Document:

Exhibit 10.26

 

Published
CUSIP Number: 91337LAD8

 

CREDIT AGREEMENT

for

$350,000,000 Term Loan Facility

and

$150,000,000
Revolving Credit Facility

Dated as of September 18, 2007

among

UNIVERSAL AMERICAN FINANCIAL
CORP.,

as
the Borrower,

BANK OF AMERICA, N.A.,

as Administrative Agent, Swing Line Lender and L/C Issuer,

and

THE OTHER LENDERS PARTY HERETO

SUNTRUST BANK

and

U.S. BANK NATIONAL ASSOCIATION,

as
Co-Syndication Agents,

CALYON NEW YORK BRANCH

and

CITIBANK, N.A.,

as Co-Documentation Agents,

and

BANC OF AMERICA SECURITIES LLC,

as Sole Lead Arranger and Sole Book Manager

 

 

 

 

TABLE
OF CONTENTS

	
  Section

  	
   

  	
  Page

  
	
   

  	
   

  
	
  ARTICLE I

  	
   

  
	
  DEFINITIONS AND ACCOUNTING TERMS

  	
   

  
	
   

  	
   

  
	
  1.01

  	
  Defined Terms

  	
  2

  
	
  1.02

  	
  Other Interpretive Provisions

  	
  78

  
	
  1.03

  	
  Accounting Terms

  	
  80

  
	
  1.04

  	
  Rounding

  	
  81

  
	
  1.05

  	
  Times of Day

  	
  81

  
	
  1.06

  	
  Letter of Credit Amounts

  	
  81

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  II

  	
   

  
	
  THE
  COMMITMENTS AND CREDIT EXTENSIONS

  	
   

  
	
   

  	
   

  
	
  2.01

  	
  The Loans

  	
  82

  
	
  2.02

  	
  Borrowings, Conversions and Continuations of Loans

  	
  84

  
	
  2.03

  	
  Letters of Credit

  	
  88

  
	
  2.04

  	
  Swing Line Loans

  	
  114

  
	
  2.05

  	
  Prepayments

  	
  122

  
	
  2.06

  	
  Termination or Reduction of Commitments

  	
  128

  
	
  2.07

  	
  Repayment of Loans

  	
  131

  
	
  2.08

  	
  Interest

  	
  132

  
	
  2.09

  	
  Fees

  	
  134

  
	
  2.10

  	
  Computation of Interest and Fees; Retroactive Adjustments of
  Applicable Rate

  	
  135

  
	
  2.11

  	
  Evidence of Debt

  	
  137

  
	
  2.12

  	
  Payments Generally; Administrative Agent’s Clawback

  	
  138

  
	
  2.13

  	
  Sharing of Payments by Lenders

  	
  144

  
	
  2.14

  	
  Increase in Revolving Credit Facility

  	
  146

  
	
  2.15

  	
  Increase in Term Facility

  	
  151

  
	
  2.16

  	
  Additional Term Facility.

  	
  155

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  III

  	
   

  
	
  TAXES,
  YIELD PROTECTION AND ILLEGALITY

  	
   

  
	
   

  	
   

  
	
  3.01

  	
  Taxes

  	
  159

  
	
  3.02

  	
  Illegality

  	
  165

  
	
  3.03

  	
  Inability to Determine Rates

  	
  166

  
	
  3.04

  	
  Increased Costs

  	
  167

  
	
  3.05

  	
  Compensation for Losses

  	
  172

  
	
  3.06

  	
  Mitigation Obligations; Replacement of Lenders

  	
  173

  
	
  3.07

  	
  Survival

  	
  174

  

 

i

 

	
  ARTICLE
  IV

  	
   

  
	
  CONDITIONS
  PRECEDENT TO CREDIT EXTENSIONS

  	
   

  
	
   

  	
   

  
	
  4.01

  	
  Conditions of Initial Credit Extension

  	
  174

  
	
  4.02

  	
  Conditions to all Credit Extensions

  	
  182

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  V

  	
   

  
	
  REPRESENTATIONS
  AND WARRANTIES

  	
   

  
	
   

  	
   

  
	
  5.01

  	
  Existence, Qualification and Power

  	
  184

  
	
  5.02

  	
  Authorization; No Contravention

  	
  185

  
	
  5.03

  	
  Governmental Authorization; Other Consents

  	
  185

  
	
  5.04

  	
  Binding Effect; Seniority

  	
  186

  
	
  5.05

  	
  Financial Statements; No Material Adverse Effect

  	
  187

  
	
  5.06

  	
  Litigation

  	
  190

  
	
  5.07

  	
  No Default

  	
  190

  
	
  5.08

  	
  Ownership of Property; Liens

  	
  190

  
	
  5.09

  	
  Environmental Compliance

  	
  191

  
	
  5.10

  	
  Insurance

  	
  192

  
	
  5.11

  	
  Taxes

  	
  193

  
	
  5.12

  	
  ERISA Compliance

  	
  193

  
	
  5.13

  	
  Subsidiaries; Loan Parties

  	
  195

  
	
  5.14

  	
  Margin Regulations; Investment Company Act

  	
  195

  
	
  5.15

  	
  Disclosure

  	
  196

  
	
  5.16

  	
  Compliance with Laws

  	
  197

  
	
  5.17

  	
  Intellectual Property; Licenses, Etc.

  	
  197

  
	
  5.18

  	
  Solvency

  	
  198

  
	
  5.19

  	
  Security Interests.

  	
  198

  
	
  5.20

  	
  Insurance Licenses.

  	
  198

  
	
  5.21

  	
  Labor Matters.

  	
  198

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VI

  	
   

  
	
  AFFIRMATIVE
  COVENANTS

  	
   

  
	
   

  	
   

  
	
  6.01

  	
  Financial Statements

  	
  199

  
	
  6.02

  	
  Certificates; Other Information

  	
  204

  
	
  6.03

  	
  Notices

  	
  209

  
	
  6.04

  	
  Payment of Obligations

  	
  210

  
	
  6.05

  	
  Preservation of Existence, Etc.

  	
  212

  
	
  6.06

  	
  Maintenance of Properties

  	
  212

  
	
  6.07

  	
  Maintenance of Insurance

  	
  212

  
	
  6.08

  	
  Compliance with Laws

  	
  213

  
	
  6.09

  	
  Books and Records

  	
  213

  
	
  6.10

  	
  Inspection Rights

  	
  213

  
	
  6.11

  	
  Use of Proceeds

  	
  214

  
	
  6.12

  	
  Covenant to Guarantee Obligations and Give Security

  	
  215

  
	
  6.13

  	
  Compliance with Environmental Laws

  	
  217

  

 

ii

 

	
  6.14

  	
  Further Assurances

  	
  218

  
	
  6.15

  	
  Designation of Subsidiaries as Restricted and Unrestricted.

  	
  219

  
	
  6.16

  	
  A.M. Best Rating.

  	
  220

  
	
  6.17

  	
  S&P Rating.

  	
  220

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VII

  	
   

  
	
  NEGATIVE
  COVENANTS

  	
   

  
	
   

  	
   

  
	
  7.01

  	
  Liens

  	
  221

  
	
  7.02

  	
  Indebtedness

  	
  225

  
	
  7.03

  	
  Investments

  	
  228

  
	
  7.04

  	
  Fundamental Changes

  	
  233

  
	
  7.05

  	
  Dispositions

  	
  235

  
	
  7.06

  	
  Restricted Payments

  	
  237

  
	
  7.07

  	
  Change in Nature of Business

  	
  239

  
	
  7.08

  	
  Transactions with Affiliates

  	
  239

  
	
  7.09

  	
  Burdensome Agreements

  	
  240

  
	
  7.10

  	
  Use of Proceeds

  	
  241

  
	
  7.11

  	
  Financial Covenants.

  	
  241

  
	
  7.12

  	
  Amendments of Organization Documents

  	
  242

  
	
  7.13

  	
  Accounting Changes

  	
  243

  
	
  7.14

  	
  Prepayments, Etc. of Indebtedness

  	
  243

  
	
  7.15

  	
  Amendment, Etc. of Acquisition Agreement and Indebtedness

  	
  243

  
	
  7.16

  	
  Unrestricted Subsidiaries

  	
  244

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  VIII

  	
   

  
	
  EVENTS
  OF DEFAULT AND REMEDIES

  	
   

  
	
   

  	
   

  
	
  8.01

  	
  Events of Default

  	
  244

  
	
  8.02

  	
  Remedies upon Event of Default

  	
  250

  
	
  8.03

  	
  Application of Funds

  	
  251

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  IX

  	
   

  
	
  ADMINISTRATIVE
  AGENT

  	
   

  
	
   

  	
   

  
	
  9.01

  	
  Appointment and Authority

  	
  253

  
	
  9.02

  	
  Rights as a Lender

  	
  255

  
	
  9.03

  	
  Exculpatory Provisions

  	
  255

  
	
  9.04

  	
  Reliance by Administrative Agent

  	
  258

  
	
  9.05

  	
  Delegation of Duties

  	
  258

  
	
  9.06

  	
  Resignation of Administrative Agent

  	
  259

  
	
  9.07

  	
  Non-Reliance on Administrative Agent and Other Lenders

  	
  261

  
	
  9.08

  	
  No Other Duties, Etc.

  	
  262

  
	
  9.09

  	
  Administrative Agent May File Proofs of Claim

  	
  262

  
	
  9.10

  	
  Collateral and Guaranty Matters

  	
  264

  

 

iii

 

	
  ARTICLE
  X

  	
   

  
	
  MISCELLANEOUS

  	
   

  
	
   

  	
   

  
	
  10.01

  	
  Amendments, Etc.

  	
  265

  
	
  10.02

  	
  Notices; Effectiveness; Electronic Communications

  	
  271

  
	
  10.03

  	
  No Waiver; Cumulative Remedies

  	
  276

  
	
  10.04

  	
  Expenses; Indemnity; Damage Waiver

  	
  278

  
	
  10.05

  	
  Payments Set Aside

  	
  284

  
	
  10.06

  	
  Successors and Assigns

  	
  284

  
	
  10.07

  	
  Treatment of Certain Information; Confidentiality

  	
  296

  
	
  10.08

  	
  Right of Setoff.

  	
  298

  
	
  10.09

  	
  Interest Rate Limitation

  	
  299

  
	
  10.10

  	
  Counterparts; Integration; Effectiveness

  	
  300

  
	
  10.11

  	
  Survival of Representations and Warranties

  	
  300

  
	
  10.12

  	
  Severability

  	
  301

  
	
  10.13

  	
  Replacement of Lenders

  	
  301

  
	
  10.14

  	
  Governing Law; Jurisdiction; Etc.

  	
  304

  
	
  10.15

  	
  Waiver of Jury Trial

  	
  306

  
	
  10.16

  	
  No Advisory or Fiduciary Responsibility

  	
  307

  
	
  10.17

  	
  USA PATRIOT Act Notice

  	
  308

  
	
  10.18

  	
  Time of the Essence.

  	
  309

  
	
  10.19

  	
  ENTIRE AGREEMENT.

  	
  309

  
	
   

  	
   

  	
   

  
	
  SIGNATURES

  	
  S-1

  

 

iv

 

SCHEDULES

1.01A              Existing Letters of Credit

1.01B              Immaterial Subsidiaries

1.01C              Unrestricted Subsidiaries

2.01                 Commitments and Applicable Percentages

5.06(a)            Certain Litigation

5.06(b)            Other Litigation

5.08(b)            Existing Liens

5.09                 Environmental Matters

5.12                 ERISA Matters

5.13                 Subsidiaries; Loan Parties

7.02                 Existing Indebtedness

7.09                 Existing Restrictive Contractual Obligations

10.02               Administrative Agent’s Office, Certain Addresses for
Notices

 

EXHIBITS

Form of

 

A                     Committed Loan Notice

B                     Swing Line Loan Notice

C-1                  Term Note

C-2                  Revolving Credit Note

D                     Compliance Certificate

E                      Assignment and Assumption

F                      Subsidiary Guaranty Agreement

G                     Pledge Agreement

H                     Opinion Matters — Counsel to Loan Parties

 

v

CREDIT
AGREEMENT

This CREDIT AGREEMENT (this “Agreement”) is entered into as of September 18, 2007, among
UNIVERSAL AMERICAN FINANCIAL CORP., a New York corporation (the “Borrower”),
each lender from time to time party hereto (collectively, the “Lenders”
and individually, a “Lender”), and BANK OF AMERICA, N.A., as Administrative
Agent, Swing Line Lender and L/C Issuer.

PRELIMINARY
STATEMENTS:

Pursuant to that certain Agreement and Plan
of Merger and Reorganization dated as of May 7, 2007 (together with all exhibits
and schedules thereto, and as amended or modified by the Escrow Documents
(hereinafter defined), collectively, the “Acquisition Agreement”),
among the Borrower, MH Acquisition I Corp., MH Acquisition II LLC, MHRX LLC,
MemberHealth, Inc., and the Shareholder Representative named therein, the
Borrower has agreed to acquire (the “Acquisition”) all of the
outstanding capital stock of MemberHealth, Inc. (the “Acquired Company”, and, together
with its subsidiaries, the “Acquired Business”). After the consummation of the Acquisition, the Acquired Company will
become a Wholly-Owned Subsidiary of the Borrower.

The Borrower has requested that the Lenders
(a) refinance certain existing Indebtedness of the Borrower; (b) finance a
portion of the consideration to be paid in connection with the Acquisition; (c)
provide financing for the working capital and general corporate purposes of the
Borrower and its Restricted Subsidiaries, including for Capital Expenditures,
Investments and acquisitions permitted under this Agreement; and (d) finance
transaction costs and expenses (including fees, commissions and expenses) in
connection with the Acquisition and this Agreement.

In furtherance of the foregoing, the Borrower
has requested that the Lenders provide a term loan facility, a revolving credit
facility and a swing line facility, and the Lenders have indicated their
willingness to lend and the L/C Issuer has indicated its willingness to issue
letters of credit, in each case, on the terms and subject to the conditions set
forth herein.

In consideration of the
mutual covenants and agreements herein contained, the parties hereto covenant
and agree as follows:

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

1.01         Defined Terms.  As used in this Agreement, the following
terms shall have the meanings set forth below:

“Acquired Business” has the meaning specified in the Preliminary
Statements hereof.

“Acquired Business EBITDA” means, for any period after the
consummation of the Acquisition, an
amount equal to the Acquired Business Net Income for such period plus
the following to the extent deducted in calculating such Acquired Business Net
Income: (a) consolidated interest expense of the Acquired Business Operations
for such period, (b) the

 

1

 

provision for Federal, state, local and foreign income taxes payable by the Acquired Business
Operations for such period (net of any Federal, state, local and foreign income
tax credits attributable to the Acquired Business Operations for such period)  and (c) the amount of depreciation and
amortization expense deducted in determining such Acquired Business Net Income.

“Acquired Business Net Income” shall mean, for any period after the consummation of the Acquisition,
the consolidated net income of the Acquired Business Operations (excluding
non-cash gains and losses) for such period determined in accordance with GAAP.

“Acquired Business Operations” shall
mean the Acquired Company and its Restricted Subsidiaries that are Non-Regulated Companies.

“Acquired Company” has the meaning specified in the Preliminary
Statements hereof.

“Acquisition” has the meaning specified in the Preliminary
Statements hereof.

“Acquisition Agreement” has the meaning specified in the
Preliminary Statements hereof.

“Act” has the meaning specified in Section 10.17.

“Additional Term Facility” has the meaning specified in Section
2.16(a).

“Additional Term Facility Borrowing” means a borrowing made
under an Additional Term Facility consisting of simultaneous Additional Term
Facility Loans of the same Type and, in the case of Eurodollar Rate Loans,
having the same Interest Period made by each of the Additional
Term Facility Lenders under such Additional Term Facility.

“Additional Term Facility Commitment” means, as to each
Additional Term Facility Lender, its obligation to make Additional Term
Facility Loans to the Borrower pursuant to an amendment or supplement to this
Agreement relating to an Additional Term Facility,  in the aggregate principal amount at any time
not to exceed the amount set forth in such amendment or supplement.

“Additional Term Facility Effective Date” has the meaning
specified in Section 2.16(d).

“Additional Term Facility Lender” has the meaning specified in Section
2.16(d).

“Additional Term Facility Loan” means an advance made by any
Additional Term Facility Lender under an Additional Term Facility.

“Additional Term Facility Note” means a promissory note made by
the Borrower in favor of an Additional Term Facility Lender evidencing
Additional Term Facility Loans made by such Additional Term Facility Lender
under an Additional Term Facility, in form and substance reasonably acceptable
to the Borrower and such Additional Term Facility Lender.

 

2

 

“Administrative Agent” means Bank of America in its capacity as
administrative agent under any of the Loan Documents, or any successor
administrative agent.

“Administrative Agent’s Office” means the Administrative Agent’s address
and, as appropriate, account as set forth on Schedule 10.02, 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 any 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.

“Agent Parties” has the meaning specified in Section 10.02(c).

“Aggregate Commitments” means the Commitments of all the Lenders.

“Agreement” has the meaning specified in the introductory
paragraph hereof.

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

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

“Applicable Insurance Regulatory Authority” means, when used
with respect to any Regulated Insurance Company, the insurance department or
similar administrative authority or agency located in (a) each state or
other jurisdiction in which such Regulated Insurance Company is domiciled or
(b) to the extent asserting regulatory jurisdiction over such Regulated
Insurance Company, the insurance department, authority or agency in each state
or other jurisdiction in which such Regulated Insurance Company is licensed,
and shall include any Federal or national insurance regulatory department,
authority or agency that may be created and that asserts regulatory
jurisdiction over such Regulated Insurance Company.

“Applicable Percentage” means (a) in respect of the
Term Facility at any time, the percentage (carried out to the ninth
decimal place) of the Term  Facility represented by (i) on the Closing Date or a Term Increase
Effective Date, as applicable, such Term Lender’s
Term Commitment at such time and (ii) thereafter, the principal
amount of such Term Lender’s Term Loans at such time, (b) in respect
of any Additional Term Facility at any time, the percentage (carried out to the
ninth decimal place) of such Additional Term Facility represented by (i) on the
applicable Additional Term Facility Effective Date, such Additional Term
Facility Lender’s Additional Term Facility Commitment at such time and (ii)
thereafter, the principal amount of the Additional Term Facility Loans of such
Additional Term Facility Lender at such time, and (c) in respect of the Revolving Credit Facility,
with respect to any Revolving Credit Lender at any time, the percentage
(carried out to the ninth decimal place) of the Revolving Credit Facility
represented by such Revolving Credit Lender’s Revolving Credit Commitment at
such time.  If the commitment of
each Revolving Credit Lender to
make Revolving Credit Loans

 

3

 

and
the obligation of the L/C Issuer to make L/C Credit Extensions have been
terminated pursuant to Section 8.02, or if the Revolving Credit Commitments have expired, then the Applicable Percentage
of each Revolving Credit Lender
in respect of the Revolving Credit Facility
shall be determined based on the Applicable Percentage of such Revolving Credit Lender in respect of the Revolving Credit  Facility most recently in effect,
giving effect to any subsequent assignments. 
The initial Applicable Percentage of each Lender in respect of each
Facility is set forth opposite the name of such Lender on Schedule 2.01,
in the Assignment and Assumption pursuant to which such Lender becomes a party
hereto or in an amendment or supplement to this Agreement relating to an
Additional Term Facility, as applicable.

“Applicable Rate” means, on any date of determination, the rate
per annum set forth in the table below for the Type of Borrowing or Commitment
Fee (as the case may be), that corresponds to the Consolidated Leverage Ratio
of the Borrower at such date of determination, as calculated based on the
Compliance Certificate of the Borrower most recently delivered pursuant to Section 6.02(b)
(or initially determined based on the Compliance Certificate delivered pursuant
to Section 4.01(a)):

 

	
  Level

  	
   

  	
  Consolidated

  Leverage Ratio

  	
   

  	
  Eurodollar Rate

  +

  Letters of Credit

  	
   

  	
  Base Rate

  +

  	
   

  	
  Commitment

  Fee Rate

  	
   

  
	
  1

  	
   

  	
  > 2.00:1.00

  	
   

  	
  .875%

  	
   

  	
  0%

  	
   

  	
  .150%

  	
   

  
	
  2

  	
   

  	
  < 2.00:1.00 and >
  1.25:1.00

  	
   

  	
  .750%

  	
   

  	
  0%

  	
   

  	
  .125%

  	
   

  
	
  3

  	
   

  	
  < 1.25:1.00

  	
   

  	
  .625%

  	
   

  	
  0%

  	
   

  	
  .100%

  	
   

  

 

provided that if, on
the Closing Date, a Rating Condition exists, the Applicable Rate for the
Eurodollar Rate will be increased by 0.125% at each Level until (but only
until) a Rating Condition no longer exists; provided, further,
that, subject to the next following proviso and the proviso in the following
sentence, Level 2 shall apply until the first Business Day following the
delivery by the Borrower to the Administrative Agent of a Compliance
Certificate for the fiscal quarter ending September 30, 2007; and provided,
further, that the Applicable Rate may be adjusted as provided in Sections 2.14(f),
2.15(f) and 2.16(e).  Each
adjustment after the Closing Date in the Applicable Rate based on the above
pricing grid will become effective on the first Business Day following the
delivery by the Borrower to the Administrative Agent of a Compliance
Certificate for a particular fiscal period; provided, however,
that if a Compliance Certificate is not delivered when due in accordance with Section
6.02(b), then Level 1 shall apply as of the first Business Day after the
date on which such Compliance Certificate was required to have been delivered.

 

4

 

“Applicable Revolving Credit Percentage” means with respect to
any Revolving Credit Lender at any time, such Revolving Credit Lender’s
Applicable Percentage in respect of the Revolving Credit Facility at such time.

“Appropriate
Lender” means, at any time, (a) with respect to any of the
Term  Facility, any Additional Term Facility or the Revolving Credit
Facility, a Lender that has a Commitment with respect to such Facility or holds
a Term Loan, an Additional Term Facility Loan or a Revolving Credit Loan, respectively,
at such time, (b) with respect to the Letters of Credit, (i) the L/C
Issuer and (ii) if any Letters of Credit have been issued pursuant to Section
2.03(a), the Revolving Credit Lenders and (c) with respect to the
Swing Line Sublimit, (i) the Swing Line Lender and (ii) if any Swing
Line Loans are outstanding pursuant to Section 2.04(a), the
Revolving Credit Lenders.

“Approved Fund” means any Fund that is managed by (a) a Lender,
(b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that
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 Assumption” means an assignment and assumption entered into by a
Lender and an Eligible Assignee (with the consent of any party whose consent is
required by Section 10.06(b)), and accepted by the Administrative Agent,
in substantially the form of Exhibit E or any other form approved by the
Administrative Agent.

“Attributable
Indebtedness” means, on any date, (a) in respect of any Capitalized
Lease of any Person, the capitalized amount thereof that would appear on a
balance sheet of such Person prepared as of such date in accordance with GAAP,
(b) in respect of any Synthetic Lease Obligation, the capitalized amount of the
remaining lease or similar payments under the relevant lease or other
applicable agreement or instrument that would appear on a balance sheet of such
Person prepared as of such date in accordance with GAAP if such lease or other
agreement or instrument were accounted for as a Capitalized Lease and (c) all
Synthetic Debt of such Person.

“Audited
Financial Statements” means the audited consolidated balance sheets
of the Borrower  and its Subsidiaries for the fiscal
years ended December 31, 2004, December
31, 2005 and December 31, 2006, and the related consolidated statements
of income or operations, shareholders’ equity and cash flows for such fiscal
years of the Borrower  and its Subsidiaries, including the
notes thereto.

“Auto-Extension
Letter of Credit” has the meaning specified in Section 2.03(b).

“Availability
Period” means, in respect of the Revolving Credit Facility, the
period from and including the Closing Date to the earliest of (a) the Maturity
Date for the Revolving Credit Facility, (b) the date of termination of the
Revolving Credit Commitments pursuant to Section 2.06, and (c) the date
of termination of the respective Revolving Credit Lenders’ commitments to

 

5

 

make
Revolving Credit Loans and of the obligation of the L/C Issuer to make L/C
Credit Extensions pursuant to Section 8.02.

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

“Base
Rate” means for any day a fluctuating rate per annum equal to the
higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of
interest in effect for such day as publicly announced from time to time by Bank
of America as its “prime rate.”  The “prime
rate” is a rate set by Bank of America based upon various factors including
Bank of America’s costs and desired return, general economic conditions and
other factors, and is used as a reference point for pricing some loans, which
may be priced at, above, or below such announced rate.  Any change in such rate announced by Bank of
America shall take effect at the opening of business on the day specified in
the public announcement of such change.

“Base
Rate Loan” means a Revolving
Credit Loan, a Term Loan, or an Additional Term Loan  that bears interest based on the Base Rate.

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

“Borrower
Materials” has the meaning specified in Section 6.02.

“Borrowing”
means a Revolving Credit Borrowing, a Swing Line Borrowing, a Term Borrowing or
an Additional Term Facility Borrowing, as the context may require.

“Business
Day” means any day other than a Saturday, Sunday or other day on
which commercial banks are authorized to close under the Laws of, or are in
fact closed in, the state where the Administrative Agent’s Office is located
and, if such day relates to any Eurodollar Rate Loan, means any such day on
which dealings in Dollar deposits are conducted by and between banks in the
London interbank eurodollar market.

“Capital
Expenditures” means, with respect to any Person for any period, any
expenditure in respect of the purchase, lease (pursuant to a Capitalized Lease)
or other acquisition of, or addition to, any fixed or capital equipment or
other asset (including capitalized replacements, repairs and improvements but
excluding normal replacements and maintenance which are properly charged to
current operations).

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

“Capitalized
Leases” means all leases that have been or should be, in accordance with
GAAP, recorded as capitalized leases.

“Cash
Collateralize” has the meaning specified in Section 2.03(g).

“Cash
Equivalents” means cash and any of the following types of Investments, in
each case to the extent owned by the Borrower or any of its Restricted
Subsidiaries free and clear of all Liens:

 

6

 

(a)           obligations
issued or directly and fully guaranteed or insured by the United States of
America or any agency or instrumentality thereof having maturities of not more
than 360 days from the date of acquisition thereof; provided that the full faith and credit of the United States
of America is pledged in support thereof;

(b)           time
deposits with, or insured certificates of deposit or bankers’ acceptances of,
any commercial bank that (i) (A) is a Lender or (B) is organized under the laws
of the United States of America, any state thereof or the District of Columbia
or is the principal banking subsidiary of a bank holding company organized
under the laws of the United States of America, any state thereof or the
District of Columbia, and is a member of the Federal Reserve System, (ii)
issues (or the parent of which issues) commercial paper rated as described in
clause (c) of this definition and (iii) has combined capital and surplus
of at least $500,000,000, in each case with maturities of not more than 180 days from the date of acquisition
thereof;

(c)           commercial
paper issued by any Person organized under the laws of any state of the United
States of America and rated at least “Prime-1” (or the then equivalent
grade) by Moody’s or at least “A-2” (or the then equivalent grade) by
S&P, in each case with maturities of not more than 270 days from the date
of acquisition thereof;

(d)           Investments,
classified in accordance with GAAP as current assets of the Borrower or any of
its Restricted Subsidiaries, in money market investment programs registered
under the Investment Company Act of 1940, which are administered by financial
institutions that have the highest rating obtainable from either Moody’s or
S&P, and the portfolios of which are limited solely to Investments of the
character, quality and maturity described in clauses (a), (b) and
(c) of this definition;

(e)           repurchase
obligations of any Lender or of any commercial bank satisfying the requirements
of clause (b) of this definition, having a term of not more than 30 days, with
respect to securities issued or fully guaranteed or insured by the United
States of America or any agency or instrumentality thereof;

(f)            securities
with maturities of one year or less from the date of acquisition issued or
fully guaranteed by any state, commonwealth or territory of the United States
of America (including any auction rate security resetting not more than one
year from the prior reset date), by any political subdivision or taxing
authority of any such state, commonwealth or territory or by any foreign
government, the securities of which state, commonwealth, territory, political
subdivision, taxing authority or foreign government (as the case may be) are
rated at least A by S&P or A2 by Moody’s;

(g)           securities
with maturities of one year or less from the date of acquisition backed by
standby letters of credit issued by any Lender or any commercial bank
satisfying the requirements of clause (b) of this definition;

(h)           shares
of money market mutual or similar funds which invest exclusively in assets
satisfying the requirements of any of clauses (a) through (g) of this
definition;

 

7

 

(i)            demand
and savings deposit accounts maintained in the ordinary course of business; and

(j)            money
market funds that (i) purport to comply generally with the criteria set forth
in SEC Rule 2a 7 under the Investment Company Act of 1940, as amended,
(ii) are rated AAA by S&P, Aaa by Moody’s or an equivalent rating by
another nationally recognized rating agency, and (iii) have portfolio assets of
at least $5,000,000,000.

“CFC” means a Person that is a controlled foreign corporation
under Section 957 of the Code.

“Change in Law” means the occurrence, after the date of this
Agreement, of any of the following: (a) the adoption or taking effect of any
law, rule, regulation or treaty, (b) any change in any law, rule, regulation or
treaty or in the administration, interpretation or application thereof by any
Governmental Authority or (c) the making or issuance of any request, guideline
or directive (whether or not having the force of law) by any Governmental
Authority.

“Change
of
Control” means an event or series of events by which:

(a)           the
Investors collectively cease to own directly or indirectly an amount of the
economic and voting interest in the Borrower’s Equity Interests equal to at
least 35% of the aggregate amount of such economic and voting interest on a
fully diluted basis; or

(b)           any
“person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, but excluding any employee benefit plan of
such person or its subsidiaries, and any person or entity acting in its
capacity as trustee, agent or other fiduciary or administrator of any such
plan), other than the Investors, becomes the “beneficial owner” (as defined in
Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, except that a
person or group shall be deemed to have “beneficial ownership” of all
securities that such person or group has the right to acquire, whether such
right is exercisable immediately or only after the passage of time (such right,
an “option
right”)), directly or indirectly, of 35% or more of the Equity Interests of the Borrower entitled to vote for members of the board of
directors of the  Borrower on a fully-diluted basis (and
taking into account all such securities that such “person” or “group” has the
right to acquire pursuant to any option right); or

(c)           a
majority of the board of directors of the Borrower ceases to consist of
Continuing Directors.

“Closing
Date” means the first date all the conditions precedent in Section
4.01 are satisfied or waived in accordance with Section 10.01 and
the initial Loans are made hereunder.

“Code”
means the Internal Revenue Code of 1986.

“Collateral”
means all of the property that is or is intended under the terms of this
Agreement (including Section 6.12) and the Collateral Documents to be
subject to Liens in favor of the Administrative Agent for the benefit of the
Secured Parties; provided that the Collateral shall not include
(a) Equity Interests of any Person that is not a Wholly-Owned Restricted

 

8

 

Subsidiary,
(b) Equity Interests of an Immaterial Subsidiary, (c) Equity
Interests owned by a Regulated Insurance Company, (d) Equity Interests of
any statutory trust created for the purpose of issuing any Trust Preferred
Securities, (e) more than 65% of the Equity Interests of any CFC or any of
the Equity Interests of any CFC that are not owned by the Borrower or a
Domestic Subsidiary or (f) Equity Interests with respect to which, in the
reasonable judgment of the Administrative Agent (confirmed in writing by notice
to the Borrower), the cost or other consequence (including any adverse tax
consequences) of creating a Lien in favor of the Administrative Agent for the
benefit of the Secured Parties, would be excessive in view of the benefits to
be obtained by the Secured Parties therefrom.

“Collateral
Documents” means, collectively, the Pledge Agreement delivered to
the Administrative Agent pursuant to Section 4.01(a)(iii), and each
of the other agreements, instruments or documents that creates or purports to
create a Lien in favor of the Administrative Agent for the benefit of the
Secured Parties.  The Collateral
Documents shall be effective at all times that a Rating Condition exists.

“Commitment”
means a Term Commitment, an Additional Term Facility Commitment or a
Revolving Credit Commitment, as the context may require.

“Commitment Letter” means that certain letter agreement dated as
of May 7, 2007 among the Borrower, the Arranger and the Administrative Agent
relating to the transactions contemplated by this Agreement.

“Committed Loan Notice” means a notice of (a) a Term Borrowing, (b) an
Additional Term Facility Borrowing, (c) a Revolving Credit Borrowing, (d) a
conversion of Loans from one Type to the other, or (e) a continuation of
Eurodollar Rate Loans, pursuant to Section 2.02(a), which, if in
writing, shall be substantially in the form of Exhibit A or other form
acceptable to the Administrative Agent.

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

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

“Consolidated Adjusted EBITDA” means, for any period, for the
Borrower and its Restricted Subsidiaries on a consolidated basis, an amount
equal to the Consolidated Net Income for such period (a) plus the sum
(without duplication) of the following to the extent deducted in calculating
such Consolidated Net Income (but whether or not so deducted in the case of
clause (vii) below): (i) consolidated interest expense (including without
limitation that portion attributable to Capitalized Leases in accordance with
GAAP and capitalized interest, and all charges owed with respect to letters of
credit and net costs under Swap Contracts) for such period, (ii) the
provision for Federal, state, local and foreign income taxes payable by the
Borrower and its Restricted Subsidiaries for such period,
(iii) depreciation and amortization (including without limitation
amortization of acquired and other intangibles) expense, (iv) other
non-recurring expenses of the Borrower and its Restricted Subsidiaries reducing
such Consolidated Net Income, (v) other non-cash items reducing such
Consolidated Net Income,

 

9

 

including,
but not limited to, stock based compensation costs in accordance with FAS 123R,
(vi) costs and expenses incurred in respect of the Transactions, (vii)
Specified Equity Contributions, provided, however, that Specified
Equity Contributions will be included in the calculation of Consolidated
Adjusted EBITDA solely for the purpose of determining compliance with Section
7.11(b) and not for any other purposes, including for the purpose of
determining the Applicable Rate; provided, further, that (A) in
each four fiscal quarter period ending after the Closing Date, there shall be
at least two fiscal quarters in which no Specified Equity Contribution is
included in determining Consolidated Adjusted EBITDA, and (B) the amount of any
Specified Equity Contribution included in determining Consolidated Adjusted
EBITDA shall be no greater than the amount required to cause the Borrower to be
in compliance with Section 7.11(b), (viii) dividends on preferred Equity
Interests, (ix) non-recurring start-up expenses associated with the enactment
of the “Part D program” by the Acquired Business, including, without
limitation, integration expenses, (x) non-recurring reinsurance expenses paid
to Hannover Life Re in connection with the termination of a reinsurance
contract between the Acquired Business and Hannover Life Re in effect prior to
the date of this Agreement, (xi) fees and expenses incurred in connection with
any Disposition, incurrence of Consolidated Funded Indebtedness or offering of
Equity Interests permitted under the Loan Documents, (xii) any severance or
similar one-time compensation charges, and (xiii) the amount of any “earn-out
payments” paid or payable under the Acquisition Agreement, and (b) minus the
sum (without duplication) of the following to the extent included in
calculating such Consolidated Net Income: (i) Federal, state, local and
foreign income tax credits of the Borrower and its Restricted Subsidiaries for
such period and (ii) all non-cash items increasing Consolidated Net Income for
such period (other than to the extent representing the reversal of an accrual
or reserve for a potential cash item in a prior period); provided that,
in determining Consolidated Adjusted EBITDA, acquisitions and Dispositions of
stock or assets permitted by the Loan Documents shall be given pro forma effect
as if such acquisitions or Dispositions had occurred on the first day of such
period; provided, further, that the aggregate amount of the
expenses, fees, costs or charges set forth in subclauses (iv), (ix), (x)
and (xii) of clause (a) above that may be included in calculating
Consolidated Adjusted EBITDA may not exceed (A) 25% of Consolidated Adjusted
EBITDA during the first four full fiscal quarters following the Closing Date,
(B) 20% of Consolidated Adjusted EBITDA during the four fiscal quarters
following those referenced in the preceding clause (A), (C) 15% of Consolidated
Adjusted EBITDA during the four fiscal quarters following those referenced in
the preceding clause (B), (D) 10% of Consolidated Adjusted EBITDA during the
four fiscal quarters following those referenced in the preceding clause (C), or
(E) 5% of Consolidated Adjusted EBITDA during any period of four full fiscal
quarters ending thereafter; and provided, further, that the
expenses set forth in subclause (x) of clause (a) above may be included in
calculating Consolidated Adjusted EBITDA in an unlimited amount to the extent
that such expenses are paid or accrued on or before the Closing Date.

“Consolidated Funded Indebtedness” means, as of any date of determination, for the Borrower and its
Restricted Subsidiaries on a consolidated basis, the sum (without duplication)
of (a) the outstanding principal amount of all obligations, whether current or
long-term, for borrowed money (including obligations in respect of Trust
Preferred Securities) and all obligations evidenced by bonds, debentures,
notes, loan agreements or other similar instruments, (b) all purchase money
Indebtedness (if non-recourse, limited in each case to the fair market value of
the asset in question), (c) all direct, non-contingent obligations arising
from draws under letters of credit (including standby and commercial), bankers’
acceptances, bank guaranties,

 

10

 

surety bonds and similar instruments for which the
Borrower or any Restricted Subsidiary is the account party, (d) all
non-contingent obligations, including any non-contingent “earn-out” payment
obligations under acquisition agreements, in respect of the deferred purchase
price of property or services (other than trade accounts payable in the
ordinary course of business), (e) Attributable Indebtedness in respect of
Capitalized Leases, (f) without duplication, all Guarantees with respect
to outstanding indebtedness of the types specified in clauses (a) through (e)
above of Persons other than the Borrower or any Restricted Subsidiary, and
(g) all Indebtedness of the types referred to in clauses (a) through (f)
above of any partnership or joint venture (other than a joint venture that is
itself a corporation or limited liability company) to the extent that the
Borrower or a Restricted Subsidiary is personally liable therefore under
contract or by operation of law, minus unrestricted Cash Equivalents of
the Borrower and its Restricted Subsidiaries on a consolidated basis.  Notwithstanding the foregoing, any “earn-out”
payment obligations under the Acquisition Agreement, and any Qualified Equity
Interests issued in connection with the Transactions will not be considered to
be Consolidated Funded Indebtedness.

“Consolidated Leverage Ratio” means, as of any date of
determination, the ratio of (a) Consolidated Funded Indebtedness as of such
date to (b) Consolidated Adjusted EBITDA for the period of the four fiscal
quarters most recently ended.

“Consolidated Net Income” means, for any period, for the
Borrower and its Restricted Subsidiaries on a consolidated basis, the net
income of the Borrower and its Restricted Subsidiaries (excluding extraordinary
gains and extraordinary losses) for that period, determined in accordance with
GAAP.

“Consolidated Total Assets” means, as of any date of
determination, the consolidated total assets of the Borrower and its Restricted
Subsidiaries, as set forth in the most recent consolidated balance sheet
delivered pursuant to Section 6.01(a)(i) or 6.01(b)(i) (or, prior
to any such delivery, the proforma balance sheet referred to in Section
5.05(f)), determined in accordance with GAAP.

“Continuing Directors” shall mean the directors of the Borrower
on the Closing Date and each other director if such director’s appointment,
nomination for election or election to the board of directors of the Borrower
is recommended or approved by a majority of the then Continuing Directors.

“Contractual Obligation” means, as to any Person, any provision of any
securities 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.

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

 

11

 

“Debtor Relief Laws” means the Bankruptcy Code of the United
States, and all other liquidation, conservatorship, rehabilitation, bankruptcy,
assignment for the benefit of creditors, moratorium, rearrangement,
receivership, insolvency, reorganization, or similar debtor relief Laws of the
United States or other applicable jurisdictions from time to time in effect and
affecting the rights of creditors generally or creditors of insurance companies
in particular.

“Default” means any event or condition that constitutes an Event
of Default or that, with the giving of any notice, the passage of time, or
both, would be an Event of Default.

“Default Rate” means (a) when used with respect to Obligations other
than Letter of Credit Fees, an interest rate equal to (i) the Base Rate plus
(ii) 2% per annum; provided, however, that with respect to a Eurodollar
Rate 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 and (b) when used with respect to Letter of Credit Fees, a rate
equal to the Applicable Rate for Letters of Credit plus 2% per annum.

“Defaulting Lender” means any Lender that (a) has failed to fund any
portion of the Term Loans, Additional Term Facility Loans, Revolving Credit
Loans, participations in L/C Obligations or participations in Swing Line Loans
required to be funded by it hereunder within one Business Day of the date
required to be funded by it hereunder, (b) has otherwise failed to pay over to
the Administrative Agent or any other Lender any other amount required to be
paid by it hereunder within one Business Day of the date when due, unless the
subject of a good faith dispute, or (c) has been deemed insolvent or become the
subject of a bankruptcy or insolvency proceeding.

“Disposition” or “Dispose” means the sale, transfer, license,
lease or other disposition (including any sale and leaseback transaction, but
excluding the creation or incurrence of a Lien) of any property by any Person
(or the granting of any option or other right to do any of the foregoing),
including any sale, assignment, transfer or other disposal, with or without
recourse, of any notes or accounts receivable or any rights and claims
associated therewith; provided that a license or lease (other than a
lease that is part of a sale and leaseback transaction) shall not be deemed to
be a Disposition for purposes of Section 2.05(b)(ii).

“Disqualified Equity Interests” means any Equity Interest,
which, by its terms (or by the terms of any security or other Equity Interests
into which it is convertible or for which it is exchangeable), or upon the
happening of any event or condition (a) matures or is mandatorily redeemable on
a date that is less than 20 years after the Closing Date (other than solely for
Qualified Equity Interests), pursuant to a sinking fund obligation or otherwise
(except as a result of a change of control, asset sale or any other event so
long as any rights of the holders thereof upon the occurrence of such change of
control, asset sale or other event shall be subject to the prior repayment in full
of the Loans and all other Obligations that are accrued and payable and the
termination of the Commitments), (b) is redeemable at the option of the holder
thereof (other than solely for Qualified Equity Interests), in whole or in
part, on a date that is less than 20 years after the Closing Date, (c) provides
for the scheduled payments of dividends in cash or (d) is or becomes
convertible into or exchangeable for Indebtedness or any other Equity Interests
that would constitute Disqualified Equity Interests.

 

12

 

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

“Domestic Subsidiary” means any Subsidiary that is organized under
the laws of any political subdivision of the United States.

“Eligible Assignee” means any Person that meets the requirements to
be an assignee under Section 10.06(b)(iii), (v) and (vi)
(subject to such consents, if any, as may be required under Section
10.06(b)(iii)).

“Environmental Laws” means any and all applicable Federal, state, local,
and foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
governmental restrictions relating to pollution and the protection of the
environment or the release of any Hazardous Materials into the environment,
including those related to hazardous substances or wastes, air emissions and
discharges to waste or public systems.

“Environmental Liability” means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation,
fines, penalties or indemnities), of the Borrower, any other Loan Party or any
of their respective Subsidiaries 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.

“Environmental Permit” means any
permit, approval, identification number, license or other authorization
required under any Environmental Law.

“Equity Interests” means, with respect to any Person, all of the
shares of capital stock of (or other rights to receive a share of the profits
or losses of or distributions of property from) such Person, all of the
warrants, options or other rights for the purchase or acquisition from such
Person of shares of capital stock of (or other rights to receive a share of the
profits or losses of or distributions of property from) such Person, all of the
securities convertible into or exchangeable for shares of capital stock of (or
other ownership or profit interests in) such Person or warrants, rights or
options for the purchase or acquisition from such Person of such shares (or
such other interests), and all of the other ownership or profit interests in
such Person (including partnership, member or trust interests therein), whether
voting or nonvoting.

“ERISA” means the Employee Retirement Income Security Act of
1974.

“ERISA Affiliate” means any trade or business (whether or not
incorporated) under common control with the Borrower within the meaning of
Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for
purposes of provisions relating to Section 412 of the Code).

“ERISA Event” means (a) a Reportable Event with respect to a
Pension Plan; (b) a withdrawal by the Borrower or any ERISA Affiliate from
a Pension Plan subject to Section 4063 of ERISA during a plan year in
which it was a substantial employer (as defined

 

13

 

in
Section 4001(a)(2) of ERISA) or a cessation of operations that is treated
as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial
withdrawal by the Borrower or any ERISA Affiliate from a Multiemployer Plan or
notification that a Multiemployer Plan is in reorganization; (d) the filing of
a notice of intent to terminate a Pension Plan or Multiemployer Plan, the
treatment of a Pension Plan or Multiemployer Plan amendment as a termination
under Section 4041 or 4041A of ERISA, or the commencement of proceedings by the
PBGC to terminate a Pension Plan or Multiemployer Plan; (e) an event or
condition which constitutes grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Pension Plan
or Multiemployer Plan; or (f) the imposition of any liability under Title IV of
ERISA, other than for PBGC premiums due but not delinquent under Section 4007
of ERISA, upon the Borrower or any ERISA Affiliate.

“Escrow Documents” means the escrow agreement described in Section
4.01(d) and the related side agreement entered into in connection
therewith, each dated as of the Closing Date.

“Eurodollar Rate” means for any Interest Period with respect to
a Eurodollar Rate Loan, 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 in its reasonable discretion 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 “Eurodollar Rate” for such Interest Period
shall be the rate per annum determined by the Administrative Agent in its
reasonable discretion 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 Rate 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.

“Eurodollar Rate Loan” means a Revolving Credit Loan, a
Term Loan or an Additional Term Facility Loan that bears interest at a
rate based on the Eurodollar Rate.

“Event of Default” has the meaning specified in Section 8.01.

“Excepted Disposition” means any Disposition of any property
described in (i) Sections 7.05 (b), (c), (d), (e), (f),
(g), (h), (k), (l), or (n) or (ii) Section
7.05(m); provided that any Disposition permitted under Section
7.04(d) pursuant to Section 7.05(m) shall only be deemed to be an “Excepted
Disposition” to the extent that the Disposition is otherwise described in one
of the subsections referred to in clause (i) of this definition.

“Excess Cash Flow” means, for any Excess Cash Flow Period, an
amount equal to the excess of: (a) the sum (without duplication) of
(i) the greater of (A) aggregate amount of dividends which the Regulated
Insurance Companies (other than SelectCare but only so long as SelectCare is
not a wholly-owned direct or indirect Subsidiary of the Borrower) could pay
directly to the Borrower or American Exchange under applicable Laws during such
Excess Cash

 

14

 

Flow
Period (without obtaining extraordinary dividend approval from any Applicable
Insurance Regulatory Authority), while still maintaining a Risk Based Capital
Ratio for each such Regulated Insurance Company of 525% and (B) the aggregate
amount of dividends actually paid by the Regulated Insurance Companies (other
than SelectCare but only so long as SelectCare is not a wholly-owned direct or
indirect Subsidiary of the Borrower) directly to the Borrower or American
Exchange during such Excess Cash Flow Period, plus (ii) whether positive or
negative, tax sharing payments made by the Regulated Insurance Companies to the
Borrower or American Exchange during such Excess Cash Flow Period, plus (iii) the
combined interest income of the Borrower and American Exchange on an
unconsolidated basis during such Excess Cash Flow Period, plus (iv) the TPA
EBITDA for such Excess Cash Flow Period, plus (v) the Heritage EBITDA for such
Excess Cash Flow Period, plus (vi) after the consummation of the Acquisition,
the Acquired Business EBITDA for such Excess Cash Flow Period, provided that
the Acquired Business is not then contained in one of the Regulated Insurance
Companies minus (b) the sum (without duplication), for the Borrower and
its Restricted Subsidiaries (unless otherwise expressly provided), of
(i) consolidated interest expense with respect to Consolidated Funded
Indebtedness (including, without limitation, that portion attributable to
Capitalized Leases in accordance with GAAP and capitalized interest, all
charges owed with respect to letters of credit and net costs under Swap
Contracts, and interest expense on Trust Preferred Securities) for such Excess
Cash Flow Period and principal repayments on Consolidated Funded Indebtedness
(other than Indebtedness of the Borrower or any of its Subsidiaries to the
Borrower or any of its Subsidiaries) during such Excess Cash Flow Period, (ii)
the aggregate amount of capital contributions which the Regulated Insurance Companies
(other than SelectCare but only so long as SelectCare is not a wholly-owned
direct or indirect Subsidiary of the Borrower) would require from the Borrower
or American Exchange to maintain a Risk Based Capital Ratio for each such
Regulated Insurance Company of 525% at the end of such Excess Cash Flow Period,
(iii) the combined cash selling, general and administrative expenses of the
Borrower and American Exchange on an unconsolidated basis during such Excess
Cash Flow Period, (iv) cash taxes paid by the Borrower or any Non-Regulated
Company during such Excess Cash Flow Period, (v) all voluntary prepayments of
Loans under the Term Facility or any Additional Term Facility during such
Excess Cash Flow Period, (vi) all mandatory prepayments of Loans made under the
Term Facility or any Additional Term Facility during such Excess Cash Flow
Period, (vii) the amount of Capital Expenditures made in cash or accrued during
such Excess Cash Flow Period, (viii) the aggregate amount of any premium,
make-whole or penalty payments actually paid in cash during such Excess Cash
Flow Period that are required to be made in connection with any prepayment of
Consolidated Funded Indebtedness, and (ix) the amount of any “earn-out”
payments paid or payable under the Acquisition Agreement during such Excess
Cash Flow Period.

“Excess Cash Flow Period” means the first full fiscal year of
the Borrower ending after the Closing Date and each subsequent full fiscal
year, as applicable.

“Excess Cash Flow Prepayment Percentage” means, on any date of
determination, the percentage set forth below that corresponds to the
Consolidated Leverage Ratio of the Borrower at such date of determination,
which for purposes of this definition, shall be calculated based on the
Compliance Certificate of the Borrower for the applicable Excess Cash Flow
Period delivered in connection with the delivery of financial statements
pursuant to Section 6.01(a)(i):

 

15

 

	
  Consolidated

  Leverage Ratio

  	
   

  	
  Excess Cash Flow Prepayment Percentage

  	
   

  
	
  > 2.50:1.00

  	
   

  	
  50%

  	
   

  
	
  < 2.50:1.00 and > 1.75:1.00

  	
   

  	
  25%

  	
   

  
	
  < 1.75:1.00

  	
   

  	
  0%

  	
   

  

 

“Excluded Subsidiary” means (a) any Regulated Insurance Company,
(b) any Subsidiary that is not a Wholly-Owned Subsidiary, (c) any Immaterial
Subsidiary, (d) any Subsidiary that is prohibited by applicable Law from
guaranteeing the Obligations, (e) any statutory trust created for the purpose
of issuing any Trust Preferred Securities, (f) any CFC, and (g) any other
Subsidiary with respect to which, in the reasonable judgment of the
Administrative Agent (confirmed in writing by notice to the Borrower), the cost
or other consequences (including any adverse tax consequences) of providing or
joining in a Guaranty would be excessive in view of the benefits to be obtained
by the Lenders therefrom.

“Excluded Taxes” means, with respect to the Administrative
Agent, any Lender, the L/C Issuer or any other recipient of any payment to be
made by or on account of any obligation of the Borrower hereunder, (a) taxes
imposed on or measured by its overall net income (however denominated), and
franchise taxes imposed on it (in lieu of net income taxes), by the
jurisdiction (or any political subdivision thereof) under the laws of which
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 branch profits taxes imposed by the United States or any similar tax
imposed by any other jurisdiction in which the Borrower is located and (c) in the
case of any Lender (other than an assignee pursuant to a request by the
Borrower under Section 10.13), any withholding tax that is imposed on
amounts payable to such Lender at the time such Lender becomes a party hereto
(or designates a new Lending Office) or is attributable to such Lender’s
failure or inability (other than as a result of a Change in Law) to comply with
Section 3.01(e) so as to establish its exemption from, or reduction of,
withholding tax, except to the extent that such Lender (or its assignor, if
any) was entitled, at the time of designation of a new Lending Office (or
assignment), to receive additional amounts from the Borrower with respect to
such withholding tax pursuant to Section 3.01(a).

“Existing
Credit Agreements” means (a) that certain Amended and Restated
Credit Agreement dated as of May 28, 2004, as amended or modified prior to the
Closing Date, among the Borrower, Bank of America, N.A., as administrative
agent, and a syndicate of lenders, (b) that certain Credit Agreement dated as
of January 18, 2007, as amended or modified prior to the Closing Date, between
the Borrower and Bank of America, N.A., as the lender and (c) that certain
Second Amended and Restated Loan and Security Agreement dated as of
December 27,

 

16

 

2006, as amended or modified prior to  the Closing Date, among the Acquired Company,
the lenders party thereto and The Huntington National Bank, as agent.

“Existing
Letters of Credit” means the Letters of Credit listed on Schedule
1.01A.

“Facility” means the
Term Facility, any Additional Term Facility or the Revolving Credit
Facility, as the context may require.

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

“Fee
Letter” means the letter agreement dated May 7, 2007, among the
Borrower, the Administrative Agent and the Arranger relating to certain fees
payable in connection with the transactions contemplated by this Agreement.

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

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

“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 set forth
in the opinions and pronouncements of the Accounting Principles Board and the
American Institute of Certified Public Accountants, statements and
pronouncements of the Financial Accounting Standards Board, the Public Company
Accounting Oversight Board or the SEC or such other principles as may be
approved by a significant segment of the accounting profession in the United
States, that are applicable to the circumstances as of the date of
determination, consistently applied.

“Governmental
Authority” means the government of the United States or any other
nation, or of any political subdivision thereof, whether state or local, and
any agency, authority, instrumentality, regulatory body, court, central bank or
other entity exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to

 

17

 

government
(including any Applicable Insurance Regulatory Authority and any supra-national
bodies such as the European Union or the European Central Bank).

“Guarantee”
means, as to any Person, any (a) any obligation, contingent or otherwise, of
such Person guaranteeing any Indebtedness or other obligation payable or
performable by another Person (the “primary obligor”) in any manner, whether
directly or indirectly, and including any obligation of such Person, direct or
indirect, (i) to purchase or pay (or advance or supply funds for the purchase
or payment of) such Indebtedness or other obligation, (ii) to purchase or lease
property, securities or services for the purpose of guaranteeing the payment or
performance of such Indebtedness or other obligation, (iii) to maintain working
capital, equity capital or any other financial statement condition or liquidity
or level of income or cash flow of the primary obligor so as to enable the
primary obligor to pay such Indebtedness or other obligation, or (iv) entered
into for the purpose of assuring in any other manner the obligee in respect of
such Indebtedness or other obligation of the payment or performance thereof or
to protect such obligee against loss in respect thereof (in whole or in part),
or (b) any Lien on any assets of such Person securing any Indebtedness or other
obligation of any other Person, whether or not such Indebtedness or other
obligation is assumed by such Person (or any right, contingent or otherwise, of
any holder of such Indebtedness to obtain any such Lien); provided that
the term “Guarantee” shall not include endorsements of instruments for
deposit or collection in the ordinary course of business or reimbursement or
indemnity obligations that do not constitute Indebtedness.  The amount of any Guarantee shall be deemed
to be an amount equal to the stated or determinable amount of the related
primary obligation, or portion thereof, in respect of which such Guarantee is
made or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof as determined by the guaranteeing Person in good
faith.  The term “Guarantee”
as a verb has a corresponding meaning.

“Guarantors”
means each Restricted Subsidiary that is (a) a Domestic Subsidiary and (b) not
an Excluded Subsidiary.

“Guaranty”
means, collectively, the Subsidiary Guaranty Agreement made by the Guarantors in favor of the Secured Parties,
substantially in the form of Exhibit F, together with each other
guaranty and guaranty supplement delivered pursuant to Section 6.12.

“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 hazardous or toxic substances or wastes of any nature regulated pursuant
to any Environmental Law.

“Heritage
EBITDA” shall mean, for any period for the Heritage Operations, an amount
equal to the Heritage Net Income for such period plus the following to
the extent deducted in calculating such Heritage Net Income:
(a) consolidated interest expense of the Heritage Operations for such
period, (b) the provision for Federal, state, local and foreign income taxes
payable by the Heritage Operations for such period (net of any Federal, state,
local and foreign income tax credits attributable to the Heritage Operations
for such period)  and (c) the amount of
depreciation and amortization expense deducted in determining such Heritage Net
Income.

 

18

 

“Heritage
Net Income” shall mean, for any period for the Heritage Operations, the
consolidated net income of the Heritage Operations (excluding non-cash gains and losses) for such period,
determined in accordance with GAAP.

“Heritage
Operations” shall mean Heritage Health Systems, Inc. and its Restricted
Subsidiaries that are Non-Regulated Companies (other than Golden Triangle
Physician Alliance and Heritage Physician Networks).

“Immaterial
Subsidiary” means each Restricted Subsidiary of the Borrower that (a) for
the most recent fiscal period for which financial statements of the Borrower
have been delivered to the Administrative Agent pursuant to Section
6.01(a)(i) or Section 6.01(b)(i) (or, prior to any such delivery,
the pro forma financial statements referred to in Section 5.05(f)), had
revenues not in excess of 5% of the consolidated revenues of the Borrower and
its Restricted Subsidiaries and (b) as of the end of such fiscal period, had
assets not in excess of 5% of Consolidated Total Assets, in each case as shown
on the financial statements of the Borrower for such fiscal period; provided
that, as of the Closing Date, each entity listed as an “Immaterial Subsidiary”
on Schedule 1.01B shall be an Immaterial Subsidiary; and provided
further, that the Immaterial Subsidiaries, collectively, shall not have
at any time (x) aggregate revenues in excess of 10% of the consolidated
revenues of the Borrower and its Restricted Subsidiaries or (y) aggregate
assets in excess of 10% of Consolidated Total Assets.

“Indebtedness”
means, as to the Borrower or any of its Restricted Subsidiaries at a particular
time, without duplication, all of the following, whether or not included as
indebtedness or liabilities in accordance with GAAP:

(a)           all
obligations of such Person for borrowed money and all obligations of such
Person evidenced by bonds, debentures, notes, loan agreements or other similar
instruments;

(b)           the
maximum amount of all direct or contingent obligations of such Person arising
under standby letters of credit, bankers’ acceptances, bank guaranties, surety
bonds and similar instruments;

(c)           net
obligations of such Person under any Swap Contract;

(d)           all
obligations of such Person to pay the deferred purchase price of property or
services (other than trade accounts, accrued expenses, current accounts and
similar current obligations payable in the ordinary course of business and not
past due for more than 90 days
after the date on which such trade account was created and other than
(i) any “earn-out” payments payable pursuant to the Acquisition Agreement
or (ii) any “earn-out” payments payable pursuant to the acquisition or
similar agreement for any other acquisition except to the extent that the
liability on account of such “earn-out” payments is fixed or non-contingent);

(e)           indebtedness
(excluding prepaid interest thereon) secured by a Lien on property owned or
being purchased by such Person (including indebtedness arising under
conditional sales or other title retention agreements), whether or not such
indebtedness shall have been assumed by such Person or is limited in recourse;

 

19

 

(f)            all
Attributable Indebtedness in respect of Capitalized Leases and Synthetic Lease
Obligations of such Person and all Synthetic Debt of such Person;

(g)           all
obligations of such Person to purchase, redeem, retire, defease or otherwise
make any payment in respect of any Equity Interest in such Person or any other
Person, valued, in the case of a redeemable preferred interest, at the greater
of its voluntary or involuntary liquidation preference plus accrued and
unpaid dividends, except for obligations to acquire such Equity Interest from
any of such Person’s directors, officers or employees or their estates upon the
termination of employment or death of such director, officer or employee;
and(h)       all Guarantees of such Person
in respect of any of the foregoing.

For all purposes hereof, the Indebtedness of any Person shall include
the Indebtedness of any partnership or joint venture (other than a joint
venture that is itself a corporation or limited liability company) to the
extent that such Person is personally liable therefor under contract or by
operation of Law.  The amount of any net
obligation under any Swap Contract on any date shall be deemed to be the Swap
Termination Value thereof as of such date. Notwithstanding the foregoing, the
term Indebtedness shall not include indebtedness that constitutes Indebtedness
solely by virtue of a pledge of Equity Interests of an Unrestricted Subsidiary.

“Indemnified
Taxes”  means Taxes other than Excluded Taxes.

“Indemnitees”
has the meaning specified in Section 10.04(b).

“Information” has the meaning specified in Section 10.07.

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

“Intellectual Property” has the meaning specified in Section
5.17.

“Interest
Payment Date” means, (a) as to any Eurodollar Rate Loan, the last
day of each Interest Period applicable to such Loan and the Maturity Date of
the Facility under which such Loan was made; provided, however,
that if any Interest Period for a Eurodollar Rate Loan exceeds three months,
the respective dates that fall every three months after the beginning of such
Interest Period shall also be Interest Payment Dates; and (b) as to any Base
Rate Loan or Swing Line Loan, the last Business Day of each March, June, September and December
and the Maturity Date of the Facility under which such Loan was made (with
Swing Line Loans being deemed made under the Revolving Credit Facility for
purposes of this definition).

“Interest
Period” means, as to each Eurodollar Rate Loan, the period
commencing on the date such Eurodollar Rate Loan is disbursed or converted to
or continued as a Eurodollar Rate Loan and ending on the date one, two, three
or six months (or, if available to the Appropriate Lenders, nine or twelve
months) thereafter, as selected by the Borrower in its Committed Loan Notice; provided
that:

 

20

 

(a)           any
Interest Period that would otherwise end on a day that is not a Business Day
shall be extended to the next succeeding Business Day unless such Business Day
falls in another calendar month, in which case such Interest Period shall end
on the next preceding Business Day;

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

(c)           no
Interest Period shall extend beyond the Maturity Date of the Facility under
which such Loan was made.

“Investment”
means, as to any Person, any direct or indirect acquisition or investment by
such Person, whether by means of (a) the purchase or other acquisition of
Equity Interests of another Person, (b) a loan, advance or capital contribution
to, Guarantee or assumption of debt of, or purchase or other acquisition of any
other debt or interest in, another Person, or (c) the purchase or other
acquisition (in one transaction or a series of transactions) of assets of
another Person that constitute a business unit or all or a substantial part of the business of, such Person.  For purposes of covenant compliance, the
amount of any Investment shall be the amount actually invested, without
adjustment for subsequent increases or decreases in the value of such
Investment.  Any “earn-out” payments
payable pursuant to the Acquisition Agreement shall not be deemed to be
Investments.

“Investors” means, collectively, Capital Z,
Welsh, Carson, Anderson & Stowe X, L.P., Perry Partners, L.P., Perry
Partners International, Inc., Perry Commitment Fund, L.P., Perry Commitment
Master Fund, L.P., Union Square Universal Partners, L.P. and Lee-Universal Holdings
LLC, and their respective Affiliates.

“IRS”
means the United States Internal Revenue Service.

“ISP” means, with respect to any Letter of Credit, the “International
Standby Practices 1998” published by the Institute of International Banking Law
& Practice, Inc. (or such later version thereof as may be in effect at the
time of issuance).

“Issuer Documents” means with respect to any Letter of Credit,
the Letter of Credit Application, and any other document, agreement and
instrument entered into by the L/C Issuer and the Borrower (or any Restricted
Subsidiary) or in favor of the L/C Issuer and relating to such Letter of
Credit.

“Laws”
means, collectively, all applicable international, foreign, Federal, state and
local governmental laws, statutes, treaties, rules, guidelines, regulations,
ordinances, orders and codes.

“L/C
Advance” means, with respect to each Revolving Credit Lender, such
Lender’s funding of its participation in any L/C Borrowing in accordance with
its Applicable Revolving Credit Percentage.

 

21

 

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

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

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

“L/C
Obligations” means, as at any date of determination, the aggregate
amount available to be drawn under all outstanding Letters of Credit plus
the aggregate of all Unreimbursed Amounts, including all L/C Borrowings.  For purposes of computing the amount
available to be drawn under any Letter of Credit, the amount of such Letter of
Credit shall be determined in accordance with Section 1.06.  For all purposes of this Agreement, if on any
date of determination a Letter of Credit has expired by its terms but any
amount may still be drawn thereunder by reason of the operation of Rule 3.14 of
the ISP, such Letter of Credit shall be deemed to be “outstanding” in the
amount so remaining available to be drawn.

“Legal
Requirements” has the meaning specified in the definition of “Material
Adverse Effect”.

“Lender”
has the meaning specified in the introductory paragraph hereof and, as the
context requires, includes the Swing Line Lender.

“Lending
Office” means, as to any Lender, the office or offices of such
Lender described as such in such Lender’s Administrative Questionnaire, or such
other office or offices as a Lender may from time to time notify the Borrower
and the Administrative Agent.

“Letter
of Credit” means any standby
letter of credit issued hereunder and
shall include the Existing Letters of Credit.

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

“Letter
of Credit Expiration Date” means the day that is seven days prior to
the Maturity Date then in effect for the Revolving Credit Facility (or, if such
day is not a Business Day, the next preceding Business Day).

“Letter of Credit Fee” has the meaning specified in Section
2.03(i).

“Letter of Credit Sublimit” means an amount equal to
$150,000,000. The Letter of Credit Sublimit is a part of, and not in addition
to, the Revolving Credit Facility.

“Lien”
means any mortgage, pledge, hypothecation, assignment, deposit arrangement,
encumbrance, lien (statutory or other), charge, or preference, priority or
other security interest or preferential arrangement in the nature of a security
interest of any kind or nature whatsoever (including any conditional sale or
other title retention agreement, any easement, right of way or

 

22

 

other
encumbrance on title to real property, and any financing lease having
substantially the same economic effect as any of the foregoing).

“Loan”
means an extension of credit by a Lender to the Borrower under Article II
in the form of a Term Loan, an Additional Term Facility Loan, a Revolving
Credit Loan or a Swing Line Loan.

“Loan
Documents” means, collectively, (a) this Agreement, (b) the
Notes, (c) the Guaranty, (d) the Collateral Documents, (e) the Fee Letter and
(f) each Issuer Document.

“Loan
Parties” means, collectively, the Borrower, the Guarantors and the Pledgors.

“Material
Adverse Effect” means (a) at all times prior to the making of
the initial Loans on the Closing Date, any fact, event, circumstance, change,
occurrence, effect or condition individually or in the aggregate which has had
or would reasonably be expected to have a material adverse effect on (A) the
combined financial condition, business or results of operations of the Borrower
and its Subsidiaries and the Acquired Business, taken as a whole, assuming
completion of the Acquisition; provided
that any change, event or effect arising from or related to, or in the case of
matters covered by clauses (ix) and (x) below, directly and solely resulting
from: (i) conditions generally affecting the industries in which the Borrower
and its Subsidiaries and the Acquired Business operate or the United States economy
generally; (ii) acts of terrorism, acts of war or the escalation of
hostilities; (iii) any disruption of the financial, banking or securities
markets (including any decline in the price of any security or any market
index); (iv) changes in GAAP; (v) changes in any domestic or foreign law,
statute, standard, ordinance, code, rule, regulation, binding directive,
resolution or promulgation, any order, writ, judgment, injunction, decree,
stipulation, ruling, determination or award entered by or with any domestic or
foreign governmental authority (including, without limitation, any state,
commonwealth, territory, possession, county, or municipality thereof or the
government of any political subdivision of any of the foregoing, or any entity,
authority, agency, ministry, court or other similar body exercising executive,
legislative, judicial, regulatory or administrative authority or functions of
or pertaining to government, including any authority or other
quasi-governmental entity established to perform any of such functions and, in
the case of the Borrower, the securities exchange on which its capital stock is
listed), or any license, franchise, permit or similar right granted under any
of the foregoing, or any similar provision having the force or effect of law
and, with respect to the Borrower, the rules of the securities exchange on
which its capital stock is listed (collectively, “Legal Requirements”),
except for changes in Legal Requirements or the Centers for Medicare &
Medicaid Services’ written interpretations and guidance related to Medicare
Part D or related to the business of providing health and life insurance or
managed care products and services; (vi) any action taken or omission by the
Borrower  in accordance with the
Commitment Letter or the Fee Letter or at the written request of, or with the
prior written consent of, the Administrative Agent; (vii) any change in or
effect on the business of the Borrower or its Subsidiaries or the Acquired
Business that is cured prior to the Closing Date; (viii) the announcement of
the Transactions; (ix) any failure, in and of itself, by the Borrower or any of
its Subsidiaries or the Acquired Business to meet any projections, forecasts or
revenue or earnings predictions for any period ending on or after the date of
the Commitment Letter; or (x) any change, in and of itself, in the market price
or trading volume of shares of the common stock of the Borrower, shall not be
taken into account in determining

 

23

 

whether
a “Material Adverse Effect” has occurred, or would reasonably be
expected to occur, except in the case of clauses (i) and (iii), to the extent
that such change, event or effect referred to therein has had a materially
disproportionate impact on the financial condition, business or results of
operations of the Borrower and its Subsidiaries and the Acquired Business,
taken as a whole, relative to other industry participants and, except in the
case of clauses (ix) and (x), any fact, event, circumstance, change,
occurrence, effect or condition underlying any failure to meet any projections,
forecasts or revenue or earnings predictions or affecting such market price or
trading volume shall be taken into account in determining whether a Material
Adverse Effect has occurred or would reasonably be expected to occur; and
(b) at all times after the making of the initial Loans made on the Closing
Date, any fact, event, circumstance, change, occurrence, effect or condition
individually or in the aggregate which has had or could reasonably be expected
to have a material adverse effect upon, (A) the operations, business,
properties, liabilities (actual or contingent) or condition (financial or
otherwise) of the Borrower or the Borrower and its Restricted Subsidiaries
taken as a whole; (B) the rights and remedies of the Administrative Agent or
any Lender under any Loan Document, or of the ability of any Loan Party to
perform its obligations under any Loan Document to which it is a party; or (C)
the legality, validity, binding effect or enforceability against any Loan Party
of any Loan Document to which it is a party.

“Maturity
Date” means (a) with respect to the Revolving Credit Facility, the
date that is the fifth anniversary of the Closing Date, (b) with respect to the
Term Facility, the date that is the fifth anniversary of the Closing Date, and
(c) with respect to any Additional Term Facility, the final maturity date
established for such Additional Term Facility in the amendment or supplement to
this Agreement entered into in connection with such Additional Term Facility; provided,
however, that, in each case, if such date is not a Business Day, the
Maturity Date shall be the next preceding Business Day.

“Maximum Rate” has the meaning specified in Section 10.09.

“Medicaid” means that government-sponsored entitlement program
under Title XIX, P.L. 89-97 of the Social Security Act, which provides federal
grants to states for medical assistance based on specific eligibility criteria,
as set forth on Section 1396, et seq. of Title 42 of the United States Code.

“Medicare” means
that government-sponsored insurance program under Title XVIII, P.L. 89-97, of
the Social Security Act, which provides for a health insurance system for
eligible elderly and disabled individuals, as set forth at Section 1395, et
seq. of Title 42 of the United States Code.

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

“Multiemployer
Plan” means any employee benefit plan of the type described in
Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate
makes or is obligated to make contributions, or during the preceding five plan
years, has made or been obligated to make contributions.

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

 

24

 

“Net
Cash Proceeds” means, with respect to any Disposition by the Borrower
or any of its Restricted Subsidiaries, the excess, if any, of
(a) the sum of cash and Cash Equivalents received in connection with such
transaction (including any cash or Cash Equivalents received by way of deferred
payment pursuant to, or by monetization of, a note receivable or otherwise, but
only as and when so received) over (b) the sum of (i) the principal amount of
any Indebtedness (including any premium or penalty) that is secured by the
applicable asset and that is required to be repaid in connection with such
transaction (other than Indebtedness under the Loan Documents), (ii) the
reasonable out-of-pocket fees and expenses, including legal fees and expenses
incurred by the Borrower  or such Restricted Subsidiary in
connection with such transaction and any escrow or reserve for any contractual
indemnification obligations undertaken by the Borrower or any of its Restricted
Subsidiaries in connection with such Disposition (provided that upon release of
any such escrow or reserve, the amount released shall be considered Net Cash
Proceeds) and (iii) income taxes reasonably estimated to be actually payable as
a result of any gain recognized in connection therewith; provided that,
if the amount of any estimated taxes pursuant to subclause (iii) exceeds the
amount of taxes actually required to be paid in cash in respect of such
Disposition, the aggregate amount of such excess shall constitute Net Cash
Proceeds.

“Non-Consenting Lender” has the meaning specified in Section
10.13.

“Non-Extension Notice Date” has the meaning specified in Section
2.03(b).

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

“Note”
means a Term Note, an Additional Term Facility Note or a Revolving Credit Note,
as the context may require.

“Novation Agreement” means the Novation Agreement having an
effective date on or about the date the Acquisition is consummated, among
MemberHealth, Inc., Pennsylvania Life Insurance Company, American Progressive
Life & Health Insurance Company of New York and the Centers for Medicare
& Medicaid Services, as it may be amended or modified.

“Obligations”
means all advances to, and debts, liabilities and obligations of, any Loan
Party arising under any Loan Document or otherwise with respect to any Loan or
Letter of Credit, whether direct or indirect (including those acquired by
assumption), absolute or contingent, due or to become due, now existing or
hereafter arising and including interest and fees that accrue after the
commencement by or against any Loan Party or any Affiliate thereof of any
proceeding under any Debtor Relief Laws naming such Person as the debtor in
such proceeding, regardless of whether such interest and fees are allowed
claims in such proceeding.

“Organization
Documents” means, (a) with respect to any corporation, the
certificate or articles of incorporation and the bylaws (or equivalent or
comparable constitutive documents with respect to any non-U.S. jurisdiction);
(b) with respect to any limited liability company, the certificate or articles
of formation or organization and operating agreement; and (c) with respect to any
partnership, joint venture, trust or other form of business entity, the
partnership, joint venture or other applicable agreement of formation or organization
and any agreement,

 

25

 

instrument,
filing or notice with respect thereto filed in connection with its formation or
organization with the applicable Governmental Authority in the jurisdiction of
its formation or organization and, if applicable, any certificate or articles
of formation or organization of such entity.

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

“Outstanding
Amount” means (a) with respect to Term Loans, Additional Term
Facility Loans, Revolving Credit Loans and Swing Line Loans on any date, the
aggregate outstanding principal amount thereof after giving effect to any
borrowings and prepayments or repayments of Term Loans, Additional Term
Facility Loans, Revolving Credit Loans and Swing Line Loans, as the case may
be, occurring on such date; and (b) with respect to any L/C Obligations on any
date, the amount of such L/C Obligations on such date after giving effect to
any L/C Credit Extension occurring on such date and any other changes in the
aggregate amount of the L/C Obligations as of such date, including as a result
of any reimbursements by the Borrower of Unreimbursed Amounts.

“Participant”
has the meaning specified in Section 10.06(d).

“PBGC”
means the Pension Benefit Guaranty Corporation.

“Pension
Plan” means any “employee pension benefit plan” (as such term is
defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by the Borrower or
any ERISA Affiliate or to which the Borrower or any ERISA Affiliate contributes
or has an obligation to contribute, or in the case of a multiple employer or
other plan described in Section 4064(a) of ERISA, has made contributions at any
time during the immediately preceding five plan years.

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

“Plan”
means any “employee benefit plan” (as such term is defined in Section 3(3)
of ERISA) established by the Borrower, including any Pension Plan, but not
including any Multiemployer Plan.

“Platform” has the meaning specified in Section 6.02.

“Pledge
Agreement” has the meaning specified in Section 4.01(a)(iii).

“Pledgor” means (a) the Borrower and (b) each Restricted
Subsidiary that is the owner of Collateral.

“Pro Forma Compliance” means, with respect to any transaction,
action, event or occurrence for which Pro Forma Compliance is required to be
determined or is a condition precedent thereto hereunder, that such
transaction, action, event or occurrence shall be deemed to

 

26

 

have
occurred as of the first day of the fiscal quarter in which such transaction,
action, event or occurrence actually occurred and that immediately after giving
effect thereto, (a) the Borrower shall be in compliance with the financial
covenant set forth in Section 7.11(b), such compliance to be determined
on the basis of the financial information most recently delivered to the
Administrative Agent and the Lenders pursuant to Section 6.01(a)(i)
or (b)(i) or otherwise on a basis reasonably acceptable to the
Administrative Agent and (b) no Event of Default otherwise exists.

“Public Lender” has the meaning specified in Section 6.02.

“Qualified Equity Interests” means any Equity Interests that are
not Disqualified Equity Interests.

“Rating Condition” means, on any date of determination, that the
Borrower (a) does not have a corporate rating of BBB- or higher by S&P or
(b) does not have a corporate rating by S&P.

“Refinancing” means the refinancing and repayment of all
outstanding obligations and liabilities (other than in respect of any undrawn
Existing Letters of Credit and contingent reimbursement or indemnity
obligations) of the Borrower or the Acquired Company under the Existing Credit
Agreements.

“Register”
has the meaning specified in Section 10.06(c).

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

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

“Reportable
Event” means any of the events set forth in Section 4043(c) of
ERISA, other than events for which the 30 day notice period has been waived.

“Request
for Credit Extension” means (a) with respect to a Borrowing,
conversion or continuation of Term Loans, Additional Term Facility Loans or
Revolving Credit Loans, a Committed Loan Notice, (b) with respect to an L/C
Credit Extension, a Letter of Credit Application, and (c) with respect to a
Swing Line Loan, a Swing Line Loan Notice.

“Required Additional Term Facility Lenders” means, as of any
date of determination for any Additional Term Facility, Additional Term
Facility Lenders holding more than 50% of such Additional Term Facility on such
date; provided that the portion of an Additional Term Facility held by a
Defaulting Lender shall be excluded for purposes of making a determination of
Required Additional Term Facility Lenders.

“Required
Lenders” means, as of any date of determination, Lenders holding more than 50% of the sum of the (a)
Total Outstandings (with the aggregate amount of each Revolving

 

27

 

Credit
Lender’s risk participation and funded participation in L/C Obligations and
Swing Line Loans being deemed “held” by such Revolving Credit Lender for
purposes of this definition) and (b) aggregate unused Term Commitments and
Revolving Credit Commitments; provided that the unused Term Commitment
or Revolving Credit Commitment of, and the portion of the Total Outstandings
held or deemed held by, any Defaulting Lender shall be excluded for purposes of
making a determination of Required Lenders.

“Required Revolving Lenders” means, as of any date of
determination, Revolving Credit Lenders holding more than 50% of the sum of the (a) Total Revolving Credit
Outstandings (with the aggregate amount of each Revolving Credit Lender’s risk
participation and funded participation in L/C Obligations and Swing Line Loans
being deemed “held” by such Revolving Credit Lender for purposes of this
definition) and (b) aggregate unused Revolving Credit Commitments; provided
that the unused Revolving Credit Commitment of, and the portion of the Total
Revolving Credit Outstandings held or deemed held by, any Defaulting Lender
shall be excluded for purposes of making a determination of Required Revolving
Lenders.

“Required Term Lenders” means, as of any date of determination,
Term Lenders holding more than 50% of
the Term Facility on such date; provided that the portion of the Term
Facility held by any Defaulting Lender shall be excluded for purposes of making
a determination of Required Term Lenders.

“Responsible
Officer” means the chief executive officer, president, chief
financial officer, treasurer, assistant treasurer or controller of a Loan Party
and any other officer or employee of
the applicable Loan Party so designated by any of the foregoing officers in a
notice to the Administrative Agent. 
Any document delivered hereunder that is signed by a Responsible Officer
of a Loan Party shall be conclusively presumed to have been authorized by all
necessary corporate, partnership and/or other action on the part of such Loan
Party and such Responsible Officer shall be conclusively presumed to have acted
on behalf of such Loan Party.

“Restricted
Payment” means any dividend or other distribution (whether in cash,
securities or other property) with respect to any capital stock or other Equity
Interest of any Person or any of its Subsidiaries, or any payment (whether in
cash, securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, defeasance,
acquisition, cancellation or termination of any such capital stock or other
Equity Interest, or on account of any return of capital to any Person’s
shareholders, partners or members (or the equivalent of any thereof), or any
option, warrant or other right to acquire any such dividend or other
distribution or payment. Any “earn-out” payments payable pursuant to the
Acquisition Agreement shall not be deemed to be Restricted Payments.

“Restricted Subsidiary” means any Subsidiary of the Borrower
other than an Unrestricted Subsidiary.

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

 

28

 

“Revolving
Credit Commitment” means, as to each Revolving Credit Lender, its
obligation to (a) make Revolving Credit Loans to the Borrower pursuant to Section
2.01(b), (b) purchase participations in L/C Obligations, and (c)
purchase participations in Swing Line Loans, in an aggregate principal amount
at any one time outstanding not to exceed the amount set forth opposite such
Lender’s name on Schedule 2.01 under the caption “Revolving Credit
Commitment” or opposite such caption in the Assignment and Assumption pursuant
to which such Lender becomes a party hereto, as applicable, as such amount may
be adjusted from time to time in accordance with this Agreement.

“Revolving
Credit Facility” means, at any time, the aggregate amount of the
Revolving Credit Lenders’ Revolving Credit Commitments at such time.

“Revolving Credit Increase Effective Date” has the meaning
specified in Section 2.14.

“Revolving
Credit Lender” means, at any time, any Lender that has a Revolving
Credit Commitment at such time.

“Revolving
Credit Loan” has the meaning specified in Section 2.01(b).

“Revolving
Credit Note” means a promissory note made by the Borrower in favor of a
Revolving Credit Lender evidencing Revolving Credit Loans or Swing Line Loans,
as the case may be, made by such Revolving Credit Lender, substantially in the
form of Exhibit C-2.

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

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

“SAP” means, with respect to any Regulated Insurance Company,
the accounting procedures and practices prescribed or permitted by the
Applicable Insurance Regulatory Authority of the state in which such Regulated
Insurance Company is domiciled.

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

“Secured
Parties” means, collectively, the Administrative Agent, the Lenders,
the L/C Issuer, any counterparty to a Swap Contract that is a Lender or an
Affiliate of a Lender at the time such Swap Contract is executed, each co-agent
or sub-agent appointed by the Administrative Agent from time to time pursuant
to Section 9.05, and the other Persons the Obligations owing to
which are or are purported to be secured by the Collateral under the terms of
the Collateral Documents.

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

“Solvent”
and “Solvency” mean,
with respect to any Person on any date of determination, that on such date
(a) the fair value of the property of such Person is greater than the
total amount

 

29

 

of
liabilities, including contingent liabilities, of such Person, (b) the
present fair salable value of the assets of such Person is not less than the
amount that will be required to pay the probable liability of such Person on
its debts as they become absolute and matured, (c) such Person does not
intend to incur debts or liabilities beyond such Person’s ability to pay such
debts and liabilities as they mature, (d) such Person is not engaged in
business or a transaction for which such Person’s property would constitute an
unreasonably small capital, and (e) such Person is able to pay its debts and
liabilities, contingent obligations and other commitments as they mature in the
ordinary course of business.  The amount
of contingent liabilities at any time shall be computed as the amount that, in
the light of all the facts and circumstances existing at such time, represents
the amount that can reasonably be expected to become an actual or matured
liability.

“Specified Equity Contributions” means any cash Investment
(which Investment shall be in Qualified Equity Interests) made by one or more
of the Investors to the Borrower after the Closing Date and on or prior to the
date that is 10 days after the date on which financial statements are required
to be delivered pursuant to Section 6.01(a)(i) for a fiscal year or Section
6.01(b)(i) for a fiscal quarter, as applicable.

“Subsidiary”
of a Person means a corporation, partnership, joint venture, limited liability
company or other business entity of which a majority of the shares of
securities or other interests having ordinary voting power for the election of
directors or other governing body (other than securities or interests having
such power only by reason of the happening of a contingency) are at the time
beneficially owned or otherwise controlled, directly, or indirectly through one
or more intermediaries, or both, by such Person.  Unless otherwise specified, all references
herein to a “Subsidiary” or to “Subsidiaries” shall refer to a
Subsidiary or Subsidiaries of the
Borrower.

“Swap
Contract” means (a) any and all rate swap transactions, basis swaps,
credit derivative transactions, forward rate transactions, commodity swaps,
commodity options, forward commodity contracts, equity or equity index swaps or
options, bond or bond price or bond index swaps or options or forward bond or
forward bond price or forward bond index transactions, interest rate options,
forward foreign exchange transactions, cap transactions, floor transactions,
collar transactions, currency swap transactions, cross-currency rate swap
transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all
transactions of any kind, and the related confirmations, which are subject to
the terms and conditions of, or governed by, any form of master agreement
published by the International Swaps and Derivatives Association, Inc., any
International Foreign Exchange Master Agreement, or any other master agreement
(any such master agreement, together with any related schedules, a “Master Agreement”),
including any such obligations or liabilities under any Master Agreement, in
each case, as may be amended, supplemented, replaced or otherwise modified from
time to time in accordance with this Agreement.

“Swap
Termination Value” means, in respect of any one or more Swap
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or after
the date such Swap Contracts have been closed out and termination value(s)
determined in accordance therewith, such termination value(s), and (b) for any
date prior to the date referenced in clause (a), the amount(s) determined as
the mark-to-

 

30

 

market
value(s) for such Swap Contracts, as determined based upon one or more
mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include a Lender or any Affiliate of a
Lender), in each case only to the extent representing an obligation of the
obligor thereunder.

“Swing
Line Borrowing” means a borrowing of a Swing Line Loan pursuant to Section
2.04.

“Swing
Line Lender” means Bank of America in its capacity as provider of
Swing Line Loans, or any successor swing line lender hereunder.

“Swing
Line Loan” has the meaning specified in Section 2.04(a).

“Swing
Line Loan Notice” means a notice of a Swing Line Borrowing pursuant
to Section 2.04(b), which, if in writing, shall be substantially in the
form of Exhibit B.

“Swing
Line Sublimit” means $10,000,000. 
The Swing Line Sublimit is part of, and not in addition to, the
Revolving Credit Facility.

“Synthetic
Debt” means, with respect to any Person as of any date of
determination thereof, all obligations of such Person in respect of
transactions entered into by such Person that are intended to function as a
borrowing of funds (including any
minority interest transactions that function as a borrowing) but are not
otherwise included in the definition of “Indebtedness” or as a liability
on the consolidated balance sheet of such Person and its Subsidiaries in
accordance with GAAP.

“Synthetic
Lease Obligation” means the monetary obligation of a Person under
(a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an
agreement for the use or possession of property (including sale and leaseback
transactions), in each case, creating obligations that do not appear on the
balance sheet of such Person but which, upon the application of any Debtor
Relief Laws to such Person, would be characterized as the indebtedness of such
Person (without regard to accounting treatment).

“Taxes”
means all present or future taxes, levies, withholdings, assessments or other
like charges imposed by any Governmental Authority, including any interest,
additions to tax or penalties applicable thereto.

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

“Term
Commitment” means, as to each Term Lender, its obligation to
make Term Loans to the Borrower pursuant to Section 2.01(a) in an
aggregate principal amount at any one time outstanding not to exceed the amount
set forth opposite such Term Lender’s name on Schedule 2.01 under
the caption “Term Commitment” or opposite such caption in the Assignment and
Assumption pursuant to which such Term Lender becomes a party hereto, as
applicable, as such amount may be adjusted from time to time in accordance with
this Agreement.

 

31

“Term Increase Effective Date” has the meaning specified in Section
2.15(d).

“Term
Facility” means, at any time, (a) on or prior to the Closing Date, the aggregate amount of the
Term Commitments at such time, and (b) thereafter, the
aggregate principal amount of the Term Loans of all Term Lenders
outstanding at such time; as such Term Loans may be increased pursuant to Section
2.15.

“Term Facility Increase Effective Date” has the meaning
specified in Section 2.15(d).

“Term Lender” means (a) at any time on or prior to the
Closing Date, any Lender that has a Term Commitment at such time and
(b) at any time after the Closing Date, any Lender that holds Term Loans
at such time.

“Term
Loan” means an advance made by any Term Lender under the Term
Facility.

“Term Note” means a promissory note made by the Borrower in
favor of a Term Lender evidencing Term Loans made by such
Term Lender, substantially in the form of Exhibit C-1.

“Threshold
Amount” means $25,000,000.

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

“Total
Outstandings” means the aggregate Outstanding Amount of all Loans
and all L/C Obligations.

“Total Revolving Credit Outstandings” means the aggregate
Outstanding Amount of all Revolving Credit Loans, Swing Line Loans and L/C
Obligations.

“TPA EBITDA” means, for
any period for the TPA Operations, an amount equal to the TPA Net Income for
such period plus the following to the extent deducted in calculating
such TPA Net Income: (a) consolidated interest expense of the TPA Operations
for such period, (b) the provision for Federal, state, local and foreign income taxes payable by
the TPA Operations for such period (net of any Federal, state, local and
foreign income tax credits attributable to the TPA Operations for such period)  and (c) the amount of depreciation and
amortization expense deducted in determining such TPA Net Income.

“TPA Net Income” shall mean, for any
period for the TPA Operations, the consolidated net income of the TPA
Operations (excluding non-cash gains and losses) for such period determined in accordance with GAAP.

“TPA Operations” shall mean CHCS Services,
Inc. and its Restricted Subsidiaries that are Non-Regulated Companies.

“Transactions” shall mean, collectively, (a) the Acquisition,
(b) the Refinancing, (c) the incurrence by the Borrower of Loans and/or L/C
Obligations hereunder on the Closing Date and (d) the payment of fees and
expenses in connection with the foregoing.

 

32

 

“Trust Preferred Securities” shall mean (a) the Floating Rate
Junior Subordinated Deferrable Interest Debentures issued by the Borrower
pursuant to the Indenture dated as of December 4, 2002 (as amended,
modified or supplemented from time to time), between the Borrower and State
Street Bank and Trust Company of Connecticut, National Association, as trustee,
and the guaranty executed in connection therewith, (b) the Floating Rate Junior
Subordinated Deferrable Interest Debentures issued by the Borrower pursuant to
the Indenture dated as of March 27, 2003 (as amended, modified or supplemented
from time to time), between the Borrower and Wells Fargo Bank, National
Association, as trustee, and the guaranty executed in connection therewith, (c)
the Fixed/Floating Rate Junior Subordinated Deferrable Interest Debentures
issued by the Borrower pursuant to the Indenture dated as of May 15, 2003 (as
amended, modified or supplemented from time to time), between the Borrower and
U.S. Bank National Association, as debenture trustee, and the guaranty executed
in connection therewith, (d) the Floating Rate Junior Subordinated Debt
Securities issued by the Borrower pursuant to the Indenture dated as of
May 22, 2003 (as amended, modified or supplemented from time to time),
between the Borrower and the Wilmington Trust Company, as trustee, and the
guaranty executed in connection therewith, (e) the Floating Rate Junior
Subordinated Deferrable Interest Debentures issued by the Borrower pursuant to
the Indenture dated as of October 29, 2003 (as amended, modified or
supplemented from time to time), between the Borrower and U.S. Bank National
Association, as debenture trustee, and the guaranty executed in connection
therewith and (f) the Fixed/Floating Rate Junior Subordinated Deferrable
Interest Debentures issued by the Borrower pursuant to the Indenture dated as
of March 22, 2007 (as amended, modified or supplemented from time to time),
between the Borrower and Wilmington Trust Company, as trustee, and the guaranty
executed in connection therewith.

“Type”
means, with respect to a Loan, its character as a Base Rate Loan or a
Eurodollar Rate Loan.

“UCC” means the Uniform Commercial Code as in effect in the
State of New York; provided
that, if perfection or the effect of perfection or non-perfection or the
priority of any security interest in any Collateral is governed by the Uniform
Commercial Code as in effect in a jurisdiction other than the State of New York, “UCC” means the
Uniform Commercial Code as in effect from time to time in such other
jurisdiction for purposes of the provisions hereof relating to such perfection,
effect of perfection or non-perfection or priority.

“Unfunded Pension Liability” means the excess of a Pension Plan’s
benefit liabilities under Section 4001(a)(16) of ERISA, over the current
value of that Pension Plan’s assets, determined in accordance with the
assumptions used for funding the Pension Plan pursuant to Section 412 of
the Code for the applicable plan year.

“United
States” and “U.S.” mean the United States of America.

“Unreimbursed
Amount” has the meaning specified in Section 2.03(c)(i).

“Unrestricted Subsidiary” means (a) as of the date hereof, each
Subsidiary listed on Schedule 1.01C and (b) each other Subsidiary
other than a Regulated Insurance Company designated by the Borrower as an
Unrestricted Subsidiary pursuant to Section 6.15 subsequent to

 

33

 

the
date hereof, in each case unless and until such Subsidiary is designated as a
Restricted Subsidiary in accordance herewith.

“Weighted Average Life to Maturity” means, when applied to any
Indebtedness at any date, the number of years obtained by dividing: (a) the sum
of the products obtained by multiplying (i) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (ii) the
number of years (calculated to the nearest one-twelfth) that will elapse
between such date and the making of such payment; by (b) the then outstanding
principal amount of such Indebtedness.

“Wholly-Owned Subsidiary” of any Person means any Subsidiary of
such Person to the extent all of the Equity Interests in such Subsidiary, other
than directors’ or nominees’ qualifying shares, are owned directly or
indirectly by such Person.

“WorldNet” means WorldNet Services Corp., a Florida corporation.

1.02         Other Interpretive Provisions.  With reference to this Agreement and each
other Loan Document, unless otherwise specified herein or in such other Loan
Document:

(a)           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, (i)
any definition of or reference to any agreement, instrument or other document
(including any Organization Document) 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 or in any other Loan Document),
(ii) any reference herein to any Person shall be construed to include such
Person’s successors and assigns, (iii) the words “herein,” “hereof”
and “hereunder,” and words of similar import when used in any Loan
Document, shall be construed to refer to such Loan Document in its entirety and
not to any particular provision thereof, (iv) all references in a Loan Document
to Articles, Sections, Preliminary Statements, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Preliminary Statements,
Exhibits and Schedules to, the Loan Document in which such references appear,
(v) any reference to any law shall include all statutory and regulatory
provisions consolidating, amending, replacing or interpreting such law and any
reference to any law or regulation shall, unless otherwise specified, refer to
such law or regulation as amended, modified or supplemented from time to time,
and (vi) 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.

 

34

 

(b)           In the computation
of periods of time from a specified date to a later specified date, the word “from”
means “from and including;” the words “to” and “until”
each mean “to but excluding;” and the word “through” means “to
and including.”

(c)           Section headings
herein and in the other Loan Documents are included for convenience of
reference only and shall not affect the interpretation of this Agreement or any
other Loan Document.

1.03         Accounting Terms.

(a)           Generally.  All accounting
terms not specifically or completely defined herein shall be construed in
conformity with, and all financial data (including financial ratios and other
financial calculations) required to be submitted pursuant to this Agreement
shall be prepared in conformity with, GAAP or SAP, as applicable, applied on a
consistent basis, as in effect from time to time, applied in a manner
consistent with that used in preparing the Audited Financial Statements, except
as otherwise specifically prescribed herein.

(b)           Changes in
GAAP or SAP.  If at any time any change in GAAP or SAP
would affect the computation of any financial ratio or requirement set forth in
any Loan Document, and either the Borrower or the Required Lenders shall so
request, the Administrative Agent, the Lenders and the Borrower shall negotiate
in good faith to amend such ratio or requirement to preserve the original
intent thereof in light of such change in GAAP or SAP (subject to the approval
of the Required Lenders); provided that, until so amended, (i) such
ratio or requirement shall continue to be computed in accordance with GAAP or
SAP, as applicable, prior to such change therein and (ii) the Borrower
shall provide to the Administrative Agent and the Lenders financial statements
and other documents required under this Agreement or as reasonably requested
hereunder setting forth a reconciliation between calculations of such ratio or
requirement made before and after giving effect to such change in GAAP or SAP,
as applicable.

1.04         Rounding.  Any financial ratios required to be
maintained by the Borrower pursuant to this Agreement shall be calculated by dividing
the appropriate component by the other component, carrying the result to one
place more than the number of places by which such ratio is expressed herein
and rounding the result up or down to the nearest number (with a rounding-up if
there is no nearest number).

1.05         Times of Day.  Unless otherwise specified, all references
herein to times of day shall be references to Eastern time (daylight or
standard, as applicable).

1.06         Letter of Credit Amounts. Unless
otherwise specified herein, the amount of a Letter of Credit at any time shall
be deemed to be the stated amount of such Letter of Credit in effect at such
time; provided, however, that with respect to any Letter of Credit that, by its
terms or the terms of any Issuer Document related thereto, provides for one or
more automatic increases in the stated amount thereof, the amount of such
Letter of Credit shall be deemed to be the maximum stated amount of such Letter
of Credit after giving effect to all such increases, whether or not such
maximum stated amount is in effect at such time.

 

35

 

ARTICLE II

THE COMMITMENTS AND CREDIT EXTENSIONS

2.01         The
Loans.

(a)           The
Term Borrowing.  Subject to the terms and conditions set forth
herein, each Term Lender severally agrees to make a single loan to the
Borrower on the Closing Date in an amount  not
to exceed such Term Lender’s Term Commitment.  The Term Borrowing shall consist of Term
Loans made simultaneously by the Term Lenders in accordance with their
respective Applicable Percentage of the Term Facility.  Amounts borrowed under this Section 2.01(a)
and repaid or prepaid may not be reborrowed. 
Term Loans may be Base Rate Loans or Eurodollar Rate Loans, as further
provided herein.  The Borrower hereby
authorizes and directs the Administrative Agent to deliver on the Closing Date
$257,399,174.16 of the Term Borrowing to the escrow agent under the escrow
agreement that is part of the Escrow Documents.

(b)           The Revolving
Credit Borrowings.  Subject to the terms and conditions set forth
herein, each Revolving Credit Lender severally agrees to make loans (each such
loan, a “Revolving Credit Loan”) to the Borrower from time to time, on any Business Day
during the Availability Period, in an aggregate amount not to exceed at any
time outstanding the amount of such Lender’s Revolving Credit Commitment; provided,
however, that after giving effect to any Revolving Credit Borrowing, (i)
the Total Revolving Credit Outstandings shall not exceed the Revolving Credit
Facility, and (ii) the aggregate Outstanding Amount of the Revolving Credit
Loans of any Revolving Credit Lender, plus such Revolving Credit Lender’s
Applicable Revolving Credit Percentage of the Outstanding Amount of all L/C
Obligations, plus such Revolving Credit Lender’s Applicable Revolving
Credit Percentage of the Outstanding Amount of all Swing Line Loans shall not
exceed such Revolving Credit Lender’s Revolving Credit Commitment; provided
further, that the Revolving Credit Loans borrowed on the Closing Date
may not exceed $10,000,000.  Within the
limits of each Revolving Credit Lender’s Revolving Credit Commitment, and
subject to the other terms and conditions hereof, the Borrower may borrow under
this Section 2.01(b), prepay under Section 2.05, and reborrow
under this Section 2.01(b). 
Revolving Credit Loans may be Base Rate Loans or Eurodollar Rate Loans,
as further provided herein.

2.02         Borrowings, Conversions and
Continuations of Loans.

(a)           Each
Term Borrowing, each Additional Term Facility Borrowing, each Revolving Credit
Borrowing, each conversion of Term Loans, Additional Term Facility Loans or
Revolving Credit Loans from one Type to the other, and each continuation of
Eurodollar Rate 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 1:00 p.m. (i) three Business Days prior to
the requested date of any Borrowing of, conversion to or continuation of
Eurodollar Rate Loans or of any conversion of Eurodollar Rate Loans to Base
Rate Loans, and (ii) on the requested date of any Borrowing of Base Rate Loans,
whereupon the Administrative Agent shall give prompt notice to the Appropriate
Lenders of such

 

36

 

request and determine whether
the requested Interest Period (if nine or twelve months) is available to all of
the Appropriate Lenders.  Each telephonic
notice by the Borrower pursuant to this Section 2.02(a) must be
confirmed promptly by delivery to the Administrative Agent of a written
Committed Loan Notice, appropriately completed and signed by a Responsible
Officer of the Borrower.  Each Borrowing
of, conversion to or continuation of Eurodollar Rate Loans shall be in a principal
amount of $2,500,000 or a whole multiple of $500,000 in excess thereof.  Except as provided in Sections 2.03(c)
and 2.04(c), each Borrowing of or conversion to Base Rate Loans shall be
in a principal amount of $500,000 or a whole multiple of $100,000 in excess
thereof.  Each Committed Loan Notice
(whether telephonic or written) shall specify (i) whether the Borrower is
requesting a Term Borrowing, an Additional Term Facility Borrowing, a Revolving
Credit Borrowing, a conversion of Term Loans, Additional Term Loans or
Revolving Credit Loans from one Type to the other, or a continuation of
Eurodollar Rate Loans, (ii) the requested date of the Borrowing, conversion or
continuation, as the case may be (which shall be a Business Day), (iii) the
principal amount of Loans to be borrowed, converted or continued, (iv) the Type
of Loans to be borrowed or to which existing Term Loans, Additional Term Loans,
or Revolving Credit Loans are to be converted, and (v) if applicable, the
duration of the Interest Period with respect thereto.  If the Borrower fails to specify a Type of
Loan in a Committed Loan Notice or if the Borrower fails to give a timely
notice requesting a conversion or continuation, then the applicable Term Loans,
Additional Term Facility Loans or Revolving Credit Loans shall be made as, or
converted to, Base Rate Loans.  Any such
automatic conversion to Base Rate Loans shall be effective as of the last day
of the Interest Period then in effect with respect to the applicable Eurodollar
Rate Loans.  If the Borrower requests a
Borrowing of, conversion to, or continuation of Eurodollar Rate Loans in any
such Committed Loan Notice, but fails to specify an Interest Period, or if the
Borrower requests an Interest Period of nine or twelve months and such Interest
Period is not acceptable to all of the Appropriate Lenders, the Borrower will
be deemed to have specified an Interest Period of one month.  Notwithstanding anything to the contrary
herein, a Swing Line Loan may not be converted to a Eurodollar Rate Loan.

(b)           Following
receipt of a Committed Loan Notice, the Administrative Agent shall promptly
notify each Lender of the amount of its Applicable Percentage under the
applicable Facility of the applicable Term Loans, Additional Term Facility
Loans or Revolving Credit Loans, 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 Base Rate Loans
described in Section 2.02(a).  In
the case of a Term Borrowing, an Additional Term Facility Borrowing or a
Revolving Credit Borrowing, each Appropriate Lender shall make the amount of
its Loan available to the Administrative Agent in immediately available funds
at the Administrative Agent’s Office not later than 2:00 p.m. on the Business
Day specified in the applicable Committed Loan Notice.  Upon satisfaction of the applicable
conditions set forth in Section 4.02 (and, if such Borrowing is the
initial Credit Extension, Section 4.01 or, if such Borrowing is an
Additional Term Facility Borrowing, in the amendment or supplement to this
Agreement relating to such Additional Term Facility), the Administrative Agent
shall make all funds so received available to the Borrower on the same Business
Day in like funds as received by the Administrative Agent either by (i)

 

37

 

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; provided,
however, that if, on the date a Revolving Credit Borrowing is to be
made, there are L/C Borrowings outstanding, then the proceeds of such Revolving
Credit Borrowing, first, shall be applied to the payment in full of any
such L/C Borrowings, and second, shall be made available to the Borrower
as provided above.

(c)           Except as
otherwise provided herein, a Eurodollar Rate Loan may be continued or converted
only on the last day of an Interest Period for such Eurodollar Rate Loan.  During the existence of a Default, no Loans
may be requested as, converted to or continued as Eurodollar Rate Loans without
the consent of the Required Lenders under the Facility under which such Loans
are outstanding.

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

(e)           After giving
effect to all Term Borrowings, all conversions of Term Loans from one Type to
the other, and all continuations of Term Loans as the same Type, there shall
not be more than ten Interest Periods in effect in respect of the Term
Facility.  After giving effect to all
Additional Term Facility Borrowings, all conversions of Additional Term Loans
from one Type to the other, and all continuations of Additional Term Loans as
the same Type, there shall not be more than ten Interest Periods in effect in
respect of any Additional Term Facility. After giving effect to all Revolving
Credit Borrowings, all conversions of Revolving Credit Loans from one Type to
the other, and all continuations of Revolving Credit Loans as the same Type, there
shall not be more than fifteen Interest Periods in effect in respect of the
Revolving Credit Facility.

2.03         Letters of Credit.

(a)           The
Letter of Credit Commitment.

(i)            Subject to the
terms and conditions set forth herein, (A) the L/C Issuer agrees, in reliance
upon the agreements of the Revolving Credit Lenders set forth in this Section
2.03, (1) from time to time on any Business Day during the period from the
Closing Date until the Letter of Credit Expiration Date, to issue Letters of
Credit for the account of the Borrower or its Restricted Subsidiaries, and to
amend or extend Letters of Credit previously issued by it, in accordance with Section
2.03(b), and (2) to honor drawings under the Letters of Credit; and (B) the
Revolving Credit Lenders severally agree to participate in Letters of Credit
issued for the account of the Borrower or its Restricted Subsidiaries and any
drawings thereunder; provided that after giving effect to any L/C Credit
Extension with respect to any Letter of Credit, (x) the Total Revolving Credit

 

38

 

Outstandings
shall not exceed the Revolving Credit Facility, (y) the aggregate Outstanding
Amount of the Revolving Credit Loans of any Revolving Credit Lender, plus
such Lender’s Applicable Revolving Credit Percentage of the Outstanding Amount
of all L/C Obligations, plus such Lender’s Applicable Revolving Credit
Percentage of the Outstanding Amount of all Swing Line Loans shall not exceed
such Lender’s Revolving Credit Commitment and (z) the Outstanding Amount of the
L/C Obligations shall not exceed the Letter of Credit Sublimit.  Each request by the Borrower for the issuance
or amendment of a Letter of Credit shall be deemed to be a representation by
the Borrower that the L/C Credit Extension so requested complies with the
conditions set forth in the proviso to the preceding sentence.  Within the foregoing limits, and subject to
the terms and conditions hereof, the Borrower’s ability to obtain Letters of
Credit shall be fully revolving, and accordingly the Borrower may, during the
foregoing period, obtain Letters of Credit to replace Letters of Credit that
have expired or that have been drawn upon and reimbursed.  All Existing Letters of Credit shall be
deemed to have been issued pursuant hereto, and from and after the Closing Date
shall be subject to and governed by the terms and conditions hereof.

(ii)           The L/C Issuer
shall not issue any Letter of Credit if:

(A)          subject to Section 2.03(b)(iii),
the expiry date of such requested Letter of Credit would occur more than twelve
months after the date of issuance or
last extension, unless the Required Revolving Lenders have approved such
expiry date; or

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

(iii)          The L/C Issuer
shall not be under any obligation to issue any Letter of Credit if:

(A)          any order, judgment or decree of any Governmental Authority
or arbitrator shall by its terms purport to enjoin or restrain the L/C Issuer
from issuing such Letter of Credit, or any Law applicable to the L/C Issuer
shall prohibit the issuance of letters of credit generally or such Letter of
Credit in particular or shall impose upon the L/C Issuer with respect to such
Letter of Credit any restriction, reserve or capital requirement (for which the
L/C Issuer is not otherwise compensated hereunder) not in effect on the Closing
Date, or shall impose upon the L/C Issuer any unreimbursed loss, cost or
expense which was not applicable on the Closing Date and which the L/C Issuer
in good faith deems material to it;

(B)           the issuance of such Letter of Credit would violate one or
more policies of the L/C Issuer applicable to letters of credit generally;

 

39

 

(C)           except as otherwise agreed by the Administrative Agent and
the L/C Issuer, such Letter of Credit is in an initial stated amount less than
$100,000;

(D)          such Letter of Credit is to be denominated in a currency
other than Dollars;

(E)           such Letter of Credit contains any provisions for
automatic reinstatement of the stated amount after any drawing thereunder; or

(F)           a default of any Revolving Credit Lender’s obligations to
fund under Section 2.03(c) exists or any Revolving Credit Lender is at
such time a Defaulting Lender hereunder, unless the L/C Issuer has entered into
reasonably satisfactory arrangements with the Borrower or such Lender to
eliminate the L/C Issuer’s risk with respect to such Lender.

(iv)          The L/C Issuer shall
not amend any Letter of Credit if the L/C Issuer would not be permitted at such
time to issue such Letter of Credit in its amended form under the terms hereof.

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

(vi)          The L/C Issuer shall
act on behalf of the Revolving Credit Lenders with respect to any Letters of
Credit issued by it and the documents associated therewith, and the L/C Issuer
shall have all of the benefits and immunities (A) provided to the Administrative
Agent in Article IX with respect to any acts taken or omissions suffered
by the L/C Issuer in connection with Letters of Credit issued by it or proposed
to be issued by it and Issuer Documents pertaining to such Letters of Credit as
fully as if the term “Administrative Agent” as used in Article IX
included the L/C Issuer with respect to such acts or omissions, and (B) as
additionally provided herein with respect to the L/C Issuer.

(b)           Procedures
for Issuance and Amendment of Letters of Credit; Auto-Extension Letters of
Credit.

(i)            Each Letter of
Credit shall be issued or amended, as the case may be, upon the request of the
Borrower delivered to the L/C Issuer (with a copy to the Administrative Agent)
in the form of a Letter of Credit Application, appropriately completed and
signed by a Responsible Officer of the Borrower.  Such Letter of Credit Application must be
received by the L/C Issuer and the Administrative Agent not later than 2:00
p.m. at least two Business Days (or such later date and time as the
Administrative Agent and the L/C Issuer may agree in a particular instance in
their reasonable discretion) prior to the proposed issuance date or date of
amendment, as the case may be.  In the
case of a request for an

 

40

 

initial
issuance of a Letter of Credit, such Letter of Credit Application shall specify
in form and detail reasonably satisfactory to the L/C Issuer:  (A) the proposed issuance date of the
requested Letter of Credit (which shall be a Business Day); (B) the amount
thereof; (C) the expiry date thereof; (D) the name and address of the
beneficiary thereof; (E) the documents to be presented by such beneficiary in
case of any drawing thereunder; (F) the full text of any certificate to be
presented by such beneficiary in case of any drawing thereunder; (G) the
purpose and nature of the requested Letter of Credit; and (H) such other
matters as the L/C Issuer may reasonably require.  In the case of a request for an amendment of
any outstanding Letter of Credit, such Letter of Credit Application shall
specify in form and detail reasonably satisfactory to the L/C Issuer (1) the
Letter of Credit to be amended; (2) the proposed date of amendment thereof
(which shall be a Business Day); (3) the nature of the proposed amendment; and
(4) such other matters as the L/C Issuer may reasonably require.  Additionally, the Borrower shall furnish to
the L/C Issuer and the Administrative Agent such other documents and information
pertaining to such requested Letter of Credit issuance or amendment, including
any Issuer Documents, as the L/C Issuer or the Administrative Agent may
reasonably require.

(ii)           Promptly
after receipt of any Letter of Credit Application, the L/C Issuer will confirm
with the Administrative Agent (by telephone or in writing) that the
Administrative Agent has received a copy of such Letter of Credit Application
from the Borrower and, if not, the L/C Issuer will provide the Administrative
Agent with a copy thereof.  Unless the
L/C Issuer has received written notice from any Revolving Credit Lender, the
Administrative Agent or any Loan Party, at least one Business Day prior to the
requested date of issuance or amendment of the applicable Letter of Credit,
that one or more applicable conditions contained in Article IV shall not
then be satisfied, then, subject to the terms and conditions hereof, the L/C
Issuer shall, on the requested date, issue a Letter of Credit for the account
of the Borrower (or the applicable
Restricted Subsidiary) or enter into the applicable amendment, as the case
may be, in each case in accordance with the L/C Issuer’s usual and customary
business practices.  Immediately upon the
issuance of each Letter of Credit, each Revolving Credit Lender shall be deemed
to, and hereby irrevocably and unconditionally agrees to, purchase from the L/C
Issuer a risk participation in such Letter of Credit in an amount equal to the
product of such Revolving Credit Lender’s Applicable Revolving Credit
Percentage times the amount of such Letter of Credit.

(iii)          If the Borrower so requests in any
applicable Letter of Credit Application, the L/C Issuer may, in its sole and
absolute discretion, agree to issue a Letter of Credit that has automatic
extension provisions (each, an “Auto-Extension Letter of Credit”); provided that any such Auto-Extension Letter of Credit must
permit the L/C Issuer to prevent any such extension at least once in each
twelve-month period (commencing with the date of issuance of such Letter of
Credit) by giving prior notice to the beneficiary thereof not later than a day
(the “Non-Extension
Notice Date”) in each such
twelve-month period to be agreed upon at the time such Letter of Credit is
issued.  Unless otherwise directed by the

 

41

 

L/C Issuer in accordance with the terms
hereof, the Borrower shall not be required to make a specific request to the
L/C Issuer for any such extension.  Once
an Auto-Extension Letter of Credit has been issued, the Revolving Credit
Lenders shall be deemed to have authorized (but may not require) the L/C Issuer
to permit the extension of such Letter of Credit at any time to an expiry date
not later than the Letter of Credit Expiration Date; provided, however,
that the L/C Issuer shall not permit any such extension if (A) the L/C Issuer
has determined that it would not be permitted, or would have no obligation at
such time to issue such Letter of Credit in its revised form (as extended)
under the terms hereof (by reason of the provisions of clause (ii) or (iii) of Section
2.03(a) or otherwise), or (B) it has received notice (which may be by
telephone or in writing) on or before the day that is seven Business Days
before the Non-Extension Notice Date (1) from the Administrative Agent that the
Required Revolving Lenders have elected not to permit such extension or (2)
from the Administrative Agent, any Revolving Credit Lender or the Borrower that
one or more of the applicable conditions specified in Section 4.02 is
not then satisfied, and in each such case directing the L/C Issuer not to
permit such extension.

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

(c)           Drawings and
Reimbursements; Funding of Participations.

(i)            The
L/C Issuer shall promptly notify the Borrower and the Administrative Agent of
the receipt from the beneficiary of any Letter of Credit of a drawing under
such Letter of Credit and of any payment by the L/C Issuer of such
drawing.  The Borrower shall reimburse
the L/C Issuer through the Administrative Agent in an amount equal to (x) the
amount of each such drawing paid by the L/C Issuer (A) on the Business Day on
which the L/C Issuer notifies the Borrower if the L/C Issuer notifies the
Borrower thereof at or prior to 11:00 a.m. on such Business Day or (B) on the
Business Day immediately following the Business Day on which the L/C Issuer
notifies the Borrower if the L/C Issuer notifies the Borrower thereof after
11:00 a.m. on such Business Day, plus (y) if such reimbursement is made
pursuant to clause (B) preceding, interest on such reimbursement from the date
on which the L/C Issuer notifies the Borrower to the date of such reimbursement
at the interest rate applicable to Base Rate Loans.  If the Borrower fails to so reimburse the L/C
Issuer by such time, the Administrative Agent shall promptly notify each
Revolving Credit Lender of such failure, the amount of the unreimbursed drawing
(the “Unreimbursed Amount”), and the amount of such Revolving Credit
Lender’s Applicable Revolving Credit Percentage thereof.  In such event, the Borrower shall be deemed
to have requested a Revolving Credit Borrowing of Base Rate Loans to be
disbursed on the date the Borrower was required, but failed, to pay the
Unreimbursed Amount, in an amount equal to the Unreimbursed Amount, without
regard to the minimum

 

42

 

and multiples specified in Section 2.02 for the principal amount
of Base Rate Loans, but subject to the amount of the unutilized portion of the
Revolving Credit Commitments and the conditions set forth in Section 4.02
(other than the delivery of a Committed Loan Notice).  Any notice given by the L/C Issuer or the
Administrative Agent pursuant to this Section 2.03(c)(i) may be given by
telephone if immediately confirmed in writing; provided that the lack of
such an immediate confirmation shall not affect the conclusiveness or binding
effect of such notice.

(ii)           Each
Revolving Credit Lender shall upon any notice pursuant to Section 2.03(c)(i)
make funds available to the Administrative Agent for the account of the L/C
Issuer at the Administrative Agent’s Office in an amount equal to its
Applicable Revolving Credit Percentage of the Unreimbursed Amount not later
than 1:00 p.m. on the Business Day specified in such notice by the
Administrative Agent, whereupon, subject to the provisions of Section
2.03(c)(iii), each Revolving Credit Lender that so makes funds available
shall be deemed to have made a Base Rate Loan to the Borrower in such
amount.  The Administrative Agent shall
remit the funds so received to the L/C Issuer.

(iii)          With
respect to any Unreimbursed Amount that is not fully refinanced by a Revolving
Credit Borrowing of Base Rate Loans because the conditions set forth in Section 4.02
cannot be satisfied or for any other reason, the Borrower shall be deemed to
have incurred from the L/C Issuer an L/C Borrowing in the amount of the
Unreimbursed Amount that is not so refinanced, which L/C Borrowing shall be due
and payable on demand (together with interest) and shall bear interest at the
Default Rate.  In such event, each
Revolving Credit Lender’s payment to the Administrative Agent for the account
of the L/C Issuer pursuant to Section 2.03(c)(ii) shall be deemed
payment in respect of its participation in such L/C Borrowing and shall
constitute an L/C Advance from such Lender in satisfaction of its participation
obligation under this Section 2.03.

(iv)          Until
each Revolving Credit Lender funds its Revolving Credit Loan or L/C Advance
pursuant to this Section 2.03(c) to reimburse the L/C Issuer for any
amount drawn under any Letter of Credit, interest in respect of such Lender’s
Applicable Revolving Credit Percentage of such amount shall be solely for the
account of the L/C Issuer.

(v)           Each
Revolving Credit Lender’s obligation to make Revolving Credit Loans or L/C
Advances to reimburse the L/C Issuer for amounts drawn under Letters of Credit,
as contemplated by this Section 2.03(c), shall be absolute and
unconditional and shall not be affected by any circumstance, including (A) any
setoff, counterclaim, recoupment, defense or other right which such Lender may
have against the L/C Issuer, the Borrower or any other Person for any reason
whatsoever; (B) the occurrence or continuance of a Default, or (C) any other
occurrence, event or condition, whether or not similar to any of the foregoing;
provided, however, that each Revolving Credit Lender’s obligation
to make Revolving Credit Loans pursuant to this Section 2.03(c) is
subject to the

 

43

 

conditions set forth in Section 4.02 (other than delivery by the
Borrower of a Committed Loan Notice ). 
No such making of an L/C Advance shall relieve or otherwise impair the
obligation of the Borrower to reimburse the L/C Issuer for the amount of any
payment made by the L/C Issuer under any Letter of Credit, together with
interest as provided herein.

(vi)          If
any Revolving Credit Lender fails to make available to the Administrative Agent
for the account of the L/C Issuer any amount required to be paid by such Lender
pursuant to the foregoing provisions of this Section 2.03(c) by the time
specified in Section 2.03(c)(ii), the L/C Issuer shall be entitled to
recover from such Lender (acting through the Administrative Agent), on demand,
such amount with interest thereon for the period from the date such payment is
required to the date on which such payment is immediately available to the L/C
Issuer at a rate per annum equal to the greater of the Federal Funds Rate and a
rate determined by the L/C Issuer in accordance with banking industry rules on
interbank compensation, plus any administrative, processing or similar
fees customarily charged by the L/C Issuer in connection with the
foregoing.  If such Lender pays such
amount (with interest and fees as aforesaid), the amount so paid shall
constitute such Lender’s Revolving Credit Loan included in the relevant
Borrowing or L/C Advance in respect of the relevant L/C Borrowing, as the case
may be.  A certificate of the L/C Issuer
submitted to any Revolving Credit Lender (through the Administrative Agent)
with respect to any amounts owing under this Section 2.03(c)(vi)
shall be conclusive absent manifest error.

(d)           Repayment of
Participations.

(i)            At any time after the L/C Issuer has made a payment under
any Letter of Credit and has received from any Revolving Credit Lender such
Lender’s L/C Advance in respect of such payment in accordance with Section
2.03(c), if the Administrative Agent receives for the account of the L/C
Issuer any payment in respect of the related Unreimbursed Amount or interest
thereon (whether directly from the Borrower or otherwise, including proceeds of
Cash Collateral applied thereto by the Administrative Agent), the
Administrative Agent will distribute to such Lender its Applicable Revolving
Credit Percentage thereof in the same funds as those received by the
Administrative Agent.

(ii)           If
any payment received by the Administrative Agent for the account of the L/C
Issuer pursuant to Section 2.03(c)(i) is required to be returned under
any of the circumstances described in Section 10.05 (including pursuant
to any settlement entered into by the L/C Issuer in its reasonable discretion),
each Revolving Credit Lender shall pay to the Administrative Agent for the
account of the L/C Issuer its Applicable Revolving Credit Percentage thereof on
demand of the Administrative Agent, plus interest thereon from the date
of such demand to the date such amount is returned by such Lender, at a rate
per annum equal to the Federal Funds Rate from time to time in effect.  The obligations of the Lenders under this
clause shall survive the payment in full of the Obligations and the termination
of this Agreement.

 

44

 

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

(i)            any
lack of validity or enforceability of such Letter of Credit, this Agreement, or
any other Loan Document;

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

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

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

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

The Borrower shall promptly examine a copy of
each Letter of Credit and each amendment thereto that is delivered to it and,
in the event of any claim of noncompliance with the Borrower’s instructions or
other irregularity, the Borrower will immediately notify the L/C Issuer.  The Borrower shall be conclusively deemed to
have waived any such claim against the L/C Issuer and its correspondents unless
such notice is given as aforesaid.

(f)            Role
of L/C Issuer.  Each Revolving Credit Lender and the Borrower
agree that, in paying any drawing under a Letter of Credit, the L/C Issuer
shall not have any responsibility to obtain any document (other than any sight
draft, certificates and documents expressly required by the Letter of Credit)
or to ascertain or inquire as to the

 

45

 

validity or accuracy of any such
document or the authority of the Person executing or delivering any such
document.  None of the L/C Issuer, the
Administrative Agent, any of their respective Related Parties nor any
correspondent, participant or assignee of the L/C Issuer shall be liable to any
Revolving Credit Lender for (i) any action taken or omitted in connection
herewith at the request or with the approval of the Revolving Credit Lenders or
the Required Revolving Lenders, as applicable; (ii) any action taken or omitted
in the absence of bad faith, gross negligence or willful misconduct; or (iii)
the due execution, effectiveness, validity or enforceability of any document or
instrument related to any Letter of Credit or Issuer Document.  The Borrower hereby assumes all risks of the
acts or omissions of any beneficiary or transferee with respect to its use of
any Letter of Credit; provided, however, that this assumption is
not intended to, and shall not, preclude the Borrower’s pursuing such rights
and remedies as it may have against the beneficiary or transferee at law or
under any other agreement.  None of the
L/C Issuer, the Administrative Agent, any of their respective Related Parties
nor any correspondent, participant or assignee of the L/C Issuer shall be
liable or responsible for any of the matters described in clauses (i) through
(v) of Section 2.03(e); provided, however, that anything
in such clauses to the contrary notwithstanding, the Borrower may have a claim
against the L/C Issuer, and the L/C Issuer may be liable to the Borrower, to
the extent, but only to the extent, of any direct, as opposed to consequential
or exemplary, damages suffered by the Borrower which the Borrower proves were
caused by the L/C Issuer’s bad faith, willful misconduct or gross negligence or
the L/C Issuer’s willful failure to pay under any Letter of Credit after the
presentation to it by the beneficiary of a sight draft and certificate(s) strictly
complying with the terms and conditions of a Letter of Credit.  In furtherance and not in limitation of the
foregoing, the L/C Issuer may accept documents that appear on their face to be
in order, without responsibility for further investigation, regardless of any
notice or information to the contrary, and the L/C Issuer shall not be
responsible for the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign a Letter of Credit or the rights
or benefits thereunder or proceeds thereof, in whole or in part, which may
prove to be invalid or ineffective for any reason.

(g)           Cash
Collateral.  Upon the request of the Administrative Agent,
(i) if the L/C Issuer has honored any full or partial drawing request under any
Letter of Credit and such drawing has resulted in an L/C Borrowing, or (ii) if,
as of the Letter of Credit Expiration Date, any L/C Obligation for any reason
remains outstanding, the Borrower shall, in each case, immediately Cash
Collateralize the then Outstanding Amount of all L/C Obligations.  Section 8.02(c) sets forth certain
additional requirements to deliver Cash Collateral hereunder.  For purposes of this Section 2.03 and Section
8.02(c), “Cash Collateralize” means to pledge and deposit with or deliver to the
Administrative Agent, for the benefit of the L/C Issuer and the Lenders, as
collateral for the Obligations, cash or deposit account balances pursuant to
documentation in form and substance reasonably satisfactory to the
Administrative Agent and the L/C Issuer (which documents are hereby consented
to by the Lenders).  Derivatives of such
term have corresponding meanings.  The
Borrower hereby grants to the Administrative Agent, for the benefit of the L/C
Issuer and the Lenders, a security interest in all such cash, deposit accounts
and all balances therein and all proceeds of the foregoing.  Cash Collateral shall be maintained in
blocked, non-interest bearing deposit accounts at Bank of America.  If at any time the

 

46

 

Administrative Agent determines that
any funds held as Cash Collateral are subject to any right or claim of any
Person other than the Administrative Agent or that the total amount of such
funds is less than the aggregate Outstanding Amount of all L/C Obligations, the
Borrower will, forthwith upon demand by the Administrative Agent, pay to the
Administrative Agent, as additional funds to be deposited as Cash Collateral,
an amount equal to the excess of (x) such aggregate Outstanding Amount
over (y) the total amount of funds, if any, then held as Cash Collateral
that the Administrative Agent determines to be free and clear of any such right
and claim.  Upon the drawing of any
Letter of Credit for which funds are on deposit as Cash Collateral, such funds
shall be applied, to the extent permitted under applicable Laws, to reimburse
the L/C Issuer.

(h)           Applicability
of ISP.  Unless otherwise expressly agreed by the L/C
Issuer and the Borrower when a Letter of Credit is issued (including any such agreement
applicable to an Existing Letter of Credit),
the rules of the ISP shall apply to each standby Letter of Credit.

(i)            Letter
of Credit Fees.  The Borrower shall pay to the Administrative
Agent for the account of each Revolving Credit Lender in accordance with its
Applicable Revolving Credit Percentage a Letter of Credit fee (the “Letter
of Credit Fee”) for each Letter of Credit equal to the Applicable Rate for
Letters of Credit as listed in the table under the definition of “Applicable
Rate” times the daily amount available to be drawn under such Letter of
Credit.  For purposes of computing the
daily amount available to be drawn under any Letter of Credit, the amount of
such Letter of Credit shall be determined in accordance with Section 1.06.  Letter of Credit Fees shall be (i) due and
payable on the third Business Day after the end of each March, June, September
and December, commencing with the first such date to occur after the issuance
of such Letter of Credit, on the Letter of Credit Expiration Date and
thereafter on demand and (ii) computed on a quarterly basis in arrears.  If there is any change in the Applicable Rate
for Letters of Credit during any quarter, the daily amount available to be
drawn under each Letter of Credit shall be computed and multiplied by the
Applicable Rate separately for each period during such quarter that such
Applicable Rate was in effect. 
Notwithstanding anything to the contrary contained herein, upon the
request of the Required Revolving Lenders, while any Event of Default exists,
all Letter of Credit Fees shall accrue at the Default Rate.

(j)            Fronting
Fee and Documentary and Processing Charges Payable to L/C Issuer.  The Borrower shall
pay directly to the L/C Issuer for its own account a fronting fee at a rate separately agreed
between the Borrower and the L/C Issuer, computed on  the daily amount available to be drawn under such Letter of
Credit on a quarterly basis in arrears. 
Such fronting fee shall be due and payable on the tenth Business Day
after the end of each March, June, September and December
in respect of the most recently-ended quarterly period (or portion thereof, in
the case of the first payment), commencing with the first such date to occur
after the issuance of such Letter of Credit, on the Letter of Credit Expiration
Date and thereafter on demand.  For
purposes of computing the daily amount available to be drawn under any Letter
of Credit, the amount of such Letter of Credit shall be determined in accordance
with Section 1.06.  In addition,
the Borrower shall pay directly to the L/C Issuer for its own account the
reasonable and customary

 

47

 

issuance, presentation, amendment and
other processing fees, and other standard costs and charges, of the L/C Issuer
relating to letters of credit as from time to time in effect.  Such customary fees and standard costs and
charges are due and payable two Business Days after demand therefor and are
nonrefundable.

(k)           Conflict with
Issuer Documents.  In the event of any conflict between the
terms hereof and the terms of any Issuer Document, the terms hereof shall
control.

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

2.04         Swing Line Loans.

(a)           The
Swing Line.  Subject to the terms and conditions set forth
herein, the Swing Line Lender agrees, in reliance upon the agreements of the
Revolving Credit Lenders set forth in this Section 2.04, to make loans
(each such loan, a “Swing Line Loan”)
to the Borrower from time to time on any Business Day during the Availability
Period in an aggregate amount not to exceed at any time outstanding the amount
of the Swing Line Sublimit, notwithstanding the fact that such Swing Line
Loans, when aggregated with the Applicable Revolving Credit Percentage of the
Outstanding Amount of Revolving Credit Loans and L/C Obligations of the Lender
acting as Swing Line Lender, may exceed the amount of such Lender’s Revolving
Credit Commitment; provided, however, that after giving effect to
any Swing Line Loan, (i) the Total Revolving Credit Outstandings shall not
exceed the Revolving Credit Facility at such time, and (ii) the aggregate
Outstanding Amount of the Revolving Credit Loans of any Revolving Credit Lender
at such time, plus such Revolving Credit Lender’s Applicable Revolving
Credit Percentage of the Outstanding Amount of all L/C Obligations at such
time, plus such Revolving Credit Lender’s Applicable Revolving Credit
Percentage of the Outstanding Amount of all Swing Line Loans at such time shall
not exceed such Lender’s Revolving Credit Commitment, and provided  further
that the Borrower shall not use the proceeds of any Swing Line Loan to
refinance any outstanding Swing Line Loan. 
Within the foregoing limits, and subject to the other terms and
conditions hereof, the Borrower may borrow under this Section 2.04,
prepay under Section 2.05, and reborrow under this Section 2.04.  Each Swing Line Loan shall bear interest only
at a rate based on the Base Rate. 
Immediately upon the making of a Swing Line Loan, each Revolving Credit
Lender shall be deemed to, and hereby irrevocably and unconditionally agrees
to, purchase from the Swing Line Lender a risk participation in such Swing Line
Loan in an amount equal to the product of such Revolving Credit Lender’s
Applicable Revolving Credit Percentage times the amount of such Swing
Line Loan.

(b)           Borrowing
Procedures.  Each Swing Line Borrowing shall be made upon
the Borrower’s irrevocable notice to the Swing Line Lender and the
Administrative

 

48

 

Agent, which may be given by
telephone.  Each such notice must be
received by the Swing Line Lender and the Administrative Agent not later than
2:00 p.m. on the requested borrowing date, and shall specify (i) the amount to
be borrowed, which shall be a minimum of $100,000,
and (ii) the requested borrowing date, which shall be a Business Day.  Each such telephonic notice must be confirmed
promptly by delivery to the Swing Line Lender and the Administrative Agent of a
written Swing Line Loan Notice, appropriately completed and signed by a
Responsible Officer of the Borrower. 
Promptly after receipt by the Swing Line Lender of any telephonic Swing
Line Loan Notice, the Swing Line Lender will confirm with the Administrative
Agent (by telephone or in writing) that the Administrative Agent has also
received such Swing Line Loan Notice and, if not, the Swing Line Lender will
notify the Administrative Agent (by telephone or in writing) of the contents
thereof.  Unless the Swing Line Lender
has received notice (by telephone or in writing) from the Administrative Agent
(including at the request of any Revolving Credit Lender) prior to 3:00 p.m. on
the date of the proposed Swing Line Borrowing (A) directing the Swing Line Lender
not to make such Swing Line Loan as a result of the limitations set forth in
the first proviso to the first sentence of Section 2.04(a), or (B) that
one or more of the applicable conditions specified in Article IV is not
then satisfied, then, subject to the terms and conditions hereof, the Swing
Line Lender will, not later than 4:00 p.m. on the borrowing date specified in
such Swing Line Loan Notice, make the amount of its Swing Line Loan available
to the Borrower at its office by crediting the account of the Borrower on the books of
the Swing Line Lender in immediately available funds.

(c)           Refinancing
of Swing Line Loans.

(i)            The
Swing Line Lender at any time in its sole and absolute discretion may request,
on behalf of the Borrower (which hereby irrevocably authorizes the Swing Line
Lender to so request on its behalf), that each Revolving Credit Lender make a
Base Rate Loan in an amount equal to such Lender’s Applicable Revolving Credit
Percentage of the amount of Swing Line Loans then outstanding.  Such request shall be made in writing (which
written request shall be deemed to be a Committed Loan Notice for purposes
hereof) and in accordance with the requirements of Section 2.02, without
regard to the minimum and multiples specified therein for the principal amount
of Base Rate Loans, but subject to the unutilized portion of the Revolving
Credit Facility and the conditions set forth in Section 4.02.  The Swing Line Lender shall furnish the
Borrower with a copy of the applicable Committed Loan Notice promptly after
delivering such notice to the Administrative Agent.  Each Revolving Credit Lender shall make an
amount equal to its Applicable Revolving Credit Percentage of the amount
specified in such Committed Loan Notice available to the Administrative Agent
in immediately available funds for the account of the Swing Line Lender at the
Administrative Agent’s Office not later than 1:00 p.m. on the day specified in
such Committed Loan Notice, whereupon, subject to Section 2.04(c)(ii),
each Revolving Credit Lender that so makes funds available shall be deemed to
have made a Base Rate Loan to the Borrower in such amount.  The Administrative Agent shall remit the
funds so received to the Swing Line Lender.

 

49

 

(ii)           If for any reason
any Swing Line Loan cannot be refinanced by such a Revolving Credit  Borrowing in accordance with Section
2.04(c)(i), the request for Base Rate Loans submitted by the Swing Line
Lender as set forth herein shall be deemed to be a request by the Swing Line
Lender that each of the Revolving Credit Lenders fund its risk participation in
the relevant Swing Line Loan and each Revolving Credit Lender’s payment to the
Administrative Agent for the account of the Swing Line Lender pursuant to Section
2.04(c)(i) shall be deemed payment in respect of such participation.

(iii)          If any Revolving
Credit Lender fails to make available to the Administrative Agent for the
account of the Swing Line Lender any amount required to be paid by such Lender
pursuant to the foregoing provisions of this Section 2.04(c) by the time
specified in Section 2.04(c)(i), the Swing Line Lender shall be entitled
to recover from such Lender (acting through the Administrative Agent), on
demand, such amount with interest thereon for the period from the date such
payment is required to the date on which such payment is immediately available
to the Swing Line Lender at a rate per annum equal to the greater of the
Federal Funds Rate and a rate determined by the Swing Line Lender in accordance
with banking industry rules on interbank compensation, plus any administrative,
processing or similar fees customarily charged by the Swing Line Lender in
connection with the foregoing.  If such
Lender pays such amount (with interest and fees as aforesaid), the amount so
paid shall constitute such Lender’s Loan included in the relevant Borrowing or
funded participation in the relevant Swing Line Loan, as the case may be.  A certificate of the Swing Line Lender
submitted to any Lender (through the Administrative Agent) with respect to any
amounts owing under this clause (iii) shall be conclusive absent manifest
error.

(iv)          Each Revolving
Credit Lender’s obligation to make Revolving Credit Loans or to purchase and
fund risk participations in Swing Line Loans pursuant to this Section 2.04(c)
shall be absolute and unconditional and shall not be affected by any
circumstance, including (A) any setoff, counterclaim, recoupment, defense or
other right which such Lender may have against the Swing Line Lender, the
Borrower or any other Person for any reason whatsoever, (B) the occurrence or
continuance of a Default, or (C) any other occurrence, event or condition,
whether or not similar to any of the foregoing; provided, however,
that each Revolving Credit Lender’s obligation to make Revolving Credit Loans
pursuant to this Section 2.04(c) is subject to the conditions set
forth in Section 4.02.  No such
funding of risk participations shall relieve or otherwise impair the obligation
of the Borrower to repay Swing Line Loans, together with interest as provided
herein.

(d)           Repayment
of Participations.

(i)            At
any time after any Revolving Credit Lender has purchased and funded a risk
participation in a Swing Line Loan, if the Swing Line Lender receives any
payment on account of such Swing Line Loan, the Swing Line Lender will
distribute to such Revolving Credit Lender its Applicable Revolving

 

50

 

Credit Percentage thereof in the same funds as those received by the
Swing Line Lender.

(ii)           If any payment
received by the Swing Line Lender in respect of principal or interest on any
Swing Line Loan is required to be returned by the Swing Line Lender under any
of the circumstances described in Section 10.05 (including pursuant to
any settlement entered into by the Swing Line Lender in its discretion), each
Revolving Credit Lender shall pay to the Swing Line Lender its Applicable
Revolving Credit Percentage thereof on demand of the Administrative Agent, plus
interest thereon from the date of such demand to the date such amount is
returned, at a rate per annum equal to the Federal Funds Rate.  The Administrative Agent will make such
demand upon the request of the Swing Line Lender.  The obligations of the Lenders under this
clause shall survive the payment in full of the Obligations and the termination
of this Agreement.

(e)           Interest for
Account of Swing Line Lender.  The Swing Line Lender shall be responsible
for invoicing the Borrower for interest on the Swing Line Loans.  Until each Revolving Credit Lender funds its
Revolving Credit Loan or risk participation pursuant to this Section 2.04
to refinance such Revolving Credit Lender’s Applicable Revolving Credit
Percentage of any Swing Line Loan, interest in respect of such Applicable
Revolving Credit Percentage shall be solely for the account of the Swing Line
Lender.

(f)            Payments
Directly to Swing Line Lender.  The Borrower shall make all payments of
principal and interest in respect of the Swing Line Loans directly to the Swing
Line Lender.

2.05         Prepayments.

(a)           Optional.

(i)            Subject
to the last sentence of this Section 2.05(a)(i), the Borrower may, upon
notice to the Administrative Agent, at any time or from time to time
voluntarily prepay Term Loans, Additional Term Facility Loans and Revolving
Credit Loans in whole or in part without premium or penalty; provided
that (A) such notice must be received by the Administrative Agent not later
than 2:00 p.m. (1) three Business Days prior to any date of prepayment of
Eurodollar Rate Loans and (2) on the date of prepayment of Base Rate Loans; (B)
any prepayment of Eurodollar Rate Loans shall be in a principal amount of
$2,500,000 or a whole multiple of $500,000 in excess thereof; and (C) any
prepayment of Base Rate Loans shall be in a principal amount of $500,000 or a
whole multiple of $100,000 in excess thereof or, in each case, if less, the
entire principal amount thereof then outstanding.  Each such notice shall specify the date and
amount of such prepayment, the relevant Facility and the Type(s) of Loans to be
prepaid and, if Eurodollar Rate Loans are to be prepaid, the Interest Period(s)
of such Loans.  The Administrative Agent
will promptly notify each Lender of its receipt of each such notice, and of the
amount of such Lender’s ratable portion of such

 

51

 

prepayment (based on such Lender’s Applicable Percentage in respect of
the relevant Facility).  If such notice
is given by the Borrower, the Borrower shall make such prepayment and the payment
amount specified in such notice shall be due and payable on the date specified
therein; provided that any such notice may be conditioned on the occurrence or
non-occurrence of any event (but such conditioning shall not limit the
obligations of the Borrower under Section 3.05).  Any prepayment of a Eurodollar Rate Loan
shall be accompanied by all accrued interest on the amount prepaid, together
with any additional amounts required pursuant to Section 3.05.  Each prepayment of the outstanding Term Loans
pursuant to this Section 2.05(a) shall be applied to the principal
repayment installments thereof as directed by the Borrower, and each such
prepayment shall be paid to the Lenders in accordance with their respective
Applicable Percentages in respect of each of the relevant Facilities.

(ii)           The Borrower may,
upon notice to the Swing Line Lender (with a copy to the Administrative Agent),
at any time or from time to time, voluntarily prepay Swing Line Loans in whole
or in part without premium or penalty; provided that (A) such notice
must be received by the Swing Line Lender and the Administrative Agent not
later than 3:00 p.m. on the date of the prepayment, and (B) any such prepayment
shall be in a minimum principal amount of $50,000.  Each such notice shall specify the date and
amount of such prepayment.  If such
notice is given by the Borrower, the Borrower shall make such prepayment and
the payment amount specified in such notice shall be due and payable on the
date specified therein.

(b)           Mandatory.  The Borrower shall make mandatory prepayments
as follows:

(i)            If
on the last day of an Excess Cash Flow Period a Rating Condition exists, within
ten  Business Days after financial
statements for such Excess Cash Flow Period have been delivered pursuant to Section
6.01(a)(i) and the related Compliance Certificate has been delivered
pursuant to Section 6.02(b), the Borrower shall make a mandatory
prepayment by prepaying an aggregate principal amount of Loans equal to the
product of the applicable Excess Cash Flow Prepayment Percentage times
Excess Cash Flow for such Excess Cash Flow Period.

(ii)           If
the Borrower or any of its Restricted Subsidiaries Disposes of any property,
other than pursuant to any Excepted Disposition, which results in the
realization by such Person of Net Cash Proceeds in an amount equal to more than
$25,000,000 (or $15,000,000 if a Default has occurred and is continuing)
(whether in a single transaction or on an aggregate basis), but only if a
Rating Condition exists on the date such monetary threshold is met, the
Borrower shall make a mandatory prepayment by prepaying an aggregate principal
amount of Loans equal to 100% of such Net Cash Proceeds in excess of
$15,000,000 within five Business Days after receipt thereof by such Person; provided, however, that, with respect to any Net Cash
Proceeds realized under a Disposition described in this Section 2.05(b)(ii),
at the election of the Borrower (as notified by the

 

52

 

Borrower to the Administrative Agent on or
prior to the date of such Disposition), and so long as no Default shall have
occurred and be continuing, the Borrower or such Restricted Subsidiary may
reinvest all or any portion of such Net Cash Proceeds in assets useful in the
business of the Borrower and its Restricted Subsidiaries so long as (i) within
12 months after the receipt of such Net Cash Proceeds, the purchase shall have
been consummated (as certified by the Borrower in writing to the Administrative
Agent), or (ii) within 12 months after the receipt of such Net Cash Proceeds,
the Borrower or such Restricted Subsidiary shall have entered into a definitive
agreement to reinvest such Net Cash Proceeds in assets useful in the business
of the Borrower and its Restricted Subsidiaries, and the purchase of such
assets shall have been consummated within six months after the end of such 12
month period; and provided  further, however, that any Net
Cash Proceeds not subject to such definitive agreement or so reinvested shall
be applied to the prepayment of the Loans as set forth in this Section
2.05(b)(ii).

(iii)          Each prepayment of
Loans pursuant to the foregoing provisions of this Section 2.05(b) shall
be applied, without premium or penalty (except for amounts required under Section
3.05), first, ratably to the
principal repayment installments with respect to the Term Facility under Section
2.07(a) and any principal repayment installments with respect to each
Additional Term Loan Facility (unless the amendment or supplement to this
Agreement executed in connection with such Additional Term Loan Facility
otherwise provides), in direct order of maturity and, second, to the
Revolving Credit Facility in the manner set forth in clause (v) of this Section
2.05(b); provided that each Term Lender or Additional Term Facility
Lender may reject its portion of the mandatory prepayment with respect to the
Term Facility or Additional Term Facility, as applicable, in which event the
Borrower may retain the portion of the mandatory prepayment so rejected.

(iv)          Whether or not a
Rating Condition exists, if for any reason the Total Revolving Credit
Outstandings at any time exceed the Revolving Credit Facility at such time, the
Borrower shall immediately prepay Revolving Credit Loans, Swing Line Loans and
L/C Borrowings and/or Cash Collateralize the L/C Obligations (other than the
L/C Borrowings) in an aggregate amount equal to such excess.

(v)           Prepayments of the Revolving Credit Facility made pursuant to
this Section 2.05(b), first, shall be applied ratably to the L/C Borrowings
and the Swing Line Loans, second, shall be applied ratably to the
outstanding Revolving Credit Loans, and third, if the Cash
Collateralization of the Outstanding Amount of the L/C Obligations is then
required, but has not been effected, hereunder, to such Cash Collateralization;
and, in the case of prepayments of the Revolving Credit Facility required
pursuant to clause (i) or (ii) of this Section 2.05(b), the amount
remaining, if any, after the prepayment in full of all L/C Borrowings, Swing
Line Loans and Revolving Credit Loans outstanding at such time, may be retained
by the Borrower for use in the ordinary course of its business.  Upon the drawing of any Letter of Credit that
has been Cash Collateralized, the funds held

 

53

 

as
Cash Collateral shall be applied (without any further action by or notice to or
from the Borrower or any other Loan Party) to reimburse the L/C Issuer or the
Revolving Credit Lenders, as applicable.

2.06         Termination
or Reduction of Commitments.

(a)           Optional.  The Borrower may,
upon notice to the Administrative Agent, terminate the Revolving Credit
Facility or the Swing Line Sublimit, or from time to time permanently reduce
the Revolving Credit Facility or the Swing Line Sublimit; provided that
(i) any such notice shall be received by the Administrative Agent not later
than 2:00 p.m. three Business Days prior to the date of termination or
reduction, (ii) any such partial reduction shall be in an aggregate amount of
$5,000,000 or any whole multiple of $500,000 in excess thereof and (iii) the
Borrower shall not terminate or reduce (A) the Revolving Credit Facility if,
after giving effect thereto and to any concurrent prepayments hereunder, the
Total Revolving Credit Outstandings would exceed the Revolving Credit Facility
or (B) the Swing Line Sublimit if, after giving effect thereto and to any
concurrent prepayments hereunder, the Outstanding Amount of Swing Line Loans
would exceed the Swing Line Sublimit.

(b)           Mandatory.

(i)            The
aggregate Term Commitments shall be automatically and permanently reduced to
zero on the Closing Date after the Term Borrowing, and on the Term Increase
Effective Date after a Term Borrowing pursuant to Section 2.15.  Unless provided otherwise in the amendment or
supplement to this Agreement executed in connection with an Additional Term
Facility, the aggregate Additional Term Facility Commitments of all Additional
Term Facility Lenders under such Additional Term Facility shall be
automatically and permanently reduced to zero on the Additional Term Facility
Effective Date after the Additional Term Facility Borrowing is made on such
date.

(ii)           If
after giving effect to any reduction or termination of Revolving Credit
Commitments under this Section 2.06, the Swing Line Sublimit exceeds the
Revolving Credit Facility at such time, the Swing Line Sublimit shall be
automatically reduced by the amount of such excess.

(c)           Application
of Commitment Reductions; Payment of Fees.  The Administrative Agent will promptly notify
the Lenders of any termination or reduction of the Swing Line Sublimit or the
Revolving Credit Commitment under this Section 2.06.  Upon any reduction of the Revolving Credit
Commitments, the Revolving Credit Commitment of each Revolving Credit Lender
shall be reduced by such Lender’s Applicable Revolving Credit Percentage of
such reduction amount.  All fees in
respect of the Revolving Credit Facility accrued until the effective date of
any termination of the Revolving Credit Facility shall be paid on the effective
date of such termination.

 

54

 

2.07         Repayment
of Loans.

(a)           Term
Loans.  The Borrower shall repay to the Term Lenders
the aggregate principal amount of all Term Loans outstanding on the last Business
Day of each March, June, September and December, commencing with the first such
date to occur after the Closing Date, in equal installments in the amount equal
to 0.25% of the initial amount of the Term Loans; provided, however,
that the final principal repayment installment of the Term Loans shall be
repaid on the Maturity Date for the Term Facility and in any event shall
be in an amount equal to the aggregate principal amount of all Term Loans
outstanding on such date.

(b)           Additional
Term Facility Loans.  Subject to the provisions of this Agreement,
the Borrower shall repay to the applicable Additional Term Facility Lenders the
aggregate amount of all Additional Term Loans made under an Additional Term
Facility at such times as may be set forth in the amendment or supplement to
this Agreement executed in connection with such Additional Term Facility.

(c)           Revolving
Credit Loans.  The Borrower shall repay to the Revolving
Credit Lenders on the Maturity Date for the Revolving Credit Facility the
aggregate principal amount of all Revolving Credit Loans outstanding on such
date.

(d)           Swing Line
Loans.  The Borrower shall repay each Swing Line Loan
on the earlier to occur of (i) the date ten Business Days after such Loan is
made and (ii) the Maturity Date for the Revolving Credit Facility.

2.08         Interest.

(a)           Subject
to the provisions of Section 2.08(b), (i) each Eurodollar Rate Loan
shall bear interest on the outstanding principal amount thereof for each
Interest Period at a rate per annum equal to the Eurodollar Rate for such
Interest Period plus the Applicable Rate for the Eurodollar Rate; (ii)
each Base Rate Loan shall bear interest on the outstanding principal amount
thereof from the applicable borrowing date at a rate per annum equal to the
Base Rate plus the Applicable Rate for the Base Rate; and (iii) each
Swing Line Loan shall bear interest on the outstanding principal amount thereof
from the applicable borrowing date at a rate per annum equal to the Base Rate plus
the Applicable Rate for the Base Rate.

(b)           (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, 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.

(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

 

55

 

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 Obligations hereunder at a
fluctuating interest rate per annum at all times equal to the Default Rate to
the fullest extent permitted by applicable Laws.

(iv)          Accrued and unpaid
interest on past due amounts (including interest on past due interest) shall be
due and payable upon demand.

(c)           Interest on
each Loan shall be due and payable in arrears on each Interest Payment Date
applicable thereto and at such other times as may be specified herein.  Interest hereunder shall be due and payable
in accordance with the terms hereof before and after judgment, and before and
after the commencement of any proceeding under any Debtor Relief Law.

2.09         Fees.  In addition to certain fees described in
Sections 2.03(i) and (j):

(a)           Commitment Fee.  The
Borrower shall pay to the Administrative Agent for the account of each
Revolving Credit Lender in accordance with its Applicable Revolving Credit
Percentage, a commitment fee equal to the Applicable Rate for Commitment Fee
Rate times the actual daily amount by which the Revolving Credit
Facility exceeds the sum of (i) the Outstanding Amount of Revolving Credit
Loans and (ii) the Outstanding Amount of L/C Obligations.   The commitment 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, and shall be payable on the later of the last
Business Day of each March, June, September and December or two Business Days
after the Administrative Agent gives the Borrower notice of the amount due.

(b)           Other Fees. 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.

2.10         Computation
of Interest and Fees; Retroactive
Adjustments of Applicable Rate.

(a)           All
computations of interest for Base Rate Loans when the Base Rate is determined
by Bank of America’s “prime rate” shall be made on the basis of a year of 365
or 366 days, as the case may be, and actual days elapsed.  All other computations of fees and interest
shall be made on the basis of a 360-day year and actual days elapsed (which
results in more fees or interest, as applicable, being paid than if computed on
the basis of a 365-day year).  Interest
shall accrue on each Loan for the day on which the Loan is made, and shall not
accrue on a Loan, or any portion thereof, for the day on which the Loan or such
portion is paid, provided that any Loan that is repaid on the same day
on which it is made shall, subject to Section 2.12(a), bear interest for
one day.  Each

 

56

 

determination by the
Administrative Agent of an interest rate or fee hereunder shall be conclusive
and binding for all purposes, absent manifest error.

(b)           If, as a result of any restatement of or other
adjustment to the financial statements of the Borrower or for any other reason,
the Borrower or the Administrative Agent determines that (i) the Consolidated
Leverage Ratio as calculated by the Borrower as of any applicable date was
inaccurate and (ii) a proper calculation of the Consolidated Leverage Ratio
would have resulted in higher pricing for such period, the Borrower shall
immediately and retroactively be obligated to pay to the Administrative Agent
for the account of the applicable Lenders, within five Business Days of demand
by the Administrative Agent (or, after the occurrence of an actual or deemed
entry of an order for relief with respect to the Borrower under the Bankruptcy
Code of the United States, automatically and without further action by the
Administrative Agent, any Lender or the L/C Issuer), an amount equal to the
excess of the amount of interest and fees that should have been paid for such
period over the amount of interest and fees actually paid for such period.  This paragraph shall not limit the rights of
the Administrative Agent, any Lender or the L/C Issuer, as the case may be,
under Section 2.03(c)(iii), 2.03(i) or 2.08(b) or under Article
VIII.  The Borrower’s obligations
under this paragraph shall survive the termination of the Aggregate Commitments
and the repayment of all Obligations hereunder.

2.11         Evidence of Debt.

(a)           The
Credit Extensions made by each Lender shall be evidenced by one or more
accounts or records maintained by such Lender and by the Administrative Agent
in the ordinary course of business.  The
accounts or records maintained by the Administrative Agent and each Lender
shall be conclusive absent manifest error of the amount of the Credit Extensions
made by the Lenders to the Borrower and the interest and payments thereon.  Any failure to so record or any error in
doing so shall not, however, limit or otherwise affect the obligation of the
Borrower hereunder to pay any amount owing with respect to the
Obligations.  In the event of any
conflict between the accounts and records maintained by any 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.  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.  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.

(b)           In
addition to the accounts and records referred to in Section 2.11(a),
each Lender and the Administrative Agent shall maintain in accordance with its
usual practice accounts or records evidencing the purchases and sales by such
Lender of participations in Letters of Credit and Swing Line Loans.  In the event of any conflict between the
accounts and records maintained by the Administrative Agent and the accounts
and records of any Lender in respect of such matters, the accounts and records
of the Administrative Agent shall control in the absence of manifest error.

 

57

 

2.12         Payments Generally; Administrative
Agent’s Clawback.

(a)           General.  All payments to be
made by the Borrower shall be made without condition or deduction for any
counterclaim, defense, recoupment or setoff. 
Except as otherwise expressly provided herein, all payments by the
Borrower hereunder shall be made to the Administrative Agent, for the account
of the respective Lenders to which such payment is owed, at the Administrative
Agent’s Office in Dollars and in immediately available funds not later than
3:00 p.m. on the date specified herein. 
The Administrative Agent will promptly distribute to each Lender its
Applicable Percentage in respect of the relevant Facility (or other applicable share
as provided herein) of such payment in like funds as received by wire transfer
to such Lender’s Lending Office.  All
payments received by the Administrative Agent after 3:00 p.m. shall be
deemed received on the next succeeding Business Day and any applicable interest
or fee shall continue to accrue.  If any
payment to be made by the Borrower shall become due on a day other than a
Business Day, payment shall be made on the next following Business Day, and
such extension of time shall be reflected on computing interest or fees, as the
case may be.

(b)           (i)  Funding by
Lenders; Presumption by Administrative Agent.  Unless the Administrative Agent shall have
received notice from a Lender prior to the proposed date of any Borrowing of
Eurodollar Rate Loans (or, in the case of any Borrowing of Base Rate Loans,
prior to 2:00 p.m. on the date of such 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 Section 2.02 (or,
in the case of a Borrowing of Base Rate Loans, that such Lender has made such
share available in accordance with and at the time required by Section 2.02)
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 hereby agrees to pay to
the Administrative Agent forthwith on demand, and the Borrower agrees to pay
upon two Business Days’ notice, to the extent not made available by the
applicable Lender within two Business Days after the date of the applicable
Borrowing, such corresponding amount in immediately available funds 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 (A) in the case of a payment to be made by such
Lender, the greater of the Federal Funds 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, and (B) in the case of a payment to be made by the Borrower, the
interest rate applicable to Base Rate 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 its share of the applicable Borrowing to the Administrative Agent,
then the amount so paid shall constitute such Lender’s Loan included in such
Borrowing.  Any

 

58

 

payment by the Borrower shall be
without prejudice to any claim the Borrower may have against a Lender that
shall have failed to make such payment to the Administrative Agent.

(ii)           Payments by
Borrower; Presumptions by Administrative Agent.  Unless the Administrative Agent shall have
received notice from the Borrower prior to the time at which any payment is due
to the Administrative Agent for the account of the Lenders or the L/C Issuer
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 Appropriate Lenders or the L/C Issuer, as the case may be, the amount
due.  In such event, if the Borrower has
not in fact made such payment, then each of the Appropriate Lenders or the L/C
Issuer, as the case may be, severally agrees to repay to the Administrative
Agent forthwith on demand the amount so distributed to such Lender or the L/C
Issuer, in immediately available funds 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 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 or the Borrower with respect to any amount owing under this subsection
(b) shall be conclusive, absent manifest error.

(c)           Failure to
Satisfy Conditions Precedent.  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 Article II, and such funds are not
made available to the Borrower by the Administrative Agent because the
conditions to the applicable Credit Extension 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.

(d)           Obligations
of Lenders Several.  The obligations of the Lenders hereunder to
make Term Loans, Additional Term Facility Loans and Revolving Credit Loans, to
fund participations in Letters of Credit and Swing Line Loans and to make
payments pursuant to Section 10.04(c) are several and not joint.  The failure of any Lender to make any Loan,
to fund any such participation or to make any payment under Section 10.04(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, to
purchase its participation or to make its payment under Section 10.04(c).

(e)           Funding
Source.  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.

 

59

 

(f)            Insufficient
Funds.  If at any time insufficient funds are
received by and available to the Administrative Agent to pay fully all amounts
of principal, L/C Borrowings, interest and fees then due hereunder, such funds
shall be applied (i) first, toward payment of interest and fees then due
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of interest and fees then due to such parties, and (ii) second,
toward payment of principal and L/C Borrowings then due hereunder, ratably
among the parties entitled thereto in accordance with the amounts of principal
and L/C Borrowings then due to such parties.

2.13         Sharing of Payments by Lenders.  If any Lender shall, by exercising any right
of setoff or counterclaim or otherwise, obtain payment in respect of (a)
Obligations in respect of any of the Facilities due and payable to such Lender
hereunder and under the other Loan Documents at such time in excess of its
ratable share (according to the proportion of (i) the amount of such
Obligations due and payable to such Lender at such time to (ii) the aggregate
amount of the Obligations in respect of the Facilities due and payable to all
Lenders hereunder and under the other Loan Documents at such time) of payments
on account of the Obligations in respect of the Facilities due and payable to
all Lenders hereunder and under the other Loan Documents at such time obtained
by all the Lenders at such time or (b) Obligations in respect of any of the
Facilities owing (but not due and payable) to such Lender hereunder and under
the other Loan Documents at such time in excess of its ratable share (according
to the proportion of (i) the amount of such Obligations owing (but not due and
payable) to such Lender at such time to (ii) the aggregate amount of the
Obligations in respect of the Facilities owing (but not due and payable) to all
Lenders hereunder and under the other Loan Documents at such time) of payment
on account of the Obligations in respect of the Facilities owing (but not due
and payable) to all Lenders hereunder and under the other Loan Documents at
such time obtained by all of the Lenders at such time then the Lender receiving
such greater proportion shall (a) notify the Administrative Agent of such fact,
and (b) purchase (for cash at face value) participations in the Loans and
subparticipations in L/C Obligations and Swing Line Loans of the other Lenders,
or make such other adjustments as shall be equitable, so that the benefit of
all such payments shall be shared by the Lenders ratably in accordance with the
aggregate amount of Obligations in respect of the Facilities then due and
payable to the Lenders or owing (but not due and payable) to the Lenders, as
the case may be, provided that:

(i)            if any such participations or
subparticipations are purchased and all or any portion of the payment giving
rise thereto is recovered, such participations or subparticipations shall be
rescinded and the purchase price restored to the extent of such recovery,
without interest; and

(ii)           the provisions of this Section shall
not be construed to apply to (A) any payment made by the Borrower pursuant to
and in accordance with the express terms of this Agreement or (B) any payment
obtained by a Lender as consideration for the assignment of or sale of a
participation in any of its Loans or subparticipations in L/C Obligations or Swing
Line Loans to any assignee or participant, other than to the Borrower or any
Subsidiary thereof (as to which the provisions of this Section shall apply).

 

60

 

The Borrower consents to the foregoing
and agrees, to the extent it may effectively do so under applicable law, that
any Lender acquiring a participation pursuant to the foregoing arrangements may
exercise against the Borrower
rights of setoff 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.

2.14         Increase in Revolving Credit
Facility.

(a)           Request
for Increase.  Provided that the Borrower is in Pro Forma
Compliance, upon notice to the Administrative Agent (which shall promptly
notify the Revolving Credit Lenders), the Borrower may from time to time during
the Availability Period, request an increase in the Revolving Credit Facility; provided
that (i) any such request shall be in a minimum amount of $5,000,000, (ii) the
Borrower may make a maximum of ten such requests, and (iii) the aggregate
amount of (A) all increases of the Revolving Credit Facility under this Section
2.14 and of the Term Facility under Section 2.15 and (B) the
Additional Term Facilities under Section 2.16 shall not exceed
$100,000,000. At the time of giving such notice, the Borrower (in consultation
with the Administrative Agent) shall specify the time period within which each
Revolving Credit Lender is requested to respond (which shall in no event be
less than ten Business Days from the date of delivery of such notice to the
Revolving Credit Lenders) as to whether it elects to participate in the
requested increase.

(b)           Lender Elections to Increase.  Each
Revolving Credit Lender shall notify the Administrative Agent within such time
period whether or not it agrees to increase its Revolving Credit Commitment
and, if so, whether by an amount equal to, greater than, or less than its
Applicable Revolving Credit Percentage of such requested increase.  Any Revolving Credit Lender not responding
within such time period shall be deemed to have declined to increase its
Revolving Credit Commitment.

(c)           Notification by Administrative Agent; Additional Revolving Credit
Lenders.  The Administrative Agent shall notify the
Borrower and each Revolving Credit Lender of the Revolving Credit Lenders’
responses to each request made hereunder. 
To achieve the full amount of a requested increase, and subject to the
approval of the Administrative Agent, the L/C Issuer and the Swing Line Lender
(which approvals shall not be unreasonably withheld), the Borrower may also
invite additional Eligible Assignees to become Revolving Credit Lenders
pursuant to a joinder agreement in form and substance reasonably satisfactory
to the Administrative Agent.

(d)           Effective Date and Allocations.  If the
Revolving Credit Facility is increased in accordance with this Section, the
Administrative Agent and the Borrower shall determine the effective date (the “Revolving
Credit Increase Effective Date”)
and the final allocation of such increase. 
The Administrative Agent shall promptly notify the Borrower and the
Revolving Credit Lenders of the final allocation of such increase and the
Revolving Credit Increase Effective Date.

(e)           Conditions to Effectiveness of Increase.  As a
condition precedent to such increase, the Borrower shall deliver to the
Administrative Agent a certificate dated as of

 

61

 

the
Revolving Credit Increase Effective Date (in sufficient copies for each
Revolving Credit Lender) signed by a Responsible Officer of the Borrower (i)
certifying and attaching the resolutions adopted by the Borrower approving or
consenting to such increase, and (ii) certifying that, before and after giving
effect to such increase, (A) the representations and warranties contained in Article
V and the other Loan Documents are true and correct in all material
respects on and as of the Revolving Credit Increase Effective Date (provided
that any such representation or warranty that is qualified as to “materiality”,
“Material Adverse Effect” or similar language shall be true and correct in all
respects), except to the extent that such representations and warranties
specifically refer to an earlier date, in which case they are true and correct
in all material respects as of such earlier date (provided that any such
representation or warranty that is qualified as to “materiality”, “Material
Adverse Effect” or similar language shall be true and correct in all respects
as of such earlier date), and except that for purposes of this Section 2.14,
the representations and warranties contained in Sections 5.05(a), (b),
(c) and (d) shall be deemed to refer to the most recent
statements furnished pursuant to Sections 6.01(a)(i), (a)(ii), (b)(i)
and (b)(ii), respectively, and (B) no Default exists.  The Borrower shall prepay any outstanding
Revolving Credit Loans (and pay any additional amounts required pursuant to Section
3.05) to the extent necessary to keep the outstanding Revolving Credit
Loans ratable with any revised Applicable Revolving Credit Percentages arising
from any nonratable increase in the Revolving Credit Commitments under this
Section, such prepayment to be made on such date as the Administrative Agent
may reasonably determine after consultation with the Borrower, with a view to
minimizing any additional amounts payable pursuant to Section 3.05.

(f)            Adjustment
of Interest Rate.              If a Rating Condition exists on a
Revolving Credit Increase Effective Date and if the agreed upon interest rate
margin (which, for such purposes only, shall be deemed to include 20% of all
upfront or similar fees or original issue discount payable to all Revolving
Credit Lenders participating in such increase in the Revolving Credit Facility,
as reasonably determined by the Administrative Agent after consultation with
the Borrower) applicable to any increase in the Revolving Credit Facility
exceeds the Applicable Rate (which, for such purposes only, shall be deemed to
include 20% of all upfront or similar fees or original issue discount payable
to all Revolving Credit Lenders on the Closing Date, which shall be allocated
to the Revolving Credit Facility on a pro-rata basis) relating to the Revolving
Credit Facility by more than 0.50%, the Applicable Rate (which, for such
purposes only, shall be deemed to include 20% of all upfront or similar fees or
original issue discount payable to all Revolving Credit Lenders on the Closing
Date, which shall be allocated to the Revolving Credit Facility on a pro-rata
basis) relating to the Revolving Credit Facility shall be increased to the
applicable interest rate margin (which, for such purposes only, shall be deemed
to include 20% of all upfront or similar fees or original issue discount payable
to all Revolving Credit Lenders participating in such increase in the Revolving
Credit Facility, as reasonably determined by the Administrative Agent after
consultation with the Borrower) for such increase in the Revolving Credit
Facility minus 0.50%.

(g)           Conflicting Provisions.  This
Section shall supersede any provisions in Section 2.13 or 10.01
to the contrary.

 

62

2.15         Increase
in Term Facility.

(a)           Request
for Increase.  Provided that the Borrower is in Pro Forma
Compliance, upon notice to the Administrative Agent (which shall promptly
notify the Term  Lenders), the Borrower may from time to time before the
Maturity Date with respect to the Term Facility, request an increase in the
Term Facility; provided that (i) any such request for an increase
shall be in a minimum amount of $5,000,000, (ii) the Borrower may make a
maximum of ten such requests, and (iii) the aggregate amount of (A) all
increases of the Revolving Credit Facility under Section 2.14 and of the
Term Facility under this Section 2.15 and (B) the Additional Term
Facilities under Section 2.16 shall not exceed $100,000,000.  At the time of sending such notice, the
Borrower (in consultation with the Administrative Agent) shall specify the time
period within which each Term Lender is requested to respond (which shall
in no event be less than ten Business Days from the date of delivery of such
notice to the Term Lenders) as to whether it elects to participate in the
requested increase.

(b)           Lender Elections to Increase.  Each
Term Lender shall notify the Administrative Agent within such time period
whether or not it agrees to increase its Term  Commitment and, if so,
whether by an amount equal to, greater than, or less than its ratable portion
(based on such Term Lender’s Applicable Percentage in respect of the
Term Facility) of such requested increase. 
Any Term Lender not responding within such time period shall be
deemed to have declined to increase its Term Commitment.

(c)           Notification by Administrative Agent; Additional Term Lenders.  The Administrative Agent shall notify the
Borrower and each Term Lender of the Term Lenders’ responses to each
request made hereunder.  To achieve the
full amount of a requested increase, and subject to the approval of the
Administrative Agent (which approval shall not be unreasonably withheld), the
Borrower may also invite additional Eligible Assignees to become
Term Lenders pursuant to a joinder agreement in form and substance
reasonably satisfactory to the Administrative Agent.

(d)           Effective Date and Allocations.  If the
Term Facility is increased in accordance with this Section, the
Administrative Agent and the Borrower shall determine the effective date (the “Term
Increase Effective Date”) and the final allocation of such increase.  The Administrative Agent shall promptly
notify the Borrower and the Term Lenders of the final allocation of such
increase and the Term Increase Effective Date.  As of the Term Increase Effective Date, the
amortization schedule for the Term Loans set forth in Section 2.07(a)
shall be amended to increase the then-remaining unpaid installments of
principal by an aggregate amount equal to the additional Term Loans being made
on such date, such aggregate amount to be applied to increase such installments
ratably in accordance with the amounts in effect immediately prior to the Term
Increase Effective Date.  Such amendment
may be signed by the Administrative Agent on behalf of the Term Lenders.

(e)           Conditions to Effectiveness of Increase.  As a
condition precedent to such increase, the Borrower shall deliver to the
Administrative Agent a certificate dated as of the Term Increase Effective Date
(in sufficient copies for each Term Lender) signed by a

 

63

 

Responsible
Officer of the Borrower (i) certifying and attaching the resolutions
adopted by the Borrower approving or consenting to such increase, and
(ii) certifying that, before and after giving effect to such increase,
(A) the representations and warranties contained in Article V
and the other Loan Documents are true and correct in all material respects on
and as of the Term Increase Effective Date (provided that any such
representation or warranty that is qualified as to “materiality”, “Material
Adverse Effect” or similar language shall be true and correct in all respects),
except to the extent that such representations and warranties specifically
refer to an earlier date, in which case they are true and correct in all
material respects as of such earlier date (provided that any such
representation or warranty that is qualified as to “materiality”, “Material
Adverse Effect” or similar language shall be true and correct in all respects
as of such earlier date), and except that for purposes of this Section 2.15,
the representations and warranties contained in Sections 5.05(a), (b),
(c) and (d) shall be deemed to refer to the most recent
statements furnished pursuant to Sections 6.01(a)(i), (a)(ii), (b)(i)
and (b)(ii), respectively, and (B) no Default exists.  The additional Term Loans shall be made by
the Term Lenders participating therein pursuant to the procedures set forth in Section
2.02 and otherwise upon the terms and conditions set forth herein.

(f)            Adjustment
of Interest Rate.              If a Rating Condition exists on an
Term Increase Effective Date and if the agreed upon interest rate margin
(which, for such purposes only, shall be deemed to include 20% of all upfront
or similar fees or original issue discount payable to all Term Lenders
participating in such increase in the Term Facility, as reasonably determined
by the Administrative Agent after consultation with the Borrower) applicable to
any increase in the Term Facility exceeds the Applicable Rate (which, for such
purposes only, shall be deemed to include 20% of all upfront or similar fees or
original issue discount payable to all Term Lenders on the Closing Date, which
shall be allocated to the Term Facility on a pro-rata basis) relating to the
Term Facility by more than 0.50%, the Applicable Rate (which, for such purposes
only, shall be deemed to include 20% of all upfront or similar fees or original
issue discount payable to all Term Lenders on the Closing Date, which shall be
allocated to the Term Facility on a pro-rata basis) relating to the Term
Facility shall be increased to the applicable interest rate margin (which, for
such purposes only, shall be deemed to include 20% of all upfront or similar
fees or original issue discount payable to all Term Lenders participating in
such increase in the Term Facility, as reasonably determined by the
Administrative Agent after consultation with the Borrower) for such increase in
the Term Facility minus 0.50%.

(g)           Conflicting Provisions.  This
Section shall supersede any provisions in Section 2.13 or 10.01
to the contrary.

2.16         Additional Term
Facility.

(a)           Request
for Additional Term Facility.  Provided that the Borrower is in Pro Forma
Compliance, upon notice to the Administrative Agent (which shall promptly
notify the Lenders), the Borrower may from time to time before the Maturity
Date with respect to the Term Facility, request one or more additional term
loan facilities under this Agreement (each an “Additional Term Facility”);
provided that (i) any such Additional Term Facility shall be in a
minimum amount of $5,000,000, (ii) the Borrower may make

 

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a maximum of ten such requests,
and (iii) the aggregate amount of all increases of the Revolving Credit
Facility under Section 2.14 and the of Term Facility under Section
2.15 and of the Additional Term Facilities under this Section 2.16
shall not exceed $100,000,000.  At the
time of giving such notice, the Borrower (in consultation with the
Administrative Agent) shall specify the time period within which each Lender is
requested to respond (which shall in no event be less than ten Business Days
from the date of delivery of such notice to the Lenders) as to whether it elects
to participate in the requested Additional Term Facility.

(b)           Lender Elections.  Each
Lender shall notify the Administrative Agent within such time period whether or
not it agrees to participate in the requested Additional Term Facility and, if
so, the amount of such participation. 
Any Lender not responding within such time period shall be deemed to
have declined to participate in such Additional Term Facility.

(c)           Notification by Administrative Agent; Additional Term Lenders.  The Administrative Agent shall notify the
Borrower and each Lender of the Lenders’ responses to each request made
hereunder.  To achieve the full amount of
a requested Additional Term Facility, and subject to the approval of the
Administrative Agent (which approval shall not be unreasonably withheld), the
Borrower may also invite additional Eligible Assignees to participate in an
Additional Term Facility.

(d)           Effective Date and Allocations.  If an
Additional Term Facility is provided in accordance with this Section, the
Administrative Agent and the Borrower shall determine the effective date (the “Additional
Term Facility Effective Date”) and the final allocation of such Additional
Term Facility.  The Administrative Agent
shall promptly notify the Borrower and the lenders participating in such
Additional Term Facility (the “Additional Term Facility Lenders”) of the
final allocation of such Additional Term Facility and the Term Increase
Effective Date.

(e)           Terms of
Additional Term Facilities.
Each Additional Term Facility shall have such terms and conditions as are not
inconsistent herewith and as are set forth in an amendment or supplement to
this Agreement entered into among the Borrower, the Guarantors, the Pledgors,
the Additional Term Facility Lenders that have agreed to participate in such
Additional Term Facility and the Administrative Agent (but not any of the other
Lenders); provided, however, that (A) each Additional Term
Facility shall rank pari passu in right of payment and of security with
the other Facilities, (B) Loans made under an Additional Term Facility
shall not mature earlier than the Maturity Date with respect to the Term
Facility and shall have a Weighted Average Life to Maturity no shorter than the
Weighted Average Life to Maturity of the Term Facility, (C) each
Additional Term Facility shall be treated substantially the same as (and in any
event, no more favorably than) the Term Facility (in each case, including with
respect to mandatory and voluntary prepayments) and (D) each Additional
Term Facility will accrue interest at rates determined by the Borrower, the
applicable Additional Term Facility Lenders and the Administrative Agent, which
rates may be higher or lower than the rates applicable to the Term Loans; provided
that (i) if a Rating Condition exists on an applicable Additional Term
Facility Effective Date and if the agreed upon interest rate margin (which, for
such

 

65

 

purposes only, shall be deemed to
include 20% of all upfront or similar fees or original issue discount payable
to all applicable Additional Term Facility Lenders, as reasonably determined by
the Administrative Agent after consultation with the Borrower) applicable to
any Additional Term Facility exceeds the Applicable Rate (which, for such purposes
only, shall be deemed to include 20% of all upfront or similar fees or original
issue discount payable to all Term Lenders on the Closing Date, which shall be
allocated to the Term Facility on a pro-rata basis) relating to the Term
Facility by more than 0.50%, the Applicable Rate (which, for such purposes
only, shall be deemed to include 20% of all upfront or similar fees or original
issue discount payable to all Term Lenders on the Closing Date, which shall be
allocated to the Term Facility on a pro-rata basis) relating to the Term
Facility shall be increased to the applicable interest rate margin (which, for
such purposes only, shall be deemed to include 20% of all upfront or similar
fees or original issue discount payable to all applicable Additional Term
Facility Lenders, as reasonably determined by the Administrative Agent after
consultation with the Borrower) for such Additional Term Facility minus
0.50%.

(f)            Conflicting
Provisions.  This Section shall supersede any provisions
in Section 2.13 or 10.01 to the contrary.

ARTICLE III

TAXES, YIELD PROTECTION AND ILLEGALITY

3.01         Taxes.

(a)           Payments
Free of Taxes.  Any and all payments by or on account of any
obligation of the Borrower hereunder or under any other Loan Document shall be
made free and clear of and without reduction or withholding for any Indemnified
Taxes or Other Taxes, provided that if the Borrower shall be required by
applicable law to deduct any Indemnified Taxes (including any 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, any
Lender or the L/C Issuer, 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 timely pay the full
amount deducted to the relevant Governmental Authority in accordance with
applicable law.

(b)           Payment of
Other Taxes by the Borrower.  Without limiting the provisions of subsection
(a) above, the Borrower shall timely pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable law.

(c)           Indemnification
by the Borrower.  The Borrower shall indemnify the
Administrative Agent, each Lender and the L/C Issuer, within ten Business Days
after 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, such Lender or the L/C Issuer, as the case may be, and any penalties,
interest and reasonable expenses arising

 

66

 

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.  A reasonably detailed certificate as to the
amount of such payment or liability delivered to the Borrower by a Lender or
the L/C Issuer (with a copy to the Administrative Agent), or by the
Administrative Agent on its own behalf or on behalf of a Lender or the L/C
Issuer, shall be conclusive absent manifest error.

(d)           Evidence of Payments.  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)           Status of
Lenders.  Any Foreign Lender that is entitled to an
exemption from or reduction of withholding tax under the law of the
jurisdiction in which the Borrower is resident for tax purposes, or any treaty
to which such jurisdiction is a party, or otherwise, with respect to payments
hereunder or under any other Loan Document shall deliver to the Borrower (with
a copy to the Administrative Agent), at the time or times prescribed by
applicable law or reasonably requested by the Borrower or the Administrative
Agent, such properly completed and executed documentation prescribed by applicable
law as will permit such payments to be made without withholding or at a reduced
rate of withholding.  In addition, any
Lender, if requested by the Borrower or the Administrative Agent, shall deliver
such other documentation prescribed by applicable law or reasonably requested
by the Borrower or the Administrative Agent as will enable the Borrower or the
Administrative Agent to determine whether or not such Lender is subject to
backup withholding or information reporting requirements.

Without limiting the generality of the
foregoing, if the Borrower is resident for tax purposes in the United States,
any Foreign Lender 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 obsolescence or 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)            duly
completed copies 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)           duly
completed copies of Internal Revenue Service Form W-8ECI,

(iii)          in
the case of a Foreign Lender claiming the benefits of the exemption for
portfolio interest under section 881(c) of the Code, (A) a certificate to the
effect that such Foreign Lender is not (1) a “bank” within the meaning of
section 881(c)(3)(A) of the Code, (2) a “10 percent shareholder” of the
Borrower within the meaning of section 881(c)(3)(B) of the Code, or (3) a “controlled

 

67

 

foreign corporation” described in section 881(c)(3)(C) of the Code and
(B) duly completed copies of  Internal
Revenue Service Form W-8BEN, or

(iv)          any
other form prescribed by applicable law as a basis for claiming exemption from
or a reduction in United States Federal withholding tax duly completed together
with such supplementary documentation as may be prescribed by applicable law to
permit the Borrower to determine the withholding or deduction required to be
made.

(f)            Treatment
of Certain Refunds.  If
the Borrower reasonably believes that any Indemnified Taxes or Other Taxes (as
the case may be), as to which the Administrative Agent, any Lender or the L/C
Issuer has been indemnified by the Borrower or with respect to which the
Borrower has paid additional amounts pursuant to this Section 3.01, were
not correctly or legally asserted, the Administrative Agent, such Lender or the
L/C Issuer (as the case may be) will use commercially reasonable efforts to
cooperate with the Borrower to obtain a refund of such Indemnified Taxes or
Other Taxes (as the case may be) at the sole expense of the Borrower and so
long as the Administrative Agent, such Lender or the L/C Issuer (as the case
may be) would not be adversely affected by such cooperation. If the Administrative Agent, any Lender or the L/C Issuer
determines that it has received a refund of any 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 reasonable out-of-pocket expenses of the Administrative Agent, such
Lender or the L/C Issuer, 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 Agent, such Lender or the L/C Issuer, 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,
such Lender or the L/C Issuer if the Administrative Agent, such Lender or the
L/C Issuer is required to repay such refund to such Governmental
Authority.  This subsection shall not be
construed to require the Administrative Agent, any Lender or the L/C Issuer 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.

3.02         Illegality.  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 Rate Loans, or to determine or charge interest rates based upon
the Eurodollar 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 Rate Loans or to convert Base Rate
Loans to Eurodollar Rate 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

 

68

 

demand from
such Lender (with a copy to the Administrative Agent), either prepay or convert
all such Eurodollar Rate Loans of such Lender to Base Rate Loans, either on the
last day of the Interest Period therefor, if such Lender may lawfully continue
to maintain such Eurodollar Rate Loans to such day, or immediately, if such
Lender may not lawfully continue to maintain such Eurodollar Rate Loans.  Upon any such prepayment or conversion, the
Borrower shall also pay accrued interest on the amount so prepaid or converted.

3.03         Inability to Determine Rates.  If the Required Lenders determine that for
any reason in connection with any request for a Eurodollar Rate Loan or a
conversion to or continuation thereof 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 Rate Loan, (b) adequate and
reasonable means do not exist for determining the Eurodollar Rate for any
requested Interest Period with respect to a proposed Eurodollar Rate Loan, or
(c) the Eurodollar Rate for any requested Interest Period with respect to a
proposed Eurodollar Rate Loan does not adequately and fairly reflect the cost
to such Lenders of funding such Loan, the Administrative Agent will promptly so
notify the Borrower and each Lender. 
Thereafter, the obligation of the Lenders to make or maintain Eurodollar
Rate Loans shall be suspended until the Administrative Agent (upon the instruction
of the Required Lenders) revokes such notice. 
Upon receipt of such notice, the Borrower may revoke any pending request
for a Borrowing of, conversion to or continuation of Eurodollar Rate Loans or,
failing that, will be deemed to have converted such request into a request for
a Borrowing of Base Rate Loans in the amount specified therein.

3.04         Increased
Costs.

(a)           Increased
Costs Generally.  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 or for
the account of, or credit extended or participated in by, any Lender (except
any reserve requirement that is reflected in the Eurodollar Rate) or the L/C
Issuer;

(ii)           subject
any Lender or the L/C Issuer to any tax of any kind whatsoever with respect to
this Agreement, any Letter of Credit, any participation in a Letter of Credit
or any Eurodollar Rate Loan made by it, or change the basis of taxation of
payments to such Lender or the L/C Issuer in respect thereof (except for
Indemnified Taxes or Other Taxes covered by Section 3.01 and the
imposition of, or any change in the rate of, any Excluded Tax); or

(iii)          impose
on any Lender or the L/C Issuer or the London interbank market any other
condition, cost or expense affecting this Agreement or Eurodollar Rate Loans
made by such Lender or any Letter of Credit or participation therein;

and the result of any of the foregoing shall
be to increase the cost to such Lender of making or maintaining any Eurodollar
Rate Loan (or of maintaining its

 

69

 

obligation to make any such Loan), or to
increase the cost to such Lender or the L/C Issuer of participating in, issuing
or maintaining any Letter of Credit (or of maintaining its obligation to
participate in or to issue any Letter of Credit), or to reduce the amount of
any sum received or receivable by such Lender or the L/C Issuer hereunder
(whether of principal, interest or any other amount) by an amount deemed in
good faith by such Lender or the L/C Issuer to be material, then, upon request
of such Lender or the L/C Issuer, the Borrower will pay to such Lender or the
L/C Issuer, as the case may be, pursuant to Section 3.04(c), such
additional amount or amounts as will compensate such Lender or the L/C Issuer,
as the case may be, for such additional costs incurred or reduction
suffered.  Notwithstanding the foregoing
provisions of this Section 3.04(a), the obligations of the Borrower
in respect of Indemnified Taxes and Other Taxes shall be governed by Section 3.01.

(b)           Capital
Requirements.  If any Lender or the L/C Issuer determines in
good faith that any Change in Law affecting such Lender or the L/C Issuer or
any Lending Office of such Lender or such Lender’s or the L/C Issuer’s holding
company, if any, regarding capital requirements has or would have the effect of
reducing the rate of return on such Lender’s or the L/C Issuer’s capital or on
the capital of such Lender’s or the L/C Issuer’s holding company, if any, as a
consequence of this Agreement, the Commitments of such Lender or the Loans made
by, or participations in Letters of Credit held by, such Lender, or the Letters
of Credit issued by the L/C Issuer, to a level materially below that which such
Lender or the L/C Issuer or such Lender’s or the L/C Issuer’s holding company
could have achieved but for such Change in Law (taking into consideration such
Lender’s or the L/C Issuer’s policies and the policies of such Lender’s or the
L/C Issuer’s holding company with respect to capital adequacy), then from time
to time the Borrower will pay to such Lender or the L/C Issuer, as the case may
be, pursuant to Section 3.04(c), such additional amount or amounts as
will compensate such Lender or the L/C Issuer or such Lender’s or the L/C
Issuer’s holding company for any such reduction suffered.

(c)           Certificates
for Reimbursement.  A certificate of a Lender or the L/C Issuer
setting forth in reasonable detail a calculation of the amount or amounts necessary
to compensate such Lender or the L/C Issuer or its holding company, as the case
may be, as specified in subsection (a) or (b) of this Section and delivered to
the Borrower shall be conclusive absent manifest error.  The Borrower shall pay such Lender or the L/C
Issuer, as the case may be, the amount shown as due on any such certificate
within ten Business Days after receipt thereof.

(d)           Delay in
Requests.  Failure or delay on the part of any Lender or
the L/C Issuer to demand compensation pursuant to the foregoing provisions of
this Section shall not constitute a waiver of such Lender’s or the L/C Issuer’s

 

70

 

right to demand such compensation, provided
that the Borrower shall not be required to compensate a Lender or the L/C
Issuer pursuant to the foregoing provisions of this Section for any increased
costs incurred or reductions suffered more than six months prior to the date
that such Lender or the L/C Issuer, as the case may be, notifies the Borrower
of the Change in Law giving rise to such increased costs or reductions and of
such Lender’s or the L/C Issuer’s intention to claim compensation therefor
(except 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).  

(e)           Reserves on
Eurodollar Rate Loans.  The Borrower shall pay to each Lender, as
long as such Lender shall be required to maintain reserves with respect to
liabilities or assets consisting of or including Eurocurrency funds or deposits
(currently known as “Eurocurrency liabilities”), additional interest on the
unpaid principal amount of each Eurodollar Rate Loan equal to the actual costs
of such reserves allocated to such Loan by such Lender (as determined by such
Lender in good faith), which shall be due and payable on each date on which
interest is payable on such Loan, provided the Borrower shall have
received at least ten Business Days’ prior notice (with a copy to the
Administrative Agent) of such additional interest from such Lender, which
notice shall include in reasonable detail the calculation thereof.  If a Lender fails to give notice ten Business
Days prior to the relevant Interest Payment Date, such additional interest
shall be due and payable ten Business Days from receipt of such notice.

3.05         Compensation for Losses.  Upon demand of any Lender (with a copy to the
Administrative Agent) from time to time, the Borrower shall  within ten Business Days compensate such
Lender for and hold such Lender harmless from any reasonably documented loss,
cost or expense incurred by it as a result of:

(a)           any continuation,
conversion, payment or prepayment of any
Loan other than a Base Rate Loan on a day other than the last day of the
Interest Period for such Loan (whether voluntary, mandatory, automatic, by
reason of acceleration, or otherwise);

(b)           any failure by the
Borrower (for a reason other than the failure of such Lender to make a Loan) to
prepay, borrow, continue or convert any Loan other than a Base Rate Loan on the
date or in the amount notified by the Borrower; or

(c)           any assignment of a
Eurodollar Rate Loan on a day other than the last day of the Interest Period
therefor as a result of a request by the Borrower pursuant to Section 10.13;

including any loss or expense arising from the liquidation or
reemployment of funds obtained by it to maintain such Loan or from fees payable
to terminate the deposits from which such funds were obtained.  The
Borrower shall also pay any reasonable and customary administrative fees
charged by such Lender in connection with the foregoing.

For purposes of calculating amounts payable by the Borrower to the
Lenders under this Section 3.05, each Lender shall be deemed to have funded each Eurodollar Rate Loan
made by it at the Eurodollar Rate
for such Loan by a matching deposit or other borrowing in the London interbank
eurodollar market for a comparable amount and for a comparable period, whether
or not such Eurodollar Rate Loan was in fact so funded.

3.06         Mitigation Obligations; Replacement
of Lenders.

 

71

 

(a)           Designation
of a Different Lending Office.  If any Lender requests compensation under Section
3.04, or 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 3.01,
or if any Lender gives a notice pursuant to Section 3.02, 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 3.01 or 3.04, as the
case may be, in the future, or eliminate the need for the notice pursuant to Section
3.02, as applicable, and (ii) in each case, would not subject such Lender
to any unreimbursed cost or expense and would not otherwise be disadvantageous
to such Lender.  The Borrower hereby
agrees to pay all reasonable and reasonably documented costs and expenses
incurred by any Lender in connection with any such designation or assignment.

(b)           Replacement
of Lenders.  If any Lender requests compensation under Section
3.04, 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
3.01, the Borrower may replace such Lender in accordance with Section
10.13.

3.07         Survival.  All of the Borrower’s obligations under this
Article III shall survive termination of the Aggregate Commitments and
repayment of all other Obligations hereunder.

ARTICLE IV

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

4.01         Conditions of Initial Credit
Extension.  The obligation of the L/C
Issuer and each Lender to make its initial Credit Extension hereunder is
subject to satisfaction of the following conditions precedent:

(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 Responsible Officer of the signing Loan
Party, 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 reasonably satisfactory to the Administrative Agent and each of
the Lenders:

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

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

(iii)          a Pledge Agreement,
in substantially the form of Exhibit G (together with each other
pledge agreement and pledge agreement supplement delivered pursuant to Section 6.12,
the “Pledge Agreement”), duly
executed by the Borrower and each issuer of Equity Interests subject thereto,
together with:

 

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(A)          if
a Rating Condition then exists, certificates representing the certificated
Collateral referred to therein accompanied
by undated stock powers executed in blank, and

(B)           if
a Rating Condition then exists, evidence of the completion of all other
actions, recordings and filings of or with respect to the Pledge Agreement that
the Administrative Agent may deem necessary or desirable in order to perfect
the Liens created thereby;

(iv)          such certificates of
resolutions or other action, incumbency certificates and/or other certificates
of Responsible Officers of each Loan Party (or the Borrower on behalf of each
Loan Party) as the Administrative Agent may reasonably require evidencing the
identity, authority and capacity of each Responsible Officer thereof authorized
to act as a Responsible Officer in connection with this Agreement and the other
Loan Documents to which such Loan Party is a party or is to be a party;

(v)           such documents and
certifications as the Administrative Agent may reasonably require to evidence
that each Loan Party is duly organized or formed, and that each Loan Party is validly existing, in good standing and qualified
to engage in business in each jurisdiction
where its ownership, lease or operation of properties or the conduct of its
business requires such qualification, except to the extent that failure to do
so could not reasonably be expected to have a Material Adverse Effect;

(vi)          a favorable opinion
of Dechert LLP, counsel to the Loan Parties, addressed to the Administrative
Agent and each Lender, as to the matters set forth in Exhibit H and such
other matters concerning the Loan Parties and the Loan Documents as the
Administrative Agent may reasonably request;

(vii)         [Intentionally
Omitted];

(viii)        a certificate signed
by a Responsible Officer of the Borrower certifying (A) that the conditions
specified in Sections 4.02(a) and (b) have been satisfied, (B) that there has been no event or circumstance since
December 31, 2006 that has had or would be reasonably expected to have,
either individually or in the aggregate, a Material Adverse Effect, (C) a calculation of the Consolidated Leverage Ratio as of the Closing Date
and after giving pro forma effect to the Transactions, which Consolidated
Leverage Ratio shall not be greater than 3.25:1.00 and (D) that the Acquisition
Agreement is in full force and effect and that no material default or event of
default exists thereunder;

(ix)           (i) at least 20
Business Days prior to the Closing Date, the Audited Financial Statements
of the Borrower and the audited balance sheets of the Acquired Business for the
fiscal years ended December 31, 2004, December 31, 2005 and December 31,
2006, and the audited consolidated statements of income or operations,
shareholders’ equity and cash flows for such fiscal years of the

 

73

 

Acquired
Business, including the notes thereto and (ii) at least five Business Days
prior to the Closing Date, unaudited financial statements for any interim
period or periods of the Borrower and the Acquired Business ended at least 45
days prior to the Closing Date, as well as the pro forma financial statements
of the Borrower described in Section 5.05(f);

(x)            a certificate
attesting to the Solvency of each of the Borrower and the Borrower and its
Subsidiaries, taken as a whole, before and after giving effect to the
Transactions, executed by the chief financial officer of the Borrower;

(xi)           copies of the
Acquisition Agreement, including the Escrow Documents, duly executed by the
parties thereto, together with all agreements, instruments and other documents
delivered in connection therewith as the Administrative Agent shall reasonably
request;

(xii)          a
duly completed Compliance Certificate as of March 31, 2007, giving pro forma
effect to the Transactions, executed by the chief financial officer of the
Borrower; and

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

(b)           (i)
All fees required to be paid to the Administrative Agent and the Arranger on or
before the Closing Date shall have been paid and (ii) all fees required to be
paid to the Lenders on or before the Closing Date shall have been paid.

(c)           Unless
waived by the Administrative Agent, the Borrower shall have paid all reasonable
fees, charges and disbursements of counsel to the Administrative Agent
(directly to such counsel if requested by the Administrative Agent) to the
extent invoiced in reasonable detail prior to or on the Closing Date, plus
such additional amounts of such fees, charges and disbursements as shall
constitute its reasonable estimate of such fees, charges and disbursements
incurred or to be incurred by it through the closing proceedings (provided
that such estimate shall not thereafter preclude a final settling of accounts
between the Borrower and the Administrative Agent).

(d)           Qualified Equity Interests
shall have been issued by the Borrower and the proceeds thereof, together with
the proceeds from the Borrowings made on the Closing Date pursuant to the Term
Facility and the Revolving Credit Facility, shall be sufficient to consummate
the Acquisition and the Refinancing and to pay related fees, commissions and
expenses, and the proceeds of the issuance of such Qualifying Equity Interests
shall have been delivered to the escrow agent under the escrow agreement that
is part of the Escrow Documents.

(e)           [Intentionally Omitted].

(f)            [Intentionally Omitted].

 

74

 

(g)           After giving effect to the
Transactions to be effected on the Closing Date, there shall not exist any
material default or event of default under any other material Indebtedness of
the Borrower or any of its Restricted Subsidiaries to remain outstanding after
the consummation of such Transactions.

(h)           The Refinancing of the
Indebtedness and obligations under the agreements described in clauses (a) and
(b) of the definition of Existing Credit Agreements shall have been
consummated, all commitments relating thereto shall have been terminated, and
all liens or security interests (other than any liens or security interests
permitted under the Loan Documents) related thereto shall have been terminated
or released, in each case on terms reasonably satisfactory to the Administrative
Agent.

(i)            [Intentionally Omitted].

(j)            The
Borrower shall have used commercially reasonable efforts to obtain a corporate
rating by S&P.

(k)           The Closing Date shall have occurred on or before February 10, 2008.

Notwithstanding the foregoing, the conditions provided in Section
4.01(a)(iii) shall be deemed satisfied if such conditions are not satisfied
on the Closing Date after commercially reasonable effort by the Borrower, provided
that such conditions shall be satisfied within 15 Business Days after the Closing
Date; and provided, further, that such conditions shall be deemed
to be conditions to Credit Extensions under Section 4.02 to the extent
that they are not satisfied within 15 Business Days after the Closing Date.
Without limiting the generality of the provisions of the last paragraph of Section
9.03, 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.

4.02         Conditions to all Credit Extensions.  The obligation of each Lender to honor any
Request for Credit Extension (other than a Committed Loan Notice requesting
only a conversion of Loans to the other Type, or a continuation of Eurodollar
Rate Loans) is subject to the following conditions precedent:

(a)           The representations and warranties of
the Borrower contained in Article V or any other Loan Document shall be
true and correct in all material respects on and as of the date of such Credit
Extension (provided that any such representation and warranty that is
qualified as to “materiality”, “Material Adverse Effect” or similar language
shall be true and correct in all respects), except to the extent that such
representations and warranties specifically refer to an earlier date, in which
case they shall be true and correct in all material respects as of such earlier
date (provided that any such representation and warranty that is
qualified as to “materiality”, “Material Adverse Effect” or similar language
shall be true and correct in all respects as of such earlier date), and except
that for purposes of this Section 4.02, the representations and
warranties contained in

 

75

 

Sections 5.05(a), (b), (c) and (d) shall be deemed to
refer to the most recent statements furnished pursuant to Sections
6.01(a)(i), (a)(ii), (b)(i) and (b)(ii), respectively,
and except that, to the extent such representations and warranties relate to
the Acquired Business and are given at any time or with respect to any period
prior to the initial Credit Extension hereunder, such representations and
warranties shall be limited to those set forth in Section 5.01
(excluding clause (c) thereof), the matters set forth before the first
comma in Section 5.02, Section 5.04, Section 5.14,
Section 5.18 and Section 5.19.

(b)           No
Default shall exist, or would exist after such proposed Credit Extension and
the application of the proceeds thereof.

(c)           The
Administrative Agent and, if applicable, the L/C Issuer or the Swing Line
Lender shall have received a Request for Credit Extension in accordance with
the requirements hereof.

Each Request for Credit Extension (other than a Committed Loan Notice
requesting only a conversion of Loans to the other Type or a continuation of
Eurodollar Rate Loans) submitted by the Borrower shall be deemed to be a
representation and warranty that the conditions specified in Sections
4.02(a) and (b) have been satisfied or waived on and as of the date of the
applicable Credit Extension.

ARTICLE V

REPRESENTATIONS AND WARRANTIES

The Borrower represents and warrants to
the Administrative Agent and the Lenders that:

5.01         Existence, Qualification and Power.  Each of the Borrower and its Restricted
Subsidiaries (a) is duly organized or formed, validly existing and, as
applicable, in good standing under the Laws of the jurisdiction of its
incorporation or organization, (b) has all requisite, corporate or other
organizational power and authority and all requisite governmental licenses,
authorizations, consents and approvals to (i) own or lease its assets and carry
on its business and (ii) execute, deliver and perform its obligations under the
Loan Documents to which it is a party and consummate the Transactions to which
it is a party, and (c) is duly qualified and is licensed and, as applicable, in
good standing under the Laws of each jurisdiction where its ownership, lease or
operation of properties or the conduct of its business requires such
qualification or license; except in each case referred to in clause (b)(i) or
(c), to the extent that failure to do so could not reasonably be expected to
have a Material Adverse Effect.

5.02         Authorization; No Contravention.  The execution, delivery and performance by
each Loan Party of each Loan Document to which it is a party have been duly
authorized by all necessary corporate or other organizational action, and do
not and will not (a) contravene the terms of any of such Person’s Organization
Documents; (b) conflict with or result in any breach or contravention of, or
the creation of any Lien under, or require any payment to be made under (i) any
Contractual Obligation to which such Person is a party or affecting such Person
or the properties of such Person or (ii) any order, injunction, writ or decree
of any Governmental Authority or any arbitral award to which such Person or its
property is subject; or (c) violate any Law, except, in each case referred to
in clauses (b) and (c), to the extent that such conflict,

 

76

 

breach, Lien,
payment or violation could not reasonably be expected to have a Material
Adverse Effect.

5.03         Governmental Authorization; Other
Consents.  No approval, consent,
exemption, authorization, or other action by, or notice to, or filing with, any
Governmental Authority or any other Person is necessary or required in
connection with (a) the execution, delivery or performance by, or enforcement
against, any Loan Party of this Agreement or any other Loan Document to which
it is a party, for the consummation of the Transactions or for the Credit
Extensions under this Agreement, (b) the grant by any Loan Party of the
Liens granted by it pursuant to the Collateral Documents, (c) the
perfection or maintenance of the Liens created under the Collateral Documents
(including the first priority nature thereof) or (d) the exercise by the
Administrative Agent or any Lender of its rights under the Loan Documents or
the remedies in respect of the Collateral pursuant to the Collateral Documents,
which have not been or will not be duly and timely obtained, taken, given or
made and are or will be in full force and effect, or the failure of which to
obtain, take, give, make or be in full force and effect could not reasonably be
expected to have a Material Adverse Effect. 
All applicable waiting periods in connection with the Transactions have
expired without any action having been taken by any Governmental Authority
restraining, preventing or imposing materially adverse conditions upon the
Transactions or the rights of any Loan Party freely to transfer or otherwise
dispose of, or to create any Lien on, any properties now owned or hereafter
acquired by any of them.

5.04         Binding Effect; Seniority.  This Agreement has been, and each other Loan
Document, when delivered hereunder, will have been, duly executed and delivered
by each Loan Party that is party thereto. 
This Agreement constitutes, and each other Loan Document when so
delivered will constitute, a legal, valid and binding obligation of such Loan
Party, enforceable against each Loan Party that is party thereto in accordance
with its terms.  The Obligations are not
subordinated in right of payment under any Contractual Obligation to any other
Indebtedness of any Loan Party.

5.05         Financial Statements; No Material
Adverse Effect.

(a)           The
Audited Financial Statements (i) were prepared in accordance with GAAP
consistently applied throughout the period covered thereby, except as otherwise
expressly noted therein; and (ii) fairly present in all material respects
the financial condition of the Borrower and its Subsidiaries as of the dates
thereof and their results of operations for the periods covered thereby in
accordance with GAAP consistently applied throughout the periods covered thereby,
except as otherwise expressly noted therein.

(b)           The Annual
Statement of each Regulated Insurance Company for the annual period ended most
recently prior to the Closing Date, heretofore filed with the Applicable
Insurance Regulatory Authority and delivered to the Administrative Agent and
the Lenders, was prepared in accordance with SAP and fairly presents in all
material respects the financial condition of such Person at the date thereof
and the results of operations for the period covered thereby in accordance with
SAP.

(c)           The
unaudited consolidated and consolidating
balance sheet of the Borrower and its
Subsidiaries as of the last day  of the
fiscal quarter ended most recently

 

77

 

prior to the Closing Date, and
the related consolidated and consolidating
statements of income or operations, shareholders’ equity and cash flows for the
fiscal quarter ended on that date, (i) were prepared in accordance with GAAP
consistently applied throughout the period covered thereby (subject to normal
year-end adjustments), except as otherwise expressly noted therein, and (ii)
fairly present in all material respects the financial condition of the Borrower and its Subsidiaries as of the date thereof and their
results of operations for the period covered thereby, subject, in the case of
clauses (i) and (ii), to the absence of footnotes and to normal year-end audit
adjustments.

(d)           The quarterly
statement of each Regulated Insurance Company for the quarterly period ended
most recently prior to the Closing Date, heretofore filed with the Applicable
Insurance Regulatory Authority and delivered to the Administrative Agent and
the Lenders, was prepared in accordance with SAP and fairly presents in all
material respects the financial condition of such Person at the date thereof
and the results of operations for the period covered thereby in accordance with
SAP.

(e)           (i) As of the
Closing Date, since December 31, 2006, there has been no event or
circumstance, either individually or in the aggregate, that has had or would
reasonably be expected to have a Material Adverse Effect and (ii) as of any
time after the Closing Date, since December 31, 2006, there has been no event
or circumstance, either individually or in the aggregate, that has had or could
reasonably be expected to have a Material Adverse Effect.

(f)            The
consolidated pro forma balance sheet of the Borrower
and its Subsidiaries as of March 31, 2007, and the related consolidated and consolidating pro forma statements of income and cash flows of the
Borrower and its Subsidiaries for the fiscal quarter then ended, heretofore
delivered to the Administrative Agent and the Lenders, fairly present the
consolidated pro forma financial condition of the Borrower
and its Subsidiaries as at such date and the consolidated and consolidating pro forma results of operations of the Borrower and its Subsidiaries for the period ended on such date, in
each case giving effect to the Transactions, all in accordance with GAAP
(subject to normal year-end adjustments).

(g)           The
consolidated forecasted balance sheet, and the related consolidated and
consolidating forecasted statements of income and cash flows of the Borrower and its Subsidiaries dated June 2007, heretofore delivered
to the Administrative Agent and the Lenders, were prepared in good faith on the
basis of the assumptions stated therein, which assumptions were reasonable in
light of the conditions existing at the time of delivery of such forecasts, and
represented, at the time of delivery, the Borrower’s reasonable best estimate
of their future financial condition and performance.

5.06         Litigation.  There are no actions, suits, proceedings,
claims or disputes pending or, to the knowledge of the Borrower, threatened, at
law, in equity, in arbitration or before any Governmental Authority, by or
against the Borrower or any of its Restricted Subsidiaries or against any of
their properties or revenues that (a) except as specifically set forth on
Schedule 5.06(a), purport to affect or pertain to this Agreement, any other
Loan Document, the Acquisition Agreement or the consummation of the
Transactions, or (b) except as specifically disclosed in

 

78

 

Schedule
5.06(b), either individually or in the aggregate, in each case, if determined
adversely, could reasonably be expected to have a Material Adverse Effect, and
there has been no materially adverse change in the status, or financial effect
on the Borrower or any of its Restricted Subsidiaries, of the matters disclosed
in Schedule 5.06(b).

5.07         No Default.  Neither the Borrower nor any of its
Restricted Subsidiaries is in default under or with respect to any Contractual
Obligation that could, either individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect. 
No Default has occurred and is continuing and no Event of Default would
result from the consummation of the Transactions.

5.08         Ownership of Property; Liens.

(a)           Each
of the Borrower and its Restricted Subsidiaries has good record and marketable
title in fee simple to, or valid leasehold interests in, all real property used
in the ordinary conduct of its business, except for such defects in title as
could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.

(b)           Schedule 5.08(b) sets forth a complete and accurate list of all Liens on the
property or assets of the Borrower and each of its Restricted Subsidiaries as
of the date hereof, in each case securing Indebtedness exceeding $5,000,000 in
aggregate principal amount, showing the lienholder thereof, the principal
amount of the obligations secured thereby and the property or assets of the
Borrower or such Restricted Subsidiary subject thereto.  The property of each of the Borrower and its
Restricted Subsidiaries is subject to no Liens, other than Liens set forth on Schedule
5.08(b), and as otherwise permitted by Section 7.01.

5.09         Environmental Compliance.

(a)           Each
of the Borrower and its Restricted Subsidiaries conducts in the ordinary course
of business a review of the effect of existing Environmental Laws and claims
alleging potential liability or responsibility for violation of any
Environmental Law on its businesses, operations and properties, and as a result
thereof the Borrower has reasonably concluded that, except as specifically
disclosed in Schedule 5.09, such Environmental Laws and claims could
not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.

(b)           Except as otherwise set forth on Schedule 5.09, neither the
Borrower nor any of its Restricted Subsidiaries is undertaking, either
individually or together with other potentially responsible parties, any
material pending, unresolved investigation or assessment or remedial or
response action relating to any actual or threatened release, discharge or
disposal of Hazardous Materials at any site, location or operation, either
voluntarily or pursuant to the order of any Governmental Authority or the
requirements of any Environmental Law; and all Hazardous Materials generated,
used, treated, handled or stored at, or transported to or from, any property
currently or formerly owned or

 

79

 

operated by
the Borrower or any of its Restricted Subsidiaries have been disposed of in a
manner that could not reasonably be expected to have a Material Adverse Effect.

5.10         Insurance.  The properties of the Borrower and its
Restricted Subsidiaries are insured with financially sound and reputable
insurance companies not Affiliates of the Borrower, in such amounts (after
giving effect to any self-insurance compatible with the following standards),
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 Restricted Subsidiary operates.

5.11         Taxes.  The Borrower and its Restricted Subsidiaries
have filed all material Federal, state and other tax returns and reports
required to be filed, and have paid all material Federal, state and other Taxes
shown thereon, levied or imposed upon them or their properties, income or
assets, except those which are being contested in good faith by appropriate
proceedings diligently conducted and for which adequate reserves have been
provided in accordance with GAAP or those the failure to pay could not
reasonably be expected to have a Material Adverse Effect.  There is no proposed tax assessment against
the Borrower or any of its Restricted Subsidiaries that could, if made,
reasonably be expected to have a Material Adverse Effect.

5.12         ERISA Compliance.

(a)           Each
Plan is in compliance in all material respects with the applicable provisions
of ERISA, the Code and other Federal or state Laws.  Except as set forth on Schedule 5.12,
each Plan that is intended to qualify under Section 401(a) of the Code has
received a favorable determination letter from the IRS or an application for
such a letter is currently being processed by the IRS with respect thereto and,
to the best knowledge of the Borrower, nothing has occurred which would
prevent, or cause the loss of, such qualification.  The Borrower and each ERISA Affiliate have
made all required contributions to each Pension Plan subject to Section 412 of
the Code, and no application for a funding waiver or an extension of any
amortization period pursuant to Section 412 of the Code has been made with
respect to any Pension Plan.

(b)           There are no
pending or, to the knowledge of the Borrower, threatened claims, actions or lawsuits,
or action by any Governmental Authority, with respect to any Plan that could
reasonably be expected to have a Material Adverse Effect.  There has been no prohibited transaction or
violation of the fiduciary responsibility rules with respect to any Plan that
has resulted or could reasonably be expected to result in a Material Adverse
Effect.

(c)           (i) No ERISA
Event has occurred or is reasonably expected to occur; (ii) no Pension
Plan has any Unfunded Pension Liability; (iii) to the knowledge of the Borrower,
no event has occurred which, with the giving of notice under Section 4219 of
ERISA, could reasonably be expected to result in any liability under Section
4201 or 4243 of ERISA with respect to a Multiemployer Plan; and (iv) neither
the Borrower nor any ERISA Affiliate has engaged in a transaction that could be
subject to Section 4069 or 4212(c) of ERISA.

 

80

 

5.13         Subsidiaries; Loan Parties.  As of the Closing Date, the Borrower has no
Subsidiaries other than those specifically disclosed in Part (a) of Schedule
5.13, and all of the outstanding Equity Interests in such Subsidiaries have
been validly issued, are fully paid and non-assessable and are owned by the
Persons in the amounts specified on Part (a) of Schedule 5.13 free and
clear of all Liens except those created under the Collateral Documents.    Set forth on Part (b) of Schedule 5.13 is a
complete and accurate list of all Loan Parties, showing as of the Closing Date
(as to each Loan Party) the jurisdiction of its incorporation, the exact legal
name of each Loan Party, the address of its principal place of business and its
U.S. taxpayer identification number or, in the case of any non-U.S. Loan Party
that does not have a U.S. taxpayer identification number, its unique
identification number issued to it by the jurisdiction of its incorporation.

5.14         Margin Regulations; Investment
Company Act.

(a)           The
Borrower is not engaged and will not engage, principally or as one of its
important activities, in the business of purchasing or carrying margin stock
(within the meaning of Regulation U issued by the FRB), or extending credit for
the purpose of purchasing or carrying margin stock.  Following the application of the proceeds of
each Borrowing or drawing under each Letter of Credit, not more than 25% of the
value of the assets (either of the Borrower only or of the Borrower and its
Restricted Subsidiaries on a consolidated basis) subject to the provisions of Section
7.01 or Section 7.05 or subject to any restriction contained in any
agreement or instrument between the Borrower and any Lender or any Affiliate of
any Lender relating to Indebtedness and within the scope of Section 8.01(e)
will be margin stock.

(b)           None of the
Borrower, any Person Controlling the Borrower, or any Restricted Subsidiary is
or is required to be registered as an “investment company” under the Investment
Company Act of 1940.

5.15         Disclosure.  No report, financial statement, certificate
or other information furnished in writing by or on behalf of any Loan Party to
the Administrative Agent or any Lender in connection with the transactions
contemplated hereby and the negotiation of this Agreement or delivered
hereunder or under any other Loan Document (in each case 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, the Borrower represents only that such information was prepared in
good faith based upon estimates and assumptions believed to be reasonable at
the time and actual financial conditions or results may materially differ from
projected financial conditions or results.

5.16         Compliance with Laws.  The Borrower and each of its Restricted
Subsidiaries is in compliance in all material respects with the requirements of
all Laws and all orders, writs, injunctions and decrees applicable to it or to
its properties, except in such instances in which (a) such requirement of Law
or order, writ, injunction or decree is being contested in good faith by
appropriate proceedings diligently conducted or (b) the failure to comply therewith,
either

 

81

 

individually
or in the aggregate, could not reasonably be expected to have a Material
Adverse Effect.

5.17         Intellectual Property; Licenses, Etc.  The Borrower and each of its Restricted Subsidiaries
owns, or possesses the right to use, all of the trademarks, service marks,
trade names, copyrights, patents, patent rights, franchises, licenses and other
intellectual property rights (collectively, “Intellectual Property”) that are
reasonably necessary for the operation of its businesses except as, either
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect, and, to the knowledge of the Borrower, such
Intellectual Property rights do not conflict with the rights of any other
Person that in any respect, either individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.

5.18         Solvency.  The Borrower is, and the Borrower and its
Subsidiaries, taken together, are, Solvent.

5.19         Security Interests.  At all times that a Rating Condition exists,
the Collateral Documents create, as security for the Obligations, valid and
enforceable perfected security interests in and Liens on all of the Collateral
subject thereto to the extent such Liens can be perfected by the filing of a
financing statement or the delivery of securities, superior to and prior to the
rights of all third persons and subject to no other Liens other than Liens
permitted pursuant to Section 7.01, in favor of the Administrative
Agent.  At all times on or after the
Closing Date, the Loan Parties have good and marketable title to all Collateral
free and clear of all Liens (except as created pursuant to the Collateral
Documents and except as permitted pursuant to Section 7.01).

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

5.21         Labor Matters.  There are no collective bargaining agreements
or Multiemployer Plans covering the employees of the Borrower or any of its
Restricted Subsidiaries as of the Closing Date and neither the Borrower nor any
of its Restricted Subsidiaries has suffered any strikes, walkouts, work
stoppages or other material labor difficulty within the last five years.

ARTICLE VI

AFFIRMATIVE COVENANTS

So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of
Credit shall remain outstanding, the Borrower shall, and shall (except in the
case of the covenants set forth in Sections 6.01, 6.02, 6.03,
6.11, 6.12, 6.15, 6.16 and 6.17) cause each
of its Restricted Subsidiaries to:

 

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6.01         Financial Statements.  Deliver to the Administrative Agent (for
distribution to the Lenders), in form and detail reasonably satisfactory to the
Administrative Agent and the Required Lenders:

(a)           Annual
Financial Statements.

(i)            As
soon as available, but in any event within 90 days after the close of each
fiscal year of the Borrower, (x) the consolidated balance sheet of the Borrower
and its Subsidiaries as at the end of such fiscal year and the related
consolidated statements of income, of shareholders’ equity and of cash flows
for such fiscal year and (y) if a Rating Condition exists on the last day of
such fiscal year, the consolidating balance sheet of the Borrower and each of
its Subsidiaries as at the end of the fiscal year and the related consolidating
statements of income, of shareholders’ equity and of cash flows for such fiscal
year (prepared in a manner that enables the Administrative Agent and the
Lenders to determine the compliance or noncompliance by the Borrower and the
Restricted Subsidiaries with the covenants and other obligations binding on
such Persons under the Loan Documents), in each case prepared in accordance
with GAAP and setting forth comparative figures for the preceding fiscal year,
and, in the case of such consolidated statements, examined by independent
certified public accountants of recognized national standing whose opinion
shall not be qualified as to the scope of audit or as to the status of the
Borrower as a going concern.

(ii)           Within
five Business Days after filing with the Applicable Insurance Regulatory
Authority, but in any event within 90 days after the close of each fiscal year
of each Regulated Insurance Company, the Annual Statement (prepared in
accordance with SAP) for such fiscal year of such Regulated Insurance Company,
as filed with the Applicable Insurance Regulatory Authority in compliance with
the requirements thereof (or a report containing equivalent information for any
Regulated Insurance Company not so required to file the foregoing with the
Applicable Insurance Regulatory Authority), together with the notarized
statement signed by the Responsible Officers of such Regulated Insurance
Company, as filed on page 1 of such Annual Statement, the “Jurat” page, stating
that such Annual Statement presents fairly in all material respects the
financial condition and results of operations of such Regulated Insurance
Company in accordance with SAP.

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

(iv)          Within
five Business Days after filing with the Applicable Insurance Regulatory
Authority, but in any event within 100 days after the close of each fiscal year
of the Borrower, a copy of the “Statement of Actuarial Opinion” and “Management
Discussion and Analysis” for each Regulated

 

83

 

Insurance Company for such fiscal year and as filed with the Applicable
Insurance Regulatory Authority in compliance with the requirements thereof (or
a report containing equivalent information for any Regulated Insurance Company
not so required to file the foregoing with the Applicable Insurance Regulatory
Authority).

(b)           Quarterly
Financial Statements.

(i)            As
soon as available, but in any event within 45 days after the close of each of
the first three quarterly accounting periods in each fiscal year of the
Borrower, (x) the consolidated balance sheet of the Borrower and its
Subsidiaries at the end of such fiscal quarter and the related consolidated
statements of income, of shareholders’ equity and of cash flows for such
quarterly period and for the elapsed portion of the fiscal year ended with the
last day of such quarterly period and (y) if a Rating Condition exists on the
last day of such fiscal quarter, the consolidating balance sheet of the Borrower
and each of its Subsidiaries as at the end of such fiscal quarter and the
related consolidating statements of income, of shareholders’ equity and of cash
flows for such quarterly period and for the elapsed portion of the fiscal year
ended with the last day of such quarterly period (prepared in a manner that
enables the Administrative Agent and the Lenders to determine the compliance or
noncompliance by the Borrower and the Restricted Subsidiaries with the
covenants and other obligations binding on such Persons under the Loan
Documents), in each case setting forth comparative figures for the related
periods in the prior fiscal year, and all of which shall be prepared in
accordance with GAAP and certified by the chief financial officer of the
Borrower, as the case may be, subject to changes resulting from normal year-end
audit adjustments.

(ii)           Within
five Business Days after filing with the Applicable Insurance Regulatory
Authority, but in any event within 55 days after the close of each of the first
three quarterly accounting periods in each fiscal year of each Regulated
Insurance Company, the quarterly statement (prepared in accordance with SAP)
for such fiscal period of such Regulated Insurance Company, as filed with the
Applicable Insurance Regulatory Authority, together with the notarized
statement signed by the Responsible Officers of such Regulated Insurance
Company, as filed on page 1 of such quarterly statement, the “Jurat” page,
stating that such financial statement fairly presents in all material respects
the financial condition of such Regulated Insurance Company at the date thereof
and its results of operations for the period covered thereby in accordance with
SAP.

(c)           Business
Plan and Budget.  As soon as
available, but in any event no more than 45 days after the end of each fiscal
year of the Borrower, an annual business plan and budget of the Borrower and
its Subsidiaries on a consolidated basis, including forecasts prepared by
management of the Borrower, in form satisfactory to the Administrative Agent,
of consolidated balance sheets and statements of income or operations and cash
flows of the Borrower and its Subsidiaries on a quarterly basis for the
immediately following fiscal year.

 

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As to any information contained in materials furnished pursuant to Section
6.02(d), the Borrower shall not be separately required to furnish such
information under Section 6.01(a)(i) or (b)(i) above, but the
foregoing shall not be in derogation of the obligation of the Borrower to
furnish the information and materials described in Sections 6.01(a) and (b)
above at the times specified therein.

6.02         Certificates; Other
Information.  Deliver to the
Administrative Agent (for distribution to each Lender), in form and detail
reasonably satisfactory to the Administrative Agent and the Required Lenders:

(a)           concurrently
with the delivery of the financial statements referred to in Section 6.01(a)(i),
a certificate of its independent certified public accountants certifying such
financial statements and stating that in making the examination necessary
therefor no knowledge was obtained of any Default under the financial covenants
set forth herein or, if any such Default shall exist, stating the nature and
status of such event;

(b)           concurrently
with the delivery of the financial statements referred to in Sections 6.01(a)(i)
and (b)(i), (i) a duly
completed Compliance Certificate (with respect to the Compliance Certificate
delivered concurrently with the financial statements for the fiscal quarter
ending September 30, 2007, giving pro forma effect to the consummation of the
Acquisition in the event the Acquisition has not been consummated on or before
September 30, 2007), signed by the chief financial officer or other Responsible
Officer of the Borrower, and (ii) a copy of management’s
discussion and analysis with respect to the consolidated portions of such
financial statements;

(c)           promptly
after any reasonable request by the Administrative Agent or any Lender, copies
of any management letters or written recommendations submitted to the board of
directors (or the audit committee of the board of directors) of the Borrower or
any of its Restricted Subsidiaries by independent accountants in connection
with the accounts or books of the Borrower or any of its Restricted
Subsidiaries, or any audit of any of them;

(d)           promptly
after the same are available, copies of each annual report, proxy or financial
statement or other report or communication sent to the shareholders of the
Borrower, and copies of all annual, regular, periodic and special reports and
registration statements which the Borrower may file or be required to file with
the SEC under Section 13 or 15(d) of the Securities Exchange Act of 1934,
or with any national securities exchange, and in any case not otherwise
required to be delivered to the Administrative Agent pursuant hereto; and

(e)           promptly,
such additional information regarding the business, financial, legal or
corporate affairs of the Borrower or any of its Restricted Subsidiaries, or
compliance with the terms of the Loan Documents, as the Administrative Agent or
any Lender may from time to time reasonably request.

Documents required to be delivered pursuant to Section 6.01 or Section 6.02
may be delivered electronically and if so delivered, shall be deemed to have
been delivered on the date

 

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(i) on which the Borrower posts such documents, or provides a link
thereto on the Borrower’s website on the Internet at the website address listed
on Schedule 10.02; or (ii) on which such documents are posted on the
Borrower’s behalf on an Internet or intranet website, if any, to which each
Lender and the Administrative Agent have access (whether a commercial,
third-party website or whether sponsored by the Administrative Agent); provided
that:  (i) the Borrower shall deliver
paper copies of such documents to the Administrative Agent upon its request
until a written request to cease delivering paper copies is given by the
Administrative Agent and (ii) the Borrower shall notify the Administrative
Agent (by telecopier or electronic mail) of the posting of any such documents
and provide to the Administrative Agent by electronic mail electronic versions
(i.e., soft copies) of such documents. 
Notwithstanding anything contained herein, in every instance the
Borrower shall be required to provide paper copies of the Compliance
Certificates required by Section 6.02(b) to the Administrative
Agent.  Except for such Compliance
Certificates, the Administrative Agent shall have no obligation to request the
delivery or to maintain copies of the documents referred to above.

The Borrower hereby acknowledges that (a) the Administrative Agent
and/or the Arranger will make available to the Lenders and the L/C Issuer
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 so long as the Borrower is the issuer of any
outstanding debt or equity securities that are registered or issued pursuant to
a private offering or is actively contemplating issuing any such securities
it will use commercially reasonable efforts to identify that portion of the
Borrower Materials that may be distributed to the Public Lenders and that (w)
all such Borrower Materials 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,
the L/C Issuer and the Lenders to treat such Borrower Materials as not
containing any material non-public information (although it may be sensitive
and proprietary) 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 10.07); (y) all Borrower Materials
marked “PUBLIC” are permitted to be made available through a portion of the
Platform designated “Public Investor;” 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 not designated “Public
Investor.”  Notwithstanding the foregoing, the Borrower shall be under no obligation
to mark any Borrower Materials “PUBLIC”.

6.03         Notices.  Promptly notify the Administrative Agent
(which shall promptly notify the Lenders):

(a)           of
the occurrence of any Default;

 

86

 

(b)           of
any matter that has resulted or would reasonably be expected to result in a
Material Adverse Effect, including any of the following matters if such matter
has resulted or would reasonably be expected to result in a Material Adverse
Effect:  (i) any default under, a
Contractual Obligation of the Borrower or any Restricted Subsidiary,
(ii) any dispute, litigation, investigation, proceeding or suspension
between the Borrower or any of its Restricted Subsidiaries and any Governmental
Authority or (iii) the commencement of, or any material adverse development in,
any litigation or proceeding affecting the Borrower or any of its Restricted
Subsidiaries, including pursuant to any applicable Environmental Laws;

(c)           of
the occurrence of any ERISA Event that has resulted or could reasonably be
expected to result in a Material Adverse Effect;

(d)           of
any material change in accounting policies or financial reporting practices by
the Borrower or any of its Restricted Subsidiaries,
including any determination by the Borrower referred to in Section 2.10(b);

(e)           of
the occurrence of any Disposition of property or assets for which the Borrower
is required to make a mandatory prepayment pursuant to Section 2.05(b)(ii);

(f)            of any announcement by S&P of
any change or possible change in a Borrower’s corporate rating; and

(g)           of the consummation of the
Acquisition.

Each notice pursuant to this Section 6.03 (other than Section
6.03(e), (f) or (g)) shall be accompanied by a statement of a
Responsible Officer of the Borrower setting forth details of the occurrence
referred to therein and stating what action the Borrower has taken and proposes
to take with respect thereto.  Each
notice pursuant to Section 6.03(a) shall describe with particularity any
and all provisions of this Agreement and any other Loan Document that have been
breached.

6.04         Payment of Obligations.  Pay, discharge or otherwise satisfy, at or
before maturity or before they become delinquent, all of its obligations and
liabilities, including (a) all Tax liabilities; (b) all lawful claims which, if
unpaid, would by law become a Lien upon its property (other than a Lien
permitted hereunder); and (c) all Indebtedness, but subject to any subordination
provisions contained in any instrument or agreement evidencing such
Indebtedness, except, in each such case, (i) where the amount or validity
thereof is being contested in good faith by appropriate proceedings diligently
conducted and adequate reserves in accordance with GAAP are being maintained by
the Borrower or such Restricted Subsidiary or (ii) to the extent that failure
to pay or discharge such obligations and liabilities could not reasonably be
expected to have a Material Adverse Effect. 
On or before the fifth Business Day after the consummation of the
Acquisition, effect the Refinancing of the Indebtedness and obligations
described in clause (c) of the definition of Existing Agreements, the
termination of all commitments relating thereto, and the release and
termination of all liens and security interests related thereto (other than any
liens or security interests permitted under the Loan Documents), in each case
on terms reasonably satisfactory to the Administrative Agent.

 

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6.05         Preservation
of Existence, Etc.  (a) Preserve and maintain in full force and
effect its legal existence and good standing under the Laws of the jurisdiction
of its organization except in a transaction permitted by Section 7.04 or 7.05;
provided, however, that the Borrower and any of its Restricted Subsidiaries may
consummate any merger or consolidation permitted under Section 7.04; (b)
take all reasonable action to maintain all rights, privileges, permits, licenses
and franchises necessary in the normal conduct of its business, except to the
extent that failure to do so could not reasonably be expected to have a
Material Adverse Effect; and (c) renew and use all reasonable efforts to
preserve all of its Intellectual Property, the non-preservation of which could
reasonably be expected to have a Material Adverse Effect.

6.06         Maintenance
of Properties.  Maintain all of its material properties and
equipment necessary in the operation of its business in good working order and condition,
ordinary wear and tear excepted, except where the failure to do so could not
reasonably be expected to have a Material Adverse Effect.

6.07         Maintenance of Insurance.  Maintain with financially sound and reputable
insurance companies not Affiliates of the Borrower, insurance with respect to
its properties and business against loss or damage of the kinds customarily
insured against by Persons engaged in the same or similar business, of such
types and in such amounts (after giving effect to any self-insurance compatible
with the following standards) as are customarily carried under similar
circumstances by such other Persons.

6.08         Compliance with Laws.  Comply in all material respects with the
requirements of all Laws and all orders, writs, injunctions and decrees
applicable to it or to its business or property, except in such instances in
which (a) such requirement of Law or order, writ, injunction or decree is being
contested in good faith by appropriate proceedings diligently conducted or (b)
the failure to comply therewith could not reasonably be expected to have a
Material Adverse Effect.

6.09         Books
and Records.  (a) Maintain proper books of record and
account, in which full, true and correct entries in conformity with GAAP or SAP
in all material respects, as applicable, consistently applied shall be made of
all financial transactions and matters involving the assets and business of the
Borrower or such Restricted Subsidiary, as the case may be; and (b) maintain
such books of record and account in material conformity with all applicable
material requirements of any Governmental Authority having regulatory
jurisdiction over the Borrower or such Restricted Subsidiary, as the case may
be.

6.10         Inspection Rights.  Permit representatives and independent contractors
of the Administrative Agent and each Lender to visit and inspect any of its
material properties, to examine its corporate, financial and operating records,
and make copies thereof or abstracts therefrom, and to discuss its affairs,
finances and accounts with its directors, officers, and independent public
accountants (and the Borrower shall be afforded the opportunity to participate
in any discussions with such independent public accountants), all at the
expense of the Borrower and at such reasonable times during normal business
hours but no more than one time during each calendar year, upon reasonable
advance notice to the Borrower (subject
to reasonable requests of confidentiality, including requirements imposed by
Law and contract); provided, however,
that when an Event of Default exists the Administrative Agent or any Lender

 

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(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, without advance notice and as often as desired.

6.11         Use of Proceeds.

(a)           Use
the proceeds of  the Term Facility to
fund, in part, the Acquisition and the Refinancing and to pay the fees and
expenses related thereto;

(b)           use
the proceeds of the Revolving Credit Loans (in an amount up to $10,000,000) to
fund, in part, the Acquisition and the Refinancing; and

(c)           use
the proceeds of the Revolving Credit Facility for permitted Capital
Expenditures and acquisitions permitted hereunder, to make “earn-out” payments
payable pursuant to the Acquisition Agreement, to provide for the ongoing
working capital requirements of the Borrower and its Restricted Subsidiaries
and for general corporate purposes.

6.12         Covenant to Guarantee Obligations
and Give Security.

(a)           Upon
the formation or acquisition of any new direct or indirect Restricted
Subsidiary by the Borrower, the Borrower shall, at the Borrower’s expense:

(i)            within 20 days
after such formation or acquisition, cause such Restricted Subsidiary (if it
qualifies to be a Guarantor) to duly execute and deliver to the Administrative
Agent a joinder to the Guaranty, in form and substance satisfactory to the
Administrative Agent, guaranteeing the Obligations,

(ii)           within 20 days
after such formation or acquisition, cause each direct owner of the Equity
Interests of such Restricted Subsidiary (if it has not already done so and if
such Equity Interest qualifies to be Collateral) to duly execute and deliver to
the Administrative Agent a supplement or joinder to the Pledge Agreement, in
form and substance reasonably satisfactory to the Administrative Agent,
covering such Equity Interests; and

(iii)          within 30 days
after such formation or acquisition, deliver to the Administrative Agent, upon
the request of the Administrative Agent in its reasonable discretion, a
favorable opinion, addressed to the Administrative Agent and the other Secured
Parties, of counsel for the Borrower or such other Pledgor reasonably
acceptable to the Administrative Agent as to such matters as the Administrative
Agent may reasonably request.

(b)           In the event any
Subsidiary that is an Excluded Subsidiary ceases to be an Excluded Subsidiary,
the Borrower shall promptly give the Administrative Agent notice thereof and,
within 20 days thereafter and at its expense, shall cause such Subsidiary to
become a Guarantor by executing and delivering to the Administrative Agent a
joinder to the Guaranty pursuant to Section 4.16 of the Guaranty, together with
such other

 

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documents, instruments, evidences and opinions in connection therewith
as the Administrative Agent may reasonably request.

(c)           In the event that
the Equity Interests of any Subsidiary that are excluded from the definition of
Collateral cease to be so excluded, the Borrower shall promptly give the
Administrative Agent notice thereof, and within 20 days thereafter and at its
expense, shall cause such Equity Interests to become part of the Collateral by
the execution and delivery by the appropriate Persons of a supplement to the
Pledge Agreement pursuant to Section 7.22 of the Pledge Agreement, together
with such other documents, instruments, evidences and opinions in connection
therewith as the Administrative Agent may reasonably request.

(d)           At any time upon request of the Administrative Agent,
promptly execute and deliver any and all further instruments and documents and
take all such other action as the Administrative Agent may reasonably deem
necessary or desirable in obtaining the full benefits of, or (as applicable) in
perfecting and preserving the Liens of, the Guaranty and the Pledge Agreement.

6.13         Compliance with Environmental Laws.  Comply, and cause all lessees and other
Persons operating or occupying its properties to comply, in all material
respects, with all applicable Environmental Laws and Environmental Permits;
obtain and renew all Environmental Permits necessary for its operations and
properties; and conduct any investigation, study, sampling and testing, and
undertake any cleanup, removal, remedial or other action necessary to remove
and clean up all Hazardous Materials from any of its properties, to the extent
required by and in accordance with the requirements of all Environmental Laws; provided,
however, that neither the Borrower nor any of its Restricted Subsidiaries shall
be required to undertake any such cleanup, removal, remedial or other action to
the extent that its obligation to do so is being contested in good faith and by
proper proceedings and appropriate reserves are being maintained with respect
to such circumstances in accordance with GAAP.

6.14         Further Assurances.  Promptly upon request by the Administrative
Agent, or any Lender through the Administrative Agent, (a) correct any material
defect or error that may be discovered in any Loan Document or in the
execution, acknowledgment, filing or recordation thereof, and (b) do, execute,
acknowledge, deliver, record, re-record, file, re-file, register and
re-register any and all such further acts, deeds, certificates, assurances and
other instruments as the Administrative Agent, or any Lender through the
Administrative Agent, may reasonably require from time to time, in each case,
in order to (i) to the fullest extent permitted by applicable law, subject the
Borrower’s or any of its Restricted Subsidiaries’ properties, assets, rights or
interests to the Liens now or hereafter intended to be covered by any of the
Collateral Documents, (ii) perfect and maintain the validity, effectiveness and
priority of any of the Collateral Documents and any of the Liens intended to be
created thereunder and (iii) assure, convey, grant, assign, transfer, preserve,
protect and confirm more effectively unto the Administrative Agent and the
Lenders the rights granted or now or hereafter intended to be granted to the
Administrative Agent and the Lenders under any Loan Document to which the
Borrower or any of its Restricted Subsidiaries is or is to be a party.

 

90

 

6.15         Designation of Subsidiaries as Restricted and
Unrestricted.  In its sole
discretion, at any time designate any Restricted Subsidiary as an Unrestricted
Subsidiary or any Unrestricted Subsidiary as a Restricted Subsidiary by giving
the Administrative Agent notice thereof; provided that (i) the Borrower is in
Pro Forma Compliance (and, as a condition precedent to the effectiveness of any
such designation, the Borrower shall deliver to the Administrative Agent a
certificate setting forth in reasonable detail the calculations demonstrating
such compliance), (ii) no Subsidiary may be designated as an Unrestricted
Subsidiary if it is a “restricted subsidiary” for the purpose of any other
financing of the Borrower, and (iii) no Restricted Subsidiary may be designated
as an Unrestricted Subsidiary if it was previously designated as an
Unrestricted Subsidiary. The designation of any Subsidiary as an Unrestricted
Subsidiary shall constitute an Investment by the Borrower or a Restricted
Subsidiary, as applicable, therein at the date of designation in an amount
equal to the net book value of the Borrower’s or such Restricted Subsidiaries’
(as applicable) Investment therein.  The
designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall
constitute the incurrence at the time of designation of any Indebtedness or
Liens of such Subsidiary existing at such time. 
The Borrower will cause each Unrestricted Subsidiary to maintain the
separateness of its existence and operations and to observe all corporate or
other organizational formalities relating to such separate existence and
operations.

 

6.16         A.M. Best Rating. 
Use commercially reasonable efforts to cause each of the Regulated
Insurance Companies that is a Domestic Subsidiary to be rated for financial
strength by A.M. Best at all times.

6.17         S&P Rating.   If the Borrower has a corporate rating by
S&P on the Closing Date, use commercially reasonable efforts to maintain a
corporate rating by S&P at all times thereafter.

 

6.18         Escrow Documents. 
Perform its obligations under the Escrow Documents in all material
respects in accordance with their terms.

 

ARTICLE VII

NEGATIVE COVENANTS

So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of
Credit shall remain outstanding, the Borrower shall not, nor shall it permit
any of its Restricted Subsidiaries to, directly or indirectly:

7.01         Liens.  Create, incur, assume or suffer to exist any
Lien upon any of its property, assets or revenues, whether now owned or
hereafter acquired, or sign or file or suffer to exist under the UCC of any
jurisdiction a financing statement that names the Borrower or any of its
Restricted Subsidiaries as debtor, or assign any accounts or other right to
receive income, other than the following:

(a)           Liens
pursuant to any Loan Document;

(b)           Liens
existing on the date hereof and listed on Schedule 5.08(b) (other than
any Liens designated thereon to be released or discharged concurrently with

 

91

 

the initial Borrowings hereunder) and any renewals or extensions
thereof, provided that (i) no new property or additional property (in
each case, other than property that is substantially similar in kind and value
to the property subject to such Liens immediately before any such renewal or
extension and that is in substitution for such property) is subjected to such
Liens, (ii) the amount secured or benefited thereby is not increased except as
contemplated by Section 7.02(d) and (iii) any renewal or extension of
the obligations secured or benefited thereby is permitted by Section 7.02(d);

(c)           Liens
for Taxes not yet due or which are being contested in good faith and by
appropriate proceedings diligently conducted, if adequate reserves with respect
thereto are maintained on the books of the applicable Person in accordance with
GAAP;

(d)           carriers’,
warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like Liens
arising in the ordinary course of business the indebtedness related to which is
not overdue for a period of more than 45 days or which are being contested in
good faith and by appropriate proceedings diligently conducted, if adequate
reserves with respect thereto are maintained on the books of the applicable
Person;

(e)           pledges
or deposits in the ordinary course of business in connection with workers’
compensation, unemployment insurance and other social security legislation,
other than any Lien imposed by ERISA;

(f)            deposits
to secure the performance of bids, tenders, trade contracts and leases (other
than Indebtedness), statutory obligations, surety, stay and appeal bonds,
performance bonds and other obligations of a like nature incurred in the
ordinary course of business;

(g)           easements,
rights-of-way, restrictions, licenses, covenants and other similar encumbrances
affecting real property which, in the aggregate, are not substantial in amount,
and which do not in any case materially detract from the value of the property
subject thereto or materially interfere with the ordinary conduct of the
business of the applicable Person;

(h)           Liens
securing judgments for the payment of money not constituting an Event of
Default under Section 8.01(h);

(i)            Liens
securing Indebtedness permitted under Section 7.02(f); provided
that (i) such Liens do not at any time encumber any property other than
the property financed by such Indebtedness and (ii) the Indebtedness secured
thereby does not exceed the cost or fair market value, whichever is lower, of
the property being acquired on the date of acquisition;

(j)            any
Lien of a lessor under any operating lease entered into by the Borrower or any
of its Restricted Subsidiaries as lessee in the ordinary course of its business
and covering only the leased assets;

 

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(k)           any Lien deemed to
exist in connection with an Investment described in clause (e) of the
definition of “Cash Equivalents”, covering only the securities subject to such
Investment;

(l)            Liens
of a collecting bank arising under Section 4-210 of the UCC on items in
the process of collection;

(m)          Liens
of sellers of goods to the Borrower or any of its Restricted Subsidiaries
arising under Article 2 of the UCC or similar provisions of applicable law
in the ordinary course of business, covering only the goods sold and securing
only the purchase price for such goods;

(n)           Liens
on property or assets acquired pursuant to an acquisition permitted hereunder; provided
that such Liens were not created in contemplation of such acquisition and are
not extended to cover any other property or assets of the Borrower or any of
its Restricted Subsidiaries;

(o)           Liens
on any cash earnest money deposits made in connection with an Investment or
acquisition permitted hereunder;

(p)           Liens
in favor of the Borrower or any Guarantor;

(q)           bankers’
Liens, rights of setoff and other like Liens arising in the ordinary course of
business in connection with Investments in deposit accounts and other Cash
Equivalents permitted hereunder;

(r)            Liens
deemed to exist in favor of the purchaser of property or assets that are
subject to an agreement for a Disposition permitted hereunder;

(s)           Liens
consisting of licenses of Intellectual Property granted in the ordinary course
of business;

(t)            Repurchase
rights, transfer restrictions, rights of first refusal or other similar
restrictions set forth in the organizational documents of the Borrower or any
of its Restricted Subsidiaries or pursuant to applicable Federal and state
securities Laws;

(u)           Liens
on cash securing any Swap Contract permitted hereunder;

(v)           other
Liens securing Indebtedness permitted under Section 7.02(h); provided
that no such Lien shall extend to or cover any Collateral; and

(w)          other
Liens that are incidental to the ordinary conduct of the business of the
Borrower or any of its Restricted Subsidiaries or the ownership of its property
or assets, do not secure any Indebtedness, and do not in the aggregate
materially impair the ordinary conduct of such business or the use or operation
of such property or assets.

7.02         Indebtedness.  Create, incur, assume or suffer to exist any
Indebtedness, except:

 

93

(a)           obligations
(contingent or otherwise) existing or arising under any Swap Contract, provided
that (i) such obligations are (or were) entered into by such Person in the
ordinary course of business for the purpose of directly mitigating risks
associated with fluctuations in interest rates or foreign exchange rates and
(ii) such Swap Contract does not contain any provision exonerating the
non-defaulting party from its obligation to make payments on outstanding
transactions to the defaulting party;

(b)           Indebtedness of (i)
the Borrower owed to a Guarantor or (ii) a Restricted Subsidiary of the
Borrower owed to the Borrower or a Restricted Subsidiary of the Borrower, which
Indebtedness shall be otherwise permitted under the provisions of Section
7.03;

(c)           Indebtedness under
the Loan Documents;

(d)           Indebtedness
outstanding on the date hereof and listed on Schedule 7.02 and any
interest thereon and fees with respect thereto and any refinancings,
refundings, renewals or extensions thereof; provided that the amount of
such Indebtedness is not increased at the time of such refinancing, refunding,
renewal or extension except by an amount equal to accrued interest thereon, any
premium or other reasonable amount paid, and fees and expenses reasonably
incurred, in connection with such refinancing and by an amount equal to any
existing commitments unutilized thereunder;
and provided, further, that the terms relating to principal
amount, amortization, maturity and subordination (if any) of any such
refinancing, refunding, renewing or extending Indebtedness, and of any
agreement entered into and of any instrument issued in connection therewith,
are no less favorable in any material respect to the Borrower and its
Restricted Subsidiaries or the Lenders than the terms of any agreement or
instrument governing the Indebtedness being refinanced, refunded, renewed or
extended and the interest rate applicable to any such refinancing, refunding,
renewing or extending Indebtedness does not exceed the then applicable market
interest rate;

(e)           Guarantees of the
Borrower or any Restricted Subsidiary in respect of
Indebtedness otherwise permitted hereunder of the Borrower or any Restricted Subsidiary;

(f)            Indebtedness in
respect of Capitalized Leases, Synthetic Lease Obligations and purchase money
obligations for fixed or capital assets within the limitations set forth in Section
7.01(i); provided, however, that the aggregate amount of all
such Indebtedness at any one time outstanding shall not exceed $50,000,000;

(g)           Indebtedness
outstanding on the date hereof in respect of the Trust Preferred Securities
(and all interest and other obligations in connection therewith);

(h)           other Indebtedness
secured by Liens permitted by Section 7.01(v) in an aggregate principal
amount not to exceed $50,000,000 at any time outstanding;

(i)            Indebtedness of any
Person that becomes a Restricted Subsidiary after the Closing Date in
connection with an acquisition or Investment permitted hereunder and any
interest thereon and fees with respect thereto and any refinancings, refundings,

 

94

 

renewals
or extensions thereof; provided that such Indebtedness was not incurred
in connection with such acquisition or Investment and any such refinancing,
refunding, renewal or extension satisfies the requirements of the provisos to Section
7.02(d);

(j)            Indebtedness
consisting of fixed or non-contingent “earn-out” payment obligations under
acquisition or similar agreements (other than the Acquisition Agreement); provided
that the aggregate amount of such Indebtedness shall not exceed $100,000,000 at
any time; and

(k)           other unsecured
Indebtedness in an aggregate principal amount not to exceed $100,000,000 at any
time outstanding.

7.03         Investments.  Make or hold any Investments, except:

(a)           Investments
held by the Borrower and its Restricted Subsidiaries in the form of Cash
Equivalents;

(b)           advances
to officers, directors and employees of the Borrower and its Restricted
Subsidiaries not to exceed $5,000,000 at any time outstanding for travel,
entertainment, relocation and analogous ordinary business purposes;

(c)           Investments
by the Borrower in its Subsidiaries and by its Restricted Subsidiaries in their
respective Subsidiaries, provided that the aggregate Investments by the
Borrower and its Restricted Subsidiaries in all of the Unrestricted
Subsidiaries shall not exceed 15% of the Consolidated Total Assets of the
Borrower and its Restricted Subsidiaries;

(d)           Investments
consisting of extensions of credit in the nature of accounts receivable or
notes receivable arising from the grant of trade credit in the ordinary course
of business, and Investments received in satisfaction or partial satisfaction
thereof from financially troubled account debtors to the extent reasonably
necessary in order to prevent or limit loss;

(e)           Guarantees permitted
by Section 7.02(e);

(f)            Investments
existing on the date hereof (other than those referred to in Section 7.03(c));

(g)           Investments by the
Borrower in Swap Contracts permitted under Section 7.02(a);

(h)           the purchase or
other acquisition of all of the Equity Interests in, or all or substantially
all of the property of, any Person that, upon the consummation thereof, will be
wholly-owned directly by the Borrower or one or more of its Restricted
Subsidiaries (including as a result of a merger or consolidation); provided
that, with respect to each purchase or other acquisition made pursuant to this Section
7.03(h):

(i)            Borrower shall
comply with the requirements of Section 6.12;

 

95

 

(ii)           the lines of
business of the Person to be (or the property of which is to be) so purchased
or otherwise acquired shall be similar lines of business to one or more of the
principal businesses of the Borrower and its Restricted Subsidiaries in the
ordinary course;

(iii)          the board of
directors or other governing body of the Person to be purchased or acquired
shall have approved such purchase or acquisition;

(iv)          the Borrower is in
Pro Forma Compliance; and

(v)           the Borrower shall
have delivered to the Administrative Agent, at least five Business Days prior
to the date on which any such purchase or other acquisition is to be
consummated, a certificate of a Responsible Officer, in form and substance
reasonably satisfactory to the Administrative Agent and the Required Lenders,
certifying that all of the requirements set forth in this Section 7.03(h)
have been satisfied or will be satisfied on or prior to the consummation of
such purchase or other acquisition and demonstrating Pro Forma Compliance; and

(i)            Investments
(including debt obligations) received in the ordinary course of business by the
Borrower or any of its Restricted Subsidiaries in connection with the
bankruptcy or reorganization of suppliers and customers or in settlement of delinquent
obligations of, and other disputes with, customers and suppliers arising in the
ordinary course of business;

(j)            Investments of any
Person outstanding at the time such Person becomes a Restricted Subsidiary
pursuant to an acquisition or Investment permitted hereunder; provided
that such Investment was not made in contemplation of such acquisition or
Investment;

(k)           Investments
consisting of pledges and deposits described in Section 7.01(e);

(l)            Investments
consisting of the deferred sales price received in connection with any
Disposition permitted hereunder;

(m)          Investments in
prepaid expenses and negotiable instruments held for collection and Investments
consisting of workers’ compensation, performance and similar deposits provided
to third parties in the ordinary course of business;

(n)           Investments made
pursuant to the Novation Agreement; and

(o)           Investments by the
Borrower and its Restricted Subsidiaries not otherwise permitted under this Section
7.03; provided that, with respect to each Investment made pursuant
to this Section 7.03(o):

(i)            such Investment
shall be in property that is part of, or in lines of business that are, similar
lines of business to one or more of the principal businesses of the Borrower
and its Restricted Subsidiaries in the ordinary course;

 

96

 

(ii)           if a Rating
Condition exists at the time a definitive agreement for such Investment is
entered into, the total all cash and noncash consideration (including the fair
market value of all Equity Interests issued or transferred to the sellers
thereof, all indemnities, earn-outs and other contingent payment obligations
to, and the aggregate amounts paid or to be paid under noncompete, consulting
and other affiliated agreements with, the sellers thereof, all write-downs of
property and reserves for liabilities with respect thereto and all assumptions
of debt, liabilities and other obligations in connection therewith) paid by or
on behalf of the Borrower and its
Restricted Subsidiaries in connection with such Investment, when aggregated
with the total cash and noncash consideration paid by or on behalf of the
Borrower and its Restricted Subsidiaries for all other Investments made by the
Borrower or its Restricted Subsidiaries at a time that a Rating Condition
exists, shall not exceed $125,000,000; and

(iii)          the Borrower is in
Pro Forma Compliance.

7.04         Fundamental Changes.  Merge, dissolve, liquidate, consolidate with
or into another Person, or Dispose of (whether in one transaction or in a
series of related transactions) all or substantially all of its assets (whether
now owned or hereafter acquired) to or in favor of any Person, except that, so
long as no Default exists or would result therefrom:

(a)           any
Restricted Subsidiary may merge with (i) the Borrower, provided that the
Borrower shall be the continuing or surviving Person, or (ii) any one or more
other Subsidiaries, provided that when any Restricted
Subsidiary is merging with another Subsidiary, such Restricted
Subsidiary shall be the continuing or surviving Person;

(b)           any
Restricted Subsidiary may Dispose of all or substantially all of its assets
(upon voluntary liquidation or otherwise) to the Borrower or to a Restricted
Subsidiary; provided that if such Restricted Subsidiary is a Guarantor
or Pledgor, the transferee thereof must either be the Borrower or a Guarantor
or Pledgor;

(c)           the Borrower and its
Subsidiaries may consummate the Acquisition;

(d)           any
Disposition permitted by Section 7.05 may be consummated (but any such
Disposition shall be subjected to the final proviso to Section 7.05);

(e)           Dispositions
pursuant to the Novation Agreement may be consummated; and

(f)            in connection with any acquisition
permitted under Section 7.03, the Borrower or any Restricted Subsidiary
of the Borrower may merge into or consolidate with any other Person or permit
any other Person to merge into or consolidate with it; provided that the
Person surviving such merger shall be the Borrower (if the Borrower is a party
thereto) or a Restricted Subsidiary of the Borrower.

7.05         Dispositions.  Make any Disposition or enter into any
agreement to make any Disposition, except:

 

97

 

(a)           Dispositions
of surplus, obsolete or worn out property, whether now owned or hereafter
acquired, in the ordinary course of business;

(b)           Dispositions
of inventory in the ordinary course of business;

(c)           Dispositions of
equipment or real property to the extent that (i) such property is exchanged
for credit against the purchase price of similar replacement property or (ii)
all of substantially all of the proceeds of such Disposition are reasonably
promptly applied to the purchase price of such replacement property;

(d)           Dispositions of
property by any Restricted Subsidiary to the Borrower or to another Restricted
Subsidiary or by the Borrower to a Guarantor; provided that if such
Restricted Subsidiary is a Guarantor or Pledgor, the transferee thereof must
either be the Borrower or a Guarantor or Pledgor;

(e)           the licensing or
cross-licensing of Intellectual Property in the ordinary course of business;

(f)            the sale or
issuance of any Subsidiary’s capital stock to the Borrower or any Restricted
Subsidiary to the extent permitted by Section 7.03(c);

(g)           the leasing or
sub-leasing of property or assets in the ordinary course of business;

(h)           the sale or
discount, in each case without recourse and in the ordinary course of business,
of overdue accounts receivable arising in the ordinary course of business, but
only in connection with the compromise or collection thereof consistent with
the Borrower’s or such Restricted Subsidiary’s commercially reasonable
judgment;

(i)            Dispositions to
Governmental Authorities as the result of the exercise of eminent domain or
Dispositions to Governmental Authorities in lieu of such exercise, and
Dispositions to insurers in connection with the settlement of insurance claims
involving property or assets that have been the subject of a casualty;

(j)            Dispositions of the
capital stock of Unrestricted Subsidiaries;

(k)           Dispositions
consisting of Restricted Payments permitted by Section 7.06;

(l)            Dispositions
consisting of Investments permitted by Section 7.03;

(m)          Dispositions
permitted by Section 7.04;

(n)           the abandonment,
termination or other Disposition of Intellectual Property or leasehold
interests in property in the ordinary course of business; and

(o)           other Dispositions
during any fiscal year of property or assets having an aggregate fair market
value of less than $50,000,000;

 

98

 

provided, however,
that any Disposition pursuant to Sections 7.05(a), (b), (c),
(d), (e), (g), (j), and (o) shall be for fair market value.

7.06         Restricted Payments.  Declare or make, directly or indirectly, any
Restricted Payment, except that, so long as no Default shall have occurred and
be continuing at the time of any action described below or would result
therefrom:

(a)           each
Restricted Subsidiary may make Restricted Payments to the Borrower, any
Restricted Subsidiary and any other Person that owns a direct Equity Interest
in such Restricted Subsidiary, ratably according to their respective holdings
of the type of Equity Interest in respect of which such Restricted Payment is
being made;

(b)           the
Borrower and each Restricted Subsidiary may declare and make dividend payments
or other distributions payable solely in Qualified Equity Interests of such
Person;

(c)           the Borrower and
each Restricted Subsidiary may purchase, redeem or otherwise acquire its Equity
Interests with the proceeds received from the substantially concurrent issue of
new Qualified Equity Interests;

(d)           if a Rating
Condition exists at the time such Restricted Payment is declared, the Borrower
may declare or make, directly or indirectly, a Restricted Payment if such Restricted Payment is payable in cash the amount of such
Restricted Payment, when aggregated with the amount of all other Restricted
Payments committed to be made in cash at a time that a Rating Condition exists,
does not exceed $125,000,000; and

(e)           if a Rating Condition
does not exist at the time such Restricted Payment is declared, the Borrower
may declare or make, directly or indirectly, a Restricted Payment if the
Borrower is in Pro Forma Compliance.

7.07         Change in Nature of Business.  Engage in any material line of business
substantially different from those lines of business conducted by the Borrower
and its Restricted Subsidiaries or the Acquired Business on the date hereof or
any business substantially related or incidental thereto.

7.08         Transactions with Affiliates.  If a Rating Condition exists, enter into any
transaction of any kind with any Affiliate of the Borrower, whether or not in
the ordinary course of business, other than (i) on terms substantially as
favorable to the Borrower or such Restricted Subsidiary as would be obtainable
by the Borrower or such Restricted Subsidiary at the time in a comparable arm’s
length transaction with a Person other than an Affiliate; (ii) a transaction
between or among the Borrower and any of its Subsidiaries that is not otherwise
prohibited hereunder; (iii) the indemnification or compensation of, and
reimbursement of expenses to, directors and officers of the Borrower or any of
its Restricted Subsidiaries; and/or (iv) pursuant to any agreement with any
Affiliate in effect on the date hereof or any modification thereof; provided
that such modification meets the requirements of clause (i) of this Section
7.08.

7.09         Burdensome Agreements.  Enter into or permit to exist any Contractual
Obligation (other than this Agreement or any other Loan Document) that (a)
limits the ability

 

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(i) of
any Restricted Subsidiary to make Restricted Payments to the Borrower or any
other Restricted Subsidiary or to otherwise transfer property to or invest in
the Borrower or any other Restricted Subsidiary, except for any agreement in
effect (A) on the date hereof and set forth on Schedule 7.09 or (B) at the time
any Person becomes a Restricted Subsidiary of the Borrower, so long as such
agreement was not entered into solely in contemplation of such Person becoming
a Restricted Subsidiary of the Borrower, (ii) of any Restricted Subsidiary to
Guarantee the Indebtedness of the Borrower (if such Restricted Subsidiary is a
Domestic Subsidiary and not an Excluded Subsidiary) or (iii) of the Borrower or
any Restricted Subsidiary to create, incur, assume or suffer to exist Liens on
property of such Person; provided, however, that this clause (iii) shall not
prohibit any negative pledge incurred or provided (1) in favor of any holder of
Indebtedness permitted under Section 7.02(f) solely to the extent any such
negative pledge relates to the property financed by or the subject of such
Indebtedness; (2) pursuant to prohibitions and limitations in effect on the
date hereof and listed on Schedule 7.09; (3) pursuant to customary
provisions contained in joint venture agreements and other similar agreements
applicable to joint ventures permitted hereunder entered into in the ordinary
course of business solely to the extent any such negative pledge relates to
property contributed to such joint ventures; (4) pursuant to customary
provisions restricting the subletting or assignment of a lease entered into in
the ordinary course of business solely to the extent any such negative pledge
relates to the property subject to such lease; (5) pursuant to customary
restrictions contained in any agreement relating to a Disposition permitted
hereunder solely to the extent any such negative pledge relates to the property
subject to such Disposition; and (6) pursuant to any agreement in effect at the
time any Person becomes a Restricted Subsidiary so long as such agreement was
not entered into in contemplation thereof; or (b) requires the grant of a Lien
to secure an obligation of such Person if a Lien is granted to secure another
obligation of such Person.

7.10         Use of Proceeds.  Use the proceeds of any Credit Extension,
whether directly or indirectly, and whether immediately, incidentally or
ultimately, to purchase or carry margin stock (within the meaning of Regulation
U of the FRB) or to extend credit to others for the purpose of purchasing or
carrying margin stock or to refund indebtedness originally incurred for such
purpose.

7.11         Financial Covenants. Commencing
with the second full fiscal quarter period after the Closing Date: 

(a)           Minimum Risk
Based Capital.  Permit the Risk Based Capital Ratio as of the
end of any quarterly accounting period in a fiscal year for any Regulated
Insurance Company that is a Restricted Subsidiary to be less than 1.50:1.00; provided
that, so long as a Regulated Insurance Company that is a Restricted Subsidiary
maintains at least the minimum risk-based capital required by each Applicable
Insurance Regulatory Authority, (i) unrestricted Cash Equivalents in excess of
$25,000,000 held by the Borrower and/or any of its Restricted Subsidiaries that
are not Regulated Insurance Companies and (ii) the amount, in excess of
$50,000,000, by which the Revolving Credit Facility exceeds the sum of (A) the
Outstanding Amount of the Revolving Credit Loans and (B) the Outstanding Amount
of the L/C Obligations may be included, without duplication, in the computation
of the Total Adjusted Capital of such Regulated Insurance Company for purposes
of determining compliance with this Section 7.11(a).

 

100

 

(b)           Consolidated Leverage Ratio.  Permit the Consolidated Leverage Ratio
determined at the end of any quarterly accounting period in a fiscal year of
the Borrower to be more than 3.25:1.00.

7.12         Amendments of Organization Documents.  Amend any of its Organization Documents in a
manner that could reasonably be determined to be materially adverse to the
Lenders (provided that the amendment of an Organization Document to effect the
change in the name of any Person shall be deemed not to be materially adverse
to the Lenders), except in connection with a transaction otherwise permitted
under the Loan Documents.

7.13         Accounting Changes.  Make any change in (a) accounting
policies or reporting practices, except as required by GAAP or SAP, as
applicable, or (b) its fiscal year.

7.14         Prepayments, Etc. of Indebtedness.  Prepay, redeem, purchase, defease or
otherwise satisfy prior to the scheduled maturity thereof in any manner, or
make any payment in violation of any subordination terms of, any Indebtedness,
except (a) the prepayment of the Credit Extensions in accordance with the
terms of this Agreement, (b) regularly scheduled or required repayments or
redemptions of Indebtedness set forth in Schedule 7.02 and refinancings and
refundings of such Indebtedness in compliance with Section 7.02(d) and (c)
the Refinancing.

7.15         Amendment,
Etc. of Acquisition Agreement and
Indebtedness.  (a) Terminate the
Acquisition Agreement or consent to or accept any termination thereof; (b)
amend, waive, modify or change in any manner any material term or condition of
the Acquisition Agreement; (c) waive any material default under or any breach
of any material term or condition of the Acquisition Agreement; provided that,
in the case of each of clauses (a), (b) and (c), the prohibited amendment or
action, as applicable, shall be limited to those that would materially impair
the value of the interest or rights of the Borrower and the Restricted
Subsidiaries, taken as a whole, thereunder or that would materially impair the
rights or interests of the Administrative Agent or any Lender; or (d) amend,
modify or change any material term or condition of any Indebtedness set forth
in Schedule 7.02 in a manner adverse to the interests of the Administrative
Agent or any Lender, except for any refinancing, refunding, renewal or
extension thereof permitted by Section 7.02(d).

7.16         Unrestricted Subsidiaries.  Permit any Unrestricted Subsidiary
(a) to hold any Equity Interest in, or Indebtedness of, the Borrower or
any Restricted Subsidiary or (b) engage in any line of business that is
not permitted for the Borrower and its Restricted Subsidiaries under
Section 7.07.

ARTICLE VIII

EVENTS OF DEFAULT AND REMEDIES

8.01         Events of Default.  Any of the following shall constitute an
Event of Default:

(a)           Non-Payment.  The Borrower or any other Loan Party fails to
(i) pay when and as required to be paid herein, any amount of principal of any
Loan or any L/C Obligation or deposit any funds as Cash Collateral in respect
of L/C Obligations, or (ii) pay within three Business Days after the same
becomes due, any interest on any Loan or on any L/C Obligation, or any fee due
hereunder, or (iii) pay within five Business

 

101

 

Days
after the same becomes due, any other amount payable hereunder or under any
other Loan Document; or

(b)           Specific
Covenants.  (i) The Borrower fails to perform or observe any term, covenant or
agreement contained in any of Section 6.03(a), 6.05(a), 6.10
or 6.11 or Article VII (subject, in the case of Section 7.11(b),
to cure by Specified Equity Contributions, to the extent that Specified Equity
Contributions are permitted to be included in Consolidated Adjusted EBITDA in
accordance with the definition thereof); or

(c)           Other Defaults.  Any Loan Party fails to perform or observe
any other covenant or agreement (not specified in Section 8.01(a) or (b)
above) contained in any Loan Document on its part to be performed or observed
and such failure continues for 30 days; or

(d)           Representations
and Warranties.  Any representation,
warranty, certification or statement of fact made or deemed made by or on
behalf of the Borrower or any other Loan Party herein, in any other Loan
Document, or in any document delivered in connection herewith or therewith
shall be incorrect in any material respect when made or deemed made; or

(e)           Cross-Default.  (i) Any Loan Party or any Restricted
Subsidiary thereof (A) fails to make any payment when due (whether by scheduled
maturity, required prepayment, acceleration, demand, or otherwise) in respect
of any Indebtedness or Guarantee (other than Indebtedness hereunder and
Indebtedness under Swap Contracts) having an aggregate principal amount
(including undrawn committed or available amounts and including amounts owing
to all creditors under any combined or syndicated credit arrangement) of more
than the Threshold Amount and such failure shall continue after any applicable
grace period, or (B) fails to observe or perform any other agreement or
condition relating to any such Indebtedness or Guarantee or contained in any
instrument or agreement evidencing, securing or relating thereto, or any other
event occurs, which, in any case, shall continue unremedied after any
applicable grace period, the effect of which default or other event is to
cause, or to permit the holder or holders of such Indebtedness or the
beneficiary or beneficiaries of such Guarantee (or a trustee or agent on behalf
of such holder or holders or beneficiary or beneficiaries) to cause, with the
giving of notice if required, such Indebtedness to be demanded or to become due
or to be repurchased, prepaid, defeased or redeemed (automatically or
otherwise), or an offer to repurchase, prepay, defease or redeem such
Indebtedness to be made, prior to its stated maturity, or such Guarantee to
become payable or cash collateral in respect thereof to be demanded; or (ii)
there occurs under any Swap Contract an Early Termination Date (as defined in
such Swap Contract) resulting from (A) any event of default under such Swap
Contract as to which a Loan Party or any Restricted Subsidiary thereof is the
Defaulting Party (as defined in such Swap Contract) or (B) any Termination
Event (as so defined) under such Swap Contract as to which a Loan Party or any
Restricted Subsidiary thereof is an Affected Party (as so defined) and, in
either event, the Swap Termination Value owed by such Loan Party or such
Restricted Subsidiary as a result thereof is greater than the Threshold Amount;
or

 

102

 

(f)            Insolvency
Proceedings, Etc.  Any Loan Party or
any Restricted Subsidiary thereof institutes or consents to the institution of
any proceeding under any Debtor Relief Law, or makes an assignment for the
benefit of creditors; or applies for or consents to the appointment of any
receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar
officer for it or for all or any material part of its property; or any
receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar
officer is appointed without the application or consent of such Person and the
appointment continues undischarged or unstayed for 60 calendar days; or any
proceeding under any Debtor Relief Law relating to any such Person or to all or
any material part of its property is instituted without the consent of such
Person and continues undismissed or unstayed for 60 calendar days, or an order
for relief is entered in any such proceeding; or

(g)           Inability to Pay
Debts; Attachment.  (i) Any Loan
Party or any Restricted Subsidiary thereof becomes unable or admits in writing
its inability or fails generally to pay its debts as they become due, or (ii)
any writ or warrant of attachment or execution or similar process is issued or
levied against all or any material part of the property of any such Person and
is not released, vacated or fully bonded within 60 days after its issue or
levy; or

(h)           Judgments.  There is entered against any Loan Party or
any Restricted Subsidiary thereof (i) one or more final judgments or orders for
the payment of money in an aggregate amount (as to all such judgments and
orders) exceeding the Threshold Amount (to the extent not covered by
independent third-party insurance as to which the insurer is rated at least “A”
by A.M. Best Company, has been notified of the potential claim and does not
dispute coverage), or (ii) any one or more non-monetary final judgments that
have, or could reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect and, in either case, (A) enforcement
proceedings are commenced by any creditor upon such judgment or order, or (B)
there is a period of 15 consecutive
days during which a stay of enforcement of such judgment, by reason of a
pending appeal or otherwise, is not in effect; or

(i)            ERISA.  (i) An ERISA Event occurs with respect to a
Pension Plan or Multiemployer Plan which has resulted or could reasonably be
expected to result in liability of the Borrower under Title IV of ERISA to
the Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount in
excess of the Threshold Amount, or (ii) the Borrower or any ERISA Affiliate
fails to pay when due, after the expiration of any applicable grace period, any
installment payment with respect to its withdrawal liability under Section 4201
of ERISA under a Multiemployer Plan in an aggregate amount in excess of the
Threshold Amount; or

(j)            Invalidity of
Loan Documents.  Any material
provision of any 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, ceases to be in full force and
effect; or any Loan Party or any other Person contests in any manner the
validity or enforceability of any provision of any Loan Document; or any Loan
Party denies that it has any or further liability or obligation under any
provision of

 

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any
Loan Document, or purports to revoke, terminate or rescind any provision of any
Loan Document; or

(k)           Change of Control.  There occurs any Change of Control.

8.02         Remedies upon Event of Default.  If any Event of Default occurs and is
continuing, the Administrative Agent shall, at the request of, or may, with the
consent of, the Required Lenders (in the case of clauses (b) and (d)), the
Required Revolving Lenders (in the case of a termination of the Revolving
Credit Commitments pursuant to clause (a) or in the case of clause (c)), the
Required Term Lenders (in the case of a termination of the Term Commitments
pursuant to clause (a)) or the Required Additional Term Facility Lenders (in
the case of a termination of the Additional Term Facility Commitments pursuant
to clause (a)), take any or all of the following actions:

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

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

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

(d)           exercise
on behalf of itself, the Lenders and the L/C Issuer all rights and remedies
available to it, the Lenders and the L/C Issuer under the Loan Documents;

provided, however,
that upon the occurrence of an actual or deemed entry of an order for relief
with respect to the Borrower under the Bankruptcy Code of the United States,
the obligation of each Lender to make Loans and any obligation of the L/C
Issuer to make L/C Credit Extensions shall automatically terminate, the unpaid
principal amount of all outstanding Loans and all interest and other amounts as
aforesaid shall automatically become due and payable, and the obligation of the
Borrower to Cash Collateralize the L/C Obligations as aforesaid shall
automatically become effective, in each case without further act of the
Administrative Agent or any Lender.

8.03         Application of Funds.  After the exercise of remedies provided for
in Section 8.02 (or after the Loans have automatically become immediately due
and payable and the L/C Obligations have automatically been required to be Cash
Collateralized as set forth in the proviso to Section 8.02), any amounts
received on account of the Obligations shall be applied by the Administrative
Agent in the following order:

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

 

104

 

Administrative Agent and amounts payable under Article III)
payable to the Administrative Agent in its capacity as such;

Second,
to payment of that portion of
the Obligations constituting fees, indemnities and other amounts (other than
principal, interest and Letter of Credit Fees) payable to the Lenders and
the L/C Issuer (including fees, charges and disbursements of counsel to the
respective Lenders and the L/C Issuer (including fees and time charges for
attorneys who may be employees of any Lender or the L/C Issuer)) and amounts payable under Article III,
ratably among them in proportion to the respective amounts described in this
clause Second payable to them;

Third,
to payment of that portion of the Obligations constituting accrued and unpaid
Letter of Credit Fees and interest on the Loans, L/C Borrowings and other
Obligations, ratably among the Lenders and the L/C Issuer in proportion to the
respective amounts described in this clause Third payable to them;

Fourth,
to payment of that portion of the Obligations constituting unpaid principal of
the Loans and L/C Borrowings, ratably among the Lenders and the L/C Issuer in
proportion to the respective amounts described in this clause Fourth
held by them;

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

Last,
the balance, if any, after all of the Obligations have been indefeasibly paid
in full, to the Borrower or as otherwise required by Law;

provided that Cash
Collateral shall be applied to the portion of the Obligations arising out of
the issuance of Letters of Credit prior to its application to the other
Obligations. Subject to Section 2.03(c), amounts used to Cash
Collateralize the aggregate undrawn amount of Letters of Credit pursuant to
clause Fifth above shall be applied to satisfy drawings under such
Letters of Credit as they occur.

ARTICLE IX

ADMINISTRATIVE AGENT

9.01         Appointment and Authority.

(a)           Each
of the Lenders and the L/C Issuer 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.  Each
of the Lenders and the L/C Issuer hereby authorizes and directs the
Administrative Agent to enter into the Escrow Documents, upon terms and
conditions reasonably acceptable to the Administrative Agent.  The provisions of this Article are solely for
the benefit of the Administrative Agent, the Lenders and the L/C Issuer, and

 

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neither the Borrower nor any
other Loan Party shall have rights as a third party beneficiary of any of such
provisions.

(b)           The
Administrative Agent shall also act as the “collateral agent” under the Loan Documents, and each of the
Lenders (in its capacities as a Lender or Swing Line Lender (if applicable) and
the L/C Issuer hereby irrevocably appoints and authorizes the Administrative
Agent to act as the agent of such Lender and the L/C Issuer for purposes of
acquiring, holding and enforcing any and all Liens on Collateral granted by any
of the Loan Parties to secure any of the Obligations, together with such powers
and discretion as are reasonably incidental thereto.  In this connection, the Administrative Agent,
as “collateral agent” and any co-agents, sub-agents and attorneys-in-fact
appointed by the Administrative Agent pursuant to Section 9.05 for
purposes of holding or enforcing any Lien on the Collateral (or any portion
thereof) granted under the Collateral Documents, or for exercising any rights
and remedies thereunder at the direction of the Administrative Agent), shall be
entitled to the benefits of all provisions of this Article IX and Article
X (including Section 10.04(c), as though such co-agents,
sub-agents and attorneys-in-fact were the “collateral agent” under the Loan
Documents) as if set forth in full herein with respect thereto.

9.02         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.

9.03         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,

 

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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 10.01 and 8.02) 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 notice describing such
Default is given to the Administrative Agent by the Borrower, a Lender or the
L/C Issuer.

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 genuineness of this Agreement, any
other Loan Document or any other agreement, instrument or document, or the
creation, perfection or priority of any Lien purported to be created by the
Collateral Documents, (v) the value or the sufficiency of any Collateral, or
(vi) 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.

9.04         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, or
the issuance of a Letter of Credit, that by its terms must be fulfilled to the
satisfaction of a Lender or the L/C Issuer, the Administrative Agent may
presume that such condition is satisfactory to such Lender or the L/C Issuer
unless the Administrative Agent shall have received notice to the contrary from
such Lender or the L/C Issuer prior to the making of such Loan or the issuance
of such Letter of Credit.  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.

9.05         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

 

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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.

9.06         Resignation of Administrative Agent.  The Administrative Agent may at any time give
notice of its resignation to the Lenders, the L/C Issuer and the Borrower.  Upon receipt of any such notice of
resignation, the Required Lenders shall have the right, with the written
consent of the Borrower so long as an Event of Default does not exist, which
consent shall not be unreasonably withheld or delayed, 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 and the L/C Issuer, 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 (a) the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder and under the other Loan Documents (except that in the case of any
collateral security held by the Administrative Agent on behalf of the Lenders
or the L/C Issuer under any of the Loan Documents, the retiring Administrative
Agent shall continue to hold such collateral security until such time as a
successor Administrative Agent is appointed) and (b) all payments,
communications and determinations provided to be made by, to or through the
Administrative Agent shall instead be made by or to each Lender and the L/C
Issuer 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 10.04 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.

Any resignation by Bank of America as Administrative Agent pursuant to
this Section shall also constitute its resignation as L/C Issuer and Swing Line
Lender.  Upon the acceptance of a
successor’s appointment as Administrative Agent hereunder, (i) such successor
shall succeed to and become vested with all of the rights, powers, privileges
and duties of the retiring L/C Issuer and Swing Line Lender, (ii) the retiring
L/C Issuer and Swing Line Lender shall be discharged from all of their
respective duties and obligations hereunder or under the other Loan Documents,
and (iii) the successor L/C Issuer shall issue letters of credit in
substitution for the Letters of Credit, if any, outstanding at the time of such
succession or make other arrangements satisfactory to the retiring L/C Issuer
to effectively assume the obligations of the retiring L/C Issuer with respect
to such Letters of Credit.

 

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9.07         Non-Reliance on Administrative Agent
and Other Lenders.  Each Lender and the
L/C Issuer 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 and the L/C Issuer 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.

9.08         No Other Duties, Etc.  Anything herein to the contrary
notwithstanding, none of the Arranger or other agents listed on the cover page
hereof shall have any powers, duties or responsibilities under this Agreement
or any of the other Loan Documents, except in its capacity, as applicable, as
the Administrative Agent, a Lender or the L/C Issuer hereunder.

9.09         Administrative Agent May File Proofs
of Claim.  In case of the pendency of
any proceeding under any Debtor Relief Law or any other judicial proceeding
relative to any Loan Party, the Administrative Agent (irrespective of whether
the principal of any Loan or L/C Obligation shall then be due and payable as
herein expressed or by declaration or otherwise and irrespective of whether the
Administrative Agent shall have made any demand on the Borrower) shall be
entitled and empowered, by intervention in such proceeding or otherwise

(a)           to file and prove a
claim for the whole amount of the principal and interest owing and unpaid in
respect of the Loans, L/C Obligations and all other Obligations that are owing
and unpaid and to file such other documents as may be necessary or advisable in
order to have the claims of the Lenders, the L/C Issuer and the Administrative
Agent (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Lenders, the L/C Issuer and the
Administrative Agent and their respective agents and counsel and all other
amounts due the Lenders, the L/C Issuer and the Administrative Agent under Sections
2.03(i) and (j), 2.09 and 10.04) allowed in such
judicial proceeding; and

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

and
any custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official in any such judicial proceeding is hereby authorized by each
Lender and the L/C Issuer to make such payments to the Administrative Agent
and, if the Administrative Agent shall consent to the making of such payments
directly to the Lenders and the L/C Issuer, to pay to the Administrative Agent
any amount due for the reasonable compensation, expenses, disbursements and
advances of the Administrative Agent and its agents and counsel, and any other
amounts due the Administrative Agent under Sections 2.09 and 10.04.

Nothing contained herein shall be deemed to authorize the
Administrative Agent to authorize or consent to or accept or adopt on behalf of
any Lender or the L/C Issuer any plan of reorganization, arrangement,
adjustment or composition affecting the Obligations or the rights of

 

109

 

any Lender or the L/C Issuer to authorize the Administrative Agent to
vote in respect of the claim of any Lender or the L/C Issuer or in any such
proceeding.

9.10         Collateral and Guaranty Matters.  The Lenders and the L/C Issuer irrevocably
authorize the Administrative Agent, at its option and in its discretion,

(a)           to release any Lien
on any property granted to or held by the Administrative Agent under any Loan
Document (i) upon termination of the Aggregate Commitments and payment in full
of all Obligations (other than contingent indemnification obligations) and the
expiration or termination of all Letters of Credit, (ii) that is sold or to be
sold as part of or in connection with any sale permitted hereunder or under any
other Loan Document, or (iii)  if
approved, authorized or ratified in writing in accordance with Section 10.01;

(b)           to release any
Guarantor from its obligations under the Guaranty if such Person ceases to be a
Subsidiary as a result of a transaction permitted hereunder; and

(c)           to subordinate any
Lien on any property granted to or held by the Administrative Agent under any
Loan Document to the holder of any Lien on such property that is permitted by Section
7.01(i).

Upon request by the Administrative Agent at any time, the Required
Lenders will confirm in writing the Administrative Agent’s authority to release
or subordinate its interest in particular types or items of property, or to
release any Guarantor from its obligations under the Guaranty pursuant to this Section
9.10.  In each case as specified in
this Section 9.10, the Administrative Agent will, at the Borrower’s
expense, execute and deliver to the applicable Loan Party such documents as
such Loan Party may reasonably request to evidence the release of such item of
Collateral from the assignment and security interest granted under the
Collateral Documents or to subordinate its interest in such item, or to release
such Guarantor from its obligations under the Guaranty, in each case in
accordance with the terms of the Loan Documents and this Section 9.10.

ARTICLE X

MISCELLANEOUS

10.01       Amendments, Etc.  No amendment or waiver of any provision of
this Agreement or any other Loan Document, and no consent to any departure by
the Borrower or any other Loan Party therefrom, shall be effective unless in
writing signed by the Required Lenders and the Borrower or the applicable Loan
Party, as the case may be, and acknowledged by the Administrative Agent, and
each such waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given; provided, however, that no such
amendment, waiver or consent shall:

(a)           waive any condition
set forth in Section 4.01 (other than Section 4.01(b)(i) or (c)),
or, in the case of the initial Credit Extension, Section 4.02,
without the written consent of each Lender;

 

110

 

(b)           without limiting the generality of clause (a) above, waive any
condition set forth in Section 4.02 as to any Credit Extension under the
Revolving Credit Facility without the written consent of the Required Revolving
Lenders;

(c)           extend or increase
the Commitment of any Lender (or reinstate any Commitment terminated pursuant
to Section 8.02) without the written consent of such Lender;

(d)           postpone any date
fixed by this Agreement or any other Loan Document for any payment  (excluding mandatory prepayments) of principal, interest,
fees or other amounts due to the Lenders (or any of them) hereunder or under
such other Loan Document without the written consent of each Lender entitled to
such payment;

(e)           reduce the principal
of, or the rate of interest specified herein on, any Loan or L/C Borrowing, or
(subject to clause (iv) of the second
proviso to this Section 10.01) any fees or other amounts payable
hereunder or under any other Loan Document,
without the written consent of each Lender entitled to such amount; provided,
however, that only the consent of the Required Lenders shall be
necessary (i) to amend the definition of “Default Rate” or to waive any
obligation of the Borrower to pay interest or Letter of Credit Fees at the
Default Rate, and (ii) to amend
any financial covenant hereunder (or any defined term used therein) even if the
effect of such amendment would be to reduce the rate of interest on any Loan or
L/C Borrowing or to reduce any fee payable hereunder;

(f)            change (i) Section
8.03 or Section 2.13 in a manner that would alter the pro rata
sharing required thereby without the written consent of each Lender or (ii) the
order of application of any reduction in the Commitments or any prepayment of
Loans among the Facilities from the application thereof set forth in the
applicable provisions of Section 2.05(b) or 2.06(b),
respectively, in any manner that materially and adversely affects the Lenders
under a Facility without the written consent of (i) if such Facility is
the Term Facility, the Required Term Lenders, (ii) if such Facility is the
Revolving Credit Facility, the Required Revolving Lenders, and (iii) if
such Facility is an Additional Term Facility, the Required Additional Term
Facility Lenders under such Facility;

(g)           change (i) any
provision of this Section 10.01 or the definition of “Required Lenders”
or any other provision hereof specifying the number or percentage of Lenders
required to amend, waive or otherwise modify any rights hereunder or make any
determination or grant any consent hereunder (other than the definitions
specified in clause (ii) of this Section 10.01(g)), without the written
consent of each Lender or (ii) the definition of “Required Revolving Lenders,” “Required
Term Lenders” or “Required Additional Term Lenders” without the written consent
of each Lender under the applicable Facility;

(h)           amend the definition
of “Rating Condition” or, at any time that a Rating Condition exists, release
all or substantially all of the Collateral in any transaction or series of
related transactions, without the written consent of each Lender;

 

111

 

(i)            release all or
substantially all of the Guarantors from liability under the Guaranty, without
the written consent of each Lender, except to the extent the release of any
Guarantor from the Guaranty is permitted pursuant to Section 9.10 (in
which case such release may be made by the Administrative Agent acting alone);
or

(j)            impose any greater
restriction on the ability of any Lender under a Facility to assign any of its
rights or obligations hereunder without the written consent of (i) if such
Facility is the Term Facility, the Required Term Lenders, (ii) if such Facility is an Additional Term Facility, the Required
Additional Term Facility Lenders under such Facility, and (iii) if
such Facility is the Revolving Credit Facility, the Required Revolving Lenders;

and provided, further, that (i) no amendment, waiver or
consent shall, unless in writing and signed by the L/C Issuer in addition to
the Lenders required above, affect the rights or duties of the L/C Issuer under
this Agreement or any Issuer Document relating to any Letter of Credit issued
or to be issued by it; (ii) no amendment, waiver or consent shall, unless in
writing and signed by the Swing Line Lender in addition to the Lenders required
above, affect the rights or duties of the Swing Line Lender under this
Agreement; (iii) no amendment, waiver or consent shall, unless in writing and
signed by the Administrative Agent in addition to the Lenders required above,
affect the rights or duties of the Administrative Agent under this Agreement or
any other Loan Document; (iv) the Fee Letter may be amended, or rights or
privileges thereunder waived, in a writing executed only by the parties
thereto; and (v) any amendment or supplement to this Agreement executed in
connection with any Additional Term Facility may be amended, or rights or
privileges thereunder waived, in a writing executed only by the parties to such
amendment or supplement.  Notwithstanding
anything to the contrary herein, no Defaulting Lender shall have any right to
approve or disapprove any amendment, waiver or consent hereunder, except that
the Commitment of such Lender may not be increased or extended without the
consent of such Lender.

                If any Lender does not consent to a proposed amendment, waiver, consent
or release with respect to any Loan Document that requires the consent of each
Lender and that has been approved by the Required Lenders, the Borrower may
replace such non-consenting Lender in accordance with Section 10.13; provided
that such amendment, waiver, consent or release can be effected as a result of
the assignment contemplated by such Section (together with all other such
assignments required by the Borrower to be made pursuant to this paragraph).

10.02       Notices;
Effectiveness; Electronic Communications.

(a)           Notices
Generally.  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:

 

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(i)            if to the Borrower,
the Administrative Agent, the L/C Issuer or the Swing Line Lender, to the
address, telecopier number, electronic mail address or telephone number
specified for such Person on Schedule 10.02; and

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

Notices sent by hand or overnight courier service, or mailed by
certified or registered mail, shall be deemed to have been given when received;
notices 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 delivered
through electronic communications to the extent provided in subsection (b)
below shall be effective as provided in such subsection (b).

(b)           Electronic
Communications.  Notices and other communications to the
Lenders and the L/C Issuer hereunder 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 or the L/C Issuer
pursuant to Article II if such Lender or the L/C Issuer, 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.  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

 

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PARTY RIGHTS OR FREEDOM FROM VIRUSES OR
OTHER CODE DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTION WITH THE 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, the L/C
Issuer 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, the L/C Issuer or any other Person for indirect, special, incidental,
consequential or punitive damages (as opposed to direct or actual damages).

(d)           Change of
Address, Etc.  Each of the Borrower, the Administrative
Agent, the L/C Issuer and the Swing Line 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, the
Administrative Agent, the L/C Issuer and the Swing Line Lender.  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)           Reliance by
Administrative Agent, L/C Issuer and Lenders.  The
Administrative Agent, the L/C Issuer and the Lenders shall be entitled to rely
and act upon any notices (including telephonic Committed Loan Notices and Swing
Line Loan 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, the L/C Issuer, 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

 

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recorded by the Administrative Agent,
and each of the parties hereto hereby consents to such recording.

10.03       No Waiver; Cumulative Remedies.  No failure by any Lender, the L/C Issuer or
the Administrative Agent to exercise, and no delay by any such Person in
exercising, any right, remedy, power or privilege hereunder or under any other
Loan Document shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, remedy, power or privilege hereunder preclude
any other or further exercise thereof or the exercise of any other right,
remedy, power or privilege.  The rights,
remedies, powers and privileges herein provided, and provided under each other
Loan Document, are cumulative and not exclusive of any rights, remedies, powers
and privileges provided by law.

10.04       Expenses; Indemnity; Damage Waiver.

(a)           Costs
and Expenses.  The Borrower shall pay (i) all
reasonable and reasonably documented out-of-pocket expenses incurred by the
Administrative Agent and its Affiliates (including the reasonable and
reasonably documented 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), (ii) all reasonable and reasonably documented out-of-pocket
expenses incurred by the L/C Issuer in connection with the issuance, amendment,
renewal or extension of any Letter of Credit or any demand for payment
thereunder and (iii) all out-of-pocket expenses incurred by
the Administrative Agent, any Lender or the L/C Issuer (including the fees,
charges and disbursements of any counsel for the Administrative Agent, any
Lender or the L/C Issuer), 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 Loans made
or Letters of Credit issued hereunder, including all such out-of-pocket
expenses incurred during any workout, restructuring or negotiations in respect
of such Loans or Letters of Credit.

(b)           Indemnification
by the Borrower.  Without limiting Section 10.04(a), the
Borrower shall indemnify the Administrative Agent (and any sub-agent thereof),
each Lender and the L/C Issuer, 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 expenses relating thereto (including the reasonable and
reasonably documented 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 or any other Loan Party arising out of, in
connection with, or as a result of (i) the execution or delivery of this
Agreement, any other Loan Document or any agreement or instrument contemplated
hereby or thereby, the performance by the parties hereto of their respective obligations
hereunder or thereunder or the consummation of the transactions contemplated
hereby or thereby, or, in the case of the Administrative Agent (and any
sub-agent thereof) and its Related Parties only, the administration of this
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Loan or Letter of Credit or the use of
the proceeds therefrom (including any refusal by the L/C Issuer to honor a
demand for payment under a Letter of Credit if the documents presented in
connection with such demand do not strictly comply with the terms of such
Letter of Credit), (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 Restricted Subsidiaries, or any Environmental Liability related
in any way to the Borrower or any of its Restricted 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 or any
other Loan Party or any of the Borrower’s or such Loan Party’s directors, shareholders
or creditors, and
regardless of whether any Indemnitee is a party thereto, IN ALL CASES, WHETHER OR NOT CAUSED BY OR ARISING,
IN WHOLE OR IN PART, OUT OF THE COMPARATIVE, CONTRIBUTORY OR SOLE NEGLIGENCE OF
THE INDEMNITEE; 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 or any other Loan Party against an
Indemnitee for breach in bad faith of such Indemnitee’s obligations hereunder
or under any other Loan Document, if the Borrower or such Loan Party has
obtained a final and nonappealable judgment in its favor on such claim as
determined by a court of competent jurisdiction.

(c)           Reimbursement
by Lenders.  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 Administrative Agent (or
any sub-agent thereof), the L/C Issuer or any Related Party of any of the
foregoing, each Lender (or Revolving Credit Lender, in the case of such
payments to the L/C Issuer or its Related Parties) severally agrees to pay to
the Administrative Agent (or any such sub-agent), the L/C Issuer or such
Related Party, as the case may be, such Lender’s (or Revolving Credit Lender’s,
as applicable) pro-rata share (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) or the L/C Issuer in its capacity
as such, or against any Related Party of any of the foregoing acting for the
Administrative Agent (or any such sub-agent) or L/C Issuer in connection with
such capacity.  The obligations of the
Lenders under this subsection (c) are subject to the provisions of Section 2.12(d).

(d)           Waiver of
Consequential Damages, Etc.  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 Letter of Credit 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

 

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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 bad faith, gross negligence or willful misconduct of such
Indemnitee.

(e)           Payments.  All amounts due
under this Section shall be payable not later than ten Business Days after
demand therefor.

(f)            Survival.  The agreements in
this Section shall survive the resignation of the Administrative Agent, the L/C Issuer and the Swing
Line Lender, the replacement of any Lender,
the termination of the Aggregate Commitments and the repayment, satisfaction or
discharge of all the other Obligations.

10.05       Payments Set Aside.  To the extent that any payment by or on
behalf of the Borrower is made to the Administrative Agent, the L/C Issuer or
any Lender, or the Administrative Agent, the L/C Issuer or any Lender exercises
its right of setoff, and such payment or the proceeds of such setoff or any
part thereof is subsequently invalidated, declared to be fraudulent or
preferential, set aside or required (including pursuant to any settlement
entered into by the Administrative Agent, the L/C Issuer or such Lender in its
discretion) to be repaid to a trustee, receiver or any other party, in
connection with any proceeding under any Debtor Relief Law or otherwise, then
(a) to the extent of such recovery, the obligation or part thereof originally
intended to be satisfied shall be revived and continued in full force and
effect as if such payment had not been made or such setoff had not occurred,
and (b) each Lender and the L/C Issuer severally agrees to pay to the
Administrative Agent upon demand its applicable share (without duplication) of
any amount so recovered from or repaid by the Administrative Agent, plus
interest thereon from the date of such demand to the date such payment is made
at a rate per annum equal to the Federal Funds Rate from time to time in
effect.  The obligations of the Lenders
and the L/C Issuer under clause (b) of the preceding sentence shall survive the
payment in full of the Obligations and the termination of this Agreement.

10.06       Successors and Assigns.

(a)           Successors
and Assigns Generally.  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 Section 10.06(b), (ii) by
way of participation in accordance with the provisions of Section 10.06(d),
or (iii) by way of pledge or assignment of a security interest subject to the
restrictions of Section 10.06(f) (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
Administrative

 

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

(b)           Assignments
by Lenders.  Any Lender may at any time 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(s) and the Loans
(including for purposes of this Section 10.06(b), participations in L/C
Obligations and in Swing Line 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 under any Facility and the Loans at the time
owing to it under such Facility 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, in the case of any assignment in respect of the Revolving Credit
Facility, or $1,000,000, in the case of any assignment in respect of the Term
Facility or an Additional Term Facility, unless each of the Administrative
Agent and, so long as no Event of Default under Section 8.01(a) or 8.01(f)
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, except that this clause (ii) shall not (A) apply to the Swing Line
Lender’s rights and obligations in respect of Swing Line Loans or (B) prohibit
any Lender from assigning all or a portion of its rights and obligations among
separate Facilities on a non-pro rata basis.

 

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(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:

(A)          the consent of the Borrower (such consent not to be
unreasonably withheld or delayed) shall be required unless (1) an Event of
Default under Section 8.01(a) or 8.01(f) 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;

(B)           the consent of the Administrative Agent (such consent not
to be unreasonably withheld or delayed) shall be required for assignments in
respect of (1) any Term Commitment, Additional Term Facility Commitment or
Revolving Credit Commitment if such assignment is to a Person that is not a
Lender with a Commitment in respect of the applicable Facility, an Affiliate of
such Lender or an Approved Fund with respect to such Lender or (2) any Term
Loan, Revolving Credit Loan or Additional Term Facility Loan to a Person that is
not a Lender, an Affiliate of a Lender or an Approved Fund;

(C)           the consent of the L/C Issuer (such consent not to be
unreasonably withheld or delayed) shall be required for any assignment that
increases the obligation of the assignee to participate in exposure under one
or more Letters of Credit (whether or not then outstanding); and

(D)          the consent of the Swing Line Lender (such consent not to
be unreasonably withheld or delayed) shall be required for any assignment in
respect of the Revolving Credit Facility.

(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
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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 3.01, 3.04, 3.05
and 10.04 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 Section 10.06(d).

(c)           Register.  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 and L/C Obligations owing to, each Lender pursuant to the terms hereof
from time to time (the “Register”).  The entries in
the Register shall be conclusive absent manifest error, 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)           Participations.  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
(including such Lender’s participations in L/C Obligations and/or Swing Line
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, the Lenders
and the L/C Issuer 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 10.01 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 3.01, 3.04 and 3.05  to the same extent as if it were a Lender and had acquired
its interest by assignment pursuant to Section 10.06(b).  To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 10.08  as though it were a Lender, provided such
Participant agrees to be subject to Section 2.13 as though it were a
Lender.

 

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(e)           Limitations
upon Participant Rights.  A Participant shall not be entitled to
receive any greater payment under Section 3.01 or 3.04  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 3.01 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 3.01(e) as though it
were a Lender.

(f)            Certain
Pledges.  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.

(g)           Electronic
Execution of Assignments.  The words “execution,” “signed,” “signature,”
and words of like import in any Assignment and Assumption shall be deemed to
include electronic signatures or the keeping of records in electronic form,
each of which shall be of the same legal effect, validity or enforceability as
a manually executed signature or the use of a paper-based recordkeeping system,
as the case may be, to the extent and as provided for in any applicable law,
including the Federal Electronic Signatures in Global and National Commerce
Act, the New York State Electronic Signatures and Records Act, or any other
similar state laws based on the Uniform Electronic Transactions Act.

(h)           Resignation as L/C Issuer or Swing Line Lender after
Assignment.  Notwithstanding anything
to the contrary contained herein, if at any time Bank of America assigns all of
its Revolving Credit Commitment and Revolving Credit Loans pursuant to Section
10.06(b), Bank of America may, (i) upon 30 days’ notice to the Borrower and the Lenders, resign as L/C
Issuer and/or (ii) upon 30 days’
notice to the Borrower, resign as Swing Line Lender.  In the event of any such resignation as L/C
Issuer or Swing Line Lender, the Borrower shall be entitled to appoint from
among the Lenders (with the consent of the appointed Lender) a successor L/C
Issuer or Swing Line Lender hereunder; provided, however, that no
failure by the Borrower to appoint any such successor shall affect the
resignation of Bank of America as L/C Issuer or Swing Line Lender, as the case
may be.  If Bank of America resigns as
L/C Issuer, it shall retain all the rights, powers, privileges and duties of
the L/C Issuer hereunder with respect to all Letters of Credit outstanding as
of the effective date of its resignation as L/C Issuer and all L/C Obligations
with respect thereto (including the right to require the Lenders to make Base
Rate Loans or fund risk participations in Unreimbursed Amounts pursuant to Section
2.03(c)).  If Bank of America resigns
as Swing Line Lender, it shall retain all the rights of the Swing Line Lender
provided for hereunder with respect to Swing Line Loans made by it and
outstanding as of the effective date of such resignation, including the right
to require the Lenders to make Base Rate Loans or fund risk participations in
outstanding Swing Line Loans pursuant to Section 2.04(c).  Upon the appointment of a successor L/C
Issuer and/or Swing Line Lender, (a) such successor shall succeed to and become
vested

 

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with all of the rights,
powers, privileges and duties of the retiring L/C Issuer or Swing Line Lender,
as the case may be, and (b) the successor L/C Issuer shall issue letters of
credit in substitution for the Letters of Credit, if any, outstanding at the
time of such succession or make other arrangements reasonably satisfactory to
Bank of America to effectively assume the obligations of Bank of America with
respect to such Letters of Credit.

10.07       Treatment of Certain Information;
Confidentiality.  Each of the
Administrative Agent, the Lenders and the L/C Issuer 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, 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 2.14, 2.15 or 2.16 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 (i) becomes publicly available
other than as a result of a breach of this Section or (ii) becomes
available to the Administrative Agent, any Lender, the L/C Issuer 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 any Loan Party or any Restricted Subsidiary thereof relating to
any Loan Party or any Restricted Subsidiary thereof or their respective
businesses, other than any such information that is available to the
Administrative Agent, any Lender or the L/C Issuer on a nonconfidential basis
prior to disclosure by any Loan Party or any Restricted Subsidiary thereof, provided
that, in the case of information received from a Loan Party or any such
Restricted 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, the Lenders and the L/C Issuer
acknowledges that (a) the Information may include material non-public
information concerning the Borrower or a Restricted 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.

 

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10.08       Right of Setoff.  If an Event of Default shall have occurred
and be continuing, each Lender and the L/C Issuer are hereby authorized at any
time and from time to time, to the fullest extent permitted by applicable law,
to set off and apply any and all deposits (general or special, time or demand,
provisional or final, in whatever currency) at any time held and other
obligations (in whatever currency) at any time owing by such Lender or the L/C
Issuer to or for the credit or the account of the Borrower or any other Loan
Party against the Obligations, irrespective of whether or not such Lender or
the L/C Issuer shall have made any demand under this Agreement or any other
Loan Document and although such Obligations may be contingent or unmatured or
are owed to a branch or office of such Lender or the L/C Issuer different from
the branch or office holding such deposit or obligated on such
indebtedness.  The rights of each Lender
and the L/C Issuer under this Section are in addition to other rights and
remedies (including other rights of setoff) that such Lender or the L/C Issuer
may have.  Each Lender and the L/C Issuer
agree to notify the Borrower and the Administrative Agent promptly after any
such setoff and application, provided that the failure to give such notice
shall not affect the validity of such setoff and application.  Notwithstanding the provisions of this
Section 10.08, if at any time any Lender or the L/C Issuer maintains one or
more deposit accounts for the Borrower or any other Loan Party into which
Medicare and/or Medicaid receivables are deposited, such Person shall waive the
right of setoff set forth herein.

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

10.10       Counterparts; Integration;
Effectiveness.  This Agreement may be
executed in counterparts (and by different parties hereto in 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 that, when taken together, bear the signatures of each of
the other parties hereto.  Delivery of an
executed counterpart of a signature page of this Agreement by telecopy shall be
effective as delivery of a manually executed counterpart of this Agreement.

10.11       Survival of Representations and
Warranties.  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

 

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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 other Obligation hereunder shall remain unpaid or unsatisfied
or any Letter of Credit shall remain outstanding.

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

10.13       Replacement of Lenders.  If any Lender requests compensation under
Section 3.04, 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 3.01, or if a Lender (a “Non-Consenting Lender”) does not consent to
a proposed change, waiver, discharge or termination with respect to any Loan
Document that has been approved by the Required Lenders as provided in Section
10.01 but also requires the unanimous consent of all Lenders or all Lenders
directly affected thereby (as applicable, or if any Lender is a Defaulting
Lender or if any other circumstance exists hereunder that gives the Borrower
the right to replace a Lender as a party hereto, then the Borrower may, at its
sole expense and effort, upon notice to such Lender and the Administrative
Agent, require such Lender, within 30 days of notice by the Administrative
Agent, to assign and delegate, without recourse (in accordance with and subject
to the restrictions contained in, and consents required by, Section 10.06), all
of 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:

(a)           the
Borrower shall have paid to the Administrative Agent the assignment fee
specified in Section 10.06(b);

(b)           such
Lender shall have received payment of an amount equal to the outstanding
principal of its Loans (including, for this purpose, its funded participations
in Swing Line Loans) and L/C Advances, accrued interest thereon, accrued fees
and all other amounts payable to it hereunder and under the other Loan
Documents (including any amounts under Section 3.05) 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);

(c)           in
the case of any such assignment resulting from a claim for compensation under Section
3.04 or payments required to be made pursuant to

 

124

 

Section 3.01, such assignment will result in a reduction
in such compensation or payments thereafter;

(d)           such
assignment does not conflict with applicable Laws in any respect that calls
into question the validity or enforceability of such assignment or could
reasonably be expected to subject the assignor or assignee to any liability
that is not indemnified by the Borrower hereunder; and

(e)           in
the case of any such assignment resulting from a Non-Consenting Lender’s
failure to consent to a proposed change, waiver, discharge or termination with
respect to any Loan Document, the applicable assignee consents to the proposed
change, waiver, discharge or termination.

A Lender shall not be required to make any such assignment or
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.

10.14       Governing
Law; Jurisdiction; Etc.

(a)           GOVERNING
LAW.  THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD
TO THE CONFLICTS OF LAWS PRINCIPLES THEREOF THAT WOULD REQUIRE THE APPLICATION
OF THE LAW OF ANOTHER JURISDICTION.

(b)           SUBMISSION TO
JURISDICTION.  THE BORROWER 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 CITY AND OF THE UNITED STATES
DISTRICT COURT IN THE BOROUGH OF MANHATTAN IN NEW YORK CITY, 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 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 FULLEST EXTENT PERMITTED BY APPLICABLE 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, ANY LENDER OR THE L/C ISSUER 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.

 

125

(c)           WAIVER OF
VENUE.  THE BORROWER IRREVOCABLY AND UNCONDITIONALLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT
IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY 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 APPLICABLE LAW, THE DEFENSE OF AN
INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH
COURT.

(d)           SERVICE OF
PROCESS.  EACH PARTY HERETO IRREVOCABLY CONSENTS TO
SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 10.02.  NOTHING IN THIS AGREEMENT WILL AFFECT THE
RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY
APPLICABLE LAW.

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

10.16       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 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

 

126

 

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.

10.17       USA PATRIOT Act Notice.  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 each Loan Party, which information includes the name and
address of each Loan Party and other information that will allow such Lender or
the Administrative Agent, as applicable, to identify each Loan Party in
accordance with the Act.

10.18       Time of the Essence.  Time is of the essence of the Loan Documents.

10.19       ENTIRE AGREEMENT. THIS AGREEMENT
AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES
AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. 
THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.

 

127

 

IN WITNESS WHEREOF, the parties hereto have
caused this Agreement to be duly executed as of the date first above written.

 

	
   

  	
  BORROWER:

  
	
   

  	
   

  	
   

  
	
   

  	
  UNIVERSAL AMERICAN FINANCIAL CORP.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
				

 

	
   

  	
  BANK
  OF AMERICA, N.A., as

  
	
   

  	
  Administrative
  Agent

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

	
   

  	
  BANK
  OF AMERICA, N.A., as a Lender, L/C Issuer and Swing Line Lender

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

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Exhibit 10.2    
    

 
 

First Amendment to the DRS Technologies, Inc. Incentive Compensation Plan
  (effective as of November 8, 2007)    
    

The
First Amendment deletes Section 6 in its entirety and replaces it with the following: 

        6.    Time and Form of Payment.    Unless otherwise determined by the Committee, all payments in respect of Awards
granted under this Plan shall be made, in cash, within a reasonable period after the end of the Performance Period; provided, however, that in no event shall such payments be made later than the 15th
day of the third month following the end of the taxable year (of the Company or the Participant, whichever is later) in which the Performance Goals have been achieved (except in the case of certain
unforeseen events, as set forth in regulations issued under Section 409A). In addition, in the case of Participants who are Covered Employees, unless otherwise determined by the Committee, such
payments shall be made only after achievement of the Performance Goals has been certified by the Committee. 

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Exhibit 10.2

First Amendment to the DRS Technologies, Inc. Incentive Compensation Plan (effective as of November 8, 2007)

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