Document:

Prepared by R.R. Donnelley Financial -- Amendment No. 2 to Loan Agreement

  
 Exhibit 10.1 
  
 AMENDMENT NO. 2 TO LOAN AGREEMENT 
  
 This Amendment No. 2 (the
“Amendment”) dated as of April 29, 2002, is between Bank of America, N.A. (the “Bank”) and U.S. Laboratories, Inc. (the “Borrower”). 
  
 RECITALS 
  
 A.    The Bank and the Borrower
entered into a certain Business Loan Agreement (Receivables) dated as of March 29, 2001 (together with any previous amendments, the “Agreement”). 
  
 B.    The Bank and the Borrower desire to amend the Agreement. 
  
 AGREEMENT 
  
 1.    Definitions. Capitalized terms used but not defined in this
Amendment shall have the meaning given to them in the Agreement. 
  
 2.    Amendments. The Agreement is
hereby amended as follows: 
  
 2.1    In Subparagraph 1.2(b) of the Agreement, the amount
“One Million Dollars ($1,000,000)” is substituted for the amount “Four Hundred Thousand Dollars ($400,000).” 
  
 2.2    In Paragraph 1.3 of the Agreement, the amount “Twelve Million Dollars ($12,000,000)” is substituted for the amount “Six Million and 00/1000 Dollars ($6,000,000).”

  
 2.3    The first sentence of Subparagraph 2.1(b) of the Agreement is amended to read in
its entirety as follows: 
  
 “This is a revolving line of credit providing for cash advances and letters of
credit.” 
  
 2.4    The first sentence of Subparagraph 2.1(c) of the Agreement is
amended to read in its entirety as follows: 
  
 “The Borrower agrees not to permit the outstanding principal
balance of advances under the line of credit plus the outstanding amounts of any letters of credit, including amounts drawn on letters of credit and not yet reimbursed), to exceed the Facility No. 1 Commitment.” 
  
 2.5    In Paragraph 2.2 of the Agreement, the date “May 31, 2004” is substituted for the date “May
31, 2003.” 
  
 2.6    Subparagraph 2.3(a) of the Agreement is amended to read in its
entirety as follows: 
 

 1 

  
 “(a)  Unless the Borrower elects an optional interest rate as
described below, the interest rate is the Bank’s Prime Rate minus .25 percentage points.” 
  
 2.7 A new
Paragraph 2.6 is added to the Agreement, which reads in its entirety as follows: 
  
 “2.6    Letters of Credit. 
  
 (a)  This line of credit may be
used for financing standby letters of credit with a maximum maturity of 365 days but not to extend beyond the Facility No. 1 Expiration Date. The amount of letters of credit outstanding at any one time (including amounts drawn on letters of credit
and not yet reimbursed) may not exceed Two Million Dollars ($2,000,000). 
  
 (b)  The Borrower agrees:

  
 (i)  any sum drawn under a letter of credit may, at the option of the Bank, be added to the
principal amount outstanding under this Agreement. The amount will bear interest and be due as described elsewhere in this Agreement. 
  
 (ii)  if there is a default under this Agreement, to immediately prepay and make the Bank whole for any outstanding letters of credit. 
  
 (iii)  the issuance of any letter of credit and any amendment to a letter of credit is subject to the Bank’s written approval and must be in form and
content satisfactory to the Bank and in favor of a beneficiary acceptable to the Bank. 
  
 (iv)  to
sign the Bank’s form Application and Agreement for Standby Letter of Credit. 
  
 (v)  to pay any
issuance and/or other fees that the Bank notifies the Borrower will be charged for issuing and processing letters of credit for the Borrower. 
  
 (vi)  to allow the Bank to automatically charge its checking account for applicable fees, discounts, and other charges. 
  
 (vii)  to pay the Bank a non-refundable fee equal to 1.25% per annum of the outstanding undrawn amount of each standby letter of credit, payable annually in
advance, calculated on the basis of the face amount outstanding on the day the fee is calculated.” 
 

 2 

  
 2.8    A new Subparagraph 5.1(c) is added to the
Agreement, which reads in its entirety as follows: 
  
 “(c)  Unused Commitment Fee. The
Borrower agrees to pay a fee on any difference between the Credit Limit and the amount of credit it actually uses, determined by the weighted average credit outstanding during the specified period. The fee will be calculated at .125% per year. The
calculation of credit outstanding shall include the undrawn amount of letters of credit. This fee is due on June 30, 2002, and on the last day of each following quarter until the expiration of the availability period.” 
  
 2.9    Two new sentences are added at the end of Paragraph 6.2 of the Agreement which reads as follows:

  
 “The Borrower’s obligation to the Bank under this Agreement will be secured by personal property
now owned or owned in the future by Terra-Mar, Inc. and Robert W. Hunt Company, as listed below. Any reference to the ‘Subsidiaries’ shall be deemed to include Terra-Mar, Inc. and Robert W. Hunt Company.” 
  
 2.10    Paragraph 8.4 of the Agreement is amended to read in its entirety as follows: 
  
 “8.4 Guaranties. Guaranties signed by (i) Professional Engineering & Inspection Company, Inc., (ii) U.S. Engineering
Laboratories Inc., (iii) San Diego Testing Engineers, Inc., (iv) Los Angeles Testing Engineers, Inc., (v) Testing Engineers Nevada, Inc., (vi) Unitek Technical Services, Inc., (vii) Earth Consultants, Inc., (viii) Terra-Mar, Inc., and (ix) Robert W.
Hunt Company, each in the amount of Twelve Million One Hundred Forty Thousand Dollars ($12,140,000).” 
  
 2.11    Subparagraph 10.2(d) of the Agreement is amended to read in its entirety as follows: 
  
 “(d)  When the sum of outstanding principal balance under the Facility No. 1 plus the amount of letters of credit outstanding at any one time (including amounts drawn on letters of credit and not yet
reimbursed) exceeds Five Million Dollars ($5,000,000) in any month, a borrowing certificate setting forth the amount of Acceptable Receivables as of the last day of such month within 20 days after such month end.” 
  
 2.12    A new Subparagraph 10.2(g) is added to the Agreement, which reads in its entirety as follows:

  
 “(g)  Within the periods provided in (a) and (b) above, a compliance certificate of the
Borrower signed by an authorized financial 
 

 3 

  
 officer of the Borrower setting forth (i) the information and computations
(in sufficient detail) to establish that the Borrower is in compliance with all financial covenants at the end of the period covered by the financial statements then being furnished and (ii) whether there existed as of the date of such financial
statements and whether there exists as of the date of the certificate, any default under this Agreement and, if any such default exists, specifying the nature thereof and the action the Borrower is taking and proposes to take with respect
thereto.” 
  
 2.13    Paragraph 10.3 of the Agreement is deleted in its entirety.

  
 2.14    Paragraphs 10.4, 10.5 and 10.6 of the Agreement are amended to read in their
entirety as follows: 
  
 “10.4    Funded Debt to EBITDA. To maintain on a
consolidated basis ratio of Funded Debt to EBIDTA not exceeding 1.75. 
  
 ‘Funded Debt’ means all
outstanding liabilities for borrowed money and other interest-bearing liabilities plus the current portion of long term liabilities. 
  
 ‘EBITDA’ means net income, less income or plus loss from discontinued operations and extraordinary items, plus income taxes, plus interest expense, plus depreciation, depletion, amortization and other
non-cash charges. 
  
 This ratio will be calculated at the end of each fiscal quarter, using the results of that
quarter and each of the 3 immediately preceding quarters. The current portion of long-term liabilities will be measured as of the last day of the preceding fiscal year. 
  
 10.5    Debt Service Coverage Ratio. To maintain on a consolidated basis a Debt Service Coverage Ratio of at least 1.5:1.0. 

 
 ‘Debt Service Coverage Ratio’ is defined as the sum of earnings before interest, taxes, depreciation and
amortization minus taxes minus dividends plus any non-cash charges divided by the sum of interest plus the current portion of long term liabilities plus 20% of the outstanding principal under its revolving line of credit. This ratio will be
calculated at the end of each fiscal quarter, using the results of that quarter and each of the 3 immediately preceding quarters. The current portion of long-term liabilities will be measured as of the last day of the preceding fiscal year.

  
 10.6    EBITDA.    To maintain on a consolidated basis an
EBITDA equal to at least the amounts specified below for the periods specified below: 
 

 4 

  
 
	 Period
 	  	 Amount
 
	 From the date hereof 
 	  	  
	 through December 30, 2002
 	  	 $6,000,000
 
	 From December 31, 2002
 	  	  
	 and thereafter
 	  	 $8,500,000.
 

 
  
  
 This ratio will be
calculated at the end of each fiscal quarter, using the results of that quarter and each of the 3 immediately preceding quarters based on the Borrower’s Form 10Q Quarterly Reports.” 
  

2.15    Paragraph 10.7 of the Agreement is deleted in its entirety. 
 2.16 In Subparagraph 10.20(f) of the Agreement, the amounts “Three Million Five Hundred Thousand Dollars ($3,5000,000)” and “Five Million Dollars ($5,000,000)” are substituted for the amounts
“Two Million Five Hundred Thousand Dollars ($2,500,000)” and “Four Million Dollars ($4,000,000),” respectively. 
  
 3.    Representations and Warranties.  When the Borrower signs this Amendment, the Borrower represents and warrants to the Bank that: (a) there is no event which is, or with notice or lapse of time or
both would be, a default under the Agreement except those events, if any, that have been disclosed in writing to the Bank or waived in writing by the Bank, (b) the representations and warranties in the Agreement are true as of the date of this
Amendment as if made on the date of this Amendment, (c) this Amendment does not conflict with any law, agreement, or obligation by which the Borrower is bound, and (d) this Amendment is within the Borrower’s powers, has been duly authorized,
and does not conflict with any of the Borrower’s organizational papers. 
  
 4.    Conditions.    This Amendment will be effective when the Bank receives the following items, in form and content acceptable to the Bank: 
  
 4.1  This Amendment signed by the Borrower and the Bank. 
  
 4.2  Evidence that the execution by the Borrower and each guarantor of the Agreement and any instrument or agreement required under the Agreement have been
duly authorized. 
  
 4.3  Guaranties signed by each guarantor as named in Paragraph 8.4 of the
Agreement, as amended herein. 
  
 4.4  Signed security agreements and financing statements by
Terra-Mar, Inc., Robert W. Hunt Company, and Testing Engineers Nevada, Inc. 
  
 5.    Effect of
Amendment.    Except as provided in this Amendment, all of the terms and conditions of the Agreement shall remain in full force and effect. 
 

 5 

  
 6.    Counterparts.    This Amendment may be
executed in counterparts, each of which when so executed shall be deemed an original, but all such counterparts together shall constitute but one and the same instrument. 
  
 7.    FINAL AGREEMENT.    THIS WRITTEN AMENDMENT REPRESENTS THE FINAL AGREEMENT BETWEEN AND AMONG THE PARTIES HERETO AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS BETWEEN OR AMONG THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN OR AMONG THE PARTIES. 
  
 This Amendment is executed as of the date stated at the beginning of this Amendment. 
  
 
	 Bank of America, N.A. 
 
	 
	 By: /s/    GORDON W.
WIENS        
 

	  	 	 Gordon W. Wiens
 
	  	 	 Vice President
 

 
  
 
	 U.S. Laboratories, Inc. 
 
	 
	 By: /s/    DICKERSON
WRIGHT        
 

	  	 	 Dickerson Wright
 
	  	 	 Chairman/Chief Executive Officer
 

 
  
 

 6<PAGE>
                                                                    Exhibit 10.1

                                 $1,115,000,000

                                CREDIT AGREEMENT

                           Dated as of April 26, 2002

                                      Among

                                   DAVITA INC.

                                   as Borrower
                                   -----------

                CREDIT SUISSE FIRST BOSTON, CAYMAN ISLANDS BRANCH

                             as Administrative Agent
                             -----------------------

                CREDIT SUISSE FIRST BOSTON, CAYMAN ISLANDS BRANCH

                                       and

                         BANC OF AMERICA SECURITIES LLC,

                 as Joint Lead Arrangers and Joint Book Managers
                 -----------------------------------------------

                             BANK OF AMERICA, N.A.,

                              as Syndication Agent
                              --------------------

          THE BANK OF NEW YORK, THE BANK OF NOVA SCOTIA, WACHOVIA BANK,
                              NATIONAL ASSOCIATION

                             as Documentation Agents
                             -----------------------

                                       and

                  THE INITIAL LENDERS, INITIAL ISSUING BANK AND
                          SWING LINE BANK party hereto

<PAGE>

                                TABLE OF CONTENTS
<TABLE>

Section                                                                                                 Page
-------                                                                                                 ----
<S>                                                                                                 <C>
                               ARTICLE I DEFINITIONS AND ACCOUNTING TERMS

SECTION 1.01. Certain Defined Terms .................................................................     1
SECTION 1.02. Computation of Time Periods; Other Definitional Provisions ............................    28
SECTION 1.03. Accounting Terms ......................................................................    29

                ARTICLE II AMOUNTS AND TERMS OF THE ADVANCES AND THE LETTERS OF CREDIT

SECTION 2.01. The Advances and the Letters of Credit. ...............................................    29
SECTION 2.02. Making the Advances. ..................................................................    31
SECTION 2.03. Issuance of and Drawings and Reimbursement Under Letters of Credit. ...................    34
SECTION 2.04. Repayment of Advances. ................................................................    36
SECTION 2.05. Termination or Reduction of the Commitments. ..........................................    38
SECTION 2.06. Prepayments. ..........................................................................    39
SECTION 2.07. Interest ..............................................................................    41
SECTION 2.08. Fees. .................................................................................    42
SECTION 2.09. Conversion of Advances. ...............................................................    44
SECTION 2.10. Increased Costs, Etc. .................................................................    45
SECTION 2.11. Evidence of Debt. .....................................................................    47
SECTION 2.12. Payments and Computations. ............................................................    47
SECTION 2.13. Taxes. ................................................................................    50
SECTION 2.14. Sharing of Payments, Etc ..............................................................    53
SECTION 2.15. Use of Proceeds .......................................................................    53
SECTION 2.16. Defaulting Lenders. ...................................................................    54

                 ARTICLE III CONDITIONS OF LENDING AND ISSUANCES OF LETTERS OF CREDIT

SECTION 3.01. Conditions Precedent to Initial Extension of Credit ...................................    56
SECTION 3.02. Conditions Precedent to Each Borrowing and Issuance and Renewal .......................    59
SECTION 3.03. Determinations Under Section 3.01 .....................................................    60

ARTICLE IV REPRESENTATIONS AND WARRANTIES

SECTION 4.01. Representations and Warranties of the Borrower ........................................    60

                                 ARTICLE V COVENANTS OF THE BORROWER

SECTION 5.01. Affirmative Covenants .................................................................    65
SECTION 5.02. Negative Covenants ....................................................................    69
SECTION 5.03. Reporting Requirements ................................................................    79
SECTION 5.04. Financial Covenants ...................................................................    82
</TABLE>

<PAGE>

                                       ii

                          ARTICLE VI EVENTS OF DEFAULT
<TABLE>
Section                                                                                                 Page
-------                                                                                                 ----
<S>                                                                                                 <C>

SECTION 6.01. Events of Default .....................................................................    85
SECTION 6.02. Actions in Respect of the Letters of Credit upon Default ..............................    88

                             ARTICLE VII THE AGENTS

SECTION 7.01. Appointment, Powers and Immunity. .....................................................    89
SECTION 7.02. Reliance by Agent .....................................................................    90
SECTION 7.03. Defaults ..............................................................................    90
SECTION 7.04. CSFB and Affiliates ...................................................................    90
SECTION 7.05. Indemnification. ......................................................................    91
SECTION 7.06. Non-Reliance on Agent and Other Lender Parties ........................................    92
SECTION 7.07. Resignation of Administrative Agent ...................................................    92
SECTION 7.08. Release of Collateral .................................................................    93
SECTION 7.09. Release of Guarantor ..................................................................    93
SECTION 7.10. Actions in Respect of Intercreditor Agreement .........................................    93

                           ARTICLE VIII MISCELLANEOUS

SECTION 8.01. Amendments, Etc .......................................................................    93
SECTION 8.02. Notices, Etc. .........................................................................    95
SECTION 8.03. No Waiver; Remedies ...................................................................    95
SECTION 8.04. Costs and Expenses. ...................................................................    95
SECTION 8.05. Right of Set-off ......................................................................    97
SECTION 8.06. Successors and Assigns ................................................................    97
SECTION 8.07. Assignments and Participations. .......................................................    98
SECTION 8.08. Execution in Counterparts .............................................................   102
SECTION 8.09. No Liability of the Issuing Bank ......................................................   102
SECTION 8.10. Confidentiality .......................................................................   102
SECTION 8.11. Execution in Counterparts .............................................................   103
SECTION 8.12. Governing Law, Jurisdiction, Etc. .....................................................   103
SECTION 8.13. Designation as Designated Senior Debt .................................................   103
SECTION 8.14. WAIVER OF JURY TRIAL ..................................................................   104
</TABLE>

SCHEDULES
---------

Schedule I           -     Commitments and Applicable Lending Offices

Schedule II          -     Existing Letters of Credit

Schedule 4.01(b)     -     Subsidiaries

Schedule 4.01(d)     -     Authorizations

Schedule 4.01(f)     -     Litigation

Schedule 4.01(o)     -     Environmental Laws

Schedule 4.01(p)     -     Open Years

Schedule 4.01(q)     -     Liens

Schedule 4.01(r)     -     Investments

<PAGE>

                                      iii

Schedule 4.01(s)     -     Facilities

Schedule 5.02(b)     -     Debt

EXHIBITS
--------

Exhibit A-1          -     Form of Term A Note

Exhibit A-2          -     Form of Term B Note

Exhibit A-3          -     Form of Revolving Credit Note

Exhibit B-1          -     Form of Notice of Borrowing

Exhibit B-2          -     Form of Notice of Swing Line Borrowing

Exhibit B-3          -     Form of Notice of Conversion

Exhibit C            -     Form of Assignment and Assumption

Exhibit D            -     Form of Security Agreement

Exhibit E            -     Form of Subsidiary Guarantee

Exhibit F            -     Form of Opinion of Borrower's General Counsel

Exhibit G            -     Form of Opinion of Riordan & McKinzie

Exhibit H            -     Entities that are not Subsidiaries

Exhibit I            -     Form of Notice of Covenant Reduction

<PAGE>

                                CREDIT AGREEMENT

     CREDIT AGREEMENT dated as of April 26, 2002 among DAVITA INC., a Delaware
corporation (the "Borrower"), the banks, financial institutions and other
institutional lenders listed on the signature pages hereof under the caption
"Initial Lenders" (the "Initial Lenders"), the banks party hereto as Issuing
Banks (as hereinafter defined), CREDIT SUISSE FIRST BOSTON, CAYMAN ISLANDS
BRANCH ("CSFB"), as the provider of the Swing Line Facility (as hereinafter
defined) (the "Swing Line Bank"), CSFB and BANC OF AMERICA SECURITIES LLC, as
the joint book running managers and joint lead arrangers (the "Book Managers")
for the Facilities (as hereinafter defined), CSFB as the administrative agent
(together with any successor thereto appointed pursuant to Article VII, the
"Administrative Agent") for the Lender Parties (as hereinafter defined), THE
BANK OF NEW YORK, THE BANK OF NOVA SCOTIA and WACHOVIA BANK, NATIONAL
ASSOCIATION, as documentation agents (the "Documentation Agents") and BANK OF
AMERICA, N.A. ("BofA"), as syndication agent (the "Syndication Agent").

                             PRELIMINARY STATEMENTS:

     The Borrower has requested that the Lender Parties provide credit
facilities in an aggregate amount of $1,115,000,000 as provided herein, and the
Lender Parties have agreed to provide such credit facilities on the terms and
conditions of this Agreement.

     NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereto hereby agree as
follows:

                                   ARTICLE I

                        DEFINITIONS AND ACCOUNTING TERMS

     SECTION 1.01. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and the plural forms of the terms defined):

          "Accepting Lender" has the meaning specified in Section 2.06(d).

          "Administrative Agent" has the meaning specified in the recital of
     parties to this Agreement.

          "Administrative Agent's Account" means the account of the
     Administrative Agent maintained by the Administrative Agent at The Bank of
     New York, ABA No. 021000018, Account Name: "CSFB Agency Cayman Account,"
     Account No. 8900492627, Reference: DaVita Inc., or such other account
     maintained by the Administrative Agent and designated by the Administrative
     Agent from time to time as such in a written notice to the Borrower and
     each of the Lender Parties.

          "Administrative Questionnaire" means a questionnaire, in form and
     substance satisfactory to the Administrative Agent, delivered by an
     Eligible Assignee pursuant to Section 8.07(a)(iv) which provides the
     administrative information relating to such Eligible Assignee.

          "Advance" means a Term A Advance, a Term B Advance, a Revolving Credit
     Advance, a Swing Line Advance or a Letter of Credit Advance, as the context
     may require.

<PAGE>

          "Affiliate" means, with respect to any Person, any other Person that,
     directly or indirectly, controls, is controlled by or is under common
     control with such Person or is a director or officer of such Person. For
     purposes of this definition, the term "control" (including the terms
     "controlling," "controlled by" and "under common control with") of a Person
     means the possession, direct or indirect, of the power to vote 10% or more
     of the Voting Interests in such Person or to direct or cause the direction
     of the management and policies of such Person, whether through the
     ownership of Voting Interests, by contract or otherwise.

          "Agents" means, collectively, the Administrative Agent, the Book
     Managers, the Syndication Agent, the Documentation Agents and each co-agent
     or sub-agent appointed by the Administrative Agent from time to time
     pursuant to Section 7.01(b).

          "Agreement" means this Credit Agreement, as the same may be amended,
     restated, supplemented or otherwise modified from time to time.

          "Agreement Value" means, for each Hedge Agreement, on any date of
     determination, an amount reasonably determined by the Administrative Agent
     equal to: (a) in the case of a Hedge Agreement documented pursuant to the
     Master Agreement (Multicurrency-Cross Border) published by the
     International Swap and Derivatives Association, Inc. (the "Master
     Agreement"), the amount, if any, that would be payable by any Loan Party to
     its counterparty in respect of such Hedge Agreement, as if (i) such Hedge
     Agreement was being terminated early on such date of determination, (ii)
     such Loan Party was the sole "Affected Party", and (iii) the Administrative
     Agent was the sole party determining such payment amount (with the
     Administrative Agent making such determination pursuant to the provisions
     of that specific form of Master Agreement); or (b) in the case of a Hedge
     Agreement traded on an exchange, the mark-to-market value of such Hedge
     Agreement, which will be the unrealized gain or loss on such Hedge
     Agreement to the Loan Party to such Hedge Agreement reasonably determined
     by the Administrative Agent based on the settlement price of such Hedge
     Agreement on such date of determination, or (c) in all other cases, the
     mark-to-market value of such Hedge Agreement, which will be the unrealized
     gain or loss on such Hedge Agreement to the Loan Party to such Hedge
     Agreement reasonably determined by the Administrative Agent as the amount,
     if any, by which (i) the present value of the future cash flows to be paid
     by such Loan Party exceeds (ii) the present value of the future cash flows
     to be received by such Loan Party pursuant to such Hedge Agreement;
     capitalized terms used and not otherwise defined in this definition shall
     have the respective meanings set forth in the above described Master
     Agreement.

          "Applicable Lending Office" means (a) with respect to each of the
     Lenders, the Base Rate Lending Office of such Lender in the case of a Base
     Rate Advance and the Eurodollar Lending Office of such Lender in the case
     of a Eurodollar Rate Advance and (b) with respect to the Issuing Bank and
     the Swing Line Bank, the Base Rate Lending Office of the Issuing Bank and
     the Swing Line Bank, respectively, for all purposes of this Agreement.

          "Applicable Margin" means (i) at any time during the period from the
     date of this Agreement through the date of receipt by the Administrative
     Agent of the Required Financial Information for the Measurement Period
     ending March 31, 2002, 1.75% per annum for Base Rate Advances under the
     Term A Facility and the Revolving Credit Facility and 2.00% per annum for
     Base Rate Advances under the Term B Facility and 2.75% per annum for
     Eurodollar Rate Advances under the Term A Facility and the Revolving Credit
     Facility and 3.00% per annum for Eurodollar Rate Advances under the Term B
     Facility and (ii) at any time and from time to time thereafter, on any date
     of determination, a percentage per annum equal to the applicable

                                       2

<PAGE>

     percentage for the Performance Level set forth below as determined by
     reference to the Leverage Ratio for the most recently completed Measurement
     Period:
<TABLE>

==============================================================================================================
                                                Base Rate Advances                  Eurodollar Rate Advances
---------------------------------    ---------------------------------------     -----------------------------
Performance Level  Leverage Ratio    Term A Facility/Revolving       Term B            Term A         Term B
                                          Credit Facility           Facility     Facility/Revolving   Facility
                                                                                  Credit Facility
<S>             <C>                <C>                           <C>          <C>                  <C>
--------------------------------------------------------------------------------------------------------------

I                 Less than 2.00x    0.50%                           2.00%        1.50%                3.00%
--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
II                Greater than or    1.00%                           2.00%        2.00%                3.00%
                  equal to 2.00x
                  but less than
                  2.50x

--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
III               Greater than or    1.25%                           2.00%        2.25%                3.00%
                  equal to 2.50x
                  but less than
                  3.00x

--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
IV                Greater than or    1.50%                           2.00%        2.50%                3.00%
                  equal to 3.00x
                  but less than
                  3.50x

--------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------
V                 Greater than or    1.75%                           2.00%        2.75%                 3.00%
                  equal to 3.50x
==============================================================================================================
</TABLE>

                  For the purposes of:

                         (A) clause (ii) of the immediately preceding sentence,
                    the Applicable Margin for each Base Rate Advance shall be
                    determined by reference to the Performance Level in effect
                    from time to time and the Applicable Margin for each
                    Eurodollar Rate Advance shall be determined by reference to
                    the Performance Level in effect on the first day of each
                    Interest Period for such Eurodollar Rate Advance; and

                         (B) determining the Performance Level in respect of the
                    Applicable Margin at any date of determination, changes in
                    the Performance Level shall be effective on the date on
                    which the Administrative Agent and the Lender Parties
                    receive the Required Financial Information reflecting such
                    change; provided, however, that if the Borrower has not
                    delivered to the Administrative Agent and the Lender Parties
                    all of the information required under this clause (B) within
                    five Business Days after the date on which such information
                    is otherwise required under Section 5.03(b) or 5.03(c), as
                    applicable, the Performance Level shall be deemed to be at
                    Performance Level IV for so long as such information has not
                    been submitted.

                    "Applicable Percentage" means, with respect to the
               Commitment Fee, (a) at any time during the period from the date
               of this Agreement through the date of receipt by the

                                       3

<PAGE>

               Administrative Agent of the Required Financial Information for
               the Measurement Period ending March 31, 2002, 0.50% per annum and
               (b) at any time and from time to time thereafter, a rate per
               annum equal to 0.375% if the Leverage Ratio for the most recently
               completed Measurement Period is less than 3.00:1.00 and 0.50% if
               such Leverage Ratio is greater than or equal to 3.00:1.00. For
               the purposes of determining the Leverage Ratio in respect of the
               Applicable Percentage at any date of determination, changes in
               the Applicable Percentage shall be effective on the date on which
               the Administrative Agent and the Lender Parties receive the
               Required Financial Information reflecting such change; provided,
               however, that if the Borrower has not delivered to the
               Administrative Agent and the Lender Parties all of the
               information required under this definition within five Business
               Days after the date on which such information is otherwise
               required under Section 5.03(b) or 5.03(c), as applicable, the
               Applicable Percentage shall be 0.50% for so long as such
               information has not been submitted.

                    "Appropriate Lender" means, at any time, (a) with respect to
               the Term A Facility, the Term B Facility or the Revolving Credit
               Facility, a Lender that has a Commitment with respect to such
               Facility at such time, (b) with respect to the Letter of Credit
               Facility, (i) the Issuing Bank and (ii) if the Revolving Credit
               Lenders have made Letter of Credit Advances pursuant to Section
               2.03(b) that are outstanding at such time, each such Revolving
               Credit Lender and (c) with respect to the Swing Line Facility,
               (i) the Swing Line Bank and (ii) if the Revolving Credit Lenders
               have made Swing Line Advances pursuant to Section 2.02(b) that
               are outstanding at such time, each such Revolving Credit Lender.

                    "Approved Fund" means any Person (other than a natural
               Person) that (i) is (or will be) an "accredited investor" (as
               defined in Regulation D under the Securities Act) engaged in
               making, purchasing, holding or otherwise investing in commercial
               loans and similar extensions of credit in the ordinary course of
               its business and (ii) is administered, advised or managed by (a)
               a Lender, (b) an Affiliate of a Lender or (c) an entity or an
               Affiliate of an entity that administers, advises or manages a
               Lender.

                    "Assignment and Assumption" means an Assignment and
               Assumption entered into by a Lender Party and an Eligible
               Assignee, and accepted by the Administrative Agent and, if
               applicable, the Borrower, in accordance with Section 8.07 and in
               substantially the form of Exhibit C hereto.

                    "Available Amount" of any Letter of Credit means, at any
               time, the maximum amount available to be drawn under such Letter
               of Credit at such time (assuming compliance at such time with all
               conditions to drawing).

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

                         (a) the rate of interest established by CSFB from time
                    to time as its prime rate (which rate of interest may not be
                    the lowest rate of interest charged by CSFB to its
                    customers); and

                         (b) the Federal Funds Rate plus 0.50%.

                    Any change in the Base Rate resulting from a change in the
               prime rate established by CSFB shall become effective on the
               Business Day on which such change in the prime rate is announced
               by CSFB.

                                       4

<PAGE>

                    "Base Rate Advance" means an Advance that bears interest as
               provided in Section 2.07(a)(i).

                    "Base Rate Lending Office" means, with respect to each of
               the Lender Parties, the office of such Lender Party specified as
               its "Base Rate Lending Office" opposite its name on Schedule I
               hereto or in the Assignment and Assumption pursuant to which it
               became a Lender Party, as the case may be, or such other office
               of such Lender Party as such Lender Party may from time to time
               specify to the Borrower and the Administrative Agent for such
               purpose.

                    "Borrower's Account" means such account of the Borrower as
               is agreed from time to time in writing between the Borrower and
               the Administrative Agent.

                    "Borrower's Percentage" means, in respect of the sale or
               issuance of Equity Interests by any Subsidiary of the Borrower,
               the percentage of the common Equity Interests of such Subsidiary
               beneficially owned directly or indirectly by the Borrower after
               giving effect to such sale or issuance.

                    "Borrowing" means a Term A Borrowing, a Term B Borrowing, a
               Revolving Credit Borrowing or a Swing Line Borrowing, as the
               context may require.

                    "Business Day" means a day of the year on which banks are
               not required or authorized by law to close in New York, New York,
               and, if the applicable Business Day relates to any Eurodollar
               Rate Advances, on which dealings are carried on in U.S. dollar
               deposits in the London interbank market.

                    "Capital Assets" means, with respect to any Person, all
               equipment, fixed assets and real property or improvements of such
               Person, or replacements or substitutions therefor or additions
               thereto, that, in accordance with GAAP, have been or should be
               reflected as additions to property, plant or equipment on the
               balance sheet of such Person.

                    "Capital Expenditures" means, with respect to any Person for
               any period, all expenditures made directly or indirectly by such
               Person during such period for Capital Assets (whether paid in
               cash or other consideration or accrued as a liability and
               including, without limitation, all expenditures for maintenance
               and repairs which are required, in accordance with GAAP, to be
               capitalized on the books of such Person). For purposes of this
               definition, the purchase price of equipment or other fixed assets
               that are purchased simultaneously with the trade-in of existing
               assets or with insurance proceeds shall be included in Capital
               Expenditures only to the extent of the gross amount by which such
               purchase price exceeds the credit granted by the seller of such
               assets for the assets being traded in at such time or the amount
               of such insurance proceeds, as the case may be.

                    "Capitalized Lease" means any lease with respect to which
               the lessee is required to recognize concurrently the acquisition
               of property or an asset and the incurrence of a liability in
               accordance with GAAP.

                    "Capitalized Lease Obligations" means, with respect to any
               Capitalized Lease, the amount required to be capitalized in the
               financial statements of the lessee in accordance with GAAP.

                    "Cash Distributions" means, with respect to any Person for
               any period, all dividends and other distributions on any of the
               outstanding Equity Interests in such Person, all purchases,

                                       5

<PAGE>

               redemptions, retirements, defeasances or other acquisitions of
               any of the outstanding Equity Interests in such Person and all
               returns of capital to the stockholders, partners or members (or
               the equivalent persons) of such Person, in each case to the
               extent paid in cash by or on behalf of such Person during such
               period.

                    "Cash Equivalents" means (a) securities with maturities of
               one year or less from the date of acquisition, issued, fully
               guaranteed or insured by the United States Government, (b)
               securities with maturities of one year or less from the date of
               acquisition issued, fully guaranteed or insured by any State of
               the United States of America or any political subdivision thereof
               rated at least AA- by S&P's Ratings Services or Aa3 by Moody's,
               or carrying an equivalent rating by a nationally recognized
               rating agency if both of the two named rating agencies cease
               publishing ratings of investments, (c) certificates of deposit,
               time deposits, overnight bank deposits, bankers' acceptances and
               repurchase agreements issued by a Qualified Issuer having
               maturities of 270 days or less from the date of acquisition,
               (d) commercial paper of an issuer rated at least A-2 by S&P's
               Ratings Services or P-2 by Moody's, or carrying an equivalent
               rating by a nationally recognized rating agency if both of the
               two named rating agencies cease publishing ratings of
               investments, and having maturities of 270 days or less from the
               date of acquisition, (e) money market accounts or funds, a
               substantial portion of the assets of which constitute Cash
               Equivalents described in clauses (a) through (d) above, with,
               issued by or managed by Qualified Issuers, and (f) money market
               accounts or funds, a substantial portion of the assets of which
               constitute Cash Equivalents described in clauses (a) through (d)
               above, which money market accounts or funds have net assets of
               not less than $500,000,000 and have the highest rating available
               of either S&P's Ratings Services or Moody's, or carrying an
               equivalent rating by a nationally recognized rating agency if
               both of the two named rating agencies cease publishing ratings of
               investments.

                    "CERCLA" means the Comprehensive Environmental Response,
               Compensation and Liability Act of 1980, as amended from time to
               time.

                    "CERCLIIS" means the Comprehensive Environmental Response,
               Compensation and Liability Information System maintained by the
               U.S. Environmental Protection Agency.

                    "CHAMPUS" means the United States Department of Defense
               Human Civilian Health and Medical Program of the Uniformed
               Services.

                    "Change of Control" means, at any time:

                    (a) any "person" or "group" (each as used in Sections
               13(d)(3) and 14(d)(2) of the Exchange Act) (i) becomes the
               "beneficial owner" (as defined in Rule 13d-3 of the Exchange
               Act), directly or indirectly, of Voting Interests in the Borrower
               (including through securities convertible into or exchangeable
               for such Voting Interests) representing 35% or more of the
               combined voting power of all of the Voting Interests in the
               Borrower (on a fully diluted basis) or (ii) otherwise has the
               ability, directly or indirectly, to elect a majority of the board
               of directors of the Borrower; or

                    (b) during any period of 24 consecutive months, whether
               commencing before or after the date of this Agreement,
               individuals who at the beginning of such 24-month period were
               Continuing Directors shall cease for any reason to constitute a
               majority of the board of directors of the Borrower;

                                       6

<PAGE>

                    "Closing Date" means the first date on which all of the
               conditions precedent to the Initial Extension of Credit set forth
               in Article III are satisfied, which date shall occur on or prior
               to May 15, 2002.

                    "Collateral" means all of the "Collateral" referred to in
               the Collateral Documents and all of the other property and assets
               that are or are intended under the terms of the Collateral
               Documents to be subject to Liens in favor of the Administrative
               Agent for the benefit of the Secured Parties.

                    "Collateral Documents" means, collectively, the Security
               Agreement, collateral assignments, Security Agreement
               Supplements, security agreements, pledge agreements, mortgages,
               deeds of trust or other similar agreements delivered to the
               Administrative Agent and the Lender Parties pursuant to Section
               3.01(a) or Section 5.01(j), 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.

                    "Commitment" means a Term Commitment, a Revolving Credit
               Commitment or a Swing Line Commitment, as the context may
               require.

                    "Commitment Fee" has the meaning specified in Section
               2.08(a)(i).

                    "Confidential Information" means information that is
               furnished to the Administrative Agent or any of the Lender
               Parties by or on behalf of the Borrower or any of its
               Subsidiaries in a writing that is marked as confidential or
               otherwise on an expressly confidential basis, but does not
               include any such information that (a) is or becomes generally
               available to the public (other than as a result of a breach by
               the Administrative Agent or such Lender Party of its
               confidentiality obligations under this Agreement) or (b) is or
               becomes available to the Administrative Agent or such Lender
               Party from a source other than the Borrower or any of its
               Subsidiaries that is not, to the knowledge of the Administrative
               Agent or such Lender Party, acting in violation of a
               confidentiality agreement with the Borrower or any such
               Subsidiary.

                    "Consolidated" refers to the consolidation of accounts in
               accordance with GAAP.

                    "Consolidated Cash Taxes" means, with respect to any Person
               for any period, (a) the aggregate amount of all payments in
               respect of income taxes made in cash by such Person and its
               Subsidiaries to any applicable Governmental Authority during such
               period less (b) the aggregate amount of all cash refunds in
               respect of income taxes received by such Person and its
               Subsidiaries from any applicable Governmental Authority during
               such period, after giving effect, to the extent available, to the
               application of net operating losses available to such Person or
               any such Subsidiary.

                    "Consolidated EBITDA" means, with respect to any Person for
               any period, the amount equal to (I) the sum of (a) the
               Consolidated Net Income of such Person and its Subsidiaries for
               such period plus (b) the sum of each of the following expenses
               that have been deducted in the determination of the Consolidated
               Net Income of such Person and its Subsidiaries for such period:
               (i) the Consolidated Interest Expense of such Person and its
               Subsidiaries for such period, (ii) all income tax expense
               (whether federal, state, local, foreign or otherwise) of such
               Person and its Subsidiaries for such period, (iii) all
               depreciation expense of such Person and its Subsidiaries for such
               period, (iv) all amortization expense of such Person and its
               Subsidiaries for such period and (v) all non-cash charges
               otherwise deducted in determining the Consolidated Net Income of
               such Person and its Subsidiaries for such period less all
               extraordinary gains added in determining

                                       7

<PAGE>

               the Consolidated Net Income of such Person and its Subsidiaries
               for such period; provided that for any period, the amount of
               non-cash charges arising from the write-off of current assets
               shall not be included in this subclause (v) plus (c) for each
               such period ending during the twelve-month period immediately
               following the closing of any acquisition permitted under Section
               5.02(f), an amount equal to the Consolidated EBITDA (calculated
               on the basis as provided herein) for each such acquisition
               calculated on a pro forma basis as if such acquisition had
               occurred on the first day of the twelve-month period then ended,
               minus (d) any cash expenditures for such period relating to the
               non-cash charges set forth in subclause (b)(v) hereof, whether
               for such period or any prior period, plus (e) non-recurring
               charges incurred during such period not exceeding in the
               aggregate during the period from April 1, 2000 and continuing
               through the term of this Agreement $45,000,000 resulting from the
               write-off of accounts receivable and other related charges as a
               result of the pending third party carrier review of claims for
               Medicare reimbursement submitted by the Subsidiary of the
               Borrower operating the Borrower's Florida laboratory or other
               Governmental Reimbursement Program Costs, minus (II) in respect
               of (a) any Subsidiary sold in such period or (b) any assets sold
               or disposed of in such period as to which EBITDA attributable
               thereto can be determined, an amount equal to the Consolidated
               EBITDA (calculated on the basis as provided herein) for each such
               sale or disposition otherwise included in Consolidated EBITDA for
               such period.

                    "Consolidated Interest Expense" means, with respect to any
               Person for any period, the gross interest expense accrued on all
               Debt of such Person and its Subsidiaries during such period,
               determined on a Consolidated basis and in accordance with GAAP
               for such period, including, without limitation, (a) in the case
               of the Borrower, all fees paid or payable pursuant to Section
               2.08(a), (b) commissions, discounts and other fees and charges
               paid or payable in connection with letters of credit (including,
               without limitation, the Letters of Credit), (c) all amortization
               of original issue discount in respect of all Debt of such Person
               and its Subsidiaries, (d) all dividends on Redeemable Preferred
               Interests, to the extent paid or payable in cash, and (e) the net
               payment, if any, paid or payable in connection with Hedge
               Agreements less the net credit, if any, received in connection
               with Hedge Agreements.

                    "Consolidated Net Income" means, for any period, the net
               income (or net loss) of any Person and its Subsidiaries for such
               period, determined on a Consolidated basis and in accordance with
               GAAP.

                    "Consolidated Pre-Minority EBITDA" means Consolidated EBITDA
               plus minority interests in income of consolidated Subsidiaries of
               the Borrower to the extent deducted in determining net income of
               the Borrower and its Subsidiaries on a Consolidated basis in the
               calculation of Consolidated EBITDA.

                    "Constitutive Documents" means, with respect to any Person,
               the certificate of incorporation or registration (including, if
               applicable, certificate of change of name), articles of
               incorporation or association, memorandum of association, charter,
               bylaws, certificate of limited partnership, partnership
               agreement, trust agreement, joint venture agreement, certificate
               of formation, articles of organization, limited liability company
               operating or members agreement, joint venture agreement or one or
               more similar agreements, instruments or documents constituting
               the organization or formation of such Person.

                    "Contingent Obligation" means, with respect to any Person,
               any Obligation or arrangement of such Person to guarantee or
               intended to guarantee any Debt, leases, dividends or other
               obligations ("primary obligations") of any other Person (the
               "primary obligor") in any manner, whether directly or indirectly,
               including, without limitation, (a) the direct or indirect

                                       8

<PAGE>
               guarantee, endorsement (other than for collection or deposit in
               the ordinary course of business), co-making, discounting with
               recourse or sale with recourse by such Person of the Obligation
               of a primary obligor, (b) the Obligation to make take-or-pay or
               similar payments, if required, regardless of nonperformance by
               any other party or parties to an agreement or (c) any Obligation
               of such Person, whether or not contingent, (i) to purchase any
               such primary obligation or any property constituting direct or
               indirect security therefor, (ii) to advance or supply funds

               (A) for the purchase or payment of any such primary obligation or
               (B) to maintain working capital, equity capital, net worth or
               other balance sheet condition or any income statement condition
               of the primary obligor or otherwise to maintain the solvency of
               the primary obligor, (iii) to purchase, lease or otherwise
               acquire property, assets, securities or services primarily for
               the purpose of assuring the owner of any such primary obligation
               of the ability of the primary obligor to make payment of such
               primary obligation or (iv) otherwise to assure or hold harmless
               the holder of such primary obligation against loss in respect
               thereof. The amount of any Contingent Obligation shall be deemed
               to be an amount equal to the stated or determinable amount of the
               primary obligation in respect of which such Contingent Obligation
               is made (or, if less, the maximum amount of such primary
               obligation for which such Person may be liable pursuant to the
               terms of the agreement, instrument or other document evidencing
               such Contingent Obligation) or, if not stated or determinable,
               the maximum reasonably anticipated liability in respect thereof
               (assuming such Person is required to perform thereunder), as
               determined by such Person in good faith.

                    "Continuing Director" means, for any period, an individual
               who is a member of the board of directors of the Borrower on the
               first day of such period or who has been nominated to the board
               of directors of the Borrower by a majority of the other
               Continuing Directors who were members of the board of directors
               of the Borrower at the time of such nomination.

                    "Conversion", "Convert" and "Converted" each refer to a
               conversion of Advances of one Type into Advances of the other
               Type pursuant to Section 2.09 or 2.10.

                    "Debt" means, with respect to any Person (without
               duplication) (a) all indebtedness of such Person for borrowed
               money, (b) all Obligations of such Person for the deferred
               purchase price of property or services (other than unsecured
               trade payables incurred in the ordinary course of such Person's
               business, provided that at all times during which the aggregate
               amount of such payables exceed 50% of Consolidated EBITDA for the
               most recent Measurement Period, "Debt" shall include all such
               payables which are past due for more than 60 days (excluding
               payables being contested in good faith) after the date on which
               such payable was first past due), (c) all Obligations of such
               Person evidenced by notes, bonds, debentures or other similar
               instruments, or upon which interest payments are customarily
               made, (d) all Obligations of such Person created or arising under
               any conditional sale or other title retention agreement with
               respect to property acquired by such Person (even though the
               rights and remedies of the seller or lender under such agreement
               in the event of default are limited to repossession or sale of
               such property), (e) all Capitalized Lease Obligations of such
               Person, (f) all Obligations, contingent or otherwise, of such
               Person under acceptance, letter of credit or similar facilities,
               (g) all Obligations of such Person to purchase, redeem, retire,
               defease or otherwise make any payment in respect of any preferred
               Equity Interests in such Person or any other Person, valued, at
               the greater of its voluntary or involuntary liquidation
               preference plus accrued and unpaid dividends, (h) all Obligations
               of such Person in respect of Hedge Agreements, take-or-pay
               agreements or other similar arrangements, valued, in the case of
               Hedge Agreements, at the Agreement Value thereof, (i) all
               Obligations of such Person under any synthetic lease, tax
               retention operating lease, off-balance sheet loan or similar
               off-balance sheet financing if the transaction giving rise to
               such Obligation is considered indebtedness for borrowed money for
               tax purposes but is classified as an operating lease in
               accordance with GAAP; (j) all Contingent Obligations, and (k) all
               indebtedness and other

                                       9

<PAGE>

               payment Obligations referred to in clauses (a) through (j) above
               of another Person secured by (or for which the holder of such
               indebtedness or other payment Obligations has an existing right,
               contingent or otherwise, to be secured by) any Lien on property
               (including, without limitation, accounts and contract rights)
               owned by such Person, even though such Person has not assumed or
               become liable for the payment of such indebtedness or other
               payment Obligations: provided that for the purposes of this
               subclause (k) the amount thereof shall be equal to the lesser of
               (i) the amount of such indebtedness or other payment Obligations
               and (ii) the fair market value of the property subject to such
               Lien.

                    "Declining Lender" has the meaning specified in Section
               2.06(d).

                    "Default" means any Event of Default or any event or
               condition that would constitute an Event of Default but for the
               requirement that notice be given or time elapse or both.

                    "Defaulted Advance" means, with respect to any Lender Party
               at any time, the portion of any Advance required to be made by
               such Lender Party to the Borrower pursuant to Section 2.01 or
               2.02 at or prior to such time that has not been made by such
               Lender Party or by the Administrative Agent for the account of
               such Lender Party pursuant to Section 2.02(e) as of such time. In
               the event that a portion of a Defaulted Advance shall be deemed
               made pursuant to Section 2.16(a), the remaining portion of such
               Defaulted Advance shall be considered a Defaulted Advance
               originally required to be made pursuant to Section 2.01 on the
               same date as the Defaulted Advance so deemed made in part.

                    "Defaulted Amount" means, with respect to any Lender Party
               at any time, any amount required to be paid by such Lender Party
               to the Administrative Agent or any other Lender Party hereunder
               or under any other Loan Document at or prior to such time that
               has not been so paid as of such time, including, without
               limitation, any amount required to be paid by such Lender Party
               to (a) the Swing Line Bank pursuant to Section 2.02(b) to
               purchase a portion of a Swing Line Advance made by the Swing Line
               Bank, (b) the Issuing Bank pursuant to Section 2.03(b) to
               purchase a portion of a Letter of Credit Advance made by the
               Issuing Bank, (c) the Administrative Agent pursuant to Section
               2.02(e) to reimburse the Administrative Agent for the amount of
               any Advance made by the Administrative Agent for the account of
               such Lender Party, (d) any other Lender Party pursuant to Section
               2.14 to purchase any participation in Advances owing to such
               other Lender Party and (e) the Administrative Agent or the
               Issuing Bank pursuant to Section 7.05 to reimburse the
               Administrative Agent or the Issuing Bank for such Lender Party's
               ratable share of any amount required to be paid by the Lender
               Parties to the Administrative Agent or the Issuing Bank as
               provided therein. In the event that a portion of a Defaulted
               Amount shall be deemed paid pursuant to Section 2.16(b), the
               remaining portion of such Defaulted Amount shall be considered a
               Defaulted Amount originally required to be paid hereunder or
               under any other Loan Document on the same date as the Defaulted
               Amount so deemed paid in part.

                    "Defaulting Lender" means, at any time, any Lender Party
               that, at such time, (a) owes a Defaulted Advance or a Defaulted
               Amount or (b) shall take any action or be the subject of any
               action or proceeding of a type described in Section 6.01(f).

                    "Dialysis Facilities" has the meaning specified in Section
               4.01(s).

                    "Documentation Agents" has the meaning specified in the
               recital of parties to this Agreement.

                                       10

<PAGE>

                    "Domestic Person" means a Person that is organized under the
               laws of, or whose property is located in, a jurisdiction within
               the United States.

                    "Domestic Subsidiary" means, at any time, any of the direct
               or indirect Subsidiaries of the Borrower that is incorporated or
               organized under the laws of any state of the United States of
               America or the District of Columbia.

                    "Eligible Assignee" means (a) with respect to any Facility
               (other than the Letter of Credit Facility), (i) a Lender; (ii) an
               Affiliate of a Lender or an Approved Fund of a Lender; (iii) a
               commercial bank organized under the laws of the United States, or
               any State thereof having a combined capital and surplus of at
               least $100,000,000; (iv) a savings and loan association or
               savings bank organized under the laws of the United States, or
               any State thereof having a combined capital and surplus of at
               least $100,000,000; (v) a commercial bank organized under the
               laws of any other country which is a member of the OECD, or a
               political subdivision of any such country, and having a combined
               capital and surplus of at least $100,000,000, provided that such
               bank is acting through a branch, agency or Affiliate located in
               the United States or managed and controlled by a branch, agency
               or affiliate located in the United States; (vi) the central bank
               of any country that is a member of the OECD; (vii) a finance
               company, insurance company or other financial institution, fund
               (whether a corporation, partnership, trust or other entity) or
               other entity that is engaged in making, purchasing or otherwise
               investing in commercial loans in the ordinary course of its
               business and, except with respect to a Term Facility, having
               total assets (inclusive of assets of Affiliates or Approved Funds
               thereof) of at least $100,000,000; and (viii) any other Person
               approved by the Administrative Agent and, provided no Event of
               Default is continuing, the Borrower, provided that the approval
               of the Administrative Agent and the Borrower, when required,
               shall not be unreasonably withheld or delayed, and (b) with
               respect to the Letter of Credit Facility, a Person that is an
               Eligible Assignee under subclause (iii) or (v) of clause (a) of
               this definition and is approved by the Administrative Agent (such
               approval not to be unreasonably withheld or delayed); provided,
               however, that neither any Loan Party nor any Affiliate of a Loan
               Party shall qualify as an Eligible Assignee under this
               definition.

                    "Environmental Action" means any outstanding action, suit,
               demand, demand letter, claim, notice of noncompliance or
               violation, notice of liability or potential liability,
               investigation, proceeding, consent order or consent agreement,
               abatement order or other order or directive (conditional or
               otherwise) relating in any way to any Environmental Law, any
               Environmental Permit or any Hazardous Materials or arising from
               alleged injury or threat to health, safety, natural resources or
               the environment, including, without limitation, (a) by any
               Governmental Authority for enforcement, cleanup, removal,
               response, remedial or other actions or damages and (b) by any
               applicable Governmental Authority or any other third party for
               damages, contribution, indemnification, cost recovery,
               compensation or injunctive relief.

                    "Environmental Law" means any Requirement of Law relating to
               (a) the generation, use, handling, transportation, treatment,
               storage, disposal, release or discharge of Hazardous Materials,
               (b) pollution or the protection of the environment, health,
               safety or natural resources or (c) occupational safety and
               health, industrial hygiene, land use or the protection of human,
               plant or animal health or welfare, including, without limitation,
               CERCLA, in each case as amended from time to time, and including
               the regulations promulgated and the rulings issued from time to
               time thereunder.

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

                                       11

<PAGE>

                    "Equipment" has the meaning specified in Section 1(a) of the
               Security Agreement.

                    "Equity Interests" means, with respect to any Person, all of
               the shares of capital stock of (or other ownership or profit
               interests in) such Person, all of the warrants, options or other
               rights for the purchase or other acquisition from such Person of
               shares of capital stock of (or other ownership or profit
               interests in) such Person, 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 other acquisition from such Person
               of such shares (or such other interests), and all of the other
               ownership or profit interests in such Person (including, without
               limitation, partnership, member or trust interests therein),
               whether voting or nonvoting, and whether or not such shares,
               warrants, options, rights or other interests are authorized or
               otherwise existing on any date of determination.

                    "ERISA" means the Employee Retirement Income Security Act of
               1974, as amended from time to time, and the regulations
               promulgated and the rulings issued from time to time thereunder.

                    "ERISA Affiliate" means any Person that for purposes of
               Title IV of ERISA is a member of the controlled group of any Loan
               Party, or under common control with any Loan Party, within the
               meaning of Section 414 of the Internal Revenue Code.

                    "ERISA Event" means (a)(i) the occurrence of a reportable
               event, within the meaning of Section 4043 of ERISA, with respect
               to any Plan unless the 30-day notice requirement with respect to
               such event has been waived by the PBGC or (ii) the requirements
               of Section 4043(b) of ERISA are met with respect to a
               contributing sponsor, as defined in Section 4001(a)(13) of ERISA,
               of a Plan, and an event described in paragraph (9), (10), (11),
               (12) or (13) of Section 4043(c) of ERISA could reasonably be
               expected to occur with respect to such Plan within the following
               30 days; (b) the application for a minimum funding waiver with
               respect to a Plan; (c) the provision by the administrator of any
               Plan of a notice of intent to terminate such Plan pursuant to
               Section 4041(a)(2) of ERISA (including any such notice with
               respect to a plan amendment referred to in Section 4041(e) of
               ERISA); (d) the cessation of operations at a facility of any Loan
               Party or any ERISA Affiliate in the circumstances described in
               Section 4062(e) of ERISA; (e) the partial or complete withdrawal
               by any Loan Party or any ERISA Affiliate from a Plan or a
               Multiple Employer Plan; (f) the conditions for imposition of a
               lien under Section 302(f) of ERISA shall have been met with
               respect to any Plan; (g) the adoption of an amendment to a Plan
               requiring the provision of security to such Plan pursuant to
               Section 307 of ERISA; or (h) the institution by the PBGC of
               proceedings to terminate a Plan pursuant to Section 4042 of
               ERISA, or the occurrence of any event or condition described in
               Section 4042 of ERISA, that constitutes grounds for the
               termination of, or the appointment of a trustee to administer, a
               Plan.

                    "Eurodollar Lending Office" means, with respect to each of
               the Lenders, the office of such Lender specified as its
               "Eurodollar Lending Office" opposite its name on Schedule I
               hereto or in the Assignment and Assumption pursuant to which it
               became a Lender, as the case may be (or, if no such office is
               specified, its Base Rate Lending Office), or such other office of
               such Lender as such Lender may from time to time specify to the
               Borrower and the Administrative Agent for such purpose.

                    "Eurodollar Rate" means, with respect to any Eurodollar Rate
               Advance for any Interest Period, the rate per annum determined by
               the Administrative Agent at approximately 11:00 a.m. (London
               time) on the date which is two Business Days prior to the
               beginning of such Interest Period by reference to the British
               Bankers' Association Interest Settlement Rates for deposits in

                                       12

<PAGE>

               U.S. dollars (as set forth by any service selected by the
               Administrative Agent which has been nominated by the British
               Bankers' Association as an authorized information vendor for the
               purpose of displaying such rates) for a period equal to such
               Interest Period; provided that, to the extent that an interest
               rate is not ascertainable pursuant to the foregoing provisions of
               this definition the Eurodollar Rate shall be the interest rate
               per annum determined by the Administrative Agent to be the
               average of the rates per annum at which deposits in U.S. dollars
               are offered for such Interest Period to major banks in the London
               interbank market in London, England by the Agent at approximately
               11:00 a.m. (London time) on the date which is two Business Days
               prior to the beginning of such Interest Period. Each
               determination by the Administrative Agent pursuant to this
               definition shall be conclusive absent manifest error.

                    "Eurodollar Rate Advance" means an Advance that bears
               interest as provided in Section 2.07(a)(ii).

                    "Events of Default" has the meaning specified in Section
               6.01.

                    "Exchange Act" means the Securities Exchange Act of 1934, as
               amended from time to time, and the regulations promulgated and
               the rulings issued thereunder.

                    "Existing Credit Agreement" means the Credit Agreement,
               dated as of May 3, 2001, as amended, between the Borrower, the
               lender parties thereto, CSFB, as Syndication Agent, The Bank of
               New York, The Bank of Nova Scotia and Suntrust Bank, as
               Documentation Agents, and BofA, as the Administrative Agent.

                    "Existing Issuing Bank" means BofA, as the issuer of
               Existing Letters of Credit.

                    "Existing Letters of Credit" means all letters of credit
               issued under the Existing Credit Agreement and outstanding on the
               Closing Date, as more fully described on Schedule II hereto.

                    "Facility" means the Term A Facility, the Term B Facility,
               the Revolving Credit Facility, the Swing Line Facility or the
               Letter of Credit Facility, as the context may require.

                    "Federal Funds Rate" means, for any period, a fluctuating
               interest rate per annum equal for each day during such period to
               the weighted average of the rates on overnight federal funds
               transactions with members of the Federal Reserve System arranged
               by federal funds brokers, as published for such day (or, if such
               day is not a Business Day, for the immediately preceding Business
               Day) by the Federal Reserve Bank of New York or, if such rate is
               not so published for any day that is a Business Day, the average
               rate charged to the Administrative Agent (in its individual
               capacity) on such day on such transactions as determined by the
               Administrative Agent.

                    "Fiscal Quarter" means, with respect to the Borrower or any
               of its Subsidiaries, the period commencing January 1 in any
               Fiscal Year and ending on the next succeeding March 31, the
               period commencing April 1 in any Fiscal Year and ending on the
               next succeeding June 30, the period commencing July 1 in any
               Fiscal Year and ending on the next succeeding September 30 or the
               period commencing October 1 in any Fiscal Year and ending on the
               next succeeding December 31, as the context may require, or, if
               any such Subsidiary was not in existence on the first day of any
               such period, the period commencing on the date on which such
               Subsidiary is incorporated, organized, formed or otherwise
               created and ending on the last day of such period.

                    "Fiscal Year" means, with respect to the Borrower or any of
               its Subsidiaries, the period commencing on January 1 in any
               calendar year and ending on the next succeeding December 31

                                       13

<PAGE>

               or, if any such Subsidiary was not in existence on January 1 in
               any calendar year, the period commencing on the date on which
               such Subsidiary is incorporated, organized, formed or otherwise
               created and ending on the next succeeding December 31.

                    "Fixed Charge Coverage Ratio" means, for any period, the
               ratio of (a) the amount equal to (i) the sum of (A) Consolidated
               Pre-Minority EBITDA and (B) Lease Expense less (ii) Capital
               Expenditures, in each case for the Borrower and its Subsidiaries
               for such period, to (b) the sum of (i) Consolidated Interest
               Expense, (ii) the aggregate principal amount (or the equivalent
               thereto) of all Required Principal Payments, (iii) the aggregate
               amount of all Consolidated Cash Taxes, and (iv) Lease Expense, in
               each case for the Borrower and its Subsidiaries for such period.

                    "Foreign Subsidiary" means, at any time, any direct or
               indirect Subsidiary of the Borrower that is not a Domestic
               Subsidiary.

                    "Funded Debt" of any Person means all Debt of such Person
               that by its terms matures more than one year after the date of
               determination or matures within one year from such date but is
               renewable or extendible, at the option of such Person, to a date
               more than one year after such date or arises under a revolving
               credit or similar agreement that obligates the lender or lenders
               to extend credit during a period of more than one year after such
               date, in each case determined on a Consolidated basis in
               accordance with GAAP, including, without limitation, (i) the
               aggregate amount of Governmental Reimbursement Program Costs
               (exclusive of, with respect to the determination of Funded Debt
               in any period, the portion of Governmental Reimbursement Program
               Costs paid in such period) and (ii) in the case of the Borrower,
               the Advances; provided, however, that the term "Funded Debt"
               shall not include (x) any Contingent Obligations of such Person
               (if and to the extent such Contingent Obligations would otherwise
               be included in such term on any date of determination) that are
               incurred solely to support Debt or Governmental Reimbursement
               Program Costs of the Borrower or one or more Subsidiaries of the
               Borrower to the extent such Contingent Obligations are otherwise
               expressly permitted to be incurred under Section 5.02(b), and
               (y) all Obligations of such Person to purchase, redeem, retire,
               defease or otherwise make any payment in respect of any
               Redeemable Preferred Interests.

                    "GAAP" has the meaning specified in Section 1.03.

                    "Governmental Authority" means any nation or government, any
               state, province, city, municipal entity or other political
               subdivision thereof, and any governmental, executive,
               legislative, judicial, administrative or regulatory agency,
               department, authority, instrumentality, commission, board or
               similar body, whether federal, state, provincial, territorial,
               local or foreign.

                    "Governmental Authorization" means any authorization,
               approval, consent, franchise, license, covenant, order, ruling,
               permit, certification, exemption, notice, declaration or similar
               right, undertaking or other action of, to or by, or any filing,
               qualification or registration with, any Governmental Authority.

                    "Governmental Reimbursement Program Costs" means with
               respect to and payable by the Borrower and its Subsidiaries the
               sum of:

                         (i) all amounts (including punitive and other similar
                    amounts) agreed to be paid in settlement or payable as a
                    result of a final, non-appealable judgment, award or similar
                    order relating to participation in Medical Reimbursement
                    Programs;

                                       14

<PAGE>
                         (ii) all final, non-appealable fines, penalties,
                    forfeitures or other amounts rendered pursuant to criminal
                    indictments or other criminal proceedings relating to
                    participation in Medical Reimbursement Programs; and

                         (iii) the amount of final, non-appealable recovery,
                    damages, awards, penalties, forfeitures or similar amounts
                    rendered in any litigation, suit, arbitration, investigation
                    or other legal or administrative proceeding of any kind
                    relating to participation in Medical Reimbursement Programs.

                    "Guarantee Supplement" has the meaning specified in the
               Subsidiary Guarantee.

                    "Guaranteed Obligations" has the meaning specified in the
               Subsidiary Guarantee.

                    "Guarantor" means each Subsidiary of the Borrower party to
               the Subsidiary Guarantee or, as the case may be, a Guarantee
               Supplement.

                    "Hazardous Materials" means (a) petroleum or petroleum
               products, by-products or breakdown products, radioactive
               materials, asbestos-containing materials, polychlorinated
               biphenyls and radon gas and (b) any other chemicals, materials or
               substances designated, classified or regulated as hazardous or
               toxic or as a pollutant or contaminant under any Environmental
               Law.

                    "Hedge Agreements" means, collectively, interest rate swap,
               cap or collar agreements, interest rate future or option
               contracts, commodity future or option contracts, currency swap
               agreements, currency future or option contracts, equity swap
               agreements and other similar agreements.

                    "Hedge Bank" means any Person that is a Lender Party or an
               Affiliate of a Lender Party, in its capacity as a party to a
               Hedge Agreement.

                    "Indemnified Party" has the meaning specified in Section
               8.04(b).

                    "Information Memorandum" means the information memorandum
               dated March 2002 used by the Book Managers in connection with the
               syndication of the Commitments.

                    "Initial Extension of Credit" means, collectively, the
               initial Borrowings under one or more of the Facilities, and/or
               the initial issuances of one or more Letters of Credit, made on
               the Closing Date.

                    "Initial Lenders" has the meaning specified in the recital
               of parties to this Agreement.

                    "Insufficiency" means, with respect to any Plan, the amount,
               if any, of its unfunded benefit liabilities, as defined in
               Section 4001(a)(18) of ERISA.

                    "Intercreditor Agreement" means an Intercreditor Agreement
               dated as of the date hereof duly executed by the Agent on behalf
               of the Lender Parties, the Collateral Agent, as defined therein,
               and any Lender or an Affiliate thereof who is as of such date or
               thereafter a party to a Hedge Agreement.

                    "Interest Period" means, for each Eurodollar Rate Advance
               comprising part of the same Borrowing, the period commencing on
               the date of such Eurodollar Rate Advance or the date of

                                       15

<PAGE>

               the Conversion of any Base Rate Advance into such Eurodollar Rate
               Advance, and ending on the last day of the period selected by the
               Borrower pursuant to the provisions below and, thereafter, each
               subsequent period commencing on the last day of the immediately
               preceding Interest Period and ending on the last day of the
               period selected by the Borrower pursuant to the provisions below.
               The duration of each such Interest Period shall be one, two,
               three or six months, as the Borrower may, upon notice received by
               the Administrative Agent not later than 2:00 P.M. (New York, New
               York time) on the third Business Day prior to the first day of
               such Interest Period, select; provided, however, that:

                         (a) the Borrower may not select any Interest Period
                    with respect to any Eurodollar Rate Advance under a Facility
                    that ends after any principal repayment installment date for
                    such Facility unless, after giving effect to such selection,
                    the aggregate principal amount of Base Rate Advances and of
                    Eurodollar Rate Advances having Interest Periods that end on
                    or prior to such principal repayment installment date for
                    such Facility shall be at least equal to the aggregate
                    principal amount of Advances under such Facility due and
                    payable on or prior to such date;

                         (b) Interest Periods commencing on the same date for
                    Eurodollar Rate Advances comprising part of the same
                    Borrowing shall be of the same duration;

                         (c) whenever the last day of any Interest Period would
                    otherwise occur on a day other than a Business Day, the last
                    day of such Interest Period shall be extended to occur on
                    the next succeeding Business Day; provided, however, that,
                    if such extension would cause the last day of such Interest
                    Period to occur in the next following calendar month, the
                    last day of such Interest Period shall occur on the
                    immediately preceding Business Day; and

                         (d) whenever the first day of any Interest Period
                    occurs on a day of an initial calendar month for which there
                    is no numerically corresponding day in the calendar month
                    that succeeds such initial calendar month by the number of
                    months equal to the number of months in such Interest
                    Period, such Interest Period shall end on the last Business
                    Day of such succeeding calendar month.

                    "Internal Revenue Code" means the Internal Revenue Code of
               1986, as amended from time to time, and the regulations
               promulgated and the rulings issued thereunder.

                    "Investment" means, with respect to any Person, any loan or
               advance to such Person, any purchase or other acquisition of
               Equity Interests in or Debt of, or the property and assets
               comprising a division or business unit or all or a substantial
               part of the business of, such Person, any capital contribution to
               such Person or any other investment in such Person, including,
               without limitation, any acquisition by way of a merger or
               consolidation (or similar transaction) and any arrangement
               pursuant to which the investor incurs Debt of the types referred
               to in clause (j) or (k) of the definition of "Debt" set forth in
               this Section 1.01 in respect of such Person.

                    "ISDA Master Agreement" means the Master Agreement
               (Multicurrency-Cross Border) published by the International Swap
               and Derivatives Association, Inc., as in effect from time to
               time.

                    "Issuing Bank" means (i) CSFB or any Affiliate thereof that
               may from time to time issue Letters of Credit for the account of
               the Borrower, (ii) any other Revolving Credit Lender that

                                       16

<PAGE>

               from time to time agrees in writing to issue Letters of Credit
               hereunder, and (iii) solely with respect to the Existing Letters
               of Credit, the Existing Issuing Bank.

                    "L/C Cash Collateral Account" has the meaning specified in
               the Preliminary Statements to the Security Agreement.

                    "L/C Related Documents" has the meaning specified in Section
               2.03(b)(ii).

                    "Lease Expense" means, with respect to any Person, for any
               period for such Person and its subsidiaries on a Consolidated
               basis, lease and rental expense accrued during such period under
               all leases and rental agreements, other than Capitalized Leases
               and leases of personal property, of renal treatment centers,
               determined in conformity with GAAP.

                    "Lender Party" means any Lender, the Issuing Bank or the
               Swing Line Bank.

                    "Lenders" means, collectively, the Initial Lenders and each
               Person that becomes a Lender pursuant to Section 8.07 for so long
               as such Initial Lender or Person, as the case may be, shall be a
               party to this Agreement.

                    "Letter of Credit" has the meaning specified in Section
               2.01(e).

                    "Letter of Credit Advance" means an advance made by an
               Issuing Bank or any Revolving Credit Lender pursuant to Section
               2.03(b).

                    "Letter of Credit Agreement" has the meaning specified in
               Section 2.03(a).

                    "Letter of Credit Facility" means, at any time, an amount
               equal to the lesser of (a) the aggregate amount of the Unused
               Revolving Credit Commitments of the Issuing Banks at such time
               and (b) $50,000,000, as such amount may be reduced at or prior to
               such time pursuant to Section 2.05.

                    "Leverage Ratio" means, at any date of determination, the
               ratio of (a) (i) all Funded Debt of the Borrower and its
               Subsidiaries plus (ii) to the extent not otherwise included in
               subclause (a)(i) of this definition, the face amount of all
               Letters of Credit issued for the account of the Borrower or any
               of its Subsidiaries minus (iii) cash and cash equivalents of the
               Borrower and its Subsidiaries on a Consolidated basis to
               (b) Consolidated Pre-Minority EBITDA of the Borrower and its
               Subsidiaries for the most recently completed Measurement Period
               prior to such date.

                    "Lien" means, with respect to any Person, (a) any mortgage,
               lien (statutory or other), pledge, hypothecation, security
               interest, charge or encumbrance of any kind (including, without
               limitation, any agreement to give any of the foregoing), (b) any
               sale of accounts receivable or chattel paper, or any assignment,
               deposit arrangement or lease intended as, or having the effect
               of, security, (c) any easement, right of way or other encumbrance
               on title to real property or (d) any other interest or title of
               any vendor, lessor, lender or other secured party to or of such
               Person under any conditional sale or other title retention
               agreement or any Capitalized Lease or upon or with respect to any
               property or asset of such Person (including, in the case of
               Equity Interests, voting trust agreements and other similar
               arrangements).

                    "Loan Documents" means, collectively, this Agreement, the
               Notes, the Subsidiary Guarantee, the Collateral Documents and
               each Letter of Credit Agreement, in each case as

                                       17

<PAGE>

               amended, supplemented or otherwise modified hereafter from time
               to time in accordance with the terms thereof and Section 8.01.

                    "Loan Parties" means, collectively, the Borrower and each of
               the Subsidiaries of the Borrower party to the Subsidiary
               Guarantee or any of the Collateral Documents.

                    "Margin Stock" means `margin stock' as defined in Regulation
               U of the Board of Governors of the Federal Reserve System, as the
               same may be amended or supplemented from time to time.

                    "Material Adverse Change" means any material adverse change
               in the business, condition (financial or otherwise), operations,
               performance, properties or prospects of the Borrower and its
               Subsidiaries, taken as a whole; provided that the occurrence or
               subsistence of any such material adverse change which has been
               disclosed by the Borrower in any filing made with the Securities
               and Exchange Commission prior to the date of this Agreement shall
               not constitute a Material Adverse Change.

                    "Material Adverse Effect" means a material adverse effect on
               (a) the business, condition (financial or otherwise), operations,
               performance, properties or prospects of the Borrower and its
               Subsidiaries taken as a whole, (b) the rights and remedies of the
               Administrative Agent or any Lender Party under any Loan Document
               or (c) the ability of any Loan Party to perform its Obligations
               under any Loan Document to which it is or is to be a party;
               provided that the occurrence or subsistence of any such material
               adverse effect which has been disclosed by the Borrower in any
               filing made with the Securities and Exchange Commission prior to
               the date of this Agreement shall not constitute a Material
               Adverse Effect.

                    "Material Subsidiaries" means, as of any date, any
               Subsidiary or Subsidiaries of the Borrower that either
               individually or taken as a whole accounted for more than 5% of
               Consolidated Net Income of the Borrower and its Subsidiaries for
               the most recently completed Fiscal Quarter on or prior to such
               date, in each case as reflected in the Required Financial
               Information most recently delivered to the Administrative Agent
               and the Lender Parties on or prior to such date and determined in
               accordance with GAAP for such period.

                    "Measurement Period" means, at any date of determination,
               the most recently completed four consecutive Fiscal Quarters
               ended prior to such date for which financial information is
               available.

                    "Medicaid" means that means-tested entitlement program under
               Title XIX of the Social Security Act that provides federal grants
               to states for medical assistance based on specific eligibility
               criteria. (Social Security Act of 1965, Title XIX, P.L. 89-87, as
               amended; 42 U.S.C. 1396 et seq.).

                    "Medical Reimbursement Programs" means the Medicare,
               Medicaid and CHAMPUS programs and any other health care program
               operated by or financed in whole or in part by any federal, state
               or local government.

                    "Medicare" means that government-sponsored entitlement
               program under Title XVIII of the Social Security Act that
               provides for a health insurance system for eligible elderly and
               disabled individuals. (Social Security Act of 1965, Title XVIII,
               P.L. 89-87 as amended; 42 U.S.C. 1395 et seq.).

                                       18

<PAGE>

                    "Moody's" means Moody's Investors Service, Inc.

                    "Multiemployer Plan" means a multiemployer plan (as defined
               in Section 4001(a)(3) of ERISA) to which any Loan Party or any
               ERISA Affiliate is making or accruing an obligation to make
               contributions, or has within any of the preceding five plan years
               made or accrued an obligation to make contributions.

                    "Multiple Employer Plan" means a single employer plan (as
               defined in Section 4001(a)(15) of ERISA) that (a) is maintained
               for employees of any Loan Party or any ERISA Affiliate and at
               least one Person other than the Loan Parties and the ERISA
               Affiliates or (b) was so maintained and in respect of which any
               Loan Party or any ERISA Affiliate could reasonably be expected to
               have liability under Section 4064 or 4069 of ERISA in the event
               such plan has been or were to be terminated.

                    "Net Cash Proceeds" means, with respect to any sale, lease,
               transfer or other disposition of any property or asset, or the
               incurrence or issuance of any Debt, or the sale or issuance of
               any Equity Interests (including, without limitation, any capital
               contribution) in any Person, the aggregate amount of cash
               received from time to time (whether as initial consideration or
               through payment or disposition of deferred consideration) by or
               on behalf of such Person for its own account in connection with
               any such transaction, after deducting therefrom only (without
               duplication):

                         (a) out-of-pocket expenses, including brokerage
                    commissions, underwriting fees and discounts, legal fees,
                    finder's fees and other similar fees and commissions;

                         (b) the amount of taxes payable in connection with or
                    as a result of such transaction, and if not paid at the time
                    of the respective transaction, the amount thereof reserved
                    in accordance with GAAP as in effect on the date of
                    determination;

                         (c) in the case of any sale, lease, transfer or other
                    disposition of any property or asset, the outstanding
                    principal amount of, the premium or penalty, if any, on, and
                    any accrued and unpaid interest on, any Debt (other than the
                    Debt outstanding under the Loan Documents) that is secured
                    by a Lien on the property and assets subject to such sale,
                    lease, transfer or other disposition and is required to be
                    repaid under the terms thereof as a result of such sale,
                    lease, transfer or other disposition;

                         (d) in the case of any sale, lease, transfer or other
                    disposition of any property or asset, an amount reserved, in
                    accordance with GAAP as in effect on the date on which the
                    Net Cash Proceeds from such sale, lease, transfer or other
                    disposition are determined, and so reserved, against
                    liabilities under indemnification obligations, liabilities
                    related to environmental matters or other liabilities
                    associated with the property and assets subject to such
                    sale, lease, transfer or other disposition that are required
                    to be so provided for under the terms of the documentation
                    for such sale, lease, transfer or other disposition; and

                         (e) in the case of any sale, lease, transfer or other
                    disposition of any property or asset by a Subsidiary, the
                    amount of any payments or distributions required to be made
                    in respect of such transaction to owners of Equity Interests
                    in such Subsidiary other than the Borrower or any other
                    Subsidiary;

                                       19

<PAGE>

               provided, however, in the case of clauses (b) and (d) of this
               definition, that if, at the time such taxes or such contingent
               liabilities are actually paid or otherwise satisfied, the amount
               of the reserve therefor exceeds the amount paid or otherwise
               satisfied, then the Borrower shall prepay the outstanding
               Advances in accordance with the terms of Section 2.06(b), in an
               amount equal to the amount of such excess reserve.

                    "Note" means a Term A Note, a Term B Note or a Revolving
               Credit Note, as the context may require.

                    "Notice of Borrowing" has the meaning specified in Section
               2.02(a).

                    "Notice of Conversion" has the meaning specified in Section
               2.09(a).

                    "Notice of Covenant Reduction" means, with respect to any
               restricted payment pursuant to Section 5.02(g)(vi)(C), a notice
               substantially in the form of Exhibit I hereto duly executed by a
               Responsible Officer of the Borrower specifying that (i)
               immediately prior to such restricted payment and after giving pro
               forma effect thereto the Leverage Ratio is less than 3.00:1.00
               and the Senior Leverage Ratio is less than 1.75:1.00 and (ii) at
               all times thereafter, for purposes of Section 5.04(a) and (e),
               respectively, the Leverage Ratio shall be 3.00:1.00 and the
               Senior Leverage Ratio shall be 1.75:1.00.

                    "Notice of Issuance" has the meaning specified in Section
               2.03(a).

                    "Notice of Renewal" has the meaning specified in Section
               2.01(e).

                    "Notice of Swing Line Borrowing" has the meaning specified
               in Section 2.02(b).

                    "Notice of Termination" has the meaning specified in Section
               2.01(e).

                    "NPL" means the National Priorities List under CERCLA.

                    "Obligation" means, with respect to any Person, any payment,
               performance or other obligation of such Person of any kind,
               including, without limitation, any liability of such Person on
               any claim, whether or not the right of any creditor to payment in
               respect of such claim is reduced to judgment, liquidated,
               unliquidated, fixed, contingent, matured, disputed, undisputed,
               legal, equitable, secured or unsecured, and whether or not such
               claim is discharged, stayed or otherwise affected by any
               proceeding referred to in Section 6.01(f). Without limiting the
               generality of the foregoing, the Obligations of the Loan Parties
               under the Loan Documents include (a) the obligation to pay
               principal, interest, Letter of Credit commissions, charges,
               expenses, fees, attorneys' fees and disbursements, indemnity
               payments and other amounts payable by any Loan Party under any
               Loan Document and (b) the obligation of any Loan Party to
               reimburse any amount in respect of any of the foregoing items
               that any Lender Party, in its sole discretion, may elect to pay
               or advance on behalf of such Loan Party.

                    "OECD" means the Organization for Economic Cooperation and
               Development.

                    "Open Year" means, with respect to any Person, any year for
               which United States federal income tax returns have been filed by
               or on behalf of such Person and for which the expiration of the
               applicable statute of limitations for assessment or collection
               has not occurred (whether by reason of extension or otherwise).

                                       20

<PAGE>

                    "Other Taxes" has the meaning specified in Section 2.13(b).

                    "PBGC" means the Pension Benefit Guaranty Corporation or any
               successor thereto.

                    "Performance Level" means Performance Level I, Performance
               Level II, Performance Level III, Performance Level IV or
               Performance Level V, as identified in the definition of
               "Applicable Margin", as the context may require.

                    "Permitted Liens" means the following types of Liens
               (excluding any such Lien imposed pursuant to Section 401(a)(29)
               or 412(n) of the Internal Revenue Code or by ERISA or any such
               Lien relating to or imposed in connection with any Environmental
               Action): (a) Liens for taxes, assessments and governmental
               charges or levies to the extent not otherwise required to be paid
               under Section 5.01(b); (b) Liens imposed by law, such as
               materialmen's, mechanics', carriers', landlords', workmen's and
               repairmen's Liens and other similar Liens arising in the ordinary
               course of business securing obligations (other than Debt for
               borrowed money) (i) that are not overdue for a period of more
               than 60 days or (ii) the amount, applicability or validity of
               which are being contested in good faith and by appropriate
               proceedings diligently conducted and with respect to which the
               Borrower or any of its Subsidiaries, as the case may be, has
               established reserves in accordance with GAAP; (c) pledges or
               deposits to secure obligations incurred in the ordinary course of
               business under workers' compensation laws, unemployment insurance
               or similar social security legislation (other than in respect of
               employee benefit plans subject to ERISA) or to secure public or
               statutory obligations; (d) Liens, pledges and deposits securing
               the performance of, or payment in respect of, bids, tenders,
               leases, contracts (other than for the repayment of borrowed
               money), surety and appeal bonds, letters of credit, and other
               obligations of a similar nature incurred in the ordinary course
               of business; (e) any interest or title of a lessor or sublessor
               and any restriction or encumbrance to which the interest or title
               of such lessor or sublessor may be subject that is incurred in
               the ordinary course of business and, either individually or when
               aggregated with all other Permitted Liens in effect on any date
               of determination, could not be reasonably expected to have a
               Material Adverse Effect; (f) Liens in favor of customs and
               revenue authorities arising as a matter of law or pursuant to a
               bond to secure payment of customs duties in connection with the
               importation of goods; (g) Liens arising out of judgments or
               awards that do not constitute an Event of Default under Section
               6.01(g) or 6.01(h) and in respect of which the Borrower or any of
               its Subsidiaries subject thereto shall be prosecuting an appeal
               or proceedings for review in good faith and, pending such appeal
               or proceedings, shall have secured within 30 days after the entry
               thereof a subsisting stay of execution and shall be maintaining
               reserves, in accordance with GAAP, with respect to any such
               judgment or award; (h) unperfected Liens of suppliers and vendors
               to secure the purchase price of the property or assets sold;
               (i) protective Uniform Commercial Code filings by lessors under
               operating leases; and (j) any easements, rights of way,
               restrictions, defects, encroachments and other encumbrances on
               title to real property which either individually or when
               aggregated with all other permitted Liens, would not be
               reasonably expected to have a Material Adverse Effect.

                    "Person" means an individual, partnership, corporation
               (including a business trust), limited liability company,
               unlimited liability company, joint stock company, trust,
               unincorporated association, joint venture or other entity, or a
               government or any political subdivision or agency thereof.

                    "Plan" means a Single Employer Plan or a Multiple Employer
               Plan.

                    "Pledged Debt" has the meaning specified in Section 1 of the
               Security Agreement.

                                       21

<PAGE>

                    "Pledged Shares" has the meaning specified in Section 1 of
               the Security Agreement.

                    "Prepayment Date" has the meaning specified in Section
               2.06(d).

                    "primary obligation" has the meaning specified in the
               definition of "Contingent Obligation" set forth in this Section
               1.01.

                    "primary obligor" has the meaning specified in the
               definition of "Contingent Obligation" set forth in this Section
               1.01.

                    "Pro Rata Share" of any amount means, with respect to any of
               the Lenders at any time, the product of (a) a fraction the
               numerator of which is the amount of such Lender's Commitment(s)
               under the applicable Facility or Facilities at such time (or, if
               the Commitments shall have been terminated pursuant to Section
               2.05 or 6.01 at or prior to such time, such Lender's
               Commitment(s) under the applicable Facility or Facilities as in
               effect immediately prior to such termination) and the denominator
               of which is the aggregate amount of such Facility or Facilities
               at such time (or, if the Commitments shall have been terminated
               pursuant to Section 2.05 or 6.01 at or prior to such time, the
               applicable Facility or Facilities as in effect immediately prior
               to such termination) multiplied by (b) such amount.

                    "Qualified Issuer" means (a) any Lender hereunder and (b)
               any commercial bank that has a combined capital and surplus in
               excess of $100,000,000.

                    "Reedemable Preferred Interest" means with respect to any
               Person, (a) any Equity Interest of such Person that, by its terms
               or by the terms of any security into which it is convertible,
               exercisable or exchangeable, is, or upon the happening of an
               event or the passage of time or both would be, required to be
               redeemed or repurchased (including at the option of the holder
               thereof) by such Person or any of its Subsidiaries, in whole or
               in part, not earlier than July 1, 2009, and (b) any Equity
               Interest of any Subsidiary of such Person other than any common
               equity with no preferences, privileges, and no redemption or
               repayment provisions; provided, however, that any Equity Interest
               that would constitute a Redeemable Preferred Interest solely
               because the holders thereof have the right to require the issuer
               to repurchase such a Redeemable Preferred Interest upon the
               occurrence of a change of control shall not be so treated if the
               terms thereof (a) do not trigger any rights upon any circumstance
               constituting a change of control under such Redeemable Preferred
               Interest that would not constitute a Change of Control under this
               Agreement and (b) do not permit either any repurchase by such
               Person or any rights of the holder of such Equity Interest to
               assert any claim in respect of such failure to purchase as long
               as any Event of Default exists hereunder.

                    "Reduction Amount" has the meaning specified in Section
               2.06(b)(iv).

                    "Register" has the meaning specified in Section 8.07(c).

                    "Regulation U" means Regulation U of the Board of Governors
               of the Federal Reserve System, as in effect from time to time.

                    "Required Financial Information" means, at any date of
               determination, the Consolidated financial statements of the
               Borrower and its Subsidiaries most recently delivered to the
               Administrative Agent and the Lender Parties on or prior to such
               date pursuant to, and satisfying all of the requirements of,
               Section 5.03(b) or 5.03(c) and accompanied by the certificates
               and other information required to be delivered therewith.

                                       22

<PAGE>

                    "Required Lenders" means, at any time, Lenders owed or
               holding at least a majority in interest of the sum of (a) the
               aggregate principal amount of the Advances outstanding at such
               time, (b) the aggregate Available Amount of all Letters of Credit
               outstanding at such time, and (c) the aggregate Unused Revolving
               Credit Commitments at such time; provided, however, that if any
               Lender shall be a Defaulting Lender at such time, there shall be
               excluded from the determination of Required Lenders at such time
               (A) the aggregate principal amount of the Advances owing to such
               Lender (in its capacity as a Lender) and outstanding at such
               time, (B) such Lender's Pro Rata Share of the aggregate Available
               Amount of all Letters of Credit issued by such Lender and
               outstanding at such time, and (C) the Unused Revolving Credit
               Commitment of such Lender at such time. For purposes of this
               definition, the aggregate principal amount of Swing Line Advances
               owing to the Swing Line Bank and of Letter of Credit Advances
               owing to the Issuing Bank and the Available Amount of each Letter
               of Credit shall be considered to be owed to the Revolving Credit
               Lenders ratably in accordance with their respective Revolving
               Credit Commitments.

                    "Required Principal Payments" means, with respect to any
               Person for any period, the sum of all regularly scheduled
               principal payments or redemptions and all required prepayments,
               repurchases, redemptions or similar acquisitions for value of
               outstanding Funded Debt made during such period.

                    "Requirements of Law" means, with respect to any Person, all
               laws, constitutions, statutes, treaties, ordinances, rules and
               regulations, all orders, writs, decrees, injunctions, judgments,
               determinations and awards of an arbitrator, a court or any other
               Governmental Authority, and all Governmental Authorizations,
               binding upon or applicable to such Person or to any of its
               properties, assets or businesses.

                    "Responsible Officer" means, with respect to the Borrower or
               any of its Subsidiaries, the chief executive officer, the
               president, the chief financial officer, the principal accounting
               officer or the treasurer (or the equivalent of any of the
               foregoing) or any other officer, partner or member (or person
               performing similar functions) of the Borrower or any such
               Subsidiary responsible for overseeing the administration of, or
               reviewing compliance with, all or any portion of this Agreement
               or any of the other Loan Documents.

                    "Revolving Credit Advance" has the meaning specified in
               Section 2.01(c).

                    "Revolving Credit Borrowing" means a borrowing consisting of
               simultaneous Revolving Credit Advances of the same Type made by
               the Revolving Credit Lenders.

                    "Revolving Credit Commitment" means, with respect to any
               Revolving Credit Lender at any time, the amount set forth
               opposite such Revolving Credit Lender's name on Schedule I hereto
               under the caption "Revolving Credit Commitment" or, if such
               Revolving Credit Lender has entered into one or more Assignment
               and Assumptions, the amount set forth for such Revolving Credit
               Lender in the Register maintained by the Administrative Agent
               pursuant to Section 8.07(c) as such Revolving Credit Lender's
               "Revolving Credit Commitment", as such amount may be reduced at
               or prior to such time pursuant to Section 2.05.

                    "Revolving Credit Facility" means, at any time, the
               aggregate amount of the Revolving Credit Lenders' Revolving
               Credit Commitments at such time.

                    "Revolving Credit Lender" means, at any time, any Lender
               that has a Revolving Credit Commitment or Revolving Credit
               Advance, as the case may be, at such time.

                                       23

<PAGE>

                    "Revolving Credit Note" means a promissory note of the
               Borrower payable to the order of any Revolving Credit Lender, in
               substantially the form of Exhibit A-3 hereto, evidencing the
               aggregate indebtedness of the Borrower to such Revolving Credit
               Lender resulting from the Revolving Credit Advances made by such
               Revolving Credit Lender.

                    "S&P" means Standard & Poor's, a division of The McGraw-Hill
               Companies, Inc.

                    "Secured Obligations" has the meaning specified in Section 2
               of the Security Agreement.

                    "Secured Parties" means, collectively, the Agents, the
               Lender Parties, 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.

                    "Securities Act" means the Securities Act of 1933, as
               amended, and the regulations promulgated and the rulings issued
               thereunder.

                    "Security Agreement" has the meaning specified in Section
               3.01(a)(ii).

                    "Security Agreement Supplement" has the meaning specified in
               Section 24 of the Security Agreement.

                    "Senior Leverage Ratio" means, at any date of determination,
               the ratio of (a)(i) all Funded Debt of the Borrower and its
               Subsidiaries plus (ii) to the extent not otherwise included in
               subclause (a)(i) of this definition, the face amount of all
               outstanding Letters of Credit issued for the account of the
               Borrower or any of its Subsidiaries minus (iii) cash and cash
               equivalents of the Borrower and its Subsidiaries on a
               Consolidated basis minus (iv) all Subordinated Debt of the
               Borrower and its Subsidiaries to (b) Consolidated Pre-Minority
               EBITDA of the Borrower and its Subsidiaries for the most recently
               completed Measurement Period prior to such date.

                    "Single Employer Plan" means a single employer plan (as
               defined in Section 4001(a)(15) of ERISA) that (a) is maintained
               for employees of any Loan Party or any ERISA Affiliate and no
               Person other than the Loan Parties and the ERISA Affiliates or
               (b) was so maintained and in respect of which any Loan Party or
               any ERISA Affiliate could have liability under Section 4069 of
               ERISA in the event such plan has been or were to be terminated.

                    "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 and assets of such Person is greater than the
               total amount of liabilities (including, without limitation,
               contingent liabilities), of such Person, (b) the present fair
               salable value of the property and 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, and does not believe
               that it will, incur debts or liabilities beyond such Person's
               ability to pay such debts and liabilities as they mature and (d)
               such Person is not engaged in business or in a transaction, and
               is not about to engage in business or in a transaction, for which
               such Person's property and assets would constitute an
               unreasonably small capital. The amount of contingent liabilities
               of any such Person at any time shall be computed as the amount
               that, in the light of all of the facts and circumstances existing
               at such time, represents the amount that can reasonably be
               expected to become an actual or matured liability.

                    "Special Purpose Licensed Entity" means any Person in a
               related business of the Borrower and its Subsidiaries that (i)
               the Borrower and its Subsidiaries are prohibited from

                                       24

<PAGE>

               engaging in directly under applicable law, including provisions
               of state law (a) prohibiting the ownership of healthcare
               facilities by public companies, (b) prohibiting the corporate
               practice of medicine or (c) otherwise restricting the ability of
               the Borrower or one of its Subsidiaries to acquire directly a
               required license to operate a healthcare facility, and (ii) has
               entered into a transaction or series of transactions with the
               Borrower or any of its Subsidiaries under which:

                         (x) the Borrower or any of its Subsidiaries provides
                    management, administrative or consulting services to the
                    Special Purpose Licensed Entity,

                         (y) the owners of the Special Purpose Licensed Entity
                    are prohibited from transferring any of their interests in
                    the Special Purpose Licensed Entity without the consent of
                    the Borrower or one of its Subsidiaries, and

                         (z) the Borrower or one of its Subsidiaries has the
                    right to require the owners of the Special Purpose Licensed
                    Entity to transfer all of their interests in the Special
                    Purpose Licensed Entity to a Person designated by the
                    Borrower or one of its Subsidiaries.

                    "Subordinated Debt" means the subordinated debt evidenced by
               the Subordinated Notes or other subordinated Debt issued or
               incurred by the Borrower subordinated in right of payment to the
               payment in full of the Obligations of the Borrower to the Loan
               Parties under the Loan Documents and other senior obligations of
               the Borrower; provided that (i) the negative covenants in such
               subordinated Debt are less burdensome than the negative covenants
               in this Agreement as in effect at the time such subordinated Debt
               is incurred, (ii) the affirmative covenants in such subordinated
               Debt are no more burdensome than the affirmative covenants in
               this Agreement as in effect at the time such subordinated Debt is
               incurred, (iii) the events of default in such subordinated Debt
               relating to insolvency and nonpayment of amounts owed thereunder
               are no more restrictive than the corresponding defaults in this
               Agreement as in effect at the time such subordinated Debt is
               incurred, (iv) such subordinated Debt does not cross-default to
               other Debt (but may cross-accelerate to other Debt of Borrower or
               any Subsidiary that has guaranteed such subordinated Debt), (v)
               the subordination provisions in such subordinated Debt are either
               (A) reasonably satisfactory to the Administrative Agent or (B)
               confirmed by a nationally recognized investment bank (that is not
               the Administrative Agent) as market terms and conditions at such
               time for similar debt securities issued by Persons whose debt
               securities have credit ratings not greater than that of the
               Borrower, and (vi) such subordinated Debt does not provide for
               any scheduled payment or mandatory prepayment of principal
               earlier than July 1, 2009, other than (x) redemptions made at the
               option of the holders of such subordinated Debt upon a change in
               control of the Borrower in circumstances that would also
               constitute a Change of Control under this Agreement (provided
               that any such redemption cannot be made fewer than 30 days after
               such change in control and that any such redemption is fully and
               absolutely subordinated to the indefeasible payment in full of
               all principal, interest and other amounts under the Loan
               Documents) and (y) mandatory prepayments required as a result of
               asset dispositions if such subordinated Debt allows the Borrower
               to satisfy such mandatory prepayment requirement by prepayment of
               Loans under this Agreement or other senior obligations of the
               Borrower or reinvestment of the asset disposition proceeds within
               a specified period of time.

                    "Subordinated Notes" means (i) the 5 5/8% convertible
               subordinated notes of Renal Treatment Centers, Inc. due 2006 in
               the aggregate principal amount of $125,000,000 issued pursuant to
               the Indenture dated June 12, 1996 between Rental Treatment
               Centers, Inc. and PNC Bank, National Association as trustee; (ii)
               the 7% convertible subordinated notes of the Borrower (f/k/a
               Total Renal Care Holdings, Inc.) due 2009 in the aggregate
               principal amount of

                                       25

<PAGE>

               $345,000,000 issued pursuant to the Indenture dated November 18,
               1998 between Total Renal Care Holdings, Inc. and United States
               Trust Company of New York as trustee; and (iii) the 2001
               Subordinated Notes.

                    "Subordinated Notes Documents" means the Subordinated Notes,
               any indentures or other agreements, instruments and other
               documents pursuant to which the Subordinated Notes or other
               Subordinated Debt have been or will be issued or otherwise
               setting forth the terms of the Subordinated Notes or such
               Subordinated Debt, including guarantees in respect of the
               Subordinated Debt referred to in clauses (i) and (iii) of the
               definition of "Subordinated Notes," in each case as such
               agreement, instrument or other document may be amended,
               supplemented or otherwise modified from time to time in
               accordance with the terms thereof, but only to the extent
               permitted under the terms of the Loan Documents.

                    "Subsidiary Guarantee" has the meaning specified in Section
               3.01(a)(iii).

                    "Subsidiary" of any Person means any corporation,
               partnership, joint venture, limited liability company, unlimited
               liability company, trust or estate of which (or in which) more
               than 50% of (a) the issued and outstanding shares of capital
               stock having ordinary voting power to elect a majority of the
               board of directors of such corporation (irrespective of whether
               at the time shares of capital stock of any other class or classes
               of such corporation shall or might have voting power upon the
               occurrence of any contingency), (b) the interest in the capital
               or profits of such partnership, joint venture, limited liability
               company or unlimited liability company or (c) the beneficial
               interest in such trust or estate, is at the time directly or
               indirectly owned or controlled by such Person, by such Person and
               one or more of its other Subsidiaries or by one or more of such
               Person's other Subsidiaries, provided however, that the entities
               listed on Exhibit H attached hereto shall not be deemed
               Subsidiaries for so long as the assets of each such entity does
               not exceed $25,000.

                    "Swing Line Advance" means an advance made by (a) the Swing
               Line Bank pursuant to Section 2.01(d) or (b) simultaneous Swing
               Line Advances made by the Revolving Credit Lenders pursuant to
               Section 2.02(b).

                    "Swing Line Bank" has the meaning specified in the recital
               of parties to this Agreement.

                    "Swing Line Borrowing" means a borrowing consisting of a
               Swing Line Advance made by the Swing Line Bank.

                    "Swing Line Commitment" means, with respect to the Swing
               Line Bank at any time, the amount set forth opposite the Swing
               Line Bank's name on Schedule I hereto under the caption "Swing
               Line Commitment", as such amount may be reduced at or prior to
               such time pursuant to Section 2.05.

                    "Swing Line Facility" means, at any time, an amount equal to
               the lesser of (a) the amount of the Swing Line Commitment at such
               time and (b) $25,000,000, as such amount may be reduced at or
               prior to such time pursuant to Section 2.05.

                    "2001 Subordinated Notes" means the 91/4% senior
               subordinated notes of the Borrower due April 15, 2011, in the
               aggregate principal amount of $225,000,000 issued pursuant to the
               Indenture dated April 11, 2001 between the Borrower, certain of
               its Subsidiaries and U.S. Trust Company of Texas, N.A

                                       26

<PAGE>

                    "Taxes" has the meaning specified in Section 2.13(a).

                    "Term Advance" means a Term A Advance or a Term B Advance.

                    "Term A Advance" has the meaning specified in Section
               2.01(a).

                    "Term A Borrowing" means a borrowing consisting of
               simultaneous Term A Advances of the same Type made by the Term A
               Lenders.

                    "Term A Commitment" means, with respect to any of the Term A
               Lenders at any time, the amount set forth opposite such Term A
               Lender's name on Schedule I hereto under the caption "Term A
               Commitment" or, if such Term A Lender has entered into one or
               more Assignment and Assumptions, the amount set forth for such
               Term A Lender in the Register maintained by the Administrative
               Agent pursuant to Section 8.07(c) as such Term A Lender's "Term
               Commitment", as such amount may be reduced at or prior to such
               time pursuant to Section 2.05.

                    "Term A Facility" means, at any time, the aggregate Term A
               Commitments of all Term A Lenders at such time.

                    "Term A Lender" means, at any time, any Lender that has a
               Term A Commitment or a Term A Advance, as the case may be, at
               such time.

                    "Term A Note" means a promissory note of the Borrower
               payable to the order of any Term A Lender, in substantially the
               form of Exhibit A-1 hereto, evidencing the indebtedness of the
               Borrower to such Term A Lender resulting from the Term A Advance
               made by such Term A Lender.

                    "Term B Advance" has the meaning specified in Section
               2.01(b).

                    "Term B Borrowing" means a borrowing consisting of
               simultaneous Term B Advances of the same Type made by the Term B
               Lenders.

                    "Term B Commitment" means, with respect to any of the Term B
               Lenders at any time, the amount set forth opposite such Term B
               Lender's name on Schedule I hereto under the caption "Term B
               Commitment" or, if such Term B Lender has entered into one or
               more Assignment and Assumptions, the amount set forth for such
               Term B Lender in the Register maintained by the Administrative
               Agent pursuant to Section 8.07(c) as such Term B Lender's "Term
               Commitment", as such amount may be reduced at or prior to such
               time pursuant to Section 2.05.

                    "Term B Facility" means, at any time, the aggregate Term B
               Commitments of all Term B Lenders at such time.

                    "Term B Lender" means, at any time, any Lender that has a
               Term B Commitment or a Term B Advance, as the case may be, at
               such time.

                    "Term B Note" means a promissory note of the Borrower
               payable to the order of any Term B Lender, in substantially the
               form of Exhibit A-2 hereto, evidencing the indebtedness of the
               Borrower to such Term B Lender resulting from the Term B Advances
               made by such Term B Lender.

                                       27

<PAGE>

                    "Term Commitment" means a Term A Commitment or a Term B
               Commitment, as the context requires.

                    "Term Facility" means a Term A Facility or a Term B
               Facility, as the context requires.

                    "Term Lender" means a Term A Lender or a Term B Lender, as
               the context requires.

                    "Termination Date" means the earlier of (a) April 26, 2007
               and (b) the date of termination in whole of the Swing Line
               Commitments and the Revolving Credit Commitments pursuant to
               Section 2.05 or 6.01.

                    "Transaction" means, collectively, (a) the entering into by
               the Loan Parties of the Loan Documents, to which they are or are
               intended to be a party, (b) the purchase by the Borrower of the
               2001 Subordinated Notes, (c) the purchase by the Borrower of its
               common stock as contemplated in Section 5.02(g)(v) and (d) the
               payment of the fees and expenses incurred in connection with the
               consummation of the foregoing.

                    "TRC" means Total Renal Care, Inc., a California
               corporation.

                    "Type" refers to the distinction between Advances bearing
               interest at the Base Rate and Advances bearing interest at the
               Eurodollar Rate.

                    "Unused Revolving Credit Commitment" means, with respect to
               any Revolving Credit Lender at any time, (a) such Revolving
               Credit Lender's Revolving Credit Commitment at such time minus
               (b) the sum of (i) the aggregate principal amount of all
               Revolving Credit Advances, Swing Line Advances and Letter of
               Credit Advances made by such Revolving Credit Lender (in its
               capacity as a Lender) and outstanding at such time and (ii) such
               Lender's Pro Rata Share of (A) the aggregate Available Amount of
               all Letters of Credit outstanding at such time, (B) the aggregate
               principal amount of all Letter of Credit Advances made by the
               Issuing Bank pursuant to Section 2.03(b) and outstanding at such
               time and (C) the aggregate principal amount of all Swing Line
               Advances made by the Swing Line Bank pursuant to Section 2.01(d)
               and outstanding at such time.

                    "Voting Interests" means shares of capital stock issued by a
               corporation, or equivalent Equity Interests in any other Person,
               the holders of which are ordinarily, in the absence of
               contingencies, entitled to vote for the election of directors (or
               persons performing similar functions) of such Person, even if the
               right so to vote has been suspended by the happening of such a
               contingency.

                    "Welfare Plan" means a welfare plan (as defined in Section
               3(1) of ERISA) that is maintained for employees of any Loan Party
               or in respect of which any Loan Party could reasonably be
               expected to have liability.

                    "Withdrawal Liability" has the meaning specified in Part I
               of Subtitle E of Title IV of ERISA.

     SECTION 1.02. Computation of Time Periods; Other Definitional Provisions.
In this Agreement and the other Loan Documents, in the computation of periods of
time from a specified date to a later specified date, the word "from" means
"from and including", the word "through" means "through and including" and the
words "to" and "until" each means "to but excluding." References in this
Agreement or any of the other Loan Documents to any agreement , instrument or
other document "as amended" shall

                                       28

<PAGE>

mean and be a reference to such agreement , instrument or other document as
amended, amended and restated, supplemented or otherwise modified hereafter from
time to time in accordance with its terms, but solely to the extent permitted
hereunder. In this Agreement, the words "herein," "hereof" and words of similar
import refer to the entirety of this Agreement and not to any particular
Section, subsection, or Article of this Agreement.

     SECTION 1.03. Accounting Terms. All accounting terms not specifically
defined herein shall be construed in accordance with generally accepted
accounting principles consistent with those applied in the preparation of the
Consolidated financial statements of the Borrower and its Subsidiaries as at
December 31, 2001 and for the Fiscal Year then ended referred to in Section
4.01(g) ("GAAP").

                                   ARTICLE II

                        AMOUNTS AND TERMS OF THE ADVANCES
                            AND THE LETTERS OF CREDIT

     SECTION 2.01. The Advances and the Letters of Credit.
                   --------------------------------------

          (a) The Term A Advances. Each Term A Lender severally agrees, on the
     terms and conditions hereinafter set forth, to make a single advance (a
     "Term A Advance") in U.S. dollars to the Borrower at any time on or prior
     to the tenth Business Day after the Closing Date in an amount not in excess
     of the Term A Commitment of such Term A Lender at such time. The Term A
     Borrowing shall consist of Term A Advances made simultaneously by the Term
     A Lenders in accordance with their respective Pro Rata Shares of the Term A
     Facility. Amounts borrowed under this Section 2.01(a) and repaid or prepaid
     may not be reborrowed.

          (b) The Term B Advances. Each Term B Lender severally agrees, on the
     terms and conditions hereinafter set forth, to make two advances (each a
     "Term B Advance") in U.S. dollars to the Borrower, the first on the Closing
     Date and the second on the same date as the Term A Advances, in an
     aggregate amount not in excess of the Term B Commitment of such Term B
     Lender at such time. Each Term B Borrowing shall consist of Term B Advances
     made simultaneously by the Term B Lenders in accordance with their
     respective Pro Rata Shares of the Term B Facility. Amounts borrowed under
     this Section 2.01(b) and repaid or prepaid may not be reborrowed.

          (c) The Revolving Credit Advances. Each Revolving Credit Lender
     severally agrees, on the terms and conditions hereinafter set forth, to
     make advances (each a "Revolving Credit Advance") in U.S. dollars to the
     Borrower from time to time until the Termination Date, in each case in an
     amount not to exceed the Unused Revolving Credit Commitment of such
     Revolving Credit Lender at such time. Each Revolving Credit Borrowing shall
     be in an aggregate amount of $5,000,000 or an integral multiple of
     $1,000,000 in excess thereof (other than a Borrowing the proceeds of which
     shall be used solely to repay or prepay in full outstanding Swing Line
     Advances or the outstanding Letter of Credit Advances) or, if less, the
     amount of the aggregate Unused Revolving Credit Commitments at such time.
     Each Revolving Credit Borrowing shall consist of Revolving Credit Advances
     made simultaneously by the Revolving Credit Lenders in accordance with
     their respective Pro Rata Shares of the Revolving Credit Facility. Within
     the limits of each Revolving Credit Lender's Unused Revolving Credit
     Commitment in effect from time to time, the Borrower may borrow under this
     Section 2.01(c), prepay pursuant to Section 2.06(a) and reborrow under this
     Section 2.01(c).

                                       29

<PAGE>

          (d) The Swing Line Advances. The Borrower may request the Swing Line
     Bank to make, and the Swing Line Bank shall on the terms and conditions
     hereinafter set forth, make Swing Line Advances to the Borrower from time
     to time on any Business Day during the period from the Closing Date until
     the Termination Date (i) in an aggregate amount not to exceed $25,000,000
     at any time outstanding (the "Swing Line Facility") and (ii) in an amount
     for each such Swing Line Borrowing not to exceed the aggregate Unused
     Revolving Credit Commitments of the Revolving Credit Lenders at such time.
     No Swing Line Advance shall be used for the purpose of funding the payment
     of principal of any other Swing Line Advance. Each Swing Line Borrowing
     shall be in an amount of $500,000 or an integral multiple of $250,000 in
     excess thereof and shall bear interest at a rate to be agreed on by the
     Borrower and the Swing Line Bank. Within the limits of the first sentence
     of this Section 2.01(d), the Borrower may borrow under this Section
     2.01(d), repay pursuant to Section 2.04(c), prepay pursuant to Section
     2.06(a) and reborrow under this Section 2.01(d).

          (e) Letters of Credit.

               (i) The Borrower, the Existing Issuing Bank and each of the
          Revolving Credit Lenders hereby agree that each of the Existing
          Letters of Credit shall, on and after the Closing Date, be deemed for
          all purposes of this Agreement to be a Letter of Credit issued and
          outstanding under the terms of this Agreement. Each Issuing Bank
          agrees, on the terms and conditions hereinafter set forth, to issue
          letters of credit (the "Letters of Credit") in U.S. dollars for the
          account of the Borrower from time to time on any Business Day during
          the period from the date hereof until five Business Days before the
          Termination Date (A) in an Available Amount for each such Letter of
          Credit not to exceed at any time the Unused Revolving Credit
          Commitment of such Issuing Bank at such time and (B) in an aggregate
          Available Amount for all Letters of Credit not to exceed the lesser of
          (1) the Letter of Credit Facility at such time and (2) the aggregate
          Unused Revolving Credit Commitments at such time. No Letter of Credit
          shall have an expiration date (including all rights of the Borrower or
          the beneficiary of such Letter of Credit to require renewal) later
          than the earlier of (x) five Business Days prior to the Termination
          Date and (y) one year after the date of issuance thereof, but any such
          Letter of Credit may by its terms be renewable annually on the terms
          set forth in clause (ii) of this Section 2.01(e). Within the limits of
          the Letter of Credit Facility, and subject to the limits referred to
          above, the Borrower may request the issuance of Letters of Credit
          under this Section 2.01(e)(i), repay any Letter of Credit Advances
          resulting from drawings thereunder pursuant to Section 2.03(c) and
          request the issuance of additional Letters of Credit under this
          Section 2.01(e)(i).

               (ii) Each Letter of Credit may by its terms be renewable annually
          upon notice (a "Notice of Renewal") given to the Issuing Bank and the
          Administrative Agent on or prior to any date for notice of renewal set
          forth in such Letter of Credit but in any event at least three
          Business Days prior to the date of the proposed renewal of such Letter
          of Credit and upon fulfillment of the applicable conditions set forth
          in Article III unless such Issuing Bank has notified the Borrower
          (with a copy to the Administrative Agent) on or prior to the date for
          notice of termination set forth in such Letter of Credit but in any
          event at least 30 Business Days prior to the date of automatic renewal
          of its election not to renew such Letter of Credit (a "Notice of
          Termination"); provided that the terms of each Letter of Credit that
          is automatically renewable annually (A) shall require the Issuing Bank
          to give the beneficiary of such Letter of Credit notice of any Notice
          of Termination, (B) shall permit such beneficiary, upon receipt of
          such notice, to draw under such Letter of Credit prior to the date
          such Letter of Credit otherwise would have been

                                       30

<PAGE>

          automatically renewed and (C) shall not permit the expiration date
          (after giving effect to any renewal) of such Letter of Credit in any
          event to be extended to a date later than five Business Days prior to
          the Termination Date. If either a Notice of Renewal is not given by
          the Borrower or a Notice of Termination is given by the Issuing Bank
          pursuant to the immediately preceding sentence, such Letter of Credit
          shall expire on the date on which it otherwise would have been
          automatically renewed; provided, however, that in the absence of
          receipt of a Notice of Renewal the Issuing Bank may in its discretion,
          unless instructed to the contrary by the Administrative Agent or the
          Borrower deem that a Notice of Renewal had been timely delivered and,
          in such case, a Notice of Renewal shall be deemed to have been so
          delivered for all purposes under this Agreement.

     SECTION 2.02. Making the Advances.
                   -------------------

          (a) Except as otherwise provided in Section 2.02(b) or 2.03, each
     Borrowing (other than a Swing Line Borrowing) shall be made on notice,
     given not later than 2:00 P.M. (New York, New York time) on the third
     Business Day prior to the date of the proposed Borrowing in the case of a
     Borrowing comprised of Eurodollar Rate Advances, or on the first Business
     Day prior to the date of the proposed Borrowing in the case of a Borrowing
     comprised of Base Rate Advances, by the Borrower to the Administrative
     Agent, which shall give prompt notice thereof to each Appropriate Lender.
     Each notice of a Borrowing (a "Notice of Borrowing") shall be by telephone,
     confirmed immediately in writing, or by telecopier, in substantially the
     form of Exhibit B-1 hereto, shall be duly executed by a Responsible Officer
     of the Borrower, and shall specify therein: (i) the requested date of such
     Borrowing (which shall be a Business Day); (ii) the Facility under which
     such Borrowing is requested to be made; (iii) the Type of Advances
     requested to comprise such Borrowing; (iv) the requested aggregate amount
     of such Borrowing; and (v) in the case of a Borrowing comprised of
     Eurodollar Rate Advances, the requested duration of the initial Interest
     Period for each such Advance. Each Appropriate Lender shall, before 2:00
     P.M. (New York, New York time) on the date of such Borrowing, make
     available for the account of its Applicable Lending Office to the
     Administrative Agent at the Administrative Agent's Account, in same day
     funds, such Lender's Pro Rata Share of such Borrowing. After the
     Administrative Agent's receipt of such funds and upon fulfillment of the
     applicable conditions set forth in Article III, the Administrative Agent
     will make such funds available to the Borrower by crediting the Borrower's
     Account; provided, however, that, in the case of any Revolving Credit
     Borrowing, the Administrative Agent shall first make a portion of such
     funds equal to the aggregate principal amount of any Swing Line Advances
     and Letter of Credit Advances made by the Swing Line Bank or the Issuing
     Bank, as the case may be, and by any Revolving Credit Lender and
     outstanding on the date of such Revolving Credit Borrowing, plus accrued
     and unpaid interest thereon to and as of such date, available to the Swing
     Line Bank or the Issuing Bank, as applicable, and such other Revolving
     Credit Lenders for repayment of such Swing Line Advances and Letter of
     Credit Advances.

          (b) (i) Each Swing Line Borrowing shall be made on notice, given not
     later than 2:00 P.M. (New York, New York time) on the date of the proposed
     Swing Line Borrowing, by the Borrower to the Swing Line Bank and the
     Administrative Agent. Each notice of a Swing Line Borrowing (a "Notice of
     Swing Line Borrowing") shall be by telephone, confirmed immediately in
     writing, or telecopier, shall be in substantially the form of Exhibit B-2
     hereto and duly executed by a Responsible Officer of the Borrower, and
     shall specify therein: (A) the requested date of such Borrowing (which
     shall be a Business Day); (B) the requested amount of such Borrowing; and
     (C) the requested maturity of such Borrowing (which maturity shall be no
     later than the seventh day after the requested date of such Borrowing).
     Upon fulfillment of the applicable conditions set

                                       31

<PAGE>

     forth in Article III, the Swing Line Bank will make the amount thereof
     available for the account of its Applicable Lending Office to the Borrower
     by crediting the Borrower's Account.

               (ii) Upon demand by the Swing Line Bank, with a copy of such
          demand to the Administrative Agent (which shall give prompt notice
          thereof to each Revolving Credit Lender), each Revolving Credit Lender
          shall purchase from the Swing Line Bank, and the Swing Line Bank shall
          sell and assign to each such Revolving Credit Lender, such Revolving
          Credit Lender's Pro Rata Share of such outstanding Swing Line
          Borrowing as of the date of such demand, by making available for the
          account of its Applicable Lending Office to the Administrative Agent
          at the Administrative Agent's Account for the account of the Swing
          Line Bank, in same day funds, an amount equal to such Pro Rata Share.
          Promptly after receipt of such funds, the Administrative Agent shall
          transfer such funds to the Swing Line Bank at its Applicable Lending
          Office. Each Revolving Credit Lender hereby agrees to purchase its Pro
          Rata Share of an outstanding Swing Line Borrowing on (A) the Business
          Day on which demand therefor is made by the Swing Line Bank so long as
          notice of such demand is given not later than 12:00 Noon (New York,
          New York time) on such Business Day or (B) the first Business Day next
          succeeding such demand if notice of such demand is given after such
          time. The Borrower hereby agrees to each such sale and assignment.
          Upon any such assignment by the Swing Line Bank to any Revolving
          Credit Lender of a portion of a Swing Line Borrowing, the Swing Line
          Bank represents and warrants to such Revolving Credit Lender that the
          Swing Line Bank is the legal and beneficial owner of such interest
          being assigned by it, but makes no other representation or warranty
          and assumes no responsibility with respect to such Swing Line
          Borrowing, the Loan Documents or any Loan Party. If and to the extent
          that any Revolving Credit Lender shall not have so made its Pro Rata
          Share of any applicable Swing Line Borrowing available to the
          Administrative Agent in accordance with the foregoing provisions of
          this Section 2.02(b)(ii), such Revolving Credit Lender hereby agrees
          to pay to the Administrative Agent forthwith on demand the amount of
          its Pro Rata Share, together with interest thereon, for each day from
          the date of demand by the Swing Line Bank therefor until the date such
          amount is paid to the Administrative Agent, at the Federal Funds Rate.
          If such Lender shall pay to the Administrative Agent the amount of its
          Pro Rata Share for the account of the Swing Line Bank on any Business
          Day, such amount so paid in respect of principal shall constitute a
          Swing Line Advance made by such Lender on such Business Day for all
          purposes of this Agreement, and the outstanding principal amount of
          the Swing Line Advance made by the Swing Line Bank shall be reduced by
          such amount on such Business Day.

               (iii) The obligation of each Revolving Credit Lender to purchase
          its Pro Rata Share of each outstanding Swing Line Borrowing upon
          demand by the Swing Line Bank therefor pursuant to clause (ii) of this
          Section 2.02(b) shall be absolute, unconditional and irrevocable, and
          shall be made strictly in accordance with the terms of clause (ii) of
          this Section 2.02(b) under all circumstances, including, without
          limitation, the following circumstances:

                    (A) any lack of validity or enforceability of any Loan
               Document or any other agreement or instrument relating thereto;

                    (B) the existence of any claim, set-off, defense or other
               right that such Revolving Credit Lender may have at any time
               against the Swing Line

                                       32

<PAGE>

               Bank, the Borrower or any other Person, whether in connection
               with the transactions contemplated by the Loan Documents or any
               unrelated transaction;

                    (C) the occurrence and continuance of any Default or Event
               of Default; or

                    (D) any other circumstance or happening whatsoever, whether
               or not similar to any of the foregoing.

          (c) Anything in subsection (a) of this Section 2.02 to the contrary
     notwithstanding, (i) the Borrower may not select Eurodollar Rate Advances
     if the obligation of the Appropriate Lenders to make Eurodollar Rate
     Advances shall then be suspended pursuant to Section 2.09 or 2.10. In
     addition, the Term Advances may not be outstanding as part of more than 10
     separate Borrowings and the Revolving Credit Advances may not be
     outstanding as part of more than 10 separate Borrowings.

          (d) Each Notice of Borrowing and Notice of Swing Line Borrowing shall
     be irrevocable and binding on the Borrower. In the case of any Borrowing
     that the related Notice of Borrowing specifies is to be comprised of
     Eurodollar Rate Advances, the Borrower shall indemnify each Appropriate
     Lender against any loss, cost or expense incurred by such Lender as a
     result of any failure to fulfill on or before the date specified in such
     Notice of Borrowing for such Borrowing the applicable conditions set forth
     in Article III, including, without limitation, any loss, cost or expense
     incurred by reason of the liquidation or reemployment of deposits or other
     funds acquired by such Lender to fund the Eurodollar Rate Advance to be
     made by such Lender as part of such Borrowing when such Advance, as a
     result of such failure, is not made on such date. A certificate of the
     Lender requesting compensation pursuant to this subsection (d) submitted to
     the Borrower by such Lender and specifying therein the amount of such
     additional compensation (including the basis of calculation thereof) shall
     be conclusive and binding for all purposes, absent manifest error.

          (e) Unless the Administrative Agent shall have received notice from an
     Appropriate Lender prior to the date of any Borrowing under a Facility
     under which such Lender has a Commitment that such Lender will not make
     available to the Administrative Agent such Lender's Pro Rata Share of such
     Borrowing, the Administrative Agent may assume that such Lender has made
     the amount of such Pro Rata Share available to the Administrative Agent on
     the date of such Borrowing in accordance with subsection (a) or (b) of this
     Section 2.02, as applicable, and the Administrative Agent may, in reliance
     upon such assumption, make available to the Borrower on such date a
     corresponding amount. If and to the extent that such Lender shall not have
     so made the amount of such Pro Rata Share available to the Administrative
     Agent, such Lender and the Borrower severally agree to repay or to pay to
     the Administrative Agent forthwith on demand such corresponding amount,
     together with interest thereon, for each day from the date such amount is
     made available to the Borrower until the date such amount is repaid or paid
     to the Administrative Agent, at (i) in the case of the Borrower, the
     interest rate applicable at such time under Section 2.07 to Advances
     comprising such Borrowing and (ii) in the case of such Lender, the Federal
     Funds Rate. If such Lender shall pay to the Administrative Agent such
     corresponding amount, such amount so paid shall constitute such Lender's
     Advance as part of such Borrowing for all purposes under this Agreement.

          (f) The failure of any Lender to make the Advance to be made by it as
     part of any Borrowing shall not relieve any other Lender of its obligation,
     if any, hereunder to make its Advance on the date of such Borrowing, but no
     Lender shall be responsible for the failure of any

                                       33

<PAGE>

     other Lender to make the Advance to be made by such other Lender on the
     date of any Borrowing.

     SECTION 2.03. Issuance of and Drawings and Reimbursement Under Letters of
                   Credit.
                   -----------------------------------------------------------

          (a) Request for Issuance. Each Letter of Credit shall be issued upon
     notice, given not later than 2:00 P.M. (New York, New York time) on the
     fifth Business Day prior to the date of the proposed issuance of such
     Letter of Credit (or such later day as the Issuing Bank in its sole
     discretion shall agree), by the Borrower to the Issuing Bank, which shall
     give to the Administrative Agent and each Revolving Credit Lender prompt
     notice thereof. Each notice of issuance of a Letter of Credit (a "Notice of
     Issuance") shall be by telephone, confirmed immediately in writing, or by
     telecopier, shall be duly executed by a Responsible Officer of the
     Borrower, and shall specify therein: (i) the requested date of such
     issuance (which shall be a Business Day); (ii) the requested Available
     Amount of such Letter of Credit; (iii) the requested expiration date of
     such Letter of Credit (which shall comply with the requirements of Section
     2.01(e)); (iv) the name and address of the proposed beneficiary of such
     Letter of Credit; and (v) the proposed form of such Letter of Credit, and
     shall be accompanied by such application and agreement for letters of
     credit as the Issuing Bank may specify to the Borrower for use in
     connection with such requested Letter of Credit (such applications and
     agreements, and all similar agreements entered into in connection with an
     Existing Letter of Credit, a "Letter of Credit Agreement"). If the
     requested form of such Letter of Credit is acceptable to the Issuing Bank
     in its sole discretion, the Issuing Bank will, upon fulfillment of the
     applicable conditions set forth in Article III, make such Letter of Credit
     available to the Borrower at its office referred to in Section 8.02 or as
     otherwise agreed with the Borrower in connection with the issuance of such
     Letter of Credit. If and to the extent that the provisions of any Letter of
     Credit Agreement shall conflict with this Agreement, the provisions of this
     Agreement shall govern.

          (b) Drawing and Reimbursement.

               (i) The obligation of the Borrower to reimburse the Issuing Bank
          for each payment made by the Issuing Bank under any Letter of Credit,
          and to pay interest thereon as provided herein, shall be absolute,
          unconditional and irrevocable, without regard to any circumstances,
          including, without limitation, those referred to in Section 2.04(d)
          below. The payment by the Issuing Bank of a draft drawn under any
          Letter of Credit shall constitute for all purposes of this Agreement
          the making by the Issuing Bank of a Letter of Credit Advance, which
          shall be a Base Rate Advance, in the amount of such draft; provided
          that such payment shall not be deemed a Base Rate Advance if the
          Borrower reimburses the Issuing Bank therefor prior to 2:00 P.M. (New
          York, New York time) on the date of such payment, or if such payment
          by the Issuing Bank is made on or after 2:00 P.M. (New York, New York
          time), then prior to 2:00 P.M. (New York, New York time), on the
          Business Day immediately succeeding the date of such payment, together
          with interest thereon from the date of such payment to the date of
          such reimbursement at a rate per annum equal to the sum of the Base
          Rate then in effect from time to time and the Applicable Margin for
          Base Rate Advances that are Revolving Credit Advances then in effect
          from time to time. Upon demand by the Issuing Bank, with a copy of
          such demand to the Administrative Agent (which shall give prompt
          notice thereof to each Revolving Credit Lender), each Revolving Credit
          Lender shall purchase from the Issuing Bank, and the Issuing Bank
          shall sell and assign to each such Revolving Credit Lender, such
          Lender's Pro Rata Share of such outstanding Letter of Credit Advance
          as of the date of such purchase, by making available for the account
          of its Applicable Lending Office to the Administrative Agent for the
          account of the Issuing

                                       34

<PAGE>

          Bank, at the Administrative Agent's Account, in same day funds, an
          amount equal to the portion of the outstanding principal amount of
          such Letter of Credit Advance to be purchased by such Lender. Promptly
          after receipt thereof, the Administrative Agent shall transfer such
          funds to the Issuing Bank. The Borrower hereby agrees to each such
          sale and assignment. Each Revolving Credit Lender agrees to purchase
          its Pro Rata Share of an outstanding Letter of Credit Advance on (A)
          the Business Day on which demand therefor is made by the Issuing Bank
          so long as notice of such demand is given not later than 2:00 P.M.
          (New York, New York time) on such Business Day or (B) the first
          Business Day next succeeding such demand if notice of such demand is
          given after such time. Upon any such assignment by the Issuing Bank to
          any other Revolving Credit Lender of a portion of a Letter of Credit
          Advance, the Issuing Bank represents and warrants to such other Lender
          that the Issuing Bank is the legal and beneficial owner of such
          interest being assigned by it, free and clear of any liens, but makes
          no other representation or warranty and assumes no responsibility with
          respect to such Letter of Credit Advance, the Loan Documents or any
          Loan Party. If and to the extent that any Revolving Credit Lender
          shall not have so made the amount of such Letter of Credit Advance
          available to the Administrative Agent, such Revolving Credit Lender
          agrees to pay to the Administrative Agent forthwith on demand such
          amount, together with interest thereon, for each day from the date of
          demand by the Issuing Bank until the date such amount is paid to the
          Administrative Agent, at the Federal Funds Rate, for its account or
          the account of the Issuing Bank, as applicable. If such Revolving
          Credit Lender shall pay to the Administrative Agent such amount for
          the account of the Issuing Bank on any Business Day, such amount so
          paid in respect of principal shall constitute a Letter of Credit
          Advance made by such Revolving Credit Lender on such Business Day for
          all purposes of this Agreement, and the outstanding principal amount
          of the Letter of Credit Advance made by the Issuing Bank shall be
          reduced by such amount on such Business Day.

               (ii) The Obligation of each Revolving Credit Lender to purchase
          its Pro Rata Share of each outstanding Letter of Credit Advance upon
          demand by the Issuing Bank therefor pursuant to clause (i) of this
          Section 2.03(b) shall be absolute, unconditional and irrevocable, and
          shall be made strictly in accordance with the terms of clause (i) of
          this Section 2.03(b) under all circumstances, including, without
          limitation, the following circumstances:

                    (A) any lack of validity or enforceability of any Loan
               Document, any Letter of Credit Agreement, any Letter of Credit or
               any other agreement or instrument relating thereto (collectively,
               the "L/C Related Documents");

                    (B) the existence of any claim, set-off, defense or other
               right that such Revolving Credit Lender may have at any time
               against any beneficiary or any transferee of a Letter of Credit
               (or any Person for whom any such beneficiary or any such
               transferee may be acting), the Issuing Bank, the Borrower or any
               other Person, whether in connection with the transactions
               contemplated by the L/C Related Documents or any unrelated
               transaction;

                    (C) the occurrence and continuance of any Default or Event
               of Default; or

                    (D) any other circumstance or happening whatsoever, whether
               or not similar to any of the foregoing.

                                       35

<PAGE>

          (c) Failure to Make Letter of Credit Advances. The failure of any
     Revolving Credit Lender to make the Letter of Credit Advance to be made by
     it on the date specified in Section 2.03(b) shall not relieve any other
     Revolving Credit Lender of its obligation hereunder to make its Letter of
     Credit Advance on such date, but no Revolving Credit Lender shall be
     responsible for the failure of any other Revolving Credit Lender to make
     the Letter of Credit Advance to be made by such other Revolving Credit
     Lender on such date.

     SECTION 2.04. Repayment of Advances.
                   ---------------------

          (a)  Term Advances.

               (i) The Borrower shall repay to the Administrative Agent for the
          ratable account of the Appropriate Lenders the aggregate principal
          amount of all Term Advances outstanding on the following dates in the
          respective amounts set forth opposite such dates (which amounts shall
          be reduced as a result of the application of prepayments in accordance
          with the order of priority set forth in Section 2.06):

================================== =============================================
              DATE                                      AMOUNT
---------------------------------- ---------------------- ----------------------
                                      Term A Facility          Term B Facility
---------------------------------- ---------------------- ----------------------
June 30, 2002                           $5,625,000                $2,125,000
---------------------------------- ---------------------- ----------------------
September 30, 2002                      $5,625,000                $2,125,000
---------------------------------- ---------------------- ----------------------
December 31, 2002                       $5,625,000                $2,125,000
---------------------------------- ---------------------- ----------------------
March 31, 2003                          $5,625,000                $2,125,000
---------------------------------- ---------------------- ----------------------
June 30, 2003                           $7,500,000                $2,125,000
---------------------------------- ---------------------- ----------------------
September 30, 2003                      $7,500,000                $2,125,000
---------------------------------- ---------------------- ----------------------
December 31, 2003                       $7,500,000                $2,125,000
---------------------------------- ---------------------- ----------------------
March 31, 2004                          $7,500,000                $2,125,000
---------------------------------- ---------------------- ----------------------
June 30, 2004                           $7,500,000                $2,125,000
---------------------------------- ---------------------- ----------------------
September 30, 2004                      $7,500,000                $2,125,000
---------------------------------- ---------------------- ----------------------
December 31, 2004                       $7,500,000                $2,125,000
---------------------------------- ---------------------- ----------------------
March 31, 2005                          $7,500,000                $2,125,000
---------------------------------- ---------------------- ----------------------
June 30, 2005                           $7,500,000                $2,125,000
---------------------------------- ---------------------- ----------------------
September 30, 2005                      $7,500,000                $2,125,000
---------------------------------- ---------------------- ----------------------
December 31, 2005                       $7,500,000                $2,125,000
---------------------------------- ---------------------- ----------------------
March 31, 2006                          $7,500,000                $2,125,000
---------------------------------- ---------------------- ----------------------
June 30, 2006                           $9,375,000                $2,125,000
---------------------------------- ---------------------- ----------------------
September 30, 2006                      $9,375,000                $2,125,000
---------------------------------- ---------------------- ----------------------
December 31, 2006                       $9,375,000                $2,125,000
---------------------------------- ---------------------- ----------------------
March 31, 2007                          $9,375,000                $2,125,000
---------------------------------- ---------------------- ----------------------
June 30, 2007                                                    $100,937,500
---------------------------------- ---------------------- ----------------------
September 30, 2007                                               $100,937,500
---------------------------------- ---------------------- ----------------------
December 31, 2007                                                $100,937,500
---------------------------------- ---------------------- ----------------------
March 31, 2008                                                   $100,937,500
---------------------------------- ---------------------- ----------------------
June 30, 2008                                                    $100,937,500
---------------------------------- ---------------------- ----------------------
September 30, 2008                                               $100,937,500
---------------------------------- ---------------------- ----------------------
December 31, 2008                                                $100,937,500
---------------------------------- ---------------------- ----------------------
March 31, 2009                                                   $100,937,500
================================== ====================== ======================

                                       36

<PAGE>

          provided, however, that the final principal installment of the
          respective Term Advances shall be in an amount equal to the aggregate
          principal amount of all such Term Advances then outstanding.

          (b) Revolving Credit Advances. The Borrower shall repay to the
     Administrative Agent for the ratable account of the Revolving Credit
     Lenders on the Termination Date the aggregate principal amount of all
     Revolving Credit Advances outstanding on such date.

          (c) Swing Line Advances. The Borrower shall repay to the
     Administrative Agent for the account of the Swing Line Bank and each
     Revolving Credit Lender that has made a Swing Line Advance on the earlier
     of (i) the maturity date for each Swing Line Advance (as specified in the
     applicable Notice of Swing Line Borrowing (which maturity shall be no later
     than the seventh day after the date on which such Swing Line Borrowing was
     initially made by the Swing Line Bank) and (ii) the Termination Date, the
     principal amount of each such Swing Line Advance made by the Swing Line
     Bank and each such Revolving Credit Lender and outstanding on such date.

          (d) Letter of Credit Advances.

               (i) The Borrower shall repay to the Administrative Agent for the
          account of the Issuing Bank and each Revolving Credit Lender that has
          made a Letter of Credit Advance on the earlier of (A) the date of
          demand therefor and (B) the Termination Date, the principal amount of
          each such Letter of Credit Advance made by the Issuing Bank and each
          such Revolving Credit Lender and outstanding on such date.

               (ii) The Obligations of the Borrower under this Agreement, any
          Letter of Credit Agreement and any other agreement or instrument
          relating to any Letter of Credit shall be absolute, unconditional and
          irrevocable, and shall be paid strictly in accordance with the terms
          of this Agreement, such Letter of Credit Agreement or such other
          agreement or instrument under all circumstances, including, without
          limitation, the following circumstances (it being understood that any
          such payment by the Borrower is without prejudice to, and does not
          constitute a waiver of, any rights the Borrower might have or might
          acquire as a result of the payment by the Issuing Bank of any draft
          drawn or the reimbursement by the Borrower thereof):

                    (A) any lack of validity or enforceability of any L/C
               Related Document;

                    (B) any change in the time, manner or place of payment of,
               or in any other term of, all or any of the Obligations of the
               Borrower in respect of any L/C Related Document or any other
               amendment or waiver of or any consent to departure from all or
               any of the L/C Related Documents;

                    (C) the existence of any claim, set-off, defense or other
               right that the Borrower may have at any time against any
               beneficiary or any transferee of a Letter of Credit (or any
               Person for whom any such beneficiary or any such transferee may
               be acting), the Issuing Bank or any other Person, whether in
               connection with the transactions contemplated by the L/C Related
               Documents or any unrelated transaction;

                                       37

<PAGE>

                    (D) any statement or any other document presented under a
               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;

                    (E) payment by the Issuing Bank under a Letter of Credit
               against presentation of a draft, certificate or other document
               that does not strictly comply with the terms of such Letter of
               Credit;

                    (F) any exchange, release or nonperfection of any Collateral
               or other collateral, or any release or amendment or waiver of or
               consent to departure from the Subsidiary Guarantee or any other
               guarantee, for all or any of the Obligations of the Borrower in
               respect of the L/C Related Documents; or

                    (G) any other circumstance or happening whatsoever, whether
               or not similar to any of the foregoing, including, without
               limitation, any other circumstance that might otherwise
               constitute a defense available to, or a discharge of, the
               Borrower or a guarantor.

     SECTION 2.05. Termination or Reduction of the Commitments.
                   -------------------------------------------

          (a) Optional. The Borrower may, upon at least three Business Days'
     notice to the Administrative Agent, terminate in whole or reduce in part
     the unused portions of the Letter of Credit Facility, the Unused Revolving
     Credit Commitments or the unused portions of the Term A Facility or the
     Term B Facility; provided, however, that each partial reduction of a
     Facility shall be in an aggregate amount of $5,000,000 or an integral
     multiple of $1,000,000 in excess thereof or, if less, the aggregate amount
     of such Facility.

          (b) Mandatory.

               (i) The Revolving Credit Facility shall be automatically and
          permanently reduced on each date on which the prepayment of Revolving
          Credit Advances outstanding thereunder is required to be made pursuant
          to Section 2.06(b)(i) by an amount equal to the applicable Reduction
          Amount.

               (ii) The Swing Line Facility shall be automatically and
          permanently reduced on the date of each reduction in the Revolving
          Credit Facility by the amount, if any, by which the amount of the
          Swing Line Facility on such date exceeds the amount of the Revolving
          Credit Facility on such date (after giving effect to such reduction of
          the Revolving Credit Facility on such date).

               (iii) The Letter of Credit Facility shall be automatically and
          permanently reduced on the date of each reduction in the Revolving
          Credit Facility by an amount equal to the amount, if any, by which (A)
          the Letter of Credit Facility on such date exceeds (B) the Revolving
          Credit Facility on such date, after giving effect to such reduction of
          the Revolving Credit Facility.

               (iv) The Term A Facility shall be automatically and permanently
          reduced on the date of the Term A Advances to the amount equal to the
          aggregate amount of all Term A Advances made on such date.

                                       38

<PAGE>

               (v) The Term B Facility shall be automatically and permanently
          reduced on the date of the second Term B Advances to the amount equal
          to the aggregate amount of all Term B Advances theretofore made,
          including the Term B Advances made on such date.

          (c) Application of Commitment Reductions. Upon each reduction of a
     Facility pursuant to this Section 2.05, the Commitment of each Appropriate
     Lender under such Facility shall be reduced by such Lender's Pro Rata Share
     of the amount by which such Facility is reduced.

     SECTION 2.06. Prepayments.
                   -----------

          (a) Optional. The Borrower may, (i) on any Business Day, prepay all or
     any portions of any Swing Line Advance and (ii) upon at least three
     Business Days' notice to the Administrative Agent for a Eurodollar Rate
     Advance or upon at least one Business Days' notice to the Administrative
     Agent for a Base Rate Advance, in each case, stating the Facility under
     which Advances are proposed to be prepaid and the proposed date and
     aggregate principal amount of the prepayment, and if such notice is given
     the Borrower shall, prepay the aggregate principal amount of the Advances
     comprising part of the same Borrowing and outstanding on such date, in
     whole or ratably in part; provided, however, that each partial prepayment
     of (i) Revolving Credit Advances shall be in an aggregate principal amount
     of $1,000,000 or an integral multiple of $250,000 in excess thereof and
     (ii) Term Advances shall be in an aggregate principal amount of $5,000,000
     or an integral multiple of $500,000 in excess thereof or, if less, the
     aggregate outstanding principal amount of such Facility. Each prepayment of
     Term Advances made pursuant to this clause (a) shall be applied against the
     principal repayment installments of the respective Term Facility designated
     by the Borrower in the respective notice of prepayment.

          (b) Mandatory.

               (i) The Borrower shall, not later than three Business Days after
          the date of receipt of the Net Cash Proceeds by the Borrower or any of
          its Subsidiaries from:

                    (A) the sale, lease, transfer or other disposition of any
               property or assets of the Borrower or any of its Subsidiaries
               (other than any property or assets expressly permitted to be
               sold, leased, transferred or otherwise disposed of pursuant to
               clause (i), (ii), (iii), (iv) or (v) of Section 5.02(e));

                    (B) the incurrence or issuance by the Borrower or any of its
               Subsidiaries of any Debt (other than Debt expressly permitted to
               be incurred or issued pursuant to clause (i), (iii), (iv), (v),
               (vi), (vii), (viii), (ix), (x), (xi) or (xiii) of Section
               5.02(b)); and

                    (C) the issuance or sale by the Borrower or any Subsidiary
               thereof (which is or will be as a result thereof subject to the
               Securities Exchange Act of 1934, as amended) of any Equity
               Interests therein (other than (i) the issuance by the Borrower of
               (a) its common stock pursuant to equity incentive or benefit
               plans of the Borrower, (b) Equity Interests to effect any
               acquisition permitted under Section 5.02(f) hereof, provided that
               in the case in which the proceeds of such issuance are
               contemplated to be used to effect such acquisition, then all the
               proceeds thereof are used within 180 days of such issuance to
               effect such acquisition, and any such proceeds not so used by
               such 180th day shall be applied

                                       39

<PAGE>

               as a prepayment as provided herein, or (c) Equity Interests in
               connection with a redemption of Subordinated Debt to the extent
               contemplated in Section 5.02(i) and, (ii) the issuance by any
               Subsidiary of the Borrower of any Equity Interests therein (a) to
               the Borrower or to another Subsidiary thereof, or (b) to any
               other Person or Persons in an aggregate amount in any one
               transaction or series of related transactions not in excess of
               $10,000,000),

          prepay an aggregate principal amount of the Advances comprising part
          of the same Borrowings equal to (x) 100% of the amount of the Net Cash
          Proceeds in respect of any sale, lease, transfer or other disposition
          of any property or assets of the Borrower or any of its Subsidiaries
          referred to in subclause (b)(i)(A) above to the extent such Net Cash
          Proceeds have not been reinvested within the applicable reinvestment
          period as provided in Section 5.02(e)(vi); (y) the first $200,000,000
          of Net Cash Proceeds from the incurrence or issuance by the Borrower
          or any of its Subsidiaries of all Debt referred to in subclause
          (b)(i)(B) above plus 50% of any such Net Cash Proceeds in excess of
          $200,000,000; and (z) 50% of the amount of the Net Cash Proceeds of
          the issuance or sale by the Borrower of any Equity Interests referred
          to in subclause (b)(i)(C), and in the case of Net Cash Proceeds from
          the issuance or sale by any Subsidiary of the Borrower of Equity
          Interests referred to in subclause (b)(i)(C) above, 50% of an amount
          equal to the Borrower's Percentage of such Net Cash Proceeds; provided
          however, that prepayments of Net Cash Proceeds from the issuance or
          sale by the Borrower or any Subsidiary of the Borrower of Equity
          Interests referred to in subclause (b)(i)(C) above shall not be
          required if, after giving pro forma effect to such issuance or sale,
          the Borrower has a Leverage Ratio of less than 2.75:1.00. Each
          prepayment of advances required to be made pursuant to this subclause
          (i) shall first be applied on a pro rata basis between the Term
          Facilities, and with respect to each Term Facility, applied on a pro
          rata basis against the respective principal repayment installments
          thereof, and thereafter applied to the Revolving Credit Facility in
          the manner set forth in this Section 2.06(b).

               (ii) The Borrower shall, on each Business Day, prepay an
          aggregate principal amount of the Revolving Credit Advances comprising
          part of the same Borrowings, the Letter of Credit Advances and the
          Swing Line Advances and, if applicable, deposit an amount into the L/C
          Cash Collateral Account equal to the amount by which (A) the sum of
          (1) the aggregate principal amount of all Revolving Credit Advances,
          Letter of Credit Advances and Swing Line Advances outstanding on such
          Business Day and (2) the aggregate Available Amount of all Letters of
          Credit outstanding on such Business Day exceeds (B) the Revolving
          Credit Facility on such Business Day (after giving effect to any
          permanent reduction thereof pursuant to Section 2.05 on such Business
          Day).

               (iii) The Borrower shall, on each Business Day, pay to the
          Administrative Agent for deposit into the L/C Cash Collateral Account
          an amount sufficient to cause the aggregate amount on deposit in the
          L/C Cash Collateral Account on such Business Day to equal the amount
          by which (A) the aggregate Available Amount of all Letters of Credit
          outstanding on such Business Day exceeds (B) the Letter of Credit
          Facility on such Business Day (after giving effect to any permanent
          reduction thereof pursuant to Section 2.05 on such Business Day).

               (iv) Prepayments of the Revolving Credit Facility made pursuant
          to clause (i), (ii) or (iii) of this Section 2.06(b), first, shall be
          applied to prepay Letter of Credit Advances outstanding at such time
          until all such Letter of Credit Advances are paid in full, second,
          shall be applied to prepay Swing Line Advances outstanding at such
          time

                                       40

<PAGE>

          until all such Swing Line Advances are paid in full, third, shall be
          applied to prepay Revolving Credit Advances comprising part of the
          same Borrowings and outstanding at such time until all such Revolving
          Credit Advances are paid in full and, fourth, shall be deposited into
          the L/C Cash Collateral Account to cash collateralize 100% of the
          Available Amount of all Letters of Credit outstanding at such time;
          and, in the case of prepayments of the Revolving Credit Facility
          required pursuant to clause (i) or (ii) of this Section 2.06(b), the
          amount remaining, if any, after the prepayment in full of all Advances
          outstanding at such time and the 100% cash collateralization of the
          aggregate Available Amount of all Letters of Credit outstanding at
          such time (the sum of such prepayment amounts, cash collateralization
          amounts and remaining amount being, collectively, the "Reduction
          Amount") may be retained by the Borrower for use in the ordinary
          course of its business, and the Letter of Credit Facility shall be
          automatically and permanently reduced as set forth in Section
          2.05(b)(iii). Upon the drawing of any Letter of Credit for which funds
          are on deposit in the L/C Cash Collateral Account, such funds shall be
          applied (without any further action by or notice to or from the
          Borrower or any other Loan Party) to reimburse the Issuing Bank or the
          Revolving Credit Lenders, as applicable.

               (c) Prepayments to Include Accrued Interest, Etc. All prepayments
          under this Section 2.06 shall be made together with (i) accrued and
          unpaid interest to the date of such prepayment on the principal amount
          so prepaid and (ii) in the case of any such prepayment of a Eurodollar
          Rate Advance on a date other than the last day of an Interest Period
          therefor, any amounts owing in respect of such Eurodollar Rate Advance
          pursuant to 8.04(c).

               (d) Term B Lender Opt-Out. Any Term B Lender may elect (upon such
          election, such Term B Lender being a "Declining Lender"), by notice to
          the Administrative Agent in writing (or by telecopy or telephone
          promptly confirmed in writing) by 12:00 p.m., New York, New York time,
          at least two Business Days prior to any prepayment of Term B Advances
          required to be made by the Borrower for the account of such Declining
          Lender pursuant to this Section 2.06(d), not to accept the portion of
          such prepayment to which such Declining Lender would be entitled and
          upon such election, such declined amount shall be applied instead to
          prepay a portion of the Term A Advances (to the extent Term A Advances
          remain outstanding after giving effect to such prepayment of the Term
          A Advances) in accordance with subsection 2.06(b)(i) above and this
          subsection 2.06(d). On the date of such prepayment (the "Prepayment
          Date"), (i) an amount equal to that portion of the prepayment required
          to be made to the Term B Lenders other than the Declining Lenders
          (such Term B Lenders being the "Accepting Lenders") shall be applied
          by the Administrative Agent on behalf of the Borrower to prepay Term B
          Advances owing to such Accepting Lenders on a pro rata basis as
          provided above, (ii) fifty percent of any amounts that would otherwise
          have been applied to prepay Advances under the Term B Facility owing
          to Declining Lenders shall instead be applied ratably to prepay the
          remaining Term A Advances owing to Term A Lenders as provided above,
          and (iii) the remaining fifty percent of such amounts shall be
          credited to the Borrower's Account; provided that on prepayment in
          full of all Term B Advances owing to Accepting Lenders and all Term A
          Advances owing to Term A Lenders, the remainder of such amounts shall
          be applied ratably to prepay Term B Advances owing to Declining
          Lenders.

     SECTION 2.07. Interest
                   --------

          (a) Scheduled Interest. The Borrower shall pay interest on the unpaid
     principal amount of each Advance owing to each Lender Party from the date
     of such Advance until such principal amount shall be paid in full, at the
     following rates per annum:

                                       41

<PAGE>

               (i) Base Rate Advances. During such periods as such Advance is a
          Base Rate Advance, a rate per annum equal at all times to the sum of
          (A) the Base Rate in effect from time to time and (B) the Applicable
          Margin for such Base Rate Advance in effect from time to time, payable
          in arrears quarterly on the last Business Day of each March, June,
          September and December during such periods and on the date such Base
          Rate Advance shall be Converted or paid in full.

               (ii) Eurodollar Rate Advances. During such periods as such
          Advance is a Eurodollar Rate Advance, a rate per annum equal at all
          times during each Interest Period for such Eurodollar Rate Advance to
          the sum of (A) the Eurodollar Rate for such Eurodollar Rate Advance
          for such Interest Period and (B) the Applicable Margin for such
          Advance in effect on the first day of such Interest Period, payable in
          arrears on the last day of such Interest Period and, if such Interest
          Period has a duration of more than three months, on each day that
          occurs during such Interest Period every three months from the first
          day of such Interest Period and on the date such Eurodollar Rate
          Advance shall be Converted or paid in full.

               (iii) Default Interest. Upon the occurrence and during the
          continuance of a Default under Section 6.01(a) or 6.01(f) or an Event
          of Default, the Administrative Agent may, and upon the request of the
          Required Lenders shall, require that the Borrower pay interest on (i)
          the unpaid principal amount of each Advance owing to each Lender
          Party, payable in arrears on the dates referred to in clause (i) or
          (ii) of Section 2.07(a), as applicable, and on demand, at a rate per
          annum equal at all times to 2% per annum above the rate per annum
          required to be paid on such Advance pursuant to clause (i) or (ii) of
          Section 2.07(a), as applicable, and (ii) to the fullest extent
          permitted by applicable law, the amount of any interest, fee or other
          amount payable under this Agreement or any other Loan Document to any
          Agent or any Lender Party that is not paid when due, from the date
          such amount shall be due until such amount shall be paid in full,
          payable in arrears on the date such amount shall be paid in full and
          on demand, at a rate per annum equal at all times to 2% per annum
          above the rate per annum required to be paid, in the case of interest,
          on the Type of Advance on which such interest has accrued pursuant to
          clause (i) or (ii) of Section 2.07(a), as applicable, and, in all
          other cases, on Base Rate Advances pursuant to clause (i) of Section
          2.07(a).

          (b) Notice of Interest Rate. Promptly after receipt of a Notice of
     Borrowing pursuant to Section 2.02(a), a Notice of Conversion pursuant to
     Section 2.09(a) or a notice of selection of an Interest Period pursuant to
     the definition of "Interest Period" set forth in Section 1.01, the
     Administrative Agent shall give notice to the Borrower and each Appropriate
     Lender of the applicable interest rate determined by the Administrative
     Agent for purposes of clause (i) or (ii) of Section 2.07(a), as applicable.

     SECTION 2.08. Fees.
                   ----

          (a) Commitment Fee.

               (i) The Borrower shall pay to the Administrative Agent for the
          account of the Revolving Credit Lenders a commitment fee (the
          "Commitment Fee"), from the date hereof in the case of each Initial
          Lender and from the effective date specified in the Assignment and
          Assumption pursuant to which it became a Revolving Credit Lender in
          the case of each other Revolving Credit Lender until, in each case,
          the Termination Date, payable in arrears on the date of the Initial
          Extension of Credit, thereafter quarterly on the

                                       42

<PAGE>

          last Business Day of each March, June, September and December,
          commencing June 30, 2002, and on the Termination Date, at the
          Applicable Percentage in effect from time to time on the sum of (i)
          the average daily Unused Revolving Credit Commitment of each Revolving
          Credit Lender plus (ii) such Revolving Credit Lender's Pro Rata Share
          of the average daily outstanding Swing Line Advances during such
          quarter; provided, however, that no Commitment Fee shall accrue on any
          of the Commitments of a Defaulting Lender so long as such Lender shall
          be a Defaulting Lender.

               (ii) The Borrower shall pay to the Administrative Agent for the
          account of the Term A Lenders a commitment fee, from the date hereof
          in the case of each Initial Lender and from the effective date
          specified in the Assignment and Assumption pursuant to which it became
          a Term A Lender in the case of each other Term A Lender until the date
          of the Term A Advances, payable on such date at the rate of 0.50% per
          annum on the amount of the respective Term A Lender's respective Term
          A Commitment.

               (iii) The Borrower shall pay to the Administrative Agent for the
          account of the Term B Lenders a commitment fee, from the date hereof
          in the case of each Initial Lender and from the effective date
          specified in the Assignment and Assumption pursuant to which it became
          a Term B Lender in the case of each other Term B Lender until the date
          of the second Term B Advance, payable on such date at the rate of
          0.50% per annum on the unused amount of the respective Term B Lender's
          respective Term B Commitment during such period.

          (b) Letter of Credit Fees, Etc.

               (i) The Borrower shall pay to the Administrative Agent for the
          account of each Revolving Credit Lender a commission, payable in
          arrears quarterly on the last Business Day of each March, June,
          September and December, commencing June 30, 2002, and on the earliest
          to occur of the full drawing, expiration, termination or cancellation
          of any such Letter of Credit and on the Termination Date, on such
          Revolving Credit Lender's Pro Rata Share of the average daily
          aggregate Available Amount of all Letters of Credit outstanding from
          time to time during such quarter at the rate per annum equal to the
          Applicable Margin in effect at such time for Eurodollar Rate Advances
          under the Revolving Credit Facility. Upon the occurrence and during
          the continuance of a Default under Section 6.01(a) or 6.01(f) or an
          Event of Default, the amount of commission payable by the Borrower
          under this clause (b)(i) shall be increased by 2% per annum.

               (ii) The Borrower shall pay to each Issuing Bank, for its own
          account, an issuing bank fee, payable in arrears quarterly on the last
          Business Day of each March, June, September and December, commencing
          June 30, 2002, and on the earliest to occur of the full drawing,
          expiration, termination or cancellation of any such Letter of Credit
          issued by such Issuing Bank and on the Termination Date, on the
          average daily aggregate Available Amount of all Letters of Credit
          issued by such Issuing Bank and outstanding from time to time during
          such quarter at the rate per annum equal to 0.25%, together with such
          commissions, transfer fees and other fees and charges in connection
          with the issuance or administration of each Letter of Credit as the
          Borrower and such Issuing Bank shall from time to time agree.

                                       43

<PAGE>

          (c) Agents' Fees. The Borrower shall pay to the Administrative Agent
     for the account of the Agents such fees as may from time to time be agreed
     between the Borrower and the Administrative Agent.

     SECTION 2.09. Conversion of Advances.
                   ----------------------

          (a) Optional. The Borrower may on any Business Day, upon notice given
     to the Administrative Agent not later than (i) 2:00 P.M. (New York, New
     York time) on the third Business Day prior to the date of the proposed
     Conversion in the case of a Conversion of Base Rate Advances into
     Eurodollar Rate Advances or of Eurodollar Rate Advances of one Interest
     Period into Eurodollar Rate Advances of another Interest Period, or (ii)
     2:00 P.M. (New York, New York time) on the Business Day immediately
     preceding the date of the proposed Conversion in the case of a Conversion
     of Eurodollar Rate Advances into Base Rate Advances; provided, however,
     that in each case:

               (A) any Conversion of Base Rate Advances into Eurodollar Rate
          Advances shall be made only if no Default under Section 6.01(f) or
          Event of Default shall have occurred and be continuing and shall be in
          an amount not less than the minimum amount specified in Section
          2.01(c);

               (B) no Conversion of any Advances shall result in more separate
          Borrowings than permitted under Section 2.02(c); and

               (C) each Conversion of Advances comprising part of the same
          Borrowing under any Facility shall be made among the Appropriate
          Lenders in accordance with their respective Pro Rata Shares of such
          Borrowing.

     Each notice of a Conversion (a "Notice of Conversion") shall be delivered
     by telephone, confirmed immediately in writing, or by telecopier, in
     substantially the form of Exhibit B-3 hereto, shall be duly executed by a
     Responsible Officer of the Borrower, and shall, within the restrictions set
     forth in the immediately preceding sentence, specify therein:

          (1) the requested date of such Conversion (which shall be a Business
     Day);

          (2) the Advances requested to be Converted; and

          (3) if such Conversion is into Eurodollar Rate Advances, the requested
     duration of the Interest Period for such Eurodollar Rate Advances.

     The Administrative Agent shall give each of the Appropriate Lenders prompt
     notice of each Notice of Conversion received by it. Each Notice of
     Conversion shall be irrevocable and binding on the Borrower.

          (b) Mandatory.

               (i) On the last day of any Interest Period during which the
          aggregate unpaid principal amount of Eurodollar Rate Advances
          comprising any Borrowing shall be reduced, by payment or prepayment or
          otherwise, to less than $5,000,000, such Advances shall automatically
          Convert into Base Rate Advances.

                                       44

<PAGE>

               (ii) If the Borrower shall fail to select the duration of any
          Interest Period for any Eurodollar Rate Advances in accordance with
          the provisions contained in the definition of "Interest Period" set
          forth in Section 1.01, the Administrative Agent will forthwith so
          notify the Borrower and the Appropriate Lenders, whereupon each such
          Eurodollar Rate Advance will automatically, on the last day of the
          then existing Interest Period therefor, Convert into a Base Rate
          Advance.

               (iii) Upon the occurrence and during the continuance of any
          Default under Section 6.01(f) or any Event of Default, (A) each
          Eurodollar Rate Advance will automatically, on the last day of the
          then existing Interest Period therefor, Convert into a Base Rate
          Advance and (B) the obligation of the Lenders to make, or to Convert
          Advances into, Eurodollar Rate Advances shall be suspended.

     SECTION 2.10. Increased Costs, Etc.
                   ---------------------

          (a) If, after the date hereof, the adoption of any applicable
     Requirement of Law, or any change in any applicable Requirement of Law, or
     any change in the interpretation or administration thereof by any
     Governmental Authority, central bank or comparable agency charged with the
     interpretation or administration thereof, or compliance by any Lender (or
     its Applicable Lending Office) with any request or directive (whether or
     not having the force of law) of any such Governmental Authority, central
     bank or comparable agency:

               (i) shall subject such Lender (or its Applicable Lending Office)
          to any tax, duty, or other charge with respect to any Eurodollar Rate
          Advances, any of its Notes, or its obligation to make any Eurodollar
          Rate Advances, or change the basis of taxation of any amounts payable
          to such Lender (or its Applicable Lending Office) under this Agreement
          or its Note in respect of any Eurodollar Rate Advances (other than,
          for purposes of this Section 2.10, any such increased costs resulting
          from (A) Taxes or Other Taxes (as to which Section 2.13 shall govern),
          and (B) changes in the basis of taxation of overall net income or
          overall gross income by the United States of America or the
          jurisdiction under the laws of which such Lender Party has its
          principal office or such Applicable Lending Office);

               (ii) shall impose, modify, or deem applicable any reserve,
          special deposit, assessment, or similar requirement relating to any
          extensions of credit or other assets of, or any deposits with or other
          liabilities or commitments of, such Lender (or its Applicable Lending
          Office), including the Commitments of such Lender hereunder; or

               (iii) shall impose on such Lender (or its Applicable Lending
          Office) or on the United States market for certificates of deposit or
          the London interbank market any other condition affecting this
          Agreement or its Note or any of such extensions of credit or
          liabilities or commitments;

     and the result of any of the foregoing is to increase the cost to such
     Lender (or its Applicable Lending Office) of making, Converting into or
     maintaining any Eurodollar Rate Advances or to reduce any sum received or
     receivable by such Lender (or its Applicable Lending Office) under this
     Agreement or its Note with respect to any Eurodollar Rate Advances, then
     the Borrower shall pay to such Lender on demand such amount or amounts as
     will compensate such Lender for such increased cost or reduction. Each
     Lender shall promptly notify the Borrower and the Administrative Agent of
     any event of which it has knowledge, occurring after the date hereof, which
     will entitle such Lender to compensation pursuant to this Section 2.10(a)
     and will

                                       45

<PAGE>

     designate a different Applicable Lending Office if such designation will
     avoid the need for, or reduce the amount of, such compensation and will
     not, in the judgment of such Lender, be otherwise disadvantageous to it
     (other than by reason of administrative convenience or preference). Any
     Lender claiming compensation under this Section 2.10(a) shall furnish to
     the Borrower and the Administrative Agent a statement setting forth the
     additional amount or amounts to be paid to it hereunder (including the
     method of calculation), which shall be conclusive and binding, absent
     manifest error. In determining such amount, such Lender may use any
     reasonable averaging and attribution methods. If any Lender requests
     compensation by the Borrower under this Section 2.10(a), the Borrower may,
     by notice to such Lender (with a copy to the Administrative Agent), suspend
     the obligation of such Lender to make or Convert Eurodollar Rate Advances,
     or to Convert Base Rate Advances into Eurodollar Rate Advances, until the
     event or condition giving rise to such request ceases to be in effect (in
     which case the provisions of Section 2.10(e) shall be applicable); provided
     that such suspension shall not affect the right of such Lender to receive
     the compensation so requested.

          (b) If, after the date hereof, any Lender shall have determined that
     the adoption of any applicable Requirement of Law regarding capital
     adequacy or any change therein or in the interpretation or administration
     thereof by any Governmental Authority, central bank or comparable agency
     charged with the interpretation or administration thereof, or any request
     or directive regarding capital adequacy (whether or not having the force of
     law) of any such Governmental Authority, central bank or comparable agency,
     has or would have the effect of reducing the rate of return on the capital
     of such Lender or any corporation controlling such Lender as a consequence
     of such Lender's obligations hereunder to a level below that which such
     Lender or such corporation could have achieved but for such adoption,
     change, request or directive (taking into consideration its policies with
     respect to capital adequacy), then from time to time upon demand the
     Borrower shall pay to such Lender such additional amount or amounts as will
     compensate such Lender for such reduction. Each Lender shall promptly
     notify the Borrower and the Administrative Agent of any event of which it
     has knowledge, occurring after the date hereof, which will entitle such
     Lender to compensation pursuant to this Section 2.10(b) and will designate
     a different Applicable Lending Office if such designation will avoid the
     need for, or reduce the amount of, such compensation and will not, in the
     judgment of such Lender, be otherwise disadvantageous to it. Any Lender
     claiming compensation under this Section 2.10(b) shall furnish to the
     Borrower and the Administrative Agent a statement setting forth the
     additional amount or amounts to be paid to it hereunder (including the
     method of calculation), which shall be conclusive and binding, absent
     manifest error. In determining such amount, such Lender may use any
     reasonable averaging and attribution methods.

          (c) If, on or prior to the first day of any Interest Period for any
     Eurodollar Rate Advance, the Required Lenders at any time notify the
     Administrative Agent that the Eurodollar Rate for any Interest Period for
     such Advances will not adequately and fairly reflect the cost to the
     Appropriate Lenders of funding their Eurodollar Rate Advances for such
     Interest Period, the Administrative Agent shall promptly so notify the
     Borrower and the Appropriate Lenders, whereupon (i) each such Eurodollar
     Rate Advance will automatically, on the last day of the then existing
     Interest Period therefor, Convert into a Base Rate Advance and (ii) the
     obligation of the Appropriate Lenders to make, or to Convert Advances into,
     Eurodollar Rate Advances shall be suspended until the Administrative Agent
     shall notify the Borrower (promptly following notice from the Appropriate
     Lenders) that such Lenders have determined that the circumstances causing
     such suspension no longer exist.

          (d) Notwithstanding any other provision of this Agreement, in the
     event that it becomes unlawful for any Lender or its Applicable Lending
     Office to make, maintain, or fund

                                       46

<PAGE>

     Eurodollar Rate Advances hereunder, then such Lender shall promptly notify
     the Borrower thereof and such Lender's obligation to make Eurodollar Rate
     Advances and to Convert Base Rate Advances into Eurodollar Rate Advances
     shall be suspended until such time as such Lender may again make, maintain
     and fund Eurodollar Rate Advances (in which case the provisions of Section
     2.10(e) shall be applicable).

          (e) If the obligation of any Lender to make a Eurodollar Rate Advance
     or to Convert Base Rate Advances into Eurodollar Rate Advances shall be
     suspended pursuant to any other provision of this Section 2.10, such
     Lender's suspended Eurodollar Rate Advances shall be automatically
     Converted into Base Rate Advances on the last day(s) of the then current
     Interest Period(s) therefor (or, in the case of a Conversion required by
     Section 2.10(d), on such earlier date as such Lender may specify to the
     Borrower with a copy to the Administrative Agent) and, unless and until
     such Lender gives notice as provided below that the circumstances specified
     in such other provision of this Section 2.10 that gave rise to such
     Conversion no longer exist:

               (i) to the extent that such Lender's suspended Eurodollar Rate
          Advances have been so Converted, all payments and prepayments of
          principal that would otherwise be applied to such Lender's suspended
          Eurodollar Rate Advances shall be applied instead to its Base Rate
          Advances; and

               (ii) all Eurodollar Rate Advances that would otherwise be made or
          Converted by such Lender shall be made instead as (or shall remain as)
          Base Rate Advances.

     If such Lender gives notice to the Borrower (with a copy to the
     Administrative Agent) that the circumstances otherwise specified in this
     Section 2.10 that gave rise to the suspension of the making of Eurodollar
     Rate Advances by such Lender no longer exist (which such Lender agrees to
     do promptly upon such circumstances ceasing to exist) at a time when
     Eurodollar Rate Advances by other Lenders with Commitments under the same
     Facility are outstanding, such Lender's Base Rate Advances shall be
     automatically Converted, on the first day(s) of the next succeeding
     Interest Period(s) therefor, to the extent necessary into Eurodollar Rate
     Advances.

     SECTION 2.11. Evidence of Debt.
                   ----------------

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

          (b) The Register maintained by the Administrative Agent pursuant to
     Section 8.07(e) shall include accounts for each Lender, in which accounts
     (taken together) shall be recorded (i) the date and amount of each Advance
     made hereunder, (ii) the terms of each Assignment and Assumption delivered
     to and accepted by it, (iii) the amount of any principal or interest due
     and payable or to become due and payable from the Borrower to each Lender
     hereunder and (iv) the amount of any sum received by the Administrative
     Agent from the Borrower hereunder and each Lender's share thereof.

          (c) The entries made as provided in this Section 2.11 shall be
     conclusive and binding for all purposes, absent manifest error.

                                       47

<PAGE>

     SECTION 2.12. Payments and Computations.
                   -------------------------

          (a) The Borrower shall make each payment hereunder and under the
     Notes, irrespective of any right of counterclaim, deduction or set-off
     (except as otherwise provided in Section 2.16), not later than 2:00 P.M.
     (New York, New York time) on the day when due in U.S. dollars to the
     Administrative Agent at the Administrative Agent's Account in same day
     funds, with payments received by the Administrative Agent after such time
     being deemed to have been received on the next succeeding Business Day. The
     Administrative Agent will promptly thereafter cause like funds to be
     distributed (i) if such payment by the Borrower is in respect of principal,
     interest, commitment fees or any other Obligation then due and payable
     hereunder and under the Notes to more than one Lender Party, to such Lender
     Parties for the accounts of their respective Applicable Lending Offices in
     accordance with their respective Pro Rata Shares of the amounts of such
     respective Obligations due and payable to such Lender Parties at such time
     and (ii) if such payment by the Borrower is in respect of any Obligation
     then due and payable hereunder solely to one Lender Party, to such Lender
     Party for the account of its Applicable Lending Office, in each case to be
     applied in accordance with the terms of this Agreement. Upon its acceptance
     of an Assignment and Assumption and recording of the information contained
     therein in the Register pursuant to Section 8.07(c), from and after the
     effective date of such Assignment and Assumption, the Administrative Agent
     shall make all payments hereunder and under the Notes in respect of the
     interest assigned thereby to the Lender Party assignee thereunder, and the
     parties to such Assignment and Assumption shall make all appropriate
     adjustments in such payments for periods prior to such effective date
     directly between themselves.

          (b) The Borrower hereby authorizes each Lender Party, if and to the
     extent payment owed to such Lender Party is not made when due hereunder or,
     in the case of a Lender, under the Note held by such Lender, to charge from
     time to time against any or all of the Borrower's accounts with such Lender
     Party any amount so due.

          (c) All computations of interest based on the Base Rate shall be made
     by the Administrative Agent on the basis of a year of 365 or 366 days, as
     the case may be, and all computations of interest based on the Eurodollar
     Rate or the Federal Funds Rate and of the letter of credit commissions and
     commitment or letter of credit fees payable hereunder shall be made by the
     Administrative Agent on the basis of a year of 360 days, in each case for
     the actual number of days (including the first day but excluding the last
     day) occurring in the period for which such interest, fees or commissions
     are payable. Each determination by the Administrative Agent of an interest
     rate, fee or commission hereunder shall be conclusive and binding for all
     purposes, absent manifest error.

          (d) Whenever any payment hereunder or under the Notes shall be stated
     to be due on a day other than a Business Day, such payment shall be made on
     the next succeeding Business Day, and such extension of time shall in such
     case be included in the computation of payment of interest, letter of
     credit commissions or commitment or letter of credit fees, as the case may
     be; provided, however, that, if such extension would cause payment of
     interest on or principal of Eurodollar Rate Advances to be made in the next
     succeeding calendar month, such payment shall be made on the immediately
     preceding Business Day.

          (e) Unless the Borrower or any Lender Party has notified the
     Administrative Agent prior to the date any payment is required to be made
     by it to the Administrative Agent hereunder, that the Borrower or such
     Lender Party, as the case may be, will not make such payment, the
     Administrative Agent may assume that the Borrower or such Lender Party, as
     the case may be, has timely made such payment and may (but shall not be so
     required to), in reliance thereon, make available a corresponding amount to
     the Person entitled thereto. If and to the extent that

                                       48

<PAGE>

     such payment was not in fact made to the Administrative Agent in
     immediately available funds, then:

               (i) if the Borrower failed to make such payment, each Lender
          Party shall forthwith on demand repay to the Administrative Agent the
          portion of such assumed payment that was made available to such Lender
          Party in immediately available funds, together with interest thereon
          in respect of each day from and including the date such amount was
          made available by the Administrative Agent to such Lender Party to the
          date such amount is repaid to the Administrative Agent in immediately
          available funds, at the Federal Funds Rate from time to time in
          effect; and

               (ii) if any Lender Party failed to make such payment, such Lender
          Party shall forthwith on demand pay to the Administrative Agent the
          amount thereof in immediately available funds, together with interest
          thereon for the period from the date such amount was made available by
          the Administrative Agent to the Borrower to the date such amount is
          recovered by the Administrative Agent (the "Compensation Period") at a
          rate per annum equal to the Federal Funds Rate from time to time in
          effect. If such Lender Party pays such amount to the Administrative
          Agent, then such amount shall constitute such Lender Party's Advance
          included in the applicable Borrowing. If such Lender Party does not
          pay such amount forthwith upon the Administrative Agent's demand
          therefor, the Administrative Agent may make a demand therefor upon the
          Borrower, and the Borrower shall pay such amount to the Administrative
          Agent, together with interest thereon for the Compensation Period at a
          rate per annum equal to the rate of interest applicable to the
          applicable Borrowing. Nothing herein shall be deemed to relieve any
          Lender Party from its obligation to fulfill its applicable Commitment
          or to prejudice any rights which the Administrative Agent or the
          Borrower may have against any Lender Party as a result of any default
          by such Lender Party hereunder.

     A notice from the Administrative Agent to any Lender Party with respect to
     any amount owing under this subsection (e) shall be conclusive, absent
     manifest error.

          (f) Whenever any payment received by the Administrative Agent under
     this Agreement or any of the other Loan Documents is insufficient to pay in
     full all amounts due and payable to the Agents and the Lender Parties under
     or in respect of this Agreement and the other Loan Documents on any date,
     such payment shall be distributed by the Administrative Agent and applied
     by the Agents and the Lender Parties in the following order of priority:

               (i) first, to the payment of all of the fees, indemnification
          payments, costs and expenses that are due and payable to the Agents
          (solely in their respective capacities as Agents) under or in respect
          of this Agreement and the other Loan Documents on such date, ratably
          based upon the respective aggregate amounts of all such fees,
          indemnification payments, costs and expenses owing to the Agents on
          such date;

               (ii) second, to the payment of all of the fees, indemnification
          payments, costs and expenses that are due and payable to the Issuing
          Bank and the Swing Line Bank (solely in their respective capacities as
          such) under or in respect of this Agreement and the other Loan
          Documents on such date, ratably based upon the respective aggregate
          amounts of all such fees, indemnification payments, costs and expenses
          owing to the Issuing Bank and the Swing Line Bank on such date;

                                       49

<PAGE>

               (iii) third, to the payment of all of the indemnification
          payments, costs and expenses that are due and payable to the Lenders
          under Section 8.04 hereof, Section 12 of the Subsidiary Guarantee,
          Section 21 of the Security Agreement and any similar section of any of
          the other Loan Documents on such date, ratably based upon the
          respective aggregate amounts of all such indemnification payments,
          costs and expenses owing to the Lenders on such date;

               (iv) fourth, to the payment of all of the amounts that are due
          and payable to the Administrative Agent and the Lender Parties under
          Sections 2.10 and 2.13 hereof and Section 5 of the Subsidiary
          Guarantee on such date, ratably based upon the respective aggregate
          amounts thereof owing to the Administrative Agent and the Lender
          Parties on such date;

               (v) fifth, to the payment of all of the accrued and unpaid
          interest on the Obligations of the Borrower under or in respect of the
          Loan Documents that is due and payable to the Administrative Agent and
          the Lender Parties under Section 2.07(a) on such date and all of the
          fees that are due and payable to the Lenders or the Issuing Bank under
          Section 2.08(a) or 2.08(b) on such date, ratably based upon the
          respective aggregate Commitments of the Lenders under the Facilities
          on such date;

               (vi) sixth, to the payment of the principal amount of all of the
          outstanding Advances that is due and payable to the Administrative
          Agent and the Lender Parties on such date, ratably based upon the
          respective aggregate amounts of all such principal owing to the
          Administrative Agent and the Lender Parties on such date; and

               (vii) seventh, to the payment of all other Obligations of the
          Loan Parties owing under or in respect of the Loan Documents that are
          due and payable to the Administrative Agent and the other Secured
          Parties on such date, ratably based upon the respective aggregate
          amounts of all such Obligations owing to the Administrative Agent and
          the other Secured Parties on such date.

     If the Administrative Agent receives funds for application to the
     Obligations of the Loan Parties under or in respect of the Loan Documents
     under circumstances for which the Loan Documents do not specify the
     Advances or the Facility to which, or the manner in which, such funds are
     to be applied, the Administrative Agent may, but shall not be obligated to,
     elect to distribute such funds to each of the Lender Parties in accordance
     with such Lender Party's Pro Rata Share of the sum of (A) the aggregate
     principal amount of all Advances outstanding at such time and (b) the
     aggregate Available Amount of all Letters of Credit outstanding at such
     time, in repayment or prepayment of such of the outstanding Advances or
     other Obligations then owing to such Lender Party, and, in the case of the
     Term Facility, for application to such principal repayment installments
     thereof, as the Administrative Agent shall direct.

     SECTION 2.13. Taxes.
                   -----

          (a) Any and all payments by the Borrower to or for the account of any
     Lender Party or any Agent hereunder or under any other Loan Document shall
     be made, in accordance with Section 2.12 or the applicable provisions of
     such other Loan Document, if any, free and clear of and without deduction
     for any and all present or future taxes, levies, imposts, deductions,
     charges or withholdings, and all liabilities with respect thereto,
     excluding, in the case of each Lender Party and each Agent, taxes that are
     imposed on its overall net income by the United States and taxes that are
     imposed on its overall net income (and franchise taxes imposed in lieu
     thereof) by

                                       50

<PAGE>

     the state or foreign jurisdiction under the laws of which such Lender Party
     or such Agent, as the case may be, is organized or is a resident, or has a
     fixed place of business or a permanent establishment, or any political
     subdivision of any of the foregoing, and, in the case of each Lender Party,
     taxes that are imposed on its overall net income (and franchise taxes
     imposed in lieu thereof) by the state or foreign jurisdiction of either of
     its Applicable Lending Offices or any political subdivision thereof (all
     such nonexcluded taxes, levies, imposts, deductions, charges, withholdings
     and liabilities in respect of payments hereunder or under the Notes being,
     collectively, "Taxes"). If the Borrower shall be required under applicable
     Requirements of Law to deduct any Taxes from or in respect of any sum
     payable hereunder or under any other Loan Document to any Lender Party or
     any Agent, (i) the sum payable by the Borrower shall be increased as
     necessary so that after the Borrower and the Administrative Agent have been
     made all required deductions (including deductions applicable to additional
     sums payable under this Section 2.13) such Lender Party or such Agent, 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, (iii) the Borrower shall pay the full amount deducted to the
     relevant taxation authority or other Governmental Authority in accordance
     with applicable Requirements of Law and (iv) within 30 days after the date
     of any payment of Taxes, the Borrower shall furnish to the Administrative
     Agent, at its address referred to in Section 8.02, the original or a
     certified copy of a receipt evidencing payment thereof, to the extent such
     a receipt is issued therefor, or other written proof of payment thereof
     that is reasonably satisfactory to the Administrative Agent.

          (b) In addition, the Borrower agrees to pay any present or future
     stamp, recording or documentary, excise, property or similar taxes, charges
     or levies that arise from any payment made hereunder or under any other
     Loan Document or from the execution, delivery of, or registration of, any
     performance under, or otherwise with respect to, this Agreement or any
     other Loan Document (collectively, "Other Taxes").

          (c) The Borrower shall indemnify each of the Lender Parties and each
     of the Agents for, and hold each of them harmless against, the full amount
     of Taxes and Other Taxes, and the full amount of taxes of any kind imposed
     by any jurisdiction on amounts payable under this Section 2.13, imposed on
     or paid by such Lender Party or such Agent, as the case may be, and any
     liability (including penalties, additions to tax, interest and expenses)
     arising therefrom or with respect thereto. The indemnity by the Borrower
     provided for in this subsection (c) shall apply and be made whether or not
     the Taxes or Other Taxes for which indemnification hereunder is sought have
     been correctly or legally asserted; provided, however, that such Lender or
     such Agent seeking such indemnification shall take all reasonable actions
     (consistent with its internal policy and legal and regulatory restrictions)
     requested by the Borrower to assist the Borrower in recovering the amounts
     paid thereby pursuant to this subsection (c) from the relevant taxation
     authority or other Governmental Authority. Amounts payable by the Borrower
     under the indemnity set forth in this subsection (c) shall be paid within
     30 days from the date on which the applicable Lender or Agent, as the case
     may be, makes written demand therefor (including the method of
     calculation).

          (d) In the case of any payment hereunder or under any other Loan
     Document by or on behalf of the Borrower through an account or branch
     outside the United States, or on behalf of the Borrower by a payor that is
     not a United States person, if the Borrower determines that no Taxes are
     payable in respect thereof, the Borrower shall furnish, or shall cause such
     payor to furnish, to the Administrative Agent, at its address referred to
     in Section 8.02, an opinion of counsel reasonably acceptable to the
     Administrative Agent stating that such payment is exempt from Taxes. For
     purposes of this subsection (d) and subsection (e) of this Section 2.13,
     the terms

                                       51

<PAGE>

     "United States" and "United States person" shall have the meanings
     specified in Section 7701 of the Internal Revenue Code.

          (e) Each Lender Party organized under the laws of a jurisdiction
     outside the United States shall, on or prior to the date of its execution
     and delivery of this Agreement in the case of each Initial Lender, the
     Swing Line Bank or the Initial Issuing Bank, as the case may be, and on or
     prior to the date of the Assignment and Assumption pursuant to which it
     becomes a Lender Party in the case of each other Lender Party, and from
     time to time thereafter as reasonably requested in writing by the Borrower
     (but only so long thereafter as such Lender Party remains lawfully able to
     do so), provide each of the Administrative Agent and the Borrower with two
     original Internal Revenue Service forms W-8BEN, W-8ECI or W-8IMY, or in the
     case of a Lender Party that has certified in writing to the Administrative
     Agent that it is claiming exemption from United States withholding tax
     under Section 871(h) or 881(c) of the Internal Revenue Code with respect to
     payments of "portfolio interest" from W-8BEN), (and, if such Lender Party
     delivers a form W-8BEN, a certificate representing that such Lender Party
     is not (i) a "bank" for purposes of Section 881(c) of the Internal Revenue
     Code, (ii) a ten-percent shareholder (within the meaning of Section
     871(h)(3)(B) of the Internal Revenue Code) of the Borrower or (iii) a
     controlled foreign corporation related to the Borrower (within the meaning
     of Section 864(d)(4) of the Internal Revenue Code)), as appropriate, or any
     successor or other form prescribed by the Internal Revenue Service,
     certifying that such Lender Party is exempt from or entitled to a reduced
     rate of United States withholding tax on payments pursuant to this
     Agreement or any other Loan Document or, in the case of a Lender Party
     providing a form W-8BEN, certifying that such Lender Party is a foreign
     corporation, partnership, estate or trust. If any such forms provided by a
     Lender Party at the time such Lender Party first becomes a party to this
     Agreement indicate a United States interest withholding tax rate in excess
     of zero, withholding tax at such rate shall be considered excluded from
     Taxes unless and until such Lender Party provides the appropriate form
     certifying that a lesser rate applies, whereupon withholding tax at such
     lesser rate only shall be considered excluded from Taxes solely for the
     periods governed by such forms. However, if at the date of the Assignment
     and Assumption pursuant to which a Lender Party becomes a party to this
     Agreement, the Lender Party assignor was entitled to payments under
     subsection (a) of this Section 2.13 in respect of United States withholding
     tax with respect to interest paid at such date, then, to such extent, the
     term Taxes shall include (in addition to withholding taxes that may be
     imposed in the future or other amounts otherwise includable in Taxes)
     United States withholding tax, if any, applicable with respect to the
     Lender Party assignee on such date. None of the Lender Parties shall be
     entitled to payment pursuant to subsection (a) or (c) of this Section 2.13
     with respect to any additional Taxes that result solely and directly from a
     change in either of the Applicable Lending Offices of such Lender Party
     (other than any such additional Taxes that are imposed as a result of a
     change in the applicable Requirements of Law, or in the interpretation of
     application thereof, occurring after the date of such change), unless such
     change is made pursuant to the terms of Section 2.10(e) or subsection (g)
     of this Section 2.13 or as a result of a request therefor by the Borrower.

          (f) For any period with respect to which a Lender Party has failed to
     provide the Borrower with the appropriate form, certificate or other
     document described in subsection (e) of this Section 2.13 (other than if
     such failure is due to a change in the applicable Requirements of Law, or
     in the interpretation or application thereof, occurring after the date on
     which a form, certificate or other document originally was required to be
     provided or if such form, certificate or other document otherwise is not
     required under subsection (e) of this Section 2.13), such Lender Party
     shall not be entitled to indemnification under subsection (a) or (c) of
     this Section 2.13 with respect to Taxes imposed by the United States by
     reason of such failure; provided, however, that should a Lender Party
     become subject to Taxes because of its failure to deliver a form,
     certificate

                                       52

<PAGE>

     or other document required hereunder, the Borrower shall take such steps as
     such Lender Party shall reasonably request to assist such Lender Party in
     recovering such Taxes.

          (g) Each of the Lender Parties hereby agrees that, upon the occurrence
     of any circumstances entitling such Lender Party to additional amounts
     pursuant to this Section 2.13, such Lender Party shall use reasonable
     efforts (consistent with its internal policy and legal and regulatory
     restrictions) to designate a different Applicable Lending Office if the
     making of such a change would avoid the need for, or reduce the amount of,
     any such additional amounts that may thereafter accrue and would not, in
     the reasonable judgment of such Lender Party, be otherwise disadvantageous
     to such Lender Party (other than by reason of administrative convenience or
     preference).

     SECTION 2.14. Sharing of Payments, Etc. If any Lender Party shall obtain at
                   ------------------------
any time any payment (whether voluntary, involuntary, through the exercise of
any right of setoff, or otherwise) (a) on account of Obligations due and payable
to such Lender Party under or in respect of this Agreement or any of 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
Party at such time (other than pursuant to Section 2.10, 2.13, 8.04 or 8.07) to
(ii) the aggregate amount of the Obligations due and payable to all Lender
Parties at such time) of payments on account of the Obligations due and payable
to all Lender Parties under or in respect of this Agreement and the other Loan
Documents at such time obtained by all the Lender Parties at such time or (b) on
account of Obligations owing (but not due and payable) to such Lender Party
under or in respect of this Agreement or any of 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 to such Lender Party at such time (other than
pursuant to Section 2.10, 2.13, 8.04 or 8.07) to (ii) the aggregate amount of
the Obligations owing (but not due and payable) to all Lender Parties under or
in respect of this Agreement and the other Loan Documents at such time) of
payments on account of the Obligations owing (but not due and payable) to all
Lender Parties under or in respect of this Agreement and the other Loan
Documents at such time obtained by all of the Lender Parties at such time, such
Lender Party shall forthwith purchase from the other Lender Parties such
interests or participating interests in the Obligations due and payable or owing
to them, as the case may be, as shall be necessary to cause such purchasing
Lender Party to share the excess payment ratably with each of them; provided,
however, that if all or any portion of such excess payment is thereafter
recovered from such purchasing Lender Party, such purchase from each other
Lender Party shall be rescinded and such other Lender Party shall repay to the
purchasing Lender Party the purchase price to the extent of such Lender Party's
ratable share (according to the proportion of (A) the purchase price paid to
such Lender Party to (B) the aggregate purchase price paid to all Lender
Parties) of such recovery, together with an amount equal to such Lender Party's
ratable share (according to the proportion of (1) the amount of such other
Lender Party's required repayment to (2) the total amount so recovered from the
purchasing Lender Party) of any interest or other amount paid or payable by the
purchasing Lender Party in respect of the total amount so recovered; provided
further that, so long as the Obligations under the Loan Documents shall not have
been accelerated, any excess payment received by any Appropriate Lender shall be
shared on a pro rata basis only with other Appropriate Lenders. The Borrower
hereby agrees that any Lender Party so purchasing an interest or participating
interest from another Lender Party pursuant to this Section 2.14 may, to the
fullest extent permitted under applicable law, exercise all its rights of
payment (including the right of setoff) with respect to such an interest or
participating interest, as the case may be, as fully as if such Lender Party
were the direct creditor of the Borrower in the amount of such an interest or
participating interest.

     SECTION 2.15. Use of Proceeds. The proceeds of the Advances and issuances
                   ---------------
of Letters of Credit shall be available (and the Borrower agrees that it shall
use such proceeds and Letters of Credit) solely to purchase the 2001
Subordinated Notes, to purchase its common stock as contemplated in Section

                                       53

<PAGE>

5.02(g)(v), to repay all principal, accrued interest and fees to the lenders and
agents under the Existing Credit Agreement, for acquisitions as permitted herein
and for general corporate purposes of the Borrower and its Subsidiaries, and to
pay fees and expenses incurred in connection with the consummation of the
Transaction.

     SECTION 2.16. Defaulting Lenders.
                   ------------------

          (a) In the event that, at any one time, (i) any Lender Party shall be
     a Defaulting Lender, (ii) such Defaulting Lender shall owe a Defaulted
     Advance to the Borrower and (iii) the Borrower shall be required to make
     any payment hereunder or under any other Loan Document to or for the
     account of such Defaulting Lender, then the Borrower may, so long as no
     Default shall occur or be continuing at such time and to the fullest extent
     permitted by applicable law, set off and otherwise apply the Obligation of
     the Borrower to make such payment to or for the account of such Defaulting
     Lender against the obligation of such Defaulting Lender to make such
     Defaulted Advance. In the event that, on any date, the Borrower shall so
     set off and otherwise apply its obligation to make any such payment against
     the obligation of such Defaulting Lender to make any such Defaulted Advance
     on or prior to such date, the amount so set off and otherwise applied by
     the Borrower shall constitute for all purposes of this Agreement and the
     other Loan Documents an Advance by such Defaulting Lender made on the date
     of such setoff under the Facility pursuant to which such Defaulted Advance
     was originally required to have been made pursuant to Section 2.01. Such
     Advance shall be a Base Rate Advance and shall be considered, for all
     purposes of this Agreement, to comprise part of the Borrowing in connection
     with which such Defaulted Advance was originally required to have been made
     pursuant to Section 2.01, even if the other Advances comprising such
     Borrowing shall be Eurodollar Rate Advances on the date such Advance is
     deemed to be made pursuant to this subsection (a). The Borrower shall
     notify the Administrative Agent at any time the Borrower exercises its
     right of set-off pursuant to this subsection (a) and shall set forth in
     such notice (A) the name of the Defaulting Lender and the Defaulted Advance
     required to be made by such Defaulting Lender and (B) the amount set off
     and otherwise applied in respect of such Defaulted Advance pursuant to this
     subsection (a). Any portion of such payment otherwise required to be made
     by the Borrower to or for the account of such Defaulting Lender which is
     paid by the Borrower, after giving effect to the amount set off and
     otherwise applied by the Borrower pursuant to this subsection (a), shall be
     applied by the Administrative Agent as specified in subsection (b) or (c)
     of this Section 2.16.

          (b) In the event that, at any one time, (i) any Lender Party shall be
     a Defaulting Lender, (ii) such Defaulting Lender shall owe a Defaulted
     Amount to the Administrative Agent or any of the other Lender Parties and
     (iii) the Borrower shall make any payment hereunder or under any other Loan
     Document to the Administrative Agent for the account of such Defaulting
     Lender, then the Administrative Agent may, on its behalf or on behalf of
     such other Lender Parties and to the fullest extent permitted by applicable
     law, apply at such time the amount so paid by the Borrower to or for the
     account of such Defaulting Lender to the payment of each such Defaulted
     Amount to the extent required to pay such Defaulted Amount. In the event
     that the Administrative Agent shall so apply any such amount to the payment
     of any such Defaulted Amount on any date, the amount so applied by the
     Administrative Agent shall constitute for all purposes of this Agreement
     and the other Loan Documents payment, to such extent, of such Defaulted
     Amount on such date. Any such amount so applied by the Administrative Agent
     shall be retained by the Administrative Agent or distributed by the
     Administrative Agent to such other Lender Parties, ratably in accordance
     with the respective portions of such Defaulted Amounts payable at such time
     to the Administrative Agent and such other Lender Parties and, if the
     amount of such payment made by the Borrower shall at such time be
     insufficient to pay all

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<PAGE>

     Defaulted Amounts owing at such time to the Administrative Agent and the
     other Lender Parties, in the following order of priority:

                    (A) first, to the Administrative Agent for any Defaulted
               Amount then owing to the Administrative Agent;

                    (B) second, to the Issuing Bank and the Swing Line Bank for
               any Defaulted Amount then owing to them, in their capacities as
               such, ratably in accordance with such respective Defaulted
               Amounts then owing to such Issuing Bank and such Swing Line Bank;
               and

                    (C) third, to any other Lender Parties for any Defaulted
               Amounts then owing to such other Lender Parties, ratably in
               accordance with such respective Defaulted Amounts then owing to
               such other Lender Parties.

     Any portion of such amount paid by the Borrower for the account of such
     Defaulting Lender remaining, after giving effect to the amount applied by
     the Administrative Agent pursuant to this subsection (b), shall be applied
     by the Administrative Agent as specified in subsection (c) of this Section
     2.16.

          (c) In the event that, at any one time, (i) any Lender Party shall be
     a Defaulting Lender, (ii) such Defaulting Lender shall not owe a Defaulted
     Advance or a Defaulted Amount and (iii) the Borrower, the Administrative
     Agent or any other Lender Party shall be required to pay or distribute any
     amount hereunder or under any other Loan Document to or for the account of
     such Defaulting Lender, then the Borrower or such other Lender Party shall
     pay such amount to the Administrative Agent to be held by the
     Administrative Agent, to the fullest extent permitted by applicable law, in
     escrow or the Administrative Agent shall, to the fullest extent permitted
     by applicable law, hold in escrow such amount otherwise held by it. Any
     funds held by the Administrative Agent in escrow under this subsection (c)
     shall be deposited by the Administrative Agent in an account with CSFB, in
     the name and under the control of the Administrative Agent, but subject to
     the provisions of this subsection (c). The terms applicable to such
     account, including the rate of interest payable with respect to the credit
     balance of such account from time to time, shall be CSFB's standard terms
     applicable to escrow accounts maintained with it. Any interest credited to
     such account from time to time shall be held by the Administrative Agent in
     escrow under, and applied by the Administrative Agent from time to time in
     accordance with the provisions of, this subsection (c). The Administrative
     Agent shall, to the fullest extent permitted by applicable law, apply all
     funds so held in escrow from time to time to the extent necessary to make
     any Advances required to be made by such Defaulting Lender and to pay any
     amount payable by such Defaulting Lender hereunder and under the other Loan
     Documents to the Administrative Agent or any other Lender Party, as and
     when such Advances or amounts are required to be made or paid and, if the
     amount so held in escrow shall at any time be insufficient to make and pay
     all such Advances and amounts required to be made or paid at such time, in
     the following order of priority:

                    (A) first, to the Administrative Agent for any amount then
               due and payable by such Defaulting Lender to the Administrative
               Agent hereunder;

                    (B) second, to the Issuing Bank and the Swing Line Bank for
               any amounts then due and payable to them hereunder, in their
               capacities as such, by such Defaulting Lender, ratably in
               accordance with such amounts then due and payable to such Issuing
               Bank and such Swing Line Bank;

                                       55

<PAGE>

                    (C) third, to any other Lender Parties for any amount then
               due and payable by such Defaulting Lender to such other Lender
               Parties hereunder, ratably in accordance with such respective
               amounts then due and payable to such other Lender Parties; and

                    (D) fourth, to the Borrower for any Advance then required to
               be made by such Defaulting Lender pursuant to a Commitment of
               such Defaulting Lender.

     In the event that any Lender Party that is a Defaulting Lender shall, at
     any time, cease to be a Defaulting Lender, any funds held by the
     Administrative Agent in escrow at such time with respect to such Lender
     Party shall be distributed by the Administrative Agent to such Lender Party
     and applied by such Lender Party to the Obligations owing to such Lender
     Party at such time under this Agreement and the other Loan Documents
     ratably in accordance with the respective amounts of such Obligations
     outstanding at such time.

          (d) The rights and remedies against a Defaulting Lender under this
     Section 2.16 are in addition to other rights and remedies that the Borrower
     may have against such Defaulting Lender with respect to any Defaulted
     Advance and that the Administrative Agent or any Lender Party may have
     against such Defaulting Lender with respect to any Defaulted Amount.

                                  ARTICLE III

                            CONDITIONS OF LENDING AND
                         ISSUANCES OF LETTERS OF CREDIT

     SECTION 3.01. Conditions Precedent to Initial Extension of Credit. The
                   ---------------------------------------------------
obligation of each Lender to make an Advance or of the Issuing Bank to issue a
Letter of Credit on the occasion of the Initial Extension of Credit hereunder is
subject to the satisfaction of the following conditions precedent before or
concurrently with the Initial Extension of Credit:

          (a) The Administrative Agent shall have received on or before the day
     of the Initial Extension of Credit the following, each dated such day
     (unless otherwise specified), in form and substance satisfactory to the
     Administrative Agent (unless otherwise specified) and (except for the
     Notes) in sufficient copies for each Lender Party:

               (i) The Notes payable to the order of each respective Lender (if
          requested by any such Lender).

               (ii) A security agreement, in substantially the form of Exhibit D
          hereto (together with each other security agreement and security
          agreement supplement delivered pursuant to Section 5.01(j), in each
          case as amended, the "Security Agreement"), duly executed by each Loan
          Party, together with:

                    (A) where applicable, certificates representing the Pledged
               Shares referred to therein accompanied by undated stock powers
               executed in blank and instruments evidencing the Pledged Debt
               referred to therein indorsed in blank,

                    (B) proper financing statements, in form for filing, under
               the Uniform Commercial Code of the jurisdiction of incorporation
               of each Loan

                                       56

<PAGE>

               Party to the Security Agreement, covering the Collateral
               described in the Security Agreement,

                    (C) all other documents for recording and filing, in proper
               form, for or with respect to the Security Agreement that the
               Administrative Agent may deem necessary or desirable in order to
               perfect and protect the Liens created thereby,

                    (D) evidence of the insurance required by the terms of the
               Security Agreement,

                    (E) evidence that all other action that the Administrative
               Agent may deem necessary or desirable in order to perfect and
               protect the first priority liens and security interests created
               under the Security Agreement is ready to be taken concurrently
               with the Initial Extension of Credit (including, without
               limitation, receipt of UCC-3 termination statements with respect
               to the Existing Credit Agreement).

               (iii) A guarantee, in substantially the form of Exhibit E hereto
          (together with each other guarantee and guarantee supplement delivered
          pursuant to Section 5.01(j), in each case as amended, the "Subsidiary
          Guarantee"), duly executed by each Guarantor.

               (iv) An intellectual property security agreement, in
          substantially the form annexed to the Security Agreement (together
          with each other intellectual property security agreement and
          intellectual property security agreement supplement delivered pursuant
          to Section 5.01(j), in each case as amended, the "Intellectual
          Property Security Agreement"), duly executed by each Loan Party,
          together with evidence that all action that the Administrative Agent
          may deem necessary or desirable in order to perfect and protect the
          first priority liens and security interests created under the
          Intellectual Property Security Agreement is ready to be taken
          concurrently with the Initial Extension of Credit.

               (v) Certified copies of the resolutions of the Board of Directors
          of each Loan Party approving the Transaction and each Loan Document to
          which it is or is to be a party, and of all documents evidencing other
          necessary Governmental Authorizations and other necessary corporate
          actions or third party approvals and consents, if any, with respect to
          the Transaction and each Loan Document to which it is or is to be a
          party.

               (vi) A copy of a certificate of the Secretary of State of the
          jurisdiction of incorporation of each Loan Party, dated reasonably
          near the date of the Initial Extension of Credit, certifying (A) as to
          a true and correct copy of the charter (or comparable Constitutive
          Document) of such Loan Party and each amendment thereto on file in
          such Secretary's office (B) that such amendments are the only
          amendments to such Loan Party's (or comparable Constitutive Document)
          on file in such Secretary's office, and (C) such Loan Party is duly
          incorporated and in good standing or presently subsisting under the
          laws of the State of the jurisdiction of its incorporation.

               (vii) A certificate of each Loan Party, signed on behalf of such
          Loan Party by its President or a Vice President and its Secretary or
          any Assistant Secretary, dated the date of the Initial Extension of
          Credit (the statements made in which certificate shall be true on and
          as of the date of the Initial Extension of Credit), certifying as to
          (A) the absence of any amendments to the charter (or comparable
          Constitutive Document) of

                                       57

<PAGE>

          such Loan Party since the date of the Secretary of State's certificate
          referred to in Section 3.01(a)(vi), (B) a true and correct copy of the
          bylaws (or comparable Constitutive Document) of such Loan Party as in
          effect on the date on which the resolutions referred to in Section
          3.01(a)(v) were adopted and on the date of the Initial Extension of
          Credit, (C) the due incorporation and good standing or valid existence
          of such Loan Party as a corporation organized under the laws of the
          jurisdiction of its incorporation, and the absence of any proceeding
          for the dissolution or liquidation of such Loan Party, and (D) the
          truth of the representations and warranties contained in the Loan
          Documents as though made on and as of the date of the Initial
          Extension of Credit except for representations and warranties that by
          their terms speak as of another specific date, which shall be true as
          of such specific date.

               (viii) A certificate of the Secretary or an Assistant Secretary
          of each Loan Party certifying the names and true signatures of the
          officers of such Loan Party authorized to sign each Loan Document to
          which it is or is to be a party and the other documents to be
          delivered hereunder and thereunder.

               (ix) Such financial, business and other information regarding
          each Loan Party and its Subsidiaries as the Lender Parties shall have
          reasonably requested, including, without limitation, information as to
          possible contingent liabilities, tax matters, environmental matters,
          obligations under Plans, Multiemployer Plans and Welfare Plans,
          collective bargaining agreements and other arrangements with
          employees, audited annual financial statements dated December 31,
          2001, interim financial statements dated the end of the most recent
          fiscal quarter for which financial statements are available, pro forma
          financial statements as to the Borrower and forecasts prepared by
          management of the Company, of balance sheets, income statements and
          cash flow statements on a quarterly basis for the first year following
          the day of the Initial Extension of Credit and on an annual basis for
          five years thereafter.

               (x) Evidence of insurance naming the Administrative Agent as
          additional insured and loss payee with such responsible and reputable
          insurance companies or associations, and in such amounts and covering
          such risks, as is satisfactory to the Lender Parties, including,
          without limitation, business interruption insurance.

               (xi) The Intercreditor Agreement duly executed by the Agent on
          behalf of the Lenders, the Collateral Agent, as defined therein, and
          any Lender or Affiliate thereof who is then a party to a Hedge
          Agreement.

               (xii) A Notice of Borrowing or Notice of Issuance, as applicable.

               (xiii) A favorable opinion of Steven J. Udicious, general counsel
          for the Loan Parties, in substantially the form of Exhibit F hereto
          and as to such other matters as any Lender Party through the
          Administrative Agent may reasonably request.

               (xiv) A favorable opinion of Riordan & McKinzie, special counsel
          to the Lender Parties, in substantially the form of Exhibit G hereto
          and as to such other matters as any Lender Party through the
          Administrative Agent may reasonably request.

          (b) The Administrative Agent shall have received satisfactory evidence
     that not less than 90% of the principal amount of the 2001 Subordinated
     Notes has been tendered to, and purchased by, the Borrower pursuant to an
     Offer to Purchase and Consent Solicitation dated

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<PAGE>

     March 21, 2002 and that any covenants in the Indenture relating to such
     notes prohibiting the Borrower entering into this Agreement or the
     consummation of the transactions contemplated hereby have been eliminated,
     waived or otherwise discharged pursuant to a duly executed Supplemental
     Indenture or other instrument satisfactory to the Administrative Agent.

          (c) All Governmental Authorizations and all third party consents and
     approvals necessary in connection with the Transaction shall have been
     obtained (without the imposition of any conditions that are not acceptable
     to the Lender Parties) and shall remain in effect; and no Requirements of
     Law shall be applicable in the judgment of the Lender Parties that
     restrains, prevents or imposes materially adverse conditions upon the
     Transaction.

          (d) The Borrower shall have paid all accrued fees of the Agents and
     the Lender Parties and all accrued expenses of the Agents.

          (e) (i) All amounts owing by the Borrower or any of its Subsidiaries
     to the lenders and agents under the Existing Credit Agreement shall have
     been, or concurrently with the Initial Extension of Credit made on the
     Closing Date shall be, paid in full, (ii) all commitments of the lenders
     under the Existing Credit Agreement (except for the Existing Letters of
     Credit) shall have been, or concurrently with the Initial Extension of
     Credit made on the Closing Date shall be, terminated in accordance with the
     terms of the Existing Credit Agreement, (iii) the lenders or any collateral
     agent under the Existing Credit Agreement shall have executed such
     instruments (including without limitation Uniform Commercial Code
     termination statements) and agreed to take such other actions as are
     reasonably necessary to terminate or release all security interests granted
     in connection with the Existing Credit Agreement and (iv) adequate
     arrangements shall have been made with the issuer of the Existing Letters
     of Credit concerning the continuation thereof.

     SECTION 3.02. Conditions Precedent to Each Borrowing and Issuance and
                   -------------------------------------------------------
                   Renewal.
                   --------

The obligation of each Appropriate Lender to make an Advance (other
than a Letter of Credit Advance made by the Issuing Bank or a Revolving Credit
Lender pursuant to Section 2.03(b) and a Swing Line Advance made by a Revolving
Credit Lender pursuant to Section 2.02(b)) on the occasion of each Borrowing
(including the initial Borrowing, but excluding any conversion of Advances
pursuant to Section 2.09 as provided therein), and the obligation of the Issuing
Bank to issue a Letter of Credit (including the initial issuance) or renew a
Letter of Credit and the right of the Borrower to request a Swing Line
Borrowing, shall be subject to the further conditions precedent that on the date
of such Borrowing or issuance or renewal (a) the following statements shall be
true and the Administrative Agent shall have received for the account of such
Lender or the Issuing Bank a certificate signed by a duly authorized officer of
the Borrower, dated the date of such Borrowing or issuance or renewal, stating
that (and each of the giving of the applicable Notice of Borrowing, Notice of
Swing Line Borrowing, Notice of Issuance or Notice of Renewal and the acceptance
by the Borrower of the proceeds of such Borrowing or of such Letter of Credit or
the renewal of such Letter of Credit shall constitute a representation and
warranty by the Borrower that both on the date of such notice and on the date of
such Borrowing or issuance or renewal such statements are true):

          (i) the representations and warranties contained in each Loan Document
     are correct on and as of such date, before and after giving effect to such
     Borrowing or issuance or renewal and to the application of the proceeds
     therefrom, as though made on and as of such date except (A) for any such
     representations or warranties that, by their terms, refer to a specific
     date other than the date of such Borrowing or issuance or renewal, in which
     case as of such specific date and (B) if any Required Financial Information
     has been delivered to the Administrative Agent and the Lender Parties on or

                                       59

<PAGE>

     prior to the date of such Borrowing or issuance or renewal, that the
     Consolidated financial statements of the Borrower and its Subsidiaries
     referred to in Section 4.01(g)(i) shall be deemed at any time and from time
     to time after the Closing Date to refer to the Consolidated financial
     statements of the Borrower and its Subsidiaries comprising part of the
     Required Financial Information most recently delivered to the
     Administrative Agent and the Lender Parties pursuant to Sections 5.03(b)
     and 5.03(c) (except that in the case of financial statements delivered
     pursuant to Section 5.03(c), such financial statements may not contain all
     notes and may be subject to year end audit adjustments), respectively, on
     or prior to the date of such Borrowing, issuance or renewal; and

          (ii) no Default has occurred and is continuing, or would result from
     such Borrowing or issuance or renewal or from the application of the
     proceeds therefrom;

and (b) the Administrative Agent shall have received such other approvals,
opinions or documents as any Appropriate Lender through the Administrative Agent
may reasonably request.

SECTION 3.03. Determinations Under Section 3.01. For purposes of determining
              ---------------------------------
compliance with the conditions specified in Section 3.01, each Lender Party
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 the Lender Parties unless an
officer of the Administrative Agent responsible for the transactions
contemplated by the Loan Documents shall have received notice from such Lender
Party prior to the Initial Extension of Credit specifying its objection thereto
and, if the Initial Extension of Credit consists of a Borrowing, such Lender
Party shall not have made available to the Administrative Agent such Lender
Party's ratable portion of such Borrowing.

                                   ARTICLE IV

                         REPRESENTATIONS AND WARRANTIES

     SECTION 4.01. Representations and Warranties of the Borrower. The Borrower
                   ----------------------------------------------
represents and warrants as follows:

          (a) Each Loan Party and each of its Subsidiaries (i) is duly
     organized, validly existing and in good standing (if such concept is
     applicable) under the laws of the jurisdiction of its organization, (ii) is
     duly qualified and in good standing as a foreign business enterprise (if
     such concept is applicable) in each other jurisdiction in which it owns or
     leases property or in which the conduct of its business requires it to so
     qualify or be licensed except where the failure to be so qualified or
     licensed would not result in a Material Adverse Effect and (iii) has all
     requisite power and authority (including, without limitation, all material
     Governmental Authorizations) to own or lease and operate its properties and
     to carry on its business as now conducted and as proposed to be conducted.

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<PAGE>

          (b) Set forth on Schedule 4.01(b) hereto is a complete and accurate
     list of all Subsidiaries of the Borrower, showing as of the date hereof (as
     to each such Subsidiary) the jurisdiction of its organization, the number
     of shares or other units of each class of its Equity Interests authorized,
     and the number outstanding, on the date hereof and the percentage of each
     such class of its Equity Interests owned (directly or indirectly) by the
     Borrower or any Subsidiary thereof and the number of shares or other units
     covered by all outstanding options, warrants, rights of conversion or
     purchase and similar rights at the date hereof, except for any obligations
     or rights of the Borrower or any of its Subsidiaries to acquire any
     minority interest in any Subsidiary of the Borrower that is a partnership
     or a limited liability company. All of the

     outstanding Equity Interests in each such Subsidiary have (A) (in the case
     of Subsidiaries that are corporations) been validly issued, are fully paid
     and non-assessable and are (B) to the extent owned by the Borrower or one
     or more of its Subsidiaries, free and clear of all Liens, except those
     created under the Collateral Documents or Permitted Liens.

          (c) The execution, delivery and performance by each Loan Party of each
     Loan Document to which it is or is to be a party, and the consummation of
     the Transaction, are within such Loan Party's corporate, partnership or
     limited liability company powers, as applicable, have been duly authorized
     by all necessary corporate, partnership or limited liability company
     action, as applicable, and do not (i) contravene such Loan Party's
     Constitutive Documents, (ii) violate any Requirements of Law, (iii)
     conflict with or result in the breach of, or constitute a default or
     require any payment to be made under, any material contract, loan
     agreement, indenture, mortgage, deed of trust, lease or other instrument
     binding on or affecting any Loan Party or any of its properties or (iv)
     except for the Liens created under the Loan Documents, result in or require
     the creation or imposition of any Lien upon or with respect to any of the
     properties of any Loan Party. No Loan Party is in violation of any such
     Requirements of Law or in breach of any such contract, loan agreement,
     indenture, mortgage, deed of trust, lease or other instrument, the
     violation or breach of which would be reasonably likely to have a Material
     Adverse Effect.

          (d) No Governmental Authorization, and no other authorization or
     approval or other action by, and no notice to or filing with, any
     Governmental Authority or any other third party is required for (i) the due
     execution, delivery, recordation, filing or performance by any Loan Party
     of any Loan Document to which it is or is to be a party, or for the
     consummation of the Transaction, (ii) the grant by any Loan Party of the
     Liens granted by it pursuant to the Collateral Documents, (iii) the
     perfection or maintenance of the Liens created under the Collateral
     Documents on such of the Collateral located in the United States in which a
     Lien may be perfected by the filing of financing statements, the
     recordation of security agreements with the U.S. Patent and Trademark
     Office or the U.S. Copyright Office or the delivery of Collateral
     (including the first priority nature thereof) or (iv) the exercise by any
     Agent or any Lender Party of its rights under the Loan Documents or the
     remedies in respect of the Collateral pursuant to the Collateral Documents,
     except for (A) the authorizations, approvals, filings and actions on
     Schedule 4.01(d) hereto, all of which have been duly obtained and are in
     full force and effect or will be obtained and in full force and effect
     prior to the Initial Extension of Credit, (B) filings, notices, recordings
     and other similar actions necessary for the creation or perfection of the
     Liens and security interests contemplated by the Loan Documents and (C) the
     actions required by laws generally with respect to the exercise by secured
     creditors of their rights and remedies. All applicable waiting periods in
     connection with the Transaction have expired without any action having been
     taken by any competent authority restraining, preventing or imposing
     materially adverse conditions upon the Transaction or the rights of the
     Loan Parties or their Subsidiaries freely to transfer or otherwise dispose
     of, or to create any Lien on, any properties now owned or hereafter
     acquired by any of them.

          (e) This Agreement has been, and each other Loan Document when
     delivered hereunder will have been, duly executed and delivered by each
     Loan Party thereto. This Agreement is, and each other Loan Document when
     delivered hereunder will be, the legal, valid and binding obligation of
     each Loan Party thereto, enforceable against such Loan Party in accordance
     with its terms.

          (f) There is no action, suit, investigation, litigation or proceeding
     affecting any Loan Party or any of its Subsidiaries, including any
     Environmental Action, pending or, to the knowledge of the Borrower,
     threatened before any Governmental Authority or arbitrator that (i)

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     could be reasonably likely to have a Material Adverse Effect or (ii)
     purports to affect the legality, validity or enforceability of any Loan
     Document or the consummation of the Transaction, except as described on
     Schedule 4.01(f) hereto or disclosed prior to the Closing Date in the
     Borrower's filings made with the Securities and Exchange Commission.

          (g) (i) The Consolidated balance sheet of the Borrower and its
     Subsidiaries as at December 31, 2001, and the related Consolidated
     statement of income and Consolidated statement of cash flows of the
     Borrower and its Subsidiaries for the fiscal year then ended, accompanied
     by an unqualified opinion of KPMG LLP, independent public accountants,
     copies of which have been furnished to each Lender Party, fairly present
     the Consolidated financial condition of the Borrower and its Subsidiaries
     as at such date and the Consolidated results of operations of the Borrower
     and its Subsidiaries for the period ended on such date, all in accordance
     with generally accepted accounting principles applied on a consistent
     basis, and (ii)since December 31, 2001, there has been no Material Adverse
     Change.

          (h) The Consolidated forecasted balance sheet, statement of income and
     statement of cash flows of the Borrower and its Subsidiaries delivered to
     the Lender Parties pursuant to Section 3.01(a)(ix) or Section 5.03 were
     prepared in good faith on the basis of the assumptions stated therein,
     which assumptions were believed to be 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 best estimate of its future financial
     performance.

          (i) Neither the Information Memorandum nor any other information,
     exhibit or report furnished by any Loan Party to any Agent or any Lender
     Party in connection with the negotiation and syndication of the Loan
     Documents or pursuant to the terms of the Loan Documents contained any
     untrue statement of a material fact or omitted to state a material fact
     necessary to make the statements made therein not misleading.

          (j) The Borrower is not engaged in the business of extending credit
     for the purpose of purchasing or carrying Margin Stock, and no proceeds of
     any Advance or drawings under any Letter of Credit will be used to purchase
     or carry any Margin Stock or to extend credit to others for the purpose of
     purchasing or carrying any Margin Stock, except for the purchase by the
     Borrower of its common stock as contemplated in Sections 5.02(g)(v) and
     (vi).

          (k) Neither any Loan Party nor any of its Subsidiaries is an
     "investment company", or an "affiliated person" of, or "promoter" or
     "principal underwriter" for, an "investment company", as such terms are
     defined in the Investment Company Act of 1940, as amended. Neither any Loan
     Party nor any of its Subsidiaries is a "holding company", or a "subsidiary
     company" of a "holding company", or an "affiliate" of a "holding company"
     or of a "subsidiary company" of a "holding company", as such terms are
     defined in the Public Utility Holding Company Act of 1935, as amended.
     Neither the making of any Advances, nor the issuance of any Letters of
     Credit, nor the application of the proceeds or repayment thereof by the
     Borrower, nor the consummation of the other transactions contemplated by
     the Loan Documents and Related Documents, will violate any provision of any
     such Act or any rule, regulation or order of the Securities and Exchange
     Commission thereunder.

          (l) Upon making of the filings and taking of the other actions
     necessary to create, perfect and protect the security interest in the
     Collateral created under the Collateral Documents, the Collateral Documents
     create in favor of the Administrative Agent for the benefit of the Secured
     Parties a valid and, together with such filings and other actions,
     perfected first priority security interest in the Collateral, securing the
     payment of the Secured Obligations, subject to

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     Permitted Liens. The Loan Parties are the legal and beneficial owners of
     the Collateral free and clear of any Lien, except for the liens and
     security interests created or permitted under the Loan Documents.

          (m) Each Loan Party is, individually and together with its
     Subsidiaries, Solvent.

          (n)  (i) No ERISA Event has occurred or is reasonably expected to
          occur with respect to any Plan that has resulted in or is reasonably
          expected to result in a material liability of any Loan Party or any
          ERISA Affiliate.

               (ii) Schedule B (Actuarial Information) to the most recent annual
          report (Form 5500 Series) for each Plan, copies of which have been
          filed with the Internal Revenue Service and furnished to the Lender
          Parties, is complete and accurate and fairly presents the funding
          status of such Plan, and since the date of such Schedule B there has
          been no material adverse change in such funding status.

               (iii) Neither any Loan Party nor any ERISA Affiliate has incurred
          or is reasonably expected to incur any Withdrawal Liability exceeding
          $100,000 to any Multiemployer Plan.

               (iv) Neither any Loan Party nor any ERISA Affiliate has been
          notified by the sponsor of a Multiemployer Plan that such
          Multiemployer Plan is in reorganization or has been terminated, within
          the meaning of Title IV of ERISA, and no such Multiemployer Plan is
          reasonably expected to be in reorganization or to be terminated,
          within the meaning of Title IV of ERISA.

          (o) Except as described on Schedule 4.01(o) hereto:

               (i) The operations and properties of each Loan Party comply in
          all material respects with all applicable Environmental Laws and
          Environmental Permits, except where any such failure to comply would
          not be reasonably expected to have a Material Adverse Effect, all past
          non-compliance with such Environmental Laws and Environmental Permits
          has been resolved without ongoing obligations or costs, except where
          any such failure to comply would not be reasonably expected to have a
          Material Adverse Effect and, to Borrower's knowledge, no circumstances
          exist that could be reasonably likely to (A) form the basis of an
          Environmental Action against any Loan Party or any of their properties
          that could have a Material Adverse Effect or (B) cause any such
          property to be subject to any restrictions on ownership, occupancy,
          use or transferability under any Environmental Law.

               (ii) None of the properties currently or, to Borrower's
          knowledge, formerly owned or operated by any Loan Party is listed or
          proposed for listing on the NPL or on the CERCLIS or any analogous
          foreign, state or local list or, to Borrower's knowledge, is adjacent
          to any such property; and except to the extent that any of the
          following would not have a Material Adverse Effect, (A) there are no
          and, to Borrower's knowledge, never have been any underground or
          aboveground storage tanks or any surface impoundments, septic tanks,
          pits, sumps or lagoons in which Hazardous Materials are being or have
          been treated, stored or disposed on any property currently owned or
          operated by any Loan Party or, to its knowledge, on any property
          formerly owned or operated by any Loan Party, (B) there is no asbestos
          or asbestos-containing material on any property currently owned or
          operated by any Loan Party, and (C) Hazardous

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          Materials have not been released, discharged or disposed of on any
          property currently or, to Borrower's knowledge, formerly owned or
          operated by any Loan Party except in compliance with Environmental
          Laws.

               (iii) No Loan Party is undertaking, and has not completed, either
          individually or together with other potentially responsible parties,
          any 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 operated by any Loan
          Party have been disposed of in a manner not reasonably expected to
          result in liability to any Loan Party that, individually or in the
          aggregate, would have a Material Adverse Effect.

          (p) Each Loan Party and each of its Affiliates has filed, has caused
     to be filed or has been included in all tax returns (Federal, state, local
     and foreign) required to be filed and has paid all taxes shown thereon to
     be due, together with applicable interest and penalties. Set forth on
     Schedule 4.01(p) hereto is a complete and accurate list, as of the date
     hereof, of each Open Year of each Loan Party and each of its Affiliates.
     The aggregate unpaid amount, as of the date hereof, of adjustments to the
     Federal income tax liability of each Loan Party and each of its Affiliates
     proposed by the Internal Revenue Service with respect to Open Years does
     not exceed $62,500,000. No issues have been raised by the Internal Revenue
     Service in respect of Open Years that, in the aggregate, could be
     reasonably likely to have a Material Adverse Effect.

          (q) Set forth on Schedule 4.01(q) hereto is a complete and accurate
     list of all Liens (other than Permitted Liens) on the property or assets of
     any Loan Party, showing as of the date hereof the lienholder thereof, the
     principal amount of the obligations secured thereby and the property or
     assets of such Loan Party subject thereto.

          (r) Set forth on Schedule 4.01(r) hereto is a complete and accurate
     list of all Investments held by any Loan Party on the date hereof, showing
     the amount, obligor or issuer and maturity, if any, thereof.

          (s) Except as set forth on Schedule 4.01(s), the dialysis facilities
     operated by each of the Borrower and its Subsidiaries (the "Dialysis
     Facilities") are qualified for participation in the Medicare programs and
     the Medicaid programs in which they participate (together with their
     respective intermediaries or carriers, the "Government Reimbursement
     Programs") and are entitled to reimbursement under the Medicare program for
     services rendered to qualified Medicare beneficiaries, and comply in all
     material respects with the conditions of participation in all Government
     Reimbursement Programs in which they participate or have participated.
     Except as set forth on Schedule 4.01(s), there is no pending or, to
     Borrower's knowledge, threatened proceeding or investigation by any of the
     Government Reimbursement Programs with respect to (i) the Borrower's or any
     of its Subsidiaries' qualification or right to participate in any
     Government Reimbursement Program in which they participate or have
     participated, (ii) the compliance or non-compliance by the Borrower or any
     of its Subsidiaries with the terms or provisions of any Government
     Reimbursement Program in which they participate or have participated, or
     (iii) the right of the Borrower or any of its Subsidiaries to receive or
     retain amounts received or due or to become due from any Government
     Reimbursement Program in which they participate or have participated, which
     proceeding or investigation, together with all other such proceedings and
     investigations, could reasonably be expected to (x) have a Material

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     Adverse Effect or (y) result in Consolidated net operating revenues for any
     (including any future) four fiscal quarter period of the Borrower
     constituting less than 95% of Consolidated net operating revenues for the
     immediately preceding four fiscal quarter period of the Borrower.

          (t) Neither the Borrower nor any of its Subsidiaries, nor any of their
     respective officers or directors has, on behalf of the Borrower or any of
     its Subsidiaries, knowingly or willfully violated the federal Medicare and
     Medicaid statutes, 42 U.S.C. ss.1320a-7b, or the regulations promulgated
     pursuant to such statutes or related state or local statutes or
     regulations, including but not limited to the following: (i) knowingly and
     willfully making or causing to be made a false statement or representation
     of a material fact in any applications for any benefit or payment; (ii)
     knowingly and willfully making or causing to be made any false statement or
     representation of a material fact for use in determining rights to any
     benefit or payment; (iii) failing to disclose knowledge by a claimant of
     the occurrence of any event affecting the initial or continued right to any
     benefit or payment on its own behalf or on behalf of another, with intent
     to secure such benefit or payment fraudulently; (iv) knowingly and
     willfully soliciting or receiving any remuneration (including any kickback,
     bribe or rebate), directly or indirectly, overtly or covertly, in cash or
     in kind or offering to pay such remuneration (a) in return for referring an
     individual to a Person for the furnishing or arranging for the furnishing
     of any item or service for which payment may be made in whole or in part by
     Medicare, Medicaid or other applicable government payers, or (b) in return
     for purchasing, leasing or ordering or arranging for or recommending the
     purchasing, leasing or ordering of any good, facility, service or item for
     which payment may be made in whole or in part by Medicare, Medicaid or
     other applicable government payers. With respect to this Section, knowledge
     of an individual director or officer of the Borrower or a Subsidiary of any
     of the events described in this Section shall not be imputed to the
     Borrower or such Subsidiary unless such knowledge was obtained or learned
     by the director or officer in his or her official capacity as a director or
     officer of the Borrower or such Subsidiary.

          (u) The subordination provisions of (i) the Subordinated Notes
     Documents, (ii) the Subordinated Notes, (iii) any Subordinated Debt now
     existing or hereafter incurred or assumed by any Loan Party and (iv) any
     guarantee by any Loan Party of any Subordinated Debt will be enforceable
     against the holders thereof, and the Advances and all other monetary
     obligations hereunder and all monetary obligations under the Subsidiary
     Guarantee will constitute "Senior Indebtedness" and "Designated Senior
     Indebtedness" (or any comparable terms) as defined in such provisions.

                                   ARTICLE V

                            COVENANTS OF THE BORROWER

          SECTION 5.01. Affirmative Covenants. So long as any Advance or any
                        ---------------------
     other Obligation of any Loan Party under any Loan Document shall remain
     unpaid, any Letter of Credit shall be outstanding or any Lender Party shall
     have any Commitment hereunder, the Borrower will:

               (a) Compliance with Laws, Etc. Comply, and cause each of its
          Subsidiaries to comply, in all material respects, with all applicable
          Requirements of Law, such compliance to include, without limitation,
          compliance with ERISA and the Racketeer Influenced and Corrupt
          Organizations Chapter of the Organized Crime Control Act of 1970,
          except to the extent that non-compliance could not be reasonably
          expected to result in a Material Adverse Effect.

               (b) Payment of Taxes, Etc. Pay and discharge, and cause each of
          its Subsidiaries to pay and discharge, before the same shall become
          delinquent, (i) all taxes, assessments and

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          governmental charges or levies imposed upon it or upon its property
          and (ii) all lawful claims that, if unpaid, might by law become a Lien
          upon its property; provided, however, that neither the Borrower nor
          any of its Subsidiaries shall be required to pay or discharge any such
          tax, assessment, charge or claim (A) the non-payment or non-discharge
          of which could not be reasonably expected to result in a Material
          Adverse Effect or (B) that is being contested in good faith and by
          proper proceedings and as to which appropriate reserves are being
          maintained, unless and until any Lien resulting therefrom attaches to
          its property and becomes enforceable against its other creditors and
          subjects the property to a substantial risk of forfeiture.

               (c) Compliance with Environmental Laws. Comply, and cause each of
          its Subsidiaries and 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 and cause each of its Subsidiaries to obtain and renew all
          Environmental Permits necessary for its operations and properties; and
          conduct, and cause each of its Subsidiaries to 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, in accordance with the
          requirements of all Environmental Laws; provided, however, that
          neither the Borrower nor any of its 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.

               (d) Maintenance of Insurance. Maintain, and cause each of its
          Subsidiaries to maintain, insurance with responsible and reputable
          insurance companies or associations in such amounts and covering such
          risks as is usually carried by companies engaged in similar businesses
          and owning similar properties in the same general areas in which the
          Borrower or such Subsidiary operates.

               (e) Preservation of Corporate Existence, Etc. Preserve and
          maintain, and cause each of its Subsidiaries to preserve and maintain,
          its existence, legal structure, legal name, rights (charter and
          statutory) and material franchises; provided, however, that neither
          the Borrower nor any of its Subsidiaries shall be required to preserve
          any right, privilege or franchise if the Board of Directors of the
          Borrower or such Subsidiary shall determine that the preservation
          thereof is no longer desirable in the conduct of the business of the
          Borrower or such Subsidiary, as the case may be, and that the loss
          thereof is not disadvantageous in any material respect to the
          Borrower, such Subsidiary or the Lender Parties and any Subsidiary may
          merge with or into or be liquidated into another Subsidiary or the
          Borrower as permitted under Section 5.02(d).

               (f) Visitation Rights. At any reasonable time and from time to
          time, and, unless a Default or an Event of Default shall have occurred
          and be continuing, upon reasonable notice, permit any of the Agents or
          any of the Lender Parties, or any agents or representatives thereof,
          to examine and make copies of and abstracts from the records and books
          of account of, and visit the properties of, the Borrower and any of
          its Subsidiaries, and to discuss the affairs, finances and accounts of
          the Borrower and any of its Subsidiaries with any of their officers or
          directors and with their independent certified public accountants
          (provided that representatives of the Borrower shall be entitled to
          notice of and to participate in any such discussion).

               (g) Keeping of Books. Keep, and cause each of its Subsidiaries to
          keep, proper books of record and account, in which full and correct
          entries shall be made of all financial transactions and the assets and
          business of the Borrower and each such Subsidiary using sound

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          business practices sufficient to permit the preparation of financial
          statements based thereon in accordance with generally accepted
          accounting principles in effect from time to time.

               (h) Maintenance of Properties, Etc. Maintain and preserve, and
          cause each of its Subsidiaries to maintain and preserve, all of its
          properties that are used or useful in the conduct of its business in
          good working order and condition, ordinary wear and tear excepted.

               (i) Transactions with Affiliates. Conduct, and cause each of its
          Subsidiaries to conduct, all transactions otherwise permitted under
          the Loan Documents with any of their Affiliates on terms that are fair
          and reasonable and no less favorable to the Borrower or such
          Subsidiary than it would obtain in a comparable arm's-length
          transaction with a Person not an Affiliate.

               (j) Covenant to Guarantee Obligations and Give Security. Upon (x)
          the formation or acquisition of any new direct or indirect
          Subsidiaries by any Loan Party or (y) the acquisition of any personal
          property or real property fee interests (other than any real property
          fee interest on which the only business conducted by the Borrower or
          any of its Subsidiaries is the operation of a Dialysis Facility and
          services related or incidental thereto) by any Loan Party, which, in
          the judgment of the Administrative Agent, shall not already be subject
          to a perfected first priority security interest in favor of the
          Administrative Agent for the benefit of the Secured Parties, then the
          Borrower shall, in each case at the Borrower's expense:

                    (i) in connection with the formation or acquisition of a
               wholly-owned Domestic Subsidiary, not later than 15 Business Days
               following the last day of the Fiscal Quarter in which such
               formation or acquisition occurs, cause each such Domestic
               Subsidiary, and cause each direct and indirect parent of such
               Domestic Subsidiary (if it has not already done so), to duly
               execute and deliver to the Administrative Agent a guarantee or
               guarantee supplement, in form and substance satisfactory to the
               Administrative Agent, guaranteeing the other Loan Parties'
               obligations under the Loan Documents, and, in connection with the
               formation or acquisition of a Foreign Subsidiary, not later than
               15 Business Days following the last day of the Fiscal Quarter in
               which such formation or acquisition occurs, pledge or, cause its
               respective Subsidiary to pledge, to the Administrative Agent for
               the benefit of the Secured Parties 65% of the Equity Interests in
               such Foreign Subsidiary,

                    (ii) not later than 15 Business Days following the last day
               of the Fiscal Quarter in which such formation or acquisition
               occurs, furnish to the Administrative Agent a description of (A)
               the material personal properties and such real property fee
               interests of such wholly-owned Domestic Subsidiary and (B) such
               property which was not previously subject to such perfected
               security interest, in each case in detail satisfactory to the
               Administrative Agent,

                    (iii) not later than 15 Business Days following the last day
               of the Fiscal Quarter in which such formation or acquisition
               occurs, duly execute and deliver, and cause each such
               wholly-owned Domestic Subsidiary and each direct and indirect
               parent of such wholly-owned Domestic Subsidiary (if it has not
               already done so) to duly execute and deliver, to the
               Administrative Agent pledges, assignments, mortgages, deeds of
               trust, security agreements and security agreement supplements, as
               specified by and in form and substance satisfactory to the
               Administrative Agent, with respect to the Equity Interests in and
               assets of such wholly-owned Domestic Subsidiary and such personal
               property and such real property fee interests,

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                    (iv) not later than 15 Business Days following the last day
               of the Fiscal Quarter in which such formation or acquisition
               occurs, take, and cause such wholly-owned Subsidiary or such
               parent to take, whatever action (including, without limitation,
               the filing of Uniform Commercial Code financing statements, the
               filing of mortgages or deeds of trust, the giving of notices and
               the endorsement of notices on title documents) may be necessary
               or advisable in the opinion of the Administrative Agent to vest
               in the Administrative Agent (or in any representative of the
               Administrative Agent designated by it) valid and subsisting Liens
               on the properties purported to be subject to the pledges,
               assignments, mortgages, deeds of trust, security agreements and
               security agreement supplements delivered pursuant to this Section
               5.01(j), enforceable against all third parties in accordance with
               their terms,

                    (v) not later than 45 days following the last day of the
               Fiscal Quarter in which such formation or acquisition occurs,
               deliver to the Administrative Agent, upon the request of the
               Administrative Agent in its sole discretion, a signed copy of a
               favorable opinion (subject to customary qualifications,
               limitations and exceptions), addressed to the Administrative
               Agent and the other Secured Parties, of counsel for the Loan
               Parties acceptable to the Administrative Agent as to the matters
               contained in clauses (i), (iii) and (iv) above, as to such
               guarantees, guarantee supplements, pledges, assignments,
               mortgages, deeds of trust, security agreements and security
               agreement supplements being legal, valid and binding obligations
               of the respective Loan Party thereto enforceable in accordance
               with their terms, as to the matters contained in clause (iv)
               above, as to such recordings, filings, notices, endorsements and
               other actions being sufficient to create valid perfected Liens on
               such properties, and as to such other matters as the
               Administrative Agent may reasonably request, and

                    (vi) at any time and from time to time, promptly execute and
               deliver any and all further instruments and documents and take
               all such other action as the Administrative Agent may deem
               necessary or desirable in obtaining the full benefits of, or in
               perfecting and preserving the Liens of, such guaranties, pledges,
               assignments, mortgages, deeds of trust, security agreements and
               security agreement supplements.

               (k) Further Assurances.

                    (i) Promptly upon request by any Agent, or any Lender Party
               through the Administrative Agent, correct, and cause each of its
               Subsidiaries promptly to correct, any material defect or error
               that may be discovered in any Loan Document or in the execution,
               acknowledgment, filing or recordation thereof; and

                    (ii) Promptly upon request by any Agent, or any Lender Party
               through the Administrative Agent, do, execute, acknowledge,
               deliver, record, re-record, file, re-file, register and
               re-register any and all such further acts, pledge agreements,
               assignments, financing statements and continuations thereof,
               termination statements, notices of assignment, transfers,
               certificates, assurances and other instruments as any Agent, or
               any Lender Party through the Administrative Agent, may reasonably
               require from time to time in order to (A) carry out more
               effectively the purposes of the Loan Documents, (B) to the
               fullest extent permitted by applicable law, subject any Loan
               Party's properties, assets, rights or interests to the Liens now
               or hereafter intended to be covered by any of the Collateral
               Documents, (C) 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 (D) assure, convey,
               grant, assign, transfer, preserve, protect and confirm

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               more effectively unto the Secured Parties the rights granted or
               now or hereafter intended to be granted to the Secured Parties
               under any Loan Document or under any other instrument executed in
               connection with any Loan Document to which any Loan Party is or
               is to be a party, and cause each of its Subsidiaries to do so.

     SECTION 5.02. Negative Covenants. So long as any Advance or any other
                   ------------------
Obligation of any Loan Party under any Loan Document shall remain unpaid, any
Letter of Credit shall be outstanding or any Lender Party shall have any
Commitment hereunder, the Borrower will not, at any time:

          (a) Liens, Etc. Create, incur, assume or suffer to exist, or permit
     any of its Subsidiaries to create, incur, assume or suffer to exist, any
     Lien on or with respect to any of its properties of any character whether
     now owned or hereafter acquired, or sign or file or suffer to exist, or
     permit any of its Subsidiaries to sign or file or suffer to exist, under
     the Uniform Commercial Code of any jurisdiction, a financing statement that
     names the Borrower or any of its Subsidiaries as debtor, or sign or suffer
     to exist, or permit any of its Subsidiaries to sign or suffer to exist, any
     security agreement authorizing any secured party thereunder to file such
     financing statement, or assign, or permit any of its Subsidiaries to
     assign, any accounts or other right to receive income, except:

               (i) Liens created under the Loan Documents;

               (ii) Permitted Liens;

               (iii) Liens existing on the Closing Date and described on
          Schedule 4.01(q) hereto;

               (iv) Liens upon or in real property or equipment acquired or held
          by the Borrower or any of its Subsidiaries in the ordinary course of
          business to secure the purchase price of such property or equipment or
          to secure Debt incurred solely for the purpose of financing the
          acquisition, construction or improvement of any such property or
          equipment to be subject to such Liens, or Liens existing on any such
          property or equipment at the time of acquisition (other than any such
          Liens created in contemplation of such acquisition that do not secure
          the purchase price), or extensions, renewals or replacements of any of
          the foregoing for the same or a lesser amount; provided, however, that
          (a) such Liens shall be created not more than 180 days after the date
          of acquisition or completion of construction or improvement and (b) no
          such Lien shall extend to or cover any property other than the
          property or equipment being acquired, constructed or improved and any
          attachments thereto and proceeds thereof, and no such extension,
          renewal or replacement shall extend to or cover any property not
          theretofore subject to the Lien being extended, renewed or replaced;
          and provided further that the aggregate principal amount of the Debt
          secured by Liens permitted by this clause (iv) shall not exceed the
          amount permitted under Section 5.02(b)(v) at any time outstanding;

               (v) Liens arising in connection with Capitalized Leases permitted
          under Section 5.02(b)(vi); provided that no such Lien shall extend to
          or cover any Collateral or assets other than the assets subject to
          such Capitalized Leases; and

               (vi) the replacement, extension or renewal of any Lien permitted
          by clause (iii) above upon or in the same property theretofore subject
          thereto or the replacement, extension or renewal (without increase in
          the amount or change in any direct or contingent obligor) of the Debt
          secured thereby.

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          (b) Debt. Create, incur, assume or suffer to exist, or permit any of
     its Subsidiaries to create, incur, assume or suffer to exist, any Debt,
     except:

               (i) Debt under the Loan Documents;

               (ii) Debt existing on the Closing Date and described on Schedule
          5.02(b) hereto;

               (iii) Debt of the Borrower in respect of Hedge Agreements (A)
          existing on the date of this Agreement and described in Schedule
          5.02(b) hereto or (B) entered into from time to time after the date of
          this Agreement with counter parties that are Lender Parties at the
          time such Hedge Agreement is entered into (or Affiliates of such
          Lender Party at such time); and which counter party is then a party to
          the Intercreditor Agreement; provided that, in all cases under this
          clause (iii), all such Hedge Agreements shall not be speculative in
          nature (including, without limitation, with respect to the term and
          purpose thereof);

               (iv) Debt of (A) the Borrower owing to any other Loan Party, and
          (B) any of the Subsidiaries owing to the Borrower or any other Loan
          Party to the extent permitted under Section 5.02(f)(viii);

               (v) Debt incurred after the date of this Agreement and secured by
          Liens expressly permitted under Section 5.02(a)(iv) in an aggregate
          principal amount not to exceed, when aggregated with the principal
          amount of all Debt incurred under clause (vi) of this Section 5.02(b),
          $50,000,000 any time outstanding;

               (vi) Capitalized Leases incurred after the date of this Agreement
          which, when aggregated with the principal amount of all Debt incurred
          under clause (v) of this Section 5.02(b), do not exceed $50,000,000 at
          any time outstanding;

               (vii) Contingent Obligations of (A) the Borrower guaranteeing all
          or any portion of the outstanding Obligations of any of the
          Subsidiaries and (B) any Subsidiary of the Borrower guaranteeing any
          Obligations of the Borrower or another Subsidiary thereof; provided
          that each such primary Obligation is otherwise permitted under the
          terms of the Loan Documents;

               (viii) Unsecured Debt not otherwise permitted under this Section
          5.02(b) in an aggregate amount not to exceed $50,000,000 at any time
          outstanding;

               (ix) Endorsement of negotiable instruments for deposit or
          collection or similar transactions in the ordinary course of business;

               (x) Debt comprised of indemnities given by the Borrower or any of
          its Subsidiaries, or guarantees or other similar undertakings by the
          Borrower or any of its Subsidiaries entered into in lieu thereof, in
          favor of the purchaser of property and assets of the Borrower and its
          Subsidiaries being sold, leased, transferred or otherwise disposed of
          in accordance with this Agreement and covering liabilities incurred by
          the Borrower or its applicable Subsidiary in respect of such property
          and assets prior to the date of consummation of the sale, lease,
          transfer or other disposition thereof, which indemnities, guarantees
          or undertakings are required under the terms of the documentation for
          such sale, lease, transfer or other disposition;

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               (xi) Debt comprised of liabilities or other Obligations assumed
          or retained by the Borrower or any of its Subsidiaries from
          Subsidiaries of the Borrower that are, or all or substantially all of
          the property and assets of which are, sold, leased, transferred or
          otherwise disposed of pursuant to Section 5.02(e)(iii) or (vi);
          provided that such liabilities or other Obligations were not created
          or incurred in contemplation of the related sale, lease, transfer or
          other disposition;

               (xii) Unsecured Subordinated Debt or Redeemable Preferred
          Interests not otherwise permitted under this Section 5.02(b), provided
          that the aggregate amount of the outstanding principal amount of such
          unsecured Subordinated Debt and the maximum amount of the purchase
          price, redemption price or liquidation value (whichever is greater) of
          such Redeemable Preferred Interests does not exceed $400,000,000 at
          any time; provided further, that the Net Cash Proceeds thereof are
          applied to prepay the Advances to the extent provided in Section
          2.06(b); and

               (xiii) Debt extending the maturity of, or refunding, refinancing
          or replacing, in whole or in part, any Debt incurred under clause (ii)
          of this Section 5.02(b); provided, however, that (A) the aggregate
          principal amount of such extended, refunding, refinancing or
          replacement Debt shall not be increased above the principal amount
          thereof and the premium, if any, thereon outstanding immediately prior
          to such extension, refunding, refinancing or replacement, (B) the
          direct and contingent obligors therefor shall not be changed as a
          result of or in connection with such extension, refunding, refinancing
          or replacement, (C) such extended, refunding, refinancing or
          replacement Debt shall not mature prior to the stated maturity date or
          mandatory redemption date of the Debt being so extended, refunded,
          refinanced or replaced, and (D) if the Debt being so extended,
          refunded, refinanced or replaced is subordinated in right of payment
          or otherwise to the Obligations of the Borrower or any of its
          Subsidiaries under and in respect of the Loan Documents, such
          extended, refunding, refinancing or replacement Debt shall be
          subordinated to such Obligations to at least the same extent.

               (xiv) Debt comprised of guarantees given by the Borrower or any
          of its Subsidiaries in respect of any Special Purpose Licensed Entity
          which obligations, when aggregated with the aggregate amount of all
          Investments made under Section 5.02(f)(ix) hereof, shall not exceed
          $20,000,000 at any time.

          (c) Change in Nature of Business. Engage or permit any of its
     Subsidiaries to engage in any business other than the businesses carried on
     at the date hereof and any businesses incidental or related thereto.

          (d) Mergers, Etc. Merge into or consolidate with any Person or permit
     any Person to merge into it, or permit any of its Subsidiaries to do so,
     except that:

               (i) any of the Subsidiaries may merge into or consolidate with
          the Borrower, provided that the Borrower is the surviving corporation;

               (ii) any Subsidiary of the Borrower may merge into or consolidate
          with any other Subsidiary of the Borrower, provided that, in the case
          of any such merger or consolidation involving a wholly-owned
          Subsidiary, the Person formed by or surviving such merger or
          consolidation shall be a wholly-owned Subsidiary of the Borrower,
          provided further that, in the case of any such merger or consolidation
          to which a

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          Subsidiary Guarantor is a party, the Person formed by such merger or
          consolidation shall be a Subsidiary Guarantor;

               (iii) in connection with any purchase or other acquisition of
          Equity Interests in, or property and assets of, any Person permitted
          under Section 5.02(f)(v), the Borrower may permit any other Person to
          merge into or consolidate with it (provided that the Borrower is the
          surviving entity), and any of the Subsidiaries 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
          with which such Subsidiary is merging or consolidating (1) shall be
          engaged in substantially the same lines of business as one or more of
          the businesses of the Borrower and the Subsidiaries or in an
          incidental or related business and (2) shall not have any contingent
          liabilities that could reasonably be expected to be material and
          adverse to the Borrower and its Subsidiaries, taken as a whole (as
          determined in good faith by the board of directors (or persons
          performing similar functions) of the Borrower or such Subsidiary if
          the board of directors is otherwise approving such transaction, and in
          each other case, by a Responsible Officer), and (3) in the case of any
          wholly-owned Domestic Subsidiary, such Person shall take all actions
          required under Section 5.01(j); and

               (iv) in connection with any sale, transfer or other disposition
          of all or substantially all of the Equity Interests in, or the
          property and assets of, any Person permitted under Section
          5.02(e)(vi), any of the Subsidiaries of the Borrower may merge into or
          consolidate with any other Person or permit any other Person to merge
          into or consolidate with it; and

provided, however, that in each case, immediately after giving effect thereto,
no event shall occur and be continuing that constitutes a Default.

          (e) Sales, Etc., of Assets. Sell, lease, transfer or otherwise dispose
     of, or permit any of its Subsidiaries to sell, lease, transfer or otherwise
     dispose of, any assets, or grant any option or other right to purchase,
     lease or otherwise acquire any assets, except:

               (i) the Borrower and its Subsidiaries may sell inventory in the
          ordinary course of business;

               (ii) (A) the Borrower may sell, lease, transfer or otherwise
          dispose of any of its property or assets to any of the Subsidiaries,
          and (B) any of the Subsidiaries may sell, lease, transfer or otherwise
          dispose of any of its property or assets to the Borrower or any of the
          other Subsidiaries; provided that, in each case, no such sale, lease,
          transfer or other disposition to non-wholly-owned Subsidiaries shall
          be made unless, after giving pro forma effect thereto, the Borrower
          and its Subsidiaries would be in compliance with Section 5.02(l) and
          Section 5.04(d);

               (iii) any Subsidiary of the Borrower that is no longer actively
          engaged in any business or activities and does not have property and
          assets with an aggregate book value in excess of $1,000,000 may be
          wound up, liquidated or dissolved so long as such winding up,
          liquidation or dissolution is determined in good faith by management
          of the Borrower to be in the best interests of the Borrower and its
          Subsidiaries;

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<PAGE>

               (iv) the Borrower and its Subsidiaries may sell, lease, transfer
          or otherwise dispose of any obsolete, damaged or worn out equipment
          thereof or any other equipment that is otherwise no longer useful in
          the conduct of their businesses;

               (v) the Borrower and its Subsidiaries may lease or sublease real
          property to the extent required for their respective businesses and
          operations in the ordinary course so long as such lease or sublease is
          not otherwise prohibited under the terms of the Loan Documents;

               (vi) the Borrower and its Subsidiaries may sell, lease, transfer
          or otherwise dispose of property and assets not otherwise permitted to
          be sold, leased, transferred or disposed of pursuant to this Section
          5.02(e) so long as the aggregate book value of all of the property and
          assets of the Borrower and its Subsidiaries sold, leased, transferred
          or otherwise disposed of pursuant to this clause (vi) does not exceed
          $300,000,000 in the aggregate during the term of this Agreement;
          provided that:

                    (A) the gross proceeds received from any such sale, lease,
               transfer or other disposition shall be at least equal to the fair
               market value of the property and assets so sold, leased,
               transferred or otherwise disposed of, determined at the time of
               such sale, lease, transfer or other disposition;

                    (B) at least 75% of the value of the aggregate consideration
               received from any such sale, lease, transfer or other disposition
               shall be in cash, provided, that up to one-third of such 75% may
               consist of notes or other obligations received by the Borrower or
               such Subsidiary that are due and payable or otherwise converted
               by the Borrower or such Subsidiary into cash within 365 days of
               receipt, which cash (to the extent received) shall constitute Net
               Cash Proceeds attributable to the original transaction; and
               provided further that any Debt of the Borrower or any of its
               Subsidiaries (as shown on the Borrower's or such Subsidiary's
               most recent balance sheet) that is assumed by the transferee of
               any such assets shall constitute cash for purposes of this
               Section 5.02(e)(vi), so long as the Borrower and all of its
               Subsidiaries are fully and unconditionally released therefrom;

                    (C) immediately before and immediately after giving pro
               forma effect to any such sale, lease, transfer or other
               disposition, no Default shall have occurred and be continuing,
               and

                    (D) within fifteen Business Days after each disposition
               under this subsection, the Borrower shall deliver to the
               Administrative Agent, on behalf of the Lender Parties, a
               certificate identifying the property disposed of and stating (a)
               that immediately before and after giving effect thereto, no
               Default or Event or Default existed, (b) that the consideration
               received or to be received by the Borrower or such Subsidiary for
               such property has been determined by the Borrower or the
               applicable Subsidiary to be not less than the fair market value
               of such property and (c) the total consideration to be paid in
               respect of such disposition and (d) the Net Cash Proceeds
               resulting from such disposition; and

                    (E) if and to the extent that the Net Cash Proceeds of any
               transaction effected pursuant to this Section 5.02(e)(vi) shall
               not have been reinvested in assets or property of the Borrower or
               any of its Subsidiaries with respect to any

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<PAGE>

               transaction completed (1) on or prior to December 31, 2002, by
               December 27, 2003 and (2) thereafter, within 360 days after the
               date of receipt thereof, then such uninvested Net Cash Proceeds
               shall be applied on the first Business Day following December 27,
               2003 or the applicable 360-day period, as the case may be, to
               prepay Advances in accordance with Section 2.06(b); and

               (vii) the Borrower and its Subsidiaries may exchange assets and
          properties with another Person; provided that:

                    (A) the assets or properties received by the Borrower or its
               Subsidiaries shall be used in the business of the Borrower or
               such Subsidiary as conducted immediately prior to such
               transaction, or in an incidental or related business;

                    (B) the total consideration received by the Borrower or such
               Subsidiary for such assets or property shall have been determined
               by the Borrower or such Subsidiary to be not less than the fair
               market value of the assets or property exchanged;

                    (C) immediately before and immediately after giving pro
               forma effect to any such exchange, no Default shall have occurred
               and be continuing;

                    (D) any cash received by the Borrower or any such Subsidiary
               in connection with such exchange shall be treated as Net Cash
               Proceeds subject to Section 2.06(b) and any cash paid by the
               Borrower or any Subsidiary in connection with such exchange shall
               be treated as an acquisition expenditure under Section
               5.02(f)(v); and

                    (E) within fifteen Business Days after each exchange under
               this Section 5.02(e)(vii), the Borrower shall deliver to the
               Administrative Agent, on behalf of the Lender Parties, a
               certificate identifying the assets or property disposed of and
               acquired in such exchange, and stating (a) that immediately
               before and after giving effect thereto, no Default or Event or
               Default existed, (b) that the total consideration received by the
               Borrower or such Subsidiary for such assets or property has been
               determined by the Borrower or such Subsidiary to be not less than
               the fair market value of the assets or property exchanged, and
               (c) the amount, if any, of the cash paid or Net Cash Proceeds
               received in connection with such exchange.

          (f) Investments in Other Persons. Make or hold, or permit any of its
     Subsidiaries to make or hold, any Investment in any Person, except:

               (i) Investments by the Borrower and its Subsidiaries in Cash
          Equivalents;

               (ii) Investments existing on the Closing Date and described on
          Schedule 4.01(r) hereto;

               (iii) Investments by the Borrower in Hedge Agreements permitted
          under Section 5.02(b) (iii);

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<PAGE>

               (iv) Investments in accounts and notes payable in the ordinary
          course of business, including notes received in transactions permitted
          under Section 5.02(e)(vi);

               (v) the purchase or other acquisition of (1) Equity Interests in
          any Domestic Person that, upon the consummation thereof, will be more
          than 50% owned by the Borrower or one or more of its wholly owned
          Subsidiaries (including, without limitation, as a result of a merger
          or consolidation) or (2) all or substantially all the property and
          assets of a Person or consisting of a line of business or business
          unit of a Person; provided that, with respect to each purchase or
          other acquisition made pursuant to this clause (v):

                    (A) the lines of business of the Person to be (or the
               property and assets of which are to be) so purchased or otherwise
               acquired shall be substantially the same lines of business as one
               or more of the businesses of the Borrower and its Subsidiaries or
               a business that is incidental or related thereto;

                    (B) such purchase or other acquisition shall not include or
               result in any contingent liabilities that could reasonably be
               expected to be material and adverse to the business, financial
               condition, operations or prospects of the Borrower and its
               Subsidiaries, taken as a whole (as determined in good faith by
               the board of directors (or the persons performing similar
               functions) of the Borrower or such Subsidiary if the board of
               directors is otherwise approving such transaction and, in each
               other case, by a Responsible Officer);

                    (C) the total cash consideration (excluding all Equity
               Interests issued or transferred to the sellers thereof but
               including the aggregate amounts paid or to be paid under deferred
               purchase price, noncompete, consulting and other similar
               agreements with the sellers thereof and all assumptions of debt,
               liabilities and other obligations in connection therewith) paid
               by or on behalf of the Borrower and its Subsidiaries (1) for any
               such purchase or other acquisition (or any series of related
               purchases or acquisitions) shall not exceed $50,000,000 unless
               such purchase or acquisition has been approved by the Required
               Lenders, and (2) for all such purchases or acquisitions effected
               during the term of this Agreement shall not exceed $200,000,000;
               provided that such amount shall be increased to $400,000,000 at
               all times after the Leverage Ratio is less than or equal to
               2.75:1.00;

                    (D) (1) immediately before and immediately after giving pro
               forma effect to any such purchase or other acquisition, no
               Default shall have occurred and be continuing and (2) immediately
               after giving effect to such purchase or other acquisition, the
               Borrower and its Subsidiaries shall be in pro forma compliance
               with all of the covenants set forth in Section 5.04, such
               compliance to be determined on the basis of the Required
               Financial Information most recently delivered to the
               Administrative Agent and the Lender Parties as though such
               purchase or other acquisition had been consummated as of the
               first day of the fiscal period covered thereby; and

                    (E) the Borrower shall have delivered to the Administrative
               Agent, on behalf of the Lender Parties, at least three Business
               Days prior to the date on which any such purchase or other
               acquisition in which the total cash consideration is more than
               $30,000,000 is to be consummated, a certificate of a

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<PAGE>

               Responsible Officer, in form and substance reasonably
               satisfactory to the Administrative Agent, certifying that all of
               the requirements set forth in this clause (v) have been satisfied
               or will be satisfied on or prior to the consummation of such
               purchase or other acquisition;

               (vi) Investments by the Borrower or any Subsidiary in 50% or less
          of the Equity Interests in another Person (the "Minority Investment"),
          provided that (i) the Borrower or any Subsidiary owns at least 20% (on
          a fully diluted basis) of the issued and outstanding Equity Interests
          in such Person, (ii) the aggregate outstanding amount of Minority
          Investments made by the Borrower and any Subsidiary shall not exceed
          $60,000,000 at any one time, (iii) the Borrower or any Subsidiary
          shall have full control over all bank accounts of such Person if the
          Borrower or any Subsidiary is the largest holder of Equity Interests
          in such Person, (iv) the Borrower or any Subsidiary shall control or
          act as the managing general partner of such Person if such Person is a
          partnership and if the Borrower or any Subsidiary is the largest
          holder of Equity Interests in such Person, and (v) immediately before
          and after giving effect thereto, no Default or Event of Default shall
          exist;

               (vii) notes from employees issued to the Borrower representing
          payment for capital stock of the Borrower or representing payment of
          the exercise price of options to purchase capital stock of the
          Borrower, and employee relocation expenses incurred in the ordinary
          course of business, in an aggregate amount at any time outstanding not
          to exceed $10,000,000;

               (viii) Investments of the Borrower or any of its Subsidiaries in
          any Subsidiary of the Borrower; provided that no such Investments in
          non-wholly-owned Subsidiaries shall be made unless, after giving pro
          forma effect thereto, the Borrower and its Subsidiaries would be in
          compliance with Section 5.02(l) and Section 5.04(d); and

               (ix) Investments of the Borrower or any of its Subsidiaries in
          any Special Purpose Licensed Entity which, when aggregated with the
          aggregate amount of all obligations guaranteed under Section
          5.02(b)(xiv) hereof, shall not exceed $20,000,000 at any time.

          (g) Restricted Payments. Declare or pay any dividends, purchase,
     redeem, retire, defease or otherwise acquire for value any of its Equity
     Interests now or hereafter outstanding, return any capital to its
     stockholders, partners or members (or the equivalent Persons thereof) as
     such, make any distribution of assets, Equity Interests, obligations or
     securities to its stockholders, partners or members (or the equivalent
     Persons thereof) as such, or permit any of its Subsidiaries to do any of
     the foregoing, or permit any of its Subsidiaries to purchase, redeem,
     retire, defease or otherwise acquire for value any Equity Interests in the
     Borrower, 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:

               (i) the Borrower may (A) declare and pay dividends and
          distributions payable only in its common Equity Interests, (B) except
          to the extent the Net Cash Proceeds thereof are required to be applied
          to the prepayment of the Advances pursuant to Section 2.06(b),
          purchase, redeem, retire, defease or otherwise acquire Equity
          Interests with the proceeds received contemporaneously from the issue
          of new Equity Interests with equal or inferior voting powers,
          designations, preferences and rights, and (C) repurchase its Equity
          Interests owned by management or employees and physicians under

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<PAGE>

          contract with the Borrower or any of its Subsidiaries in an amount not
          in excess of $10,000,000 in any twelve month period;

               (ii) any Subsidiary of the Borrower may (A) declare and pay cash
          dividends to the Borrower, and (B) declare and pay cash dividends to
          any other Loan Party of which it is a Subsidiary;

               (iii) any of the non-wholly owned Subsidiaries of the Borrower
          may declare and pay or make dividends and other distributions to its
          shareholders, partners or members (or the equivalent persons thereof)
          generally so long as the Borrower and each of the Subsidiaries that
          own any of the Equity Interests therein receive at least their
          respective proportionate shares of any such dividend or distribution
          (based upon their relative holdings of the Equity Interests therein
          and taking into account the relative preferences, if any, of the
          various classes of the Equity Interests therein);

               (iv) purchase, redeem or otherwise acquire for value any of the
          subordinated notes referred to in clause (i) or (ii) of the definition
          of "Subordinated Notes", provided that (1) immediately prior to each
          such transaction and after giving effect thereto the aggregate amount
          of the Unused Revolving Credit Commitment is not less than
          $75,000,000, and (2) at the time of each such transaction and
          immediately after giving pro forma effect to each such transaction the
          Senior Leverage Ratio is less than 2.50:1.00;

          [DELETE]

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          (h) Accounting Changes. Make or permit, or permit any of its
     Subsidiaries to make or permit, any change in (i) accounting policies or
     reporting practices, except as allowed by generally accepted accounting
     principles, or (ii) Fiscal Year.

          (i) Prepayments, Etc., of Subordinated Debt. Except as permitted under
     Section 5.02(g)(iv) or (vi) and except for the purchase of the 2001
     Subordinated Notes, including those purchased pursuant to an Offer to
     Purchase and Consent Solicitation dated March 21, 2002, (i) 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 Subordinated Debt, or give any notice in
     respect thereof, or (ii) amend, modify or change in any manner any term or
     condition of any of the Subordinated Notes Documents, or permit any of its
     Subsidiaries to do any of the foregoing, except that if such Subordinated
     Debt is convertible into common stock of the Borrower, the Borrower,
     subject to the approval of the Administrative Agent (which approval shall
     not unreasonably be withheld), may give notice with respect thereof if the
     purpose of such notice is to force the holders of such Subordinated Debt to
     convert such Subordinated Debt into common stock of the Borrower and
     thereafter the Borrower may exercise any right it may have to so redeem all
     or any part of such Subordinated Debt.

          (j) Negative Pledge. Enter into or suffer to exist, or permit any of
     its Subsidiaries to enter into or suffer to exist, any agreement
     prohibiting or conditioning the creation or assumption of any Lien upon any
     of its property or assets except (i) in favor of the Secured Parties or
     (ii) in connection with (A) any Debt permitted by Section 5.02(b)(v) solely
     to the extent that the agreement or instrument governing such Debt
     prohibits a Lien on the property acquired with the proceeds of such Debt,
     or (B) any Capitalized Lease permitted by Section 5.02(b)(vi) solely to the
     extent that such Capitalized Lease prohibits a Lien on the property subject
     thereto, or (C) any Debt outstanding on the date any Subsidiary of the
     Borrower becomes such a Subsidiary (so long as such agreement was not
     entered into solely in contemplation of such Subsidiary becoming a
     Subsidiary of the Borrower), or (D) solely with respect to Subsidiaries
     that are not Guarantors, restrictions contained in the Constitutive
     Documents of such Subsidiaries.

          (k) Payment Restrictions Affecting Subsidiaries. Directly or
     indirectly, enter into or suffer to exist, or permit any of its
     Subsidiaries to enter into or suffer to exist, any agreement or arrangement
     limiting the ability of any of its Subsidiaries to declare or pay dividends
     or other distributions in respect of its Equity Interests or repay or
     prepay any Debt owed to, make loans or advances to, or otherwise transfer
     assets to or invest in, the Borrower or any Subsidiary of the Borrower
     (whether through a covenant restricting dividends, loans, asset transfers
     or investments, a financial covenant or otherwise), except (i) the Loan
     Documents, (ii) any agreement in effect at the time such Subsidiary becomes
     a Subsidiary of the Borrower, so long as such agreement was not entered
     into solely in contemplation of such Person becoming a Subsidiary of the
     Borrower, (iii) restrictions on transfer contained in Debt incurred
     pursuant to Sections 5.02(b)(v) and (vi); provided, that such restrictions
     relate only to the transfer of the property financed with such Debt; (iv)
     in connection with and pursuant to refinancing Debt under Section
     5.02(b)(xiii), replacements of restrictions that are not more restrictive
     than those being replaced and do not apply to any other

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     Person or assets than those that would have been covered by the
     restrictions in the Debt so refinanced; and (v) solely with respect to
     Subsidiaries that are not Guarantors, restrictions under the Constitutive
     Documents governing such Subsidiary: (A) with respect to existing
     Subsidiaries, existing on the date of this Agreement; and (B) with respect
     to Subsidiaries created or acquired after the date of this Agreement: (1)
     prohibiting such Subsidiary from guaranteeing Debt of the Borrower or
     another Subsidiary; (2) on dividend payments and other distributions solely
     to permit pro rata dividends and other distributions in respect of any
     Equity Interests of such Subsidiary; (3) limiting transactions with the
     Borrower or another Subsidiary to those with terms that are fair and
     reasonable to such Subsidiary and no less favorable to such Subsidiary than
     could have been obtained in an arm's length transaction with an unrelated
     third party; and (vi) encumbrances or restrictions (A) that restrict in a
     customary manner the subletting, assignment or transfer of any property or
     asset that is subject to a lease, license or similar contract entered into
     in the ordinary course of business, or the assignment or transfer of any
     lease, license or contract entered into in the ordinary course of business
     and (B) arising by virtue of any transfer of, agreement to transfer, option
     or right with respect to, or Lien on, any property or assets of the
     Borrower or any Subsidiary.

          (l) Non-Wholly-Owned Subsidiaries. Permit at any time (x) the
     aggregate total assets (calculated without duplication) at such time of all
     Subsidiaries of the Borrower formed or acquired after April 30, 1998 that
     are not Guarantors, plus (y) the aggregate total Investments made during
     the period from April 30, 1998 to such time (calculated without duplication
     and excluding Investments made pursuant to Section 5.02(f)(vi) to the
     extent the proceeds thereof were used to acquire Equity Interests or assets
     included in (x) above) by the Loan Parties in all Subsidiaries of the
     Borrower that are not Guarantors, less (z) the aggregate total assets at
     such time of all Subsidiaries of the Borrower existing on April 30, 1998
     that became Guarantors after April 30, 1998, to exceed 10% of the
     Consolidated total assets of the Borrower and its Subsidiaries.

          (m) Issuance of Additional Stock. Permit any of its Subsidiaries to
     issue any additional Equity Interests, except as follows:

               (i) in connection with a permitted Investment or to employees or
          consultants in the ordinary course of business;

               (ii) the Borrower and any Subsidiary thereof may organize new
          wholly-owned Subsidiaries and any Subsidiary may issue additional
          Equity Interests to the Borrower or to a wholly-owned Subsidiary of
          the Borrower;

               (iii) subject to compliance with the provisions this Agreement,
          including Section 5.02(1) and Section 5.04(d), the Borrower and its
          Subsidiaries may (A) organize new non-wholly-owned Subsidiaries, and
          (B) (i) cause Subsidiaries to issue additional Equity Interests or
          (ii) sell outstanding Equity Interests therein, in each case to
          Persons other than Affiliates of the Borrower or its Subsidiaries.

     SECTION 5.03. Reporting Requirements. So long as any Advance or any other
                   ----------------------
Obligation of any Loan Party under any Loan Document shall remain unpaid, any
Letter of Credit shall be outstanding or any Lender Party shall have any
Commitment hereunder, the Borrower will furnish to the Administrative Agent (for
distribution to the agents and Lender Parties):

          (a) Default Notice. As soon as possible and in any event within five
     days after the Borrower knows or reasonably should have known of the
     occurrence of a Default or any event,

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     development or occurrence reasonably likely to have a Material Adverse
     Effect continuing on the date of such statement, a statement of the chief
     financial officer of the Borrower setting forth details of such Default or
     other event, development or occurrence and the action that the Borrower has
     taken and proposes to take with respect thereto.

          (b) Annual Financials. As soon as available and in any event within 90
     days after the end of each Fiscal Year, a copy of the annual audit report
     for such year for the Borrower and its Subsidiaries, including therein
     Consolidated and consolidating balance sheets of the Borrower and its
     Subsidiaries as of the end of such Fiscal Year and a Consolidated and
     consolidating statements of income and a Consolidated statement of cash
     flows of the Borrower and its Subsidiaries for such Fiscal Year, in each
     case accompanied by an unqualified opinion of KPMG LLP or other independent
     public accountants of recognized national standing, together with (i) a
     certificate of such accounting firm to the Lender Parties stating that in
     the course of the regular audit of the business of the Borrower and its
     Subsidiaries, which audit was conducted by such accounting firm in
     accordance with generally accepted auditing standards, such accounting firm
     has obtained no knowledge that a Default has occurred and is continuing, or
     if, in the opinion of such accounting firm, a Default has occurred and is
     continuing, a statement as to the nature thereof, (ii) a schedule in form
     satisfactory to the Administrative Agent of the computations used by such
     accountants in determining, as of the end of such Fiscal Year, compliance
     with the covenants contained in Section 5.04, provided that in the event of
     any change in generally accepted accounting principles used in the
     preparation of such financial statements, the Borrower shall also provide,
     if necessary for the determination of compliance with Section 5.04 from
     GAAP, a statement of reconciliation conforming such financial statements to
     GAAP and (iii) a certificate of the Chief Financial Officer of the Borrower
     stating that to the best of such officer's knowledge, no Default has
     occurred and is continuing or, if a Default has occurred and is continuing,
     a statement as to the nature thereof and the action that the Borrower has
     taken and proposes to take with respect thereto.

          (c) Quarterly Financials. As soon as available and in any event within
     45 days after the end of each of the first three quarters of each Fiscal
     Year, Consolidated and consolidating balance sheets of the Borrower and its
     Subsidiaries as of the end of such quarter and Consolidated and
     consolidating statements of income for the period commencing at the end of
     the previous fiscal quarter and ending with the end of such fiscal quarter
     and Consolidated and consolidating statements of income and a Consolidated
     statement of cash flows of the Borrower and its Subsidiaries for the period
     commencing at the end of the previous Fiscal Year and ending with the end
     of such quarter, setting forth in each case in comparative form the
     corresponding figures for the corresponding date or period of the preceding
     Fiscal Year, all in reasonable detail and duly certified (subject to normal
     year-end audit adjustments) by the Chief Financial Officer of the Borrower
     as having been prepared in accordance with generally accepted accounting
     principles (except that such financial statements may not contain all
     required notes and may be subject to year end audit adjustments), together
     with (i) a certificate of said officer stating that to the best of such
     officer's knowledge, no Default has occurred and is continuing or, if a
     Default has occurred and is continuing, a statement as to the nature
     thereof and the action that the Borrower has taken and proposes to take
     with respect thereto, (ii) a schedule in form satisfactory to the
     Administrative Agent of the computations used by the Borrower in
     determining compliance with the covenants contained in Section 5.04,
     provided that in the event of any change in generally accepted accounting
     principles used in the preparation of such financial statements as compared
     to GAAP, the Borrower shall also provide, if necessary for the
     determination of compliance with Section 5.04, a statement of
     reconciliation conforming such financial statements to GAAP, and (iii) a
     report (in a form satisfactory to the Administrative Agent) specifying all
     permitted

                                       80

<PAGE>

     Investments made during such quarter and during the period from the date
     hereof to the end of such quarter and specifying the total consideration
     paid with respect to each such Investment.

          (d) Annual Forecasts. As soon as available and in any event no later
     than 30 days after the end of each Fiscal Year, forecasts prepared by
     management of the Borrower, in form satisfactory to the Administrative
     Agent, of Consolidated balance sheets, income statements and cash flow
     statements of the Borrower and its Subsidiaries on a quarterly basis for
     the Fiscal Year following such Fiscal Year and on an annual basis for each
     Fiscal Year thereafter until the Termination Date.

          (e) Litigation. (i) Promptly after the commencement thereof, notice of
     all actions, suits, investigations, litigation and proceedings before any
     Governmental Authority or arbitrator, affecting any Loan Party or any of
     its Subsidiaries of the type described in Section 4.01(f), and promptly
     after the occurrence thereof, notice of any material adverse change in the
     status or the financial effect on any Loan Party or any of its Subsidiaries
     of the litigation from that described on Schedule 4.01(f) hereto, and (ii)
     prompt written notice of: (A) any citation, summons, subpoena, order to
     show cause or other document naming the Borrower or any of its Subsidiaries
     a party to any proceeding before any Governmental Authority that could
     reasonably be expected to have a Material Adverse Effect or that expressly
     calls into question the validity or enforceability of any of the Loan
     Documents, and include with such notice a copy of such citation, summons,
     subpoena, order to show cause or other document, (B) any lapse or other
     termination of any material intellectual property, license, permit,
     franchise or other authorization issued to the Borrower or any of its
     Subsidiaries by any Person or Governmental Authority, or (C) any refusal by
     any Person or Governmental Authority to renew or extend such material
     intellectual property, license, permit, franchise or other authorization,
     which lapse, termination, refusal or dispute could reasonably be expected
     to have a Material Adverse Effect.

          (f) Securities Reports. Promptly after the sending or filing thereof,
     copies of all proxy statements, financial statements and reports that any
     Loan Party or any of its Subsidiaries sends to its stockholders, and copies
     of all regular, periodic and special reports, and all registration
     statements, that any Loan Party or any of its Subsidiaries files with the
     Securities and Exchange Commission or any governmental authority that may
     be substituted therefor, or with any national securities exchange.

          (g) ERISA.

               (i) ERISA Events and ERISA Reports. (A) Promptly and in any event
          within 10 days after any Loan Party or any ERISA Affiliate knows or
          has reason to know that any ERISA Event has occurred, a statement of
          the Chief Financial Officer of the Borrower describing such ERISA
          Event and the action, if any, that such Loan Party or such ERISA
          Affiliate has taken and proposes to take with respect thereto and (B)
          on the date any records, documents or other information must be
          furnished to the PBGC with respect to any Plan pursuant to Section
          4010 of ERISA, a copy of such records, documents and information.

               (ii) Plan Terminations. Promptly and in any event within two
          Business Days after receipt thereof by any Loan Party or any ERISA
          Affiliate, copies of each notice from the PBGC stating its intention
          to terminate any Plan or to have a trustee appointed to administer any
          Plan.

                                       81

<PAGE>

               (iii) Plan Annual Reports. Promptly and in any event within 30
          days after the filing thereof with the Internal Revenue Service,
          copies of each Schedule B (Actuarial Information) to the annual report
          (Form 5500 Series) with respect to each Plan.

               (iv) Multiemployer Plan Notices. Promptly and in any event within
          five Business Days after receipt thereof by any Loan Party or any
          ERISA Affiliate from the sponsor of a Multiemployer Plan, copies of
          each notice concerning (A) the imposition of Withdrawal Liability by
          any such Multiemployer Plan, (B) the reorganization or termination,
          within the meaning of Title IV of ERISA, of any such Multiemployer
          Plan or (C) the amount of liability incurred, or that may be incurred,
          by such Loan Party or any ERISA Affiliate in connection with any event
          described in clause (A) or (B).

          (h) Environmental Conditions. Promptly after the assertion or
     occurrence thereof, notice of any Environmental Action against or of any
     noncompliance by any Loan Party or any of its Subsidiaries with any
     Environmental Law or Environmental Permit that could reasonably be expected
     to have a Material Adverse Effect.

          (i) Other Information. Such other information respecting the business,
     condition (financial or otherwise), operations, performance, properties or
     prospects of any Loan Party or any of its Subsidiaries as any Agent or any
     Lender Party, through the Administrative Agent, may from time to time
     reasonably request.

     SECTION 5.04. Financial Covenants. So long as any Advance or any other
                   -------------------
Obligation of any Loan Party under any Loan Document shall remain unpaid, any
Letter of Credit shall be outstanding or any Lender Party shall have any
Commitment hereunder, the Borrower will:

          (a) Leverage Ratio. Maintain a Leverage Ratio at all times during each
     Measurement Period set forth below of not more than the amount set forth
     below opposite such Measurement Period:

          ====================================================================
                  Measurement Period Ending In                  Ratio
          ====================================================================
          June 30, 2002                                       4.50:1.00
          ====================================================================
          September 30, 2002                                  4.50:1.00
          ====================================================================
          December 31, 2002                                   4.50:1.00
          ====================================================================
          March 31, 2003                                      4.50:1.00
          ====================================================================
          June 30, 2003                                       4.50:1.00
          ====================================================================
          September 30, 2003                                  4.25:1.00
          ====================================================================
          December 31, 2003                                   4.25:1.00
          ====================================================================
          March 31, 2004                                      4.00:1.00
          ====================================================================
          June 30, 2004                                       4.00:1.00
          ====================================================================
          September 30, 2004                                  3.75:1.00
          ====================================================================
          December 31, 2004                                   3.75:1.00
          ====================================================================
          March 31, 2005                                      3.50:1.00
          ====================================================================

                                       82

<PAGE>

          ====================================================================
          June 30, 2005                                       3.50:1.00
          ====================================================================
          September 30, 2005                                  3.25:1.00
          ====================================================================
          December 31, 2005                                   3.25:1.00
          ====================================================================
          March 31, 2006 and thereafter                       3.00:1.00
          ====================================================================

     provided, however, that upon receipt by the Administrative Agent of a
     Notice of Covenant Reduction, the Leverage Ratio thereafter for purposes of
     this covenant shall at all times be 3.00:1.00.

          (b) Fixed Charge Coverage Ratio. Maintain a Fixed Charge Coverage
     Ratio as of the last day of each Measurement Period set forth below of not
     less than the amount set forth below opposite such Measurement Period:

          ====================================================================
                  Measurement Period Ending In                  Ratio
          ====================================================================
          June 30, 2002                                       1.20:1.00
          ====================================================================
          September 30, 2002                                  1.20:1.00
          ====================================================================
          December 31, 2002                                   1.20:1.00
          ====================================================================
          March 31, 2003                                      1.20:1.00
          ====================================================================
          June 30, 2003                                       1.20:1.00
          ====================================================================
          September 30, 2003                                  1.20:1.00
          ====================================================================
          December 31, 2003                                   1.20:1.00
          ====================================================================
          March 31, 2004                                      1.20:1.00
          ====================================================================
          June 30, 2004                                       1.20:1.00
          ====================================================================
          September 30, 2004                                  1.20:1.00
          ====================================================================
          December 31, 2004                                   1.20:1.00
          ====================================================================
          March 31, 2005                                      1.25:1.00
          ====================================================================
          June 30, 2005                                       1.25:1.00
          ====================================================================
          September 30, 2005                                  1.25:1.00
          ====================================================================
          December 31, 2005                                   1.25:1.00
          ====================================================================
          March 31, 2006                                      1.30:1.00
          ====================================================================
          June 30, 2006                                       0.90:1.00
          ====================================================================
          September 30, 2006                                  0.90:1.00
          ====================================================================
          December 31, 2006                                   0.90:1.00
          ====================================================================
          March 31, 2007                                      0.90:1.00
          ====================================================================
          June 30, 2007 and thereafter                        0.70:1.00
          ====================================================================

                                       83

<PAGE>

          (c) Minimum Net Worth. Maintain at all times a Consolidated net worth
     of the Borrower and its Subsidiaries of not less than (negative
     $250,000,000), plus the sum of 75% of Consolidated Net Income of the
     Borrower and its Subsidiaries (determined as of the end of each Fiscal
     Quarter, but excluding net losses in any Fiscal Quarter) and 100% of the
     Net Cash Proceeds received by the Borrower from its issuance of Equity
     Interests, in each case determined on a cumulative basis for the period
     commencing April 1, 2002, minus non-recurring charges incurred not
     exceeding in the aggregate $45,000,000 resulting from the write-off of
     accounts receivable and other related charges as a result of the pending
     third party carrier review of claims for Medicare reimbursement submitted
     by the Subsidiary of the Borrower operating the Borrower's Florida
     laboratory or other Governmental Reimbursement Program Costs.

          (d) Minimum Consolidated EBITDA Ratio. Maintain at all times a ratio
     of Consolidated EBITDA to Consolidated Pre-Minority EBITDA of not less than
     0.8:1.0.

          (e) Senior Leverage Ratio. Maintain a Senior Leverage Ratio at all
     times during each Measurement Period set forth below of not more than the
     amount set forth below opposite such period.

          ====================================================================
                  Measurement Period Ending In                  Ratio
          ====================================================================
          June 30, 2002                                       3.00:1.00
          ====================================================================
          September 30, 2002                                  3.00:1.00
          ====================================================================
          December 31, 2002                                   3.00:1.00
          ====================================================================
          March 31, 2003                                      3.00:1.00
          ====================================================================
          June 30, 2003                                       3.00:1.00
          ====================================================================
          September 30, 2003                                  2.80:1.00
          ====================================================================
          December 31, 2003                                   2.80:1.00
          ====================================================================
          March 31, 2004                                      2.60:1.00
          ====================================================================
          June 30, 2004                                       2.60:1.00
          ====================================================================
          September 30, 2004                                  2.35:1.00
          ====================================================================
          December 31, 2004                                   2.35:1.00
          ====================================================================
          March 31, 2005                                      2.15:1.00
          ====================================================================
          June 30, 2005                                       2.15:1.00
          ====================================================================
          September 30, 2005                                  1.90:1.00
          ====================================================================
          December 31, 2005                                   1.90:1.00
          ====================================================================
          March 31, 2006 and thereafter                       1.75:1.00
          ====================================================================

     provided, however, that upon receipt by the Administrative Agent of a
     Notice of Covenant Reduction, the Leverage Ratio thereafter for purposes of
     this covenant shall at all times be 1.75:1.00.

                                       84

<PAGE>

                                   ARTICLE VI

                                EVENTS OF DEFAULT

     SECTION 6.01. Events of Default. If any of the following events ("Events of
                   -----------------
Default") shall occur and be continuing:

          (a) the Borrower shall fail to pay (i) any principal of any Advance
     when the same shall become due and payable, or (ii) within three Business
     Days after the date due and payable, any interest on any Advance; or any of
     the Loan Parties shall fail to make any other payment under or in respect
     of any of the Loan Documents required to have been made by it, within three
     Business Days after the same shall become due and payable, in each case
     whether by scheduled maturity or at a date fixed for prepayment or by
     acceleration, demand or otherwise; or

          (b) any representation or warranty made by any of the Loan Parties (or
     any of their respective officers) under or in connection with any of the
     Loan Documents (including, without limitation, in any certificate, report,
     statement or other writing at any time furnished (or deemed to have been
     furnished) to the Administrative Agent or any of the Lender Parties by or
     on behalf of any of the Loan Parties) shall prove to have been incorrect in
     any material respect on the date as of which it was made or deemed made; or

          (c) (i) the Borrower shall fail to perform or observe any term,
     covenant or agreement contained in Section 5.01(e) or Section 5.02, 5.03 or
     5.04 or (ii) any of the other Loan Parties shall fail to perform or observe
     any term, covenant or agreement contained in Section 4 or 7 of the
     Subsidiary Guarantee on its part to be performed or observed; or

          (d) any of the Loan Parties shall fail to perform or observe any term,
     covenant or agreement contained in any of the Loan Documents on its part to
     be performed or observed that is not otherwise referred to in Section
     6.01(c) if such failure shall remain unremedied for at least 30 consecutive
     days after the earlier of the date on which (i) a Responsible Officer of
     the Borrower or any of its Subsidiaries first becomes aware of such failure
     and (ii) written notice thereof shall have been given to the Borrower by
     the Administrative Agent or any of the Lender Parties; or

          (e) (i) the Borrower or any of its Subsidiaries shall fail to pay any
     principal of, premium or interest on, or any other amount payable in
     respect of, one or more items of Debt of the Borrower and its Subsidiaries
     (excluding Debt outstanding hereunder) that is outstanding (or under which
     one or more Persons have a commitment to extend credit) in an aggregate
     principal amount (or, in the case of any Hedge Agreement, having an
     Agreement Value) of at least $10,000,000 at the time of such failure, when
     the same becomes due and payable (whether by scheduled maturity, required
     prepayment, acceleration, demand or otherwise), and such failure shall
     continue after the applicable grace period, if any, specified in the
     agreements or instruments relating to all such Debt; or (ii) any other
     event shall occur or condition shall exist under the agreements or
     instruments relating to one or more items of Debt of the Borrower and its
     Subsidiaries (excluding Debt outstanding hereunder) that is outstanding (or
     under which one or more Persons have a commitment to extend credit) in an
     aggregate principal amount (or, in the case of any Hedge Agreement, having
     an Agreement Value) of at least $10,000,000 at the time of such other event
     or condition, and shall continue after the applicable grace period, if any,
     specified in all such agreements or instruments, if the effect of such
     event or condition is to accelerate, or to permit the acceleration of, the
     maturity of such Debt or otherwise to cause, or to permit the holder
     thereof to cause, such Debt to mature; or (iii) one or more items of Debt
     of the Borrower and its Subsidiaries (excluding Debt outstanding hereunder)
     that is outstanding (or

                                       85

<PAGE>

     under which one or more Persons have a commitment to extend credit) in an
     aggregate principal amount (or, in the case of any Hedge Agreement, having
     an Agreement Value) of at least $10,000,000 shall be declared to be due and
     payable or required to be prepaid or redeemed (other than by a regularly
     scheduled or required prepayment or redemption), purchased or defeased, or
     an offer to prepay, redeem, purchase or defease such Debt shall be required
     to be made, in each case prior to the stated maturity thereof; or

          (f) the Borrower or any Material Subsidiary or Subsidiaries shall
     generally not pay its debts as such debts become due, or shall admit in
     writing its inability to pay its debts generally, or shall make a general
     assignment for the benefit of creditors; or any proceeding shall be
     instituted by or against the Borrower or any Material Subsidiary or
     Subsidiaries seeking to adjudicate it a bankrupt or insolvent, or seeking
     liquidation, winding up, reorganization, arrangement, adjustment,
     protection, relief, or composition of it or its debts under any law
     relating to bankruptcy, insolvency or reorganization or relief of debtors,
     or seeking the entry of an order for relief or the appointment of a
     receiver, trustee, administrator or other similar official for it or for
     any substantial part of its property and assets and, in the case of any
     such proceeding instituted against it (but not instituted by it) that is
     being diligently contested by it in good faith, either such proceeding
     shall remain undismissed or unstayed for a period of at least 60
     consecutive days or any of the actions sought in such proceeding
     (including, without limitation, the entry of an order for relief against,
     or the appointment of a receiver, trustee, custodian or other similar
     official for, it or any substantial part of its property and assets) shall
     occur; or any event or action analogous to or having a substantially
     similar effect to any of the events or actions set forth above in this
     Section 6.01(f) (other than a solvent reorganization) shall occur under the
     Requirements of Law of any jurisdiction applicable to the Borrower or any
     Material Subsidiary or Subsidiaries; or the Borrower or any Material
     Subsidiary or Subsidiaries shall take any corporate, partnership, limited
     liability company or other similar action to authorize any of the actions
     set forth above in this Section 6.01(f); or

          (g) one or more judgments or orders for the payment of money in excess
     of $10,000,000 in the aggregate shall be rendered against one or more of
     the Borrower and its Subsidiaries and shall remain unsatisfied and there
     shall be any period of at least 30 consecutive Business Days during which a
     stay of enforcement of any such judgment or order, by reason of a pending
     appeal or otherwise, shall not be in effect; provided, however, that any
     such judgment or order shall not give rise to an Event of Default under
     this Section 6.01(g) if and for so long as (A) the amount of such judgment
     or order which remains unsatisfied is covered by a valid and binding policy
     of insurance between the defendant and the insurer covering full payment
     thereof and (B) such insurer has been notified, and has not disputed the
     claim made for payment, of the amount of such judgment or order; or

          (h) one or more nonmonetary judgments or orders (including, without
     limitation, writs or warrants of attachment, garnishment, execution,
     distraint or similar process) shall be rendered against the Borrower or any
     of its Subsidiaries that, either individually or in the aggregate, is
     reasonably expected to have a Material Adverse Effect and there shall be
     any period of at least 30 consecutive Business Days during which a stay of
     enforcement of any such judgment or order, by reason of a pending appeal or
     otherwise, shall not be in effect; or

          (i) any provision of any of the Loan Documents after delivery thereof
     pursuant to Sections 3.01, 5.01(j) or 5.01(k) shall for any reason (other
     than pursuant to the terms thereof) cease to be valid and binding on or
     enforceable against any of the Loan Parties intended to be a party to it,
     or any such Loan Party shall so state in writing;

                                       86

<PAGE>

          (j) any Collateral Document or financing statement after delivery
     thereof pursuant to Sections 3.01, 5.01(j) or 5.01(k) shall for any reason
     (other than pursuant to the terms thereof) cease to create a valid and
     perfected Lien on any material portion of the Collateral purported to be
     covered thereby subject only to Liens permitted thereby; or

          (k) any of the following events or conditions shall have occurred and
     such event or condition, when aggregated with any and all other such events
     or conditions set forth in this subsection (k), has resulted or is
     reasonably expected to result in liabilities of the Loan Parties and/or the
     ERISA Affiliates in an aggregate amount exceeding $10,000,000 at any time:

               (i) any ERISA Event shall have occurred with respect to a Plan;
          or

               (ii) any of the Loan Parties or any of the ERISA Affiliates shall
          have been notified by the sponsor of a Multiemployer Plan that it has
          incurred Withdrawal Liability to such Multiemployer Plan; or

               (iii) any of the Loan Parties or any of the ERISA Affiliates
          shall have been notified by the sponsor of a Multiemployer Plan that
          such Multiemployer Plan is in reorganization, is insolvent or is being
          terminated, within the meaning of Title IV of ERISA, and, as a result
          of such reorganization, insolvency or termination, the aggregate
          annual contributions of the Loan Parties and the ERISA Affiliates to
          all of the Multiemployer Plans that are in reorganization, are
          insolvent or being terminated at such time have been or will be
          increased over the amounts contributed to such Multiemployer Plans for
          the plan years of such Multiemployer Plans immediately preceding the
          plan year in which such reorganization, insolvency or termination
          occurs; or

               (iv) any "accumulated funding deficiency" (as defined in Section
          302 of ERISA and Section 412 of the Internal Revenue Code), whether or
          not waived, shall exist with respect to one or more of the Plans, or
          any Lien shall exist on the property and assets of any of the Loan
          Parties or any of the ERISA Affiliates in favor of the PBGC or any
          Plan; or

          (l) the Borrower or any of its Subsidiaries shall suspend or
     discontinue all or any part of its businesses and operations other than in
     the ordinary course of business and such suspension or discontinuance, in
     the aggregate, is reasonably expected to have a Material Adverse Effect; or

          (m) a Change of Control shall occur;

          (n) an "Event of Default" (as defined in any of the Subordinated Notes
     Documents) shall have occurred and be continuing under the respective
     Subordinated Notes Documents; or

          (o) The Borrower or any Subsidiary, in each case to the extent it is
     engaged in the business of providing services for which Medicare or
     Medicaid reimbursement is sought, shall for any reason, including, without
     limitation, as the result of any finding, designation or decertification,
     lose its right or authorization, or otherwise fail to be eligible, to
     participate in Medicaid or Medicare programs or to accept assignments or
     rights to reimbursements under Medicaid regulations or Medicare
     regulations, or the Borrower or any Subsidiary has, for any reason, had its
     right to receive reimbursements under Medicaid or Medicare regulations
     suspended, and such loss, failure or suspension (together with all such
     other losses, failures and suspensions continuing at such time) shall have
     resulted in (x) a Material Adverse Effect or (y)

                                       87

<PAGE>

     Consolidated net operating revenues for the immediately preceding four
     fiscal quarter period of the Borrower constituting less than 95% of
     Consolidated net operating revenues for any preceding four fiscal quarter
     period of the Borrower;

then, and in any such event, the Administrative Agent (i) shall at the request,
or may with the consent, of the Required Lenders, by notice to the Borrower,
declare the Commitments of each of the Lender Parties and the obligation of each
of the Lender Parties to make Advances (other than Letter of Credit Advances by
the Issuing Bank or any of the Revolving Credit Lenders pursuant to Section
2.03(c)(i) and Swing Line Advances by any of the Revolving Credit Lenders
pursuant to Section 2.02(b)(ii)) and of the Issuing Bank to issue Letters of
Credit to be terminated, whereupon the same shall forthwith terminate, and (ii)
shall at the request, or may with the consent, of the Required Lenders, (A) by
notice to the Borrower, declare the Notes, all interest thereon and all other
amounts payable under or in respect of this Agreement and the other Loan
Documents to be forthwith due and payable, whereupon the Notes, all such
interest and all such other amounts shall become and be forthwith due and
payable, without presentment, demand, protest or further notice of any kind, all
of which are hereby expressly waived by the Borrower and (B) by notice to each
party required under the terms of any agreement in support of which a Letter of
Credit is issued, request that all of the Obligations under such agreement be
declared to be due and payable; provided, however, that in the event of an
actual or deemed entry of an order for relief with respect to any Loan Party
under the United States Federal Bankruptcy Code or a similar order or action
under any other Requirements of Law covering the protection of creditors' rights
or the relief of debtors applicable to any Loan Party, (1) the Commitments of
each of the Lender Parties and the obligation of each of the Lender Parties to
make Advances (other than Letter of Credit Advances by the Issuing Bank or any
of the Revolving Credit Lenders pursuant to Section 2.03(c)(i) and Swing Line
Advances by any of the Revolving Credit Lenders pursuant to Section 2.02(b)(ii))
and of the Issuing Bank to issue Letters of Credit shall automatically be
terminated and (2) the Notes, all such interest and all such amounts shall
automatically become and be due and payable, without presentment, demand,
protest or any notice of any kind, all of which are hereby expressly waived by
the Borrower.

     SECTION 6.02. Actions in Respect of the Letters of Credit upon Default. If
                   --------------------------------------------------------
any Event of Default shall have occurred and be continuing, the Administrative
Agent may, or shall at the request of the Required Lenders, irrespective of
whether it is taking any of the actions described in Section 6.01 or otherwise,
make demand upon the Borrower to, and forthwith upon such demand the Borrower
will, pay to the Administrative Agent in same day funds at the Administrative
Agent's office designated in such demand, for deposit in the L/C Cash Collateral
Account, an amount equal to the aggregate Available Amount of all Letters of
Credit then outstanding; provided, however, that in the event of an actual or
deemed entry of an order for relief with respect to any Loan Party under the
United States Federal Bankruptcy Code or a similar order or action under any
other Requirements of Law covering the protection of creditors' rights or the
relief of debtors applicable to any Loan Party, the Borrower, without
requirement of demand by the Administrative Agent or any other Person, will
forthwith pay to the Administrative Agent in same day funds at the
Administrative Agent's office for deposit in the L/C Cash Collateral Account an
amount equal to such aggregate Available Amount. If at any time the
Administrative Agent determines that any funds held in the L/C Cash Collateral
Account are subject to any right or claim of any Person other than the Secured
Parties or that the total amount of such funds is less than the aggregate
Available Amount of all Letters of Credit, the Borrower will, forthwith upon
demand by the Administrative Agent, pay to the Administrative Agent, as
additional funds to be deposited and held in the L/C Cash Collateral Account, an
amount equal to the excess of (a) such aggregate Available Amount over (b) the
total amount of funds, if any, then held in the L/C Cash Collateral Account 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
in the L/C Cash Collateral Account, such funds shall be applied to reimburse the
Issuing Bank or Revolving Credit Lenders, as applicable, in the manner provided
for in the Security Agreement and to the extent permitted by applicable law.

                                       88

<PAGE>

                                  ARTICLE VII

                                   THE AGENTS

     SECTION 7.01. Appointment, Powers and Immunity.
                   --------------------------------

          (a) Each Lender Party (in its capacities as a Lender, the Swing Line
     Bank (if applicable), the Issuing Bank (if applicable) and on behalf of
     itself and its Affiliates as potential Hedge Banks) hereby appoints and
     authorizes the Administrative Agent to act as its agent under this
     Agreement and the other Loan Documents with such powers and discretion as
     are specifically delegated to the Administrative Agent by the terms of this
     Agreement and the other Loan Documents, together with such other powers as
     are reasonably incidental thereto. The Administrative Agent (which term as
     used in this sentence and in Section 7.05(a) and the first sentence of
     Section 7.06 shall include its affiliates and its own and its affiliates'
     officers, directors, employees, and agents): (i) shall not have any duties
     or responsibilities except those expressly set forth in this Agreement and
     shall not be a trustee or fiduciary for any Lender Party; (ii) shall not be
     responsible to the Lender Parties for any recital, statement,
     representation, or warranty (whether written or oral) made in or in
     connection with any Loan Document or any certificate or other document
     referred to or provided for in, or received by any of them under, any Loan
     Document, or for the value, validity, effectiveness, genuineness,
     enforceability, or sufficiency of, or the perfection or priority of any
     lien or security interest created or purported to be created under or in
     connection with, any Loan Document, or any other document referred to or
     provided for therein or for any failure by any Loan Party or any other
     Person to perform any of its obligations thereunder; (iii) shall not be
     responsible for or have any duty to ascertain, inquire into, or verify the
     performance or observance of any covenants or agreements by any Loan Party
     or the satisfaction of any condition or to inspect the property (including
     the books and records) of any Loan Party or any of its Subsidiaries or
     Affiliates; (iv) shall not be required to initiate or conduct any
     litigation or collection proceedings under any Loan Document; and (v) shall
     not be responsible for any action taken or omitted to be taken by it or any
     of its directors, officers, agents or employees under or in connection with
     any Loan Document, except for its or their own gross negligence or willful
     misconduct.

          (b) The Administrative Agent shall also act as the "collateral agent"
     under the Loan Documents, and each of the Lender Parties (in its capacities
     as a Lender, the Swing Line Bank (if applicable), Issuing Bank (if
     applicable) hereby appoints and authorizes the Administrative Agent to act
     as the agent of such Lender Party 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 Secured Obligations, together with such powers
     and discretion as are reasonably incidental thereto. The Administrative
     Agent may from time to time in its discretion appoint any of the other
     Lender Parties or any of the affiliates of a Lender Party to act as its
     co-agent or sub-agent or its attorney-in-fact for any purpose, including
     for purposes of holding or enforcing any Lien on the Collateral (or any
     portion thereof) granted under the Collateral Documents or of exercising
     any rights and remedies thereunder at the direction of the Administrative
     Agent, and the Administrative Agent shall not be responsible for the
     negligence or misconduct of any such co-agents, sub-agents or
     attorneys-in-fact selected by it with reasonable care. In this connection,
     the Administrative Agent, as "collateral agent", and such co-agents,
     sub-agents and attorneys-in-fact shall be entitled to the benefits of all
     provisions of this Article VII (including, without limitation, Section
     7.05, as

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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.

          (c) The Book Managers, the Syndication Agent and the Documentation
     Agents shall not have any powers or discretion under this Agreement or any
     of the other Loan Documents other than those bestowed upon it as a co-agent
     or sub-agent from time to time by the Administrative Agent pursuant to
     subsection (b) of this Section 7.01, and each of the Lender Parties hereby
     acknowledges that the Book Managers, the Syndication Agent and the
     Documentation Agents shall not have any liability under this Agreement or
     any of the other Loan Documents.

     SECTION 7.02. Reliance by Agent. The Administrative Agent shall be entitled
                   -----------------
to rely upon any certification, notice, instrument, writing, or other
communication (including, without limitation, any thereof by telephone or
telecopy) believed by it to be genuine and correct and to have been signed, sent
or made by or on behalf of the proper Person or Persons, and upon advice and
statements of legal counsel (including counsel for any Loan Party), independent
accountants, and other experts selected by the Administrative Agent. The
Administrative Agent may deem and treat the payee of any Note as the holder
thereof for all purposes hereof unless and until the Administrative Agent
receives and accepts an Assignment and Assumption executed in accordance with
Section 8.07. As to any matters not expressly provided for by this Agreement,
the Administrative Agent shall not be required to exercise any discretion or
take any action, but shall be required to act or to refrain from acting (and
shall be fully protected in so acting or refraining from acting) upon the
instructions of the Required Lenders or, to the extent any action requires the
consent of all Lenders as specifically provided in Section 8.01, upon the
instructions of all Lenders, and such instructions shall be binding on all of
the Lender Parties; provided, however, that the Administrative Agent shall not
be required to take any action that exposes the Administrative Agent to personal
liability or that is contrary to any Loan Document or applicable Requirements of
Law or unless it shall first be indemnified to its satisfaction by the Lender
Parties against any and all liability and expense which may be incurred by it by
reason of taking any such action.

     SECTION 7.03. Defaults. The Administrative Agent shall not be deemed to
                   --------
have knowledge or notice of the occurrence of a Default or Event of Default
unless the Administrative Agent has received written notice from a Lender Party
or the Borrower specifying such Default or Event of Default and stating that
such notice is a "Notice of Default". In the event that the Administrative Agent
receives such a notice of the occurrence of a Default or Event of Default, the
Administrative Agent shall give prompt notice thereof to the Lender Parties. The
Administrative Agent shall (subject to Section 7.02) take such action with
respect to such Default or Event of Default as shall reasonably be directed by
the Required Lenders or, to the extent any action requires the consent of all
Lenders as specifically provided in Section 8.01, then as directed by all
Lenders; provided that, unless and until the Administrative Agent shall have
received such directions, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem advisable in the best
interest of the Lender Parties.

     SECTION 7.04. CSFB and Affiliates. With respect to its Commitments, the
                   -------------------
Advances made by it and the Note or Notes issued to it, CSFB (and any successor
acting as the Administrative Agent) in its capacity as a Lender Party hereunder
shall have the same rights and powers under the Loan Documents as any other
Lender Party and may exercise the same as though it were not acting as the
Administrative Agent; and the term "Lender Party" or "Lender Parties" shall,
unless otherwise expressly indicated, include CSFB in its individual capacity.
CSFB (and any successor acting as the Administrative Agent), and its affiliates
may (without having to account therefor to any Lender Party) accept deposits
from, lend money to, make investments in, provide services to, and generally
engage in any kind of lending, trust, or other business with any Loan Party or
any of its Subsidiaries or Affiliates as if it were not acting as an

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Agent, and CSFB (and any successor acting as the Administrative Agent), and its
affiliates may accept fees and other consideration from any Loan Party or any of
its Subsidiaries or Affiliates, or any Person that may do business with or own
securities of any Loan Party or any such Subsidiary or Affiliate, for services
in connection with this Agreement or otherwise without having to account for the
same to the Lender Parties.

     SECTION 7.05. Indemnification.
                   ---------------

          (a) The Lenders severally agree to indemnify the Administrative Agent
     (to the extent not promptly reimbursed under Section 8.04, but without
     limiting the obligations of the Borrower under such Section) ratably in
     accordance with their respective Commitments, for any and all liabilities,
     obligations, losses, damages, penalties, actions, judgments, suits, costs,
     expenses (including attorneys' fees), or disbursements of any kind and
     nature whatsoever that may be imposed on, incurred by or asserted against
     the Administrative Agent in any way relating to or arising out of any Loan
     Document or the transactions contemplated thereby or any action taken or
     omitted by the Administrative Agent under any Loan Document (collectively,
     the "Indemnified Costs"); provided that no Lender shall be liable for any
     of the foregoing to the extent they arise from the gross negligence or
     willful misconduct of the Person to be indemnified. In the case of any
     claim, investigation, litigation or proceeding for which indemnity under
     this Section 7.05(a) applies, such indemnity shall apply whether or not
     such claim, investigation, litigation or proceeding is brought by the
     Administrative Agent, any of the other Agents, any of the Lender Parties or
     a third party. Without limitation of the foregoing, each Lender severally
     agrees to reimburse the Administrative Agent promptly upon demand for its
     ratable share of any costs or expenses payable by the Borrower under
     Section 8.04, to the extent that the Administrative Agent is not promptly
     reimbursed for such costs and expenses (including, without limitation, fees
     and expenses of counsel) by the Borrower. In the case of any investigation,
     litigation or proceeding giving rise to any Indemnified Costs, this Section
     7.05 applies whether any such investigation, litigation or proceeding is
     brought by any Lender Party or any other Person. The failure of any Lender
     Party to reimburse the Administrative Agent promptly upon demand for its
     ratable share of any amount required to be paid by the Lender Party to the
     Administrative Agent as provided herein shall not relieve any other Lender
     Party of its obligation hereunder to reimburse the Administrative Agent for
     its ratable share of such amount, but no Lender Party shall be responsible
     for the failure of any other Lender Party to reimburse the Administrative
     Agent for such other Lender Party's ratable share of such amount. Without
     prejudice to the survival of any other agreement of any Lender Party
     hereunder, the agreement and obligations of each Lender contained in this
     Section 7.05(a) shall survive the payment in full of principal, interest
     and all other amounts payable hereunder and under the other Loan Documents.

          (b) The Revolving Credit Lenders severally agree to indemnify the
     Issuing Bank (to the extent not promptly reimbursed under Section 8.04, but
     without limiting the obligations of the Borrower under such Section) for
     such Revolving Credit Lender's Pro Rata Share of any and all liabilities,
     obligations, losses, damages, penalties, actions, judgments, suits, costs,
     expenses or disbursements of any kind or nature whatsoever that may be
     imposed on, incurred by, or asserted against the Issuing Bank in any way
     relating to or arising out of the Loan Documents or the transactions
     contemplated thereby or any action taken or omitted by the Issuing Bank
     under the Loan Documents; provided, however, that no Revolving Credit
     Lender shall be liable for any portion of such liabilities, obligations,
     losses, damages, penalties, actions, judgments, suits, costs, expenses or
     disbursements resulting from the Issuing Bank's gross negligence or willful
     misconduct. In the case of any claim, investigation, litigation or
     proceeding for which indemnity under this Section 7.05(b) applies, such
     indemnity shall apply whether or not such claim, investigation, litigation
     or proceeding is brought by the Issuing Bank, any of the other Lender

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     Parties or a third party. Without limitation of the foregoing, each
     Revolving Credit Lender severally agrees to reimburse the Issuing Bank
     promptly upon demand for its Pro Rata Share of any costs and expenses
     (including, without limitation, fees and expenses of counsel) payable by
     the Borrower under Section 8.04, to the extent that the Issuing Bank is not
     promptly reimbursed for such costs and expenses by the Borrower. The
     failure of any Revolving Credit Lender to reimburse the Issuing Bank
     promptly upon demand for its Pro Rata Share of any amount required to be
     paid by the Revolving Credit Lenders to the Issuing Bank as provided herein
     shall not relieve any other Revolving Credit Lender of its obligation
     hereunder to reimburse the Issuing Bank for its Pro Rata Share of such
     amount, but no Revolving Credit Lender shall be responsible for the failure
     of any other Revolving Credit Lender to reimburse the Issuing Bank for such
     other Revolving Credit Lender's Pro Rata Share of such amount. Without
     prejudice to the survival of any other agreement of any Revolving Credit
     Lender hereunder, the agreement and obligations of each Revolving Credit
     Lender contained in this Section 7.05(b) shall survive the payment in full
     of principal, interest and all other amounts payable hereunder and under
     the other Loan Documents.

     SECTION 7.06. Non-Reliance on Agent and Other Lender Parties. Each Lender
                   ----------------------------------------------
Party agrees that it has, independently and without reliance on any Agent or any
other Lender Party, and based on such documents and information as it has deemed
appropriate, made its own credit analysis of the Loan Parties and their
Subsidiaries and decision to enter into this Agreement and that it will,
independently and without reliance upon any Agent or any other Lender Party, and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own analysis and decisions in taking or not taking
action under the Loan Documents. Except for notices, reports, and other
documents and information expressly required to be furnished to the Lender
Parties by the Administrative Agent hereunder, the Administrative Agent shall
not have any duty or responsibility to provide any Lender Party with any credit
or other information concerning the affairs, financial condition, or business of
any Loan Party or any of its Subsidiaries or Affiliates that may come into the
possession of the Administrative Agent or any of its affiliates.

     SECTION 7.07. Resignation of Administrative Agent. The Administrative Agent
                   -----------------------------------
may resign at any time by giving notice thereof to the Lender Parties and the
Borrower. Upon any such resignation, the Required Lenders shall have the right
to appoint a successor Administrative Agent. If no successor Agent shall have
been so appointed by the Required Lenders and shall have accepted such
appointment within 30 days after the retiring Administrative Agent's giving of
notice of resignation, then the retiring Administrative Agent may, on behalf of
the Lender Parties, appoint a successor Administrative Agent which shall be a
commercial bank organized under the laws of the United States of America or of
any state thereof and having combined capital and surplus of at least
$100,000,000. If within 30 days after written notice is given of the retiring
Administrative Agent's resignation under this Section 7.07 no successor
Administrative Agent shall have been appointed and shall have accepted such
appointment, then on such 30th day (a) the retiring Administrative Agent's
resignation shall become effective, (b) the retiring Administrative Agent shall
thereupon be discharged from its duties and obligations under the Loan Documents
and (c) the Required Lenders shall thereafter perform all duties and obligations
of the retiring Administrative Agent under the Loan Documents until such time,
if any, as the Required Lenders appoint a successor Administrative Agent as
provided above in this Section 7.07. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor and upon the execution and filing
or recording of such financing statements, or amendments thereto, and such other
instruments or notices, as may be necessary or desirable, or as the Required
Lenders may request, in order to continue the perfection of the Liens granted or
purported to be granted by the Collateral Documents, such successor
Administrative Agent shall thereupon succeed to and become vested with all the
rights, powers, discretion, privileges, and duties of the retiring Agent, and
the retiring Administrative Agent shall be discharged from its duties and
obligations under the Loan Documents. After any retiring Agent's

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resignation hereunder as Administrative Agent, the provisions of this Article
VII shall continue in effect for its benefit in respect of any actions taken or
omitted to be taken by it while it was acting as Administrative Agent.

     SECTION 7.08. Release of Collateral. Upon the payment of all Notes and all
                   ---------------------
other amounts payable under the Loan Documents, the termination of all Letters
of Credit and the termination of all commitments of the Lender Parties
hereunder, the Lender Parties hereby agree that all Collateral is released from
the security interest granted under the respective Collateral Documents, and
upon (i) the sale, lease, transfer or other disposition of any item of
Collateral of any Loan Party, (ii) the issuance or sale pursuant to Section
5.02(m)(iii) of any Equity Interests causing a Subsidiary of the Borrower to
cease to be wholly-owned by the Borrower or any of its Subsidiaries, in each
case in accordance with the terms of the Loan Documents, the Lender Parties
hereby agree that such item of Collateral in the case of clause (i), or all
Collateral owned by such Subsidiary in the case of clause (ii), shall be
released from the security interest granted under the respective Collateral
Documents. In connection therewith, the Lender Parties hereby irrevocably
authorize the Administrative Agent to release any such Collateral. The
Administrative Agent will, at the Borrower's expense, execute and deliver to the
respective Loan Party such documents as such Loan Party may reasonably request
to evidence the release of such item of Collateral from the security interest
granted under the Collateral Documents.

     SECTION 7.09. Release of Guarantor. Upon the sale of outstanding shares of
                   --------------------
capital stock and other equity, ownership and profit interests in any Guarantor
in a transaction which is permitted under Section 5.02(e) and, if applicable,
5.02(m)(iii), then upon request by the Borrower, the Administrative Agent, on
behalf of each Lender Party, shall confirm in writing that the liability of such
Guarantor under the Subsidiary Guarantee is released and discharged effective
when such transaction is consummated and all requirements hereunder in
connection therewith are satisfied, including with respect to the application of
the proceeds of such sale. Such confirmation from the Administrative Agent (a)
shall establish conclusively that the liability of such Guarantor under the
Subsidiary Guarantee is released and discharged and (b) may be relied on,
without further inquiry, by the purchaser in such transaction and each of its
transferees. Each Lender Party hereby irrevocably authorizes the Administrative
Agent to release any Guarantor from time to time to the extent provided for
herein and to execute any document reasonably required in connection therewith.

     SECTION 7.10. Actions in Respect of Intercreditor Agreement. The Lenders
                   ---------------------------------------------
and the Issuing Banks hereby authorize the Administrative Agent, in its capacity
as Administrative Agent on behalf of the Lenders and the Issuing Banks, to enter
into the Intercreditor Agreement and hereby consent to the Administrative Agent
acting as Collateral Agent under the Intercreditor Agreement.

                                  ARTICLE VIII

                                  MISCELLANEOUS

     SECTION 8.01. Amendments, Etc. No amendment or waiver of any provision of
                   ---------------
this Agreement, the Notes, or any of the other Loan Documents (except to the
extent otherwise expressly provided for therein), nor consent to any departure
by any of the Loan Parties therefrom, shall in any event be effective unless the
same shall be in writing and signed by the Required Lenders, and then such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given; provided, however, that:

          (a) no amendment, waiver or consent shall, unless in writing and
     signed by all of the Lenders (other than any of the Lenders that is, at
     such time, a Defaulting Lender), do any of the following at any time:

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               (i) waive any of the conditions specified in Section 3.01 or, in
          the case of the Initial Extensions of Credit, Section 3.02;

               (ii) change the number of Lenders or the percentage of the
          Commitments or the aggregate outstanding principal amount of Advances
          or the aggregate Available Amount of outstanding Letters of Credit
          that, in each case, shall be required for the Lender Parties or any of
          them to take any action hereunder;

               (iii) except to the extent contemplated herein, release all or
          substantially all of the Guarantors that are a party to the Subsidiary
          Guarantee from their Obligations thereunder in any transaction or
          series of related transactions;

               (iv) release all or substantially all of the Collateral in any
          transaction or series of related transactions;

               (v) amend Section 2.13 or this Section 8.01; or

               (vi) amend the definition of Interest Period to include
          additional monthly periods for setting the duration of an Interest
          Period.

          (b) no amendment, waiver or consent shall, unless in writing and
     signed by the Required Lenders and each of the Lenders (other than any of
     the Lenders that is, at such time, a Defaulting Lender) that has a
     Commitment under the Term Facilities or the Revolving Credit Facility or is
     owed any amounts under or in respect thereof, if such Lender is directly
     affected by such amendment, waiver or consent:

               (i) increase the Commitments of such Lender or subject such
          Lender to any additional Obligations;

               (ii) reduce the principal or interest rate of, or interest on,
          any Advance of such Lender or any fees or other amounts payable
          hereunder to such Lender;

               (iii) postpone any date scheduled for any payment of principal
          of, or interest on, any Advance of such Lender or any fees or other
          amounts payable to such Lender; or

               (iv) change the order of application of any prepayment set forth
          in Section 2.06 in any manner that materially affects such Lender; and

     provided further that no amendment, waiver or consent shall, unless in
     writing and signed by the Swing Line Bank or the Issuing Bank, as the case
     may be, in addition to the Lenders required above to take such action,
     affect the rights or duties of the Swing Line Bank or the Issuing Bank,
     respectively, under this Agreement or any of the other Loan Documents; and
     provided further that no amendment, waiver or consent shall, unless in
     writing and signed by the Administrative Agent in addition to the Lenders
     required above to take such action, affect the rights or duties of the
     Administrative Agent under this Agreement or any of the other Loan
     Documents. Notwithstanding any of the foregoing provisions of this Section
     8.01, none of the defined terms set forth in Section 1.01 shall be amended,
     supplemented or otherwise modified hereafter in any manner that would
     change the meaning, purpose or effect of this Section 8.01 or any Section
     referred to herein unless such amendment, supplement or modification is
     agreed to in writing by the number and percentage of Lenders (and the
     Issuing Bank, the Swing Line Bank and

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     Administrative Agent, in each case if applicable) otherwise required to
     amend such Section under the terms of this Section 8.01.

     SECTION 8.02. Notices, Etc.
                   ------------

          (a) All notices and other communications provided for hereunder shall
     be in writing (including telecopy communication) and mailed, telecopied or
     delivered, if to the Borrower, at its address at 21250 Hawthorne Blvd.,
     Suite 800, Torrance, California 90503 (Telecopier (310) 792-9281),
     Attention: Chief Financial Officer with a copy to Borrower's general
     counsel at the same address (Telecopier (310) 792-0044); if to any Initial
     Lender, the Swing Line Bank or the Initial Issuing Bank, at its Base Rate
     Lending Office specified opposite its name on Schedule I hereto; if to any
     other Lender Party, at its Base Rate Lending Office specified in the
     Assignment and Assumption pursuant to which it became a Lender Party; and
     if to the Administrative Agent, at its address at Eleven Madison Avenue,
     New York, New York 10010-3629, Attention: Agency Group Manager; or, as to
     the Borrower or the Administrative Agent, at such other address as shall be
     designated by such party in a written notice to the other parties and, as
     to each other party, at such other address as shall be designated by such
     party in a written notice to the Borrower and the Administrative Agent. All
     such notices and other communications shall, when mailed or telecopied, be
     effective when deposited in the mails, or transmitted by telecopier,
     respectively, except that notices and communications to any Agent pursuant
     to Article II, III or VII shall not be effective until received by such
     Agent. Delivery by telecopier of an executed counterpart of a signature
     page to any amendment or waiver of any provision of this Agreement or the
     Notes or of any Exhibit hereto to be executed and delivered hereunder shall
     be effective as delivery of an original executed counterpart thereof.

          (b) If any notice required under this Agreement is permitted to be
     made, and is made, by telephone, actions taken or omitted to be taken in
     reliance thereon by the Administrative Agent or any of the Lender Parties
     shall be binding upon the Borrower and the other Loan Parties
     notwithstanding any inconsistency between the notice provided by telephone
     and any subsequent writing in confirmation thereof provided to the
     Administrative Agent or such Lender Party; provided that any such action
     taken or omitted to be taken by the Administrative Agent or such Lender
     Party shall have been in good faith and in accordance with the terms of
     this Agreement.

     SECTION 8.03. No Waiver; Remedies. No failure on the part of any Lender
                   -------------------
Party or any Agent to exercise, and no delay in exercising, any right, power or
privilege hereunder or under any Note or any other Loan Document shall operate
as a waiver thereof or consent thereto; nor shall any single or partial exercise
of any such right, power or privilege preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The remedies
herein provided are cumulative and not exclusive of any remedies provided by
applicable law.

     SECTION 8.04. Costs and Expenses.
                   ------------------

          (a) The Borrower agrees to pay on demand (i) all costs and expenses of
     each Agent in connection with the syndication, preparation, execution,
     delivery, administration, modification and amendment of, or any consent or
     waiver under, the Loan Documents and the other documents to be delivered
     thereunder (including, without limitation, (A) all due diligence,
     collateral review, syndication, transportation, computer, duplication,
     appraisal, audit, insurance, consultant, search, filing and recording fees
     and expenses and (B) the reasonable fees and expenses of counsel for the
     Administrative Agent (including the cost of internal counsel) with respect
     thereto, with respect to advising such Agent as to its rights and
     responsibilities, or the perfection, protection or preservation of rights
     or interests, under the Loan Documents), and (ii) all costs and expenses of

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     each Agent and each Lender Party in connection with the enforcement of the
     Loan Documents and the other documents to be delivered thereunder, whether
     in any action, suit or litigation, or any bankruptcy, insolvency or other
     similar proceeding affecting creditors' rights generally (including,
     without limitation, the reasonable fees and expenses of counsel (including
     the cost of internal counsel) for the Administrative Agent and each Lender
     Party with respect thereto).

          (b) The Borrower agrees to indemnify, defend and save and hold
     harmless each Agent, each Lender Party and each of their affiliates and
     their respective affiliates, officers, directors, trustees, employees,
     agents and advisors (each, an "Indemnified Party") from and against, and
     shall pay on demand, any and all claims, damages, losses, liabilities and
     expenses (including, without limitation, reasonable fees and expenses of
     counsel) that may be incurred by or asserted or awarded against any
     Indemnified Party, in each case arising out of or in connection with or by
     reason of (including, without limitation, in connection with any
     investigation, litigation or proceeding or preparation of a defense in
     connection therewith) (i) the Transaction (or any aspect thereof),
     Facilities, the actual or proposed use of the proceeds of the Advances or
     the Letters of Credit, the Loan Documents, or any of the transactions
     contemplated thereby; (ii) any acquisition or proposed acquisition by the
     Borrower or any of its Subsidiaries or Affiliates of all or any portion of
     the Equity Interests in or Debt securities or substantially all of the
     property and assets of any other Person; or (iii) the actual or alleged
     presence of Hazardous Materials on any property of any Loan Party or any of
     its Subsidiaries or any Environmental Action relating in any way to any
     Loan Party or any of its Subsidiaries, except to the extent such claim,
     damage, loss, liability or expense is found in a final, non-appealable
     judgment by a court of competent jurisdiction to have resulted from such
     Indemnified Party's gross negligence or willful misconduct or have arisen
     after such Loan Party or Subsidiary is dispossessed of or relinquishes its
     interest in such property. In the case of an investigation, litigation or
     other proceeding to which the indemnity in this Section 8.04(b) applies,
     such indemnity shall be effective whether or not such investigation,
     litigation or proceeding is brought by any Loan Party, its directors,
     shareholders or creditors or an Indemnified Party or any other Person,
     whether or not any Indemnified Party is otherwise a party thereto and
     whether or not the Transaction or any of the other transactions
     contemplated hereby is consummated. If and to the extent that the indemnity
     in this subsection (b) is unenforceable for any reason other than by
     operation of the last clause of the first sentence of this subsection
     8.04(b), the Borrower hereby agrees to make to each applicable Indemnified
     Party the maximum contribution to the payment of the claims, damages,
     losses, liabilities and expenses (including, without limitation, reasonable
     fees and expenses of counsel) for which the indemnity in this subsection
     (b) has been determined to be unenforceable that is permitted under
     applicable law. The Borrower also agrees not to assert any claim against
     any Agent, any Lender Party or any of their respective affiliates,
     officers, directors, trustees, employees, agents and advisors, on any
     theory of liability, for special, indirect, consequential or punitive
     damages arising out of or otherwise relating to the Transaction (or any
     aspect thereof) Facilities, the actual or proposed use of the proceeds of
     the Advances or the Letters of Credit, the Loan Documents, or any of the
     other transactions contemplated hereby.

          (c) If any payment of principal of, or Conversion of, any Eurodollar
     Rate Advance is made by the Borrower to or for the account of a Lender
     Party other than on the last day of the Interest Period for such Advance,
     as a result of a payment or Conversion pursuant to Section 2.06, 2.09(b)(i)
     or 2.10(d), acceleration of the maturity of the Notes pursuant to Section
     6.01 or for any other reason, or by an Eligible Assignee to a Lender Party
     other than on the last day of the Interest Period for such Advance upon an
     assignment of rights and obligations under this Agreement pursuant to
     Section 8.07 as a result of a demand by the Borrower pursuant to Section
     8.07(a), or if the Borrower fails to make any payment or prepayment of an
     Advance for which a notice of prepayment has been given or that is
     otherwise required to be made, whether pursuant to

                                       97

<PAGE>

     Section 2.04, 2.06 or 6.01 or otherwise, the Borrower shall, upon demand by
     such Lender Party (with a copy of such demand to the Administrative Agent),
     pay to the Administrative Agent for the account of such Lender Party any
     amounts required to compensate such Lender Party for any additional losses,
     costs or expenses that it may reasonably incur as a result of such payment
     or Conversion or such failure to pay or prepay, as the case may be,
     including, without limitation, any loss, cost or expense incurred by reason
     of the liquidation or reemployment of deposits or other funds acquired by
     any Lender Party to fund or maintain such Advance.

          (d) If any Loan Party fails to pay when due, after the expiration of
     any grace period, if applicable, any costs, expenses or other amounts
     payable by it under any Loan Document, including, without limitation, fees
     and expenses of counsel and indemnification payments, such amount may be
     paid on behalf of such Loan Party by the Administrative Agent or any Lender
     Party, in its sole discretion.

          (e) Without prejudice to the survival of any other agreement of any
     Loan Party hereunder or under any other Loan Document, the agreements and
     obligations of the Borrower contained in Sections 2.10 and 2.13 and this
     Section 8.04 shall survive the payment in full of principal, interest and
     all other amounts payable hereunder and under any of the other Loan
     Documents.

     SECTION 8.05. Right of Set-off. Upon (a) the occurrence and during the
                   ----------------
continuance of any Event of Default and (b) the making of the request or the
granting of the consent specified by Section 6.01 to authorize the
Administrative Agent to declare the Notes due and payable pursuant to the
provisions of Section 6.01, each Agent and each Lender Party and each of their
respective Affiliates is hereby authorized at any time and from time to time, to
the fullest extent permitted by law, to set off and otherwise apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other indebtedness at any time owing by such Agent, such Lender Party
or such Affiliate to or for the credit or the account of the Borrower against
any and all of the Obligations of the Borrower now or hereafter existing under
the Loan Documents, irrespective of whether such Agent or such Lender Party
shall have made any demand under this Agreement or such Note or Notes and
although such Obligations may be unmatured. Each Agent and each Lender Party
agrees promptly to notify the Borrower after any such set-off and application;
provided, however, that the failure to give such notice shall not affect the
validity of such set-off and application. The rights of each Agent and each
Lender Party and their respective Affiliates under this Section are in addition
to other rights and remedies (including, without limitation, other rights of
set-off) that such Agent, such Lender Party and their respective Affiliates may
have.

     SECTION 8.06. Successors and Assigns. (a) The provisions of this Agreement
                   ----------------------
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby, except that the Borrower may
not assign or otherwise transfer any of its rights or obligations hereunder
without the prior written consent of each Lender Party and no Lender may assign
or otherwise transfer any of its rights or obligations hereunder except (i) to
an Eligible Assignee in accordance with Section 8.07(a), (ii) by way of
participation in accordance with Section 8.07(e), or (iii) by way of pledge or
assignment of a security interest subject to the restrictions of Section 8.07(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 Section 8.07(e) and, to the extent expressly contemplated hereby,
the Related Parties of each of the Administrative Agent and the Lender Parties)
any legal or equitable right, remedy or claim under or by reason of this
Agreement.

                                       98

<PAGE>

     SECTION 8.07. Assignments and Participations.
                   ------------------------------

          (a) (i) Any Lender may, and (ii) so long as no Default under Section
     6.01(a) or 6.01(f) or Event of Default has occurred and is continuing, if
     demanded by the Borrower (following (x) a demand by such Lender for the
     payment of additional compensation pursuant to Section 2.10(a), 2.10(b) or
     2.13 or (y) an assertion by such Lender pursuant to Section 2.10(c) or
     2.10(d) that it is impractical or unlawful for such Lender to make
     Eurodollar Rate Advances), upon at least five Business Days' notice to such
     Lender and the Administrative Agent, each of the Lenders will, at any time
     assign to one or more Eligible Assignees all or a portion of its rights and
     obligations under this Agreement (including, without limitation, all or a
     portion of its Commitment or Commitments, the Advances owing to it, the
     Note or Notes held by it and its participation in reimbursement obligations
     of the Borrower in respect of Letters of Credit); provided that:

                    (A) except in the case of an assignment of the entire
               remaining amount of the assigning Lender's Commitment or
               Commitments, the Advances owing to it, the Note or Notes held by
               it, its participation in reimbursement obligations of the
               Borrower in respect of Letters of Credit or in the case of an
               assignment to a Lender or an Affiliate of a Lender or an Approved
               Fund with respect to a Lender, the aggregate amount of the
               Commitment (which for this purpose includes Advances outstanding
               thereunder) or, if the applicable Commitment is not then in
               effect, the principal outstanding balance of the Advance 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 $2,500,000, 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
               Loan Facility, unless each of the Administrative Agent and, so
               long as no Default under Section 6.01(a) or 6.01(f) or Event of
               Default has occurred and is continuing, the Borrower otherwise
               consent (each such consent not to be unreasonably withheld or
               delayed);

                    (B) 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 Advance or
               the Commitment assigned, except that this clause (B) shall not
               prohibit any Lender from assigning all or a portion of its rights
               and obligations among separate Facilities on a non-pro rata
               basis;

                    (C) any assignment of a Revolving Credit Commitment must be
               approved by the Administrative Agent and the Issuing Bank unless
               the Person that is the proposed assignee is itself a Lender with
               a Revolving Credit Commitment (whether or not the proposed
               assignee would otherwise qualify as an Eligible Assignee);

                    (D) the parties to each assignment shall execute and deliver
               to the Administrative Agent an Assignment and Assumption,
               together with any Note or Notes subject to such assignment and,
               except in the case of an assignment by any of the Lenders to an
               Affiliate or an Approved Fund of such Lender, a processing and
               recordation fee of $3,500 (and in the case of assignments on the
               same day by a Lender to more than one fund managed or advised by
               the same investment

                                       99

<PAGE>

               advisor (which funds are not then Lenders hereunder), only a
               single $3,500 processing and recordation fee shall be payable for
               all such assignments by such Lender to such funds), at the
               discretion of the Administrative Agent, and the Eligible
               Assignee, if it shall not be a Lender, shall deliver to the
               Administrative Agent an Administrative Questionnaire;

                    (E) the Swing Line Bank may not assign or otherwise transfer
               to any other Person any of its rights or obligations under its
               Swing Line Commitment.

                    (F) each such assignment made as a result of a demand by the
               Borrower pursuant to this Section 8.07(a)(ii) shall be arranged
               by the Borrower after consultation with the Administrative Agent
               and shall be either an assignment of all of the rights and
               obligations of the assigning Lender under this Agreement or an
               assignment of a portion of such rights and obligations made
               concurrently with another such assignment or other such
               assignments that together cover all of the rights and obligations
               of the assigning Lender under this Agreement.

          (b) Subject to acceptance and recording thereof by the Administrative
     Agent pursuant to Section 8.07(c), from and after the effective date
     specified in each Assignment and Assumption, the Eligible Assignee
     thereunder shall be a party to this Agreement and, to the extent of the
     interest assigned by such Assignment and Assumption, have the rights and
     obligations of a Lender or the Issuing Bank under this Agreement, and the
     assigning Lender or Issuing Bank thereunder shall, to the extent of the
     interest assigned by such Assignment and Assumption, relinquish its rights
     and be released from its obligations under this Agreement (and, in the case
     of an Assignment and Assumption covering all of the assigning Lender's or
     Issuing Bank's rights and obligations under this Agreement, such Lender or
     Issuing Bank shall cease to be a party hereto) but shall continue to be
     entitled to the benefits of Sections 2.10, 2.13 and 8.04 (and other similar
     provisions of the other Loan Documents to survive the payment in full of
     the Obligations of the Loan Parties under or in respect of the Loan
     Documents) with respect to facts and circumstances occurring prior to the
     effective date of such assignment. Any assignment or transfer by a Lender
     of rights or obligations under this Agreement that does not comply with
     this paragraph 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 this Section 8.07(d).

          (c) The Administrative Agent, acting solely for this purpose as an
     agent of the Borrower, shall maintain at its office as set forth in Section
     8.02, a copy of each Assignment and Assumption delivered to it and a
     register for the recordation of the names and addresses of the Lender
     Parties, and the Commitments of, and principal amounts of the Advances
     owing to, each Lender pursuant to the terms hereof from time to time (the
     "Register"). The entries in the Register shall be conclusive, and the
     Borrower, the Administrative Agent and the Lender Parties may treat each
     Person whose name is recorded in the Register pursuant to the terms hereof
     as a Lender Party hereunder for all purposes of this Agreement,
     notwithstanding notice to the contrary. The Administrative Agent shall (i)
     upon the request by the Borrower or any Lender Party, provide a copy of the
     Register to the Borrower or such Lender Party, and (ii) upon its receipt of
     an Assignment and Assumption executed by an assigning Lender Party or
     Issuing Bank and an assignee, together with any Note or Notes subject to
     such assignment, if such Assignment and Assumption has been completed and
     is in substantially the form of Exhibit C hereto, (x) accept such
     Assignment and Assumption, and (y) record the information contained therein
     in the Register. In the case of any assignment by a Lender Party, the
     Borrower shall, at its own expense, and upon request by the Administrative
     Agent or any assignee, execute and deliver to

                                       100

<PAGE>

     the Administrative Agent in exchange for the surrendered Note or Notes a
     new Note or Notes from the Borrower payable to or to the order of such
     Eligible Assignee in an amount equal to the Commitment assumed by it under
     each Facility pursuant to such assignment and Assumption and, if the
     assigning Lender Party has retained a Commitment under such Facility, a new
     Note or Notes from the Borrower payable to or to the order of the assigning
     Lender Party in an amount equal to the Commitment retained by it under such
     Facility. Each of the new Note or Notes shall be in an aggregate principal
     amount equal to the aggregate principal amount of such surrendered Note or
     Notes, shall be dated the effective date of such Assignment and Assumption
     and shall otherwise be in substantially the form of Exhibit A-1, Exhibit
     A-2 or Exhibit A-3 hereto, as appropriate.

          (d) Any Lender Party 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 Party's rights and/or obligations under this
     Agreement (including all or a portion of its Commitment or Commitments, the
     Advances owing to it, the Note or Notes, if any, held by it and its
     participation, if any, in reimbursement obligations of the Borrower in
     respect of Letters of Credit); provided that:

               (i) such Lender Party's obligations under this Agreement shall
          remain unchanged,

               (ii) such Lender Party shall remain solely responsible to the
          other parties hereto for the performance of such obligations and

               (iii) the Borrower, the Administrative Agent and the other Lender
          Parties shall continue to deal solely and directly with such Lender
          Party in connection with such Lender Party's rights and obligations
          under this Agreement.

          Any agreement or instrument pursuant to which a Lender Party sells
     such a participation shall provide that such Lender Party 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 Party will not,
     without the consent of the Participant, agree to any amendment,
     modification or waiver described in Section 8.01(a) or (b) that affects
     such Participant. Subject to Section 8.07(e), the Borrower agrees that each
     Participant shall be entitled to the benefits of Sections 2.10, 2.13 and
     8.04 to the same extent as if it were a Lender Party and had acquired its
     interest by assignment pursuant to Section 8.07(a). To the extent permitted
     by law, each Participant also shall be entitled to the benefits of Section
     8.05 as though it were a Lender Party.

          (e) A Participant shall not be entitled to receive any greater payment
     under Sections 2.10, 2.13 and 8.04 than the applicable Lender Party 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 party if it were a Lender Party shall not be entitled
     to the benefits of Section 2.13 unless the Borrower is notified of the
     participation sold to such Participant and such Participant agrees, for the
     benefit of the Borrower, to comply with Section 2.13 as though it were a
     Lender Party.

          (f) Any Lender Party may at any time pledge or assign a security
     interest in all or any portion of its rights under this Agreement to secure
     obligations of such Lender Party,

                                       101

<PAGE>

     including without limitation any pledge or assignment to secure obligations
     to a Federal Reserve Bank; provided that no such pledge or assignment shall
     release such Lender Party from any of its obligations hereunder or
     substitute any such pledgee or assignee for such Lender Party as a party
     hereto. In the case of any Lender that is a fund that invests in bank
     loans, such Lender may, without the consent of the Borrower or
     Administrative Agent, assign or pledge all or any portion of its rights
     under this Agreement, including the Loans and Notes or any other instrument
     evidencing its rights as a Lender under this Agreement, to any holder of,
     trustee for, or any other representative of holders of, obligations owed or
     securities issued, by such fund, as security for such obligations or
     securities; provided that any foreclosure or similar action by such trustee
     or representative shall be subject to the provisions of this Section 8.07
     concerning assignments.

          (g) Notwithstanding anything to the contrary contained herein, any
     Lender Party (a "Granting Lender") may grant to a special purpose funding
     vehicle identified as such in writing from time to time by the Granting
     Lender to the Administrative Agent and the Borrower (an "SPC") the option
     to provide all or any part of any Advance that such Granting Lender would
     otherwise be obligated to make pursuant to this Agreement, provided that
     (i) nothing herein shall constitute a commitment by any SPC to fund any
     Advance, and (ii) if an SPC elects not to exercise such option or otherwise
     fails to make all or any part of such Advance, the Granting Lender shall be
     obligated to make such Advance pursuant to the terms hereof. The making of
     an Advance by an SPC hereunder shall utilize the Commitment of the Granting
     Lender to the same extent, and as if, such Advance were made by such
     Granting Lender. Each party hereto hereby agrees that (i) no SPC shall be
     liable for any indemnity or similar payment obligation under this Agreement
     for which a Lender Party would be liable, (ii) no SPC shall be entitled to
     the benefits of Sections 2.10 and 2.13 (or any other increased costs
     protection provision) and (iii) the Granting Lender shall for all purposes,
     including, without limitation, the approval of any amendment or waiver of
     any provision of any Loan Document, remain the Lender Party of record
     hereunder. In furtherance of the foregoing, each party hereto hereby agrees
     (which agreement shall survive the termination of this Agreement) that,
     prior to the date that is one year and one day after the payment in full of
     all outstanding commercial paper or other senior Debt of any SPC, it will
     not institute against, or join any other person in instituting against,
     such SPC any bankruptcy, reorganization, arrangement, insolvency, or
     liquidation proceeding under the laws of the United States or any State
     thereof. Notwithstanding anything to the contrary contained in this
     Agreement, any SPC may (i) with notice to, but without prior consent of,
     the Borrower and the Administrative Agent and without paying any processing
     fee therefor, assign all or any portion of its interest in any Advance to
     the Granting Lender and (ii) disclose on a confidential basis any
     non-public information relating to its funding of Advances to any rating
     agency, commercial paper dealer or provider of any surety or guarantee or
     credit or liquidity enhancement to such SPC. This subsection (g) may not be
     amended without the prior written consent of each Granting Lender, all or
     any part of whose Advances are being funded by the SPC at the time of such
     amendment.

          (h) In the event that the Borrower shall request that the Lender
     Parties enter into any amendment, modification, consent or waiver with
     respect to this Agreement or any other Loan Document, and any Lender Party
     elects not to enter into such amendment, modification, consent or waiver
     (each such Lender Party being a "Dissenting Lender"), then the Borrower
     shall have the right upon 10 days' written notice to the Administrative
     Agent and such Dissenting Lender, to require each such Dissenting Lender to
     assign 100% of the rights and obligations of the Dissenting Lender at par
     to any Lender or any other financial institution which satisfies the
     requirements of Section 8.07(a) and has been consented to by the
     Administrative Agent, the Swing Line Lender and in the case of any
     assignment of a Revolving Credit Commitment each Issuing Bank (which
     consents in the case of the Administrative Agent and the Swing Line Lender

                                       102

<PAGE>

     shall not be unreasonably withheld or delayed). Each such assignment shall
     be made pursuant to an Assignment and Assumption and shall comply with the
     other terms of this Section 8.07. The Borrower shall pay to such Dissenting
     Lender, concurrently with the effectiveness of such assignment, any amounts
     payable under this Agreement that would have been payable if the Borrower
     had voluntarily prepaid such Advances. The Dissenting Lender shall not be
     required to pay any fee relating to such assignment.

     SECTION 8.08. Execution in Counterparts. This Agreement may be executed in
                   -------------------------
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Delivery by telecopier of an executed counterpart of a signature page to this
Agreement shall be effective as delivery of an original executed counterpart of
this Agreement.

     SECTION 8.09. No Liability of the Issuing Bank. The Borrower assumes all
                   --------------------------------
risks of the acts or omissions of any beneficiary or transferee of any Letter of
Credit with respect to its use of such Letter of Credit. Neither the Issuing
Bank nor any of its officers or directors shall be liable or responsible for:
(a) the use that may be made of any Letter of Credit or any acts or omissions of
any beneficiary or transferee in connection therewith; (b) the validity,
sufficiency or genuineness of documents, or of any endorsement thereon, even if
such documents should prove to be in any or all respects invalid, insufficient,
fraudulent or forged; (c) payment by the Issuing Bank against presentation of
documents that do not comply with the terms of a Letter of Credit, including
failure of any documents to bear any reference or adequate reference to the
Letter of Credit; or (d) any other circumstances whatsoever in making or failing
to make payment under any Letter of Credit, except that the Borrower shall have
a claim against the Issuing Bank, and the Issuing Bank shall be liable to the
Borrower, to the extent of any direct, but not consequential, damages suffered
by the Borrower that the Borrower proves were caused by (i) the Issuing Bank's
willful misconduct or gross negligence, or failure to conform with the standards
specified in Section 5-108 of the UCC, as determined in a final, non-appealable
judgment by a court of competent jurisdiction in determining whether documents
presented under any Letter of Credit comply with the terms of the Letter of
Credit or (ii) the Issuing Bank's willful failure to make lawful payment under a
Letter of Credit after the presentation to it of a draft and certificates
strictly complying with the terms and conditions of the Letter of Credit. In
furtherance and not in limitation of the foregoing, but subject to Section
5-109(a) of the UCC, the Issuing Bank 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.

     SECTION 8.10. Confidentiality. Neither any Agent nor any Lender Party shall
                   ---------------
disclose any Confidential Information to any Person without the consent of the
Borrower, other than (a) to such Agent's or such Lender Party's Affiliates and
their officers, directors, employees, agents and advisors, to other Lender
Parties and to actual or prospective Eligible Assignees and participants, and
then only on a confidential basis, (b) as required by any law, rule or
regulation or judicial process, (c) as requested or required by any state,
Federal or foreign authority or examiner (including the National Association of
Insurance Commissioners or any similar organization or quasi-regulatory
authority) regulating such Lender Party, (d) to any rating agency when required
by it, provided that, prior to any such disclosure, such rating agency shall
undertake to preserve the confidentiality of any Confidential Information
relating to the Loan Parties received by it from such Lender Party in accordance
with such rating agency's internal procedures generally applicable to
information of the same type, (e) in connection with any litigation or
proceeding to which such Agent or such Lender Party or any of its Affiliates may
be a party, (f) in connection with the exercise of any remedy under this
Agreement or any other Loan Document, or (g) to any direct or indirect
contractual counterparty in swap agreements or such contractual counterparty's
professional advisor (so long as such contractual counterparty or professional
advisor to such contractual counterparty agrees to be bound by the provisions of
this Section 8.10).

                                       103

<PAGE>

     SECTION 8.11. Execution in Counterparts. This Agreement may be executed in
                   -------------------------
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Delivery of an executed counterpart of a signature page to this Agreement by
telecopier shall be effective as delivery of a manually executed counterpart of
this Agreement.

     SECTION 8.12. Governing Law, Jurisdiction, Etc.
                   ---------------------------------

          (a) This Agreement and the Notes shall be governed by, and construed
     in accordance with, the laws of the State of New York (without reference to
     conflict of laws provisions).

          (b) Each of the parties hereto hereby irrevocably and unconditionally
     submits, for itself and its property and assets, to the nonexclusive
     jurisdiction of any New York State court or any federal court of the United
     States of America sitting in New York City, New York, and any appellate
     court from any thereof, in any action or proceeding arising out of or
     relating to this Agreement or any of the other Loan Documents to which it
     is a party, or for recognition or enforcement of any judgment in respect
     thereof, and each of the parties hereto hereby irrevocably and
     unconditionally agrees that all claims in respect of any such action or
     proceeding may be heard and determined in any such New York State court or,
     to the fullest extent permitted under applicable law, in any such federal
     court. Each of the parties hereto hereby irrevocably consents to the
     service of copies of any summons and complaint and any other process which
     may be served in any such action or proceeding by certified mail, return
     receipt requested, or by delivering a copy of such process to such party,
     at its address specified in Section 8.02, or by any other method permitted
     under applicable law. Each of the parties hereto hereby 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 applicable law. Nothing in this Agreement shall affect
     any right that any of the parties hereto may otherwise have to bring any
     action or proceeding relating to this Agreement or any of the other Loan
     Documents in the courts of any jurisdiction.

          (c) Each of the parties hereto irrevocably and unconditionally waives,
     to the fullest extent it may legally and effectively do so, any objection
     that it may now or hereafter have to the laying of venue of any suit,
     action or proceeding arising out of or relating to this Agreement or any of
     the other Loan Documents to which it is a party in any New York State or
     federal court. Each of the parties hereto hereby irrevocably waives, to the
     fullest extent permitted by law, the defense of an inconvenient forum to
     the maintenance of such action or proceeding in any such court.

     SECTION 8.13. Designation as Designated Senior Debt. This Agreement, the
                   -------------------------------------
Subsidiary Guarantee, the Loan Documents and all monetary obligations hereunder
or thereunder are hereby expressly designated as "Designated Senior
Indebtedness" as that term (or any comparable term) is defined in the
Subordinated Notes Documents.

                                       104

<PAGE>

     SECTION 8.14. WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE AGENTS AND
                   --------------------
THE LENDER PARTIES IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE)
ARISING OUT OF OR RELATING TO ANY OF THE LOAN DOCUMENTS, THE ADVANCES, THE
LETTERS OF CREDIT OR THE ACTIONS OF ANY AGENT OR ANY LENDER PARTY IN THE
NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.

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

                                         DAVITA INC., as Borrower

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

<PAGE>

                                         CREDIT SUISSE FIRST BOSTON, CAYMAN
                                           ISLANDS BRANCH, as an Issuing Bank,
                                           as Swing Line Bank, as an Initial
                                           Lender, as a Book Manager and as
                                           Administrative Agent

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

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

<PAGE>

                                          BANK OF AMERICA, N.A., as Syndication
                                            Agent and an Initial Lender

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

<PAGE>

                                          BANC OF AMERICA SECURITIES LLC, as a
                                            Book Manager

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

<PAGE>

                                          THE BANK OF NEW YORK, as a
                                            Documentation Agent and an Initial
                                            Lender

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

<PAGE>

                                           THE BANK OF NOVA SCOTIA, as a
                                             Documentation Agent and an Initial
                                             Lender

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

<PAGE>

                                           WACHOVIA BANK, NATIONAL ASSOCIATION,
                                             as a Documentation Agent and an
                                             Initial Lender

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

<PAGE>

                                            CREDIT LYONNAIS NEW YORK BRANCH, as
                                              an Initial Lender

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

<PAGE>

                                             ABBEY NATIONAL TREASURY SERVICES
                                               PLC (U.S. BRANCH)

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

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

<PAGE>

                                   SCHEDULE I

                   COMMITMENTS AND APPLICABLE LENDING OFFICES
<TABLE>
<CAPTION>
=======================================================================================================================
                                   Term A            Term B       Revolving Credit     Swing Line    Letter of Credit
Name of Initial Lender Party     Commitment        Commitment        Commitment        Commitment    Commitment/1/
-----------------------------------------------------------------------------------------------------------------------
<S>                             <C>             <C>              <C>                    <C>          <C>
Credit Suisse First Boston,      $33,962,264.15   $850,000,000.00    $26,037,735.85   $25,000,000.00   $38,548,000.00
Cayman Islands Branch
11 Madison Avenue
New York, NY
10010-3629
-----------------------------------------------------------------------------------------------------------------------
Bank of America, N.A.            $33,962,264.15                      $26,037,735.85                    $11,452,000.00
100 North Tryon Street
15th Floor
Charlotte, NC  28255

-----------------------------------------------------------------------------------------------------------------------
The Bank of New York             $22,641,509.43                      $17,358,490.57
One Wall Street, 22nd Floor
New York, NY 10286

=======================================================================================================================
The Bank of Nova Scotia          $22,641,509.43                      $17,358,490.57
Loan Accounting
One Liberty Plaza, 24th Floor
New York, NY 10006

=======================================================================================================================
</TABLE>

<TABLE>
<CAPTION>
===========================================================================================
                                       Base Rate                     Eurodollar
                                       Lending                        Lending
Name of Initial Lender Party            Office                        Office
-------------------------------------------------------------------------------------------
<S>                           <C>                           <C>
Credit Suisse First Boston,   11 Madison Avenue             11 Madison Avenue
Cayman Islands Branch         New York, NY  10010-3629      New York, NY  10010-3629
11 Madison Avenue             Contact: William Lutkins      Contact: Nilsa Ware
New York, NY                  Phone:   (212) 325-9705       Phone:   (212) 322-5094
10010-3629                    Fax:     (212) 325-8319       Fax:     (212) 335-0593
-------------------------------------------------------------------------------------------
Bank of America, N.A.         Independence Centre, 15th Fl. Independence Centre, 15th Fl.
100 North Tryon Street        NC1-001-15-04                 NC1-001-15-04
15th Floor                    Charlotte, NC 28255           Charlotte, NC 28255
Charlotte, NC  28255          Attention: Elizabeth Garver   Attention: Elizabeth Garver
                              Phone:   (704) 388-1107       Phone:   (704) 388-1107
                              Fax:     (704) 386-9923       Fax:     (704) 386-9923
-------------------------------------------------------------------------------------------
The Bank of New York          The Bank of New York          The Bank of New York
One Wall Street, 22nd Floor   One Wall Street, 22nd Floor   One Wall Street, 22nd Floor
New York, NY 10286            New York, NY 10286            New York, NY 10286
                              Contact:  Zina Gregory        Contact:  Zina Gregory
                              Phone:   (212) 635-6732       Phone:   (212) 635-6732
                              Fax:     (212) 635-6397       Fax:     (212) 635-6397
===========================================================================================
The Bank of Nova Scotia       The Bank of Nova Scotia       The Bank of Nova Scotia
Loan Accounting               Loan Accounting               Loan Accounting
One Liberty Plaza, 24th Floor One Liberty Plaza, 24th Floor One Liberty Plaza, 24th Floor
New York, NY 10006            New York, NY 10006            New York, NY 10006
                              Contact:  Ross Coomber        Contact:  Ross Coomber
                              Phone:   (212) 225-5400       Phone:   (212) 225-5400
                              Fax:     (212) 225-6464       Fax:     (212) 225-6464
===========================================================================================
</TABLE>

--------
/1/  Less the aggregate amount of Existing Letters of Credit pursuant to Section
     2.01(e) in the amount of [$] as of the date hereof.

<PAGE>

<TABLE>
<CAPTION>
=======================================================================================================================
                                   Term A            Term B       Revolving Credit     Swing Line    Letter of Credit
Name of Initial Lender Party     Commitment        Commitment        Commitment        Commitment    Commitment/1/
-----------------------------------------------------------------------------------------------------------------------
<S>                             <C>               <C>            <C>                  <C>           <C>
Wachovia Bank,                   $22,641,509.43                      $17,358,490.57
  National Association
301 S. College Street, 5th
Floor
Charlotte, NC 28288-0760

-----------------------------------------------------------------------------------------------------------------------
Credit Lyonnais                  $8,490,566.04                       $6,509,433.96
  New York Branch
1301 Avenue of the Americas
New York, NY 10019

-----------------------------------------------------------------------------------------------------------------------
Abbey National Treasury          $5,660,377.36                       $4,339,622.64
Services plc (U.S. Branch)
400 Atlantic Street
Stamford, CT 06901

=======================================================================================================================
         TOTAL:                 $150,000,000.00   $850,000,000.00   $115,000,000.00   $25,000,000.00   $50,000,000.00
</TABLE>

<TABLE>
<CAPTION>
========================================================================================
Name of Initial Lender Party           Base Rate                     Eurodollar
                                       Lending                        Lending
                                        Office                        Office
----------------------------------------------------------------------------------------
<S>                       <C>                           <C>
Wachovia Bank,             Wachovia Bank,                Wachovia Bank,
  National Association       National Association          National Association
301 S. College Street,     301 S. College Street, 5th    301 S. College Street, 5th
5th Floor                  Floor                         Floor
Charlotte, NC 28288-0760   Charlotte, NC 28288-0760      Charlotte, NC 28288-0760
                           Contact:  Doug Davis          Contact:  Doug Davis
                                    Director                      Director
                           Phone:   (704) 715-2370       Phone:   (704) 715-2370
                           Fax:     (704) 374-4793       Fax:     (704) 374-4793
                           Email:   doug.davis@          Email:   doug.davis@
                                    wachovia.com                  wachovia.com
----------------------------------------------------------------------------------------
Credit Lyonnais             Credit Lyonnais               Credit Lyonnais
  New York Branch              New York Branch               New York Branch
1301 Avenue of the Americas  1301 Avenue of the Americas   1301 Avenue of the Americas
New York, NY 10019           New York, NY 10019            New York, NY 10019
                             Contact:  Gener David,        Contact:  Gener David,
                                      Loan Administrator            Loan Administrator
                             Phone:   (212) 261-7741       Phone:   (212) 261-7741
                             Fax:     (212) 459-3181       Fax:     (212) 459-3181
                             Email:   gener.david          Email: gener.david
                                      @CLAmericas.com      @CLAmericas.com

----------------------------------------------------------------------------------------
Abbey National Treasury    400 Atlantic Street           400 Atlantic Street
Services plc (U.S. Branch) Stamford, CT 06901            Stamford, CT 06901
400 Atlantic Street        Contact: Hans J. Scholz       Contact: Hans J. Scholz
Stamford, CT 06901         Phone:   (203) 355-7911       Phone:   (203) 355-7911
                           Fax:     (203) 355-8073       Fax:     (203) 355-8073
                           Email:   hans.scholz          Email:   hans.scholz
                                    @antsus.com                   @antsus.com
========================================================================================
</TABLE>

--------
/1/  Less the aggregate amount of Existing Letters of Credit pursuant to Section
     2.01(e) in the amount of [$] as of the date hereof.

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