Document:

Exhibit 10.19.4

 

FIRST AMENDMENT TO

NON-QUALIFIED STOCK OPTION AGREEMENT

PIER 1 IMPORTS, INC.

 

THIS
FIRST AMENDMENT TO NON-QUALIFIED STOCK OPTION AGREEMENT (“Agreement”) is
made effective and entered into as of October 6, 2008, by and between PIER
1 IMPORTS, INC., a Delaware corporation (the “Company”), and ALEXANDER
W. SMITH (the “Optionee”).

 

WHEREAS,
on February 19, 2007 the Company and Optionee entered into a Non-Qualified
Stock Option Agreement pursuant to the terms of that certain Employment
Agreement (the “Employment Agreement”) dated February 19, 2007, for
the stock option defined in the Employment Agreement as “Option 2”;

 

WHEREAS,
the Company and the Optionee desire to amend the Non-Qualified Stock Option
Agreement for Option 2:

 

NOW,
THEREFORE, the parties hereto agree as follows:

 

1.
The first paragraph of section 4 (i) of the Non-Qualified Stock Option
Agreement for Option 2 is deleted in its entirety and replaced with the
following language:

 

(i)            Term of Option; Exercisability. Unless sooner terminated
as hereinafter provided, this Option shall become vested and exercisable up to
1,000,000 Option Shares on the date of filing of the Company’s Annual Report on
Form 10-K (“Form 10-K”) with the Securities and Exchange
Commission (the “SEC”) for the fiscal year ending February 28, 2009
(such date, the “2nd Vesting Date”), based upon achieving a percentage of the fiscal 2009 EBITDA target
(the “2009 EBITDA Target”) as follows:

 

100% of the 2009 EBITDA Target –
1,000,000 shares;

 

96% of the 2009 EBITDA Target – 900,000
shares;

 

92% of the 2009 EBITDA Target - 800,000
shares;

 

88% of the 2009 EBITDA Target – 700,000
shares;

 

84% of the 2009 EBITDA Target – 600,000
shares; and

 

80% of the 2009 EBITDA Target – 500,000
shares.

 

Additionally,
vesting of shares between the fixed percentage points of the 2009 EBITDA Target
stated above shall be interpolated. In other words as an example if 94% of the
2009 EBITDA Target were achieved, then 850,000 shares of Option 2 would vest.

 

2.             Except as amended
by this Agreement, the Non-Qualified Stock Option Agreement for Option 2 is
ratified and remains unchanged. If there is a conflict between the provisions
of this Agreement and the provisions of the Non-Qualified Stock Option
Agreement for Option 2, this Agreement controls.

 

1

 

IN
WITNESS WHEREOF, the Optionee has executed this Agreement, and the Company has
caused its duly authorized corporate officer to execute this Agreement as of
the dates set forth below, to be effective the date of last signing.

 

	
  COMPANY:

  	
   

  	
  OPTIONEE:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Pier 1 Imports, Inc.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
               /S/

  	
   

  	
                            /S/

  
	
   

  	
  Michael A. Carter

  	
   

  	
  Alexander W. Smith

  
	
   

  	
  Senior V.P. and General Counsel

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date: October 3, 2008

  	
   

  	
  Date: October 6, 2008

  

 

2Exhibit 10.1

 

[EXECUTION COPY]

	
   

  

 

 

CREDIT
AGREEMENT

 

dated as of October 6, 2008

 

 

among

 

 

WADDELL & REED FINANCIAL, INC.,

 

 

THE LENDERS PARTY HERETO,

 

 

and

 

 

BANK OF AMERICA, N.A.,

as Administrative Agent

 

 

BANC OF AMERICA SECURITIES LLC,

as Lead Arranger and Book Manager

 

	
   

  

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  I

  	
  DEFINITIONS

  	
   

  	
  1

  
	
   

  	
   

  	
   

  
	
  SECTION 1.01.

  	
  Defined Terms

  	
   

  	
  1

  
	
  SECTION 1.02.

  	
  Terms Generally

  	
   

  	
  16

  
	
  SECTION 1.03.

  	
  Accounting Terms; GAAP

  	
   

  	
  17

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  II

  	
  THE CREDITS

  	
   

  	
  17

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 2.01.

  	
  Commitments

  	
   

  	
  17

  
	
  SECTION 2.02.

  	
  Loans and Borrowings

  	
   

  	
  17

  
	
  SECTION 2.03.

  	
  Requests for Borrowings, Conversions and
  Continuations of Loans

  	
   

  	
  18

  
	
  SECTION 2.04.

  	
  [Intentionally Omitted]

  	
   

  	
  19

  
	
  SECTION 2.05.

  	
  Funding of Borrowings

  	
   

  	
  19

  
	
  SECTION 2.06.

  	
  [Intentionally Omitted]

  	
   

  	
  20

  
	
  SECTION 2.07.

  	
  Termination and Reduction of Commitments

  	
   

  	
  20

  
	
  SECTION 2.08.

  	
  Repayment of Loans; Evidence of Debt

  	
   

  	
  21

  
	
  SECTION 2.09.

  	
  Prepayment of Loans

  	
   

  	
  21

  
	
  SECTION 2.10.

  	
  Fees

  	
   

  	
  22

  
	
  SECTION 2.11.

  	
  Interest

  	
   

  	
  23

  
	
  SECTION 2.12.

  	
  Alternate Rate of Interest

  	
   

  	
  24

  
	
  SECTION 2.13.

  	
  Increased Costs

  	
   

  	
  24

  
	
  SECTION 2.14.

  	
  Break Funding Payments

  	
   

  	
  26

  
	
  SECTION 2.15.

  	
  Taxes

  	
   

  	
  26

  
	
  SECTION 2.16.

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

  	
   

  	
  30

  
	
  SECTION 2.17.

  	
  Mitigation Obligations; Replacement of Lenders

  	
   

  	
  31

  
	
  SECTION 2.18.

  	
  Increase in Commitments

  	
   

  	
  32

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  III

  	
  REPRESENTATIONS AND WARRANTIES

  	
   

  	
  33

  
	
   

  	
   

  	
   

  
	
  SECTION 3.01.

  	
  Organization; Powers

  	
   

  	
  33

  
	
  SECTION 3.02.

  	
  Authorization; Enforceability

  	
   

  	
  33

  
	
  SECTION 3.03.

  	
  Governmental Approvals; No Conflicts

  	
   

  	
  34

  
	
  SECTION 3.04.

  	
  Financial Condition; No Material Adverse Effect

  	
   

  	
  34

  
	
  SECTION 3.05.

  	
  Properties

  	
   

  	
  34

  
	
  SECTION 3.06.

  	
  Litigation and Environmental Matters

  	
   

  	
  34

  
	
  SECTION 3.07.

  	
  Compliance with Laws and Agreements

  	
   

  	
  35

  
	
  SECTION 3.08.

  	
  Investment and Holding Company Status

  	
   

  	
  35

  
	
  SECTION 3.09.

  	
  Taxes

  	
   

  	
  35

  
	
  SECTION 3.10.

  	
  ERISA

  	
   

  	
  36

  

 

i

 

TABLE OF CONTENTS

(continued)

 

	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 3.11.

  	
  Disclosure

  	
   

  	
  36

  
	
  SECTION 3.12.

  	
  No Default

  	
   

  	
  36

  
	
  SECTION 3.13.

  	
  Subsidiaries

  	
   

  	
  36

  
	
  SECTION 3.14.

  	
  Federal Regulations

  	
   

  	
  37

  
	
  SECTION 3.15.

  	
  No Burdensome Restrictions

  	
   

  	
  37

  
	
  SECTION 3.16.

  	
  Insurance

  	
   

  	
  37

  
	
  SECTION 3.17.

  	
  Taxpayer Identification Number

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  IV

  	
  CONDITIONS

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 4.01.

  	
  Conditions to Closing Date

  	
   

  	
  37

  
	
  SECTION 4.02.

  	
  Each Credit Event

  	
   

  	
  39

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  V

  	
  AFFIRMATIVE COVENANTS

  	
   

  	
  40

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 5.01.

  	
  Financial Statements
  and Other Information

  	
   

  	
  40

  
	
  SECTION 5.02.

  	
  Notices of Material
  Events

  	
   

  	
  42

  
	
  SECTION 5.03.

  	
  Existence; Conduct of
  Business

  	
   

  	
  43

  
	
  SECTION 5.04.

  	
  Payment of Obligations

  	
   

  	
  43

  
	
  SECTION 5.05.

  	
  Maintenance of
  Properties; Insurance

  	
   

  	
  43

  
	
  SECTION 5.06.

  	
  Books and Records;
  Inspection Rights

  	
   

  	
  43

  
	
  SECTION 5.07.

  	
  Compliance with Laws

  	
   

  	
  44

  
	
  SECTION 5.08.

  	
  Use of Proceeds

  	
   

  	
  44

  
	
  SECTION 5.09.

  	
  Environmental Laws

  	
   

  	
  44

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  VI

  	
  NEGATIVE COVENANTS

  	
   

  	
  45

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 6.01.

  	
  Financial Condition
  Covenants

  	
   

  	
  45

  
	
  SECTION 6.02.

  	
  Indebtedness

  	
   

  	
  45

  
	
  SECTION 6.03.

  	
  Liens

  	
   

  	
  46

  
	
  SECTION 6.04.

  	
  Fundamental Changes

  	
   

  	
  46

  
	
  SECTION 6.05.

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

  	
   

  	
  47

  
	
  SECTION 6.06.

  	
  Restricted Payments

  	
   

  	
  48

  
	
  SECTION 6.07.

  	
  Transactions with
  Affiliates

  	
   

  	
  48

  
	
  SECTION 6.08.

  	
  Restrictive Agreements

  	
   

  	
  48

  
	
  SECTION 6.09.

  	
  Capital Expenditures

  	
   

  	
  49

  
	
  SECTION 6.10.

  	
  Sales and Leasebacks

  	
   

  	
  49

  
	
  SECTION 6.11.

  	
  Changes in Fiscal
  Periods

  	
   

  	
  49

  

 

ii

 

TABLE OF CONTENTS

(continued)

 

	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 6.12.

  	
  Optional Payments and Modifications of Certain Debt
  Instruments

  	
   

  	
  49

  
	
  SECTION 6.13.

  	
  Use of Proceeds

  	
   

  	
  49

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  VII

  	
  EVENTS OF DEFAULT

  	
   

  	
  49

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  VIII

  	
  THE ADMINISTRATIVE AGENT

  	
   

  	
  52

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 8.01.

  	
  Appointment and Authority

  	
   

  	
  52

  
	
  SECTION 8.02.

  	
  Rights as a Lender

  	
   

  	
  53

  
	
  SECTION 8.03.

  	
  Exculpatory Provisions

  	
   

  	
  53

  
	
  SECTION 8.04.

  	
  Reliance by Administrative Agent

  	
   

  	
  54

  
	
  SECTION 8.05.

  	
  Delegation of Duties

  	
   

  	
  54

  
	
  SECTION 8.06.

  	
  Resignation of Administrative Agent

  	
   

  	
  54

  
	
  SECTION 8.07.

  	
  Non-Reliance on Administrative Agent and Other
  Lenders

  	
   

  	
  55

  
	
  SECTION 8.08.

  	
  No Other Duties, Etc

  	
   

  	
  55

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  IX

  	
  MISCELLANEOUS

  	
   

  	
  55

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 9.01.

  	
  Notices; Effectiveness; Electronic Communication

  	
   

  	
  55

  
	
  SECTION 9.02.

  	
  Waivers; Amendments; Enforcement

  	
   

  	
  57

  
	
  SECTION 9.03.

  	
  Expenses; Indemnity; Damage Waiver

  	
   

  	
  59

  
	
  SECTION 9.04.

  	
  Successors and Assigns

  	
   

  	
  60

  
	
  SECTION 9.05.

  	
  Survival

  	
   

  	
  64

  
	
  SECTION 9.06.

  	
  Counterparts; Integration; Effectiveness

  	
   

  	
  64

  
	
  SECTION 9.07.

  	
  Severability

  	
   

  	
  64

  
	
  SECTION 9.08.

  	
  Right of Setoff

  	
   

  	
  64

  
	
  SECTION 9.09.

  	
  Governing Law; Jurisdiction; Consent to Service of
  Process

  	
   

  	
  65

  
	
  SECTION 9.10.

  	
  WAIVER OF JURY TRIAL

  	
   

  	
  65

  
	
  SECTION 9.11.

  	
  Headings

  	
   

  	
  66

  
	
  SECTION 9.12.

  	
  Confidentiality

  	
   

  	
  66

  
	
  SECTION 9.13.

  	
  Interest Rate Limitation

  	
   

  	
  67

  
	
  SECTION 9.14.

  	
  No Advisory or Fiduciary Responsibility

  	
   

  	
  67

  
	
  SECTION 9.15.

  	
  USA Patriot Act

  	
   

  	
  67

  
						

 

iii

 

	
  SCHEDULES:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Schedule 2.01

  	
  —

  	
   

  	
  Commitments

  
	
  Schedule 3.01

  	
  —

  	
   

  	
  Good Standing

  
	
  Schedule 3.04

  	
  —

  	
   

  	
  Financial Condition

  
	
  Schedule 3.06

  	
  —

  	
   

  	
  Disclosed Matters

  
	
  Schedule 3.13

  	
  —

  	
   

  	
  Subsidiaries

  
	
  Schedule 6.02

  	
  —

  	
   

  	
  Existing Indebtedness

  
	
  Schedule 6.03

  	
  —

  	
   

  	
  Existing Liens

  
	
  Schedule 6.08

  	
  —

  	
   

  	
  Existing Restrictions

  
	
  Schedule 6.10

  	
  —

  	
   

  	
  Sale/Leaseback Properties

  
	
  Schedule 9.01

  	
  —

  	
   

  	
  Administrative Agent’s Office; Certain Addresses for Notices

  
	
   

  	
   

  	
   

  	
   

  
	
  EXHIBITS:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit A

  	
  —

  	
   

  	
  Form of Assignment and Acceptance

  
	
  Exhibit B

  	
  —

  	
   

  	
  Form of Note

  
	
  Exhibit C-1

  	
  —

  	
   

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

  
	
  Exhibit C-2

  	
  —

  	
   

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

  
	
  Exhibit D

  	
  —

  	
   

  	
  Form of Revolving Borrowing Request

  
	
  Exhibit E

  	
  —

  	
   

  	
  Form of Compliance Certificate

  

 

iv

 

CREDIT
AGREEMENT

 

This CREDIT AGREEMENT is entered into
as of October 6, 2008, among WADDELL & REED
FINANCIAL, INC. (the “Borrower”), the several financial
institutions from time to time party hereto (collectively, the “Lenders”
and each individually, a “Lender”), and BANK OF
AMERICA, N.A. (“Bank of America”), as administrative agent
for the Lenders (in such capacity, together with any successors thereto in such
capacity, the “Administrative Agent”).

 

ARTICLE I

 

Definitions

 

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

 

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

 

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

 

	
  Adjusted LIBO Rate =

  	
   

  	
   

  	
  LIBO Rate

  	
   

  	
   

  
	
   

  	
   

  	
  1.00 – Eurodollar Reserve Percentage

  	
   

  

 

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

 

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

 

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

 

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

 

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

 

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

 

 

“Alternate Base Rate” means, for any day, a rate per annum equal
to the greater of (a) the Prime Rate in effect on such day, or (b) the
Federal Funds Effective Rate in effect on such day plus 1/2 of 1%.  Any change in the Alternate Base Rate due to
a change in the Prime Rate or the Federal Funds Effective Rate shall be
effective from and including the effective date of such change in the Prime
Rate or the Federal Funds Effective Rate, respectively.

 

“Applicable Percentage” means, with respect to any Lender, the
percentage (carried to the ninth decimal place) of the total Commitments
represented by such Lender’s Commitment. 
If the Commitments have terminated or expired, the Applicable Percentages
shall be determined based upon the Commitments most recently in effect, giving
effect to any assignments.

 

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

 

	
  Pricing

  Level

  	
   

  	
  Debt Rating

  	
   

  	
  Facility Fee

  	
   

  	
  Eurodollar Loans

  	
   

  	
  ABR Loans

  	
   

  
	
  1

  	
   

  	
   

  	
  >
  A- / A3

  	
   

  	
  0.15

  	
  %

  	
  1.10

  	
  %

  	
  0.10

  	
  %

  
	
  2

  	
   

  	
   

  	
  BBB+ / Baa1

  	
   

  	
  0.20

  	
  %

  	
  1.30

  	
  %

  	
  0.30

  	
  %

  
	
  3

  	
   

  	
   

  	
  BBB / Baa2

  	
   

  	
  0.25

  	
  %

  	
  1.50

  	
  %

  	
  0.50

  	
  %

  
	
  4

  	
   

  	
   

  	
  BBB- / Baa3

  	
   

  	
  0.30

  	
  %

  	
  1.95

  	
  %

  	
  0.95

  	
  %

  
	
  5

  	
   

  	
   

  	
  < BBB- /
  Baa3

  	
   

  	
  0.40

  	
  %

  	
  2.35

  	
  %

  	
  1.35

  	
  %

  

 

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

 

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

 

2

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

“Capital Lease Obligations” of any Person means the obligations
of such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.

 

3

 

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

 

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

 

“Change in Law” means (a) the adoption of any law, rule or
regulation after the date of this Agreement, (b) any change in any law, rule or
regulation or in the interpretation or application thereof by any Governmental
Authority after the date of this Agreement, or (c) compliance by any
Lender (or, for purposes of Section 2.13(b), by any lending office
of such Lender or by such Lender’s holding company, if any) with any request,
guideline or directive (whether or not having the force of law) of any
Governmental Authority made or issued after the date of this Agreement.

 

“Closing Date” means the date on which the conditions precedent
set forth in Section 4.01 shall have been satisfied, which date is October 6, 2008.

 

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

 

“Commitment” means, with respect to each Lender, the commitment
of such Lender to make Loans hereunder, expressed as an amount representing the maximum
aggregate outstanding principal amount of such Lender’s Loans hereunder, as
such commitment may be (a) reduced from time to time pursuant to Section 2.07,
(b) reduced or increased from time to time pursuant to assignments by or
to such Lender pursuant to Section 9.04, and (c) increased
from time to time pursuant to Section 2.18.  The initial amount of each Lender’s
Commitment is set forth on Schedule 2.01, or in the Assignment and
Acceptance pursuant to which such Lender shall have assumed its Commitment, as
applicable, and the initial aggregate amount of the Commitments of the Lenders
(as set forth on Schedule 2.01) is $175,000,000.

 

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

 

“Confidential Information Memorandum” means the Confidential
Information Memorandum dated September 2008 and furnished to the Lenders.

 

4

 

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

 

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

 

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

 

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

 

“Consolidated Net Income” means, for any period, the
consolidated net income (or loss) of the Borrower and its Subsidiaries,
determined on a consolidated basis in accordance with GAAP; provided
that there shall be excluded (a) the income (or deficit) of any Person 

 

5

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

6

 

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

 

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

 

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

 

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

 

“ERISA Affiliate” means any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code or, solely for purposes
of Section 302 of ERISA and Section 412 of the Code, is treated as a
single employer under Section 414 of the Code.

 

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

 

7

 

respect to plan years ending prior to the
effective date as to any such Plan of the Pension Protection Act of 2006,
Sections 401(a)(29) and 412 of the Code and Part 3, Subtitle I, of Title I
of ERISA each as in effect prior to the Pension Protection Act of 2006 and,
thereafter, Sections 412 and 430 through 436 of the Code and Part 3,
Subtitle I, of Title I of ERISA each as in effect from time to time.

 

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

 

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

 

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

 

“Excluded Taxes” means, with respect to the Administrative
Agent, any Lender, or any other recipient of any payment to be made by or on
account of any obligation of the Borrower hereunder, (a) income or
franchise taxes imposed on (or measured by) its net income by the United States
of America, or by the jurisdiction under the laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Lender, in which its applicable lending office is located, (b) any backup
withholding or branch profits taxes imposed by the United States of America or
any similar tax imposed by any other jurisdiction in which the Borrower is
located, and (c) in the case of a Foreign Lender (other than an assignee
pursuant to a request by the Borrower under Section 2.17(b)), any
withholding tax that is imposed on amounts payable to such Foreign Lender at
the time such Foreign Lender becomes a party to this Agreement or is
attributable to such Foreign Lender’s failure or inability to comply with Section 2.15(e),
except to the extent that such Foreign Lender’s assignor (if any) was entitled,
at the time of assignment, to receive additional amounts from the Borrower with
respect to such withholding tax pursuant to Section 2.15(a).

 

“Existing Credit Agreement” means the Credit Agreement, dated as
of October 7, 2005, among the Borrower, certain financial institutions,
JPMorgan Chase Bank, N.A., as administrative agent and Bank of America as
syndication agent.

 

“Federal Funds Effective Rate” means, for any day, the rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published by the Federal Reserve Bank of New York
on the Business Day next succeeding such day; provided that (a) if
such day is not a Business Day, the Federal Funds Rate for such day shall be
such rate on such transactions on the next preceding Business Day as so
published on the next succeeding 

 

8

 

Business Day, and (b) if no such rate is
so published on such next succeeding Business Day, the Federal Funds Effective
Rate for such day shall be the average rate (rounded upward, if necessary, to a
whole multiple of 1/100 of 1%) charged to Bank of America on such day on such
transactions as determined by the Administrative Agent.

 

“Fee Letter” means the letter agreement, dated as of September 9,
2008, among the Borrower, the Administrative Agent and the Arranger.

 

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

 

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

 

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

 

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

 

“Governmental Authority” means the government of the United
States of America, any other nation or any political subdivision thereof,
whether state or local, and any agency, authority, instrumentality, regulatory
body (including self-regulatory body), court, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government, including,
in any event, the SEC and any applicable state securities commission or similar
body.

 

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

 

9

 

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

 

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

 

“Increase Effective Date” has the meaning specified in Section 2.18.

 

“Increasing Lender” has the meaning specified in Section 2.18.

 

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

 

“Indemnified Taxes” means Taxes other than Excluded Taxes.

 

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

 

10

 

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

 

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

 

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

 

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

 

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

 

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

 

“Management Contract” means an agreement, written or oral,
pursuant to which the Borrower or any Subsidiary of the Borrower provides (a) investment
advisory, management or administrative services to a W&R Fund, or (b) investment
advisory or management services to 

 

11

 

any Person, including, without limitation,
unregistered investment companies and personal or corporate investment
accounts.

 

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

 

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

 

“Moody’s” means Moody’s Investors Service, Inc.

 

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

 

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

 

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

 

“Other Taxes” means any and all present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made under the Loan Documents or from the
execution, delivery or enforcement of, or otherwise with respect to, the Loan
Documents.

 

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

 

“Participating Lender” has the meaning specified in Section 2.18.

 

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

 

“Permitted Acquisition” means an acquisition of a Person, or the
assets of a Person or a line of business of a Person, in the same or a related
line of business as the Borrower, provided that after giving effect to
such acquisition (a) no Default or Event of Default shall have occurred
and be continuing, (b) the Borrower shall be in compliance, on a pro
forma basis, as of 

 

12

 

the end of the most recent fiscal quarter of
the Borrower with the provisions of Section 6.01 after giving
effect to such acquisition and the incurrence of any Indebtedness in connection
therewith, and (c) in the case of an acquisition involving aggregate
consideration valued at $20,000,000 or more, at least three Business Days prior
to the date of such acquisition, the Borrower shall have furnished to the
Administrative Agent and the Lenders a compliance certificate to the effect of clauses
(a) and (b) showing in reasonable detail the calculations
supporting the determination of compliance, on such a pro  forma
basis, with such provisions.

 

“Permitted Encumbrances” means:

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

“Permitted Investments” means:

 

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

 

13

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

14

 

in such rate announced by Bank of America
shall take effect at the opening of business on the day specified in the public
announcement of such change.

 

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

 

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

 

“Required Lenders” means Lenders having Revolving Credit
Exposures and unused Commitments representing at least 51% of the sum of the
total Revolving Credit Exposures and unused Commitments at such time.

 

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

 

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

 

“Revenue Base” means the sum of (a) the product of (i) with
respect to each W&R Fund, the Net Asset Value of the W&R Fund on the
date of calculation and with respect to assets managed for other entities, the
market value or Net Asset Value of such assets on the date of calculation, and (ii) the
rate provided for in the applicable Management Contract for determining the
annual fee required for such advisory, management or administrative services on
such date, and (b) Distribution Fees for such W&R Fund.

 

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

 

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

 

“Revolving Credit Termination Date” means October 5, 2009
or such earlier date as the Commitments shall terminate pursuant to the terms
hereof (or, if such day is not a Business Day, the next preceding Business
Day).

 

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

 

15

 

“S&P” means Standard & Poor’s.

 

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

 

“Subsidiary” means any subsidiary of the Borrower.

 

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

 

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

 

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

 

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

 

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

 

SECTION 1.02.  Terms Generally.  The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined.  Whenever the context may require, any pronoun
shall include the corresponding masculine, feminine and neuter forms.  The words “include”, “includes” and
“including” shall be deemed to be followed by the phrase “without
limitation”.  The word “will” shall be
construed to have the same meaning and effect as the word “shall”.  Unless the context requires otherwise (a) any
definition of or reference to any agreement, instrument or other document
herein shall be construed as referring to such agreement, instrument or other
document as from time to time amended, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or modifications
set forth herein), (b) any reference herein to any Person shall be
construed to include such Person’s successors and assigns, (c) the words
“herein”, “hereof” and “hereunder”, 

 

16

 

and words of similar
import, shall be construed to refer to this Agreement in its entirety and not
to any particular provision hereof, (d) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement, and (e) the
words “asset” and “property” shall be construed to have the same meaning and
effect and to refer to any and all tangible and intangible assets and
properties, including cash, securities, accounts and contract rights.

 

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

 

ARTICLE II

 

The Credits

 

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

 

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

 

(b)           Subject to Section 2.12,
each Borrowing shall be comprised entirely of ABR Loans or Eurodollar Loans as
the Borrower may request in accordance herewith.  Each Lender at its option may make any
Eurodollar Loan by causing any domestic or foreign branch or Affiliate of such
Lender to make such Loan; provided that any exercise of such option
shall not affect the obligation of the Borrower to repay such Loan in
accordance with the terms of this Agreement.

 

17

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

(vi)                              the
location and number of the Borrower’s account to which Loans are to be
disbursed, which shall comply with the requirements of Section 2.05.

 

18

 

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

 

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

 

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

 

SECTION 2.04.  [Intentionally
Omitted].

 

SECTION 2.05.  Funding of Borrowings.  (a)  Each Lender shall make each Loan to
be made by it hereunder on the proposed date thereof in immediately available
funds by 12:00 noon, New York City time, at the Administrative Agent’s
Office.  Upon satisfaction of the
applicable conditions set forth in Section 4.02, the Administrative
Agent will make such Loans available to the Borrower in like funds as received
by the Administrative Agent either by (i) crediting the account of the
Borrower on the books of Bank of America with the amount of such funds or (ii) wire
transfer of such funds, in each case in accordance with instructions provided
to (and reasonably acceptable to) the Administrative Agent by the Borrower in
the applicable Revolving Borrowing Request.

 

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

 

(c)                                  Unless
the Administrative Agent shall have received notice from a Lender prior to the
proposed date of any Borrowing that such Lender will not make available to the
Administrative Agent such Lender’s share of such Borrowing, the Administrative
Agent may assume that such Lender has made such share available on such date in
accordance with paragraph (a) of this Section and may, in reliance
upon such assumption, make available to the Borrower a corresponding
amount.  In such event, if a Lender has
not in fact made its share of the applicable Borrowing available to the
Administrative Agent, then the applicable Lender and

 

19

 

the Borrower
severally agree to pay to the Administrative Agent forthwith on demand such
corresponding amount with interest thereon, for each day from and including the
date such amount is made available to the Borrower to but excluding the date of
payment to the Administrative Agent, at (i) in the case of such Lender,
the greater of the Federal Funds Effective Rate and a rate determined by the
Administrative Agent in accordance with banking industry rules on
interbank compensation, plus any administrative, processing or similar fees
customarily charged by the Administrative Agent in connection with the
foregoing, or (ii) in the case of the Borrower, the interest rate
applicable to ABR Loans.  If the Borrower
and such Lender shall pay such interest to the Administrative Agent for the
same or an overlapping period, the Administrative Agent shall promptly remit to
the Borrower the amount of such interest paid by the Borrower for such
period.  If such Lender pays such amount
to the Administrative Agent, then such amount shall constitute such Lender’s
Loan included in such Borrowing.  A
notice of the Administrative Agent to any Lender or the Borrower with respect
to any amount owing under this subsection (c) shall be conclusive,
absent manifest error.

 

(d)                                 If
any Lender makes available to the Administrative Agent funds for any Loan to be
made by such Lender as provided in the foregoing provisions of this Section 2.05,
and such funds are not made available to the Borrower by the Administrative
Agent because the conditions to the applicable Borrowing set forth in Article IV
are not satisfied or waived in accordance with the terms hereof, the
Administrative Agent shall return such funds (in like funds as received from
such Lender) to such Lender, without interest.

 

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

 

SECTION 2.06.  [Intentionally
Omitted].

 

SECTION 2.07.  Termination and Reduction of Commitments.  (a)  Unless previously terminated, the
Commitments shall terminate on the Revolving Credit Termination Date.

 

(b)                                 The
Borrower may, upon notice to the Administrative Agent pursuant to Section 2.07(c),
at any time terminate, or from time to time reduce, the Commitments; provided
that (i) each reduction of the Commitments shall be in an amount that is
an integral multiple of $1,000,000 and not less than $10,000,000, and (ii) the
Borrower shall not terminate or reduce the Commitments if, after giving effect
to any concurrent prepayment of the Loans in accordance with Section 2.09,
the aggregate Revolving Credit Exposures of all Lenders would exceed the total
Commitments.

 

(c)                                  The
Borrower shall notify the Administrative Agent of any election to terminate or
reduce the Commitments under paragraph (b) of this Section at least
three (3) Business Days prior to the effective date of such termination or
reduction, specifying such election and the effective date thereof.  Promptly following receipt of any notice, the
Administrative Agent shall advise the Lenders of the contents thereof.  Each notice delivered by

 

20

 

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

 

SECTION 2.08.  Repayment of Loans; Evidence of Debt.  (a)  The Borrower hereby unconditionally
promises to pay to the Administrative Agent for the account of each Lender the
then unpaid principal amount of each Loan on the Revolving Credit Termination
Date (or such earlier date on which the Loans become due and payable pursuant
to Article VII).

 

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

 

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

 

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

 

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

 

SECTION 2.09.  Prepayment of Loans.  (a)  The Borrower shall have the right
at any time and from time to time to prepay any Loans in whole or in part,
subject to prior notice in accordance with paragraph (b) of this Section.

 

21

 

(b)                                 The
Borrower shall notify the Administrative Agent by telephone (confirmed by
telecopy) of any prepayment hereunder (i) in the case of prepayment of a
Eurodollar Loan, not later than 11:00 a.m., New York City time, three (3) Business
Days before the date of prepayment, or (ii) in the case of prepayment of
an ABR Loan, not later than 11:00 a.m., New York City time, one (1) Business
Day before the date of prepayment.  Each
such notice shall be irrevocable and shall specify the prepayment date and the
principal amount of the Loans to be prepaid and the Type(s) of Loans to be
prepaid and, if Eurodollar Loans are to be prepaid, the Interest Period(s) of
such Loans; provided that, if a notice of prepayment is given in
connection with a conditional notice of termination of the Commitments as
contemplated by Section 2.07, then such notice of prepayment may be
revoked if such notice of termination is revoked in accordance with Section 2.07.  Promptly following receipt of any such
notice, the Administrative Agent shall advise the Lenders of the contents
thereof and of the amount of such Lender’s Applicable Percentage of such
prepayment.  Each partial prepayment of
any Loans shall be in an amount that would be permitted in the case of an
advance of a Borrowing of the same Type as provided in Section 2.02.  Any prepayment of a Eurodollar Loan shall be
accompanied by all accrued interest on the amount prepaid as required pursuant
to Section 2.11(e), together with any additional amounts required
pursuant to Section 2.14. 
Each such prepayment shall be applied to the Loans of the Lenders in
accordance with their respective Applicable Percentages.

 

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

 

SECTION 2.10.  Fees. 
(a)  The Borrower agrees to pay to the Administrative Agent for the
account of each Lender in accordance with its Applicable Percentage, a facility
fee which shall accrue at the Applicable Rate on the daily amount of the
aggregate Commitments of all Lenders (whether used or unused), during the
Availability Period, including at any time during which one or more of the
conditions in Section 4.02 is not met; provided, however,
that, if the Lenders continue to have any outstanding Loans after the
Availability Period, then such facility fee shall continue to accrue on the
daily amount of the outstanding Loans from and including the date on which the
aggregate Commitments of all Lenders are terminated to, but excluding, the date
on which the Lenders cease to have any outstanding Loans.  Accrued facility fees shall be payable in
arrears on the last Business Day of March, June, September and December of
each year and on the date on which the Commitments terminate, commencing on the
first such date to occur after the Closing Date; provided that any facility
fees accruing after the date on which the aggregate Commitments terminate shall
be payable on demand.  The facility fee
shall be calculated quarterly in arrears, and if there is any change in the
Applicable Rate during any quarter, the actual daily amount shall be computed
and multiplied by the Applicable Rate separately for each period during such
quarter that such Applicable Rate was in effect.  All facility fees shall be computed on the
basis of a year of 360 days and shall be payable for the actual number of days
elapsed (including the first day but excluding the last day).

 

22

 

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

 

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

 

SECTION 2.11.  Interest.  (a)  Subject to the provisions of subsection
(d) below, the ABR Loans shall bear interest at a rate per annum equal
to the Alternate Base Rate plus the Applicable Rate.

 

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

 

(c)                                  [Intentionally Omitted].

 

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

 

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

 

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

 

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

 

23

 

(f)                                    All
interest hereunder shall be computed on the basis of a year of 360 days, except
that interest computed by reference to the Alternate Base Rate at times when
the Alternate Base Rate is based on the Prime Rate shall be computed on the
basis of a year of 365 days (or 366 days in a leap year), and in each case
shall be payable for the actual number of days elapsed (including the first day
but excluding the last day); provided that any Loan that is repaid on
the same day on which it is made shall, subject to Section 2.16(a),
bear interest for one day.  The
applicable Alternate Base Rate, Adjusted LIBO Rate or LIBO Rate shall be
determined by the Administrative Agent, and such determination shall be
conclusive absent manifest error.

 

SECTION 2.12.  Alternate Rate of Interest.  (a)  If, in connection with any request
for a Eurodollar Loan or a conversion to or continuation thereof, the Required
Lenders determine that for any reason (which determination shall be conclusive
absent manifest error) that (a) dollar deposits are not being offered to
banks in the London interbank eurodollar market for the applicable amount and
Interest Period of such Eurodollar Loan, (b) adequate and reasonable means
do not exist for ascertaining the Adjusted LIBO Rate or the LIBO Rate, as
applicable, for any requested Interest Period with respect to a proposed
Eurodollar Loan; or (c) the Adjusted LIBO Rate or the LIBO Rate, as
applicable, for any requested Interest Period with respect to a proposed
Eurodollar Loan will not adequately and fairly reflect the cost to such Lenders
of funding such Loan, then the Administrative Agent shall give notice thereof
to the Borrower and each Lender by telephone or telecopy as promptly as
practicable thereafter.  Until the
Administrative Agent (upon the instruction of the Required Lenders) revokes
such notice, (i) any Revolving Borrowing Request that requests the
conversion of any Loan to, or continuation of any Loan as, a Eurodollar Loan
shall be ineffective, and (ii) if any Revolving Borrowing Request requests
a Borrowing of Eurodollar Loans, such Borrowing shall be made as an ABR Loan.

 

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

 

SECTION 2.13.  Increased Costs.  (a)  If any Change in Law shall:

 

(i)                                     impose,
modify or deem applicable any reserve, special deposit, compulsory loan,
insurance charge or similar requirement against assets of, deposits with

 

24

 

or for the account
of, or credit extended by, any Lender (except any such reserve requirement
reflected in the Adjusted LIBO Rate); or

 

(ii)                                  subject
any Lender to any tax of any kind whatsoever with respect to this Agreement or
any Eurodollar Loan made by it, or change the basis of taxation of payments to
such Lender in respect thereof (except for Indemnified Taxes or Other Taxes
covered by Section 2.15 and the imposition of, or any change in the
rate of, any Excluded Tax payable by such Lender); or

 

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

 

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

 

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

 

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

 

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

 

25

 

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

 

SECTION 2.14.  Break Funding Payments.  In the event of (a) the payment of any
principal of any Eurodollar Loan other than on the last day of an Interest
Period applicable thereto (whether voluntary, mandatory, by reason of
acceleration, or otherwise), (b) the conversion of any Eurodollar Loan
other than on the last day of the Interest Period applicable thereto (whether
voluntary, mandatory, automatic, by reason of acceleration, or otherwise), (c) the
failure to borrow, convert, continue or prepay any Loan on the date specified
in any notice delivered pursuant hereto (regardless of whether such notice is
permitted to be revocable under Section 2.09(b) and is revoked
in accordance herewith), or (d) the assignment of any Eurodollar Loan
other than on the last day of the Interest Period applicable thereto as a
result of a request by the Borrower pursuant to Section 2.17, then,
in any such event, the Borrower shall compensate each Lender for the loss, cost
and expense attributable to such event. 
The Borrower shall also pay any customary administrative fees charged by
such Lender in connection with the foregoing. 
In the case of a Eurodollar Loan, the loss to any Lender attributable to
any such event shall be deemed to include an amount determined by such Lender
to be equal to the excess, if any, of (i) the amount of interest that such
Lender would pay for a deposit equal to the principal amount of such Loan for
the period from the date of such payment, conversion, failure or assignment to
the last day of the then current Interest Period for such Loan (or, in the case
of a failure to borrow, convert or continue, the duration of the Interest
Period that would have resulted from such borrowing, conversion or
continuation) if the interest rate payable on such deposit were equal to the
Adjusted LIBO Rate (in the case of a Eurodollar Loan) for such Interest Period,
over (ii) the amount of interest that such Lender would earn on such
principal amount for such period if such Lender were to invest such principal
amount for such period at the interest rate that would be bid by such Lender
(or an affiliate of such Lender) for dollar deposits from other banks in the
eurodollar market at the commencement of such period.  A certificate of any Lender setting forth any
amount or amounts that such Lender is entitled to receive pursuant to this Section shall
be delivered to the Borrower and shall be conclusive absent manifest
error.  The Borrower shall pay such
Lender the amount shown as due on any such certificate within ten (10) days
after receipt thereof.  All of the
Borrower’s obligations under this Section 2.14 shall survive
termination of the Commitments, repayment of all Loans and other obligations
hereunder, and resignation of the Administrative Agent.

 

SECTION 2.15.  Taxes. 
(a)  Any and all payments by or an account of any obligation of the
Borrower hereunder shall be made free and clear of and without deduction for
any Indemnified Taxes or Other Taxes; provided that if the Borrower
shall be required to deduct any Indemnified Taxes or Other Taxes from such
payments, then (i) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this Section) the Administrative Agent or Lender
(as the case may be) receives an amount equal to the sum it would have received
had no such deductions been made, (ii) the Borrower shall make such
deductions, and (iii) the Borrower shall pay the full amount deducted to
the relevant Governmental Authority in accordance with applicable law.

 

26

 

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

 

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

 

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

 

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

 

(e)                                (i) 
Each Lender shall deliver to the Borrower and to the Administrative Agent, at
the time or times prescribed by applicable laws or when reasonably requested by
the Borrower or the Administrative Agent, such properly completed and executed
documentation prescribed by applicable laws or by the taxing authorities of any
jurisdiction and such other reasonably requested information as will permit the
Borrower or the Administrative Agent, as the case may be, to determine (A) whether
or not payments made hereunder or under any other Loan 

 

27

 

Document are
subject to Taxes, (B) if applicable, the required rate of withholding or
deduction, and (C) such Lender’s entitlement to any available exemption
from, or reduction of, applicable Taxes in respect of all payments to be made
to such Lender by the Borrower pursuant to this Agreement or otherwise to
establish such Lender’s status for withholding tax purposes in the applicable
jurisdiction.

 

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

 

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

 

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

 

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

 

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

 

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

 

(IV)                            in
the case of a Foreign Lender claiming the benefits of the exemption for
portfolio interest under section 881(c) of the Code, (x) a certificate, in
form and 

 

28

 

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

 

(V)                                properly
completed and executed originals of any other form prescribed by applicable
laws as a basis for claiming exemption from or a reduction in United States
Federal withholding tax together with such supplementary documentation as may
be prescribed by applicable laws to permit the Borrower or the Administrative
Agent to determine the withholding or deduction required to be made.

 

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

 

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

 

(g)                                 All
of the Borrower’s obligations under this Section 2.15 shall survive
termination of the Commitments, repayment of all Loans and other obligations
hereunder, and resignation of the Administrative Agent.

 

(h)                                 If
the Administrative Agent or any Lender determines, in its sole discretion, that
it has received a refund of any Indemnified Taxes or Other Taxes as to which it
has been indemnified by the Borrower or with respect to which the Borrower has
paid additional amounts pursuant to this Section, it shall pay to the Borrower
an amount equal to such refund (but only to the extent of indemnity payments
made, or additional amounts paid, by the Borrower under this Section with
respect to the Taxes or Other Taxes giving rise to such refund), net of all
out-of-pocket expenses incurred by the Administrative Agent or such Lender, as
the case may be, and without interest (other than any interest paid by the
relevant Governmental Authority with respect to such refund), provided that the
Borrower, upon the request of the Administrative 

 

29

 

Agent or such Lender,
agrees to repay the amount paid over to the Borrower (plus any penalties,
interest or other charges imposed by the relevant Governmental Authority) to
the Administrative Agent or such Lender in the event the Administrative Agent
or such Lender is required to repay such refund to such Governmental
Authority.  This subsection shall not be
construed to require the Administrative Agent or any Lender to make available
its tax returns (or any other information relating to its taxes that it deems
confidential) to the Borrower or any other Person.

 

SECTION 2.16.  Payments Generally; Pro Rata Treatment;
Sharing of Set-offs.  (a)  All
payments to be made by the Borrower shall be made without condition or
deduction for any counterclaim, defense, recoupment or setoff.  The Borrower shall make each payment required
to be made by it hereunder (whether of principal, interest, fees, or under Sections
2.13, 2.14 or 2.15, or otherwise) to the Administrative
Agent, for the account of the respective Lenders to which such payment is owed,
at the Administrative Agent’s Office prior to 12:00 noon, New York City time,
on the date when due, in immediately available funds.  Any amounts received after such time on any
date shall be deemed to have been received on the next succeeding Business Day
and any applicable interest or fee shall continue to accrue.  The Administrative Agent will promptly
distribute to each Lender its Applicable Percentage (or other applicable share
as provided herein) of such payment in like funds as received by wire transfer
to such Lender (or as otherwise directed by such Lender).  If any payment hereunder shall be due on a
day that is not a Business Day, the date for payment shall be extended to the
next succeeding Business Day, and, in the case of any payment accruing
interest, interest thereon shall be payable for the period of such
extension.  All payments hereunder shall
be made in dollars.

 

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

 

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

 

30

 

applicable law,
that any Lender acquiring a participation pursuant to the foregoing
arrangements may exercise against the Borrower rights of set-off and
counterclaim with respect to such participation as fully as if such Lender were
a direct creditor of the Borrower in the amount of such participation.

 

(d)                                 Unless
the Administrative Agent shall have received notice from the Borrower prior to
the date on which any payment is due to the Administrative Agent for the
account of the Lenders hereunder that the Borrower will not make such payment,
the Administrative Agent may assume that the Borrower has made such payment on
such date in accordance herewith and may, in reliance upon such assumption,
distribute to the Lenders the amount due. 
In such event, if the Borrower has not in fact made such payment, then
each of the Lenders severally agrees to repay to the Administrative Agent
forthwith on demand the amount so distributed to such Lender with interest
thereon, for each day from and including the date such amount is distributed to
it to but excluding the date of payment to the Administrative Agent, at the
greater of the Federal Funds Effective Rate and a rate determined by the
Administrative Agent in accordance with banking industry rules on interbank
compensation.  A notice of the
Administrative Agent to any Lender with respect to any amount owing under this subsection
(d) shall be conclusive, absent manifest error.

 

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

 

(f)                                    If
any Lender shall fail to make any payment required to be made by it pursuant to
Sections 2.05(c), 2.16(d) or 9.03(c), then the
Administrative Agent may, in its discretion (notwithstanding any contrary
provision hereof), apply any amounts thereafter received by the Administrative
Agent for the account of such Lender to satisfy such Lender’s obligations under
such Sections until all such unsatisfied obligations are fully paid.

 

SECTION 2.17.  Mitigation Obligations; Replacement of
Lenders.  (a)  If any Lender
requests compensation under Section 2.13, or if the Borrower is
required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.15,
or if the Borrower is required to pay any additional amount as a result of a
Lender, pursuant to Section 2.02(b), making its Loans through a
particular domestic or foreign branch of such Lender or through an Affiliate of
such Lender, then such Lender shall use reasonable efforts to designate a
different lending office for funding or booking its Loans hereunder or to
assign its rights and obligations hereunder to another of its offices, branches
or Affiliates, if, in the judgment of such Lender, such designation or
assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.13
or 2.15 or as a result of the exercise of its discretion under Section 2.02(b),
as the case may be, in the future, and (ii) would not subject such Lender
to any unreimbursed cost or expense and would not otherwise be disadvantageous
to 

 

31

 

such Lender.  The Borrower hereby agrees to pay all
reasonable costs and expenses incurred by any Lender in connection with any
such designation or assignment.

 

(b)                                 If
any Lender requests compensation under Section 2.13, or if the
Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.15,
or if any Lender defaults in its obligation to fund Loans hereunder, then the
Borrower may, at its sole expense and effort, upon notice to such Lender and
the Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in, and
consents required by, Section 9.04), all its interests, rights and
obligations under this Agreement and the related Loan Documents to an assignee
that shall assume such obligations (which assignee may be another Lender, if a
Lender accepts such assignment); provided that (i) the Borrower
shall have paid to the Administrative Agent the assignment fee specified in Section 9.04,
(ii) such Lender shall have received payment of an amount equal to the
outstanding principal of its Loans, accrued interest thereon, accrued fees and
all other amounts payable to it hereunder, from the assignee (to the extent of
such outstanding principal and accrued interest and fees) or the Borrower (in
the case of all other amounts), (iii) in the case of any such assignment
resulting from a claim for compensation under Section 2.13 or
payments required to be made pursuant to Section 2.15, such
assignment will result in a reduction in such compensation or payments, and (iv) such
assignment does not conflict with applicable laws.  A Lender shall not be required to make any
such assignment and delegation if, prior thereto, as a result of a waiver by
such Lender or otherwise, the circumstances entitling the Borrower to require
such assignment and delegation cease to apply.

 

SECTION 2.18.  Increase in Commitments.

 

(a)                                  Provided
no Default has occurred and is continuing, upon notice to the Administrative
Agent (which shall promptly notify the Lenders), the Borrower may from time to
time, request an increase in the aggregate amount of the Commitments by an
amount (for all such requests) not exceeding $25,000,000 in the aggregate; provided
that any such request for an increase shall be in a minimum amount of
$10,000,000.  Any such increase in the
aggregate Commitments may be provided by any Lender willing to participate in
such increase (each such Lender, a “Participating Lender”), or, subject
to the approval of the Administrative Agent, Eligible Assignees designated by
the Borrower that are willing to participate in such increase (each, an “Increasing
Lender”) and to become Lenders pursuant to a “Joinder Agreement”, in form
and substance reasonably satisfactory to the Administrative Agent, pursuant to
which such Increasing Lender shall become a party to this Agreement.  The Administrative Agent and the Borrower
shall determine (A) the final allocation of such increase among the
Participating Lenders and Increasing Lenders and Schedule 2.01 attached
hereto shall be automatically updated to reflect the same and (B) the
effective date (the “Increase Effective Date”) of any such
increase.  Nothing contained herein shall
constitute, or otherwise be deemed to be, a commitment on the part of any
Lender to increase its Commitment hereunder.

 

(b)                                 As
a condition precedent to such increase, the Borrower shall deliver to the
Administrative Agent a certificate of the Borrower dated as of the Increase
Effective Date (in 

 

32

 

sufficient copies
for each Lender) signed by a duly authorized officer of the Borrower (i) certifying
and attaching the resolutions adopted by the Borrower approving or consenting
to such increase (which may be covered in resolutions authorizing Borrowings on
and after the Closing Date), and (ii) certifying that, before and after
giving effect to such increase, (A) the representations and warranties
contained in Article III and the other Loan Documents are true and
correct on and as of the Increase Effective Date, except to the extent that
such representations and warranties specifically refer to an earlier date, in
which case they are true and correct as of such earlier date, and except that
for purposes of this Section 2.18, the representations and
warranties contained in Section 3.04(a) shall be deemed to refer to
the most recent financial statements furnished in connection with the
statements delivered pursuant to clauses (a) and (b) of Section 5.01,
and (B) no Default has occurred and is continuing.  The Borrower shall prepay any Loans
outstanding on the Increase Effective Date (and pay any additional amounts
required pursuant to Section 2.14) to the extent necessary to keep
the outstanding Loans ratable with any revised Applicable Percentages arising
from any nonratable increase in the Commitments under this Section.

 

(c)                                  This
Section 2.18 shall supersede any provisions in Section 2.16(c)
or Section 9.02 to the contrary.

 

ARTICLE III

Representations and Warranties

 

The Borrower represents and warrants to the
Lenders that:

 

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

 

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

 

33

 

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

 

SECTION 3.04.  Financial Condition; No Material Adverse
Effect.  (a)  The Borrower has
heretofore furnished to the Lenders its consolidated balance sheet and
statements of income, stockholders equity and cash flows (i) as of and for
the fiscal years ended 2006 and 2007, reported on by KPMG LLP, an independent
registered public accounting firm, and (ii) as of and for the fiscal
quarters and the portion of the fiscal year ended March 31, 2008 and June 30,
2008, certified by its chief financial officer. 
Such financial statements present fairly, in all material respects, the
financial position and results of operations and cash flows of the Borrower and
its consolidated Subsidiaries as of such dates and for such periods in
accordance with GAAP, subject to year-end audit adjustments and the absence of
footnotes in the case of the statements referred to in clause (ii) above.  The Borrower and its Subsidiaries do not have
any Guarantees, contingent liabilities, or any long-term leases or unusual
forward or long-term commitments, including any interest rate or foreign
currency swap or exchange transaction or other obligation in respect of
derivatives, in each case, that are required by GAAP to be reflected or
disclosed in such financial statements, that are not reflected or disclosed in
the most recent financial statements referred to in this paragraph, except as
disclosed on Schedule 3.04.

 

(b)                                 Since
December 31, 2007, there has been no event, development or circumstance
that has had or could reasonably be expected, either individually or in the
aggregate, to have a Material Adverse Effect (other than the Disclosed
Matters).

 

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

 

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

 

SECTION 3.06.  Litigation and Environmental Matters.  (a)  There are no actions, suits or
proceedings by or before any arbitrator or Governmental Authority pending
against or, to the knowledge of the Borrower, threatened against or affecting
the Borrower or any of its Subsidiaries (i) as to which there is a
reasonable possibility of an adverse determination and that, 

 

34

 

if adversely determined,
could reasonably be expected, individually or in the aggregate, to result in a
Material Adverse Effect (other than the Disclosed Matters), or (ii) that
involve this Agreement, the other Loan Documents or the Transactions.

 

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

 

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

 

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

 

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

 

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

 

SECTION 3.09.  Taxes. 
Each of the Borrower and its Subsidiaries has timely filed or caused to
be filed all Tax returns and reports required to have been filed and has paid
or caused to be paid all Taxes required to have been paid by it, except (a) Taxes
that are being contested in good faith by appropriate proceedings and for which
the Borrower or such 

 

35

 

Subsidiary, as
applicable, has set aside on its books adequate reserves, or (b) to the
extent that the failure to do so could not reasonably be expected to result in
a Material Adverse Effect.

 

SECTION 3.10.  ERISA. 
No ERISA Event has occurred or is reasonably expected to occur that,
when taken together with all other such ERISA Events for which a liability is
reasonably expected to occur, could reasonably be expected to result in a
Material Adverse Effect.  The present
value of all accumulated benefit obligations under each Plan (based on the
assumptions used for purposes of Statement of Financial Accounting Standards No. 158)
did not, as of the date of the most recent audited financial statements
reflecting such amounts, exceed by more than $5,000,000 the fair market value
of the assets of such Plan, and the present value of all accumulated benefit
obligations of all underfunded Plans (based on the assumptions used for
purposes of Statement of Financial Accounting Standards No. 158) did not,
as of the date of the most recent audited financial statements reflecting such
amounts, exceed by more than $10,000,000 the fair market value of the assets of
all such underfunded Plans.

 

SECTION 3.11.  Disclosure.  The Borrower has disclosed or made available
to the Lenders all agreements and instruments to which it or any of its
Subsidiaries is subject, and all other matters known to it, that, individually
or in the aggregate, could reasonably be expected to result in a Material
Adverse Effect.  None of the reports,
financial statements, certificates or other information furnished by or on
behalf of the Borrower to the Administrative Agent or any Lender in connection
with the execution and delivery of this Agreement or the other Loan Documents
or furnished to the Lenders pursuant hereto or thereto (as modified or
supplemented by other information so furnished) contains any material
misstatement of fact or omits to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided that, with respect to projected financial
information and forward-looking statements, the Borrower represents only that
such information was prepared in good faith based upon assumptions believed to
be reasonable at the time.

 

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

 

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

 

36

 

nonassessable and are
owned free and clear of all Liens.  All
of the outstanding Capital Stock in the Borrower has been validly issued and
are fully paid and nonassessable.

 

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

 

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

 

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

 

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

 

ARTICLE IV

Conditions

 

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

 

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

 

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

 

37

 

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

 

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

 

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

 

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

 

(vi)                              a
certificate signed by the President, a Vice President or a Financial Officer of
the Borrower, certifying (a) that the representations and warranties of
the Borrower set forth in this Agreement are true and correct on and as of the
Closing Date, (b) that no Default has occurred and is continuing as of the
Closing Date or would result from any Borrowing to occur on the Closing Date, (c) that
since December 31, 2007, there has been no event, development or
circumstance that has had or could reasonably be expected, either individually
or in the aggregate, to have a Material Adverse Effect, and (d) the
current Debt Ratings of the Borrower;

 

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

 

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

 

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

 

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

 

38

 

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

 

(d)                                 The
Lenders shall have received (a) audited consolidated financial statements
of the Borrower for the 2006 and 2007 fiscal years, and (b) unaudited
interim consolidated financial statements of the Borrower for each quarterly
period ended subsequent to the date of the latest applicable financial
statements delivered pursuant to clause (a) of this paragraph as to
which such financial statements are available, and such financial statements
shall not, in the reasonable judgment of the Lenders, reflect any material
adverse change in the consolidated financial condition of the Borrower, as
reflected in the financial statements or projections contained in the
Confidential Information Memorandum.

 

(e)                                  The
Closing Date shall have occurred on or before October 6, 2008.

 

The Administrative Agent shall notify the Borrower and the Lenders of
the Closing Date, and such notice shall be conclusive and binding.  Notwithstanding the foregoing, the
obligations of the Lenders to make Loans hereunder shall not become effective
unless each of the foregoing conditions is satisfied (or waived pursuant to Section 9.02)
at or prior to 5:00 p.m., New York City time, on October 6, 2008
(and, in the event such conditions are not so satisfied or waived, the
Commitments shall terminate at such time).

 

Without limiting the generality of the provisions of the last paragraph
of Section 8.03, for purposes of determining compliance with the
conditions specified in this Section 4.01, each Lender that has
signed this Agreement shall be deemed to have consented to, approved or
accepted or to be satisfied with, each document or other matter required
thereunder to be consented to or approved by or acceptable or satisfactory to a
Lender unless the Administrative Agent shall have received notice from such
Lender prior to the proposed Closing Date specifying its objection thereto.

 

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

 

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

 

39

 

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

 

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

 

Each Borrowing and the increase of the aggregate Commitments pursuant
to Section 2.18 shall be deemed to constitute a representation and
warranty by the Borrower on the date thereof as to the matters specified in paragraphs
(a) and (b) of this Section (with references to “such
Borrowing” being deemed to be references to any such increase, as appropriate),
provided that such increase of the aggregate Commitments shall also be
deemed to constitute a representation and warranty by the Borrower that the
matters specified in Section 3.04(b) are true and correct on
and as of the date thereof.

 

ARTICLE V

 

Affirmative Covenants

 

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

 

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

 

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

 

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

 

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

 

(d)                                 promptly
after the same become publicly available, copies of all annual reports on Form 10-K,
all quarterly reports on Form 10-Q, all reports on Form 8-K (except
for such reports required to be filed pursuant to Item 2.02 of Form 8-K)
and all proxy statements,

 

40

 

filed by the Borrower or
any Subsidiary with the SEC, or with any national securities exchange, or
distributed by the Borrower to its shareholders generally, as the case may be;

 

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

 

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

 

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

 

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

 

Documents required to be delivered pursuant to paragraphs (a), (b) and
(d) of this Section 5.01 (to the extent any such documents are
included in materials otherwise filed with the SEC) shall be deemed to have
been delivered on the date on which the Borrower provides notice to the
Administrative Agent and/or the Lenders, as required, as the case may be, that
such documents have been posted on the Borrower’s website on the Internet at
the website address listed on Schedule 9.01 or at such other website
address listed in such notice and accessible by the Administrative Agent and
the Lenders without charge (whether a commercial, third-party website or
whether sponsored by the Administrative Agent); provided that the
Borrower shall deliver paper copies of the reports and financial statements
referred to in paragraphs (a), (b) and (d) of this Section 5.01
to the Administrative Agent or any Lender who requests the Borrower to deliver
such paper copies until written notice to cease delivering paper copies is
given by the Administrative Agent or such Lender.  The Administrative Agent shall have no
obligation to request the delivery or to maintain copies of the documents
referred to above, and in any event shall have no responsibility to monitor
compliance by the Borrower with any such request for delivery, and each Lender
shall be solely responsible for requesting delivery to it or maintaining its copies
of such documents.

 

41

 

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

 

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

 

(a)                                  the
occurrence of any Default;

 

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

 

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

 

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

 

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

 

42

 

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

 

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

 

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

 

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

 

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

 

SECTION 5.05.  Maintenance of Properties; Insurance.  The Borrower will, and will cause each of its
Subsidiaries to, (a) keep and maintain all property material to the
conduct of its business in good working order and condition, ordinary wear and
tear excepted, and (b) maintain, with financially sound and reputable
insurance companies not Affiliates of the Borrower, insurance in such amounts
and against such risks as are customarily maintained by companies engaged in
the same or similar businesses operating in the same or similar locations.

 

SECTION 5.06.  Books and Records; Inspection Rights.  The Borrower will, and will cause each of its
Subsidiaries to, (a) keep proper books of record and account in which
full,

 

43

 

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

 

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

 

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

 

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

 

44

 

ARTICLE VI

 

Negative Covenants

 

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

 

SECTION 6.01.  Financial Condition Covenants.

 

(a)                                  Consolidated
Leverage Ratio.  The Borrower shall
not permit the Consolidated Leverage Ratio as at the last day of any period of
four consecutive fiscal quarters of the Borrower ending with any fiscal quarter
to equal or exceed the ratio of 3.0 to 1.0.

 

(b)                                 Consolidated
Interest Coverage Ratio.  The
Borrower shall not permit the Consolidated Interest Coverage Ratio for any
period of four consecutive fiscal quarters of the Borrower ending with any
fiscal quarter to be less than or equal to the ratio of 4.0 to 1.0.

 

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

 

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

 

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

 

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

 

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

 

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

 

45

 

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

 

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

 

(a)                                  Permitted
Encumbrances;

 

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

 

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

 

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

 

SECTION 6.04.  Fundamental Changes.  (a)  The Borrower will not, and will not
permit any Subsidiary to, merge into or consolidate with any other Person, or
permit any other Person to merge into or consolidate with it, or sell,
transfer, lease or otherwise dispose of (in one transaction or in a series of
transactions) all or substantially all of its assets, or all or substantially
all of the stock of any of its Subsidiaries (in each case, whether now owned or
hereafter acquired), or liquidate or dissolve, except that, if at the time
thereof and immediately after giving effect thereto no Default shall have
occurred and be continuing (i) any other Person, including a Subsidiary,
may merge into the Borrower in a transaction in which the Borrower is the
surviving corporation, (ii) any Subsidiary may merge into any Subsidiary
in a transaction in which the surviving entity is a Subsidiary, (iii) any
Subsidiary may sell, transfer, lease or otherwise dispose of its assets to the
Borrower or to another Subsidiary, (iv) any Subsidiary may liquidate or

 

46

 

dissolve if the Borrower
determines in good faith that such liquidation or dissolution is in the best
interests of the Borrower and is not materially disadvantageous to the Lenders,
and (v) so long as no Event of Default has occurred or is continuing or
would result therefrom, the Borrower may merge into or consolidate with another
Person in a transaction in which such other Person is the surviving entity if
such other Person (x) is organized and validly existing under the laws of
the United States or any State thereof, (y) such Person shall assume all
obligations of the Borrower hereunder, pursuant to an assumption agreement in
form and substance reasonably satisfactory to the Administrative Agent, and (z) the
Administrative Agent shall have received a favorable opinion of counsel to such
other Person covering such matters relating to such assumption as the
Administrative Agent may reasonably request, and which opinion shall otherwise
be in form and substance satisfactory to the Administrative Agent; provided
that any such merger involving a Person that is not a wholly owned Subsidiary
immediately prior to such merger shall not be permitted unless also permitted
by Section 6.05.

 

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

 

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

 

(i)                                     Permitted
Investments;

 

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

 

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

 

(iv)                              Guarantees
constituting Indebtedness permitted by Section 6.02;

 

(v)                                 Permitted
Acquisitions; and

 

(vi)                              other
investments, loans, advances, guarantees or acquisitions in an aggregate
principal amount not exceeding $25,000,000 at any time outstanding.

 

47

 

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

 

SECTION 6.06.  Restricted Payments.  The Borrower will not, and will not permit
any of its Subsidiaries to, declare or make, or agree to pay or make, directly
or indirectly, any Restricted Payment, except (a) the Borrower or any of
its Subsidiaries may declare and pay dividends (whether in cash, securities or
other property) with respect to its capital stock provided that, in the case of
any such declaration or payment by the Borrower, no Default or Event of Default
has occurred or is continuing or would result therefrom, (b) the Borrower
may make Restricted Payments pursuant to and in accordance with stock option
plans or other benefit plans for management or employees of the Borrower and
its Subsidiaries, and (c) the Borrower may, in addition to the foregoing,
repurchase shares of the Borrower’s Class A Common Stock and options
therefor granted by the Borrower pursuant to its employee stock option plans.

 

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

 

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

 

48

 

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

 

SECTION 6.10.  Sales and Leasebacks.  The Borrower will not, and will not permit
any of its Subsidiaries to, enter into any arrangement with any Person
providing for the leasing by the Borrower or any Subsidiary of real or personal
property that has been or is to be sold or transferred by the Borrower or such
Subsidiary to such Person or to any other Person to whom funds have been or are
to be advanced by such Person on the security of such property or rental
obligations of the Borrower or such Subsidiary (a “Sale/Leaseback
Transaction”), except Sale/Leaseback Transactions entered into with respect
to the real property listed on Schedule 6.10.

 

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

 

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

 

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

 

ARTICLE VII

Events of Default

 

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

 

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

 

49

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

(i)            the Borrower or any Subsidiary shall
(i) voluntarily commence any proceeding or file any petition seeking
liquidation, reorganization or other relief under any Federal, state or foreign
bankruptcy, insolvency, receivership or similar law now or hereafter in 

 

50

 

effect, (ii) consent
to the institution of, or fail to contest in a timely and appropriate manner,
any proceeding or petition described in clause (h) of this Article,
(iii) apply for or consent to the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for the Borrower or
any Subsidiary or for a substantial part of its assets, (iv) file an
answer admitting the material allegations of a petition filed against it in any
such proceeding, (v) make a general assignment for the benefit of
creditors, or (vi) take any action for the purpose of effecting any of the
foregoing;

 

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

 

(k)           one or more judgments for the payment
of money in an aggregate amount in excess of $10,000,000 shall be rendered
against the Borrower, any Subsidiary or any combination thereof and the same
shall remain undischarged for a period of 30 consecutive days during which
execution shall not be effectively stayed, or any action shall be legally taken
by a judgment creditor to attach or levy upon any assets of the Borrower or any
Subsidiary to enforce any such judgment;

 

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

 

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

 

(n)           a Change in Control shall occur;

 

then, and in every such event (other than an event with respect to the
Borrower described in clause (h) or (i) of this
Article), and at any time thereafter during the continuance of such event, the
Administrative Agent may, and at the request of the Required Lenders shall, by
notice to the Borrower, take either or both of the following actions, at the
same or different times:  (i) terminate
the Commitments, and thereupon the Commitments shall terminate immediately, and/or
(ii) declare the Loans then outstanding to be due and payable in whole (or
in part, in which case any principal not so declared to be due and payable may
thereafter be declared to be due and payable), and thereupon the principal of
the Loans so declared to be due and payable, together with accrued interest
thereon and all fees and other obligations of the Borrower accrued hereunder,
shall become due and payable immediately, without presentment, demand, protest
or other notice of any kind, all of which are hereby waived by the Borrower;
and in case of any event with respect to the Borrower described in clause (h) or
(i) of this Article, the Commitments shall automatically terminate
and the principal of the Loans then outstanding, together with 

 

51

 

accrued interest thereon and all fees and other obligations of the
Borrower accrued hereunder, shall automatically become due and payable, without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Borrower.

 

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

 

(i)            First,
to payment of that portion of the obligations constituting fees, indemnities,
expenses and other amounts (including fees, charges and disbursements of
counsel to the Administrative Agent and amounts payable under Sections 2.13,
2.14 and 2.15) payable to the Administrative Agent in its capacity
as such;

 

(ii)           Second,
to payment of that portion of the obligations constituting fees, indemnities
and other amounts (other than principal and interest) payable to the Lenders
(including fees, charges and disbursements of counsel to the respective Lenders
and amounts payable under Sections 2.13, 2.14 and 2.15),
ratably among them in proportion to the respective amounts described in this
clause Second payable to them;

 

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

 

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

 

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

 

ARTICLE VIII

The Administrative Agent

 

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

 

52

 

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

 

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

 

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

 

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

 

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

 

The Administrative Agent shall not be liable for any action taken or
not taken by it (i) with the consent or at the request of the Required
Lenders (or such other number or percentage of the Lenders as shall be
necessary, or as the Administrative Agent shall believe in good faith shall be
necessary, under the circumstances as provided in Sections 9.02 and Article VII)
or (ii) in the absence of its own gross negligence or willful
misconduct.  The Administrative Agent
shall be deemed not to have knowledge of any Default unless and until written
notice describing such Default is given to the Administrative Agent by the
Borrower or a Lender.

 

The Administrative Agent shall not be responsible for or have any duty
to ascertain or inquire into (i) any statement, warranty or representation
made in or in connection with this Agreement or any other Loan Document, (ii) the
contents of any certificate, report or other document delivered hereunder or
thereunder or in connection herewith or therewith, (iii) the performance
or observance of any of the covenants, agreements or other terms or conditions
set forth herein or therein or the occurrence of any Default, (iv) the
validity, enforceability, effectiveness or 

 

53

 

genuineness of this Agreement, any other Loan Document or any other
agreement, instrument or document or (v) the satisfaction of any condition
set forth in Article IV or elsewhere herein, other than to confirm
receipt of items expressly required to be delivered to the Administrative
Agent.

 

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

 

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

 

SECTION 8.06.  Resignation of Administrative Agent.  The Administrative Agent may at any time give
notice of its resignation to the Lenders and the Borrower.  Upon receipt of any such notice of
resignation, the Required Lenders shall have the right, in consultation with
the Borrower, to appoint a successor, which shall be a bank with an office in
the United States, or an Affiliate of any such bank with an office in the
United States.  If no such successor
shall have been so appointed by the Required Lenders and shall have accepted
such appointment within 30 days after the retiring Administrative Agent
gives notice of its resignation, then the retiring Administrative Agent may on
behalf of the Lenders, appoint a successor Administrative Agent meeting the
qualifications set forth above; provided that if the Administrative
Agent shall notify the Borrower and the Lenders that no qualifying Person has
accepted such appointment, then such resignation shall nonetheless become
effective in accordance with such notice and (1) the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder and under the other Loan Documents and (2) all payments,
communications and determinations provided to be made by, to or through the
Administrative 

 

54

 

Agent shall instead be
made by or to each Lender directly, until such time as the Required Lenders
appoint a successor Administrative Agent as provided for above in this Section.  Upon the acceptance of a successor’s
appointment as Administrative Agent hereunder, such successor shall succeed to
and become vested with all of the rights, powers, privileges and duties of the
retiring (or retired) Administrative Agent, and the retiring Administrative
Agent shall be discharged from all of its duties and obligations hereunder or
under the other Loan Documents (if not already discharged therefrom as provided
above in this Section).  The fees payable
by the Borrower to a successor Administrative Agent shall be the same as those
payable to its predecessor unless otherwise agreed between the Borrower and
such successor.  After the retiring
Administrative Agent’s resignation hereunder and under the other Loan
Documents, the provisions of this Article and Section 9.03
shall continue in effect for the benefit of such retiring Administrative Agent,
its sub-agents and their respective Related Parties in respect of any actions
taken or omitted to be taken by any of them while the retiring Administrative
Agent was acting as Administrative Agent.

 

SECTION 8.07.  Non-Reliance on Administrative Agent and
Other Lenders.  Each Lender
acknowledges that it has, independently and without reliance upon the
Administrative Agent or any other Lender or any of their Related Parties and
based on such documents and information as it has deemed appropriate, made its
own credit analysis and decision to enter into this Agreement.  Each Lender also acknowledges that it will,
independently and without reliance upon the Administrative Agent or any other
Lender or any of their Related Parties and based on such documents and
information as it shall from time to time deem appropriate, continue to make
its own decisions in taking or not taking action under or based upon this
Agreement, any other Loan Document or any related agreement or any document
furnished hereunder or thereunder.

 

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

 

ARTICLE IX

 

Miscellaneous

 

SECTION 9.01.  Notices; Effectiveness; Electronic
Communication.

 

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

 

55

 

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

 

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

 

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

 

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

 

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

 

(c)           THE PLATFORM IS PROVIDED “AS IS”
AND “AS AVAILABLE.”  THE AGENT PARTIES
(AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER
MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR
ERRORS IN OR OMISSIONS FROM THE BORROWER MATERIALS.  NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR
STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR
OTHER CODE DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTION WITH THE 

 

56

 

BORROWER MATERIALS
OR THE PLATFORM.  In no event shall the
Administrative Agent or any of its Related Parties (collectively, the “Agent
Parties”) have any liability to the Borrower, any Lender or any other
Person for losses, claims, damages, liabilities or expenses of any kind
(whether in tort, contract or otherwise) arising out of the Borrower’s or the
Administrative Agent’s transmission of Borrower Materials through the Internet,
except to the extent that such losses, claims, damages, liabilities or expenses
are determined by a court of competent jurisdiction by a final and
nonappealable judgment to have resulted from the gross negligence or willful
misconduct of such Agent Party; provided, however, that in no
event shall any Agent Party have any liability to the Borrower, any Lender or
any other Person for indirect, special, incidental, consequential or punitive
damages (as opposed to direct or actual damages).

 

(d)           Each of the Borrower and the
Administrative Agent Lender may change its address, telecopier or telephone
number for notices and other communications hereunder by notice to the other
parties hereto.  Each other Lender may
change its address, telecopier or telephone number for notices and other
communications hereunder by notice to the Borrower, and the Administrative Agent.  In addition, each Lender agrees to notify the
Administrative Agent from time to time to ensure that the Administrative Agent
has on record (i) an effective address, contact name, telephone number,
telecopier number and electronic mail address to which notices and other
communications may be sent and (ii) accurate wire instructions for such
Lender.  Furthermore, each Public Lender
agrees to cause at least one individual at or on behalf of such Public Lender
to at all times have selected the “Private Side Information” or similar
designation on the content declaration screen of the Platform in order to
enable such Public Lender or its delegate, in accordance with such Public
Lender’s compliance procedures and applicable law, including United States
Federal and state securities laws, to make reference to Borrower Materials that
are not made available through the “Public Side Information” portion of the
Platform and that may contain material non-public information with respect to
the Borrower or its securities for purposes of United States Federal or state
securities laws.

 

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

 

SECTION 9.02.  Waivers; Amendments; Enforcement.  (a)  No failure or delay by the
Administrative Agent or any Lender in exercising any right or power hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other or further exercise thereof
or the exercise of any other right or power. 
The rights and remedies of the Administrative Agent and the Lenders
hereunder are cumulative and are not exclusive of 

 

57

 

any rights or remedies that
they would otherwise have.  No waiver of
any provision of this Agreement or any other Loan Document or consent to any
departure by the Borrower therefrom shall in any event be effective unless the
same shall be permitted by paragraph (b) of this Section, and then such
waiver or consent shall be effective only in the specific instance and for the
purpose for which given.  Without
limiting the generality of the foregoing, the making of a Loan shall not be
construed as a waiver of any Default, regardless of whether the Administrative
Agent or any Lender may have had notice or knowledge of such Default at the
time.

 

(b)           No Loan Document or any provision
thereof may be waived, amended or modified except pursuant to an agreement or
agreements in writing entered into by the Borrower and the Required Lenders or
by the Borrower and the Administrative Agent with the consent of the Required
Lenders; provided that no such agreement shall (i) waive any
condition set forth in Section 4.01(a) without the written
consent of each Lender, (ii) extend or increase the Commitment of any
Lender (or reinstate any Commitment terminated pursuant to Article VII)
without the written consent of such Lender, (iii) reduce the principal
amount of any Loan or reduce the rate of interest thereon, or reduce any fees
payable hereunder, without the written consent of each Lender affected thereby,
(iv) postpone the scheduled date of payment of the principal amount of any
Loan, or any interest thereon, fees or other amounts due to the Lenders (or any
of them), or reduce the amount of, waive or excuse any such payment, or
postpone the scheduled date of expiration of any Commitment, without the
written consent of each Lender affected thereby, (v) change Section 2.16(b) or
(c) in a manner that would alter the pro rata sharing of payments
required thereby, without the written consent of each Lender, or (vi) change
any of the provisions of this Section or the definition of “Required
Lenders” or any other provision hereof specifying the number or percentage of
Lenders required to waive, amend or modify any rights hereunder or make any
determination or grant any consent hereunder, without the  written consent of each Lender; provided
further that (x) no such agreement shall amend, modify or otherwise
affect the rights or duties of the Administrative Agent hereunder without the
prior written consent of the Administrative Agent, and (y) the Fee Letter
may be amended, or rights or privileges thereunder waived, in a writing
executed only by the parties thereto.

 

(c)           Notwithstanding anything to the
contrary contained herein or in any other Loan Document, the authority to
enforce rights and remedies hereunder and under the other Loan Documents
against the Borrower shall be vested exclusively in, and all actions and
proceedings at law in connection with such enforcement shall be instituted and
maintained exclusively by, the Administrative Agent in accordance with Article VII
for the benefit of all the Lenders; provided, however, that the
foregoing shall not prohibit (a) the Administrative Agent from exercising
on its own behalf the rights and remedies that inure to its benefit (solely in
its capacity as Administrative Agent) hereunder and under the other Loan
Documents, (b) any Lender from exercising setoff rights in accordance with
Section 9.08 (subject to the terms of Section 2.16), or
(c) any Lender from filing proofs of claim or appearing and filing
pleadings on its own behalf during the pendency of a proceeding relative to the
Borrower under any bankruptcy or insolvency proceeding; and provided, further,
that if at any time there is no Person acting as Administrative Agent hereunder
and under the other Loan Documents, then (i) the Required Lenders shall
have the rights otherwise ascribed to the Administrative Agent pursuant to Article VII
and (ii) in addition to the matters set forth in clauses (b) and
(c) of the preceding proviso and 

 

58

 

subject to Section 2.16,
any Lender may, with the consent of the Required Lenders, enforce any rights
and remedies available to it and as authorized by the Required Lenders.

 

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

 

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

 

(c)           To the extent that the Borrower for
any reason fails to indefeasibly pay any amount required under subsection (a) or (b) of
this Section to be paid by it to the 

 

59

 

Administrative
Agent (or any sub-agent thereof), or any Related Party of the Administrative
Agent, each Lender severally agrees to pay to the Administrative Agent (or any
such sub-agent), or such Related Party, as the case may be, such Lender’s
Applicable Percentage (determined as of the time that the applicable unreimbursed
expense or indemnity payment is sought) of such unpaid amount, provided
that the unreimbursed expense or indemnified loss, claim, damage, liability or
related expense, as the case may be, was incurred by or asserted against the
Administrative Agent (or any such sub-agent) in its capacity as such, or
against any such Related Party acting for the Administrative Agent (or any such
sub-agent) in connection with such capacity. 
The obligations of the Lenders under this subsection (c) are
subject to the provisions of Section 2.16(e).

 

(d)           To the fullest extent permitted by
applicable law, the Borrower shall not assert, and hereby waives, any claim
against any Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages)
arising out of, in connection with, or as a result of, this Agreement, any
other Loan Document or any agreement or instrument contemplated hereby, the
transactions contemplated hereby or thereby, any Loan or the use of the
proceeds thereof.  No Indemnitee referred
to in subsection (b) above shall be liable for any damages arising
from the use by unintended recipients of any information or other materials
distributed to such unintended recipients by such Indemnitee through
telecommunications, electronic or other information transmission systems in
connection with this Agreement or the other Loan Documents or the transactions
contemplated hereby or thereby other than for direct or actual damages
resulting from the gross negligence or willful misconduct of such Indemnitee as
determined by a final and nonappealable judgment of a court of competent
jurisdiction.

 

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

 

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

 

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

 

60

 

Administrative Agent and
the Lenders) any legal or equitable right, remedy or claim under or by reason
of this Agreement.

 

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

 

(i)            Minimum
Amounts.

 

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

 

(B)           in any case not described in subsection
(b)(i)(A) of this Section, the aggregate amount of the Commitment
(which for this purpose includes Loans outstanding thereunder) or, if the
Commitment is not then in effect, the principal outstanding balance of the
Loans of the assigning Lender subject to each such assignment, determined as of
the date the Assignment and Assumption with respect to such assignment is
delivered to the Administrative Agent or, if “Trade Date” is specified in the
Assignment and Assumption, as of the Trade Date, shall not be less than
$5,000,000 unless each of the Administrative Agent and, so long as no Event of
Default has occurred and is continuing, the Borrower otherwise consents (each
such consent not to be unreasonably withheld or delayed); provided, however,
that concurrent assignments to members of an Assignee Group and concurrent
assignments from members of an Assignee Group to a single Eligible Assignee (or
to an Eligible Assignee and members of its Assignee Group) will be treated as a
single assignment for purposes of determining whether such minimum amount has
been met.

 

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

 

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

 

61

 

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

 

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

 

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

 

(v)           No
Assignment to Borrower.  No such
assignment shall be made to the Borrower or any of the Borrower’s Affiliates or
Subsidiaries.

 

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

 

Subject to acceptance and recording thereof by the Administrative Agent
pursuant to subsection (c) of this Section, from and after the
effective date specified in each Assignment and Assumption, the assignee
thereunder shall be a party to this Agreement and, to the extent of the
interest assigned by such Assignment and Assumption, have the rights and
obligations of a Lender under this Agreement, and the assigning Lender
thereunder shall, to the extent of the interest assigned by such Assignment and
Assumption, be released from its obligations under this Agreement (and, in the
case of an Assignment and Assumption covering all of the assigning Lender’s
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto) but shall continue to be entitled to the benefits of Sections
2.13, 2.14, 2.15 and 9.03 with respect to facts and
circumstances occurring prior to the effective date of such assignment.  Upon request, the Borrower (at its expense)
shall execute and deliver a Note to the assignee Lender.  Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this
subsection shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with subsection
(d) of this Section.

 

(c)           The Administrative Agent, acting
solely for this purpose as an agent of the Borrower, shall maintain at the
Administrative Agent’s Office a copy of each Assignment and Assumption
delivered to it and a register for the recordation of the names and addresses
of the Lenders, and the Commitments of, and principal amounts of the Loans
owing to, each Lender pursuant to the terms hereof from time to time (the “Register”).  The entries in the Register shall 

 

62

 

be conclusive, and
the Borrower, the Administrative Agent and the Lenders may treat each Person
whose name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement, notwithstanding notice to the
contrary.  The Register shall be
available for inspection by the Borrower and any Lender, at any reasonable time
and from time to time upon reasonable prior notice.

 

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

 

Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce this Agreement and to
approve any amendment, modification or waiver of any  provision of this Agreement; provided
that such agreement or instrument may provide that such Lender will not,
without the consent of the Participant, agree to any amendment, waiver or other
modification described in the first proviso to Section 9.02(b) that
affects such Participant.  Subject to subsection
(e) of this Section, the Borrower agrees that each Participant shall
be entitled to the benefits of Sections 2.13, 2.14 and 2.15  to the same extent as if it were a Lender and had acquired
its interest by assignment pursuant to subsection (b) of this
Section.  To the extent permitted by law,
each Participant also shall be entitled to the benefits of Section 9.08  as though it were a Lender, provided such
Participant agrees to be subject to Section 2.16 as though it were
a Lender.

 

(e)           A Participant shall not be entitled
to receive any greater payment under Section 2.13 or 2.15
than the applicable Lender would have been entitled to receive with respect to
the participation sold to such Participant, unless the sale of the participation
to such Participant is made with the Borrower’s prior written consent.  A Participant that would be a Foreign Lender
if it were a Lender shall not be entitled to the benefits of Section 2.15
unless the Borrower is notified of the participation sold to such Participant
and such Participant agrees, for the benefit of the Borrower, to comply with Section 2.15(e) as
though it were a Lender.

 

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

 

63

 

SECTION 9.05.  Survival.  All representations and warranties made
hereunder and in any other Loan Document or other document delivered pursuant
hereto or thereto or in connection herewith or therewith shall survive the
execution and delivery hereof and thereof. 
Such representations and warranties have been or will be relied upon by
the Administrative Agent and each Lender, regardless of any investigation made
by the Administrative Agent or any Lender or on their behalf and
notwithstanding that the Administrative Agent or any Lender may have had notice
or knowledge of any Default at the time of any Credit Extension, and shall
continue in full force and effect as long as any Loan or any fee or any other
amount payable hereunder shall remain unpaid or unsatisfied.  The provisions of Sections 2.13, 2.14,
2.15 and 9.03 and Article VIII shall survive and
remain in full force and effect regardless of the consummation of the
transactions contemplated hereby, the repayment of the Loans, the expiration or
termination of the Commitments or the termination of this Agreement or any
provision hereof.

 

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

 

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

 

SECTION 9.08.  Right of Setoff.  If an Event of Default shall have occurred
and be continuing, each Lender is hereby authorized at any time and from time
to time, to the fullest extent permitted by law, to set off and apply any and
all deposits (general or special, time or demand, provisional or final) at any
time held and other indebtedness at any time owing by such Lender to or for the
credit or the account of the Borrower against any of and all of the obligations
of the Borrower now or hereafter existing under this Agreement or any other
Loan Document owing to such Lender, irrespective of whether or not such Lender
shall have made any demand under this Agreement or any other Loan Document and
although such obligations may be unmatured. 
The rights of each Lender under this Section are in addition to
other rights and remedies (including other rights of setoff) which such Lender
may have.

 

64

 

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

 

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

 

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

 

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

 

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

 

65

 

BEEN INDUCED TO ENTER
INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE
MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

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

 

SECTION 9.12.  Confidentiality.  Each of the Administrative Agent and the
Lenders agrees to maintain the confidentiality of the Information (as defined
below), except that Information may be disclosed (a) to its Affiliates and
to its and its Affiliates’ respective partners, directors, officers, employees,
agents, trustees, advisors and representatives (it being understood that the
Persons to whom such disclosure is made will be informed of the confidential
nature of such Information and instructed to keep such Information
confidential), (b) to the extent requested by any regulatory authority
purporting to have jurisdiction over it (including any self-regulatory
authority, such as the National Association of Insurance Commissioners), (c) to
the extent required by applicable laws or regulations or by any subpoena or
similar legal process, (d) to any other party hereto, (e) in
connection with the exercise of any remedies hereunder or under any other Loan
Document or any action or proceeding relating to this Agreement or any other
Loan Document or the enforcement of rights hereunder or thereunder, (f) subject
to an agreement containing provisions substantially the same as those of this
Section, to (i) any assignee of or Participant in, or any prospective
assignee of or Participant in, any of its rights or obligations under this
Agreement or any Eligible Assignee invited to be a Lender pursuant to Section 2.18
or (ii) any actual or prospective counterparty (or its advisors) to any
swap or derivative transaction relating to the Borrower and its obligations, (g) with
the consent of the Borrower or (h) to the extent such Information (x) becomes
publicly available other than as a result of a breach of this Section or (y) becomes
available to the Administrative Agent, any Lender or any of their respective
Affiliates on a nonconfidential basis from a source other than the Borrower.

 

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

 

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

 

66

 

SECTION 9.13.  Interest Rate Limitation.  Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Loan, together
with all fees, charges and other amounts which are treated as interest on such
Loan under applicable law (collectively the “Charges”), shall exceed the
maximum lawful rate (the “Maximum Rate”) which may be contracted for,
charged, taken, received or reserved by the Lender holding such Loan in
accordance with applicable law, the rate of interest payable in respect of such
Loan hereunder, together with all Charges payable in respect thereof, shall be
limited to the Maximum Rate and, to the extent lawful, the interest and Charges
that would have been payable in respect of such Loan but were not payable as a
result of the operation of this Section shall be cumulated and the
interest and Charges payable to such Lender in respect of other Loans or
periods shall be increased (but not above the Maximum Rate therefor) until such
cumulated amount, together with interest thereon at the Federal Funds Effective
Rate to the date of repayment, shall have been received by such Lender.

 

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

 

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

 

67

 

Borrower shall, promptly
following a request by the Administrative Agent or any Lender, provide all
documentation and other information that the Administrative Agent or such
Lender requests in order to comply with its ongoing obligations under
applicable “know your customer” and anti-money laundering rules and
regulations, including the Act.

 

[Remainder of Page Left Intentionally Blank]

 

68

 

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

 

 

	
   

  	
  Borrower:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  WADDELL & REED FINANCIAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Daniel P. Connealy

  
	
   

  	
  Name:

  	
  Daniel P. Connealy

  
	
   

  	
  Title:

  	
  Senior Vice President and Chief

  
	
   

  	
   

  	
  Financial Officer

  
				

 

 

	
   

  	
  Administrative
  Agent:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BANK OF AMERICA, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/
  Hichem Kerma

  
	
   

  	
   

  	
  Name:

  	
  Hichem Kerma

  
	
   

  	
   

  	
  Title:

  	
  Assistant Vice President

  

 

 

	
   

  	
  Lenders:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BANK OF AMERICA, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/
  Hichem Kerma

  
	
   

  	
   

  	
  Name:

  	
  Hichem Kerma

  
	
   

  	
   

  	
  Title:

  	
  Assistant Vice President

  

 

 

	
   

  	
  UMB BANK, n.a.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/
  David A. Proffitt

  
	
   

  	
   

  	
  Name:

  	
  David A. Proffitt

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President

  

 

 

	
   

  	
  The Bank of New York Mellon

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/
  Thomas McGinley

  
	
   

  	
   

  	
  Name:

  	
  Thomas McGinely

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  

 

 

	
   

  	
  SOCIETE GENERALE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/
  Edith L. Hornick

  
	
   

  	
   

  	
  Name:

  	
  Edith L. Hornick

  
	
   

  	
   

  	
  Title:

  	
  Managing Director

  

 

 

	
   

  	
  The Bank of Nova Scotia

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ David
  Mahmood

  
	
   

  	
   

  	
  Name:

  	
  David Mahmood

  
	
   

  	
   

  	
  Title:

  	
  Managing Director

  

 

 

	
   

  	
  COMMERCE BANK, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/
  R. David Emley, Jr.

  
	
   

  	
   

  	
  Name:

  	
  R. David Emley, Jr.

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  

 

 

	
   

  	
  BANK MIDWEST, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Brian
  Bower

  
	
   

  	
   

  	
  Name:

  	
  Brian Bower

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  

 

2

 

EXHIBIT A

 

ASSIGNMENT AND
ASSUMPTION

 

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

 

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

 

	
  1.

  	
  Assignor[s]:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  

 

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

 

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

 

3            Select as appropriate.

 

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

 

A-1

 

	
  2.

  	
  Assignee[s]:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

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

  

 

	
  3.

  	
  Borrower:

  	
  Waddell & Reed
  Financial, Inc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  4.

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

  
	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
  Credit Agreement:      Credit
  Agreement, dated as of October 6, 2008 (as amended, restated, extended,
  supplemented or otherwise modified in writing from time to time), among
  Waddell & Reed Financial, Inc., the Lenders from time to time
  party thereto, and Bank of
  America, N.A., as Administrative Agent

  
	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
  Assigned Interest:

  

 

	
  Assignor[s]5

  	
   

  	
  Assignee[s]6

  	
   

  	
  Aggregate

  Amount of

  Commitment

  for all Lenders7

  	
   

  	
  Amount of

  Commitment

  Assigned

  	
   

  	
  Percentage

  Assigned of

  Commitment

  	
   

  	
  CUSIP

  Number

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  %

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  %

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  %

  	
   

  	
   

  

 

	
  [7.

  	
  Trade Date:

  	
                                           ]8

  
	
   

  	
   

  	
   

  	
   

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

  
	
   

  	
   

  	
   

  	
   

  
	
   

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

  

 

	
   

  	
  ASSIGNOR

  	
   

  
	
   

  	
  [NAME OF ASSIGNOR]

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By: 

  	
   

  
	
   

  	
  Title:

  	
   

  
				

 

5            List each Assignor, as appropriate.

 

6            List each Assignee, as appropriate. 

 

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

 

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

 

A-2

 

	
   

  	
  ASSIGNEE

  
	
   

  	
  [NAME OF ASSIGNEE]

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Title:

  
	
   

  
	
  [Consented to and]9 Accepted:

  
	
   

  
	
  BANK OF AMERICA, N.A., as

  
	
  Administrative Agent

  
	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  
	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  [Consented to:]10

  
	
   

  	
   

  
	
  WADDELL & REED FINANCIAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  
	
  Title:

  	
   

  

 

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

 

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

 

A-3

 

ANNEX 1 TO
ASSIGNMENT AND ASSUMPTION

 

STANDARD TERMS AND
CONDITIONS FOR

 

ASSIGNMENT AND
ASSUMPTION

 

1.             Representations
and Warranties.

 

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

 

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

 

A-4

 

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

 

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

 

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

 

A-5

 

EXHIBIT B

 

FORM OF NOTE

	
   

  	
               ,                   

  

 

FOR VALUE RECEIVED, the undersigned (the “Borrower”), hereby promises to pay
to [NAME OF LENDER] or registered assigns (the “Lender”), in accordance with the
provisions of the Agreement (as hereinafter defined), the principal amount of
each Loan from time to time made by the Lender to the Borrower under that
certain Credit Agreement, dated as of October 6, 2008 (as amended,
restated, extended, supplemented or otherwise modified in writing from time to
time, the “Agreement;”
the terms defined therein being used herein as therein defined), among the
Borrower, the Lenders from time to time party thereto, and Bank of America,
N.A., as Administrative Agent.

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

 

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

 

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

 

[Remainder of Page Left Intentionally Blank]

 

B-1

 

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

 

	
   

  	
  WADDELL & REED FINANCIAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

B-2

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  LOANS AND PAYMENTS WITH
  RESPECT

  THERETO

  

 

	
  Date

  	
   

  	
  Type of

  Loan Made

  	
   

  	
  Amount of

  Loan Made

  	
   

  	
  End of

  Interest

  Period

  	
   

  	
  Amount of

  Principal or

  Interest Paid

  This Date

  	
   

  	
  Outstanding

  Principal

  Balance This

  Date

  	
   

  	
  Notation

  Made By

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

B-3

 

Exhibit C-1

 

WADDELL & REED, INC.
MUTUAL FUND MANAGEMENT FEES

2008 Actual ($000)

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  % Inc

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  (Dec)

  	
   

  	
  Total

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  % of

  	
   

  	
  Variance

  	
   

  	
  2007

  	
   

  	
  Year

  	
   

  
	
  Management Fees

  	
   

  	
  Jan

  	
   

  	
  Feb

  	
   

  	
  Mar

  	
   

  	
  Apr

  	
   

  	
  May

  	
   

  	
  Jun

  	
   

  	
  Jul

  	
   

  	
  Aug

  	
   

  	
  Sep

  	
   

  	
  Oct

  	
   

  	
  Nov

  	
   

  	
  Dec

  	
   

  	
  Y-T-D

  	
   

  	
  Total

  	
   

  	
  From L-Y

  	
   

  	
  Actual

  	
   

  	
  2007

  	
   

  
	
  W&R ADVISORS FUNDS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Con’t Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Retirement Shares

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Growth/Income Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Accumulative

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Int’l Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tax-Managed Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Vanguard

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  New Concepts

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Investment

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Equity Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Gov’t Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fixed Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL
  LONG-TERM FUNDS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cash Management

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL W&R ADVISORS FUNDS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  IVY FUNDS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Growth/Income Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Large Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Capital Appreciation

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pacific Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Natural Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  European Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cundill Global Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real Estate Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed European/Pacific

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed International Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Equity Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  IVY FUNDS (cont)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Limited-Term Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

C-1

 

Exhibit C-1

 

WADDELL
& REED, INC. MUTUAL FUND MANAGEMENT FEES

2008
Actual ($000)

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  % Inc

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  (Dec)

  	
   

  	
  Total

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  % of

  	
   

  	
  Variance

  	
   

  	
  2007

  	
   

  	
  Year

  	
   

  
	
  Management Fees

  	
   

  	
  Jan

  	
   

  	
  Feb

  	
   

  	
  Mar

  	
   

  	
  Apr

  	
   

  	
  May

  	
   

  	
  Jun

  	
   

  	
  Jul

  	
   

  	
  Aug

  	
   

  	
  Sep

  	
   

  	
  Oct

  	
   

  	
  Nov

  	
   

  	
  Dec

  	
   

  	
  Y-T-D

  	
   

  	
  Total

  	
   

  	
  From L-Y

  	
   

  	
  Actual

  	
   

  	
  2007

  	
   

  
	
  Global Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   Fixed
  Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL IVY FUNDS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W&R TARGET FUNDS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real Estate Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Natural Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Microcap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL W&R TARGET FUNDS

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  GRAND TOTAL MGMT. FEES

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  DAILY AVERAGE

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fixed

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

C-2

 

Exhibit C-1

 

	
  Change in
  Mutual Fund Assets Under Management

  	
  August 2008

  	
   

  
	
  (Millions)

  	
  Month to Date

  	
   

  

 

	
   

  	
   

  	
  Net Assets

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Net

  	
   

  	
  Net

  	
   

  	
  Dividends

  	
   

  	
  Net Investment

  	
   

  	
  Dividends

  	
   

  	
  Valuation

  	
   

  	
  Net Assets

  	
   

  
	
   

  	
   

  	
  at 7-31-08

  	
   

  	
  Sales

  	
   

  	
  Redemptions

  	
   

  	
  Sales

  	
   

  	
  Exchanges

  	
   

  	
  Reinvested

  	
   

  	
  Income

  	
   

  	
  Paid

  	
   

  	
  Change

  	
   

  	
  at 8-31-08

  	
   

  
	
  Waddell & Reed Advisors Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Accumulative

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cont Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Investment

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Government Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  New Concepts

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Retire Shares

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tax-Managed Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Vanguard

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal of Long -Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cash Management

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Waddell & Reed Advisors Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Capital Appreciation

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cundill Global Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  European Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Natural Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Large Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Limited-Term Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed European/Pacific

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed Int’l Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pacific Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real Estate

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal of Long -Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal of Money Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less Eliminations- Underlying Funds of Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

C-3

 

Exhibit C-1

 

	
  Change in
  Mutual Fund Assets Under Management

  	
  August 2008

  	
   

  
	
  (Millions)

  	
  Month to Date

  	
   

  

 

	
   

  	
   

  	
  Net Assets

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Net

  	
   

  	
  Net

  	
   

  	
  Dividends

  	
   

  	
  Net Investment

  	
   

  	
  Dividends

  	
   

  	
  Valuation

  	
   

  	
  Net Assets

  	
   

  
	
   

  	
   

  	
  at 7-31-08

  	
   

  	
  Sales

  	
   

  	
  Redemptions

  	
   

  	
  Sales

  	
   

  	
  Exchanges

  	
   

  	
  Reinvested

  	
   

  	
  Income

  	
   

  	
  Paid

  	
   

  	
  Change

  	
   

  	
  at 8-31-08

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd
  Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd
  Conservative

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd
  Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy VIP
  Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced Port

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend
  Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Natural
  Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Inc

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Microcap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Mkt

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage
  Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder-
  Agressive Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder-
  Conservative Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder-
  Moderate Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder-
  Moderately Agressive Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder-
  Moderately Conservative Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real Estate

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science &
  Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Port

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less
  Eliminations- Underlying Funds of Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy VIP
  Funds Total *

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Summary
  of All Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Long-Term
  Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money
  Market Funds **

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less
  Eliminations- Underlying InvestEd Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  All
  Mutual Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

C-4

 

Exhibit C -1

 

	
  Change in
  Mutual Fund Assets Under Management

  	
  August 2008

  	
   

  
	
  (Millions)

  	
  Year to Date

  	
   

  

 

	
   

  	
   

  	
  Net Assets

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Net

  	
   

  	
  Net

  	
   

  	
  Dividends

  	
   

  	
  Net Investment

  	
   

  	
  Dividends

  	
   

  	
  Valuation

  	
   

  	
  Net Assets

  	
   

  
	
   

  	
   

  	
  at 12-31-07

  	
   

  	
  Sales

  	
   

  	
  Redemptions

  	
   

  	
  Sales

  	
   

  	
  Exchanges

  	
   

  	
  Reinvested

  	
   

  	
  Income

  	
   

  	
  Paid

  	
   

  	
  Change

  	
   

  	
  at 8-31-2008

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Waddell &
  Reed Advisors Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Accumulative

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cont Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Investment

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend
  Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Government
  Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal High
  Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  New Concepts

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Retire Shares

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science &
  Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tax-Managed
  Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Vanguard

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal
  of Long -Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cash Management

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Waddell &
  Reed Advisors Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy
  Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Capital
  Appreciation

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cundill Global
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend
  Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  European
  Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Natural
  Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Large Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Limited-Term Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed
  European/Pacific

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed Int’l
  Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage
  Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pacific
  Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real Estate

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science &
  Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal
  of Long -Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal
  of Money Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less
  Eliminations- Underlying Funds of Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy
  Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

C-5

 

Exhibit C-1

 

	
  Change in
  Mutual Fund Assets Under Management

  	
  August 2008

  	
   

  
	
  (Millions)

  	
  Year to Date

  	
   

  

 

	
   

  	
   

  	
  Net Assets

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Net

  	
   

  	
  Net

  	
   

  	
  Dividends

  	
   

  	
  Net Investment

  	
   

  	
  Dividends

  	
   

  	
  Valuation

  	
   

  	
  Net Assets

  	
   

  
	
   

  	
   

  	
  at 12-31-07

  	
   

  	
  Sales

  	
   

  	
  Redemptions

  	
   

  	
  Sales

  	
   

  	
  Exchanges

  	
   

  	
  Reinvested

  	
   

  	
  Income

  	
   

  	
  Paid

  	
   

  	
  Change

  	
   

  	
  at 8-31-2008

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd
  Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd
  Conservative

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd
  Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy VIP
  Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced Port

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend
  Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Natural
  Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Inc

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Microcap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Mkt

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage
  Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder-
  Agressive Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder-
  Conservative Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder-
  Moderate Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder-
  Moderately Agressive Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder-
  Moderately Conservative Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real Estate

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science &
  Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Port

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less
  Eliminations- Underlying Funds of Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy VIP
  Funds Total*

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Summary
  of All Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Long-Term
  Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money
  Market Funds **

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less
  Eliminations- Underlying InvestEd Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  All
  Mutual Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

C-6

 

Exhibit C-2

Waddell &
Reed Financial, Inc. - Consolidated

Statement
of Operations

For the period indicated in
each column heading

Dollar amounts in thousands
except per share amounts

 

	
   

  	
   

  	
  QTD

  Aug-2008

  	
   

  	
  QTD

  May-2008

  	
   

  	
  Variance

  Dollars

  	
   

  	
  Variance

  Percent

  	
   

  	
  QTD

  Aug-2008

  	
   

  	
  QTD

  Aug-2007

  	
   

  	
  Variance

  Dollars

  	
   

  	
  Variance

  Percent

  	
   

  	
  YTD

  Aug-2008

  	
   

  	
  YTD

  Aug-2007

  	
   

  	
  Variance

  Dollars

  	
   

  	
  Variance

  Percent

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  REVENUES:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Investment management fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Underwriting & distribution fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Shareholder service fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Investment & other revenue

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL REVENUE

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

	
   

  	
   

  	
  Aug-2007

  	
   

  	
  Sep-2007

  	
   

  	
  Oct-2007

  	
   

  	
  Nov-2007

  	
   

  	
  Dec-2007

  	
   

  	
  Jan-2008

  	
   

  	
  Feb-2008

  	
   

  	
  Mar-2008

  	
   

  	
  Apr-2008

  	
   

  	
  May-2008

  	
   

  	
  Jun-2008

  	
   

  	
  Jul-2008

  	
   

  	
  Aug-2008

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  REVENUES:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Investment management fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Underwriting & distribution fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Shareholder service fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Investment & other revenue

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL REVENUE

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

C-7

 

EXHIBIT
D

 

FORM OF REVOLVING BORROWING
REQUEST

 

Date:                          ,
           

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

 

Ladies and Gentlemen:

 

Reference is made to that certain Credit Agreement,
dated as of October 6, 2008 (as amended, restated, extended, supplemented
or otherwise modified in writing from time to time, the “Agreement;” the
terms defined therein being used herein as therein defined), among Waddell &
Reed Financial, Inc. (the “Borrower”), the several financial institutions
from time to time party thereto (collectively, the “Lenders” and each
individually, a “Lender”), and Bank of America, N.A., as administrative
agent for the Lenders (in such capacity, together with any successors thereto
in such capacity, the “Administrative Agent”).

 

The undersigned hereby requests (select one):

 

o  A Borrowing of Loans

 

o  A conversion or continuation of Loans

 

1.        On
                                                                                   
(a Business Day).

 

2.        In
the amount of $

 

3.        Comprised
of                                                                              

[Type of Loan requested/converted/continued]

 

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

 

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

	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  

 

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

 

D-1

 

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

 

	
   

  	
  WADDELL & REED FINANCIAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

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

 

D-2

 

EXHIBIT
E

FORM OF COMPLIANCE CERTIFICATE

 

Financial
Statement Date:                   ,
         

 

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

 

Ladies and Gentlemen:

 

Reference is made to that certain Credit Agreement,
dated as of October 6, 2008 (as amended, restated, extended, supplemented
or otherwise modified in writing from time to time, the “Agreement;” the
terms defined therein being used herein as therein defined), among Waddell &
Reed Financial, Inc. (the “Borrower”), the several financial
institutions from time to time party thereto (collectively, the “Lenders”
and each individually, a “Lender”), and Bank of America, N.A., as
administrative agent for the Lenders (in such capacity, together with any
successors thereto in such capacity, the “Administrative Agent”).

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

[select one:]

 

12 Must
be a Financial Officer.

 

E-1

 

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

 

—or—

 

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

 

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

 

[select
one:]

 

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

 

—or—

 

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

 

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

 

[Remainder of Page Left Intentionally Blank]

 

E-2

 

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

 

	
   

  	
  WADDELL & REED FINANCIAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

E-3

 

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

 

SCHEDULE 1

to the
Compliance Certificate

($ in 000’s)

 

	
  I.

  	
  Section 6.01(a) – Consolidated Leverage Ratio.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  A.

  	
  Consolidated
  Total Debt at Statement Date

  	
   

  	
  $            

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  B.

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

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  1.

  	
  Consolidated
  Net Income for Subject Period:

  	
   

  	
  $            

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  2.

  	
  Income tax
  expense for Subject Period:

  	
   

  	
  $            

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  3.

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

  	
   

  	
  $            

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  4.

  	
  Depreciation
  and amortization expenses for Subject Period:

  	
   

  	
  $            

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  5.

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

  	
   

  	
  $            

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  6.

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

  	
   

  	
  $            13

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  7.

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

  	
   

  	
  $            

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  8.

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

  	
   

  	
  $            

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  C.

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

  	
   

  	
           
  to 1

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Must not equal or exceed a ratio of 3.0 to 1.0

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  In Compliance: Yes / No

  	
   

  	
   

  

 

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

 

E-4

 

	
  II.

  	
  Section 6.01(b) – Consolidated Interest Coverage Ratio.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  A.

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

  	
   

  	
  $            

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  B.

  	
  Consolidated
  Interest Expense for Subject Period:

  	
   

  	
  $            

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  C.

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

  	
   

  	
           
  to 1

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

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

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  In Compliance: Yes / No

  	
   

  	
   

  

 

E-5

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00148-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00148-of-00352.parquet"}]]