Document:

Exhibit 4.1

               STRATS(SM) CERTIFICATES SERIES SUPPLEMENT 2005-3

                                    between

                   SYNTHETIC FIXED-INCOME SECURITIES, INC.,
                                  as Trustor

                                      and

                     U.S. BANK TRUST NATIONAL ASSOCIATION,
                    as Trustee and Securities Intermediary

    STRATS(SM) TRUST FOR GOLDMAN SACHS CAPITAL I SECURITIES, SERIES 2005-3

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                                               TABLE OF CONTENTS

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PRELIMINARY STATEMENT.............................................................................................1

Section 1.        Certain Defined Terms...........................................................................1

Section 2.        Creation and Declaration of Trust; Sale of Underlying Securities; Acceptance by Trustee.........5

Section 3.        Designation.....................................................................................6

Section 4.        Date of the Certificates........................................................................7

Section 5.        Certificate Stated Amount and Denominations.....................................................7

Section 6.        Currency of the Certificates....................................................................7

Section 7.        Form of Securities..............................................................................7

Section 8.        Swap Payments; Collateral Account...............................................................7

Section 9.        Certain Provisions of Base Trust Agreement Not Applicable.......................................8

Section 10.       Distributions...................................................................................8

Section 11.       Termination of Trust...........................................................................10

Section 12.       Limitation of Powers and Duties................................................................11

Section 13.       Compensation of Trustee........................................................................12

Section 14.       Modification or Amendment of the Base Trust Agreement, the Series Supplement or the
                  Swap Agreement.................................................................................12

Section 15.       Assignment of Rights under the Swap Agreement..................................................13

Section 16.       Accounting.....................................................................................13

Section 17.       No Investment of Amounts Received on Underlying Securities.....................................13

Section 18.       No Event of Default............................................................................14

Section 19.       Notices........................................................................................14

Section 20.       Access to Certain Documentation................................................................14

Section 21.       Advances.......................................................................................15
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Section 22.       Ratification of Agreement......................................................................15

Section 23.       Counterparts...................................................................................15

Section 24.       Governing Law..................................................................................15

Section 25.       Certificate of Compliance......................................................................15

Section 26.       Certain Filing to be Made by the Trustee.......................................................15

Section 27.       Establishment of Accounts......................................................................15

Section 28.       Statement of Intent............................................................................16

Section 29.       Filing of Partnership Returns..................................................................16

Section 30.       "Financial Assets" Election....................................................................16

Section 31.       Trustee's Entitlement Orders...................................................................16

Section 32.       Conflict with Other Agreements.................................................................16

Section 33.       Additional Trustee and Securities Intermediary Representations.................................17

Section 34.       Additional Trustor Representations.............................................................17

Section 35.       Certification Requirements.....................................................................18

Section 36.       Additional Rights of the Swap Counterparty.....................................................18

Section 37.       Modification of Certain Provisions of Base Trust Agreement.....................................18

Section 38.       Evidence of Integration for Tax Purposes.......................................................18

Section 39.       Optional Exchange..............................................................................18
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Exhibit A -- Identification of the Underlying Securities as of Closing Date
Exhibit B -- Terms of the Certificates as of Closing Date
Exhibit C -- Form of Certificates
Exhibit D -- Form of Swap Agreement
Exhibit E -- Evidence of Integration for Tax Purposes

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         STRATS(SM) SERIES SUPPLEMENT 2005-3, dated as of September 30, 2005
         (this "Series Supplement"), between SYNTHETIC FIXED-INCOME
         SECURITIES, INC., a Delaware corporation, as Trustor (the "Trustor"),
         and U.S. Bank Trust National Association, a national banking
         association, as trustee (the "Trustee") and as securities
         intermediary (the "Securities Intermediary").

                             PRELIMINARY STATEMENT

                  Pursuant to the Base Trust Agreement, dated as of September
26, 2003 (the "Base Trust Agreement" and, as supplemented pursuant to the
Series Supplement, the "Agreement"), between the Trustor and the Trustee, such
parties may at any time and from time to time enter into a series supplement
supplemental to the Base Trust Agreement for the purpose of creating a trust.
Section 5.13 of the Base Trust Agreement provides that the Trustor may at any
time and from time to time direct the Trustee to authenticate and deliver, on
behalf of any such trust, a new Series of trust certificates. Each trust
certificate of such new Series of trust certificates will represent a
fractional undivided beneficial interest in such trust. Certain terms and
conditions applicable to each such Series are to be set forth in the related
series supplement to the Base Trust Agreement.

                  Pursuant to this Series Supplement, the Trustor and the
Trustee shall create and establish a new trust to be known as STRATS(SM) Trust
For Goldman Sachs Capital I Securities, Series 2005-3, and a new Series of
trust certificates to be issued thereby, which certificates shall be known as
the STRATS(SM) Certificates, Series 2005-3, and the Trustor and the Trustee
shall herein specify certain terms and conditions in respect thereof. The
Trust shall also enter into a swap agreement (the "Swap Agreement") pursuant
to which the Trust will exchange interest payments due on the Underlying
Securities for payments from the Swap Counterparty which will be passed
through to the Certificateholders.

                  The STRATS(SM) Certificates, Series 2005-3 shall be floating
rate Certificates (the "Certificates") issued in the form thereof set forth in
Exhibit C.

                  On behalf of and pursuant to the authorizing resolutions of
the Board of Directors of the Trustor, an authorized officer of the Trustor
has authorized the execution, authentication and delivery of the Certificates,
and has authorized the Base Trust Agreement, the Swap Agreement (as defined
below), and this Series Supplement in accordance with the terms of Section
5.13 of the Base Trust Agreement.

                  Section 1. Certain Defined Terms. (a) All terms used in this
Series Supplement that are defined in the Base Trust Agreement, either
directly or by reference therein, have the meanings assigned to such terms
therein, except to the extent such terms are defined or modified in this
Series Supplement or the context requires otherwise. The Base Trust Agreement
also contains rules as to usage which shall be applicable hereto.

                  (b) Pursuant to Article I of the Base Trust Agreement, the
meaning of certain defined terms used in the Base Trust Agreement shall, when
applied to the trust certificates of a particular Series, be as defined in
Article I but with such additional provisions and modifications

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as are specified in the related series supplement. With respect to the
Certificates, the following definitions shall apply:

                  "Acceleration": The acceleration of the maturity of the
Underlying Securities after the occurrence of any default on the Underlying
Securities other than a Payment Default.

                  "Accounts": Collectively the Certificate Account and the
Collateral Account.

                  "Affected Party": Shall have the meaning provided under the
Swap Agreement.

                  "Agreement": Agreement shall have the meaning specified in
the Preliminary Statement to this Series Supplement.

                  "Base Trust Agreement": Base Trust Agreement shall have the
meaning specified in the Preliminary Statement to this Series Supplement.

                  "Business Day": Any day other than a Saturday, Sunday or a
day on which banking institutions in New York, New York or London, England are
authorized or obligated by law, executive order or governmental decree to be
closed.

                  "Calculation Agent": Wachovia Bank, National Association, in
its capacity as calculation agent under the Swap Agreement.

                  "Certificate Account": With respect to this Series, the
Eligible Account, which shall be a securities account established and
maintained by the Securities Intermediary in the Trustee's name, to which the
Underlying Securities and all payments made on or with respect to the related
Underlying Securities and all payments made to the Trust on or with respect to
the Swap Agreement shall be credited.

                  "Certificateholder" or "Holder": With respect to any
Certificate, the Holder thereof.

                  "Certificateholders" or "Holders": The Holders of the
Certificates.

                  "Certificates": Certificates shall have the meaning
specified in the Preliminary Statement to this Series Supplement.

                  "Closing Date": September 30, 2005.

                  "Collateral Account": With respect to this Series, the
Eligible Account, which shall be a securities account established and
maintained by the Securities Intermediary in the Trustee's name, to which any
Posted Collateral and all proceeds thereof shall be credited in accordance
with the Swap Agreement.

                  "Collection Period": The period from (but excluding) the
preceding Distribution Date (or, in the case of the first Distribution Date,
from and including the Closing Date), through and including the current
Distribution Date.

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                  "Corporate Trust Office": U.S. Bank Trust National
Association, 100 Wall Street, Suite 1600, New York, New York 10005 or such
other corporate trust office as the Trustee shall designate in writing to the
Trustor and the Certificateholders.

                  "Defaulting Party": Shall have the meaning provided under
the Swap Agreement.

                  "Deferral Period": Any period during which Interest
Collections payable on a Scheduled Distribution Date will not be paid as a
result of the deferral of interest payments on the Junior Subordinated
Debentures and, consequently, on the Underlying Securities.

                  "Depositary": The Depositary Trust Company.

                  "Depositor": The Trustor acting specifically with respect to
the conveyance of the Underlying Securities under this Series Supplement.

                  "Distribution Date": Any Scheduled Distribution Date, the
Maturity Date or any Underlying Securities Default Distribution Date or, if
applicable, any Underlying Securities Redemption Distribution Date.

                  "Interest Collections": For any Distribution Date, the sum
of (i) all amounts received during the Collection Period ending on such
Distribution Date from the Swap Counterparty pursuant to the Swap Agreement
and (ii) any amounts representing interest on the Underlying Securities that
are actually received by the Trust pursuant to the Underlying Securities on
such Distribution Date and not required to be paid to the Swap Counterparty
pursuant to the Swap Agreement.

                  "Junior Subordinated Debentures": 6.345% junior subordinated
debentures due February 15, 2034 issued by the Underlying Securities
Guarantor.

                  "Maturity Date": February 15, 2034.

                  "Optional Exchange": Any exchange of Certificates held by
the Depositor for Underlying Securities under Section 39 of this Series
Supplement.

                  "Payment Default": A default by the Underlying Securities
Issuer in the payment of any amount due on the Underlying Securities after the
same becomes due and payable on any Underlying Securities Payment Date (and
the expiration of any applicable grace period on the Underlying Securities).

                  "Place of Distribution": New York, New York.

                  "Posted Collateral": Shall have the meaning provided under
the Swap Agreement.

                  "Rating Agency": S&P and any successor thereto. References
to "the Rating Agency" in the Agreement shall be deemed to be such credit
rating agency.

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                  "Record Date": With respect to any Distribution Date, the
day immediately preceding such Distribution Date.

                  "S&P": Standard & Poor's Ratings Services or any successor
thereto.

                  "Scheduled Distribution Date": (a) For so long as the Swap
Agreement shall not have been terminated, and no Deferral Period shall have
occurred, the 15th day of each calendar month, or, if any such day is not a
Business Day, then the immediately following Business Day, commencing October
15, 2005, until the date on which the Certificates have been retired;
provided, however, that payment on each Scheduled Distribution Date shall be
subject to prior payment of interest or principal, as applicable, on the
Underlying Securities or

                  (b) following (i) a Swap Agreement Termination Event that is
not also a Trust Termination Event or (ii) a Deferral Period, subject to the
conditions set forth in Section 10(d) herein, Scheduled Distribution Dates
will thereafter occur semi-annually on each February 15 and August 15, or the
immediately following Business Day, until the Certificates have been retired.

                  "SEC Reporting Failure": Any circumstance in which the
Underlying Securities Guarantor either (x) states in writing that it intends
permanently to cease filing periodic reports required under the Securities
Exchange Act of 1934 or (y) fails to file its required periodic reports for
any quarterly reporting period, and (2) the Trustor determines after
consultation with the Securities and Exchange Commission, that under
applicable securities laws, rules or regulations the Trust must be liquidated
or the Underlying Securities distributed.

                  "Specified Currency": United States Dollars.

                  "Swap Agreement": The ISDA Master Agreement dated as of the
Closing Date, between the Trust and the Swap Counterparty (including the
Schedule thereto) as supplemented by Confirmation Number 1217475, in the form
attached hereto as Exhibit D.

                  "Swap Agreement Termination Event": The occurrence of any
"Event of Default" or "Termination Event" under the Swap Agreement.

                  "Swap Counterparty": Wachovia Bank, N.A., or any permitted
successor or assign thereto.

                  "Trust": STRATS(SM) Trust For Goldman Sachs Capital I
Securities, Series 2005-3.

                  "Trust Termination Event": (a) the payment in full at
maturity or upon early redemption of the Certificates, (b) the final
distribution of the proceeds received upon a recovery on the Underlying
Securities (after deducting the costs incurred in connection therewith) after
an Acceleration or other default with respect to the Underlying Securities
(and the expiration of any applicable grace period on the Underlying
Securities), (c) the distribution (or liquidation and distribution) of the
Underlying Securities in accordance with Section 10(i) hereof in the event of
an SEC Reporting Failure, (d) any Swap Agreement Termination Event pursuant to
which the Trust is the Defaulting Party or an Affected Party and amounts are
owed by the Trust under the

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Swap Agreement that are in excess of the redemption proceeds or other current
distributions on the Underlying Securities or (e) any Optional Exchange of all
Certificates then outstanding.

                  "Underlying Securities": (a) As of the Closing Date,
$40,000,000 (by aggregate liquidation amount) of 6.345% Capital Securities due
February 15, 2034 issued by the Underlying Securities Issuer, sold to the
Trustee by Wachovia Securities and identified on Exhibit A hereto or (b) an
aggregate principal amount of Junior Subordinated Debentures equal to a
corresponding aggregate liquidation amount of Underlying Securities
distributed or exchanged for the Underlying Securities by the Underlying
Securities Issuer or the Underlying Securities Guarantor.

                  "Underlying Securities Default Distribution Date": The date
on which the Trustee makes a final distribution of the proceeds received in
connection with a recovery on the Underlying Securities (in the case of
Payment Default, after deducting any costs incurred in connection therewith)
following a Payment Default or an Acceleration or other default with respect
to the Underlying Securities.

                  "Underlying Securities Guarantor": The Goldman Sachs Group,
Inc.

                  "Underlying Securities Issuer": Goldman Sachs Capital I.

                  "Underlying Securities Payment Date": The 15th day of each
February and August ending on February 15, 2034; provided, however, that if
any Underlying Securities Payment Date would otherwise fall on a day that is
not a Business Day, such Underlying Securities Payment Date will be the
following Business Day.

                  "Underlying Securities Redemption Distribution Date":
Any date on which the payment of the principal of the Underlying Securities,
either in whole or in part, is paid to the Trustee, except that to the extent
that the Junior Subordinated Debentures are distributed to the Trustee by the
Underlying Securities Issuer, no Underlying Securities Redemption Distribution
Date shall have occurred.

                  "Underlying Securities Trustee": The trustee for the
Underlying Securities.

                  "Unpaid Amounts": As to the Trust or the Swap Counterparty,
respectively, an amount equal to the regular scheduled payments that such
party is otherwise required to make under the Swap Agreement, through, but
excluding, the date on which the Swap Agreement is terminated.

                  "Voting Rights": The Certificateholders shall have 100% of
the total Voting Rights with respect to the Certificates and shall be
allocated among all Holders of Certificates in proportion to the Stated
Amounts held by such Holders on any date of determination.

                  "Wachovia Securities": Wachovia Capital Markets, LLC.

                  Section 2. Creation and Declaration of Trust; Sale of
Underlying Securities; Acceptance by Trustee. (a) The Trust, of which the
Trustee is the trustee, is hereby created

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under the laws of the State of New York for the benefit of the holders of the
Certificates and the Swap Counterparty. The Trust shall be irrevocable.

                  (b) The Trustor, acting as Depositor, does hereby sell,
assign, convey and set-over to the Trustee, on behalf and for the benefit of
the Trust, the Underlying Securities at a purchase price of $42,320,550 in
cash. The Trustee shall pay the full purchase price for the Underlying
Securities by delivering to Wachovia Securities, for the account of the
Depositor, and as the assignee of Depositor with respect to such amounts, (i)
$42,003,300 on the Closing Date and (ii) $317,250 on February 15, 2006, which
represents the accrued and unpaid interest of the Underlying Securities on the
Closing Date. The amounts to be paid to Wachovia Securities set forth in
clause (i) above, shall be paid from the proceeds of the issuance of the
Certificates to be received by the Trustee on the Closing Date. The amounts to
be paid to Wachovia Securities set forth in clause (ii) above, shall be paid
from the interest payment on the Underlying Securities to be received by the
Trustee on February 15, 2006. In the event that such interest payment on the
Underlying Securities is not received by the Trustee on such date or is
otherwise insufficient to pay such amount of accrued and unpaid interest to
Wachovia Securities, Wachovia Securities, for the account of the Depositor,
and as assignee of Depositor with respect to such amounts, shall have a claim
for the unpaid portion of such amount and shall share pari passu with
Certificateholders to the extent of such claim in the proceeds from the sale
or recovery of the Underlying Securities. The Trustor hereby instructs the
Trustee on behalf of and for the benefit of the Trust to enter into and
execute the Swap Agreement and perform the obligations thereunder on behalf of
the Trust, including, but not limited to, receiving and returning any
collateral posted by the Swap Counterparty in accordance with the Swap
Agreement.

                  (c) The Trustee hereby (i) acknowledges such sale, deposit
and delivery, pursuant to subsection (b) above, and receipt by it of the
Underlying Securities, (ii) acknowledges receipt of the duly authorized and
executed Swap Agreement, (iii) accepts the trusts created hereunder in
accordance with the provisions hereof and of the Base Trust Agreement but
subject to the Trustee's obligation, as and when the same may arise, to make
any payment or other distribution of the assets of the Trust as may be
required pursuant to this Series Supplement, the Base Trust Agreement, the
Certificates and the Swap Agreement, and (iv) agrees to perform the duties
herein or therein required and any failure to receive reimbursement of
expenses and disbursements under Section 13 hereof shall not release the
Trustee from its duties herein or therein.

                  Section 3. Designation. There is hereby created a Series of
trust certificates to be issued pursuant to the Base Trust Agreement and this
Series Supplement to be known as the "STRATS(SM) Certificates, Series 2005-3".
The Certificates shall have the terms provided for in this Series Supplement.
The Certificates shall be issued in the amount set forth in Section 5 and with
the additional terms set forth in Exhibit B to this Series Supplement. The
Certificates shall be issued in substantially the form set forth in Exhibit C
to this Series Supplement with such necessary or appropriate changes as shall
be approved by the Trustor and the Trustee, such approval to be manifested by
the execution and authentication thereof by the Trustee. The Certificates
shall evidence undivided ownership interests in the assets of the Trust,
subject to the liabilities of the Trust and shall be payable solely from
payments or property received by the Trustee on or in respect of the
Underlying Securities and the Swap Agreement.

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                  Section 4. Date of the Certificates. The Certificates that
are authenticated and delivered by the Trustee to or upon Trustor Order on the
Closing Date shall be dated the Closing Date. All other Certificates that are
authenticated after the Closing Date for any other purpose under the Agreement
shall be dated the date of their authentication.

                  Section 5. Certificate Stated Amount and Denominations. On
the Closing Date, up to 40,000 Certificates with an aggregate Stated Amount of
$40,000,000 may be authenticated and delivered under the Base Trust Agreement
and this Series Supplement. The Stated Amount of the Certificates shall equal
100% of the initial principal amount of Underlying Securities sold to the
Trustee and deposited in the Trust. Such Stated Amount shall be calculated
without regard to Certificates authenticated and delivered upon registration
of transfer of, or in exchange for, or in lieu of, other Certificates pursuant
to Sections 5.3, 5.4 or 5.5 of the Base Trust Agreement.

                  Section 6. Currency of the Certificates. All distributions
on the Certificates will be made in the Specified Currency.

                  Section 7. Form of Securities. The Trustee shall execute and
deliver the Certificates in the form of one or more global certificates
registered in the name of the Depositary or its nominee.

                  Section 8. Swap Payments; Collateral Account. (a) The Trust
shall pay to the Swap Counterparty (i) for so long as the Swap Agreement shall
not have been terminated, except during a Deferral Period, an amount equal to
all interest payments received by the Trust in respect of the Underlying
Securities on each Underlying Securities Payment Date, excluding any amount of
interest that accrued with respect to the Underlying Securities from the
Underlying Securities Payment Date immediately preceding the Closing Date to,
but excluding, the Closing Date and (ii) all other amounts owing to the Swap
Counterparty under the Swap Agreement to the extent Trust assets are
sufficient therefor, including but not limited to all Unpaid Amounts upon the
occurrence of any Swap Agreement Termination Event.

                  (b) In the event that any payment with respect to the
Underlying Securities is not received by the Trustee by 12 noon (New York City
time) on an Underlying Securities Payment Date as a result of any Deferral
Period, the Trustee shall not make any payment to the Swap Counterparty on
such Underlying Securities Payment Date. If any payment with respect to the
Underlying Securities is made to the Trustee after an Underlying Securities
Payment Date on which such payment was due, the Trustee shall promptly
distribute such amount received to the Swap Counterparty on any date the
Trustee receives such payment, or as soon as practicable thereafter.

                  (c) The Trustee shall within 3 Business Days of the Closing
Date establish the Collateral Account. Any and all amounts at any time on
deposit in the Collateral Account shall be held in trust by the Trustee for
the benefit of Certificateholders and the Swap Counterparty; provided, that,
the only permitted withdrawal from or application of funds on deposit in, or
otherwise to the credit of, the Collateral Account shall be (i) for
application to obligations of the Swap Counterparty to the Trust under the
Swap Agreement in accordance with the terms of the Swap Agreement or (ii) to
return Posted Collateral to the Swap Counterparty when and as

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required by the Swap Agreement, which the Trustee shall return to the Swap
Counterparty in accordance with the related Swap Agreement.

                  Section 9. Certain Provisions of Base Trust Agreement Not
Applicable. The provisions of Sections 5.11, 5.16, 6.2, Article VII, 8.1, 8.2
and 8.10 of the Base Trust Agreement and any other provision of the Base Trust
Agreement which imposes obligations on or creates rights in favor of the
Trustee or the Certificateholders as a result of or in connection with an
"Event of Default" or "Administrative Agent Termination Event" shall be
inapplicable with respect to the Certificates. In addition, there is no
"Administrative Agent" specified herein, and all references to "Administrative
Agent" in the Base Trust Agreement, therefore shall be inapplicable with
respect to the Certificates.

                  Section 10. Distributions. (a) On each Distribution Date,
except during any Deferral Period during which no distributions to
Certificateholders shall be made, so long as no Swap Agreement Termination
Event has occurred for which the Trust is the Defaulting Party or an Affected
Party, the Trustee shall distribute to the Certificateholders the Interest
Collections. On the Maturity Date, and to the extent received on any other
Scheduled Distribution Date or any Underlying Securities Redemption
Distribution Date, so long as no Swap Agreement Termination Event has occurred
for which the Trust is the Defaulting Party or an Affected Party, the Trustee
shall distribute to the Certificateholders, the principal amount of the
Underlying Securities to the extent the principal of the Underlying Securities
is received by the Trustee on such date or during the related Collection
Period plus any accrued interest thereon.

                  (b) If a Swap Agreement Termination Event has occurred for
which the Trust is the Defaulting Party or an Affected Party, the Trustee,
first, shall distribute all collections received on the Underlying Securities
to the Swap Counterparty until all amounts owing to the Swap Counterparty
under the Swap Agreement for payments in connection with such Swap Agreement
Termination Event (including any Unpaid Amounts) have been paid in full and,
second, shall distribute all remaining amounts to the Certificateholders. If
the distribution in the preceding sentence is insufficient to pay in full all
amounts owing to the Swap Counterparty, the Trustee shall proceed to liquidate
or distribute the Underlying Securities in accordance with Section 10(i). Upon
any liquidation of the Underlying Securities, the Trustee, first, shall
distribute the proceeds thereof to the Swap Counterparty until all amounts
owing to the Swap Counterparty have been paid in full and, second, shall
distribute all remaining amounts to the Certificateholders. In the event of a
Swap Agreement Termination Event, after paying all amounts due to the Swap
Counterparty as set forth in the first sentence of this Section 10(b), if no
Trust Termination Event has occurred, all Interest Collections shall
thereafter be distributed to Certificateholders on each applicable
Distribution Date. If a Swap Agreement Termination Event has occurred for
which the Swap Counterparty is the Defaulting Party or the only Affected
Party, notwithstanding the termination of the Swap Agreement, the Trustee
shall distribute any Unpaid Amounts to the Swap Counterparty from Interest
Collections on the Underlying Securities.

                  (c) In all cases hereunder, except as provided in
subsections 8(b) and 10(d) hereof, if any payment with respect to the
Underlying Securities is made to the Trustee after the Underlying Securities
Payment Date on which such payment was due, the Trustee shall distribute such
amount received on the Business Day following such receipt.

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                  (d) Upon the occurrence of any Deferral Period (i) the
Trustee shall not be obligated to distribute Interest Collections on any
Scheduled Distribution Date until (x) payments on the Underlying Securities
have resumed and (y) all amounts due and payable on the Underlying Securities
have been received by the Trust and any amounts owed to the Swap Counterparty
under the Swap Agreement have been paid to the Swap Counterparty. Upon the
satisfaction of these conditions, the Trustee shall distribute the Interest
Collections to Certificateholders in accordance with subsection 10(a) above.

                  (e) In the event of a Payment Default while the Swap
Agreement is in effect and if any payment is due to the Swap Counterparty, the
Underlying Securities will be liquidated in accordance with Section 10(i).
Otherwise, in the event of a Payment Default, the Trustee shall proceed
against the Underlying Securities Issuer on behalf of the Certificateholders
to enforce the Underlying Securities or otherwise to protect the interests of
the Certificateholders, subject to the receipt of indemnity in form and
substance satisfactory to the Trustee; provided, that Holders of the
Certificates representing a majority of the Voting Rights on the Certificates
will be entitled to direct the Trustee in any such proceeding or direct the
Trustee to sell the Underlying Securities, subject to the Trustee's receipt of
satisfactory indemnity.

                  (f) In the event of an Acceleration and a corresponding
payment on the Underlying Securities prior to any liquidation of the
Underlying Securities hereunder, the Trustee shall distribute the proceeds to
the Certificateholders no later than two (2) Business Days after the receipt
of immediately available funds pursuant to Section 10(b).

                  (g) In the event the Trustee receives property other than
cash in respect of the Underlying Securities such property will be applied
first, to the Swap Counterparty until all amounts owing to the Swap
Counterparty have been paid in full and, second, to the Certificateholders.
Property other than cash will be liquidated by the Trustee, and the proceeds
thereof distributed in cash, to the extent necessary to pay to the Swap
Counterparty all amounts owed to it under the Swap Agreement and, thereafter,
to the extent necessary to avoid distribution of fractional securities to
Certificateholders. In-kind distribution of Underlying Securities or other
property to Certificateholders will be deemed to reduce the Stated Amount of
Certificates on a proportionate basis. Following such in-kind distribution,
all Certificates will be cancelled. No amounts will be distributed to the
Trustor in respect of the Underlying Securities. The Swap Counterparty shall
direct the Trustee with respect to any liquidation of such property to the
extent of the full amount owed to it under the Swap Agreement.

                  (h) If an SEC Reporting Failure occurs, then the Trustor
shall promptly notify the Trustee, the Swap Counterparty and the Rating Agency
of such SEC Reporting Failure and the Trustee shall, only if instructed by the
Trustor, proceed to liquidate or distribute the Underlying Securities in
accordance with Section 10(i).

                  (i) If at any time, the Trustee is directed to sell the
Underlying Securities, the Trustee shall solicit bids for the sale of the
Underlying Securities with settlement thereof on or before the third (3rd)
Business Day after such sale from three leading dealers in the relevant
market, which may include but is not limited to any three of the following
dealers: (1) Wachovia Securities, (2) Goldman, Sachs & Co., (3) Lehman
Brothers Inc., (4) Merrill Lynch, Pierce, Fenner & Smith Incorporated, (5)
Citigroup Global Markets Inc., (6) J.P. Morgan Securities Inc.

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and (7) Deutsche Bank Securities Inc.; provided, however, that no bid from
Wachovia Securities or any affiliate thereof shall be accepted unless such bid
equals the then fair market value of such Underlying Securities. The Trustee
shall not be responsible for the failure to obtain a bid so long as it has
made reasonable efforts to obtain bids. If a bid for the sale of the
Underlying Securities has been accepted by the Trustee but the sale has failed
to settle on the proposed settlement date, the Trustee shall request new bids
from such leading dealers. In any circumstance in which the sale of the
Underlying Securities is required hereunder, the Trustee shall, to the extent
it is so directed by the Trustor, provide Certificateholders with the option
to elect to receive an "in-kind" distribution of their pro rata share of the
Underlying Securities; provided, that, (1) an in-kind distribution shall be
subject to the prior sale of Underlying Securities in accordance with the
provisions of this Section 10(i) to the extent necessary, to pay any amounts
owing to the Swap Counterparty under Section 10(b), (2) a Certificateholders'
pro rata share of the Underlying Securities shall be a principal amount of
Underlying Securities equal to the aggregate principal amount of the
Underlying Securities minus the amount required to be distributed to the Swap
Counterparty pursuant to the second sentence of Section 10(b) multiplied by a
fraction the numerator of which is the Stated Amount of that holder's
Certificates and the denominator of which is the aggregate principal amount of
the Underlying Securities and (3) odd-lot amounts that cannot be distributed
in-kind because they are not within the authorized denominations of the
Underlying Securities shall be distributed in cash. Any such in-kind
distribution shall constitute the final distribution in respect of the
Certificates as to which such option is exercised.

                  (j) Distributions to the Certificateholders on each
Distribution Date will be made to the Certificateholders of record on the
Record Date.

                  (k) All distributions to Certificateholders shall be
allocated pro rata among the Certificates based on their respective
Outstanding Amounts as of the Record Date.

                  (l) Notwithstanding any provision of the Agreement to the
contrary, to the extent funds are available, the Trustee will initiate payment
in immediately available funds by 1:00 P.M. (New York City time) on each
Distribution Date of all amounts payable to each Certificateholder with
respect to any Certificate held by such Certificateholder or its nominee
(without the necessity for any presentation or surrender thereof or any
notation of such payment thereon) in the manner and at the address as each
Certificateholder may from time to time direct the Trustee in writing 15 days
prior to such Distribution Date requesting that such payment will be so made
and designating the bank account to which such payments shall be so made. The
Trustee shall be entitled to rely on the last instruction delivered by the
Certificateholder pursuant to this Section 10(g) unless a new instruction is
delivered 15 days prior to a Distribution Date.

                  (m) The rights of the Certificateholders to receive
distributions in respect of the Certificates, and all interests of the
Certificateholders in such distributions, shall be as set forth in this Series
Supplement. The Trustee shall in no way be responsible or liable to the
Certificateholders nor shall any Certificateholder in any way be responsible
or liable to any other Certificateholder in respect of amounts previously
distributed on the Certificates based on their respective Outstanding Amounts.

                  Section 11. Termination of Trust. (a) The Trust shall
terminate upon the occurrence of any Trust Termination Event.

                                      10
<PAGE>

                  (b) Except for any reports and other information required
to be provided to Certificateholders hereunder and under the Base Trust
Agreement and except as otherwise specified herein and therein, the
obligations of the Trustee will terminate upon the distribution to the Swap
Counterparty and Certificateholders of all amounts required to be distributed
to them and the disposition of all Underlying Securities held by the Trustee.
The Trust shall thereupon terminate, except for surviving rights of indemnity.

                  Section 12. Limitation of Powers and Duties. (a) The Trustee
shall administer the Trust and the Underlying Securities solely as specified
herein and in the Base Trust Agreement.

                  (b) The Trust is constituted solely for the purpose of
acquiring and holding the Underlying Securities, entering into and performing
its obligations under the Swap Agreement and issuing the Certificates. The
Trustee is not authorized to acquire any other investments or engage in any
activities not authorized herein and, in particular, unless expressly provided
in the Agreement, the Trustee is not authorized (i) to sell, assign, transfer,
exchange, pledge, set-off or otherwise dispose of any of the Underlying
Securities, once acquired, or interests therein, including to
Certificateholders, (ii) to merge or consolidate the Trust with any other
entity, or (iii) to do anything that would materially increase the likelihood
that the Trust will fail to qualify as a grantor trust for United States
federal income tax purposes. In addition, the Trustee has no power to create,
assume or incur indebtedness or other liabilities in the name of the Trust
other than as contemplated herein and in the Base Trust Agreement.

                  (c) The parties acknowledge that the Trustee, as the holder
of the Underlying Securities, has the right to vote and give consents and
waivers in respect of the Underlying Securities and enforce the other rights,
if any, of a holder of the Underlying Securities, except as otherwise limited
by the Base Trust Agreement or this Series Supplement. In the event that the
Trustee receives a request from the Underlying Securities Trustee, the
Underlying Securities Issuer, the Underlying Securities Guarantor or, if
applicable, the Depositary with respect to the Underlying Securities, for the
Trustee's consent to any amendment, modification or waiver of the Underlying
Securities, or any document relating thereto, or receives any other
solicitation for any action with respect to the Underlying Securities, the
Trustee shall within two (2) Business Days mail a notice of such proposed
amendment, modification, waiver or solicitation to the Swap Counterparty and
each Certificateholder of record as of the date of such request. The Trustee
shall request instructions from the Certificateholders as to what action to
take in response to such request and shall be protected in taking no action if
no direction is received. Except as otherwise provided herein, the Trustee
shall consent or vote, or refrain from consenting or voting, in the same
proportion (based on the Stated Amounts of the Certificates of each Class as
allocated based on the respective Voting Rights of each Class) as the
Certificates were actually voted or not voted by the Holders thereof as of the
date determined by the Trustee prior to the date such vote or consent is
required; provided, however, that, notwithstanding anything to the contrary in
the Base Trust Agreement or this Series Supplement, the Trustee shall at no
time vote in favor of or consent to any matter (i) which would alter the
timing or amount of any payment on the Underlying Securities (including,
without limitation, any demand to accelerate the Underlying Securities) or
(ii) which would result in the exchange or substitution of any Underlying
Security whether or not pursuant to a plan for the refunding or refinancing of
such Underlying Security, except in each case with the unanimous consent of
the Certificateholders;

                                      11
<PAGE>

provided, further, that the Trustee shall not take any such action if it would
affect the method, amount or timing of payments due to the Swap Counterparty
or otherwise materially adversely affect the interests of the Swap
Counterparty under the Swap Agreement and result in a Swap Agreement
Termination Event, in each case without the prior written consent of the Swap
Counterparty. The Trustee shall have no liability for any failure to act or to
refrain from acting resulting from the Certificateholders' late return of, or
failure to return, directions requested by the Trustee from the
Certificateholders.

                  (d) Notwithstanding any provision of the Agreement to the
contrary, the Trustee may require from the Certificateholders prior to taking
any action at the direction of the Certificateholders, an indemnity agreement
of a Certificateholder or any of its Affiliates to provide for security or
indemnity against the costs, expenses and liabilities the Trustee may incur by
reason of any such action. An unsecured indemnity agreement, if acceptable to
the Trustee, shall be deemed to be sufficient to satisfy such security or
indemnity requirement.

                  (e) Notwithstanding any provision of the Agreement to the
contrary, the Trustee shall act as the sole Authenticating Agent, Paying Agent
and Registrar.

                  Section 13. Compensation of Trustee. The Trustee shall be
entitled to receive from the Trustor as compensation for its services
hereunder, trustee's fees pursuant to a separate agreement between the Trustee
and the Trustor, and shall be reimbursed for all reasonable expenses,
disbursements and advances incurred or made by it (including the reasonable
compensation, disbursements and expenses of its counsel and other persons not
regularly in its employ). The Trustor shall indemnify and hold harmless the
Trustee and its successors, assigns, agents and servants against any and all
loss, liability or reasonable expense (including attorney's fees) incurred by
it in connection with the administration of this trust and the performance of
its duties thereunder. The Trustee shall notify the Trustor promptly of any
claim for which it may seek indemnity. Failure by the Trustee to so notify the
Trustor shall not relieve the Trustor of its obligations hereunder. The
Trustor need not reimburse any expense or indemnify against any loss,
liability or expense incurred by the Trustee through the Trustee's own willful
misconduct, negligence or bad faith. The indemnities contained in this Section
13 shall survive the resignation or termination of the Trustee or the
termination of this Agreement.

                  Failure by the Trustor to pay, reimburse or indemnify the
Trustee shall not entitle the Trustee to any payment, reimbursement or
indemnification from the Trust, nor shall such failure release the Trustee
from the duties it is required to perform under this Series Supplement. Any
unpaid, unreimbursed or unindemnified amounts shall not be borne by the Trust
and shall not constitute a claim against the Trust, but shall be borne by the
Trustee in its individual capacity, and the Trustee shall have no recourse
against the Trust with respect thereto.

                  Section 14. Modification or Amendment of the Base Trust
Agreement, the Series Supplement or the Swap Agreement. (a) The Trustee shall
not enter into any modification or amendment of the Base Trust Agreement or
this Series Supplement unless such modification or amendment is in accordance
with Section 10.1 of the Base Trust Agreement. If the Rating Agency Condition
is not satisfied with respect to any proposed modification or amendment of the
Base Trust Agreement or this Series Supplement, then any such modification or
amendment must be approved by 100% of the Certificateholders. The Trustee
shall not enter into any

                                      12
<PAGE>

amendment or modification of this Agreement that would affect the method,
amount or timing of payment due to the Swap Counterparty or the consent rights
of the Swap Counterparty hereunder or otherwise materially adversely affect
the interests of the Swap Counterparty under the Swap Agreement and result in
a Swap Agreement Termination Event, in each case without the prior written
consent of the Swap Counterparty. The Trustee shall provide fifteen Business
Days written notice to the Swap Counterparty before entering into any
amendment or modification of this Agreement pursuant to this Section 14.

                  (b) The Trustee shall not enter into any modification or
amendment of the Swap Agreement without the prior written consent of holders
of Certificates representing 66 ?% of the Voting Rights and without prior
written confirmation from the Rating Agency that such amendment will not
result in a reduction or withdrawal of the then current rating of the
Certificates; provided, however, that each of the Swap Counterparty and the
Trustee may amend the Swap Agreement without the prior written consent of
Certificateholders to cure any ambiguity in, or to correct or supplement any
provision of the Swap Agreement which may be inconsistent with any other
provision of the Swap Agreement, or to otherwise cure any defect in the Swap
Agreement, provided that any such amendment does not materially adversely
affect the interest of the Certificateholders and that the Rating Agency will
have given its prior written confirmation that such amendment will not result
in a reduction or withdrawal of the then current rating of the Certificates;
provided further, however, that notwithstanding anything to the contrary, no
amendment may alter the timing or amount of any payment on the Swap Agreement
without the prior consent of 100% of the Certificateholders and without giving
the Rating Agency prior written notice of any such amendment.

                  (c) Until a Responsible Officer of the Trustee has actual
knowledge of the occurrence of an event that would constitute a Swap Agreement
Termination Event, the Trustee shall be entitled to assume (and shall be fully
protected, indemnified and held harmless in doing so) that no Swap Agreement
Termination Event has occurred and may accordingly seek instructions under
Section 12 and this Section 14 exclusively from the Swap Counterparty.

                  Section 15. Assignment of Rights under the Swap Agreement.
The Trustee may consent to any transfer or assignment by the Swap Counterparty
of its rights under the Swap Agreement, so long as the Rating Agency shall
have given its prior written confirmation that such transfer or assignment
will not result in a reduction or withdrawal of the then current rating of the
Certificates.

                  Section 16. Accounting. Notwithstanding Section 3.16 of the
Base Trust Agreement, "Independent Public Accountants' Administration Report,"
no such accounting reports shall be required. Pursuant to Section 4.2 of the
Base Trust Agreement, "Reports to Certificateholders," the Trustee shall cause
the statement described in Section 4.2 to be prepared and forwarded as
provided therein.

                  Section 17. No Investment of Amounts Received on Underlying
Securities. All amounts received on or with respect to the Underlying
Securities and all payments made to the Trust on or with respect to the Swap
Agreement shall be held uninvested by the Trustee.

                                      13
<PAGE>

                  Section 18. No Event of Default. There shall be no Events of
Default defined with respect to the Certificates.

                  Section 19. Notices. (a) All directions, demands and notices
hereunder and under the Agreement shall be in writing and shall be deemed to
have been duly given when received if personally delivered or mailed by first
class mail, postage prepaid or by express delivery service or by certified
mail, return receipt requested or delivered in any other manner specified
herein, (i) in the case of the Trustor, to Synthetic Fixed-Income Securities,
Inc., One Wachovia Center 301 South College Street, DC-7 Charlotte, NC 28288,
Attention: Structured Notes Desk, or such other address as may hereafter be
furnished to the Trustee in writing by the Trustor, and (ii) in the case of
the Trustee, to U.S. Bank Trust National Association, 100 Wall Street, Suite
1600, New York, New York 10005, Attention: Corporate Trust, facsimile number
(212) 809-5459, or such other address as may hereafter be furnished to the
Trustor in writing by the Trustee.

                  (b) For purposes of delivering notices to the Rating Agency
under Section 10.07 of the Base Trust Agreement, "Notice to Rating Agency," or
otherwise, such notices shall be mailed or delivered as provided in such
Section 10.07, "Notice to Rating Agency," to: Standard & Poor's Ratings
Services, 55 Water Street, New York, New York 10041; or such other address as
the Rating Agency may designate in writing to the parties hereto.

                  (c) In the event a Payment Default or an Acceleration
occurs, the Trustee shall promptly give notice to the Swap Counterparty and to
the Depositary or, for any Certificates which are not then held by the
Depositary or any other depository, directly to the registered holders of the
Certificates thereof. Such notice shall set forth (i) the identity of the
issue of Underlying Securities, (ii) the date and nature of such Payment
Default or Acceleration, (iii) the principal amount of the interest or
principal in default, (iv) the Certificates affected by the Payment Default or
Acceleration, and (v) any other information which the Trustee may deem
appropriate.

                  (d) Notwithstanding any provisions of the Agreement to the
contrary, the Trustee shall deliver all notices or reports required to be
delivered to or by the Trustee or the Trustor to the Certificateholders or the
Swap Counterparty without charge to such Certificateholders or the Swap
Counterparty.

                  (e) The Trustee shall, in connection with any notice or
delivery of documents to Certificateholders (whether or not such notice or
delivery is required pursuant to the Agreement), provide such notice or
documents to the Swap Counterparty concurrently with the delivery thereof to
the Certificateholders.

                  Section 20. Access to Certain Documentation. Access to
documentation regarding the Underlying Securities will be afforded without
charge to any Certificateholder so requesting pursuant to Section 3.17 of the
Base Trust Agreement, "Access to Certain Documentation." Additionally, the
Trustee shall provide at the request of any Certificateholder without charge
to such Certificateholder the name and address of each Certificateholder of
Certificates hereunder as recorded in the Certificate Register for purposes of
contacting the other Certificateholders with respect to their rights hereunder
or for the purposes of effecting purchases or sales of the Certificates,
subject to the transfer restrictions set forth herein.

                                      14
<PAGE>

                  Section 21. Advances. There is no Administrative Agent
specified herein; hence no person (including the Trustee) shall be permitted
or obligated to make Advances as described in Section 4.3 of the Base Trust
Agreement, "Advances."

                  Section 22. Ratification of Agreement. With respect to the
Series issued hereby, the Base Trust Agreement (including the grant of a
security interest in Section 10.8 of the Base Trust Agreement with respect to
the Underlying Securities conveyed hereunder), as supplemented by this Series
Supplement, is in all respects ratified and confirmed, and the Base Trust
Agreement as so supplemented by this Series Supplement shall be read, taken
and construed as one and the same instrument. To the extent there is any
inconsistency between the terms of the Base Trust Agreement and this Series
Supplement, the terms of this Series Supplement shall govern.

                  Section 23. Counterparts. This Series Supplement may be
executed in any number of counterparts, each of which so executed shall be
deemed to be an original, but all of such counterparts shall together
constitute but one and the same instrument.

                  Section 24. Governing Law. This Series Supplement and each
Certificate issued hereunder shall be governed by and construed in accordance
with the laws of the State of New York applicable to agreements made and to be
performed entirely therein without reference to such State's principles of
conflicts of law to the extent that the application of the laws of another
jurisdiction would be required thereby, and the obligations, rights and
remedies of the parties hereunder shall be determined in accordance with such
laws. The State of New York is the securities intermediary's jurisdiction of
the Securities Intermediary for purposes of the UCC.

                  Section 25. Certificate of Compliance. The Trustor shall
deliver to the Trustee and the Swap Counterparty on or prior to June 30 of
each year prior to a Trust Termination Event the Officer's Certificate as to
compliance as required by Section 6.1(b) of the Base Trust Agreement.

                  Section 26. Certain Filing to be Made by the Trustee. In the
event that an event requiring the sale of the Underlying Securities under this
Agreement occurs and the Underlying Securities are liquidated at a loss, the
Trustee will disclose pursuant to Treasury Regulation Section 1.6011-4 the
loss in accordance with the procedures of such regulation, unless the Trustee
obtains advice from counsel that such disclosure is not necessary. In general,
the Trustee will (x) attach a completed Form 8886 to its tax return in the
year the requisite loss occurs and (y) file a completed form with the Office
of Tax Shelter Analysis (OTSA) at: Internal Revenue Service LM:PFTG:OTSA,
Large and Midsize Business Division, 1111 Constitution Avenue., NW.,
Washington DC 20224 (or such other address subsequently required).

                  Section 27. Establishment of Accounts. The Securities
Intermediary and the Trustee hereby represent and warrant that:

                  (a) Each Account for the Trust is a "securities account"
within the meaning of Section 8-501 of the UCC and is held only in the name of
the Trustee on behalf of the Trust. The Securities Intermediary is acting in
the capacity of a "securities intermediary" within the meaning of Section
8-102(a)(14) of the UCC;

                                      15
<PAGE>

                  (b) All Underlying Securities have been (i) delivered to the
Securities Intermediary pursuant to the Agreement and (ii) credited to the
Certificate Account; and

                  (c) Each Account is an account to which financial assets are
or may be credited, and the Securities Intermediary shall treat the Trustee as
entitled to exercise the rights that comprise any financial asset credited to
the Accounts.

                  Section 28. Statement of Intent. It is the intention of the
parties hereto that, for purposes of federal income taxes, state and local
income and franchise taxes and any other taxes imposed upon, measured by or
based upon gross or net income, the Trust shall be treated as a grantor trust,
but failing that, as a partnership (other than a publicly traded partnership
taxable as a corporation) and, in any event, shall not be classified as a
corporation. The parties hereto agree that, unless otherwise required by
appropriate tax authorities, the Trustee shall file or cause to be filed
annual or other necessary returns, reports and other forms consistent with
such intended characterization. In the event that the Trust is characterized
by appropriate tax authorities as a partnership for federal income tax
purposes, each Certificateholder, by its acceptance of its Certificate, agrees
to report its respective share of the items of income, deductions, and credits
of the Trust on its respective returns. As further consideration for each
Certificateholder's purchase of a Certificate, each such Certificateholder is
deemed to agree not to irrevocably delegate to any person (for a period of
more than one year) authority to purchase, sell or exchange its Certificates.

                  Each Certificateholder (and each beneficial owner of a
Certificate) by acceptance of its Certificate (or its beneficial interest
therein) agrees, unless otherwise required by appropriate tax authorities, to
file its own tax returns and reports in a manner consistent with the
characterization indicated above.

                  Section 29. Filing of Partnership Returns. In the event that
the Trust is characterized (by appropriate tax authorities) as a partnership
for United States federal income tax purposes the Trustor agrees to reimburse
the Trust for any expenses associated with the filing of partnership returns
(or returns related thereto).

                  Section 30. "Financial Assets" Election. The Securities
Intermediary hereby agrees that the Underlying Securities credited to the
Certificate Account and any Posted Collateral credited to the Collateral
Account shall be treated as a "financial asset" within the meaning of Section
8-102(a)(9) of the UCC.

                  Section 31. Trustee's Entitlement Orders. If at any time the
Securities Intermediary shall receive any order from the Trustee directing the
transfer or redemption of any Underlying Securities credited to the Accounts,
the Securities Intermediary shall comply with such entitlement order without
further consent by the Trustor or any other Person. The Securities
Intermediary shall take all instructions (including without limitation all
notifications and entitlement orders) with respect to the Accounts solely from
the Trustee.

                  Section 32. Conflict with Other Agreements. The Securities
Intermediary hereby confirms and agrees that:

                                      16
<PAGE>

                  (a) There are no other agreements entered into between the
Securities Intermediary and the Trustor with respect to the Accounts. Each
Account and all property credited to the Account is not subject to, and the
Securities Intermediary hereby waives, any lien, security interest, right of
set off, or encumbrance in favor of the Securities Intermediary or any Person
claiming through the Securities Intermediary (other than the Trustee);

                  (b) It has not entered into, and until the termination of
the Agreement will not enter into, any agreement with any other Person
relating to the Accounts and/or any financial assets credited thereto pursuant
to which it has agreed to comply with entitlement orders of any Person other
than the Trustee; and

                  (c) It has not entered into, and until the termination of
the Agreement will not enter into, any agreement with any Person purporting to
limit or condition the obligation of the Securities Intermediary to comply
with entitlement orders as set forth in Section 31 hereof.

                  Section 33. Additional Trustee and Securities Intermediary
Representations. The Trustee and the Securities Intermediary each hereby
represents and warrants as follows:

                  (a) The Trustee and the Securities Intermediary each
maintains its books and records with respect to its securities accounts in the
State of New York;

                  (b) The Trustee and the Securities Intermediary each has not
granted any lien on the Underlying Securities nor are the Underlying
Securities subject to any lien on properties of the Trustee or the Securities
Intermediary in its individual capacity; the Trustee and the Securities
Intermediary each has no actual knowledge and has not received actual notice
of any lien on the Underlying Securities (other than any liens of the Trustee
in favor of the beneficiaries of the Trust Agreement); other than the
interests of the Trustee, the Certificateholders and the Swap Counterparty,
the books and records of the Trustee and the Securities Intermediary each do
not identify any Person as having an interest in the Underlying Securities;
and

                  (c) The Trustee and the Securities Intermediary each makes
no representation as to (i) the validity, legality, sufficiency or
enforceability of any of the Underlying Securities or (ii) the collectability,
insurability, effectiveness or suitability of any of the Underlying
Securities.

                  Section 34. Additional Trustor Representations. The Trustor
hereby represents and warrants to the Trustee as follows:

                  (a) Immediately prior to the sale of the Underlying
Securities to the Trustee, the Trustor, as Depositor, owned and had good and
marketable title to the Underlying Securities free and clear of any lien,
claim or encumbrance of any Person;

                  (b) The Trustor, as Depositor, has received all consents and
approvals required by the terms of the Underlying Securities to the sale to
the Trustee of its interest and rights in the Underlying Securities as
contemplated by the Agreement; and

                  (c) The Trustor has not assigned, pledged, sold, granted a
security interest in or otherwise conveyed any interest in the Underlying
Securities (or, if any such interest has been assigned, pledged or otherwise
encumbered, it has been released), except such interests sold

                                      17
<PAGE>

pursuant to the Agreement. The Trustor has not authorized the filing of and is
not aware of any financing statements against the Trustor that includes a
description of the Underlying Securities, other than any such filings pursuant
to the Agreement. The Trustor is not aware of any judgment or tax lien filings
against Trustor.

                  Section 35. Certification Requirements. The Trustee agrees
to obtain, at the Trustor's direction and expense, a report of an independent
public accountant sufficient for the Trustor on behalf of the Trust to satisfy
its obligations with respect to certification requirements under Rules 13a-14
and 15d-14 of the Exchange Act.

                  Section 36. Additional Rights of the Swap Counterparty.
Section 10.8 of the Base Trust Agreement is hereby modified for purposes of
this Series Supplement to provide that the security interest referred to and
created pursuant thereto in the Trust assets shall, in addition to the
obligations provided for under Section 10.8(b)(3), secure all of the
obligations of the Trustor and the Trust to the Swap Counterparty under the
Swap Agreement and this Agreement. The Swap Counterparty shall have the rights
of a third party beneficiary with respect to this Agreement.

                  Section 37. Modification of Certain Provisions of Base Trust
Agreement. The provisions of the Base Trust Agreement shall be modified as
they are applied with respect to this Series of Certificates to provide that
(i) notwithstanding Section 3.9 of the Base Trust Agreement, the Certificate
Account shall be held for the benefit of Certificateholders and the Swap
Counterparty and amounts in the Certificate Account shall be used to make
distributions to the Swap Counterparty as and when required under this Series
Supplement, (ii) the appointment of any successor of the Trustee under Section
8.7 of the Base Trust Agreement shall be subject to the prior approval of the
Swap Counterparty and (iii) notwithstanding Section 9.1(a) of the Base Trust
Agreement and subject to the proviso therein, the respective obligations and
responsibilities under this Agreement of the Trustor and the Trustee shall
terminate upon the distribution to Certificateholders and the Swap
Counterparty of all amounts held in all the Accounts and required to be paid
to such Holders or the Swap Counterparty pursuant to this Agreement and the
Swap Agreement on the Distribution Date coinciding with or following the final
payment on or other liquidation of the Underlying Securities and the
disposition of all amounts acquired therefrom in accordance with this
Agreement and the Swap Agreement and the disposition of the final payments
received under the Swap Agreement.

                  Section 38. Evidence of Integration for Tax Purposes. The
Trustee retains Exhibit E on behalf of each Certificateholder.

                  Section 39. Optional Exchange.

                  (a) On any Business Day occurring on or after October 15,
2005, subject to satisfaction of all of the conditions set forth in clause
(b), the Depositor may exchange Certificates held by it for a distribution of
Underlying Securities representing the same percentage of the Underlying
Securities as such Certificates represent of all outstanding Certificates.

                  (b) The following conditions shall apply to any Optional
Exchange:

                                      18
<PAGE>

                  (A) A notice specifying the number of Certificates being
         surrendered and the optional exchange date shall be delivered to the
         Trustee no less than 5 days (or such shorter period acceptable to the
         Trustee) but not more than 30 days before the optional exchange date.

                  (B) Certificates shall be surrendered to the trustee no
         later than 10:00 a.m. (New York City time) on the optional exchange
         date.

                  (C) The Trustee shall have received an opinion of counsel
         stating that the Optional Exchange would not cause the Trust to be
         classified as a corporation or publicly traded partnership taxable as
         a corporation for federal income tax purposes.

                  (D) The Trustee shall not be obligated to determine whether
         an Optional Exchange complies with the applicable provisions for
         exemption under Rule 3a-7 of the Investment Company Act of 1940, as
         amended, or the rules or regulations promulgated thereunder.

                  (E) The provisions of Section 4.5 of the Base Trust
         Agreement shall not apply to an Optional Exchange pursuant to this
         Section 39. This Section 39 shall not provide any Person with a lien
         against, an interest in or a right to specific performance with
         respect to the Underlying Securities; provided that satisfaction of
         the conditions set forth in this Section 39 shall entitle the
         Depositor to a distribution thereof.

                  (F) The aggregate principal balance of Certificates
         exchanged in connection with any Optional Exchange pursuant to this
         Section 39 shall be in an amount that results in a distribution of
         Underlying Securities in an even multiple of the minimum denomination
         of the Underlying Securities.

                  (G) No Swap Agreement Termination Event shall have occurred
         as a result of the Optional Exchange except to the extent of a
         termination resulting from the reduction in the Hedge Notional Amount
         (as defined in the Swap Agreement) to an amount equal to the
         principal amount of the Underlying Securities after giving effect to
         the Optional Exchange.

                  (H) Any payments due under the Swap Agreement as a result of
         the reduction in such Hedge Notional Amount and any such Swap
         Agreement Termination Event (x) that are due to the Swap Counterparty
         (including but not limited to Unpaid Amounts) shall have been paid to
         the Swap Counterparty by the Depositor and (y) that are payable by
         the Swap Counterparty, shall be payable for the account of the
         Depositor.

                                      19
<PAGE>

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

                                       SYNTHETIC FIXED-INCOME SECURITIES, INC.

                                       By:
                                       ----------------------------------------
                                                      Authorized Signatory

                                       U.S. BANK TRUST NATIONAL ASSOCIATION,
                                       as Trustee and Securities Intermediary

                                       By:
                                       ----------------------------------------
                                                      Responsible Officer

<PAGE>

                                                                     EXHIBIT A

        IDENTIFICATION OF THE UNDERLYING SECURITIES AS OF CLOSING DATE

<TABLE>
<CAPTION>
<S>                                            <C>
Underlying Securities Issuer:                   Goldman Sachs Capital I

Underlying Securities:                          (a) $40,000,000 (by aggregate liquidation amount) of 6.345%
                                                Capital Securities due February 15, 2034.

Underlying Securities Guarantor:                The Goldman Sachs Group, Inc.

Maturity Date/Final Distribution Date:          February 15, 2034.

Original Principal Amount Issued:               $2,750,000,000.

CUSIP No.:                                      38143VAA7.

Stated Interest Rate:                           6.345% per annum.

Interest Payment Dates:                         February 15 and August 15

Principal Amount of Underlying                  $40,000,000.
Securities Deposited Under Trust Agreement:
</TABLE>

The Underlying Securities will be held by the Trustee as securities
entitlements credited to an account of the Trustee or its agent at the
Depositary.

                                     A-1

<PAGE>

                                                                     EXHIBIT B

                 TERMS OF THE CERTIFICATES AS OF CLOSING DATE

<TABLE>
<CAPTION>
<S>                                                     <C>
Maximum Number of STRATS(SM)                            40,000
Certificates, Series 2005-3:

Aggregate Stated Amount of STRATS(SM) Certificates,     $40,000,000.
Series 2005-3:

Authorized Denomination:                                $1,000 and integral multiples thereof.

Rating Agency:                                          S&P.

Closing Date:                                           September 30, 2005.

Record Date:                                            With respect to any Distribution Date, the day immediately
                                                        preceding such Distribution Date.

Trustee's Fees:                                         The Trustee's fees shall be payable by the Trustor pursuant to
                                                        a separate fee agreement between the Trustee and the Trustor.

Initial Certificate Registrar:                          U.S. Bank Trust National Association

Corporate Trust Office:                                 U.S. Bank Trust National Association 100 Wall Street, Suite
                                                        1600 New York, New York 10005 Attention: Corporate Trust
                                                        Department, Regarding STRATS(SM) Trust For Goldman Sachs Capital
                                                        I Securities, Series 2005-3
</TABLE>

                                      B-1

<PAGE>

                                                                     EXHIBIT C

                              FORM OF CERTIFICATE

THIS CERTIFICATE REPRESENTS AN UNDIVIDED INTEREST IN THE TRUST AND DOES NOT
EVIDENCE AN OBLIGATION OF, OR AN INTEREST IN, AND IS NOT GUARANTEED BY THE
TRUSTOR OR THE TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS
CERTIFICATE NOR THE DEPOSITED ASSETS ARE INSURED OR GUARANTEED BY ANY
GOVERNMENTAL AGENCY OR ANY OTHER PERSON.

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITARY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE, OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

CERTIFICATE NUMBER:   1                  $40,000,000 Certificate Stated Amount
CUSIP:        86312BAB3                                    40,000 Certificates
CERTIFICATE INTEREST RATE:                              Variable Floating Rate

                     STRATS(SM) CERTIFICATES, SERIES 2005-3

evidencing an undivided interest in the Trust, as defined below, the assets of
which include $40,000,000 (by aggregate liquidation amount) of 6.345% Capital
Securities due February 15, 2034 issued by the Underlying Securities Issuer.

This Certificate does not represent an interest in or obligation of the
Trustor or any of its affiliates.

         THIS CERTIFIES THAT Cede & Co. is the registered owner of a
nonassessable, fully-paid, fractional undivided interest in STRATS(SM) Trust For
Goldman Sachs Capital I Securities, Series 2005-3 (the "Trust") formed by
SYNTHETIC FIXED-INCOME SECURITIES, INC., as Trustor (the "Trustor") evidenced
by Certificates in the number and the Stated Amount set forth above.

         The Trust was created pursuant to a Base Trust Agreement, dated as of
September 26, 2003 (as amended and supplemented, the "Agreement"), between the
Trustor and U.S. Bank Trust National Association, a national banking
association, not in its individual capacity but

                                      C-1
<PAGE>

solely as Trustee (the "Trustee"), as supplemented by the STRATS(SM)
Certificates Series Supplement 2005-3, dated as of September 30, 2005 (the
"Series Supplement" and, together with the Agreement, the "Trust Agreement"),
between the Trustor and the Trustee. This Certificate does not purport to
summarize the Trust Agreement and reference is hereby made to the Trust
Agreement for information with respect to the interests, rights, benefits,
obligations, proceeds and duties evidenced hereby and the rights, duties and
obligations of the Trustee with respect hereto. A copy of the Trust Agreement
may be obtained from the Trustee by written request sent to the Corporate
Trust Office. Capitalized terms used but not defined herein have the meanings
assigned to them in the Trust Agreement.

         This Certificate is one of the duly authorized Certificates
designated as "STRATS(SM) Certificates, Series 2005-3 (herein called the
"Certificate" or "Certificates"). This Certificate is issued under and is
subject to the terms, provisions and conditions of the Trust Agreement, to
which Trust Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound. The assets of the
Trust include the Underlying Securities, all proceeds of the Underlying
Securities and the Trust's rights under the Swap Agreement.

         Under the Trust Agreement, there shall be distributed on the dates
specified in the Trust Agreement (a "Distribution Date"), to the person in
whose name this Certificate is registered at the close of business on the
related Record Date, such Certificateholder's fractional undivided interest in
the amount of distributions of the Underlying Securities to be distributed to
Certificateholders on such Distribution Date and distributions to the Trust
under the Swap Agreement. The Underlying Securities will pay interest on
February 15 and August 15 of each year. The principal of the Underlying
Securities is scheduled to be paid on February 15, 2034. The Swap Agreement
provides for payments on the 15th calendar day of each month, except during a
Deferral Period, commencing on October 15, 2005.

         During any Deferral Period, interest on the Certificates will
continue to accrue at a specified rate and will be payable on the next
succeeding Underlying Securities Payment Date once (i) distributions on the
Underlying Securities have resumed and (ii) all amounts due and payable on the
Underlying Securities have been received by the Trust and any amounts owed to
the Swap Counterparty under the Swap Agreement have been paid to the Swap
Counterparty. Thereafter, and so long as the Swap Agreement is in effect,
interest on the Certificates will be payable semi-annually on each February 15
and August 15 (or the next succeeding business day), until the Certificates
have been retired.

         The distributions in respect of this Certificate are payable in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts as set forth in the
Series Trust Agreement.

         The Underlying Securities held by the Trust are subject to the rights
of the Swap Counterparty, as provided for in the Series Supplement and the
Swap Agreement, and each Certificateholder, by accepting its Certificate,
acknowledges such rights in accordance with the terms of the Series Supplement
and the Swap Agreement.

         It is the intent of the Trustor and the Certificateholders that the
Trust will be classified as a grantor trust under subpart E, Part I of
subchapter J of the Internal Revenue Code of 1986, as

                                     C-2

<PAGE>

amended. Except as otherwise required by appropriate taxing authorities, the
Trustor and the Trustee, by executing the Trust Agreement, and each
Certificateholder, by acceptance of a Certificate, agrees to treat, and to
take no action inconsistent with the treatment of, the Certificates for such
tax purposes as interests in a grantor trust and the provisions of the Trust
Agreement shall be interpreted to further this intention of the parties.

         By acceptance of a Certificate, each Certificateholder (1) elects to
integrate the Underlying Securities and the Swap Agreement for United States
federal income tax purposes, (2) authorizes and directs the trustee (or the
trustee's agent) to retain, as part of the Certificateholder's books and
records, information that (a) describes the Underlying Securities and the Swap
Agreement, (b) identifies the two positions as integrated for federal income
tax purposes and (c) describes the features of the resulting "synthetic" debt
instrument and (3) agrees to retain copies of such information as provided to
the Certificateholder by the Trust.

         Each Certificateholder, by its acceptance of a Certificate, covenants
and agrees that such Certificateholder shall not, prior to the date which is
one year and one day after the termination of the Trust Agreement, acquiesce,
petition or otherwise invoke or cause the Trustor to invoke the process of any
court or governmental authority for the purpose of commencing or sustaining a
case against the Trustor under any federal or state bankruptcy, insolvency,
reorganization or similar law or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Trustor or
any substantial part of its property, or ordering the winding up or
liquidation of the affairs of the Trustor.

         Certificates may not be acquired by or for the account of any
employee benefit plan, trust or account, including an individual retirement
account, that is subject to the requirements of Title I of the Employee
Retirement Income Security Act of 1974, as amended, or that is described in
Section 4975(e)(1) of the Code, or by or for the account of any entity whose
underlying assets include any assets subject to these laws by reason of
investment in that entity by such plans, trusts or accounts. By accepting and
holding this Certificate, the holder of this Certificate will be deemed to
have represented and warranted that it is not a plan or entity described
above, and that its acquisition and holding of this Certificate are in
compliance with the foregoing restrictions.

         The Trust Agreement permits the amendment thereof, in certain
circumstances, without the consent of the Holders of any of the Certificates.

         Unless the certificate of authentication hereon shall have been
executed by an authorized officer of the Trustee by manual signature, this
Certificate shall not entitle the Holder hereof to any benefit under the Trust
Agreement or be valid for any purpose.

         A copy of the Trust Agreement is available upon request and all of
its terms and conditions are hereby incorporated by reference and made a part
hereof.

         THIS CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS,
AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.

                                     C-3

<PAGE>

IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed as of the date set forth below.

                                 STRATS(SM) TRUST FOR GOLDMAN SACHS
                                 CAPITAL I SECURITIES, SERIES 2005-3

                                 By:  U.S. BANK TRUST NATIONAL
                                 ASSOCIATION, not in its individual capacity
                                 but solely as Trustee

                                 By:
                                      -----------------------------------------
                                       Authorized Signatory

Dated:  September 30, 2005

                    TRUSTEE'S CERTIFICATE OF AUTHENTICATION

This is one of the STRATS(SM) Certificates, Series 2005-3, described in the
Trust Agreement referred to herein.

U.S. BANK TRUST NATIONAL ASSOCIATION, not in its individual capacity but
solely as Trustee

By:
     -------------------------------------------------
       Authorized Signatory

                                     C-4

<PAGE>

                                  ASSIGNMENT

FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto

PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE

_______________________________________________________________________________

(Please print or type name and address, including postal zip code, of
assignee) __________________________ the within Certificate, and all rights
thereunder, hereby irrevocably constituting and appointing __________________
Attorney to transfer said Certificate on the books of the Certificate
Register, with full power of substitution in the premises.

Dated:

                                  ____________________________________________*

*NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Signatures must be guaranteed
by an "eligible guarantor institution" meeting the requirements of the
Certificate Registrar, which requirements include membership or participation
in the Security Transfer Agent Medallion Program ("STAMP") or such other
"signature guarantee program" as may be determined by the Certificate
Registrar in addition to, or in substitution for, STAMP, all in accordance
with the Securities Exchange Act of 1934, as amended.

                                     C-5

<PAGE>

                                                                     EXHIBIT D

                                                                   Exhibit D-1

(Multicurrency - Cross Border)

                                    ISDA(R)
                 International Swap Dealers Association, Inc.

                               MASTER AGREEMENT

                        dated as of September 30, 2005

WACHOVIA BANK, NATIONAL         and STRATS(SM) TRUST FOR GOLMAN SACHS CAPITAL I
ASSOCIATION                         SECURITIES, SERIES 2005-3

have entered and/or anticipate entering into one of more transactions (each a
"Transaction") that are or will be governed by this Master Agreement, which
includes the schedule (the "Schedule"), and the documents and other confirming
evidence (each a "Confirmation") exchanged between the parties confirming
those Transactions.

Accordingly, the parties agree as follows: --

1.       Interpretation

(a)      Definitions. The terms defined in Section 14 and in the Schedule will
have the meanings therein specified for the purpose of this Master Agreement.

(b)      Inconsistency. In the event of any inconsistency between the
provisions of the Schedule and the other provisions of this Master Agreement,
the Schedule will prevail. In the event of any inconsistency between the
provisions of any Confirmation and this Master Agreement (including the
Schedule), such Confirmation will prevail for the purpose of the relevant
Transaction.

(c)      Single Agreement. All Transactions are entered into in reliance on
the fact that this Master Agreement and all Confirmations form a single
agreement between the parties (collectively referred to as this "Agreement"),
and the parties would not otherwise enter into any Transactions.

2.       Obligations

(a)      General Conditions.

         (i) Each party will make each payment or delivery specified in each
         Confirmation to be made by it, subject to the other provisions of
         this Agreement.

         (ii) Payments under this Agreement will be made on the due date for
         value on that date in the place of the account specified in the
         relevant Confirmation or otherwise pursuant to this Agreement, in
         freely transferable funds and in the manner customary for payments in
         the required currency. Where settlement is by delivery (that is,
         other than by payment), such delivery will be made for receipt on the
         due date in the manner customary for the relevant obligation unless
         otherwise specified in the relevant Confirmation or elsewhere in this
         Agreement.

         (iii) Each obligation of each party under Section 2(a)(i) is subject
         to (1) the condition precedent that no Event of Default or Potential
         Event of Default with respect to the other party has occurred and is

                                    D-1-1
<PAGE>

         continuing, (2) the condition precedent that no Early Termination
         Date in respect of the relevant Transaction has occurred or been
         effectively designated and (3) each other applicable condition
         precedent specified in this Agreement.

(b)      Change of Account. Either party may change its account for receiving
a payment or delivery by giving notice to the other party at least five Local
Business Days prior to the scheduled date for the payment or delivery to which
such change applies unless such other party gives timely notice of a
reasonable objection to such change.

(c)      Netting. If on any date amounts would otherwise be payable: --

         (i) in the same currency; and

         (ii) in respect of the same Transaction,

by each party to the other. then, on such date, each party's obligation to
make payment of any such amount will be automatically satisfied and discharged
and, if the aggregate amount that would otherwise have been payable by one
party exceeds the aggregate amount that would otherwise have been payable by
the other party, replaced by an obligation upon the party by whom the larger
aggregate amount would have been payable to pay to the other party the excess
of the larger aggregate amount over the smaller aggregate amount.

The parties may elect in respect of two or more Transactions that a net amount
will be determined in respect of all amounts payable on the same date in the
same currency in respect of such Transactions, regardless of whether such
amounts are payable in respect of the same Transaction. The election may be
made in the Schedule or a Confirmation by specifying that subparagraph (ii)
above will not apply to the Transactions identified as being subject to the
election, together with the starting date (in which case subparagraph (ii)
above will not, or will cease to, apply to such Transactions from such date).
This election may be made separately for different groups of Transactions and
will apply separately to each pairing of Offices through which the parties
make and receive payments or deliveries.

(d)      Deduction or Withholding for Tax.

         (i) Gross-Up. All payments under this Agreement will be made without
         any deduction or withholding for or on account of any Tax unless such
         deduction or withholding is required by any applicable law, as
         modified by the practice of any relevant governmental revenue
         authority, then in effect. If a party is so required to deduct or
         withhold, then that party ("X") will: --

                  (1) promptly notify the other party ("Y") of such
                  requirement;

                  (2) pay to the relevant authorities the full amount required
                  to be deducted or withheld (including the full amount
                  required to be deducted or withheld from any additional
                  amount paid by X to Y under this Section 2(d)) promptly upon
                  the earlier of determining that such deduction or
                  withholding is required or receiving notice that such amount
                  has been assessed against Y;

                  (3) promptly forward to Y an official receipt (or a
                  certified copy), or other documentation reasonably
                  acceptable to Y, evidencing such payment to such
                  authorities; and

                  (4) if such Tax is an Indemnifiable Tax, pay to Y, in
                  addition to the payment to which Y is otherwise entitled
                  under this Agreement, such additional amount as is necessary
                  to ensure that the net amount actually received by Y (free
                  and clear of Indemnifiable Taxes. whether assessed against X
                  or Y) will equal ft full amount Y would have received had no
                  such deduction or withholding been required. However, X will
                  not be required to pay any additional amount to Y to the
                  extent that it would not be required to be paid but for: --

                           (A) the failure by Y to comply with or perform any
                           agreement contained in Section 4(a)(i), 4(a)(iii)
                           or 4(d); or

                           (B) the failure of a representation made by Y
                           pursuant to Section 3(f) to be accurate and true
                           unless such failure would not have occurred but for
                           (I) any action taken by a taxing authority, or
                           brought in a court of competent jurisdiction, on or
                           after the date on which a

                                    D-1-2
<PAGE>

                           Transaction is entered into (regardless of whether
                           such action is taken or brought with respect to a
                           party to this Agreement) or (II) a Change in Tax
                           Law.

         (ii)     Liability. If: --

                  (1) X is required by any applicable law, as modified by the
                  practice of any relevant governmental revenue authority, to
                  make any deduction or withholding in respect of which X
                  would not be required to pay an additional amount to Y under
                  Section 2(d)(i)(4);

                  (2) X does not so deduct or withhold; and

                  (3) a liability resulting from such Tax is assessed directly
                  against X,

         then, except to the extent Y has satisfied or then satisfies the
         liability resulting from such Tax, Y will promptly pay to X the
         amount of such liability (including any related liability for
         interest, but including any related liability for penalties only if Y
         has failed to comply with or perform any agreement contained in
         Section 4(a)(i), 4(a)(iii) or 4(d)).

(e)      Default Interest; Other Amounts. Prior to the occurrence or effective
designation of an Early Termination Date in respect of the relevant
Transaction, a party that defaults in the performance of any payment
obligation will, to the extent permitted by law and subject to Section 6(c),
be required to pay interest (before as well as after judgment) on the overdue
amount to the other party on demand in the same currency as such overdue
amount, for the period from (and including) the original due date for payment
to (but excluding) the date of actual payment, at the Default Rate. Such
interest will be calculated on the basis of daily compounding and the actual
number of days elapsed. If, prior to the occurrence or effective designation
of an Early Termination Date in respect of the relevant Transaction, a party
defaults in the performance of any obligation required to be settled by
delivery, it will compensate the other party on demand if and to the extent
provided for in the relevant Confirmation or elsewhere in this Agreement.

3.       Representations

Each party represents to the other party (which representations will be deemed
to be repeated by each party on each date on which a Transaction is entered
into and, in the case of the representations in Section 3(f), at all times
until the termination of this Agreement) that: --

(a)      Basic Representations.

         (i) Status. It is duly organised and validly existing under the laws
         of the jurisdiction of its organisation or incorporation and, if
         relevant under such laws, in good standing;

         (ii) Powers. It has the power to execute this Agreement and any other
         documentation relating to this Agreement to which it is a party, to
         deliver this Agreement and any other documentation relating to this
         Agreement that it is required by this Agreement to deliver and to
         perform its obligations under this Agreement and any obligations it
         has under any Credit Support Document to which it is a party and has
         taken all necessary action to authorise such execution, delivery and
         performance;

         (iii) No Violation or Conflict. Such execution, delivery and
         performance do not violate or conflict with any law applicable to it,
         any provision of its constitutional documents, any order or judgment
         of any court or other agency of government applicable to it or any of
         its assets or any contractual restriction binding on or affecting it
         or any of its assets;

         (iv) Consents. All governmental and other consents that are required
         to have been obtained by it with respect to this Agreement or any
         Credit Support Document to which it is a party have been obtained and
         are in full force and effect and all conditions of any such consents
         have been complied with; and

                                    D-1-3
<PAGE>

         (v) Obligations Binding. Its obligations under this Agreement and any
         Credit Support Document to which it is a party constitute its legal,
         valid and binding obligations, enforceable in accordance with their
         respective terms (subject to applicable bankruptcy, reorganisation,
         insolvency, moratorium or similar laws affecting creditors' rights
         generally and subject, as to enforceability, to equitable principles
         of general application (regardless of whether enforcement is sought
         in a proceeding in equity or at law)).

(b)      Absence of Certain Events. No Event of Default or Potential Event of
Default or, to its knowledge, Termination Event with respect to it has
occurred and is continuing and no such event or circumstance would occur as a
result of its entering into or performing its obligations under this Agreement
or any Credit Support Document to which it is a party.

(c)      Absence of Litigation. There is not pending or, to its knowledge,
threatened against it or any of its Affiliates any action, suit or proceeding
at law or in equity or before any court, tribunal, governmental body, agency
or official or any arbitrator that is likely to affect the legality, validity
or enforceability against it of this Agreement or any Credit Support Document
to which it is a party or its ability to perform its obligations under this
Agreement or such Credit Support Document.

(d)      Accuracy of Specified Information. All applicable information that is
furnished in writing by or on behalf of it to the other party and is
identified for the purpose of this Section 3(d) in the Schedule is, as of the
date of the information, true, accurate and complete in every material
respect.

(e)      Payer Tax Representation. Each representation specified in the
Schedule as being made by it for the purpose of this Section 3(e) is accurate
and true.

(f)      Payee Tax Representations. Each representation specified in the
Schedule as being made by it for the purpose of this Section 3(f) is accurate
and true.

4.       Agreements

Each party agrees with the other that, so long as either party has or may have
any obligation under this Agreement or under any Credit Support Document to
which it is a party: --

(a)      Furnish Specified Information. It will deliver to the other party or,
in certain cases under subparagraph (iii) below, to such government or taxing
authority as the other party reasonably directs: --

         (i) any forms, documents or certificates relating to taxation
         specified in the Schedule or any Confirmation;

         (ii) any other documents specified in the Schedule of any
         Confirmation; and

         (iii) upon reasonable demand by such other party, any form or
         document that may be required or reasonably requested in writing in
         order to allow such other party or its Credit Support Provider to
         make a payment under this Agreement or any applicable Credit Support
         Document without any deduction or withholding for or on account of
         any Tax or with such deduction or withholding at a reduced rate (so
         long as the completion, execution or submission of such form or
         document would not materially prejudice the legal or commercial
         position of the party in receipt of such demand), with any such form
         or document to be accurate and completed in a manner reasonably
         satisfactory to such other party and to be executed and to be
         delivered with any reasonably required certification,

in each case by the date specified in the Schedule or such Confirmation or, if
none is specified, as soon as reasonably practicable.

(b)      Maintain Authorisations. It will use all reasonable efforts to
maintain in full force and effect all consents of any governmental or other
authority that are required to be obtained by it with respect to this
Agreement or any Credit Support Document to which it is a party and will use
all reasonable efforts to obtain any that may become necessary in the future.

(c)      Comply with Laws. It will comply in all material respects with all
applicable laws and orders to which it may be subject if failure so to comply
would materially impair its ability to perform its obligations under this
Agreement or any Credit Support Document to which it is a party.

(d)      Tax Agreement. It will give notice of any failure of a representation
made by it under Section 3(f) to be accurate and true promptly upon learning
of such failure.

                                    D-1-4
<PAGE>

(e)      Payment of Stamp Tax. Subject to Section 11, it will pay any Stamp
Tax levied or imposed upon it or in respect of its execution or performance of
this Agreement by a jurisdiction in which it is incorporated, organised,
managed and controlled. or considered to have its seat, or in which a branch
or office through which it is acting for the purpose of this Agreement is
located ("Stamp Tax Jurisdiction") and will indemnify the other party against
any Stamp Tax levied or imposed upon the other party or in respect of the
other party's execution or performance of this Agreement by any such Stamp Tax
Jurisdiction which is not also a Stamp Tax Jurisdiction with respect to the
other party.

5.       Events or Default and Termination Events

(a)      Events of Default. The occurrence at any time with respect to a party
or, if applicable, any Credit Support Provider of such party or any Specified
Entity of such party of any of the following events constitutes an event of
default (an "Event of Default") with respect to such party: --

         (i) Failure to Pay or Deliver. Failure by the party to make, when
         due, any payment under this Agreement or delivery under Section
         2(a)(i) or 2(e) required to be made by it if such failure is not
         remedied on or before the third Local Business Day after notice of
         such failure is given to the party;

         (ii) Breach of Agreement. Failure by the party to comply with or
         perform any agreement or obligation (other than an obligation to make
         any payment under this Agreement or delivery under Section 2(a)(i) or
         2(e) or to give notice of a Termination Event or any agreement or
         obligation under Section 4(a)(i), 4(a)(iii) or 4(d)) to be complied
         with or performed by the party in accordance with this Agreement if
         such failure is not remedied on or before the thirtieth day after
         notice of such failure is given to the party;

         (iii) Credit Support Default.

                  (1) Failure by the party or any Credit Support Provider of
                  such party to comply with or perform any agreement or
                  obligation to be complied with or performed by it in
                  accordance with any Credit Support Document if such failure
                  is continuing after any applicable grace period has elapsed;

                  (2) the expiration or termination of such Credit Support
                  Document or the failing or ceasing of such Credit Support
                  Document to be in full force and effect for the purpose of
                  this Agreement (in either case other than in accordance with
                  its terms) prior to the satisfaction of all obligations of
                  such party under each Transaction to which such Credit
                  Support Document relates without the written consent of the
                  other party; or

                  (3) the party or such Credit Support Provider disaffirms,
                  disclaims, repudiates or rejects, in whole or in part, or
                  challenges the validity of, such Credit Support Document;

         (iv) Misrepresentation. A representation (other than a representation
         under Section 3(e) or (f)) made or repeated or deemed to have been
         made or repeated by the party or any Credit Support Provider of such
         party in this Agreement or any Credit Support Document proves to have
         been incorrect or misleading in any material respect when made or
         repeated or deemed to have been made or repeated;

         (v) Default under Specified Transaction. The party, any Credit
         Support Provider of such party or any applicable Specified Entity of
         such party (1) defaults under a Specified Transaction and, after
         giving effect to any applicable notice requirement or grace period,
         there occurs a liquidation of, an acceleration of obligations under,
         or an early termination of, that Specified Transaction, (2) defaults,
         after giving effect to any applicable notice requirement or grace
         period, in making any payment or delivery due on the last payment,
         delivery or exchange date of, or any payment on early termination of,
         a Specified Transaction (or such default continues for at least three
         Local Business Days if there is no applicable notice requirement or
         grace period) or (3) disaffirms, disclaims, repudiates or rejects, in
         whole or in part, a Specified Transaction (or such action is taken by
         any person or entity appointed or empowered to operate it or act on
         its behalf);

         (vi) Cross Default. If "Cross Default" is specified in the Schedule
         as applying to the party, the occurrence or existence of (1) a
         default, event of default or other similar condition or event
         (however

                                    D-1-5
<PAGE>

         described) in respect of such party, any Credit Support Provider of
         such party or any applicable Specified Entity of such party under one
         or more agreements or instruments relating to Specified Indebtedness
         of any of them (individually or collectively) in an aggregate amount
         of not less than the applicable Threshold Amount (as specified in the
         Schedule) which has resulted in such Specified Indebtedness becoming,
         or becoming capable at such time of being declared, due and payable
         under such agreements or instruments, before it would otherwise have
         been due and payable or (2) a default by such party, such Credit
         Support Provider or such Specified Entity (individually or
         collectively) in making one or more payments on the due date thereof
         in an aggregate amount of not less than the applicable Threshold
         Amount under such agreements or instruments (after giving effect to
         any applicable notice requirement or grace period);

         (vii) Bankruptcy. The party, any Credit Support Provider of such
         party or any applicable Specified Entity of such party:-

                  (1) is dissolved (other than pursuant to a consolidation,
                  amalgamation or merger); (2) becomes insolvent or is unable
                  to pay its debts or fails or admits in writing its inability
                  generally to pay its debts as they become due; (3) makes a
                  general assignment, arrangement or composition with or for
                  the benefit of its creditors; (4) institutes or has
                  instituted against it a proceeding seeking a judgment of
                  insolvency or bankruptcy or any other relief under any
                  bankruptcy or insolvency law or other similar law affecting
                  creditors' rights, or a petition is presented for its
                  winding-up or liquidation, and, in the case of any such
                  proceeding or petition instituted or presented against it,
                  such proceeding or petition (A) results in a judgment of
                  insolvency or bankruptcy or the entry of an order for relief
                  or the making of an order for its winding-up or liquidation
                  or (B) is not dismissed, discharged, stayed or restrained in
                  each case within 30 days of the institution or presentation
                  thereof, (5) has a resolution passed for its winding-up,
                  official management or liquidation (other than pursuant to a
                  consolidation, amalgamation or merger); (6) seeks or becomes
                  subject to the appointment of an administrator, provisional
                  liquidator, conservator, receiver, trustee, custodian or
                  other similar official for it or for all or substantially
                  all its assets; (7) has a secured party take possession of
                  all or substantially all its assets or has a distress,
                  execution, attachment, sequestration or other legal process
                  levied, enforced or sued on or against all or substantially
                  all its assets and such secured party maintains possession,
                  or any such process is not dismissed, discharged, stayed or
                  restrained, in each case within 30 days thereafter; (8)
                  causes or is subject to any event with respect to it which,
                  under the applicable laws of any jurisdiction, has an
                  analogous effect to any of the events specified in clauses
                  (1) to (7) (inclusive); or (9) takes any action in
                  furtherance of, or indicating its consent to, approval of,
                  or acquiescence in, any of the foregoing acts; or

         (viii) Merger Without Assumption. The party or any Credit Support
         Provider of such party consolidates or amalgamates with, or merges
         with or into, or transfers all or substantially all its assets to,
         another entity and, at the time of such consolidation, amalgamation,
         merger or transfer: -

                  (1) the resulting, surviving or transferee entity fails to
                  assume all the obligations of such party or such Credit
                  Support Provider under this Agreement or any Credit Support
                  Document to which it or its predecessor was a party by
                  operation of law or pursuant to an agreement reasonably
                  satisfactory to the other party to this Agreement; or

                  (2) the benefits of any Credit Support Document fail to
                  extend (without the consent of the other party) to the
                  performance by such resulting, surviving or transferee
                  entity of its obligations under this Agreement.

(b)      Termination Events. The occurrence at any time with respect to a
party or, if applicable, any Credit Support Provider of such party or any
Specified Entity of such party of any event specified below constitutes an
Illegality if the event is specified in (i) below, a Tax Event if the event is
specified in (ii) below or a Tax Event Upon Merger if the event is specified
in (iii) below, and, if specified to be applicable, a Credit Event.

                                    D-1-6
<PAGE>

Upon Merger if the event is specified pursuant to (iv) below or an Additional
Termination Event if the event is specified pursuant to (v) below:--

         (i) Illegality. Due to the adoption of, or any change in, any
         applicable law after the date on which a Transaction is entered into,
         or due to the promulgation of, or any change in, the interpretation
         by any court, tribunal or regulatory authority with competent
         jurisdiction of any applicable law after such date. it becomes
         unlawful (other than as a result of a breach by the party of Section
         4(b)) for such party (which will be the Affected Party):--

                  (1) to perform any absolute or contingent obligation to make
                  a payment or delivery or to receive a payment or delivery in
                  respect of such Transaction or to comply with any other
                  material provision of this Agreement relating to such
                  Transaction; or

                  (2) to perform, or for any Credit Support Provider of such
                  party to perform, any contingent or other obligation which
                  the party (or such Credit Support Provider) has under any
                  Credit Support Document relating to such Transaction;

         (ii) Tax Event. Due to (x) any action taken by a taxing authority, or
         brought in a court of competent jurisdiction, on or after the date on
         which a Transaction is entered into (regardless of whether such
         action is taken or brought with respect to a party to this Agreement)
         or (y) a Change in Tax Law, the party (which will be the Affected
         Party) will, or there is a substantial likelihood that it will, on
         the next succeeding Scheduled Payment Date (1) be required to pay to
         the other party an additional amount in respect of an Indemnifiable
         Tax under Section 2(d)(i)(4) (except in respect of interest under
         Section 2(e), 6(d)(ii) or 6(e)) or (2) receive a payment from which
         an amount is required to be deducted or withheld for or on account of
         a Tax (except in respect of interest under Section 2(e), 6(d)(ii) or
         6(e)) and no additional amount is required to be paid in respect of
         such Tax under Section 2(d)(i)(4) (other than by reason of Section
         2(d)(i)(4)(A) or (B));

         (iii) Tax Event Upon Merger. The party (the "Burdened Party") on the
         next succeeding Scheduled Payment Date will either (1) be required to
         pay an additional amount in respect of an Indemnifiable Tax under
         Section 2(d)(i)(4) (except in respect of interest under Section 2(e),
         6(d)(ii) or 6(e)) or (2) receive a payment from which an amount has
         been deducted or withheld for or on account of any Indemnifiable Tax
         in respect of which the other party is not required to pay an
         additional amount (other than by reason of Section 2(d)(i)(4)(A) or
         (B)), in either case as a result of a party consolidating or
         amalgamating with, or merging with or into, or transferring all or
         substantially all its assets to, another entity (which will be the
         Affected Party) where such action does not constitute an event
         described in Section 5(a)(viii);

         (iv) Credit Event Upon Merger. If "Credit Event Upon Merger" is
         specified in the Schedule as applying to the party, such party ("X"),
         any Credit Support Provider of X or any applicable Specified Entity
         of X consolidates or amalgamates with, or merges with or into, or
         transfers all or substantially all its assets to, another entity and
         such action does not constitute an event described in Section
         5(a)(viii) but the creditworthiness of the resulting, surviving or
         transferee entity is materially weaker than that of X, such Credit
         Support Provider or such Specified Entity, as the case may be,
         immediately prior to such action (and, in such event, X or its
         successor or transferee, as appropriate, will be the Affected Party);
         or

         (v) Additional Termination Event. If any "Additional Termination
         Event" is specified in the Schedule or any Confirmation as applying.
         the occurrence of such event (and, in such event. the Affected Party
         or Affected Parties shall be as specified for such Additional
         Termination Event in the Schedule or such Confirmation).

(j)    Event of Default and Illegality. If an event or circumstance which
would otherwise constitute or give rise to an Event of Default also
constitutes an Illegality, it will be treated as an Illegality and will not
constitute an Event of Default.

                                    D-1-7
<PAGE>

6.       Early Termination

(a)      Right to Terminate Following Event of Default. If at any time an
Event of Default with respect to a party (the "Defaulting Party") has occurred
and is then continuing, the other party (the "Non-defaulting Party") may, by
not more than 20 days notice to the Defaulting Party specifying the relevant
Event of Default, designate a day not earlier than the day such notice is
effective as an Early Termination Date in respect of all outstanding
Transactions. If, however, "Automatic Early Termination" is specified in the
Schedule as applying to a party, then an Early Termination Date in respect of
all outstanding Transactions will occur immediately upon the occurrence with
respect to such party of an Event of Default specified in Section
5(a)(vii)(l), (3), (5), (6) or, to the extent analogous thereto, (8), and as
of the time immediately preceding the institution of the relevant proceeding
or the presentation of the relevant petition upon the occurrence with respect
to such party of an Event of Default specified in Section 5(a)(vii)(4) or, to
the extent analogous thereto, (8).

(b)      Right to Terminate Following Termination Event.

         (i) Notice. If a Termination Event occurs, an Affected Party will,
         promptly upon becoming aware of it, notify the other party,
         specifying the nature of that Termination Event and each Affected
         Transaction and will also give such other information about that
         Termination Event as the other party may reasonably require.

         (ii) Transfer to Avoid Termination Event. If either an Illegality
         under Section 5(b)(i)(1) or a Tax Event occurs and there is only one
         Affected Party, or if a Tax Event Upon Merger occurs and the Burdened
         Party is the Affected Party, the Affected Party will, as a condition
         to its right to designate an Early Termination Date under Section
         6(b)(iv), use all reasonable efforts (which will not require such
         party to incur a loss, excluding immaterial, incidental expenses) to
         transfer within 20 days after it gives notice under Section 6(b)(i)
         all its rights and obligations under this Agreement in respect of the
         Affected Transactions to another of its Offices or Affiliates so that
         such Termination Event ceases to exist.

         If the Affected Party is not able to make such a transfer it will
         give notice to the other party to that effect within such 20 day
         period, whereupon the other party may effect such a transfer within
         30 days after the notice is given under Section 6(b)(i).

         Any such transfer by a party under this Section 6(b)(ii) will be
         subject to and conditional upon the prior written consent of the
         other party, which consent will not be withheld if such other party's
         policies in effect at such time would permit it to enter into
         transactions with the transferee on the terms proposed.

         (iii) Two Affected Parties. If an Illegality under Section 5(b)(i)(1)
         or a Tax Event occurs and there are two Affected Parties, each party
         will use all reasonable efforts to reach agreement within 30 days
         after notice thereof is given under Section 6(b)(i) on action to
         avoid that Termination Event.

         (iv) Right to Terminate. If:--

                  (1) a transfer under Section 6(b)(ii) or an agreement under
                  Section 6(b)(iii), as the case may be, has not been effected
                  with respect to all Affected Transactions within 30 days
                  after an Affected Party gives notice under Section 6(b)(i);
                  or

                  (2) an Illegality under Section 5(b)(i)(2), a Credit Event
                  Upon Merger or an Additional Termination Event occurs, or a
                  Tax Event Upon Merger occurs and the Burdened Party is not
                  the Affected Party,

         either party in the case of an Illegality, the Burdened Party in the
         case of a Tax Event Upon Merger, any Affected Party in the case of a
         Tax Event or an Additional Termination Event if there is more than
         one Affected Party, or the party which is not the Affected Party in
         the case of a Credit Event Upon Merger or an Additional Termination
         Event if there is only one Affected Party may, by not more than 20
         days notice to the other party and provided that the relevant
         Termination Event is then

                                    D-1-8
<PAGE>

         continuing, designate a day not earlier than the day such notice is
         effective as an Early Termination Date in respect of all Affected
         Transactions.

(c)      Effect of Designation.

         (i) If notice designating an Early Termination Date is given under
         Section 6(a) or (b), the Early Termination Date will occur on the
         date so designated, whether or not the relevant Event of Default or
         Termination Event is then continuing.

         (ii) Upon the occurrence or effective designation of an Early
         Termination Date, no further payments or deliveries under Section
         2(a)(i) or 2(e) in respect of the Terminated Transactions will be
         required to be made, but without prejudice to the other provisions of
         this Agreement. The amount, if any, payable in respect of an Early
         Termination Date shall be determined pursuant to Section 6(e).

(d)      Calculations.

         (i) Statement. On or as soon as reasonably practicable following the
         occurrence of an Early Termination Date, each party will make the
         calculations on its part, if any, contemplated by Section 6(e) and
         will provide to the other party a statement (1) showing, in
         reasonable detail, such calculations (including all relevant
         quotations and specifying any amount payable under Section 6(e)) and
         (2) giving details of the relevant account to which any amount
         payable to it is to be paid. In the absence of written confirmation
         from the source of a quotation obtained in determining a Market
         Quotation, the records of the party obtaining such quotation will be
         conclusive evidence of the existence and accuracy of such quotation.

         (ii) Payment Date. An amount calculated as being due in respect of
         any Early Termination Date under Section 6(e) will be payable on the
         day that notice of the amount payable is effective (in the case of an
         Early Termination Date which is designated or occurs as a result of
         an Event of Default) and on the day which is two Local Business Days
         after the day on which notice of the amount payable is effective (in
         the case of an Early Termination Date which is designated as a result
         of a Termination Event). Such amount will be paid together with (to
         the extent permitted under applicable law) interest thereon (before
         as well as after judgment) in the Termination Currency, from (and
         including) the relevant Early Termination Date to (but excluding) the
         date such amount is paid, at the Applicable Rate. Such interest will
         be calculated on the basis of daily compounding and the actual number
         of days elapsed.

(e)      Payments on Early Termination. If an Early Termination Date occurs,
the following provisions shall apply based on the parties' election in the
Schedule of a payment measure, either "Market Quotation" or "Loss", and a
payment method, either the "First Method" or the "Second Method". If the
parties fail to designate a payment measure or payment method in the Schedule,
it will be deemed that "Market Quotation" or the "Second Method", as the case
may be, shall apply. The amount, if any, payable in respect of an Early
Termination Date and determined pursuant to this Section will be subject to
any Set-off.

         (i) Events of Default. If the Early Termination Date results from an
         Event of Default:--

                  (1) First Method and Market Quotation. If the First Method
                  and Market Quotation apply, the Defaulting Party will pay to
                  the Non-defaulting Party the excess, if a positive number,
                  of (A) the sum of the Settlement Amount (determined by the
                  Non-defaulting Party) in respect of the Terminated
                  Transactions and the Termination Currency Equivalent of the
                  Unpaid Amounts owing to the Non-defaulting Party over (B)
                  the Termination Currency Equivalent of the Unpaid Amounts
                  owing to the Defaulting Party.

                  (2) First Method and Loss. If the First Method and Loss
                  apply, the Defaulting Party will pay to the Non-defaulting
                  Party, if a positive number, the Non-defaulting Party's Loss
                  in respect of this Agreement.

                  (3) Second Method and Market Quotation. If the Second Method
                  and Market Quotation apply, an amount will be payable equal
                  to (A) the sum of the Settlement Amount (determined by the

                                    D-1-9
<PAGE>

                  Non-defaulting Party) in respect of the Terminated
                  Transactions and the Termination Currency Equivalent of the
                  Unpaid Amounts owing to the Non-defaulting Party less (B)
                  the Termination Currency Equivalent of the Unpaid Amounts
                  owing to the Defaulting Party. If that amount is a positive
                  number, the Defaulting Party will pay it to the
                  Non-defaulting Party; if it is a negative number, the
                  Non-defaulting Party will pay the absolute value of that
                  amount to the Defaulting Party.

                  (4) Second Method and Loss. If the Second Method and Loss
                  apply, an amount will be payable equal to the Non-defaulting
                  Party's Loss in respect of this Agreement. If that amount is
                  a positive number, the Defaulting Party will pay it to the
                  Non-defaulting Party; if it is a negative number, the
                  Non-defaulting Party will pay the absolute value of that
                  amount to the Defaulting Party.

         (ii) Termination Events. If the Early Termination Date results from a
         Termination Event:--

                  (1) One Affected Party. If there is one Affected Party, the
                  amount payable will be determined in accordance with Section
                  6(e)(i)(3), if Market Quotation applies, or Section
                  6(e)(i)(4), if Loss applies, except that, in either case,
                  references to the Defaulting Party and to the Non-defaulting
                  Party will be deemed to be references to the Affected Party
                  and the party which is not the Affected Party, respectively,
                  and, if Loss applies and fewer than all the Transactions are
                  being terminated, Loss shall be calculated in respect of all
                  Terminated Transactions.

                  (2) Two Affected Parties. If there are two Affected
                  Parties:--

                           (A) if Market Quotation applies, each party will
                           determine a Settlement Amount in respect of the
                           Terminated Transactions, and an amount will be
                           payable equal to (I) the sum of (a) one-half of the
                           difference between the Settlement Amount of the
                           party with the higher Settlement Amount ("X") and
                           the Settlement Amount of the party with the lower
                           Settlement Amount ("Y") and (b) the Termination
                           Currency Equivalent of the Unpaid Amounts owing to
                           X less (II) the Termination Currency Equivalent of
                           the Unpaid Amounts owing to Y; and

                           (B) if Loss applies, each party will determine its
                           Loss in respect of this Agreement (or, if fewer
                           than all the Transactions are being terminated, in
                           respect of all Terminated Transactions) and an
                           amount will be payable equal to one-half of the
                           difference between the Loss of the party with the
                           higher Loss ("X") and the Loss of the party with
                           the lower Loss ("Y").

                  If the amount payable is a positive number, Y will pay it to
                  X; if it is a negative number, X will pay the absolute value
                  of that amount to Y.

         (iii) Adjustment for Bankruptcy. In circumstances where an Early
         Termination Date occurs because "Automatic Early Termination" applies
         in respect of a party, the amount determined under this Section 6(e)
         will be subject to such adjustments as are appropriate and permitted
         by law to reflect any payments or deliveries made by one party to the
         other under this Agreement (and retained by such other party) during
         the period from the relevant Early Termination Date to the date for
         payment determined under Section 6(d)(ii).

         (iv) Pre-Estimate. The parties agree that if Market Quotation applies
         an amount recoverable under this Section 6(e) is a reasonable
         pre-estimate of loss and not a penalty. Such amount is payable for
         the loss of bargain and the loss of protection against future risks
         and except as otherwise provided in this Agreement neither party will
         be entitled to recover any additional damages as a consequence of
         such losses.

7.       Transfer

Subject to Section 6(b)(ii), neither this Agreement nor any interest or
obligation in or under this Agreement may be transferred (whether by way of
security or otherwise) by either party without the prior written consent of
the other party, except that:--

                                    D-1-10
<PAGE>

(a) a party may make such a transfer of this Agreement pursuant to a
consolidation or amalgamation with, or merger with or into, or transfer of all
or substantially all its assets to, another entity (but without prejudice to
any other right or remedy under this Agreement); and

(b) a party may make such a transfer of all or any part of its interest in any
amount payable to it from a Defaulting Party under Section 6(e).

Any purported transfer that is not in compliance with this Section will be
void.

8.       Contractual Currency

(a)      Payment in the Contractual Currency. Each payment under this
Agreement will be made in the relevant currency specified in this Agreement
for that payment (the "Contractual Currency"). To the extent permitted by
applicable law, any obligation to make payments under this Agreement in the
Contractual Currency will not be discharged or satisfied by any tender in any
currency other than the Contractual Currency, except to the extent such tender
results in the actual receipt by the party to which payment is owed, acting in
a reasonable manner and in good faith in converting the currency so tendered
into the Contractual Currency, of the full amount in the Contractual Currency
of all amounts payable in respect of this Agreement. If for any reason the
amount in the Contractual Currency so received falls short of the amount in
the Contractual Currency payable in respect of this Agreement, the party
required to make the payment will, to the extent permitted by applicable law,
immediately pay such additional amount in the Contractual Currency as may be
necessary to compensate for the shortfall. If for any reason the amount in the
Contractual Currency so received exceeds the amount in the Contractual
Currency payable in respect of this Agreement, the party receiving the payment
will refund promptly the amount of such excess.

(b)      Judgments. To the extent permitted by applicable law, if any judgment
or order expressed in a currency other than the Contractual Currency is
rendered (i) for the payment of any amount owing in respect of this Agreement,
(ii) for the payment of any amount relating to any early termination in
respect of this Agreement or (iii) in respect of a judgment or order of
another court for the payment of any amount described in (i) or (ii) above,
the party seeking recovery, after recovery in full of the aggregate amount to
which such party is entitled pursuant to the judgment or order, will be
entitled to receive immediately from the other party the amount of any
shortfall of the Contractual Currency received by such party as a consequence
of sums paid in such other currency and will refund promptly to the other
party any excess of the Contractual Currency received by such party as a
consequence of sums paid in such other currency if such shortfall or such
excess arises or results from any variation between the rate of exchange at
which the Contractual Currency is converted into the currency of the judgment
or order for the purposes of such judgment or order and the rate of exchange
at which such party is able, acting in a reasonable manner and in good faith
in converting the currency received into the Contractual Currency, to purchase
the Contractual Currency with the amount of the currency of the judgment or
order actually received by such party. The term "rate of exchange" includes,
without limitation, any premiums and costs of exchange payable in connection
with the purchase of or conversion into the Contractual Currency.

(c)      Separate Indemnities. To the extent permitted by applicable law,
hese indemnities constitute separate and independent obligations from the
other obligations in this Agreement, will be enforceable as separate and
independent causes of action, will apply notwithstanding any indulgence
granted by the party to which any payment is owed and will not be affected by
judgment being obtained or claim or proof being made for any other sums
payable in respect of this Agreement.

(d)      Evidence of Loss. For the purpose of this Section 8, it will be
sufficient for a party to demonstrate that it would have suffered a loss had
an actual exchange or purchase been made.

                                    D-1-11
<PAGE>

9.       Miscellaneous

(a)      Entire Agreement. This Agreement constitutes the entire agreement and
understanding of the parties with respect to its subject matter and supersedes
all oral communication and prior writings with respect thereto.

(b)      Amendments. No amendment, modification or waiver in respect of this
Agreement will be effective unless in writing (including a writing evidenced
by a facsimile transmission) and executed by each of the parties or confirmed
by an exchange of telexes or electronic messages on an electronic messaging
system.

(c)      Survival of Obligations. Without prejudice to Sections 2(a)(iii) and
6(c)(ii), the obligations of the parties under this Agreement will survive the
termination of any Transaction.

(d)      Remedies Cumulative. Except as provided in this Agreement, the
rights, powers, remedies and privileges provided in this Agreement are
cumulative and not exclusive of any rights, powers, remedies and privileges
provided by law.

(e)      Counterparts and Confirmations.

         (i) This Agreement (and each amendment, modification and waiver in
         respect of it) may be executed and delivered in counterparts
         (including by facsimile transmission), each of which will be deemed
         an original.

         (ii) The parties intend that they are legally bound by the terms of
         each Transaction from the moment they agree to those terms (whether
         orally or otherwise). A Confirmation shall be entered into as soon as
         practicable and may be executed and delivered in counterparts
         (including by facsimile transmission) or be created by an exchange of
         telexes or by an exchange of electronic messages on an electronic
         messaging system, which in each case will be sufficient for all
         purposes to evidence a binding supplement to this Agreement. The
         parties will specify therein or through another effective means that
         any such counterpart, telex or electronic message constitutes a
         Confirmation.

(f)      No Waiver of Rights. A failure or delay in exercising any right,
power or privilege in respect of this Agreement will not be presumed to
operate as a waiver, and a single or partial exercise of any right, power or
privilege will not be presumed to preclude any subsequent or further exercise,
of that right, power or privilege or the exercise of any other right, power or
privilege.

(g)      Headings. The headings used in this Agreement are for convenience of
reference only and are not to affect the construction of or to be taken into
consideration in interpreting this Agreement.

10.      Offices; Multibranch Parties

(a)      If Section 10(a) is specified in the Schedule as applying, each party
that enters into a Transaction through an Office other than its head or home
office represents to the other party that, notwithstanding the place of
booking office or jurisdiction of incorporation or organisation of such party,
the obligations of such party are the same as if it had entered into the
Transaction through its head or home office. This representation will be
deemed to be repeated by such party on each date on which a Transaction is
entered into.

(b)      Neither party may change the Office through which it makes and
receives payments or deliveries for the purpose of a Transaction without the
prior written consent of the other party.

(c)      If a party is specified as a Multibranch Party in the Schedule, such
Multibranch Party may make and receive payments or deliveries under any
Transaction through any Office listed in the Schedule, and the Office through
which it makes and receives payments or deliveries with respect to a
Transaction will be specified in the relevant Confirmation.

11.      Expenses

A Defaulting Party will, on demand, indemnify and hold harmless the other
party for and against all reasonable out-of-pocket expenses, including legal
fees and Stamp Tax, incurred by such other party by reason of the enforcement
and protection of its rights under this Agreement or any Credit Support
Document

                                    D-1-12
<PAGE>

to which the Defaulting Party is a party or by reason of the early termination
of any Transaction, including, but not limited to, costs of collection.

12.      Notices

(a)      Effectiveness. Any notice or other communication in respect of this
Agreement may be given in any manner set forth below (except that a notice or
other communication under Section 5 or 6 may not be given by facsimile
transmission or electronic messaging system) to the address or number or in
accordance with the electronic messaging system details provided (see the
Schedule) and will be deemed effective as indicated:--

         (i) if in writing and delivered in person or by courier, on the date
         it is delivered;

         (ii) if sent by telex, on the date the recipient's answerback is
         received;

         (iii) if sent by facsimile transmission, on the date that
         transmission is received by a responsible employee of the recipient
         in legible form (it being agreed that the burden of proving receipt
         will be on the sender and will not be met by a transmission report
         generated by the sender's facsimile machine);

         (iv) if sent by certified or registered mail (airmail, if overseas)
         or the equivalent (return receipt requested), on the date that mail
         is delivered or its delivery is attempted; or

         (v) if sent by electronic messaging system, on the date that
         electronic message is received,

unless the date of that delivery (or attempted delivery) or that receipt as
applicable, is not a Local Business Day or that communication is delivered (or
attempted) or received, as applicable, after the close of business on a Local
Business Day, in which case that communication shall be deemed given and
effective on the first following day that is a Local Business Day.

(b)      Change of Addresses. Either party may by notice to the other change
the address, telex or facsimile number or electronic messaging system details
at which notices or other communications are to be given to it.

13.      Governing Law and Jurisdiction

(a)      Governing Law. This Agreement will be governed by and construed in
accordance with the law specified in the Schedule.

(b)      Jurisdiction. With respect to any suit, action or proceedings
relating to this Agreement ("Proceedings"), each party irrevocably:--

         (i) submits to the jurisdiction of the English courts, if this
         Agreement is expressed to be governed by English law, or to the
         non-exclusive jurisdiction of the courts of the State of New York and
         the United States District Court located in the Borough of Manhattan
         in New York City, if this Agreement is expressed to be governed by
         the laws of the State of New York; and

         (ii) waives any objection which it may have at any time to the laying
         of venue of any Proceedings brought in any such court, waives any
         claim that such Proceedings have been brought in an inconvenient
         forum and further waives the right to object, with respect to such
         Proceedings, that such court does not have any jurisdiction over such
         party.

Nothing in this Agreement precludes either party from bringing Proceedings in
any other jurisdiction (outside, if this Agreement is expressed to be governed
by English law, the Contracting States, as defined in Section 1(3) of the
Civil Jurisdiction and Judgments Act 1982 or any modification, extension or
re-enactment thereof for the time being in force) nor will the bringing of
Proceedings in any one or more jurisdictions preclude the bringing of
Proceedings in any other jurisdiction.

                                    D-1-13
<PAGE>

(c) Service of Process. Each party irrevocably appoints the Process Agent (if
any) specified opposite its name in the Schedule to receive, for it and on its
behalf, service of process in any Proceedings. If for any reason any party's
Process Agent is unable to act as such, such party will promptly notify the
other party and within 30 days appoint a substitute process agent acceptable
to the other party. The parties irrevocably consent to service of process
given in the manner provided for notices in Section 12. Nothing in this
Agreement will affect the right of either party to serve process in any other
manner permitted by law.

(d) Waiver of Immunities. Each party irrevocably waives, to the fullest extent
permitted by applicable law, with respect to itself and its revenues and
assets (irrespective of their use or intended use), all immunity on the
grounds of sovereignty or other similar grounds from (i) suit, (ii)
jurisdiction of any court, (iii) relief by way of injunction, order for
specific performance or for recovery of property, (iv) attachment of its
assets (whether before or after judgment) and (v) execution or enforcement of
any judgment to which it or its revenues or assets might otherwise be entitled
in any Proceedings in the courts of any jurisdiction and irrevocably agrees,
to the extent permitted by applicable law, that it will not claim any such
immunity in any Proceedings.

14.      Definitions

As used in this Agreement: --

"Additional Termination Event" has the meaning specified in Section 5(b).

"Affected Party" has the meaning specified in Section 5(b).

"Affected Transactions" means (a) with respect to any Termination Event
consisting of an Illegality, Tax Event or Tax Event Upon Merger, all
Transactions affected by the occurrence of such Termination Event and (b) with
respect to any other Termination Event, all Transactions.

"Affiliate" means, subject to the Schedule, in relation to any person, any
entity controlled, directly or indirectly, by the person, any entity that
controls, directly or indirectly, the person or any entity directly or
indirectly under common control with the person. For this purpose, "control"
of any entity or person means ownership of a majority of the voting power of
the entity or person.

"Applicable Rate" means: --

(a)      in respect of obligations payable or deliverable (or which would have
been but for Section 2(a)(iii)) by a Defaulting Party, the Default Rate;

(b)      in respect of an obligation to pay an amount under Section 6(e) of
either party from and after the date (determined in accordance with Section
6(d)(ii)) on which that amount is payable, the Default Rate;

(c)      in respect of all other obligations payable or deliverable (or which
would have been but for Section 2(a)(iii)) by a Non-defaulting Party, the
Non-default Rate; and

(d)      in all other cases, the Termination Rate.

"Burdened Party" has the meaning specified in Section 5(b).

"Change in Tax Law" means the enactment, promulgation, execution or
ratification of, or any change in or amendment to, any law (or in the
application or official interpretation of any law) that occurs on or after the
date on which the relevant Transaction is entered into.

"consent" includes a consent, approval, action, authorisation, exemption,
notice, filing, registration or exchange control consent.

"Credit Event Upon Merger" has the meaning specified in Section 5(b).

"Credit Support Document" means any agreement or instrument that is specified
as such in this Agreement.

                                    D-1-14
<PAGE>

"Credit Support Provider" has the meaning specified in the Schedule.

"Default Rate" means a rate per annum equal to the cost (without proof or
evidence of any actual cost) to the relevant payee (as certified by it) if it
were to fund or of funding the relevant amount plus 1% per annum.

"Defaulting Party" has the meaning specified in Section 6(a).

"Early Termination Date" means the date determined in accordance with Section
6(a) or 6(b)(iv).

"Event of Default" has the meaning specified in Section 5(a) and, if
applicable, in the Schedule.

"Illegality" has the meaning specified in Section 5(b).

"Indemnifiable Tax" means any Tax other than a Tax that would not be imposed
in respect of a payment under this Agreement but for a present or former
connection between the jurisdiction of the government or taxation authority
imposing such Tax and the recipient of such payment or a person related to
such recipient (including, without limitation, a connection arising from such
recipient or related person being or having been a citizen or resident of such
jurisdiction, or being or having been organised, present or engaged in a trade
or business in such jurisdiction, or having or having had a permanent
establishment or fixed place of business in such jurisdiction, but excluding a
connection arising solely from such recipient or related person having
executed, delivered, performed its obligations or received a payment under, or
enforced, this Agreement or a Credit Support Document).

"law" includes any treaty, law, rule or regulation (as modified, in the case
of tax matters, by the practice of any relevant governmental revenue
authority) and "lawful" and "unlawful" will be construed accordingly.

"Local Business Day" means, subject to the Schedule, a day on which commercial
banks are open for business (including dealings in foreign exchange and
foreign currency deposits) (a) in relation to any obligation under Section
2(a)(i), in the place(s) specified in the relevant Confirmation or, if not so
specified, as otherwise agreed by the parties in writing or determined
pursuant to provisions contained, or incorporated by reference, in this
Agreement, (b) in relation to any other payment, in the place where the
relevant account is located and, if different. in the principal financial
centre, if any, of the currency of such payment, (c) in relation to any notice
or other communication, including notice contemplated under Section 5(a)(i),
in the city specified in the address for notice provided by the recipient and,
in the case of a notice contemplated by Section 2(b), in the place where the
relevant new account is to be located and (d) in relation to Section
5(a)(v)(2), in the relevant locations for performance with respect to such
Specified Transaction.

"Loss" means, with respect to this Agreement or one or more Terminated
Transactions, as the case may be, and a party, the Termination Currency
Equivalent of an amount that party reasonably determines in good faith to be
its total losses and costs (or gain, in which case expressed as a negative
number) in connection with this Agreement or that Terminated Transaction or
group of Terminated Transactions, as the case may be, including any loss of
bargain, cost of funding or, at the election of such party but without
duplication, loss or cost incurred as a result of its terminating,
liquidating, obtaining or reestablishing any hedge or related trading position
(or any gain resulting from any of them). Loss includes losses and costs (or
gains) in respect of any payment or delivery required to have been made
(assuming satisfaction of each applicable condition precedent) on or before
the relevant Early Termination Date and not made, except, so as to avoid
duplication, if Section 6(e)(i)(1) or (3) or 6(e)(ii)(2)(A) applies. Loss does
not include a party's legal fees and out-of-pocket expenses referred to under
Section 11. A party will determine its Loss as of the relevant Early
Termination Date, or, if that is not reasonably practicable, as of the
earliest date thereafter as is reasonably practicable. A party may (but need
not) determine its Loss by reference to quotations of relevant rates or prices
from one or more leading dealers in the relevant markets.

"Market Quotation" means, with respect to one or more Terminated Transactions
and a party making the determination, an amount determined on the basis of
quotations from Reference Market-makers. Each quotation will be for an amount,
if any, that would be paid to such party (expressed as a negative number) or
by such party (expressed as a positive number) in consideration of an
agreement between such party (taking into account any existing Credit Support
Document with respect to the obligations of such party) and the quoting
Reference Market-maker to enter into a transaction (the "Replacement
Transaction") that would have the effect of preserving for such party the
economic equivalent of any payment or delivery (whether

                                    D-1-15
<PAGE>

the underlying obligation was absolute or contingent and assuming the
satisfaction of each applicable condition precedent) by the parties under
Section 2(a)(i) in respect of such Terminated Transaction or group of
Terminated Transactions that would, but for the occurrence of the relevant
Early Termination Date, have been required after that date. For this purpose,
Unpaid Amounts in respect of the Terminated Transaction or group of Terminated
Transactions are to be excluded but, without limitation, any payment or
delivery that would, but for the relevant Early Termination Date, have been
required (assuming satisfaction of each applicable condition precedent) after
that Early Termination Date is to be included. The Replacement Transaction
would be subject to such documentation as such party and the Reference
Market-maker may, in good faith, agree. The party making the determination (or
its agent) will request each Reference Market-maker to provide its quotation
to the extent reasonably practicable as of the same day and time (without
regard to different time zones) on or as soon as reasonably practicable after
the relevant Early Termination Date. The day and time as of which those
quotations are to be obtained will be selected in good faith by the party
obliged to make a determination under Section 6(e), and, if each party is so
obliged, after consultation with the other. If more than three quotations are
provided, the Market Quotation will be the arithmetic mean of the quotations,
without regard to the quotations having the highest and lowest values, If
exactly three such quotations are provided, the Market Quotation will be the
quotation remaining after disregarding the highest and lowest quotations. For
this purpose, if more than one quotation has the same highest value or lowest
value, then one of such quotations shall be disregarded. If fewer than three
quotations are provided, it will be deemed that the Market Quotation in
respect of such Terminated Transaction or group of Terminated Transactions
cannot be determined.

"Non-default Rate" means a rate per annum equal to the cost (without proof or
evidence of any actual cost) to the Non-defaulting Party (as certified by it)
if it were to fund the relevant amount.

"Non-defaulting Party" has the meaning specified in Section 6(a).

"Office" means a branch or office of a party, which may be such party's head
or home office.

"Potential Event of Default" means any event which, with the giving of notice
or the lapse of time or both, would constitute an Event of Default.

"Reference Market-makers" means four leading dealers in the relevant market
selected by the party determining a Market Quotation in good faith (a) from
among dealers of the highest credit standing which satisfy all the criteria
that such party applies generally at the time in deciding whether to offer or
to make an extension of credit and (b) to the extent practicable, from among
such dealers having an office in the same city.

"Relevant Jurisdiction" means, with respect to a party, the jurisdictions (a)
in which the party is incorporated, organised, managed and controlled or
considered to have its seat, (b) where an Office through which the party is
acting for purposes of this Agreement is located, (c) in which the party
executes this Agreement and (d) in relation to any payment, from or through
which such payment is made.

"Scheduled Payment Date" means a date on which a payment or delivery is to be
made under Section 2(a)(i) with respect to a Transaction.

"Set-off" means set-off, offset, combination of accounts, right of retention
or withholding or similar right or requirement to which the payer of an amount
under Section 6 is entitled or subject (whether arising under this Agreement,
another contract, applicable law or otherwise) that is exercised by, or
imposed on, such payer.

"Settlement Amount" means, with respect to a party and any Early Termination
Date, the sum of.-

(a) the Termination Currency Equivalent of the Market Quotations (whether
positive or negative) for each Terminated Transaction or group of Terminated
Transactions for which a Market Quotation is determined; and

(b) such party's Loss (whether positive or negative and without reference to
any Unpaid Amounts) for each Terminated Transaction or group of Terminated
Transactions for which a Market Quotation cannot be determined or would not
(in the reasonable belief of the party making the determination) produce a
commercially reasonable result.

"Specified Entity" has the meaning specified in the Schedule.

                                    D-1-16
<PAGE>

"Specified Indebtedness" means, subject to the Schedule, any obligation
(whether present or future, contingent or otherwise, as principal or surety or
otherwise) in respect of borrowed money.

"Specified Transaction" means, subject to the Schedule, (a) any transaction
(including an agreement with respect thereto) now existing or hereafter
entered into between one party to this Agreement (or any Credit Support
Provider of such party or any applicable Specified Entity of such party) and
the other party to this Agreement (or any Credit Support Provider of such
other party or any applicable Specified Entity of such other party) which is a
rate swap transaction, basis swap, forward rate transaction, commodity swap,
commodity option, equity or equity index swap, equity or equity index option,
bond option, interest rate option, foreign exchange transaction, cap
transaction, floor transaction, collar transaction, currency swap transaction,
cross-currency rate swap transaction, currency option or any other similar
transaction (including any option with respect to any of these transactions),
(b) any combination of these transactions and (c) any other transaction
identified as a Specified Transaction in this Agreement or the relevant
confirmation.

"Stamp Tax" means any stamp, registration, documentation or similar tax.

"Tax" means any present or future tax, levy, impost, duty, charge, assessment
or fee of any nature (including interest, penalties and additions thereto)
that is imposed by any government or other taxing authority in respect of any
payment under this Agreement other than a stamp, registration, documentation
or similar tax.

"Tax Event" has the meaning specified in Section 5(b).

"Tax Event Upon Merger" has the meaning specified in Section 5(b).

"Terminated Transactions" means with respect to any Early Termination Date (a)
if resulting from a Termination Event, all Affected Transactions and (b) if
resulting from an Event of Default, all Transactions (in either case) in
effect immediately before the effectiveness of the notice designating that
Early Termination Date (or, if "Automatic Early Termination" applies,
immediately before that Early Termination Date).

"Termination Currency" has the meaning specified in the Schedule.

"Termination Currency Equivalent" means, in respect of any amount denominated
in the Termination Currency, such Termination Currency amount and, in respect
of any amount denominated in a currency other than the Termination Currency
(the "Other Currency"), the amount in the Termination Currency determined by
the party making the relevant determination as being required to purchase such
amount of such Other Currency as at the relevant Early Termination Date, or,
if the relevant Market Quotation or Loss (as the case may be), is determined
as of a later date, that later date, with the Termination Currency at the rate
equal to the spot exchange rate of the foreign exchange agent (selected as
provided below) for the purchase of such Other Currency with the Termination
Currency at or about 11:00 a.m. (in the city in which such foreign exchange
agent is located) on such date as would be customary for the determination of
such a rate for the purchase of such Other Currency for value on the relevant
Early Termination Date or that later date. The foreign exchange agent will, if
only one party is obliged to make a determination under Section 6(e), be
selected in good faith by that party and otherwise will be agreed by the
parties.

"Termination Event" means an Illegality, a Tax Event or a Tax Event Upon
Merger or, if specified to be applicable, a Credit Event Upon Merger or an
Additional Termination Event.

"Termination Rate" means a rate per annum equal to the arithmetic mean of the
cost (without proof or evidence of any actual cost) to each party (as
certified by such party) if it were to fund or of funding such amounts.

"Unpaid Amounts" owing to any party means, with respect to an Early
Termination Date, the aggregate of (a) in respect of all Terminated
Transactions, the amounts that became payable (or that would have become
payable but for Section 2(a)(iii)) to such party under Section 2(a)(i) on or
prior to such Early Termination Date and which remain unpaid as at such Early
Termination Date and (b) in respect of each Terminated Transaction, for each
obligation under Section 2(a)(i) which was (or would have been but for Section
2(a)(iii)) required to be settled by delivery to such party on or prior to
such Early Termination Date and which has not been so settled as at such Early
Termination Date, an amount equal to the fair market

                                    D-1-17
<PAGE>

value of that which was (or would have been) required to be delivered as of
the originally scheduled date for delivery, in each case together with (to the
extent permitted under applicable law) interest, in the currency of such
amounts, from (and including) the date such amounts or obligations were or
would have been required to have been paid or performed to (but excluding)
such Early Termination Date, at the Applicable Rate. Such amounts of interest
will be calculated on the basis of daily compounding and the actual number of
days elapsed. The fair market value of any obligation referred to in clause
(b) above shall be reasonably determined by the party obliged to make the
determination under Section 6(e) or, if each party is so obliged, it shall be
the average of the Termination Currency Equivalents of the fair market values
reasonably determined by both parties.

IN WITNESS WHEREOF the parties have executed this document on the respective
dates specified below with effect from the date specified on the first page of
this document.

WACHOVIA BANK, NATIONAL ASSOCIATION     STRATS(SM) TRUST FOR GOLDMAN SACHS
          (Name of Party)               CAPITAL I SECURITIES, SERIES 2005-3
                                                    (Name of Party)

By: ------------------------------      By: ----------------------------------
    Name:                                   Name:
    Title:                                  Title:
    Date:                                   Date:

                                    D-1-18

<PAGE>

                                                                   Exhibit D-2

                                   SCHEDULE
                                    to the
                               MASTER AGREEMENT
                    dated as of September 30, 2005 between
                WACHOVIA BANK, NATIONAL ASSOCIATION ("Party A")
                                      and
           STRATS(SM) TRUST FOR GOLDMAN SACHS CAPITAL I SECURITIES,
                           SERIES 2005-3 ("Party B")

Part 1.  Termination Provisions

(a)      "Specified Entity" means, with respect to Party A for all purposes of
         this Agreement, none specified, and with respect to Party B for all
         purposes of this Agreement, none specified.

(b)      "Specified Transaction" has its meaning as defined in Section 14 of
         this Agreement.

(c)      "Cross Default" does not apply to Party A or Party B.

(d)      "Credit Event Upon Merger" does not apply to Party A or Party B.

(e)      "Automatic Early Termination" does not apply to Party A or Party B.

(f)      Payments on Early Termination. Except as otherwise provided in this
         Schedule, "Market Quotation" and the "Second Method" apply. In the
         case of any Terminated Transaction that is, or is subject to, any
         unexercised option, the words "economic equivalent of any payment or
         delivery" appearing in the definition of "Market Quotation" shall be
         construed to take into account the economic equivalent of the option.
         Additionally, in the event an Early Termination Date is designated by
         Party B in connection with an Event of Default or Termination Event
         with respect to which Party A is the Defaulting Party or sole
         Affected Party, then in no event shall any Settlement Amount be
         payable under Section 6(e) of the Agreement by either Party A or
         Party B.

(g)      "Termination Currency" means United States Dollars.

(h)      Limitation on Defaults. The Events of Default specified in Section 5
         of this Agreement shall not apply to Party A or Party B except for
         the following:

         (i)      Section 5(a)(i) of this Agreement (Failure to Pay or
                  Deliver); provided, however, notwithstanding anything
                  contained in Section 5(a)(i) of this Agreement, in no event
                  shall any failure to pay by: (x) Party A during the
                  occurrence of any Deferral Period (as defined in the Trust
                  Agreement) and continuing until such time as any amounts
                  owed by Party B during such Deferral Period have been paid
                  in full; or (y) Party B during the occurrence of any
                  Deferral Period, constitute an Event of Default under
                  Section 5(a)(i) of this Agreement; provided, further, that
                  notwithstanding the foregoing provision, during any such
                  Deferral Period, the "Default Interest"

                                    D-2-1
<PAGE>

                  provisions of Section 2(e) hereof shall apply with respect
                  to any amounts which are otherwise due and payable, but have
                  not been paid hereunder (expressly including any
                  non-payments which, as a result of subsection (x) or (y)
                  above, would not constitute an Event of Default under
                  Section 5(a)(i) of this Agreement) and for purposes hereof
                  only, the Default Rate shall be deemed to be 6.345% and
                  compounded semi-annually on a 30/360 basis notwithstanding
                  any provisions in Section 2(e) to the contrary.

         (ii)     Section 5(a)(vii) of this Agreement (Bankruptcy), provided
                  that, the failure to make any payment of interest on or
                  principal of the Certificates which does not give rise to an
                  event of default pursuant to the terms of the Trust
                  Agreement shall not be deemed to constitute a Bankruptcy
                  within the meaning of clause (2) thereof with respect to
                  Party B; and

         (iii)    Section 5(a)(viii) of this Agreement (Merger Without
                  Assumption).

(i)      Additional Termination Events.

         (i)      The occurrence of any of the following events shall be an
                  Additional Termination Event:

                  (A)      the unsecured and unsubordinated debt obligations
                           of Party A are assigned a rating by S&P below the
                           Hedge Counterparty Required Rating ("S&P Required
                           Rating Downgrade Event"), and Party A fails to: (x)
                           make a Permitted Transfer in accordance with the
                           provisions of Part 6(a)(ii) of this Schedule; (y)
                           execute a Credit Support Annex, and post any
                           required collateral thereunder, in a form which S&P
                           confirms in writing will not cause the reduction or
                           withdrawal of its then current rating of any
                           outstanding class of Certificates under the Trust
                           Agreement with respect to which it has previously
                           issued a rating; or (z) provide Alternative Credit
                           Support (as defined below) with respect to the
                           Affected Transactions, within seven (7) Business
                           Days of the date on which Party A's unsecured and
                           unsubordinated debt obligations were assigned a
                           rating by S&P below the Hedge Counterparty Required
                           Rating. Party A shall notify Party B within one (1)
                           Business Day of the occurrence of a S&P Required
                           Rating Downgrade Event;

                  (B)      The Certificates become due and payable prior to
                           their final scheduled maturity date for any reason;

                  (C)      Party B fails to comply with sub-paragraph (e)(i)
                           of Part 6 of this Schedule; any prepayment,
                           redemption, retirement, liquidation or distribution
                           of the Underlying Securities (including as a result
                           of a Payment Default, an Acceleration or an SEC
                           Reporting Failure (as such terms are defined in the
                           Trust Agreement)) or other prepayment in full of
                           all Certificates outstanding occurs under the Trust
                           Agreement (or any notice is given to that effect
                           and such prepayment, redemption, retirement,
                           liquidation or distribution of the

                                    D-2-2
<PAGE>

                           Underlying Securities is not capable of being
                           rescinded); any Trust Termination Event (as defined
                           in the Trust Agreement) occurs under the Trust
                           Agreement (or any notice is given by the Trustee or
                           any other authorized party to that effect) and the
                           Trustee, the Certificateholders or any other
                           authorized party thereunder takes any action or
                           exercises any rights or remedies under the Trust
                           Agreement or under law that would result in (1) the
                           appropriation of all right, title and interest in
                           and to the assets under the Trust Agreement in
                           satisfaction, in whole or in part, of the
                           obligations secured thereby, (2) the sale,
                           liquidation or disposition of the assets under the
                           Trust Agreement and the application of the proceeds
                           thereof, in whole or in part, to the obligations
                           secured thereby, or (3) the release of the security
                           interest in the assets granted under the Trust
                           Agreement in exchange for receiving either the
                           payment, in whole or in part, of the obligations
                           secured thereby or substitute collateral or credit
                           support; or

                  (D)      Party B fails to comply with sub-paragraph (j)(i)
                           of Part 1 of this Schedule, or any Additional
                           Termination Event occurs under paragraph (j) of
                           Part 1 of this Schedule in either event to the
                           extent of the applicable Affected Notional Amount
                           as described in that paragraph.

         (ii)     For purposes of the right to terminate under Section
                  6(b)(iv), Party A will be the sole Affected Party for any
                  Additional Termination Event described in clause (A) of
                  sub-paragraph (i) above, and Party B will be the sole
                  Affected Party for any other Additional Termination Event.

         (iii)    Notwithstanding which party is the Affected Party for any
                  Additional Termination Event, upon the occurrence of an
                  Early Termination Date for any Additional Termination Event
                  under this Part 1(i), Party A shall make the calculations
                  under Section 6(e) of this Agreement as though it were the
                  non-Affected Party for purposes of Section 6(e)(ii)(1) of
                  this Agreement.

         (iv)     "Hedge Counterparty Required Rating" means, as applicable,
                  at any time that any Certificates are outstanding under the
                  Trust Agreement and have a long-term rating by S&P, the
                  lower of: (x) the long-term rating assigned to the
                  Certificates by S&P; and (y) A- by S&P (for so long as any
                  Certificates are outstanding under the Trust Agreement and
                  are rated by S&P); provided that should S&P effect an
                  overall downward adjustment of its short-term or long-term
                  ratings, then the applicable Hedge Counterparty Required
                  Rating shall be downwardly adjusted accordingly; provided
                  further, that any adjustment to a rating shall be subject to
                  the prior written consent of S&P.

         (v)      "Alternative Credit Support" means an absolute and
                  unconditional guarantee, credit intermediation arrangement,
                  letter of credit or other additional credit support or
                  collateral, in a form which meets S&P's then current
                  criteria with respect to such types of credit support
                  reasonably acceptable to S&P and for which S&P confirms in
                  writing that such support will not cause the reduction or
                  withdrawal of its then

                                    D-2-3
<PAGE>

                  current rating of any outstanding class of Certificates
                  under the Trust Agreement with respect to which it has
                  previously issued a rating.

         (vi)     "S&P" means, Standard & Poor's Ratings Services, a division
                  of The McGraw-Hill Companies ("S&P") (so long as any
                  Certificates deemed outstanding under the Trust Agreement
                  are rated by S&P).

(j)      Mandatory Reduction Events. To protect Party A's interest in the
         Trust Agreement as a source of payment for Party B's obligations
         hereunder, including the priority of those payments under the Trust
         Agreement, the following provisions shall apply with respect to all
         Transactions hereunder:

         (i)      If either (x) without the prior written consent of Party A,
                  Party B enters into any "Swap Agreement" (as defined in the
                  Trust Agreement) on any date (a "Principal Payment Date")
                  with any person or entity that would result in the Hedge
                  Notional Amount exceeding the remaining Principal Balance on
                  any date or (y) as the result of any payment, repayment,
                  retirement or redemption of any amount of the Principal
                  Balance under the Trust Agreement on any date (a "Principal
                  Payment Date"), (A) the Principal Balance would be reduced
                  to zero, or (B) the Hedge Notional Amount would exceed the
                  remaining Principal Balance (after giving effect to that
                  repayment), (each, a "Mandatory Reduction Event"), then not
                  later than 1:00 p.m. (New York City time) on the date
                  ("Mandatory Reduction Date") which is the second New York
                  Business Day prior to that Principal Payment Date, Party B
                  shall:

                  (1)      notify Party A of that Mandatory Reduction Event,
                           including the amount to be repaid and the
                           outstanding Hedge Notional Amount; and

                  (2)      specify in that notice each outstanding Transaction
                           hereunder and the corresponding amount by which the
                           Transactional Notional Amount of that Transaction
                           is to be reduced for that Mandatory Reduction Event
                           ("Affected Notional Amount") so that the Hedge
                           Notional Amount for any date (after giving effect
                           to all such reductions) would not exceed the
                           Principal Balance for that date (after giving
                           effect to any repayment) (except that if the
                           Principal Balance is reduced to zero, the Hedge
                           Notional Amount shall be reduced to zero).

         "Hedge Notional Amount" means, as of the date of determination, an
         amount equal to the aggregate Notional Amount outstanding on that
         date and for the then current Calculation Period of all Transactions
         outstanding under any Swap Agreement (as defined in the Trust
         Agreement) then in effect.

         "Principal Balance" means, on any date, the aggregate principal
         amount of the Certificates, outstanding under the Trust Agreement on
         that date, after giving effect to all repayments, redemptions,
         advances or distributions of principal thereon on that date.

                                    D-2-4
<PAGE>

         (ii)     For each Transaction for which a corresponding Affected
                  Notional Amount is specified ("Affected Transaction")
                  pursuant to sub-paragraph (i) above, the Notional Amount of
                  that Affected Transaction shall be reduced as of the
                  Mandatory Reduction Date by an amount equal to the Affected
                  Notional Amount (and, if the Notional Amount otherwise
                  accretes or amortizes after the Mandatory Reduction Date,
                  the effect of that reduction shall be to reduce
                  proportionately the Notional Amount of each future
                  Calculation Period remaining under the Transaction), and an
                  Additional Termination Event and Early Termination Date
                  shall be deemed to have occurred on the Mandatory Reduction
                  Date for that Transaction and Party B will be the sole
                  Affected Party. For purposes of such Early Termination Date,
                  the term "Terminated Transaction" as used in Section 6(e) of
                  this Agreement shall be only that part of the Affected
                  Transaction relating to the Affected Notional Amount, and
                  the remainder of the Affected Transaction shall continue in
                  full force and effect as a Transaction hereunder subject to
                  the terms of this Agreement. The amount payable under
                  Section 6(e) of this Agreement with respect to any such
                  Early Termination Date shall be due and payable in
                  accordance with such Section 6(e), provided that such
                  payment shall be made no later than the next "Distribution
                  Date" under the Trust Agreement to occur after the Mandatory
                  Reduction Date, and provided further that the Market
                  Quotation with respect to any Terminated Transaction under
                  this sub-paragraph (ii) shall be determined on the basis of
                  the quotation of one Reference Market-maker selected by
                  Party A, which may be Party A to the extent its quotation is
                  reasonably determined in good faith.

(k)      Events of Default. An Event of Default shall not occur with respect
         to Party A under Section 5(a)(v)(1) or (2) or Section 5(a)(vi) when
         the failure to pay or deliver, or the default, event of default or
         other similar condition or event, as the case may be, arises solely
         (i) out of a wire transfer problem or an operational or
         administrative error or omission (so long as the required funds or
         property required to make that payment or delivery were otherwise
         available to Party A), or (ii) from the general unavailability of the
         relevant currency due to exchange controls or other similar
         governmental action, but in either case only if the payment or
         delivery is made within three Local Business Days after the problem
         has been corrected, the error or omission has been discovered or the
         currency becomes generally available.

(l)      Modification of Section 5(a)(i) - Failure to Pay or Deliver. Section
         5(a)(i) is hereby amended to add the following language immediately
         after the word "party" at the end of the third line of such
         subsection "provided, however, such cure period shall not apply with
         respect to any amounts payable on the Termination Date".

(m)      Reports. For purposes hereof, Party B shall cause to be delivered to
         Party A within 10 days of the end of each calendar month a statement
         ("Reporting Statement") showing the Stated Amount of all Outstanding
         Certificates as of the end of such month and the Hedge Notional
         Amount as of the end of such month and each following month during
         the term of this Agreement for all outstanding Transactions under all
         Swap Agreements which Party B has entered into, whether the same have
         already commenced or are scheduled to commence on a future date.

                                    D-2-5
<PAGE>

Part     2. Tax Provisions

(a)      Payer Tax Representations. For the purpose of Section 3(e) of this
         Agreement, each party makes the following representation:

         It is not required by any applicable law, as modified by the practice
         of any relevant governmental revenue authority, of any Relevant
         Jurisdiction to make any deduction or withholding for or on account
         of any Tax from any payment (other than interest under Section 2(e),
         6(d)(ii) or 6(e) of this Agreement) to be made by it to the other
         party under this Agreement.

         In making this representation, a party may rely on (i) the accuracy
         of any representations made by the other party pursuant to Section
         3(f) of this Agreement, (ii) the satisfaction of the agreement
         contained in Section 4(a)(i) or 4(a)(iii) of this Agreement, and the
         accuracy and effectiveness of any document provided by the other
         party pursuant to Section 4(a)(i) or 4(a)(iii) of this Agreement, and
         (iii) the satisfaction of the agreement of the other party contained
         in Section 4(d) of this Agreement, provided that it shall not be a
         breach of this representation where reliance is placed on clause (ii)
         above and the other party does not deliver a form or document under
         Section 4(a)(iii) by reason of material prejudice to its legal or
         commercial position.

(b)      Payee Tax Representations. For the purpose of Section 3(f) of this
         Agreement:

         (i)      Party A makes the following representation(s):

                  (A)      It is a national banking association organized or
                           formed under the laws of the United States and is a
                           United States resident for United States federal
                           income tax purposes.

                  (B)      Party A makes no other Payee Tax Representations.

         (ii)     Party B makes the following representation(s):

                  (A)      It is a common law trust organized or formed under
                           the laws of New York.

(c)      Tax Forms.

         (i)      Delivery of Tax Forms. For the purpose of Section 4(a)(i),
                  and without limiting Section 4(a)(iii), each party agrees to
                  duly complete, execute and deliver to the other party the
                  tax forms specified below with respect to it (A) before the
                  first Payment Date under this Agreement, (B) promptly upon
                  reasonable demand by the other party and (C) promptly upon
                  learning that any such form previously provided by the party
                  has become obsolete or incorrect.

                  In addition, in the case of any tax form that is a Periodic
                  Tax Form required to be delivered by Party B under this
                  Agreement, Party B agrees to renew such tax form

                                    D-2-6
<PAGE>

                  prior to its expiration by completing, executing and
                  delivering to Party A that tax form ("Renewal Tax Form") in
                  each succeeding third year following the year of execution
                  of any such tax form or Renewal Tax Form delivered by Party
                  B to Party A under this Agreement so that Party A receives
                  each Renewal Tax Form not later than December 31 of the
                  relevant year. "Periodic Tax Form" means any IRS Form W-9
                  that is delivered by Party B to Party A without a U.S.
                  Taxpayer Identification Number.

         (ii)     Tax Forms to be Delivered by Party A:

                  Party A will deliver a correct, complete and duly executed
                  U.S. Internal Revenue Service Form W-9 (or successor
                  thereto), together with appropriate attachments, that
                  eliminates U.S. federal withholding and backup withholding
                  tax on payments to Party A under this Agreement.

         (iii)    Tax forms to be Delivered by Party B:

                  Party B will deliver a correct, complete and duly executed
                  U.S. Internal Revenue Service Form W-9 (or successor
                  thereto), together with appropriate attachments, that
                  eliminates U.S. federal withholding and backup withholding
                  tax on payments to Party B under this Agreement.

Part 3.  Documents

(a)      Delivery of Documents. When it delivers this Agreement, each party
         shall also deliver its Closing Documents to the other party in form
         and substance reasonably satisfactory to the other party. For each
         Transaction, a party shall deliver, promptly upon request, a duly
         executed incumbency certificate for the person(s) executing the
         Confirmation for that Transaction on behalf of that party.

(b)      Closing Documents.

         (i)      For Party A, "Closing Documents" mean:

                  (A)      an opinion of Party A's counsel addressed to Party
                           B in form and substance acceptable to Party B;

                  (B)      a duly executed incumbency certificate for each
                           person executing this Agreement for Party A, or in
                           lieu thereof, a copy of the relevant pages of its
                           official signature book; and

                  (C)      each Credit Support Document (if any) specified for
                           Party A in this Schedule, together with a duly
                           executed incumbency certificate for the person(s)
                           executing that Credit Support Document, or in lieu
                           thereof, a copy of the relevant pages of its
                           official signature book.

                                    D-2-7
<PAGE>

         (ii)     For Party B, "Closing Documents" mean:

                  (A)      an opinion of Party B's counsel addressed to Party
                           A in form and substance acceptable to Party A;

                  (B)      a duly executed copy of the Trust Agreement and the
                           other operative documents relating thereto and
                           referred to therein, executed and delivered by the
                           parties thereto.

                  (C)      a copy, certified by the secretary or assistant
                           secretary of Party B, of the resolutions of the
                           board of directors or extracts from the bylaws of
                           Party B authorizing the execution, delivery and
                           performance by Party B of this Agreement and
                           authorizing Party B to enter into Transactions
                           hereunder; and

                  (D)      a duly executed certificate of the secretary or
                           assistant secretary of Party B certifying the name
                           and true signature of each person authorized to
                           execute this Agreement and enter into Transactions
                           for Party B.

Part 4.  Miscellaneous

(a)      Addresses for Notices. For purposes of Section 12(a) of this
         Agreement, all notices to a party shall, with respect to any
         particular Transaction, be sent to its address, telex number or
         facsimile number specified in the relevant Confirmation, provided
         that any notice under Section 5 or 6 of this Agreement, and any
         notice under this Agreement not related to a particular Transaction,
         shall be sent to a party at its address, telex number or facsimile
         number specified below.

         To Party A:

         WACHOVIA BANK, NATIONAL ASSOCIATION
         301 South College, DC-8
         Charlotte, NC 28202-0600
         Attention: Bruce M. Young
         Senior Vice President, Risk Management

         Fax: (704) 383-0575
         Phone: (704) 383-8778

         To Party B:

         STRATS(SM) Trust for Goldman Sachs Capital I Securities, Series
         2005-3 U.S.
         Bank Trust National Association
         100 Wall Street, Suite 1600
         New York, New York 10005
         Attention: Corporate Trust
         Fax: (212) 809-5459

                                    D-2-8
<PAGE>

(b)      Process Agent. Not applicable.

(c)      Offices. Section 10(a) applies.

(d)      Multibranch Party. Neither party is a Multibranch Party.

(e)      "Calculation Agent" means Party A.

(f)      Credit Support Document.

         (i)      For Party A, the following is a Credit Support Document:
                  none specified.

         (ii)     For Party B, the following is a Credit Support Document:
                  none specified.

(g)      Credit Support Provider.

         (i)      For Party A, Credit Support Provider means: none specified.

         (ii)     For Party B, Credit Support Provider means: none specified.

(h)      Governing Law. This Agreement will be governed by and construed in
         accordance with the law (and not the law of conflicts except with
         respect to ss.ss. 5-1401 and 5-1402 of the New York General
         Obligations Law) of the State of New York.

(i)      Waiver of Jury Trial. To the extent permitted by applicable law, each
         party irrevocably waives any and all right to trial by jury in any
         legal proceeding in connection with this Agreement, any Credit
         Support Document to which it is a party, or any Transaction.

(j)      Netting of Payments. Section 2(c)(ii) of this Agreement will apply.

(k)      "Affiliate" has its meaning as defined in Section 14 of this
         Agreement.

Part 5.  Other Provisions

(a)      ISDA Publications.

         (i)      2000 ISDA Definitions. This Agreement and each Transaction
                  are subject to the 2000 ISDA Definitions (including its
                  Annex) published by the International Swaps and Derivatives
                  Association, Inc. (together, the "2000 ISDA Definitions")
                  and will be governed by the provisions of the 2000 ISDA
                  Definitions. The provisions of the 2000 ISDA Definitions are
                  incorporated by reference in, and shall form part of, this
                  Agreement and each Confirmation. Any reference to a "Swap
                  Transaction" in the 2000 ISDA Definitions is deemed to be a
                  reference to a "Transaction" for purposes of this Agreement
                  or any Confirmation, and any reference to a "Transaction" in
                  this Agreement or any Confirmation is deemed to be a
                  reference to a "Swap Transaction" for purposes of the 2000
                  ISDA Definitions. The provisions of this Agreement
                  (exclusive of the 2000 ISDA Definitions) shall prevail in
                  the event of any conflict between such provisions and the
                  2000 ISDA Definitions.

                                    D-2-9
<PAGE>

(b)      Additional Representations. Section 3 is amended by adding the
         following Sections 3(g), (h), (i) and (j):

         "(g) Non-Reliance. For any Relevant Agreement: (i) it acts as
         principal and not as agent; (ii) it acknowledges that the other party
         acts only at arm's length and is not its agent, broker, advisor or
         fiduciary in any respect, and any agency, brokerage, advisory or
         fiduciary services that the other party (or any of its affiliates)
         may otherwise provide to the party (or to any of its affiliates)
         excludes the Relevant Agreement; (iii) with respect to Party A, it
         understands the Relevant Agreement and those risks, has determined
         they are appropriate for it, and willingly assumes those risks, and
         with respect to Party B, it has been directed to execute the Relevant
         Agreement and it understands the Relevant Agreement and those risks
         and willingly assumes those risks; (iv) it has not relied and will
         not be relying upon any evaluation or advice (including any
         recommendation, opinion, or representation) from the other party, or
         the representatives or advisors of the other party (except
         representations expressly made in the Relevant Agreement or an
         opinion of counsel required thereunder); and (vi) if a party is
         acting as a Calculation Agent or Valuation Agent, it does so not as
         the other party's agent or fiduciary, but on an arm's length basis
         for the purpose of performing an administrative function in good
         faith.

         "Relevant Agreement" means this Agreement, each Transaction, each
         Confirmation, any Credit Support Document, and any agreement
         (including any amendment, modification, transfer or early
         termination) between the parties relating thereto or to any
         Transaction.

         (h) Eligibility. It is an "eligible contract participant" within the
         meaning of the Commodity Exchange Act (as amended by the Commodity
         Futures Modernization Act of 2000).

         (i) FDIC Requirements. If it is a bank subject to the requirements of
         12 U.S.C. ss. 1823(e), its execution, delivery and performance of
         this Agreement (including the Schedule and each Confirmation) have
         been approved by its board of directors or its loan committee, such
         approval is reflected in the minutes of said board of directors or
         loan committee, and this Agreement (including the Schedule and each
         Confirmation) will be maintained as one of its official records
         continuously from the time of its execution (or in the case of any
         Confirmation, continuously until such time as the relevant
         Transaction matures and the obligations therefor are satisfied in
         full).

         (j) ERISA. It is not (i) an employee benefit plan as defined in
         Section 3(3) of the Employee Retirement Income Security Act of 1974,
         as amended ("ERISA") or a plan as defined in Section 4975(e) of the
         Internal Revenue Code of 1986, as amended (the "Code"), subject to
         Title I of ERISA or Section 4975 of the Code, or a plan as so defined
         but which is not subject to Title I of ERISA or Section 4975 of the
         Code (each, an "ERISA Plan"), (ii) a person or entity acting on
         behalf of an ERISA Plan, or (iii) a person or entity the assets of
         which constitute assets of an ERISA Plan.

(c)      Recorded Conversations. Each party and any of its Affiliates may
         electronically record any of its telephone conversations with the
         other party or with any of the other party's Affiliates in connection
         with this Agreement or any Transaction, and any such recordings may
         be

                                    D-2-10
<PAGE>

         submitted in evidence in any proceeding to establish any matters
         pertinent to this Agreement or any Transaction.

(d)      Confirmation Procedures. Upon receipt thereof, Party B shall examine
         the terms of each Confirmation sent by Party A, and unless Party B
         objects to the terms within three New York business days after
         receipt of that Confirmation, those terms shall be deemed accepted
         and correct absent manifest error, in which case that Confirmation
         will be sufficient to form a binding supplement to this Agreement
         notwithstanding Section 9(e)(ii) of this Agreement.

Part 6.  Additional Terms Relating to the Trust Agreement

(a)      Permitted Transfers.

(i)      Notwithstanding Section 7 of this Agreement, Party A may make a
         Permitted Transfer without the prior written consent of Party B, and
         at Party A's own cost and expense, if either of the following events
         occurs:

         (A)      the unsecured and unsubordinated debt obligations of Party A
                  are rated below the Hedge Counterparty Required Rating by
                  S&P at the time of the transfer; or

         (B)      any Tax Event or Tax Event Upon Merger exists with respect
                  to Party A at the time of the transfer.

(ii)     "Permitted Transfer" means a transfer, in whole but not in part, of
         all of Party A's rights and obligations under this Agreement and
         which meets all of the following requirements:

         (A)      the transferee is a "Qualified Hedge Party" (as defined in
                  the Trust Agreement) or a recognized dealer in interest rate
                  swaps organized under the laws of the United States of
                  America or a jurisdiction located in the United States of
                  America (or another jurisdiction reasonably acceptable to
                  Party B and the Trustee under the Trust Agreement) that, at
                  the time of the transfer, maintains (or its proposed
                  guarantor maintains) the Hedge Counterparty Required Rating
                  from S&P on its unsecured and unsubordinated debt, deposit
                  or letter of credit obligations;

         (B)      S&P confirms in writing that such transfer will not result
                  in a reduction or withdrawal of its then current rating of
                  the Certificates under the Trust Agreement with respect to
                  which it has previously issued a rating;

         (C)      neither an Event of Default with respect to the transferee
                  nor a Termination Event would exist immediately after that
                  transfer;

         (D)      the transferee executes and delivers a written agreement
                  reasonably satisfactory to Party B and the Trustee under the
                  Trust Agreement in which

                                    D-2-11
<PAGE>

                  the transferee, among other things, legally and effectively
                  accepts all the rights and assumes all the obligations of
                  Party A under this Agreement; and

         (E)      such transfer otherwise complies with the terms of the Trust
                  Agreement.

(b)      Transfer. No Party to this Agreement may transfer its obligations
         under this Agreement pursuant to Section 7(a) of this Agreement
         except upon written confirmation from S&P that, any such reduction
         would not cause S&P's then-current rating on the Certificates to be
         adversely qualified, reduced, suspended or withdrawn.

(c)      Payments. All payments to Party B under this Agreement or any
         Transaction shall be made to the Certificate Account created under
         the Trust Agreement.

(d)      Set-off. Party A and Party B hereby waive any and all right of
         set-off with respect to any amounts due under this Agreement or any
         Transaction, provided that nothing herein shall be construed to waive
         or otherwise limit the netting provisions contained in Sections 2(c)
         and 6(e) of this Agreement or the setoff rights contained in any
         Credit Support Annex.

(e)      Trust Agreement

         (i)      Party B hereby acknowledges that Party A is a secured party
                  under the Trust Agreement with respect to this Agreement and
                  a third-party beneficiary under the Trust Agreement and
                  Party B agrees for the benefit of Party A that neither it
                  nor any other Person will take any action (whether in the
                  form of an amendment, a modification, waiver, approval,
                  consent or otherwise) which may have a material adverse
                  effect with respect to the rights, interest or benefits
                  granted to Party A under the Trust Agreement with respect to
                  this Agreement, whether or not this Agreement is
                  specifically referred to or identified therein.

         (ii)     On the date Party B executes and delivers this Agreement and
                  on each date on which a Transaction is entered into, Party B
                  hereby represents and warrants to Party A: that the Trust
                  Agreement is in full force and effect; that Party B is not
                  party to any separate agreement with any of the parties to
                  the Trust Agreement that would have the effect of
                  diminishing or impairing the rights, interests or benefits
                  that have been granted to Party A under, and which are
                  expressly set forth in, the Trust Agreement; that Party B's
                  obligations under this Agreement are secured under the Trust
                  Agreement; and that nothing herein violates or conflicts
                  with any of the provisions of the Trust Agreement or any
                  other documents executed in connection therewith.

(f)      Consent to Notice & Communications. Party B hereby consents to the
         giving to the Trustee of notice by Party A of Party A's address and
         telecopy and telephone numbers for all purposes of the Trust
         Agreement, and in addition, Party A shall also be entitled at any
         time to provide the Trustee with copies of this Agreement, including
         all Confirmations. In addition, Party A shall not be precluded from
         communicating with the Trustee or any party to, or any third party
         beneficiary under, the Trust Agreement for the purpose of exercising,
         enforcing or

                                    D-2-12
<PAGE>

         protecting any of Party A's rights or remedies under this Agreement
         or any rights, interests or benefits granted to Party A under the
         Trust Agreement.

(g)      No Bankruptcy Petition. Party A agrees that, prior to the date which
         is at least one year and one day after all Rated Indebtedness (as
         hereinafter defined) has been paid in full, it will not institute
         against, or join any other person or entity in instituting against,
         Party B any bankruptcy, reorganization, arrangement, insolvency,
         moratorium or liquidation proceedings, or other proceedings under
         federal or State bankruptcy or similar laws, provided that nothing
         herein shall preclude, or be deemed to estop, Party A from taking any
         action in any case or proceeding voluntarily filed or commenced by or
         on behalf of Party B or in any involuntary case or proceeding after
         it has commenced.

(h)      Limitation of Liability. Notwithstanding anything contained herein to
         the contrary, in executing this Agreement (including the Schedule and
         each Confirmation) on behalf of Party B, the Trustee is acting solely
         in its capacity as trustee of Party B and not in its individual
         capacity, and in no event shall the Trustee, in its individual
         capacity or as beneficial owner of Party B, have any liability for
         the representations, warranties, covenants, agreements or other
         obligations of Party B hereunder, for which recourse shall be had
         solely to the assets of Party B.

(i)      Party A Rights Solely Against Collateral. The liability of Party B to
         Party A hereunder is limited in recourse to the assets of Party B and
         to the extent that the proceeds of such assets, when applied in
         accordance with the Trust Agreement, are insufficient to meet the
         obligations of Party B hereunder in full, Party B shall have no
         further liability in respect of any such outstanding obligations and
         any obligations of Party B which remain outstanding shall be
         extinguished. Party A further agrees that it shall not take any
         action against the directors, shareholders, administrator or officers
         of Party B to recover any amounts due hereunder (absent fraud or
         willful misconduct by any such person). This clause shall survive the
         termination of this agreement for any reason.

Part 7.  Definitions:

         All capitalized terms used herein and not defined, shall have the
         definition ascribed to them in the Trust Agreement.

         "Rated Indebtedness," means the Certificates issued under the Trust
         Agreement.

         "Securities Intermediary" means U.S. Bank Trust, National Association
         or any successor, acting as Securities Intermediary pursuant to the
         Trust Agreement.

         "Trust Agreement" means that certain STRATS(SM) Certificates Series
         Supplement 2005-3 between Synthetic Fixed-Income Securities, Inc., as
         trustor (the "Trustor") and the Trustee and Securities Intermediary,
         dated as of September 30, 2005, which was entered into pursuant to,
         and as a supplement to, that certain Base Trust Agreement, dated as
         of September 26, 2003 by and between the Trustor and the Trustee.

                                    D-2-13
<PAGE>

         "Trustee" means U.S. Bank Trust, National Association or any
         successor, acting as Trustee pursuant to the Trust Agreement.

                                    D-2-14
<PAGE>

IN WITNESS WHEREOF, the parties have executed this Schedule by their duly
authorized signatories as of the date hereof.

WACHOVIA BANK, NATIONAL ASSOCIATION

By:  __________________________________
     Name:
     Title:

STRATS(SM) TRUST FOR GOLDMAN SACHS CAPITAL I SECURITIES, SERIES 2005-3

By:  U.S. Bank Trust National Association, as Trustee

By:      __________________________________
Name:
Title:

                                    D-2-15
<PAGE>

                                                                   Exhibit D-3

[LOGO OMITTED] WACHOVIA             SWAP TRANSACTION CONFIRMATION
------------------------------------------------------------------------------

Date:                 September 27, 2005
To:                   STRATS (SM) Trust for Goldman Sachs Capital I
                      Securities, Series 2005-3 ("Counterparty")
Address:              U.S. Bank Trust, National Association 100 Wall Street
                      Suite 1600 New York NY 10005 USA
Attention:            Confirmations
From:                 Wachovia Bank, N.A. ("Wachovia")
Ref. No.              1217475

Dear Sir or Madam:

This confirms the terms of the Transaction described below between
Counterparty and Wachovia. The definitions and provisions contained in the
2000 ISDA Definitions, as published by the International Swaps and Derivatives
Association, Inc., are incorporated into this Confirmation. In the event of
any inconsistency between those definitions and provisions and this
Confirmation, this Confirmation will govern. Fixed Amounts and Floating
Amounts for each applicable Payment Date hereunder will be calculated in
accordance with the ISDA Definitions, and if any Fixed Amount and Floating
Amount are due for the same Payment Date hereunder, then those amounts shall
not be payable and instead the Fixed Rate Payer shall pay the positive
difference, if any, between the Fixed Amount and the Floating Amount, and the
Floating Rate Payer shall pay the positive difference, if any, between the
Floating Amount and the Fixed Amount.

1. The terms of the particular Transaction to which the Confirmation relates
are as follows:

Transaction Type:                Interest Rate Swap
Currency for Payments:           U.S. Dollars
Notional Amount:                 USD 40,000,000.00
Term:
   Trade Date:                   August 29, 2005
   Effective Date:               September 30, 2005
   Termination Date:             February 15, 2034

Fixed Amounts:

   Fixed Rate Payer:             Counterparty
   Period End Dates:             Semi-annually on the 15th of each February
                                 and August commencing February 15, 2006,
                                 through and including the Termination Date;
                                 No Adjustment.
   Payment Dates:                Semi-annually on the 15th of each February
                                 and August commencing February 15, 2006,
                                 through and including the Termination Date.

   Business Day Convention:      Following
   Business Day:                 New York
   Fixed Rate:                   6.345%
   Fixed Rate Day Count
   Fraction:                     30/360

                                    D-3-1
<PAGE>

Additional Fixed Amounts:

   Fixed Amount I Payer:         Wachovia
   Fixed Amount I :              USD 1,688,000.00
   Payment Date:                 September 30, 2005

   Fixed Amount II Payer:        Wachovia
   Fixed Amount II :             USD 976,500.00
   Payment Date:                 September 30, 2005

   Fixed Amount III Payer:       Wachovia
   Fixed Amount III :            USD 796,500.00
   Payment Date:                 September 30, 2005

Floating Amounts:

   Floating Rate Payer:          Wachovia
   Period End Dates:             Monthly on the 15th of each month, commencing
                                 October 15, 2005, through and including the
                                 Termination Date; No Adjustment.
   Payment Dates:                Monthly on the 15th of each month, commencing
                                 October 17, 2005, through and including the
                                 Termination Date. Provided, however,
                                 following the occurrence of any Deferral
                                 Period (as defined in the Trust Agreement),
                                 Payment Dates shall automatically change to
                                 be semi-annually on the 15th of each August
                                 and February, commencing on the February 15th
                                 or August 15th occurring on or immediately
                                 after the termination of the applicable
                                 Deferral Period, through and including the
                                 Termination Date.
   Business Day Convention:      Following
   Business Day:                 New York
   Floating Rate for initial
   Calculation Period:           Determined two London Banking Days prior to
                                 the Effective Date.
   Floating Rate Option:         USD-LIBOR-BBA
   Designated Maturity:          6 Months
   Spread:                       Plus 1.00%
   Floating Rate Day Count
   Fraction:                     30/360
   Floating Rate determined:     Two London Banking Days prior to each
                                 Reset Date.
   Reset Dates:                  The first day of each Calculation Period.
   Compounding:                  Inapplicable
   Rounding convention:          5 decimal places per the ISDA Definitions.

Interest Rate Cap:

   Floating Rate Payer:          Counterparty
   Cap Rate:                     8.00%
   Period End Dates:             Monthly on the 15th of each month, commencing
                                 October 15, 2005, through and including the
                                 Termination Date; No Adjustment.
   Payment Dates:                Monthly on the 15th of each month, commencing
                                 October 17, 2005, through and including the
                                 Termination Date. Provided, however,
                                 following the occurrence of any Deferral
                                 Period (as defined in the Trust Agreement),
                                 Payment Dates shall automatically change to
                                 be semi-annually on the 15th of each August
                                 and February, commencing on the February 15th
                                 or August 15th occurring on or immediately
                                 after the termination of the applicable
                                 Deferral Period, through and including the
                                 Termination Date.
   Business Day Convention:      Following
   Business Day:                 New York

                                    D-3-2
<PAGE>

   Floating Rate for initial
   Calculation Period:           Determined two London Banking Days prior to
                                 the Effective Date.
   Floating Rate Option:         USD-LIBOR-BBA
   Designated Maturity:          6 Months
   Spread:                       Plus 1.00%
   Floating Rate Day Count
   Fraction:                     30/360
   Floating Rate determined:     Two London Banking Days prior to each Reset
                                 Date.
   Reset Dates:                  The first day of each Calculation Period.
   Compounding:                  Inapplicable
   Rounding convention:          5 decimal places per the ISDA Definitions.

2. The additional provisions of this Confirmation are as follows:

Calculation Agent:               Wachovia
Payment Instructions:            Wachovia Wholesale Lockbox
                                 P.O. Box 60308
                                 Charlotte, NC 28260-0308
Wachovia Contacts:               Settlements and/or Rate Resets:
                                 Tel: (800)249-3865
                                 Fax: (704)383-9139

                                 Documentation :
                                 Tel: (704)383-4599
                                 Fax: (704)383-9139

                                 Collateral :
                                 Tel: (704)383-9529

                                 Please quote transaction reference number.
Payments to Counterparty:        US Bank
                                 ABA#: 091 000 022
                                 BNF: U.S. Bank Trust N.A.
                                 A/C #: 1801 2116 7365
                                 Attn: Gagendra Haniff 212-361-3824
                                 Ref: STRATS Trust for Goldman Sachs
                                 Series 2005-3  A/C#: 791204000

Additional Terms:

"Trust Agreement" means that certain STRATS(SM) Certificates Series Supplement
2005-3 between Synthetic Fixed-Income Securities, Inc., as trustor (the
"Trustor") and the Trustee and Securities Intermediary dated as of September
30, 2005, which was entered into pursuant to, and as a supplement to, that
certain Base Trust Agreement, dated as of September 26, 2003 by and between
the Trustor and the Trustee.

Miscellaneous:

The parties hereby acknowledge and agree that the Payments hereunder shall be
subject to the Provisions of Part 1(h)(i) of the Schedule to the ISDA Master
Agreement, including, but not limited to the obligation to pay default
interest in connection with any non-payments hereunder due to a Deferral
Period (as defined in the Trust Agreement).

Documentation

This Confirmation supplements, forms part of, and is subject to, the Master
Agreement between Wachovia and Counterparty dated as of September 30, 2005, as
amended and supplemented from time to time (the "ISDA Master Agreement"). All
provisions contained or incorporated by reference in the Master Agreement will
govern this Confirmation except as expressly modified herein.

                                    D-3-3
<PAGE>

Please confirm that the foregoing correctly sets forth the terms of our
agreement by executing a copy of this Confirmation and returning it to us at
fax number (704) 383-9139.

                                   Very truly yours,
                                   Wachovia Bank, N.A.

                                   By:_____________________________
                                   Name:
                                   Title:

                                   Ref. No. 1217475

Accepted and confirmed as of date first above written:
STRATS (SM) Trust for Goldman Sachs Capital I Securities, Series 2005-3

By:_____________________________
Name:
Title:

                                    D-3-4
<PAGE>

                                                                     EXHIBIT E

                   EVIDENCE OF INTEGRATION FOR TAX PURPOSES

                  This information is retained on behalf of each
Certificateholder and is intended to comply with requirements imposed by
Section 1.1275-6(e) of the United States Treasury Regulations.

         (1) The date the qualifying debt instrument was issued or acquired
         (or is expected to be issued or acquired) by the taxpayer and the
         date the Section 1.1275-6 hedge was entered into by the taxpayer.

         The Trust acquired the qualifying debt instrument on September 30,
         2005 and entered into the Section 1.1275-6 hedge on the same date.
         Each Certificateholder simultaneously acquires its interest in the
         qualifying debt instrument and enters into the Section 1.1275-6 hedge
         on the trade date identified in the trade confirmation for the
         purchase of Certificates.

         (2) A description of the qualifying debt instrument and the Section
         1.1275-6 hedge.

         The qualifying debt instrument is $40,000,000 in aggregate principal
         amount of 6.345% Capital Securities due February 15, 2034 issued by
         Goldman Sachs Capital I. The Section 1.1275-6 hedge is a swap
         agreement between the Trust and Wachovia Bank, N.A., as evidenced by
         an ISDA Master Agreement (including a schedule thereto) dated as of
         September 30, 2005 and as supplemented by a confirmation number
         1217475, in the form attached to this series supplement as Exhibit D.

         (3) A summary of the cash flows and accruals resulting from treating
         the qualifying debt instrument and the Section 1.1275-6 hedge as an
         integrated transaction (that is, the cash flows and accruals on the
         synthetic debt instrument).

                  A single principal payment of $40,000,000 is payable on the
maturity date of February 15, 2034. Except during a Deferral Period, interest
payments at the six month LIBOR rate (reset monthly) plus 1.00% per annum (but
no more than 8.00% per annum) (each such interest payment, an "Interest
Payment") is payable on the 15th day of each calendar month (or if the 15th
calendar day is not a business day, on the next succeeding business day).

                  During any Deferral Period, the interest for each Interest
Period will be calculated as described above and will accumulate additional
interest on the amount of each deferred Interest Payment from the Distribution
Date on which it otherwise would have been paid at the Underlying Securities
Interest Rate compounded semi-annually on the basis of a 360-day year
consisting of twelve 30-day months. The amount of the Interest Payment payable
for any partial period will be computed on the basis of the actual number of
days elapsed per 30-day month. Such Interest Payments will resume once (i)
distributions on the Underlying Securities have resumed and (ii) all amounts
due and payable on the Underlying Securities have been received

                                     E-1

<PAGE>

by the Trust and any amounts owed to the Swap Counterparty under the Swap
Agreement have been paid to the Swap Counterparty. Following the satisfaction
of these conditions, Interest Payments, as described above, on the
Certificates will be payable on the next succeeding Underlying Securities
Payment Date once distributions on the Underlying Securities have resumed.
Thereafter, the Interest Payment for each Interest Period during the term of
the Swap Agreement will be payable semi-annually on each February 15 and
August 15 (or the next succeeding business day), until the Certificates have
been retired in an amount obtained by multiplying (i) the Swap Notional Amount
by (ii) the Swap Agreement Rate (reset monthly) plus 1.00% per annum and by
(iii) a fraction the numerator of which is 30 and the denominator of which is
360, subject to a maximum interest rate of 8.00%, meaning that for any
distribution date for which the six month LIBOR rate plus 1.00% per annum is
greater than 8.00%, the Interest Payment on the Swap Agreement will equal
8.00% per annum.

                   For any Interest Period (as hereinafter defined), the six
month LIBOR rate will be, with respect to any LIBOR Determination Date, the
London interbank offered rate for six month (such period being referred to as
the "Designated Maturity") United States dollar deposits, commencing on the
second London Banking Day (as defined below) immediately following such LIBOR
Determination Date, which appears on Telerate Page 3750 (as defined below) as
of 11:00 a.m., London time, on such LIBOR Determination Date. If such rate
does not appear on Telerate Page 3750 at such time, LIBOR for the Designated
Maturity will be determined on the basis of the rates at which deposits in
U.S. Dollars are offered by the Reference Banks (as defined below) at
approximately 11:00 a.m., London time, on the LIBOR Determination Date to
prime banks in the London interbank market for a period of the Designated
Maturity commencing on the first day of the related Interest Period and in an
amount that is representative for a single transaction in such market at the
relevant time. The Calculation Agent will request the principal London office
of each of the Reference Banks to provide a quotation of its rate. If at least
two such quotations are provided, the rate for that Interest Period will be
the arithmetic mean of the quotations. If fewer than two quotations are
provided as requested, the rate for that Interest Period will be the
arithmetic mean of the rates quoted by major banks in New York City, selected
by the Calculation Agent, at approximately 11:00 a.m., New York City time, on
the first day of the related Interest Period for loans in U.S. Dollars to
leading European banks for a period of the Designated Maturity commencing on
the first day of the related Interest Period and in an amount that is
representative for a single transaction in such market at the relevant time.

                  "Interest Period" means, with respect to the first
distribution date, the period from and including the original issue date of
the Certificates to, but excluding, October 15, 2005, and thereafter, so long
as the Swap Agreement is in effect, the period from and including the 15th day
of the preceding calendar month to, but excluding, the 15th day of the current
calendar month.

                  "LIBOR Determination Date" means for each Interest Period,
the second London Banking Day preceding the commencement of such Interest
Period. "London Banking Day" means, any day on which commercial banks are open
for business (including dealings in foreign exchange and foreign currency
deposits) in London. "Reference Banks" means four major banks in the London
interbank market on the related LIBOR Determination Date, as selected by the
Calculation Agent. "Telerate Page 3750" means the display page so designated
on Moneyline's

                                     E-2

<PAGE>

Telerate Service (or such other page as may replace that page on that service,
or such other service as may be nominated as the information vendor, for the
purpose of displaying LIBOR).

                                     E-3CREDIT AGREEMENT

among

PARTNERRE LTD.

VARIOUS DESIGNATED SUBSIDIARY BORROWERS,

VARIOUS LENDING INSTITUTIONS,

and

JPMORGAN CHASE BANK, N.A. (F/K/A  JPMORGAN CHASE BANK),

as ADMINISTRATIVE AGENT,

______________________________________

Dated as of June 17, 2004 and

Amended and Restated as of September 30, 2005

_______________________________________

$700,000,000

 

 

 

J.P. MORGAN SECURITIES INC.,

as SOLE LEAD ARRANGER AND SOLE BOOKRUNNER,

and

WACHOVIA BANK, NATIONAL ASSOCIATION,

as CO-ARRANGER and SYNDICATION AGENT

and

BARCLAYS BANK PLC,

CREDIT SUISSE

 

and

 

HSBC BANK U.S.A.,

as CO-DOCUMENTATION AGENTS

 

 

	
             
 	
             
 	
             
 

 

 

 

 

CREDIT AGREEMENT, dated as of June 17, 2004 and amended and restated as of September 30, 2005, among PARTNERRE LTD., a company organized under the laws of Bermuda (the “Company”) the Designated Subsidiary Borrowers (as hereinafter defined) from time to time party hereto, the lenders from time to time party hereto (each, a “Lender” and, collectively, the “Lenders”) and JPMORGAN CHASE BANK, N.A. (f/k/a JPMorgan Chase Bank) (“JPMorgan Chase”) as Administrative Agent (in such capacity, the “Administrative Agent”).  Unless otherwise defined herein, all capitalized terms used herein and defined in Section 10 are used herein as so defined.

W I T N E S S E T H:

WHEREAS, the Company, certain of the Designated Subsidiary Borrowers, the Existing Lenders and JPMorgan Chase, as Administrative Agent, are parties to a Credit Agreement, dated as of June 17, 2004 (as the same has been amended, modified or supplemented to, but not including, the Restatement Effective Date, the “Existing Credit Agreement”); and

WHEREAS, the parties hereto wish to amend and restate the Existing Credit Agreement in its entirety in the form of this Agreement, subject to and on the terms and conditions set forth herein, and the Lenders are willing to make available to the Company and the Designated Subsidiary Borrowers the credit facilities provided herein;

NOW, THEREFORE, the Company, the Designated Subsidiary Borrowers, the Lenders and the Administrative Agent agree that, on the Restatement Effective Date, the Existing Credit Agreement shall be and is hereby amended and restated in its entirety as follows:

NOW, THEREFORE, IT IS AGREED:

SECTION 1.  Amount and Terms of Credit.

1.01      Commitment.  (a)Subject to and upon the terms and conditions herein set forth, each Lender severally agrees, at any time and from time to time on and after the Restatement Effective Date and prior to the Final Maturity Date, to make a loan or loans (each, a “Revolving Loan” and, collectively, the “Revolving Loans”) to one or more of the Borrowers (on a several basis), which Revolving Loans (i) shall be made and maintained in Dollars; (ii) may be repaid and reborrowed in accordance with the provisions hereof; (iii) except as hereinafter provided, may, at the option of each Borrower, be incurred and maintained as, and/or converted into, Base Rate Loans or Eurodollar Loans, provided that all Revolving Loans made as part of the same Borrowing shall, unless otherwise
specified herein, consist of Revolving Loans of the same Type; and (iv) shall not exceed in aggregate Principal Amount outstanding at any time either (x) the Loan Sublimit at such time or (y) when added to the sum of the aggregate Principal Amount of all Competitive Bid Loans then outstanding and all Letter of Credit Outstandings at such time, the Total Commitment at such time.

(b)        Subject to and upon the terms and conditions herein set forth, each Lender severally agrees that one or more Borrowers may (on a several basis) incur a loan or loans (each, a “Competitive Bid Loan” and, collectively, the “Competitive Bid Loans”) from one or more 

 

 

	
             
 	
             
 	
             
 

 

 

 

Bidder Lenders pursuant to a Competitive Bid Borrowing at any time and from time to time on and after the Restatement Effective Date and prior to the date which is three Business Days preceding the date which is 10 days prior to the Final Maturity Date, provided that after giving effect to any Competitive Bid Borrowing and the use of the proceeds thereof, the aggregate Principal Amount of Competitive Bid Loans outstanding shall not exceed either (x) when added to the aggregate Principal Amount of Revolving Loans then outstanding, the Loan Sublimit at such time or (y) when added to the aggregate Principal Amount of all Revolving Loans then outstanding and the Letter of Credit Outstandings at such time, the Total Commitment at such time. 

1.02      Minimum Borrowing Amounts, etc.  The aggregate Principal Amount of each Borrowing shall not be less than the Minimum Borrowing Amount. More than one Borrowing may be incurred on any day, provided that at no time shall there be outstanding more than 10 Borrowings of Eurodollar Loans.

1.03      Notice of Borrowing of Revolving Loans.  (a)Whenever a Borrower desires to incur Revolving Loans, it shall give the Administrative Agent at its Notice Office, (x) prior to 11:00 A.M. (New York time) at least three Business Days’ prior written notice (or telephonic notice promptly confirmed in writing) of each Borrowing of Eurodollar Loans, and (y) written notice (or telephonic notice promptly confirmed in writing) prior to 10:00 A.M. (New York time) on the date of Borrowing in the case of each Borrowing of Base Rate Loans.  Each such notice (each, a “Notice of Borrowing”) shall be in the form of Exhibit A-1 and shall be irrevocable and shall specify (i) the identity of the applicable Borrower, (ii) the aggregate principal amount of the Revolving Loans to be made pursuant to such Borrowing, (iii) the
date of Borrowing (which shall be a Business Day), (iv) whether the respective Borrowing shall consist of Base Rate Loans or Eurodollar Loans and (v) if such Borrowing consists of Eurodollar Loans, the Interest Period to be initially applicable thereto.  The Administrative Agent shall promptly give each Lender written notice (or telephonic notice promptly confirmed in writing) of each proposed Borrowing, of the portion thereof to be funded by such Lender and of the other matters covered by the Notice of Borrowing.

(b)        Without in any way limiting the obligation of each Borrower to confirm in writing any telephonic notice permitted to be given hereunder, the Administrative Agent may prior to receipt of written confirmation act without liability upon the basis of such telephonic notice, believed by it in good faith to be from an Authorized Officer of such Borrower.  In each such case, each Borrower hereby waives the right to dispute the Administrative Agent’s record of the terms of such telephonic notice absent manifest error.

1.04      Competitive Bid Borrowings.  (a)Whenever a Borrower desires to incur a Competitive Bid Borrowing, it shall deliver to the Administrative Agent, prior to 11:00 A.M. (New York time) (x) at least four Business Days prior to the date of such proposed Competitive Bid Borrowing, in the case of a Spread Borrowing, and (y) at least one Business Day prior to the date of such proposed Competitive Bid Borrowing, in the case of an Absolute Rate Borrowing which is Dollar-denominated and at least three Business Days prior to the date of such proposed Competitive Bid Borrowing, in the case of Absolute Rate Borrowing which is an Alternate Currency Loan, a written notice substantially in the form of Exhibit A-2 hereto (a “Notice of Competitive Bid Borrowing”), which notice shall specify in each case (i) the identity of the 

 

 

	
             
 	
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applicable Borrower, (ii) the date (which shall be a Business Day) and the aggregate amount of the proposed Competitive Bid Borrowing, (iii) the maturity date for repayment of each and every Competitive Bid Loan to be made as part of such Competitive Bid Borrowing (which maturity date may be (A) up to six months after the date of such Competitive Bid Borrowing in the case of a Spread Borrowing and (B) no fewer than seven days and no more than 180 days after the date of such Competitive Bid Borrowing in the case of an Absolute Rate Borrowing, provided that in no event shall the maturity date of any Competitive Bid Borrowing be later than the tenth Business Day preceding the Final Maturity Date), (iv) the interest payment date or dates relating thereto, (v) whether the proposed Competitive Bid Borrowing is to be an Absolute Rate Borrowing or a Spread Borrowing,
(vi) in the case of an Alternate Currency Loan, the Alternate Currency for such Competitive Bid Borrowing, and (vii) any other terms to be applicable to such Competitive Bid Borrowing.  The Administrative Agent shall promptly notify each Bidder Lender by telephone or facsimile of each such request for a Competitive Bid Borrowing received by it from a Borrower and of the contents of the related Notice of Competitive Bid Borrowing.

(b)        Each Bidder Lender shall, if, in its sole discretion, it elects to do so, irrevocably offer to make one or more Competitive Bid Loans to the applicable Borrower as part of such proposed Competitive Bid Borrowing at a rate or rates of interest specified by such Bidder Lender in its sole discretion and determined by such Bidder Lender independently of each other Bidder Lender, by notifying the Administrative Agent (which shall give prompt notice thereof to such Borrower by facsimile), before 9:30 A.M. (New York time) on the date (the “Reply Date”) which is (x) in the case of an Absolute Rate Borrowing which is Dollar-denominated, the date of such proposed Competitive Bid Borrowing and in the case of an Absolute Rate Borrowing which is an Alternate Currency Loan, two Business Days before the date of such Competitive Bid Borrowing
or (y) in the case of a Spread Borrowing, three Business Days before the date of such proposed Competitive Bid Borrowing, of the minimum amount and maximum amount of each Competitive Bid Loan which such Bidder Lender would be willing to make as part of such proposed Competitive Bid Borrowing (which amounts may, subject to the proviso contained in Section 1.01(b), exceed such Bidder Lender’s Commitment), the rate or rates of interest therefor and such Bidder Lender’s lending office with respect to such Competitive Bid Loan; provided that if the Administrative Agent in its capacity as a Bidder Lender shall, in its sole discretion, elect to make any such offer, it shall notify the respective Borrower of such offer before 9:15 A.M. (New York time) on the Reply Date.  If any Bidder Lender shall elect not to make such an offer, such Bidder Lender shall so notify the Administrative Agent, before 9:30 A.M. (New York time) on the Reply
Date, and such Bidder Lender shall not be obligated to, and shall not, make any Competitive Bid Loan as part of such Competitive Bid Borrowing; provided that the failure by any Bidder Lender to give such notice shall not cause such Bidder Lender to be obligated to make any Competitive Bid Loan as part of such proposed Competitive Bid Borrowing.

(c)        The applicable Borrower shall, in turn, before 10:30 A.M. (New York time) on the Reply Date, either:

(i)         cancel such Competitive Bid Borrowing by giving the Administrative Agent notice to such effect (it being understood and agreed that if such Borrower gives no such notice of cancellation and no notice of acceptance pursuant to clause (ii) below, then such Borrower shall be deemed to have canceled such Competitive Bid Borrowing), or

 

 

	
             
 	
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(ii)         accept one or more of the offers made by any Bidder Lender or Bidder Lenders pursuant to clause (b) above by giving notice (in writing or by telephone confirmed in writing) to the Administrative Agent of the amount of each Competitive Bid Loan (which amount shall be equal to or greater than the minimum amount, and equal to or less than the maximum amount, notified to the applicable Borrower by the Administrative Agent on behalf of such Bidder Lender for such Competitive Bid Borrowing pursuant to clause (b) above) to be made by each Bidder Lender as part of such Competitive Bid Borrowing, and reject any remaining offers made by Bidder Lenders pursuant to clause (b) above by giving the Administrative Agent notice to that effect; provided that the acceptance of
offers may only be made on the basis of ascending Absolute Rates (in the case of an Absolute Rate Borrowing) or Spreads (in the case of a Spread Borrowing), in each case commencing with the lowest rate so offered; provided further, however, that if offers are made by two or more Bidder Lenders at the same rate and acceptance of all such equal offers would result in a greater principal amount of Competitive Bid Loans being accepted than the aggregate principal amount requested by the applicable Borrower, if such Borrower elects to accept any such offers such Borrower shall accept such offers pro rata from such Bidder Lenders (on the basis of the maximum amounts of such offers) unless any such Bidder Lender’s pro rata share would be less than the minimum amount specified by such Bidder Lender in its offer, in which case such Borrower shall have the right to accept one or more such equal offers in their entirety and reject the other equal offer or offers or to allocate acceptance among all such equal offers (but giving effect to the minimum and maximum amounts specified for each such offer pursuant to clause (b) above), as such Borrower may elect in its sole discretion.

(d)        If any Competitive Bid Borrowing is cancelled or deemed cancelled pursuant to clause (c)(i) above, the Administrative Agent shall give prompt notice thereof to the Bidder Lenders and such Competitive Bid Borrowing shall not be made.

(e)        If the applicable Borrower accepts one or more of the offers made by any Bidder Lender or Bidder Lenders pursuant to clause (c)(ii) above, the Administrative Agent shall in turn promptly notify (x) each Bidder Lender that has made an offer as described in clause (b) above, of the date and aggregate amount of such Competitive Bid Borrowing and whether or not any offer or offers made by such Bidder Lender pursuant to clause (b) above have been accepted by the Borrower and (y) each Bidder Lender that is to make a Competitive Bid Loan as part of such Competitive Bid Borrowing, of the amount of each Competitive Bid Loan to be made by such Bidder Lender as part of such Competitive Bid Borrowing.

1.05      Disbursement of Funds.  (a)No later than 12:00 Noon (New York time) (or (i) 1:00 P.M. (New York time) in the case of a Borrowing of Base Rate Loans for which the applicable Notice of Borrowing was given on the date of borrowing and (ii) 3:00 P.M. (New York time) in the case of a Competitive Bid Borrowing) on the date specified in each Notice of Borrowing or Notice of Competitive Bid Borrowing, each Lender will make available its pro rata share, if any, of such Borrowing requested to be made on such date.  All such amounts shall be made available to the Administrative Agent in the relevant Approved Currency, as the case may be, and immediately available funds at the Payment Office and the Administrative Agent promptly will make
available to the applicable Borrower by depositing to the account designated by such Borrower, which account shall be at an institution in the same city as the respective 

 

 

	
             
 	
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Payment Office, the aggregate of the amounts so made available in the type of funds received. Unless the Administrative Agent shall have been notified by any Lender participating in a Borrowing prior to the date of such Borrowing that such Lender does not intend to make available to the Administrative Agent its portion of the Borrowing or Borrowings to be made on such date, the Administrative Agent may assume that such Lender has made such amount available to the Administrative Agent on such date of Borrowing, and the Administrative Agent, in reliance upon such assumption, may (in its sole discretion and without any obligation to do so) make available to the applicable Borrower a corresponding amount. If such corresponding amount is not in fact made available to the Administrative Agent by such Lender and the Administrative Agent has made available same to the applicable Borrower, the Administrative
Agent shall be entitled to recover such corresponding amount from such Lender.  If such Lender does not pay such corresponding amount forthwith upon the Administrative Agent’s demand therefor, the Administrative Agent shall promptly notify the applicable Borrower, and such Borrower shall pay such corresponding amount to the Administrative Agent within three Business Days of receipt of such notice unless previously paid by such Lender.  The Administrative Agent shall also be entitled to recover on demand from such Lender or such Borrower, as the case may be, interest on such corresponding amount in respect of each day from the date such corresponding amount was made available by the Administrative Agent to such Borrower to the date such corresponding amount is recovered by the Administrative Agent, at a rate per annum equal to (x) if paid by such Lender, the overnight Federal Funds Effective Rate or (y) if paid by such Borrower, the then applicable rate of interest,
calculated in accordance with Section 1.09, for the respective Loans.

(b)        Nothing herein shall be deemed to relieve any Lender from its obligation to fulfill its commitments hereunder or to prejudice any rights which each Borrower may have against any Lender as a result of any default by such Lender hereunder.

1.06      Notes.  (a)To the extent requested by a Lender, each Borrower’s obligation to pay the principal of, and interest on, the Loans made to it by each Lender shall be evidenced (i) if Revolving Loans, by a promissory note substantially in the form of Exhibit B-1 with blanks appropriately completed (each, a “Revolving Note” and, collectively, the “Revolving Notes”) and (ii) if Competitive Bid Loans, by a promissory note substantially in the form of Exhibit B-2 with blanks appropriately completed (each a “Competitive Bid Note” and, collectively, the “Competitive Bid Notes”). Each Irish Designated Subsidiary Borrower shall pay any and all applicable stamp taxes or duties payable in connection with any Notes issued by it.

(b)        Each Lender will note on its internal records the amount of each Loan made by it and each payment in respect thereof and will, prior to any transfer of any of its Notes, endorse on the reverse side thereof the outstanding Principal Amount of Loans evidenced thereby.  Failure to make any such notation shall not affect a Borrower’s obligations in respect of such Loans.

1.07      Conversions.  Each Borrower shall have the option to convert on any Business Day all or a portion at least equal to the applicable Minimum Borrowing Amount of its Revolving Loans constituting Base Rate Loans or Eurodollar Loans into a Borrowing or Borrowings of Revolving Loans constituting Eurodollar Loans or Base Rate Loans, respectively, provided that (i) no partial conversion shall reduce the outstanding principal amount of the 

 

 

	
             
 	
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Eurodollar Loans made pursuant to a Borrowing to less than the Minimum Borrowing Amount applicable thereto, (ii) Base Rate Loans may not be converted into Eurodollar Loans when a Default or Event of Default is then in existence if the Administrative Agent or the Required Lenders shall have determined in its or their sole discretion not to permit such conversion and (iii) Borrowings of Eurodollar Loans resulting from this Section 1.07 shall be limited in number as provided in Section 1.02.  Each such conversion shall be effected by the respective Borrower giving the Administrative Agent at the Notice Office, prior to 12:00 Noon (New York time), at least three Business Days’ (or one Business Day in the case of a conversion into Base Rate Loans) prior written notice (or telephonic notice promptly confirmed in writing) (each, a “Notice of Conversion”) specifying the Revolving Loans to be so
converted, the Type of Loans (as to interest option) to be converted into and, if to be converted into a Borrowing of Eurodollar Loans, the Interest Period to be initially applicable thereto.  The Administrative Agent shall give each Lender prompt notice of any such proposed conversion affecting any of its Loans.

1.08      Pro Rata Borrowings, etc.  All Revolving Loans incurred pursuant to a Borrowing shall be made by the Lenders pro rata on the basis of their respective Commitments.  It is understood that no Lender shall be responsible for any default by any other Lender in its obligation to make Revolving Loans hereunder, and that each Lender shall be obligated to make the Revolving Loans provided to be made by it hereunder, regardless of the failure of any other Lender to fulfill its commitments hereunder and regardless of whether such Lender has made any Competitive Bid Loans hereunder.

1.09      Interest.  (a)The unpaid principal amount of each Base Rate Loan shall bear interest from the date of the Borrowing thereof until maturity (whether by acceleration or otherwise) or conversion at a rate per annum which shall at all times be equal to the sum of the Base Rate plus the Applicable Margin each as in effect from time to time.

(b)        The unpaid principal amount of each Eurodollar Loan shall bear interest from the date of the Borrowing thereof until maturity (whether by acceleration or otherwise) or conversion at a rate per annum which shall at all times during each Interest Period applicable thereto be equal to the sum of LIBOR for such Interest Period plus the Applicable Margin.

(c)        The unpaid principal amount of each Competitive Bid Loan shall bear interest from the date of the Borrowing thereof until maturity (whether by acceleration or otherwise) at a rate or rates per annum specified by a Bidder Lender or Bidder Lenders, as the case may be, pursuant to Section 1.04(b) and accepted by the respective Borrower pursuant to Section 1.04(c).

(d)        All overdue principal and, to the extent permitted by law, overdue interest in respect of any Loans shall be payable on demand and shall bear interest at the Base Rate in effect from time to time plus 2%, provided that principal in respect of Eurodollar Loans and Competitive Bid Loans shall bear interest from the date same becomes due (whether by acceleration or otherwise) until the end of the Interest Period applicable thereto at a rate per annum equal to 2% plus the rate of interest applicable on the due date therefor.

(e)        Interest shall accrue from and including the date of any Borrowing to but excluding the date of any repayment thereof, and shall be payable (i) in respect of each Base 

 

 

	
             
 	
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Rate Loan, quarterly in arrears on the last Business Day of each calendar quarter, (ii) in respect of each Eurodollar Loan, on the last day of each Interest Period applicable thereto and, in the case of an Interest Period in excess of three months, on each date occurring at three month intervals after the first day of such Interest Period, (iii) in respect of each Competitive Bid Loan, at such times as specified in the Notice of Competitive Bid Borrowing relating thereto, and (iv) in respect of each Loan, on any prepayment or conversion (other than the prepayment or conversion of any Base Rate Loan) (on the amount prepaid or converted), at maturity (whether by acceleration or otherwise) and, after such maturity, on demand.  

(f)         All computations of interest hereunder shall be made in accordance with Section 12.07(b).

(g)        The Administrative Agent, upon determining the interest rate for any Borrowing for any Interest Period, shall promptly notify the applicable Borrower and the Lenders thereof.

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

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

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

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

(iv)        no Interest Period may be elected that would extend beyond the Final Maturity Date;

 

 

	
             
 	
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(v)        at any time when a Default or an Event of Default is then in existence no Interest Period may be elected if the Administrative Agent or the Required Lenders shall have determined in its or their sole discretion not to permit such election; and 

(vi)        all Eurodollar Loans comprising a Borrowing shall at all times have the same Interest Period.

(b)        If upon the expiration of any Interest Period, the applicable Borrower has failed to (or may not) elect a new Interest Period to be applicable to the Loans subject to the expiring Interest Period as provided above, such Borrower shall be deemed to have elected, in the case of Eurodollar Loans, to convert such Borrowing into a Borrowing of Base Rate Loans effective as of the expiration date of such current Interest Period.

1.11      Increased Costs, Illegality, etc.  (a)In the event that (x) in the case of clause (i) or (iv) below, the Administrative Agent or (y) in the case of clause (ii) or (iii) below, any Lender shall have determined (which determination shall, absent manifest error, be final and conclusive and binding upon all parties hereto):

(i)         on any date for determining LIBOR for any Interest Period that, by reason of any changes arising after the date of this Agreement affecting the relevant interbank market, adequate and fair means do not exist for ascertaining the applicable interest rate on the basis provided for in the definition of LIBOR; 

(ii)         at any time, that such Lender shall actually incur increased costs or reductions in the amounts received or receivable hereunder with respect to any Eurodollar Loans or Competitive Bid Loans (other than any increased cost or reduction in the amount received or receivable resulting from the imposition of or a change in the rate of taxes or similar charges) because of any change since the Restatement Effective Date (or, in the case of any Competitive Bid Loan, since the making of such Competitive Bid Loan) in any applicable law, governmental rule, regulation, guideline or order (or in the interpretation or administration thereof and including the introduction of any new law or governmental rule, regulation, guideline or order) (such as, for example, but not limited to, a change in official reserve
requirements, but, in all events, excluding amounts payable pursuant to Section 1.11(c), 1.11(d) or 1.11(e));

(iii)        at any time, that the making or continuance of any Eurodollar Loans or Competitive Bid Loans has become unlawful by compliance by such Lender in good faith with any law, governmental rule, regulation or guideline, or has become impracticable as a result of a contingency occurring after the Restatement Effective Date which adversely affects the relevant interbank market; or

(iv)        at any time that any Alternate Currency is not available in sufficient amounts, as determined in good faith by the Administrative Agent, to fund any Borrowing of Loans denominated in such Alternate Currency;

then, and in any such event, such Lender (or the Administrative Agent in the case of clause (i) or (iv) above) shall (x) on such date and (y) within ten Business Days of the date on which such event no longer exists give notice (by telephone confirmed in writing) to the respective Borrower 

 

 

	
             
 	
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and, except in the case of clause (i) or (iv) above, to the Administrative Agent of such determination (which notice the Administrative Agent shall promptly transmit to each of the other Lenders).  Thereafter, and for so long as the applicable circumstance continues to exist, (w) in the case of clause (i) above, Eurodollar Loans (and Competitive Bid Loans constituting a Spread Borrowing priced by reference to LIBOR) shall no longer be available until such time as the Administrative Agent notifies the respective Borrower and the Lenders that the circumstances giving rise to such notice by the Administrative Agent no longer exist in accordance with clause (y) of the preceding sentence, and any Notice of Borrowing, Notice of Competitive Bid Borrowing or Notice of Conversion given by a Borrower with respect to such Loans which have not yet been incurred shall be deemed rescinded by the relevant Borrower,
(x) in the case of clause (ii) above, the applicable Borrower shall pay to such Lender, upon written demand therefor, such additional amounts (in the form of an increased rate of, or a different method of calculating, interest or otherwise as such Lender in its sole discretion shall determine) as shall be required to compensate such Lender for such increased costs or reductions in amounts receivable hereunder (a written notice as to the additional amounts owed to such Lender, showing the basis for the calculation thereof in reasonable detail, submitted to the applicable Borrower by such Lender shall, absent manifest error, be final and conclusive and binding upon all parties hereto), (y) in the case of clause (iii) above, the applicable Borrower shall take one of the actions specified in Section 1.11(b) as promptly as possible and, in any event, within the time period required by law and (z) in the case of clause (iv) above, Loans in the affected Alternate Currency shall no longer
be available until such time as the Administrative Agent notifies the respective Borrower and the Lenders that the circumstances giving rise to such notice by the Administrative Agent no longer exist in accordance with clause (y) of the preceding sentence, and any Notice of Borrowing, Notice of Competitive Bid Borrowing or Notice of Conversion given by a Borrower with respect to such Alternate Currency Loans which have not yet been incurred shall be deemed rescinded by such Borrower.

(b)        At any time when any Eurodollar Loan or Competitive Bid Loan is affected by the circumstances described in Section 1.11(a)(ii) or (iii), the applicable Borrower may (and in the case of a Eurodollar Loan or Competitive Bid Loan affected pursuant to Section 1.11(a)(iii), the applicable Borrower shall) either (i) if the affected Eurodollar Loan or Competitive Bid Loan is then being made pursuant to a Borrowing, cancel said Borrowing by giving the Administrative Agent telephonic notice (confirmed promptly in writing) thereof on the same date that the respective Borrower was notified by a Lender pursuant to Section 1.11(a)(ii) or (iii), or (ii) if the affected Eurodollar Loan or Competitive Bid Loan is then outstanding, upon at least three Business Days’ notice to the Administrative Agent, (A) in the case of a Eurodollar Loan, require
the affected Lender to convert each such Eurodollar Loan into a Base Rate Loan, and (B) in the case of a Competitive Bid Loan, repay all such Competitive Bid Loans in full, provided that if more than one Lender is affected at any time, then all affected Lenders must be treated the same pursuant to this Section 1.11(b).

(c)        If any Lender shall have determined that after the Restatement Effective Date, the adoption or effectiveness of any applicable law, rule or regulation regarding capital adequacy, or any change therein, or any change in the interpretation or administration thereof by any governmental authority, central bank or comparable agency charged with the interpretation or administration thereof, or compliance by such Lender or any corporation controlling such Lender with any request or directive regarding capital adequacy (whether or not having the force 

 

 

	
             
 	
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of law) of any such authority, central bank or comparable agency, has or would have the effect of reducing the rate of return on such Lender’s or such corporation’s capital or assets as a consequence of its commitments or obligations hereunder to a level below that which such Lender or such other corporation could have achieved but for such adoption, effectiveness, change or compliance (taking into consideration such Lender’s or such other corporation’s policies with respect to capital adequacy), then from time to time, within 10 days after written demand by such Lender (with a copy to the Administrative Agent), the Borrowers jointly and severally agree to pay to such Lender such additional amount or amounts as will compensate such Lender or such other corporation for such reduction.  In determining such additional amounts, each Lender will act reasonably and in good faith and
will use averaging and attribution methods that are commercially reasonable.  Each Lender, upon so determining that any additional amounts will be payable pursuant to this Section 1.11(c), will give prompt written notice thereof to the Borrowers, which notice shall set forth in reasonable detail the basis of the calculation of such additional amounts, although the failure to give any such notice shall not release or diminish each Borrower’s obligations to pay additional amounts pursuant to this Section 1.11(c) upon the subsequent receipt of such notice.

(d)        In the event that any Lender shall in good faith determine (which determination shall, absent manifest error, be final and conclusive and binding on all parties hereto) at any time that such Lender is required to maintain reserves (including, without limitation, any marginal, emergency, supplemental, special or other reserves required by applicable law) which have been established by any Federal, state, local or foreign court or governmental agency, authority, instrumentality or regulatory body with jurisdiction over such Lender (including any branch, Affiliate or funding office thereof) in respect of any Loans or any category of liabilities which includes deposits by reference to which the interest rate on any Loan is determined or any category of extensions of credit or other assets which includes loans by a non-United States
office of any Lender to non-United States residents, then, unless such reserves are included in Section 1.11(a)(ii), 1.11(c) or 1.11(e), such Lender shall promptly notify the Borrowers in writing specifying the additional amounts required to indemnify such Lender against the cost of maintaining such reserves (such written notice to provide in reasonable detail a computation of such additional amounts) and each Borrower shall, and shall be obligated to, pay to such Lender such specified amounts as additional interest at the time that such Borrower is otherwise required to pay interest in respect of such Loan or, if later, on written demand therefor by such Lender.

(e)        In the event that any Lender shall in good faith determine (which determination shall, absent manifest error, be final and conclusive and binding on all parties hereto) at any time that such Lender has incurred Additional Costs in respect of any Loans then, unless such Additional Costs are included in Section 1.11(a)(ii) or 1.11(c) or 1.11(d) such Lender shall promptly notify the Borrowers and the Administrative Agent in writing specifying the additional amounts required to indemnify such Lender against such Additional Costs (such written notice to provide in reasonable detail a computation of such additional amounts) and each Borrower shall, and shall be obligated to, pay to such Lender such specified amounts as additional interest at the time that such Borrower is otherwise required to pay interest in respect of such Loan or, if later,
on written demand therefor by such Lender.

 

 

	
             
 	
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(f)         The Borrowers shall not be obligated to pay any additional amounts arising pursuant to Sections 1.11(a)(ii), 1.11(c), 1.11(d) or 1.11(e) that are attributable to the Excluded Period with respect to such additional amount; provided, that if an applicable law, rule, regulation, guideline or request shall be adopted or made on any date and shall be applicable to the period prior to the date on which such law, rule, regulation, guideline or request is adopted or made (a “Retroactive Period”), the limitation on each Borrower’s obligations to pay such additional amounts hereunder shall not apply to the additional amounts payable in respect of such period.

1.12      Compensation.  Each Borrower shall compensate each Lender, upon its written request (which request shall set forth the basis for requesting such compensation), for all reasonable losses, expenses and liabilities (including, without limitation, any loss, expense or liability incurred by reason of the liquidation or reemployment of deposits or other funds required by such Lender to fund any Eurodollar Loans or Competitive Bid Loans made, or to be made, by it to such Borrower but excluding in any event the loss of anticipated profits) which such Lender may actually sustain:  (i) if for any reason (other than a default by such Lender or the Administrative Agent) a Borrowing of Eurodollar Loans or Competitive Bid Loans does not occur on a date specified therefor in a Notice of Borrowing, a Notice of Competitive Bid Borrowing or a
Notice of Conversion, given by such Borrower (whether or not withdrawn by such Borrower or deemed withdrawn pursuant to Section 1.11(a)); (ii) if any prepayment, repayment or conversion of any such Eurodollar Loans or Competitive Bid Loans occurs on a date which is not the last day of an Interest Period applicable thereto; (iii) if any prepayment of any such Eurodollar Loans or Competitive Bid Loans is not made on any date specified in a notice of prepayment given by such Borrower; (iv) if such Lender is required pursuant to Section 1.14 to assign any such Eurodollar Loans or Competitive Bid Loans as of a date which is not the last day of an Interest Period applicable thereto; or (v) as a consequence of (x) any other default by such Borrower to repay its Eurodollar Loans or Competitive Bid Loans when required by the terms of this Agreement or (y) an election made pursuant to Section 1.11(b).

1.13      Change of Lending Office.  Each Lender agrees that, upon the occurrence of any event giving rise to the operation of Section 1.11(a)(ii), (iii) or (iv) 1.11(c), 1.11(d), 2.06 or 4.04 with respect to such Lender, it will, if requested by the applicable Borrower, use commercially reasonable efforts (subject to overall policy considerations of such Lender) to designate another lending office for any Loans or Commitments affected by such event, provided that such designation is made on such terms that such Lender and its lending office suffer no economic, legal or regulatory disadvantage, with the object of avoiding or materially mitigating the consequence of the event giving rise to the operation of any such Section. Nothing in this Section 1.13 shall affect or postpone
any of the obligations of each Borrower or the right of any Lender provided in Section 1.11 or 4.04.

1.14      Replacement of Lenders.  (a)Upon the occurrence of any event giving rise to the operation of Section 1.11(a)(ii) or (iii), Section 1.11(c), Section 1.11(d), Section 2.06 or Section 4.04 with respect to any Lender which results in such Lender charging to each Borrower increased costs in excess of those being generally charged by the other Lenders, (b) if a Lender becomes a Defaulting Lender, and/or (c) in the case of a refusal by a Lender to consent to a proposed change, waiver, discharge or termination with respect to this Agreement which has been approved by the Required Lenders, the Company shall have the right, if no Default or Event 

 

 

	
             
 	
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of Default then exists, to replace such Lender (the “Replaced Lender”), upon prior written notice to the Administrative Agent and such Replaced Lender, with one or more Person or Persons, none of whom shall be a Defaulting Lender at the time of such replacement (collectively, the “Replacement Lender”) reasonably acceptable to the Administrative Agent, provided that (i) at the time of any replacement pursuant to this Section 1.14, the Replacement Lender and the Replaced Lender shall enter into one or more Assignment Agreements pursuant to Section 12.04(b) (and with all fees payable pursuant to said Section 12.04(b) to be paid by the Replacement Lender) pursuant to which the Replacement Lender shall acquire all of the Commitments and outstanding Loans of the Replaced Lender and, in connection therewith, shall pay to the Replaced Lender in
respect thereof an amount equal to the sum of (A) an amount equal to the principal amount of, and all accrued but unpaid interest on, all outstanding Loans of the Replaced Lender, (B) an amount equal to all Unpaid Drawings that have been funded by (and not reimbursed to) such Replaced Lender, together with all then unpaid interest with respect thereto at such time and (C) an amount equal to all accrued, but theretofore unpaid, Fees owing to the Replaced Lender pursuant to Section 3.01; (ii) all obligations of the Borrowers under the Credit Documents owing to the Replaced Lender (other than those specifically described in clause (i) above in respect of which the assignment purchase price has been, or is concurrently being, paid), including without limitation all amounts owing to the Replaced Lender under Section 1.12 as a result of the assignment of its Loans under clause (i) above, shall be paid in full to such Replaced Lender concurrently with such replacement; and (iii) no
assignment pursuant to this Section 1.14 shall be effective until all of the then outstanding Several Letters of Credit are returned by each respective beneficiary to the Issuing Agent for cancellation in exchange for new or amended Several Letters of Credit which give effect to such assignment (it being understood that to the extent the respective beneficiaries do not consent to such assignment, such assignment cannot occur).  Upon the execution of the respective Assignment Agreements, the payment of amounts referred to in clauses (i) and (ii) above and the return, cancellation and exchange of each then outstanding Several Letter of Credit as provided above and, if so requested by the Replacement Lender, delivery to the Replacement Lender of the appropriate Note or Notes executed by the relevant Borrowers, the Replacement Lender shall become a Lender hereunder and the Replaced Lender shall cease to constitute a Lender hereunder, except with respect to indemnification provisions
applicable to the Replaced Lender under this Agreement, which shall survive as to such Replaced Lender.  

1.15      Designated Subsidiary Borrowers.  The Company may from time to time designate one or more Persons as an additional Designated Subsidiary Borrower, subject to the following terms and conditions:

	
            (a)
 	
            each such Person shall be a 90%-Owned Subsidiary of the Company;
 
	
            (b)
 	
            each such Person shall be a Material Subsidiary;
 	
             

(c)        each such Designated Subsidiary Borrower shall enter into an appropriately completed DSB Assumption Agreement in the form of Exhibit G hereto on or prior to the date of designation hereof.

 

 

	
             
 	
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(d)        on or prior to the date of designation, such 90%-Owned Subsidiary shall execute and deliver to each Lender a Revolving Note and a Competitive Bid Note to evidence the Loans to be incurred by such Person;

(e)        on or prior to the date of designation, the Administrative Agent shall have received from such Person a certificate, signed by an Authorized Officer of such Person in the form of Exhibit E with appropriate insertions or deletions, together with (x) copies of its certificate of incorporation, by laws or other organizational documents and (y) the resolutions relating to the Credit Documents which shall be satisfactory to the Administrative Agent; and 

(f)         on or prior to the date of designation, the Administrative Agent shall have received an opinion, addressed to the Administrative Agent and each of the Lenders and dated the date of designation, from counsel to such Person which opinion shall be substantially in the form of Exhibit H hereto.

1.16      Additional Commitments.  (a) The Company shall have the right, at any time and from time to time, after the Restatement Effective Date and prior to the Final Maturity Date to request (so long as no Default or Event of Default is then in existence or would result therefrom) on one or more occasions that one or more existing Lenders provide Additional Commitments; it being understood and agreed, however, that (i) no existing Lender shall be obligated to provide an Additional Commitment as a result of any request by the Company unless it agrees in its sole discretion to do so, (ii) until such time, if any, as (x) such existing Lender has agreed in its sole discretion to provide an Additional Commitment and executed and delivered to the Administrative Agent an Additional Commitment Agreement in respect thereof as provided in Section 1.16(b)
and (y) such other conditions set forth in Section 1.16(b) shall have been satisfied, such existing Lender shall not be obligated to make Loans or issue, or participate in, Letters of Credit, in excess of the amounts provided for herein, immediately before giving effect to such Additional Commitments provided by such existing Lender pursuant to this Section 1.16, (iii) any existing Lender may provide an Additional Commitment without the consent of any other Lender, (iv) the aggregate amount of Additional Commitments provided pursuant to this Section 1.16 shall not exceed $300,000,000, with up to the full amount of the Commitment available to be used for Letters of Credit and up to half of the Commitment available to be used for Loans, (v) all up-front fees payable to any Additional Commitment Lender shall be as set forth in the relevant Additional Commitment Agreement, (vi) if, on or after the tenth Business Day following the request by the Company of the then existing Lenders to
provide Additional Commitments pursuant to this Section 1.16 on the terms to be applicable thereto, the Company has not received Additional Commitments in an aggregate amount equal to that amount of the Additional Commitments which the Company desires to obtain pursuant to such request (as set forth in the request provided by the Company to the Administrative Agent as provided above), then the Company may request Additional Commitments from Persons which are reasonably acceptable to the Administrative Agent and each Fronting Lender in an aggregate amount equal to such deficiency on terms which are no more favorable in any respect than the terms offered to the existing Lenders, (vii) all Additional Commitments provided on a given date pursuant to this Section 1.16 shall have the same terms and conditions as all then existing Commitments and shall be added to such existing Commitments in accordance with clause (b) of this Section 1.16 below and (viii) all actions taken by the Borrower
pursuant to this Section 1.16 shall be done in coordination with the Administrative Agent.

 

 

	
             
 	
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(b)        At the time of any provision of Additional Commitments pursuant to this Section 1.16, (i) the Company, each Designated Subsidiary Borrower, the Administrative Agent and each existing Lender which agrees to provide an Additional Commitment (each, an “Additional Commitment Lender”) shall execute and deliver to the Administrative Agent an Additional Commitment Agreement substantially in the form of Exhibit L, subject to such modifications in form and substance reasonably satisfactory to the Administrative Agent as may be necessary or appropriate (with the effectiveness of such Additional Commitment Lender’s Additional Commitment to occur upon delivery of such Additional Commitment Agreement to the Administrative Agent, the payment of any fees required in connection therewith and the satisfaction of the other conditions set
forth in this Section 1.16 to the reasonable satisfaction of the Administrative Agent), (ii) if such Additional Commitment Lender is not a United States person (as such term is defined in Section 7701(a)(30) of the Code) for U.S. Federal income tax purpose or would otherwise constitute a Foreign Lender, such Additional Commitment Lender shall provide to the Company the appropriate Internal Revenue Service documentation described in Section 4.04(b), (iii) the Company and each Designated Subsidiary Borrower shall deliver to the Administrative Agent resolutions authorizing the incurrence of the Obligations to be incurred pursuant to each Additional Commitment, together with evidence of good standing of the Company and each Designated Subsidiary Borrower and (iv) the Company and each Designated Subsidiary Borrower shall deliver to the Administrative Agent an opinion, in form and substance reasonably satisfactory to the Administrative Agent, from counsel to the Company and such Designated
Subsidiary Borrower reasonably satisfactory to the Administrative Agent and dated such date, covering such matters similar to those set forth in the opinions of counsel delivered to the Lenders on the Restatement Effective Date pursuant to Section 5.01(e) and such other matters as the Administrative Agent may reasonably request.  The Administrative Agent shall promptly notify each Lender as to the occurrence of each Additional Commitment Date, and (x) on each such date, the Total Commitment under, and for all purposes of, this Agreement and each other Credit Document shall be increased by the aggregate amount of such Additional Commitments and (y) on each such date, Annex I shall be deemed modified to reflect the revised Commitments of each affected Lender.  Notwithstanding anything to the contrary contained in this Agreement, in connection with any increase in the Total Commitment pursuant to this Section 1.16, the Company shall, in coordination with the Administrative Agent and the
Lenders repay outstanding Revolving Loans of certain Lenders and, if necessary, incur additional Revolving Loans from other Lenders, in each case so that such Lenders participate in each Borrowing of such Revolving Loans pro rata on the basis of their Commitments (after giving effect to any increase thereof). 

(c)It is hereby agreed and acknowledged that any Several Letters of Credit in existence on an Additional Commitment Date (the “Specified Several Letters of Credit”) shall be deemed issued under this Agreement as a “Specified Several Letter of Credit” on such Additional Commitment Date.  As soon as possible following each Additional Commitment Date, each Specified Several Letter of Credit shall be amended to replace each Lender party hereto immediately prior to such Additional Commitment Date (each such Lender, a “Pre-existing Lender”) with each Lender party to this Agreement as of such Additional Commitment Date in accordance with each such Lender’s modified Percentage.  Until a Specified Several Letter of Credit has been amended in accordance with this Section 1.16 each Pre-existing Lender shall be deemed to have sold and transferred to each Lender, and
each such Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Pre-existing 

 

 

	
             
 	
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Lender, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Percentage, in such Specified Several Letter of Credit, each substitute Specified Several Letter of Credit, each drawing made thereunder, the obligations of any Borrower under this Agreement with respect thereto and any security therefore or guaranty pertaining thereto.  Upon any change in the Commitments of the Lenders pursuant to Section 1.14 or 12.04(b), it is hereby agreed that, with respect to all outstanding Specified Several Letters of Credit and Unpaid Drawings with respect thereto, there shall be an automatic adjustment to the participations pursuant to this Section 1.16 to reflect the new Percentages of the assigning and assignee Lender.

(d)        In determining whether to pay under any Specified Several Letter of Credit, no Pre-existing Lender shall have any obligation relative to the Lenders other than to determine that any documents required to be delivered under such Specified Several Letter of Credit have been delivered and that they appear to substantially comply on their face with the requirements of such Specified Several Letter of Credit, which obligation, it is understood, is being performed by the Issuing Agent, and upon whom each Pre-existing Lenders  shall be entitled to rely.  Any action taken or omitted to be taken by any Pre-existing Lender under or in connection with any Specified Several Letter of Credit issued by it shall not create for such Pre-existing Lender any resulting liability to any Borrower, any Lender or any other Person unless such
action is taken or omitted to be taken with gross negligence or willful misconduct (as determined by a court of competent jurisdiction in a final and non-appealable decision).

(e)        In the event that any Pre-existing Lender makes any payment under any Specified Several Letter of Credit issued by it and the respective Borrower shall not have reimbursed such amount in full to each Pre-existing Lender pursuant to Section 2.05, such Pre-existing Lender shall promptly notify the Administrative Agent, and the Administrative Agent shall promptly notify each Lender of such failure, and each such Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Pre-existing Lender, the amount of such Lender’s Percentage of such payment in Dollars and in same day funds.  If the Administrative Agent so notifies any Lender required to fund a payment under a Specified Several Letter of Credit prior to 11:00 A.M. (New York time) on any Business Day, such Lender shall make available to the
Administrative Agent at the Payment Office for the account of the respective Pre-existing Lender such Lender’s Percentage of the amount of such payment on such Business Day in same day funds (and, to the extent such notice is given after 11:00 A.M. (New York time) on any Business Day, such Lender shall make such payment on the immediately following Business Day).  If and to the extent such Lender shall not have so made its Percentage of the amount of such payment available to the Administrative Agent for the account of the respective Pre-existing Lender, such Lender agrees to pay to the Administrative Agent for the account of such Pre-existing Lender, forthwith on demand such amount, together with interest thereon, for each day from such date until the date such amount is paid to the Administrative Agent for the account of the Pre-existing Lender at the overnight Federal Funds Rate for the first three days and at the interest rate applicable to Loans that are maintained as
Base Rate Loans for each day thereafter.  The failure of any Lender to make available to the Administrative Agent for the account of the respective Pre-existing Lender its Percentage of any payment under any Specified Several Letter of Credit issued by it shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Pre-existing Lender its Percentage of any payment under any such Several Letter of Credit on the date required, as specified above, but no Lender shall be responsible for the failure 

 

 

	
             
 	
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of any other Lender to make available to the Administrative Agent for the account of such Pre-existing Lender such other Lender’s Percentage of any such payment.

(f)         Whenever any Pre-existing Lender receives a payment of a reimbursement obligation as to which the Administrative Agent has received for the account of such Pre-existing Lender any payments from the Lenders pursuant to clause (e) above, such Pre-existing Lender shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender which has paid its Percentage thereof same day funds, an amount equal to such Lender’s Percentage of the principal amount thereof and interest thereon accruing after the purchase of the respective participations. 

(g)        The obligations of the Lenders to make payments to the Administrative Agent for the account of the respective Pre-existing Lender with respect to Specified Several Letters of Credit issued by it shall be irrevocable and not subject to counterclaim, set-off or other defense or any other qualification or exception whatsoever and shall be made in accordance with the terms and conditions of this Agreement under all circumstances, including, without limitation, any of the following circumstances:

(i)         any lack of validity or enforceability of this Agreement or any of the other Credit Documents;

(ii)         the existence of any claim, set-off, defense or other right which the Company or any of its Subsidiaries may have at any time against a beneficiary named in a Specified Several Letter of Credit, any transferee of any Specified Several Letter of Credit (or any Person for whom any such transferee may be acting), the Administrative Agent, any Pre-existing Lender, or other Person, whether in connection with this Agreement, any Specified Several Letter of Credit, the transactions contemplated herein or any unrelated transactions (including any underlying transaction between the Company or any of its Subsidiaries and the beneficiary named in any such Specified Several Letter of Credit);

(iii)        any draft, certificate or other document presented under the Specified Several Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;

(iv)        the surrender or impairment of any security for the performance or observance of any of the terms of any of the Credit Documents; or

	
            (v)
 	
            the occurrence of any Default or Event of Default.
 

 

 

SECTION 2.  Letters of Credit.

2.01      Several Letters of Credit .  (a)Subject to and upon the terms and conditions set forth herein, each Borrower (other than any Irish Designated Subsidiary Borrower) may request that the Issuing Agent at any time and from time to time on or after the Restatement Effective Date 

 

 

	
             
 	
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and prior to the Final Maturity Date to issue, for the account of such Borrower and in support of, on a standby basis, Letter of Credit Supportable Obligations of such Borrower to any other Person and subject to and upon the terms and conditions herein set forth the Issuing Agent agrees to issue at any time and from time to time on or after the Restatement Effective Date and prior to the Final Maturity Date one or more irrevocable standby letters of credit in such form as may be approved by the Issuing Agent (each such letter of credit,  a “Several Letter of Credit” and, collectively, the “Several Letters of Credit”).

(b)        Each Several Letter of Credit will be issued by the Issuing Agent on behalf of the Lenders and each Lender will participate in each Several Letter of Credit pro rata in accordance with its Percentage.  The obligations of each Lender under and in respect of each Several Letter of Credit are several, and the failure by any Lender to perform its obligations hereunder or under any Letter of Credit shall not affect the obligations of the respective Borrower toward any other party hereto nor shall any other such party be liable for the failure by such Lender to perform its obligations hereunder or under any Several Letter of Credit.

(c)        Each Several Letter of Credit shall be executed and delivered by the Issuing Agent in the name and on behalf of, and as attorney-in-fact for, each Lender and the Issuing Agent shall act under each Several Letter of Credit, and each Several Letter of Credit shall expressly provide that the Issuing Agent shall act, as the agent of each Lender to (a) receive drafts, other demands for payment and other documents presented by the beneficiary under such Several Letter of Credit, (b) determine whether such drafts, demands and documents are in compliance with the terms and conditions of such Letter of Credit and (c) notify such Lender and such Borrower that a valid drawing has been made and the date that the related Several Unpaid Drawing is to be made; provided that the Issuing Agent shall have no obligation or liability for any Several Unpaid
Drawing under such Letter of Credit, and each Several Letter of Credit shall expressly so provide.  Each Lender hereby irrevocably appoints and designates the Issuing Agent as its attorney-in-fact, acting through any duly authorized officer of the Issuing Agent, to execute and deliver in the name and on behalf of such Lender each Several Letter of Credit to be issued by such Lender hereunder.  Promptly upon the request of the Issuing Agent, each Lender will furnish to the Issuing Agent such powers of attorney or other evidence as any beneficiary of any Several Letter of Credit may reasonably request in order to demonstrate that the Issuing Agent has the power to act as attorney-in-fact for such Lender to execute and deliver such Several Letter of Credit. 

(d)        Each Lender represents and warrants that each Several Letter of Credit constitutes a legal, valid and binding obligation of such Lender enforceable in accordance with its terms, provided that the enforceability thereof is subject to general principles of equity and to bankruptcy, insolvency and similar laws affecting the enforcement of creditors’ rights generally.

2.02      Fronted Letters of Credit.  (a) Subject to and upon the terms and conditions set forth herein, each Borrower may request that any Fronting Lender at any time and from time to time on or after the Restatement Date and prior to the Final Maturity Date issue for its own account a letter of credit for the account of such Borrower and in support of, on a standby basis, Letter of Credit Supportable Obligations of such Borrower to any other Person and subject to and upon the terms and conditions herein set forth, each Fronting Lender agrees to issue at any time and from time to time on or after the Restatement Effective Date and prior to the Final 

 

 

	
             
 	
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Maturity Date one or more irrevocable standby letters of credit in such form as may be approved by such Fronting Lender (each such letter of credit, a “Fronted Letter of Credit” and, collectively, the “Fronted Letters of Credit”); provided that the aggregate Stated Amount of all such Fronted Letters of Credit shall not exceed $100,000,000 at any time. Notwithstanding anything to the contrary contained herein, no Fronted Letter of Credit shall be issued for the account of an Irish Designated Subsidiary Borrower unless the Fronting Lender issuing such Fronted Letter of Credit is an Irish licensed bank or an authorized credit institution within the meaning of Directive 2000/12/EC.

(b)        Immediately upon the issuance by any Fronting Lender of any Fronted Letter of Credit, such Fronting Lender shall be deemed to have sold and transferred to each Lender other than such Fronting Lender (each such Lender, in its capacity as a “participant” under any Fronted Letter of Credit, a “Fronting Participant”), and each such Fronting Participant shall be deemed irrevocably and unconditionally to have purchased and received from such Fronting Lender, without recourse or warranty, an undivided interest and participation, to the extent of such Fronting Participant’s Percentage, in such Fronted Letter of Credit, each drawing made thereunder and the obligations of each Borrower under this Agreement with respect thereto, and any security therefor or guaranty pertaining thereto.  Upon any change in the Commitments or
Percentages of the Lenders pursuant to this Agreement (including, without limitation, pursuant to Section 1.16), it is hereby agreed that, with respect to all then outstanding Fronted Letters of Credit and Fronted Unpaid Drawings, there shall be an automatic adjustment to the participations pursuant to this Section 2.02 to reflect the new Percentages resulting from such change or changes, as the case may be.

(c)        In the event that any Fronting Lender makes any payment under any Fronted Letter of Credit and the respective Borrower shall not have reimbursed such amount in full to such Fronting Lender pursuant to Section 2.05, such Fronting Lender shall promptly notify the Administrative Agent, which shall promptly notify each Fronting Participant, of such failure, and each Fronting Participant shall promptly and unconditionally pay to such Fronting Lender the amount of such Fronting Participant’s Percentage of such unreimbursed payment in U.S. Dollars and in immediately available funds.  If, prior to 11:00 A.M. (New York time) on any Business Day, the Administrative Agent so notifies any Fronting Participant required to fund a payment under a Fronted Letter of Credit, such Fronting Participant shall make available to such Fronting Lender in U.S.
Dollars and in immediately available funds such Fronting Participant’s Percentage of the amount of such payment on such Business Day (or, if notice is given after 11:00 A.M. (New York time) on any Business Day, on the next Business Day).  If and to the extent such Fronting Participant shall not have so made its Percentage of the amount of such payment available to such Fronting Lender, such Fronting Participant agrees to pay to such Fronting Lender, forthwith on demand such amount, together with interest thereon, for each day from such date to but excluding the date such amount is paid to such Fronting Lender at the overnight Federal Funds Effective Rate.  The failure of any Fronting Participant to make available to such Fronting Lender its Percentage of any payment under any Fronted Letter of Credit shall not relieve any other Fronting Participant of its obligation hereunder to make available to such Fronting Lender its Percentage of any payment on the date required, as
specified above, but no Fronting Participant shall be responsible for the failure of any other Fronting Participant to make available to such Fronting Lender such other Fronting Participant’s Percentage of any such payment.

 

 

	
             
 	
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(d)        Whenever any Fronting Lender receives any payment by any Borrower as to which it has also received payments from the Fronting Participants pursuant to clause (c) above, such Fronting Lender shall forward such payment to the Administrative Agent, which in turn shall distribute to each Fronting Participant which has paid its Percentage thereof, in U.S. Dollars and in immediately available funds, an amount equal to such Fronting Participant’s share (based upon the amount funded by such Fronting Participant to the aggregate amount funded by all Fronting Participants and retained by such Fronting Lender) of the principal amount of such payment and interest thereon accruing after the purchase of the respective participations.

(e)        The obligations of the Fronting Participants to make payments to each Fronting Lender with respect to Fronted Letters of Credit issued by it shall be irrevocable and not subject to any qualification or exception whatsoever and shall be made in accordance with the terms and conditions of this Agreement under all circumstances, including, without limitation, any of the following circumstances:

(i)         any lack of validity or enforceability of this Agreement or any of the other Credit Documents or any amendment, supplement or modification to any of the foregoing;

(ii)         the existence of any claim, setoff, defense or other right which the Fronting Participant or any of its Affiliates may have at any time against a beneficiary named in a Fronted Letter of Credit, any transferee of any Fronted Letter of Credit (or any Person for whom any such transferee may be acting), the Administrative Agent, any Fronting Lender, any Fronting Participant, any Lender, or any other Person, whether in connection with this Agreement, any Fronted Letter of Credit, the transactions contemplated herein or any unrelated transactions (including any underlying transaction between any Borrower or any of its Affiliates and the beneficiary named in any such Fronted Letter of Credit);

(iii)        any draft, certificate or any other document presented under any Fronted Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;

(iv)        the surrender or impairment of any security for the performance or observance of any of the terms of any of the Credit Documents; or

	
            (v)
 	
            the occurrence of any Default or Event of Default; or
 
	
            (vi)
 	
            any matter or event set forth in subsection 2.05.
 	
             

(f)         Upon the request of any Fronting Participant, each Fronting Lender shall furnish to such Fronting Participant copies of any Fronted Letter of Credit issued by it and such other documentation as may reasonably be requested by such Fronting Participant.

(g)        Notwithstanding anything to the contrary contained in this Agreement, the provisions of this Section 2 shall not be amended, modified or waived in a manner adverse to the rights or obligations of any Fronting Lender without the consent of each Fronting Lender affected thereby.

 

 

	
             
 	
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2.03      Conditions to the Issuance of all Letters of Credit.  (a) Notwithstanding anything to the contrary set forth in this Section 2, no LC Issuer shall be under any obligation to issue any Letter of Credit if at the time of such issuance:

(i)         any order, judgment or decree of any Governmental Authority or arbitrator shall purport by its terms to enjoin or restrain such LC Issuer from issuing such Letter of Credit or any requirement of law applicable to such LC Issuer or any Lender or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such LC Issuer or any Lender shall prohibit, or request that such LC Issuer or any Lenders refrain from, the issuance of Letters of Credit generally or such Letter of Credit in particular or shall impose upon such LC Issuer or any Lender with respect to such Letter of Credit any restriction or reserve or capital requirement (for which such LC Issuer is not otherwise compensated) not in effect on the Restatement Effective Date, or any unreimbursed
loss, cost or expense which was not applicable, in effect or known to such LC Issuer as of the Restatement Effective Date; 

(ii)         the conditions precedent set forth in Section 5.02 are not satisfied at that time; or

(iii)        such LC Issuer shall have received notice from any Borrower or the Required Lenders prior to the issuance of such Letter of Credit of the type described in clause (v) of Section 2.03(b).

	
            (b)
 	
            Not­with­standing anything to the contrary set forth in this Section 2:
 

(i)         no Letter of Credit shall be issued the Stated Amount of which, when added to (x) the Letter of Credit Outstandings (exclusive of Unpaid Drawings which are repaid on the date of, and prior to the issuance of, the respective Letter of Credit) at such time, and (y) the aggregate Principal Amount of all Loans then outstanding, would exceed the Total Commitment at such time;

(ii)         each Letter of Credit may be denominated in any Approved Currency as determined by each such Borrower at the time of issuance; provided that the aggregate Stated Amount of all non-U.S. Dollar denominated Letters of Credit does not exceed $100,000,000 at any time;

(iii)        no Fronted Letter of Credit shall be issued at any time if after giving effect thereto the Letter of Credit Outstandings attributable to all Fronted Letters of Credit would exceed $100,000,000; 

(iv)        each Letter of Credit shall have an expiry date occurring not later than one year after such Letter of Credit’s date of issuance, provided that each such Letter of Credit may by its terms automatically renew annually for one additional year unless the respective LC Issuer notifies the beneficiary thereof, in accordance with the terms of such Letter of Credit, that such Letter of Credit will not be renewed; and

(v)        no LC Issuer will issue any Letter of Credit after it has received written notice from any Borrower or the Required Lenders stating that any condition precedent 

 

 

	
             
 	
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set forth in Section 5.02 is not satisfied until such time as the Issuing Agent shall have received a written notice of (x) rescission of such notice from the party or parties originally delivering the same or (y) a waiver of such condition precedent by the Required Lenders.

(c)        Subject to and on the terms and conditions set forth herein, each LC Issuer is hereby authorized by each Borrower and the Lenders to arrange for the issuance of any Letter of Credit pursuant to Section 2.01 or 2.02 and the amendment of any Letter of Credit pursuant to Section 2.08 and/or 12.04(b) by: 

(i)         completing the commencement date and the expiry date of such Letter of Credit;

(ii)         (in the case of an amendment increasing or reducing the amount thereof) amending such Letter of Credit in such manner as such LC Issuer and the respective beneficiary may agree;

(iii)        in the case of Several Letters of Credit, completing such Several Letter of Credit with the participation of each Lender as allocated pursuant to the terms hereof; and

(iv)        in the case of Several Letters of Credit, executing such Several Letter of Credit on behalf of each Lender and following such execution delivering such Several Letter of Credit to the beneficiary of such Letter of Credit.

 

	
            2.04
 	
            Letter of Credit Requests
 

 

(a)        . Whenever a Borrower desires that a Letter of Credit be issued, such Borrower shall give the Administrative Agent and the respective LC Issuer written notice (including by way of facsimile transmission, immediately confirmed in writing by submission of the original of such request by mail to the Issuing Agent) thereof prior to 12:00 Noon (New York time) at least five Business Days (or such shorter period as may be acceptable to the Issuing Agent and the respective LC Issuer) prior to the proposed date of issuance (which shall be a Business Day), which written notice shall be in the form of Exhibit I (each, a “Letter of Credit Request”).  Each Letter of Credit Request shall include any other documents as the respective LC Issuer customarily requires in connection therewith.

(b)        The making of each Letter of Credit Request shall be deemed to be a representation and warranty by the Borrower that such Letter of Credit may be issued in accordance with, and it will not violate the requirements of, Section 2.01 or 2.02, as the case may be, and Section 2.03.

(c)        Upon its issuance of, or amendment to, any Letter of Credit, the respective LC Issuer shall promptly notify the respective Borrower and the Lenders of such issuance or amendment, which notice shall include a summary description of the Letter of Credit actually issued and any amendments thereto.

 

 

	
             
 	
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2.05      Agreement to Repay Letter of Credit Drawings(a)       .  Each Borrower agrees to reimburse (x) each Lender, by making payment to the Administrative Agent in immediately available funds, for any payment or disbursement made by such Lender under any Several Letter of Credit (each such amount so paid or disbursed until reimbursed, a “Several Unpaid Drawing”) no later than three Business Days following the date of such payment or disbursement and (y) the respective Fronting Lender directly for any payment or disbursement made by such Fronting Lender under any Fronted Letter of Credit (each such amount so paid or disbursed until reimbursed, a “Fronted Unpaid Drawing”) no later than one Business Day following the date of such payment or disbursement, in each case, with interest on the amount so
paid or disbursed by such Lender, to the extent not reimbursed prior to 1:00 P.M. (New York time) on the date of such payment or disbursement, from and including the date paid or disbursed to but not including the date such Lender is reimbursed therefor at a rate per annum which shall be the Base Rate plus the Applicable Margin, as in effect from time to time (plus an additional 2% per annum, payable on demand, if not reimbursed by the third Business Day after the date on which the respective Borrower receives notice from the respective LC Issuer of such payment or disbursement).

(b)        Each Borrower’s obligation under this Section 2.05 to reimburse each Lender or each LC Issuer with respect to Unpaid Drawings (including, in each case, interest thereon) shall be absolute and unconditional under any and all circumstances and irrespective of any setoff, counterclaim or defense to payment which such Borrower may have or have had against such Lender or any LC Issuer, including, without limitation, any defense based upon the failure of any drawing under a Letter of Credit to conform to the terms of the Letter of Credit or any non-application or misapplication by the beneficiary of the proceeds of such drawing; provided, however, that no Borrower shall be obligated to reimburse any Lender or any LC Issuer for any wrongful
payment made by such Lender or any LC Issuer under a Letter of Credit as a result of acts or omissions constituting willful misconduct or gross negligence on the part of such Lender or such LC Issuer (as determined by a court of competent jurisdiction in a final and non-appealable decision).

(c)        In determining whether to pay under any Fronted Letter of Credit, no Fronting Lender shall have any obligation relative to any Fronting Participant other than to confirm that any documents required to be delivered under such Fronted Letter of Credit appear to have been delivered and that they appear to substantially comply on their face with the requirements of such Fronted Letter of Credit.  Any action taken or omitted to be taken by any LC Issuer under or in connection with any Fronted Letter of Credit, if taken or omitted in the absence of such LC Issuer’s gross negligence or willful misconduct (as determined by a court of competent jurisdiction in a final and non-appealable decision), shall not create for such LC Issuer any resulting liability to any Borrower, any Lender or any of their respective Affiliates.  

2.06      Increased Costs.  If after the Restatement Effective Date, the adoption or effectiveness of any applicable law, rule or regulation, order, guideline or request or any change therein after the Restatement Effective Date, or any change adopted or effective after the Restatement Effective Date in the interpretation or administration thereof by any Governmental Authority, central bank or comparable agency charged with the interpretation or administration thereof, or compliance by any Lender with any request or directive (whether or not having the force of law) by any such authority, central bank or comparable agency shall either (i) impose, 

 

 

	
             
 	
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modify or make applicable any reserve, deposit, capital adequacy or similar requirement against Letters of Credit issued by or participated in by such Lender, or (ii) impose on such Lender any other conditions directly or indirectly affecting this Agreement or any Letter of Credit; and the result of any of the foregoing is to increase the cost to such Lender of issuing, maintaining or participating in any Letter of Credit, or to reduce the amount of any sum received or receivable by such Lender hereunder or reduce the rate of return on its capital with respect to Letters of Credit, then, upon written demand to the applicable Borrower by such Lender (with a copy to the Administrative Agent), pay to such Lender such additional amount or amounts as will compensate such Lender for such increased cost or reduction.  The preceding sentence shall not apply to increased costs with respect to taxes imposed on or
measured by the net income or net profits of a Lender pursuant to the laws of the jurisdiction in which it is organized or the jurisdiction in which the principal office or applicable lending office of such Lender is located or any subdivision thereof or therein or with respect to Taxes to the extent that a Lender received additional amounts (or otherwise was indemnified) for such Taxes pursuant to Section 4.04 (or would have received additional amounts pursuant to Section 4.04(a) but for a failure to comply with Section 4.04(b) or Section 4.04(c)).  A certificate submitted to the applicable Borrower by such Lender (with a copy to the Administrative Agent), setting forth the basis for the determination of such additional amount or amounts necessary to compensate such Lender as aforesaid shall be final and conclusive and binding on the applicable Borrower absent manifest error, although the failure to deliver any such certificate shall not release or diminish the Borrowers’
obligations to pay additional amounts pursuant to this Section 2.06 upon subsequent receipt of such certificate.  The Borrowers shall not be obligated to pay any additional amounts arising pursuant to this Section 2.06 that are attributable to the Excluded Period with respect to such additional amount; provided, that if an applicable law, rule, regulation, guideline or request shall be adopted or made on any date and shall be applicable to the period prior to the date on which such law, rule, regulation, guideline or request is adopted or made, the limitation on each Borrower’s obligations to pay such additional amounts hereunder shall not apply to the additional amounts payable in respect of such period.

2.07      Letter of Credit Expiration Extensions.  Each Lender acknowledges that to the extent provided under the terms of any Letter of Credit, the expiration date of such Letter of Credit will be automatically extended for an additional year, without written amendment, unless at least 30 days prior to the expiration date of such Letter of Credit, notice is given by the respective LC Issuer in accordance with the terms of the respective Letter of Credit (a “Notice of Non-Extension”) that the expiration date of such Letter of Credit will not be extended beyond its current expiration date.  The respective LC Issuer will give Notices of Non-Extension as to any or all outstanding Letters of Credit if requested to do so by the Required Lenders pursuant to Section 9.01.  The respective LC Issuer will give Notices of Non-Extension as
to all outstanding Letters of Credit if the Final Maturity Date has occurred.  The respective LC Issuer will send a copy of each Notice of Non-Extension to the Company concurrently with delivery thereof to the respective beneficiary, unless prohibited by law from doing so.

2.08      Changes to Stated Amount.  At any time when any Letter of Credit is outstanding, at the request of the respective Borrower, the Issuing Agent will enter into an amendment increasing or reducing the Stated Amount of such Letter of Credit, provided that (i) in no event shall the Stated Amount of such Letter of Credit be increased to an amount which, (x) when added to the Letter of Credit Outstandings at such time attributable to all Letters of 

 

 

	
             
 	
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Credit and the aggregate Principal Amount of all Loans then outstanding, would exceed the Total Commitment, or (y) would cause the Letter of Credit Outstandings attributable to all Fronted Letters of Credit to exceed $100,000,000, (ii) the Stated Amount of a Letter of Credit may not be increased at any time if the conditions precedent set forth in Section 5.02 are not satisfied at such time, and (iii) the Stated Amount of a Letter of Credit may not be increased at any time after the Final Maturity Date.

2.09      Confirming Letters of Credit.    Notwithstanding anything contained herein, to the extent a Letter of Credit has been requested by a Borrower subject to and upon the terms and conditions set forth herein, and the Borrower has requested that the Issuing Agent have such Letter of Credit confirmed by a confirming bank, each Lender hereby makes, constitutes, and appoints the Issuing Agent its true and lawful attorney-in-fact, in its name, place and stead, giving the Issuing Agent the full power to request, on behalf of each Lender, a confirmation by such confirming bank relating to such Letter of Credit and to take any other action with respect to the confirmation of such Letter of Credit as the Issuing Agent deems necessary; provided that the Issuing Agent shall have no
liability for any reimbursement or other obligations to any confirming bank. Promptly upon request of the Issuing Agent, each Lender will furnish to the Issuing Agent such powers of attorney or other evidence as any confirming bank may reasonably request in order to demonstrate that the Issuing Agent has the power to act as attorney-in-fact for such Lender to have such Letter of Credit confirmed by such confirming bank.

2.10      Existing Fronted Letters of Credit.  It is hereby agreed and acknowledged that all Fronted Letters of Credit described on Annex VI hereto (the “Existing Fronted Letters of Credit”) which were issued under the Existing Credit Agreement and which remain outstanding on the Restatement Effective Date shall be deemed issued under this Agreement as a “Fronted Letter of Credit” on the Restatement Effective Date.

2.11      Existing Several Letters of Credit.  (a)  It is hereby agreed and acknowledged that all Several Letters of Credit described on Annex VII (the “Existing Several Letters of Credit”) which were issued and which remain outstanding on the Restatement Effective Date shall be deemed issued under this Agreement as a “Several Letter of Credit” on the Restatement Effective Date.  As soon as possible following the Restatement Effective Date, each Existing Several Letter of Credit shall be amended to replace each Existing Lender with each Lender party to this Agreement at the time of such amendment in accordance with each such Lender’s Percentage.  Until an Existing Several Letter of Credit has been amended in accordance with this Section 2.11 each Existing Lender shall be deemed to have sold and transferred
to each Lender, and each such Lender shall be deemed irrevocably and unconditionally to have purchased and received from such Existing Lender, without recourse or warranty, an undivided interest and participation, to the extent of such Lender’s Percentage, in such Existing Several Letter of Credit, each substitute Existing Several Letter of Credit, each drawing made thereunder, the obligations of any Borrower under this Agreement with respect thereto and any security therefore or guaranty pertaining thereto.  Upon any change in the Commitments of the Lenders pursuant to Section 1.14, 1.16 or 12.04(b), it is hereby agreed that, with respect to all outstanding Existing Several Letters of Credit and Unpaid Drawings with respect thereto, there shall be an automatic adjustment to the participations pursuant to this Section 2.11 to reflect the new Percentages of the assigning and assignee Lender.

 

 

	
             
 	
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(b)        In determining whether to pay under any Existing Several Letter of Credit, no Existing Lender shall have any obligation relative to the Lenders other than to determine that any documents required to be delivered under such Existing Several Letter of Credit have been delivered and that they appear to substantially comply on their face with the requirements of such Existing Several Letter of Credit, which obligation, it is understood, is being performed by the Issuing Agent, and upon whom each Existing Lenders  shall be entitled to rely.  Any action taken or omitted to be taken by any Existing Lender under or in connection with any Existing Several Letter of Credit issued by it shall not create for such Existing Lender any resulting liability to any Borrower, any Lender or any other Person unless such action is taken or
omitted to be taken with gross negligence or willful misconduct (as determined by a court of competent jurisdiction in a final and non-appealable decision).

(c)        In the event that any Existing Lender makes any payment under any Existing Several Letter of Credit issued by it and the respective Borrower shall not have reimbursed such amount in full to each Existing Lender pursuant to Section 2.05, such Existing Lender shall promptly notify the Administrative Agent, and the Administrative Agent shall promptly notify each Lender of such failure, and each such Lender shall promptly and unconditionally pay to the Administrative Agent for the account of such Existing Lender, the amount of such Lender’s Percentage of such payment in Dollars and in same day funds.  If the Administrative Agent so notifies any Lender required to fund a payment under an Existing Several Letter of Credit prior to 11:00 A.M. (New York time) on any Business Day, such Lender shall make available to the Administrative Agent
at the Payment Office for the account of the respective Existing Lender such Lender’s Percentage of the amount of such payment on such Business Day in same day funds (and, to the extent such notice is given after 11:00 A.M. (New York time) on any Business Day, such Lender shall make such payment on the immediately following Business Day).  If and to the extent such Lender shall not have so made its Percentage of the amount of such payment available to the Administrative Agent for the account of the respective Existing Lender, such Lender agrees to pay to the Administrative Agent for the account of such Existing Lender, forthwith on demand such amount, together with interest thereon, for each day from such date until the date such amount is paid to the Administrative Agent for the account of the Existing Lender at the overnight Federal Funds Rate for the first three days and at the interest rate applicable to Loans that are maintained as Base Rate Loans for each day
thereafter.  The failure of any Lender to make available to the Administrative Agent for the account of the respective Existing Lender its Percentage of any payment under any Existing Several Letter of Credit issued by it shall not relieve any other Lender of its obligation hereunder to make available to the Administrative Agent for the account of such Existing Lender its Percentage of any payment under any such Several Letter of Credit on the date required, as specified above, but no Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of such Existing Lender such other Lender’s Percentage of any such payment.

(d)        Whenever any Existing Lender receives a payment of a reimbursement obligation as to which the Administrative Agent has received for the account of such Existing Lender any payments from the Lenders pursuant to clause (c) above, such Existing Lender shall pay to the Administrative Agent and the Administrative Agent shall promptly pay to each Lender which has paid its Percentage thereof same day funds, an amount equal to such Lender’s 

 

 

	
             
 	
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Percentage of the principal amount thereof and interest thereon accruing after the purchase of the respective participations. 

(e)        The obligations of the Lenders to make payments to the Administrative Agent for the account of the respective Existing Lender with respect to Existing Several Letters of Credit issued by it shall be irrevocable and not subject to counterclaim, set-off or other defense or any other qualification or exception whatsoever and shall be made in accordance with the terms and conditions of this Agreement under all circumstances, including, without limitation, any of the following circumstances:

(i)         any lack of validity or enforceability of this Agreement or any of the other Credit Documents;

(ii)         the existence of any claim, set-off, defense or other right which the Company or any of its Subsidiaries may have at any time against a beneficiary named in an Existing Several Letter of Credit, any transferee of any Existing Several Letter of Credit (or any Person for whom any such transferee may be acting), the Administrative Agent, any Existing Lender, or other Person, whether in connection with this Agreement, any Existing Several Letter of Credit, the transactions contemplated herein or any unrelated transactions (including any underlying transaction between the Company or any of its Subsidiaries and the beneficiary named in any such Existing Several Letter of Credit);

(iii)        any draft, certificate or other document presented under the Existing Several Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect;

(iv)        the surrender or impairment of any security for the performance or observance of any of the terms of any of the Credit Documents; or

	
            (v)
 	
            the occurrence of any Default or Event of Default.
 

 

SECTION 3.  Fees; Commitments.

3.01      Fees.  (a)The Company agrees to pay to the Administrative Agent a facility fee (the “Facility Fee”) for the account of the Lenders pro rata on the basis of their respective Commitments for the period from and including the Restatement Effective Date to but not including the date the Total Commitment has been terminated computed at a rate per annum equal to the Applicable Facility Fee Percentage of the Total Commitment, regardless of utilization, as in effect from time to time.  Accrued Facility Fees shall be due and payable quarterly in arrears on the last Business Day of each calendar quarter, on the Final Maturity Date or upon such earlier date as the Total Commitment shall be terminated and, with respect to any
Facility Fee owing to any Lender whose Commitment is terminated pursuant to Section 1.14, on the date on which such Lender’s Commitment is terminated.

(b)        The Company agrees to pay to the Administrative Agent a utilization fee (the “Utilization Fee”) for the account of the Lenders pro rata on the basis of, their respective 

 

 

	
             
 	
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Commitments, for the period from and including the Restatement Effective Date to but not including the Final Maturity Date computed at a rate per annum equal to the Applicable Utilization Fee Percentage of the aggregate amount of Revolving Loans outstanding at any time when the aggregate outstanding amount of Revolving Loans is greater than 50% of the Loan Sublimit at such time. Accrued Utilization Fees shall be due and payable quarterly in arrears on the last Business Day of each calendar quarter and on the Final Maturity Date and, with respect to any Utilization Fee owing to any Lender whose Commitment is terminated pursuant to Section 1.14, on the date on which such Lender’s Commitment is terminated.

(c)        Each Borrower shall pay to the Administrative Agent for pro rata distribution to each Lender (based on their respective Percentages), a fee in respect of each Letter of Credit issued for the account of such Borrower (the “Letter of Credit Fee”) computed at a rate per annum equal to the Applicable L/C Percentage then in effect on the daily Stated Amount of such Letter of Credit. Accrued Letter of Credit Fees shall be due and payable quarterly in arrears on the last Business Day of each calendar quarter and upon the first day on or after the termination of the Total Commitment upon which no Letters of Credit remain outstanding.

(d)        Each Borrower shall pay directly to the Issuing Agent upon each issuance of and/or amendment of, a Letter of Credit issued for the account of such Borrower such amount as shall at the time of such issuance or amendment be the administrative charge which the Issuing Agent is customarily charging for issuances of or amendments of letters of credit issued by it (it being understood and agreed that, for purposes of this Agreement, such charges shall not increase more than once every six months).

(e)        The Borrowers jointly and severally agree to pay to the Administrative Agent, for the account of the Administrative Agent, when and as due, such fees as have been, or are from time to time, separately agreed upon.

(f)         Each Borrower agrees to pay directly to the respective Fronting Lender, for its own account, a facing fee in respect of each Fronted Letter of Credit issued by it hereunder (the “Facing Fee”), in each case, at the rates separately agreed upon by the Company and such Fronting Lender.

(g)        All computations of Fees shall be made in accordance with Section 12.07(b).

3.02      Voluntary Reduction of Commitments.  Upon at least three Business Days’ prior written notice (or telephonic notice confirmed in writing) to the Administrative Agent at the Notice Office (which notice shall be deemed to be given on a certain day only if given before 12:00 Noon (New York time) on such day and shall be promptly transmitted by the Administrative Agent to each of the Lenders), the Company shall have the right, without premium or penalty, to terminate or partially reduce the Total Unutilized Commitment, provided that (x) any such termination shall apply to proportionately and permanently reduce the Commitment of each Lender and (y) any partial reduction pursuant to this Section 3.02 shall be in the amount of at least $10,000,000.

 

 

	
             
 	
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3.03      Mandatory Reduction of Commitments.  (a)The Total Commitment shall terminate in its entirety on October 15, 2005, unless the Restatement Effective Date has occurred on or before such date.

(b)        The Total Commitment shall terminate in its entirety on the Final Maturity Date.

SECTION 4.  Payments.

4.01      Voluntary Prepayments.  Each Borrower shall have the right to prepay Revolving Loans made to it in whole or in part, without premium or penalty, from time to time on the following terms and conditions:  (i) such Borrower shall give the Administrative Agent at the Payment Office written notice (or telephonic notice promptly confirmed in writing) of its intent to prepay the Revolving Loans, the amount of such prepayment, the currency in which such Loans are denominated and the specific Borrowing(s) pursuant to which such Loans were made, which notice shall be given by such Borrower (x) prior to 12:00 Noon (New York time) at least one Business Day prior to the date of such prepayment in the case of Base Rate Loans and (y) at least three Business Days prior to the date of such prepayment in the case of Eurodollar Loans,
and which notice shall promptly be transmitted by the Administrative Agent to each of the Lenders; (ii) each partial prepayment shall be in an aggregate principal amount of at least $1,000,000, or the Dollar Equivalent thereof, provided that no partial prepayment of any Revolving Loans shall reduce the aggregate principal amount of the Revolving Loans outstanding to an amount less than the Minimum Borrowing Amount applicable thereto; (iii) each prepayment in respect of any Revolving Loans made pursuant to a Borrowing shall be applied pro rata among such Revolving Loans; and (iv) prepayments of Eurodollar Loans made pursuant to this Section 4.01 may only be made on the last day of an Interest Period applicable thereto unless concurrently with such prepayment any payments required to be made pursuant to Section 1.12 as a result of such prepayment are made.  No Borrower shall have
the right under this Section 4.01 to prepay any principal amount of any Competitive Bid Loans.

4.02      Mandatory Prepayments.  (a)If on any date prior to the Final Maturity Date (including, without limitation, any date on which Dollar Equivalents are determined pursuant to Section 12.07(c)), the sum of the aggregate outstanding Principal Amount of Loans (all the foregoing, collectively, the “Aggregate Loan Outstandings”) plus the Letter of Credit Outstandings exceeds 105% of the Total Commitment as then in effect, the Company shall cause one or more Borrowers to repay on such day the principal amount of the outstanding Revolving Loans in an aggregate Principal Amount equal to the amount by which the Aggregate Loan Outstandings plus the Letter of Credit Outstandings exceed the Total Commitment as then in effect.  If, after giving effect to the prepayment of all outstanding Revolving Loans, as set forth above, the sum of
the remaining Aggregate Loan Outstandings plus the Letter of Credit Outstandings exceed the Total Commitment, the Company shall cause one or more Borrowers to pay to the Administrative Agent at the Payment Office on such date an amount of cash and/or Cash Equivalents equal to the amount of such excess (up to a maximum amount equal to the sum of the outstanding Competitive Bid Loans plus the Letter of Credit Outstandings at such time), such cash and/or Cash Equivalents to be held as security for all obligations of the Borrowers to the Lenders hereunder in a cash collateral account to be established by the Administrative Agent on terms reasonably satisfactory to the Administrative Agent.

 

 

	
             
 	
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(b)        If on any date prior to the Final Maturity Date (including, without limitation, any date on which Dollar Equivalents are determined pursuant to Section 12.07(c)), the aggregate Principal Amount of Revolving Loans exceeds the Loan Sublimit at such time, then the Company shall cause one or more Borrowers to repay Revolving Loans incurred by them in an aggregate amount equal to the amount by which the Aggregate Loan Outstandings exceed the Loan Sublimit at such time.

(c)        If on any date after the Final Maturity Date (including, without limitation, any date on which Dollar Equivalents are determined pursuant to Section 12.07(c)), the Letter of Credit Outstandings exceed 105% of the L/C FMD Amount, the Company shall cause one or more Borrowers to pay to the Administrative Agent at the Payment Office on such date an amount of cash and/or Cash Equivalents equal to the amount by which the Letter of Credit Outstandings exceed the L/C FMD Amount, such cash and/or Cash Equivalents to be held as security for all obligations of the Borrowers to the Lenders hereunder in a cash collateral account to be established by the Administrative Agent on terms reasonably satisfactory to the Administrative Agent.

(d)        On the maturity date specified pursuant to Section 1.04(a) with respect to each Competitive Bid Loan, the applicable Borrower shall repay such Competitive Bid Loan to the applicable Bidder Lender or Bidder Lenders.  Notwithstanding anything to the contrary contained herein, all Competitive Bid Loans shall be repaid in full on the Final Maturity Date unless paid in full prior to such date.

(e)        Notwithstanding anything to the contrary contained elsewhere in this Agreement, all outstanding Revolving Loans shall be repaid in full on the Final Maturity Date.

(f)         With respect to each prepayment of Loans required by Section 4.02(a), (b), (c) or (d), the applicable Borrower may designate the Types of Loans which are to be prepaid and the specific Borrowing(s) pursuant to which made, provided that (i) if any prepayment of Eurodollar Loans denominated in Dollars made pursuant to a single Borrowing shall reduce the outstanding Loans made pursuant to such Borrowing to an amount less than the Minimum Borrowing Amount for such Borrowing, then all Loans outstanding pursuant to such Borrowing shall be immediately converted into Base Rate Loans and (ii) each prepayment of any Loans made pursuant to a Borrowing shall be applied pro rata among such Loans.  In the
absence of a designation by a Borrower as described in the preceding sentence, the Administrative Agent shall, subject to the above, make such designation in its sole discretion with a view, but no obligation, to minimize breakage costs owing under Section 1.12.

(g)        It is understood that, notwithstanding anything in this Section 4.02 to the contrary, each Designated Subsidiary Borrower shall only be required to repay or provide cash collateral for its own Loans and Letters of Credit, and shall not be liable for the Loans or Letters of Credit of any other Borrower.

4.03      Method and Place of Payment.  Except as otherwise specifically provided herein, all payments under this Agreement shall be made to the Administrative Agent for the ratable (based on its pro rata share) account of the Lenders entitled thereto, not later than 12:00 Noon (New York time) on the date when due and shall be made in immediately available funds 

 

 

	
             
 	
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at the Payment Office in (x) Dollars, if such payment is made in respect of any obligation of the Borrowers under this Agreement except as otherwise provided in the immediately succeeding clause (y); and (y) the appropriate Alternate Currency, if such payment is made in respect of principal of or interest on Alternate Currency Loans, it being understood that written notice by a Borrower to the Administrative Agent to make a payment from the funds in such Borrower’s account at the Payment Office shall constitute the making of such payment to the extent of such funds held in such account.  Any payments under this Agreement which are made later than 12:00 Noon (New York time) shall be deemed to have been made on the next succeeding Business Day.  Whenever any payment to be made hereunder shall be stated to be due on a day which is not a Business Day, the due date thereof shall be extended to the
next succeeding Business Day and, with respect to payments of principal, interest shall be payable during such extension at the applicable rate in effect immediately prior to such extension.  The Administrative Agent will promptly make available to each Lender its pro rata share (if any) of each payment so received by the Administrative Agent in the funds and currency so received.

4.04      Net Payments.  (a)All payments made by each Borrower hereunder or under any Note will be made without setoff, counterclaim or other defense.  Except as provided in Section 4.04(b), all such payments will be made free and clear of, and without deduction or withholding for, any present or future taxes, levies, imposts, duties, fees, assessments or other charges of whatever nature now or hereafter imposed by any jurisdiction or by any political subdivision or taxing authority thereof or therein with respect to such payments (but excluding, except as provided in the second succeeding sentence, any tax imposed on or measured by the net income or net profits of a Lender pursuant to the laws of the jurisdiction in which it is organized or the jurisdiction in which the principal office or applicable lending office of such Lender is
located or any subdivision thereof or therein) and all interest, penalties or similar liabilities with respect to such non-excluded taxes, levies, imposts, duties, fees, assessments or other charges (all such non-excluded taxes, levies, imposts, duties, fees, assessments or other charges being referred to collectively as “Taxes”).  If any Taxes are so levied or imposed, the relevant Borrower agrees to pay the full amount of such Taxes, and such additional amounts as may be necessary so that every payment of all amounts due under this Agreement or under any Note, after withholding or deduction for or on account of any Taxes, will not be less than the amount provided for herein or in such Note.  If any amounts are payable in respect of Taxes pursuant to the preceding sentence, the relevant Borrower agrees to reimburse each Lender lending to such Borrower, upon the written request of such Lender, for taxes imposed on or measured by the net income or net profits of such Lender
pursuant to the laws of the jurisdiction in which such Lender is organized or in which the principal office or applicable lending office of such Lender is located or under the laws of any political subdivision or taxing authority of any such jurisdiction in which such Lender is organized or in which the principal office or applicable lending office of such Lender is located and for any withholding of taxes as such Lender shall determine are payable by, or withheld from, such Lender, in respect of such amounts so paid to or on behalf of such Lender pursuant to the preceding sentence and in respect of any amounts paid to or on behalf of such Lender pursuant to this sentence.  Each Borrower will furnish to the Administrative Agent within 45 days after the date the payment of any Taxes is due pursuant to applicable law certified copies of tax receipts (or if it has been established to the satisfaction of the applicable taxing authority that it is impossible to furnish such receipts, such
other evidence reasonably satisfactory to the Administrative Agent) evidencing such payment by the Borrower.  Each Borrower agrees to indemnify and hold harmless each Lender, and reimburse such Lender 

 

 

	
             
 	
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upon its written request, for the amount of any Taxes so levied or imposed and paid by such Lender.

(b)        Each Lender that is not a United States person (as such term is defined in Section 7701(a)(30) of the Code) for U.S. Federal income tax purposes agrees to deliver to each Borrower organized under the laws of the United States (“U.S. Borrower”) and the Administrative Agent on or prior to the Restatement Effective Date, or in the case of a Lender that is an assignee or transferee of an interest under this Agreement pursuant to Section 1.14 or 12.04 (unless the respective Lender was already a Lender hereunder immediately prior to such assignment or transfer), on the date of such assignment or transfer to such Lender, (i) two accurate and complete original signed copies of Internal Revenue Service Form W-8ECI or Form W-8BEN (with respect to a complete exemption under an income tax treaty) (or successor forms) certifying to such
Lender’s entitlement as of such date to a complete exemption from United States withholding tax with respect to payments to be made under this Agreement and under any Note, or (ii) if the Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code and cannot deliver either Internal Revenue Service Form W-8ECI or Form W-8BEN (with respect to a complete exemption under an income tax treaty) pursuant to clause (i) above, (x) a certificate substantially in the form of Exhibit C (any such certificate, a “Section 4.04(b)(ii) Certificate”) and (y) two accurate and complete original signed copies of Internal Revenue Service Form W-8BEN (with respect to the portfolio interest exemption)(or successor form) certifying to such Lender’s entitlement to a complete exemption from United States withholding tax with respect to payments of interest to be made under this Agreement and under any Note.  In addition, each Lender agrees that from time to time
after the Restatement Effective Date, when a lapse in time or change in circumstances renders the previous certification obsolete or inaccurate in any material respect, it will deliver to the U.S. Borrower and the Administrative Agent two new accurate and complete original signed copies of Internal Revenue Service Form W-8ECI, Form W-8BEN (with respect to the benefits of any income tax treaty), or Form W-8BEN (with respect to the portfolio interest exemption) and a Section 4.04(b)(ii) Certificate, as the case may be, and such other forms as may be required in order to confirm or establish the entitlement of such Lender to a continued exemption from or reduction in United States withholding tax with respect to payments under this Agreement and any Note, or it shall immediately notify the U.S. Borrower and the Administrative Agent of its inability to deliver any such Form or Certificate, in which case such Lender shall not be required to deliver any such Form or Certificate pursuant to
this Section 4.04(b).  Notwithstanding anything to the contrary contained in Section 4.04(a), but subject to Section 12.04(b) and the immediately succeeding sentence, (x) each U.S. Borrower shall be entitled, to the extent it is required to do so by law, to deduct or withhold income or similar taxes imposed by the United States (or any political subdivision or taxing authority thereof or therein) from interest, Fees or other amounts payable hereunder for the account of any Lender which is not a United States person (as such term is defined in Section 7701(a)(30) of the Code) for U.S. Federal income tax purposes to the extent that such Lender has not provided to the U.S. Borrower U.S. Internal Revenue Service Forms that establish a complete exemption from such deduction or withholding and (y) the U.S. Borrower shall not be obligated pursuant to Section 4.04(a) hereof to gross-up payments to be made to a Lender in respect of income or similar taxes imposed by the United States if (I)
such Lender has not provided to the U.S. Borrower the Internal Revenue Service Forms required to be provided to the U.S. Borrower pursuant to this Section 4.04(b) or (II) in the case of a payment, other than interest, to a Lender described in clause (ii) above, to the extent that such Forms do not establish a complete 

 

 

	
             
 	
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exemption from withholding of such taxes.  Notwithstanding anything to the contrary contained in the preceding sentence or elsewhere in this Section 4.04 and except as set forth in Section 12.04(b), each Borrower agrees to pay any additional amounts and to indemnify each Lender in the manner set forth in Section 4.04(a) (without regard to the identity of the jurisdiction requiring the deduction or withholding) in respect of any Taxes deducted or withheld by it as described in the immediately preceding sentence as a result of any changes that are effective after the Restatement Effective Date in any applicable law, treaty, governmental rule, regulation, guideline or order, or in the interpretation thereof, relating to the deducting or withholding of such Taxes.

(c)        Each Lender agrees to use reasonable efforts (consistent with legal and regulatory restrictions and subject to overall policy considerations of such Lender) to file any certificate or document or to furnish to a Borrower that is not a U.S. Borrower any information as reasonably requested by such Borrower that may be necessary to establish any available exemption from, or reduction in the amount of, any Taxes; provided, however, that nothing in this Section 4.04(c) shall require a Lender to disclose any confidential information (including, without limitation, its tax returns or its Tax calculations). A Borrower that is not a U.S. Borrower shall not be obligated pursuant to Section 4.04(a) hereof to gross-up payments to be made to a Lender in
respect of income or similar taxes imposed if such Lender has not used reasonable efforts to provide a certificate, document or information to the extent required pursuant to this Section 4.04(c).

(d)        If the Borrower pays any additional amount under this Section 4.04 and such Lender determines in its sole discretion that it has actually received in connection therewith any refund of its Tax liabilities in or with respect to the taxable year in which the additional amount is paid (a “Tax Refund”), such Lender shall pay to the Borrower an amount that the Lender shall, in its sole discretion, determine is equal to the net benefit, after tax, which was obtained by the Lender in such year as a consequence of such Tax Refund; provided, however, that (i) any Lender may determine, in its sole discretion consistent with the policies of such Lender, whether to seek a Tax Refund; (ii) any Taxes that are imposed on a Lender as a result of a
disallowance or reduction (including through the expiration of any tax credit carryover or carryback of such Lender that otherwise would not have expired) of any Tax Refund with respect to which such Lender has made a payment to the Borrower pursuant to this Section 4.04(d) shall be treated as a Tax for which the Borrower is obligated to indemnify such Lender pursuant to this Section 4.04 without any exclusions or defenses; (iii) nothing in this Section 4.04(d) shall require the Lender to disclose any confidential information to the Borrower (including, without limitation, its tax returns); and (iv) no Lender shall be required to pay any amounts pursuant to this Section 4.04(d) at any time during which a Default or Event of Default exists.

SECTION 5.  Conditions Precedent. 

5.01      Conditions Precedent to Restatement Effective Date.  This Agreement shall become effective on the date (the “Restatement Effective Date”) on which each of the following conditions shall be satisfied:

(a)        Execution of Agreement; Notes.  (i) Each of the Company, the initial Designated Subsidiary Borrowers, the Administrative Agent and each of the Lenders shall have 

 

 

	
             
 	
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signed a copy hereof (whether the same or different copies) and shall have delivered the same to the Administrative Agent at its Notice Office or, in the case of the Lenders and the Agents, shall have given to the Administrative Agent telephonic (confirmed in writing), written or facsimile transmission notice (actually received) at such office that the same has been signed and mailed to it; and (ii) there shall have been delivered to the Administrative Agent for the account of each Lender requesting the same, Notes executed by each Borrower, as applicable, in each case in the amount, maturity and as otherwise provided herein.

(b)        No Default; Representations and Warranties.  The Administrative Agent shall have received a certificate, dated the Restatement Effective Date, signed by an Authorized Officer of the Company certifying that (i) no Default or Event of Default exists and (ii) all representations and warranties made by each Borrower contained herein or in any other Credit Document are true and correct in all material respects.

(c)        Corporate Proceedings.  (i)The Administrative Agent shall have received from each Borrower a certificate, dated the Restatement Effective Date, signed by an Authorized Officer thereof in the form of Exhibit E with appropriate insertions and deletions, together with (x) copies of its certificate of incorporation, by-laws or other organizational documents (or, if such organizational documents and/or by-laws have not been amended, modified or supplemented since the Original Effective Date such certificate shall certify that there have been no amendments, modifications or supplements to such organizational documents since the Original Effective Date) and (y) the resolutions relating to the Credit Documents which shall be satisfactory to the Administrative Agent.

(ii)         The Administrative Agent shall have received all information and copies of all certificates, documents and papers, including good standing certificates and any other records of corporate proceedings and governmental approvals, if any, which the Administrative Agent may have requested in connection therewith, such documents and papers, where appropriate, to be certified by proper corporate or governmental authorities.

(d)        A.M. Best Rating.  On the Restatement Effective Date, each Regulated Insurance Company which is a Material Subsidiary and which has an A.M. Best financial strength rating shall have an A.M. Best financial strength rating of at least A-.

(e)        Opinions of Counsel.  The Administrative Agent shall have received legal opinions reasonably acceptable to the Administrative Agent and addressed to the Administrative Agent and each of the Lenders and dated the Restatement Effective Date, from (a) Marc Wetherhill, Esq., Corporate Counsel of the Company, substantially in the form of Exhibit D-1, (b) Cathy A. Hauck, Esq., Executive Vice President, General Counsel and Corporate Secretary of Partner Reinsurance Company of the U.S. substantially in the form of Exhibit D-2, (c) Davis Polk & Wardwell, substantially in the form of Exhibit D-3, Davis Polk & Wardwell (Paris), substantially in the form of Exhibit D-4 and (d) A&L Goodbody Solicitors, substantially in the form of Exhibit D-5. 

(f)         Fees.  The Borrowers shall have paid to the Administrative Agent and the Lenders all fees, expenses (including, without limitation, legal fees and expenses) and other 

 

 

	
             
 	
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compensation contemplated by this Agreement and the other Credit Documents, agreed upon by such parties to be paid on or prior to such date.

(g)        Repayment under the Existing Credit Agreement.  On the Restatement Effective Date, all loans under the Existing Credit Agreement shall have been repaid in cash in full, together with all accrued interest and fees thereon, all letters of credit (other than the Existing Fronted Letters of Credit and Existing Several Letters of Credit, if any) issued thereunder shall have been terminated, and all other amounts owing pursuant to the Existing Credit Agreement shall have been repaid in full.  The Administrative Agent shall have received evidence in form, scope and substance reasonably satisfactory to it that the matters set forth in this Section 5.01(g) have been satisfied on such date.

(h)        Non-Continuing Lender Agreement.  On the Restatement Effective Date, any Existing Lender that will not be a Lender under this Agreement shall have executed a Non-Continuing Lender Agreement.

The occurrence of the Restatement Effective Date shall constitute a representation and warranty by each Borrower to the Agents and each of the Lenders that (i) all the conditions specified in Section 5.01 exist as of that time and (ii) the representation and warranty set forth in Section 6.04(b) is true and correct in all material respects as of such date.  All the Notes, certificates, legal opinions and other documents and papers referred to in this Section 5.01, unless otherwise specified, shall be delivered to the Administrative Agent at the Administrative Agent’s Notice Office for the account of each of the Lenders and, except for the Notes, in sufficient counterparts for each of the Lenders and shall be satisfactory in form and substance to the Lenders.  The Administrative Agent shall give the Company and each Lender written notice that the Restatement Effective Date has occurred.

5.02      Conditions Precedent to All Loans and Letters of Credit.  The obligation of each Lender to make any Loan and the obligation of each LC Issuer to issue or increase the Stated Amount of any Letter of Credit is subject, at the time of each such Loan made or Letter of Credit issued or increased, to the satisfaction of the following conditions:

(a)        Restatement Effective Date.  The Restatement Effective Date shall have occurred.

(b)        Notice of Borrowing.  The Administrative Agent shall have received, as applicable, (i) a Notice of Borrowing meeting the requirements of Section 1.03(a) with respect to each incurrence of Revolving Loans, (ii) a Notice of Competitive Bid Borrowing meeting the requirements of Section 1.04(a) with respect to each incurrence of Competitive Bid Loans or (iii) a Letter of Credit Request meeting the Requirements of Section 2.04 with respect to each Letter of Credit to be issued. 

(c)        No Default; Representations and Warranties.  At the time of the incurrence of each Loan or issuance or increase in any Letter of Credit, and also after giving effect thereto, (i) there shall exist no Default or Event of Default, (ii) all representations and warranties made by each Borrower contained herein or in any other Credit Documents (other than the representation and warranty made in Section 6.04(b)) shall be true and correct in all material respects with 

 

 

	
             
 	
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the same effect as though such representations and warranties had been made on and as of the date of such Loan and (iii) as of the date of the most recently required Annual Compliance Certificate the representation and warranty made in Section 6.04(b) was true and correct in all material respects.  

The acceptance of the benefits of each Loan and Letter of Credit shall constitute a representation and warranty by the respective Borrower to the Agents and each of the Lenders that all of the applicable conditions specified in Section 5.02 exist as of that time.

SECTION 6.  Representations, Warranties and Agreements.  In order to induce the Lenders to enter into this Agreement and to make the Loans and issue Letters of Credit provided for herein, the Company makes the following representations and warranties to, and agreements with, the Lenders, all of which shall survive the execution and delivery of this Agreement and the making of the Loans and the issuance of any Letter of Credit:

6.01      Corporate Existence and Power.  (a)  Each of the Company and its Subsidiaries is a corporation duly organized, validly existing and, to the extent applicable, in good standing under the laws of the jurisdiction of its incorporation, is duly qualified to transact business in every jurisdiction where, such qualification is necessary except where the failure to be so qualified would not reasonably be expected to have a Material Adverse Effect, and (b) each of the Company and its Subsidiaries has all corporate powers and all governmental licenses, authorizations, consents and approvals required to carry on its businesses as now conducted except where the failure to have such governmental licenses, authorizations, consents and approvals would not reasonably be expected to have a Material Adverse Effect.

6.02      Corporate and Governmental Authorization; No Contravention.  The execution, delivery and performance by the Borrowers of this Agreement and the other Credit Documents, (i) are within each of the Borrower’s corporate powers, (ii) have been duly authorized by all necessary corporate action and if required, by all necessary shareholder action, (iii) require no consent approval of (including any exchange control approval) or action by or in respect of, or registration or filing with, any Governmental Authority, agency or official, except such as have been obtained or made and are in full force and effect, (iv) do not contravene, or constitute a default under, any provision of applicable law, regulation or order of any Governmental Authority, the charter, by-laws or other organizational documents of any of the Borrowers or of
any judgment, injunction, order or decree binding upon the Borrowers or any of their Subsidiaries, (v) do not result in the creation or imposition of any Lien on any asset of the Borrowers or any of their Subsidiaries and (vi) will not violate or result in a default under any indenture, loan agreement or other material agreement or instrument binding upon the Borrowers or their assets, or give rise to a right thereunder to require any payment to be made by any such Person.

6.03      Enforceability.  Each Credit Document constitutes a legal, valid and binding agreement of each of the Borrowers enforceable against each of the Borrowers in accordance with its terms, and the other Credit Documents, when executed and delivered in accordance with this Agreement, will constitute valid and binding obligations of each of the Borrowers enforceable in accordance with their respective terms, provided that the enforceability 

 

 

	
             
 	
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hereof and thereof is subject in each case to general principles of equity and to bankruptcy, insolvency and similar laws affecting the enforcement of creditors’ rights generally.

6.04      Financial Information.  (a)The consolidated balance sheet of the Company and its Consolidated Subsidiaries as of December 31, 2004 and the related consolidated statements of income, shareholders’ equity and cash flows for the Fiscal Year then ended, reported on by Deloitte & Touche copies of which have been delivered to each of the Lenders, and the unaudited consolidated financial statements of the Company and its Consolidated Subsidiaries for the fiscal quarter ended June 30, 2005, copies of which have been delivered to each of the Lenders, fairly present, in conformity with GAAP consistently applied, the consolidated financial position and results of operations and cash flows of the Company and its Consolidated Subsidiaries as of such dates and their consolidated results of operations and cash flows for such
periods stated, subject to normal year-end audit adjustments and the absence of footnotes in the case of such unaudited financial statements.

(b)        Since December 31, 2004, there has been no event, act, condition or occurrence that has had or is reasonably likely to have a Material Adverse Effect.

6.05      Litigation.  There is no action, suit or proceeding pending or threatened against or affecting the Company or any of its Subsidiaries before any court or arbitrator or any Governmental Authority, agency or official which is reasonably likely to have a Material Adverse Effect or which in any manner draws into question the validity or enforceability of, or which is reasonably likely to impair the ability of the Borrowers to perform their obligations under, this Agreement or any of the other Credit Documents.

6.06      Tax Returns and Payments.  (a)Each of the Borrower and each of its Subsidiaries has filed all material federal income tax returns and all other material tax returns, domestic and foreign, required to be filed by it and has paid all material taxes and assessments payable by it which have become due, except for those contested in good faith and adequately disclosed and fully provided for on the financial statements of the Borrower and its Subsidiaries in accordance with GAAP principles.  The Borrower and each of its Subsidiaries have at all times paid, or have provided adequate reserves (in the good faith judgment of the management of the Borrower) for the payment of, all federal, state and foreign income taxes applicable for all prior fiscal years and for the current fiscal year to date.  There is no material action, suit,
proceeding, investigation, or claim now pending or, to the knowledge of the Borrower or any of its Subsidiaries, threatened by any authority regarding any taxes relating to the Borrower or any of its Subsidiaries.  Neither the Borrower nor any of its Subsidiaries has entered into an agreement or waiver or been requested to enter into an agreement or waiver extending any statute of limitations relating to the payment or collection of taxes of the Borrower or any of its Subsidiaries, or is aware of any circumstances that would cause the taxable years or other taxable periods of the Borrower or any of its Subsidiaries not to be subject to the normally applicable statute of limitations.

(b)To ensure the legality, validity, enforceability or admissibility in evidence of this Agreement or any Notes evidencing Loans made (or to be made), it is not necessary that any stamp or similar tax be paid on or in respect of this Agreement or such Notes, or any other document other than such stamp or similar taxes that have already been paid.

 

 

	
             
 	
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6.07      Indebtedness.  The Company does not have any Debt on the Restatement Effective Date other than that which is listed on Annex IV.

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

6.09      Intellectual Property.  The Company and its Subsidiaries own, or are licensed to use, all trademarks, tradenames, copyrights, patents and other intellectual property material to their business, and the use thereof by the Company and/or its Subsidiaries does not infringe upon the rights of any other Person, except for any such infringements that, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.

6.10      Not an Investment Company.  Neither the Company nor any of its Subsidiaries is an “investment company” within the meaning of the Investment Company Act of 1940, as amended.

6.11      Public Utility Holding Company Act.  Neither the Company nor any of its Subsidiaries is a “holding company”, or a “subsidiary company” of a “holding company”, or an “affiliate” of a “holding company” or of a “subsidiary company” of a “holding company”, as such terms are defined in the Public Utility Holding Company Act of 1935, as amended.

6.12      Ownership of Property; Liens.  The Company and its Subsidiaries have good and valid title to, or a valid leasehold interest in, all of their real and personal properties sufficient for the conduct of their respective businesses and none of such property is subject to any Lien except as permitted in Section 8.01.

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

6.14      Full Disclosure.  All information heretofore furnished by the Borrowers to the Administrative Agent or any Lender for purposes of or in connection with this Agreement or any transaction contemplated hereby is, and all such information hereafter furnished by the Borrowers to the Administrative Agent or any Lender will be, true, accurate and complete in all material respects on the date as of which such information is stated or certified, provided that, with respect to projected financial information, the Borrowers represent only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time.

6.15      Compliance with Laws.  The Company and each of its Subsidiaries is in compliance with all applicable laws, regulations, rules and orders of any Governmental Authority, except where any failure to comply with any such laws would not reasonably be expected to, alone or in the aggregate, have a Material Adverse Effect.

 

 

	
             
 	
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6.16      Capital Stock.  All Capital Stock, debentures, bonds, notes and all other securities of the Company and its Subsidiaries presently issued and outstanding have been validly and properly issued in accordance with all applicable laws, including, but not limited to, the “Blue Sky” laws of all applicable states and the federal securities laws.  The issued shares of Capital Stock of each of the Company’s Wholly-Owned Subsidiaries are owned by the Company free and clear of any Lien or adverse claim.  

6.17      Compliance with ERISA.  (a)Each Borrower and its Subsidiaries and ERISA Affiliates have fulfilled their respective obligations (if any) under the minimum funding standards of ERISA and the Code with respect to each Plan and are in compliance in all material respects with the applicable provisions of ERISA and the Code, and have not incurred any liability to the PBGC or any Plan or Multiemployer Plan (other than to make contributions in the ordinary course of business).

(b)        Each Foreign Pension Plan has been maintained in substantial compliance with its terms and with the requirements of any and all applicable laws, statutes, regulations and orders and has been maintained, where required, in good standing with applicable regulatory authorities.  All contributions required to be made with respect to a Foreign Pension Plan have been timely made.  Neither the Borrower nor any of its Subsidiaries has incurred any obligation in connection with the termination of, or withdrawal from, any Foreign Pension Plan.  The present value of the accrued benefit liabilities (whether or not vested) under each Foreign Pension Plan, determined as of the end of the Borrower’s most recently ended fiscal year on the basis of actuarial assumptions, each of which is reasonable, did not exceed the current value of the assets of
such Foreign Pension Plan allocable to such benefit liabilities.

6.18      Margin Stock.  No Borrower nor any of its Subsidiaries is engaged principally in the business of purchasing or carrying any Margin Stock, and no part of the proceeds of any Loan hereunder will be used to purchase or carry any Margin Stock, or be used for any purpose which violates, or which is inconsistent with the provisions of Regulation U or X.

6.19      Subsidiaries.  Set forth in Annex III is a complete and correct list of all of the Subsidiaries of the Company as of the Restatement Effective Date, together with, for each such Subsidiary, (i) the jurisdiction of organization of such Subsidiary, (ii) each Person holding direct ownership interests in  such Subsidiary and (iii) the percentage of ownership of such Subsidiary represented by such ownership interests.  Except as disclosed in Annex III, as of the Restatement Effective Date (y) each of the Company and its Subsidiaries owns, free and clear of Liens, and has the unencumbered right to vote, all outstanding ownership interests in each Person shown to be held by it in Annex III and (z) all of the issued and outstanding Capital Stock of each such Person organized as a corporation is validly issued, fully paid and nonassessable.

6.20      Use of Proceeds.  All proceeds of the Loans shall be utilized for the general corporate purposes of the Company and its Subsidiaries.  All Letters of Credit shall be used to support obligations of the Company and the Subsidiaries permitted under the Agreement.

SECTION 7.  Affirmative Covenants.  The Borrowers hereby covenant and agree that on and as of the Restatement Effective Date and thereafter until the Commitments have 

 

 

	
             
 	
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terminated, no Letters of Credit or Notes are outstanding and the Loans and Unpaid Drawings, together with interest, Fees and all other obligations (other than any indemnities described in Section 12.12 which are not then owing) incurred hereunder, are paid in full:

	
            7.01
 	
            Information Covenants.  The Company will furnish to each Lender:
 

(a)        as soon as available and in any event within 45 days after the end of each of the first three quarterly fiscal periods in each Fiscal Year of the Company, a consolidated balance sheet of the Company and its Subsidiaries as at the end of such period and the related consolidated statements of income, changes in stockholders' equity and cash flows of the Company for such period and (in the case of the second and third quarterly periods) for the period from the beginning of the current Fiscal Year to the end of such quarterly period, setting forth in each case in comparative form the consolidated figures for the corresponding periods of the previous Fiscal Year, all in reasonable detail and certified by an Authorized Officer of the Company as presenting fairly, in accordance with GAAP (except as specifically set forth
therein; provided any exceptions or qualifications thereto must be acceptable to the Required Lenders) on a basis consistent with such prior fiscal periods, the information contained therein, subject to changes resulting from normal year-end audit adjustments;

(b)        as soon as available and in any event within 90 days after the end of each Fiscal Year of the Company, the consolidated balance sheet of the Company and its Subsidiaries as at the end of such year and the related consolidated statements of income, operations, changes in stockholders' equity and cash flows of the Company for such Fiscal Year, setting forth in comparative form the consolidated figures for the previous fiscal year, all in reasonable detail and accompanied by a report thereon of Deloitte & Touche or other independent public accountants of recognized national standing selected by the Company, which report shall state that such consolidated financial statements present fairly the consolidated financial position of each of the Company and its Subsidiaries as at the dates indicated and the consolidated
results of its operations and cash flows for the periods indicated in conformity with GAAP applied on a basis consistent with prior years (except as otherwise specified in such report; provided any exceptions or qualifications thereto must be acceptable to the Required Lenders) and that the audit by such accountants in connection with such consolidated financial statements has been made in accordance with generally accepted auditing standards;

(c)        within five Business Days after any senior officer of any Borrower becomes aware of the occurrence of any Default and/or any event or condition constituting, or which in such Borrower’s reasonable judgment is reasonably likely to have a Material Adverse Effect, a certificate of an Authorized Officer of each of the Borrowers setting forth the details thereof and the action which the Borrowers are taking or propose to take with respect thereto;

(d)        promptly upon the mailing thereof to the security holders of the Borrowers generally, copies of all financial statements, reports and proxy statements so mailed;

 

 

	
             
 	
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(e)        promptly upon the filing thereof, copies of all registration statements (other than the exhibits thereto and any registration statements on Form S-8 or its equivalent) and annual, quarterly or monthly reports which the Company shall have filed with the Securities and Exchange Commission or any national securities exchange;

(f)         promptly after any Borrower knows of the commencement thereof, notice, of any litigation, dispute or proceeding involving a claim against any of the Borrowers and/or any Subsidiary which claim could reasonably be expected to have a Material Adverse Effect;

(g)        at the request of any Lender, promptly after the filing thereof, a copy of the annual statements for each calendar year and quarterly statements for each calendar quarter (if any) as filed with any Applicable Insurance Regulatory Authority of any jurisdiction in which any Regulated Insurance Company is qualified to do business;

(h)        at the time of the delivery of the financial statements provided for in Sections 7.01(a) and (b), a compliance certificate from the chief financial officer or treasurer of the Company in the form of Exhibit K (I) certifying on behalf of the Company that, to the best of such officer’s knowledge after due inquiry, no Default or Event of Default has occurred and is continuing or, if any Default or Event of Default has occurred and is continuing, specifying the nature and extent thereof and (II) setting forth in reasonable detail the calculations required to establish whether the Company and its Subsidiaries were in compliance with the provisions of Sections 8.10 and 8.11; and

(i)         from time to time such additional information regarding the financial position or business of the Borrowers and their Subsidiaries as the Administrative Agent, at the request of any Lender, may reasonably request.

Reports and financial statements required to be delivered by the Company pursuant to paragraphs (a), (b) and (e) of this Section 7.01 shall be deemed to have been delivered on the date on which the Company posts such reports, or reports containing such financial statements, on its website on the Internet at www.partnerre.com or when such reports, or reports containing such financial statements are posted on the SEC’s website at www.sec.gov; provided that the Company shall deliver paper copies of the reports and financial statements referred to in paragraphs (a), (b) and (e) of this Section 7.01 to the Administrative Agent or any Lender who requests it to deliver such paper copies until written notice to cease delivering paper copies is given by the Administrative Agent or such Lender.

7.02      Books, Records and Inspections.  The Borrowers will (i) keep, and will cause each Subsidiary to keep, proper books of record and account in which full, true and correct entries in conformity with GAAP or Statutory Accounting Principles, as applicable, shall be made of all dealings and transactions in relation to its business and activities; and (ii) permit, and will cause each Subsidiary to permit, representatives of any Lender at such Lender’s expense prior to the occurrence and during the continuance of an Event of Default and at the Borrowers’ expense after the occurrence of an Event of Default to visit and inspect any of their respective properties, to examine their respective books and records and to discuss their respective affairs, finances and accounts with their respective officers, employees and
independent public 

 

 

	
             
 	
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accountants.  The Borrowers agree to cooperate and assist in such visits and inspections, in each case at such reasonable times and as often as may reasonably be desired.

7.03      Maintenance of Existence.  Each of the Borrowers shall maintain its existence, and will qualify and remain qualified as a foreign corporation in each jurisdiction in which failure to receive or retain such qualifications would have a Material Adverse Effect. 

7.04      ERISA.  As soon as possible and, in any event, within (10) days after a Borrower, any of its Subsidiaries or any of its ERISA Affiliates knows or has reason to know that any of the events or conditions specified below with respect to any Plan or Multiemployer Plan have occurred or exist, a statement signed by the chief financial officer of such Borrower setting forth details respecting such event or condition and the action if any, that such Borrower, such Subsidiary or such ERISA Affiliate proposes to take with respect thereto (and a copy of any report or notice required to be filed with or given to PBGC by such Borrower, such Subsidiary or such ERISA Affiliate with respect to such event or condition):

(i)         any reportable event, as defined in subsections (c)(1), (2), (5) and (6), and subsection (d)(2) of Section 4043 of ERISA and the regulations issued thereunder, with respect to a Plan;

(ii)         the filing under Section 4041(c) of ERISA of a notice of intent to terminate any Plan under a distress termination or the distress termination of any Plan;

(iii)        the institution by PBGC of proceedings under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan, or the receipt by a Borrower, any of its Subsidiaries or any of its ERISA Affiliates of a notice from a Multiemployer Plan that such action has been taken by PBGC with respect to such Multiemployer Plan;

(iv)        the receipt by a Borrower, any of its Subsidiaries or any of its ERISA Affiliates of notice from a Multiemployer Plan that a Borrower, any of its Subsidiaries or any of its ERISA Affiliates has incurred withdrawal liability under Section 4201 of ERISA in excess of $10,000,000 or that such Multiemployer Plan is in reorganization or insolvency pursuant to Section 4241 or 4245 of ERISA or that it intends to terminate or has terminated under Section 4041A of ERISA whereby a deficiency or additional assessment is levied or threatened to be levied against a Borrower, any of its Subsidiaries or any of its ERISA Affiliates; and

(v)        the institution of a proceeding by a fiduciary of any Plan or Multiemployer Plan against a Borrower, any of its Subsidiaries or any of its ERISA Affiliates to enforce Section 515 or 4219(c)(5) of ERISA, which proceeding is not dismissed within 30 days.

7.05      Insurance.  The Borrowers will maintain, and will cause each of their Subsidiaries to maintain (either in the name of the Borrowers or in such Subsidiary’s own name) with financially sound and reputable insurance companies, insurance on all their property in at least such amounts and against at least such risks as are usually insured against in the same general area by companies of established repute engaged in the same or similar businesses.

 

 

	
             
 	
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7.06      Maintenance of Property.  The Borrowers shall, and will cause each of their Subsidiaries to, maintain all of their properties and assets in good condition, repair and working order, ordinary wear and tear excepted.

7.07      Payment of Taxes.  Each Borrower will pay and discharge, and will cause each of its Subsidiaries to pay and discharge, all taxes, assessments and governmental charges or levies imposed upon it or upon its income or profits, or upon any properties belonging to it, prior to the date on which penalties attach thereto, and all lawful claims for sums that have become due and payable which, if unpaid, might become a Lien not otherwise permitted under Section 8.01;  provided, that neither the Borrower nor any of its Subsidiaries shall be required to pay any such tax, assessment, charge, levy or claim which is being contested in good faith and by proper proceedings if it has maintained adequate reserves with respect thereto in accordance with GAAP.

7.08      Patriot Act.  The Company and each Designated Subsidiary Borrower will comply with all requests made in accordance with Section 12.19.

SECTION 8.  Negative Covenants.  The Borrowers hereby covenant and agree that on and as of the Restatement Effective Date and thereafter until the Commitments have terminated, no Letters of Credit or Notes are outstanding and the Loans and Unpaid Drawings, together with interest, Fees and all other obligations (other than any indemnities described in Section 12.12 which are not then owing) incurred hereunder, are paid in full:

8.01      Liens.  Neither the Company nor any of its Subsidiaries will permit, create, assume, incur or suffer to exist any Lien on any asset tangible or intangible now owned or hereafter acquired by it, except:

	
            (i)
 	
            Liens existing on the date hereof and listed on Annex V hereto;
 

(ii)         Liens not securing Debt which are incurred in the ordinary course of business;

(iii)        Liens securing repurchase agreements constituting a borrowing of funds by the Company or any Subsidiary of the Company in the ordinary course of business for liquidity purposes and in no event for a period exceeding 90 days in each case; and

(iv)        Liens existing on any asset of any Person at the time such Person becomes a Subsidiary and not created in contemplation of such event;

(v)        Liens on any asset securing Debt incurred or assumed for the purpose of financing all or any part of the cost of acquiring such asset, provided that such Lien attaches to such asset concurrently with or within 90 days after the acquisition thereof;

(vi)        Liens on any asset of any Person existing at the time such Person is merged or consolidated with or into the Company or a Subsidiary and not created in contemplation of such event;

 

 

	
             
 	
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(vii)       Liens existing on any asset prior to the acquisition thereof by the Company or a Subsidiary and not created in contemplation of such acquisition;

(viii)      Liens arising out of the refinancing, extension, renewal or refunding of any Debt secured by any Lien permitted by any of the foregoing clauses of this Section 8.01, provided that such Debt is not increased and is not secured by any additional assets;

(ix)        Liens securing obligations owed by any Borrower to any other Borrower or owed by any Subsidiary of the Company (other than a Borrower) to the Company or any other Subsidiary;

(x)        Liens incurred in the ordinary course of business in favor of financial intermediaries and clearing agents pending clearance of payments for investment or in the nature of set-off, banker’s lien or similar rights as to deposit accounts or other funds;

(xi)        Liens consisting of deposits made by any Regulated Insurance Company with an Applicable Insurance Regulatory Authority or other statutory Liens or Liens or claims imposed or required by applicable insurance laws or regulations against the assets of any Regulated Insurance Company, in each case in favor of policyholders of such Regulated Insurance Company or an Applicable Insurance Regulatory Authority and in the ordinary course of such Regulated Insurance Company’s business;

(xii)       Judgment or judicial attachment Liens, provided that no Event of Default arises under Section 9.01(k); 

(xiii)      Liens, now or in the future, arising in the ordinary course of business of (and solely on assets of) New Solutions or any other Subsidiary securing the obligations of New Solutions or such other Subsidiary, as the case may be; provided that (A) New Solutions or such other Subsidiary is not a Borrower or a Regulated Insurance Company and (B) New Solutions or such Subsidiary is primarily in the business of dealing in securities interest rate swaps and other derivative transactions; and 

(xiv)      Liens not otherwise permitted by the foregoing clauses of this Section 8.01 securing Debt in an aggregate principal amount not at any time exceeding 12% of Consolidated Tangible Net Worth.

8.02      Dissolution.  No Borrower shall suffer or permit dissolution or liquidation either in whole, except through corporate reorganization to the extent permitted by Section 8.03.

8.03      Consolidations, Mergers, Sales of Assets and Acquisitions.  (a)  The Borrowers will not consolidate or merge with or into any other Person, provided that (i) any Borrower may merge with another Person if (x) one of the Borrowers is the corporation surviving such merger or, if such Person is the survivor, such Person is a corporation or company organized and existing under the laws of the United States of America, any state thereof or the District of Columbia, Bermuda or any country which is, on the date of such merger, a member of the Organization of Economic Cooperation and Development, such Person will expressly and unconditionally assume the due and punctual payment of the principal of, any premium and interest on and other amounts of such Borrower hereunder, and the performance of such 

 

 

	
             
 	
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Borrower’s obligations hereunder and such Person delivers an opinion from counsel in the jurisdiction of such person’s organization in form and substance satisfactory to the Administrative Agent covering matters in connection with such consolidation or merger, and (y) immediately after giving effect to such merger, no Default or Event of Default shall have occurred and be continuing; and (ii) Subsidiaries of the Company may merge with one another (subject, in the case of mergers involving Designated Subsidiary Borrowers, to compliance with the requirements of preceding clause (x)).

(b)        No Borrower will, nor will it permit any of its Subsidiaries to, sell, convey, assign, lease, abandon or otherwise transfer or dispose of, voluntarily or involuntarily (any of the foregoing  (subject to the exclusions hereinafter set forth) being referred to in this Section as a “Disposition”), any of its properties or assets, tangible or intangible (including but not limited to any sale, assignment, discount or other disposition of accounts, contract rights, chattel paper or general intangibles with or without recourse, but excluding (i) restricted payments permitted under Section 8.08 below, (ii) sales of portfolio securities in the ordinary course of business and (iii) cash payments to discharge obligations or for goods or services or to acquire assets), provided that the Borrowers and their Subsidiaries may make
Dispositions in any fiscal year so long as the aggregate amount of such Dispositions made in such fiscal year does not exceed $200,000,000.

(c)        No Borrower will, nor will it permit any of its Subsidiaries to, acquire all or substantially all of the capital stock or assets of another Person (other than a Person which is already a Wholly-Owned Subsidiary of such Borrower or Subsidiary) unless at such time and immediately after giving effect thereto no Default or Event of Default exists or would result therefrom.

8.04      Use of Proceeds.  Each Borrower will use the proceeds of all Loans for its general corporate purposes.  No portion of the proceeds of the Loans will be used by the Borrowers or any Subsidiary (i) directly or indirectly, for the purpose, whether immediate, incidental or ultimate, of purchasing or carrying any Margin Stock, or (ii) for any purpose in violation of any applicable law or regulation.

8.05      Transactions with Affiliates.  Neither the Company nor any of its Subsidiaries shall enter into or be a party to, any transaction with any Affiliate of the Company or such Subsidiary (which Affiliate is not one of the Borrowers or a Subsidiary), except transactions with Affiliates in good faith and on terms no less favorable to such Borrower or Subsidiary than those that could have been obtained in a comparable transaction on an arm’s length basis from an unrelated Person.

8.06      Indebtedness.  No Borrower will at any time create, incur, assume or permit to exist any Debt, or agree, become or remain liable (contingent or otherwise) to do any of the foregoing, except for Debt which is either pari passu with, or subordinated in right of payment to, the Obligations.

	
            8.07
 	
            Private Act.  No Borrower will become subject to a Private Act.
 

 

 

 

	
             
 	
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8.08      Restricted Payments.  The Company will not declare or pay any dividends, purchase, redeem, retire, defease or otherwise acquire for value any of its Equity Interests now or hereafter outstanding, return any capital to its stockholders, partners or members (or the equivalent Persons thereof) as such, make any distribution of assets, Equity Interests, obligations or securities to its stockholders, partners or members (or the equivalent Persons thereof) as such, or permit any of its Subsidiaries to purchase, redeem, retire, defease or otherwise acquire for value any Equity Interests in the Company, if in any case referred to above, a Default or Event of Default shall have occurred and be continuing at the time of such action or would result therefrom; provided that notwithstanding the foregoing, the Company may declare and pay dividends payable solely
in Equity Interests of the Company and may redeem, return or defease any of its Equity Interests by issuing new Equity Interests.

8.09      Business.  The Company will not, and will not permit any of its Subsidiaries to, engage (directly or indirectly) in any business other than substantially the same lines of business in which they are engaged on the Restatement Effective Date and reasonable extensions thereof and other businesses that are complimentary or reasonably related thereto.

8.10      Leverage Ratio.  The Company will not permit the ratio of Consolidated Total Debt to Consolidated Total Capitalization at any time to exceed 0.35:1.00.

8.11      Minimum Consolidated Tangible Net Worth.  The Company will not permit Consolidated Tangible Net Worth to be less than (i) during the period from and including the Restatement Effective Date to but not including the Financial Statement Delivery Date immediately following the Company’s fiscal quarter ending June 30, 2006, $2,100,000,000 and (ii) thereafter, an amount equal to the sum of (x) $2,100,000,000 plus (y) 50% of the Cumulative Consolidated Net Income (if positive) for the period from and including July 1, 2005 through the most recent June 30 or December 31 for which the Financial Statement Delivery Date has occurred.  

8.12      Claims Paying Ratings.  Each Regulated Insurance Company which is a Material Subsidiary and which has a financial strength rating from A.M. Best Co. (or its successor) will maintain at all times a financial strength rating of at least “A-” from A.M. Best & Co. (or its successor); provided that if the rating system of A.M. Best Co. (or its successors) shall change, or if it (or its successors) shall cease to be in the business of rating the financial strength of insurance companies like the Regulated Insurance Companies, the Company and the Lenders shall negotiate in good faith to amend the references to specific A.M. Best Co. ratings in this Agreement to reflect such changed rating system or the non-availability of ratings from such rating agency (it being understood that any such amendment to such specific ratings
shall in no event be effective without the approval of the Required Lenders).

SECTION 9.  Defaults.

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

(a)        any Borrower shall fail to pay when due any principal of any Loan, or shall fail to pay any interest on any Loan within three Business Days after such interest 

 

 

	
             
 	
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shall become due, or shall fail to pay any fee or other amount payable hereunder within five Business Days after such fee or other amount becomes due; or

(b)        any Borrower shall fail to observe or perform any covenant contained in Sections 7.01(c), 7.02(ii), 7.03, 7.06 or Section 8; or

(c)        any Borrower shall fail to observe or perform any covenant or agreement contained herein (other than those covered by clause (a) or (b) above) for 30 days after the earlier of (i) the first day on which any Borrower has knowledge of such failure or (ii) written notice thereof has been given to the Company by the Administrative Agent at the request of any Lender; or

(d)        any representation, warranty, certification or statement made or deemed made by any Borrower in Section 6 of this Agreement or in any certificate, financial statement or other document delivered pursuant to this Agreement shall prove to have been incorrect or misleading in any material respect when made (or deemed made); or

(e)        the Company or any Subsidiary shall default in any payment in respect of Debt outstanding in an aggregate principal amount equal to or in excess of $50,000,000 (other than the Obligations) (after giving effect to any applicable grace period); or

(f)         any event or condition shall occur which results in the acceleration of the maturity of any Debt outstanding in an aggregate amount equal to or in excess of $50,000,000 of the Company or any Subsidiary or the mandatory prepayment or purchase of such Debt by the Company (or its designee) or such Subsidiary (or its designee) prior to the scheduled maturity thereof; or

(g)        The Company or any Material Subsidiary shall commence a voluntary case or other proceeding seeking liquidation, reorganization, rehabilitation, conservation, supervision or other relief with respect to itself or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, rehabilitator, conservator, custodian or other similar official of them or any substantial part of their property, or shall consent to any such relief or to the appointment of or taking possession by any such official in an involuntary case or other proceeding commenced against them, or shall make a general assignment for the benefit of creditors, or shall fail generally, or shall admit in writing their inability, to pay their debts as they become due, or
shall take any corporate action to authorize any of the foregoing, or shall become or be declared by a court of competent jurisdiction to be insolvent; or

(h)        an involuntary case or other proceeding shall be commenced against the Company or any Material Subsidiary seeking liquidation, reorganization, rehabilitation, conservation, supervision or other relief with respect to them or their debts under any bankruptcy, insolvency or other similar law or the Bermuda Companies Law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, rehabilitator, conservator, custodian or other similar official of them or any substantial part of their property, and such involuntary case or other proceeding shall remain undismissed and 

 

 

	
             
 	
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unstayed for a period of 60 days; or an order for relief shall be entered against the Company or any Material Subsidiary under the federal bankruptcy laws as now or hereafter in effect;

(i)         an event or condition specified in Section 7.04 shall occur or exist with respect to any Plan or Multiemployer Plan, a Borrower, any of its Subsidiaries or any of its ERISA Affiliates shall fail to pay when due any material amount which they shall have become liable to pay to the PBGC or to a Plan or a Multiemployer Plan under Title IV of ERISA, or a condition shall exist by reason of which the PBGC would be entitled to obtain a decree adjudicating that any Plan must be terminated, and as a result of such event or condition, together with all such other events or conditions, a Borrower, any of its Subsidiaries or any of its ERISA Affiliates shall be reasonably likely in the opinion of the general counsel of such Borrower to incur a liability to a Plan, a Multiemployer Plan or PBGC (or any combination of the foregoing); or

(j)         the Company Guaranty shall terminate or cease, in whole or part, to be a legally valid and binding obligation of the Company or any Person acting for or on behalf of the Company shall contest such validity or binding nature of such Company Guaranty, or any other Person shall assert any of the foregoing;

(k)        one or more judgments or orders for the payment of money in an aggregate amount in excess of $50,000,000 shall be rendered  against the Company or any Subsidiary and such judgment or order shall continue unsatisfied and unstayed for a period of 30 days; or

	
            (l)
 	
            a Change of Control shall occur;
 

then, and in every such event, the Administrative Agent shall (i) if requested by the Required Lenders, by notice to the Company to terminate the Commitments and they shall thereupon terminate, (ii) if requested by the Required Lenders, by notice to the Company to declare the principal of and any accrued interest in respect of all Loans and all other Obligations owing hereunder and under the other Credit Documents to be, immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrowers, (iii) if requested by the Required Lenders, terminate any Letter of Credit or give a Notice of Non-Extension in respect thereof if permitted in accordance with its terms, and (iv) if requested by the Required Lenders, direct the applicable Borrower to pay (and the applicable Borrower hereby agrees upon receipt of such notice, or upon the occurrence
of any Event of Default specified in Section 9.01(g) and 9.01(h), to pay) to the Administrative Agent at the Payment Office an amount of cash to be held as security for respective Borrower’s reimbursement obligations in respect of all Letters of Credit then outstanding which were issued for the account of such Borrower, equal to the aggregate Stated Amount of all such Letters of Credit at such time; provided that if any Event of Default specified in clause (g) or (h) above occurs with respect to the Company without any notice to the Company or any other act by the Administrative Agent or the Lenders, the Total Commitment shall thereupon automatically terminate and the Notes (together with accrued interest thereon) and all other amounts payable hereunder and under the other Credit Documents shall automatically become immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are
hereby waived 

 

 

	
             
 	
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by the Borrowers. Notwithstanding the foregoing, the Administrative Agent shall have available to it all other remedies at law or equity, and shall exercise any one or all of them at the request of the Required Lenders.

9.02      Notice of Default.  The Administrative Agent shall give notice to the Company of any Default under Section 9.01(c) promptly upon being requested to do so by any Lender and shall thereupon notify all the Lenders thereof.

SECTION 10.  Definitions.  As used herein, the following terms shall have the meanings herein specified unless the context otherwise requires.  Defined terms in this Agreement shall include in the singular number the plural and in the plural the singular:

“Absolute Rate” shall mean an interest rate (rounded to the nearest .0001) expressed as a decimal.

“Absolute Rate Borrowing” shall mean a Competitive Bid Borrowing with respect to which a Borrower has requested that the Bidder Lenders offer to make Competitive Bid Loans at Absolute Rates.

“Additional Commitment” shall mean, for each Additional Commitment Lender, any commitment provided by such Additional Commitment Lender pursuant to Section 1.16, in such amount as agreed to by such Additional Commitment Lender in the respective Additional Commitment Agreement; provided that on the Additional Commitment Date upon which an Additional Commitment of any Additional Commitment Lender becomes effective, such Additional Commitment of such Additional Commitment Lender shall (x) in the case of an existing Lender be added to (and thereafter become a part of) the existing Commitment of such existing Lender for all purposes of this Agreement as contemplated by Section 1.16 and (y) in the case of a new Lender, be converted to a Commitment and become a Commitment for all purposes of this Agreement as contemplated by Section 1.16.

“Additional Commitment Agreement” shall mean an Additional Commitment Agreement substantially in the form of Exhibit L (appropriately completed).

“Additional Commitment Date” shall mean each date upon which an Additional Commitment under an Additional Commitment Agreement becomes effective as provided in Section 1.16.

“Additional Commitment Lender” shall have the meaning provided in Section 1.16(b)

“Additional Costs” shall mean, with respect to any Lender lending from an office in the United Kingdom or a Participating Member State, the amount notified by such Lender to the Borrowers and the Administrative Agent as its reasonable determination of the proportion of the cost attributable to the Loans made by such Lender from that office of complying with the fee and minimum reserve requirements of the Bank of England and the UK Financial Services Authority or the European Central Bank in respect of loans made from that office.

 

 

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

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

“Aggregate Loan Outstandings” shall have the meaning provided in Section 4.02(a).

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

“Alternate Currency” shall mean each Primary Alternate Currency and each Other Alternate Currency.

“Alternate Currency Letter of Credit” shall mean any Letter of Credit to the extent denominated in an Alternate Currency.

“Alternate Currency Loan” shall mean each Loan denominated in an Alternate Currency.

“Annual Compliance Certificate” means the compliance certificate required to be delivered pursuant to Section 7.01(h) at the time of delivery of the financial statements provided for in Section 7.01(b).

“Applicable Credit Rating” shall mean (i) the Moody’s Credit Rating and the S&P Credit Rating, if the same; (ii) if the Moody’s Credit Rating and the S&P Credit Rating differ by one rating level, the higher of such Ratings; and (iii) if the Moody’s Credit Rating and the S&P Credit Rating differ by two or more rating levels, the Applicable Credit Rating shall be one rating level below the higher of such Ratings; provided that if only one Rating Agency rates the senior unsecured debt of the Company, such rating shall be the Applicable Credit Rating unless the other Rating Agency ceased rating such senior unsecured debt at the request of the Company, in which case the Applicable Credit Rating shall be deemed to be below A-/A3.

“Applicable Insurance Regulatory Authority” shall mean, when used with respect to any Regulated Insurance Company, (x) the insurance department or similar administrative authority or agency located in each state or other jurisdiction (foreign or domestic) in which such Regulated Insurance Company is domiciled, (y) the insurance department, authority or agency in each state or other jurisdiction (foreign or domestic) in which such Regulated Insurance Company is licensed, to the extent it has regulatory jurisdiction over such Regulated Insurance Company, and (z) any Federal or national insurance regulatory department, authority or agency that may be created and that has regulatory jurisdiction over such Regulated Insurance Company.

 

 

	
             
 	
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“Applicable Facility Fee Percentage” shall mean, for any day, the rate per annum set forth below opposite the Applicable Period then in effect:

	
            Applicable Period
 	
            Applicable Facility Fee Percentage
 
	
             
 	
             
 
	
            Category A Period
 	
            0.060%
 
	
            Category B Period
 	
            0.070%
 
	
            Category C Period
 	
            0.080%
 
	
            Category D Period
 	
            0.100%
 
	
             
 	
             
 

“Applicable L/C Percentage” shall mean the percentage set forth below opposite the Applicable Period then in effect:

	
            Applicable Period
 	
            Applicable L/C Percentage
 
	
             
 	
             
 
	
            Category A Period
 	
            0.165%
 
	
            Category B Period
 	
            0.205%
 
	
            Category C Period
 	
            0.245%
 
	
            Category D Period
 	
            0.350%
 
	
             
 	
             
 

“Applicable Margin” shall mean the rate per annum set forth below opposite the Applicable Period then in effect:

	
             
  	
            Applicable Margin
  
	
            Applicable  Period
  	
            Eurodollar Loans
  	
            Base Rate Loans
  
	
             
 	
             
 	
             
 
	
            Category A Period
 	
            0.165%
 	
            0.00%
 
	
            Category B Period
 	
            0.205%
 	
            0.00%
 
	
            Category C Period
 	
            0.245%
 	
            0.00%
 
	
            Category D Period
 	
            0.350%
 	
            0.00%
 

“Applicable Period” shall mean, at any time, the period set forth below then in effect:

	
            Applicable Period
 	
            Criteria
 
	
            Category A Period
 	
            The Applicable Credit Rating is A+, A1 or above.
 
	
            Category B Period
 	
            The Applicable Credit Rating is A or A2.
 
	
            Category C Period
 	
            The Applicable Credit Rating is A- or A3.
 
	
            Category D Period
 	
            None of a Category A Period, a Category B Period or a Category C Period is in effect at such time.
 

 

 

 

	
             
 	
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Notwithstanding anything to the contrary set forth above, if neither Rating Agency rates the unsecured senior debt of the Company, then the Applicable Period shall be a Category D Period.

“Applicable Utilization Fee Percentage” shall mean, for any day, the percentage set forth below opposite the Applicable Period then in effect:

	
            Applicable Period
 	
            Applicable Utilization Fee Percentage
 
	
             
 	
             
 
	
            Category A Period
 	
            0.050%
 
	
            Category B Period
 	
            0.050%
 
	
            Category C Period
 	
            0.050%
 
	
            Category D Period
 	
            0.050%
 
	
             
 	
             
 

“Approved Currency” shall mean each of Dollars, each Primary Alternate Currency and each Other Alternate Currency. 

“Assignment Agreement” shall mean the Assignment Agreement in the form of Exhibit F (appropriately completed).

“Authorized Officer” shall mean any senior officer of a Borrower designated as such in writing to the Administrative Agent by such Borrower.

“Base Rate” shall mean, at any time, the higher of (i) the rate which is 1⁄2 of 1% in excess of the Federal Funds Effective Rate as published by the Federal Reserve Bank of New York and (ii) the Prime Commercial Lending Rate of JPMorgan Chase as announced from time to time at its head office.

“Base Rate Loan” shall mean each Revolving Loan that is not a Eurodollar Loan. 

“Bidder Lender” shall mean each Lender that has notified in writing (and has not withdrawn such notice) the Administrative Agent that it desires to participate generally in the bidding arrangements relating to Competitive Bid Borrowings.

“Borrower” or “Borrowers” shall mean the Company and each Designated Subsidiary Borrower.  For the purposes of Sections 5, 6, 7, 8 and 9 (including defined terms used therein) any reference to “Borrower” shall also mean, and include, the Company in its capacity as guarantor under Section 13.

“Borrowing” shall mean (i) the incurrence by a single Borrower of Revolving Loans that are Base Rate Loans on a pro rata basis from all Lenders; (ii) the incurrence by a single Borrower of Revolving Loans that are Eurodollar Loans on a pro rata basis from all Lenders, on a given date (or resulting from conversions on a given date), having the same Interest Period, provided that Base Rate Loans incurred pursuant to Section 1.11(b) shall be considered part of any related Borrowing of Eurodollar Loans; and (iii) a Competitive Bid Borrowing.

 

 

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

“Canadian Dollars” shall mean freely transferable lawful money of Canada.

“Canadian Dollar Equivalent” shall mean, at any time for the computation thereof, the amount of Canadian Dollars which could be purchased with the amount of Dollars involved in such computation at the spot exchange rate therefor as quoted by the Administrative Agent as of 11:00 A.M. (London time) on the date three Business Days prior to the date of any determination thereof for purchase on such date.

“Capital Stock” shall mean any capital stock of the Company or any Consolidated Subsidiary (to the extent issued to a Person other than the Borrowers), whether common or preferred.

“Cash Equivalents” shall mean, as to any Person, (i) securities issued or directly and fully guaranteed or insured by the United States or any agency or instrumentality thereof (provided that the full faith and credit of the United States is pledged in support thereof) having maturities of not more than one year from the date of acquisition, (ii) time deposits and certificates of deposit of any commercial bank having, or which is the principal banking subsidiary of a bank holding company organized under the laws of the United States, any State thereof, the District of Columbia or any foreign jurisdiction having, capital, surplus and undivided profits aggregating in excess of $200,000,000, with maturities of not more than one year from the date of acquisition by such Person, (iii) repurchase obligations with a term of not more
than 90 days for underlying securities of the types described in clause (i) above entered into with any bank meeting the qualifications specified in clause (ii) above, (iv) commercial paper rated at least A-1 or the equivalent thereof by S&P or at least P-1 or the equivalent thereof by Moody’s and in each case maturing not more than one year after the date of acquisition by such Person, (v) investments in money market funds substantially all of whose assets are comprised of securities of the types described in clauses (i) through (iv) above.

“Change of Control” shall mean the occurrence of any of the following events or conditions: (a) any Person or group of Persons (as used in Sections 13 and 14 of the Securities Exchange Act of 1934, and the rules and regulations thereunder) shall have become the beneficial owner (as defined in rules promulgated by the SEC) of more than 40% of the voting securities of the Company; or (b) a majority of the members of the Company’s board of directors are persons who are then serving on the board of directors without having been elected by the board of directors or having been nominated for election by its shareholders.

 

 

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

“Commitment” shall mean, with respect to each Lender, at any time, the amount set forth opposite such Lender’s name on Annex I, as the same may be increased pursuant to Section 1.16 or reduced pursuant to Sections 1.14, 3.02, 3.03 or 9.01. 

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

“Company Guaranty” shall mean the guaranty of the Company provided in Section 13.  

“Competitive Bid Borrowing” shall mean a Borrowing by a Borrower of Competitive Bid Loans pursuant to Section 1.04.

“Competitive Bid Loan” shall have the meaning specified in Section 1.01(b).

“Competitive Bid Note” shall have the meaning provided in Section 1.06(a).

“Consolidated Net Worth” shall mean, as of any date of determination, the Net Worth of the Company and its Subsidiaries on such date determined on a consolidated basis, plus, to the extent not otherwise included in Net Worth, the then issued and outstanding amount of all Qualified Trust Preferred Securities and Qualified Mandatorily Convertible Preferred Securities.  

“Consolidated Subsidiary” shall mean at any date any Subsidiary or other entity the accounts of which, in accordance with GAAP, would be consolidated with those of the Company in its consolidated financial statements as of such date.

“Consolidated Tangible Net Worth” shall mean, as of the date of any determination, Consolidated Net Worth of the Company on such date less the amount of all intangible items included therein, including, without limitation, goodwill, franchises, licenses, patents, trademarks, trade names, copyrights, service marks, brand names and write-ups of assets.

“Consolidated Total Capitalization” shall mean, as of any date of determination, the sum of (i) Consolidated Total Debt and (ii) Consolidated Net Worth.

“Consolidated Total Debt” shall mean, as of any date of determination, all Debt of the Company and its Subsidiaries on such date determined on a consolidated basis.

“Credit Documents” shall mean this Agreement and any Notes.

“Cumulative Consolidated Net Income” shall mean, for any period, an amount equal to the net income of the Company and its Subsidiaries (determined on a consolidated basis in accordance with GAAP) for such period.

 

 

	
             
 	
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“DSB Assumption Agreement” shall mean an assumption agreement in the form of Exhibit G.

“Debentures” shall mean subordinated debt securities issued by the Company or any Subsidiary to a Special Purpose Trust in exchange for proceeds of Qualified Preferred Securities and common securities of such Special Purpose Trust.

“Debt” of any Person shall mean at any date, without duplication, (i) all obligations of such Person for borrowed money, (ii) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments, (iii) all obligations of such Person to pay the deferred purchase price of property or services, except trade accounts payable arising in the ordinary course of business, (iv) all obligations of such Person as lessee under capital leases, (v) all obligations of such Person to reimburse any bank or other Person in respect of amounts payable under a banker’s acceptance, (vi) all Redeemable Preferred Stock of such Person (in the event such Person is a corporation), (vii) all obligations (absolute or contingent) of such Person to reimburse any bank or other Person in respect of amounts paid under a letter of credit or similar instrument, (viii) all Debt of
others secured by a Lien on any asset of such Person,  whether or not such Debt is assumed by such Person, and (ix) all Debt of others Guaranteed by such Person; provided, that (A) for the avoidance of doubt, insurance payment liabilities, as such, and liabilities arising in the ordinary course of such Person’s business as an insurance or reinsurance company (including GICs) or a corporate member of The Council of Lloyd’s or as a provider of financial or investment services or contracts (in each case other than in connection with the provision of financing to such Person or any of such Person’s Affiliate) shall not constitute Debt, and (B) solely for purposes of Section 8.10 and the definition of “Consolidated Total Debt,” “Debt” shall not include (I) any contingent obligations of any Person under or in connection with acceptance, letter of credit or similar facilities so long as no drawings or payments have been made in respect thereof,
(II) obligations of the Company or any Subsidiary under any Debentures or under any subordinated guaranty of any Qualified Trust Preferred Securities or obligations of a Special Purpose Trust under any Qualified Trust Preferred Securities or (III) obligations of the Company in respect of any Redeemable Preferred Stock that is part of a unit which constitutes Qualified Mandatorily Convertible Preferred Securities, but only up until such time as such Redeemable Preferred Securities are remarketed in connection with the settlement of the related contract for the purchase and sale of the Company’s ordinary common shares.

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

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

“Designated Subsidiary Borrower” shall mean Partner Reinsurance Company Ltd., PartnerRe S.A., Partner Reinsurance Company of the U.S., PartnerRe Insurance Company of New York, PartnerRe Ireland Insurance Limited, Partner Reinsurance Ireland Limited and each 90% Owned Subsidiary of the Company which is designated as a Designated Subsidiary Borrower in accordance with Section 1.15. 

 

 

	
             
 	
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“Dispositions” shall have the meaning provided for in Section 8.03(b).

“Dollar Equivalent” shall mean, at any time for the determination thereof in accordance with Section 12.07(c), the amount of Dollars which could be purchased with the amount of the relevant Alternate Currency involved in such computation at the spot exchange rate therefor as quoted by the Administrative Agent as of 11:00 A.M. (London time) on the date two Business Days prior to the date of any determination thereof for purchase on such date.

“Dollar” and the sign “$” shall each mean freely transferable lawful money of the United States.  

“EMU Legislation” shall mean the legislative measures of the European Council for the introduction of, changeover to or operation of a single or unified European currency.

“Equity Interests” shall mean, with respect to any Person, shares of capital stock of (or other ownership or profit interests in) such Person, warrants, options or other rights for the purchase or other acquisition from such Person of shares of capital stock of (or other ownership or profit interests in) such Person, securities convertible into or exchangeable for shares of capital stock of (or other ownership or profit interests in) such Person or warrants, rights or options for the purchase or other acquisition from such Person of such shares (or such other interests), and other ownership or profit interests in such Person (including, without limitation, partnership, member or trust interests therein), whether voting or nonvoting, and whether or not such shares, warrants, options, rights or other interests are authorized or otherwise existing on any date of determination.

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

“ERISA Affiliate” shall mean any corporation or trade or business which is a member of the same controlled group of corporations (within the meaning of Section 414(b) of the Code) as a Borrower or any of its Subsidiaries or is under common control (within the meaning of Section 414(c) of the Code) with the Borrower or any of its Subsidiaries.

“Euro” shall mean the lawful currency of each of the Participating Member States.

“Euro Equivalent” shall mean, at any time for the determination thereof, the amount of Euros which could be purchased with the amount of Dollars involved in such computation at the spot exchange rate therefor as quoted by JPMorgan Chase as of 11:00 A.M. (London time) on the date two Business Days prior to the date of any determination thereof for purchase on such date.

“Eurodollar Loan” shall mean each Loan that at the election of each Borrower is bearing interest by reference to LIBOR.

 

 

	
             
 	
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“Event of Default” shall have the meaning specified in Section 9.01.

“Exchange Act” shall mean the U.S. Securities Exchange Act of 1934, as amended.

“Excluded Period” shall mean, with respect to any additional amount payable under Section 1.11(a)(ii), 1.11(c), 1.11(d), 1.11(e) or 2.06, the period ending 180 days prior to the applicable Lender’s delivery of the written notice referenced in 1.11(a)(ii), 1.11(c), 1.11(d), 1.11(e) or 2.06, as applicable, with respect to such additional amount.

“Existing Credit Agreement” shall have the meaning provided in the recitals of this Agreement.

“Existing Fronted Letter of Credit” shall have the meaning provided in Section 2.10.

“Existing Lender” shall mean each “Lender” under and as defined in the Existing Credit Agreement.

“Existing Several Letter of Credit” shall have the meaning provided in Section 2.11.

“Facility Fees” shall have the meaning specified in Section 3.01(a).

“Facing Fee” shall have the meaning provided in Section 3.01(f).

“Federal Funds Effective Rate” shall mean, for any period, a fluctuating interest rate equal for each day during such period to the weighted average of the rates on overnight Federal Funds transactions with members of the Federal Reserve System arranged by Federal Funds brokers, as published for such day (or, if such day is not a Business Day, for the next preceding Business Day) by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is a Business Day, the average of the quotations for such day on such transactions received by the Administrative Agent from three Federal Funds brokers of recognized standing selected by the Administrative Agent.

“Fees” shall mean all amounts payable pursuant to, or referred to in, Section 3.01.

“Final Maturity Date” shall mean September 30, 2010.

“Financial Statement Delivery Date” shall mean each date upon which the Company’s audited annual financial statements are delivered pursuant to Section 7.01(b).

“Fiscal Year” means any fiscal year of the Borrowers.

“Foreign Pension Plan” shall mean any plan, fund (including, without limitation, any superannuation fund) or other similar program established or maintained outside the United States of America by the Borrower or any of its Subsidiaries primarily for the benefit of employees of the Borrower or such Subsidiaries residing outside the United States of America, 

 

 

	
             
 	
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which plan, fund or other similar program provides, or results in, retirement income, a deferral of income in contemplation of retirement or payments to be made upon termination of employment, and which plan is not subject to ERISA or the Code.

“Fronted Letter of Credit” shall have the meaning provided in Section 2.02(a) and shall include each Existing Fronted Letter of Credit.

“Fronted Unpaid Drawing” shall have the meaning provided in Section 2.05.

“Fronting Lender” shall mean JPMorgan Chase and any other Lender reasonably acceptable to the Administrative Agent (or their respective Affiliates) which is requested by the Company and which agrees in its sole discretion in writing, to issue Fronted Letters of Credit hereunder pursuant to Section 2.02; provided that no Fronting Lender shall be required to issue more than an aggregate Stated Amount of all Fronted Letters of Credit issued by such Fronting Lender as has been separately agreed upon by such Fronting Lender and the Company in writing.

“Fronting Participant” shall have the meaning provided in Section 2.02(b).

“GAAP” shall mean generally accepted accounting principles in the United States of America as in effect from time to time.

“Governmental Authority” means the government of the United States of America, or of any other nation, or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing regulatory or administrative powers or functions of or pertaining to government including, without limitation, any Applicable Insurance Regulatory Authority.

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

“Guaranteed Creditors” shall mean and include each of the Administrative Agent, the Lenders and each LC Issuer.

“Guaranteed Obligations” shall mean the principal and interest on each Note issued by each Designated Subsidiary Borrower to each Lender, and Loans made to each Designated Subsidiary Borrower, under this Agreement and all reimbursement obligations and Unpaid Drawings with respect to Letters of Credit issued for the account of each Designated 

 

 

	
             
 	
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Subsidiary Borrower, together with all the other obligations (including obligations which, but for the automatic stay under Section 362(a) of the Bankruptcy Code, would become due) and liabilities (including, without limitation, indemnities, fees and interest thereon) of each Designated Subsidiary Borrower to such Lender, the Administrative Agent and each LC Issuer now existing or hereafter incurred under, arising out of or in connection with this Agreement and each other Credit Document for which each Designated Subsidiary Borrower is a party and the due performance and compliance by any such Designated Subsidiary Borrower with all the terms, conditions and agreements contained in this Agreement and each such other Credit Document.

“Insurance Business” shall mean one or more aspects of the business of selling, issuing or underwriting insurance or reinsurance.  

“Interest Period” shall mean (a) with respect to any Eurodollar Loan, the interest period applicable thereto, as determined pursuant to Section 1.10 and (b) with respect to any Competitive Bid Loan, the period beginning on the date of incurrence thereof and ending on the stated maturity date thereof.

“Interest Rate Basis” shall mean LIBOR and/or such other basis for determining an interest rate as the Borrowers and the Administrative Agent may agree upon from time to time.

“Irish Designated Subsidiary Borrower” shall mean any Designated Subsidiary Borrower organized under the laws of Ireland.

“Issuing Agent” shall mean JPMorgan Chase.

“Issuing Country” shall have the meaning specified in Section 12.17(a).

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

“Judgment Currency” shall have the meaning provided in Section 12.16(a).

“Judgment Currency Conversion Date” shall have the meaning provided in Section 12.16(a).

“L/C FMD Amount” shall mean the Letter of Credit Outstandings as of the Final Maturity Date.

“LC Issuer” shall mean each of the Issuing Agent and each Fronting Lender.

“Lender” or “Lenders” shall have the meaning provided in the first paragraph of this Agreement.

“Lender Default” shall mean (i) the refusal (which has not been retracted) of a Lender to make available its portion of any Borrowing that it is required to make or (ii) a Lender having notified the Administrative Agent and/or each Borrower that it does not intend to comply 

 

 

	
             
 	
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with its obligations under Section 1.01, in the case of either clause (i) or (ii) above as a result of the appointment of a receiver or conservator with respect to such Lender at the direction or request of any regulatory agency or authority.

“Letter of Credit” shall mean each Fronted Letter of Credit and each Several Letter of Credit

“Letter of Credit Fee” shall have the meaning provided in Section 3.01(c).

“Letter of Credit Outstandings” shall mean, at any time, the sum of, without duplication (i) the aggregate Stated Amount of all Letters of Credit and (ii) the aggregate amount of all Unpaid Drawings in respect of all Letters of Credit. 

“Letter of Credit Request” shall have the meaning provided in Section 2.04(a).

“Letter of Credit Supportable Obligations” shall mean obligations of the Borrowers or any of their Subsidiaries which are permitted to exist pursuant to the terms of this Agreement. 

“LIBOR” shall mean, for each Interest Period applicable to any Loan (or other period for determination), the British Bankers Association Interest Settlement Rate that appears on page 3750 (or other appropriate page if the relevant currency does not appear on such page) of the Dow Jones Telerate Screen (or any successor page) for deposits in the relevant currency with maturities comparable to such Interest Period (or other period for determination) as of 11:00 A.M. (London time) on the date which is two Business Days prior to the commencement of such Interest Period (or other period for determination ) or, if such a rate does not appear on the Dow Jones Telerate Screen (or any successor page), the offered quotations to first-class banks in the London interbank market by JP Morgan Chase for deposits in the relevant currency of amounts in same day funds comparable to the outstanding
principal amount of such Loan with maturities comparable to such Interest Period (or other period for determination) determined as of 11:00 A.M. (London time) on the date which is two Business Days prior to the commencement of such Interest Period (or other period for determination).

“Lien” shall mean, with respect to any asset, any mortgage, deed to secure debt, deed of trust, lien, pledge, charge, security interest, security title, preferential arrangement which has the practical effect of constituting a security interest or encumbrance, servitude or encumbrance of any kind in respect of such asset to secure or assure payment of a Debt or a Guarantee, whether by consensual agreement or by operation of statute or other law, or by any agreement, contingent or otherwise, to provide any of the foregoing.  For the purposes of this Agreement, the Company or any Subsidiary shall be deemed to own subject to a Lien any asset which they have acquired or hold subject to the interest of a vendor or lessor under any conditional sale agreement, capital lease or other title retention agreement relating to such asset.

“Loan” or “Loans” shall mean each Revolving Loan and each Competitive Bid Loan.

“Loan Sublimit” shall mean, at any time, an amount equal to 50% of the Total Commitment at such time.

 

 

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

“Material Adverse Effect” shall mean, (i) a material adverse effect on the business, operations, property or financial condition of the Company and its Subsidiaries taken as a whole or (ii) a material adverse effect on (x) the rights and remedies of the Administrative Agent or the Lenders under the Credit Documents, (y) the ability of any Borrower to perform its obligations under the Credit Documents to which it is a party, as applicable, or (z) the legality, validity or enforceability of any Credit Document.

“Material Subsidiary” shall mean any Subsidiary of the Company whose total assets or total revenues exceed 2.5% of the total assets or gross revenues, respectively, of the Company and its Subsidiaries on a consolidated basis as of the most recent fiscal quarter end and for the most recent fiscal quarter period, respectively, determined in accordance with GAAP.

“Minimum Borrowing Amount” shall mean (i) for any Revolving Loans, $2,500,000, (ii) for any Competitive Bid Loans that are Dollar denominated, $2,500,000 and (iii) for any Competitive Bid Loans that are Alternate Currency Loans, an amount in the respective Alternate Currency having a Dollar Equivalent (determined at the time a Notice of Competitive Bid Borrowing is received) of $2,500,000.

“Moody’s” shall mean Moody’s Investor Services Inc. and it successors.

“Moody’s Credit Rating” shall mean the rating level (it being understood that a rating level shall include numerical modifiers and (+) and (-) modifiers) assigned by Moody’s to the senior unsecured long-term debt of the Company.  If the foregoing rating shall be changed by Moody’s, such change shall be effective for purposes of this definition on the Business Day following the day on which Moody’s announces such change.

"Multiemployer Plan" shall mean any multiemployer plan as defined in Section 4001(a)(3) of ERISA, which is maintained or contributed to by (or to which there is an obligation to contribute of) a Borrower, any of its Subsidiaries or any of its ERISA Affiliates, and each such plan for the five year period immediately following the latest date on which such Borrower, such Subsidiary or such ERISA Affiliate maintained, contributed to or had an obligation to contribute to such plan.

“Net Worth” shall mean, as to any Person, the sum of its capital stock, capital in excess of par or stated value of shares of its capital stock, retained earnings and any other account which, in accordance with GAAP, constitutes stockholders equity, excluding any treasury stock.

“New Solutions” shall mean PartnerRe New Solutions Inc., a Delaware corporation and a Wholly-Owned Subsidiary of the Borrower.

“90%-Owned Subsidiary” of any Person shall mean any other Person to the extent at least 90% of each class of the capital stock or other ownership interests are owned directly or indirectly by such first Person.

 

 

	
             
 	
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“Non-Continuing Lender Agreement” shall mean the Non-Continuing Lender Agreement substantially in the form of Exhibit J (appropriately completed).

“Non-Defaulting Lender” shall mean each Lender other than a Defaulting Lender.

“Note” shall mean each Revolving Note and each Competitive Bid Note.

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

“Notice of Competitive Bid Borrowing” shall have the meaning provided in Section 1.04(a).

“Notice of Conversion” shall have the meaning provided in Section 1.07.

“Notice of Non-Extension” shall have the meaning specified in Section 2.07.

“Notice Office” shall mean (a) except as provided in clause (b) below, the office of the Administrative Agent at 1111 Fannin 10th Floor, Houston, Texas 77002, Attention:  Jeremy Jones, Telephone: 713-750-3507, Facsimile: 713-750-2223 and (b) in the case of Notices of Borrowing in respect of Eurodollar Loans constituting Alternate Currency Loans, the office of the Administrative Agent at 125 London Wall, London, U.K. EC2Y5; or in each case such other office as the Administrative Agent may designate to the Borrowers from time to time.

“Obligations” shall mean all amounts, direct or indirect, contingent or absolute, of every type or description, and at any time existing, owing to the Administrative Agent or any Lender pursuant to the terms of this Agreement or any other Credit Document.

“Obligation Currency” shall have the meaning provided in Section 12.16(a).

“Original Effective Date” shall mean the “Effective Date” under, and as defined in, the Existing Credit Agreement.

“Other Alternate Currency” shall mean any freely transferable currency other than any Primary Alternate Currency, to the extent such currency is approved by the Administrative Agent.

“Participating Member State” shall mean any member state of the European Communities that adopts or has adopted the Euro as its lawful currency in accordance with the legislation of the European Union relating to European Monetary Union.

“Partner Reinsurance Company Ltd.” shall mean Partner Reinsurance Company Ltd., a company organized under the laws of Bermuda.

“Partner Reinsurance Ireland Limited” shall mean Partner Reinsurance Ireland Limited, a company organized under the laws of Ireland.

“PartnerRe Insurance Company of New York” shall mean PartnerRe Insurance Company of New York, a corporation organized under the laws of the State of New York.

 

 

	
             
 	
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“PartnerRe Ireland Insurance Limited” shall mean PartnerRe Ireland Insurance Limited, a company organized under the laws of Ireland.

“PartnerRe S.A.” shall mean PartnerRe S.A., a company organized under the laws of France.

“Partner Reinsurance Company of the US” shall mean Partner Reinsurance Company of the U.S., a corporation organized under the laws of the State of New York.

“Patriot Act” shall have the meaning provided in Section 12.19.

“Payment Office” shall mean the office of the Administrative Agent at 1111 Fannin 10th Floor, Houston, Texas 77002, Jeremy Jones, Telephone: 713-750-3507, Facsimile: 713-750-2223, or such other office or offices as the Administrative Agent may designate to the Borrowers from time to time.

“PBGC” shall mean the Pension Benefit Guaranty Corporation established pursuant to Section 4002 of ERISA, or any successor thereto.

“Percentage” shall mean, at any time for each Lender, the percentage obtained by dividing such Lender’s Commitment at such time by the Total Commitment then in effect, provided that if the Total Commitment has been terminated, the Percentage of each Lender shall be determined by dividing such Lender’s Commitment as in effect immediately prior to such termination by the Total Commitment as in effect immediately prior to such termination (but also giving effect to any assignments made in accordance with Section 12.04(b) after the date on which the Total Commitment has terminated).

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

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

“Pounds Sterling” shall mean freely transferable lawful money of the United Kingdom.

“Pounds Sterling Equivalent” shall mean, at any time for the determination thereof, the amount of Pounds Sterling which could be purchased with the amount of Dollars involved in such computation at the spot exchange rate therefor as quoted by JPMorgan Chase as of 11:00 A.M. (London time) on the date two Business Days prior to the date of any determination thereof for purchase on such date.

“Pre-existing Lender” shall have the meaning provided in Section 1.16(c).

 

 

	
             
 	
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“Primary Alternate Currency” shall mean each of Euros, Pounds Sterling, Swiss Francs and Canadian Dollars.

“Prime Lending Rate” shall mean the rate which JPMorgan Chase announces from time to time as its prime commercial lending rate, the Prime Lending Rate to change when and as such prime lending rate changes.  The Prime Lending Rate is a reference rate and does not necessarily represent the lowest or best rate actually charged to any customer.  JPMorgan Chase may make commercial loans or other loans at rates of interest at, above or below the Prime Lending Rate.

“Principal Amount” shall mean (i) the outstanding principal amount of each Loan denominated in Dollars, and/or (ii) the Dollar Equivalent of the outstanding principal amount of each Alternate Currency Loan, as the context may require.

“Private Act” shall mean separate legislation enacted in Bermuda with the intention that such legislation apply specifically to a Borrower, in whole or in part.

“Qualified Mandatorily Convertible Preferred Securities” shall mean (without duplication) (a) the 8% Premium Equity Participating Security Units issued by the Company; and (b) other units comprised of (i) preferred shares of the Company and (ii) a contract for the sale of ordinary common shares of the Company so long as the holder of such unit is obligated to purchase such ordinary common shares with cash or the proceeds from remarketing such preferred shares.

“Qualified Trust Preferred Securities” shall mean (a) the 7.90% Preferred Securities issued by PartnerRe Capital Trust I and guaranteed by the Company; and (b) other preferred securities issued by a Special Purpose Trust which shall provide, among other things, that dividends shall be payable only out of proceeds of interest payments on the Debentures, so long as such preferred securities do not constitute Redeemable Preferred Stock.

“Rating Agency” shall mean S&P or Moody’s, as the case may be.

“Redeemable Preferred Stock” of any Person shall mean any preferred stock issued by such Person which (a) is either (i) mandatorily redeemable (by sinking fund or similar payments or otherwise) prior to the fifth anniversary of the Final Maturity Date or (ii) redeemable at the option of the holder thereof or (b) contains any financial performance related covenants or incurrence covenants which restrict the operations of the issuer thereof; provided that any preferred stock that such Person has the right or obligation to redeem at such time with Capital Stock that is not Redeemable Preferred Stock, shall not constitute Redeemable Preferred Stock.

“Register” shall have the meaning provided in Section 12.15.

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

 

 

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

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

“Relevant Currency Equivalent” shall mean the Dollar Equivalent, the Canadian Dollar Equivalent, the Euro Equivalent, the Pounds Sterling Equivalent or the Swiss Franc Equivalent. 

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

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

“Reply Date” shall have the meaning specified in Section 1.04(b).

“Required Lenders” shall mean at any time Non-Defaulting Lenders having at least a majority of the aggregate Commitments of all Non-Defaulting Lenders; provided that if the Total Commitment has been terminated, then the Required Lenders shall mean Lenders whose outstanding Loans equal or exceed a majority of the aggregate outstanding Loans at such time.

“Restatement Effective Date” shall have the meaning provided in Section 5.01.

“Restatement Effective Overall Rate” shall mean the rate designated as such in the TEG Letter.

 

“Retroactive Period” shall have the meaning provided in Section 1.11(f).

“Revolving Loan” shall have the meaning specified in Section 1.01(a).

“Revolving Note” shall have the meaning provided in Section 1.06(a).

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

“S&P Credit Rating” shall mean the rating level (it being understood that a rating level shall include numerical modifiers and (+) and (-) modifiers) assigned by S&P to the senior unsecured long-term debt of the Company.  If the foregoing rating shall be changed by S&P, such change shall be effective for purposes of this definition on the Business Day following the day on which S&P announces such change.

“Section 4.04 Certificate” shall have the meaning provided in Section 4.04(b)(ii).

“Service of Process Agent” means Partner Reinsurance Company of the U.S., with offices on the date hereof located at 1 Greenwich Plaza, Greenwich, CT 06830.

 

 

	
             
 	
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“Several Letter of Credit” shall have the meaning provided in Section 2.01(a) and shall include each Existing Several Letter of Credit and each Specified Several Letter of Credit.

“Several Unpaid Drawing” shall have the meaning provided in Section 2.05.

“Special Purpose Trust” shall mean a special purpose business trust established by the Company or any Subsidiary of which the Company or any Subsidiary will hold all the common securities, which will be the issuer of Qualified Trust Preferred Securities, and which will loan to the Company or any Subsidiary (such loan being evidenced by the Debentures) the net proceeds of the issuance and sale of the Qualified Trust Preferred Securities and common securities of such Special Purpose Trust.

“Specified Several Letters of Credit” shall have the meaning provided in Section 1.16(c). 

“Spread” shall mean a percentage per annum in excess of, or less than, an Interest Rate Basis.

“Spread Borrowing” shall mean a Competitive Bid Borrowing with respect to which a Borrower has requested the Bidder Lenders to make Competitive Bid Loans at a Spread over or under a specified Interest Rate Basis.

“Stated Amount” shall mean at, any time, (i) if the Letter of Credit is denominated in Dollars, the maximum amount available to be drawn thereunder (regardless of whether any conditions for drawing could then be met) and (ii) if the Letter of Credit is an Alternative Currency Letter of Credit, the Dollar Equivalent of the maximum amount available to be drawn under the Letter of Credit (regardless of whether any conditions for drawing could then be met).

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

“Swiss Franc Equivalent” shall mean, at any time for the determination thereof, the amount of Swiss Francs which could be purchased with the amount of Dollars involved in such computation at the spot exchange rate therefor as quoted by JPMorgan Chase as of 11:00 A.M. (London time) on the date two Business Days prior to the date of any determination thereof for purchase on such date.

“Swiss Francs” shall mean freely transferable lawful money of Switzerland.

“Tax Refund” shall have the meaning provided in Section 4.4(d).

 

 

	
             
 	
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“Taxes” shall have the meaning provided in Section 4.04(a).

“TEG Letter” shall mean the letter dated as of the date hereof addressed to PartnerRe S.A. from the Administrative Agent setting forth the effective overall interest rate in respect of the Loans to be made available to PartnerRe S.A. and the basis therefor.

“Total Commitment” shall mean, at any time, the sum of the Commitments of each of the Lenders at such time.

“Total Unutilized Commitment” shall mean, at any time, the Total Commitment at such time minus the sum of the aggregate outstanding Principal Amount of Loans at such time and the Letter of Credit Outstandings at such time.

“Type” shall mean any type of Loan determined with respect to the interest option applicable thereto.

“Unpaid Drawings” shall mean the Several Unpaid Drawings and the Fronted Unpaid Drawings.

“U.S. Borrower” shall mean a Borrower organized under the laws of the United States.

“Utilization Fee” shall have the meaning provided for in Section 3.01(b).

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

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

SECTION 11.  The Administrative Agent.

11.01    Appointment.  The Lenders hereby designate JPMorgan Chase as Administrative Agent (such term as used in this Section 11 to include JPMorgan Chase, acting as Issuing Agent under this Agreement and each Letter of Credit), to act as specified herein and in the other Credit Documents.  Each Lender hereby irrevocably authorizes, and each holder of any Note by the acceptance of such Note shall be deemed irrevocably to authorize, the Administrative Agent to take such action on its behalf under the provisions of this Agreement, the other Credit Documents and any other instruments and agreements referred to herein or therein and to exercise such powers and to perform such duties hereunder and thereunder as are specifically delegated to or required of the Administrative Agent by the terms hereof and thereof and such other powers as are reasonably
incidental thereto.  The Agents may perform any of their duties hereunder by or through their respective officers, directors, agents, employees or affiliates.

11.02    Nature of Duties.  The Administrative Agent shall not have any duties or responsibilities except those expressly set forth in this Agreement and the other Credit 

 

 

	
             
 	
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Documents.  Neither the Administrative Agent nor any of its respective officers, directors, agents, employees or affiliates shall be liable for any action taken or omitted by them hereunder or under any other Credit Document or in connection herewith or therewith, unless caused by their gross negligence or willful misconduct.  The duties of the Administrative Agent shall be mechanical and administrative in nature; the Administrative Agent shall not have by reason of this Agreement or any other Credit Document a fiduciary relationship in respect of any Lender or the holder of any Note; and nothing in this Agreement or any other Credit Document, expressed or implied, is intended to or shall be so construed as to impose upon either Agent any obligations in respect of this Agreement or any other Credit Document except as expressly set forth herein or therein with respect to the Administrative Agent.

11.03    Lack of Reliance on the Administrative Agent.  Independently and without reliance upon the Administrative Agent, each Lender and the holder of each Note, to the extent it deems appropriate, has made and shall continue to make (i) its own independent investigation of the financial condition and affairs of the Borrowers and their Subsidiaries in connection with the making and the continuance of the Loans and the taking or not taking of any action in connection herewith and (ii) its own appraisal of the creditworthiness of the Borrowers and their Subsidiaries and, except as expressly provided in this Agreement, the Administrative Agent shall not have any duty or responsibility, either initially or on a continuing basis, to provide any Lender or the holder of any Note with any credit or other information with respect thereto, whether
coming into its possession before the making of the Loans or at any time or times thereafter.  The Administrative Agent shall not be responsible to any Lender or the holder of any Note for any recitals, statements, information, representations or warranties herein or in any document, certificate or other writing delivered in connection herewith or for the execution, effectiveness, genuineness, validity, enforceability, perfection, collectibility, priority or sufficiency of this Agreement or any other Credit Document or the financial condition of the Borrowers and their Subsidiaries be required to make any inquiry concerning either the performance or observance of any of the terms, provisions or conditions of this Agreement or any other Credit Document, or the financial condition of the Borrowers and their Subsidiaries or the existence or possible existence of any Default or Event of Default.

11.04    Certain Rights of the Administrative Agent.  If any Administrative Agent shall request instructions from the Required Lenders with respect to any act or action (including failure to act) in connection with this Agreement or any other Credit Document, the Administrative Agent shall be entitled to refrain from such act or taking such action unless and until the Administrative Agent shall have received instructions from the Required Lenders; and the Administrative Agent shall not incur liability to any Person by reason of so refraining.  Without limiting the foregoing, neither any Lender nor the holder of any Note shall have any right of action whatsoever against the Administrative Agent as a result of the Administrative Agent acting or refraining from acting hereunder or under any other Credit Document in accordance with the instructions of
the Required Lenders.

11.05    Reliance.  The Administrative Agent shall be entitled to rely, and shall be fully protected in relying, upon any note, writing, resolution, notice, statement, certificate, telex, teletype, facsimile or telecopier message, cablegram, radiogram, order or other document or telephone message signed, sent or made by any Person that such Agent believed to be the proper Person, and, with respect to all legal matters pertaining to this Agreement and any other Credit 

 

 

	
             
 	
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Document and its duties hereunder and thereunder, upon advice of counsel selected by the Administrative Agent.

11.06    Indemnification.  To the extent the Administrative Agent is not reimbursed and indemnified by the Borrowers, the Lenders will reimburse and indemnify the Administrative Agent, in proportion to their respective “percentages” as used in determining the Required Lenders, for and against any and all liabilities, obligations, losses, damages, penalties, claims, actions, judgments, costs, expenses or disbursements of whatsoever kind or nature which may be imposed on, asserted against or incurred by the Administrative Agent in performing its respective duties hereunder or under any other Credit Document, in any way relating to or arising out of this Agreement or any other Credit Document provided that no Lender shall be liable for any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from the gross negligence or willful misconduct of the Administrative Agent.

11.07    The Administrative Agent’s Individual Capacities.  With respect to its obligation to make Loans under this Agreement, the Administrative Agent shall have the rights and powers specified herein for a “Lender” and may exercise the same rights and powers as though it were not performing the duties specified herein; and the term “Lenders,” “Required Lenders,” “holders of Notes” or any similar terms shall, unless the context clearly otherwise indicates, include the Administrative Agent in its individual capacities.  The Administrative Agent may accept deposits from, lend money to, and generally engage in any kind of banking, trust or other business with each Borrower or any Affiliate of each Borrower as if they were not performing the duties specified herein, and may accept fees and other consideration
from each Borrower for services in connection with this Agreement and otherwise without having to account for the same to the Lenders.

11.08    Holders.  The Administrative Agent may deem and treat the payee of any Note as the owner thereof for all purposes hereof unless and until a written notice of the assignment, transfer or endorsement thereof, as the case may be, shall have been filed with the Administrative Agent.  Any request, authority or consent of any Person who, at the time of making such request or giving such authority or consent, is the holder of any Note shall be conclusive and binding on any subsequent holder, transferee, assignee or indorsee, as the case may be, of such Note or of any Note or Notes issued in exchange therefor.

11.09    Resignation by the Administrative Agent.  (a)  The Administrative Agent may resign from the performance of all its functions and duties hereunder and/or under the other Credit Documents at any time by giving 15 Business Days’ prior written notice to the Borrowers and the Lenders.  Such resignation shall take effect upon (i) the appointment of a successor Administrative Agent pursuant to clauses (b) and (c) below or as otherwise provided below and (ii) notice by the Administrative Agent to each beneficiary of each then outstanding Letter of Credit of the change in Administrative Agent.  Upon the effectiveness of such resignation, the resigning Administrative Agent shall return to the Company a pro-rated portion of any administrative fee that has been paid in advance for the period following the effectiveness of its resignation.

 

 

	
             
 	
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(b)        Upon any such notice of resignation, the Required Lenders shall appoint a successor Administrative Agent hereunder who shall be a Lender, commercial bank or trust company reasonably acceptable to the Company.

(c)        If a successor Administrative Agent shall not have been so appointed within such 15 Business Day period, the Administrative Agent, with the consent of the Company shall then appoint a successor Administrative Agent who shall serve as Administrative Agent hereunder until such time, if any, as the Required Lenders appoint a successor Administrative Agent as provided above.

11.10    Other Agents.  No Person listed on the signature pages hereto as a Co-Arranger, Syndication Agent, Co-Documentation Agent, Sole Lead Arranger or Sole BookRunner shall have any obligations hereunder in its capacity as such.

SECTION 12.  Miscellaneous.

12.01    Payment of Expenses, etc.  The Borrowers jointly and severally agree to:  (i) pay all reasonable out-of-pocket costs and expenses (1) of the Administrative Agent and each LC Issuer in connection with the negotiation, syndication, preparation, execution, delivery and administration of the Credit Documents, Letters of Credit or the documents and instruments referred to therein and any amendment, waiver or consent relating thereto (including, without limitation, the reasonable fees and disbursements of White & Case LLP and of consultants and advisors to the Administrative Agent and its counsel) and (2) of the Administrative Agent, the Issuing Agent and each of the Lenders in connection with the enforcement of the Credit Documents, Letters of Credit or the documents and instruments referred to therein (including, without
limitation, the reasonable fees and disbursements of counsel for each of the Lenders); (ii) pay and hold the Administrative Agent, the Issuing Agent and each Lender harmless from and against any and all present and future stamp, VAT and other similar taxes and duties with respect to the foregoing matters and/or fees and save each of the Lenders harmless from and against any and all liabilities with respect to or resulting from any delay or omission (other than to the extent attributable to such Lender) to pay such taxes; and (iii) indemnify each Lender (including in its capacity as an Administrative Agent and Issuing Agent), its officers, directors, employees, representatives and agents from and hold each of them harmless against any and all losses, liabilities, claims, damages or expenses incurred by any of them as a result of, or arising out of, or in any way related to, or by reason of, an investigation (other than an investigation commenced by such Lender), litigation or other
proceeding (whether or not the Administrative Agent or any Lender is a party thereto and whether or not any such investigation, litigation or other proceeding is between or among the Administrative Agent, any Lender, or any other third Person) related to the entering into and/or performance of any Credit Document, Letters of Credit or the use of the proceeds of any Loans hereunder or the consummation of any transactions contemplated in any Credit Document, and in each case, including, without limitation, the reasonable fees and disbursements of counsel incurred in connection with any such investigation, litigation or other proceeding (but excluding any such losses, liabilities, claims, damages or expenses to the extent incurred by reason of the gross negligence or willful misconduct of the Person to be indemnified).  All expenses paid by the Borrowers pursuant to this Section 12.01 shall be paid in the currency in which such expenses were incurred by the Administrative Agent, each
LC Issuer or Lenders, as the case may be.

 

 

	
             
 	
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12.02    Right of Setoff.  In addition to any rights or remedies (including other rights of set off) which any Lender may have, now or hereafter granted under applicable law or otherwise, and not by way of limitation of any such rights, upon the occurrence and continuance of an Event of Default, each Lender is hereby authorized at any time or from time to time, without presentment, demand, protest or other notice of any kind to any Borrower or to any other Person, any such notice being hereby expressly waived, to set off and to appropriate and apply any and all deposits in whatever currency (general or special, time or demand, provisional or final) at any time held and any other indebtedness at any time held or owing by such Lender (including, without limitation, by branches and agencies of such Lender wherever located, but excluding any assets in securities custody
accounts) to or for the credit or the account of any Borrower against and on account of the Obligations and liabilities of any such Borrower, now or hereafter existing, to such Lender or any other Lender under this Agreement or under any of the other Credit Documents, including, without limitation, all interests in Obligations of any such Borrower purchased by such Lender or any other Lender pursuant to Section 12.06(b), and all other claims of any nature or description arising out of or connected with this Agreement or any other Credit Document, irrespective of whether or not such Lender shall have made any demand hereunder and although said Obligations, liabilities or claims, or any of them, shall be contingent or unmatured.  Each Lender is hereby designated the agent of all other Lenders for purposes of effecting set off pursuant to this Section 12.02.

12.03    Notices.  Except as otherwise expressly provided herein, all notices and other communications provided for hereunder shall be in writing (including telecopier or facsimile) and mailed, telecopied, faxed or delivered, if to a Borrower, at the address specified opposite its signature below or in the other relevant Credit Documents, as the case may be; if to any Lender or the Administrative Agent, at its address specified for such Lender or the Administrative Agent on Annex II hereto; or, at such other address as shall be designated by any party in a written notice to the other parties hereto.  All such notices and communications shall be mailed, telecopied or sent by overnight courier, and shall be effective when received.

12.04    Benefit of Agreement.  (a)This Agreement shall be binding upon and inure to the benefit of and be enforceable by the respective successors and assigns of the parties hereto, provided that no Borrower may assign or transfer any of its rights or obligations hereunder without the prior written consent of the Lenders.  Each Lender may, without the consent of the Borrowers, at any time grant participations in any of its rights hereunder or under any of the Notes to any Person,  provided that (x) in the case of any such participation, the participant shall not have any rights under this Agreement or any of the other Credit Documents (the participant’s rights against such Lender in respect of such participation to be those set forth in the agreement executed by such Lender in favor of the participant relating thereto) and all
amounts payable by the Borrowers hereunder shall be determined as if such Lender had not sold such participation, except that the participant shall be entitled to the benefits of Sections 1.11 and 4.04 of this Agreement to the extent that such Lender would be entitled to such benefits if the participation had not been entered into or sold and (y) no Lender shall transfer, grant or assign any participation under which the participant shall have rights to approve any amendment to or waiver of this Agreement or any other Credit Document except to the extent such amendment or waiver would extend the final scheduled maturity of any Loan or Note in which such participant is participating, or reduce the rate or extend the time of payment of interest or Fees thereon (except in connection with a waiver of the applicability of any post-default increase in interest 

 

 

	
             
 	
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rates), or reduce the principal amount thereof, or increase such participant’s participating interest in any Commitment over the amount thereof then in effect (it being understood that a waiver of any Default or Event of Default or of a mandatory reduction in the Total Commitment, or a mandatory prepayment, shall not constitute a change in the terms of any Commitment).  

(b)        Notwithstanding the foregoing, (x) any Lender may assign all or a portion of and its rights and obligations hereunder to another Lender (or an Affiliate of such assigning Lender), and (y) with the consent of the Administrative Agent and, so long as no Default or Event of Default exists, the Company (which consent shall not be unreasonably withheld), any Lender may assign all or a portion of its rights and obligations hereunder to one or more Persons. No assignment pursuant to the immediately preceding sentence by a Lender (or by Lenders which are Affiliates of each other) shall to the extent such assignment represents an assignment to an institution other than one or more Lenders hereunder (or to an Affiliate of an assigning Lender), be in an aggregate amount less than $5,000,000 unless all of the rights and obligations of the assigning
Lender (or group of Lenders which are Affiliates) is so assigned and no assignment shall be effective until all of the then outstanding Several Letters of Credit are returned by each respective beneficiary to the Issuing Agent for cancellation in exchange for new or amended Several Letters of Credit which give effect to such assignment (it being understood and agreed that if the beneficiaries of all then outstanding Several Letters of Credit do not consent to such amendment or exchange, such assignment cannot occur).  If any Lender so sells or assigns all or a part of its rights hereunder or under the Notes, any reference in this Agreement or the Notes to such assigning Lender shall thereafter refer to such Lender and to the respective assignee to the extent of their respective interests and the respective assignee shall have, to the extent of such assignment (unless otherwise provided therein), the same rights and benefits as it would if it were such assigning Lender.  Each
assignment pursuant to this Section 12.04(b) shall be effected by the assigning Lender and the assignee Lender executing an Assignment Agreement (appropriately completed).  At the time of any such assignment, (i) either the assigning or the assignee Lender shall pay to the Administrative Agent a nonrefundable assignment fee of $3,500, (ii) Annex I shall be deemed to be amended to reflect the Commitment of the respective assignee (which shall result in a direct reduction to the Commitment of the assigning Lender) and of the other Lenders, (iii) the Borrowers at such time will issue new Notes to the respective assignee and to the assigning Lender in conformity with the requirements of Section 1.06 and (iv) all then outstanding Several Letters of Credit (if the beneficiaries thereof have agreed) shall be amended or returned to the Issuing Agent for cancellation and reissued to reflect such assignment.  To the extent any assignment pursuant to this Section 12.04(b) is to a
Person which is not already a Lender hereunder and which is not a United States Person (as such term is defined in Section 7701(a)(30) of the Code) for Federal income tax purposes, the respective assignee Lender shall provide to the Company and the Administrative Agent the appropriate Internal Revenue Service Forms (and, if applicable, a Section 4.04(b)(ii) Certificate) described in Section 4.04(b).  To the extent that an assignment of all or any portion of a Lender’s Commitments and related outstanding obligations pursuant to this Section 12.04(b) would, at the time of such assignment, result in increased costs under Section 1.11 or 4.04 from those being charged by the respective assigning bank prior to such assignment, then the Borrowers shall not be obligated to pay such increased costs (although the Borrowers shall be obligated to pay any other increased costs of the type described above resulting from changes specified in said Section 1.11 or 4.04 occurring after the
date of the respective assignment).  Each Lender and each of the Borrowers agree to execute such documents (including without limitation amendments to this 

 

 

	
             
 	
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Agreement and the other Credit Documents) as shall be necessary to effect the foregoing.  Nothing in this clause (b) shall prevent or prohibit any Lender from pledging its Notes or Loans to a Federal Reserve Bank in support of borrowings made by such Lender from such Federal Reserve Bank.

(c)        Notwithstanding any other provisions of this Section 12.04, no transfer or assignment of the interests or obligations of any Lender hereunder or any grant of participation therein shall be permitted if such transfer, assignment or grant would require any Borrower to file a registration statement with the Securities and Exchange Commission or to qualify the Loans under the “Blue Sky” laws of any State.

12.05    No Waiver; Remedies Cumulative.  No failure or delay on the part of any Administrative Agent or any Lender in exercising any right, power or privilege hereunder or under any other Credit Document shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege hereunder or under any other Credit Document preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder or thereunder.  The rights and remedies herein expressly provided are cumulative and not exclusive of any rights or remedies which any Agent or any Lender would otherwise have.

12.06    Payments Pro Rata.  (a)  The Administrative Agent agrees that promptly after its receipt of each payment from or on behalf of each Borrower in respect of any Obligations of such Borrower hereunder, it shall distribute such payment to the Lenders (other than any Lender that has expressly waived its right to receive its pro rata share thereof) pro rata based upon their respective shares, if any, of the Obligations with respect to which such payment was received.

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

(c)        Notwithstanding anything to the contrary contained herein, the provisions of the preceding Sections 12.06(a) and (b) shall be subject to the express provisions of this Agreement which require, or permit, differing payments to be made to Non-Defaulting Lenders as opposed to Defaulting Lenders.

12.07    Calculations; Computations.  (a)  The financial statements to be furnished to the Lenders pursuant hereto shall be made and prepared in conformity with GAAP, 

 

 

	
             
 	
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consistently applied throughout the periods involved (except as set forth in the notes thereto or as otherwise disclosed in writing by the Borrowers to the Lenders and with respect to any interim financial statements, subject to changes resulting from audit and normal year-end audit adjustments), provided that (x) except as otherwise specifically provided herein, all computations determining compliance with Sections 8.10 and 8.11, including definitions used therein, shall utilize accounting principles and policies in effect at the time of the preparation of, and in conformity with those used to prepare, the December 31, 2004 financial statements delivered to the Lenders pursuant to Section 6.04(a) and (y) if at any time the computations determining compliance with Sections 8.10 and 8.11 utilize accounting principles different from those utilized in the
financial statements furnished to the Lenders, such financial statements shall be accompanied by reconciliation work-sheets.

(b)        All computations of interest and Fees hereunder shall be made on the actual number of days elapsed over a year of 360 days (365-366 days for interest on Base Rate Loans when the Base Rate is based on the Prime Lending Rate).

(c)        For purposes of this Agreement, the Dollar Equivalent of each Loan that is an Alternate Currency Loan and the Dollar Equivalent of the Stated Amount of each Letter of Credit that is an Alternate Currency Letter of Credit shall be calculated on the date when any such Loan is made, such Letter of Credit is issued, on the first Business Day of each month and at such other times as designated by the Administrative Agent.  Such Dollar Equivalent shall remain in effect until the same is recalculated by the Administrative Agent as provided above and notice of such recalculation is received by the Borrowers, it being understood that until such notice of such recalculation is received, the Dollar Equivalent shall be that Dollar Equivalent as last reported to the Borrowers by the Administrative Agent.  The Administrative Agent shall promptly notify
the Borrowers and the Lenders of each such determination of the Dollar Equivalent.

12.08    Governing Law; Submission to Jurisdiction; Venue; Waiver of Jury Trial.  (a)  THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK.  Any legal action or proceeding with respect to this Agreement or any other Credit Document may be brought in the courts of the State of New York or of the United States for the Southern District of New York, and, by execution and delivery of this Agreement, each Borrower hereby irrevocably accepts for itself and in respect of its property, generally and unconditionally, the jurisdiction of the aforesaid courts.  Each Borrower further irrevocably consents to the service of process out of any of the aforementioned courts in any such action or
proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to it, to the extent located outside New York City, or by hand, to the extent located within New York City, at its address for notices pursuant to Section 12.03, such service to become effective 30 days after such mailing.  Nothing herein shall affect the right of the Administrative Agent or any Lender to serve process in any manner permitted by law or to commence legal proceedings or otherwise proceed against each Borrower in any other jurisdiction.

(b)         Each Borrower hereby irrevocably and unconditionally waives any objection which it may now or hereafter have to the laying of venue of any of the aforesaid actions or 

 

 

	
             
 	
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proceedings arising out of or in connection with this Agreement or any other Credit Document brought in the courts referred to in clause (a) above and hereby further irrevocably waives and agrees not to plead or claim in any such court that any such action or proceeding brought in any such court has been brought in an inconvenient forum.

(c)         EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

(d)         Each Borrower hereby irrevocably designates, appoints and empowers the Service of Process Agent, as its designee, appointee and agent to receive, accept and acknowledge for and on its behalf, and in respect of its property, service of any and all legal process, summons, notices and documents which may be served in any such action or proceeding referred to in clause (a) above.  If for any reason such designee, appointee and agent shall cease to be available to act as such, each Borrower agrees to designate a new designee, appointee and agent on the terms and for the purposes of this provision reasonably satisfactory to the Administrative Agent under this agreement.

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

12.10    Headings Descriptive.  The headings of the several sections and subsections of this Agreement are inserted for convenience only and shall not in any way affect the meaning or construction of any provision of this Agreement.

12.11    Amendment or Waiver.  Neither this Agreement nor any other Credit Document nor any terms hereof or thereof may be changed, waived, discharged or terminated unless such change, waiver, discharge or termination is in writing signed by the Borrowers and the Required Lenders, provided that no such change, waiver, discharge or termination shall, without the consent of each Lender (other than a Defaulting Lender) directly affected thereby, (i) extend the Final Maturity Date or reduce the rate or extend the time of payment of interest (other than as a result of waiving the applicability of any post-default increase in interest rates) or Fees or other amounts payable hereunder, or reduce the principal amount thereof, or increase the Commitment of any Lender over the amount thereof then in effect (it being understood that a waiver of
any Default or Event of Default shall not constitute a change in the terms of any Commitment of any Lender), (ii) amend, modify or waive any provision of Section 12.06 or this Section 12.11, (iii) reduce the percentage specified in, or (except to give effect to any additional facilities hereunder) otherwise modify, the definition of Required Lenders, (iv) release the Company from its obligations under Company Guaranty or (v) consent to the assignment or transfer by each Borrower of any of its rights and obligations under this Agreement.

 

 

	
             
 	
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12.12    Survival.  All indemnities set forth herein including, without limitation, in Section 1.11, 1.12, 4.04, 12.01 or 12.16 shall survive the execution and delivery of this Agreement and the making and repayment of the Loans.

12.13    Domicile of Loans.  Each Lender may transfer and carry its Loans at, to or for the account of any branch office, Subsidiary or affiliate of such Lender, provided that the Borrowers shall not be responsible for costs arising under Section 1.11 or 4.04 resulting from any such transfer (other than a transfer pursuant to Section 1.13 or 1.14) to the extent not otherwise applicable to such Lender prior to such transfer.

12.14    Confidentiality.  Subject to Section 12.04, the Lenders shall hold all non-public information obtained pursuant to the requirements of this Agreement in accordance with its customary procedure for handling confidential information of this nature and in accordance with safe and sound banking practices and in any event may make disclosure to its Affiliates, employees, auditors, advisors or counsel or as reasonably required by any bona fide transferee or participant in connection with the contemplated transfer of any Loans or participation therein (so long as such transferee or participant agrees to be bound by the provisions of this Section 12.14) or as required or requested by any governmental agency or representative thereof or
pursuant to legal process, provided that, unless specifically prohibited by applicable law or court order, each Lender shall notify the Company of any request by any governmental agency or representative thereof (other than any such request in connection with an examination of the financial condition of such Lender by such governmental agency) for disclosure of any such non-public information prior to disclosure of such information, and provided further that in no event shall any Lender be obligated or required to return any materials furnished by the Company or any of its Subsidiaries.  Notwithstanding anything herein to the contrary, any Lender (and any employee, representative or other agent of such Lender) may disclose to any and all persons, without limitation of any kind, such Lender’s U.S. federal income tax treatment and the U.S. federal income tax structure of the transactions contemplated hereby relating to such Lender and all materials of any kind (including
opinions or other tax analyses) that are provided to it relating to such tax treatment and tax structure.  However, no disclosure of any information relating to such tax treatment or tax structure may be made to the extent nondisclosure is reasonably necessary in order to comply with applicable securities laws.

12.15    Registry.   Each Borrower hereby designates the Administrative Agent to serve as the Borrower’s agent, solely for purposes of this Section 12.15, to maintain a register (the “Register”) on which it will record the Commitments from time to time of each of the Lenders, the Loans made by each of the Lenders and each repayment in respect of the principal amount of the Loans of each Lender.  Failure to make any such recordation, or any error in such recordation  shall not affect the Borrower’s obligations in respect of such Loans.  With respect to any Lender, the transfer of the Commitments of such Lender and the rights to the principal of, and interest on, any Loan made pursuant to such Commitments shall not be effective until such transfer is recorded on the Register maintained by the Administrative Agent with
respect to ownership of such Commitments and Loans and prior to such recordation all amounts owing to the transferor with respect to such Commitments and Loans shall remain owing to the transferor.  The registration of assignment or transfer of all or part of any Commitments and Loans shall be recorded by the Administrative Agent on the Register only upon the acceptance by the Administrative Agent of a properly executed and delivered Assignment and Assumption 

 

 

	
             
 	
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Agreement pursuant to Section 12.04(b).  Coincident with the delivery of such an Assignment and Assumption Agreement to the Administrative Agent for acceptance and registration of assignment or transfer of all or part of a Loan, or as soon thereafter as practicable, the assigning or transferor Lender shall surrender the Note evidencing such Loan, and thereupon one or more new Notes in the same aggregate principal amount shall be issued to the assigning or transferor Lender and/or the new Lender.  The Borrower agrees to indemnify the Administrative Agent from and against any and all losses, claims, damages and liabilities of whatsoever nature which may be imposed on, asserted against or incurred by the Administrative Agent in performing its duties under this Section 12.15.

12.16    Judgment Currency.  (a)  The Borrowers’ obligations hereunder and under the other Credit Documents to make payments in the applicable Approved Currency (pursuant to such Obligation, the “Obligation Currency”) shall not be discharged or satisfied by any tender or recovery pursuant to any judgment expressed in or converted into any currency other than the Obligation Currency, except to the extent that such tender or recovery results in the effective receipt by the Administrative Agent or the respective Lender of the full amount of the Obligation Currency expressed to be payable to the Administrative Agent or such Lender under this Agreement or the other Credit Documents.  If, for the purpose of obtaining or enforcing judgment against each Borrowers in any court or in any jurisdiction, it becomes necessary to convert
into or from any currency other than the Obligation Currency (such other currency being hereinafter referred to as the “Judgment Currency”) an amount due in the Obligation Currency, the conversion shall be made at the Relevant Currency Equivalent, and, in the case of other currencies, the rate of exchange (as quoted by the Administrative Agent or if the Administrative Agent does not quote a rate of exchange on such currency, by a known dealer in such currency designated by the Administrative Agent) determined, in each case, as of the Business Day immediately preceding the day on which the judgment is given (such Business Day being hereinafter referred to as the “Judgment Currency Conversion Date”).

(b)        If there is a change in the rate of exchange prevailing between the Judgment Currency Conversion Date and the date of actual payment of the amount due, the Borrowers covenant and agree to pay, or cause to be paid, such additional amounts, if any (but in any event not a lesser amount) as may be necessary to ensure that the amount paid in the Judgment Currency, when converted at the rate of exchange prevailing on the date of payment, will produce the amount of the Obligation Currency which could have been purchased with the amount of Judgment Currency stipulated in the judgment or judicial award at the rate of exchange prevailing on the Judgment Currency Conversion Date.

(c)        For purposes of determining the Relevant Currency Equivalent or any other rate of exchange for this Section, such amounts shall include any premium and costs payable in connection with the purchase of the Obligation Currency.

12.17    Euro.  (a)  If at any time that an Alternate Currency Loan is outstanding, the relevant Alternate Currency is fully replaced as the lawful currency of the country that issued such Alternate Currency (the “Issuing Country”) by the Euro so that all payments are to be made in the Issuing Country in Euros and not in the Alternate Currency previously the lawful currency of such country, then such Alternate Currency Loan shall be automatically converted into a Loan denominated in Euros in a principal amount equal to the amount of Euros into which the princi

 

 

	
             
 	
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pal amount of such Alternate Currency Loan would be converted pursuant to the EMU Legislation and thereafter no further Loans will be available in such Alternate Currency, with the basis of accrual of interest, notices requirements and payment offices with respect to such converted Loans to be that consistent with the convention and practices in the London interbank market for Euro denominated Loans.

(b)The applicable Borrowers shall from time to time, at the request of any Lender, pay to such Lender the amount of any losses, damages, liabilities, claims, reduction in yield, additional expense, increased cost, reduction in any amount payable, reduction in the effective return of its capital, the decrease or delay in the payment of interest or any other return forgone by such Lender or its affiliates as a result of the tax or currency exchange resulting from the introduction, changeover to or operation of the Euro in any applicable nation or eurocurrency market.

12.18    Restatement Effective Overall Rate.  In accordance with Articles L 313-4 and R. 313-1 of the Code Monetaire et Financier of the French Republic, an estimate of the Restatement Effective Overall Rate of each Loan to be made to PartnerRe S.A. is set forth in the TEG Letter, which is incorporated herein by reference and forms part of this Agreement.

12.19    USA Patriot Act. Each Lender hereby notifies each 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 “Patriot Act”), it is required to obtain, verify and record information that identifies each Borrower, which information includes the name and address of each Borrower and other information that will allow such Lender to identify each such Borrower in accordance with the Patriot Act.

12.20    Return of Notes. Each Lender hereby agrees to return to the Company each of the Notes previously delivered to such Lender by any Borrower in connection with the Existing Credit Agreement. To the extent any Lender does not return all such Notes such Lender hereby indemnifies and holds harmless each Borrower that has not received such Notes from and against any liability which each such Borrower may sustain by reason of the loss, misplacement, destruction, theft or the failure of such Lender to return such Notes.

SECTION 13.  Company Guaranty.

13.01    The Guaranty.  In order to induce the Lenders to enter into this Agreement and to extend credit hereunder and in recognition of the direct benefits to be received by the Company from the proceeds of the Loans and the issuance of the Letters of Credit, the Company hereby agrees with the Lenders as follows:  the Company hereby unconditionally and irrevocably guarantees, as primary obligor and not merely as surety, the full and prompt payment when due, whether upon maturity, acceleration or otherwise, of any and all of the Guaranteed Obligations of each Designated Subsidiary Borrower to the Guaranteed Creditors.  If any or all of the Guaranteed Obligations of any Designated Subsidiary Borrower to the Guaranteed Creditors becomes due and payable hereunder, the Company unconditionally promises to pay such indebtedness to the Guaranteed
Creditors, or order, on demand, together with any and all expenses which may be incurred by the Guaranteed Creditors in collecting any of the Guaranteed Obligations.  This Guaranty is a guaranty of payment and not of collection.  If a claim is ever 

 

 

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

13.02    Bankruptcy.  Additionally, the Company unconditionally and irrevocably guarantees the payment of any and all of the Guaranteed Obligations of each Designated Subsidiary Borrower hereunder to the Guaranteed Creditors whether or not due or payable by each Designated Subsidiary Borrower upon the occurrence of any of the events specified in Section 9.01(g) and Section 9.01(h) with respect to such Designated Subsidiary Borrower, and unconditionally promises to pay such indebtedness to the Guaranteed Creditors, or order, on demand, in lawful money of the United States.

13.03    Nature of Liability.  The liability of the Company hereunder is exclusive and independent of any security for or other guaranty of the Guaranteed Obligations of each Designated Subsidiary Borrower whether executed by the Company, any other guarantor or by any other party, and the liability of the Company hereunder is not affected or impaired by (a) any direction as to application of payment by each Designated Subsidiary Borrower or by any other party (other than a direction by the Guaranteed Creditor receiving such payment), or (b) any other continuing or other guaranty, undertaking or maximum liability of a guarantor or of any other party as to the Guaranteed Obligations of each Designated Subsidiary Borrower, or (c) any payment on or in reduction of any such other guaranty or undertaking, or (d) any dissolution, termination or increase,
decrease or change in personnel by each Designated Subsidiary Borrower, or (e) any payment made to the Guaranteed Creditors on the Guaranteed Obligations which any such Guaranteed Creditor repays to each Designated Subsidiary Borrower pursuant to court order in any bankruptcy, reorganization, arrangement, moratorium or other debtor relief proceeding, and the Company waives any right to the deferral or modification of its obligations hereunder by reason of any such proceeding or (f) any action or inaction of the type described in Section 13.05.

13.04    Independent Obligation.  The obligations of the Company under this Section 13 are independent of the obligations of any other guarantor, any other party or each Designated Subsidiary Borrower, and a separate action or actions may be brought and prosecuted against the Company whether or not action is brought against any other guarantor, any other party or each Designated Subsidiary Borrower and whether or not any other guarantor, any other party or each Designated Subsidiary Borrower be joined in any such action or actions.  The Company waives, to the full extent permitted by law, the benefit of any statute of limitations affecting its liability under this Section 13 or the enforcement thereof.  Any payment by a Designated Subsidiary Borrower or other circumstance which operates to toll any statute of 

 

 

	
             
 	
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limitations as to a Designated Subsidiary Borrower shall operate to toll the statute of limitations as to the Company.

13.05    Authorization.   The obligations of the Company under this Section 13 shall  be unconditional and absolute and, without limiting the generality of the foregoing, shall not be released, discharged or otherwise affected by any action taken by any Guaranteed Creditor to:

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

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

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

(d)        release or substitute any one or more endorsers, guarantors, each Designated Subsidiary Borrower or other obligors;

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

(f)         apply any sums by whomsoever paid or howsoever realized to any liability or liabilities of each Designated Subsidiary Borrower to the Guaranteed Creditors regardless of what liability or liabilities of each Designated Subsidiary Borrower remain unpaid;

(g)        consent to or waive any breach of, or any act, omission or default under, this Agreement or any other Credit Document or any of the instruments or agreements referred to herein or therein, or otherwise amend, modify or supplement this Agreement, any other Credit Document or any of such other instruments or agreements; and/or

(h)        take any other action which would, under otherwise applicable principles of common law, give rise to a legal or equitable discharge of the Company from its liabilities under this Guaranty.

 

 

	
             
 	
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13.06    Reliance.  It is not necessary for the Guaranteed Creditors to inquire into the capacity or powers of each Designated Subsidiary Borrower or the officers, directors, partners or agents acting or purporting to act on their behalf, and any Guaranteed Obligations made or created in reliance upon the professed exercise of such powers shall be guaranteed hereunder.

13.07    Subordination.  Any indebtedness of each Designated Subsidiary Borrower now or hereafter owing to the Company is hereby subordinated to the Guaranteed Obligations of each Designated Subsidiary Borrower owing to the Guaranteed Creditors; and if the Administrative Agent so requests at a time when an Event of Default exists, no Designated Subsidiary Borrower shall make, or be permitted to make, any payment to the Company in respect of such indebtedness owed to the Company, but without affecting or impairing in any manner the liability of the Company under the other provisions of this Guaranty.  Prior to the transfer by the Company of any note or negotiable instrument evidencing any of the indebtedness of each Designated Subsidiary Borrower to the Company, the Company shall mark such note or negotiable instrument with a legend that the same is
subject to this subordination.  Without limiting the generality of the foregoing, the Company hereby agrees with the Guaranteed Creditors that it will not exercise any right of subrogation which it may at any time otherwise have as a result of this Guaranty (whether contractual, under Section 509 of the Bankruptcy Code or otherwise) until all Guaranteed Obligations have been irrevocably paid in full in cash.

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

(b)        The Company waives all presentments, demands for performance, protests and notices, including, without limitation, notices of nonperformance, notices of protest, notices of dishonor, notices of acceptance of this Guaranty, and notices of the existence, creation or 

 

 

	
             
 	
            80
 	
             
 

 

 

 

incurring of new or additional Guaranteed Obligations.  The Company assumes all responsibility for being and keeping itself informed of each Designated Subsidiary Borrower’s financial condition and assets, and of all other circumstances bearing upon the risk of nonpayment of the Guaranteed Obligations and the nature, scope and extent of the risks which the Company assumes and incurs hereunder, and agrees that the Guaranteed Creditors shall have no duty to advise the Company of information known to them regarding such circumstances or risks.

The Company warrants and agrees that each of the waivers set forth above is made with full knowledge of its significance and consequences, and such waivers shall be effective to the maximum extent permitted by law.

* * *

 

 

	
             
 	
            81
 	
             
 

 

 

 

 

IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of this Agreement to be duly executed and delivered as of the date first above written.

	
            PartnerRe Ltd.

Chesney House
 96 Pitts Bay Road
 Pembroke HM 08
 Bermuda
 Attention:  Joe Barbosa
 	
            PARTNERRE LTD.,
   as a Borrower 
 
 
 By  /s/ Patrick A. Thiele                                          
    
         Title: President & CEO
 
	
             
 	
             
 
	
            with a copy to:

PartnerRe Ltd.

Chesney House
 96 Pitts Bay Road
 Pembroke HM 08
 Bermuda
 Attention:  Amanda Sodergren
 	
             
 
	
             
 	
             
 
	
            Partner Reinsurance Company Ltd.

Chesney House
 96 Pitts Bay Road
 Pembroke HM 08
 Bermuda
 Attention:  Joe Barbosa
 	
            PARTNER REINSURANCE COMPANY LTD.,
   as a Borrower
 
 
 By  /s/ Albert Benchimol                                          
  
         Title: Executive Vice President & CFO
 
	
             
 	
             
 
	
            with a copy to:

Partner Reinsurance Company Ltd.

Chesney House
 96 Pitts Bay Road
 Pembroke HM 08
 Bermuda
 Attention:  Amanda Sodergren
 	
             
 
	
             
 	
             
 
	
            PartnerRe S.A.
 153, rue de Courcelles
 75817 Paris, Cedex 17
 Tel:  33(0)1 44 01 17 17
 Fax:  33(0)1 44 01 17 80
 Attention: Robert Kouba
 	
            PARTNERRE S.A.,
   as a Borrower
 
 
 By  /s/ Jean-Marie Nessi                                          
    
         Title: Chairman and CEO

 
 

 

 

	
             
 	
             
 	
             
 

 

 

 

 

 

	
            Partner Reinsurance Company of the U.S.
 1 Greenwich Plaza
 Greenwich, CT 06830

Tel:  (203) 485-4200
 Fax:  (203) 485-4300
 Attention:  John B. Wong
 	
            PARTNER REINSURANCE COMPANY OF THE U.S.,
   as a Borrower
 
 
 By  /s/ John N. Adimari                                                                                                                                                
                                                Title: Executive Vice President and Chief                                           Financial Officer
 
	
             
 	
             
 
	
            with a copy to:

Pa      e   Reinsurance Company of the U.S.
 1 Greenwich Plaza
 Greenwich, CT 06830

Attention:  Cathy A. Hauck
 	
            
 
 
 By  /s/ Cathy A. Hauck  
                                                 Title: Executive Vice President, General  Counsel and Corporate Secretary
 
	
             
 	
             
 
	
            Part  e  Re Insurance Company of New York
 1 Greenwich Plaza
 Greenwich, CT 06830

Tel:  (203) 485-4200
 Fax:  (203) 485-4300
 Attention:  John B. Wong
 	
            PARTNERRE INSURANCE COMPANY OF NEW YORK,
    as a Borrower
 
 
 By  /s/ John N. Adimari                                                                                                                                                
                                                Title: Executive Vice President and Chief                                           Financial Officer
 
	
             
 	
             
 
	
            with a copy to:

Pa      e   Reinsurance Company of New York
 1 Greenwich Plaza
 Greenwich, CT 06830

Attention:  Cathy A. Hauck
 	
            
 
 
 By  /s/ Cathy A. Hauck  
                                                 Title: Executive Vice President, General  Counsel and Corporate Secretary
 
	
            Partner   e Ireland Insurance Limited
 Ground Floor
 7 Exchange Place
 IFSC 

Dublin1

Ireland

Attention: Ted Dziurman
 	
            PARTNERRE IRELAND INSURANCE LIMITED

as a Borrower

 

 

By  /s/ Tadeusz Dziurman                                       

      Title: Director
 
	
             
 	
             

 

By  /s/ John Gerald Murphy                                    
       Title: Director
 

 

 

	
             
 	
             
 	
             
 

 

 

 

 

 

	
            Partner Reinsurance Ireland Limited
 Ground Floor
 7 Exchange Place
 IFSC 

Dublin1

Ireland

Attention: Ted Dziurman
 	
            PARTNER RE INSURANCE IRELAND LIMITED

as a Borrower

 

 

By  /s/ Tadeusz Dziurman                                       

      Title: Director
       Title:
 
	
             
 	
             

 

By  /s/ John Gerald Murphy                                    
       Title: Director
 

 

 

	
             
 	
             
 	
             
 

 

 

 

 

 

	
            JPMORGAN CHASE BANK, N.A.,
 Individually, as Issuing Agent and 
 as Administrative Agent

 
 By  /s/ Helen L. Newcomb                                         
         Title: Vice President
 

 

 

 

	
             
 	
             
 	
             
 

 

 

 

 

 

	
            SIGNATURE PAGE TO THE AMENDED AND RESTATED CREDIT AGREEMENT DATED AS OF SEPTEMBER 30, 2005, AMONG PARTNERRE LTD., VARIOUS DESIGNATED SUBSIDIARY BORROWERS, VARIOUS LENDING INSTITUTIONS AND JPMORGAN CHASE BANK, N.A., AS ADMINISTRATIVE AGENT

 

NAME OF INSTITUTION:

 

Wachovia Bank, N.A.

 

By: /s/ Kimberly Shaffer                                                                                                                                                                                                

Title: Director
 
	
             

Barclays Bank Plc

 

By: /s/ Clinton Murr                                                                                                                                                                                                                         

Title: Manager
 
	
             

Credit Suisse

 

By: /s/ Damian Hodel                                                                                                                                                                                                                

Title: Director

 

By: /s/ Petra Jaek                                                                                                                                                                                                                                       

Title: Assistant Vice President
 
	
             

HSBC Bank USA, National Association

 

By: /s/ Daniel Serrao                                                                                                                                                                                                                    

Title: Senior Vice
President
 
	
             

Bank of America, N.A.

 

By: /s/ Debra Basler                                                                                                                                                                                                                       

Title: Senior Vice President
 
	
             

Citibank, N.A.

 

By: /s/ Maria Hackley                                                                                                                                                                                                             

Title: Managing Director
 

 

 

	
             
 	
             
 	
             
 

 

 

 

 

 

	
             

Deutsche Bank AG New York Branch

 

By: /s/ John S. McGrill                                                                                                                                                        

Title: Director

 

By: /s/ Brett Harmer                                                                                                                                                                       

Title: Vice President
 
	
             

Lehman Brothers Bank, FSB

 

By: /s/ Gary T. Taylor                                                                                                                                                             

Title: Senior Vice President
 
	
             

Lloyds TSB Bank Plc

 

By: /s/ James Rudd                                                                                                                             

Title: Vice President Financial Institutions, USA

 

By: /s/ Candi Obrentz                                                                                                              

Title: Assistant Vice President, Financial                            Institutions, USA
 
	
             

The Royal Bank of Scotlac

 

By: /s/ John Mallett                                                                                                                             

Title: Head of Insurance, Financial Institutions                                           Group
 
	
             

UBS AG, Stamford Branch

 

By: /s/ Wilfred Vnt                                                                                                                                

Title: Director Banking Products Services, US

 

By: /s/ Irja R. Otsa                                                                                                                               

Title: Associate Director Banking Products Services,                                                US
 
	
             

Mellon Bank, N.A.

 

By: /s/ John M. DiMarsico                                                                                                                                 

T Assistant Vice President
 

 

 

	
             
 	
             
 	
             
 

 

 

 

 

 

	
             

National Australia Bank Limited

 

By: /s/ Michael M. McHugh                                                                                                                        

Title: Senior Vice President
 
	
             

Standard Chartered Bank

 

By: /s/ James Conti                                                                                                                                                                             

Title: Vice President 

 

By: /s/ Robert Reddington                                                                                                                                    

Title: Assistant Vice President
 

 

 

	
             
 	
             
 	
             
 

 

 

ANNEX I

 

 

COMMITMENTS

 

	
            Lenders
 	
            Commitment
 
	
            JPMorgan Chase Bank, N.A.
 	
            $70,000,000
 
	
            Wachovia Bank, N.A.
 	
            60,000,000
 
	
            Barclays Bank Plc
 	
            60,000,000
 
	
            Credit Suisse
 	
            60,000,000
 
	
            HSBC Bank USA, National Association
 	
            60,000,000
 
	
            Bank of America, N.A.
 	
            60,000,000
 
	
            Citibank, N.A.
 	
            40,000,000
 
	
            Deutsche Bank AG New York Branch
 	
            40,000,000
 
	
            Lehman Brothers Bank, FSB
 	
            40,000,000
 
	
            Lloyds TSB Bank Plc
 	
            40,000,000
 
	
            The Royal Bank of Scotland Plc
 	
            40,000,000
 
	
            UBS AG, Stamford Branch
 	
            40,000,000
 
	
            Mellon Bank, N.A.
 	
            25,000,000
 
	
            National Australia Bank Ltd.
 	
            25,000,000
 
	
            Standard Chartered Bank
 	
            25,000,000
 
	
            The Bank of Nova Scotia
 	
            15,000,000
 
	
            Total
 	
            $700,000,000
 

 

 

 

	
             
 	
             
 	
             
 

 

 

ANNEX II

 

 

LENDER ADDRESSES

 

 

	
            JPMorgan Chase Bank, N.A.
 	
            270 Park Avenue 

New York, NY 10017

Attention: Helen Newcomb

Tel: 212-270-6260 

Fax: 212-270-1511
 
	
             
 	
             
 
	
            Wachovia Bank, N.A.
 	
            301 South College Street 

Charlotte, NC 28288 

Attention: Karen Hanke 

Tel: 704-374-3061 

Fax: 704-383-1625
 
	
             
 	
             
 
	
            Barclays Bank Plc
 	
            5 The North Colonnade 

London, United Kingdom EC14 4BB Attention: Graham Smart 

Tel: +44-20-7773-6450 

Fax: +44-20-7773-6807
 
	
             
 	
             
 
	
            Credit Suisse
 	
            Bleicherweg 72 

Zurich, Switzerland CH 8070 Attention: Damian Hodel 

Tel: 41-1333-2379

Fax: 41-1333-4041
 
	
             
 	
             
 
	
            HSBC Bank USA, N.A.
 	
            452 Fifth Avenue, Tower 5 

New York, NY 10018

Attention: Daniel Serrao 

Tel: 212-525-5829  

Fax: 212-525-2570
 
	
             
 	
             
 
	
            Bank of America, N.A.
 	
            231 S. LaSalle St. 

Chicago, IL 60604

Attention: Debra Basler 

Tel: 312-828-3734 

Fax: 312-628-3600
 
	
             
 	
             
 
	
            Citibank, N.A.
 	
            388 Greenwich St., 23rd Floor 

New York, NY 10005

Attention: Michael Taylor 

Tel: 212-816-4033 

Fax: 212-816-4144
 
	
             
 	
             
 

 

 

 

	
             
 	
             
 	
             
 

 

 

 

 

 

	
            Deutsche Bank AG New York Branch
 	
            60 Wall St., Mail Stop. NYC60-2509 New York, NY 10005 

Attention: Ruth Leung

Tel: 212-250-8650 

Fax: 212-797-0270 
 
	
             
 	
             
 
	
            Lehman Brothers Commercial Bank
 	
            c/o Lehman Brothers
 745 7th Avenue, 5th  Floor 

New York, NY 10019 

Attention: Janine Shugan 

Tel: 212-526-8625 

Fax: 917-522-0139
 
	
             
 	
             
 
	
            Lloyds TSB Bank Plc
 	
            1251 Avenue of the Americas, 39th Fl. New York, NY 10020

Attention: Jason Eperon

Tel: 212-930-5031

Fax: 212-930-5098
 
	
             
 	
             
 
	
            The Royal Bank of Scotland Plc
 	
            9th Floor, 280 Bishopsgate

London EC2M 4RB, UK 

Attention: John Mallet

Tel: +44(0)20-7672-1042 

Fax: +44(0)20-7672-1073
 
	
             
 	
             
 
	
            UBS AG, Stamford Branch
 	
            677 Washington Blvd.

Stamford, CT 06901

Attention: Denise Conzo

Tel: 203-719-3853

Fax: 203-719-3888  
 
	
             
 	
             
 
	
            Mellon Bank, N.A.
 	
            One Mellon Center

Room 4505 

Pittsburgh, PA 15258 

Attention: Karla K. Maloof 

Tel: 412-236-4147

Fax: 412-234-8087
 
	
             
 	
             
 
	
            National Australia Bank Ltd.
 	
            C AND IFS Support Group 

88 Wood Street Yeard 

London, England EC2V 7QQ Attention: Ray Catt

Tel: 44-20-7710-2139

Fax: 44-20-7410-0237
 
	
             
 	
             
 

 

 

 

	
             
 	
            (ii)
 	
             
 

 

 

 

 

 

	
            Standard Chartered Bank
 	
            One Madison Avenue 

New York, NY 10010-3603

Attention: Robert Gilbert

Tel: 212-667-0493 

Fax: 212-667-0273
 
	
             
 	
             
 
	
            The Bank of Nova Scotia
 	
            One Liberty Plaza 

New York, NY 10006

Attention: Fred Guanich

Tel: 212-225-5381 

Fax: 212-225-5709
 
	
             
 	
             
 

                

 

 

 

 

	
             
 	
            (iii)
 	
             
 

 

 

ANNEX III

 

 

SUBSIDIARIES

	
             
 	
            % Bene-ficial
 Owner-ship by
 Imme-diate
 Parent
 	
            Jurisdiction
 of
 Incorporation
 
	
            PartnerRe Ltd.
 	
            —
 	
            Bermuda
 
	
            Partner Reinsurance Company Ltd
 	
            100
 	
            Bermuda
 
	
            PartnerRe Servicios Y Compania Limitada (1)
 	
            99
 	
            Chile
 
	
            PARC GmbH & Co KG
 	
            100
 	
            Germany
 
	
            PARC Service GmbH
 	
            100
 	
            Germany
 
	
            Quantitative Strategies Bermuda Ltd.
 	
            100
 	
            Bermuda
 
	
            Quantitative Strategies, LLC
 	
            100
 	
            United States
 
	
            PartnerRe Services Ltd
 	
            100
 	
            Bermuda
 
	
            PartnerRe UK Holdings Limited
 	
            100
 	
            United Kingdom
 
	
            PartnerRe (Curacao) N.V
 	
            100
 	
            Netherlands Antilles
 
	
            PartnerRe Holdings B.V
 	
            100
 	
            Netherlands
 
	
            PartnerRe Holdings SA(2)
 	
            70
 	
            France
 
	
            PartnerRe SA
 	
            100
 	
            France
 
	
            PartnerRe U.S. Corporation(4)
 	
            66
 	
            United States
 
	
            Partner Reinsurance Company of the U.S
 	
            100
 	
            United States
 
	
            PartnerRe Insurance Company of New York
 	
            100
 	
            United States
 
	
            Transat Madison Corp.
 	
            100
 	
            United States
 
	
            PartnerRe Asset Management Corporation
 	
            100
 	
            United States
 
	
            PartnerRe New Solutions Inc
 	
            100
 	
            United States
 
	
            PartnerRe Finance I Inc
 	
            100
 	
            United States
 
	
            PartnerRe Capital Trust I
 	
            100
 	
            United States
 
	
            PartnerRe Finance II Inc
 	
            100
 	
            United States
 
	
            PartnerRe Capital Trust II
 	
            100
 	
            United States
 
	
            PartnerRe Capital Trust III
 	
            100
 	
            United States
 
	
            SCI Francoreas
 	
            100
 	
            France
 
	
            Coresa (3)
 	
            91
 	
            Luxembourg
 
	
            PartnerRe Holdings Ireland Limited
 	
            100
 	
            Ireland
 
	
            PartnerRe Ireland Insurance Limited 
 	
            100
 	
            Ireland
 
	
            Partner Reinsurance Ireland Limited
 	
            100
 	
            Ireland
 

 

	
            (1)
 	
            Partner Reinsurance Company Ltd holds 99% of PartnerRe Servicios Y Compania Limitada shares and PartnerRe Services Ltd holds the remaining 1%.
 

 

 

 

	
             
 	
             
 	
             
 

 

 

 

 

	
            (2)
 	
            PartnerRe Holdings B.V holds 70% of PartnerRe Holdings SA, Partner Reinsurance Company Ltd. holds 16% of PartnerRe Holdings SA and PartnerRe (Curacao) N.V holds the remaining 14%.
 

 

	
            (3)
 	
            SCI Francoreas holds 91% of Coresa shares and PartnerRe SA holds the remaining 9%.
 

 

	
            (4)
 	
            PartnerRe (Curacao) N.V holds 66% of PartnerRe U.S. Corporation and PartnerRe Ltd. holds the remaining 34%.
 

 

 

	
             
 	
            (v)
 	
             
 

 

 

ANNEX IV

 

 

 

INDEBTEDNESS

 

(in US$ millions)

 

	
            Long term debt consisting of a fully collateralized fixed rate 
 	
             
 
	
            loan repayable in 2008.                                                                                                                                                                                                                                                            
 	
            $220.0
 

 

 

 

	
             
 	
             
 	
             
 

 

 

ANNEX V

 

 

LIENS

(in US$ millions)

New York State Reg. 114 Trusts supporting reinsurance obligations to: 

	
             
	
            Unrelated third party U.S. ceding company clients
 	
            $112.7
 
	
             
	
            PartnerRe Ltd.’s wholly-owned U.S. reinsurance subsidiaries  
 	
            382.1
 
	
            Invested assets pledged in favor of ceding company clients
 	
            791.9
 
	
            Statutory deposits held with U.S. state insurance regulators
 	
            14.0
 
	
            Collateral supporting long term debt (see Annex IV)
 	
            251.5
 
					

 

	
            $1,552.2
 

 

 

 

 

	
             
 	
             
 	
             
 

 

 

 

 

ANNEX VI

 

EXISTING FRONTED LETTERS OF CREDIT  

 

	
            BERMUDA
 	
             
 	
             

PARTNER REINSURANCE COMPANY LTD.
 	
             
 
	
            L/C Number
 	
            LC Amount 
 	
            CCY
 	
            Issue Date
 	
            Expiry Date
 
	
            U-620521
 	
            $         1,010,986.14 
 	
            USD
 	
             
 	
            31-Dec-05
 
	
            U-620677
 	
            $              37,133.79 
 	
            USD
 	
             
 	
            31-Dec-05
 
	
            U-624075
 	
            $              29,258.06 
 	
            USD
 	
             
 	
            31-May-06
 
	
            TOTAL
 	
            $         1,077,377.99 
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 	
             
 
	
            FRANCE
 	
            444403973
 	
             
 	
            PARTNER RE SA
 	
             
 
	
            L/C Number
 	
            LC Amount 
 	
            CCY
 	
            Issue Date
 	
            Expiry Date
 
	
            U-249979
 	
            ZAR 30,857,920.00
 	
            ZAR
 	
             
 	
            30-Oct-06
 
	
            TOTAL
 	
            USD 4,837,574.47
 	
             
 	
             
 	
             
 

 

 

 

	
             
 	
             
 	
             
 

 

 

 

 

ANNEX VII

 

EXISTING SEVERAL LETTERS OF CREDIT

 

	
            USA
 	
            444403951
 	
             
 	
            PARTNER REINSURANCE COMPANY OF THE US
 	
             
 
	
            L/C Number
 	
            LC Amount
 	
            CCY
 	
            Issue Date
 	
            Expiry Date
 
	
            U-793796
 	
            $            375,884.00
 	
            USD
 	
            1-Aug-05
 	
            30-Sep-06
 
	
            TOTAL
 	
            $            375,884.00
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 	
             
 
	
            FRANCE
 	
            444403973
 	
             
 	
            PARTNER RE SA
 	
             
 
	
            L/C Number
 	
            LC Amount
 	
            CCY
 	
            Issue Date
 	
            Expiry Date
 
	
            U-229744
 	
            $                3,092.09
 	
            USD
 	
            8-Aug-05
 	
            31-Dec-05
 
	
            U-229745
 	
            $              46,512.40
 	
            USD
 	
            9-Aug-04
 	
            31-Dec-05
 
	
            U-229747
 	
            $         1,365,605.90
 	
            USD
 	
            12-Jul-05
 	
            31-Dec-05
 
	
            U-229749
 	
            $            530,987.71
 	
            USD
 	
            22-Jul-05
 	
            31-Dec-05
 
	
            U-229750
 	
            $            220,185.08
 	
            USD
 	
            24-Mar-05
 	
            31-Dec-05
 
	
            U-229751
 	
            $         5,086,556.33
 	
            USD
 	
            18-Apr-05
 	
            31-Dec-05
 
	
            U-229752
 	
            $         9,100,000.00
 	
            USD
 	
            24-Mar-05
 	
            31-Dec-05
 
	
            U-229763
 	
            $            272,334.00
 	
            USD
 	
            29-Jul-05
 	
            31-Dec-05
 
	
            U-229766
 	
            $            185,030.00
 	
            USD
 	
            25-Mar-05
 	
            31-Dec-05
 
	
            U-229769
 	
            $            150,000.00
 	
            USD
 	
            9-Aug-04
 	
            31-Dec-05
 
	
            U-229773
 	
            $         4,805,272.30
 	
            USD
 	
            21-Jun-05
 	
            31-Dec-05
 
	
            U-229774
 	
            $              16,260.10
 	
            USD
 	
            2-Mar-05
 	
            31-Dec-05
 
	
            U-229776
 	
            $              72,970.00
 	
            USD
 	
            30-Mar-05
 	
            31-Dec-05
 
	
            U-229777
 	
            $                5,523.47
 	
            USD
 	
            29-Mar-05
 	
            31-Dec-05
 
	
            U-229778
 	
            $                7,356.19
 	
            USD
 	
            30-Mar-05
 	
            31-Dec-05
 
	
            U-229779
 	
            $                8,682.81
 	
            USD
 	
            13-May-05
 	
            31-Dec-05
 
	
            U-229780
 	
            $            184,376.00
 	
            USD
 	
            2-Mar-05
 	
            31-Dec-05
 
	
            U-229781
 	
            $            208,747.00
 	
            USD
 	
            25-Mar-05
 	
            31-Dec-05
 
	
            U-229782
 	
            $                8,700.00
 	
            USD
 	
            13-Jul-05
 	
            31-Dec-05
 
	
            U-229783
 	
            $                6,303.81
 	
            USD
 	
            9-Aug-04
 	
            31-Dec-05
 
	
            U-229784
 	
            $              12,881.32
 	
            USD
 	
            25-Mar-05
 	
            31-Dec-05
 
	
            U-229785
 	
            $            720,146.56
 	
            USD
 	
            18-Apr-05
 	
            31-Dec-05
 

 

 

 

	
             
 	
             
 	
             
 

 

 

 

 

 

	
            U-229797
 	
            $              19,156.77
 	
            USD
 	
            2-Mar-05
 	
            31-Dec-05
 
	
            U-229798
 	
            $         1,027,618.94
 	
            USD
 	
            23-Aug-05
 	
            31-Dec-05
 
	
            U-229800
 	
            $              26,863.00
 	
            USD
 	
            30-Mar-05
 	
            31-Dec-05
 
	
            U-229801
 	
            $         2,361,800.00
 	
            USD
 	
            2-Mar-05
 	
            31-Dec-05
 
	
            U-229802
 	
            $            404,298.00
 	
            USD
 	
            2-Mar-05
 	
            31-Dec-05
 
	
            U-229803
 	
            $            466,900.00
 	
            USD
 	
            2-Mar-05
 	
            31-Dec-05
 
	
            U-229804
 	
            $              10,032.68
 	
            USD
 	
            7-Apr-05
 	
            31-Dec-05
 
	
            U-229805
 	
            $            106,232.00
 	
            USD
 	
            9-Aug-04
 	
            31-Dec-05
 
	
            U-229817
 	
            $            167,280.83
 	
            USD
 	
            29-Mar-05
 	
            31-Dec-05
 
	
            U-229818
 	
            $                1,713.37
 	
            USD
 	
            2-Mar-05
 	
            31-Dec-05
 
	
            U-229821
 	
            $            546,768.00
 	
            USD
 	
            2-Mar-05
 	
            31-Dec-05
 
	
            U-229825
 	
            $            361,893.00
 	
            USD
 	
            30-Mar-05
 	
            31-Dec-05
 
	
            U-229827
 	
            $            898,000.00
 	
            USD
 	
            2-Mar-05
 	
            31-Dec-05
 
	
            U-229829
 	
            $            468,968.00
 	
            USD
 	
            25-Mar-05
 	
            31-Dec-05
 
	
            U-229830
 	
            $              30,002.67
 	
            USD
 	
            2-Mar-05
 	
            31-Dec-05
 
	
            U-229832
 	
            $              14,367.59
 	
            USD
 	
            2-Mar-05
 	
            31-Dec-05
 
	
            U-229839
 	
            $              12,196.32
 	
            USD
 	
            4-Mar-05
 	
            31-Dec-05
 
	
            U-229842
 	
            $              10,124.00
 	
            USD
 	
            9-Aug-04
 	
            31-Dec-05
 
	
            U-229843
 	
            $              14,741.00
 	
            USD
 	
            23-Aug-05
 	
            31-Dec-05
 
	
            U-229844
 	
            $            827,148.00
 	
            USD
 	
            25-May-05
 	
            31-Dec-05
 
	
            U-229846
 	
            $              99,516.00
 	
            USD
 	
            26-Jul-05
 	
            31-Dec-05
 
	
            U-229847
 	
            $              40,000.00
 	
            USD
 	
            9-Aug-04
 	
            31-Dec-05
 
	
            U-229852
 	
            $            654,122.00
 	
            USD
 	
            17-Jun-05
 	
            31-Dec-05
 
	
            U-229854
 	
            $                  556.38
 	
            USD
 	
            1-Mar-05
 	
            30-Nov-05
 
	
            U-229855
 	
            $                  445.11
 	
            USD
 	
            14-Feb-05
 	
            30-Nov-05
 
	
            U-229862
 	
            $              13,244.77
 	
            USD
 	
            30-Mar-05
 	
            31-Dec-05
 
	
            U-233278
 	
            $            554,817.38
 	
            USD
 	
            12-Apr-05
 	
            31-Dec-05
 
	
            U-234365
 	
            $              38,081.64
 	
            USD
 	
            2-Mar-05
 	
            31-Dec-05
 
	
            U-234366
 	
            $         2,540,551.56
 	
            USD
 	
            1-Apr-05
 	
            31-Dec-05
 
	
            U-243885
 	
            $            528,429.48
 	
            USD
 	
            4-Mar-05
 	
            31-Dec-05
 
	
            U-250577
 	
            $              45,406.00
 	
            USD
 	
            15-Aug-05
 	
            31-Dec-05
 
	
            U-250578
 	
            $         4,586,016.00
 	
            USD
 	
            28-Jun-05
 	
            31-Dec-05
 
	
            U-250579
 	
            $              28,268.92
 	
            USD
 	
            2-Mar-05
 	
            31-Dec-05
 
	
            U-618377
 	
            $            707,090.64
 	
            USD
 	
            24-Mar-05
 	
            31-Dec-05
 
	
            U-619772
 	
            $        14,575,485.00
 	
            USD
 	
            24-Mar-05
 	
            31-Dec-05
 
	
            TOTAL
 	
            $        55,205,658.12
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 	
             
 
	
            BERMUDA
 	
            444403976
 	
             
 	
            PARTNER REINSURANCE COMPANY LTD.
 	
             
 
	
            L/C Number
 	
            LC Amount
 	
            CCY
 	
            Issue Date
 	
            Expiry Date
 
	
            U-228083
 	
            $         8,460,000.00
 	
            USD
 	
            7-Jul-05
 	
            31-Dec-05
 
	
            U-228084
 	
            $              46,328.36
 	
            USD
 	
            14-Feb-05
 	
            31-Dec-05
 

 

 

 

	
             
 	
             
 	
             
 

 

 

 

 

 

	
            U-228085
 	
            $        23,008,604.30
 	
            USD
 	
            26-Apr-05
 	
            31-Dec-05
 
	
            U-229053
 	
            $              59,514.00
 	
            USD
 	
            14-Feb-05
 	
            31-Dec-05
 
	
            U-229054
 	
            $              28,735.53
 	
            USD
 	
            14-Feb-05
 	
            31-Dec-05
 
	
            U-229055
 	
            $                5,273.25
 	
            USD
 	
            14-Feb-05
 	
            31-Dec-05
 
	
            U-229056
 	
            $            236,938.16
 	
            USD
 	
            14-Feb-05
 	
            31-Dec-05
 
	
            U-229057
 	
            $              18,672.70
 	
            USD
 	
            18-Mar-05
 	
            31-Dec-05
 
	
            U-229058
 	
            $                1,755.03
 	
            USD
 	
            14-Feb-05
 	
            31-Dec-05
 
	
            U-229061
 	
            $            210,834.36
 	
            USD
 	
            9-Aug-04
 	
            31-Dec-05
 
	
            U-229083
 	
            $            268,245.99
 	
            USD
 	
            9-Aug-04
 	
            31-Dec-05
 
	
            U-229088
 	
            $            839,608.65
 	
            USD
 	
            18-Mar-05
 	
            31-Dec-05
 
	
            U-229091
 	
            $              10,816.18
 	
            USD
 	
            14-Feb-05
 	
            31-Dec-05
 
	
            U-229092
 	
            $              16,779.40
 	
            USD
 	
            11-Apr-05
 	
            31-Dec-05
 
	
            U-229094
 	
            $                4,222.56
 	
            USD
 	
            9-Aug-04
 	
            31-Dec-05
 
	
            U-229095
 	
            $         4,626,470.11
 	
            USD
 	
            9-Aug-04
 	
            31-Dec-05
 
	
            U-614421
 	
            $         4,511,785.05
 	
            USD
 	
            2-Sep-05
 	
            1-Nov-06
 
	
            U-617248
 	
            $         1,329,369.62
 	
            USD
 	
            26-Apr-05
 	
            31-Dec-05
 
	
            U-617249
 	
            $         3,520,374.40
 	
            USD
 	
            26-Apr-05
 	
            31-Dec-05
 
	
            U-617544
 	
            $         2,631,125.00
 	
            USD
 	
            18-Mar-05
 	
            31-Dec-05
 
	
            U-617847
 	
            $        33,002,956.00
 	
            USD
 	
            18-Mar-05
 	
            31-Dec-05
 
	
            U-618601
 	
            $         3,102,508.35
 	
            USD
 	
            18-Mar-05
 	
            31-Dec-05
 
	
            U-618654
 	
            $            496,550.24
 	
            USD
 	
            26-Apr-05
 	
            31-Dec-05
 
	
            U-619074
 	
            $         1,378,162.26
 	
            USD
 	
            26-Apr-05
 	
            31-Dec-05
 
	
            U-619546
 	
            $            733,347.06
 	
            USD
 	
            26-Apr-05
 	
            31-Dec-05
 
	
            U-619547
 	
            $              74,764.99
 	
            USD
 	
            26-Apr-05
 	
            31-Dec-05
 
	
            U-619550
 	
            $            120,645.62
 	
            USD
 	
            26-Apr-05
 	
            31-Dec-05
 
	
            U-619551
 	
            $            325,165.38
 	
            USD
 	
            26-Apr-05
 	
            31-Dec-05
 
	
            U-619920
 	
            $              94,336.94
 	
            USD
 	
            26-Apr-05
 	
            31-Dec-05
 
	
            U-620351
 	
            $            101,318.50
 	
            USD
 	
            7-Feb-05
 	
            31-Dec-05
 
	
            U-620939
 	
            $              70,407.75
 	
            USD
 	
            27-May-05
 	
            31-Dec-05
 
	
            U-624094
 	
            $            189,375.00
 	
            USD
 	
            26-Apr-05
 	
            31-Mar-06
 
	
            U-785009
 	
            $                8,688.62
 	
            USD
 	
            25-Mar-05
 	
            15-Nov-06
 
	
            U-785170
 	
            $         4,709,752.25
 	
            USD
 	
            18-Mar-05
 	
            15-Nov-06
 
	
            U-785338
 	
            $         1,056,120.54
 	
            USD
 	
            22-Dec-04
 	
            15-Nov-06
 
	
            U-785833
 	
            $         1,306,971.45
 	
            USD
 	
            18-Mar-05
 	
            31-Dec-05
 
	
            U-786178
 	
            $              40,636.44
 	
            USD
 	
            9-Aug-04
 	
            31-Dec-05
 
	
            U-786185
 	
            $              50,122.81
 	
            USD
 	
            18-Mar-05
 	
            31-Dec-05
 
	
            U-794628
 	
            $              17,324.34
 	
            USD
 	
            9-Aug-04
 	
            31-Dec-05
 
	
            U-795697
 	
            $              26,882.27
 	
            USD
 	
            9-Aug-04
 	
            31-Dec-05
 
	
            U-795903
 	
            $              46,012.50
 	
            USD
 	
            21-Jun-05
 	
            31-May-06
 
	
            U-796007
 	
            $                8,268.85
 	
            USD
 	
            18-Mar-05
 	
            31-Dec-05
 
	
            U-796363
 	
            $                6,404.34
 	
            USD
 	
            14-Feb-05
 	
            31-Dec-05
 
	
            U-796395
 	
            $        16,265,307.75
 	
            USD
 	
            6-Sep-05
 	
            31-Dec-05
 
	
            U-796448
 	
            $         6,435,592.00
 	
            USD
 	
            24-Aug-05
 	
            31-Dec-05
 
	
            U-796450
 	
            $         3,811,465.15
 	
            USD
 	
            6-Sep-05
 	
            31-Dec-05
 
	
            U-796451
 	
            $        19,685,991.00
 	
            USD
 	
            26-Jul-05
 	
            31-Dec-05
 
	
            U-796453
 	
            $         4,167,080.00
 	
            USD
 	
            18-Mar-05
 	
            31-Dec-05
 

 

 

 

	
             
 	
             
 	
             
 

 

 

 

 

 

	
            TOTAL
 	
            $      147,167,611.05
 	
             
 	
             
 	
             
 

 

 

 

	
             
 	
             
 	
             
 

 

 

 

 

TABLE OF CONTENTS

	
            Page
 

 

 

 

	
             
 	
            (i)
 	
             
 

 

 

 

 

	
            SECTION 1.
 	
            Amount and Terms of Credit
 	
            1
 
	
             
	
            1.01
 	
            Commitment
 	
            1
 
	
             
	
            1.02
 	
            Minimum Borrowing Amounts, etc.
 	
            2
 
	
             
	
            1.03
 	
            Notice of Borrowing of Revolving Loans
 	
            2
 
	
             
	
            1.04
 	
            Competitive Bid Borrowings
 	
            2
 
	
             
	
            1.05
 	
            Disbursement of Funds
 	
            4
 
	
             
	
            1.06
 	
            Notes
 	
            5
 
	
             
	
            1.07
 	
            Conversions
 	
            5
 
	
             
	
            1.08
 	
            Pro Rata Borrowings, etc.
 	
            6
 
	
             
	
            1.09
 	
            Interest
 	
            6
 
	
             
	
            1.10
 	
            Interest Periods
 	
            7
 
	
             
	
            1.11
 	
            Increased Costs, Illegality, etc.
 	
            8
 
	
             
	
            1.12
 	
            Compensation
 	
            11
 
	
             
	
            1.13
 	
            Change of Lending Office
 	
            11
 
	
             
	
            1.14
 	
            Replacement of Lenders
 	
            11
 
	
             
	
            1.15
 	
            Designated Subsidiary Borrowers
 	
            12
 
	
             
	
            1.16
 	
            Additional Commitments
 	
            13
 
	
            SECTION 2.
 	
            Letters of Credit
 	
            16
 
	
             
	
            2.01
 	
            Several Letters of Credit
 	
            16
 
	
             
	
            2.02
 	
            Fronted Letters of Credit
 	
            17
 
	
             
	
            2.03
 	
            Conditions to the Issuance of all Letters of Credit
 	
            20
 
	
             
	
            2.04
 	
            Letter of Credit Requests
 	
            21
 
	
             
	
            2.05
 	
            Agreement to Repay Letter of Credit Drawings
 	
            22
 
	
             
	
            2.06
 	
            Increased Costs
 	
            22
 
	
             
	
            2.07
 	
            Letter of Credit Expiration Extensions
 	
            23
 
	
             
	
            2.08
 	
            Changes to Stated Amount
 	
            23
 
	
             
	
            2.09
 	
            Confirming Letters of Credit
 	
            24
 
	
             
	
            2.10
 	
            Existing Fronted Letters of Credit.
 	
            24
 
	
             
	
            2.11
 	
            Existing Several Letters of Credit
 	
            24
 
	
            SECTION 3.
 	
            Fees; Commitments
 	
            26
 
	
             
	
            3.01
 	
            Fees
 	
            26
 
	
             
	
            3.02
 	
            Voluntary Reduction of Commitments
 	
            27
 
	
             
	
            3.03
 	
            Mandatory Reduction of Commitments
 	
            28
 
	
            SECTION 4.
 	
            Payments
 	
            28
 
	
             
	
            4.01
 	
            Voluntary Prepayments
 	
            28
 
	
             
	
            4.02
 	
            Mandatory Prepayments
 	
            28
 
	
             
	
            4.03
 	
            Method and Place of Payment
 	
            29
 
	
             
	
            4.04
 	
            Net Payments
 	
            30
 
	
            SECTION 5.
 	
            Conditions Precedent
 	
            32
 
	
             
	
            5.01
 	
            Conditions Precedent to Restatement Effective Date
 	
            32
 
	
             
	
            5.02
 	
            Conditions Precedent to All Loans and Letters of Credit
 	
            34
 
					

 

 

 

	
             
 	
            (ii)
 	
             
 

 

 

 

 

	
            SECTION 6.
 	
            Representations, Warranties and Agreements
 	
            35
 
	
             
	
            6.01
 	
            Corporate Existence and Power
 	
            35
 
	
             
	
            6.02
 	
            Corporate and Governmental Authorization; No Contravention
 	
            35
 
	
             
	
            6.03
 	
            Enforceability
 	
            35
 
	
             
	
            6.04
 	
            Financial Information
 	
            36
 
	
             
	
            6.05
 	
            Litigation
 	
            36
 
	
             
	
            6.06
 	
            Tax Returns and Payments
 	
            36
 
	
             
	
            6.07
 	
            Indebtedness
 	
            37
 
	
             
	
            6.08
 	
            Insurance Licenses
 	
            37
 
	
             
	
            6.09
 	
            Intellectual Property
 	
            37
 
	
             
	
            6.10
 	
            Not an Investment Company
 	
            37
 
	
             
	
            6.11
 	
            Public Utility Holding Company Act
 	
            37
 
	
             
	
            6.12
 	
            Ownership of Property; Liens
 	
            37
 
	
             
	
            6.13
 	
            No Default
 	
            37
 
	
             
	
            6.14
 	
            Full Disclosure
 	
            37
 
	
             
	
            6.15
 	
            Compliance with Laws
 	
            37
 
	
             
	
            6.16
 	
            Capital Stock
 	
            38
 
	
             
	
            6.17
 	
            Compliance with ERISA
 	
            38
 
	
             
	
            6.18
 	
            Margin Stock
 	
            38
 
	
             
	
            6.19
 	
            Subsidiaries
 	
            38
 
	
             
	
            6.20
 	
            Use of Proceeds
 	
            38
 
	
            SECTION 7.
 	
            Affirmative Covenants
 	
            38
 
	
             
	
            7.01
 	
            Information Covenants
 	
            39
 
	
             
	
            7.02
 	
            Books, Records and Inspections
 	
            40
 
	
             
	
            7.03
 	
            Maintenance of Existence
 	
            41
 
	
             
	
            7.04
 	
            ERISA
 	
            41
 
	
             
	
            7.05
 	
            Insurance
 	
            41
 
	
             
	
            7.06
 	
            Maintenance of Property
 	
            42
 
	
             
	
            7.07 Payment of Taxes
 	
            42
 
	
            SECTION 8.
 	
            Negative Covenants
 	
            42
 
	
             
	
            8.01
 	
            Liens
 	
            42
 
	
             
	
            8.02
 	
            Dissolution
 	
            43
 
	
             
	
            8.03
 	
            Consolidations, Mergers, Sales of Assets and Acquisitions
 	
            43
 
	
             
	
            8.04
 	
            Use of Proceeds
 	
            44
 
	
             
	
            8.05
 	
            Transactions with Affiliates
 	
            44
 
	
             
	
            8.06
 	
            Indebtedness
 	
            44
 
	
             
	
            8.07
 	
            Private Act
 	
            44
 
	
             
	
            8.08
 	
            Restricted Payments
 	
            45
 
	
             
	
            8.09
 	
            Business
 	
            45
 
	
             
	
            8.10
 	
            Leverage Ratio
 	
            45
 
	
             
	
            8.11
 	
            Minimum Consolidated Tangible Net Worth
 	
            45
 
	
             
	
            8.12
 	
            Claims Paying Ratings
 	
            45
 
	
            SECTION 9.
 	
            Defaults.
 	
            45
 
	
             
	
            9.01
 	
            Events of Default
 	
            45
 
	
             
	
            9.02
 	
            Notice of Default
 	
            48
 
	
            SECTION 10. Definitions
 	
            48
 
	
            SECTION
 	
             11. The Administrative Agent
 	
            66
 
	
             
	
            11.01
 	
            Appointment
 	
            66
 
	
             
	
            11.02
 	
            Nature of Duties
 	
            66
 
	
             
	
            11.03
 	
            Lack of Reliance on the Administrative Agent
 	
            67
 
	
             
	
            11.04
 	
            Certain Rights of the Administrative Agent
 	
            67
 
	
             
	
            11.05
 	
            Reliance
 	
            67
 
	
             
	
            11.06
 	
            Indemnification
 	
            68
 
	
             
	
            11.07
 	
            The Administrative Agent’s Individual Capacities
 	
            68
 
	
             
	
            11.08
 	
            Holders
 	
            68
 
	
             
	
            11.09
 	
            Resignation by the Administrative Agent
 	
            68
 
	
            SECTION 12. Miscellaneous
 	
            69
 
	
             
	
            12.01
 	
            Payment of Expenses, etc
 	
            69
 
	
             
	
            12.02
 	
            Right of Setoff
 	
            70
 
	
             
	
            12.03
 	
            Notices
 	
            70
 
	
             
	
            12.04
 	
            Benefit of Agreement
 	
            70
 
	
             
	
            12.05
 	
            No Waiver; Remedies Cumulative
 	
            72
 
	
             
	
            12.06
 	
            Payments Pro Rata
 	
            72
 
	
             
	
            12.07
 	
            Calculations; Computations
 	
            72
 
	
             
	
            12.08
 	
            Governing Law; Submission to Jurisdiction; Venue; Waiver of Jury Trial
 	
            73
 
	
             
	
            12.09
 	
            Counterparts
 	
            74
 
	
             
	
            12.10
 	
            Headings Descriptive
 	
            74
 
	
             
	
            12.11
 	
            Amendment or Waiver
 	
            74
 
	
             
	
            12.12
 	
            Survival
 	
            75
 
	
             
	
            12.13
 	
            Domicile of Loans
 	
            75
 
	
             
	
            12.14
 	
            Confidentiality
 	
            75
 
	
             
	
            12.15
 	
            Registry
 	
            75
 
	
             
	
            12.16
 	
            Judgment Currency
 	
            76
 
	
             
	
            12.17
 	
            Euro
 	
            76
 
	
             
	
            12.18
 	
            Restatement Effective Overall Rate
 	
            77
 
	
             
	
            12.19
 	
            USA Patriot Act.
 	
            77
 
	
             
	
            12.20
 	
            Return of Notes.
 	
            77
 
	
            SECTION 13. Company Guaranty
 	
            77
 
	
             
	
            13.01
 	
            The Guaranty
 	
            77
 
	
             
	
            13.02
 	
            Bankruptcy
 	
            78
 
	
             
	
            13.03
 	
            Nature of Liability
 	
            78
 
	
             
	
            13.04
 	
            Independent Obligation
 	
            78
 
	
             
	
            13.05
 	
            Authorization
 	
            79
 
	
             
	
            13.06
 	
            Reliance
 	
            80
 
	
             
	
            13.07
 	
            Subordination
 	
            80
 
	
             
	
            13.08
 	
            Waiver
 	
            80
 
					

 

	
            ANNEX I
 	
            Commitments
 	
             

	
            ANNEX II
 	
            Lender Addresses
 	
             

	
            ANNEX III
 	
            Subsidiaries
 	
             

	
            ANNEX IV
 	
            Debt
 	
             

	
            ANNEX V
 	
            Liens
 	
             

	
            ANNEX VI
 	
            Existing Fronted Letters of Credit
 	
             

	
            ANNEX VII
 	
            Existing Several Letters of Credit
 	
             

	
            EXHIBIT A-1
 	
            --
 	
            Form of Notice of Borrowing
 	
             

	
            EXHIBIT A-2
 	
            --
 	
            Form of Notice of Competitive Bid Borrowing
 	
             

	
            EXHIBIT B-1
 	
            --
 	
            Form of Revolving Note
 	
             

	
            EXHIBIT B-2
 	
            --
 	
            Form of Competitive Bid Note
 	
             

	
            EXHIBIT C
 	
            --
 	
            Form of Section 4.04(b)(ii) Certificate
 	
             

	
            EXHIBIT D-1
 	
            --
 	
            Form of Opinion of Marc Wetherhill, Esq.
 	
             

	
            EXHIBIT D-2
 	
            --
 	
            Form of Opinion of Cathy A. Hauck, Esq.
 	
             

	
            EXHIBIT D-3
 	
            --
 	
            Form of Opinion of Davis Polk & Wardwell
 	
             

	
            EXHIBIT D-4
 	
            --
 	
            Form of Opinion of Davis Polk & Wardwell (Paris)
 	
             

	
            EXHIBIT D-5
 	
            --
 	
            Form of Opinion of A&L Goodbody Solicitors
 	
             

	
            EXHIBIT E
 	
            --
 	
            Form of Officers’ Certificate
 	
             

	
            EXHIBIT F
 	
            --
 	
            Form of Assignment Agreement
 	
             

	
            EXHIBIT G
 	
            --
 	
            Form of DSB Assumption Agreement
 	
             

	
            EXHIBIT H
 	
            --
 	
            Form of Opinion of Designated Subsidiary Borrowers’ Counsel
 
	
            EXHIBIT I
 	
            --
 	
            Form of Letter of Credit Request
 	
             

	
            EXHIBIT J
 	
            --
 	
            Form of Non-Continuing Lender Agreement
 	
             

	
            EXHIBIT K
 	
            --
 	
            Form of Compliance Certificate
 	
             

	
            EXHIBIT L
 	
            --
 	
            Form of Additional Commitment Agreement
 	
             

																												

 

 

 

	
             
 	
            (iii)

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00091-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00091-of-00352.parquet"}]]