment Percentage. With respect to each Bank, the percentage
initially set forth next to such Bank’s name on Schedule 1 hereto, as the same
may be adjusted in accordance with §20.

     Competitive Bid Loan(s). A Borrowing hereunder consisting of one or more
loans made by any of the participating Banks whose offer to make a Competitive
Bid Loan as part of such Borrowing has been accepted by the Borrower under the
auction bidding procedure described in §4 hereof.

     Competitive Bid Loan Accounts. See §4.2(a).

     Competitive Bid Margin. See §4.5(b)(iv).

     Competitive Bid Quote. An offer by a Bank to make a Competitive Bid Loan
in accordance with §4.5 hereof.

     Competitive Bid Quote Request. See §4.3.

     Competitive Bid Rate. See §4.5(b)(v).

     Compliance Certificate. See §7.4(c).

- 4 -

 

     Consolidated or consolidated. With reference to any term defined herein,
shall mean that term as applied to the accounts of the Borrower, its
Subsidiaries and all variable interest entities consolidated in accordance with
GAAP.

     Consolidated Earnings Before Interest and Taxes or EBIT. For any period,
the Consolidated Net Income (or Deficit) of the Borrower on a consolidated
basis plus, without duplication, the sum of (1) interest expense, (2) equity in
losses (earnings) of unconsolidated entities, (3) income taxes, (4) non-cash
writedowns or write-offs of assets, including non-cash losses on the sale of
assets outside the ordinary course of business, (5) non-recurring charges for
settlement or judgment costs with respect to the shareholder lawsuits and
actions brought against the Borrower or the Guarantor related to, arising or
resulting from, the restatements of financial statements or results, lowered
expected earnings announcements occurring in 1998 and 1999, alleged
misrepresentations, misstatements or omissions contained in, or the adequacy
of, any disclosure documents filed with the Securities and Exchange Commission
in 1998 and 1999, as further described in the Disclosure Documents
(collectively, the “Shareholder Suits”), and (6) EBIT of the businesses
acquired by the Borrower or any of its Subsidiaries (through asset purchases or
otherwise) (each an “Acquired Business”) or the Subsidiaries acquired or formed
since the beginning of such period (each a “New Subsidiary”) provided, that a
statement identifying all such Acquired Businesses and the EBIT of such
Acquired Businesses is delivered to the Banks with the Compliance Certificate
for such period, all to the extent that each of items (1) through (5) was
deducted in determining Consolidated Net Income (or Deficit) in the relevant
period, minus non-cash extraordinary gains on the sale of assets outside the
ordinary course of business to the extent included in Consolidated Net Income
(or Deficit).

     Consolidated Earnings Before Interest, Taxes, Depreciation and
Amortization or EBITDA. For any period, EBIT plus (a) depreciation expense,
and (b) amortization expense to the extent the same would be included in the
calculation of Consolidated Net Income (or Deficit) for such period, determined
in accordance with GAAP.

     Consolidated Net Income (or Deficit). The consolidated net income (or
deficit) of the Borrower, after deduction of all expenses, taxes, and other
proper charges, determined in accordance with GAAP.

     Consolidated Tangible Assets. Consolidated Total Assets less the sum of:

     (a) the total book value of all assets of the Borrower on a
consolidated basis properly classified as intangible assets under GAAP,
including such items as goodwill, the purchase price of acquired assets in
excess of the fair market value thereof, trademarks, trade names, service
marks, customer lists, brand names, copyrights, patents and licenses, and
rights with respect to the foregoing; plus

     (b) all amounts representing any write-up in the book value of any
assets of the Borrower on a consolidated basis resulting from a
revaluation thereof subsequent to the Balance Sheet Date.

- 5 -

 

     Consolidated Total Assets. All assets of the Borrower determined on a
consolidated basis in accordance with GAAP.

     Consolidated Total Interest Expense. For any period, the aggregate amount
of interest expense required by GAAP to be paid or (without duplication)
accrued during such period on all Indebtedness of the Borrower on a
consolidated basis outstanding during all or any part of such period, including
capitalized interest expense for such period.

     Defaulting Bank. See §5.12.

     Defaults. See §12.1.

     Disclosure Documents. The Borrower’s financial statements referred to in
§6.4 and filings made by the Borrower or the Guarantor with the Securities and
Exchange Commission that were publicly available prior to the Effective Date
which were provided to the Banks.

     Disposal or Disposed. See “Release”.

     Distribution. The declaration or payment of any dividend or other return
on equity on or in respect of any shares of any class of capital stock, any
partnership interests or any membership interests of any Person (other than
dividends or other such returns payable solely in shares of capital stock,
partnership interests or membership units of such Person, as the case may be);
the purchase, redemption, or other retirement of any shares of any class of
capital stock, partnership interests or membership units of such Person,
directly or indirectly through a Subsidiary or otherwise; the return of equity
capital by any Person to its shareholders, partners or members as such; or any
other distribution on or in respect of any shares of any class of capital
stock, partnership interest or membership unit of such Person.

     Dollars or US$ or $ or U.S. Dollars. The lawful currency of the United
States of America.

     Drawdown Date. The date on which any Loan is made or is to be made, or
any amount is paid by an Issuing Bank under a Letter of Credit.

     EBIT. See definition of Consolidated Earnings Before Interest and Taxes.

     EBITDA. See definition of Consolidated Earnings Before Interest, Taxes,
Depreciation and Amortization.

     Effective Date. The date on which the conditions precedent set forth in
§10.1 hereof are satisfied.

     Employee Benefit Plan. Any employee benefit plan within the meaning of
§3(3) of ERISA maintained or contributed to by the Borrower, any of its
Subsidiaries, or any ERISA Affiliate, other than a Multiemployer Plan.

     Environmental Laws. See §6.15(a).

- 6 -

 

     EPA. See §6.15(b).

     ERISA. The Employee Retirement Income Security Act of 1974, as amended
and in effect from time to time.

     ERISA Affiliate. Any Person which is treated as a single employer with
the Borrower or any of its Subsidiaries under §414 of the Code.

     ERISA Reportable Event. A reportable event within the meaning of §4043 of
ERISA and the regulations promulgated thereunder with respect to a Guaranteed
Pension Plan as to which the requirement of notice has not been waived.

     Eurocurrency Reserve Rate. For any day with respect to a Eurodollar Loan,
the maximum rate (expressed as a decimal) at which the bank acting as
Administrative Agent would be required to maintain reserves under Regulation D
of the Board of Governors of the Federal Reserve System (or any successor or
similar regulations relating to such reserve requirements) against
“Eurocurrency Liabilities” (as that term is used in Regulation D), if such
liabilities were outstanding. The Eurocurrency Reserve Rate shall be adjusted
automatically on and as of the effective date of any change in the Eurocurrency
Reserve Rate.

     Eurodollar Business Day. Any day on which commercial banks are open for
international business (including dealings in Dollar deposits) in London or
such other eurodollar interbank market as may be selected by the Administrative
Agent in its sole discretion acting in good faith.

     Eurodollar Competitive Bid Loans. Competitive Bid Loans bearing interest
calculated by reference to the Eurodollar Rate in accordance with §4.5(b)(iv).

     Eurodollar Lending Office. Initially, the office of each Bank set forth
in the administrative materials provided to the Administrative Agent;
thereafter, upon notice to the Administrative Agent, such other office of such
Bank that shall be making or maintaining Eurodollar Loans.

     Eurodollar Loans. Syndicated Loans bearing interest calculated by
reference to the Eurodollar Rate.

     Eurodollar Rate. For any Interest Period with respect to a Eurodollar
Loan, (i)(a) the rate of interest equal to the rate determined by the
Administrative Agent at which Dollar deposits for such Interest Period are
offered based on information presented on Page 3750 of the Dow Jones Market
Service (or on any successor or substitute page of such service, or any
successor to or substitute for such service, providing rate quotations
comparable to those currently provided on such page of such service, as
determined by the Administrative Agent from time to time) as of 11:00 a.m.
(London time) two (2) Eurodollar Business Days prior to the first day of such
Interest Period, or (b) if such rate is not shown at such place, the rate of
interest equal to (i) the rate per annum at which the Administrative Agent’s
Eurodollar Lending Office is offered Dollar deposits at approximately 10:00
a.m. (New York time) two (2) Eurodollar Business Days prior to the beginning of
such Interest Period in the interbank

- 7 -

 

eurodollar market where the eurodollar operations of such Eurodollar
Lending Office are customarily conducted, for delivery on the first day of such
Interest Period for the number of days comprised therein and in an amount
comparable to the amount of the Eurodollar Loan of the Administrative Agent to
which such Interest Period applies, divided by (ii) a number equal to 1.00
minus the Eurocurrency Reserve Rate, if applicable.

     Events of Default. See §12.1.

     Existing Credit Agreements. The existing $650,000,000 Three-Year
Revolving Credit Agreement dated as of June 27, 2002 of the Borrower, and the
existing $1,750,000,000 Five-Year Revolving Credit Agreement dated as of June
29, 2001 of the Borrower, as amended.

     Existing Letters of Credit. Those Letters of Credit that were issued
under the Existing Credit Agreements and are outstanding as of the date hereof,
and which are identified in Schedule 3.1.2 hereof.

     Facility Fee. See §2.2.

     Federal Funds Rate. For any day, the rate per annum (rounded upward, if
necessary, to the nearest 1/100 of 1%) equal to the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as published by
the Federal Reserve Bank of New York on the Business Day next succeeding such
day, provided that (i) 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 (ii) if
no such rate is so published on such next succeeding Business Day, the Federal
Funds Rate for such day shall be the average of the quotations received by the
Administrative Agent from three Federal funds brokers of recognized standing
selected by the Administrative Agent.

     Financial Affiliate. A subsidiary of the bank holding company controlling
any Bank, which subsidiary is engaging in any of the activities permitted by
§4(e) of the Bank Holding Company Act of 1956 (12 U.S.C. §1843).

     Generally accepted accounting principles or GAAP. (i) When used in this
Agreement, whether directly or indirectly through reference to a capitalized
term used therein, means (A) principles that are consistent with the principles
promulgated or adopted by the Financial Accounting Standards Board and its
predecessors, in effect for the fiscal year ended on the Balance Sheet Date,
and (B) to the extent consistent with such principles, the accounting practice
of the Borrower reflected in its financial statements for the year ended on the
Balance Sheet Date; provided, that in each of (A) and (B), such meaning shall
include the application of Financial Accounting Standards Board Interpretation
No. 46, Consolidation of Variable Interest Entities (revised December 2003)
(“FIN 46-R”), provided, further, that in each case referred to in this
definition of “generally accepted accounting principles” a certified public
accountant would, insofar as the use of such accounting principles is
pertinent, be in a position to deliver an unqualified opinion (other than a
qualification regarding changes in generally accepted accounting principles) as
to financial statements in which such principles have been properly applied.

- 8 -

 

     Guaranteed Obligations. See §28.1.

     Guaranteed Pension Plan. Any employee pension benefit plan within the
meaning of §3(2) of ERISA maintained or contributed to by the Borrower, its
Subsidiaries or any ERISA Affiliate the benefits of which are guaranteed on
termination in full or in part by the PBGC pursuant to Title IV of ERISA, other
than a Multiemployer Plan.

     Guarantor. See Preamble.

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

     Hazardous Substances. See §6.15(b).

     Indebtedness. Collectively, without duplication, whether classified as
Indebtedness, an Investment or otherwise on the obligor’s balance sheet, (a)
all indebtedness for borrowed money, (b) all obligations for the deferred
purchase price of property or services (other than trade payables incurred in
the ordinary course of business which either (i) are not overdue by more than
ninety (90) days, or (ii) are being disputed in good faith and for which
adequate reserves have been established in accordance with GAAP), (c) all
obligations evidenced by notes, bonds, debentures or other similar debt
instruments, (d) all obligations created or arising under any conditional sale
or other title retention agreement with respect to property acquired (even
though the rights and remedies of the seller or lender under such agreement in
the event of default are limited to repossession or sale of such property), (e)
all obligations, liabilities and indebtedness under Capitalized Leases, (f) all
obligations, liabilities or indebtedness arising from the making of a drawing
under surety, performance bonds, or any other bonding arrangement, (g)
Guaranties with respect to all Indebtedness of others referred to in clauses
(a) through (f) above, and (h) all Indebtedness of others referred to in
clauses (a) through (f) above secured or supported by (or for which the holder
of such Indebtedness has an existing right, contingent or otherwise, to be
secured or supported by) any Lien on the property or assets of the Borrower or
any Subsidiary, even though the owner of the property has not assumed or become
liable, contractually or otherwise, for the payment of such Indebtedness;
provided that if a Permitted Receivables Transaction is outstanding and is
accounted for as a sale of accounts receivable under generally accepted
accounting principles, Indebtedness shall also include the additional
Indebtedness, determined on a

- 9 -

 

consolidated basis, which would have been outstanding had such Permitted
Receivables Transaction been accounted for as a borrowing.

     Interest Period. With respect to each Loan (a) initially, the period
commencing on the Drawdown Date of such Loan and ending on the last day of one
of the periods set forth below, as selected by the Borrower in accordance with
this Agreement (i) for any Base Rate Loan or Swing Line Loan, the first day of
the following month; (ii) for any Eurodollar Loan, 1, 2, 3, or 6 months; (iii)
for any Absolute Competitive Bid Loan, from 7 through 180 days; and (iv) for
any Eurodollar Competitive Bid Loan, 1, 2, 3, 4, 5, or 6 months; and (b)
thereafter, each period commencing on the last day of the next preceding
Interest Period applicable to such Loan and ending on the last day of one of
the periods set forth above, as selected by the Borrower in accordance with
this Agreement or if such period has no numerically corresponding day, on the
last Business Day of such period; provided that any Interest Period which would
otherwise end on a day which is not a Business Day shall be deemed to end on
the next succeeding Business Day; provided further that for any Interest Period
for any Eurodollar Loan or Eurodollar Competitive Bid Loan, if such next
succeeding Business Day falls in the next succeeding calendar month, such
Interest Period shall be deemed to end on the next preceding Business Day; and
provided further that no Interest Period shall extend beyond the Maturity Date.

     Interim Balance Sheet Date. June 30, 2004.

     Investments. All expenditures made by a Person and all liabilities
incurred (contingently or otherwise) by a Person for the acquisition of stock
of (other than the stock of Subsidiaries), or Indebtedness of, or for loans,
advances, capital contributions or transfers of property to, or in respect of
any Guaranties or other commitments as described under Indebtedness, or
obligations of, any other Person, including without limitation, the funding of
any captive insurance company (other than loans, advances, capital
contributions or transfers of property to any Subsidiaries or variable interest
entities consolidated in accordance with FIN 46-R, or Guaranties with respect
to Indebtedness of any Subsidiary or variable interest entities consolidated in
accordance with FIN 46-R). In determining the aggregate amount of Investments
outstanding at any particular time: (a) the amount of any Investment
represented by a Guaranty shall be taken at not less than the principal amount
of the obligations guaranteed and still outstanding; (b) there shall be
included as an Investment all interest accrued with respect to Indebtedness
constituting an Investment unless and until such interest is paid; (c) there
shall be deducted in respect of each such Investment any amount received as a
return of capital (but only by partial or full repurchase, redemption,
retirement, repayment, liquidating dividend or liquidating distribution); (d)
there shall not be deducted in respect of any Investment any amounts received
as earnings on such Investment, whether as dividends, interest or otherwise,
except that accrued interest included as provided in the foregoing clause (b)
may be deducted when paid; and (e) there shall not be deducted from the
aggregate amount of Investments any decrease in the value thereof.

     Issuance Fee. See §3.6.

     Issuing Banks. (i) Fleet National Bank, JPMorgan Chase Bank, Citibank,
Wachovia Bank, SunTrust Bank, PNC Bank National Association and BNP Paribas,
(ii) solely for

- 10 -

 

purposes of acting as issuer of Existing Letters of Credit, Deutsche Bank
AG and (iii) any other Bank that agrees (in its sole discretion) to act as
Issuing Bank pursuant to an instrument in writing in form and substance
satisfactory to such Bank, the Borrower and the Administrative Agent and signed
by them (which instrument shall set forth the maximum aggregate face amount of
all Letters of Credit of such Issuing Bank and shall, as to such maximum
amount, automatically be deemed to supplement Schedule 3.1 hereto); provided,
that in the case of any Existing Letter of Credit that was issued through an
affiliate of an Issuing Bank, such Letter of Credit shall be deemed for
purposes of §3.1(a) to have been issued by such Issuing Bank and the provisions
of Section 3.1(g) shall apply.

     Lead Arrangers and Book Managers. Banc of America Securities LLC and J.P.
Morgan Securities Inc., as Lead Arrangers and Book Managers in connection with
the credit facility provided herein.

     Letter of Credit Applications. Letter of credit applications in such form
or forms as may be agreed upon by the Borrower and the relevant Issuing Bank
from time to time which are entered into pursuant to §3 hereof, specifically
referencing this Agreement, as such Letter of Credit Applications may be
amended, varied or supplemented from time to time; provided, however, in the
event of any conflict or inconsistency between the terms of any Letter of
Credit Application and this Agreement, the terms of this Agreement shall
control.

     Letter of Credit Fee. See §3.6.

     Letter of Credit Participation. See §3.1(c).

     Letter of Credit Request. See §3.1(a).

     Letters of Credit. Letters of credit issued or to be issued by the
Issuing Banks under §3 hereof for the account of the Borrower (including
without limitation any Canadian Dollar Letters of Credit), and the Existing
Letters of Credit.

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

     Loan Documents. This Agreement, the Letter of Credit Applications, the
Letters of Credit and any documents, instruments or agreements executed in
connection with any of the foregoing, each as amended, modified, supplemented,
or replaced from time to time.

     Loans. Collectively, the Syndicated Loans, the Swing Line Loans and the
Competitive Bid Loans.

     Majority Banks. At any date, Banks the aggregate amount of whose
Commitments is greater than fifty percent (50%) of the Total Commitment;
provided that in the event that the

- 11 -

 

Total Commitment has been terminated, the Majority Banks shall be Banks
holding greater than fifty percent (50%) of the aggregate outstanding principal
amount of the Obligations on such date.

     Material Adverse Effect. A material adverse effect on (a) the business,
assets, operations, or financial condition of the Borrower and the Subsidiaries
taken as a whole, (b) the ability of the Borrower or the Guarantor to perform
any of its obligations under any Loan Document to which it is a party, or (c)
the rights of, or remedies or benefits available to, the Administrative Agent
or any Bank under any Loan Document.

     Maturity Date. October 15, 2009.

     Maximum Drawing Amount. At any time, the maximum aggregate amount from
time to time that the beneficiaries may draw under outstanding Letters of
Credit (using, in the case of Canadian Dollar Letters of Credit, the U.S.
Dollar Equivalent of the aggregate undrawn face amount thereof on the relevant
date).

     Moody’s. Moody’s Investors Service, Inc.

     Multiemployer Plan. Any multiemployer plan within the meaning of §3(37)
of ERISA maintained or contributed to by the Borrower, any of its Subsidiaries,
or any ERISA Affiliate.

     New Lending Office. See §5.1(d).

     Non-U.S. Bank. See §5.1(c).

     Notes. Notes issued according to §2.4(e).

     Obligations. All indebtedness, obligations and liabilities of the
Borrower to any of the Banks and the Administrative Agent arising or incurred
under this Agreement or any of the other Loan Documents or in respect of any of
the Loans made or Reimbursement Obligations incurred or the Letters of Credit,
or any other instrument at any time evidencing any thereof, individually or
collectively, existing on the date of this Agreement or arising thereafter,
whether direct or indirect, joint or several, absolute or contingent, matured
or unmatured, liquidated or unliquidated, secured or unsecured, arising by
contract, operation of law or otherwise.

     PBGC. The Pension Benefit Guaranty Corporation created by §4002 of ERISA
and any successor entity or entities having similar responsibilities.

     Permitted Liens. Any of the following Liens:

     (a) Liens for taxes not yet due or that are being contested in compliance
with §7.8;

     (b) carriers’, warehousemen’s, maritime, mechanics, materialmen’s,
repairmen’s or other like Liens arising in the ordinary course of business that
are being contested in good

- 12 -

 

faith by appropriate proceedings and for which adequate reserves with
respect thereto have been set aside as required by GAAP;

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

     (d) Liens to secure the performance of bids, trade contracts (other than
for Indebtedness), leases (other than Capital Leases), statutory obligations,
surety and appeal bonds, suretyship, performance and landfill closure bonds and
other obligations of a like nature incurred in the ordinary course of business;

     (e) zoning restrictions, easements, rights-of-way, restrictions on use of
property and other similar encumbrances incurred in the ordinary course of
business which, in the aggregate, are not substantial in amount and do not
materially detract from the value of the property subject thereto or interfere
with the ordinary conduct of the business of the Borrower or any of its
Subsidiaries;

     (f) the Liens on Schedule 1.1 hereto securing the obligations listed on
such Schedule and any replacement Lien securing any renewal, extension or
refunding of such obligations if the amount secured by such renewal, extension
or refunding Lien shall not exceed the amount of the outstanding obligations
secured by the Lien being replaced at the time of such renewal, extension or
refunding (plus transaction costs, including premiums and fees, related to such
renewal, extension or refunding) and if such replacement Lien shall be limited
to substantially the same property that secured the Lien so replaced;

     (g) legal or equitable encumbrances deemed to exist by reason of the
existence of any litigation or other legal proceeding or arising out of a
judgment or award with respect to which an appeal is being prosecuted in good
faith by appropriate action and with respect to which adequate reserves are
being maintained and, in the case of judgment liens, execution thereon is
stayed;

     (h) rights reserved or vested in any municipality or governmental,
statutory or public authority to control or regulate any property of the
Borrower or any Subsidiary, or to use such property in a manner that does not
materially impair the use of such property for the purposes for which it is
held by the Borrower or such Subsidiary;

     (i) any obligations or duties affecting the property of the Borrower or
any of its Subsidiaries to any municipality, governmental, statutory or public
authority with respect to any franchise, grant, license or permit;

     (j) Liens filed in connection with sales of receivables by any of the
Subsidiaries (other than the Guarantor) to a wholly-owned special purpose
financing Subsidiary for purposes of perfecting such sales, provided that no
third party has any rights with respect to such Liens or any assets subject
thereto;

- 13 -

 

     (k) any interest or title of a lessor under any sale lease-back
transaction entered into by the Borrower or any Subsidiary conveying only the
assets so leased back to the extent the related Indebtedness is permitted under
§8.1 hereof;

     (l) Liens created or deemed to be created under Permitted Receivables
Transactions at any time provided such Liens do not extend to any property or
assets other than the trade receivables sold pursuant to such Permitted
Receivables Transactions, interests in the goods or products (including
returned goods and products), if any, relating to the sales giving rise to such
trade receivables; any security interests or other Liens and property subject
thereto (other than on any leases or related lease payment rights or
receivables between the Borrower and any of its Subsidiaries, as lessors or
sublessors) from time to time purporting to secure the payment by the obligors
of such trade receivables (together with any financing statements signed by
such obligors describing the collateral securing such trade receivables)
pursuant to such Permitted Receivables Transactions; and

     (m) Liens securing other Indebtedness, provided that the aggregate amount
of all liabilities, including any Indebtedness, of the Borrower and its
Subsidiaries secured by all Liens permitted in subsections (k), (1) and (m),
when added (without duplication) to the aggregate amount of Indebtedness of the
Borrower’s Subsidiaries permitted under §8.1(b) and Indebtedness with respect
to Permitted Receivables Transactions, shall not exceed 15% of Consolidated
Tangible Assets at any time.

     Permitted Receivables Transaction. Any sale or sales of, and/or
securitization of, any accounts receivable of the Borrower and/or any of its
Subsidiaries (the “Receivables”) pursuant to which (a) the Borrower and its
Subsidiaries realize aggregate net proceeds of not more than $750,000,000 at
any one time outstanding, including, without limitation, any revolving
purchase(s) of Receivables where the maximum aggregate uncollected purchase
price (exclusive of any deferred purchase price) for such Receivables at any
time outstanding does not exceed $750,000,000, and (b) which Receivables shall
not be discounted more than 25%.

     Person. Any individual, corporation, partnership, joint venture, limited
liability company, trust, unincorporated association, business, or other legal
entity, and any government or any governmental agency or political subdivision
thereof.

     Pricing Table:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Applicable	 	 	 	 	 	 	 	Applicable
	 	 	Senior Public Debt	 	Facility	 	Applicable	 	Applicable	 	Eurodollar
	Level
	 	Rating
	 	Fee Rate
	 	L/C Rate
	 	Base Rate
	 	Rate

	1

	 	Greater than or
equal to A- by
Standard & Poor’s
or greater than or
equal to A3 by
Moody’s
	 	0.1000%

per annum
	 	0.2750% 

per annum
	 	Base Rate

per annum
	 	Eurodollar

Rate plus
 0.2750% per

annum
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	2

	 	BBB+ by Standard &
	 	 	0.1250	%	 	 	0.3750	%	 	Base Rate
	 	Eurodollar

- 14 -

 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Applicable	 	 	 	 	 	 	 	Applicable
	 	 	Senior Public Debt	 	Facility	 	Applicable	 	Applicable	 	Eurodollar
	Level
	 	Rating
	 	Fee Rate
	 	L/C Rate
	 	Base Rate
	 	Rate

	

	 	Poor’s or Baa1 by
Moody’s
	 	per annum
	 	per annum
	 	per annum
	 	Rate plus
 0.3750% per

annum
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	3

	 	BBB by Standard &
Poor’s or Baa2 by
Moody’s
	 	0.1500%

per annum
	 	0.4750%

per annum
	 	Base Rate

per annum
	 	Eurodollar
 Rate
plus
 0.4750% per

annum
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	4

	 	BBB- by Standard &
Poor’s or Baa3 by
Moody’s
	 	0.1750%

per annum
	 	0.7000%

per annum
	 	Base Rate

per annum
	 	Eurodollar
 Rate
plus
 0.7000% per

annum
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	5

	 	BB+ by Standard &
Poor’s or Ba1 by
Moody’s
	 	0.2250%

per annum
	 	0.9000%

per annum
	 	Base Rate

per annum
	 	Eurodollar
 Rate
plus
 0.9000% per

annum
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	6

	 	Less than or equal
to BB by Standard &
Poor’s or less than
or equal to Ba2 by
Moody’s
	 	0.2500%

per annum
	 	1.1250% 

per annum
	 	Base Rate plus

0.2000% per annum
	 	Eurodollar
 Rate
plus
 1.1250% per

annum

The applicable rates charged for any day shall be determined by the higher
Senior Public Debt Rating in effect as of that day, provided that if the higher
Senior Public Debt Rating is more than one level higher than the lower Senior
Public Debt Rating, the applicable rate shall be set at one level below the
higher Senior Public Debt Rating.

     RCRA. See §6.15(a).

     Real Property. All real property heretofore, now, or hereafter owned,
operated, or leased by the Borrower or any of its Subsidiaries.

     Reimbursement Obligation. The Borrower’s obligation to reimburse the
applicable Issuing Bank and the Banks on account of any drawing under any
Letter of Credit, all as provided in §3.2.

     Release. Shall have the meaning specified in the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C.
§§9601 et seq. (“CERCLA”) and the term “Disposal” (or “Disposed”) shall have
the meaning specified in the Resource Conservation and Recovery Act of 1976, 42
U.S.C. §§6901 et seq. (“RCRA”) and regulations promulgated thereunder;
provided, that in the event either CERCLA or RCRA is amended so as to broaden
the meaning of any term defined thereby, such broader meaning shall apply as of
the effective date of such amendment and provided further, to the extent that
the laws of Canada or a state, province, territory or other political
subdivision thereof wherein the

- 15 -

 

property lies establish a meaning for “Release” or “Disposal” which is
broader than specified in either CERCLA, or RCRA, such broader meaning shall
apply to the Borrower’s or any of its Subsidiaries’ activities in that state,
province, territory or political subdivision.

     Replacement Bank. See §5.12.

     Replacement Notice. See §5.12.

     Senior Public Debt Rating. The ratings of the Borrower’s public unsecured
long-term senior debt, without third party credit enhancement, issued by
Moody’s and Standard & Poor’s.

     Shareholder Suits. See the definition of “Consolidated Earnings Before
Interest and Taxes, or EBIT.”

     Significant Subsidiary. At any time, a Subsidiary that at such time meets
the definition of “significant subsidiary” contained in Regulation S-X of the
Securities and Exchange Commission as in effect on the date hereof, but as if
each reference in said definition to the figure “10 percent” were a reference
to the figure “3 percent”.

     Standard & Poor’s. Standard & Poor’s Ratings Services, a division of The
McGraw-Hill Companies, Inc.

     Subsidiary. Any corporation, association, trust, or other business entity
of which the designated parent shall at any time own directly or indirectly
through a Subsidiary or Subsidiaries at least a majority of the outstanding
capital stock or other interest entitled to vote generally and whose financial
results are required to be consolidated with the financial results of the
designated parent in accordance with GAAP.

     Swap Contracts. All obligations in respect of interest rate, currency or
commodity exchange, forward, swap, or futures contracts or similar transactions
or arrangements entered into to protect or hedge the Borrower and its
Subsidiaries against interest rate, exchange rate or commodity price risks or
exposure, or to lower or diversify their funding costs.

     Swing Line Bank. Citibank.

     Swing Line Loans. See §2.11(a).

     Swing Line Settlement. The making or receiving of payments, in
immediately available funds, by the Banks to or from the Administrative Agent
in accordance with §2.11 hereof to the extent necessary to cause each Bank’s
actual share of the outstanding amount of the Syndicated Loans to be equal to
such Bank’s Commitment Percentage of the outstanding amount of such Syndicated
Loans, in any case when, prior to such action, the actual share is not so
equal.

     Swing Line Settlement Amount. See §2.11(b).

     Swing Line Settlement Date. See §2.11(b).

- 16 -

 

     Swing Line Settling Bank. See §2.11(b).

     Syndicated Loan Request. See §2.6(a).

     Syndicated Loans. A Borrowing hereunder consisting of one or more loans
made by the Banks to the Borrower under the procedures described in §2.1(a) and
§2.11 hereof.

     Terminated Plans. The Waste Management, Inc. Pension Plan and The Waste
Management of Alameda County, Inc. Retirement Plan.

     Total Commitment. Initially $2,400,000,000, as such amount may be
increased or reduced in accordance with the terms hereof, or, if such Total
Commitment has been terminated pursuant to §2.3.1 or §12.2 hereof, zero.

     Total Debt. The sum, without duplication, of all (1) Indebtedness of the
Borrower on a consolidated basis under subsections (a) through (h) of the
definition of “Indebtedness” (provided, however, that Indebtedness with respect
to Permitted Receivables Transactions shall not be included in such
calculation), plus (2) non-contingent reimbursement obligations of the Borrower
and its Subsidiaries with respect to drawings under any letters of credit.

     Type. When used in reference to any Loan, refers to whether the rate of
interest on such Loan is determined by reference to the Eurodollar Rate, the
Base Rate or, in the case of a Competitive Bid Loan, whether it is a Eurodollar
Competitive Bid Loan or Absolute Competitive Bid Loan.

     U.S. Dollar Equivalent. With respect to any amount denominated in
Canadian Dollars on any date, an equivalent amount in U.S. Dollars, computed as
follows:

	(i)	 	for purposes of computing the Maximum
Drawing Amount as of the date of each borrowing of
Loans or the issuance of any Letter of Credit, the
equivalent in U.S. Dollars of the aggregate unused
face amount of all outstanding Canadian Dollar
Letters of Credit, computed by the Administrative
Agent on the basis of the Applicable Spot Rate as
determined by the Administrative Agent at
approximately 10:00 a.m. New York time on such
date;
	 
	(ii)	 	for purposes of computing the Maximum
Drawing Amount in connection with the computation
of Letter of Credit Fee payable under §3.6 hereof,
the equivalent in U.S. Dollars of the aggregate
unused face amount of all outstanding Canadian
Dollar Letters of Credit, computed by the
Administrative Agent on the basis of the
Applicable Spot Rate as determined by the
Administrative Agent at approximately 10:00 a.m.
New York time on the relevant quarterly date
referred to therein;
	 
	(iii)	 	for purposes of computing the amount
of Issuance Fee payable to any Issuing Bank, the
equivalent in U.S. Dollars of the face

- 17 -

 

	 	 	amount of each relevant Canadian Dollar Letter of
Credit, computed by such Issuing Bank on the basis
of the Applicable Spot Rate as determined by such
Issuing Bank at approximately 10:00 a.m. New York
time on the date of issuance of such Letter of
Credit;
	 
	(iv)	 	for purposes of computing the amount
in U.S. Dollars of any payment made by an Issuing
Bank in Canadian Dollars in respect of a drawing
under a Canadian Dollar Letter of Credit, the
equivalent in U.S. Dollars of the amount of such
payment, computed by such Issuing Bank on the
basis of the Applicable Spot Rate as determined by
such Issuing Bank at the time of such payment; and
	 
	(v)	 	for purposes of determining the
amount, if any, required to be prepaid on any date
under §5.2 hereof, the equivalent in U.S. Dollars
of the aggregate unused face amount of all
Canadian Dollar Letters of Credit, computed by the
Administrative Agent on the basis of the
Applicable Spot Rate as determined by the
Administrative Agent at approximately 10:00 a.m.
New York time on such date.

          §1.2. Rules of Interpretation.

     (a) Unless otherwise noted, a reference to any document or agreement
(including this Agreement) shall include such document or agreement as
amended, modified or supplemented from time to time in accordance with its
terms and the terms of this Agreement.

     (b) The singular includes the plural and the plural includes the
singular.

     (c) A reference to any law includes any amendment or modification to
such law.

     (d) A reference to any Person includes its permitted successors and
permitted assigns.

     (e) Accounting terms capitalized but not otherwise defined herein
have the meanings assigned to them by generally accepted accounting
principles applied on a consistent basis by the accounting entity to
which they refer.

     (f) The words “include”, “includes” and “including” are not
limiting.

     (g) All terms not specifically defined herein or by generally
accepted accounting principles, which terms are defined in the Uniform
Commercial Code as in effect in the State of New York, have the meanings
assigned to them therein.

- 18 -

 

     (h) Reference to a particular “§” refers to that section of this
Agreement unless otherwise indicated.

     (i) The words “herein”, “hereof’, “hereunder” and words of like
import shall refer to this Agreement as a whole and not to any particular
section or subdivision of this Agreement.

          §1.3. Classification of Loans and Borrowings. For purposes of this Agreement,
Loans may be classified and referred to by Class (e.g., a “Syndicated Loan”) or
by Type (e.g., a “Eurodollar Loan”) or by Class and Type (e.g., a “Eurodollar
Syndicated Loan”).

§2. THE LOAN FACILITIES.

          §2.1. Commitment to Lend.

     (a) Subject to the terms and conditions set forth in this Agreement,
each of the Banks severally agrees to lend to the Borrower and the
Borrower may borrow, repay, and reborrow from time to time between the
Effective Date and the Maturity Date, upon notice by the Borrower to the
Administrative Agent given in accordance with this §2, its Commitment
Percentage of the Syndicated Loans requested by the Borrower; provided
that the sum of the outstanding principal amount of the Syndicated Loans
(including the Swing Line Loans) and the Maximum Drawing Amount of
outstanding Letters of Credit shall not exceed the Total Commitment minus
the aggregate amount of Competitive Bid Loans outstanding at such time.

     (b) On the date of each request for a Loan or Letter of Credit
hereunder, the Borrower shall be deemed to have made a representation and
warranty that the conditions set forth in §10 and §11, as the case may be,
have been satisfied on the date of such request. Any unpaid Reimbursement
Obligation shall be a Base Rate Loan, as set forth in §3.2(a).

          §2.2. Facility Fee. The Borrower agrees to pay to the Administrative Agent for
the account of the Banks a fee (the “Facility Fee”) on the Total Commitment
(whether or not utilized) equal to the Applicable Facility Fee Rate multiplied
by the Total Commitment, provided that after the expiry or termination of the
Total Commitment, the Facility Fee shall be computed on the sum of (A) the
Maximum Drawing Amount of all Letters of Credit, if any, outstanding from time
to time and (B) all Loans outstanding from time to time. The Facility Fee shall
be payable for the period from and after the Effective Date quarterly in
arrears on the first day of each calendar quarter for the immediately preceding
calendar quarter with the first such payment commencing on January 1, 2005 and
on the Maturity Date (or on the date of termination in full of the Total
Commitment, if earlier) and on the date of termination of all Letters of Credit
and payment in full of all Loans. The Facility Fee shall be distributed pro
rata among the Banks in accordance with each Bank’s Commitment Percentage.

          §2.3. Reduction and Increase of Total Commitment.

               §2.3.1. Reduction of Total Commitment.

- 19 -

 

     (a) The Borrower shall have the right at any time and from time to
time upon three (3) Business Days’ prior written notice to the
Administrative Agent to reduce by $25,000,000 or a greater amount, or
terminate entirely, the Total Commitment, whereupon each Bank’s Commitment
shall be reduced pro rata in accordance with such Bank’s Commitment
Percentage of the amount specified in such notice or, as the case may be,
terminated; provided that at no time may the Total Commitment be reduced
to an amount less than the sum of (A) the Maximum Drawing Amount of all
Letters of Credit, and (B) all Loans then outstanding.

     (b) No reduction or termination of the Total Commitment once made may
be revoked; the portion of the Total Commitment reduced or terminated may
not be reinstated; and amounts in respect of such reduced or terminated
portion may not be reborrowed.

     (c) The Administrative Agent will notify the Banks promptly after
receiving any notice delivered by the Borrower pursuant to this §2.3.1 and
will distribute to each Bank a revised Schedule 1 to this Agreement.

               §2.3.2. Increase of Total Commitment. Unless a Default or Event of Default has
occurred and is continuing, the Borrower may request, subject to the approval
of the Administrative Agent, that the Total Commitment be increased, provided
that the Total Commitment shall not, except with the consent of the Majority
Banks, in any event exceed $3,000,000,000 hereunder; provided, however, that
(i) any Bank which is a party to this Agreement prior to such increase shall
have the first option, and may elect, to fund its pro rata share of the
increase, thereby increasing its Commitment hereunder, but no Bank shall have
any obligation to do so, (ii) in the event that it becomes necessary to include
a new Bank to provide additional funding under this §2.3.2, such new Bank must
be reasonably acceptable to the Administrative Agent and the Borrower, and
(iii) the Banks’ Commitment Percentages shall be correspondingly adjusted, as
necessary, to reflect any increase in the Total Commitment and Schedule 1 shall
be amended to reflect such adjustments. Any such increase in the Total
Commitment shall require, among other things, the satisfaction of such
conditions precedent as the Administrative Agent may reasonably require,
including, without limitation, the Administrative Agent’s receipt of evidence
of applicable corporate authorization and other corporate documentation from
the Borrower and the Guarantor and the legal opinion of
counsel to the Borrower and the Guarantor, each in form and substance
satisfactory to the Administrative Agent and such Banks as are participating in
such increase.

          §2.4. Repayment of Loans; Evidence of Debt.

     (a) The Borrower hereby unconditionally promises to pay (i) to the
Administrative Agent for the pro rata account of the Banks, the then
unpaid principal amount of the Syndicated Loans on the Maturity Date, (ii)
to the Administrative Agent for the account of the applicable Bank, the
then unpaid principal amount of such Bank’s Competitive Bid Loan on the
last day of the Interest Period applicable to such Loan, and (iii) to the
Swing Line Bank, for its account, the then unpaid principal amount of each
Swing Line Loan on the earlier of the Maturity Date and the first date
after such Swing Line Loan is made that is the 15th or last day of a
calendar month and is at least two

- 20 -

 

Business Days after such Swing Line
Loan is made; provided that on each date that a Syndicated Loan or
Competitive Bid Loan is made, the Borrower shall repay all Swing Line
Loans then outstanding.

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

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

     (d) The entries made in the accounts maintained pursuant to paragraph
(b) or (c) of this §2.4 shall be prima facie evidence of the existence and
amounts of the obligations recorded therein; provided that the failure of
any Bank or the Administrative Agent to maintain such accounts or any
error therein shall not in any manner affect the obligation of the
Borrower to repay the Loans in accordance with the terms of this
Agreement.

     (e) Any Bank may request that any Loans made by it be evidenced by a
promissory note. In such event, the Borrower shall prepare, execute and
deliver to such Bank a promissory note payable to the order of such Bank
(or, if requested by Bank, to such Bank and its registered assigns) and in
a form approved by the Administrative Agent. Thereafter, the Loans
evidenced by such promissory note and interest thereon shall at all times
(including after assignment pursuant to §20) be represented by one or more
promissory notes in such form payable to the order of the payee named
therein (or, if such promissory note is a registered note, to such payee
and its registered assigns).

          §2.5. Interest on Loans.

     (a) The outstanding principal amount of the Syndicated Loans shall
bear interest at the rate per annum equal to (i) the Applicable Base Rate
on Base Rate Loans, (ii) the Applicable Eurodollar Rate on Eurodollar
Loans and (iii) the Applicable Swing Line Rate on Swing Line Loans.

     (b) Interest shall be payable (i) quarterly in arrears on the first
Business Day of each quarter, with the first such payment commencing
January 1, 2005, on Base Rate Loans, (ii) on the last day of the
applicable Interest Period, and if such Interest Period is longer than
three months, also on the last day of each three month period following
the commencement of such Interest Period, on Eurodollar Loans, and (iii)
on the Maturity Date for all Loans.

          §2.6. Requests for Syndicated Loans.

- 21 -

 

     (a) The Borrower shall give to the Administrative Agent written
notice in the form of Exhibit A hereto (or telephonic notice confirmed in
writing or a facsimile in the form of Exhibit A hereto) of each
Syndicated Loan requested hereunder (a “Syndicated Loan Request”) not
later than (a) 11:00 a.m. (New York time) on the proposed Drawdown Date
of any Base Rate Loan, or (b) 11:00 a.m. (New York time) three (3)
Eurodollar Business Days prior to the proposed Drawdown Date of any
Eurodollar Loan. Each such Syndicated Loan Request shall specify (A) the
principal amount of the Syndicated Loan requested, (B) the proposed
Drawdown Date of such Syndicated Loan, (C) whether such Syndicated Loan
requested is to be a Base Rate Loan or a Eurodollar Loan, and (D) the
Interest Period for such Syndicated Loan, if a Eurodollar Loan. Each
Syndicated Loan requested shall be in a minimum amount of $10,000,000.
Each such Syndicated Loan Request shall reflect the Maximum Drawing
Amount of all Letters of Credit outstanding and the amount of all Loans
outstanding (including Competitive Bid Loans and Swing Line Loans).
Syndicated Loan Requests made hereunder shall be irrevocable and binding
on the Borrower, and shall obligate the Borrower to accept the Syndicated
Loan requested from the Banks on the proposed Drawdown Date.

     (b) Each of the representations and warranties made by the Borrower
to the Banks or the Administrative Agent in this Agreement or any other
Loan Document shall be true and correct in all material respects when
made and shall, for all purposes of this Agreement, be deemed to be
repeated by the Borrower on and as of the date of the submission of a
Syndicated Loan Request, Competitive Bid Quote Request, or Letter of
Credit Application and on and as of the Drawdown Date of any Loan or the
date of issuance of any Letter of Credit (except to the extent (i) of
changes resulting from transactions contemplated or permitted by this
Agreement and the other Loan Documents, (ii) of changes occurring in the
ordinary course of business that either individually or in the aggregate
do not result in a Material Adverse Effect, or (iii) that such
representations and warranties expressly relate only to an earlier date).

     (c) The Administrative Agent shall promptly notify each Bank of each
Syndicated Loan Request received by the Administrative Agent (i) on the
proposed Drawdown Date of any Base Rate Loan, or (ii) three (3) Eurodollar
Business Days prior to the proposed Drawdown Date of any Eurodollar Loan.

          §2.7. Election of Eurodollar Rate; Notice of Election; Interest Periods;
Minimum Amounts.

     (a) At the Borrower’s option, so long as no Default or Event of
Default has occurred and is then continuing, the Borrower may (i) elect to
convert any Base Rate Loan or a portion thereof to a Eurodollar Loan, (ii)
at the time of any Syndicated Loan Request, specify that such requested
Loan shall be a Eurodollar Loan, or (iii) upon expiration of the
applicable Interest Period, elect to maintain an existing Eurodollar Loan
as such, provided that the Borrower give notice to the Administrative
Agent pursuant to §2.7(b) hereof. Upon determining any Eurodollar Rate,
the Administrative Agent shall forthwith provide notice thereof to the
Borrower and the Banks, and each such notice to the Borrower shall be
considered prima facie correct and binding, absent manifest error.

- 22 -

 

     (b) Three (3) Eurodollar Business Days prior to the making of any
Eurodollar Loan or the conversion of any Base Rate Loan to a Eurodollar
Loan, or, in the case of an outstanding Eurodollar Loan, the expiration
date of the applicable Interest Period, the Borrower shall give written,
telex or facsimile notice (or telephonic notice promptly confirmed in a
writing or a facsimile) received by the Administrative Agent not later
than 11:00 a.m. (New York time) of its election pursuant to §2.7(a). Each
such notice delivered to the Administrative Agent shall specify the
aggregate principal amount of the Syndicated Loans to be borrowed or
maintained as or converted to Eurodollar Loans and the requested duration
of the Interest Period that will be applicable to such Eurodollar Loan,
and shall be irrevocable and binding upon the Borrower. If the Borrower
shall fail to give the Administrative Agent notice of its election
hereunder together with all of the other information required by this
§2.7(b) with respect to any Syndicated Loan, whether at the end of an
Interest Period or otherwise, such Syndicated Loan shall be deemed a Base
Rate Loan. The Administrative Agent shall promptly notify the Banks in
writing (or by telephone confirmed in writing or by facsimile) of such
election.

     (c) Notwithstanding anything herein to the contrary, the Borrower may
not specify an Interest Period that would extend beyond the Maturity Date.

     (d) No conversion of Loans pursuant to this §2.7 may result in any
Eurodollar Borrowing that is less than $5,000,000. In no event shall the
Borrower have more than ten (10) different Interest Periods for Borrowings
of Eurodollar Loans outstanding at any time.

     (e) Subject to the terms and conditions of §5.8 hereof, if any
Affected Bank demands compensation under §5.5(c) or (d) with respect to
any Eurodollar Loan, the Borrower may at any time, upon at least three (3)
Business Days’ prior written notice to
the applicable Administrative Agent, elect to convert such Eurodollar
Loan into a Base Rate Loan (on which interest and principal shall be
payable contemporaneously with the related Eurodollar Loans of the other
Banks). Thereafter, and until such time as the Affected Bank notifies the
Administrative Agent that the circumstances giving rise to the demand for
compensation under §5.5(c) or (d) no longer exist, all requests for
Eurodollar Loans from such Affected Bank shall be deemed to be requests
for Base Rate Loans. Once the Affected Bank notifies the Administrative
Agent that such circumstances no longer exist, the Borrower may elect that
the principal amount of each such Loan converted hereunder shall again
bear interest as Eurodollar Loans beginning on the first day of the next
succeeding Interest Period applicable to the related Eurodollar Loans of
the other Banks.

          §2.8. Funds for Syndicated Loans. Not later than 1:00 p.m. (New York time) on
the proposed Drawdown Date of Syndicated Loans, each of the Banks will make
available to the Administrative Agent at the Administrative Agent’s Account, in
immediately available funds, the amount of its Commitment Percentage of the
amount of the requested Loan. Upon receipt from each Bank of such amount, and
upon receipt of the documents required by §10 and §11 and the satisfaction of
the other conditions set forth therein, the Administrative Agent will make
available to the Borrower the aggregate amount of such Syndicated Loans made
available by the Banks. The failure or refusal of any Bank to make available to
the

- 23 -

 

Administrative Agent at the aforesaid time and place on any Drawdown Date
the amount of its Commitment Percentage of the requested Syndicated Loan shall
not relieve any other Bank from its several obligations hereunder to make
available to the
Administrative Agent the amount of such Bank’s Commitment
Percentage of the requested Loan.

          §2.9. Maturity of the Loans and Reimbursement Obligations. The Borrower
promises to pay on the Maturity Date, and there shall become absolutely due and
payable on the Maturity Date, all of the Loans and unpaid Reimbursement
Obligations outstanding on such date, together with any and all accrued and
unpaid interest thereon and any fees and other amounts owing hereunder.

          §2.10. Optional Prepayments or Repayments of Loans. Subject to the terms and
conditions of §5.8, the Borrower shall have the right, at its election, to
repay or prepay the outstanding amount of the Loans, as a whole or in part, at
any time without penalty or premium. The Borrower shall give the Administrative
Agent no later than 11:00 a.m. (New York time) (a) on the proposed date of
prepayment or repayment of Base Rate Loans, and (b) three (3) Eurodollar
Business Day prior to the proposed date of prepayment or repayment of all other
Loans, written notice (or telephonic notice confirmed in writing or by
facsimile) of any proposed prepayment or repayment pursuant to this §2.10,
specifying the proposed date of prepayment or repayment of Loans and the
principal amount to be paid. Notwithstanding the foregoing, the Borrower may
not prepay any Competitive Bid Loans without the consent of the applicable
Bank. The Administrative Agent shall promptly notify each Bank by written
notice (or telephonic notice confirmed in writing or by facsimile) of such
notice of payment.

          §2.11. Swing Line Loans; Settlements.

     (a) Notwithstanding the notice and minimum amount requirements set
forth in §2.6 but otherwise in accordance with the terms and conditions of
this Agreement, and solely for ease of administration of the Syndicated
Loans, the Swing Line Bank may, but shall not be required to, fund Base
Rate Loans made in accordance with the provisions of this Agreement
(“Swing Line Loans”).

     At the discretion of the Swing Line Bank, Swing Line Loans may be in
amounts less than $10,000,000 provided that the outstanding amount of
Swing Line Loans advanced by the Swing Line Bank hereunder shall not
exceed $100,000,000 at any time. Each Bank shall remain severally and
unconditionally liable to fund its pro rata share (based upon each Bank’s
Commitment Percentage) of such Swing Line Loans on each Swing Line
Settlement Date and, in the event the Swing Line Bank chooses not to fund
any Swing Line Loans requested on any date, to fund its Commitment
Percentage of the Base Rate Loans requested, subject to satisfaction of
the provisions hereof relating to such Bank’s Commitment to make the Base
Rate Loans. Prior to each Swing Line Settlement, all payments or
repayments of the principal of, and interest on, Swing Line Loans shall be
credited to the account of the Swing Line Bank.

     (b) The Banks shall effect Swing Line Settlements on (i) the Business
Day immediately following any day which the Administrative Agent gives
written notice to

- 24 -

 

effect a Swing Line Settlement, (ii) the Business Day
immediately following the Administrative Agent’s becoming aware of the
existence of any Default or Event of Default and (iii) the Maturity Date
(each such date, a “Swing Line Settlement Date”). One (1) Business Day
prior to each such Swing Line Settlement Date, the Administrative Agent
shall give telephonic notice to the Banks of (A) the respective
outstanding amount of Syndicated Loans made by each Bank as at the close
of business on the prior day, (B) the amount that any Bank, as applicable
(a “Swing Line Settling Bank”), shall pay to effect a Swing Line
Settlement (a “Swing Line Settlement Amount”) and (C) the portion (if any)
of the aggregate Swing Line Settlement Amount to be paid to each Bank. A
statement of the Administrative Agent submitted to the Banks with respect
to any amounts owing hereunder shall be prima facie evidence of the amount
due and owing. Each Swing Line Settling Bank shall, not later than 1:00
p.m. (New York time) on each Swing Line Settlement Date, effect a wire
transfer of immediately available funds to the Administrative Agent at its
Loan Office in the amount of such Bank’s Swing Line Settlement Amount. The
Administrative Agent shall, as promptly as practicable during normal
business hours on each Swing Line Settlement Date, effect a wire transfer
of immediately available funds to each Bank of the Swing Line Settlement
Amount to be paid to such Bank. All funds advanced by any Bank as a Swing
Line Settling Bank pursuant to this §2.11 (b) shall for all purposes be
treated as a Base Rate Loan made by such Swing Line Settling Bank to the
Borrower, and all funds received by any Bank pursuant to this §2.11 (b)
shall for all purposes be treated as repayment of amounts owed by the
Borrower with respect to Base Rate Loans made by such Bank.

     (c) The Administrative Agent may (unless notified to the contrary by
any Swing Line Settling Bank by 12:00 noon (New York time) one (1)
Business Day prior to the Settlement Date) assume that each Swing Line
Settling Bank has made available (or will make available by the time
specified in §2.11(b)) to the Administrative Agent its Swing Line
Settlement Amount, and the Administrative Agent may (but shall not be
required to), in reliance upon such assumption, make available to each
applicable Bank its share (if any) of the aggregate Swing Line Settlement
Amount. If the Swing Line Settlement Amount of such Swing Line Settling
Bank is made available to the Administrative Agent by such Swing Line
Settling Bank on a date after such Swing Line Settlement Date, such Swing
Line Settling Bank shall pay the Swing Line Bank on demand an amount equal
to the product of (i) the average, computed for the period referred to in
clause (iii) below, of the weighted average annual interest rate paid by
the Swing Line Bank for federal funds acquired by the Swing Line Bank
during each day included in such period times (ii) such Swing Line
Settlement Amount times (iii) a fraction, the numerator of which is the
number of days that elapse from and including such Swing Line Settlement
Date to but not including the date on which such Swing Line Settlement
Amount shall become immediately available to the Swing Line Bank, and the
denominator of which is 365. Upon payment of such amount such Swing Line
Settling Bank shall be deemed to have delivered its Swing Line Settlement
Amount on the Swing Line Settlement Date and shall become entitled to
interest payable by the Borrower with respect to such Swing Line Settling
Bank’s Swing Line Settlement Amount as if such share were delivered on the
Swing Line Settlement Date. If such Swing Line Settlement Amount is not in
fact made available to the Swing Line Bank by such Swing Line Settling
Bank within three (3) Business

- 25 -

 

Days of such Swing Line Settlement Date,
the Swing Line Bank shall be entitled to recover such amount from the
Borrower, with interest thereon at the Applicable Base Rate.

     (d) After any Swing Line Settlement Date, any payment by the Borrower
of Swing Line Loans hereunder shall be allocated among the Banks, in
amounts determined so as to provide that after such application and the
related Swing Line Settlement, the outstanding amount of Syndicated Loans
of each Bank equals, as nearly as practicable, such Bank’s Commitment
Percentage of the aggregate amount of Syndicated Loans.

§3. LETTERS OF CREDIT.

          §3.1. Letter of Credit Commitments.

     (a) Subject to the terms and conditions hereof and the receipt by the
Administrative Agent of a written notice in the form of Exhibit B hereto
(a “Letter of Credit Request”) reflecting the Maximum Drawing Amount of
all Letters of Credit (including the requested Letter of Credit), and
receipt by an Issuing Bank, with a copy to
the Administrative Agent, of a Letter of Credit Application, such
Issuing Bank, on behalf of the Banks and in reliance upon the
representations and warranties of the Borrower contained herein and the
agreement of the Banks contained in §3.1(c) hereof, agrees to issue
standby Letters of Credit (including so-called “direct pay” standby
Letters of Credit) for the account of the Borrower (which may, with such
Issuing Bank’s consent, incorporate automatic renewals for periods of up
to twelve (12) months), in such form as may be requested from time to time
by the Borrower and agreed to by such Issuing Bank; provided, however,
that, after giving effect to such request, the aggregate Maximum Drawing
Amount of all Letters of Credit issued at any time shall not exceed the
Total Commitment minus the aggregate outstanding amount of the Loans;
provided further, that no Letter of Credit shall have an expiration date
later than the earlier of (i) eighteen (18) months after the date of
issuance (which may incorporate automatic renewals for periods of up to
twelve (12) months), or (ii) five (5) Business Days prior to the Maturity
Date; and provided further, that the aggregate face amount of all Letters
of Credit issued by any one Issuing Bank shall not at any time exceed the
amount set forth opposite the name of such Issuing Bank on Schedule 3.1
hereto, as such amount may be increased (in the sole discretion of such
Issuing Bank) or decreased (if so agreed by such Issuing Bank and the
Borrower) by the execution and delivery by such Issuing Bank, the
Borrower, the Guarantor and the Administrative Agent of an instrument in
substantially the form of Schedule 3.1.1 hereto. Each Issuing Bank will
promptly confirm to the Administrative Agent the issuance of each Letter
of Credit specifying the face amount thereof, and the Administrative Agent
will transmit such information to the Banks.

     (b) Each Letter of Credit shall be denominated in Dollars or, in
accordance with and subject to the terms of §3.1(e) hereof, in Canadian
Dollars.

     (c) Each Bank severally agrees that it shall be absolutely liable,
without regard to the occurrence of any Default or Event of Default, the
termination of the Total

- 26 -

 

Commitment pursuant to §12.2, or any other
condition precedent or circumstance whatsoever (other than as stated in
the next sentence hereof), to the extent of such Bank’s Commitment
Percentage to reimburse each Issuing Bank on demand for the amount of each
draft paid by such Issuing Bank under each Letter of Credit issued by such
Issuing Bank to the extent that such amount is not reimbursed by the
Borrower pursuant to §3.2 (such agreement of a Bank being called herein
the “Letter of Credit Participation” of such Bank). Each Bank agrees that
its obligation to reimburse each Issuing Bank pursuant to this §3.1(c)
shall not be affected in any way by any circumstance whatsoever other than
the gross negligence or willful misconduct of such Issuing Bank, provided
that the making of a payment under a Letter of Credit against documents
that appear on their face to substantially comply with the terms and
conditions of such Letter of Credit shall not be deemed to be gross
negligence or willful misconduct.

     (d) Each such reimbursement payment made by a Bank to an Issuing Bank
shall be made to an account of such Issuing Bank in the United States of
America and shall be treated as the purchase by such Bank of a
participating interest in the applicable Reimbursement Obligation under
§3.2 in an amount equal to such payment. Each Bank shall share in
accordance with its participating interest in any interest which accrues
pursuant to §3.2.

     (e) (i) The Borrower shall be entitled to request that one or more
Letters of Credit be denominated in Canadian Dollars for the account of
any Canadian Subsidiary of the Borrower (each a “Canadian Dollar Letter of
Credit”); provided that (i) the aggregate undrawn face amount of all
Canadian Dollar Letters of Credit may not exceed C$200,000,000 at any time
and (ii) each Canadian Dollar Letter of Credit shall provide for payment
of any drawing thereunder on a date not earlier than three Business Days
after the relevant Issuing Bank determines that the documents submitted in
connection with such drawing appear on their face to substantially comply
with the terms and conditions of such Letter of Credit.

     (ii) The Letter of Credit Application in respect of each Canadian
Dollar Letter of Credit shall be signed by the Borrower; provided that
nothing therein shall be deemed to alter the obligations of the Borrower
under this Agreement in respect of any drawing under any such Letter of
Credit.

     (iii) If an Issuing Bank makes a payment in Canadian Dollars
pursuant to a Canadian Dollar Letter of Credit, the amount of such
payment shall, for all purposes of this Agreement (but without prejudice
to the terms of such Letter of Credit), immediately be deemed converted
into the U.S. Dollar Equivalent thereof and shall for all purposes hereof
be deemed to have been made in U.S. Dollars in said amount.

     (f) As of the Effective Date, the Existing Letters of Credit shall
automatically be deemed to be Letters of Credit for all purposes of this
Agreement, having the respective face amounts specified in Schedule 3.1.2
hereof.

     (g) In the case of an Issuing Bank that has issued an Existing
Letter of Credit through an affiliate of such Issuing Bank, the
obligations of the other parties hereunder to

- 27 -

 

such Issuing Bank shall to
such extent inure to the benefit of such affiliate and be enforceable by
such Issuing Bank on behalf of such affiliate.

          §3.2. Reimbursement Obligation of the Borrower. In order to induce the Issuing
Banks to issue, extend and renew each Letter of Credit, the Borrower hereby
agrees to reimburse or pay to each Issuing Bank, with respect to each Letter of
Credit issued, extended or renewed by such Issuing Bank hereunder, as follows:

     (a) if any draft presented under any Letter of Credit is honored by
such Issuing Bank or such Issuing Bank otherwise makes payment with
respect thereto, the sum of (i) the amount paid by such Issuing Bank under
or with respect to such Letter of Credit (except that in the case of a
payment in Canadian Dollars, it shall reimburse or pay the U.S. Dollar
Equivalent thereof), and (ii) the amount of any taxes, fees, charges or
other costs and expenses whatsoever incurred by such Issuing Bank in
connection with any payment made by such Issuing Bank under, or with
respect to, such Letter of Credit; provided, however, if the Borrower does
not reimburse such Issuing Bank on the Drawdown Date, such amount shall,
provided that no Event of Default under §§12.1(g) or 12.1(h) has occurred,
become automatically a Syndicated Loan which is a Base Rate Loan advanced
hereunder in an amount equal to such sum; and

     (b) upon the Maturity Date or the acceleration of the Reimbursement
Obligations with respect to all Letters of Credit in accordance with §12,
an amount equal to the then Maximum Drawing Amount of all outstanding
Letters of Credit shall be paid by the Borrower to the Administrative
Agent to be held as cash collateral for the applicable Reimbursement
Obligations, and the Borrower hereby grants to the Administrative Agent a
security interest therein.

          §3.3. Obligations Absolute. The Borrower’s obligations under this §3 shall be
absolute and unconditional under any and all circumstances and irrespective of
the occurrence of any Default or Event of Default or any condition precedent
whatsoever or any setoff, counterclaim or defense to payment which the Borrower
may have or have had against any Issuing Bank, any Bank or any beneficiary of a
Letter of Credit, and the Borrower expressly waives any such rights that it may
have with respect thereto. The Borrower further agrees with each Issuing Bank
and the Banks that such Issuing Bank and the Banks (i) shall not be responsible
for, and the Borrower’s Reimbursement Obligations under §3.2 shall not be
affected by, among other things, the validity or genuineness of documents or of
any endorsements thereon, even if such documents should in fact prove to be in
any or all respects invalid, fraudulent or forged (unless due to the willful
misconduct of such Issuing Bank or any other Bank), or any dispute between or
among the Borrower and the beneficiary of any Letter of Credit or any financing
institution or other party to which any Letter of Credit may be transferred or
any claims or defenses whatsoever of the Borrower against the beneficiary of
any Letter of Credit or any such transferee, and (ii) shall not be liable for
any error, omission, interruption or delay in transmission, dispatch or
delivery of any message or advice, however transmitted, in connection with any
Letter of Credit except to the extent of their own willful misconduct. The
Borrower agrees that any action taken or omitted by any Issuing Bank or any
Bank in good faith under or in connection with any Letter of Credit and the
related drafts and documents shall be binding upon the Borrower and shall not
result in

- 28 -

 

any liability on the part of such Issuing Bank or any Bank (or their
respective affiliates) to the Borrower. Nothing herein shall constitute a
waiver by the Borrower of any of its rights against any beneficiary of a Letter
of Credit.

          §3.4. Reliance by the Issuing Banks. To the extent not inconsistent with §3.3,
each Issuing Bank shall be entitled to rely, and shall be fully protected in
relying, upon any Letter of Credit, draft, writing, resolution, notice,
consent, certificate, affidavit, letter, cablegram, telegram, facsimile, telex
or teletype message, statement, order or other document believed by such
Issuing Bank in good faith 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, independent accountants and other experts selected by such
Issuing Bank.

          §3.5. Notice Regarding Letters of Credit. One (1) Business Day prior to the
issuance of any Letter of Credit or any amendment, extension or termination
thereof, the applicable Issuing Bank shall notify the Administrative Agent of
the terms of such Letter of Credit, amendment, extension or termination. In the
case of
any such issuance, amendment or extension, the Administrative Agent will
promptly notify such Issuing Bank whether such issuance, amendment or extension
is permissible under the limitation set forth in the proviso to §2.1(a). On the
day of any drawing under any Letter of Credit, such Issuing Bank shall notify
the Administrative Agent of such drawing, specifying the amount thereof, and on
the day of any payment under any Letter of Credit, such Issuing Bank shall
notify the Administrative Agent of such payment, specifying the amount thereof
and, in the case of a payment under a Canadian Dollar Letter of Credit, the
U.S. Dollar Equivalent thereof.

          §3.6. Letter of Credit Fee; Issuance Fee. The Borrower shall pay a fee (the
“Letter of Credit Fee”) equal to the Applicable L/C Rate on the Maximum Drawing
Amount to the Administrative Agent for the account of the Banks, to be shared
pro rata by the Banks in accordance with their respective Commitment
Percentages. The Letter of Credit Fee shall be payable quarterly in arrears on
the third Business Day of each calendar quarter for the quarter just ended,
with the first such payment being due on January 4, 2005, and on the Maturity
Date. In addition, an issuing fee (the “Issuance Fee”) with respect to each
Letter of Credit to be agreed upon annually between the Borrower and each
Issuing Bank shall be payable by the Borrower to such Issuing Bank for its
account.

§4. COMPETITIVE BID LOANS.

          §4.1. The Competitive Bid Option. In addition to the Syndicated Loans made
pursuant to §2 hereof, the Borrower may request Competitive Bid Loans pursuant
to the terms of this §4. The Banks may, but shall have no obligation to, make
offers for Competitive Bid Loans and the Borrower may, but shall have no
obligation to, accept such offers in the manner set forth in this §4.
Notwithstanding any other provision herein to the contrary, at no time shall
the aggregate principal amount of Competitive Bid Loans outstanding at any time
exceed the Total Commitment minus the sum of (a) the aggregate outstanding
principal amount of Syndicated Loans (including the Swing Loans) plus (b) the
Maximum Drawing Amount of Letters of Credit, outstanding at such time.

          §4.2. Competitive Bid Loan Accounts; Competitive Bid Loans.

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     (a) The obligation of the Borrower to repay the outstanding principal
amount of any and all Competitive Bid Loans, plus interest at the
applicable rate accrued thereon, shall be evidenced by this Agreement and
by individual loan accounts (the “Competitive Bid Loan Accounts” and
individually, a “Competitive Bid Loan Account”) maintained by the
Administrative Agent on its books for each of the Banks, it being the
intention of the parties hereto that, except as provided for in paragraph
(b) of this §4.2, the Borrower’s obligations with respect to Competitive
Bid Loans are to be evidenced only as stated herein and not by separate
promissory notes.

     (b) Any Bank may at any time, and from time to time, request that any
Competitive Bid Loans outstanding to such Bank be evidenced by a
promissory note of the Borrower in the form approved by the Administrative
Agent, dated as of the Effective Date and completed with appropriate
insertions.

     (c) The Borrower irrevocably authorizes the Administrative Agent to
make or cause to be made, in connection with a Drawdown Date of any
Competitive Bid Loan or at the time of receipt of any payment of principal
on the applicable Bank’s Competitive Bid Loan Account, an appropriate
notation on the Administrative Agent’s records, reflecting the making of
the Competitive Bid Loan, or the receipt of such payment (as the case may
be). The outstanding amount of the Competitive Bid Loans set forth on the
Administrative Agent’s records, shall be prima facie evidence of the
principal amount thereof owing and unpaid to such Bank, but the failure to
record, or any error in so recording, any such amount shall not limit or
otherwise affect the obligations of the Borrower hereunder to make
payments of principal of or interest on any Competitive Bid Loan when due.

          §4.3. Competitive Bid Quote Request; Invitation for Competitive Bid Quotes.

     (a) When the Borrower wishes to request offers to make Competitive
Bid Loans under this §4, it shall transmit to the Administrative Agent by
telex or facsimile a Competitive Bid Quote Request substantially in the
form of Exhibit E hereto (a “Competitive Bid Quote Request”) so as to be
received no later than 1:00 p.m. (New York time) (x) five (5) Eurodollar
Business Days prior to the requested Drawdown Date in the case of a
Eurodollar Competitive Bid Loan or (y) one (1) Business Day prior to the
requested Drawdown Date in the case of an Absolute Competitive Bid Loan,
specifying:

          (i) the requested Drawdown Date (which must be a Eurodollar
Business Day in the case of a Eurodollar Competitive Bid Loan or a
Business Day in the case of an Absolute Competitive Bid Loan);

          (ii) the aggregate amount of such Competitive Bid Loans, which
shall be $10,000,000 or larger multiple of $1,000,000;

          (iii) the duration of the Interest Period(s) applicable
thereto, subject to the provisions of the definition of Interest
Period; and

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          (iv) whether the Competitive Bid Quotes requested are for
Eurodollar Competitive Bid Loans or Absolute Competitive Bid Loans.

The Borrower may request offers to make Competitive Bid Loans for more
than one Interest Period in a single Competitive Bid Quote Request. No new
Competitive Bid Quote Request shall be given until the Borrower has
notified the Administrative Agent of its acceptance or non-acceptance of
the Competitive Bid Quotes relating to any outstanding Competitive Bid
Quote Request.

     (b) Promptly upon receipt of a Competitive Bid Quote Request, the
Administrative Agent shall send to the Banks by telecopy or facsimile
transmission an Invitation for Competitive Bid Quotes substantially in the
form of Exhibit F hereto, which shall constitute an invitation by the
Borrower to each Bank to submit Competitive Bid Quotes in accordance with
this §4.

          §4.4. Alternative Manner of Procedure. If, after receipt by the Administrative
Agent and each of the Banks of a Competitive Bid Quote Request from the
Borrower in accordance with §4.3, the Administrative Agent or any Bank shall be
unable to complete any procedure of the auction process described in §§4.5
through 4.6 (inclusive) due to the inability of such Person to transmit or
receive communications through the means specified therein, such Person may
rely on telephonic notice for the transmission or receipt of such
communications. In any case where such Person shall rely on telephone
transmission or receipt, any communication made by telephone shall, as soon as
possible thereafter, be followed by written confirmation thereof.

          §4.5. Submission and Contents of Competitive Bid Quotes.

     (a) Each Bank may, but shall be under no obligation to, submit a
Competitive Bid Quote containing an offer or offers to make Competitive
Bid Loans in response to any Competitive Bid Quote Request. Each
Competitive Bid Quote must comply with the requirements of this §4.5 and
must be submitted to the Administrative Agent by telex or facsimile
transmission at its offices as specified in or pursuant to §22 not later
than (x) 2:00 p.m. (New York time) on the fourth Eurodollar Business Day
prior to the proposed Drawdown Date, in the case of a Eurodollar
Competitive Bid Loan or (y) 10:00 a.m. (New York time) on the proposed
Drawdown Date, in the case of an Absolute Competitive Bid Loan; provided
that Competitive Bid Quotes may be submitted by the Administrative Agent
in its capacity as a Bank only if it submits its Competitive Bid Quote to
the Borrower not later than (x) one hour prior to the deadline for the
other Banks, in the case of a Eurodollar Competitive Bid Loan or (y) 15
minutes prior to the deadline for the other Banks, in the case of an
Absolute Competitive Bid Loan. Subject to the provisions of §§10 and 11
hereof, any Competitive Bid Quote so made shall be irrevocable except with
the written consent of the Administrative Agent given on the instructions
of the Borrower.

     (b) Each Competitive Bid Quote shall be in substantially the form of
Exhibit G hereto and shall in any case specify:

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          (i) the proposed Drawdown Date;

          (ii) the principal amount of the Competitive Bid Loan for
which each proposal is being made, which principal amount (w) may
be greater than or less than the Commitment of the quoting Bank,
(x) must be $5,000,000 or a larger multiple of $1,000,000, (y) may
not exceed the aggregate principal amount of Competitive Bid Loans
for which offers were requested and (z) may be subject to
an aggregate limitation as to the principal amount of
Competitive Bid Loans for which offers being made by such quoting
Bank may be accepted;

          (iii) the Interest Period(s) for which Competitive Bid Quotes
are being submitted;

          (iv) in the case of a Eurodollar Competitive Bid Loan, the
margin above or below the applicable Eurodollar Rate (the
“Competitive Bid Margin”) offered for each such Competitive Bid
Loan, expressed as a percentage (specified to the nearest
1/10,000th of 1%) to be added to or subtracted from such Eurodollar
Rate;

          (v) in the case of an Absolute Competitive Bid Loan, the rate
of interest per annum (specified to the nearest 1/10,000th of 1%)
(the “Competitive Bid Rate”) offered for each such Absolute
Competitive Bid Loan; and

          (vi) the identity of the quoting Bank.

A Competitive Bid Quote may include up to five separate offers by the
quoting Bank with respect to each Interest Period specified in the related
Invitation for Competitive Bid Quotes.

     (c) Any Competitive Bid Quote shall be disregarded if it:

          (i) is not substantially in the form of Exhibit G hereto;

          (ii) contains qualifying, conditional or similar language;

          (iii) proposes terms other than or in addition to those set
forth in the applicable Invitation for Competitive Bid Quotes; or

          (iv) arrives after the time set forth in §4.5(a) hereof.

          §4.6. Notice to Borrower. The Administrative Agent shall promptly notify the
Borrower of the terms (x) of any Competitive Bid Quote submitted by a Bank that
is in accordance with §4.5 and (y) of any Competitive Bid Quote that amends,
modifies or is otherwise inconsistent with a previous Competitive Bid Quote
submitted by such Bank with respect to the same Competitive Bid Quote Request.
Any such subsequent Competitive Bid Quote shall be disregarded by the
Administrative Agent unless such subsequent Competitive Bid Quote is submitted
solely to correct a manifest error in such former Competitive Bid Quote. The
Administrative Agent’s notice to the Borrower shall specify (A) the aggregate
principal amount

- 32 -

 

of Competitive Bid Loans for which offers have been received
for each Interest Period specified in the related Competitive Bid Quote
Request, (B) the respective principal amounts and Competitive Bid Margins or
Competitive Bid Rates, as the case may be, so offered, and the identity of the
respective Banks submitting such offers, and (C) if applicable, limitations on
the aggregate
principal amount of Competitive Bid Loans for which offers in any single
Competitive Bid Quote may be accepted.

          §4.7. Acceptance and Notice by Borrower and Administrative Agent. Not later
than 11:00 a.m. (New York time) on (x) the third Eurodollar Business Day prior
to the proposed Drawdown Date, in the case of a Eurodollar Competitive Bid Loan
or (y) the proposed Drawdown Date, in the case of an Absolute Competitive Bid
Loan, the Borrower shall notify the Administrative Agent of its acceptance or
non-acceptance of each Competitive Bid Quote in substantially the form of
Exhibit H hereto. The Borrower may accept any Competitive Bid Quote in whole or
in part; provided that:

     (i) the aggregate principal amount of each Competitive Bid Loan may
not exceed the applicable amount set forth in the related Competitive Bid
Quote Request;

     (ii) acceptance of offers may only be made on the basis of ascending
Competitive Bid Margins or Competitive Bid Rates, as the case may be, and

     (iii) the Borrower may not accept any offer that is described in
subsection 4.5(c) or that otherwise fails to comply with the requirements
of this Agreement.

The Administrative Agent shall promptly notify each Bank which submitted a
Competitive Bid Quote of the Borrower’s acceptance or non-acceptance thereof.
At the request of any Bank which submitted a Competitive Bid Quote and with the
consent of the Borrower, the Administrative Agent will promptly notify all
Banks which submitted Competitive Bid Quotes of (a) the aggregate principal
amount of, and (b) the range of Competitive Bid Rates or Competitive Bid
Margins of, the accepted Competitive Bid Loans for each requested Interest
Period.

          §4.8. Allocation by Administrative Agent. If offers are made by two or more
Banks with the same Competitive Bid Margin or Competitive Bid Rate, as the case
may be, for a greater aggregate principal amount than the amount in respect of
which offers are accepted for the related Interest Period, the principal amount
of Competitive Bid Loans in respect of which such offers are accepted shall be
allocated by the Administrative Agent among such Banks as nearly as possible
(in such multiples, not less than $1,000,000, as the Administrative Agent may
deem appropriate) in proportion to the aggregate principal amounts of such
offers. Determination by the Administrative Agent of the amounts of Competitive
Bid Loans shall be conclusive in the absence of manifest error.

          §4.9. Funding of Competitive Bid Loans. If, on or prior to the Drawdown Date
of any Competitive Bid Loan, the Total Commitment has not terminated in full
and if, on such Drawdown Date, the applicable conditions of §§10 and 11 hereof
are satisfied, the Bank or Banks whose offers the Borrower has accepted will
fund each Competitive Bid Loan so accepted. Such Bank or Banks will make such
Competitive Bid Loans by crediting the

- 33 -

 

Administrative Agent for further credit
to the Borrower’s specified account with
the Administrative Agent, in immediately available funds not later than 1:00
p.m. (New York time) on such Drawdown Date.

          §4.10. Funding Losses. If, after acceptance of any Competitive Bid Quote
pursuant to §4, the Borrower (i) fails to borrow any Competitive Bid Loan so
accepted on the date specified therefor, or (ii) repays the outstanding amount
of the Competitive Bid Loan prior to the last day of the Interest Period
relating thereto, the Borrower shall indemnify the Bank making such Competitive
Bid Quote or funding such Competitive Bid Loan against any loss or expense
incurred by reason of the liquidation or reemployment of deposits or other
funds acquired by such Bank to fund or maintain such unborrowed Competitive Bid
Loans, including, without limitation compensation as provided in §5.8.

          §4.11. Repayment of Competitive Bid Loans; Interest. The principal of each
Competitive Bid Loan shall become absolutely due and payable by the Borrower on
the last day of the Interest Period relating thereto, and the Borrower hereby
absolutely and unconditionally promises to pay to the Administrative Agent for
the account of the relevant Banks at or before 1:00 p.m. (New York time) on the
last day of the Interest Periods relating thereto the principal amount of all
such Competitive Bid Loans, plus interest thereon at the applicable rates. The
Competitive Bid Loans shall bear interest at the rate per annum specified in
the applicable Competitive Bid Quotes. Interest on the Competitive Bid Loans
shall be payable (a) on the last day of the applicable Interest Periods, and if
any such Interest Period is longer than three months, also on the last day of
the third month following the commencement of such Interest Period, and (b) on
the Maturity Date for all Loans. Subject to the terms of this Agreement, the
Borrower may make Competitive Bid Quote Requests with respect to new Borrowings
of any amounts so repaid prior to the Maturity Date.

§5. PROVISIONS RELATING TO ALL LOANS AND LETTERS OF CREDIT.

          §5.1. Payments.

     (a) All payments of principal, interest, Reimbursement Obligations,
fees (other than the Issuance Fee) and any other amounts due hereunder or
under any of the other Loan Documents shall be made to the Administrative
Agent at the Administrative Agent’s Account in immediately available funds
by 11:00 a.m. (New York time) on any due date. Subject to the provisions
of §29, if a payment is received by the Administrative Agent at or before
1:00 p.m. (New York time) on any Business Day, the Administrative Agent
shall on the same Business Day transfer in immediately available funds, as
applicable, to (1) each of the Banks, their pro rata portion of such
payment in accordance with their respective Commitment Percentages, in the
case of payments with respect to Syndicated Loans and Letters of Credit,
(2) the Swing Line Bank in the case of payments with respect to Swing Line
Loans, and (3) the appropriate Bank(s), in the case of payments with
respect to Competitive Bid Loans. If such payment is received by the
Administrative Agent after 1:00 p.m. (New York time) on
any Business Day, such transfer shall be made by the Administrative
Agent to the applicable Bank(s) on the next Business Day.

- 34 -

 

     (b) All payments by the Borrower and the Guarantor hereunder and
under any of the other Loan Documents shall be made without recoupment,
setoff or counterclaim and free and clear of and without deduction for any
taxes, levies, imposts, duties, charges, fees, deductions, withholdings,
compulsory loans, restrictions or conditions of any nature now or
hereafter imposed or levied by any jurisdiction or any political
subdivision thereof or taxing or other authority therein unless the
Borrower or the Guarantor is compelled by law to make such deduction or
withholding. If any such obligation is imposed upon the Borrower or the
Guarantor with respect to any amount payable by it hereunder or under any
of the other Loan Documents, the Borrower or the Guarantor, as the case
may be, will pay to the Administrative Agent, for the account of the Banks
or (as the case may be) the Administrative Agent, on the date on which
such amount is due and payable hereunder or under such other Loan
Document, such additional amount in Dollars as shall be necessary to
enable the Banks or the Administrative Agent to receive the same net
amount which the Banks or the Administrative Agent would have received on
such due date had no such obligation been imposed upon the Borrower or the
Guarantor. The Borrower and the Guarantor will deliver promptly to the
Administrative Agent certificates or other valid vouchers for all taxes or
other charges deducted from or paid with respect to payments made by it
hereunder or under such other Loan Document.

     (c) Each Bank that is not incorporated or organized under the laws of
the United States of America or a state thereof or the District of
Columbia (a “Non-U.S. Bank”) agrees that, prior to the first date on which
any payment is due to it hereunder, it will deliver to the Borrower and
the Administrative Agent two duly completed copies of United States
Internal Revenue Service Form W-8BEN or W-8ECI or successor applicable
form, as the case may be, certifying in each case that such Non-U.S. Bank
is entitled to receive payments under this Agreement, without deduction or
withholding of any United States federal income taxes. Each Non-U.S. Bank
that so delivers a Form W-8BEN or W-8ECI pursuant to the preceding
sentence further undertakes to deliver to each of the Borrower and the
Administrative Agent two further copies of Form W-8BEN or W-8ECI or
successor applicable form, or other manner of certification, as the case
may be, on or before the date that any such letter or form expires or
becomes obsolete or after the occurrence of any event requiring a change
in the most recent form previously delivered by it to the Borrower, and
such extensions or renewals thereof as may reasonably be requested by the
Borrower, certifying in the case of a Form W-8BEN or W-8ECI that such
Non-U.S. Bank is entitled to receive payments under this Agreement without
deduction or withholding of any United States federal income taxes, unless
in any such case an event (including, without limitation, any change in
treaty, law or regulation) has occurred prior to the date on which any
such delivery would otherwise be required which renders all such forms
inapplicable or which would prevent such Non-U.S. Bank from duly
completing and delivering any such form with respect to it and such
Non-U.S. Bank advises the Borrower that it is not capable of receiving
payments without any deduction or withholding of United States federal
income tax.

     (d) The Borrower shall not be required to pay any additional amounts
to any Non-U.S. Bank in respect of United States Federal withholding tax
pursuant to §17 to the extent that (i) the obligation to withhold amounts
with respect to United States Federal

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withholding tax existed on the date
such Non-U.S. Bank became a party to this Agreement or, with respect to
payments to a different lending office designated by the Non-U.S. Bank as
its applicable lending office (a “New Lending Office”), the date such
Non-U.S. Bank designated such New Lending Office with respect to a Loan;
provided, however, that this clause (i) shall not apply to any transferee
or New Lending Office as a result of an assignment, transfer or
designation made at the request of the Borrower; and provided further,
however, that this clause (i) shall not apply to the extent the indemnity
payment or additional amounts any transferee, or Bank through a New
Lending Office, would be entitled to receive without regard to this clause
(i) do not exceed the indemnity payment or additional amounts that the
Person making the assignment or transfer to such transferee, or Bank
making the designation of such New Lending Office, would have been
entitled to receive in the absence of such assignment, transfer or
designation; or (ii) the obligation to pay such additional amounts would
not have arisen but for a failure by such Non-U.S. Bank to comply with the
provisions of paragraph (b) above.

     (e) Notwithstanding the foregoing, each Bank agrees to use reasonable
efforts (consistent with legal and regulatory restrictions) to change its
lending office to avoid or to minimize any amounts otherwise payable under
§17 in each case solely if such change can be made in a manner so that
such Bank, in its sole determination, suffers no legal, economic or
regulatory disadvantage.

          §5.2. Mandatory Repayments of the Loans. If at any time (including
without limitation by reason of fluctuation in the rate of exchange between the
Canadian Dollar and the U.S. Dollar) the sum of the outstanding principal
amount of the Loans plus the Maximum Drawing Amount of all outstanding Letters
of Credit exceeds the Total Commitment, whether by reduction of the Total
Commitment or otherwise, then the Borrower shall immediately pay the amount of
such excess to the Administrative Agent, (i) for application to the Loans,
first to Syndicated Loans, then to Competitive Bid Loans, subject to §5.8, or
(ii) if no Loans shall be outstanding, to be held by the Administrative Agent
for the benefit of the Banks as collateral security for such excess Maximum
Drawing Amount and the Borrower hereby grants a security interest in such
amount to the Administrative Agent for the benefit of the Banks; provided,
however, that if the amount of cash collateral held by the Administrative Agent
pursuant to this §5.2(a) exceeds the Maximum Drawing Amount required to be
collateralized from time to time, the Administrative Agent shall return such
excess to the Borrower.

          §5.3. Computations. Except as otherwise expressly provided herein, all
computations of interest, Facility Fees, Letter of Credit Fees or other fees
shall be based on a 360-day year and paid for the actual number of days
elapsed, except that computations based on the Base Rate shall be based on a
365 or 366, as applicable, day year and paid for the actual number of days
elapsed. Whenever a payment hereunder or under any of the other Loan Documents
becomes due
on a day that is not a Business Day, the due date for such payment shall
be extended to the next succeeding Business Day, and interest shall accrue
during such extension; provided that for any Interest Period for any Eurodollar
Loan if such next succeeding Business Day falls in the next succeeding calendar
month or after the Maturity Date, it shall be deemed to end on the next
preceding Business Day.

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          §5.4. Illegality; Inability to Determine Eurodollar Rate. Notwithstanding
any other provision of this Agreement (other than §5.10), if (a) the
introduction of, any change in, or any change in the interpretation of, any law
or regulation applicable to any Bank or the Administrative Agent shall make it
unlawful, or any central bank or other governmental authority having
jurisdiction thereof shall assert that it is unlawful, for any Bank or the
Administrative Agent to perform its obligations in respect of any Eurodollar
Loans, or (b) if any Bank or the Administrative Agent, as applicable, shall
reasonably determine with respect to Eurodollar Loans that (i) by reason of
circumstances affecting any Eurodollar interbank market, adequate and
reasonable methods do not exist for ascertaining the Eurodollar Rate which
would otherwise be applicable during any Interest Period, or (ii) deposits of
Dollars in the relevant amount for the relevant Interest Period are not
available to such Bank or the Administrative Agent in any Eurodollar interbank
market, or (iii) the Eurodollar Rate does not or will not accurately reflect
the cost to such Bank or the Administrative Agent of obtaining or maintaining
the Eurodollar Loans during any Interest Period, then such Bank or the
Administrative Agent shall promptly give telephonic, telex or cable notice of
such determination to the Borrower (which notice shall be conclusive and
binding upon the Borrower). Upon such notification by the Bank or the
Administrative Agent, the obligation of the Banks and the Administrative Agent
to make Eurodollar Loans shall be suspended until the Banks or the
Administrative Agent, as the case may be, determine that such circumstances no
longer exist, and to the extent permitted by law the outstanding Eurodollar
Loans shall continue to bear interest at the applicable rate based on the
Eurodollar Rate until the end of the applicable Interest Period, and thereafter
shall be deemed converted to Base Rate Loans in equal principal amounts to such
former Eurodollar Loans.

          §5.5. Additional Costs, Etc. If any present or future applicable law
(which expression, as used herein, includes statutes, rules and regulations
thereunder and interpretations thereof by any competent court or by any
governmental or other regulatory body or official charged with the
administration or the interpretation thereof and requests, directives,
instructions and notices at any time or from time to time hereafter made upon
or otherwise issued to any Bank by any central bank or other fiscal, monetary
or other authority, whether or not having the force of law) shall:

     (a) subject such Bank to any tax, levy, impost, duty, charge, fee,
deduction or withholding of any nature with respect to this Agreement, the
other Loan Documents, such Bank’s Commitment or the Loans (other than
taxes based upon or measured by the income or profits of such Bank imposed
by the jurisdiction of its incorporation or organization, or the location
of its lending office); or

     (b) materially change the basis of taxation (except for changes in
taxes on income or profits of such Bank imposed by the jurisdiction of
its incorporation or organization, or the location of its lending office)
of payments to such Bank of the principal or of the interest on any Loans
or any other amounts payable to such Bank under this Agreement or the
other Loan Documents; or

     (c) except as provided in §5.6 or as otherwise reflected in the Base
Rate, the Eurodollar Rate, or the applicable rate for Competitive Bid
Loans, impose or increase or render applicable (other than to the extent
specifically provided for elsewhere in this

- 37 -

 

Agreement) any special
deposit, reserve, assessment, liquidity, capital adequacy or other
similar requirements (whether or not having the force of law) against
assets held by, or deposits in or for the account of, or loans by, or
commitments of, an office of any Bank with respect to this Agreement, the
other Loan Documents, such Bank’s Commitment or the Loans; or

     (d) impose on such Bank any other conditions or requirements with
respect to this Agreement, the other Loan Documents, the Loans, such
Bank’s Commitment or any class of loans or commitments of which any of
the Loans or such Bank’s Commitment forms a part, and the result of any
of the foregoing is:

          (i) to increase the cost to such Bank of making, funding,
issuing, renewing, extending or maintaining the Loans or such
Bank’s Commitment or issuing or participating in Letters of Credit;

          (ii) to reduce the amount of principal, interest or other
amount payable to such Bank hereunder on account of such Bank’s
Commitment, the Loans or the Reimbursement Obligations; or

          (iii) to require such Bank to make any payment or to forego
any interest or other sum payable hereunder, the amount of which
payment or foregone interest or other sum is calculated by
reference to the gross amount of any sum receivable or deemed
received by such Bank from the Borrower hereunder,

then, and in each such case, the Borrower will, upon demand
made by such Bank at any time and from time to time as often as the
occasion therefor may arise (which demand shall be accompanied by a
statement setting forth the basis of such demand which shall be
conclusive absent manifest error), pay such reasonable additional
amounts as will be sufficient to compensate such Bank for such
additional costs, reduction, payment or foregone interest or other
sum; provided that the determination and allocation of amounts, if
any, claimed by any Bank under this Section 5.5 are made on a
reasonable basis in a manner consistent with such Bank’s treatment
of customers of such Bank that such Bank considers, in its
reasonable discretion, to be similar to the Borrower and having
generally similar provisions in their agreements with such Bank.

          §5.6. Capital Adequacy. If any Bank shall have determined that, after the
date hereof, (a) the
adoption of any applicable law, rule or regulation regarding capital
adequacy, or any change in any such law, rule, or regulation, or any change in
the interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or any request or directive regarding capital adequacy
(whether or not having the force of law) of any such authority, central bank or
comparable agency, or (b) compliance by such Bank or the Administrative Agent
or any corporation controlling such Bank or the Administrative Agent with any
law, governmental rule, regulation, policy, guideline or directive (whether or
not having the force of law) of any such entity regarding capital adequacy, has
or would have the effect of reducing the rate of return on capital of such Bank
(or any corporation controlling such Bank) as a consequence of such Bank’s

- 38 -

 

obligations hereunder to a level below that which such Bank (or any corporation
controlling such Bank) could have achieved but for such adoption, change,
request or directive (taking into consideration its policies with respect to
capital adequacy) by an amount deemed by such Bank to be material, then from
time to time, within 15 days after demand by such Bank, the Borrower shall pay
to such Bank such additional amount or amounts as will, in such Bank’s
reasonable determination, fairly compensate such Bank (or any corporation
controlling such Bank) for such reduction. Each Bank shall allocate such cost
increases among its customers in good faith and on an equitable basis.

          §5.7. Certificate. A certificate setting forth the additional amounts
payable pursuant to §5.5 or §5.6 and a reasonable explanation of such amounts
which are due, submitted by any Bank to the Borrower, shall be conclusive,
absent manifest error, that such amounts are due and owing; provided that no
Bank shall be entitled to additional amounts with respect to events or
circumstances occurring more than one hundred and twenty (120) days prior to
the delivery of such certificate.

          §5.8. Eurodollar and Competitive Bid Indemnity. The Borrower agrees to
indemnify the Banks and the Administrative Agent and to hold them harmless from
and against any reasonable loss, cost or expense that any such Bank and the
Administrative Agent may sustain or incur as a consequence of (a) the default
by the Borrower in payment of the principal amount of or any interest on any
Eurodollar Loans or Competitive Bid Loans as and when due and payable,
including any such loss or expense arising from interest or fees payable by any
Bank or the Administrative Agent to lenders of funds obtained by it in order to
maintain its Eurodollar Loans or Competitive Bid Loans, (b) the default by the
Borrower in making a Borrowing of a Eurodollar Loan or Competitive Bid Loan or
conversion of a Eurodollar Loan or a prepayment of a Eurodollar or Competitive
Bid Loan after the Borrower has given (or is deemed to have given) a Syndicated
Loan Request, a notice pursuant to §2.7 or a Notice of Acceptance/Rejection of
Competitive Bid Quote(s), or a notice pursuant to §2.10, and (c) the making of
any payment of a Eurodollar Loan or Competitive Bid Loan, or the making of any
conversion of any Eurodollar Loan to a Base Rate Loan on a day that is not the
last day of the applicable Interest Period with respect thereto. Such loss,
cost, or reasonable expense shall include an amount equal to the excess, if
any, as reasonably determined by each Bank of (i) its cost of obtaining the
funds for (A) the Eurodollar Loan being paid, prepaid, converted, not
converted, reallocated, or not borrowed, as the case may be (based on the
Eurodollar Rate), or (B) the Competitive Bid Loan being paid, prepaid, or
not borrowed, as the case may be (based on the applicable interest rate)
for the period from the date of such payment, prepayment, conversion, or
failure to borrow or convert, as the case may be, to the last day of the
Interest Period for such Loan (or, in the case of a failure to borrow, the
Interest Period for the Loan which would have commenced on the date of such
failure to borrow) over (ii) the amount of interest (as reasonably determined
by such Bank) that would be realized by such Bank in reemploying the funds so
paid, prepaid, converted, or not borrowed, converted, or prepaid for such
period or Interest Period, as the case may be, which determinations shall be
conclusive absent manifest error.

          §5.9. Interest on Overdue Amounts. Overdue principal and (to the extent
permitted by applicable law) interest on the Loans and all other overdue
amounts payable hereunder or under any of the other Loan Documents shall bear
interest compounded monthly

- 39 -

 

and payable on demand at a rate per annum equal to
the Applicable Base Rate plus 2% per annum, until such amount shall be paid in
full (after as well as before judgment).

          §5.10. Interest Limitation. Notwithstanding any other term of this
Agreement, any other Loan Document or any other document referred to herein or
therein, the maximum amount of interest which may be charged to or collected
from any Person liable hereunder by any Bank shall be absolutely limited to,
and shall in no event exceed, the maximum amount of interest which could
lawfully be charged or collected by such Bank under applicable laws (including,
to the extent applicable, the provisions of §5197 of the Revised Statutes of
the United States of America, as amended, and 12 U.S.C. §85, as amended, and
without prejudice to the first sentence of §26 hereof).

          §5.11. Reasonable Efforts to Mitigate. Each Bank agrees that as promptly
as practicable after it becomes aware of the occurrence of an event or the
existence of a condition that would cause it to be affected under §§5.4, 5.5 or
5.6, such Bank will give notice thereof to the Borrower, with a copy to the
Administrative Agent and, to the extent so requested by the Borrower and not
inconsistent with such Bank’s internal policies, such Bank shall use reasonable
efforts and take such actions as are reasonably appropriate if as a result
thereof the additional moneys which would otherwise be required to be paid to
such Bank pursuant to such sections would be materially reduced, or the
illegality or other adverse circumstances which would otherwise require a
conversion of such Loans or result in the inability to make such Loans pursuant
to such sections would cease to exist, and in each case if, as determined by
such Bank in its sole discretion, the taking of such actions would not
adversely affect such Loans or such Bank or otherwise be disadvantageous to
such Bank.

          §5.12. Replacement of Banks. If any Bank (an “Affected Bank”) (1) makes
demand upon the Borrower for (or if the Borrower is otherwise required to pay)
amounts pursuant to §§5.5 or 5.6, (ii) is unable to make or maintain Eurodollar
Loans as a result of a condition described in §5.4 or (iii)
defaults in its obligation to make Loans or to participate in Letters of
Credit in accordance with the terms of this Agreement (such Bank being referred
to as a “Defaulting Bank”), the Borrower may, within 90 days of receipt of such
demand, notice (or the occurrence of such other event causing the Borrower to
be required to pay such compensation or causing §5.4 to be applicable), or
default, as the case may be, by notice (a “Replacement Notice”) in writing to
the Administrative Agent and such Affected Bank (A) request the Affected Bank
to cooperate with the Borrower in obtaining a replacement bank satisfactory to
the Administrative Agent and the Borrower (the “Replacement Bank”) as provided
herein, but none of such Banks shall be under an obligation to find a
Replacement Bank; (B) request the non-Affected Banks to acquire and assume all
of the Affected Bank’s Loans and Commitment, and to participate in Letters of
Credit as provided herein, but none of such Banks shall be under an obligation
to do so; or (C) designate a Replacement Bank reasonably satisfactory to the
Administrative Agent. If any satisfactory Replacement Bank shall be obtained,
and/or any of the non-Affected Banks shall agree to acquire and assume all of
the Affected Bank’s Loans and Commitment, and to participate in Letters of
Credit, then such Affected Bank shall, so long as no Event of Default shall
have occurred and be continuing, assign, in accordance with §20, all of its
Commitment, Loans, and other rights and obligations under this Agreement and
all other Loan Documents to such Replacement Bank or non-Affected Banks, as the
case may be, in

- 40 -

 

exchange for payment of the principal amount so assigned and
all interest and fees accrued on the amount so assigned, plus all other
Obligations then due and payable to the Affected Bank; provided, however, that
(x) such assignment shall be without recourse, representation or warranty and
shall be on terms and conditions reasonably satisfactory to such Affected Bank
and such Replacement Bank and/or non-Affected Banks, as the case may be, and
(y) prior to any such assignment, the Borrower shall have paid to such Affected
Bank all amounts properly demanded and unreimbursed under §§5.5, 5.6 and 5.8.
Upon the effective date of such assignment, such Replacement Bank shall become
a “Bank” for all purposes under this Agreement and the other Loan Documents.

          §5.13. Advances by Administrative Agent. Unless the Administrative Agent
shall have been notified in writing by any Bank prior to a borrowing hereunder
that such Bank will not make the amount that would constitute its allocable
share of such borrowing available to the Administrative Agent, the
Administrative Agent may assume that such Bank is making such amount available
to the Administrative Agent, and the Administrative Agent may, in reliance upon
such assumption, make available to the Borrower a corresponding amount. If
such amount is not made available to the Administrative Agent by the required
time on the borrowing date therefor, such Bank shall pay to the Administrative
Agent, on demand, such amount with interest thereon at a rate equal to the
daily average Federal Funds Rate for the period until such Bank makes such
amount immediately available to the Administrative Agent. A certificate of the
Administrative Agent submitted to any Bank with respect to any amounts owing
under this Section shall be conclusive in the absence of manifest error. If
such Bank’s Commitment Percentage of such borrowing is not made available to
the Administrative Agent by such Bank within three Business Days of such
borrowing date, the Administrative Agent shall be entitled to recover such
amount with interest thereon at the rate per annum applicable to such Loan
hereunder, on demand, from the Borrower.

§6. REPRESENTATIONS AND WARRANTIES. The Borrower (and the Guarantor, where
applicable) represents and warrants to the Banks that:

          §6.1. Corporate Authority.

     (a) Incorporation; Good Standing. The Borrower and each of its
Significant Subsidiaries (i) is duly organized, validly existing and in
good standing under the laws of its respective jurisdiction of formation,
(ii) has all requisite corporate power to own its property and conduct its
business as now conducted and as presently contemplated, and (iii) is in
good standing and is duly authorized to do business in each jurisdiction
in which its property or business as presently conducted or contemplated
makes such qualification necessary, except where a failure to be so
qualified could not reasonably be expected to have a Material Adverse
Effect.

     (b) Authorization. The execution, delivery and performance of its
Loan Documents and the transactions contemplated hereby and thereby (i)
are within the corporate authority of the Borrower and the Guarantor,
(ii) have been duly authorized by all necessary corporate proceedings on
the part of each of the Borrower and the Guarantor, (iii) do not conflict
with or result in any breach or contravention of any provision of law,
statute, rule or regulation to which any of the Borrower or the

- 41 -

 

     Guarantor
or any of their Subsidiaries is subject, (iv) do not contravene any
judgment, order, writ, injunction, license or permit applicable to the
Borrower, the Guarantor or any of their Subsidiaries so as to have a
Material Adverse Effect, and (v) do not conflict with any provision of
the corporate charter or bylaws of the Borrower, the Guarantor or any
Significant Subsidiary or any agreement or other instrument binding upon
the Borrower, the Guarantor or any of their Significant Subsidiaries,
except for those conflicts with any such agreement or instrument which
could not reasonably be expected to have a Material Adverse Effect.

     (c) Enforceability. The execution, delivery and performance of the
Loan Documents by the Borrower and the Guarantor will result in valid and
legally binding obligations of the Borrower and the Guarantor enforceable
against them in accordance with the respective terms and provisions
hereof and thereof, except as enforceability is limited by bankruptcy,
insolvency, reorganization, moratorium or other laws relating to or
affecting generally the enforcement of creditors’ rights generally and
general principles of equity.

          §6.2. Governmental and Other Approvals. The execution, delivery and
performance of the Loan Documents by the Borrower and the Guarantor and the
consummation by the Borrower and the Guarantor of the transactions contemplated
hereby and thereby do not require any approval or consent of, or filing with,
any governmental agency or authority or other third party other than those
already obtained and those required after the date hereof in connection with
the Borrower’s performance of the covenants contained in §§7, 8 and 9 hereof.

          §6.3. Title to Properties; Leases. The Borrower and its Subsidiaries own all of the assets reflected in
the consolidated balance sheet as at the Interim Balance Sheet Date or acquired
since that date (except property and assets operated under Capital Leases or
sold or otherwise disposed of in the ordinary course of business since that
date), subject to no Liens except Permitted Liens.

     §6.4. Financial Statements; Solvency.

     (a) There have been furnished to the Banks consolidated balance
sheets of the Borrower dated the Balance Sheet Date and consolidated
statements of operations for the fiscal periods then ended, certified by
the Accountants. In addition, there have been furnished to the Banks
consolidated balance sheets of the Borrower and its Subsidiaries dated the
Interim Balance Sheet Date and the related consolidated statements of
operations for the fiscal quarter ending on the Interim Balance Sheet
Date. All said balance sheets and statements of operations have been
prepared in accordance with GAAP (but, in the case of any of such
financial statements which are unaudited, only to the extent GAAP is
applicable to interim unaudited reports), and fairly present, in all
material respects, the financial condition of the Borrower on a
consolidated basis as at the close of business on the dates thereof and
the results of operations for the periods then ended, subject, in the case
of unaudited interim financial statements, to changes resulting from audit
and normal year-end adjustments and to the absence of complete footnotes.
There are no contingent liabilities of the Borrower and its Subsidiaries
involving material

- 42 -

 

amounts, known to the officers of the Borrower or the
Guarantor, which have not been disclosed in said balance sheets and the
related notes thereto or otherwise in writing to the Banks.

     (b) The Borrower on a consolidated basis (both before and after
giving effect to the transactions contemplated by this Agreement) is
solvent (i.e., it has assets having a fair value in excess of the amount
required to pay its probable liabilities on its existing debts as they
become absolute and matured) and has, and expects to have, the ability to
pay its debts from time to time incurred in connection therewith as such
debts mature.

          §6.5. No Material Changes, Etc. Since the Balance Sheet Date, there have been
no material adverse changes in the consolidated financial condition, business,
assets or liabilities (contingent or otherwise) of the Borrower and its
Subsidiaries, taken as a whole, other than changes in the ordinary course of
business which have not had a Material Adverse Effect.

          §6.6. Franchises, Patents, Copyrights, Etc. The Borrower and each of its
Subsidiaries possess all franchises, patents, copyrights, trademarks, trade
names, licenses and permits, and rights in respect of the foregoing, adequate
for the conduct of their business substantially as now conducted (other than
those the absence of which would not have a Material Adverse Effect) without
known conflict with any rights of others other than a conflict which would not
have a Material Adverse Effect.

          §6.7. Litigation. Except as set forth on Schedule 6.7 or in the Disclosure Documents,
there are no actions, suits, proceedings or investigations of any kind pending
or, to the knowledge of the Borrower, threatened against the Borrower or any of
its Subsidiaries before any court, tribunal or administrative agency or board
which, either in any case or in the aggregate, could reasonably be expected to
have a Material Adverse Effect.

          §6.8. No Materially Adverse Contracts, Etc. Neither the Borrower nor any of
its Subsidiaries is subject to any charter, corporate or other legal
restriction, or any judgment, decree, order, rule or regulation which in the
judgment of the Borrower’s or such Subsidiary’s officers has or could
reasonably be expected in the future to have a Material Adverse Effect. Neither
the Borrower nor any of its Subsidiaries is a party to any contract or
agreement which in the judgment of the Borrower’s or its Subsidiary’s officers
has or could reasonably be expected to have any Material Adverse Effect, except
as otherwise reflected in adequate reserves as required by GAAP.

          §6.9. Compliance With Other Instruments, Laws, Etc. Neither the Borrower
nor any of its Subsidiaries is (a) violating any provision of its charter
documents or bylaws or (b) violating any agreement or instrument to which any
of them may be subject or by which any of them or any of their properties may
be bound or any decree, order, judgment, or any statute, license, rule or
regulation, in a manner which could (in the case of such agreements or such
instruments) reasonably be expected to result in a Material Adverse Effect.

- 43 -

 

          §6.10. Tax Status. The Borrower and its Subsidiaries have filed all
federal, state, provincial and territorial income and all other tax returns,
reports and declarations (or obtained extensions with respect thereto) required
by applicable law to be filed by them (unless and only to the extent that the
Borrower or such Subsidiary has set aside on its books provisions reasonably
adequate for the payment of all unpaid and unreported taxes as required by
GAAP); and have paid all taxes and other governmental assessments and charges
(other than taxes, assessments and other governmental charges imposed by
jurisdictions other than the United States, Canada or any political subdivision
thereof which in the aggregate are not material to the financial condition,
business or assets of the Borrower or such Subsidiary on an individual basis or
of the Borrower on a consolidated basis) that are material in amount, shown or
determined to be due on such returns, reports and declarations, except those
being contested in good faith; and, as required by GAAP, have set aside on
their books provisions reasonably adequate for the payment of all taxes for
periods subsequent to the periods to which such returns, reports or
declarations apply. Except to the extent contested in the manner permitted in
the preceding sentence, there are no unpaid taxes in any material amount
claimed by the taxing authority of any jurisdiction to be due and owing by the
Borrower or any Subsidiary, nor do the officers of the Borrower or any of its
Subsidiaries know of any basis for any such claim.

          §6.11. No Event of Default. No Default or Event of Default has occurred
hereunder and is continuing.

          §6.12. Holding Company and Investment Company Acts. Neither the Borrower
nor any of its Subsidiaries is a “holding company”, or a “subsidiary company”
of a “holding company”, or an “affiliate” of a “holding company”, as such terms
are defined in the Public Utility Holding Company Act of 1935; nor is any of
them a “registered investment company”, or an “affiliated company” or a
“principal underwriter” of a “registered investment company”, as such terms are
defined in the Investment Company Act of 1940.

          §6.13. Absence of Financing Statements, Etc. Except as permitted by §8.1
of this Agreement, there is no Indebtedness senior to the Obligations, and
except for Permitted Liens, there are no Liens, or any effective financing
statement, security agreement, chattel mortgage, real estate mortgage or other
document filed or recorded with any filing records, registry, or other public
office, which purports to cover, affect or give notice of any present or
possible future Lien on any assets or property of the Borrower or any of its
Subsidiaries or right thereunder.

          §6.14. Employee Benefit Plans.

          §6.14.1. In General. Each Employee Benefit Plan has been maintained and
operated in compliance with the provisions of ERISA and, to the extent
applicable, the Code, including but not limited to the provisions
thereunder respecting prohibited transactions. Promptly upon the request
of any Bank or the Administrative Agent, the Borrower will furnish to the
Administrative Agent the most recently completed annual report, Form
5500, with all required attachments, and actuarial statement required to
be submitted under §103(d) of ERISA, with respect to each Guaranteed
Pension Plan.

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               §6.14.2. Terminability of Welfare Plans. Under each Employee Benefit
Plan which is an employee welfare benefit plan within the meaning of
§3(1) or §3(2)(B) of ERISA, no benefits are due unless the event giving
rise to the benefit entitlement occurs prior to plan termination (except
as required by Title 1, Part 6 of ERISA) . The Borrower or an ERISA
Affiliate, as appropriate, may terminate each such Plan at any time (or
at any time subsequent to the expiration of any applicable bargaining
agreement) in the discretion of the Borrower or such ERISA Affiliate
without material liability to any Person.

               §6.14.3. Guaranteed Pension Plans. Each contribution required to be made
to a Guaranteed Pension Plan, whether required to be made to avoid the
incurrence of an accumulated funding deficiency, the notice or lien
provisions of §302(f) of ERISA, or otherwise, has been timely made. No
waiver of an accumulated funding deficiency or extension of amortization
periods has been received with respect to any Guaranteed Pension Plan. No
liability to the PBGC (other than required insurance premiums, all of
which have been paid) has been incurred by the Borrower or any ERISA Affiliate with respect to any Guaranteed Pension
Plan (other than Terminated Plans) and there has not been any ERISA
Reportable Event, or any other event or condition which presents a
material risk of termination of any Guaranteed Pension Plan by the PBGC.
Other than with respect to the Terminated Plans, based on the latest
valuation of each Guaranteed Pension Plan (which in each case occurred
within twelve months of the date of this representation), and on the
actuarial methods and assumptions employed for that valuation, the
aggregate benefit liabilities of all such Guaranteed Pension Plans within
the meaning of §4001 of ERISA did not exceed the aggregate value of the
assets of all such Guaranteed Pension Plans, disregarding for this
purpose the benefit liabilities and assets of any Guaranteed Pension Plan
with assets in excess of benefit liabilities.

               §6.14.4. Multiemployer Plans. Neither the Borrower nor any ERISA
Affiliate has incurred any material liability (including secondary
liability) to any Multiemployer Plan as a result of a complete or partial
withdrawal from such Multiemployer Plan under §4201 of ERISA or as a
result of a sale of assets described in §4204 of ERISA. Neither the
Borrower nor any ERISA Affiliate has been notified that any Multiemployer
Plan is in reorganization or insolvent under and within the meaning of
§4241 or §4245 of ERISA or that any Multiemployer Plan intends to
terminate or has been terminated under §4041A of ERISA.

          §6.15. Environmental Compliance. The Borrower and its Subsidiaries have taken
all steps that they have deemed reasonably necessary to investigate the past
and present condition and usage of the Real Property and the operations
conducted by the Borrower and its Subsidiaries and, based upon such diligent
investigation, have determined that, except as set forth on Schedule 6.15 or in
the Disclosure Documents:

          (a) Neither the Borrower, its Significant Subsidiaries, nor any
operator of their properties, is in violation, or alleged violation, of
any judgment, decree, order, law, permit, license, rule or regulation
pertaining to environmental matters, including without limitation, those
arising under the Resource Conservation and Recovery Act (“RCRA”),

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the
Comprehensive Environmental Response, Compensation and Liability Act of
1980 as amended (“CERCLA”), the Superfund Amendments and Reauthorization
Act of 1986 (“SARA”), the Federal Clean Water Act, the Federal Clean Air
Act, the Toxic Substances Control Act, or any applicable international,
federal, state, provincial, territorial or local statute, regulation,
ordinance, order or decree relating to health, safety, waste
transportation or disposal, or the environment (the “Environmental Laws”),
which violation, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.

          (b) Except with respect to any such matters that could not
reasonably be expected to have a Material Adverse Effect, neither the
Borrower nor any of its Significant Subsidiaries has received notice from
any third party including, without limitation: any federal, state,
provincial, territorial or local governmental authority, (i)
that any one of them has been identified by the United States
Environmental Protection Agency (“EPA”) as a potentially responsible
party under CERCLA with respect to a site listed on the National
Priorities List, 40 C.F.R. Part 300 Appendix B; (ii) that any hazardous
waste, as defined by 42 U.S.C. §6903(5), any hazardous substances as
defined by 42 U.S.C. §9601(14), any pollutant or contaminant as defined
by 42 U.S.C. §9601(33) or any toxic substance, oil or hazardous materials
or other chemicals or substances regulated by any Environmental Laws,
excluding household hazardous waste (“Hazardous Substances”), which any
one of them has generated, transported or disposed of, has been found at
any site at which a federal, state, provincial, territorial or local
agency or other third party has conducted or has ordered that the
Borrower or any of its Significant Subsidiaries conduct a remedial
investigation, removal or other response action pursuant to any
Environmental Law; or (iii) that it is or shall be a named party to any
claim, action, cause of action, complaint, legal or administrative
proceeding arising out of any third party’s incurrence of costs,
expenses, losses or damages of any kind whatsoever in connection with the
Release of Hazardous Substances.

          (c) Except for those occurrences or situations that could not
reasonably be expected to have a Material Adverse Effect, (i) no portion
of the Real Property or other assets of the Borrower and its Significant
Subsidiaries has been used for the handling, processing, storage or
disposal of Hazardous Substances except in accordance with applicable
Environmental Laws; (ii) in the course of any activities conducted by the
Borrower, its Significant Subsidiaries, or operators of the Real Property
or other assets of the Borrower and its Significant Subsidiaries, no
Hazardous Substances have been generated or are being used on such
properties except in accordance with applicable Environmental Laws; (iii)
there have been no unpermitted Releases or threatened Releases of
Hazardous Substances on, upon, into or from the Real Property or other
assets of the Borrower or its Significant Subsidiaries; and (iv) any
Hazardous Substances that have been generated on the Real Property or
other assets of the Borrower or its Significant Subsidiaries have been
transported offsite only by carriers having an identification number
issued by the EPA, treated or disposed of only by treatment or disposal
facilities maintaining valid permits as required under applicable
Environmental Laws, which transporters and facilities have been and are,
to the Borrower’s knowledge, operating in compliance with such permits
and applicable Environmental Laws.

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          §6.16. Disclosure. No representation or warranty made by the Borrower or
the Guarantor in this Agreement or in any agreement, instrument, document,
certificate, or financial statement furnished to the Banks or the
Administrative Agent by or on behalf of or at the request of the Borrower and
the Guarantor in connection with any of the transactions contemplated by the
Loan Documents contains any untrue statement of a material fact or omits to
state a material fact necessary in order to make the statements contained
therein, taken as a whole, not misleading in light of the circumstances in
which they are made.

          §6.17. Permits and Governmental Authority. All permits (other than those the absence of which could not reasonably
be expected to have a Material Adverse Effect) required for the construction
and operation of all landfills currently owned or operated by the Borrower or
any of its Significant Subsidiaries have been obtained and remain in full force
and effect and are not subject to any appeals or further proceedings or to any
unsatisfied conditions that may allow material modification or revocation.
Neither the Borrower nor any of its Subsidiaries, nor, to the knowledge of the
Borrower, the holder of such permits is in violation of any such permits,
except for any violation which could not reasonably be expected to have a
Material Adverse Effect.

§7. AFFIRMATIVE COVENANTS OF THE BORROWER. The Borrower agrees that, so
long as any Obligation or Letter of Credit is outstanding or the Banks have any
obligation to make Loans or any Issuing Bank has any obligation to issue,
extend or renew any Letter of Credit hereunder, or the Banks have any
obligations to reimburse any Issuing Bank for drawings honored under any Letter
of Credit, it shall, and shall cause its Subsidiaries to, comply with the
following covenants:

          §7.1. Punctual Payment. The Borrower will duly and punctually pay or
cause to be paid the principal of and interest on the Loans, all Reimbursement
Obligations, fees and other amounts provided for in this Agreement and the
other Loan Documents, all in accordance with the terms of this Agreement and
such other Loan Documents.

          §7.2. Maintenance of U.S. Office. The Borrower will maintain its chief
executive offices at Houston, Texas, or at such other place in the United
States of America as the Borrower shall designate upon 30 days’ prior written
notice to the Administrative Agent.

          §7.3. Records and Accounts. The Borrower will, and will cause each of its
Subsidiaries to, keep true and accurate records and books of account in which
full, true and correct entries will be made in accordance with GAAP and with
the requirements of all regulatory authorities and maintain adequate accounts
and reserves for all taxes (including income taxes), depreciation, depletion,
obsolescence and amortization of its properties, all other contingencies, and
all other proper reserves.

          §7.4. Financial Statements, Certificates and Information. The Borrower
will deliver to the Banks:

          (a) as soon as practicable, but, in any event not later than 100 days
after the end of each fiscal year of the Borrower, the consolidated
balance sheet of the Borrower as at the end of such year, consolidated
statements of cash flows, and the related

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consolidated statements of
operations, each setting forth in comparative form the figures for the
previous fiscal year, all such consolidated financial statements to be in
reasonable detail, prepared in accordance with GAAP and, with respect to the
consolidated financial statements, certified by Ernst & Young LLP or by
other nationally recognized independent auditors selected by the Borrower
and reasonably satisfactory to the Administrative Agent (the
“Accountants”). In addition, simultaneously therewith, the Borrower shall
provide the Banks with a written statement from such Accountants to the
effect that they have read a copy of this Agreement, and that, in making
the examination necessary to said certification, they have obtained no
knowledge of any Default or Event of Default, or, if such Accountants
shall have obtained knowledge of any then existing Default or Event of
Default they shall disclose in such statement any such Default or Event of
Default;

     (b) as soon as practicable, but in any event not later than 60 days
after the end of each of the first three fiscal quarters of each fiscal
year of the Borrower, copies of the consolidated balance sheet and
statement of operations of the Borrower as at the end of such quarter,
subject to year-end adjustments, and the related consolidated statement
of cash flows, all in reasonable detail and prepared in accordance with
GAAP (to the extent GAAP is applicable to interim unaudited financial
statements) with a certification by the principal financial or accounting
officer of the Borrower (the “CFO or the CAO”) that the consolidated
financial statements are prepared in accordance with GAAP (to the extent
GAAP is applicable to interim unaudited financial statements) and fairly
present, in all material respects, the consolidated financial condition
of the Borrower as at the close of business on the date thereof and the
results of operations for the period then ended, subject to year-end
adjustments and the exclusion of detailed footnotes;

     (c) simultaneously with the delivery of the financial statements
referred to in (a) and (b) above, a certificate in the form of Exhibit C
hereto (the “Compliance Certificate”) signed by the CFO or the CAO or the
Borrower’s corporate treasurer, stating that the Borrower and its
Subsidiaries are in compliance with the covenants contained in §§7, 8 and
9 hereof as of the end of the applicable period and setting forth in
reasonable detail computations evidencing such compliance with respect to
the covenants contained in §9 hereof and that no Default or Event of
Default exists, provided that if the Borrower shall at the time of
issuance of such Compliance Certificate or at any other time obtain
knowledge of any Default or Event of Default, the Borrower shall include
in such certificate or otherwise deliver forthwith to the Banks a
certificate specifying the nature and period of existence thereof and
what action the Borrower proposes to take with respect thereto;

     (d) promptly following the filing or mailing thereof, copies of all
material of a financial nature filed with the Securities and Exchange
Commission or sent to the Borrower’s and its Subsidiaries’ stockholders
generally; and

     (e) from time to time such other financial data and other
information as any of the Banks may reasonably request through the
Administrative Agent.

The Borrower hereby authorizes each Bank to disclose any information
obtained pursuant

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to this Agreement to all appropriate governmental regulatory
authorities where required by law; provided, however, this authorization shall
not be deemed to be a waiver of any rights to object to the disclosure by the Banks of any such information which the Borrower
has or may have under the federal Right to Financial Privacy Act of 1978, as in
effect from time to time, except as to matters specifically permitted therein.

          §7.5. Existence and Conduct of Business. The Borrower will, and will
cause each Significant Subsidiary to, do or cause to be done all things
necessary to preserve and keep in full force and effect its existence, rights
and franchises; and effect and maintain its foreign qualifications (except
where the failure of the Borrower or any Significant Subsidiary to remain so
qualified could not reasonably be expected to have a Material Adverse Effect),
licensing, domestication or authorization, except as any of the foregoing may
be terminated by its Board of Directors in the exercise of its reasonable
judgment; provided that such termination could not reasonably be expected to
have a Material Adverse Effect. The Borrower will not, and will cause its
Subsidiaries not to, become obligated under any contract or binding arrangement
which, at the time it was entered into, could reasonably be expected to have a
Material Adverse Effect. The Borrower will, and will cause each Subsidiary to,
continue to engage primarily in any of the businesses now conducted by the
Borrower and its Subsidiaries and in related, complementary or supplemental
businesses, and any additional businesses acquired pursuant to the terms of
§8.4(a) hereunder.

          §7.6. Maintenance of Properties. The Borrower will, and will cause its
Significant Subsidiaries to, cause all material properties used or useful in
the conduct of their businesses to be maintained and kept in good condition,
repair and working order (ordinary wear and tear excepted) and supplied with
all necessary equipment and cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment of
the Borrower and its Significant Subsidiaries may be necessary so that the
businesses carried on in connection therewith may be properly and
advantageously conducted at all times; provided, however, that nothing in this
section shall prevent the Borrower or any of its Subsidiaries from
discontinuing the operation and maintenance of any of its properties if such
discontinuance is, in the judgment of the Borrower or such Subsidiary,
desirable in the conduct of its or their business and which could not
reasonably be expected to have a Material Adverse Effect.

          §7.7. Insurance. The Borrower will, and will cause its Subsidiaries to,
maintain insurance of the kinds, covering the risks (other than risks arising
out of or in any way connected with personal liability of any officers and
directors thereof) and in the relative proportionate amounts usually carried by
reasonable and prudent companies conducting businesses similar to that of the
Borrower and its Subsidiaries, in amounts substantially similar to the existing
coverage maintained by the Borrower and its Subsidiaries. Such insurance shall
be with financially sound and reputable insurance companies (including captive
insurance companies), funds or underwriters, or may be pursuant to
self-insurance plans. In addition, the Borrower will furnish from time to
time, upon the Administrative Agent’s request, a summary of the insurance
coverage of the Borrower and its Subsidiaries, which summary shall be in form
and substance satisfactory to the Administrative Agent and, if requested by the
Administrative Agent, will furnish to the Administrative Agent copies of the applicable policies.

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          §7.8. Taxes. The Borrower will, and will cause its Subsidiaries to, duly
pay and discharge, or cause to be paid and discharged, before the same shall
become overdue, all taxes, assessments and other governmental charges imposed
upon it and its real properties, sales and activities, or any part thereof, or
upon the income or profits therefrom, as well as all claims for labor,
materials, or supplies, which if unpaid might by law become a Lien upon any of
its property; provided, however, that any such tax, assessment, charge, levy or
claim need not be paid if the failure to do so (either individually, or in the
aggregate for all such failures) could not reasonably be expected to have a
Material Adverse Effect and the validity or amount thereof shall currently be
contested in good faith by appropriate proceedings and if the Borrower or such
Subsidiary shall have set aside on its books adequate reserves with respect
thereto as required by GAAP; and provided, further, that the Borrower or such
Subsidiary will pay all such taxes, assessments, charges, levies or claims
prior to the foreclosure on any Lien which may have attached as security
therefor.

          §7.9. Inspection of Properties, Books and Contracts. The Borrower will,
and will cause its Significant Subsidiaries to, permit the Administrative Agent
or any Bank or any of their designated representatives, upon reasonable notice,
to visit and inspect any of the properties of the Borrower and its Significant
Subsidiaries, to examine the books of account of the Borrower and its
Significant Subsidiaries, or contracts (and to make copies thereof and extracts
therefrom), and to discuss the affairs, finances and accounts of the Borrower
and its Significant Subsidiaries with, and to be advised as to the same by,
their officers, all at such times and intervals as may be reasonably requested.

          §7.10. Compliance with Laws, Contracts, Licenses and Permits; Maintenance
of Material Licenses and Permits. The Borrower will, and will cause each
Subsidiary to, (i) comply with the provisions of its charter documents and
by-laws; (ii) comply with all agreements and instruments by which it or any of
its properties may be bound except where noncompliance could not reasonably be
expected to have a Material Adverse Effect; (iii) comply with all applicable
laws and regulations (including Environmental Laws), decrees, orders,
judgments, licenses and permits, including, without limitation, all
environmental permits (“Applicable Requirements”), except where noncompliance
with such Applicable Requirements could not reasonably be expected to have a
Material Adverse Effect; (iv) maintain all operating permits for all landfills
now owned or hereafter acquired, except where the failure to do so could not
reasonably be expected to have a Material Adverse Effect; and (v) dispose of
hazardous waste only at licensed disposal facilities operating, to the
Borrower’s knowledge, in compliance with Environmental Laws, except where the
failure to do so could not reasonably be expected to have a Material Adverse
Effect. If at any time any authorization, consent, approval, permit or license
from any officer, agency or instrumentality of any government shall become
necessary or required in order that the Borrower or any Significant Subsidiary
may fulfill any of its obligations hereunder or under any other Loan Document,
the Borrower will immediately take or cause to be taken all reasonable steps within the power of the Borrower or such Significant
Subsidiary to obtain such authorization, consent, approval, permit or license
and furnish the Banks with evidence thereof.

          §7.11. Environmental Indemnification. The Borrower covenants and agrees
that it will indemnify and hold the Banks, the Issuing Banks and the
Administrative Agent and their respective affiliates, and each of the
representatives, agents and officers of each of the

- 50 -

 

foregoing, harmless from
and against any and all claims, expense, damage, loss or liability incurred by
the Banks, the Issuing Banks or the Administrative Agent (including all
reasonable costs of legal representation incurred by the Banks, the Issuing
Banks or the Administrative Agent) relating to (a) any Release or threatened
Release of Hazardous Substances on the Real Property; (b) any violation of any
Environmental Laws or Applicable Requirements with respect to conditions at the
Real Property or other assets of the Borrower or its Subsidiaries, or the
operations conducted thereon; or (c) the investigation or remediation of
offsite locations at which the Borrower, any of its Subsidiaries, or their
predecessors are alleged to have directly or indirectly Disposed of Hazardous
Substances. It is expressly acknowledged by the Borrower that this covenant of
indemnification shall survive the payment of the Loans and Reimbursement
Obligations and satisfaction of all other Obligations hereunder and shall inure
to the benefit of the Banks, the Issuing Banks, the Administrative Agent and
their affiliates, successors and assigns.

          §7.12. Further Assurances. The Borrower and the Guarantor will cooperate
with the Administrative Agent and execute such further instruments and
documents as the Administrative Agent shall reasonably request to carry out to
the Majority Banks’ satisfaction the transactions contemplated by this
Agreement.

          §7.13. Notice of Potential Claims or Litigation. The Borrower shall
deliver to the Banks written notice of the initiation of any action, claim,
complaint, investigation or any other notice of dispute or litigation against
the Borrower or any of its Subsidiaries that could reasonably be expected to
have a Material Adverse Effect, or which questions the validity or
enforceability of any Loan Document, together with a copy of each such
complaint or other notice received by the Borrower or any of its Subsidiaries
if requested by the Administrative Agent within 30 days of receipt thereof or
of the determination that such action could reasonably be expected to have a
Material Adverse Effect, whichever occurs later (and the Borrower will make
such determination in each case as promptly as practicable).

          §7.14.
Notice of Certain Events Concerning Environmental Claims. The
Borrower will promptly, and in any event within ten (10) Business Days of
the Borrower’s obtaining knowledge thereof, notify the Banks in writing of
any of the following events:

          (i) the Borrower’s or any Significant Subsidiary’s obtaining
knowledge of any violation of any Environmental Law regarding the Real
Property or the Borrower’s or any Subsidiary’s operations which violation could reasonably be
expected to have a Material Adverse Effect;

          (ii) the Borrower’s or any Significant Subsidiary’s obtaining
knowledge of any potential or known Release, or threat of Release, of any
Hazardous Substance at, from, or into the Real Property which could
reasonably be expected to have a Material Adverse Effect;

          (iii) the Borrower’s or any Significant Subsidiary’s receipt of any
notice of any material violation of any Environmental Law or of any
Release or threatened Release of Hazardous Substances, including a notice
or claim of liability or potential responsibility

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from any third party
(including any federal, state, provincial, territorial or local
governmental officials) and including notice of any formal inquiry,
proceeding, demand, investigation or other action with regard to (A) the
Borrower’s, any Significant Subsidiary’s or any Person’s operation of the
Real Property, (B) contamination on, from, or into the Real Property, or
(C) investigation or remediation of offsite locations at which the
Borrower, any Significant Subsidiary, or its predecessors are alleged to
have directly or indirectly Disposed of Hazardous Substances, if any
thereof could reasonably be expected to have a Material Adverse Effect; or

          (iv) the Borrower’s or any Significant Subsidiary’s obtaining
knowledge that any expense or loss has been incurred by any governmental
authority in connection with the assessment, containment, removal or
remediation of any Hazardous Substances with respect to which the Borrower
or any Significant Subsidiary has been alleged to be liable by such
governmental authority or for which a Lien may be imposed on the Real
Property by such governmental authority, if any thereof could reasonably
be expected to have a Material Adverse Effect.

          §7.15. Notice of Default. The Borrower will promptly notify the Banks in
writing of the occurrence of any Default or Event of Default. If any Person
shall give any notice or take any other action in respect of a claimed default
(whether or not constituting an Event of Default) under this Agreement or any
other note, evidence of indebtedness, indenture or other obligation evidencing
indebtedness in excess of $25,000,000 as to which the Borrower or any of its
Significant Subsidiaries is a party or obligor, whether as principal or surety,
the Borrower shall promptly upon obtaining actual knowledge thereof give
written notice thereof to the Banks, describing the notice of action and the
nature of the claimed default.

          §7.16. Use of Proceeds. The proceeds of the Loans shall be used for
general corporate purposes, to provide working capital, to backstop commercial
paper, to provide letters of credit and to refinance existing Indebtedness of
the Borrower and its Subsidiaries. No proceeds of the Loans shall be used in
any way that will violate Regulations U or X of the Board of Governors of the
Federal Reserve System.

          §7.17. Certain Transactions. Except as disclosed in the Disclosure Documents prior to the Effective
Date, and except for arm’s length transactions pursuant to which the Borrower
or any Subsidiary makes payments in the ordinary course of business, none of
the officers, directors, or employees or any other affiliate of the Borrower or
any Subsidiary are presently or shall be a party to any transaction with the
Borrower or any Subsidiary (other than for services as employees, officers and
directors), including any contract, agreement or other arrangement providing
for the furnishing of services to or by, providing for rental of real or
personal property to or from, or otherwise requiring payments to or from any
officer, director or such employee or, to the knowledge of the Borrower or any
Subsidiary, any corporation, partnership, trust or other entity in which any
officer, director, or any such employee has a substantial interest or is an
officer, director, trustee or partner.

§8. NEGATIVE COVENANTS OF THE BORROWER. The Borrower agrees that, so long
as any Obligation or Letter of Credit is outstanding or the Banks have any
obligation to make Loans or any Issuing Bank has any obligation to issue,
extend or renew any Letter of

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Credit hereunder, or the Banks have any
obligation to reimburse any Issuing Bank for drawings honored under any Letter
of Credit, it shall, and shall cause its Subsidiaries to, comply with the
following covenants:

          §8.1. Restrictions on Indebtedness. The Borrower will not permit any of
its Subsidiaries to create, incur, assume, or be or remain liable, contingently
or otherwise, with respect to any Indebtedness, or become or be responsible in
any manner (whether by agreement to purchase any obligations, stock, assets,
goods or services, or to supply or advance any funds, assets, goods or services
or otherwise) with respect to any Indebtedness of any other Person (other than
the Borrower or any of its Subsidiaries), other than:

          (a) Indebtedness of the Borrower’s Subsidiaries listed in Schedule
8.1(a) and any extension, renewal or refinancing of such Indebtedness,
provided that the terms and conditions of any such extensions, renewals or
refinancings do not increase the relative priority of the original
Indebtedness and provided, further, that such extended, renewed or
refinanced Indebtedness does not in the aggregate exceed the Dollar amount
of the original Indebtedness; and

          (b) Other Indebtedness of the Borrower’s Subsidiaries (other than of
the Guarantor) provided that the aggregate amount of all such Indebtedness
under this §8.1(b), when added (without duplication) to the aggregate
outstanding amount of secured Indebtedness of the Borrower and its
Subsidiaries under subsections (k), (l) and (m) of the definition of
“Permitted Liens” and Indebtedness with respect to Permitted Receivables
Transactions, shall not exceed 15% of Consolidated Tangible Assets at any
time.

          §8.2. Restrictions on Liens. The Borrower will not, and will cause its
Subsidiaries not to, create or incur or suffer to be created or incurred or to
exist any Lien of any kind upon any property or assets of any character, whether now owned or hereafter acquired, or upon
the income or profits therefrom; or transfer any of such property or assets or
the income or profits therefrom for the purpose of subjecting the same to the
payment of Indebtedness or performance of any other obligation in priority to
payment of its general creditors; or acquire, or agree or have an option to
acquire, any property or assets upon conditional sale or other title retention
or purchase money security agreement, device or arrangement; or suffer to exist
for a period of more than 30 days after the same shall have been incurred any
Indebtedness or claim or demand against it which if unpaid might by law or upon
bankruptcy or insolvency, or otherwise, be given any priority whatsoever over
its general creditors; or sell, assign, pledge or otherwise transfer any
accounts, contract rights, general intangibles or chattel paper, with or
without recourse, except for Permitted Liens.

     The Borrower and the Guarantor covenant and agree that if either of them
or any of their Subsidiaries shall create or incur any Lien upon any of their
respective properties or assets, whether now owned or hereafter acquired, other
than Permitted Liens (unless prior written consent shall have been obtained
from the Banks), the Borrower and the Guarantor will make or cause to be made
effective provision whereby the Obligations and the Guaranteed Obligations will
be secured by such Lien equally and ratably with any and all other Indebtedness
thereby secured so long as such other Indebtedness shall be so secured;
provided that the covenants of

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the Borrower and the Guarantor contained in this
sentence shall only be in effect for so long as the Borrower or the Guarantor
shall be similarly obligated under any other Indebtedness; provided, further,
that an Event of Default shall occur for so long as such other Indebtedness
becomes secured notwithstanding any actions taken by the Borrower or the
Guarantor to ratably secure the Obligations and the Guaranteed Obligations
hereunder.

          §8.3. Restrictions on Investments. Except to the extent provided in §8.4,
neither the Borrower nor any Subsidiary may make or permit to exist or to
remain outstanding any Investment, other than Investments in Cash Equivalents
unless both before and after giving effect thereto (i) the Borrower and its
Subsidiaries are in compliance with the covenants set forth in §§7, 8 and 9
hereof and (ii) there does not exist a Default or Event of Default and no
Default or Event of Default would be created by the making of such Investment;
provided that the aggregate amount of all Investments (excluding Investments in
Cash Equivalents), does not exceed 15% of Consolidated Tangible Assets; and
provided further that the ability of the Subsidiaries of the Borrower to incur
any Indebtedness in connection with any Investment permitted by this §8.3 shall
be governed by §8.1.

          §8.4. Mergers, Consolidations, Sales.

          (a) Neither the Borrower nor any Subsidiary shall be a party to any
merger, consolidation or exchange of stock unless the Borrower shall be
the surviving entity with respect to any such transaction to which the
Borrower is a party and the Guarantor shall be the survivor of any merger
with any other Subsidiary or a Subsidiary shall be the surviving entity
(and continue to be a Subsidiary) with respect to any such transactions to
which one or more Subsidiaries is a party (and the conditions set forth
below are satisfied), or purchase or otherwise acquire all or
substantially all of the assets or stock of any class of, or any partnership, membership or joint venture or
other interest in, any other Person except as otherwise provided in §8.3
or this §8.4. Notwithstanding the foregoing, the Borrower and its
Subsidiaries may purchase or otherwise acquire all or substantially all of
the assets or stock of any class of, or joint venture or other interest
in, any Person if the following conditions have been met: (i) the proposed
transaction will not otherwise create a Default or an Event of Default
hereunder; and (ii) the business to be acquired predominantly involves (A)
the collection, transfer, hauling, disposal or recycling of solid waste or
thermal soil remediation, or (B) other lines of businesses currently
engaged in, or related, associated, complementary or supplementary
thereto, whether from an operational, business, financial, technical or
administrative standpoint; provided that the Borrower or its Subsidiaries
may purchase or otherwise acquire all or substantially all of the assets
or stock of any class of, or any partnership, membership or joint venture
or other interest in, any Persons in unrelated businesses, not to exceed a
total aggregate amount of $400,000,000 during the term of this Agreement.
Notwithstanding anything herein to the contrary, the ability of the
Subsidiaries of the Borrower to incur any Indebtedness in connection with
any transaction permitted pursuant to this §8.4 shall be governed by §8.1.

          (b) Neither the Borrower nor any Subsidiary shall sell, transfer,
convey or lease any assets or group of assets, including the sale or
transfer of any property owned by the Borrower or any Subsidiary in order
then or thereafter to lease such property or

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lease other property which
the Borrower or such Subsidiary intends to use for substantially the same
purpose as the property being sold or transferred, or sell or assign,
with or without recourse, any receivables, except (i) transfers of real
or personal property among Subsidiaries of the Borrower, (ii) so long as
no Default or Event of Default has occurred and is continuing, or would
result therefrom, sales of assets or pursuant to a sale-leaseback
transaction; provided that any net cash proceeds from any such sale or
sale-leaseback shall, within 180 days, either be used to pay down
outstanding Loans under this Agreement or be reinvested by such Person in
assets of the business of the Borrower and its Subsidiaries, used for
working capital, invested in Investments in accordance with the
provisions of §8.3 or used for other general corporate purposes, (iii)
sales of accounts receivable (and contract rights, general intangibles or
chattel paper related thereto) more than sixty (60) days past due sold or
assigned in the ordinary course of collecting past due accounts, or (iv)
pursuant to a Permitted Receivables Transaction.

          §8.5. Restricted Distributions and Redemptions. Neither the Borrower nor
any of its Subsidiaries will (a) declare or pay any Distributions, or (b)
redeem, convert, retire or otherwise acquire shares of any class of its capital
stock (other than in connection with a merger permitted by §8.4 hereof or
conversion into another form of equity of any preferred shares of the Borrower
existing as of the Effective Date pursuant to the terms thereof), unless at the
time of such Distribution or redemption no Default or Event of Default exists
or would be created hereunder. Notwithstanding the above, any Subsidiary may
make Distributions to the Borrower and the Borrower agrees that neither the
Borrower nor any Significant Subsidiary will enter into any agreement
restricting Distributions from such Significant Subsidiary to the Borrower.

          §8.6. Employee Benefit Plans. None of the Borrower, any of its
Subsidiaries, or any ERISA Affiliate will:

          (a) engage in any “prohibited transaction” within the meaning of §406
of ERISA or §4975 of the Code which could result in a material liability
for the Borrower on a consolidated basis; or

          (b) permit any Guaranteed Pension Plan to incur an “accumulated
funding deficiency”, as such term is defined in §302 of ERISA, whether or
not such deficiency is or may be waived; or

          (c) fail to contribute to any Guaranteed Pension Plan to an extent
which, or terminate any Guaranteed Pension Plan in a manner which, could
result in the imposition of a lien or encumbrance on the assets of the
Borrower or the Guarantor pursuant to §302(f) or §4068 of ERISA; or

          (d) permit or take any action which would result in the aggregate
benefit liabilities (within the meaning of §4001 of ERISA), other than
with respect to the Terminated Plans, of all Guaranteed Pension Plans
exceeding the value of the aggregate assets of such Guaranteed Pension
Plans, disregarding for this purpose the benefit liabilities and assets
of any such Guaranteed Pension Plan with assets in excess of benefit
liabilities.

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     The Borrower and its Subsidiaries will (i) promptly upon the request of
any Bank or the Administrative Agent, furnish to the Banks a copy of the most
recent actuarial statement required to be submitted under §103(d) of ERISA and
Annual Report, Form 5500, with all required attachments, in respect of each
Guaranteed Pension Plan, and (ii) promptly upon receipt or dispatch, furnish to
the Banks any notice, report or demand sent or received in respect of a
Guaranteed Pension Plan under §§302, 4041, 4042, 4043, 4063, 4065, 4066 and
4068 of ERISA, or in respect of a Multiemployer Plan, under §§4041A, 4202,
4219, 4242 or 4245 of ERISA.

§9. FINANCIAL COVENANTS OF THE BORROWER. The Borrower agrees that, so
long as any Obligation or Letter of Credit is outstanding or the Banks have any
obligation to make Loans or any Issuing Bank has any obligation to issue,
extend or renew any Letter of Credit hereunder, or the Banks have any
obligation to reimburse any Issuing Bank for drawings honored under any Letter
of Credit, it shall comply with the following covenants:

          §9.1. Interest Coverage Ratio. As of the end of any fiscal quarter of the
Borrower, the Borrower will not permit the ratio of (a) EBIT for the four
fiscal quarters then ending to (b) Consolidated Total Interest Expense for such
period to be less than 2.75:1.00.

          §9.2. Total Debt to EBITDA. As of the end of any fiscal quarter of the Borrower, the Borrower will
not permit the ratio of (a) Total Debt to (b) EBITDA for the four fiscal
quarters then ending to exceed 3.50:1.00.

§10. CONDITIONS PRECEDENT.

          §10.1. Conditions To Effectiveness. The effectiveness of this Agreement
and the obligations of the Banks to make any Loans and of any Issuing Bank to
issue Letters of Credit and of the Banks to participate in Letters of Credit
and otherwise be bound by the terms of this Agreement shall be subject to the
satisfaction of each of the following conditions precedent:

               §10.1.1. Corporate Action. All corporate action necessary for the valid
execution, delivery and performance by the Borrower and the Guarantor of
the Loan Documents shall have been duly and effectively taken, and
evidence thereof certified by authorized officers of the Borrower and the
Guarantor and satisfactory to the Administrative Agent shall have been
provided to the Banks.

               §10.1.2. Loan Documents, Etc. Each of the Loan Documents and other
documents listed on the closing agenda shall have been duly and properly
authorized, executed and delivered by the respective parties thereto and
shall be in full force and effect in a form satisfactory to the Majority
Banks.

               §10.1.3. Certified Copies of Charter Documents. The Banks shall have
received from each of the Borrower and the Guarantor, certified by a duly
authorized officer of such Person to be true and complete on the
Effective Date, (a) its charter or other incorporation documents, (b) its
by-laws and (c) good standing certificates and foreign qualifications.

               §10.1.4. Incumbency Certificate. The Banks shall have received an
incumbency certificate, dated as of the Effective Date, signed by duly

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authorized officers of the Borrower and the Guarantor giving the name and
bearing a specimen signature of each individual who shall be authorized:
(a) to sign the Loan Documents on behalf of the Borrower and the
Guarantor; (b) to make Syndicated Loan Requests and Letter of Credit
Requests; (c) to make Competitive Bid Quote Requests; and (d) to give
notices and to take other action on the Borrower’s or the Guarantor’s
behalf under the Loan Documents.

     §10.1.5. Certificates of Insurance. The Administrative Agent shall have
received a certificate of insurance from an independent insurance broker
dated as of the Effective Date, or within 15 days prior
thereto, identifying insurers, types of insurance, insurance limits, and
policy terms, and otherwise describing the insurance coverage of the
Borrower and its Subsidiaries.

     §10.1.6. Opinion of Counsel. The Banks shall have received a favorable
legal opinion from the Vice President and Assistant General Counsel of
the Borrower and the Guarantor addressed to the Banks, dated the
Effective Date, in form and substance satisfactory to the Administrative
Agent, and a favorable legal opinion of Milbank, Tweed, Hadley & McCloy
LLP, special New York counsel to the Administrative Agent, dated the
Effective Date, as to the validity and binding effect of this Agreement.

     §10.1.7. Satisfactory Financial Condition. Other than as disclosed in
the Disclosure Documents, no material adverse change shall have occurred
in the financial condition, results of operations, business, properties
or prospects of the Borrower and its Subsidiaries, taken as a whole,
since the Balance Sheet Date.

     §10.1.8. Payment of Closing Fees. The Borrower shall have paid the
agreed-upon closing fees to the Administrative Agent for the account of
the Banks.

     §10.1.9. Termination of Existing Credit Agreements. The Existing Credit
Agreements shall be paid in full and terminated.

     §10.1.10. Closing Certificate. The Borrower shall have delivered to the
Administrative Agent a certificate, dated as of the Effective Date,
stating that, as of such date (a) the representations and warranties set
forth herein and in the other Loan Documents are true and correct, and
(b) no Default or Event of Default has occurred and is continuing.

§11. CONDITIONS TO ALL LOANS. The obligations of the Banks to make or
continue for an additional Interest Period in accordance with §2.7 any Loan and
the obligation of any Issuing Bank to issue, extend, or renew any Letter of
Credit at the time of and subsequent to the Effective Date is subject to the
following conditions precedent:

          §11.1. Representations True. The Borrower shall have certified to the
Administrative Agent and the Banks that each of the representations and
warranties of the Borrower and the Guarantor (as applicable) contained in this
Agreement or in any document or instrument delivered pursuant to or in
connection with this Agreement, other than the

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representation and warranty in
§6.5 hereof, is true as of the date as of which they were made and shall also be true
at and as of the time of the making of such Loan or the issuance, extension, or
renewal of any Letter of Credit, as applicable, with the same effect as if made
at and as of that time (except to the extent of changes resulting from
transactions contemplated or permitted by this Agreement and changes occurring
in the ordinary course of business which either individually or in the
aggregate do not result in a Material Adverse Effect, and to the extent that
such representations and warranties relate expressly and solely to an earlier
date).

          §11.2. Performance; No Event of Default. The Borrower shall have
performed and complied with all terms and conditions herein required to be
performed or complied with by it prior to or at the time of the making of any
Loan or the issuance, extension or renewal of any Letter of Credit, and at the
time of the making of any Loan or the issuance, renewal or extension of any
Letter of Credit there shall exist no Default or Event of Default or condition
which would result in a Default or an Event of Default upon consummation of
such Loan or issuance, extension, or renewal of any Letter of Credit, as
applicable. Each request for a Loan or for issuance, extension or renewal of a
Letter of Credit shall constitute certification by the Borrower that the
condition specified in this §11.2 will be duly satisfied on the date of such
Loan or Letter of Credit issuance, extension or renewal.

          §11.3. Proceedings and Documents. All proceedings in connection with the
transactions contemplated by this Agreement shall have been taken and all
documents incident thereto shall have been delivered to the Banks as of the
date of the making of any extension of credit in substance and in form
satisfactory to the Banks, including without limitation a Syndicated Loan
Request or a Letter of Credit Request and the Banks shall have received all
information and such counterpart originals or certified or other copies of such
documents as the Banks may reasonably request.

§12. EVENTS OF DEFAULT; ACCELERATION; TERMINATION OF COMMITMENT.

          §12.1. Events of Default and Acceleration. If any of the following events
(“Events of Default” or, if the giving of notice or the lapse of time or both
is required, then, prior to such notice and/or lapse of time, “Defaults”) shall
occur:

     (a) if the Borrower shall fail to pay any principal of the Loans when
the same shall become due and payable, whether at the stated date of
maturity or any accelerated date of maturity or at any other date fixed
for payment;

     (b) if the Borrower shall fail to pay any interest or fees or other
amounts owing hereunder (other than those specified in subsection (a)
above) within five (5) Business Days after the same shall become due and
payable whether at the Maturity Date or any accelerated date of maturity
or at any other date fixed for payment;

     (c) if the Borrower shall fail to comply with any of the covenants
contained in §§7.4, 7.5, 7.15, 7.16, 8 and 9 hereof;

     (d) if the Borrower shall fail to perform any term, covenant or
agreement contained herein or in any of the other Loan Documents (other
than those specified in

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subsections (a), (b), and (c) above) and such
failure shall not be remedied within 30 days after written notice of such
failure shall have been given to the Borrower by the Administrative Agent
or any of the Banks;

          (e) if any representation or warranty contained in this Agreement or
in any document or instrument delivered pursuant to or in connection with
this Agreement shall prove to have been false in any material respect
upon the date when made or repeated;

          (f) if the Borrower or any of its Subsidiaries shall fail to pay
when due, or within any applicable period of grace, any Indebtedness or
obligations under Swap Contracts in an aggregate amount greater than
$50,000,000, or fail to observe or perform any material term, covenant or
agreement contained in any one or more agreements by which it is bound,
evidencing or securing any Indebtedness or obligations under Swap
Contracts in an aggregate amount greater than $50,000,000 for such period
of time as would permit, or would have permitted (assuming the giving of
appropriate notice if required) the holder or holders thereof or of any
obligations issued thereunder to accelerate the maturity thereof or
terminate its commitment with respect thereto;

          (g) if the Borrower, the Guarantor or any Significant Subsidiary
makes an assignment for the benefit of creditors, or admits in writing
its inability to pay or generally fails to pay its debts as they mature
or become due, or petitions or applies for the appointment of a trustee
or other custodian, liquidator or receiver of the Borrower, the Guarantor
or any Significant Subsidiary, or of any substantial part of the assets
of the Borrower, the Guarantor or any Significant Subsidiary or commences
any case or other proceeding relating to the Borrower, the Guarantor or
any Significant Subsidiary under any bankruptcy, reorganization,
arrangement, insolvency, readjustment of debt, dissolution or liquidation
or similar law of any jurisdiction, now or hereafter in effect, or takes
any action to authorize or in furtherance of any of the foregoing, or if
any such petition or application is filed or any such case or other
proceeding is commenced against the Borrower, the Guarantor or any
Significant Subsidiary or the Borrower, the Guarantor or any Significant
Subsidiary indicates its approval thereof, consent thereto or
acquiescence therein;

          (h) if a decree or order is entered appointing any such trustee,
custodian, liquidator or receiver or adjudicating the Borrower or the
Guarantor or any Significant Subsidiary bankrupt or insolvent, or
approving a petition in any such case or other proceeding, or a decree or
order for relief is entered in respect of the Borrower or the Guarantor
or any Significant Subsidiary in an involuntary case under federal
bankruptcy laws of any jurisdiction as now or hereafter constituted;

          (i) if there shall remain in force, undischarged, unsatisfied and
unstayed, for more than thirty days, whether or not consecutive, any
final judgment against the Borrower or any Subsidiary which, with other outstanding final
judgments against the Borrower and its Subsidiaries, exceeds in the
aggregate $25,000,000 after taking into account any undisputed insurance
coverage;

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          (j) if, with respect to any Guaranteed Pension Plan, an ERISA
Reportable Event shall have occurred and the Banks shall have determined
in their reasonable discretion that such event reasonably could be
expected to result in liability of the Borrower or any Subsidiary to the
PBGC or such Plan in an aggregate amount exceeding $25,000,000 and such
event in the circumstances occurring reasonably could constitute grounds
for the partial or complete termination of such Plan by the PBGC or for
the appointment by the appropriate United States District Court of a
trustee to administer such Plan; or a trustee shall have been appointed
by the appropriate United States District Court to administer such Plan;
or the PBGC shall have instituted proceedings to terminate such Plan;

          (k) if any of the Loan Documents shall be cancelled, terminated,
revoked or rescinded otherwise than in accordance with the terms thereof
or with the express prior written agreement, consent or approval of the
Banks, or any action at law, suit or in equity or other legal proceeding
to cancel, revoke or rescind any of the Loan Documents shall be commenced
by or on behalf of the Borrower, the Guarantor, or any of their
respective stockholders, or any court or any other governmental or
regulatory authority or agency of competent jurisdiction shall make a
determination that, or issue a judgment, order, decree or ruling to the
effect that, any one or more of the Loan Documents is illegal, invalid or
unenforceable in accordance with the terms thereof; or

          (l) if any person or group of persons (within the meaning of Section
13 or 14 of the Securities Exchange Act of 1934, as amended) shall have
acquired beneficial ownership (within the meaning of Rule 13d-3
promulgated by the Securities and Exchange Commission under said Act) of
25% or more of the outstanding shares of common voting stock of the
Borrower; or during any period of twelve consecutive calendar months,
individuals who were directors of the Borrower on the first day of such
period (together with any new directors whose election by such board or
whose nomination for election by the shareholders of the Borrower was
approved by a vote of a majority of the directors still in office who
were either directors at the beginning of such period or whose election
or nomination for election was previously so approved) shall cease to
constitute a majority of the board of directors of the Borrower;

then, and in any such event, so long as the same may be continuing, the
Administrative Agent may, and upon the request of the Majority Banks shall, by
notice in writing to the Borrower, declare all amounts owing with respect to
this Agreement and the other Loan Documents and all Reimbursement Obligations
to be, and they shall thereupon forthwith become, immediately due and payable
without presentment, demand, protest, notice of intent to accelerate, notice of
acceleration to the extent permitted by law or other notice of any kind, all of
which are hereby expressly waived by the Borrower; provided that in the event
of any Event of Default specified in §12.1(g) or 12.1(h) with respect to the
Borrower or the Guarantor, all such amounts shall become immediately due and
payable automatically and without any requirement of notice from the
Administrative Agent or any Bank. Upon demand by the Majority Banks after the occurrence of any Event of Default, the
Borrower shall immediately provide to the Administrative Agent cash in an
amount equal to the aggregate Maximum Drawing Amount to be held by the
Administrative Agent as collateral security for the Reimbursement Obligations.

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          §12.2. Termination of Commitments. If any Event of Default pursuant to §§
12.1(g) or 12.1(h) hereof shall occur with respect to the Borrower or the
Guarantor, any unused portion of the Total Commitment hereunder shall forthwith
terminate and the Banks and the Issuing Banks shall be relieved of all
obligations to make Loans or to issue, extend or renew Letters of Credit
hereunder; or if any other Event of Default shall occur, the Majority Banks may
by notice to the Borrower terminate the unused portion of the Total Commitment
hereunder, and, upon such notice being given, such unused portion of the Total
Commitment hereunder shall terminate immediately and the Banks and the Issuing
Banks shall be relieved of all further obligations to make Loans or to issue,
extend or renew Letters of Credit hereunder. No termination of any portion of
the Total Commitment hereunder shall relieve the Borrower of any of its
existing Obligations to the Banks, the Issuing Banks or the Administrative
Agent hereunder or elsewhere.

          §12.3. Remedies. In case any one or more of the Events of Default shall
have occurred and be continuing, and whether or not the Banks shall have
accelerated the maturity of the Loans and other Obligations pursuant to §12.1,
each Bank, upon notice to the other Banks, if owed any amount with respect to
the Loans or the Reimbursement Obligations, may proceed to protect and enforce
its rights by suit in equity, action at law or other appropriate proceeding,
whether for the specific performance of any covenant or agreement contained in
this Agreement and the other Loan Documents or any instrument pursuant to which
the Obligations to such Bank are evidenced, including, without limitation, as
permitted by applicable law the obtaining of the ex parte appointment of a
receiver, and, if such amount shall have become due, by declaration or
otherwise, proceed to enforce the payment thereof or any legal or equitable
right of such Bank, any recovery being subject to the terms of §29 hereof. No
remedy herein conferred upon any Bank or the Administrative Agent or the holder
of any Note is intended to be exclusive of any other remedy and each and every
remedy shall be cumulative and shall be in addition to every other remedy given
hereunder or now or hereafter existing at law or in equity or by statute or any
other provision of law.

§13. SETOFF. During the continuance of an Event of Default, any deposits
or other sums credited by or due from any Bank to the Borrower and any
securities or other property of the Borrower in the possession of such Bank may
be applied to or set off against the payment of the Obligations and any and all
other liabilities, direct, or indirect, absolute or contingent, due or to
become due, now existing or hereafter arising, of the Borrower to the Banks or
the Administrative Agent. Any amounts set off with respect to the Obligations
shall be distributed ratably in accordance with §29 among all of the Banks by
the Bank setting off such amounts. If any Bank fails to share such setoff ratably, the Administrative Agent
shall have the right to withhold such Bank’s share of the Borrower’s payments
until each of the Banks shall have, in the aggregate, received a pro rata
repayment.

§14. EXPENSES. Whether or not the transactions contemplated herein shall
be consummated, the Borrower hereby promises to reimburse the Administrative
Agent and the Joint Lead Arrangers and Joint Book Managers for all reasonable
out-of-pocket fees and disbursements (including all reasonable attorneys’ fees)
incurred or expended in connection with the syndication, preparation, filing or
recording, or interpretation of this Agreement, the other Loan Documents, or
any amendment, modification, approval, consent or waiver hereof or thereof. The
Borrower further promises to reimburse the Administrative Agent and the Banks
for

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all reasonable out-of-pocket fees and disbursements (including all
reasonable legal fees and the allocable cost of in-house attorneys’ fees)
incurred or expended in connection with the enforcement of any Obligations or
the satisfaction of any indebtedness of the Borrower hereunder or under any
other Loan Document, or in connection with any litigation, proceeding or
dispute hereunder in any way related to the credit hereunder. The Borrower also
promises to pay the Administrative Agent all reasonable out-of-pocket fees and
disbursements, incurred or expended in connection with the Competitive Bid Loan
procedure under §4 hereof.

§15. THE AGENTS.

          §15.1. Authorization and Action. Each Bank hereby irrevocably appoints
Citibank as Administrative Agent hereunder and authorizes Citibank to take such
action as Administrative Agent on its behalf and to exercise such powers under
this Agreement as are delegated to the Administrative Agent by the terms hereof
and thereof, together with such powers as are reasonably incidental thereto.
As to any matters not expressly provided for by this Agreement and the other
Loan Documents, the Administrative Agent shall not be required to exercise any
discretion or take any action, but shall be required to act or to refrain from
acting (and shall be fully protected in so acting or refraining from acting)
upon the instructions of the Majority Banks (or, when expressly required
hereby, all of the Banks), and such instructions shall be binding upon all
Banks; provided, however, that the Administrative Agent shall not be required
to take any action which exposes the Administrative Agent to personal liability
or which is contrary to this Agreement or the other Loan Documents or
applicable law.

          §15.2. Administrative Agent’s Reliance, Etc. Neither the Administrative Agent
nor any of its directors, officers, agents or employees shall be liable to any
of the Banks for any action taken or omitted to be taken by it or them under or
in connection with this Agreement or the other Loan Documents, except for its
or their own gross negligence or willful misconduct. Without limitation of the
generality of the foregoing, the Administrative Agent: (i) may consult with
legal counsel (including counsel for the Borrower), independent public
accountants and other experts selected by it and shall not be liable to the
Banks for any action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants or experts; (ii) makes
no warranty or representation to any Bank and shall not be responsible to any
Bank for any statements, warranties or representations (whether written or
oral) made in or in connection with this Agreement or the other Loan Documents;
(iii) shall not have any duty to ascertain or to inquire as to the performance
or observance of any of the terms, covenants or conditions of this Agreement or
the other Loan Documents on the part of the Borrower or the Guarantor or to
inspect the property (including the books and records) of the Borrower or the
Guarantor or any of their Subsidiaries, and shall not be deemed to have
knowledge or notice of any Default or Event of Default unless and until it
shall have received, at its office specified in §22, a notice describing the
same and entitled “Notice of Default”; (iv) shall not be responsible to any
Bank for the due execution (other than its own), legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or any
related agreement, instrument or document furnished pursuant hereto; and (v)
shall incur no liability to the Banks under or in respect of this Agreement by
acting upon any notice, consent, certificate or other instrument or writing
(which may be by telecopier, telegram, cable or telex) reasonably believed by
it to be genuine and signed or sent by the proper party or parties.

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          §15.3. Citibank and Affiliates. With respect to its Commitment, Citibank shall
have the same rights and powers under this Agreement and under the other Loan
Documents as any other Bank and may exercise the same as though it were not the
Administrative Agent, and the term “Bank” or “Banks” shall, unless otherwise
expressly indicated, include Citibank in its individual capacity. Citibank and
its Affiliates may accept deposits from, lend money to, act as trustee under
indentures of, and generally engage in any kind of business with, the Borrower,
the Guarantor, any of their Subsidiaries and any Person who may do business
with or own securities of the Borrower, the Guarantor, or any such Subsidiary,
all as if Citibank were not the Administrative Agent and without any duty to
account therefor to the Banks.

          §15.4. Bank Credit Decision. Each Bank acknowledges that it has, independently
and without reliance upon the Administrative Agent or any other Bank and based
on the financial statements referred to in §6.4 and such other documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement and the other Loan Documents. Each Bank
also acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Bank and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement and the
other Loan Documents.

          §15.5. Indemnification. The Banks agree to indemnify the Administrative Agent
(to the extent not reimbursed by the Borrower), ratably according to the
respective amounts of their Commitments as most recently in effect at the time
such indemnity is sought, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever which may be imposed
on, incurred by, or asserted against the Administrative Agent in any way relating to or arising out of this Agreement or
the other Loan Documents or any action taken or omitted by the Administrative
Agent under this Agreement or the other Loan Documents, provided that no Bank
shall be liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting from the Administrative Agent’s gross negligence or willful
misconduct. Without limiting the foregoing, each Bank agrees to reimburse the
Administrative Agent promptly upon demand for its ratable share as aforesaid of
any out of pocket expenses (including counsel fees) 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 and the other Loan Documents,
to the extent that the Administrative Agent is not reimbursed for such expenses
by the Borrower.

          §15.6. Successor Administrative Agent. The Administrative Agent may resign at
any time by giving written notice thereof to the Banks and the Borrower and may
be removed at any time with or without cause by the Majority Banks. Upon any
such resignation or removal, the Majority Banks shall have the right to appoint
a successor Administrative Agent that, unless a Default or Event of Default
shall have occurred and then be continuing, is reasonably acceptable to the
Borrower. If no successor Administrative Agent shall have been so appointed by
the Majority Banks, and shall have accepted such appointment, within 30 days
after the retiring Administrative Agent’s giving of notice of resignation or
the Majority Banks’

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removal of the retiring Administrative Agent, then the
retiring Administrative Agent may, on behalf of the Banks, appoint a successor
Administrative Agent, which shall be a commercial bank organized under the laws
of the United States of America or of any State thereof and having total assets
of at least $1,000,000,000. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative Agent, such
successor Administrative Agent shall thereupon succeed to and become vested
with all the rights, powers, privileges and duties of the retiring
Administrative Agent, and the retiring Administrative Agent shall be discharged
from its duties and obligations under this Agreement and the other Loan
Documents. After any retiring Administrative Agent’s resignation or removal
hereunder as Administrative Agent, the provisions of this §15 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.

          §15.7.
Lead Arrangers, Etc. The parties identified on the cover hereof as Lead
Arrangers and Bookrunners, Syndication Agents and Documentation Agents shall
have no obligations or liabilities under this Agreement and the other Loan
Documents.

          §15.8.
Documents. The Administrative Agent will forward to each Bank,
promptly after receipt thereof, a copy of each notice or other document
furnished to the Administrative Agent for such Bank hereunder; provided,
however, that, notwithstanding the foregoing, the Administrative Agent may
furnish to the Banks a monthly summary with respect to Letters of Credit issued hereunder in lieu of copies of the related Letter of Credit
Applications.

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

          (b) Except as otherwise provided in §3.1(a) hereof with respect to
Schedule 3.1, neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the Borrower and the Majority Banks or by the Borrower and the
Administrative Agent with the consent of the Majority Banks; provided that no
such agreement shall (i) increase the Commitment of any Bank without the
written consent of such Bank, (ii) reduce the principal amount of any Loan or
Reimbursement Obligations, or reduce the rate of interest on the Loans or
reduce any fees payable hereunder, without the written consent of each Bank
affected thereby; (iii) postpone the date of any payment of the principal
amount of any Loan, or any interest thereon, or any fees

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payable hereunder, or
reduce the amount of, waive or excuse any such payment, or postpone the
scheduled date of expiration of any Commitment, without the written consent of
each Bank affected thereby; (iv) release the Borrower from its Obligations or
the Guarantor from its Guaranteed Obligations hereunder without the written
consent of each Bank; (v) modify §29(a) or any other provision of this
Agreement providing for pro rata payments to or by the Banks; or (vi) change
any of the provisions of this §15.9 or any provision of this Agreement
requiring action by all the Banks, or the percentage of Banks constituting
“Majority Banks”, without the written consent of each Bank; provided further
that no such agreement shall amend, modify or otherwise affect the rights or
duties of the Administrative Agent or any Issuing Bank hereunder without the
prior written consent of the Administrative Agent or the Issuing Banks, as the
case may be.

§16. INDEMNIFICATION. The Borrower agrees to indemnify and hold harmless
the Banks, the Issuing Banks, the Joint Lead Arrangers and Joint Book Managers
and the Administrative Agent and their affiliates, as well as the Banks’ and
the Administrative Agent’s and their affiliates’ shareholders, directors,
agents, officers, subsidiaries and affiliates, from and against all damages,
losses, settlement payments, obligations, liabilities, claims, suits,
penalties, assessments, citations, directives, demands, judgments, actions or causes of action,
whether statutorily created or under the common law, and reasonable costs and
expenses incurred, suffered, sustained or required to be paid by an indemnified
party by reason of or resulting from the transactions contemplated hereby,
except any of the foregoing which result from the gross negligence or willful
misconduct of such indemnified party. In any investigation, enforcement matter,
proceeding or litigation, or the preparation therefor, the Banks and the
Administrative Agent shall be entitled to select their own counsel and, in
addition to the foregoing indemnity, the Borrower agrees to pay promptly the
reasonable fees and expenses of such counsel (including the non-duplicative
allocated cost of internal counsel), and settlement costs. In the event of the
commencement of any such proceeding or litigation against the Banks or
Administrative Agent by third parties, the Borrower shall be entitled to
participate in such proceeding or litigation with counsel of their choice at
their expense. The covenants of this §16 shall survive payment or satisfaction
of payment of amounts owing with respect to any Note or the Loans and
satisfaction of all the Obligations hereunder and under the Loan Documents, IT
BEING THE INTENT OF THE PARTIES HERETO THAT ALL SUCH INDEMNIFIED PARTIES SHALL
BE INDEMNIFIED FOR THEIR ORDINARY SOLE OR CONTRIBUTORY NEGLIGENCE. NO PARTY
SHALL BE LIABLE TO ANY OTHER PARTY IN RESPECT OF ANY INDIRECT, CONSEQUENTIAL OR
PUNITIVE DAMAGES.

§17. WITHHOLDING TAXES. The Borrower hereby agrees that:

          (a) Any and all payments made by the Borrower hereunder shall be made
free and clear of, and without deduction for, any and all present or
future taxes, levies, fees, duties, imposts, deductions, charges or
withholdings of any nature whatsoever, excluding, in the case of each of
the Administrative Agent and each of the Banks, (i) taxes imposed on, or
measured by, its net income or profits, (ii) franchise taxes imposed on
it, (iii) taxes imposed by any jurisdiction as a direct consequence of it,
or any of its affiliates, having a present or former connection with such
jurisdiction, including, without limitation, being organized, existing or
qualified to do business, doing business or maintaining a

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permanent
establishment or office in such jurisdiction, and (iv) taxes imposed by
reason of its failure to comply with any applicable certification,
identification, information, documentation or other reporting requirement
(all such non-excluded taxes being hereinafter referred to as
“Indemnifiable Taxes”). In the event that any withholding or deduction
from any payment to be made by the Borrower hereunder is required in
respect of any Indemnifiable Taxes pursuant to any applicable law, or
governmental rule or regulation, then the Borrower will (i) direct to the
relevant taxing authority the full amount required to be so withheld or
deducted, (ii) forward to the Administrative Agent for delivery to the
applicable Bank an official receipt or other documentation satisfactory to
the Administrative Agent and the applicable Bank evidencing such payment
to such taxing authority, and (iii) direct to the Administrative Agent for
the account of the relevant Banks such additional amount or amounts as is
necessary to ensure that the net amount actually received by each relevant
Bank will equal the full amount such Bank would have received had no such
withholding or deduction (including any Indemnifiable Taxes on such
additional amounts) been required. Moreover, if any Indemnifiable Taxes are directly asserted against the Administrative Agent or any Bank
with respect to any payment received by the Administrative Agent or such
Bank by reason of the Borrower’s failure to properly deduct and withhold
such Indemnifiable Taxes from such payment, the Administrative Agent or
such Bank may pay such Indemnifiable Taxes and the Borrower will promptly
pay all such additional amounts (including any penalties, interest or
reasonable expenses) as is necessary in order that the net amount received
by such Person after the payment of such Indemnifiable Taxes (including
any Indemnifiable Taxes on such additional amount) shall equal the amount
such Person would have received had not such Indemnifiable Taxes been
asserted; provided that the Administrative Agent or such Bank, as the case
may be, agrees to use commercially reasonable efforts, at the expense of
the Borrower, to contest or otherwise challenge such Indemnifiable Taxes
if the Administrative Agent or such Bank, as applicable, determines in
good faith that a reasonable basis exists to do so. Any such payment shall
be made promptly after the receipt by the Borrower from the Administrative
Agent or such Bank, as the case may be, of a written statement setting
forth in reasonable detail the amount of the Indemnifiable Taxes and the
basis of the claim.

          (b) The Borrower shall pay any present or future stamp or documentary
taxes or any other excise or any other similar levies which arise from any
payment made hereunder or from the execution, delivery or registration of,
or otherwise with respect to, this Agreement or any other Loan Document
(“Other Taxes”).

          (c) The Borrower hereby indemnifies and holds harmless the
Administrative Agent and each Bank for the full amount of Indemnifiable
Taxes or Other Taxes (including, without limitation, any Indemnifiable
Taxes or Other Taxes imposed on amounts payable under this §17) paid by
the Administrative Agent or such Bank, as the case may be, and any
liability (including penalties, interest and reasonable expenses) arising
therefrom or with respect thereto, by reason of the Borrower’s failure to
properly deduct and withhold Indemnifiable Taxes pursuant to paragraph (a)
above or to properly pay Other Taxes pursuant to paragraph (b) above. Any
indemnification payment from the Borrower under the preceding sentence
shall be made promptly after receipt by the Borrower from the
Administrative Agent or Bank of a written statement setting forth in

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reasonable detail the amount of such Indemnifiable Taxes or such Other
Taxes, as the case may be, and the basis of the claim.

          (d) If the Borrower pays any amount under this §17 to the
Administrative Agent or any Bank and such payee knowingly receives a
refund or tax credit in respect of any taxes with respect to which such
amount was paid, the Administrative Agent or such Bank, as the case may
be, shall remit to the Borrower, promptly following the receipt thereof by
such payee, an amount equal to the amount determined by such payee to be
equal to the amount of any net reduction in taxes actually obtained by
such payee and determined by it to be allocable to such refund or credit;
provided, that the decision as to whether or not to claim any such refund
or credit, and as to the amount and allocation of any such refund or
credit so claimed, shall be made by each such payee in its sole and
absolute discretion; and provided, further, that nothing herein shall be
deemed to obligate any Bank or the Administrative Agent to disclose to the
Borrower or the Guarantor its tax returns or any information regarding its
tax affairs.

          (e) In the event any taxing authority notifies the Borrower or the
Guarantor that any of them has improperly failed to deduct or withhold any
taxes (other than Indemnifiable Taxes) from a payment made hereunder to
the Administrative Agent or any Bank, the Borrower shall timely and fully
pay such taxes to such taxing authority.

          (f) The Administrative Agent or the Banks shall, upon the request of
the Borrower, take reasonable measures to avoid or mitigate the amount of
Indemnifiable Taxes required to be deducted or withheld from any payment
made hereunder if such measures can be taken without such Person in its
sole judgment suffering any legal, regulatory or economic disadvantage.

          (g) Without prejudice to the survival of any other agreement of the
parties hereunder, the agreements and obligations of the Borrower
contained in this §17 shall survive the payment in full of the
Obligations.

§18. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION.

          §18.1. Confidentiality. Each of the Banks and the Administrative Agent
agrees, on behalf of itself and each of its affiliates, directors, officers,
employees and representatives, to use reasonable precautions to keep
confidential, in accordance with their customary procedures for handling
confidential information of the same nature and in accordance with safe and
sound banking practices, any non-public information supplied to it by the
Borrower or any of its Subsidiaries pursuant to this Agreement that is
identified by such Person as being confidential at the time the same is
delivered to the Banks or the Administrative Agent, provided that nothing
herein shall limit the disclosure of any such information (a) after such
information shall have become public other than through a violation of this
§18, or becomes available to any of the Banks or the Administrative Agent on a
nonconfidential basis from a source other than the Borrower, (b) to the extent
required by statute, rule, regulation or judicial process, (c) to counsel for
any of the Banks or the Administrative Agent, (d) to bank examiners or any
other regulatory authority having jurisdiction over any Bank or any of its
affiliates or the Administrative Agent, or to auditors

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or accountants, (e) to
the Administrative Agent, any Bank or any Financial Affiliate, (f) in
connection with any litigation to which any one or more of the Banks, the
Administrative Agent or any Financial Affiliate is a party, or in connection
with the enforcement of rights or remedies hereunder or under any other Loan
Document, (g) to an affiliate of any Bank or the Administrative Agent, (h) to
any actual or prospective assignee or participant or any actual or prospective
counterparty (or its advisors) to any swap or derivative transactions
referenced to credit or other risks or events arising under this Agreement or
any other Loan Document so long as such assignee, participant or counterparty,
as the case may be, agrees to be bound by the provisions of §18.1, or (i) with
the consent of the Borrower.

          §18.2. Prior Notification. Unless specifically prohibited by applicable
law or court order, each of the Banks and the Administrative Agent shall, prior
to disclosure thereof, notify the Borrower of any request for disclosure of any such non-public information by any
governmental agency or representative thereof (other than any such request in
connection with an examination of the financial condition of such Bank by such
governmental agency) or pursuant to legal process.

          §18.3. Other. In no event shall any Bank or the Administrative Agent be
obligated or required to return any materials furnished to it or any Financial
Affiliate by the Borrower or any of its Subsidiaries. The obligations of each
Bank under this §18 shall supersede and replace the obligations of such Bank
under any confidentiality letter in respect of this financing signed and
delivered by such Bank to the Borrower prior to the date hereof and shall be
binding upon any assignee of, or purchaser of any participation in, any
interest in any of the Loans or Reimbursement Obligations from any Bank.

§19. SURVIVAL OF COVENANTS, ETC. Unless otherwise stated herein, all
covenants, agreements, representations and warranties made herein, in the other
Loan Documents or in any documents or other papers delivered by or on behalf of
the Borrower or the Guarantor pursuant hereto shall be deemed to have been
relied upon by the Banks, the Issuing Banks and the Administrative Agent,
notwithstanding any investigation heretofore or hereafter made by them, and
shall survive the making by the Banks of the Loans and the issuance, extension
or renewal of any Letters of Credit by any Issuing Bank, as herein
contemplated, and shall continue in full force and effect so long as any amount
due under this Agreement, any Obligation, or any Letter of Credit remains
outstanding and unpaid or any Bank has any obligation to make any Loans or any
Issuing Bank has any obligation to issue, extend, or renew any Letters of
Credit hereunder. All statements contained in any certificate or other paper
delivered by or on behalf of the Borrower pursuant hereto or in connection with
the transactions contemplated hereby shall constitute representations and
warranties by the Borrower hereunder.

§20. ASSIGNMENT AND PARTICIPATION. It is understood and agreed that each
Bank shall have the right to assign at any time all or a portion of its
Commitment Percentage and interests in the risk relating to the Loans,
outstanding Letters of Credit and its Commitment hereunder in an amount equal
to or greater than $5,000,000 (or, if a Bank’s Commitment is less than
$5,000,000, in a minimum amount equal to such Bank’s Commitment; provided that
prior to any Commitment reductions pursuant to §2.3.1, such Bank’s Commitment
was at least $5,000,000) to additional banks, other financial institutions or
Bank Affiliates with the prior written approval of the Administrative Agent and
each Issuing Bank and, so long as no Event of

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Default has occurred and is
continuing, the Borrower (provided that the Borrower’s consent shall not be
required in the case of an assignment to a Bank Affiliate or to an Approved
Fund), which approvals shall not be unreasonably withheld. Any Bank may at any
time, and from time to time, assign to any branch, lending office, or Bank
Affiliate all or any part of its rights and obligations under the Loan
Documents by notice to the Administrative Agent and the Borrower. It is further
agreed that each bank or other financial institution which executes and
delivers to the Administrative Agent and the Borrower hereunder an Assignment
and Acceptance substantially in the form of Exhibit D hereto (an “Assignment and Acceptance”) together with an assignment fee in
the amount of $3,500 payable by the assigning Bank to the Administrative Agent,
shall, on the date specified in such Assignment and Acceptance, become a party
to this Agreement and the other Loan Documents for all purposes of this
Agreement and the other Loan Documents, and its portion of the Commitment, the
Loans and Letters of Credit shall be as set forth in such Assignment and
Acceptance. The Bank assignor thereunder shall, to the extent that rights and
obligations hereunder have been assigned by it pursuant to such Assignment and
Acceptance, relinquish its rights (except for indemnity rights arising out of
the period prior to such assignment) and be released from its obligations under
this Agreement and the other Loan Documents. Upon the execution and delivery of
such Assignment and Acceptance (a) to the extent applicable, the Borrower shall
issue Notes (and replacement Notes) or the Administrative Agent shall make
appropriate entries on the applicable loan account(s) to reflect such
assignment of Loan(s); and (b) this Agreement and Schedule 1 shall be deemed to
be appropriately amended to reflect (i) the status of the bank, financial
institution or Bank Affiliate as a party hereto and (ii) the status and rights
of the Banks hereunder.

     Each Bank shall also have the right to grant participations to one or more
banks, other financial institutions or Bank Affiliates in its Commitment, the
Loans and outstanding Letters of Credit. The documents evidencing any such
participation shall limit such participating bank’s, financial institution’s or
Bank Affiliate’s, voting rights with respect to this Agreement to the matters
set forth in §15.9(b)(i) – (v).

     Notwithstanding the foregoing, no assignment or participation shall
operate to increase the Total Commitment hereunder or otherwise alter the
substantive terms of this Agreement, and no Bank which retains a Commitment
hereunder shall have a Commitment of less than $5,000,000, except as a result
of reductions in the Total Commitment pursuant to §2.3 hereof.

     Anything contained in this §20 to the contrary notwithstanding, any Bank
may at any time pledge all or any portion of its interest and rights under this
Agreement (including all or any portion of its Notes) to any of the twelve
Federal Reserve Banks organized under §4 of the Federal Reserve Act, 12 U.S.C.
§341. No such pledge or the enforcement thereof shall release the pledgor Bank
from its obligations hereunder or under any of the other Loan Documents.

     The Borrower agrees that in addition to disclosures made in accordance
with standard and customary banking practices any Bank may disclose information
obtained by such Bank pursuant to this Agreement to assignees or participants
and potential assignees or participants hereunder; provided that such assignees
or participants or potential assignees or participants shall agree to be bound
by §18 hereof.

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§21. PARTIES IN INTEREST. All the terms of this Agreement and the other
Loan Documents shall be binding upon and inure to the benefit of and be
enforceable by the respective successors and assigns of the parties hereto and
thereto; provided, that neither the Borrower nor the Guarantor shall assign or
transfer its rights or obligations hereunder or thereunder without the prior
written consent of each of the Banks.

§22. NOTICES, ETC. (a) Subject to clauses (b) and (c) of this §22, all
notices and other communications made or required to be given pursuant to this
Agreement or the other Loan Documents shall be in writing and shall be
delivered in hand, mailed by registered or certified United States first class
mail, postage prepaid, or sent by telegraph, telex or facsimile and confirmed
by letter, addressed as follows:

          (i) if to the Borrower or the Guarantor, at 1001 Fannin Street, Suite
4000, Houston, Texas 77002, Attention: Treasurer, facsimile number (713)
942-1580, with a copy to Attention: General Counsel, facsimile number
(713) 209-9710; or

          (ii) if to the Administrative Agent , at 2 Penns Way, Suite 110, New
Castle, Delaware 19720, Attention: Tara Wooster, facsimile number (212)
994-0961; or

          (iii) if to any Bank, at the last address provided to the
Administrative Agent; or such other address for notice as shall have last been furnished in writing
to the Person giving the notice.

     Any such notice or demand shall be deemed to have been duly given or made
and to have become effective (a) if delivered by hand to a responsible officer
of the party to which it is directed, at the time of the receipt thereof by
such officer, (b) if sent by registered or certified first-class mail, postage
prepaid, seven Business Days after the posting thereof, and (c) if sent by
telex, facsimile, or cable, at the time of the dispatch thereof, if in normal
business hours in the country of receipt, or otherwise at the opening of
business on the following Business Day.

          (b) The Borrower hereby agrees that it will provide to the Administrative
Agent all information, documents and other materials that it is obligated to
furnish to the Administrative Agent pursuant to this Agreement and the other
Loan Documents, including, without limitation, all notices, requests, financial
statements, financial and other reports, certificates and other information
materials, but excluding any such communication that (i) relates to a request
for a new, or a conversion of an existing, Borrowing or other extension of
credit (including any election of an interest rate or Interest Period relating
thereto), (ii) relates to the payment of any principal or other amount due
under this Agreement prior to the scheduled date therefor, (iii) provides
notice of any Default or Event of Default under this Agreement or (iv) is
required to be delivered to satisfy any condition precedent to the
effectiveness of this Agreement and/or any borrowing or other extension of
credit thereunder (all such non-excluded communications being referred to
herein collectively as “Communications”), by transmitting the Communications in
an electronic/soft medium in a format acceptable to the Administrative Agent to
oploanswebadmin@citigroup.com. In addition, the Borrower agrees to continue to provide the Communications
to the Administrative Agent in the manner specified in this Agreement but only
to the extent requested by the Administrative Agent.

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          (c) The Borrower further agrees that the Administrative Agent may make the
Communications available to the Banks by posting the Communications on
Intralinks or a substantially similar electronic transmission system (the
“Platform”).

          (d) THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE”. THE AGENT
PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE
COMMUNICATIONS, OR THE ADEQUACY OF THE PLATFORM AND EXPRESSLY DISCLAIM
LIABILITY FOR ERRORS OR OMISSIONS IN THE COMMUNICATIONS. NO WARRANTY OF ANY
KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING, WITHOUT LIMITATION, AN WARRANTY
OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD
PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY THE
AGENT PARTIES IN CONNECTION WITH THE COMMUNICATIONS OR THE PLATFORM. IN NO
EVENT SHALL THE ADMINISTRATIVE AGENT OR ANY OF ITS AFFILIATES OR ANY OF THEIR
RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, ADVISORS OR REPRESENTATIVES
(COLLECTIVELY, “AGENT PARTIES”) HAVE ANY LIABILITY TO THE BORROWER, ANY BANK OR
ANY OTHER PERSON OR ENTITY FOR DAMAGES OF ANY KIND, INCLUDING, WITHOUT
LIMITATION, DIRECT OR INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES,
LOSSES OR EXPENSES (WHETHER IN TORT, CONTRACT OR OTHERWISE) ARISING OUT OF THE
BORROWER’S OR THE ADMINISTRATIVE AGENT’S TRANSMISSION OF COMMUNICATIONS THROUGH
THE INTERNET, EXCEPT TO THE EXTENT THE LIABILITY OF ANY AGENT PARTY IS FOUND IN
A FINAL NON-APPEALABLE JUDGMENT BY A COURT OF COMPETENT JURISDICTION TO HAVE
RESULTED PRIMARILY FROM SUCH AGENT PARTY’S GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT.

          (e) The Administrative Agent agrees that the receipt of the Communications
by the Administrative Agent at its e-mail address set forth above shall
constitute effective delivery of the Communications to the Administrative Agent
for purposes of this Agreement. Each Bank agrees that notice to it (as
provided in the next sentence) specifying that the Communications have been
posted to the Platform shall constitute effective delivery of the
Communications to such Bank for purposes of this Agreement. Each Bank agrees
to notify the Administrative Agent in writing (including by electronic
communication) from time to time of such Bank’s e-mail address to which the
foregoing notice may be sent by electronic transmission and (ii) that the
foregoing notice may be sent to such e-mail address.

          (f) Nothing herein shall prejudice the right of the Administrative Agent
or any Bank to give any notice or other communication pursuant to this
Agreement in any other manner specified herein.

§23. MISCELLANEOUS. The rights and remedies herein expressed are
cumulative and not exclusive of any other rights which the Banks, the Issuing
Banks or the Administrative Agent would otherwise have. The captions in this
Agreement are for convenience of reference only and shall not define or limit
the provisions hereof. This Agreement and any amendment hereof may be executed
in several counterparts and by each party on a separate counterpart, each of
which

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when so executed and delivered shall be an original, but all of which
together shall constitute one instrument. In proving this Agreement it shall
not be necessary to produce or account for more than one such counterpart signed by the party against whom enforcement is
sought. This Agreement, to the extent signed and delivered by means of a
facsimile machine, shall be treated in all manner and respects as an original
agreement or instrument and shall be considered to have the same binding legal
effect as if it were the original signed version thereof delivered in person.
At the request of any party hereto, each other party hereto shall re-execute
original forms thereof and deliver them to all other parties. No party hereto
shall raise the use of a facsimile machine to deliver a signature or the fact
that any signature or agreement or instrument was transmitted or communicated
through the use of a facsimile machine as a defense to the formation of a
contract and each party forever waives such defense.

§24. CONSENTS, ETC. Neither this Agreement nor any term hereof may be
changed, waived, discharged or terminated, except as provided in this §24,
subject to the provisions of §15.9. No waiver shall extend to or affect any
obligation not expressly waived or impair any right consequent thereon. Except
as otherwise expressly provided in this Agreement, any consent or approval
required or permitted by this Agreement to be given by the Banks may be given,
and any term of this Agreement or of any other instrument related hereto or
mentioned herein may be amended, and the performance or observance by the
Borrower or the Guarantor of any terms of this Agreement or such other
instrument or the continuance of any Default or Event of Default may be waived
(either generally or in a particular instance and either retroactively or
prospectively) with, but only with, the written consent of the Borrower and the
Majority Banks. To the extent permitted by law, no course of dealing or delay
or omission on the part of any of the Banks, the Issuing Banks or the
Administrative Agent in exercising any right shall operate as a waiver thereof
or otherwise be prejudicial thereto. No notice to or demand upon the Borrower
or the Guarantor shall entitle the Borrower to other or further notice or
demand in similar or other circumstances.

§25. WAIVER OF JURY TRIAL. TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH OF
THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO A JURY TRIAL
WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF ANY DISPUTE IN CONNECTION
WITH THIS AGREEMENT, THE NOTES OR ANY OF THE OTHER LOAN DOCUMENTS, ANY RIGHTS
OR OBLIGATIONS HEREUNDER OR THEREUNDER OR THE PERFORMANCE OF SUCH RIGHTS AND
OBLIGATIONS. EXCEPT AS PROHIBITED BY LAW, THE BORROWER AND THE GUARANTOR HEREBY
WAIVE ANY RIGHT EITHER OF THEM MAY HAVE TO CLAIM OR RECOVER IN ANY LITIGATION
REFERRED TO IN THE PRECEDING SENTENCE ANY SPECIAL, EXEMPLARY, PUNITIVE OR
CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL
DAMAGES. THE BORROWER AND THE GUARANTOR EACH (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY BANK, ANY ISSUING BANK, THE
ADMINISTRATIVE AGENT OR ANY AGENT HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT
SUCH BANK, SUCH ISSUING BANK, THE ADMINISTRATIVE AGENT OR SUCH AGENT WOULD NOT,
IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVERS AND (B) ACKNOWLEDGES THAT THE ADMINISTRATIVE AGENT, THE BANKS, AND THE
ISSUING BANKS HAVE BEEN INDUCED TO ENTER INTO THIS

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AGREEMENT AND THE OTHER LOAN
DOCUMENTS BECAUSE OF, AMONG OTHER THINGS, THE BORROWER’S AND THE GUARANTOR’S
WAIVERS AND CERTIFICATIONS CONTAINED HEREIN.

§26. GOVERNING LAW; SUBMISSION TO JURISDICTION. THIS AGREEMENT AND EACH
OF THE OTHER LOAN DOCUMENTS ARE CONTRACTS UNDER THE LAWS OF THE STATE OF NEW
YORK AND SHALL, PURSUANT TO NEW YORK GENERAL OBLIGATIONS LAW §5-1401, BE
CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.
THE BORROWER AND THE GUARANTOR CONSENT AND AGREE THAT ANY SUIT FOR THE
ENFORCEMENT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS MAY BE BROUGHT
IN THE COURTS OF THE STATE OF NEW YORK OR ANY FEDERAL COURT SITTING THEREIN AND
CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF SUCH COURT AND SERVICE OF PROCESS
IN ANY SUCH SUIT BEING MADE UPON THE BORROWER IN ACCORDANCE WITH LAW AT THE
ADDRESS SPECIFIED IN §22. THE BORROWER AND THE GUARANTOR HEREBY WAIVE ANY
OBJECTION THAT THEY MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH SUIT OR
ANY SUCH COURT OR THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT FORUM.

§27. SEVERABILITY. The provisions of this Agreement are severable and if
any one clause or provision hereof shall be held invalid or unenforceable in
whole or in part in any jurisdiction, then such invalidity or unenforceability
shall affect only such clause or provision, or part thereof, in such
jurisdiction, and shall not in any manner affect such clause or provision in
any other jurisdiction, or any other clause or provision of this Agreement in
any jurisdiction.

§28. GUARANTY.

          §28.1. Guaranty. For value received and hereby acknowledged and as an
inducement to the Banks and the Issuing Banks to make the Loans available to
the Borrower, and issue, extend or renew Letters of Credit for the account of
the Borrower, the Guarantor hereby unconditionally and irrevocably guarantees
(a) the full punctual payment when due, whether at stated maturity, by
acceleration or otherwise, of all Obligations of the Borrower now or hereafter
existing whether for principal, interest, fees, expenses or otherwise, and (b)
the strict performance and observance by the Borrower of all agreements,
warranties and covenants applicable to the Borrower in the Loan Documents and
(c) the obligations of the Borrower under the Loan Documents (such Obligations
collectively being hereafter referred to as the “Guaranteed Obligations”).

          §28.2. Guaranty Absolute. The Guarantor guarantees that the Guaranteed Obligations will be paid
strictly in accordance with the terms hereof, regardless of any law, regulation
or order now or hereafter in effect in any jurisdiction affecting any of such
terms or the rights of any Bank, any Issuing Bank or the Administrative Agent
with respect thereto. The liability of the Guarantor under the guaranty granted
under this Agreement with regard to the Guaranteed Obligations shall be
absolute and unconditional irrespective of:

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          (a) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Guaranteed Obligations or any other
amendment or waiver of or any consent to departure from this Agreement or
any other Loan Document (with regard to such Guaranteed Obligations);

          (b) any release or amendment or waiver of or consent to departure
from any other guaranty for all or any of its Guaranteed Obligations;

          (c) any change in ownership of the Borrower;

          (d) any acceptance of any partial payment(s) from the Borrower or the
Guarantor; or

          (e) any other circumstance whatsoever which might otherwise
constitute a defense available to, or a discharge of, a guarantor or
surety or the Borrower in respect of its Obligations under any Loan
Document.

     The guaranty under this Agreement shall continue to be effective or be
reinstated, as the case may be, if at any time any payment of any Guaranteed
Obligation is rescinded or must otherwise be returned by the Banks, the Issuing
Banks or the Administrative Agent upon the insolvency, bankruptcy or
reorganization of the Borrower or otherwise, all as though such payment had not
been made.

          §28.3. Effectiveness; Enforcement. The guaranty under this Agreement
shall be effective and shall be deemed to be made with respect to each Loan and
each Letter of Credit as of the time it is made, issued or extended, or becomes
a Letter of Credit under this Agreement, as applicable. No invalidity,
irregularity or unenforceability by reason of any bankruptcy or similar law, or
any law or order of any government or agency thereof purporting to reduce,
amend or otherwise affect any liability of the Borrower, and no defect in or
insufficiency or want of powers of the Borrower or irregular or improperly
recorded exercise thereof, shall impair, affect, be a defense to or claim
against such guaranty. The guaranty under this Agreement is a continuing
guaranty and shall (a) survive any termination of this Agreement, and (b)
remain in full force and effect until payment in full of, and performance of,
all Guaranteed Obligations and all other amounts payable under this Agreement.
The guaranty under this Agreement is made for the benefit of the Administrative
Agent, the Issuing Banks and the Banks and their successors and assigns, and
may be enforced from time to time as often as occasion therefor may arise and
without requirement on the part of the Administrative Agent, the Issuing Banks
or the Banks first to exercise any rights against the Borrower, or to resort to
any other source or means of obtaining payment of any of the said obligations
or to elect any other remedy.

          §28.4. Waiver. Except as otherwise specifically provided in any of the
Loan Documents, the Guarantor hereby waives promptness, diligence, protest,
notice of protest, all suretyship defenses, notice of acceptance and any other
notice with respect to any of its Guaranteed Obligations and the guaranty under
this Agreement and any requirement that the Banks, the Issuing Banks or the
Administrative Agent protect, secure, perfect any security interest or Lien or
any property subject thereto or exhaust any right or take any action against
the Borrower or any other Person. The Guarantor also irrevocably waives, to the
fullest extent

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permitted by law, all defenses which at any time may be
available to it in respect of its Guaranteed Obligations by virtue of any
statute of limitations, valuation, stay, moratorium law or other similar law
now or hereafter in effect.

          §28.5. Expenses. The Guarantor hereby promises to reimburse (a) the
Administrative Agent for all reasonable out-of-pocket fees and disbursements
(including all reasonable attorneys’ fees), incurred or expended in connection
with the preparation, filing or recording, or interpretation of the guaranty
under this Agreement, the other Loan Documents or any amendment, modification,
approval, consent or waiver hereof or thereof, and (b) the Administrative
Agent, the Issuing Banks and the Banks and their respective affiliates for all
reasonable out-of-pocket fees and disbursements (including reasonable
attorneys’ fees), incurred or expended in connection with the enforcement of
its Guaranteed Obligations (whether or not legal proceedings are instituted).
The Guarantor will pay any taxes (including any interest and penalties in
respect thereof) other than the Banks’ taxes based on overall income or
profits, payable on or with respect to the transactions contemplated by the
guaranty under this Agreement, the Guarantor hereby agreeing jointly and
severally to indemnify each Bank with respect thereto.

          §28.6. Concerning Joint and Several Liability of the Guarantor.

          (a) The Guarantor hereby irrevocably and unconditionally accepts, not
merely as a surety but also as a co-debtor, joint and several liability
with the Borrower, with respect to the payment and performance of all of
its Guaranteed Obligations (including, without limitation, any Guaranteed
Obligations arising under this §28), it being the intention of the parties
hereto that all such Guaranteed Obligations shall be the joint and several
Guaranteed Obligations of the Guarantor and the Borrower without
preferences or distinction among them.

          (b) If and to the extent that the Borrower shall fail to make any
payment with respect to any of its Obligations as and when due or to
perform any of its Guaranteed Obligations in accordance with the terms
thereof, then in each such event the Guarantor will make such payment with
respect to, or perform, such Guaranteed Obligation.

          (c) The Guaranteed Obligations of the Guarantor under the provisions
of this §28 constitute full recourse obligations of the Guarantor
enforceable against the Guarantor to the full extent of its properties and assets,
irrespective of the validity, regularity or enforceability of this
Agreement or any other circumstance whatsoever.

          (d) Except as otherwise expressly provided in this Agreement, the
Guarantor hereby waives notice of acceptance of its joint and several
liability, notice of any Loans made, or Letters of Credit issued under
this Agreement, notice of any action at any time taken or omitted by the
Administrative Agent, the Issuing Banks or the Banks under or in respect
of any of the Guaranteed Obligations, and, generally, to the extent
permitted by applicable law, all demands, notices and other formalities of
every kind in connection with this Agreement. The Guarantor hereby assents
to, and waives notice of, any extension or postponement of the time for
the payment of any of the Guaranteed Obligations, the acceptance of any
payment of any of the Guaranteed Obligations, the

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acceptance of any
partial payment thereon, any waiver, consent or other action or
acquiescence by the Administrative Agent, the Issuing Banks or the Banks
at any time or times in respect of any Default or Event of Default by the
Borrower or the Guarantor in the performance or satisfaction of any term,
covenant, condition or provision of this Agreement or any other Loan
Document, any and all other indulgences whatsoever by the Administrative
Agent, the Issuing Banks or the Banks in respect of any of the Guaranteed
Obligations, and the taking, addition, substitution or release, in whole
or in part, at any time or times, of any security for any of the
Guaranteed Obligations or the addition, substitution or release, in whole
or in part, of the Borrower or the Guarantor. Without limiting the
generality of the foregoing, the Guarantor assents to any other action or
delay in acting or failure to act on the part of the Banks, the Issuing
Banks or the Administrative Agent with respect to the failure by the
Borrower or the Guarantor to comply with its respective Obligations or
Guaranteed Obligations, including, without limitation, any failure
strictly or diligently to assert any right or to pursue any remedy or to
comply fully with applicable laws or regulations thereunder, which might,
but for the provisions of this §28, afford grounds for terminating,
discharging or relieving the Guarantor, in whole or in part, from any of
the Guaranteed Obligations under this §28, it being the intention of the
Guarantor that, so long as any of the Guaranteed Obligations hereunder
remain unsatisfied, the Guaranteed Obligations of the Guarantor under this
§28 shall not be discharged except by performance and then only to the
extent of such performance. The Guaranteed Obligations of the Guarantor
under this §28 shall not be diminished or rendered unenforceable by any
winding up, reorganization, arrangement, liquidation, reconstruction or
similar proceeding with respect to the Borrower or the Guarantor or the
Banks, the Issuing Banks or the Administrative Agent. The joint and
several liability of the Guarantor hereunder shall continue in full force
and effect notwithstanding any absorption, merger, consolidation,
amalgamation or any other change whatsoever in the name, membership,
constitution or place of formation of the Borrower or the Guarantor, the
Banks, the Issuing Banks or the Administrative Agent.

          (e) The Guarantor shall be liable under this §28 only for the maximum
amount of such liabilities that can be incurred under applicable law
without rendering this §28 voidable under applicable law relating to
fraudulent conveyance and fraudulent transfer, and not for any greater
amount. Accordingly, if any obligation under any provision under this §28
shall be declared to be invalid or unenforceable in any respect or to any
extent, it is the stated intention and agreement of the Guarantor, the
Administrative Agent, the Issuing Banks and the Banks that any balance of the
obligation created by such provision and all other obligations of the
Guarantor under this §28 to the Banks, the Issuing Banks or the
Administrative Agent shall remain valid and enforceable, and that all sums
not in excess of those permitted under applicable law shall remain fully
collectible by the Banks, the Issuing Banks and the Administrative Agent
from the Borrower or the Guarantor, as the case may be.

          (f) The provisions of this §28 are made for the benefit of the
Administrative Agent, the Issuing Banks and the Banks and their successors
and assigns, and may be enforced in good faith by them from time to time
against the Guarantor as often as occasion therefor may arise and without
requirement on the part of the Administrative Agent, the Issuing Banks or
the Banks first to marshal any of

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their claims or to exercise any of their
rights against the Borrower or the Guarantor or to exhaust any remedies
available to them against the Borrower or the Guarantor or to resort to
any other source or means of obtaining payment of any of the obligations
hereunder or to elect any other remedy. The provisions of this §28 shall
remain in effect until all of the Guaranteed Obligations shall have been
paid in full or otherwise fully satisfied and the Commitments have expired
and all outstanding Letters of Credit have expired, matured or otherwise
been terminated. If at any time, any payment, or any part thereof, made in
respect of any of the Guaranteed Obligations, is rescinded or must
otherwise be restored or returned by the Banks, the Issuing Banks or the
Administrative Agent upon the insolvency, bankruptcy or reorganization of
the Borrower or the Guarantor, or otherwise, the provisions of this §28
will forthwith be reinstated in effect, as though such payment had not
been made.

          §28.7. Waiver. Until the final payment and performance in full of all of
the Obligations, the Guarantor shall not exercise and the Guarantor hereby
waives any rights the Guarantor may have against the Borrower arising as a
result of payment by the Guarantor hereunder, by way of subrogation,
reimbursement, restitution, contribution or otherwise, and will not prove any
claim in competition with the Administrative Agent, the Issuing Banks or any
Bank in respect of any payment hereunder in any bankruptcy, insolvency or
reorganization case or proceedings of any nature; the Guarantor will not claim
any setoff, recoupment or counterclaim against the Borrower in respect of any
liability of the Borrower to the Guarantor; and the Guarantor waives any
benefit of and any right to participate in any collateral security which may be
held by the Administrative Agent, the Issuing Banks or any Bank.

          §28.8. Subrogation; Subordination. The payment of any amounts due with
respect to any indebtedness of the Borrower for money borrowed or credit
received now or hereafter owed to the Guarantor is hereby subordinated to the
prior payment in full of all of the Obligations. The Guarantor agrees that,
after the occurrence of any default in the payment or performance of any of the
Obligations, the Guarantor will not demand, sue for or otherwise attempt to
collect any such indebtedness of the Borrower to the Guarantor until all of the
Obligations shall have been paid in full. If, notwithstanding the foregoing
sentence, the Guarantor shall collect, enforce or receive any amounts in respect of such indebtedness while any Obligations are still
outstanding, such amounts shall be collected, enforced and received by the
Guarantor as trustee for the Banks, the Issuing Banks and the Administrative
Agent and be paid over to the Administrative Agent at Default, for the benefit
of the Banks, the Issuing Banks, and the Administrative Agent on account of the
Obligations without affecting in any manner the liability of the Guarantor
under the other provisions hereof.

§29. PARI PASSU TREATMENT.

          (a) Notwithstanding anything to the contrary set forth herein, each
payment or prepayment of principal and interest received after the occurrence
of an Event of Default hereunder shall be distributed pari passu among the
Banks, in accordance with the aggregate outstanding principal amount of the
Obligations owing to each Bank divided by the aggregate outstanding principal
amount of all Obligations.

- 77 -

 

          (b) Each Bank agrees that if it shall, through the exercise of a right of
banker’s lien, setoff or counterclaim against any Borrower (pursuant to §13 or
otherwise), including a secured claim under Section 506 of the Bankruptcy Code
or other security or interest arising from or in lieu of, such secured claim,
received by such Bank under any applicable bankruptcy, insolvency or other
similar law or otherwise, obtain payment (voluntary or involuntary) in respect
of the Notes, Loans, Reimbursement Obligations and other Obligations held by it
(other than pursuant to §5.5, §5.6 or §5.8) as a result of which the unpaid
principal portion of the Notes and the Obligations held by it shall be
proportionately less than the unpaid principal portion of the Notes and the
Obligations held by any other Bank, it shall be deemed to have simultaneously
purchased from such other Bank a participation in the Notes and the Obligations
held by such other Bank, so that the aggregate unpaid principal amount of the
Notes and the Obligations and participations in Notes and Obligations held by
each Bank shall be in the same proportion to the aggregate unpaid principal
amount of the Notes and the Obligations then outstanding as the principal
amount of the Notes and the Obligations held by it prior to such exercise of
banker’s lien, setoff or counterclaim was to the principal amount of all Notes
and Obligations outstanding prior to such exercise of banker’s lien, setoff or
counterclaim; provided, however, that if any such purchase or purchases or
adjustments shall be made pursuant to this §29 and the payment giving rise
thereto shall thereafter be recovered, such purchase or purchases or
adjustments shall be rescinded to the extent of such recovery and the purchase
price or prices or adjustments restored without interest. The Borrower
expressly consents to the foregoing arrangements and agrees that any Person
holding such a participation in the Obligations deemed to have been so
purchased may exercise any and all rights of banker’s lien, setoff or
counterclaim with respect to any and all moneys owing by the Borrower to such
Person as fully as if such Person had made a Loan directly to the Borrower in
the amount of such participation.

§30. FINAL AGREEMENT. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED
BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

§31. USA PATRIOT ACT. Each 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 to identify the Borrower in accordance with the Act.

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     IN WITNESS WHEREOF, the undersigned have duly executed this Agreement as
of the date first set forth above.

	 	 	 	 	 
	 	THE BORROWER AND GUARANTOR:

WASTE MANAGEMENT, INC.

 	 
	 	By:  	   /s/ Cherie C. Rice
 	 
	 	 	Name:  	Cherie C. Rice 	 
	 	 	Title:  	Vice President - Finance and Treasurer 	 
	 

	 	 	 	 	 
	 

	WASTE MANAGEMENT HOLDINGS, INC.

 	 
	 	By:  	   /s/ Cherie C. Rice
 	 
	 	 	Name:  	Cherie C. Rice 	 
	 	 	Title:  	Vice President and Treasurer 	 
	 

	 	 	 	 	 
	 	 	 
	 	By:  	                                       /s/ Amanda K. Maki
 	 
	 	 	Name:  	Amanda K. Maki 	 
	 	 	Title:  	Assistant Secretary 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	THE ADMINISTRATIVE AGENT:

CITIBANK, N.A., as Administrative Agent

 	 
	 	By:  	   /s/ Carolyn A. Kee
 	 
	 	 	Name:  	Carolyn A. Kee 	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	THE BANKS:

JPMORGAN CHASE BANK

 	 
	 	By:  	   /s/ Robert T. Sacks
 	 
	 	 	Name:  	Robert T. Sacks 	 
	 	 	Title:  	Managing Director 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	FLEET NATIONAL BANK

 	 
	 	By:  	   /s/ Maria F. Maia
 	 
	 	 	Name:  	Maria F. Maia 	 
	 	 	Title:  	Managing Director 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	CITIBANK, N.A.

 	 
	 	By:  	   /s/ Carolyn A. Kee
 	 
	 	 	Name:  	Carolyn A. Kee 	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	BARCLAYS BANK PLC

 	 
	 	By:  	   /s/ Nicholas Bell
 	 
	 	 	Name:  	Nicholas Bell 	 
	 	 	Title:  	Director 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	DEUTSCHE BANK AG, NEW YORK BRANCH

 	 
	 	By:  	   /s/ Jean Hannigan
 	 
	 	 	Name:  	Jean Hannigan 	 
	 	 	Title:  	Director 	 
	 

	 	 	 	 	 
	 	 	 
	 	By:  	                                       /s/ Oliver Riedinger
 	 
	 	 	Name:  	Oliver Riedinger 	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	ABN AMRO BANK N.V.

 	 
	 	By:  	   /s/ Terrence J. Ward
 	 
	 	 	Name:  	Terrence J. Ward 	 
	 	 	Title:  	Senior Vice President 	 
	 

	 	 	 	 	 
	 	 	 
	 	By:  	                                       /s/ Ignacio Pineros
 	 
	 	 	Name:  	Ignacio Pineros 	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	BNP PARIBAS

 	 
	 	By:  	   /s/ John Stacy
 	 
	 	 	Name:  	John Stacy 	 
	 	 	Title:  	Managing Director 	 
	 

	 	 	 	 	 
	 	 	 
	 	By:  	                                       /s/ Aurora L. Abella
 	 
	 	 	Name:  	Aurora Abella 	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	THE BANK OF NOVA SCOTIA

 	 
	 	By:  	   /s/ William E. Zarrett
 	 
	 	 	Name:  	William E. Zarrett 	 
	 	 	Title:  	Managing Director 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	CALYON, NEW YORK BRANCH

 	 
	 	By:  	   /s/ F. Frank Herrera
 	 
	 	 	Name:  	F. Frank Herrera 	 
	 	 	Title:  	Director 	 
	 

	 	 	 	 	 
	 	 	 
	 	By:  	                                       /s/ Gill Realon
 	 
	 	 	Name:  	Gill Realon 	 
	 	 	Title:  	Director 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	PNC BANK, NATIONAL ASSOCIATION

 	 
	 	By:  	   /s/ Phillip K. Liebscher
 	 
	 	 	Name:  	Phillip K. Liebscher 	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	SUNTRUST BANK

 	 
	 	By:  	   /s/ Daniel S. Komitor
 	 
	 	 	Name:  	Daniel S. Komitor 	 
	 	 	Title:  	Director 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	THE ROYAL BANK OF SCOTLAND PLC

 	 
	 	By:  	   /s/ Philippe Sandmeier
 	 
	 	 	Name:  	Philippe Sandmeier 	 
	 	 	Title:  	Senior Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	WACHOVIA BANK, N.A.

 	 
	 	By:  	   /s/ John G. Taylor
 	 
	 	 	Name:  	John G. Taylor 	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	BAYERISCHE HYPO- UND VEREINSBANK AG, NEW
YORK BRANCH

 	 
	 	By:  	   /s/ Yoram Dankner
 	 
	 	 	Name:  	Yoram Dankner 	 
	 	 	Title:  	Managing Director 	 
	 

	 	 	 	 	 
	 	 	 
	 	By:  	                                       /s/ Richard Cordover
 	 
	 	 	Name:  	Richard Cordover 	 
	 	 	Title:  	Director 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	COMERICA BANK

 	 
	 	By:  	   /s/ Kenyatta B. Gibbs
 	 
	 	 	Name:  	Kenyatta B. Gibbs 	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	KEYBANK NATIONAL ASSOCIATION

 	 
	 	By:  	   /s/ Brendan A. Lawlor
 	 
	 	 	Name:  	Brendan A. Lawlor 	 
	 	 	Title:  	Senior Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	MIZUHO CORPORATE BANK, LTD.

 	 
	 	By:  	   /s/ Greg Botshon
 	 
	 	 	Name:  	Greg Botshon 	 
	 	 	Title:  	Senior Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	SUMITOMO MITSUI BANKING CORPORATION

 	 
	 	By:  	   /s/ Edward McColly
 	 
	 	 	Name:  	Edward McColly 	 
	 	 	Title:  	Vice President & Department Head 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	CREDIT SUISSE FIRST BOSTON

acting through its Cayman Islands Branch

 	 
	 	By:  	   /s/ Phillip Ho
 	 
	 	 	Name:  	Phillip Ho 	 
	 	 	Title:  	Director 	 
	 

	 	 	 	 	 
	 	 	 
	 	By:  	                                       /s/ Mikhail Faybusovich
 	 
	 	 	Name:  	Mikhail Faybusovich 	 
	 	 	Title:  	Associate 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	MELLON BANK, N.A.

 	 
	 	By:  	   /s/ Lawrence C. Ivey
 	 
	 	 	Name:  	Lawrence C. Ivey 	 
	 	 	Title:  	First Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	MERRILL LYNCH BANK USA

 	 
	 	By:  	   /s/ Frank K. Stepan
 	 
	 	 	Name:  	Frank K. Stepan 	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	THE BANK OF NEW YORK

 	 
	 	By:  	   /s/ David T. Sunderwirth
 	 
	 	 	Name:  	David T. Sunderwirth 	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	UFJ BANK LIMITED

 	 
	 	By:  	   /s/ John T. Feeney
 	 
	 	 	Name:  	John T. Feeney 	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	UNION PLANTERS BANK, N.A.

 	 
	 	By:  	   /s/ Carol S. Geraghty
 	 
	 	 	Name:  	Carol S. Geraghty 	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	WILLIAM STREET CREDIT CORPORATION

 	 
	 	By:  	   /s/ Jennifer M. Hill
 	 
	 	 	Name:  	Jennifer M. Hill 	 
	 	 	Title:  	Chief Financial Officer 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	KBC BANK N.V.

 	 
	 	By:  	   /s/ Robert Snauffer
 	 
	 	 	Name:  	Robert Snauffer 	 
	 	 	Title:  	First Vice President 	 
	 

	 	 	 	 	 
	 	 	 
	 	By:  	                                       /s/ Eric Raskin
 	 
	 	 	Name:  	Eric Raskin 	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	THE NORINCHUKIN BANK

 	 
	 	By:  	   /s/ Masanori Shoji
 	 
	 	 	Name:  	Masanori Shoji 	 
	 	 	Title:  	Joint General Manager 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	BANK OF TAIWAN

 	 
	 	By:  	   /s/ Eunice Shiou-Jsu Yeh
 	 
	 	 	Name:  	Eunice Shio-Jsu Yeh 	 
	 	 	Title:  	SVP & GM 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	THE BANK OF TOKYO MITSUBISHI, LTD.

 	 
	 	By:  	   /s/ Joey Powell
 	 
	 	 	Name:  	Joey Powell 	 
	 	 	Title:  	Assistant Vice President 	 
	 

	 	 	 	 	 
	 	 	 
	 	By:  	                                       /s/ Doug Barnell
 	 
	 	 	Name:  	Doug Barnell 	 
	 	 	Title:  	Vice President & Manager 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	US BANK NATIONAL ASSOCIATION

 	 
	 	By:  	   /s/ John Holland
 	 
	 	 	Name:  	John Holland 	 
	 	 	Title:  	Senior Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	CATHAY UNITED

 	 
	 	By:  	   /s/ Allen Y.L. Peng
 	 
	 	 	Name:  	Allen Y.L. Peng 	 
	 	 	Title:  	EVP & General Manager 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	BANK OF COMMUNICATIONS

 	 
	 	By:  	   /s/ Hong Tu
 	 
	 	 	Name:  	Hong Tu 	 
	 	 	Title:  	General Manager 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	FIRST COMMERCIAL BANK

 	 
	 	By:  	   /s/ Bruce M. J. Ju
 	 
	 	 	Name:  	Bruce M. J. Ju 	 
	 	 	Title:  	VP & General Manager 	 
	 

 

 

EXHIBIT A

FORM OF SYNDICATED LOAN REQUEST

WASTE MANAGEMENT, INC.

Revolving Credit Agreement

(the “Credit Agreement) dated as of October 15, 2004

	 	 	 	 	 
	Syndicated Loan Request under Section 2.6(a)
	 	 	 	 
	 
	 	 	 	 
	Total Commitment	 	

	 
	 	 	 	 
	Loans outstanding	 	

	 
	 	 	 	 
	Amount of this Request	 	

	 
	 	 	 	 
	Maximum Drawing Amount of outstanding	 	

	    Letters of Credit
	 	 	 	 
	 
	 	 	 	 
	    Canadian dollar component

	 	C$
	 	

	 
	 	 	 	 
	    US dollar equivalent of C$ component

	 	US$
	 	

	 
	 	 	 	 
	Total of all outstanding and requested Loans plus	 	

	    Maximum Drawing Amount of all outstanding
	 	 	 	 
	    Letters of Credit plus Amount of this Request
	 	 	 	 
	    (must not exceed Total Commitment)
	 	 	 	 
	 
	 	 	 	 
	Proposed Drawdown Date	 	

	 
	 	 	 	 
	Interest Rate Option (Base Rate or Eurodollar)	 	

	 
	 	 	 	 
	Interest Period (if Eurodollar)	 	

	 
	 	 	 	 
	Conversion under Section 2.7
	 	 	 	 
	 
	 	 	 	 
	Amount to be converted from Eurodollar to Base	 	

	    Rate:
	 	 	 	 
	 
	 	 	 	 
	Amount to be converted from Base Rate to	 	

	    Eurodollar:
	 	 	 	 
	 
	 	 	 	 
	Amount to be maintained as Eurodollar Loan	 	

	 
	 	 	 	 
	Conversion Date	 	

	 
	 	 	 	 
	Interest Period (if Eurodollar)	 	

 

 

     I certify that the above is true and correct, and that all of the
conditions set forth in §11 of the Credit Agreement have been satisfied as of
the date hereof.

	 	 	 	 	 	 	 
	 	 	WASTE MANAGEMENT, INC.
	 
	 	 	 	 	 	 
	 	 	By:	 	

	

	 	 	 	Name:	 	 
	

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	

Date

 

 

EXHIBIT B

FORM OF LETTER OF CREDIT REQUEST

WASTE MANAGEMENT, INC.

Revolving Credit Agreement

(the “Credit Agreement”) dated as of October 15, 2004

	 	 	 
	Letter of Credit Request Under Section 3.1
	 	 
	 
	 	 
	Total Commitment

	 	

	 
	 	 
	Maximum Drawing Amount of Letters of Credit

	 	

	    outstanding
	 	 
	 
	 	 
	Amount of this Request from Letter of Credit
	 	 
	    Application (attached)

	 	

	 
	 	 
	    — U.S. Dollars

	 	

	 
	 	 
	    — Canadian Dollars

	 	

	 
	 	 
	Loans Outstanding

	 	

	 
	 	 
	Maximum Drawing Amount of all outstanding and

	 	

	    Requested Letters of Credit
	 	 
	    (must not exceed the Total Commitment minus Total of
	 	 
	    all Loans outstanding)
	 	 

     I certify that the above is true and correct, and that all of the
conditions set forth in §11 of the Credit Agreement have been satisfied as of
the date hereof.

	 	 	 	 	 	 	 
	 	 	WASTE MANAGEMENT, INC.
	 
	 	 	 	 	 	 
	 	 	By:	 	

	

	 	 	 	Name:	 	 
	

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	

	

	 	 	 	 	 	Date

 

 

EXHIBIT C

FORM OF COMPLIANCE CERTIFICATE

WASTE MANAGEMENT, INC.

Compliance Certificate dated                    

I,                                      , [Chief Financial Officer] [Chief Accounting Officer]
[Corporate Treasurer] of WASTE MANAGEMENT, INC. (the “Borrower”) certify that
no Default or Event of Default exists and that the Borrower is in compliance
with Sections 7, 8 & 9 of the Revolving Credit Agreement dated as of October
15, 2004 (as amended, modified, supplemented, restated and in effect from time
to time, the “Credit Agreement”), [as of the end of the quarter ended
                   ]. Computations to evidence compliance with §9 of the Credit Agreement
are detailed below. Capitalized terms used herein without definition shall
have the meanings assigned to such terms in the Credit Agreement.

	 	 	 	 	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

§9.1 Interest Coverage Ratio

	 	 	 
	Consolidated Net Income (or Deficit)
	 	$                                      (i)
	  Plus (without duplication):
	 	 
	    interest expense

	 	$                                      (ii)
	    equity in losses (earnings) of

	 	
	      unconsolidated entities

	 	$                                      (iii)
	    income tax expense

	 	$                                      (iv)
	    non-cash writedowns or writeoffs of assets

	 	$                                      (v)
	Minus non-cash extraordinary gains on the sale of assets

	 	$                                      (vi)
	 
	 	 
	EBIT (sum of (i) through (v))

	 	$                                      (a)
	 
	 	 
	Consolidated Net Income of Acquired Businesses
	 	$                                      (i)
	  Plus (without duplication):
	 	 
	    interest expense

	 	$                                      (ii)
	    equity in losses (earnings) of

	 	
	      unconsolidated entities

	 	$                                      (iii)
	    income tax expense

	 	$                                      (iv)
	    non-cash writedowns or write-offs of assets

	 	$                                      (v)
	    non-recurring extraordinary charges
	 	$                                      (vi)
	 
	 	 
	EBIT of Acquired Businesses (sum of (i) through (vi)

	 	$                                      (b)
	 
	 	 
	Sum of (a) plus (b)

	 	$                                      (c)

 

 

	 	 	 
	Consolidated Total Interest Expense

	 	$                                      (d)
	 
	 	 
	Ratio of (c) to (d)

	 	                   :                   
	 
	 	 
	Minimum ratio

	 	2.75:1

§9.2 Total Debt to EBITDA

	 	 	 
	EBIT (from §9.1 item (c) above)

	 	$                                      (i)
	 
	 	 
	Plus:
	 	 
	  Depreciation expense

	 	$                                      (ii)
	  Amortization expense

	 	$                                      (iii)
	 
	 	 
	  EBITDA (sum of (i) through (iii))

	 	$                                      (iv)
	 
	 	 
	The sum of the following (calculated on a consolidated basis
	 	 
	for the Borrower and its Subsidiaries):
	 	 
	  Indebtedness for borrowed money

	 	$                                      (v)
	  Obligations for deferred purchase price of property or
	 	 
	    services (other than trade payables)

	 	$                                      (vi)
	  Obligations evidenced by debt instruments

	 	$                                      (vii)
	  Obligations under conditional sales

	 	$                                      (viii)
	  Obligations, liabilities and indebtedness under
	 	 
	    Capitalized Leases

	 	$                                      (ix)
	  Obligations, liabilities and indebtedness under
	 	 
	    bonding arrangements

	 	$                                      (x)
	  (to the extent that a surety has been called upon to
	 	 
	    make payment on a bond) Guaranties of the
	 	 
	    Indebtedness of others

	 	$                                      (xi)
	  Indebtedness secured by liens or encumbrances on
	 	 
	    property

	 	$                                      (xii)
	  Reimbursement obligations with respect to letters of
	 	 
	    credit

	 	$                                      (xiii)
	 
	 	 
	Total Debt (sum of v – xiv)

	 	$                                      (xiv)
	 
	 	 
	Ratio of (xv) to (iv)

	 	                   :                   
	 
	 	 
	  Maximum ratio:

	 	3.50:1.00

- 2 -

 

EXHIBIT D

FORM OF ASSIGNMENT AND ACCEPTANCE

Dated as of                                       ,                    

     Reference is made to the REVOLVING CREDIT AGREEMENT dated as of October
15, 2004 (as amended and in effect from time to time, the “Credit Agreement”),
by and among WASTE MANAGEMENT, INC., a Delaware corporation (the “Borrower”),
WASTE MANAGEMENT HOLDINGS, INC., a wholly-owned Subsidiary of the Borrower (the
“Guarantor”), certain Banks, and CITIBANK, N.A., as Administrative Agent (the
“Administrative Agent”). Capitalized terms used herein and not otherwise
defined shall have the meanings assigned to such terms in the Credit Agreement.

     [                                      ] (the “Assignor”) and [                                      ] (the “Assignee”)
hereby agree as follows:

     1. Assignment. Subject to the terms and conditions of this Assignment
and Acceptance, the Assignor hereby sells and assigns to the Assignee, and the
Assignee hereby purchases and assumes without recourse to the Assignor, the
rights, benefits, indemnities and obligations of the Assignor under the Credit
Agreement equal to                    % of its Commitment Percentage and                    % of its
interest in and under the Loans and the risk relating to outstanding Letters of
Credit, each as in effect immediately prior to the Effective Date (as
hereinafter defined).

     2. Assignor’s Representations. The Assignor (i) represents and warrants
that (A) it is legally authorized to enter into this Assignment and Acceptance,
(B) as of the date hereof, its Commitment is $                   , its Commitment
Percentage is                    %, and the aggregate outstanding principal balance of its
Loans equals $                   , and the aggregate outstanding amount of its
participations in Letters of Credit equals $                    (in each case before
giving effect to the assignment contemplated hereby or any contemplated
assignments which have not yet become effective), and (C) immediately after
giving effect to all assignments which have not yet become effective, the
Assignor’s Commitment Percentage will be sufficient to give effect to this
Assignment and Acceptance, (ii) makes no representations or warranty, express
or implied, and assumes and shall have no responsibility with respect to any
statements, warranties or representations made in or in connection with the
Credit Agreement or any of the other Loan Documents or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Credit
Agreement, the other Loan Documents or any other instrument or document
furnished pursuant thereto or the attachment, perfection or priority of any
security interest or mortgage, other than that it is the legal and beneficial
owner of the interest being assigned by it hereunder free and clear of any
claim or encumbrance; and (iii) makes no representation or warranty and assumes
and shall have no responsibility with respect to the financial condition of the
Borrower or any of its Subsidiaries or any other Person primarily or
secondarily liable in respect of any of the Obligations, or the performance or
observance by the Borrower or any of its Subsidiaries or any other Person
primarily or secondarily liable in respect of any of the Obligations of any of
its obligations under the Credit Agreement or any of the other Loan Documents
or any other instrument or document delivered or executed pursuant thereto.

 

 

     The Administrative Agent shall make the appropriate entries on the
applicable loan accounts to reflect the assignment of Loans.

     3. Assignee’s Representations. The Assignee (i) represents and warrants
that (A) it is duly and legally authorized to enter into this Assignment and
Acceptance, (B) the execution, delivery and performance of this Assignment and
Acceptance do not conflict with any provision of law or of the charter or
by-laws of the Assignee, or of any agreement binding on the Assignee, (C) all
acts, conditions and things required to be done and performed and to have
occurred prior to the execution, delivery and performance of this Assignment
and Acceptance, and to render the same the legal, valid and binding obligation
of the Assignee, enforceable against it in accordance with its terms, have been
done and performed and have occurred in due and strict compliance with all
applicable laws, (ii) confirms that it has received a copy of the Credit
Agreement and each of the other Loan Documents, together with copies of the
most recent financial statements delivered pursuant to §§6.4 and 7.4 of the
Credit Agreement and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment and Acceptance; (iii) agrees that it will, independently and without
reliance upon the Assignor, the Administrative Agent, or any other Bank and
based on such documents and information as it shall deem appropriate eat the
time, continue to make its own credit decisions in taking or not taking action
under the Credit Agreement and the other Loan Documents; (iv) appoints and
authorizes the Administrative Agent to take such action as agent on its behalf
and to exercise such powers under the Credit Agreement and the other Loan
Documents as are delegated to the Administrative Agent by the terms thereof,
together with such powers as are reasonably incidental thereto; (v) agrees that
it will perform in accordance with their terms all the obligations which by the
terms of the Credit Agreement are required to be performed by it as a Bank; and
(vi) acknowledges that it has made arrangements with the Assignor satisfactory
to the Assignee with respect to its pro rata share of Letter of Credit Fees in
respect of outstanding Letters of Credit.

     4. Effective Date. The effective date for this Assignment and Acceptance
shall be                                        (the “Effective Date”). Following the execution of this
Assignment and Acceptance, each party hereto shall deliver its duly executed
counterpart hereof to the Administrative Agent for acceptance by the
Administrative Agent. The Credit Agreement shall thereupon be amended to
reflect the status and rights of the Banks thereunder.

     5. Rights Under Credit Agreement. Upon such acceptance and amendment,
from and after the Effective Date, (i) the Assignee shall be a party to the
Credit Agreement and, to the extent provided in this Assignment and Acceptance,
have the rights and obligations of a Bank thereunder, and (ii) the Assignor
shall, with respect to that portion of its interest under the Credit Agreement
assigned hereunder, relinquish its rights and be released from its obligations
under the Credit Agreement; provided, however, that the Assignor shall retain
its rights to be indemnified pursuant to §16 of the Credit Agreement with
respect to any claims or actions with reference to matters arising prior to the
Effective Date.

     6. Payments. Upon such acceptance and amendment, from and after the
Effective Date, the Administrative Agent shall make all payments in respect of
the rights and interests assigned hereby (including payments of principal,
interest, fees and other amounts) to the Assignee. The Assignor and the
Assignee shall make any appropriate adjustments in payments for periods prior

- 2 -

 

to the Effective Date by the Administrative Agent or with respect to the
making of this assignment directly between themselves.

     7. Governing Law. THIS AGREEMENT AND ACCEPTANCE IS A CONTRACT UNDER THE
LAWS OF THE STATE OF NEW YORK AND SHALL, PURSUANT TO NEW YORK GENERAL
OBLIGATIONS LAW §5-1401, BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE
LAW OF THE STATE OF NEW YORK.

     8. Counterparts. This Assignment and Acceptance may be executed in any
number of counterparts which shall together constitute but one and the same
agreement.

     IN WITNESS WHEREOF, intending to be legally bound, each of the undersigned
has caused this Assignment and Acceptance to be executed on its behalf by its
officer thereunto duly authorized, as of the date first above written.

	 	 	 	 	 
	 	[ASSIGNOR]

 	 
	 	By:  	

 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

	 	 	 	 	 
	 	[ASSIGNEE]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

CONSENTED TO:

	 	 	 
	CITIBANK, N.A.,
	   as Administrative Agent
	 
	 	 
	By:  	 	 	 
	 	Name:  	 	 	 
	 	Title:  	 	 	 
	 
	 	 
	WASTE MANAGEMENT, INC.
	 
	 	 
	By:  	 	 	 
	 	Name:  	 	 	 
	 	Title:  	 	 	 

- 3 -

 

Waste Management Holdings, Inc. executes this Assignment and Acceptance solely
for purposes of ratifying their guaranty under §28 of the Credit Agreement.

WASTE MANAGEMENT HOLDINGS, INC.

	 	 	 
	By:

	 	

	

	 	Name:
	

	 	Title:

- 4 -

 

EXHIBIT E

FORM OF COMPETITIVE BID QUOTE REQUEST

WASTE MANAGEMENT, INC.

Revolving Credit Agreement

(the “Credit Agreement”) dated as of October 15, 2004

	 	 	 
	Competitive Bid Quote Request under Section 4.3
	 	 
	 
	 	 
	Total Commitment

	 	                                      
	 
	 	 
	Competitive Bid Loans Outstanding

	 	                                      
	Competitive Bid Loans Requested

	 	                                      
	Maximum Drawing Amount of outstanding Letters of Credit

	 	                                      
	Syndicated Loans (including Swing Line Loans) outstanding

	 	                                      
	 
	 	 
	Total
of all Outstanding and Requested Competitive Bid Loans (must
not exceed the lesser of the Total Commitment minus Total of all
Syndicated Loans outstanding (including Swing Line Loans) and Maximum
Drawing Amount of outstanding Letters of  Credit)
	 	                                      
	 
	 	 
	Type of Competitive Bid Loans Requested

	 	Eurodollar/Absolute
	 
	 	 
	Requested Drawdown Date

	 	                                      

	 	 	 
	Principal Amount of
	 	Requested
	Competitive Bid Loan Requested
	 	Interest Period(s)

I certify that the above is true and correct, and that all of the conditions
set forth in §11 of the Credit Agreement have been satisfied as of the date
hereof.

	 	 	 	 	 	 	 
	 	 	WASTE MANAGEMENT, INC.
	 
	 	 	 	 	 	 
	 	 	By:	 	

	

	 	Name:	 	 	 	 
	

	 	Title:	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	

Date

 

 

EXHIBIT F

WASTE MANAGEMENT, INC.

(the “Borrower”)

Revolving Credit Agreement

(the “Credit Agreement) dated as of October 15, 2004

FORM OF INVITATION FOR COMPETITIVE BID QUOTES

ATTN:

REF:

RE:       INVITATION FOR COMPETITIVE BID QUOTES

AGT DTD  /   /

CITIBANK, N.A., AS ADMINISTRATIVE AGENT INVITATION FOR COMPETITIVE BID QUOTES
DATED  /  /

PURSUANT TO SECTION 4.3 OF THE ABOVE REFERENCED CREDIT AGREEMENT, YOU ARE
INVITED TO SUBMIT A COMPETITIVE BID QUOTE TO THE BORROWER FOR THE FOLLOWING
PROPOSED COMPETITIVE BID LOAN(S)

DATE OF BORROWING:   /   /

AGGREGATE AMOUNT REQUESTED:

PRINCIPAL AMOUNT                   INTEREST PERIOD

SUCH COMPETITIVE BID QUOTES SHOULD OFFER COMPETITIVE BID RATE(S)/MARGIN(S).

PLEASE RESPOND IN WRITING TO THIS INVITATION BY NO LATER THAN                     A.M./P.M. (NE
YORK TIME ON   /   /   TO ONE OF THE FOLLOWING:

PRIMARY FAX NO. [                                       (Attn:                                      ) Confirm]

ALTERNATE FAX NO.
[           
                
          (Attn:     
                
               )
Confirm]

NOTE: PLEASE FOLLOW-UP YOUR SUBMITTED WRITTEN BID(S) WITH PHONE VERIFICATION
TO CONFIRM. IF YOU ARE UNABLE TO SEND YOUR FAX DUE TO AN OCCUPIED FAX LINE,
PLEASE CALL BY ___ A.M./P.M. IN ADDITION, PLEASE SUBMIT YOUR BID(S) IN
SUBSTANTIALLY THE FORM OF “EXHIBIT G” TO THE CREDIT AGREEMENT.

QUOTES RECEIVED AFTER                   A.M./P.M. (NEW YORK TIME) WILL NOT BE FORWARDED TO
THE BORROWER.

 

 

SUBMITTED BIDS MUST BE TEN MILLION DOLLARS OR LARGER MULTIPLE OF ONE MILLION
DOLLARS. ALSO, PLEASE SPECIFY LIMITATION AMOUNTS, IF APPLICABLE.

	 	 	 
	

	 	CITIBANK, N.A.,
	

	 	as Administrative Agent
	 
	 	 
	

	 	By:                                                             
	

	 	Name:                                                         
	

	 	Title:                                                           
	

	 	Date:                                                           

 

 

EXHIBIT G

FORM OF COMPETITIVE BID QUOTE

WASTE MANAGEMENT, INC.

Revolving Credit Agreement

(the “Credit Agreement”) dated as of October 15, 2004

	 	 	 
	Competitive Bid Quote under Section 4.5
	 	 
	 
	 	 
	Bank

	 	                                      
	Person to Contact

	 	                                      
	 
	 	 
	Date of Competitive Bid Quote Request

	 	                                      
	Type of Competitive Bid Loans Requested

	 	Eurodollar/Absolute
	Requested Drawdown Date

	 	                                      

	 	 	 	 	 
	Principal Amount	 	 	 	Proposed Competitive
	of Competitive	 	Requested	 	Bid Rate/Competitive
	Bid Loan Offered
	 	Interest Period(s)
	 	Bid Margin

I certify that the above is true and correct, and that the offer(s) set forth
above irrevocably obligates us to make such Competitive Bid Loan(s) if such
offer(s) is/are accepted by the Borrower and all of the conditions set forth in
§11 of the Credit Agreement have been satisfied as of the requested Drawdown
Date.

	 	 	 	 	 
	 	 	[NAME OF BANK]
	 
	 	 	 	 
	

	 	By:
	 	

	

	 	Name:
	 	

	

	 	Title:
	 	

	

	 	Date:
	 	

 

 

EXHIBIT H

FORM OF NOTICE OF ACCEPTANCE/REJECTION

OF COMPETITIVE BID QUOTE(S)

WASTE MANAGEMENT, INC.

Revolving Credit Agreement

(the “Credit Agreement”) dated as of October 15, 2004

Notice of Competitive Bid Quote(s) under Section 4.7

	 	 	 
	Date of Competitive Bid Quote Request

	 	                                      
	Type of Competitive Bid Loans Requested

	 	Eurodollar/Absolute
	Requested Drawdown Date

	 	                                      

We hereby accept the following Competitive Bid Quote(s):

	 	 	 	 	 	 	 
	Principal

Amount of Quotes

	 	Interest Period(s)

	 	Competitive

Rate/ Competitive

Bid Margin

	 	Bank

We hereby reject the following Competitive Bid Quote(s):

	 	 	 	 	 	 	 
	Principal

Amount of Quotes

	 	Interest Period(s)

	 	Competitive

Rate/ Competitive

Bid Margin

	 	Bank

 

 

     The accepted and rejected Competitive Bid Quotes described above
constitute all Competitive Bid Quotes submitted by the Banks in accordance with
§4.5 of the Credit Agreement.

	 	 	 	 	 
	 	 	WASTE MANAGEMENT, INC.
	 
	 	 	 	 
	

	 	By:
	 	

	

	 	Name:
	 	

	

	 	Title:
	 	

	Date:                                                         
	 	 	 	 

 

 

SCHEDULE 1

BANKS; COMMITMENTS

	 	 	 	 	 
	BANK
	 	COMMITMENT

	JPMorgan Chase Bank
	 	$	210,000,000	 
	Fleet National Bank
	 	$	200,000,000	 
	Citibank, N.A.
	 	$	170,000,000	 
	Barclays Bank PLC
	 	$	145,000,000	 
	Deutsche Bank AG, New York Branch
	 	$	145,000,000	 
	ABN AMRO Bank N.V.
	 	$	115,000,000	 
	BNP Paribas
	 	$	115,000,000	 
	The Bank of Nova Scotia
	 	$	115,000,000	 
	Calyon, New York Branch
	 	$	90,000,000	 
	PNC Bank, National Association
	 	$	90,000,000	 
	SunTrust Bank
	 	$	90,000,000	 
	The Royal Bank of Scotland plc
	 	$	90,000,000	 
	Wachovia Bank, N.A.
	 	$	90,000,000	 
	Bayerische Hypo- und Vereinsbank AG,
New York Branch
	 	$	55,000,000	 
	Comerica Bank
	 	$	55,000,000	 
	KeyBank National Association
	 	$	55,000,000	 
	Mizuho Corporate Bank, Ltd.
	 	$	55,000,000	 
	Sumitomo Mitsui Banking Corporation
	 	$	55,000,000	 
	Credit Suisse First Boston
	 	$	40,000,000	 
	Mellon Bank, N.A.
	 	$	40,000,000	 
	Merrill Lynch Bank USA
	 	$	40,000,000	 
	The Bank of New York
	 	$	40,000,000	 
	UFJ Bank Limited
	 	$	40,000,000	 
	Union Planters Bank, N.A.
	 	$	40,000,000	 
	William Street Credit Corporation
	 	$	40,000,000	 
	KBC Bank N.V.
	 	$	35,000,000	 
	The Norinchukin Bank
	 	$	30,000,000	 
	Bank of Taiwan
	 	$	25,000,000	 
	The Bank of Tokyo Mitsubishi, Ltd.
	 	$	25,000,000	 
	US Bank National Association
	 	$	25,000,000	 
	Cathay United Bank
	 	$	20,000,000	 
	Bank of Communications
	 	$	10,000,000	 
	First Commercial Bank
	 	$	10,000,000	 
	TOTAL COMMITMENTS
	 	$	2,400,000,000	 

 

 

SCHEDULE 1.1

EXISTING LIENS

Secured Debt

Tax-exempt project bonds issued by Subsidiaries, as disclosed in Note 3, Debt
and Interest Rate Derivatives, to the Borrower’s condensed consolidated
financial statements included within its Quarterly Report on Form 10-Q for the
quarter ended June 30, 2004 and Note 7, Debt and Interest Rate Derivatives, to
the Borrower’s condensed consolidated financial statements included within its
Annual Report on Form 10-K for the year ended December 31, 2003.

Tax-exempt bonds issued by Subsidiaries in California to finance vehicles and
equipment used to perform collection services under municipal contracts.

Capital Leases

Various capital leases entered into by Subsidiaries in the ordinary course of
business for operating equipment and facilities.

 

 

SCHEDULE 3.1

ISSUING BANK LIMITS

	 	 	 	 	 
	Fleet National Bank
	 	$	1,000,000,000	 
	JPMorgan Chase Bank
	 	$	500,000,000	 
	Citibank, N.A.
	 	$	250,000,000	 
	PNC Bank, National Association
	 	$	500,000,000	 
	Wachovia Bank, N.A.
	 	$	500,000,000	 
	SunTrust Bank
	 	$	250,000,000	 
	BNP Paribas
	 	$	300,000,000	 
	 
	 	and, as to Canadian Dollar Letters of Credit, C$200,000,000

 

 

SCHEDULE 3.1.1

FORM OF INCREASE/DECREASE LETTER

Date                                       

     Reference is made to the REVOLVING CREDIT AGREEMENT dated as of October
15, 2004 (as amended and in effect from time to time, the “Credit Agreement”),
by and among WASTE MANAGEMENT, INC., a Delaware corporation (the “Borrower”),
WASTE MANAGEMENT HOLDINGS, INC., a wholly-owned Subsidiary of the Borrower (the
“Guarantor”), certain Banks, and CITIBANK, N.A., as Administrative Agent (the
“Administrative Agent”), and specifically to Schedule 3.1 attached thereto.

     The undersigned, being an Issuing Bank as defined in the Credit Agreement,
hereby agrees pursuant to Section 3.1 of the Credit Agreement that the limit
set forth in said Schedule 3.1 with respect to the undersigned shall, effective
on the date hereof, be changed to $                         .

     The Borrower, the Guarantor and the Administrative Agent acknowledge the
foregoing.

     This letter agreement may be executed in any number of counterparts, and
shall be governed by and construed in accordance with the law of the State of
New York.

	 	 	 	 	 
	 	 	Very truly yours,
	 
	 	 	 	 
	

	 	 	 	[Name of Issuing Bank]
	

	 	By:
	 	

	

	 	 	 	Title:
	 
	 	 	 	 
	 	 	WASTE MANAGEMENT, INC.
	 
	 	 	 	 
	

	 	By:
	 	

	

	 	 	 	Title:
	 
	 	 	 	 
	 	 	WASTE MANAGEMENT
HOLDINGS, INC.
	 
	 	 	 	 
	

	 	By:
	 	

	

	 	 	 	Title:
	 
	 	 	 	 
	 	 	CITIBANK, N.A., as Administrative Agent
	 
	 	 	 	 
	

	 	By:
	 	

	

	 	 	 	Title:

 

 

SCHEDULE 3.1.2

EXISTING LETTERS OF CREDIT

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	LC NUMBER	 	BENEFICIARY	 	EFF DATE	 	EXP DATE	 	AMOUNT
	BANK OF AMERICA
	 	7401615	 	State Street Bank and Trust, as Trustee	 	4/29/1999	 	7/1/2005	 	$	1,323,728.48	 
	 
	 	7411500	 	Wisconsin DNR	 	5/1/2003	 	5/1/2005	 	$	62,149,043.00	 
	 
	 	7411904	 	Fleet National Bank	 	7/1/2003	 	7/1/2005	 	$	28,600,000.00	 
	 
	 	7412800	 	Deutsche Bank Trust Company	 	11/20/2003	 	11/20/2005	 	$	10,118,357.00	 
	 
	 	  7413784*	 	TCEQ	 	3/30/2004	 	3/30/2005	 	$	227,837.00	 
	 
	 	7413955	 	Koch Pulp & Paper Trading, LLC	 	3/31/2004	 	3/31/2005	 	$	40,000,000.00	 
	 
	 	C7119975	 	Virginia DEQ	 	6/10/1988	 	9/1/2005	 	$	491,552.00	 
	 
	 	 	 	 	 	 	 	 	 	 	
 	 
	 
	 	 	 	 	 	 	 	 	 	$	142,910,517.48	 
	BANK ONE
	 	00343889*	 	Pennsylvania DEP	 	11/3/2003	 	11/3/2005	 	$	516,696.00	 
	 
	 	SLT323822*	 	Pennsylvania DEP	 	3/13/2001	 	3/31/2005	 	$	11,618,013.00	 
	 
	 	 	 	 	 	 	 	 	 	 	
 	 
	 
	 	 	 	 	 	 	 	 	 	$	12,134,709.00	 
	BNP
	 	S401407	 	National Union Fire Insurance Co.	 	4/6/1999	 	4/30/2005	 	$	2,323,000.00	 
	 
	 	S401642	 	ACE Overseas	 	3/27/2001	 	3/1/2006	 	$	1,200,000.00	 
	 
	 	S401645	 	City of Del Mar	 	3/30/2001	 	6/30/2005	 	$	100,000.00	 
	 
	 	 	 	 	 	 	 	 	 	 	
 	 
	 
	 	 	 	 	 	 	 	 	 	$	3,623,000.00	 
	DEUTSCHE BANK
	 	839-53169	 	Massachusetts DEP/Oak Brook Bank	 	10/27/1994	 	11/1/2004	 	$	3,600,000.00	 
	 
	 	 	 	 	 	 	 	 	 	 	
 	 

 

 

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	LC NUMBER	 	BENEFICIARY	 	EFF DATE	 	EXP DATE	 	AMOUNT
	 
	 	 	 	 	 	 	 	 	 	$	3,600,000.00	 
	FLEET
	 	1S1251247	 	New Jersey DEP	 	1/26/2001	 	1/30/2006	 	$	2,782,650.29	 
	 
	 	1S1278952	 	New Castle County	 	6/21/2001	 	6/20/2005	 	$	340.00	 
	 
	 	1S1279564	 	Town of Plainville	 	6/28/2001	 	6/30/2005	 	$	5,000.00	 
	 
	 	1S1282117	 	CIWMB	 	8/2/2001	 	8/1/2005	 	$	200,000.00	 
	 
	 	1S1288305	 	County Commissioners of Worcester County	 	9/30/2001	 	6/30/2005	 	$	250,000.00	 
	 
	 	1S1303357	 	City of Tampa	 	12/31/2001	 	12/31/2004	 	$	1,500,000.00	 
	 
	 	1S1303916	 	New York DEC	 	1/15/2002	 	1/15/2006	 	$	10,519,941.00	 
	 
	 	1S1305224	 	ACE	 	1/16/2002	 	12/31/2005	 	$	60,700,000.00	 
	 
	 	1S1311615	 	ACE USA	 	2/7/2002	 	2/28/2006	 	$	19,000,000.00	 
	 
	 	1S1324248	 	Mellon Trust of California	 	4/30/2002	 	4/30/2005	 	$	1,474,902.19	 
	 
	 	1S1332706	 	City of Wheaton	 	6/14/2002	 	6/30/2005	 	$	500,000.00	 
	 
	 	1S1335027	 	ACE Insurance Company	 	12/16/2002	 	12/31/2005	 	$	19,000,000.00	 
	 
	 	1S1335030*	 	TCEQ	 	12/17/2002	 	12/17/2005	 	$	6,372,019.00	 
	 
	 	1S1335031	 	ACE Insurance Company	 	1/22/2003	 	12/31/2005	 	$	105,000,000.00	 
	 
	 	1S1335033*	 	New Hampshire DES	 	6/4/2003	 	6/4/2006	 	$	6,847,416.00	 
	 
	 	1S1335035*	 	TCEQ	 	4/1/2003	 	4/1/2005	 	$	1,952,603.00	 
	 
	 	1S1335043	 	Pennsylvania DEP	 	3/14/2003	 	3/14/2006	 	$	10,219,006.00	 
	 
	 	1S1335045	 	Vermont Commissioner of Insurance	 	7/28/2003	 	7/28/2005	 	$	23,000,000.00	 
	 
	 	1S1335049	 	County of Los Angeles, Dept. of Public Works	 	7/3/2003	 	7/9/2005	 	$	10,000.00	 
	 
	 	1S1335054*	 	TCEQ	 	7/7/2003	 	7/7/2005	 	$	7,614,114.00	 
	 
	 	1S1335059	 	Pennsylvania DEP	 	5/5/2003	 	5/5/2006	 	$	3,238,570.00	 
	 
	 	1S1335064	 	City of Chicago	 	5/16/2003	 	5/16/2005	 	$	250,000.00	 
	 
	 	1S1335074	 	ACE Insurance Company	 	1/1/2004	 	12/31/2005	 	$	105,000,000.00	 
	 
	 	1S1335075	 	ACE Insurance Company of Texas	 	1/1/2004	 	12/31/2005	 	$	9,000,000.00	 

 

 

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	LC NUMBER	 	BENEFICIARY	 	EFF DATE	 	EXP DATE	 	AMOUNT
	 
	 	1S1451465	 	Island County	 	11/4/2003	 	11/4/2005	 	$	1,118,000.00	 
	 
	 	1S50061694	 	Village of Hawthorn Woods	 	10/24/1997	 	11/30/2005	 	$	50,000.00	 
	 
	 	1S50062069	 	City of Holland, MI	 	6/28/1999	 	7/15/2005	 	$	150,000.00	 
	 
	 	1S64016601*	 	TCEQ	 	2/25/2004	 	2/25/2005	 	$	3,537,200.00	 
	 
	 	1S64016602	 	National Resource Recovery, Ltd.	 	4/12/2004	 	4/12/2005	 	$	50,000.00	 
	 
	 	1S64016603	 	National Resource Recovery, Ltd.	 	5/12/2004	 	5/12/2005	 	$	200,000.00	 
	 
	 	1S64016607	 	Oregon DEQ	 	5/17/2004	 	5/17/2005	 	$	15,033,276.00	 
	 
	 	50060791	 	Prairie Crossing H.A.	 	2/11/1994	 	2/11/2005	 	$	10,000,000.00	 
	 
	 	50060807	 	Reliance Insurance	 	1/1/1994	 	1/1/2006	 	$	1,373,000.00	 
	 
	 	50060830	 	City of Stockton	 	3/17/1994	 	1/13/2005	 	$	250,000.00	 
	 
	 	50061032	 	Pennsylvania Manu. Assoc. Ins. Co.	 	7/21/1995	 	7/21/2005	 	$	2,300,000.00	 
	 
	 	50061302	 	Louisiana DNR	 	9/11/1996	 	10/1/2005	 	$	1,733,241.00	 
	 
	 	50061331	 	Anne Arundel County, Maryland	 	10/8/1996	 	10/8/2005	 	$	379,703.00	 
	 
	 	50061368	 	Anne Arundel County, Maryland	 	11/19/1996	 	11/19/2005	 	$	33,471.00	 
	 
	 	50061572	 	Shade Township	 	6/10/1997	 	9/1/2005	 	$	1,748,866.00	 
	 
	 	50061606	 	City of Grand Terrace	 	7/23/1997	 	7/22/2005	 	$	10,000.00	 
	 
	 	50061643	 	National Union Fire Ins. Co. of Pittsburgh	 	10/1/1997	 	5/16/2005	 	$	881,250.00	 
	 
	 	50061680	 	West Virginia DEP	 	10/10/1997	 	3/31/2005	 	$	32,000.00	 
	 
	 	50061771	 	City of Azusa/DEC Mine Reclamation	 	1/28/1999	 	3/31/2005	 	$	499,311.00	 
	 
	 	50061772	 	City of Irwindale/DEC Mine Reclamation	 	1/28/1999	 	3/31/2005	 	$	31,413.00	 
	 
	 	50061801	 	National Union, et al	 	3/31/1998	 	1/1/2006	 	$	13,363,137.00	 
	 
	 	50061869	 	Village of Holiday Hills	 	7/30/1998	 	8/1/2005	 	$	10,000.00	 
	 
	 	50061897	 	Stafford County	 	9/9/1998	 	9/30/2005	 	$	130,000.00	 
	 
	 	50061909	 	Vermont Commissioner of Insurance	 	9/8/1998	 	9/30/2005	 	$	250,000.00	 
	 
	 	50061910	 	Consumers Power Company	 	9/9/1998	 	5/4/2005	 	$	349,054.00	 
	 
	 	50061917	 	American Home Assurance Co.	 	9/10/1998	 	3/30/2005	 	$	2,645,000.00	 

 

 

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	LC NUMBER	 	BENEFICIARY	 	EFF DATE	 	EXP DATE	 	AMOUNT
	 
	 	50061925	 	Antrim Township	 	9/10/1998	 	6/16/2005	 	$	480,000.00	 
	 
	 	50061998	 	City of Two Rivers	 	1/22/1999	 	6/30/2005	 	$	5,000.00	 
	 
	 	50062000	 	Village of Third Lake	 	1/22/1999	 	11/30/2004	 	$	75,000.00	 
	 
	 	50062006	 	Reliance Insurance Company	 	2/17/1999	 	2/25/2006	 	$	8,222,435.00	 
	 
	 	50062042	 	Cumberland County Improvement Authority	 	5/17/1999	 	6/1/2005	 	$	300,000.00	 
	 
	 	50062044	 	Continental Casualty Company	 	5/7/1999	 	6/30/2005	 	$	30,000,000.00	 
	 
	 	50062049	 	City of Farmington Hills & City of Farmington	 	5/21/1999	 	10/1/2005	 	$	1,000,000.00	 
	 
	 	50062050	 	Rayford Hudson	 	5/21/1999	 	5/1/2005	 	$	3,120,000.00	 
	 
	 	50062053	 	City of Chicago	 	5/21/1999	 	12/31/2004	 	$	100,000.00	 
	 
	 	50062054	 	City of Chicago	 	5/21/1999	 	12/31/2004	 	$	500,000.00	 
	 
	 	50062065	 	Village of Northfield	 	6/4/1999	 	4/30/2005	 	$	500,000.00	 
	 
	 	50062075	 	City of Indian Wells	 	8/10/1999	 	7/1/2005	 	$	10,000.00	 
	 
	 	50062114	 	Delaware DNREC	 	2/10/2000	 	12/31/2005	 	$	9,830,614.43	 
	 
	 	50062124	 	Kittitas County of Washington	 	5/13/2000	 	5/13/2005	 	$	100,000.00	 
	 
	 	50062141	 	National Union Fire Ins. Co.	 	6/15/2000	 	6/30/2005	 	$	3,085,000.00	 
	 
	 	 	 	 	 	 	 	 	 	 	
 	 
	 
	 	 	 	 	 	 	 	 	 	$	507,922,532.91	 
	JPMORGAN CHASE
	 	P010299 (867261)	 	The Bank of New York, as Trustee	 	9/1/1995	 	9/30/2005	 	$	3,575,513.70	 
	 
	 	P010300 (867678)	 	The Bank of New York, as Trustee	 	4/23/1996	 	6/30/2005	 	$	5,793,498.00	 
	 
	 	P010301 (867885)	 	The Bank of New York, as Trustee	 	9/26/1996	 	12/31/2004	 	$	4,414,094.00	 
	 
	 	P010302 (867886)	 	The Bank of New York, as Trustee	 	9/19/1996	 	12/31/2004	 	$	20,323,221.00	 
	 
	 	P224666 (D205048)	 	Continental Casualty Company	 	8/31/2000	 	6/29/2005	 	$	90,684,000.00	 
	 
	 	P224668 (D-214841)	 	Stafford County Board of Supervisors	 	6/7/2001	 	12/7/2004	 	$	7,725.00	 
	 
	 	P224669 (D-216965)	 	Stafford County Board of Supervisors	 	8/24/2001	 	7/24/2005	 	$	75,577.00	 

 

 

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	LC NUMBER	 	BENEFICIARY	 	EFF DATE	 	EXP DATE	 	AMOUNT
	 
	 	P224670 (I275983/I-445329)	 	National Union	 	5/5/1993	 	5/5/2005	 	$	742,500.00	 
	 
	 	P224672 (I276041)	 	National Union	 	5/1/1995	 	5/1/2005	 	$	385,900.00	 
	 
	 	P224678 (I445690)	 	National Union Fire Insurance Company of Pittsburgh	 	5/25/1994	 	5/31/2005	 	$	421,000.00	 
	 
	 	P224679 (I449973)	 	National Union	 	12/13/1994	 	12/31/2005	 	$	150,000.00	 
	 
	 	P224680 (I455132)	 	National Union	 	8/8/1995	 	8/8/2005	 	$	900,000.00	 
	 
	 	P224681 (I459334)	 	National Union Fire Insurance Company	 	1/30/1996	 	1/31/2006	 	$	1,911,666.00	 
	 
	 	P224691	 	Israel Electric Corporation-Bank Hapoalim-Tel Aviv	 	11/18/1999	 	8/12/2005	 	$	1,080,400.00	 
	 
	 	P224694 (I449058)	 	Central Valley Regional WQCB	 	10/28/1994	 	10/30/2005	 	$	203,400.00	 
	 
	 	P225252	 	Bank of New York	 	3/1/2001	 	3/18/2005	 	$	20,279,452.06	 
	 
	 	P225809	 	Bank of New York	 	5/29/2002	 	5/29/2005	 	$	10,118,357.00	 
	 
	 	P227887	 	Bank of New York	 	7/24/2002	 	7/24/2005	 	$	20,236,713.00	 
	 
	 	P228576	 	Bank of New York	 	8/9/2002	 	8/9/2005	 	$	14,327,593.00	 
	 
	 	P230274	 	Bank of New York	 	9/24/2002	 	9/24/2005	 	$	10,118,357.00	 
	 
	 	P230584	 	Bank of New York	 	10/4/2002	 	10/4/2005	 	$	20,236,713.00	 
	 
	 	P231095	 	Deutsche Bank Trust Company	 	10/23/2002	 	10/23/2005	 	$	14,165,699.00	 
	 
	 	P231096	 	Deutsche Bank Trust Company	 	10/23/2002	 	10/23/2005	 	$	25,295,891.00	 
	 
	 	P231097	 	Deutsche Bank Trust Company	 	10/23/2002	 	10/23/2005	 	$	4,755,628.00	 
	 
	 	P231098	 	Deutsche Bank Trust Company	 	10/23/2002	 	10/23/2005	 	$	20,236,713.00	 
	 
	 	P232178	 	Bank of New York	 	11/26/2002	 	11/26/2005	 	$	25,295,891.00	 
	 
	 	P244624	 	Deutsche Bank Trust Company	 	1/15/2004	 	1/15/2005	 	$	30,355,069.00	 
	 
	 	P247295	 	Deutsche Bank Trust Company	 	4/14/2004	 	4/14/2005	 	$	35,414,247.00	 
	 
	 	Y365525	 	State Street Bank and Trust Company	 	5/20/1998	 	5/20/2005	 	$	2,650,000.00	 
	 
	 	 	 	 	 	 	 	 	 	 	
 	 
	 
	 	 	 	 	 	 	 	 	 	$	384,154,817.76	 

 

 

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	LC NUMBER	 	BENEFICIARY	 	EFF DATE	 	EXP DATE	 	AMOUNT
	SUNTRUST
	 	ATL/P601487	 	Orange County, Florida	 	4/3/2002	 	10/22/2005	 	$	17,014,246.00	 
	 
	 	F841477	 	Indian River County Solid Waste Disposal District	 	6/26/2003	 	6/23/2005	 	$	500,000.00	 
	 
	 	P000125	 	Metropolitan Dept. of Water & Sewerage Services of Davidson County	 	12/13/2002	 	12/11/2004	 	$	60,000.00	 
	 
	 	P000515	 	Orange County Public Works, Florida	 	5/1/2003	 	5/1/2005	 	$	169,125.00	 
	 
	 	 	 	 	 	 	 	 	 	 	
 	 
	 
	 	 	 	 	 	 	 	 	 	$	17,743,371.00	 
	WACHOVIA
	 	LC870-093799	 	State Street Bank and Trust Company	 	12/16/1997	 	1/5/2006	 	$	36,686,795.00	 
	 
	 	LC870-097201	 	State Street Bank and Trust	 	1/29/1998	 	2/18/2006	 	$	2,500,000.00	 
	 
	 	LC870-099286 (80002)	 	Bank of New York	 	4/2/1998	 	11/5/2005	 	$	10,376,667.00	 
	 
	 	LC870-112455 (80005)	 	Bank of New York	 	8/5/1999	 	11/5/2005	 	$	15,260,000.00	 
	 
	 	LC870-123638	 	Bank of New York	 	9/27/2000	 	10/1/2005	 	$	20,346,667.00	 
	 
	 	LC870-123639	 	Bank of New York	 	9/27/2000	 	10/1/2005	 	$	10,173,334.00	 
	 
	 	SM203351W*	 	New York DEC	 	5/30/2003	 	5/31/2005	 	$	68,657,993.00	 
	 
	 	SM204054W	 	Bank of New York	 	7/15/2003	 	7/15/2005	 	$	15,177,535.00	 
	 
	 	SM204293W	 	Bank of New York	 	7/31/2003	 	7/31/2005	 	$	25,295,891.00	 
	 
	 	SM204597W	 	Deutsche Bank Trust Company	 	8/25/2003	 	8/25/2005	 	$	10,121,644.00	 
	 
	 	SM204784W	 	Deutsche Bank Trust Company	 	9/9/2003	 	9/9/2005	 	$	30,355,069.00	 
	 
	 	SM205017W	 	Deutsche Bank Trust Company	 	9/26/2003	 	9/26/2005	 	$	7,386,400.00	 
	 
	 	SM205019W	 	Deutsche Bank Trust Company	 	9/26/2003	 	9/26/2005	 	$	2,731,957.00	 
	 
	 	SM205020W	 	Deutsche Bank Trust Company	 	9/26/2003	 	9/26/2005	 	$	1,467,162.00	 
	 
	 	SM205026W	 	Deutsche Bank Trust Company	 	9/26/2003	 	9/26/2005	 	$	7,538,176.00	 
	 
	 	SM205027W	 	Deutsche Bank Trust Company	 	9/26/2003	 	9/26/2005	 	$	11,130,192.00	 
	 
	 	SM205506W	 	Deutsche Bank Trust Company	 	10/31/2003	 	10/31/2005	 	$	6,657,879.00	 

 

 

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	LC NUMBER	 	BENEFICIARY	 	EFF DATE	 	EXP DATE	 	AMOUNT
	 
	 	SM205507W	 	Deutsche Bank Trust Company	 	10/31/2003	 	10/31/2005	 	$	8,519,656.00	 
	 
	 	SM205508W	 	Deutsche Bank Trust Company	 	10/31/2003	 	10/31/2005	 	$	3,769,088.00	 
	 
	 	SM205509W	 	Deutsche Bank Trust Company	 	10/31/2003	 	10/31/2005	 	$	4,224,414.00	 
	 
	 	SM205510W	 	Deutsche Bank Trust Company	 	10/31/2003	 	10/31/2005	 	$	4,401,485.00	 
	 
	 	 	 	 	 	 	 	 	 	 	
 	 
	 
	 	 	 	 	 	 	 	 	 	$	302,778,004.00	 
	Aggregate Amount:
	 	 	 	 	 	 	 	 	 	 	1,374,866,952.15	 

 

 

SCHEDULE 6.7

LITIGATION

See the disclosure provided in (1) the “Litigation” section of Note 8,
Commitments and Contingencies, to Borrower’s condensed consolidated financial
statements included within its Quarterly Report on Form 10-Q for the fiscal
quarter ended June 30, 2004 and (2) the “Litigation” section of Note 10,
Commitments and Contingencies, to Borrower’s consolidated financial statements
included within its Annual Report on Form 10-K for the fiscal year ended
December 31, 2003.

 

 

SCHEDULE 6.15

ENVIRONMENTAL COMPLIANCE

See the disclosure provided in (1) Note 2, Landfill and Environmental
Remediation Liabilities and the “Environmental Matters” and “Litigation”
sections of Note 8, Commitments and Contingencies, to Borrower’s condensed
consolidated financial statements included within its Quarterly Report on Form
10-Q for the fiscal quarter ended June 30, 2004 and (2) Note 4, Landfill and
Environmental Remediation Liabilities, and the “Environmental Matters” and
“Litigation” sections of Note 10, Commitments and Contingencies, to Borrower’s
consolidated financial statements included within its Annual Report on Form
10-K for the fiscal year ended December 31, 2003.

 

 

SCHEDULE 8.1(a)

EXISTING INDEBTEDNESS

Indebtedness of Waste Management Holdings, Inc. and Subsidiaries

	 	 	 	 	 	 	 	 	 
	 	 	Estimated Amount	 	 
	Instrument
	 	at 10/15/04
	 	Interest Rate

	Waste Management Holdings, Inc. Senior Notes
	 	 	 	 	 	 	 	 
	$200,000,000 due 05/15/05
	 	 	2,974,000	 	 	 	6.650	%
	$100,000,000 due 05/15/05
	 	 	99,955,996	 	 	 	7.000	%
	$300,000,000 due 10/15/06
	 	 	299,825,019	 	 	 	7.000	%
	$148,440,000 due 03/15/11
	 	 	147,413,539	 	 	 	7.650	%
	$250,000,000 due 05/01/18
	 	 	243,854,136	 	 	 	8.750	%
	$450,000,000 due 08/01/26
	 	 	448,975,000	 	 	 	7.100	%
	 
	 	 	
 	 	 	 	 	 
	Total Senior Notes
	 	$	1,242,997,691	 	 	 	 	 
	Waste Management Holdings, Inc. Convertible Bonds
	 	 	 	 	 	 	 	 
	01/24/05
	 	 	34,053,981	 	 	 	5.750	%
	 
	 	 	
 	 	 	 	 	 
	Total Convertible Bonds
	 	$	34,053,981	 	 	 	 	 

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Estimated Amount at	 	 
	Tax Exempt Revenue Bonds
	 	Maturity Date
	 	10/15/04
	 	Interest Rate

	Amelia, Virginia
	 	 	04/01/27	 	 	 	26,800,000	 	 	 	4.900	%
	Arkansas
	 	 	08/01/21	 	 	 	15,000,000	 	 	 	3.000	%
	Arkansas
	 	 	06/01/28	 	 	 	15,000,000	 	 	Variable
	Brazoria County 2003A
	 	 	05/01/28	 	 	 	12,000,000	 	 	 	2.500	%
	Bucks County
	 	 	12/01/22	 	 	 	25,000,000	 	 	 	4.900	%
	California CMCFA 2004
	 	 	09/01/14	 	 	 	15,000,000	 	 	 	4.100	%
	California CPCFA
	 	 	07/01/31	 	 	 	19,000,000	 	 	 	5.125	%
	California CPCFA
	 	 	07/01/27	 	 	 	38,435,000	 	 	 	4.450	%
	California CPCFA
	 	 	01/01/22	 	 	 	48,500,000	 	 	 	3.125	%
	California CPCFA
	 	 	12/01/27	 	 	 	15,000,000	 	 	 	4.850	%
	California CPCFA Series 2003A
	 	 	11/01/38	 	 	 	35,700,000	 	 	 	5.000	%
	Carolina North
	 	 	08/01/14	 	 	 	6,500,000	 	 	 	4.000	%
	Carolina South
	 	 	11/01/16	 	 	 	12,500,000	 	 	 	4.100	%
	Charles City
	 	 	02/01/09	 	 	 	40,600,000	 	 	 	4.875	%

 

 

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Estimated Amount at	 	 
	Tax Exempt Revenue Bonds
	 	Maturity Date
	 	10/15/04
	 	Interest Rate

	Charles City (Virginia)
	 	 	04/01/27	 	 	 	10,000,000	 	 	 	6.250	%
	Charles City 2003A
	 	 	08/01/27	 	 	 	10,000,000	 	 	 	5.125	%
	Charles City 2004 A
	 	 	02/01/29	 	 	 	30,000,000	 	 	Variable
	Chesser A
	 	 	04/01/18	 	 	 	6,701,792	 	 	 	7.375	%
	City of Granite City Illinois
	 	 	05/01/27	 	 	 	30,320,000	 	 	 	5.000	%
	City of Hampton
	 	 	09/01/28	 	 	 	10,000,000	 	 	Variable
	City of Minor Lane Heights 2003
	 	 	03/01/21	 	 	 	11,000,000	 	 	Variable
	Cobb County 2004 A-1
	 	 	04/01/33	 	 	 	10,000,000	 	 	 	2.100	%
	Cobb County 2004 A-2
	 	 	04/01/33	 	 	 	10,000,000	 	 	 	3.100	%
	Colorado
	 	 	07/01/27	 	 	 	14,160,000	 	 	Variable
	Colorado 2003
	 	 	08/01/38	 	 	 	10,000,000	 	 	Variable
	Colorado 2004
	 	 	07/01/18	 	 	 	10,840,000	 	 	 	5.700	%
	Countryside
	 	 	04/01/21	 	 	 	5,670,000	 	 	Variable
	Countryside
	 	 	09/01/21	 	 	 	4,320,000	 	 	Variable
	County of Graves Series 2003
	 	 	03/01/21	 	 	 	2,700,000	 	 	Variable
	County of Laurel 2003
	 	 	03/01/21	 	 	 	7,300,000	 	 	Variable
	County of Logan 2003
	 	 	03/01/21	 	 	 	7,450,000	 	 	Variable
	CSCDA
	 	 	04/01/11	 	 	 	25,000,000	 	 	 	2.900	%
	Denton County 2003B
	 	 	05/01/28	 	 	 	10,000,000	 	 	 	3.500	%
	East Central Alabama 2003
	 	 	10/01/28	 	 	 	3,725,000	 	 	Variable
	Gilliam County
	 	 	08/01/25	 	 	 	15,900,000	 	 	 	4.150	%
	Gilliam County
	 	 	07/01/29	 	 	 	25,000,000	 	 	 	2.500	%
	Gilliam County 2003A
	 	 	07/01/38	 	 	 	15,000,000	 	 	 	4.875	%
	Gloucester 2003A
	 	 	09/01/38	 	 	 	10,000,000	 	 	 	5.125	%
	Gulf Coast 2004A
	 	 	04/01/19	 	 	 	35,000,000	 	 	Variable
	Hampton (Wachovia)
	 	 	04/01/13	 	 	 	10,000,000	 	 	Variable
	Harris County 2003D (Gulf Coast Waste)
	 	 	04/01/12	 	 	 	25,000,000	 	 	 	3.200	%
	Harrison County, WV 2003A
	 	 	08/01/24	 	 	 	8,420,000	 	 	Variable
	Illinois
	 	 	09/01/27	 	 	 	30,000,000	 	 	Variable
	Illinois
	 	 	10/01/23	 	 	 	20,000,000	 	 	Variable
	Illinois (Waste Management Holdings,
Inc. Indebtedness)
	 	 	01/01/10	 	 	 	34,570,000	 	 	 	5.050	%
	Indiana
	 	 	10/01/25	 	 	 	25,000,000	 	 	Variable
	Indiana
	 	 	10/01/25	 	 	 	14,000,000	 	 	Variable
	Indiana
	 	 	10/01/31	 	 	 	10,000,000	 	 	 	2.700	%
	King George
	 	 	06/01/23	 	 	 	20,000,000	 	 	 	4.100	%
	Maine Series 2003
	 	 	02/01/16	 	 	 	30,000,000	 	 	 	2.900	%
	Maricopa (Arizona)
	 	 	12/01/31	 	 	 	15,580,000	 	 	 	4.800	%
	Maryland Series 2002
	 	 	04/01/16	 	 	 	10,200,000	 	 	 	2.300	%
	Massachusetts DFA 2002
	 	 	05/01/27	 	 	 	15,000,000	 	 	 	5.500	%
	Massachusetts DFA 2003
	 	 	06/01/14	 	 	 	15,000,000	 	 	 	5.450	%
	Michigan Strategic Series 2001
	 	 	08/01/27	 	 	 	35,000,000	 	 	 	3.750	%

 

 

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Estimated Amount at	 	 
	Tax Exempt Revenue Bonds
	 	Maturity Date
	 	10/15/04
	 	Interest Rate

	Michigan Strategic Series 2002
	 	 	12/01/12	 	 	 	35,000,000	 	 	 	4.200	%
	Michigan Strategic Fund 2004 A
	 	 	12/01/13	 	 	 	22,000,000	 	 	 	2.200	%
	Michigan Strategic Fund 2004 B
	 	 	12/01/13	 	 	 	13,000,000	 	 	 	3.000	%
	Mississippi
	 	 	03/01/27	 	 	 	10,000,000	 	 	 	2.300	%
	Mississippi 2003
	 	 	07/01/28	 	 	 	10,000,000	 	 	Variable
	Mississippi 2004
	 	 	03/01/29	 	 	 	10,000,000	 	 	 	3.350	%
	Mobile, AL Series 2003
	 	 	10/01/28	 	 	 	4,175,000	 	 	Variable
	Nashville (Tennessee)
	 	 	08/01/31	 	 	 	10,000,000	 	 	 	4.100	%
	Nebraska Series 2003A
	 	 	11/01/33	 	 	 	10,000,000	 	 	Variable
	Nevada
	 	 	10/01/14	 	 	 	10,000,000	 	 	 	4.550	%
	New Jersey
	 	 	11/01/13	 	 	 	20,000,000	 	 	 	4.000	%
	New Jersey 2004 A-1
	 	 	06/01/15	 	 	 	10,000,000	 	 	 	2.850	%
	New Jersey 2004 A-2
	 	 	06/01/15	 	 	 	15,000,000	 	 	 	5.300	%
	New York City 1997
	 	 	12/01/17	 	 	 	20,000,000	 	 	Variable
	New York Series 2002
	 	 	05/01/12	 	 	 	31,000,000	 	 	 	4.000	%
	New York Series 2002 B
	 	 	05/01/19	 	 	 	25,000,000	 	 	Variable
	New York Series 2004A
	 	 	07/01/17	 	 	 	20,000,000	 	 	 	4.450	%
	North Sumter, AL Series 2003
	 	 	10/01/28	 	 	 	4,350,000	 	 	Variable
	Ohio Series 2003
	 	 	03/01/21	 	 	 	1,450,000	 	 	Variable
	Ohio WDA
	 	 	11/01/22	 	 	 	45,865,000	 	 	 	4.850	%
	Ohio WDA 2004
	 	 	07/01/21	 	 	 	15,000,000	 	 	 	4.500	%
	Okeechobee
	 	 	03/01/05	 	 	 	1,750,000	 	 	Variable
	Okeechobee
	 	 	03/01/06	 	 	 	1,750,000	 	 	Variable
	Okeechobee
	 	 	08/01/24	 	 	 	15,000,000	 	 	Variable
	Okeechobee 2004A
	 	 	07/01/39	 	 	 	15,970,000	 	 	 	4.200	%
	Rhode Island
	 	 	04/01/16	 	 	 	8,000,000	 	 	 	2.750	%
	Richland (SC)
	 	 	06/01/15	 	 	 	10,000,000	 	 	Variable
	Savannah 2004A
	 	 	07/01/16	 	 	 	5,000,000	 	 	 	5.500	%
	Schuylkill/Pine Grove
	 	 	10/01/19	 	 	 	11,700,000	 	 	 	5.100	%
	South Carolina 2003A
	 	 	07/01/24	 	 	 	15,000,000	 	 	Variable
	Southwestern Illinois
	 	 	10/01/27	 	 	 	4,700,000	 	 	Variable
	State of New Hampshire
	 	 	05/01/27	 	 	 	20,000,000	 	 	 	2.900	%
	State of New Hampshire
	 	 	09/01/12	 	 	 	20,000,000	 	 	Variable
	State of New Hampshire 2003
	 	 	08/01/24	 	 	 	15,000,000	 	 	 	2.900	%
	Sussex Co.
	 	 	06/01/28	 	 	 	10,000,000	 	 	 	5.125	%
	Sussex Co. Virginia
	 	 	09/01/27	 	 	 	10,000,000	 	 	Variable
	Tennessee 2003
	 	 	07/01/33	 	 	 	25,000,000	 	 	Variable
	Travis County 2003C
	 	 	05/01/28	 	 	 	12,000,000	 	 	 	3.200	%
	Valley Facility (MidAm)
	 	 	05/01/18	 	 	 	24,400,000	 	 	 	5.100	%
	Washington 2000-H
	 	 	10/01/25	 	 	 	13,650,000	 	 	Variable
	Washington 2000-I
	 	 	10/01/25	 	 	 	13,650,000	 	 	Variable

 

 

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Estimated Amount at	 	 
	Tax Exempt Revenue Bonds
	 	Maturity Date
	 	10/15/04
	 	Interest Rate

	Washington 2000-L
	 	 	12/01/25	 	 	 	7,235,000	 	 	Variable
	Washington 2001-C
	 	 	02/01/26	 	 	 	22,000,000	 	 	Variable
	Washington 2002-D
	 	 	07/01/30	 	 	 	20,000,000	 	 	Variable
	Washington 2002-E
	 	 	10/01/27	 	 	 	20,000,000	 	 	Variable
	Wisconsin Series 2003A
	 	 	04/01/16	 	 	 	50,000,000	 	 	 	2.500	%
	Wood County, WV
	 	 	04/01/24	 	 	 	6,580,000	 	 	Variable
	Yavapai (2003A-1)
	 	 	03/01/28	 	 	 	20,000,000	 	 	 	3.650	%
	Yavapai (2003A-2)
	 	 	03/01/28	 	 	 	17,420,000	 	 	 	4.450	%
	Yavapai (Arizona)
	 	 	06/01/27	 	 	 	30,000,000	 	 	 	4.625	%
	 
	 	 	 	 	 	 	
 	 	 	 	 	 
	Total Tax Exempt Bonds
	 	 	 	 	 	 	1,760,536,792	 	 	 	 	 

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Estimated Amount at	 	 
	Tax Exempt Project Bonds
	 	Maturity Date
	 	10/15/04
	 	Interest Rate

	Claremont Bonds
	 	 	07/01/05	 	 	 	1,485,000	 	 	 	5.100	%
	Claremont Bonds
	 	 	07/01/06	 	 	 	1,620,000	 	 	 	5.200	%
	Claremont Bonds
	 	 	07/01/07	 	 	 	3,100,000	 	 	 	5.300	%
	Concord Debt Series A
	 	 	01/01/18	 	 	 	31,315,000	 	 	Variable
	Concord Debt Series B
	 	 	01/01/18	 	 	 	4,925,000	 	 	Variable
	Gloucester Bonds
	 	 	12/01/09	 	 	 	32,585,000	 	 	 	6.850	%
	Gloucester Bonds
	 	 	12/01/09	 	 	 	6,930,000	 	 	 	7.000	%
	Westchester Debt
	 	 	07/01/05	 	 	 	8,630,000	 	 	 	5.400	%
	Westchester Debt
	 	 	07/01/06	 	 	 	9,080,000	 	 	 	5.500	%
	Westchester Debt
	 	 	07/01/07	 	 	 	14,695,000	 	 	 	5.600	%
	Westchester Debt
	 	 	07/01/08	 	 	 	15,425,000	 	 	 	5.700	%
	Westchester Debt
	 	 	07/01/09	 	 	 	16,225,000	 	 	 	5.750	%
	Westchester Debt
	 	 	07/01/05	 	 	 	7,290,000	 	 	 	5.000	%
	Westchester Debt
	 	 	07/01/06	 	 	 	7,845,000	 	 	 	5.130	%
	Westchester Debt
	 	 	07/01/07	 	 	 	7,890,000	 	 	 	5.200	%
	Westchester Debt
	 	 	07/01/08	 	 	 	3,405,000	 	 	 	6.000	%
	Westchester Debt
	 	 	07/01/09	 	 	 	8,300,000	 	 	 	5.500	%
	Net Premium on Westchester
	 	 	 	 	 	 	(5,745	)	 	 	 	 
	North Broward
	 	 	12/01/04	 	 	 	11,765,000	 	 	 	5.000	%
	North Broward
	 	 	12/01/05	 	 	 	12,975,000	 	 	 	5.000	%
	North Broward
	 	 	12/01/06	 	 	 	14,315,000	 	 	 	5.000	%
	North Broward
	 	 	12/01/07	 	 	 	15,805,000	 	 	 	5.000	%
	North Broward
	 	 	12/01/08	 	 	 	22,190,000	 	 	 	5.500	%
	North Broward
	 	 	12/01/09	 	 	 	17,040,000	 	 	 	5.380	%
	North Broward
	 	 	12/01/10	 	 	 	17,955,000	 	 	 	5.380	%
	North Broward
	 	 	12/01/11	 	 	 	15,480,000	 	 	 	4.500	%

 

 

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Estimated Amount at	 	 
	Tax Exempt Project Bonds
	 	Maturity Date
	 	10/15/04
	 	Interest Rate

	Premium on North Broward
	 	 	 	 	 	 	2,948,137	 	 	 	 	 
	South Broward
	 	 	12/01/04	 	 	 	14,010,000	 	 	 	5.000	%
	South Broward
	 	 	12/01/05	 	 	 	15,430,000	 	 	 	5.000	%
	South Broward
	 	 	12/01/06	 	 	 	17,010,000	 	 	 	5.000	%
	South Broward
	 	 	12/01/07	 	 	 	18,755,000	 	 	 	5.000	%
	South Broward
	 	 	12/01/08	 	 	 	26,225,000	 	 	 	5.500	%
	South Broward
	 	 	12/01/09	 	 	 	20,240,000	 	 	 	5.380	%
	South Broward
	 	 	12/01/10	 	 	 	21,330,000	 	 	 	5.380	%
	South Broward
	 	 	12/01/11	 	 	 	14,865,000	 	 	 	4.500	%
	Premium on South Broward
	 	 	 	 	 	 	3,475,678	 	 	 	 	 
	North Andover
	 	 	 	 	 	 	44,278,100	 	 	 	6.300	%
	Discount on North Andover
	 	 	 	 	 	 	(92,400	)	 	 	 	 
	Massachusetts
	 	 	05/01/27	 	 	 	10,000,000	 	 	Variable
	Other Project Bonds
	 	Various Maturities	 	 	5,300,000	 	 	 	9.250	%
	 
	 	 	 	 	 	 	
 	 	 	 	 	 
	Total Project Bonds
	 	 	 	 	 	$	522,038,770	 	 	 	 	 
	 
	 	 	 	 	 	 	
 	 	 	 	 	 
	Other Indebtedness
	 	 	 	 	 	 	 	 	 	 	 	 
	Wheelabrator
LLC Bonds – NE Maryland
	 	 	01/01/05	 	 	 	16,175,000	 	 	 	7.200	%
	Wheelabrator
LLC Bonds – NE Maryland
	 	 	01/01/06	 	 	 	17,440,000	 	 	 	7.200	%
	Wheelabrator
LLC Bonds – NE Maryland
	 	 	01/01/07	 	 	 	14,890,000	 	 	 	7.200	%
	Wheelabrator
LLC Bonds – CRRA
	 	 	01/01/05	 	 	 	3,900,000	 	 	 	4.750	%
	Wheelabrator
LLC Bonds – CRRA
	 	 	07/01/05	 	 	 	12,000,000	 	 	 	5.000	%
	Wheelabrator
LLC Bonds – CRRA
	 	 	01/01/06	 	 	 	2,000,000	 	 	 	4.875	%
	Wheelabrator
LLC Bonds – CRRA
	 	 	07/01/06	 	 	 	15,000,000	 	 	 	5.375	%
	Wheelabrator
LLC Bonds – CRRA
	 	 	01/01/07	 	 	 	18,200,000	 	 	 	5.000	%
	Wheelabrator
LLC Bonds – CRRA
	 	 	01/01/08	 	 	 	4,500,000	 	 	 	5.000	%
	Wheelabrator
LLC Bonds – CRRA
	 	 	07/01/08	 	 	 	15,000,000	 	 	 	5.500	%
	Wheelabrator
LLC Bonds – CRRA
	 	 	01/01/09	 	 	 	13,225,000	 	 	 	5.125	%
	Millbury
	 	Various Maturities	 	 	29,867,345	 	 	 	 	 
	Other Notes and capital leases
	 	 	 	 	 	 	453,503,023	 	 	 	 	 
	 
	 	 	 	 	 	 	
 	 	 	 	 	 
	Total Other Indebtedness
	 	 	 	 	 	$	615,700,368	 	 	 	 	 
	 
	 	 	 	 	 	 	
 	 	 	 	 	 
	Total Indebtedness
	 	 	 	 	 	$	4,175,327,603

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00073-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00073-of-00352.parquet"}]]