Document:

Exhibit 10.1

 

[EXECUTION COPY]

 

Published CUSIP Number:
93005EAA7

 

 

 

CREDIT AGREEMENT

 

dated as of August 31, 2010

 

among

 

WADDELL & REED FINANCIAL, INC.,

 

THE LENDERS PARTY HERETO,

 

and

 

BANK OF AMERICA, N.A.,

as Administrative Agent

 

 

BANC OF AMERICA SECURITIES LLC,

as Lead Arranger and Book Manager

 

UMB BANK, N.A. and THE BANK OF NOVA SCOTIA,

as Co-Syndication Agents

 

CITIBANK, N.A. and WELLS FARGO BANK, NATIONAL
ASSOCIATION

as Co-Documentation Agents

 

 

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  ARTICLE I

  	
  DEFINITIONS

  	
  1

  
	
   

  	
   

  	
   

  
	
  SECTION 1.01.

  	
  Defined
  Terms

  	
  1

  
	
  SECTION 1.02.

  	
  Terms
  Generally

  	
  18

  
	
  SECTION 1.03.

  	
  Accounting
  Terms; GAAP

  	
  18

  
	
   

  	
   

  	
   

  
	
  ARTICLE II 

  	
  THE
  CREDITS

  	
  19

  
	
   

  	
   

  	
   

  
	
  SECTION 2.01.

  	
  Commitments

  	
  19

  
	
  SECTION 2.02.

  	
  Loans
  and Borrowings

  	
  19

  
	
  SECTION 2.03.

  	
  Requests
  for Borrowings, Conversions and Continuations of Loans

  	
  19

  
	
  SECTION 2.04.

  	
  Funding
  of Borrowings

  	
  21

  
	
  SECTION 2.05.

  	
  Termination
  and Reduction of Commitments

  	
  22

  
	
  SECTION 2.06.

  	
  Repayment
  of Loans; Evidence of Debt

  	
  22

  
	
  SECTION 2.07.

  	
  Prepayment
  of Loans

  	
  23

  
	
  SECTION 2.08.

  	
  Fees

  	
  24

  
	
  SECTION 2.09.

  	
  Interest

  	
  24

  
	
  SECTION 2.10.

  	
  Alternate
  Rate of Interest

  	
  25

  
	
  SECTION 2.11.

  	
  Increased
  Costs

  	
  26

  
	
  SECTION 2.12.

  	
  Break
  Funding Payments

  	
  27

  
	
  SECTION 2.13.

  	
  Taxes

  	
  28

  
	
  SECTION 2.14.

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

  	
  31

  
	
  SECTION 2.15.

  	
  Mitigation
  Obligations; Replacement of Lenders

  	
  33

  
	
  SECTION 2.16.

  	
  Increase
  in Commitments

  	
  34

  
	
  SECTION 2.17.

  	
  Defaulting
  Lenders

  	
  35

  
	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
  REPRESENTATIONS
  AND WARRANTIES

  	
  36

  
	
   

  	
   

  	
   

  
	
  SECTION 3.01.

  	
  Organization;
  Powers

  	
  36

  
	
  SECTION 3.02.

  	
  Authorization;
  Enforceability

  	
  36

  
	
  SECTION 3.03.

  	
  Governmental
  Approvals; No Conflicts

  	
  37

  
	
  SECTION 3.04.

  	
  Financial
  Condition; No Material Adverse Effect

  	
  37

  
	
  SECTION 3.05.

  	
  Properties

  	
  37

  
	
  SECTION 3.06.

  	
  Litigation
  and Environmental Matters

  	
  38

  
	
  SECTION 3.07.

  	
  Compliance
  with Laws and Agreements

  	
  38

  
	
  SECTION 3.08.

  	
  Investment
  and Holding Company Status

  	
  38

  
	
  SECTION 3.09.

  	
  Taxes

  	
  39

  
	
  SECTION 3.10.

  	
  ERISA
  Compliance

  	
  39

  
	
  SECTION 3.11.

  	
  Disclosure

  	
  40

  
	
  SECTION 3.12.

  	
  No
  Default

  	
  40

  
				

 

i

 

TABLE OF CONTENTS

(continued)

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  SECTION 3.13.

  	
  Subsidiaries

  	
  40

  
	
  SECTION 3.14.

  	
  Federal
  Regulations

  	
  41

  
	
  SECTION 3.15.

  	
  No
  Burdensome Restrictions

  	
  41

  
	
  SECTION 3.16.

  	
  Insurance

  	
  41

  
	
  SECTION 3.17.

  	
  Taxpayer
  Identification Number

  	
  41

  
	
  SECTION 3.18.

  	
  Foreign
  Assets Control Regulations, Etc

  	
  41

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV

  	
  CONDITIONS

  	
  42

  
	
   

  	
   

  	
   

  
	
  SECTION 4.01.

  	
  Conditions
  to Closing Date

  	
  42

  
	
  SECTION 4.02.

  	
  Each
  Credit Event

  	
  44

  
	
   

  	
   

  	
   

  
	
  ARTICLE V

  	
  AFFIRMATIVE
  COVENANTS

  	
  44

  
	
   

  	
   

  	
   

  
	
  SECTION 5.01.

  	
  Financial
  Statements and Other Information

  	
  45

  
	
  SECTION 5.02.

  	
  Notices
  of Material Events

  	
  47

  
	
  SECTION 5.03.

  	
  Existence;
  Conduct of Business

  	
  48

  
	
  SECTION 5.04.

  	
  Payment
  of Obligations

  	
  48

  
	
  SECTION 5.05.

  	
  Maintenance
  of Properties; Insurance

  	
  48

  
	
  SECTION 5.06.

  	
  Books
  and Records; Inspection Rights

  	
  48

  
	
  SECTION 5.07.

  	
  Compliance
  with Laws

  	
  49

  
	
  SECTION 5.08.

  	
  Use
  of Proceeds

  	
  49

  
	
  SECTION 5.09.

  	
  Environmental
  Laws

  	
  49

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI

  	
  NEGATIVE
  COVENANTS

  	
  49

  
	
   

  	
   

  	
   

  
	
  SECTION 6.01.

  	
  Financial
  Condition Covenants

  	
  49

  
	
  SECTION 6.02.

  	
  Indebtedness

  	
  49

  
	
  SECTION 6.03.

  	
  Liens

  	
  50

  
	
  SECTION 6.04.

  	
  Fundamental
  Changes

  	
  51

  
	
  SECTION 6.05.

  	
  Acquisitions;
  Hedging Agreements

  	
  52

  
	
  SECTION 6.06.

  	
  Restricted
  Payments

  	
  52

  
	
  SECTION 6.07.

  	
  Transactions
  with Affiliates

  	
  52

  
	
  SECTION 6.08.

  	
  Restrictive
  Agreements

  	
  52

  
	
  SECTION 6.09.

  	
  Sales
  and Leasebacks

  	
  53

  
	
  SECTION 6.10.

  	
  Changes
  in Fiscal Periods

  	
  53

  
	
  SECTION 6.11.

  	
  Optional
  Payments and Modifications of Certain Debt Instruments

  	
  53

  
	
  SECTION 6.12.

  	
  Use
  of Proceeds

  	
  53

  
	
  SECTION 6.13.

  	
  OFAC,
  Etc

  	
  54

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII

  	
  EVENTS
  OF DEFAULT

  	
  54

  
					

 

ii

 

TABLE OF CONTENTS

(continued)

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  	
  THE
  ADMINISTRATIVE AGENT

  	
  57

  
	
   

  	
   

  	
   

  
	
  SECTION 8.01.

  	
  Appointment
  and Authority

  	
  57

  
	
  SECTION 8.02.

  	
  Rights
  as a Lender

  	
  57

  
	
  SECTION 8.03.

  	
  Exculpatory
  Provisions

  	
  57

  
	
  SECTION 8.04.

  	
  Reliance
  by Administrative Agent

  	
  58

  
	
  SECTION 8.05.

  	
  Delegation
  of Duties

  	
  58

  
	
  SECTION 8.06.

  	
  Resignation
  of Administrative Agent

  	
  59

  
	
  SECTION 8.07.

  	
  Non-Reliance
  on Administrative Agent and Other Lenders

  	
  59

  
	
  SECTION 8.08.

  	
  No
  Other Duties, Etc

  	
  60

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX

  	
  MISCELLANEOUS

  	
  60

  
	
   

  	
   

  	
   

  
	
  SECTION 9.01.

  	
  Notices;
  Effectiveness; Electronic Communication

  	
  60

  
	
  SECTION 9.02.

  	
  Waivers;
  Amendments; Enforcement

  	
  62

  
	
  SECTION 9.03.

  	
  Expenses;
  Indemnity; Damage Waiver

  	
  63

  
	
  SECTION 9.04.

  	
  Successors
  and Assigns

  	
  65

  
	
  SECTION 9.05.

  	
  Survival

  	
  69

  
	
  SECTION 9.06.

  	
  Counterparts;
  Integration; Effectiveness

  	
  69

  
	
  SECTION 9.07.

  	
  Severability

  	
  69

  
	
  SECTION 9.08.

  	
  Right
  of Setoff

  	
  70

  
	
  SECTION 9.09.

  	
  Governing
  Law; Jurisdiction; Consent to Service of Process

  	
  70

  
	
  SECTION 9.10.

  	
  WAIVER
  OF JURY TRIAL

  	
  71

  
	
  SECTION 9.11.

  	
  Headings

  	
  71

  
	
  SECTION 9.12.

  	
  Confidentiality

  	
  71

  
	
  SECTION 9.13.

  	
  Interest
  Rate Limitation

  	
  72

  
	
  SECTION 9.14.

  	
  No
  Advisory or Fiduciary Responsibility

  	
  72

  
	
  SECTION 9.15.

  	
  USA
  Patriot Act

  	
  73

  
				

 

iii

 

	
  SCHEDULES:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Schedule
  2.01

  	
  —

  	
  Commitments

  
	
  Schedule
  3.04

  	
  —

  	
  Financial
  Condition

  
	
  Schedule
  3.06

  	
  —

  	
  Disclosed
  Matters

  
	
  Schedule
  3.10

  	
  —

  	
  Pension
  Plans

  
	
  Schedule
  3.13

  	
  —

  	
  Subsidiaries

  
	
  Schedule
  6.02

  	
  —

  	
  Existing
  Indebtedness

  
	
  Schedule
  6.03

  	
  —

  	
  Existing
  Liens

  
	
  Schedule
  6.08

  	
  —

  	
  Existing
  Restrictions

  
	
  Schedule
  6.09

  	
  —

  	
  Sale/Leaseback
  Properties

  
	
  Schedule
  9.01

  	
  —

  	
  Administrative
  Agent’s Office; Certain Addresses for Notices

  
	
   

  	
   

  	
   

  
	
  EXHIBITS:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Exhibit A

  	
  —

  	
  Form of
  Assignment and Acceptance

  
	
  Exhibit B

  	
  —

  	
  Form of
  Note

  
	
  Exhibit C-1

  	
  —

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

  
	
  Exhibit C-2

  	
  —

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

  
	
  Exhibit D

  	
  —

  	
  Form of
  Revolving Borrowing Request

  
	
  Exhibit E

  	
  —

  	
  Form of
  Compliance Certificate

  

 

iv

 

 

CREDIT AGREEMENT

 

This
CREDIT AGREEMENT is entered into as of August 31,
2010, among WADDELL & REED FINANCIAL, INC.
(the “Borrower”), the several financial institutions from time to time
party hereto (collectively, the “Lenders” and each individually, a “Lender”),
and BANK OF AMERICA, N.A. (“Bank of
America”), as administrative agent for the Lenders (in such capacity,
together with any successors thereto in such capacity, the “Administrative
Agent”).

 

ARTICLE I

 

Definitions

 

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

 

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

 

“Act”
has the meaning Specified in Section 9.15.

 

“Adjusted
LIBO Rate” means a rate per annum determined by the Administrative Agent
pursuant to the following formula:

 

	
  Adjusted
  LIBO Rate =

  	
  LIBO Rate

  	
   

  
	
  1.00 – Eurodollar Reserve Percentage

  	
   

  

 

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

 

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

 

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

 

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

 

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

 

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

 

 

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

 

“Applicable
Percentage” means, with respect to any Lender, the percentage (carried to
the ninth decimal place) of the total Commitments represented by such Lender’s
Commitment.  If the Commitments have
terminated or expired, the Applicable Percentages shall be determined based
upon the Commitments most recently in effect, giving effect to any assignments,
subject, in each case, to adjustments pursuant to Section 2.17.

 

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

 

	
  Pricing
  

  Level

  	
   

  	
  Debt Rating

  	
   

  	
  Facility Fee

  	
   

  	
  Eurodollar Loans

  	
   

  	
  ABR Loans

  	
   

  
	
  1

  	
   

  	
  > A- / A3

  	
   

  	
  0.250

  	
  %

  	
  1.650

  	
  %

  	
  0.650

  	
  %

  
	
  2

  	
   

  	
  BBB+
  / Baa1

  	
   

  	
  0.300

  	
  %

  	
  1.950

  	
  %

  	
  0.950

  	
  %

  
	
  3

  	
   

  	
  BBB
  / Baa2

  	
   

  	
  0.375

  	
  %

  	
  2.125

  	
  %

  	
  1.125

  	
  %

  
	
  4

  	
   

  	
  BBB-
  / Baa3

  	
   

  	
  0.500

  	
  %

  	
  2.250

  	
  %

  	
  1.250

  	
  %

  
	
  5

  	
   

  	
  <
  BBB- / Baa3

  	
   

  	
  0.600

  	
  %

  	
  2.650

  	
  %

  	
  1.650

  	
  %

  

 

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

 

Initially,
the Applicable Rate shall be the percentages per annum set forth opposite
Pricing Level 3.  The Applicable Rate
shall be subject to adjustment (upwards or downwards, as appropriate), 

 

2

 

effective
as of the date on which S&P or Moody’s announces a rating change which
results in a change in the Applicable Rate.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

“Capital
Lease Obligations” of any Person means the obligations of such Person to
pay rent or other amounts under any lease of (or other arrangement conveying
the right to use) real or personal property, or a combination thereof, which
obligations are required to be 

 

3

 

classified
and accounted for as capital leases on a balance sheet of such Person under
GAAP, and the amount of such obligations shall be the capitalized amount
thereof determined in accordance with GAAP.

 

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

 

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

 

(a)           any “person” or “group”
(as such terms are used in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934, but excluding any employee benefit plan of such person or
its subsidiaries, and any person or entity acting in its capacity as trustee,
agent or other fiduciary or administrator of any such plan) becomes the “beneficial
owner” (as defined in Rules 13d-3 and 13d-5 under the Securities Exchange
Act of 1934, except that a person or group shall be deemed to have “beneficial
ownership” of all securities that such person or group has the right to
acquire, whether such right is exercisable immediately or only after the
passage of time (such right, an “option right”)), directly or
indirectly, of 25% or more of the equity securities of the Borrower entitled to
vote for members of the board of directors or equivalent governing body of the
Borrower on a fully-diluted basis (and taking into account all such securities
that such person or group has the right to acquire pursuant to any option
right);

 

(b)           during any period of
12 consecutive months, a majority of the members of the board of directors or
other equivalent governing body of the Borrower cease to be composed of
individuals (i) who were members of that board or equivalent governing
body on the first day of such period, (ii) whose election or nomination to
that board or equivalent governing body was approved by individuals referred to
in clause (i) above constituting at the time of such election or
nomination at least a majority of that board or equivalent governing body or (iii) whose
election or nomination to that board or other equivalent governing body was
approved by individuals referred to in clauses (i) and (ii) above
constituting at the time of such election or nomination at least a majority of
that board or equivalent governing body (excluding, in the case of both clause (ii) and
clause (iii), any individual whose initial nomination for, or assumption of
office as, a member of that board or equivalent governing body occurs as a
result of an actual or threatened solicitation of proxies or consents for the
election or removal of one or more directors by any person or group other than
a solicitation for the election of one or more directors by or on behalf of the
board of directors); or

 

(c)           any Person or two or
more Persons acting in concert shall have acquired by contract or otherwise, or
shall have entered into a contract or arrangement that, upon consummation
thereof, will result in its or their acquisition of control over the equity
securities of the Borrower entitled to vote for members of the board of
directors or equivalent governing body of the Borrower on a fully-diluted basis
(and taking into 

 

4

 

account
all such securities that such Person or group has the right to acquire pursuant
to any option right) representing 25% or more of the combined voting power of
such securities.

 

“Change
in Law” means (a) the adoption of any law, rule or regulation
after the date of this Agreement, (b) any change in any law, rule or
regulation or in the interpretation or application thereof by any Governmental
Authority after the date of this Agreement, or (c) compliance by any
Lender (or, for purposes of Section 2.11(b), by any lending office
of such Lender or by such Lender’s holding company, if any) with any request,
guideline or directive (whether or not having the force of law) of any
Governmental Authority made or issued after the date of this Agreement.

 

“Closing
Date” means the date on which the conditions precedent set forth in Section 4.01
shall have been satisfied, which date is August 31, 2010.

 

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

 

“Commitment”
means, with respect to each Lender, the commitment of such Lender to make Loans
hereunder, expressed as an amount representing the maximum aggregate
outstanding principal amount of such Lender’s Loans hereunder, as such
commitment may be (a) reduced from time to time pursuant to Section 2.05,
(b) reduced or increased from time to time pursuant to assignments by or
to such Lender pursuant to Section 9.04, and (c) increased
from time to time pursuant to Section 2.16.  The initial amount of each Lender’s
Commitment is set forth on Schedule 2.01, or in the Assignment and
Acceptance pursuant to which such Lender shall have assumed its Commitment, as
applicable, and the initial aggregate amount of the Commitments of the Lenders
(as set forth on Schedule 2.01) is $125,000,000.

 

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

 

“Confidential
Information Memorandum” means the Confidential Information Memorandum dated
August 2010 and furnished to the Lenders.

 

“Consolidated
EBITDA” means, for any period, Consolidated Net Income for such period plus
(a) without duplication and to the extent reflected as a charge in the
statement of such Consolidated Net Income for such period, the sum of (i) income
tax expense, (ii) interest expense, amortization or writeoff of debt
discount and debt issuance costs and commissions, discounts and other fees and
charges associated with Indebtedness (including the Loans), (iii) depreciation
and amortization expense, (iv) amortization of intangibles (including, but
not limited to, goodwill) and organization costs, (v) any extraordinary,
unusual or non-recurring non-cash expenses or losses (including, whether or not
otherwise includable as a separate item in the statement of such Consolidated
Net Income for such period, non-cash losses on sales of assets outside of the
ordinary course of business), provided, that the amounts referred to in
this clause (v) shall not, in the aggregate, exceed $10,000,000 for
any fiscal year of the Borrower, and (vi) any other non-cash charges, minus
(b) without duplication and to the extent reflected as income 

 

5

 

in
the statement of such Consolidated Net Income for such period, any
extraordinary, unusual or non-recurring non-cash income or gains (including,
whether or not otherwise includable as a separate item in the statement of such
Consolidated Net Income for such period, non-cash gains on sales of assets
outside of the ordinary course of business), provided that the Borrower
shall not be required to deduct more than $10,000,000 in the aggregate of the
amounts referred to in this clause (b) for any fiscal year of the
Borrower.  For the purposes of
calculating Consolidated EBITDA for any Reference Period pursuant to any
determination of the Consolidated Leverage Ratio, (x) if at any time
during such Reference Period the Borrower or any Subsidiary shall have made any
Material Disposition (as defined below), the Consolidated EBITDA for such
Reference Period shall be reduced by an amount equal to the Consolidated EBITDA
(if positive) attributable to the property that is the subject of such Material
Disposition for such Reference Period or increased by an amount equal to the
Consolidated EBITDA (if negative) attributable thereto for such Reference
Period, and (y) if during such Reference Period the Borrower or any
Subsidiary shall have made a Material Acquisition (as defined below),
Consolidated EBITDA for such Reference Period shall be calculated after giving pro
forma effect thereto as if such Material Acquisition occurred on the
first day of such Reference Period.  As
used in this definition, “Material Acquisition” means any acquisition of
property or series of related acquisitions of property that (i) constitutes
assets comprising all or substantially all of an operating unit of a business
or constitutes all or substantially all of the common stock of a Person and (2) involves
the payment of consideration by the Borrower and its Subsidiaries in excess of
$1,000,000; and “Material Disposition” means any Disposition of property or
series of related Dispositions of property that yields gross proceeds to the
Borrower or any of its Subsidiaries in excess of $1,000,000.

 

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

 

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

 

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

 

“Consolidated
Net Income” means, for any period, the consolidated net income (or loss) of
the Borrower and its Subsidiaries, determined on a consolidated basis in
accordance with GAAP; provided that there shall be excluded (a) the
income (or deficit) of any Person accrued prior to the date it becomes a
Subsidiary of the Borrower or is merged into or consolidated with the Borrower
or any of its Subsidiaries, (b) the income (or deficit) of any Person
(other than a Subsidiary of the Borrower) in which the Borrower or any of its
Subsidiaries has an ownership interest, except to the extent that any such
income is actually received by the Borrower or such Subsidiary in the form of
dividends or similar distributions, and (c) the 

 

6

 

undistributed
earnings of any Subsidiary of the Borrower to the extent that the declaration
or payment of dividends or similar distributions by such Subsidiary is not at
the time permitted by the terms of any Contractual Obligation or Requirement of
Law applicable to such Subsidiary.

 

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

 

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

 

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

 

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

 

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

 

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

 

“Defaulting Lender”
means any Lender that, as determined by the Administrative Agent, (a) has
failed to perform its obligation to fund any portion of its Loans within one
Business Day of the date required to be funded by it hereunder, (b) has
notified the Borrower, the Administrative Agent or any Lender in writing that
it does not intend to comply with any of its funding obligations under this
Agreement or has made a public statement that it does not intend to comply with
its funding obligations under this Agreement or generally under other
agreements in which it commits to extend credit, (c) has failed, within
one Business Day after written request by the Administrative Agent, to confirm
in a manner satisfactory to the Administrative Agent, that it will comply with
the terms of this Agreement relating to its obligations to fund prospective
Loans, (d) otherwise has failed to pay over to the Administrative Agent or
any other Lender any other amount required to be paid by it hereunder within
one Business Day of the date when due, unless the subject of a good faith
dispute, or (e) has, or has a direct or indirect parent company that has, (i) become
the subject of a proceeding under any bankruptcy or insolvency proceeding, or (ii) had
a receiver, conservator, trustee, administrator, assignee for the benefit of
creditors or similar Person charged with reorganization or liquidation of its
business or a custodian appointed 

 

7

 

for
it, or (iii) taken any action in furtherance of, or indicating its consent
to, approval of or acquiescence in any such proceeding or appointment; provided
that a Lender shall not be a Defaulting Lender solely by virtue of the
ownership or acquisition of any equity interest in such Lender or direct or
indirect parent company thereof by a Governmental Authority.  A Lender that has become a Defaulting Lender
because of an event referenced in this definition may cure such status and
shall no longer constitute a Defaulting Lender as provided in Section 2.17(d).

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

8

 

“ERISA
Event” means (a) a Reportable Event with respect to a Pension Plan;
(b) the withdrawal of the Borrower or any ERISA Affiliate from a Pension
Plan subject to Section 4063 of ERISA during a plan year in which such
entity was a “substantial employer” as defined in Section 4001(a)(2) of
ERISA or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA
Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan
is in reorganization; (d) the filing of a notice of intent to terminate,
the treatment of a Pension Plan amendment as a termination under Section 4041
or 4041A of ERISA; (e) the institution by the PBGC of proceedings to terminate
a Pension Plan; (f) any event or condition which constitutes grounds under
Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan; or (g) the imposition of any
liability under Title IV of ERISA, other than for PBGC premiums due but not
delinquent under Section 4007 of ERISA, upon  the Borrower or any ERISA Affiliate.

 

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

 

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

 

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

 

“Excluded
Taxes” means, with respect to the Administrative Agent, any Lender, or any
other recipient of any payment to be made by or on account of any obligation of
the Borrower hereunder, (a) income or franchise taxes imposed on (or
measured by) its net income by the United States of America, or by the
jurisdiction under the laws of which such recipient is organized or in which
its principal office is located or, in the case of any Lender, in which its
applicable lending office is located, (b) any backup withholding or branch
profits taxes imposed by the United States of America or any similar tax
imposed by any other jurisdiction in which the Borrower is located, (c) in
the case of a Foreign Lender (other than an assignee pursuant to a request by
the Borrower under Section 2.15(b)), any withholding tax that is
imposed on amounts payable to such Foreign Lender at the time such Foreign
Lender becomes a party to this Agreement or is attributable to such Foreign
Lender’s failure or inability to comply with Section 2.13(e),
except to the extent that such Foreign Lender’s assignor (if any) was entitled,
at the time of assignment, to receive additional amounts from the Borrower with
respect to such withholding tax pursuant to Section 2.13(a) and
(d) any withholding taxes and any penalties and interest with respect
thereto that are imposed as a result of the failure by a Lender that is either
a “foreign financial institution” or a “non-financial foreign entity” (each
within the meaning of Sections 1471 through 1474 of the Code and any
regulations promulgated thereunder) to comply with the 

 

9

 

requirements
of Sections 1471 through 1474 of the Code (including any successor provisions
thereof) and any regulations promulgated thereunder or official interpretations
thereof to establish an exemption from withholding thereunder.

 

“Existing
Credit Agreement” means the Credit Agreement, dated as of October 5,
2009, among the Borrower, certain financial institutions party thereto as
lenders and Bank of America, N.A., as administrative agent for such lenders.

 

“Federal
Funds Effective Rate” means, for any day, the rate per annum equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day; provided that (a) if such day is not a
Business Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Business Day as so published on the next
succeeding Business Day, and (b) if no such rate is so published on such
next succeeding Business Day, the Federal Funds Effective Rate for such day
shall be the average rate (rounded upward, if necessary, to a whole multiple of
1/100 of 1%) charged to Bank of America on such day on such transactions as
determined by the Administrative Agent.

 

“Fee
Letter” means the letter agreement, dated as of July 6, 2010, among
the Borrower, the Administrative Agent and the Arranger.

 

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

 

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

 

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

 

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

 

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

 

10

 

 

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

 

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

 

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

 

“Increase
Effective Date” has the meaning specified in Section 2.16(a).

 

“Increasing
Lender” has the meaning specified in Section 2.16(a).

 

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

 

11

 

of
any other entity (including any partnership in which such Person is a general
partner) to the extent such Person is liable therefor as a result of such
Person’s ownership interest in or other relationship with such entity, except
to the extent the terms of such Indebtedness provide that such Person is not
liable therefor.

 

“Indemnified
Taxes” means Taxes other than Excluded Taxes.

 

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

 

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

 

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

 

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

 

12

 

(b) for
any interest calculation with respect to clause (c) of the definition of “Alternate
Base Rate” on any date, the rate per annum equal to (i) BBA LIBOR, at
approximately 11:00 a.m., London time determined two London Banking Days
prior to such date for Dollar deposits being delivered in the London interbank
market for a term of one month commencing that day or (ii) if such
published rate is not available at such time for any reason, the rate per annum
determined by the Administrative Agent to be the rate at which deposits in
Dollars for delivery on the date of determination in same day funds in the
approximate amount of the ABR Loan being made or maintained and with a term
equal to one month would be offered by Bank of America’s London Branch to major
banks in the London interbank Eurodollar market at their request at the date
and time of determination.

 

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

 

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

 

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

 

“Management
Contract” means an agreement, written or oral, pursuant to which the
Borrower or any Subsidiary of the Borrower provides (a) investment advisory,
management or administrative services to a W&R Fund, or (b) investment
advisory or management services to any Person, including, without limitation,
unregistered investment companies and personal or corporate investment
accounts.

 

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

 

“Material
Indebtedness” means Indebtedness (other than the Loans), or obligations in
respect of one or more Hedging Agreements, of any one or more of the Borrower
and its Subsidiaries in an aggregate principal amount exceeding
$10,000,000.  For purposes of determining
Material Indebtedness, the “principal amount” of the obligations of the
Borrower or any Subsidiary in respect of any Hedging Agreement at any time
shall be the maximum aggregate amount (giving effect to any netting agreements)
that the Borrower or such Subsidiary would be required to pay if such Hedging
Agreement were terminated at such time.

 

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

 

13

 

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

 

“Multiple
Employer Plan” means a Plan which has two or more contributing sponsors
(including the Borrower or any ERISA Affiliate) at least two of whom are not
under common control, as such a plan is described in Section 4064 of
ERISA.

 

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

 

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

 

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

 

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

 

“Participating
Lender” has the meaning specified in Section 2.16(a).

 

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

 

“Pension
Act” means the Pension Protection Act of 2006.

 

“Pension
Funding Rules” means the rules of the Code and ERISA regarding minimum
required contributions (including any installment payment thereof) to Pension
Plans and set forth in, with respect to plan years ending prior to the
effective date of the Pension Act, Section 412 of the Code and Section 302
of ERISA, each as in effect prior to the Pension Act and, thereafter, Section 412,
430, 431, 432 and 436 of the Code and Sections 302, 303, 304 and 305 of ERISA.

 

“Pension
Plan” means any employee pension benefit plan (including a Multiple
Employer Plan or a Multiemployer Plan) that is maintained or is contributed to
by the Borrower and any ERISA Affiliate and is either covered by Title IV of
ERISA or is subject to the minimum funding standards under Section 412 of
the Code.

 

“Permitted
Acquisition” means an acquisition of a Person, or the assets of a Person or
a line of business of a Person, in the same or a related line of business as
the Borrower, provided that after giving effect to such acquisition (a) no
Default or Event of Default shall have 

 

14

 

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

 

“Permitted
Encumbrances” means:

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

“Plan”
means any employee benefit plan within the meaning of Section 3(3) of
ERISA (including a Pension Plan), maintained for employees of the Borrower or
any ERISA Affiliate or any such Plan to which the Borrower or any ERISA
Affiliate is required to contribute on behalf of any of its employees.

 

15

 

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

 

“Reference
Period” means, at any date of determination, the most recently completed
four fiscal quarters of the Borrower.

 

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

 

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

 

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

 

“Required
Lenders” means Lenders having Revolving Credit Exposures and unused
Commitments representing at least 51% of the sum of the aggregate Revolving
Credit Exposures and unused Commitments of all Lenders at such time; provided
that the unused Commitment of, and the portion of the aggregate Revolving
Credit Exposures held or deemed held by, any Defaulting Lender shall be
excluded for purposes of making a determination of Required Lenders.

 

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

 

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

 

“Revenue
Base” means the sum of (a) the product of (i) with respect to
each W&R Fund, the Net Asset Value of the W&R Fund on the date of
calculation and with respect to assets managed for other entities, the market
value or Net Asset Value of such assets on the date of calculation, and (ii) the
rate provided for in the applicable Management Contract for 

 

16

 

determining
the annual fee required for such advisory, management or administrative
services on such date, and (b) Distribution Fees for such W&R Fund.

 

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

 

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

 

“Revolving
Credit Termination Date” means August 30, 2013 or such earlier date as
the Commitments shall terminate pursuant to the terms hereof (or, if such day
is not a Business Day, the next preceding Business Day).

 

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

 

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

 

“Senior
Notes” means the senior notes of the Borrower issued pursuant to the Senior
Note Agreement.

 

“Senior
Note Agreement” means that certain Note Purchase Agreement, dated as of August 31,
2010, among the Borrower and each of the purchasers identified on the signature
pages thereof.

 

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

 

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

 

“Subsidiary”
means any subsidiary of the Borrower.

 

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

 

17

 

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

 

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

 

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

 

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

 

SECTION 1.02. 
Terms Generally.  The
definitions of terms herein shall apply equally to the singular and plural
forms of the terms defined.  Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms.  The words “include”,
“includes” and “including” shall be deemed to be followed by the phrase “without
limitation”.  The word “will” shall be
construed to have the same meaning and effect as the word “shall”.  Unless the context requires otherwise (a) any
definition of or reference to any agreement, instrument or other document herein
shall be construed as referring to such agreement, instrument or other document
as from time to time amended, supplemented or otherwise modified (subject to
any restrictions on such amendments, supplements or modifications set forth
herein), (b) any reference herein to any Person shall be construed to
include such Person’s successors and assigns, (c) the words “herein”, “hereof”
and “hereunder”, and words of similar import, shall be construed to refer to
this Agreement in its entirety and not to any particular provision hereof, (d) all
references herein to Articles, Sections, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Exhibits and Schedules to,
this Agreement, and (e) the words “asset” and “property” shall be construed
to have the same meaning and effect and to refer to any and all tangible and
intangible assets and properties, including cash, securities, accounts and
contract rights.

 

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

 

18

 

ARTICLE II

 

The Credits

 

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

 

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

 

(b)           Subject to Section 2.10,
each Borrowing shall be comprised entirely of ABR Loans or Eurodollar Loans as
the Borrower may request in accordance herewith.  Each Lender at its option may make any
Eurodollar Loan by causing any domestic or foreign branch or Affiliate of such
Lender to make such Loan; provided that any exercise of such option
shall not affect the obligation of the Borrower to repay such Loan in
accordance with the terms of this Agreement.

 

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

 

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

 

SECTION 2.03. 
Requests for Borrowings, Conversions and Continuations of Loans.  Each Borrowing, each conversion of Loans from
one Type to the other, and each continuation of Eurodollar Loans shall be made
upon the Borrower’s irrevocable notice to the Administrative Agent, which may
be given by telephone.  Each such notice
must be received by the Administrative Agent not later than 10:00 a.m.,
New York City time (a) three (3) Business Days before the date of the
proposed Borrowing of, conversion to or continuation of Eurodollar 

 

19

 

Loans
or of any conversion of Eurodollar Loans to ABR Loans, or (b) one (1) Business
Day before the date of the proposed Borrowing of any ABR Loans.  Each telephonic notice by the Borrower
pursuant to this Section 2.03 must be confirmed promptly by
delivery to the Administrative Agent of a written Revolving Borrowing Request,
appropriately completed and signed by a Financial Officer of the Borrower.  Each such telephonic and written Revolving
Borrowing Request shall specify the following information in compliance with Section 2.02:

 

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

 

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

 

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

 

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

 

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

 

(vi)          the location and number of the Borrower’s account to which
Loans are to be disbursed, which shall comply with the requirements of Section 2.04.

 

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

 

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

 

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

 

20

 

SECTION 2.04. 
Funding of Borrowings.  (a) 
Each Lender shall make each Loan to be made by it hereunder on the proposed
date thereof in immediately available funds by 12:00 noon, New York City time,
at the Administrative Agent’s Office. 
Upon satisfaction of the applicable conditions set forth in Section 4.02,
the Administrative Agent will make such Loans available to the Borrower in like
funds as received by the Administrative Agent either by (i) crediting the
account of the Borrower on the books of the Administrative Agent with the
amount of such funds or (ii) wire transfer of such funds, in each case in
accordance with instructions provided to (and reasonably acceptable to) the
Administrative Agent by the Borrower in the applicable Revolving Borrowing Request.

 

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

 

(c)           Unless the Administrative Agent shall have received notice
from a Lender prior to the proposed date of any Borrowing that such Lender will
not make available to the Administrative Agent such Lender’s share of such
Borrowing, the Administrative Agent may assume that such Lender has made such
share available on such date in accordance with paragraph (a) of this Section and
may, in its sole discretion, in reliance upon such assumption, make available
to the Borrower a corresponding amount. 
In such event, if a Lender has not in fact made its share of the
applicable Borrowing available to the Administrative Agent, then the applicable
Lender and the Borrower severally agree to pay to the Administrative Agent
forthwith on demand such corresponding amount with interest thereon, for each
day from and including the date such amount is made available to the Borrower
to but excluding the date of payment to the Administrative Agent, at (i) in
the case of such Lender, the greater of the Federal Funds Effective Rate and a
rate determined by the Administrative Agent in accordance with banking industry
rules on interbank compensation, plus any administrative, processing or
similar fees customarily charged by the Administrative Agent in connection with
the foregoing, or (ii) in the case of the Borrower, the interest rate
applicable to ABR Loans.  If the Borrower
and such Lender shall pay such interest to the Administrative Agent for the
same or an overlapping period, the Administrative Agent shall promptly remit to
the Borrower the amount of such interest paid by the Borrower for such
period.  If such Lender pays such amount
to the Administrative Agent, then such amount shall constitute such Lender’s
Loan included in such Borrowing.  A
notice of the Administrative Agent to any Lender or the Borrower with respect
to any amount owing under this subsection (c) shall be conclusive,
absent manifest error.

 

(d)           If any Lender makes available to the Administrative Agent
funds for any Loan to be made by such Lender as provided in the foregoing
provisions of this Section 2.04, and such funds are not made
available to the Borrower by the Administrative Agent because the conditions to
the applicable Borrowing set forth in Article IV are not satisfied
or waived in accordance with the terms hereof, the Administrative Agent shall
return such funds (in like funds as received from such Lender) to such Lender,
without interest.

 

21

 

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

 

SECTION 2.05. 
Termination and Reduction of Commitments.  (a)  Unless previously terminated, the
Commitments shall terminate on the Revolving Credit Termination Date.

 

(b)           The Borrower may, upon notice to the Administrative Agent
pursuant to Section 2.05(c), at any time terminate, or from time to
time reduce, the Commitments; provided that (i) each reduction of the
Commitments shall be in an amount that is an integral multiple of $1,000,000
and not less than $10,000,000, and (ii) the Borrower shall not terminate
or reduce the Commitments if, after giving effect to any concurrent prepayment
of the Loans in accordance with Section 2.07, the aggregate
Revolving Credit Exposures of all Lenders would exceed the aggregate
Commitments of all Lenders then in effect.

 

(c)           The Borrower shall notify the Administrative Agent of any
election to terminate or reduce the Commitments under paragraph (b) of
this Section at least three (3) Business Days prior to the effective
date of such termination or reduction, specifying such election and the
effective date thereof.  Promptly
following receipt of any notice, the Administrative Agent shall advise the
Lenders of the contents thereof.  Each
notice delivered by the Borrower pursuant to this Section shall be
irrevocable; provided that a notice of termination of the Commitments
delivered by the Borrower may state that such notice is conditioned upon the
effectiveness of other credit facilities, in which case such notice may be
revoked by the Borrower (by notice to the Administrative Agent on or prior to
the specified effective date) if such condition is not satisfied.  Any termination or reduction of the
Commitments shall be permanent.  Each
reduction of the Commitments shall be made ratably among the Lenders in
accordance with their Applicable Percentage. 
All fees accrued until the effective date of any termination of the
Commitments shall be paid on the effective date of such termination.

 

SECTION 2.06. 
Repayment of Loans; Evidence of Debt.  (a)  The Borrower hereby unconditionally
promises to pay to the Administrative Agent for the account of each Lender the
then unpaid principal amount of each Loan on the Revolving Credit Termination
Date (or such earlier date on which the Loans become due and payable pursuant
to Article VII).

 

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

 

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

 

22

 

by the Administrative Agent hereunder for the
account of the Lenders and each Lender’s share thereof.

 

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

 

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

 

SECTION 2.07.  Prepayment of Loans.  (a)  The Borrower shall have the right
at any time and from time to time to prepay any Loans in whole or in part,
subject to prior notice in accordance with paragraph (b) of this Section.

 

(b)           The Borrower shall notify the Administrative Agent by
telephone (confirmed by telecopy) of any prepayment hereunder (i) in the
case of prepayment of a Eurodollar Loan, not later than 11:00 a.m., New
York City time, three (3) Business Days before the date of prepayment, or (ii) in
the case of prepayment of an ABR Loan, not later than 11:00 a.m., New York
City time, one (1) Business Day before the date of prepayment.  Each such notice shall be irrevocable and
shall specify the prepayment date and the principal amount of the Loans to be
prepaid and the Type(s) of Loans to be prepaid and, if Eurodollar Loans
are to be prepaid, the Interest Period(s) of such Loans; provided
that, if a notice of prepayment is given in connection with a conditional
notice of termination of the Commitments as contemplated by Section 2.05,
then such notice of prepayment may be revoked if such notice of termination is
revoked in accordance with Section 2.05.  Promptly following receipt of any such
notice, the Administrative Agent shall advise the Lenders of the contents
thereof and of the amount of such Lender’s ratable share of such
prepayment.  Each partial prepayment of
any Loans shall be in an amount that would be permitted in the case of an
advance of a Borrowing of the same Type as provided in Section 2.02.  Any prepayment of a Eurodollar Loan shall be
accompanied by all accrued interest on the amount prepaid as required pursuant
to Section 2.09(d), together with any additional amounts required
pursuant to Section 2.12. 
Each such prepayment shall be applied to the Loans of the Lenders
ratably in accordance with their respective Revolving Credit Exposure.

 

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

 

23

 

SECTION 2.08. 
Fees.  (a)  The
Borrower agrees to pay to the Administrative Agent for the account of each
Lender, a facility fee which shall accrue at the Applicable Rate on the daily
amount of the Commitment of such Lender (whether used or unused), during the
Availability Period, including at any time during which one or more of the
conditions in Section 4.02 is not met; provided, however,
that (i) if such Lender continues to have any outstanding Loans after the
Availability Period, then such facility fee shall continue to accrue on the
daily amount of the outstanding Loans of such Lender from and including the
date on which the aggregate Commitments of all Lenders are terminated to, but
excluding, the date on which such Lender ceases to have any outstanding Loans
and (ii) if such Lender is a Defaulting Lender at any time, such facility
fee shall cease to accrue on, and the Borrower shall not be required to pay a
facility fee with respect to, the daily unused amount of the Commitment of such
Lender during such period of time such Lender is a Defaulting Lender.  Accrued facility fees shall be payable in
arrears on the last Business Day of March, June, September and December of
each year and on the date on which the Commitments terminate, commencing on the
first such date to occur after the Closing Date; provided that any
facility fees accruing after the date on which the aggregate Commitments
terminate shall be payable on demand. 
The facility fee owing with respect to each Lender shall be calculated
quarterly in arrears, and if there is any change in the Applicable Rate during
any quarter, the actual daily amount shall be computed and multiplied by the
Applicable Rate separately for each period during such quarter that such
Applicable Rate was in effect.  All facility
fees shall be computed on the basis of a year of 360 days and shall be payable
for the actual number of days elapsed (including the first day but excluding
the last day).

 

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

 

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

 

SECTION 2.09. 
Interest.  (a) 
Subject to the provisions of subsection (c) below, the ABR Loans
shall bear interest at a rate per annum equal to the Alternate Base Rate plus
the Applicable Rate.

 

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

 

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

 

(ii)           If any amount (other than principal of any Loan) payable
by the Borrower under any Loan Document is not paid when due (without regard to
any 

 

24

 

applicable grace periods), whether at stated
maturity, by acceleration or otherwise, then upon the request of the Required
Lenders, such amount shall thereafter bear interest at a fluctuating interest
rate per annum at all times equal to the Default Rate to the fullest extent
permitted by applicable law.

 

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

 

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

 

(e)           All computations of interest for ABR Loans shall be
computed on the basis of a year of 365 days (or 366 days in a leap year), and
shall be payable for the actual number of days elapsed (including the first day
but excluding the last day).  All other
computations of interest shall be made on the basis of a 360-day year and
actual days elapsed (which results in more interest being paid than if computed
on the basis of a 365-day year). 
Interest shall accrue on each Loan for the day on which the Loan is
made, and shall not accrue on a Loan, or any portion thereof, for the day which
the Loan or such portion is paid; provided that any Loan that is repaid
on the same day on which it is made shall, subject to Section 2.14(a),
bear interest for one day.  The
applicable Alternate Base Rate, Adjusted LIBO Rate or LIBO Rate shall be
determined by the Administrative Agent, and such determination shall be
conclusive absent manifest error.

 

SECTION 2.10. 
Alternate Rate of Interest. 
(a)  If, in connection with any request for a Eurodollar Loan or a
conversion to or continuation thereof, the Required Lenders determine that for
any reason (which determination shall be conclusive absent manifest error) that
(a) dollar deposits are not being offered to banks in the London interbank
eurodollar market for the applicable amount and Interest Period of such
Eurodollar Loan, (b) adequate and reasonable means do not exist for
ascertaining the Adjusted LIBO Rate or the LIBO Rate, as applicable, for any
requested Interest Period with respect to a proposed Eurodollar Loan; or (c) the
Adjusted LIBO Rate or the LIBO Rate, as applicable, for any requested Interest
Period with respect to a proposed Eurodollar Loan will not adequately and
fairly reflect the cost to such Lenders of funding such Loan, then the
Administrative Agent shall give notice thereof to the Borrower and each Lender
by telephone or telecopy as promptly as practicable thereafter.  Until the Administrative Agent (upon the
instruction of the Required Lenders) revokes such notice, (i) any 

 

25

 

Revolving
Borrowing Request that requests the conversion of any Loan to, or continuation
of any Loan as, a Eurodollar Loan shall be ineffective, and (ii) if any
Revolving Borrowing Request requests a Borrowing of Eurodollar Loans, such
Borrowing shall be made as an ABR Loan.

 

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

 

SECTION 2.11. 
Increased Costs.  (a) 
If any Change in Law shall:

 

(i)        impose, modify
or deem applicable any reserve, special deposit, compulsory loan, insurance
charge or similar requirement against assets of, deposits with or for the
account of, or credit extended by, any Lender (except any such reserve
requirement reflected in the Adjusted LIBO Rate); or

 

(ii)       subject any
Lender to any tax of any kind whatsoever with respect to this Agreement or any
Eurodollar Loan made by it, or change the basis of taxation of payments to such
Lender in respect thereof (except for Indemnified Taxes or Other Taxes covered
by Section 2.13 and the imposition of, or any change in the rate
of, any Excluded Tax payable by such Lender); or

 

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

 

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

 

(b)           If any Lender determines that any Change in Law regarding
capital requirements has or would have the effect of reducing the rate of
return on such Lender’s capital or on the capital of such Lender’s holding
company, if any, as a consequence of this Agreement, 

 

26

 

the Commitments of such Lender or the Loans made
hereunder, to a level below that which such Lender or such Lender’s holding
company could have achieved but for such Change in Law (taking into
consideration such Lender’s policies and the policies of such Lender’s holding
company with respect to capital adequacy), then from time to time the Borrower
will pay to such Lender such additional amount or amounts as will compensate
such Lender or such Lender’s holding company for any such reduction suffered.

 

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

 

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

 

(e)           Subject to Section 2.11(d), all of the
Borrower’s obligations under this Section 2.11 shall survive
termination of the Commitments, repayment of all Loans and other obligations
hereunder, and resignation of the Administrative Agent.

 

SECTION 2.12. 
Break Funding Payments.  In
the event of (a) the payment of any principal of any Eurodollar Loan other
than on the last day of an Interest Period applicable thereto (whether
voluntary, mandatory, by reason of acceleration, or otherwise), (b) the
conversion of any Eurodollar Loan other than on the last day of the Interest
Period applicable thereto (whether voluntary, mandatory, automatic, by reason
of acceleration, or otherwise), (c) the failure to borrow, convert,
continue or prepay any Loan on the date specified in any notice delivered
pursuant hereto (regardless of whether such notice is permitted to be revocable
under Section 2.07(b) and is revoked in accordance herewith),
or (d) the assignment of any Eurodollar Loan other than on the last day of
the Interest Period applicable thereto as a result of a request by the Borrower
pursuant to Section 2.15, then, in any such event, the Borrower
shall compensate each Lender for the loss, cost and expense attributable to
such event.  The Borrower shall also pay
any customary administrative fees charged by such Lender in connection with the
foregoing.  In the case of a Eurodollar
Loan, the loss to any Lender attributable to any such event shall be deemed to
include an amount determined by such Lender to be equal to the excess, if any,
of (i) the amount of interest that such Lender would pay for a deposit
equal to the principal amount of such Loan for the period from the date of such
payment, conversion, failure or assignment to the last day of the then current
Interest Period for such Loan (or, in the case of a failure to borrow, convert
or continue, the duration of the Interest Period that would have resulted from
such 

 

27

 

borrowing,
conversion or continuation) if the interest rate payable on such deposit were
equal to the Adjusted LIBO Rate (in the case of a Eurodollar Loan) for such
Interest Period, over (ii) the amount of interest that such Lender would
earn on such principal amount for such period if such Lender were to invest
such principal amount for such period at the interest rate that would be bid by
such Lender (or an affiliate of such Lender) for dollar deposits from other
banks in the eurodollar market at the commencement of such period.  A certificate of any Lender setting forth any
amount or amounts that such Lender is entitled to receive pursuant to this Section shall
be delivered to the Borrower and shall be conclusive absent manifest
error.  The Borrower shall pay such
Lender the amount shown as due on any such certificate within ten (10) days
after receipt thereof.  All of the
Borrower’s obligations under this Section 2.12 shall survive
termination of the Commitments, repayment of all Loans and other obligations
hereunder, and resignation of the Administrative Agent.

 

SECTION 2.13. 
Taxes.  (a)  Any and
all payments by or an account of any obligation of the Borrower hereunder shall
be made free and clear of and without deduction for any Indemnified Taxes or
Other Taxes; provided that if the Borrower shall be required to deduct
any Indemnified Taxes or Other Taxes from such payments, then (i) the sum
payable shall be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section) the Administrative Agent or Lender (as the case may be) receives
an amount equal to the sum it would have received had no such deductions been
made, (ii) the Borrower shall make such deductions, and (iii) the
Borrower shall pay the full amount deducted to the relevant Governmental
Authority in accordance with applicable law.

 

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

 

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

 

(ii)       Without limiting the provisions of subsection (a), (b) or
(c) above, each Lender shall, and does hereby, indemnify the
Borrower and the Administrative Agent, and shall make payment in respect
thereof within ten (10) days after demand therefor, against any and all
Taxes and any and all related losses, claims, liabilities, 

 

28

 

penalties, interest and
expenses (including the fees, charges and disbursements of any counsel for the
Borrower or the Administrative Agent) incurred by or asserted against the
Borrower or the Administrative Agent by any Governmental Authority as a result
of the failure by such Lender to deliver, or as a result of the inaccuracy,
inadequacy or deficiency of, any documentation required to be delivered by such
Lender to the Borrower or the Administrative Agent pursuant to subsection
(e).  Each Lender hereby authorizes
the Administrative Agent to set off and apply any and all amounts at any time
owing to such Lender under this Agreement or any other Loan Document against
any amount due to the Administrative Agent under this clause (ii).  The agreements in this clause (ii) shall
survive the resignation and/or replacement of the Administrative Agent, any
assignment of rights by, or the replacement of, a Lender.

 

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

 

(e)           (i)  Each Lender shall deliver to the Borrower and to
the Administrative Agent, at the time or times prescribed by applicable laws or
when reasonably requested by the Borrower or the Administrative Agent, such
properly completed and executed documentation prescribed by applicable laws or
by the taxing authorities of any jurisdiction and such other reasonably
requested information as will permit the Borrower or the Administrative Agent,
as the case may be, to determine (A) whether or not payments made
hereunder or under any other Loan Document are subject to Taxes, (B) if
applicable, the required rate of withholding or deduction, and (C) such
Lender’s entitlement to any available exemption from, or reduction of,
applicable Taxes in respect of all payments to be made to such Lender by the
Borrower pursuant to this Agreement or otherwise to establish such Lender’s
status for withholding tax purposes in the applicable jurisdiction.

 

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

 

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

 

(B)           each Foreign Lender that is entitled
under the Code or any applicable treaty to an exemption from or reduction of
withholding 

 

29

 

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

 

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

 

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

 

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

 

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

 

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

 

(iii)          Each Lender shall promptly (A) notify the Borrower and
the Administrative Agent of any change in circumstances which would modify or
render invalid any claimed exemption or reduction, and (B) take such steps
as shall not be

 

30

 

materially disadvantageous
to it, in the reasonable judgment of such Lender, and as may be reasonably
necessary (including the re-designation of its lending office) to avoid any
requirement of applicable laws of any jurisdiction that the Borrower or the Administrative
Agent make any withholding or deduction for taxes from amounts payable to such
Lender.

 

(iv)          Each Lender shall deliver to the Administrative Agent and
the Borrower such other tax forms or other documents as shall be prescribed by
applicable law to demonstrate, where applicable, that payments under this
Agreement and the other Loan Documents to such Lender or the Administrative
Agent are exempt from application of the United States federal withholding
taxes imposed pursuant to Sections 1471 through 1474 of the Code (including any
successor provisions thereto) and any regulations promulgated thereunder or
official interpretations thereof.

 

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

 

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

 

(h)           If the Administrative Agent or any Lender determines, in
its sole discretion, that it has received a refund of any Indemnified Taxes or
Other Taxes as to which it has been indemnified by the Borrower or with respect
to which the Borrower has paid additional amounts pursuant to this Section, it
shall pay to the Borrower an amount equal to such refund (but only to the extent
of indemnity payments made, or additional amounts paid, by the Borrower under
this Section with respect to the Taxes or Other Taxes giving rise to such
refund), net of all out-of-pocket expenses incurred by the Administrative Agent
or such Lender, as the case may be, and without interest (other than any
interest paid by the relevant Governmental Authority with respect to such
refund), provided that the Borrower, upon the request of the
Administrative Agent or such Lender, agrees to repay the amount paid over to
the Borrower (plus any penalties, interest or other charges imposed by the
relevant Governmental Authority) to the Administrative Agent or such Lender in
the event the Administrative Agent or such Lender is required to repay such
refund to such Governmental Authority. 
This subsection shall not be construed to require the Administrative
Agent or any Lender to make available its tax returns (or any other information
relating to its taxes that it deems confidential) to the Borrower or any other
Person.

 

SECTION 2.14. 
Payments Generally; Pro Rata Treatment; Sharing of Set-offs.  (a)  All payments to be made by the
Borrower shall be made without condition or deduction for any counterclaim,
defense, recoupment or setoff.  The
Borrower shall make each payment required to be made by it hereunder (whether
of principal, interest, fees, or under Sections 2.11, 2.12 or 2.13,
or otherwise) to the Administrative Agent, for the account of the respective
Lenders to which such payment is owed, at the Administrative Agent’s Office
prior to 12:00 noon, New 

 

31

 

York
City time, on the date when due, in immediately available funds.  Any amounts received after such time on any
date shall be deemed to have been received on the next succeeding Business Day
and any applicable interest or fee shall continue to accrue.  The Administrative Agent will promptly
distribute to each Lender its Applicable Percentage (or other applicable share
as provided herein) of such payment in like funds as received by wire transfer
to such Lender (or as otherwise directed by such Lender).  If any payment hereunder shall be due on a
day that is not a Business Day, the date for payment shall be extended to the
next succeeding Business Day, and, in the case of any payment accruing
interest, interest thereon shall be payable for the period of such
extension.  All payments hereunder shall
be made in dollars.

 

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

 

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

 

(d)           Unless the Administrative Agent shall have received notice
from the Borrower prior to the date on which any payment is due to the
Administrative Agent for the account of the Lenders hereunder that the Borrower
will not make such payment, the Administrative Agent may assume that the
Borrower has made such payment on such date in accordance herewith and may, in
reliance upon such assumption, distribute to the Lenders the amount due.  In such event, if the Borrower has not in
fact made such payment, then each of the Lenders severally agrees to repay to
the Administrative Agent forthwith on demand the amount so distributed to such
Lender with interest thereon, for each day from and including the date such 

 

32

 

amount is distributed to it to but excluding the
date of payment to the Administrative Agent, at the greater of the Federal
Funds Effective Rate and a rate determined by the Administrative Agent in
accordance with banking industry rules on interbank compensation.  A notice of the Administrative Agent to any
Lender with respect to any amount owing under this subsection (d) shall
be conclusive, absent manifest error.

 

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

 

(f)            If any Lender shall fail to make any payment required to
be made by it pursuant to Sections 2.04(c), 2.14(d) or 9.03(c),
then the Administrative Agent may, in its discretion (notwithstanding any
contrary provision hereof), apply any amounts thereafter received by the
Administrative Agent for the account of such Lender to satisfy such Lender’s
obligations under such Sections until all such unsatisfied obligations are
fully paid.

 

SECTION 2.15. 
Mitigation Obligations; Replacement of Lenders.  (a)  If any Lender requests compensation
under Section 2.11, or if the Borrower is required to pay any
additional amount to any Lender or any Governmental Authority for the account
of any Lender pursuant to Section 2.13, or if the Borrower is
required to pay any additional amount as a result of a Lender, pursuant to Section 2.02(b),
making its Loans through a particular domestic or foreign branch of such Lender
or through an Affiliate of such Lender, then such Lender shall use reasonable
efforts to designate a different lending office for funding or booking its
Loans hereunder or to assign its rights and obligations hereunder to another of
its offices, branches or Affiliates, if, in the judgment of such Lender, such
designation or assignment (i) would eliminate or reduce amounts payable
pursuant to Section 2.11 or 2.13 or as a result of the
exercise of its discretion under Section 2.02(b), as the case may
be, in the future, and (ii) would not subject such Lender to any
unreimbursed cost or expense and would not otherwise be disadvantageous to such
Lender.  The Borrower hereby agrees to
pay all reasonable costs and expenses incurred by any Lender in connection with
any such designation or assignment.

 

(b)           If any Lender requests compensation under Section 2.11,
or if the Borrower is required to pay any additional amount to any Lender or
any Governmental Authority for the account of any Lender pursuant to Section 2.13,
or if any Lender is a Defaulting Lender, then the Borrower may, at its sole
expense and effort, upon notice to such Lender and the Administrative Agent,
require such Lender to assign and delegate, without recourse (in accordance
with and subject to the restrictions contained in, and consents required by, Section 9.04),
all of its interests, rights and obligations under this Agreement and the
related Loan Documents to an assignee that shall assume such obligations (which
assignee may be another Lender, if a Lender accepts such assignment), provided
that: (i) the Borrower shall have paid to the Administrative Agent the
assignment fee specified in Section 9.04, (ii) such Lender
shall have received payment of an amount equal to the outstanding principal of
its Loans, accrued 

 

33

 

interest thereon, accrued fees and all other amounts
payable to it hereunder and under the other Loan Documents from the assignee
(to the extent of such outstanding principal and accrued interest and fees) or
the Borrower (in the case of all other amounts), (iii) in the case of any
such assignment resulting from a claim for compensation under Section 2.11
or payments required to be made pursuant to Section 2.13, such
assignment will result in a reduction in such compensation or payments, and (iv) such
assignment does not conflict with any applicable law.  A Lender shall not be required to make any such
assignment and delegation if, prior thereto, as a result of a waiver by such
Lender or otherwise, the circumstances entitling the Borrower to require such
assignment and delegation cease to apply.

 

SECTION 2.16. 
Increase in Commitments.

 

(a)           Provided no Default has occurred and is continuing, upon
notice to the Administrative Agent (which shall promptly notify the Lenders),
the Borrower may from time to time request an increase in the aggregate amount
of the Commitments by an amount (for all such requests) not exceeding
$75,000,000 in the aggregate; provided that any such request for an
increase shall be in a minimum amount of $10,000,000.  Any such increase in the aggregate
Commitments may be provided by any Lender willing to participate in any such increase
(each such Lender, a “Participating Lender”), or, subject to the
approval of the Administrative Agent, Eligible Assignees designated by the
Borrower that are willing to participate in such increase (each, an “Increasing
Lender”) and to become Lenders pursuant to a “Joinder Agreement”, in form
and substance reasonably satisfactory to the Administrative Agent, pursuant to
which such Increasing Lender shall become a party to this Agreement.  The Administrative Agent and the Borrower
shall determine (A) the final allocation of such increase among the
Participating Lenders and Increasing Lenders and Schedule 2.01 attached
hereto shall be automatically updated to reflect the same and (B) the
effective date (the “Increase Effective Date”) of any such increase.  Nothing contained herein shall constitute, or
otherwise be deemed to be, a commitment on the part of any Lender to increase
its Commitment hereunder.

 

(b)           As a condition precedent to such increase, the Borrower
shall deliver to the Administrative Agent a certificate of the Borrower dated
as of the Increase Effective Date (in sufficient copies for each Lender) signed
by a duly authorized officer of the Borrower (i) certifying and attaching
the resolutions adopted by the Borrower approving or consenting to such
increase (which may be covered in resolutions authorizing Borrowings on and
after the Closing Date), and (ii) certifying that, before and after giving
effect to such increase, (A) the representations and warranties contained
in Article III and the other Loan Documents are true and correct on
and as of the Increase Effective Date, except to the extent that such
representations and warranties specifically refer to an earlier date, in which
case they are true and correct as of such earlier date, and except that for
purposes of this Section 2.16, the representations and warranties
contained in Section 3.04(a) shall be deemed to refer to the
most recent financial statements furnished in connection with the statements
delivered pursuant to clauses (a) and (b) of Section 5.01,
and (B) no Default has occurred and is continuing.  The Borrower shall prepay any Loans
outstanding on the Increase Effective Date (and pay any additional amounts
required pursuant to Section 2.12) to the extent necessary to keep
the 

 

34

 

outstanding Loans ratable with any revised
Applicable Percentages arising from any nonratable increase in the Commitments
under this Section.

 

(c)           This Section 2.16 shall supersede any
provisions in Section 2.14(c) or Section 9.02 to
the contrary.

 

SECTION 2.17. 
Defaulting Lenders. 
Notwithstanding anything to the contrary contained in this Agreement, if
any Lender becomes a Defaulting Lender, then, until such time as such Lender is
no longer a Defaulting Lender, to the extent permitted by applicable law:

 

(a)           Waivers and Amendments.  Such Defaulting Lender’s right to approve or
disapprove any amendment, waiver or consent with respect to this Agreement
shall be restricted as set forth in Section 9.02.

 

(b)           Reallocation of Loan Payments. Any payment or
prepayment of principal, interest, fees or other amounts received by the
Administrative Agent for the account of that Defaulting Lender (whether
voluntary or mandatory, at maturity, pursuant to Article VII or
otherwise, and including amounts made available to the Administrative Agent by
that Defaulting Lender pursuant to Section 9.08), shall be applied
at such time or times as may be determined by the Administrative Agent as
follows: first, to the payment of any amounts owing by that Defaulting
Lender to the Administrative Agent hereunder; second, as the Borrower
may request (so long as no Default or Event of Default exists), to the funding
of any Loan in respect of which that Defaulting Lender has failed to fund its
portion thereof as required by this Agreement, as determined by the
Administrative Agent; third, if so determined by the Administrative
Agent and the Borrower, to be held in a non-interest bearing deposit account
and released in order to satisfy obligations of that Defaulting Lender to fund
Loans under this Agreement; fourth, to the payment of any amounts owing
to the Lenders as a result of any judgment of a court of competent jurisdiction
obtained by any Lender against that Defaulting Lender as a result of that
Defaulting Lender’s breach of its obligations under this Agreement; fifth,
to the payment of any amounts owing to the Borrower as a result of any judgment
of a court of competent jurisdiction obtained by the Borrower against that
Defaulting Lender as a result of that Defaulting Lender’s breach of its
obligations under this Agreement; and sixth, to that Defaulting Lender
or as otherwise directed by a court of competent jurisdiction; provided
that if (x) such payment is a payment of the principal amount of any Loans
in respect of which that Defaulting Lender has not fully funded its appropriate
share and (y) such Loans were made at a time when the conditions set forth
in Section 4.02 were satisfied or waived, such payment shall be
applied solely to pay the Loans of all non-Defaulting Lenders on a pro rata
basis prior to being applied to the payment of any Loans of that Defaulting
Lender.  Any payments, prepayments or
other amounts paid or payable to a Defaulting Lender that are applied to pay
amounts owed by a Defaulting Lender pursuant to this Section 2.17(b) shall
be deemed paid to and redirected by that Defaulting Lender, and each Lender
hereby irrevocably consents thereto.

 

(c)           Fees. Such Defaulting Lender’s right to any
facility fee shall be limited as provided in Section 2.08.

 

35

 

(d)           Defaulting Lender Cure. A Lender that has become a
Defaulting Lender because of an event referenced in the definition of
Defaulting Lender may cure such status and shall no longer constitute a
Defaulting Lender as a result of such event when (i) such Defaulting
Lender shall have fully funded or paid, as applicable, all Loans or other
amounts required to be funded or paid by it hereunder as to which it is
delinquent (together, in each case, with such interest thereon as shall be
required to any Person as otherwise provided in this Agreement), (ii) the
Administrative Agent and the Borrower shall have received a certification by
such Defaulting Lender of its ability and intent to comply with the provisions
of this Agreement going forward, and (iii) each of (x) the
Administrative Agent, (y) any other Lender as to which a delinquent
obligation was owed, and (z) in the case of the failure to fund any Loan,
the Borrower, shall have determined (and notified the Administrative Agent)
that they are satisfied, in their sole discretion, that such Defaulting Lender
intends to continue to perform its obligations as a Lender hereunder and has
all approvals required to enable it, to continue to perform its obligations as
a Lender hereunder.  No reference in this
subsection to an event being “cured” shall by itself preclude any claim by any
Person against any Lender that becomes a Defaulting Lender for such direct
damages as may otherwise be available to such Person arising from any failure
to fund or pay any amount when due hereunder or from any other event that gave
rise to such Lender’s status as a Defaulting Lender.

 

This
Section 2.17 shall supersede any provisions in Section 2.14(c) or
Section 9.02 to the contrary.

 

ARTICLE III

 

Representations and
Warranties

 

The
Borrower represents and warrants to the Lenders that:

 

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

 

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

 

36

 

subject
to general principles of equity, regardless of whether considered in a
proceeding in equity or at law.

 

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

 

SECTION 3.04. 
Financial Condition; No Material Adverse Effect.  (a)  The Borrower has heretofore
furnished to the Lenders its consolidated balance sheet and statements of
income, stockholders equity and cash flows (i) as of and for the fiscal
years ended 2008 and 2009, reported on by KPMG LLP, an independent registered
public accounting firm, and (ii) as of and for the fiscal quarters and the
portion of the fiscal year ended March 31, 2010 and June 30, 2010,
certified by its chief financial officer. 
Such financial statements present fairly, in all material respects, the
financial position and results of operations and cash flows of the Borrower and
its consolidated Subsidiaries as of such dates and for such periods in
accordance with GAAP, subject to year-end audit adjustments and the absence of
footnotes in the case of the statements referred to in clause (ii) above.  The Borrower and its Subsidiaries do not have
any Guarantees, contingent liabilities, or any long-term leases or unusual
forward or long-term commitments, including any interest rate or foreign
currency swap or exchange transaction or other obligation in respect of
derivatives, in each case, that are required by GAAP to be reflected or
disclosed in such financial statements, that are not reflected or disclosed in
the most recent financial statements referred to in this paragraph, except as
disclosed on Schedule 3.04.

 

(b)           Since December 31, 2009, there has been no event,
development or circumstance that has had or could reasonably be expected,
either individually or in the aggregate, to have a Material Adverse Effect
(other than the Disclosed Matters).

 

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

 

(b)           Each of the Borrower and its Subsidiaries owns, or is
licensed to use, all trademarks, tradenames, copyrights, patents and other
intellectual property material to its business, and, to the actual knowledge of
the Senior Financial Officers after due internal inquiry, the use thereof by
the Borrower and its Subsidiaries does not infringe in any material respect
upon the rights of any other Person.  To
the actual knowledge of the Senior Financial Officers, after due internal
inquiry, there is no material violation by any Person of any right of the
Borrower or any of its Subsidiaries with respect to any patent, copyright,
proprietary software, service mark, trademark, trade name or other right owned
or used by the Borrower or any of its 

 

37

 

Subsidiaries that is material to the business of the
Borrower and its Subsidiaries taken as a whole.

 

SECTION 3.06. 
Litigation and Environmental Matters.  (a)  There are no actions, suits or
proceedings by or before any arbitrator or Governmental Authority pending
against or, to the actual knowledge of the Senior Financial Officers,
threatened against or affecting the Borrower or any of its Subsidiaries (i) as
to which there is a reasonable possibility of an adverse determination and
that, if adversely determined, could reasonably be expected, individually or in
the aggregate, to result in a Material Adverse Effect (other than the Disclosed
Matters), or (ii) that involve this Agreement, the other Loan Documents or
the Transactions.

 

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

 

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

 

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

 

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

 

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

 

38

 

required, is, and at all times will be, a member in
good standing of the Financial Industry Regulatory Authority.

 

SECTION 3.09. 
Taxes.  Each of the
Borrower and its Subsidiaries has timely filed or caused to be filed all Tax
returns and reports required to have been filed and has paid or caused to be
paid all Taxes required to have been paid by it, except (a) Taxes that are
being contested in good faith by appropriate proceedings and for which the
Borrower or such Subsidiary, as applicable, has set aside on its books adequate
reserves, or (b) to the extent that the failure to do so could not
reasonably be expected to result in a Material Adverse Effect.  The charges, accruals and reserves on the
books of the Borrower and its Subsidiaries in respect of Federal, state or
other taxes for all fiscal periods are adequate.  The Federal income tax liabilities of the
Borrower and its Subsidiaries have been finally determined (whether by reason
of completed audits or the statute of limitations having run) for all fiscal
years up to and including the fiscal year ended 2004 and paid for all fiscal
years up to and including the fiscal year ended 2009.

 

SECTION 3.10. 
ERISA Compliance.

 

(a)           To the actual knowledge of the Senior Financial Officers,
nothing has occurred that would cause any Pension Plan to fail to be in
compliance with the applicable provisions of ERISA and the Code and could
reasonably be expected to result in a Material Adverse Effect.

 

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

 

(c)           (i) No ERISA Event has occurred, and neither the
Borrower nor any ERISA Affiliate is aware of any fact, event or circumstance
that could reasonably be expected to constitute or result in an ERISA Event
with respect to any Pension Plan; (ii) the Borrower and each ERISA
Affiliate has met all applicable requirements under the Pension Funding Rules in
respect of each Pension Plan, and no waiver of the minimum funding standards
under the Pension Funding Rules has been applied for or obtained; (iii) as
of the most recent valuation date for any Pension Plan, the funding target
attainment percentage (as defined in Section 430(d)(2) of the Code)
is 60% or higher and neither the Borrower nor any ERISA Affiliate knows of any
facts or circumstances that could reasonably be expected to cause the funding
target attainment percentage for any such plan to drop below 60% as of the most
recent valuation date; (iv) neither the Borrower nor any ERISA Affiliate
has incurred any liability to the PBGC other than for the payment of premiums,
and there are no premium payments which have become due that are unpaid; (v) neither
the Borrower nor any ERISA Affiliate has engaged in a transaction that could be
subject to Section 4069 or Section 4212(c) of ERISA; and (vi) no
Pension Plan has been terminated by the plan administrator thereof nor by the
PBGC, and no event or circumstance has 

 

39

 

occurred or exists that could reasonably be expected
to cause the PBGC to institute proceedings under Title IV of ERISA to terminate
any Pension Plan.

 

(d)           Neither the Borrower nor any ERISA Affiliate maintains or
contributes to, or has any unsatisfied obligation to contribute to, or
liability under, any active or terminated Pension Plan other than (A) on
the Closing Date, those listed on Schedule 3.10(d) hereto and (B) thereafter,
Pension Plans not otherwise prohibited by this Agreement.

 

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

 

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

 

SECTION 3.13. 
Subsidiaries.  Except as
disclosed to the Administrative Agent by the Borrower in writing from time to
time after the Closing Date, Part (a) of Schedule 3.13 sets
forth the name and jurisdiction of incorporation of each Subsidiary and, as to
each such Subsidiary, the percentage of each class of Capital Stock owned by
the Borrower.  There are no outstanding
subscriptions, options, warrants, calls, rights or other agreements or
commitments (other than stock options or restricted stock granted to employees
or directors and directors’ qualifying shares) of any nature relating to any Capital
Stock of the Borrower or any Subsidiary. 
The Borrower has no equity investments in any other corporation or
entity other than those specifically disclosed in Part (b) of Schedule
3.13.  All of the outstanding Capital
Stock of the Subsidiaries owned by the Borrower have been validly issued, are
fully paid and nonassessable and are owned free and clear of all Liens.  All of the outstanding Capital Stock in the
Borrower has been validly issued and are fully paid and nonassessable.  No Subsidiary is a party to, or otherwise
subject to any Requirement of Law (other than this Agreement, the agreements
listed on Schedule 6.08 as of the date of this Agreement and customary
limitations imposed by regulation, corporate law or similar statutes)
restricting the ability of such Subsidiary to pay dividends out of profits or
make any other similar distributions of profits to the Borrower or any of its
Subsidiaries that owns outstanding shares of capital stock or similar equity
interests of such Subsidiary.

 

40

 

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

 

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

 

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

 

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

 

SECTION 3.18. 
Foreign Assets Control Regulations, Etc.

 

(a)                                  The Borrower
and each Subsidiary of the Borrower is in compliance in all material respects with
all U.S. economic sanctions laws, Executive Orders and implementing regulations
as promulgated by the U.S. Treasury Department’s Office of Foreign Assets
Control (“OFAC”), and all applicable anti-money laundering and
counter-terrorism financing provisions of the Bank Secrecy Act and all
regulations issued pursuant to it.  None
of the Borrower or any Subsidiary of the Borrower (i) is a Person
designated by the U.S. government on the list of the Specially Designated
Nationals and Blocked Persons (the “SDN List”) with which a U.S. Person
cannot deal with or otherwise engage in business transactions, (ii) is a
Person who is otherwise the target of U.S. economic sanctions laws such that a
U.S. Person cannot deal or otherwise engage in business transactions with such
Person or (iii) is controlled by (including without limitation by virtue
of such Person being a director or owning voting shares or interests), or acts,
directly or indirectly, for or on behalf of, any Person or entity on the SDN
List or a foreign government that is the target of U.S. economic sanctions
prohibitions such that the entry into, or performance under, this Agreement or
any other Loan Document would be prohibited under any Requirement of Law.

 

(b)                                 No part of the
proceeds from the Loans hereunder will be used, directly or indirectly, for any
payments to any governmental official or employee, political party, official of
a political party, candidate for political office, or anyone else acting in an
official capacity, in 

 

41

 

order to obtain, retain or direct business or obtain
any improper advantage, in violation of the United States Foreign Corrupt
Practices Act of 1977, as amended, assuming in all cases that such act applies
to the Borrower.

 

(c)                                  The Borrower
and its Subsidiaries are in compliance, in all material respects, with the Act.

 

ARTICLE IV

 

Conditions

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

(vi)                              a certificate
signed by the President, a Vice President or a Financial Officer of the Borrower,
certifying (a) that the representations and warranties of the Borrower set
forth in this Agreement are true and correct on and as of the Closing Date, (b) that
no Default has occurred and is continuing as of the Closing Date or would 

 

42

 

result from any Borrowing to
occur on the Closing Date, (c) that since December 31, 2009, there
has been no event, development or circumstance that has had or could reasonably
be expected, either individually or in the aggregate, to have a Material
Adverse Effect, and (d) the current Debt Ratings of the Borrower;

 

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

 

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

 

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

 

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

 

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

 

(d)                                 The Lenders
shall have received (a) audited consolidated financial statements of the
Borrower for the 2008 and 2009 fiscal years, and (b) unaudited interim consolidated
financial statements of the Borrower for each quarterly period ended subsequent
to the date of the latest applicable financial statements delivered pursuant to
clause (a) of this paragraph as to which such financial statements
are available, and such financial statements shall not, in the reasonable
judgment of the Lenders, reflect any material adverse change in the
consolidated financial condition of the Borrower, as reflected in the financial
statements or projections contained in the Confidential Information Memorandum.

 

(e)                                  The Closing
Date shall have occurred on or before October 4, 2010.

 

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

 

43

 

City
time, on October 4, 2010 (and, in the event such conditions are not so
satisfied or waived, the Commitments shall terminate at such time).

 

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

 

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

 

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

 

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

 

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

 

Each
Borrowing and the increase of the aggregate Commitments pursuant to Section 2.16
shall be deemed to constitute a representation and warranty by the Borrower on
the date thereof as to the matters specified in paragraphs (a) and (b) of
this Section (with references to “such Borrowing” being deemed to be
references to any such increase, as appropriate), provided that such
increase of the aggregate Commitments shall also be deemed to constitute a
representation and warranty by the Borrower that the matters specified in Section 3.04(b) are
true and correct on and as of the date thereof.

 

ARTICLE V

 

Affirmative Covenants

 

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

 

44

 

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

 

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

 

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

 

(c)                                  concurrently
with any delivery of financial statements under clause (a) or (b) above,
a Compliance Certificate signed by a Financial Officer of the Borrower (i) certifying
as to whether a Default has occurred and is continuing as of the date of such
Compliance Certificate and, if a Default has occurred and is continuing,
specifying the details thereof and any action taken or proposed to be taken
with respect thereto, (ii) setting forth reasonably detailed calculations
demonstrating compliance with Section 6.01, and (iii) stating
whether any change in GAAP or in the application thereof has occurred since the
date of the audited financial statements referred to in Section 3.04
and, if any such change has occurred, specifying the effect of such change on
the financial statements accompanying such certificate (which delivery may,
unless the Administrative Agent, or a Lender requests executed originals, be by
electronic communication including fax or email and shall be deemed to be an
original authentic counterpart thereof for all purposes);

 

(d)                                 promptly after
the same become publicly available, copies of all annual reports on Form 10-K,
all quarterly reports on Form 10-Q, all reports on Form 8-K (except
for such reports required to be filed pursuant to Item 2.02 of Form 8-K)
and all proxy statements, filed by the Borrower or any Subsidiary with the SEC,
or with any national securities exchange, or distributed by the Borrower to its
shareholders generally, as the case may be;

 

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

 

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

 

45

 

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

 

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

 

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

 

The
Borrower hereby acknowledges that (a) the Administrative Agent and/or the
Arranger will make available to the Lenders materials and/or information provided
by or on behalf of the Borrower hereunder (collectively, “Borrower Materials”)
by posting the Borrower Materials on IntraLinks or another similar electronic
system (the “Platform”) and (b) certain of the Lenders (each, a “Public
Lender”) may have personnel who do not wish to receive material non-public
information with respect to the Borrower or its Affiliates, or the respective
securities of any of the foregoing, and who may be engaged in investment and
other market-related activities with respect to such Persons’ securities.  The Borrower hereby agrees that (w) all
Borrower Materials that are to be made available to Public Lenders shall be
clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean that
the word “PUBLIC” shall appear prominently on the first page thereof; (x) by
marking Borrower Materials “PUBLIC,” the Borrower shall be deemed to have
authorized the Administrative Agent, the Arranger and the Lenders to treat such
Borrower Materials as not containing any material non-public information with
respect to the Borrower or its securities for purposes of United States Federal
and state securities laws (provided, however, that to the extent
such Borrower Materials constitute Information, they shall be treated as set
forth in Section 9.12); (y) all Borrower Materials marked “PUBLIC”
are permitted to be made available through a portion of the Platform designated
“Public Side Information;” and (z) the Administrative Agent and the 

 

46

 

Arranger
shall be entitled to treat any Borrower Materials that are not marked “PUBLIC”
as being suitable only for posting on a portion of the Platform that is not
designated “Public Side Information.”  Notwithstanding the foregoing, the Borrower
shall be under no obligation to mark any Borrower Materials “PUBLIC.”

 

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

 

(a)                                  the occurrence
of any Default;

 

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

 

(c)                                  the occurrence
of any (i) ERISA Event that, alone or together with any other ERISA Events
that have occurred, could reasonably be expected to result in liability of the
Borrower and its Subsidiaries in an aggregate amount exceeding $5,000,000 or (ii) determination
that any Pension Plan of the Borrower or any ERISA Affiliate is considered an
at-risk plan or a plan in endangered or critical status within the meaning of
Sections 430, 431 and 432 of the Code or Sections 303, 304 and 305 of ERISA;

 

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

 

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

 

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

 

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

 

Each
notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Borrower setting forth
the details of the event or development requiring such notice and any action
taken or proposed to be taken with respect thereto.  The Borrower may, by delivering to the
Administrative Agent written notice specifically referring to this Section 5.02,
notify the Lenders that the Borrower wishes to amend any Schedule to this
Agreement to include information about events, occurrences, or transactions
arising after the Closing Date that would render untrue any representation or
warranty by the Borrower under or pursuant to this Agreement.  Such amendment will be deemed effective as of
the date that such notice is delivered to the Administrative Agent upon the
Administrative Agent 

 

47

 

giving
notice to the Borrower and the Lenders within 10 Business Days from the receipt
thereof that the Required Lenders have consented thereto; provided, however,
that the consent of the Required Lenders shall not be required to amend Schedule
3.13 and Schedule 9.01.

 

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

 

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

 

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

 

SECTION 5.06. 
Books and Records; Inspection Rights.  The Borrower will, and will cause each of its
Subsidiaries to, (a) keep proper books of record and account in which
full, true and correct entries in conformity with GAAP consistently applied
shall be made of all dealings and transactions in relation to its business and
activities, and (b) maintain such books of record and account in material
conformity with all applicable requirements of any Governmental Authority
having regulatory jurisdiction over the Borrower or such Subsidiary, as the
case may be.  The Borrower will, and will
cause each of its Subsidiaries to, permit any representatives designated by the
Administrative Agent or any Lender, upon reasonable prior notice, to visit and
inspect its properties, to examine and make extracts from its books and records,
and to discuss its affairs, finances and condition with its officers and
independent accountants, all at such reasonable times and as often as
reasonably requested; provided, however, that upon the occurrence
and during the continuance of an Event of Default, the Administrative Agent or
any Lender (or any of their respective representatives or independent
contractors) may do any of the foregoing at the expense of the Borrower at any
time during normal business hours and without advance notice.

 

48

 

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

 

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

 

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

 

ARTICLE VI

 

Negative Covenants

 

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

 

SECTION 6.01. 
Financial Condition Covenants.

 

(a)                                  Consolidated
Leverage Ratio.  The
Borrower shall not permit the Consolidated Leverage Ratio as at the last day of
any Reference Period to equal or exceed the ratio of 3.0 to 1.0.

 

(b)                                 Consolidated
Interest Coverage Ratio.  The
Borrower shall not permit the Consolidated Interest Coverage Ratio as at the
last day of any Reference Period to be less than or equal to the ratio of 4.0
to 1.0.

 

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

 

49

 

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

 

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

 

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

 

(d)                                 Indebtedness of
any Person that becomes a Subsidiary after the date hereof; provided
that such Indebtedness exists at the time such Person becomes a Subsidiary and
is not created in contemplation of or in connection with such Person becoming a
Subsidiary, provided further that neither the Borrower nor any other
Subsidiary will assume or otherwise become directly or indirectly liable for
such Indebtedness;

 

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

 

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

 

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

 

(a)                                  Permitted
Encumbrances;

 

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

 

(c)                                  any Lien existing
on any property or asset prior to the acquisition thereof by the Borrower or
any Subsidiary or existing on any property or asset of any Person that becomes
a Subsidiary after the date hereof prior to the time such Person becomes a
Subsidiary; provided that (i) such Lien is not created in contemplation
of or in connection with such 

 

50

 

acquisition or such Person becoming a Subsidiary, as
the case may be, (ii) such Lien shall not apply to any other property or assets
of the Borrower or any Subsidiary, and (iii) such Lien shall secure only those
obligations which it secures on the date of such acquisition or the date such
Person becomes a Subsidiary, as the case may be; and

 

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

 

SECTION 6.04. 
Fundamental Changes. 
(a)  The Borrower will not, and
will not permit any Subsidiary to, merge into or consolidate with any other
Person, or permit any other Person to merge into or consolidate with it, or
sell, transfer, lease or otherwise dispose of (in one transaction or in a
series of transactions) all or substantially all of its assets, or all or
substantially all of the stock of any of its Subsidiaries (in each case,
whether now owned or hereafter acquired), or liquidate or dissolve, except
that, if at the time thereof and immediately after giving effect thereto no
Event of Default shall have occurred and be continuing (i) any other Person,
including a Subsidiary, may merge into the Borrower in a transaction in which
the Borrower is the surviving corporation (so long as any such acquisition of a
non-Subsidiary is a Permitted Acquisition), (ii) any Subsidiary may merge into
any wholly owned Subsidiary in a transaction in which the surviving entity is a
wholly owned Subsidiary, (iii) any Subsidiary may sell, transfer, lease or
otherwise dispose of its assets to the Borrower or to another wholly owned
Subsidiary, (iv) any Subsidiary may liquidate or dissolve if the Borrower
determines in good faith that such liquidation or dissolution is in the best
interests of the Borrower and is not materially disadvantageous to the Lenders,
and (v) so long as no Event of Default has occurred and is continuing or would
result therefrom, the Borrower may merge into or consolidate with another
Person in a transaction in which such other Person is the surviving entity if
such other Person (x) is organized and validly existing under the laws of the
United States or any State thereof, (y) such Person shall assume all
obligations of the Borrower hereunder, pursuant to an assumption agreement in
form and substance reasonably satisfactory to the Administrative Agent, and (z)
the Administrative Agent shall have received a favorable opinion of counsel to
such other Person covering such matters relating to such assumption as the
Administrative Agent may reasonably request, and which opinion shall otherwise
be in form and substance satisfactory to the Administrative Agent; provided
that any such merger involving a Person that is not a wholly owned Subsidiary
immediately prior to such merger shall not be permitted unless also permitted
by Section 6.05.

 

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

 

51

 

SECTION 6.05. 
Acquisitions; Hedging Agreements.

 

(a)                                  The Borrower
will not, and will not permit any of its Subsidiaries to purchase or otherwise
acquire (in one transaction or a series of transactions), including pursuant to
any merger with any Person that was not a wholly owned Subsidiary prior to such
merger, any assets of any other Person constituting a business unit, except,
Permitted Acquisitions.

 

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

 

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

 

SECTION 6.07. 
Transactions with Affiliates. 
The Borrower will not, and will not permit any of its Subsidiaries to,
sell, lease or otherwise transfer any property or assets to, or purchase, lease
or otherwise acquire any property or assets from, or otherwise engage in any
other transactions with, any of its Affiliates, except (a) in accordance with
the Borrower’s Corporate Code of Business Conduct and Ethics or as approved by
a committee of the Borrower’s Board of Directors or a majority of the
independent members of the Borrowers’ Board of Directors, (b) transactions
between or among the Borrower and its wholly owned Subsidiaries not involving
any other Affiliate, and (c) any Restricted Payment permitted by Section
6.06.

 

SECTION 6.08. 
Restrictive Agreements. 
The Borrower will not, and will not permit any of its Subsidiaries to,
directly or indirectly, enter into, incur or permit to exist any agreement or
other arrangement that prohibits, restricts or imposes any condition upon (a)
the ability of the Borrower or any Subsidiary to create, incur or permit to
exist any Lien upon any of its property or assets, or (b) the ability of any
Subsidiary to pay dividends or other distributions with respect to any shares
of its capital stock or to make or repay loans or advances to the Borrower or
any other Subsidiary or to Guarantee Indebtedness of the Borrower or any other 

 

52

 

Subsidiary;
provided that (i) the foregoing shall not apply to restrictions and
conditions imposed by law or by this Agreement, (ii) the foregoing shall not
apply to restrictions and conditions existing on the date hereof identified on Schedule
6.08 (but shall apply to any extension or renewal of, or any amendment or
modification expanding the scope of, any such restriction or condition), (iii)
the foregoing shall not apply to customary restrictions and conditions
contained in agreements relating to the sale of a Subsidiary pending such sale,
provided such restrictions and conditions apply only to the Subsidiary that is
to be sold and such sale is permitted hereunder, (iv) clause (a) of the
foregoing shall not apply to restrictions or conditions imposed by any
agreement relating to secured Indebtedness permitted by this Agreement if such
restrictions or conditions apply only to the property or assets securing such
Indebtedness, (v) clause (a) of the foregoing shall not apply to
customary provisions in leases restricting the assignment thereof, and (vi)
clause (a) of the foregoing shall not apply to any unsecured Indebtedness of
the Borrower which is pari passu to the Obligations hereunder.

 

SECTION 6.09. 
Sales and Leasebacks.  The
Borrower will not, and will not permit any of its Subsidiaries to, enter into
any arrangement with any Person providing for the leasing by the Borrower or
any Subsidiary of real or personal property that has been or is to be sold or
transferred by the Borrower or such Subsidiary to such Person or to any other
Person to whom funds have been or are to be advanced by such Person on the
security of such property or rental obligations of the Borrower or such
Subsidiary (a “Sale/Leaseback Transaction”), except Sale/Leaseback
Transactions (x) entered into with respect to the real property listed on Schedule
6.09 or (y) involving property with a value not to exceed $20,000,000 in
the aggregate during the term of this Agreement.

 

SECTION 6.10. 
Changes in Fiscal Periods. 
The Borrower will not permit the fiscal year of the Borrower to end on a
day other than December 31 or change the Borrower’s method of determining
fiscal quarters.

 

SECTION 6.11. 
Optional Payments and Modifications of Certain Debt Instruments.  The Borrower will not permit any of its
Subsidiaries to make or offer to make any optional or voluntary payment,
prepayment, repurchase or redemption of or otherwise optionally or voluntarily
defease any Indebtedness which is subordinated to the Obligations, or amend,
modify, waive or otherwise change, or consent or agree to any amendment,
modification, waiver or other change to, any of the terms relating to the
payment or prepayment of principal of or interest on, any such Indebtedness
(other than any such amendment, modification, waiver or other change that would
extend the maturity or reduce the amount of any payment of principal thereof or
reduce the rate or extend any date for payment of interest thereon).

 

SECTION 6.12. 
Use of Proceeds.  The
Borrower will not use the proceeds of any Loan, whether directly or indirectly,
and whether immediately, incidentally or ultimately, to purchase or carry
margin stock (within the meaning of Regulation U of the Regulations of the
Board) or to extend credit to others for the purpose of purchasing or carrying
margin stock or to refund indebtedness originally incurred for such purpose, in
each case so as to result in a violation of Regulation U.

 

53

 

SECTION 6.13. 
OFAC, Etc.  The Borrower
shall not, and shall not permit any of its Subsidiaries to fail to comply with
any of the requirements set forth in Section 3.18.

 

ARTICLE VII

 

Events of Default

 

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

 

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

 

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

 

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

 

(d)                                 the Borrower
shall fail to observe or perform any covenant, condition or agreement contained
in Sections 5.01, 5.02, 5.03 (with respect to the Borrower’s
existence), 5.06 (with respect to the inspection rights of the
Administrative Agent and the Lenders) or 5.08 or in Article VI;

 

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

 

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

 

(g)                                 any event or
condition occurs that results in any Material Indebtedness becoming due prior
to its scheduled maturity or that enables or permits (with or without the
giving of notice, the lapse of time or both) the holder or holders of any
Material Indebtedness or any trustee or agent on its or their behalf to cause
any Material Indebtedness to become due, or to require the prepayment,
repurchase, redemption or defeasance thereof, prior to its scheduled 

 

54

 

maturity; provided that this clause (g) shall
not apply to secured Indebtedness that becomes due as a result of the voluntary
sale or transfer of the property or assets securing such Indebtedness;

 

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

 

(i)                                     the Borrower or
any Subsidiary shall (i) voluntarily commence any proceeding or file any
petition seeking liquidation, reorganization or other relief under any Federal,
state or foreign bankruptcy, insolvency, receivership or similar law now or
hereafter in effect, (ii) consent to the institution of, or fail to contest in
a timely and appropriate manner, any proceeding or petition described in clause
(h) of this Article, (iii) apply for or consent to the appointment of a
receiver, trustee, custodian, sequestrator, conservator or similar official for
the Borrower or any Subsidiary or for a substantial part of its assets, (iv)
file an answer admitting the material allegations of a petition filed against
it in any such proceeding, (v) make a general assignment for the benefit of
creditors, or (vi) take any action for the purpose of effecting any of the
foregoing;

 

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

 

(k)                                  one or more
judgments for the payment of money in an aggregate amount in excess of
$25,000,000 shall be rendered against the Borrower, any Subsidiary or any
combination thereof and the same shall remain undischarged for a period of 45
consecutive days during which execution shall not be effectively stayed, or any
action shall be legally taken by a judgment creditor to attach or levy upon any
assets of the Borrower or any Subsidiary to enforce any such judgment;

 

(l)                                     An ERISA Event
occurs with respect to a Pension Plan or Multiemployer Plan which has resulted
or could reasonably be expected to result in liability of the Borrower under
Title IV of ERISA to the Pension Plan, Multiemployer Plan or the PBGC in
an aggregate amount in excess of $10,000,000, or (ii) the Borrower or any ERISA
Affiliate fails to pay when due, after the expiration of any applicable grace
period, any installment payment with respect to its withdrawal liability under
Section 4201 of ERISA under a Multiemployer Plan in an aggregate amount in
excess of $10,000,000;

 

(m)                               any material
provision of this Agreement or any other Loan Document, at any time after its
execution and delivery and for any reason other than as expressly permitted
hereunder or thereunder or satisfaction in full of all the obligations of the
Borrower hereunder or thereunder, ceases to be in full force and effect; or the
Borrower or any other Person contests in 

 

55

 

any manner the validity or enforceability of any
provision of any Loan Document; or the Borrower denies that it has any or
further liability or obligation under any provision of any Loan Document, or
purports to revoke, terminate or rescind any provision of any Loan Document; or

 

(n)                                 a Change in
Control shall occur;

 

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

 

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

 

(i)                                     First, to payment of
that portion of the obligations constituting fees, indemnities, expenses and
other amounts (including fees, charges and disbursements of counsel to the
Administrative Agent and amounts payable under Sections 2.11, 2.12
and 2.13) payable to the Administrative Agent in its capacity as such;

 

(ii)                                  Second, to payment of
that portion of the obligations constituting fees, indemnities and other
amounts (other than principal and interest) payable to the Lenders (including
fees, charges and disbursements of counsel to the respective Lenders and
amounts payable under Sections 2.11, 2.12 and 2.13),
ratably among them in proportion to the respective amounts described in this
clause Second payable to them;

 

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

 

56

 

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

 

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

 

ARTICLE VIII

 

The Administrative Agent

 

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

 

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

 

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

 

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

 

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

 

57

 

may expose the Administrative Agent to liability or
that is contrary to any Loan Document or Requirement of Law; and

 

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

 

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

 

The
Administrative Agent shall not be responsible for or have any duty to ascertain
or inquire into (i) any statement, warranty or representation made in or in
connection with this Agreement or any other Loan Document, (ii) the contents of
any certificate, report or other document delivered hereunder or thereunder or
in connection herewith or therewith, (iii) the performance or observance
of any of the covenants, agreements or other terms or conditions set forth
herein or therein or the occurrence of any Default, (iv) the validity,
enforceability, effectiveness or genuineness of this Agreement, any other Loan
Document or any other agreement, instrument or document or (v) the satisfaction
of any condition set forth in Article IV or elsewhere herein, other than
to confirm receipt of items expressly required to be delivered to the
Administrative Agent.

 

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

 

SECTION 8.05. 
Delegation of Duties.  The
Administrative Agent may perform any and all of its duties and exercise its
rights and powers hereunder or under any other Loan

 

58

 

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

 

SECTION 8.06. 
Resignation of Administrative Agent.  The Administrative Agent may at any time give
notice of its resignation to the Lenders and the Borrower.  Upon receipt of any such notice of
resignation, the Required Lenders shall have the right, in consultation with
the Borrower, to appoint a successor, which shall be a bank with an office in
the United States, or an Affiliate of any such bank with an office in the
United States.  If no such successor
shall have been so appointed by the Required Lenders and shall have accepted
such appointment within 30 days after the retiring Administrative Agent
gives notice of its resignation, then the retiring Administrative Agent may on behalf
of the Lenders, appoint a successor Administrative Agent meeting the
qualifications set forth above; provided that if the Administrative
Agent shall notify the Borrower and the Lenders that no qualifying Person has
accepted such appointment, then such resignation shall nonetheless become
effective in accordance with such notice and (1) the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder and under the other Loan Documents and (2) all payments, communications
and determinations provided to be made by, to or through the Administrative
Agent shall instead be made by or to each Lender directly, until such time as
the Required Lenders appoint a successor Administrative Agent as provided for
above in this Section.  Upon the
acceptance of a successor’s appointment as Administrative Agent hereunder, such
successor shall succeed to and become vested with all of the rights, powers,
privileges and duties of the retiring (or retired) Administrative Agent, and
the retiring Administrative Agent shall be discharged from all of its duties
and obligations hereunder or under the other Loan Documents (if not already
discharged therefrom as provided above in this Section).  The fees payable by the Borrower to a
successor Administrative Agent shall be the same as those payable to its
predecessor unless otherwise agreed between the Borrower and such
successor.  After the retiring
Administrative Agent’s resignation hereunder and under the other Loan
Documents, the provisions of this Article and Section 9.03
shall continue in effect for the benefit of such retiring Administrative Agent,
its sub-agents and their respective Related Parties in respect of any actions
taken or omitted to be taken by any of them while the retiring Administrative
Agent was acting as Administrative Agent.

 

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

 

59

 

upon
this Agreement, any other Loan Document or any related agreement or any
document furnished hereunder or thereunder.

 

SECTION 8.08. 
No Other Duties, Etc. 
Anything herein to the contrary notwithstanding, none of the Arrangers
or Co-Syndication Agents or Co-Documentation Agents listed on the cover page hereof
shall have any powers, duties or responsibilities under this Agreement or any
of the other Loan Documents, except in its capacity, as applicable, as the
Administrative Agent or a Lender hereunder.

 

ARTICLE IX

 

Miscellaneous

 

SECTION 9.01. 
Notices; Effectiveness; Electronic Communication.

 

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

 

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

 

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

 

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

 

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

 

60

 

pursuant to procedures approved by it, provided
that approval of such procedures may be limited to particular notices or
communications.

 

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

 

(c)                                  THE PLATFORM IS
PROVIDED “AS IS” AND “AS AVAILABLE.”  THE
AGENT PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF
THE BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY
FOR ERRORS IN OR OMISSIONS FROM THE BORROWER MATERIALS.  NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED
OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES
OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTION WITH THE
BORROWER MATERIALS OR THE PLATFORM.  In
no event shall the Administrative Agent or any of its Related Parties
(collectively, the “Agent Parties”) have any liability to the Borrower,
any Lender or any other Person for losses, claims, damages, liabilities or
expenses of any kind (whether in tort, contract or otherwise) arising out of
the Borrower’s or the Administrative Agent’s transmission of Borrower Materials
through the Internet, except to the extent that such losses, claims, damages,
liabilities or expenses are determined by a court of competent jurisdiction by
a final and nonappealable judgment to have resulted from the gross negligence
or willful misconduct of such Agent Party; provided, however,
that in no event shall any Agent Party have any liability to the Borrower, any
Lender or any other Person for indirect, special, incidental, consequential or
punitive damages (as opposed to direct or actual damages).

 

(d)                                 Each of the
Borrower and the Administrative Agent Lender may change its address, telecopier
or telephone number for notices and other communications hereunder by notice to
the other parties hereto.  Each other
Lender may change its address, telecopier or telephone number for notices and
other communications hereunder by notice to the Borrower, and the
Administrative Agent.  In addition, each
Lender agrees to notify the Administrative Agent from time to time to ensure
that the Administrative Agent has on record (i) an effective address,
contact name, telephone number, telecopier number and electronic mail address
to which notices and other communications may be sent and (ii) accurate
wire instructions for such Lender. 
Furthermore, each Public Lender agrees to cause at least one individual
at or on behalf of such Public Lender to at all times have selected the “Private
Side Information” or similar designation on the content declaration screen of
the Platform in order to enable such Public 

 

61

 

Lender or its delegate, in accordance with such
Public Lender’s compliance procedures and applicable law, including United
States Federal and state securities laws, to make reference to Borrower
Materials that are not made available through the “Public Side Information”
portion of the Platform and that may contain material non-public information
with respect to the Borrower or its securities for purposes of United States
Federal or state securities laws.

 

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

 

SECTION 9.02. 
Waivers; Amendments; Enforcement. 
(a)  No failure or delay by the Administrative Agent or any Lender
in exercising any right or power hereunder shall operate as a waiver thereof,
nor shall any single or partial exercise of any such right or power, or any
abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power.  The rights and remedies
of the Administrative Agent and the Lenders hereunder are cumulative and are
not exclusive of any rights or remedies that they would otherwise have.  No waiver of any provision of this Agreement
or any other Loan Document or consent to any departure by the Borrower
therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) of this Section, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which
given.  Without limiting the generality
of the foregoing, the making of a Loan shall not be construed as a waiver of
any Default, regardless of whether the Administrative Agent or any Lender may
have had notice or knowledge of such Default at the time.

 

(b)                                 No Loan
Document or any provision thereof may be waived, amended or modified except
pursuant to an agreement or agreements in writing entered into by the Borrower
and the Required Lenders or by the Borrower and the Administrative Agent with
the consent of the Required Lenders; provided that no such agreement
shall (i) waive any condition set forth in Section 4.01(a) without
the written consent of each Lender, (ii) extend or increase the Commitment
of any Lender (or reinstate any Commitment terminated pursuant to Article VII)
without the written consent of such Lender, (iii) reduce the principal
amount of any Loan or reduce the rate of interest thereon, or reduce any fees
payable hereunder, without the written consent of each Lender affected thereby,
(iv) postpone the scheduled date of payment of the principal amount of any
Loan, or any interest thereon, fees or other amounts due to the Lenders (or any
of them), or reduce the amount of, waive or excuse any such payment, or
postpone the scheduled date of expiration of any Commitment, without the
written consent of each Lender affected thereby, (v) change Section 2.14(b) or
(c) in a manner that would alter the pro rata sharing of payments
required thereby, without the written consent of each Lender, or (vi) change

 

62

 

any of the provisions of this Section or the
definition of “Required Lenders” or any other provision hereof specifying the
number or percentage of Lenders required to waive, amend or modify any rights
hereunder or make any determination or grant any consent hereunder, without the
written consent of each Lender; provided  further that (x) no
such agreement shall amend, modify or otherwise affect the rights or duties of
the Administrative Agent hereunder without the prior written consent of the
Administrative Agent, and (y) the Fee Letter may be amended, or rights or
privileges thereunder waived, in a writing executed only by the parties
thereto.  Notwithstanding anything to the
contrary herein, no Defaulting Lender shall have any right to approve or
disapprove any amendment, waiver or consent hereunder (and any amendment,
waiver or consent which by its terms requires the consent of all Lenders may be
effected with the consent of all Lenders other than Defaulting Lenders), except
that (x) the Commitment of any Defaulting Lender may not be increased or
extended without the consent of such Lender and (y) any waiver, amendment
or the modification requiring the consent of all Lenders or each affected Lender
that by its terms affects any Defaulting Lender more adversely than other
affected Lenders shall require the consent of such Defaulting Lender.

 

(c)                                  Notwithstanding
anything to the contrary contained herein or in any other Loan Document, the
authority to enforce rights and remedies hereunder and under the other Loan
Documents against the Borrower shall be vested exclusively in, and all actions
and proceedings at law in connection with such enforcement shall be instituted
and maintained exclusively by, the Administrative Agent in accordance with Article VII
for the benefit of all the Lenders; provided, however, that the
foregoing shall not prohibit (a) the Administrative Agent from exercising
on its own behalf the rights and remedies that inure to its benefit (solely in
its capacity as Administrative Agent) hereunder and under the other Loan
Documents, (b) any Lender from exercising setoff rights in accordance with
Section 9.08 (subject to the terms of Section 2.14), or
(c) any Lender from filing proofs of claim or appearing and filing
pleadings on its own behalf during the pendency of a proceeding relative to the
Borrower under any bankruptcy or insolvency proceeding; and provided, further,
that if at any time there is no Person acting as Administrative Agent hereunder
and under the other Loan Documents, then (i) the Required Lenders shall
have the rights otherwise ascribed to the Administrative Agent pursuant to Article VII
and (ii) in addition to the matters set forth in clauses (b) and
(c) of the preceding proviso and subject to Section 2.14,
any Lender may, with the consent of the Required Lenders, enforce any rights
and remedies available to it and as authorized by the Required Lenders.

 

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

 

63

 

Section,
or (B) in connection with the Loans made hereunder, including all such out
of pocket expenses incurred during any workout, restructuring or negotiations
in respect of such Loans.

 

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

 

(c)                                  To the extent
that the Borrower for any reason fails to indefeasibly pay any amount required
under subsection (a) or (b) of this Section to
be paid by it to the Administrative Agent (or any sub-agent thereof), or any
Related Party of the Administrative Agent, each Lender severally agrees to pay
to the Administrative Agent (or any such sub-agent), or such Related Party, as
the case may be, such Lender’s Applicable Percentage (determined as of the time
that the applicable unreimbursed expense or indemnity payment is sought) of
such unpaid amount, provided that the unreimbursed expense or
indemnified loss, claim, damage, liability or related expense, as the case may
be, was incurred by or asserted against the Administrative Agent (or any such
sub-agent) in its capacity as such, or against any such Related Party acting
for the Administrative Agent (or any such sub-agent) in connection with such
capacity.  The obligations of the Lenders
under this subsection (c) are subject to the provisions of Section 2.14(e).

 

(d)                                 To the fullest
extent permitted by applicable law, the Borrower shall not assert, and hereby
waives, any claim against any Indemnitee, on any theory of liability, for
special, indirect, consequential or punitive damages (as opposed to direct or
actual damages) 

 

64

 

arising out of, in connection with, or as a result
of, this Agreement, any other Loan Document or any agreement or instrument
contemplated hereby, the transactions contemplated hereby or thereby, any Loan
or the use of the proceeds thereof.  No
Indemnitee referred to in subsection (b) above shall be liable for
any damages arising from the use by unintended recipients of any information or
other materials distributed to such unintended recipients by such Indemnitee
through telecommunications, electronic or other information transmission
systems in connection with this Agreement or the other Loan Documents or the
transactions contemplated hereby or thereby other than for direct or actual
damages resulting from the gross negligence or willful misconduct of such
Indemnitee as determined by a final and nonappealable judgment of a court of
competent jurisdiction.

 

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

 

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

 

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

 

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

 

(i)                                     Minimum Amounts.

 

(A)                              in the case of an assignment
of the entire remaining amount of the assigning Lender’s Commitment and the
Loans at the time owing to it or in the case of an assignment to a Lender, an
Affiliate 

 

65

 

of a Lender or an Approved Fund, no minimum amount
need be assigned; and

 

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

 

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

 

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

 

(A)                              the consent of
the Borrower (such consent not to be unreasonably withheld or delayed) shall be
required unless (1) an Event of Default has occurred and is continuing at
the time of such assignment or (2) such assignment is to a Lender, an
Affiliate of a Lender or an Approved Fund; provided that the Borrower
shall be deemed to have consented to any such assignment unless it shall object
thereto by written notice to the Administrative Agent within five (5) Business
Days after having received notice thereof; and

 

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

 

66

 

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

 

(v)                                 No Assignment
to Borrower or Defaulting Lenders.  No such assignment shall be made to (A) the
Borrower or any of the Borrower’s Affiliates or Subsidiaries or (B) any
Defaulting Lender or any of its subsidiaries, or any Person who, upon becoming
a Lender hereunder, would constitute any of the foregoing Persons described in
this clause (B).

 

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

 

(vii)                           Certain
Additional Payments. In connection with any assignment of rights and
obligations of any Defaulting Lender hereunder, no such assignment shall be
effective unless and until, in addition to the other conditions thereto set
forth herein, the parties to the assignment shall make such additional payments
to the Administrative Agent in an aggregate amount sufficient, upon
distribution thereof as appropriate (which may be outright payment, purchases
by the assignee of participations or subparticipations, or other compensating
actions, including funding, with the consent of the Borrower and the
Administrative Agent, the applicable pro rata share of Loans previously
requested but not funded by the Defaulting Lender, to each of which the
applicable assignee and assignor hereby irrevocably consent), to (x) pay
and satisfy in full all payment liabilities then owed by such Defaulting Lender
to the Administrative Agent or any Lender hereunder (and interest accrued
thereon) and (y) acquire (and fund as appropriate) its full pro rata share
of all Loans in accordance with its Applicable Percentage.

 

Subject
to acceptance and recording thereof by the Administrative Agent pursuant to subsection
(c) of this Section, from and after the effective date specified in
each Assignment and Assumption, the assignee thereunder shall be a party to
this Agreement and, to the extent of the interest assigned by such Assignment
and Assumption, have the rights and obligations of a Lender under this
Agreement, and the assigning Lender thereunder shall, to the extent of the
interest assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender’s rights and obligations under
this Agreement, such Lender shall cease to be a party hereto) but shall
continue to be entitled to the benefits of Sections 2.11, 2.12, 2.13
and 9.03 with respect to facts and circumstances occurring prior to the
effective date of such assignment.  Upon
request, the Borrower (at its expense) shall execute and deliver a Note to the
assignee Lender.  Any assignment or
transfer by a Lender of rights or obligations under this Agreement that does
not comply with this subsection shall be treated for purposes of this Agreement
as a sale by such 

 

67

 

Lender
of a participation in such rights and obligations in accordance with subsection
(d) of this Section.

 

(c)                                  The Administrative
Agent, acting solely for this purpose as an agent (and such agency being solely
for tax purposes) of the Borrower, shall maintain at the Administrative Agent’s
Office a copy of each Assignment and Assumption delivered to it and a register
for the recordation of the names and addresses of the Lenders, the designation
of any Lender as a Defaulting Lender, and the Commitments of, and principal
amounts of the Loans owing to, each Lender pursuant to the terms hereof from
time to time (the “Register”).  The
entries in the Register shall be conclusive, and the Borrower, the
Administrative Agent and the Lenders may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Agreement, notwithstanding notice to the contrary.  In addition, the Administrative Agent shall
maintain on the Register information regarding the designation, and revocation
of designation, of any Lender as a Defaulting Lender.  The Register shall be available
for inspection by the Borrower and any Lender, at any reasonable time and from
time to time upon reasonable prior notice.

 

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

 

Any agreement or instrument pursuant to which a
Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided that
such agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, waiver or other
modification described in the first proviso to Section 9.02(b) that
affects such Participant.  Subject to subsection
(e) of this Section, the Borrower agrees that each Participant shall
be entitled to the benefits of Sections 2.11, 2.12 and 2.13  to the same extent as if it were a Lender and had acquired
its interest by assignment pursuant to subsection (b) of this
Section.  To the extent permitted by law,
each Participant also shall be entitled to the benefits of Section 9.08  as though it were a Lender, provided such
Participant agrees to be subject to Section 2.14 as though it were
a Lender.

 

(e)                                  A Participant
shall not be entitled to receive any greater payment under Section 2.11
or 2.13 than the applicable Lender would have been entitled to receive
with respect to the participation sold to such Participant, unless the sale of
the participation to such Participant is made with the Borrower’s prior written
consent.  A Participant that would be a
Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 2.13
unless the Borrower is

 

68

 

notified of the participation sold to such
Participant and such Participant agrees, for the benefit of the Borrower, to
comply with Section 2.13(e) as though it were a Lender.

 

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

 

SECTION 9.05. 
Survival.  All
representations and warranties made hereunder and in any other Loan Document or
other document delivered pursuant hereto or thereto or in connection herewith
or therewith shall survive the execution and delivery hereof and thereof.  Such representations and warranties have been
or will be relied upon by the Administrative Agent and each Lender, regardless
of any investigation made by the Administrative Agent or any Lender or on their
behalf and notwithstanding that the Administrative Agent or any Lender may have
had notice or knowledge of any Default at the time of any Credit Extension, and
shall continue in full force and effect as long as any Loan or any fee or any
other amount payable hereunder shall remain unpaid or unsatisfied.  The provisions of Sections 2.11, 2.12,
2.13 and 9.03 and Article VIII shall survive and
remain in full force and effect regardless of the consummation of the
transactions contemplated hereby, the repayment of the Loans, the expiration or
termination of the Commitments or the termination of this Agreement or any
provision hereof.

 

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

 

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

 

69

 

SECTION 9.08. 
Right of Setoff.  If an
Event of Default shall have occurred and be continuing, each Lender is hereby
authorized at any time and from time to time, to the fullest extent permitted
by law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and other indebtedness at any time
owing by such Lender to or for the credit or the account of the Borrower
against any of and all of the obligations of the Borrower now or hereafter
existing under this Agreement or any other Loan Document owing to such Lender,
irrespective of whether or not such Lender shall have made any demand under
this Agreement or any other Loan Document and although such obligations may be
unmatured; provided, that in the event that any Defaulting Lender shall
exercise any such right of setoff, (x) all amounts so set off shall be
paid over immediately to the Administrative Agent for further application in
accordance with the provisions of Section 2.17 and, pending such
payment, shall be segregated by such Defaulting Lender from its other funds and
deemed held in trust for the benefit of the Administrative Agent and the
Lenders, and (y) the Defaulting Lender shall provide promptly to the
Administrative Agent a statement describing in reasonable detail the
Obligations owing to such Defaulting Lender as to which it exercised such right
of setoff.  The rights of each Lender
under this Section are in addition to other rights and remedies (including
other rights of setoff) which such Lender may have.

 

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

 

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

 

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

 

70

 

defense of an inconvenient forum to the maintenance
of such action or proceeding in any such court.

 

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

 

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

 

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

 

SECTION 9.12. 
Confidentiality.  Each of
the Administrative Agent and the Lenders agrees to maintain the confidentiality
of the Information (as defined below), except that Information may be disclosed
(a) to its Affiliates and to its and its Affiliates’ respective partners,
directors, officers, employees, agents, trustees, advisors and representatives
(it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep
such Information confidential), (b) to the extent requested by any
regulatory authority purporting to have jurisdiction over it (including any
self-regulatory authority, such as the National Association of Insurance
Commissioners), (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (d) to any other
party hereto, (e) in connection with the exercise of any remedies
hereunder or under any other Loan Document or any action or proceeding relating
to this Agreement or any other Loan Document or the enforcement of rights
hereunder or thereunder, (f) subject to an agreement containing provisions
substantially the same as those of this Section, to (i) any assignee of or
Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement or any Eligible Assignee invited to
be a Lender pursuant to Section 2.16 or (ii) any actual or
prospective counterparty (or its advisors) to any swap or derivative
transaction relating to the Borrower and its obligations, (g) with the
consent of the Borrower or (h) to the extent such Information (x) becomes
publicly available other than as a result of a breach of this 

 

71

 

Section or
(y) becomes available to the Administrative Agent, any Lender or any of
their respective Affiliates on a nonconfidential basis from a source other than
the Borrower.

 

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

 

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

 

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

 

SECTION 9.14. 
No Advisory or Fiduciary Responsibility.  In connection with all aspects of each
transaction contemplated hereby (including in connection with any amendment,
waiver or other modification hereof or of any other Loan Document), the
Borrower acknowledges and agrees, and acknowledges its Affiliates’
understanding, that: (i) (A) the arranging and other services
regarding this Agreement provided by the Administrative Agent and the Arranger
are arm’s-length commercial transactions between the Borrower and its
Affiliates, on the one hand, and the Administrative Agent and the Arranger, on
the other hand, (B) the Borrower has consulted its own legal, accounting,
regulatory and tax advisors to the extent it has deemed appropriate, and (C) the
Borrower is capable of evaluating, and understands and accepts, the terms,
risks and conditions of the transactions contemplated hereby and by the other
Loan Documents; (ii) (A) the Administrative Agent and the Arranger
each is and has been acting 

 

72

 

solely
as a principal and, except as expressly agreed in writing by the relevant
parties, has not been, is not, and will not be acting as an advisor, agent or
fiduciary for the Borrower or any of its Affiliates, or any other Person and (B) neither
the Administrative Agent nor the Arranger has any obligation to the Borrower or
any of its Affiliates with respect to the transactions contemplated hereby
except those obligations expressly set forth herein and in the other Loan
Documents; and (iii) the Administrative Agent and the Arranger and their
respective Affiliates may be engaged in a broad range of transactions that involve
interests that differ from those of the Borrower and its Affiliates, and
neither the Administrative Agent nor the Arranger has any obligation to
disclose any of such interests to the Borrower or its Affiliates.  To the fullest extent permitted by law, the
Borrower  hereby waives and releases any
claims that it may have against the Administrative Agent and the Arranger with
respect to any breach or alleged breach of agency or fiduciary duty in
connection with any aspect of any transaction contemplated hereby.

 

SECTION 9.15. 
USA Patriot Act.  Each
Lender that is subject to the Act (as hereinafter defined) and the
Administrative Agent (for itself and not on behalf of any Lender) hereby
notifies the Borrower that pursuant to the requirements of the USA PATRIOT Act
(Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”),
it is required to obtain, verify and record information that identifies the
Borrower, which information includes the name and address of the Borrower and
other information that will allow such Lender or the Administrative Agent, as
applicable, to identify the Borrower in accordance with the Act.  The Borrower shall, promptly following a
request by the Administrative Agent or any Lender, provide all documentation
and other information that the Administrative Agent or such Lender requests in
order to comply with its ongoing obligations under applicable “know your
customer” and anti-money laundering rules and regulations, including the
Act.

 

[Remainder of Page Left Intentionally Blank]

 

73

 

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

 

 

	
   

  	
  Borrower:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  WADDELL &
  REED FINANCIAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:
  

  	
  /s/
  Daniel P. Connealy

  
	
   

  	
   

  	
  Name:

  	
  Daniel
  P. Connealy

  
	
   

  	
   

  	
  Title:

  	
  Senior
  Vice President and Chief 

  Financial Officer

  

 

[Signature Page to WDR
Credit Agreement – 2010]

 

 

	
   

  	
  Administrative
  Agent:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BANK
  OF AMERICA, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:
  

  	
  /s/
  William A. Cessna

  
	
   

  	
   

  	
  Name:

  	
  William
  A. Cessna

  
	
   

  	
   

  	
  Title:

  	
  Vice
  President

  

 

[Signature Page to WDR
Credit Agreement – 2010]

 

 

	
   

  	
  Lenders:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BANK
  OF AMERICA, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Helene De Luca

  
	
   

  	
   

  	
  Name:

  	
  Helene
  De Luca

  
	
   

  	
   

  	
  Title:

  	
  Senior
  Vice President

  

 

[Signature Page to WDR
Credit Agreement – 2010]

 

 

	
   

  	
  Lenders
  (cont’d):

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  UMB
  BANK, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  David A. Proffitt

  
	
   

  	
   

  	
  Name:

  	
  David
  A. Proffitt

  
	
   

  	
   

  	
  Title:

  	
  Senior
  Vice President

  

 

[Signature
Page to WDR Credit Agreement – 2010]

 

 

	
   

  	
  Lenders
  (cont’d):

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THE
  BANK OF NOVA SCOTIA

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  David Mahmood

  
	
   

  	
   

  	
  Name:

  	
  David
  Mahmood

  
	
   

  	
   

  	
  Title:

  	
  Managing
  Director

  

 

[Signature
Page to WDR Credit Agreement – 2010]

 

 

	
   

  	
  Lenders
  (cont’d):

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CITIBANK, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Dane Graham

  
	
   

  	
  Name:

  	
  Dane
  Graham

  
	
   

  	
  Title:

  	
  Vice
  President

  

 

[Signature
Page to WDR Credit Agreement – 2010]

 

 

	
   

  	
  Lenders
  (cont’d):

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  WELLS
  FARGO BANK, NATIONAL ASSOCIATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Casey Connelly

  
	
   

  	
  Name:

  	
  Casey
  Connelly

  
	
   

  	
  Title:

  	
  Vice
  President

  

 

[Signature
Page to WDR Credit Agreement – 2010]

 

 

	
   

  	
  Lenders
  (cont’d):

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  COMMERCE
  BANK, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Jeffrey M. Turner

  
	
   

  	
  Name:

  	
  Jeffrey
  M. Turner

  
	
   

  	
  Title:
  

  	
  Vice
  President

  

 

[Signature
Page to WDR Credit Agreement – 2010]

 

 

	
   

  	
  Lenders
  (cont’d):

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  M &
  I MARSHALL & ILSLEY BANK

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  David T. Hunt

  
	
   

  	
  Name:

  	
  David
  T. Hunt

  
	
   

  	
  Title:

  	
  Vice
  President

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Aaron Wiechman

  
	
   

  	
  Name:

  	
  Aaron
  Wiechman

  
	
   

  	
  Title:

  	
  Assistant
  Vice President

  

 

[Signature
Page to WDR Credit Agreement – 2010]

 

 

 

SCHEDULE 2.01

 

COMMITMENTS

 

	
  Lender

  	
   

  	
  Commitment

  	
   

  
	
  Bank
  of America, N.A.

  	
   

  	
  $

  	
  24,000,000.00

  	
   

  
	
  UMB Bank, N.A.

  	
   

  	
  $

  	
  22,000,000.00

  	
   

  
	
  The
  Bank of Nova Scotia

  	
   

  	
  $

  	
  22,000,000.00

  	
   

  
	
  Citibank,
  N.A.

  	
   

  	
  $

  	
  18,000,000.00

  	
   

  
	
  Wells
  Fargo Bank, National Association

  	
   

  	
  $

  	
  18,000,000.00

  	
   

  
	
  Commerce
  Bank, N.A.

  	
   

  	
  $

  	
  12,500,000.00

  	
   

  
	
  M &
  I Marshall & Ilsley Bank

  	
   

  	
  $

  	
  8,500,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
  $

  	
  125,000,000.00

  	
   

  

 

 

SCHEDULE 3.04

 

FINANCIAL CONDITION

 

None

 

 

SCHEDULE 3.06

 

DISCLOSED MATTERS

 

1.                                       Michael
E. Taylor, Kenneth B. Young, individuals, on behalf of themselves individually
and on behalf of others similarly situated v. Waddell & Reed, Inc.,
a Delaware Corporation; Waddell & Reed Financial, Inc., a
Delaware Corporation; Waddell & Reed Development, Inc., a
Delaware Corporation; Waddell & Reed Financial Advisors, a fictitious
business name; and DOES 1 through 10 inclusive; Case No. 09-CV-2909 DMS
WVG; in the United States District Court for the Southern District of
California.

 

In
an action filed December 28, 2009, the Company, along with various of its
affiliates, were sued in an individual action, class action and Fair Labor
Standards Act (“FLSA”) nationwide collective action by two former advisors
asserting misclassification of financial advisors as independent contractors
instead of employees.  Plaintiffs assert
claims under the FLSA for minimum wages and overtime wages, and under
California Labor Code Statutes for timely pay wages, minimum wages, overtime
compensation, meal periods, reimbursement of losses and business expenses and
itemized wage statements and a claim for Unfair Business Practices under §17200
of the California Business & Professions Code.  Plaintiffs seek declaratory and injunctive
relief and monetary damages.  The Company
intends to vigorously contest plaintiffs’ claims.

 

In
the opinion of management, the ultimate resolution and outcome of this matter
is uncertain.  At this stage of the
litigation, the Company is unable to estimate the expense or exposure, if any,
that it may represent.   The ultimate
resolution of this matter, or an adverse determination against the Company,
could have a material adverse impact on the financial position and results of
operations of the Company.  However, this
possible impact is unknown and not reasonably determinable; therefore, no
liability has been recorded in the consolidated financial statements.

 

 

SCHEDULE 3.10

 

PENSION PLANS

 

PART D

 

1.                                       Waddell & Reed Financial, Inc. Retirement Income Plan, as
amended and restated.

 

 

SCHEDULE 3.13

 

SUBSIDIARIES

 

PART A

 

	
  Name

  	
   

  	
  Jurisdiction
  of 

  Incorporation

  or Formation

  	
   

  	
  % of Capital Stock

  Owned by Borrower(1)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Waddell &
  Reed Financial Services, Inc.

  	
   

  	
  Missouri

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Waddell &
  Reed, Inc.

  	
   

  	
  Delaware

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Waddell &
  Reed Investment Management Company

  	
   

  	
  Kansas

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Waddell &
  Reed Services Company

  	
   

  	
  Missouri

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W&R
  Capital Management Group, Inc.

  	
   

  	
  Delaware

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W&R
  Corporate LLC

  	
   

  	
  Delaware

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy
  Investment Management Company

  	
   

  	
  Delaware

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy
  Funds Distributor, Inc.

  	
   

  	
  Florida

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W &
  R Insurance Agency, Inc.

  	
   

  	
  Missouri

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W &
  R Insurance Agency of Alabama, Inc.

  	
   

  	
  Alabama

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W &
  R Insurance Agency of Colorado, Inc.

  	
   

  	
  Colorado

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W &
  R Insurance Agency of Montana, Inc.

  	
   

  	
  Montana

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W &
  R Insurance Agency of Nevada, Inc.

  	
   

  	
  Nevada

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W &
  R Insurance Agency of Utah, Inc.

  	
   

  	
  Utah

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W &
  R Insurance Agency of Wisconsin, Inc.

  	
   

  	
  Wisconsin

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Unicon
  Agency, Inc.

  	
   

  	
  New
  York

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Unicon
  Insurance Agency of Massachusetts, Inc.

  	
   

  	
  Massachusetts

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fiduciary
  Trust Company of New Hampshire

  	
   

  	
  New
  Hampshire

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Legend
  Group Holdings, LLC

  	
   

  	
  Delaware

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Legend
  Advisory Corporation

  	
   

  	
  New
  York

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Legend
  Equities Corporation

  	
   

  	
  Delaware

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Advisory
  Services Corporation

  	
   

  	
  Nevada

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  Legend Group, Inc.

  	
   

  	
  Delaware

  	
   

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LEC
  Insurance Agency, Inc.

  	
   

  	
  Texas

  	
   

  	
  100

  	
  %

  

 

(1) Owned directly or indirectly through one or
more wholly-owned subsidiaries

 

 

PART B

 

1.                                       Sciens Capital
Partners, L.P.

 

2.                                       PB Holdings 1,
LLC

 

3.                                       Northern
Hellenic Holdings, LLC

 

 

SCHEDULE 6.02

 

EXISTING INDEBTEDNESS

 

1.                                       Waddell &
Reed, Inc. - $748 thousand of capital lease obligations.

 

2.                                       W&R
Corporate LLC - $10 thousand of capital lease obligations.

 

3.                                       Advisory
Services Corporation - $15 thousand of capital lease obligations.

 

 

SCHEDULE 6.03

 

EXISTING LIENS

 

1.                                       Aircraft Lease,
dated as of September 24, 2008 between Wilmington Trust Company, not in
its individual capacity, but solely as the Owner Trustee under Trust Agreement
dated as of April 3, 2006 as Lessor and Waddell & Reed, Inc.
as Lessee.

 

 

SCHEDULE 6.08

 

EXISTING RESTRICTIONS

 

1.                                       Section 10.3(e) of
that certain Note Purchase Agreement, dated as of August 31, 2010, by and
between Waddell & Reed Financial, Inc. and the purchasers party
thereto related to the Company’s $190.0 million in senior unsecured notes
contains and “equal and ratable” securitization provision with respect to
liens.

 

 

SCHEDULE 6.09

 

SALE/LEASEBACK PROPERTIES

 

1.                                       6300 Lamar
Avenue, Overland Park, Kansas

 

2.                                       6301 Glenwood, Overland Park, Kansas

 

 

SCHEDULE 9.01

 

ADMINISTRATIVE
AGENT’S OFFICE;

CERTAIN
ADDRESSES FOR NOTICES

 

BORROWER:

Waddell &
Reed Financial, Inc.

6300 Lamar Avenue

Overland Park, Kansas 66202

Attention: 
Wendy J. Hills, Secretary, Vice President and Associate General Counsel

Telephone: 913-236-2013

Telecopier:
913-236-2725

Electronic
Mail: whills@waddell.com

Website
Address:                                               www.
waddell.com

U.S. Taxpayer Identification Number: 51-0261715

 

ADMINISTRATIVE AGENT:

 

Administrative
Agent’s Office

(for
payments and Requests for Borrowings):

Bank of America, N.A.

101 North Tryon Street

NC1-001-04-39

Charlotte, North Carolina 28255

Attention: 
Eric Allen Smith

Telephone: 
980.386.5115

Facsimile: 
704.409.0273

Electronic Mail: eric.a.smith@bankofamerica.com

Account No.:  
1366212250600

Ref:   Waddell &
Reed Financial, Inc.

ABA# 026009593

 

Other
Notices as Administrative Agent:

Bank of America, N.A.

Agency Management Group

101 North Tryon Street

NC1-001-15-14

Charlotte, North Carolina 28255-0001

Attention: William A. Cessna

Telephone: 980.388.1639

Facsimile: 704.264.2501

Electronic Mail: william.a.cessna@bankofamerica.com

 

 

EXHIBIT A

 

ASSIGNMENT
AND ASSUMPTION

 

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

 

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

 

1.                                       Assignor[s]:

 

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

 

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

 

(3)                                  Select as appropriate.

 

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

 

A-1

 

 

2.                                       Assignee[s]:

 

 

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

 

3.                                       Borrower:                                            Waddell & Reed Financial, Inc.

 

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

 

5.                                       Credit Agreement:                                               Credit Agreement, dated as of August 31, 2010 (as
amended, restated, extended, supplemented or otherwise modified in writing from
time to time), among Waddell & Reed Financial, Inc., the Lenders
from time to time party thereto, and Bank
of America, N.A., as Administrative Agent

 

6.                                       Assigned Interest:

 

	
  Assignor[s](5)

  	
   

  	
  Assignee[s](6)

  	
   

  	
  Aggregate

  Amount of

  Commitment

  for all
  Lenders(7)

  	
   

  	
  Amount of

  Commitment

  Assigned

  	
   

  	
  Percentage

  Assigned of

  Commitment

  	
   

  	
  CUSIP

  Number

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  %

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  %

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  %

  	
   

  	
   

  

 

[7.                                   Trade
Date:                       ](8)

 

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

 

(5)                                  List each Assignor, as appropriate.

 

(6)                                  List each Assignee, as appropriate.

 

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

 

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

 

A-2

 

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

 

	
   

  	
   

  	
  ASSIGNOR

  
	
   

  	
   

  	
  [NAME OF ASSIGNOR]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By: 

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ASSIGNEE

  
	
   

  	
   

  	
  [NAME OF ASSIGNEE]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By: 

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
  [Consented to
  and](9) Accepted:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  BANK OF AMERICA, N.A., as

  	
   

  	
   

  
	
  Administrative Agent

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  [Consented to:](10)

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  WADDELL & REED
  FINANCIAL, INC.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  

 

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

 

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

 

A-3

 

ANNEX 1 TO ASSIGNMENT AND ASSUMPTION

 

STANDARD
TERMS AND CONDITIONS FOR

 

ASSIGNMENT
AND ASSUMPTION

 

1.                                       Representations and Warranties.

 

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

 

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

 

A-4

 

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

 

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

 

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

 

A-5

 

EXHIBIT B

 

FORM OF
NOTE

 

                 ,
      

 

FOR VALUE RECEIVED, the undersigned
(the “Borrower”),
hereby promises to pay to [NAME OF LENDER] or registered assigns (the “Lender”),
in accordance with the provisions of the Agreement (as hereinafter defined),
the principal amount of each Loan from time to time made by the Lender to the
Borrower under that certain Credit Agreement, dated as of August 31, 2010
(as amended, restated, extended, supplemented or otherwise modified in writing
from time to time, the “Agreement;” the terms defined therein being used herein as
therein defined), among the Borrower, the Lenders from time to time party
thereto, and Bank of America, N.A., as Administrative Agent.

 

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

 

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

 

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

 

[Remainder of Page Left Intentionally
Blank]

 

B-1

 

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

 

	
   

  	
  WADDELL & REED
  FINANCIAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

B-2

 

LOANS AND PAYMENTS WITH RESPECT
THERETO

 

	
  Date

  	
   

  	
  Type of

  Loan Made

  	
   

  	
  Amount of

  Loan Made

  	
   

  	
  End of

  Interest

  Period

  	
   

  	
  Amount of

  Principal or

  Interest Paid

  This Date

  	
   

  	
  Outstanding

  Principal

  Balance This

  Date

  	
   

  	
  Notation

  Made By

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

B-3

 

W A D D E L
L  &  R E E D  F I N A N C I A L, I N C.

Mutual Fund Management Fees by Fund Family

2010 Actual ($000)

 

Exhibit C-1

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  % Inc (Dec)

  	
   

  	
  Total

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  % of

  	
   

  	
  YTD Mgmt

  	
   

  	
  Variance

  	
   

  	
  2009

  	
   

  	
  Year

  	
   

  
	
   

  	
   

  	
  Jan

  	
   

  	
  Feb

  	
   

  	
  Mar

  	
   

  	
  Apr

  	
   

  	
  May

  	
   

  	
  Jun

  	
   

  	
  Jul

  	
   

  	
  Aug

  	
   

  	
  Sep

  	
   

  	
  Oct

  	
   

  	
  Nov

  	
   

  	
  Dec

  	
   

  	
  Y-T-D

  	
   

  	
  Total

  	
   

  	
  Fee Rate

  	
   

  	
  From L-Y

  	
   

  	
  Actual

  	
   

  	
  2009

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W&R Advisors Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Accumulative

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cash Management

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Continental Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Investment

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Government Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  New Concepts

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Retirement Shares

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tax-Managed Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Vanguard

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W&R Advisors Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy New Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Capital Appreciation

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cundill Global Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  European Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Natural Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Large Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Limited-Term Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed European/Pacific

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed International Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Micro Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pacific Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real Estate Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

W A D D E L
L  &  R E E D  F I N A N C I A L, I N C.

Mutual Fund Management Fees by Fund Family

2010 Actual ($000)

 

Exhibit C-1

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  % Inc (Dec)

  	
   

  	
  Total

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  % of

  	
   

  	
  YTD Mgmt

  	
   

  	
  Variance

  	
   

  	
  2009

  	
   

  	
  Year

  	
   

  
	
   

  	
   

  	
  Jan

  	
   

  	
  Feb

  	
   

  	
  Mar

  	
   

  	
  Apr

  	
   

  	
  May

  	
   

  	
  Jun

  	
   

  	
  Jul

  	
   

  	
  Aug

  	
   

  	
  Sep

  	
   

  	
  Oct

  	
   

  	
  Nov

  	
   

  	
  Dec

  	
   

  	
  Y-T-D

  	
   

  	
  Total

  	
   

  	
  Fee Rate

  	
   

  	
  From L-Y

  	
   

  	
  Actual

  	
   

  	
  2009

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy VIP Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Natural Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Micro Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real Estate Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy VIP Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Grand Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fixed

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Daily Average

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

	
  Change in Mutual Fund Assets Under Management

  	
  July 2010

  	
   

  
	
  (Millions)

  	
  Month to Date

  	
  Exhibit C-1

  

 

	
   

  	
   

  	
  Net Assets

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Net

  	
   

  	
  Net

  	
   

  	
  Dividends

  	
   

  	
  Net Investment

  	
   

  	
  Dividends

  	
   

  	
  Valuation

  	
   

  	
  Net Assets

  	
   

  
	
   

  	
   

  	
  at 6-30-10

  	
   

  	
  Sales

  	
   

  	
  Redemptions

  	
   

  	
  Sales

  	
   

  	
  Exchanges

  	
   

  	
  Reinvested

  	
   

  	
  Income

  	
   

  	
  Paid

  	
   

  	
  Change

  	
   

  	
  at 7-31-10

  	
   

  
	
  Waddell & Reed Advisors
  Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Accumulative

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cont Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Investment

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Government Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  New Concepts

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tax-Managed Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Vanguard

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Allocation Pass-Thru (MAP/SPA)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal of Long -Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cash Management

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Waddell & Reed Advisors
  Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy New Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Capital Appreciation

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cundill Global Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  European Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Natural Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Large Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Limited-Term Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed European/Pacific

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed Int’l Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Microcap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pacific Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real Estate

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tax-Managed Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal of Long -Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal of Money Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less Eliminations- Underlying
  Funds of Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

	
  Change in Mutual Fund Assets Under Management

  	
  July 2010

  	
   

  
	
  (Millions)

  	
  Month to Date

  	
  Exhibit C-1

  

 

	
   

  	
   

  	
  Net Assets

  at 6-30-10

  	
   

  	
  Sales

  	
   

  	
  Redemptions

  	
   

  	
  Net

  Sales

  	
   

  	
  Net

  Exchanges

  	
   

  	
  Dividends

  Reinvested

  	
   

  	
  Net Investment

  Income

  	
   

  	
  Dividends

  Paid

  	
   

  	
  Valuation

  Change

  	
   

  	
  Net Assets

  at 7-31-10

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Conservative

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy VIP Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced Port

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Natural Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Inc

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Microcap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Mkt

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder- Agressive Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder- Conservative Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder- Moderate Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder- Moderately Agressive Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder- Moderately Conservative Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real Estate

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Port

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less Eliminations- Underlying
  Funds of Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy VIP Funds Total *

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Summary of All Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Long-Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Market Funds **

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less Eliminations- Underlying
  InvestEd Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  All Mutual Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

*All
Ivy VIP Funds are considered to be Long-Term Mutual Funds. For the Ivy VIP
Funds only sales include exchanges in and redemptions include exchanges out.

**Money
Market Funds consists of Advisors Cash Management and Invested Cash
Reserves, Ivy Money Market and Ivy Cash Reserves.

(1) Eliminations-
Underlying Funds of Funds — These eliminations are to prevent double counting
due to reporting both at the fund of fund and underlying fund levels.

 

	
  BY INVESTMENT MANAGER

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Sub-Advised Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W&R Managed Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  % BY INVESTMENT MANAGER

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Sub-Advised Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W&R Managed Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

	
  Change in Mutual Fund Assets Under Management

  	
  July 2010

  	
   

  
	
  (Millions)

  	
  Year to Date

  	
  Exhibit C-1

  

 

	
   

  	
   

  	
  Net Assets

  at 12-31-09

  	
   

  	
  Sales

  	
   

  	
  Redemptions

  	
   

  	
  Net

  Sales

  	
   

  	
  Net

  Exchanges

  	
   

  	
  Dividends

  Reinvested

  	
   

  	
  Net Investment

  Income

  	
   

  	
  Dividends

  Paid

  	
   

  	
  Valuation

  Change

  	
   

  	
  Net Assets

  at 7-31-2010

  	
   

  
	
  Waddell & Reed Advisors
  Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Accumulative

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cont Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Investment

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Government Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  New Concepts

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tax-Managed Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Vanguard

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Allocation Pass-Thru (MAP/SPA)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal of Long -Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cash Management

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Waddell & Reed Advisors
  Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy New Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Capital Appreciation

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cundill Global Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  European Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Natural Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Large Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Limited-Term Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed European/Pacific

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed Int’l Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Microcap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pacific Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real Estate

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tax-Managed Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal of Long -Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less Eliminations- Underlying
  Funds of Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

	
  Change in Mutual Fund Assets Under Management

  	
  July 2010

  	
   

  
	
  (Millions)

  	
  Year to Date

  	
  Exhibit C-1

  

 

	
   

  	
   

  	
  Net Assets

  at 12-31-09

  	
   

  	
  Sales

  	
   

  	
  Redemptions

  	
   

  	
  Net

  Sales

  	
   

  	
  Net

  Exchanges

  	
   

  	
  Dividends

  Reinvested

  	
   

  	
  Net Investment

  Income

  	
   

  	
  Dividends

  Paid

  	
   

  	
  Valuation

  Change

  	
   

  	
  Net Assets

  at 7-31-2010

  	
   

  
	
  InvestEd Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Conservative

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy VIP Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced Port

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Natural Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Inc

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Microcap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Mkt

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder- Agressive Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder- Conservative Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder- Moderate Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder- Moderately Agressive Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder- Moderately Conservative Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real Estate

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Port

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less Eliminations- Underlying
  Funds of Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy VIP Funds Total*

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Summary of All Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Long-Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Market Funds **

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less Eliminations- Underlying
  InvestEd Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  All Mutual Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

*All
Ivy VIP Funds are considered to be Long-Term Mutual Funds. For the Ivy Vip
Funds only sales include exchanges in and redemptions include exchanges out.

**Money
Market Funds consists of Advisors Cash Management and Invested Cash
Reserves, Ivy Money Market and Ivy Cash Reserves.

(1) Eliminations-
Underlying Funds of Funds — These eliminations are to prevent double counting
due to reporting both at the fund of fund and underlying fund levels.

 

	
  BY INVESTMENT MANAGER

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Sub-Advised Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W&R Managed Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  % BY INVESTMENT MANAGER

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Sub-Advised Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W&R Managed Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

	
   

  	
  Waddell & Reed Financial, Inc. -
  Consolidated

  	
  Exhibit C-2

  
	
   

  	
  Statement of Operations

  	
   

  
	
   

  	
  For the period indicated in each column heading

  	
   

  
	
   

  	
  Dollar amounts in thousands except per share amounts

  	
   

  

 

	
   

  	
   

  	
  QTD

  Aug-2010

  	
   

  	
  QTD

  May-2010

  	
   

  	
  Variance

  Dollars

  	
   

  	
  Variance

  Percent

  	
   

  	
  QTD

  Aug-2010

  	
   

  	
  QTD

  Aug-2009

  	
   

  	
  Variance

  Dollars

  	
   

  	
  Variance

  Percent

  	
   

  	
  YTD

  Aug-2010

  	
   

  	
  YTD

  Aug-2009

  	
   

  	
  Variance

  Dollars

  	
   

  	
  Variance

  Percent

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  REVENUES:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Investment Management Fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Underwriting & Distribution fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Shareholder Service Fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Revenue Allocation

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL REVENUE

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

	
   

  	
   

  	
  Aug-2009

  	
   

  	
  Sep-2009

  	
   

  	
  Oct-2009

  	
   

  	
  Nov-2009

  	
   

  	
  Dec-2009

  	
   

  	
  Jan-2010

  	
   

  	
  Feb-2010

  	
   

  	
  Mar-2010

  	
   

  	
  Apr-2010

  	
   

  	
  May-2010

  	
   

  	
  Jun-2010

  	
   

  	
  Jul-2010

  	
   

  	
  Aug-2010

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  REVENUES:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Investment Management Fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Underwriting & Distribution fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Shareholder Service Fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Revenue Allocation

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL REVENUE

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

EXHIBIT D

 

FORM OF
REVOLVING BORROWING REQUEST

 

Date:                            ,
         

 

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

 

Ladies and Gentlemen:

 

Reference is made to that certain
Credit Agreement, dated as of August 31, 2010 (as amended, restated,
extended, supplemented or otherwise modified in writing from time to time, the “Agreement;”
the terms defined therein being used herein as therein defined), among Waddell &
Reed Financial, Inc. (the “Borrower”), the several financial institutions
from time to time party thereto (collectively, the “Lenders” and each
individually, a “Lender”), and Bank of America, N.A., as administrative
agent for the Lenders (in such capacity, together with any successors thereto
in such capacity, the “Administrative Agent”).

 

The undersigned hereby requests
(select one):

 

o 
A Borrowing of Loans

 

o 
A conversion or continuation of Loans

 

1.                                       On                                                                          
(a Business Day).

 

2.                                       In the amount of $

 

3.                                       Comprised of                                                                            

[Type of Loan requested/converted/continued]

 

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

 

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

 

 

 

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

 

D-1

 

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

 

	
   

  	
  WADDELL & REED
  FINANCIAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

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

 

D-2

 

EXHIBIT E

 

FORM OF
COMPLIANCE CERTIFICATE

 

Financial Statement
Date:                       ,
        

 

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

 

Ladies and Gentlemen:

 

Reference is made to that certain
Credit Agreement, dated as of August 31, 2010 (as amended, restated,
extended, supplemented or otherwise modified in writing from time to time, the “Agreement;”
the terms defined therein being used herein as therein defined), among Waddell &
Reed Financial, Inc. (the “Borrower”), the several financial
institutions from time to time party thereto (collectively, the “Lenders”
and each individually, a “Lender”), and Bank of America, N.A., as
administrative agent for the Lenders (in such capacity, together with any
successors thereto in such capacity, the “Administrative Agent”).

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

[select
one:]

 

(12) 
Must be a Financial Officer.

 

E-1

 

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

 

—or—

 

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

 

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

 

[select one:]

 

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

 

—or—

 

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

 

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

 

[Remainder of Page Left Intentionally Blank]

 

E-2

 

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

 

	
   

  	
  WADDELL & REED
  FINANCIAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

E-3

 

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

 

SCHEDULE 1

to the Compliance Certificate

($ in 000’s)

 

	
  I.

  	
   

  	
  Section 6.01(a) —
  Consolidated Leverage Ratio.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  A.

  	
   

  	
  Consolidated Total Debt at
  Statement Date

  	
   

  	
  $             

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  B.

  	
   

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

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  1.

  	
   

  	
  Consolidated Net Income for
  Subject Period:

  	
   

  	
  $             

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  2.

  	
   

  	
  Income tax expense for Subject
  Period:

  	
   

  	
  $             

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  3.

  	
   

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

  	
   

  	
  $             

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  4.

  	
   

  	
  Depreciation and amortization
  expenses for Subject Period:

  	
   

  	
  $             

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  5.

  	
   

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

  	
   

  	
  $             

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  6.

  	
   

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

  	
   

  	
  $             (13)

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  7.

  	
   

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

  	
   

  	
  $             

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  8.

  	
   

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

  	
   

  	
  $             

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  C.

  	
   

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

  	
   

  	
           
  to 1

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Must not equal or exceed a
  ratio of 3.0 to 1.0

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  In Compliance: Yes / No

  	
   

  	
   

  

 

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

 

E-4

 

	
  II.

  	
   

  	
  Section 6.01(b) —
  Consolidated Interest Coverage Ratio.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  A.

  	
   

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

  	
   

  	
  $             

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  B.

  	
   

  	
  Consolidated Interest Expense for
  Subject Period:

  	
   

  	
  $             

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  C.

  	
   

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

  	
   

  	
           
  to 1

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

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

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  In Compliance: Yes / No

  	
   

  	
   

  

 

E-5Exhibit 10.2

 

EXECUTION VERSION

	
   

  	
   

  

 

WADDELL & REED FINANCIAL, INC.

 

$190,000,000

 

5.00% Senior Notes, Series A, due 2018

5.75% Senior Notes, Series B, due 2021

 

 

NOTE PURCHASE AGREEMENT

 

 

Dated as of August 31, 2010

 

	
   

  	
   

  

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 1.

  	
  AUTHORIZATION OF NOTES

  	
   

  	
  1

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 2.

  	
  SALE AND PURCHASE OF NOTES

  	
   

  	
  1

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 3.

  	
  CLOSING

  	
   

  	
  2

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 4.

  	
  CONDITIONS TO CLOSING

  	
   

  	
  2

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 4.1.

  	
  Representations and Warranties

  	
   

  	
  2

  
	
  Section 4.2.

  	
  Performance; No Default

  	
   

  	
  2

  
	
  Section 4.3.

  	
  Compliance Certificates

  	
   

  	
  2

  
	
  Section 4.4.

  	
  Opinions of Counsel

  	
   

  	
  3

  
	
  Section 4.5.

  	
  Purchase Permitted By Applicable
  Law, Etc.

  	
   

  	
  3

  
	
  Section 4.6.

  	
  Sale of Other Notes

  	
   

  	
  3

  
	
  Section 4.7.

  	
  Payment of Special Counsel Fees

  	
   

  	
  3

  
	
  Section 4.8.

  	
  Private Placement Numbers

  	
   

  	
  3

  
	
  Section 4.9.

  	
  Changes in Corporate Structure

  	
   

  	
  4

  
	
  Section 4.10.

  	
  Funding Instructions

  	
   

  	
  4

  
	
  Section 4.11.

  	
  Proceedings and Documents

  	
   

  	
  4

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 5.

  	
  REPRESENTATIONS AND WARRANTIES OF THE COMPANY

  	
   

  	
  4

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 5.1.

  	
  Organization; Power and Authority

  	
   

  	
  4

  
	
  Section 5.2.

  	
  Authorization, Etc.

  	
   

  	
  4

  
	
  Section 5.3.

  	
  Disclosure

  	
   

  	
  4

  
	
  Section 5.4.

  	
  Organization and Ownership of
  Shares of Subsidiaries

  	
   

  	
  5

  
	
  Section 5.5.

  	
  Financial Statements; Material
  Liabilities

  	
   

  	
  5

  
	
  Section 5.6.

  	
  Compliance with Laws, Other
  Instruments, Etc.

  	
   

  	
  6

  
	
  Section 5.7.

  	
  Governmental Authorizations, Etc.

  	
   

  	
  6

  
	
  Section 5.8.

  	
  Litigation; Observance of
  Agreements, Statutes and Orders

  	
   

  	
  6

  
	
  Section 5.9.

  	
  Taxes

  	
   

  	
  6

  
	
  Section 5.10.

  	
  Title to Property; Leases

  	
   

  	
  7

  
	
  Section 5.11.

  	
  Licenses, Permits, Etc.

  	
   

  	
  7

  
	
  Section 5.12.

  	
  Compliance with ERISA

  	
   

  	
  7

  
	
  Section 5.13.

  	
  Private Offering by the Company

  	
   

  	
  8

  
	
  Section 5.14.

  	
  Use of Proceeds; Margin
  Regulations

  	
   

  	
  8

  
	
  Section 5.15.

  	
  Existing Indebtedness; Future
  Liens

  	
   

  	
  9

  
	
  Section 5.16.

  	
  Foreign Assets Control
  Regulations, Etc.

  	
   

  	
  9

  
	
  Section 5.17.

  	
  Status under Certain Statutes

  	
   

  	
  10

  
	
  Section 5.18.

  	
  Environmental Matters

  	
   

  	
  10

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 6.

  	
  REPRESENTATIONS OF THE PURCHASERS

  	
   

  	
  11

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 6.1.

  	
  Purchase for Investment

  	
   

  	
  11

  
	
  Section 6.2.

  	
  Source of Funds

  	
   

  	
  11

  

 

i

 

TABLE OF
CONTENTS

(continued)

 

	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 7.

  	
  INFORMATION AS TO COMPANY

  	
   

  	
  12

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 7.1.

  	
  Financial and Business
  Information

  	
   

  	
  12

  
	
  Section 7.2.

  	
  Officer’s Certificate

  	
   

  	
  15

  
	
  Section 7.3.

  	
  Visitation

  	
   

  	
  16

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 8.

  	
  PAYMENT AND PREPAYMENT OF THE NOTES

  	
   

  	
  17

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 8.1.

  	
  Maturity

  	
   

  	
  17

  
	
  Section 8.2.

  	
  Optional Prepayments with
  Make-Whole Amount

  	
   

  	
  17

  
	
  Section 8.3.

  	
  Prepayment in Connection with a
  Change of Control

  	
   

  	
  17

  
	
  Section 8.4.

  	
  Allocation of Partial Prepayments

  	
   

  	
  19

  
	
  Section 8.5.

  	
  Maturity; Surrender, Etc.

  	
   

  	
  19

  
	
  Section 8.6.

  	
  Purchase of Notes

  	
   

  	
  19

  
	
  Section 8.7.

  	
  Make-Whole Amount

  	
   

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 9.

  	
  AFFIRMATIVE COVENANTS

  	
   

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 9.1.

  	
  Compliance with Law

  	
   

  	
  21

  
	
  Section 9.2.

  	
  Insurance

  	
   

  	
  21

  
	
  Section 9.3.

  	
  Maintenance of Properties

  	
   

  	
  21

  
	
  Section 9.4.

  	
  Payment of Taxes and Claims

  	
   

  	
  21

  
	
  Section 9.5.

  	
  Corporate Existence, Etc.

  	
   

  	
  22

  
	
  Section 9.6.

  	
  Books and Records

  	
   

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 10.

  	
  NEGATIVE COVENANTS

  	
   

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 10.1.

  	
  Maintenance of Financial
  Conditions

  	
   

  	
  22

  
	
  Section 10.2.

  	
  Subsidiary Indebtedness, Etc.

  	
   

  	
  22

  
	
  Section 10.3.

  	
  Liens

  	
   

  	
  23

  
	
  Section 10.4.

  	
  Transactions with Affiliates

  	
   

  	
  24

  
	
  Section 10.5.

  	
  Merger, Consolidation, Etc.

  	
   

  	
  25

  
	
  Section 10.6.

  	
  Sales and Leasebacks

  	
   

  	
  25

  
	
  Section 10.7.

  	
  Hedging Agreements

  	
   

  	
  26

  
	
  Section 10.8.

  	
  Restricted Payments

  	
   

  	
  26

  
	
  Section 10.9.

  	
  Line of Business

  	
   

  	
  26

  
	
  Section 10.10.

  	
  Terrorism Sanctions Regulations

  	
   

  	
  26

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 11.

  	
  EVENTS OF DEFAULT

  	
   

  	
  26

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 12.

  	
  REMEDIES ON DEFAULT, ETC.

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 12.1.

  	
  Acceleration

  	
   

  	
  28

  
	
  Section 12.2.

  	
  Other Remedies

  	
   

  	
  29

  
	
  Section 12.3.

  	
  Rescission

  	
   

  	
  29

  
	
  Section 12.4.

  	
  No Waivers or Election of
  Remedies, Expenses, Etc.

  	
   

  	
  29

  

 

ii

 

TABLE OF
CONTENTS

(continued)

 

	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 13.

  	
  REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 13.1.

  	
  Registration of Notes

  	
   

  	
  30

  
	
  Section 13.2.

  	
  Transfer and Exchange of Notes

  	
   

  	
  30

  
	
  Section 13.3.

  	
  Replacement of Notes

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 14.

  	
  PAYMENTS ON NOTES

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 14.1.

  	
  Place of Payment

  	
   

  	
  31

  
	
  Section 14.2.

  	
  Home Office Payment

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 15.

  	
  EXPENSES, ETC.

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 15.1.

  	
  Transaction Expenses

  	
   

  	
  31

  
	
  Section 15.2.

  	
  Survival

  	
   

  	
  32

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 16.

  	
  SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE
  AGREEMENT

  	
   

  	
  32

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 17.

  	
  AMENDMENT AND WAIVER

  	
   

  	
  32

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 17.1.

  	
  Requirements

  	
   

  	
  32

  
	
  Section 17.2.

  	
  Solicitation of Holders of Notes

  	
   

  	
  33

  
	
  Section 17.3.

  	
  Binding Effect, etc.

  	
   

  	
  33

  
	
  Section 17.4.

  	
  Notes Held by Company, etc.

  	
   

  	
  33

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 18.

  	
  NOTICES

  	
   

  	
  33

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 19.

  	
  REPRODUCTION OF DOCUMENTS

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 20.

  	
  CONFIDENTIAL INFORMATION

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 21.

  	
  SUBSTITUTION OF PURCHASER

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 22.

  	
  MISCELLANEOUS

  	
   

  	
  36

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 22.1.

  	
  Successors and Assigns

  	
   

  	
  36

  
	
  Section 22.2.

  	
  Payments Due on Non-Business Days

  	
   

  	
  36

  
	
  Section 22.3.

  	
  Accounting Terms; Changes in GAAP

  	
   

  	
  36

  
	
  Section 22.4.

  	
  Severability

  	
   

  	
  36

  
	
  Section 22.5.

  	
  Construction, etc.

  	
   

  	
  37

  
	
  Section 22.6.

  	
  Counterparts

  	
   

  	
  37

  
	
  Section 22.7.

  	
  Governing Law

  	
   

  	
  37

  
	
  Section 22.8.

  	
  Jurisdiction and Process; Waiver
  of Jury Trial

  	
   

  	
  37

  

 

iii

 

	
  SCHEDULE
  A

  	
  —

  	
  INFORMATION
  RELATING TO PURCHASERS

  
	
   

  	
   

  	
   

  
	
  SCHEDULE
  B

  	
  —

  	
  DEFINED
  TERMS

  
	
   

  	
   

  	
   

  
	
  SCHEDULE
  5.3

  	
  —

  	
  Disclosure
  Materials

  
	
   

  	
   

  	
   

  
	
  SCHEDULE
  5.4

  	
  —

  	
  Subsidiaries
  of the Company and Ownership of Subsidiary Stock

  
	
   

  	
   

  	
   

  
	
  SCHEDULE
  5.5

  	
  —

  	
  Financial
  Statements

  
	
   

  	
   

  	
   

  
	
  SCHEDULE
  5.8

  	
  —

  	
  Litigation

  
	
   

  	
   

  	
   

  
	
  SCHEDULE
  5.15

  	
  —

  	
  Existing
  Indebtedness

  
	
   

  	
   

  	
   

  
	
  SCHEDULE
  10.2

  	
  —

  	
  Existing
  Subsidiary Indebtedness

  
	
   

  	
   

  	
   

  
	
  SCHEDULE
  10.3

  	
  —

  	
  Existing
  Liens

  
	
   

  	
   

  	
   

  
	
  SCHEDULE
  10.6

  	
  —

  	
  Sale/Leaseback
  Properties

  
	
   

  	
   

  	
   

  
	
  EXHIBIT 1(a)

  	
  —

  	
  Form of
  5.00% Senior Note, Series A, due 2018

  
	
   

  	
   

  	
   

  
	
  EXHIBIT 1(b)

  	
  —

  	
  Form of
  5.75% Senior Note, Series B, due 2021

  
	
   

  	
   

  	
   

  
	
  EXHIBIT 4.4(a)(i)

  	
  —

  	
  Form of
  Signing Date Opinion of Special Counsel for the Company

  
	
   

  	
   

  	
   

  
	
  EXHIBIT 4.4(a)(ii)

  	
  —

  	
  Form of
  Closing Opinion of Special Counsel for the Company

  
	
   

  	
   

  	
   

  
	
  EXHIBIT 4.4(b)(i)

  	
  —

  	
  Form of
  Signing Date Opinion of Internal Counsel to the Company

  
	
   

  	
   

  	
   

  
	
  EXHIBIT 4.4(b)(ii)

  	
  —

  	
  Form of
  Closing Opinion of Internal Counsel to the Company

  
	
   

  	
   

  	
   

  
	
  EXHIBIT 4.4(c)(i)

  	
  —

  	
  Form of
  Signing Date Opinion of Special Counsel for the Purchasers

  
	
   

  	
   

  	
   

  
	
  EXHIBIT 4.4(c)(ii)

  	
  —

  	
  Form of
  Closing Opinion of Special Counsel for the Purchasers

  
	
   

  	
   

  	
   

  
	
  EXHIBIT 7.1(f)(i)

  	
  —

  	
  Form of
  Report on Net Asset Values

  
	
   

  	
   

  	
   

  
	
  EXHIBIT 7.1(f)(ii)

  	
  —

  	
  Form of
  Report on Aggregate Revenue Base

  

 

i

 

WADDELL & REED FINANCIAL, INC.

6300 Lamar Avenue

Overland Park, Kansas 66202

 

	
   

  	
  Re:

  	
  5.00%
  Senior Notes, Series A, due 2018

  
	
   

  	
   

  	
  5.75%
  Senior Notes, Series B, due 2021

  

 

As of August 31, 2010

 

TO EACH OF THE PURCHASERS LISTED IN

SCHEDULE A HERETO:

 

Ladies
and Gentlemen:

 

Waddell &
Reed Financial, Inc., a Delaware corporation (the “Company”),
agrees with each of the purchasers whose names appear at the end hereof (each,
a “Purchaser” and, collectively, the “Purchasers”) as follows:

 

SECTION 1.                                                                            AUTHORIZATION OF NOTES.

 

The
Company has duly authorized the issue and sale of $190,000,000 aggregate
principal amount of its senior notes in two series, of which $95,000,000
aggregate principal amount shall be its 5.00% Senior Notes, Series A, due
2018 (the “Series A Notes,” such term to
include any such notes issued in substitution therefor pursuant to Section 13)
and $95,000,000 aggregate principal amount shall be its 5.75% Senior Notes, Series B,
due 2021 (the “Series B Notes,” such term to
include any such notes issued in substitution therefor pursuant to Section 13,
and, together with the Series A Notes, the “Notes”).  The Notes shall be substantially in the
respective forms set out in Exhibits 1(a) and 1(b).  The terms “Note,”
“Series A Note” and “Series B Note” mean one of the Notes, one of the Series A
Notes and one of the Series B Notes, respectively.  Certain capitalized and other terms used in
this Note Purchase Agreement (this “Agreement”) are
defined in Schedule B and references to a “Schedule” or an “Exhibit” are,
unless otherwise specified, to a Schedule or an Exhibit attached to this
Agreement.

 

SECTION 2.                                                                            SALE AND PURCHASE OF NOTES.

 

Subject
to the terms and conditions of this Agreement, the Company will issue and sell
to each Purchaser and each Purchaser will purchase from the Company, at the
Closing provided for in Section 3, Notes of the series and in the
principal amount specified opposite such Purchaser’s name in Schedule A at the
purchase price of 100% of the principal amount thereof.  The Purchasers’ obligations hereunder are
several and not joint obligations and no Purchaser shall have any liability to
any Person for the performance or non-performance of any obligation by any
other Purchaser hereunder.

 

 

SECTION 3.                                                                            CLOSING.

 

The
sale and purchase of the Notes to be purchased by each Purchaser shall occur at
the offices of Willkie Farr & Gallagher LLP, 787 Seventh Avenue, New
York, New York 10019, at 10:00 a.m., New York City time, at a closing (the
“Closing”) on January 13, 2011 or
on such other Business Day thereafter on or prior to January 15, 2011 as
may be agreed upon by the Company and the Purchasers.  At the Closing the Company will deliver to
each Purchaser the Notes to be purchased by such Purchaser in the form of a
single Note of each series to be purchased by such Purchaser (or such greater
number of Notes in denominations of at least $1,000,000 or integral multiples
of $500,000 in excess thereof as such Purchaser may request) dated the date of
the Closing and registered in such Purchaser’s name (or in the name of its
nominee), against delivery by such Purchaser to the Company or its order of
immediately available funds in the amount of the purchase price therefor by
wire transfer of immediately available funds for the account of the Company as
set forth in the letter delivered pursuant to Section 4.10 hereof.

 

If
at the Closing the Company shall fail to tender such Notes to any Purchaser as
provided above in this Section 3, or any of the conditions specified in Section 4
shall not have been fulfilled to such Purchaser’s satisfaction, such Purchaser
shall, at its election, be relieved of all further obligations under this
Agreement, without thereby waiving any rights such Purchaser may have by reason
of such failure or such nonfulfillment.

 

SECTION 4.                                                                            CONDITIONS TO CLOSING.

 

Each
Purchaser’s obligation to purchase and pay for the Notes to be sold to such
Purchaser at the Closing is subject to the fulfillment to such Purchaser’s
satisfaction, prior to or at the Closing, of the following conditions:

 

Section 4.1.                                                Representations and Warranties.  The
representations and warranties of the Company in this Agreement shall be
correct when made and at the time of the Closing.

 

Section 4.2.                                                Performance; No Default.  The
Company shall have performed and complied with all agreements and conditions
contained in this Agreement required to be performed or complied with by it
prior to or at the date of this Agreement and prior to or at the date of the
Closing and immediately prior to and after giving effect to the issue and sale
of the Notes (and the application of the proceeds thereof as contemplated by Section 5.14)
no Default or Event of Default shall have occurred and be continuing.  Neither the Company nor any Subsidiary shall
have entered into any transaction since July 23, 2010 that would have been
prohibited by Sections 10.1 through 10.8, inclusive, had such Sections applied
since such date.  No Change of Control
shall have occurred or be contemplated.

 

Section 4.3.                                                Compliance Certificates.

 

(a)                                  Officer’s Certificate.  The Company shall have delivered
to such Purchaser an Officer’s Certificate, dated the date of this Agreement
and the date of the Closing, respectively, certifying that the conditions
specified in Sections 4.1, 4.2 and 4.9 have been fulfilled as of such date.

 

2

 

(b)                                 Secretary’s Certificate.  The Company shall have delivered
to such Purchaser a certificate of its Secretary or Assistant Secretary, dated
the date of this Agreement and the date of the Closing, respectively,
certifying as to the resolutions attached thereto and other corporate
proceedings relating to the authorization, execution and delivery of the Notes
and this Agreement or the absence of changes to such resolutions and other
corporate proceedings, if the same were previously certified to pursuant to
this Section 4.3(b).

 

Section 4.4.                                                Opinions of Counsel.  Such
Purchaser shall have received opinions in form and substance satisfactory to
such Purchaser, dated the date of this Agreement and the date of the Closing,
respectively, (a) from Fulbright & Jaworski L.L.P., counsel for
the Company, substantially in the form of Exhibits 4.4(a)(i) and
4.4(a)(ii), respectively, and covering such other matters incident to the
transactions contemplated hereby as such Purchaser or its counsel may
reasonably request (and the Company hereby instructs its counsel to deliver
such opinion to the Purchasers), (b) from internal counsel to the Company,
substantially in the form of Exhibits 4.4(b)(i) and 4.4(b)(ii),
respectively, and covering such other matters incident to the transactions
contemplated hereby as such Purchaser or its counsel may reasonably request,
and (c) from Willkie Farr & Gallagher LLP, the Purchasers’
special counsel in connection with such transactions, substantially in the form
set forth in Exhibit 4.4(c)(i) and 4.4(c)(ii), respectively, and
covering such other matters incident to such transactions as such Purchaser may
reasonably request.

 

Section 4.5.                                                Purchase Permitted By Applicable Law, Etc.  On
the date of the Closing such Purchaser’s purchase of Notes shall (a) be
permitted by the laws and regulations of each jurisdiction to which such
Purchaser is subject, without recourse to provisions (such as section 1405(a)(8) of
the New York Insurance Law) permitting limited investments by insurance
companies without restriction as to the character of the particular investment,
(b) not violate any applicable law or regulation (including, without
limitation, Regulation T, U or X of the Board of Governors of the Federal
Reserve System) and (c) not subject such Purchaser to any tax, penalty or
liability under or pursuant to any applicable law or regulation, which law or
regulation was not in effect on the date hereof.  If requested by such Purchaser, such
Purchaser shall have received an Officer’s Certificate certifying as to such
matters of fact as such Purchaser may reasonably specify to enable such
Purchaser to determine whether such purchase is so permitted.

 

Section 4.6.                                                Sale of Other Notes. 
Contemporaneously with the Closing the Company shall sell to each other
Purchaser and each other Purchaser shall purchase the Notes to be purchased by
it at the Closing as specified in Schedule A.

 

Section 4.7.                                                Payment of Special Counsel Fees. 
Without limiting the provisions of Section 15.1, the Company shall
have paid on or before the date of this Agreement and the date of the Closing,
respectively, the fees, charges and disbursements of the Purchasers’ special
counsel referred to in Section 4.4 to the extent reflected in a statement
of such counsel rendered to the Company at least one Business Day prior to the
date of this Agreement and the date of the Closing, as applicable.

 

Section 4.8.                                                Private Placement Numbers.  A
Private Placement Number issued by Standard & Poor’s CUSIP Service
Bureau (in cooperation with the SVO) shall have been obtained for the Notes of
each series.

 

3

 

Section 4.9.                                                Changes in Corporate Structure.  The
Company shall not have changed its jurisdiction of incorporation or
organization, as applicable, or been a party to any merger or consolidation or
succeeded to all or any substantial part of the liabilities of any other
entity, at any time following June 30, 2010.

 

Section 4.10.                                         Funding Instructions.  At
least three Business Days prior to the date of the Closing, each Purchaser
shall have received written instructions signed by a Responsible Officer on
letterhead of the Company setting out the information contemplated by Section 3,
including (a) the name and address of the Company’s bank, (b) such
bank’s ABA number, (c) the account name and number into which the purchase
price for the Notes is to be deposited and (d) the name and telephone
number of a contact person at such bank.

 

Section 4.11.                                         Proceedings and Documents.  All
corporate and other proceedings in connection with the transactions
contemplated by this Agreement and all documents and instruments incident to
such transactions shall be satisfactory to such Purchaser and its special
counsel, and such Purchaser and its special counsel shall have received all
such counterpart originals or certified or other copies of such documents as
such Purchaser or such special counsel may reasonably request.

 

SECTION 5.                                                                            REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

 

The
Company represents and warrants to each Purchaser on and as of the date of this
Agreement and on and as of the date of the Closing that:

 

Section 5.1.                                                Organization; Power and Authority.  The
Company is a corporation duly organized, validly existing and in good standing
under the laws of its jurisdiction of incorporation, and is duly qualified as a
foreign corporation and is in good standing in each jurisdiction in which such
qualification is required by law, other than those jurisdictions as to which
the failure to be so qualified or in good standing could not, individually or
in the aggregate, reasonably be expected to have a Material Adverse
Effect.  The Company has the corporate
power and authority to own or hold under lease the properties it purports to
own or hold under lease, to transact the business it transacts and proposes to
transact, to execute and deliver this Agreement and the Notes and to perform
the provisions hereof and thereof.

 

Section 5.2.                                                Authorization, Etc.  This
Agreement and the Notes have been duly authorized by all necessary corporate
action on the part of the Company, and this Agreement constitutes, and upon
execution and delivery thereof each Note will constitute, a legal, valid and
binding obligation of the Company enforceable against the Company in accordance
with its terms, except as such enforceability may be limited by
(i) applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the enforcement of creditors’ rights generally and
(ii) general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).

 

Section 5.3.                                                Disclosure.  The
Company, through its agents, Bank of America Merrill Lynch and Wells Fargo &
Co., has delivered to each Purchaser a copy of a Private Placement Memorandum,
dated July 2010 (the “Memorandum”),
relating to the transactions contemplated hereby.  The Memorandum fairly describes, in all
material respects, the general nature of the 

 

4

 

business
of the Company and its Subsidiaries. 
This Agreement, the Memorandum and the documents, certificates or other
writings delivered to the Purchasers by or on behalf of the Company in
connection with the transactions contemplated hereby and identified in Schedule
5.3 (collectively, as the “Disclosure
Documents”), and the financial statements listed in Schedule 5.5,
taken as a whole, do not contain any untrue statement of a material fact or
omit to state any material fact necessary to make the statements therein not
misleading in light of the circumstances under which they were made.  Except as disclosed in the Disclosure
Documents or the financial statements listed in Schedule 5.5 as of the date of this
Agreement, since December 31, 2009, there has been no change in the
financial condition, operations, business, properties or prospects of the
Company or any Subsidiary except changes that individually or in the aggregate
could not reasonably be expected to have a Material Adverse Effect.  There is no fact known to the Company that
could reasonably be expected to have a Material Adverse Effect that has not
been set forth herein or in the Disclosure Documents.

 

Section 5.4.                                                Organization and Ownership of Shares of
Subsidiaries.  (a)  Schedule 5.4 contains (except as
noted therein or as updated prior to the Closing) complete and correct lists
(i) of the Company’s Subsidiaries, showing, as to each Subsidiary, the
correct name thereof, the jurisdiction of its organization, and the percentage
of shares of each class of its capital stock or similar equity interests
outstanding owned by the Company and each other Subsidiary, and (ii) of
the Company’s directors and senior officers.

 

(b)                                 All of the outstanding shares of capital stock or similar equity
interests of each Subsidiary shown in Schedule 5.4 as being owned by the
Company and its Subsidiaries have been validly issued, are fully paid and
nonassessable and are owned by the Company or another Subsidiary free and clear
of any Lien (except as otherwise disclosed in Schedule 5.4 as of the date of
this Agreement).

 

(c)                                  Each Subsidiary identified in Schedule 5.4 is a corporation or other
legal entity duly organized, validly existing and in good standing under the laws
of its jurisdiction of organization, and is duly qualified as a foreign
corporation or other legal entity and is in good standing in each jurisdiction
in which such qualification is required by law, other than those jurisdictions
as to which the failure to be so qualified or in good standing could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.  Each such Subsidiary has
the corporate, limited liability company or other similar power and authority
to own or hold under lease the properties it purports to own or hold under
lease and to transact the business it transacts and proposes to transact.

 

(d)                                 No Subsidiary is a party to, or otherwise subject to any legal,
regulatory, contractual or other restriction (other than this Agreement, the
agreements listed on Schedule 5.4 as of the date of this Agreement and
customary limitations imposed by regulation, corporate law or similar statutes)
restricting the ability of such Subsidiary to pay dividends out of profits or
make any other similar distributions of profits to the Company or any of its
Subsidiaries that owns outstanding shares of capital stock or similar equity
interests of such Subsidiary.

 

Section 5.5.                                                Financial Statements; Material Liabilities.  The
Company has delivered to each Purchaser copies of the consolidated and
consolidating financial statements of the Company listed on Schedule 5.5 (as
updated prior to the Closing).  All of
said financial

 

5

 

statements
(including in each case the related schedules and notes) fairly present in all
material respects the consolidated financial position of the Company and its
Subsidiaries as of the respective dates specified in such Schedule and the
consolidated results of their operations and cash flows for the respective
periods so specified and have been prepared in accordance with GAAP
consistently applied throughout the periods involved except as set forth in the
notes thereto (subject, in the case of any interim financial statements, to
normal year-end adjustments).  The
Company and its Subsidiaries do not have any Material liabilities that are not
disclosed on such financial statements or otherwise disclosed in the Disclosure
Documents or the financial statements of the Company listed on Schedule 5.5 as
of the date of this Agreement.

 

Section 5.6.                                                Compliance with Laws, Other Instruments, Etc.  The
execution, delivery and performance by the Company of this Agreement and the
Notes will not (i) contravene, result in any breach of, or constitute a
default under, or result in the creation of any Lien in respect of any property
of the Company or any Subsidiary under, any indenture, mortgage, deed of trust,
loan, purchase or credit agreement, lease, corporate charter or by-laws, or any
other agreement or instrument to which the Company or any Subsidiary is bound
or by which the Company or any Subsidiary or any of their respective properties
may be bound or affected, (ii) conflict with or result in a breach of any
of the terms, conditions or provisions of any order, judgment, decree, or
ruling of any court, arbitrator or Governmental Authority applicable to the
Company or any Subsidiary or (iii) violate any provision of any statute or
other rule or regulation of any Governmental Authority applicable to the
Company or any Subsidiary.

 

Section 5.7.                                                Governmental Authorizations, Etc.  No
consent, approval or authorization of, or registration, filing or declaration
with, any Governmental Authority is required in connection with the execution,
delivery or performance by the Company of this Agreement or the Notes.

 

Section 5.8.                                                Litigation; Observance of Agreements, Statutes
and Orders.  (a)  Except as described on Schedule 5.8
as of the date of this Agreement, there are no actions, suits, investigations
or proceedings pending or, to the knowledge of the Company, threatened against
or affecting the Company or any Subsidiary or any property of the Company or
any Subsidiary in any court or before any arbitrator of any kind or before or
by any Governmental Authority that, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.

 

(b)                                 Neither the Company nor any Subsidiary is in default under any term of
any agreement or instrument to which it is a party or by which it is bound, or
any order, judgment, decree or ruling of any court, arbitrator or Governmental
Authority or is in violation of any applicable law, ordinance, rule or
regulation (including without limitation Environmental Laws or the USA Patriot
Act) of any Governmental Authority, which default or violation, individually or
in the aggregate, could reasonably be expected to have a Material Adverse
Effect.

 

Section 5.9.                                                Taxes.  The
Company and its Subsidiaries have filed all tax returns that are required to
have been filed in any jurisdiction, and have paid all taxes shown to be due
and payable on such returns and all other taxes and assessments levied upon
them or their properties, assets, income or franchises, to the extent such
taxes and assessments have become due and payable and before they have become
delinquent, except for any taxes and assessments (i) the amount of which
is not individually or in the aggregate Material or (ii) the amount,
applicability 

 

6

 

or
validity of which is currently being contested in good faith by appropriate
proceedings and with respect to which the Company or a Subsidiary, as the case
may be, has established adequate reserves in accordance with GAAP.  The Company knows of no basis for any other
tax or assessment that could reasonably be expected to have a Material Adverse
Effect.  The charges, accruals and
reserves on the books of the Company and its Subsidiaries in respect of
Federal, state or other taxes for all fiscal periods are adequate.  The Federal income tax liabilities of the
Company and its Subsidiaries have been finally determined (whether by reason of
completed audits or the statute of limitations having run) for all fiscal years
up to and including the fiscal year ended 2004 and paid for all fiscal years up
to and including the fiscal year ended 2009.

 

Section 5.10.                                         Title to Property; Leases.  The
Company and its Subsidiaries have good and sufficient title to their respective
properties that are Material, including all such properties reflected in the
most recent audited balance sheet referred to in Section 5.5 or purported
to have been acquired by the Company or any Subsidiary after said date (except
as sold or otherwise disposed of in the ordinary course of business), in each
case free and clear of Liens prohibited by this Agreement.  All leases that are Material are valid and
subsisting and are in full force and effect in all material respects.

 

Section 5.11.                                         Licenses, Permits, Etc.  (a) 
The Company and its Subsidiaries own or possess all licenses, permits,
franchises, authorizations, patents, copyrights, proprietary software, service
marks, trademarks and trade names, or rights thereto, that individually or in
the aggregate are Material, without conflict with the rights of others to the
actual knowledge of the Responsible Officers after due internal inquiry.

 

(b)                                 To the actual knowledge of the Responsible Officers after due internal
inquiry, no product of the Company or any of its Subsidiaries infringes in any
material respect any license, permit, franchise, authorization, patent,
copyright, proprietary software, service mark, trademark, trade name or other
right owned by any other Person.

 

(c)                                  To the actual knowledge of the Responsible Officers after due internal
inquiry, there is no Material violation by any Person of any right of the
Company or any of its Subsidiaries with respect to any patent, copyright,
proprietary software, service mark, trademark, trade name or other right owned
or used by the Company or any of its Subsidiaries.

 

Section 5.12.                                         Compliance with ERISA.  (a) 
The Company and each ERISA Affiliate have operated and administered each Plan
in compliance with all applicable laws except for such instances of
noncompliance as have not resulted in and could not reasonably be expected to
result in a Material Adverse Effect. 
Neither the Company nor any ERISA Affiliate has incurred any liability
pursuant to Title I or IV of ERISA or the penalty or excise tax provisions of
the Code relating to employee benefit plans (as defined in section 3(3) of
ERISA), and no event, transaction or condition has occurred or exists that
could reasonably be expected to result in the incurrence of any such liability
by the Company or any ERISA Affiliate, or in the imposition of any Lien on any
of the rights, properties or assets of the Company or any ERISA Affiliate, in
either case pursuant to Title I or IV of ERISA or to section 430(k) of the
Code, other than such liabilities or Liens as would not be individually or in
the aggregate Material.

 

7

 

(b)                                 The present value of the aggregate benefit liabilities under each of the
Pension Plans, determined as of the end of such Pension Plan’s most recently
ended plan year on the basis of the actuarial assumptions specified for funding
purposes in such Pension Plan’s most recent actuarial valuation report, did not
exceed the aggregate current value of the assets of such Pension Plan allocable
to such benefit liabilities by more than $20,000,000 in the case of any single
Pension Plan.  The term “benefit liabilities” has the meaning
specified in section 4001 of ERISA and the terms “current value” and “present
value” have the meaning specified in section 3 of ERISA.

 

(c)                                  Neither the Company nor any ERISA Affiliate contributes to or is
obligated to contribute to any Multiemployer Plan.

 

(d)                                 The expected postretirement benefit obligation (determined as of the last
day of the Company’s most recently ended fiscal year in accordance with
Financial Accounting Standards Board ASC 715, without regard to liabilities
attributable to continuation coverage mandated by section 4980B of the Code) of
the Company and its Subsidiaries is not Material.

 

(e)                                  The execution and delivery of this Agreement and the issuance and sale of
the Notes at Closing hereunder will not involve any transaction that is subject
to the prohibitions of section 406 of ERISA or in connection with which a tax
or penalty could be imposed pursuant to section 502(i) of ERISA or section
4975(c)(1)(A)-(D) of the Code.  The
representation by the Company to each Purchaser in the first sentence of this Section 5.12(e) is
made in reliance upon and subject to the accuracy of such Purchaser’s
representation in Section 6.2 as to the sources of the funds used to pay
the purchase price of the Notes to be purchased by such Purchaser.

 

Section 5.13.                                         Private Offering by the Company. 
Neither the Company nor anyone acting on its behalf has offered the
Notes or any similar securities for sale to, or solicited any offer to buy any
of the Notes or any similar securities from, or otherwise approached or
negotiated in respect thereof with, any person other than the Purchasers and
not more than 50 other Institutional Investors, each of which has been offered
the Notes at a private sale for investment. 
Neither the Company nor anyone acting on its behalf has taken, or will
take, any action that would subject the issuance or sale of the Notes to the
registration requirements of Section 5 of the Securities Act or to the
registration requirements of any securities or blue sky laws of any applicable
jurisdiction.

 

Section 5.14.                                         Use of Proceeds; Margin Regulations.  The
Company will apply the proceeds of the sale of the Notes to repay existing
Indebtedness or for general corporate purposes or for both such purposes.  No part of the proceeds from the sale of the
Notes hereunder will be used, and no part of the proceeds of such Indebtedness
being repaid was used, directly or indirectly, for the purpose of buying or
carrying any margin stock within the meaning of Regulation U of the Board of
Governors of the Federal Reserve System (12 CFR 221), or for the purpose of
buying or carrying or trading in any securities under such circumstances as to
involve the Company in a violation of Regulation X of said Board (12 CFR 224)
or to involve any broker or dealer in a violation of Regulation T of said Board
(12 CFR 220).  Margin stock does not
constitute more than 25% of the value of the consolidated assets of the Company
and its Subsidiaries and the Company does not have any present intention that
margin stock will constitute more than 25% of the value of such assets.  As used in this Section, the terms “margin 

 

8

 

stock” and “purpose
of buying or carrying” shall have the meanings assigned to them in
said Regulation U.

 

Section 5.15.                                         Existing Indebtedness; Future Liens.  (a) 
Except as described therein, Schedule 5.15 sets forth a complete and correct
list of all outstanding Indebtedness of the Company and its Subsidiaries as of
the date of the most recent financial statements referred to in Schedule 5.5 as
of the date of this Agreement or as updated in writing prior to the date of the
Closing, as applicable (including a description of the obligors and obligees,
principal amount outstanding and collateral therefor, if any, and Guaranty
thereof, if any), since which date there has been no Material change in the
amounts, interest rates, sinking funds, installment payments or maturities of
the Indebtedness of the Company or its Subsidiaries.  Neither the Company nor any Subsidiary is in
default and no waiver of default is currently in effect, in the payment of any
principal or interest on any Indebtedness of the Company or such Subsidiary and
no event or condition exists with respect to any Indebtedness of the Company or
any Subsidiary that would permit (or that with notice or the lapse of time, or
both, would permit) one or more Persons to cause such Indebtedness to become
due and payable before its stated maturity or before its regularly scheduled
dates of payment.

 

(b)                                 Except as disclosed in Schedule 5.15 as of the date of this Agreement,
neither the Company nor any Subsidiary has agreed or consented to cause or
permit in the future (upon the happening of a contingency or otherwise) any of
its property, whether now owned or hereafter acquired, to be subject to a Lien
not permitted by Section 10.3.

 

(c)                                  Neither the Company nor any Subsidiary is a party to, or otherwise
subject to any provision contained in, any instrument evidencing Indebtedness
of the Company or such Subsidiary, any agreement relating thereto or any other
agreement (including, but not limited to, its charter or other organizational
document) which limits the amount of, or otherwise imposes restrictions on the
incurring of, Indebtedness of the Company, except as specifically
indicated in Schedule 5.15 as of date of this Agreement.

 

Section 5.16.                                         Foreign Assets Control Regulations, Etc.  (a) 
Neither the Company nor any Subsidiary is in violation of, none of the holders
of Notes solely as a result of purchasing, holding, receiving any payment or
exercising any rights in respect of, any Note, will be in violation of, and
neither the issuance and sale of the Notes by the Company nor its use of the
proceeds thereof as contemplated by this Agreement will violate, (i) the
Trading with the Enemy Act, as amended, the International Emergency Economic
Powers Act, as amended, or any executive orders, proclamations or regulations issued
pursuant thereto, or any of the foreign assets control regulations of the
United States Department of Treasury (31 C.F.R., Subtitle B, Chapter V, as
amended) or any enabling legislation or executive order relating thereto, or
(ii) the USA Patriot Act.

 

(b)                                 Neither the Company nor any Subsidiary (i) is a Person described or
designated in the Specially Designated Nationals and Blocked Persons List of
the Office of Foreign Assets Control or in Section 1 of the Anti-Terrorism
Order or (ii) knowingly engages in any dealings or transactions with any
such Person.  The Company and its
Subsidiaries are in compliance, in all material respects, with the USA Patriot
Act.

 

9

 

(c)                                  No part of the proceeds from the sale of the Notes hereunder will be
used, directly or indirectly, for any payments to any governmental official or
employee, political party, official of a political party, candidate for
political office, or anyone else acting in an official capacity, in order to
obtain, retain or direct business or obtain any improper advantage, in
violation of the United States Foreign Corrupt Practices Act of 1977, as
amended, assuming in all cases that such Act applies to the Company.

 

Section 5.17.                                         Status under Certain Statutes.  (a) 
Neither the Company nor any of its Subsidiaries is (i) an “investment
company,” or a company “controlled” by an “investment company,” each as defined
in, or subject to regulation under, the Investment Company Act of 1940, as
amended, (ii) a “holding company” as defined in, or subject to regulation
under, the Public Utility Holding Company Act of 2005, or (iii) subject to
regulation under the ICC Termination Act of 1995, as amended, or the Federal
Power Act, as amended.  Except for net
capital and other requirements imposed on registered broker-dealers, neither
the Company nor any of its Subsidiaries is subject to any regulation under any
Requirement of Law (other than Regulation X of the Board of Governors of the
Federal Reserve System) that limits its ability to incur Indebtedness.

 

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

 

Section 5.18.                                         Environmental Matters.  (a) 
Neither the Company nor any Subsidiary has knowledge of any claim or has
received any notice of any claim, and no proceeding has been instituted raising
any claim against the Company or any of its Subsidiaries or any of their
respective real properties now or formerly owned, leased or operated by any of
them or other assets, alleging any damage to the environment or violation of
any Environmental Laws, except, in each case, such as could not reasonably be
expected to result in a Material Adverse Effect.

 

(b)                                 Neither the Company nor any Subsidiary has knowledge of any facts which
would give rise to any claim, public or private, of violation of Environmental
Laws or damage to the environment emanating from, occurring on or in any way
related to real properties now or formerly owned, leased or operated by any of
them or to other assets or their use, except, in each case, such as could not
reasonably be expected to result in a Material Adverse Effect.

 

(c)                                  Neither the Company nor any Subsidiary has stored any Hazardous Materials
on real properties now or formerly owned, leased or operated by any of them and
has not disposed of any Hazardous Materials in a manner contrary to any
Environmental Laws in each case in any manner that could reasonably be expected
to result in a Material Adverse Effect; and

 

(d)                                 All buildings on all real properties now owned, leased or operated by the
Company or any Subsidiary are in compliance with applicable Environmental Laws,
except where failure to comply could not reasonably be expected to result in a
Material Adverse Effect.

 

10

 

SECTION 6.                                                                         REPRESENTATIONS OF THE PURCHASERS.

 

Section 6.1.                                                Purchase for Investment.  Each
Purchaser severally represents that it is purchasing the Notes for its own
account or for one or more separate accounts maintained by such Purchaser or
for the account of one or more pension or trust funds and not with a view to
the distribution thereof, provided
that the disposition of such Purchaser’s or their property shall at all times
be within such Purchaser’s or their control. 
Each Purchaser understands that the Notes have not been registered under
the Securities Act and may be resold only if registered pursuant to the
provisions of the Securities Act or if an exemption from registration is
available, except under circumstances where neither such registration nor such
an exemption is required by law, and that the Company is not required to
register the Notes.

 

Section 6.2.                                                Source of Funds.  Each
Purchaser severally represents that at least one of the following statements is
an accurate representation as to each source of funds (a “Source”) to be used by such Purchaser to pay the
purchase price of the Notes to be purchased by such Purchaser hereunder:

 

(a)                                 the Source is an “insurance company general account” (as the term is
defined in the United States Department of Labor’s Prohibited Transaction
Exemption (“PTE”) 95-60) in
respect of which the reserves and liabilities (as defined by the annual
statement for life insurance companies approved by the NAIC (the “NAIC Annual Statement”)) for the general
account contract(s) held by or on behalf of any employee benefit plan
together with the amount of the reserves and liabilities for the general
account contract(s) held by or on behalf of any other employee benefit
plans maintained by the same employer (or affiliate thereof as defined in PTE
95-60) or by the same employee organization in the general account do not
exceed 10% of the total reserves and liabilities of the general account
(exclusive of separate account liabilities) plus surplus as set forth in the
NAIC Annual Statement filed with such Purchaser’s state of domicile; or

 

(b)                                 the Source is a separate account that is maintained solely in connection
with such Purchaser’s fixed contractual obligations under which the amounts
payable, or credited, to any employee benefit plan (or its related trust) that
has any interest in such separate account (or to any participant or beneficiary
of such plan (including any annuitant)) are not affected in any manner by the investment
performance of the separate account; or

 

(c)                                  the Source is either (i) an insurance company pooled separate
account, within the meaning of PTE 90-1 or (ii) a bank collective
investment fund, within the meaning of the PTE 91-38 and, except as disclosed
by such Purchaser to the Company in writing pursuant to this clause (c), no
employee benefit plan or group of plans maintained by the same employer or
employee organization beneficially owns more than 10% of all assets allocated
to such pooled separate account or collective investment fund; or

 

(d)                                 the Source constitutes assets of an “investment fund” (within the meaning
of Part V of PTE 84-14 (the “QPAM
Exemption”)) managed by a “qualified professional asset manager” or “QPAM”
(within the meaning of Part V of the QPAM Exemption), no employee benefit
plan’s assets that are included in such investment fund, when combined with the
assets of all other employee benefit plans established or maintained by the
same employer or by an 

 

11

 

affiliate (within the meaning of Section V(c)(1) of
the QPAM Exemption) of such employer or by the same employee organization and
managed by such QPAM, exceed 20% of the total client assets managed by such
QPAM, the conditions of Part I(a), (c) and (g) of the QPAM
Exemption are satisfied, the QPAM does not own a 10% or more interest in the
Company and any person controlling or controlled by the QPAM (applying the
definition of “control” in Section V(e) of the QPAM Exemption) does
not own a 20% or more interest in the Company and (i) the identity of such
QPAM and (ii) the names of all employee benefit plans whose assets are
included in such investment fund have been disclosed to the Company in writing
pursuant to this clause (d); or

 

(e)                                  the Source constitutes assets of a “plan(s)” (within the meaning of Section IV
of PTE 96-23 (the “INHAM Exemption”))
managed by an “in-house asset manager” or “INHAM” (within the meaning of Part IV
of the INHAM Exemption), the conditions of Part I(a), (g) and (h) of
the INHAM Exemption are satisfied, neither the INHAM nor a person controlling
or controlled by the INHAM (applying the definition of “control” in Section IV(d) of
the INHAM Exemption) owns a 5% or more interest in the Company and (i) the
identity of such INHAM and (ii) the name(s) of the employee benefit
plan(s) whose assets constitute the Source have been disclosed to the
Company in writing pursuant to this clause (e); or

 

(f)                                   the Source is a governmental plan; or

 

(g)                                  the Source is one or more employee benefit plans, or a separate account
or trust fund comprised of one or more employee benefit plans, each of which
has been identified to the Company in writing pursuant to this clause (g); or

 

(h)                                 the Source does not include assets of any employee benefit plan, other
than a plan exempt from the coverage of ERISA and Section 4975 of the
Code.

 

As
used in this Section 6.2, the terms “employee benefit plan,”
“governmental plan,” and “separate account” shall have the respective meanings
assigned to such terms in section 3 of ERISA.

 

SECTION 7.                                                                         INFORMATION AS TO COMPANY.

 

Section 7.1.                                                Financial and Business Information.  The
Company shall deliver to each holder of Notes that is an Institutional
Investor:

 

(a)                                 Quarterly Statements —
within 45 days after the end of each quarterly fiscal period in each fiscal
year of the Company (other than the last quarterly fiscal period of each such
fiscal year), duplicate copies of

 

(i)                                     a consolidated balance sheet of the Company and its Subsidiaries as at
the end of such quarter, and

 

(ii)                                  consolidated statements of income, changes in stockholders’ equity and
cash flows of the Company and its Subsidiaries, for such quarter and (in the
case of the second and third quarters) for the portion of the fiscal year
ending with such quarter,

 

12

 

setting
forth in each case in comparative form the figures for the corresponding
periods in the previous fiscal year, all in reasonable detail, prepared in
accordance with GAAP applicable to quarterly financial statements generally,
and certified by a Senior Financial Officer as fairly presenting, in all
material respects, the financial position of the companies being reported on
and their results of operations and cash flows, subject to changes resulting
from year-end adjustments, provided that
delivery within the time period specified above of copies of the Company’s
Quarterly Report on Form 10-Q (“Form 10-Q”)
prepared in compliance with the requirements therefor and filed by the Company
with the SEC shall be deemed to satisfy the requirements of this Section 7.1(a),
provided, further,
that the Company shall be deemed to have made such delivery of such Form 10-Q
if it shall have timely made such Form 10-Q available on “EDGAR” and on its
home page on the worldwide web (at the date of this Agreement located
at:  http//www.waddell.com) (such
availability being referred to as “Electronic Delivery”),
and provided, further,
that in the case of Electronic Delivery of any such financial statements, the
Company shall deliver to each holder of Notes that is an Institutional Investor
upon request (including by electronic mail) by such holder of Notes
(x) printed copies of such financial statements or (y) an electronic
copy of such Form 10-Q or a link to the page on the worldwide web on
which such Form 10-Q is available, free of charge, via electronic mail to
the electronic mail address or addresses of such holder set forth in Schedule A
or otherwise provided to the Company in accordance with Section 18;

 

(b)                                 Annual Statements —
within 90 days after the end of each fiscal year of the Company, duplicate
copies of

 

(i)                                     a consolidated balance sheet of the Company and its Subsidiaries as at
the end of such year, and

 

(ii)                                  consolidated statements of income, changes in stockholders’ equity and
cash flows of the Company and its Subsidiaries for such year,

 

setting
forth in each case in comparative form the figures for the previous fiscal
year, all in reasonable detail, prepared in accordance with GAAP, and accompanied
by an opinion thereon of independent public accountants of recognized national
standing, which opinion shall state that such financial statements present
fairly, in all material respects, the financial position of the companies being
reported upon and their results of operations and cash flows and have been
prepared in conformity with GAAP, and that the examination of such accountants
in connection with such financial statements has been made in accordance with
Public Company Accounting Oversight Board standards, and that such audit
provides a reasonable basis for such opinion in the circumstances, and provided that the delivery within the time period specified
above of the Company’s Annual Report on Form 10-K (“Form 10-K”)
for such fiscal year (together with the Company’s annual report to
stockholders, if any, prepared pursuant to Rule 14a-3 under the Exchange
Act), prepared in accordance with the requirements therefor and filed with the
SEC, shall be deemed to satisfy the requirements of this Section 7.1(b), provided, further, that
the Company shall be deemed to have made such delivery of such Form 10-K
and annual report to stockholders if it shall have timely made Electronic
Delivery thereof, and provided, further, that in the case of Electronic Delivery of any such
financial statements, the Company shall deliver to each holder of Notes that is
an Institutional Investor upon request (including by electronic mail) by such
holder of Notes (x) printed copies of such financial statements or (y) an
electronic copy 

 

13

 

of
such Form 10-K and annual report to stockholders or a link to the page on
the worldwide web on which such Form 10-K and annual report to
stockholders is available, free of charge, via electronic mail to the
electronic mail address or addresses of such holder set forth in Schedule A or
otherwise provided to the Company in accordance with Section 18;

 

(c)                                  SEC and Other Reports — promptly upon their becoming available, one copy of each current
report on Form 8-K (except for such reports that are required to be filed
solely pursuant to Item 2.02 of Form 8-K or any successor item) and each
proxy statement filed by the Company or any Subsidiary with the SEC, provided that the Company shall be deemed to have made such
delivery of any such current report on Form 8-K or proxy statement if it
shall have timely made Electronic Delivery thereof and shall have given each
such holder of Notes prompt notice of such availability on EDGAR and on its
home page via electronic mail to the electronic mail address or addresses
of such holder set forth in Schedule A or otherwise provided to the Company in
accordance with Section 18 in connection with each such delivery;

 

(d)                                 Notice of Default or Event of Default — promptly, and in any event within five Business Days after a
Responsible Officer becoming aware of the existence of any Default or Event of
Default or that any Person has given any notice or taken any action with
respect to a claimed default hereunder or that any Person has given any notice
or taken any action with respect to a claimed default of the type referred to
in Section 11(f), a written notice specifying the nature and period of
existence thereof and what action the Company is taking or proposes to take
with respect thereto;

 

(e)                                  ERISA Matters —
promptly, and in any event within five days after a Responsible Officer
becoming aware of any of the following, a written notice setting forth the
nature thereof and the action, if any, that the Company or an ERISA Affiliate
proposes to take with respect thereto:

 

(i)                                     with respect to any Pension Plan, any reportable event, as defined in
section 4043(c) of ERISA and the regulations thereunder, for which notice
thereof has not been waived pursuant to such regulations as in effect from time
to time; or

 

(ii)                                  the taking by the PBGC of steps to institute, or the threatening by the
PBGC of the institution of, proceedings under section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Pension
Plan, or the receipt by the Company or any ERISA Affiliate of a notice from a
Multiemployer Plan that such action has been taken by the PBGC with respect to
such Multiemployer Plan; or

 

(iii)                               any event, transaction or condition that could result in the incurrence
of any liability by the Company or any ERISA Affiliate pursuant to Title I or
IV of ERISA or the penalty or excise tax provisions of the Code relating to
employee benefit plans, or in the imposition of any Lien on any of the rights,
properties or assets of the Company or any ERISA Affiliate pursuant to Title I
or IV of ERISA or such penalty or excise tax provisions, if such liability or
Lien, taken together with any other such liabilities or Liens then existing,
could reasonably be expected to have a Material Adverse Effect;

 

14

 

(f)                                   Net Asset Value and Aggregate Revenue Base —  after the end of each calendar month,
(i) a schedule of the Net Asset Value of the investment companies, funds
and accounts managed by the Company and its Subsidiaries on the last day of
such calendar month and certain other information, substantially in the form of
Exhibit 7.1(f)(i), and (ii) a schedule showing the calculation of the
Aggregate Revenue Base as of the end of such calendar month, and an analysis of
changes from the preceding calendar month, substantially in the form of Exhibit 7.1(f)(ii),
or in each case, in such other form as is provided to the Company’s principal
lending banks pursuant to the terms of the Existing Credit Facility or any
other Major Credit Facility; provided that
the Company shall be deemed to have made such delivery of any such schedule if
it shall have sent such schedule to the electronic mail address or addresses of
such holder set forth in Schedule A or otherwise provided to the Company in
accordance with Section 18 in connection with such delivery; and provided, further, that if, at any time, any such schedule
is not required to be (and is not) delivered to the Company’s principal lending
banks pursuant to the terms of the Existing Credit Facility or any other Major
Credit Facility, the Company shall not be required to deliver such schedule
pursuant to this Section 7.1(f);

 

(g)                                  Notices from Governmental Authority — promptly, and in any event within 30 days of receipt thereof, copies
of any notice to the Company or any Subsidiary from any Federal or state
Governmental Authority relating to any order, ruling, statute or other law or
regulation that could reasonably be expected to have a Material Adverse Effect;

 

(h)                                 Certain Other Events — promptly, and in any event within 30 days of any Responsible Officer
becoming aware thereof, notice of:

 

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

 

(ii)                                  any suspension or termination of the registration of the Company or any
Subsidiary as an investment adviser under the Investment Advisers Act of 1940,
as amended, or any cancellation or expiration without renewal of any Material
investment advisory agreement or similar contract to which the Company or any
Subsidiary is a party; and

 

(i)                                     Requested Information — with reasonable promptness, such other data and information relating
to the business, operations, affairs, financial condition, assets or properties
of the Company or any of its Subsidiaries or relating to the ability of the
Company to perform its obligations hereunder and under the Notes as from time
to time may be reasonably requested by any such holder of Notes.

 

Each notice delivered
under Section 7.1(g) or Section 7.1(h) shall be accompanied
by a certificate of a Senior Financial Officer setting forth the details of the
event or development requiring such notice and any action taken or proposed to
be taken with respect thereto.

 

Section 7.2.                                                Officer’s Certificate.  Each
set of financial statements delivered to a holder of Notes pursuant to Section 7.1(a) or
Section 7.1(b) shall be accompanied by a certificate

 

15

 

of a Senior Financial
Officer setting forth (which, in the case of Electronic Delivery of any such
financial statements, shall be by physical delivery of such certificate to each
holder of Notes within the applicable time period set forth in Section 7.1):

 

(a)                                  Covenant Compliance —
(i) the information (including detailed calculations) required in order to
(x) establish whether the Company was in compliance with the requirements
of Section 10.1 as at the end of the quarterly or annual period covered by
the statements then being furnished (including with respect to each such
Section, where applicable, the calculations of the maximum or minimum amount,
ratio or percentage, as the case may be, permissible under the terms of such
Sections, and the calculation of the amount, ratio or percentage then in
existence), and (y) show the aggregate amount of Subsidiary Indebtedness,
secured Indebtedness and Attributable Debt in connection with Sale/Leaseback
Transactions permitted to be incurred pursuant to Sections 10.2, 10.3, 10.5 and
10.6, respectively, as of the last day of the quarterly or annual period
covered by the statements then being furnished and (ii) a full description
of any material change to the basis on which such financial statements shall
have been prepared and the impact of such change on the financial and other
covenants set forth in Sections 10.1, 10.2, 10.3, 10.5 and 10.6, including a
reasonable reconciliation of the relevant figures required for the purpose of
clause (i)(x) of this Section 7.2(a) and such other information
as shall be sufficient to enable a holder of a Note to make a reasonable
comparison between the financial position and results of operations shown by
the financial statements then being furnished and the most recent audited
financial statements previously delivered pursuant to Section 7.1(b); and

 

(b)                                 Event of Default —
a statement that such Senior Financial Officer has reviewed the relevant terms
hereof and has made, or caused to be made, under his or her supervision, a
review of the transactions and conditions of the Company and its Subsidiaries
from the beginning of the quarterly or annual period covered by the statements
then being furnished to the date of the certificate and that such review shall
not have disclosed the existence during such period of any condition or event
that constitutes a Default or an Event of Default and is continuing as of the
date of such statement or, if any such condition or event exists (including,
without limitation, any such event or condition resulting from the failure of
the Company or any Subsidiary to comply with any Environmental Law), specifying
the nature and period of existence thereof and what action the Company shall
have taken or proposes to take with respect thereto.

 

For the avoidance of doubt,
for the purposes of determining compliance with the requirements of Sections
10.1, 10.2 and 10.3, any election by the Company or its Subsidiaries to measure
a financial liability using fair value (as permitted by Financial Accounting
Standards Board ASC 825 and ASC 470-20 or any similar accounting standard),
shall be disregarded and such determination shall be made as if such election
had not been made.

 

Section 7.3.                                Visitation.  The
Company shall permit the representatives of each holder of Notes that is an
Institutional Investor:

 

(a)                                  No Default —
if no Default or Event of Default then exists, at the expense of such holder
and upon reasonable prior notice to the Company, to visit the principal
executive office of the Company, to discuss the affairs, finances and accounts
of the Company and its Subsidiaries with the Company’s officers, and (with the
consent of the Company, which consent will not be 

 

16

 

unreasonably withheld) its independent public accountants,
and (with the consent of the Company, which consent will not be unreasonably
withheld) to visit the other offices and properties of the Company and each
Subsidiary, during normal business hours and as often as may be reasonably
requested; and

 

(b)                                 Default —
if a Default or Event of Default then exists, at the expense of the Company to
visit and inspect any of the offices or properties of the Company or any
Subsidiary, to examine all their respective books of account, records, reports
and other papers, to make copies and extracts therefrom, and to discuss their
respective affairs, finances and accounts with their respective officers and
independent public accountants (and by this provision the Company authorizes
said accountants to discuss the affairs, finances and accounts of the Company
and its Subsidiaries), all at such reasonable times and as often as may be
requested.

 

SECTION 8.                                                                PAYMENT AND PREPAYMENT OF THE NOTES.

 

Section 8.1.                                Maturity.  As
provided therein, the entire unpaid principal balance of the Notes of each
series shall be due and payable on the stated maturity date thereof.

 

Section 8.2.                                Optional Prepayments with Make-Whole Amount.  The
Company may, at its option, upon notice as provided below, prepay at any time
all, or from time to time any part of, the Notes (in a minimum principal amount
of $5,000,000 and integral multiples of $1,000,000 in excess thereof in the
case of a partial prepayment) at 100% of the principal amount so prepaid, plus
the applicable Make-Whole Amount for the Notes of each series determined for
the prepayment date with respect to such principal amount.  The Company will give each holder of Notes
written notice of each optional prepayment under this Section 8.2 not less
than 30 days and not more than 60 days prior to the date fixed for such
prepayment.  Each such notice shall
specify such date (which shall be a Business Day), the aggregate principal
amount of the Notes of each series to be prepaid on such date, the principal
amount of each Note held by such holder to be prepaid (determined in accordance
with Section 8.4), and the interest to be paid on the prepayment date with
respect to such principal amount being prepaid, and shall be accompanied by a
certificate of a Senior Financial Officer as to the estimated Make-Whole Amount
for the Notes of each series due in connection with such prepayment (calculated
as if the date of such notice were the date of the prepayment), setting forth
the details of such computation.  Two Business
Days prior to such prepayment, the Company shall deliver to each holder of
Notes a certificate of a Senior Financial Officer specifying the calculation of
such Make-Whole Amount for the Notes of each series as of the specified
prepayment date.

 

Section 8.3.                                Prepayment in Connection with a Change of
Control.  Promptly and in any event within five
Business Days after the occurrence of a Change of Control, the Company will
give written notice thereof (a “Change of
Control Notice”) to the holders of all outstanding Notes, which
Change of Control Notice shall (a) refer specifically to this Section 8.3,
(b) describe the Change of Control in reasonable detail and specify the
Change of Control Prepayment Date and the Response Date (as respectively
defined below) in respect thereof and (c) offer to prepay all Notes at the
price specified below on the date therein specified (the “Change of Control Prepayment Date”), which
shall be a Business Day following the Response Date referred to below and in
any event not more than 90 days after the date of such Change of Control
Notice.  Each holder of a Note will
notify the Company of such holder’s 

 

17

 

acceptance or rejection
of such offer by giving written notice of such acceptance or rejection to the
Company on or before the date for such notice specified in such Change of
Control Notice (the “Response Date”),
which specified date shall be not less than 30 days nor more than 60 days after
the date of such Change of Control Notice. 
The Company shall prepay on the Change of Control Prepayment Date all of
the Notes held by the holders as to which such offer has not been so rejected
(it being understood that failure of any holder to reject such offer on or
before the Response Date shall be deemed to constitute a rejection by such
holder), at 100% of the principal amount of each such Note, together with
interest accrued thereon to the Change of Control Prepayment Date for each such
Note.  If any holder shall reject (or is
deemed to have rejected) such offer with respect to any Note held by such
holder on or before the Response Date, such holder shall be deemed to have
waived its rights under this Section 8.3 to require prepayment of such
Note for which such offer was rejected in respect of such Change of Control but
not in respect of any subsequent Change of Control.

 

For
purposes of this Section 8.3, any holder of more than one Note may act
separately with respect to each Note so held (with the effect that a holder of
more than one Note may accept such offer with respect to one or more Notes so
held and reject such offer with respect to one or more other Notes so held).

 

As
used herein, a “Change of Control” shall be deemed
to have occurred if, whether by an event or series of events:

 

(a)                                  any “person” or “group” (as such terms are used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended, but excluding
any employee benefit plan of such person or its subsidiaries, and any person or
entity acting in its capacity as trustee, agent or other fiduciary or
administrator of any such plan) becomes the “beneficial owner” (as defined in Rules 13d-3
and 13d-5 under the Securities Exchange Act of 1934, as amended, except that a
person or group shall be deemed to have “beneficial ownership” of all securities
that such person or group has the right to acquire, whether such right is
exercisable immediately or only after the passage of time (such right, an “option
right”)), directly or indirectly, of 25% or more of the equity securities of
the Company entitled to vote for members of the board of directors or
equivalent governing body of the Company on a fully-diluted basis (and taking
into account all such securities that such person or group has the right to
acquire pursuant to any option right);

 

(b)                                 during any period of 12 consecutive months, a majority of the members of
the board of directors or other equivalent governing body of the Company cease
to be composed of individuals (i) who were members of that board or
equivalent governing body on the first day of such period, (ii) whose
election or nomination to that board or equivalent governing body was approved
by individuals referred to in clause (i) above constituting at the time of
such election or nomination at least a majority of that board or equivalent governing
body or (iii) whose election or nomination to that board or other
equivalent governing body was approved by individuals referred to in clauses (i) and
(ii) above constituting at the time of such election or nomination at
least a majority of that board or equivalent governing body (excluding, in the
case of both clause (ii) and clause (iii), any individual whose initial
nomination for, or assumption of office as, a member of that board or
equivalent governing body occurs as a result of an actual or threatened
solicitation of proxies or consents for the election or removal of one or more
directors by any 

 

18

 

person or group other than a solicitation for the
election of one or more directors by or on behalf of the board of directors);
or

 

(c)                                  any Person or two or more Persons acting in concert shall have acquired
by contract or otherwise, or shall have entered into a contract or arrangement
that, upon consummation thereof, will result in its or their acquisition of
control over the equity securities of the Company entitled to vote for members
of the board of directors or equivalent governing body of the Company on a
fully-diluted basis (and taking into account all such securities that such
Person or group has the right to acquire pursuant to any option right)
representing 25% or more of the combined voting power of such securities.

 

Section 8.4.                                Allocation of Partial Prepayments.  In
the case of each partial prepayment of the Notes pursuant to Section 8.2,
the principal amount of the Notes to be prepaid shall be allocated among all of
the Notes at the time outstanding in proportion, as nearly as practicable, to
the respective unpaid principal amounts thereof not theretofore called for
prepayment.

 

Section 8.5.                                Maturity; Surrender, Etc.  In the
case of any prepayment of Notes pursuant to this Section 8, the principal
amount of each Note to be prepaid shall mature and become due and payable on
the date fixed for such prepayment (which shall be a Business Day), together
with interest on such principal amount accrued to such date and the applicable
Make-Whole Amount, if any.  From and
after such date, unless the Company shall fail to pay such principal amount
when so due and payable, together with the interest and Make-Whole Amount, if
any, as aforesaid, interest on such principal amount shall cease to
accrue.  Any Note paid or prepaid in full
shall be surrendered to the Company and cancelled and shall not be reissued,
and no Note shall be issued in lieu of any prepaid principal amount of any
Note.

 

Section 8.6.                                Purchase of Notes.  The
Company will not and will not permit any Subsidiary to purchase, redeem, prepay
or otherwise acquire, directly or indirectly, any of the outstanding Notes
except upon the payment or prepayment of the Notes in accordance with the terms
of this Agreement and the Notes.  The
Company will promptly cancel all Notes acquired by it or any Affiliate pursuant
to any payment or prepayment of Notes pursuant to any provision of this
Agreement and no Notes may be issued in substitution or exchange for any such
Notes.

 

Section 8.7.                                Make-Whole Amount.

 

“Make-Whole Amount” means, with respect to any Note, an
amount equal to the excess, if any, of the Discounted Value of the Remaining
Scheduled Payments with respect to the Called Principal of such Note over the
amount of such Called Principal, provided that
the Make-Whole Amount may in no event be less than zero.  For the purposes of determining the
Make-Whole Amount, the following terms have the following meanings:

 

“Called Principal” means, with respect to any Note, the
principal of such Note that is to be prepaid pursuant to Section 8.2 or
has become or is declared to be immediately due and payable pursuant to Section 12.1,
as the context requires.

 

“Discounted Value” means, with respect to the Called
Principal of any Note, the amount obtained by discounting all Remaining
Scheduled Payments with respect to such Called Principal 

 

19

 

from
their respective scheduled due dates to the Settlement Date with respect to
such Called Principal, in accordance with accepted financial practice and at a
discount factor (applied on the same periodic basis as that on which interest
on the Notes is payable) equal to the Reinvestment Yield with respect to such
Called Principal.

 

“Reinvestment Yield” means, with respect to the Called
Principal of any Note, 0.50% (50 basis points) over the yield to maturity
implied by (i) the yields reported, as of 10:00 a.m. (New York City time)
on the second Business Day preceding the Settlement Date with respect to such
Called Principal, (x) on the Bloomberg Financial Markets News screen PX1
or the equivalent screen provided by Bloomberg Financial Markets News, or
(y) if such on-line market data is not at the time provided by Bloomberg
Financial Markets News, on the display designated as “Pages K:232 through
K:238” on the Analytics Display of the Reuters Trading System, in any case for
the most recently issued actively traded on the run U.S. Treasury securities
having a maturity equal to the Remaining Average Life of such Called Principal
as of such Settlement Date, or (ii) if such yields are not reported as of
such time or the yields reported as of such time are not ascertainable (including
by way of interpolation), the Treasury Constant Maturity Series Yields
reported, for the latest day for which such yields have been so reported as of
the second Business Day preceding the Settlement Date with respect to such
Called Principal, in Federal Reserve Statistical Release H.15 (519) (or any
comparable successor publication) for actively traded on the run U.S. Treasury
securities having a constant maturity equal to the Remaining Average Life of
such Called Principal as of such Settlement Date.

 

In
the case of each determination under clause (i) or clause (ii), as the
case may be, of the preceding paragraph, such implied yield will be determined,
if necessary, by (a) converting U.S. Treasury bill quotations to
bond-equivalent yields in accordance with accepted financial practice and
(b) interpolating linearly between (1) the applicable actively traded
on the run U.S. Treasury security with a maturity closest to and greater than
such Remaining Average Life and (2) the applicable actively traded on the
run U.S. Treasury security with a maturity closest to and less than such
Remaining Average Life.

 

“Remaining Average Life” means, with respect to any Called
Principal, the number of years (calculated to the nearest one-twelfth year)
obtained by dividing (i) such Called Principal into (ii) the sum of
the products obtained by multiplying (a) the principal component of each
Remaining Scheduled Payment with respect to such Called Principal by (b) the
number of years (calculated to the nearest one-twelfth year) that will elapse
between the Settlement Date with respect to such Called Principal and the
scheduled due date of such Remaining Scheduled Payment.

 

“Remaining Scheduled Payments” means, with respect to the
Called Principal of any Note, all payments of such Called Principal and
interest thereon that would be due after the Settlement Date with respect to
such Called Principal if no payment of such Called Principal were made prior to
its scheduled due date, provided that
if such Settlement Date is not a date on which interest payments are due to be
made under the terms of the Notes, then the amount of the next succeeding
scheduled interest payment will be reduced by the amount of interest accrued to
such Settlement Date and required to be paid on such Settlement Date pursuant
to Section 8.2 or Section 12.1.

 

20

 

“Settlement Date” means, with respect to the Called Principal
of any Note, the date on which such Called Principal is to be prepaid pursuant
to Section 8.2 or has become or is declared to be immediately due and
payable pursuant to Section 12.1, as the context requires.

 

SECTION 9.                                                                AFFIRMATIVE COVENANTS.

 

So
long as any of the Purchasers have the obligation to purchase Notes on the
terms and subject to the conditions set forth herein, any of the Notes are
outstanding, or any amounts payable hereunder remain unpaid or unsatisfied, the
Company covenants that:

 

Section 9.1.                                Compliance with Law. 
Without limiting Section 10.10, the Company will, and will cause
each of its Subsidiaries to, comply with all laws, ordinances or governmental rules or
regulations to which each of them is subject, including, without limitation,
ERISA, the USA Patriot Act and Environmental Laws, and will obtain and maintain
in effect all licenses, certificates, permits, franchises and other
governmental authorizations necessary to the ownership of their respective
properties or to the conduct of their respective businesses, in each case to
the extent necessary to ensure that non-compliance with such laws, ordinances
or governmental rules or regulations or failures to obtain or maintain in
effect such licenses, certificates, permits, franchises and other governmental
authorizations could not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect.

 

Section 9.2.                                Insurance.  The
Company will, and will cause each of its Subsidiaries to, maintain, with
financially sound and reputable insurers, insurance with respect to their
respective properties and businesses against such casualties and contingencies,
of such types, on such terms and in such amounts (including deductibles,
co-insurance and self-insurance, if adequate reserves are maintained with
respect thereto) as is customary in the case of entities of established
reputations engaged in the same or a similar business and similarly situated.

 

Section 9.3.                                Maintenance of Properties.  The
Company will, and will cause each of its Subsidiaries to, maintain and keep, or
cause to be maintained and kept, their respective properties in good repair,
working order and condition (other than ordinary wear and tear), so that the
business carried on in connection therewith may be properly conducted at all
times, provided that this Section shall not prevent the Company or any Subsidiary
from discontinuing the operation and the maintenance of any of its properties
if such discontinuance is desirable in the conduct of its business and the
Company has concluded that such discontinuance could not, individually or in
the aggregate, reasonably be expected to have a Material Adverse Effect.

 

Section 9.4.                                Payment of Taxes and Claims.  The
Company will, and will cause each of its Subsidiaries to, file all tax returns
required to be filed in any jurisdiction and to pay and discharge all taxes
shown to be due and payable on such returns and all other taxes, assessments,
governmental charges, or levies imposed on them or any of their properties,
assets, income or franchises, to the extent the same have become due and
payable and before they have become delinquent and all claims for which sums
have become due and payable that have or might become a Lien on properties or
assets of the Company or any Subsidiary, provided
that neither the Company nor any Subsidiary need pay any such tax, assessment,
charge, levy or claim if (i) the amount, applicability or validity thereof
is contested by the Company or such Subsidiary on a timely basis in good faith
and in appropriate proceedings, and the Company or a 

 

21

 

Subsidiary has
established adequate reserves therefor in accordance with GAAP on the books of
the Company or such Subsidiary or (ii) the nonpayment of all such taxes,
assessments, charges, levies and claims in the aggregate could not reasonably
be expected to have a Material Adverse Effect.

 

Section 9.5.                                Corporate Existence, Etc. 
Subject to Section 10.5, the Company will at all times preserve and
keep in full force and effect its corporate existence and the corporate
existence of each of its Subsidiaries (unless merged into the Company or a
Wholly-Owned Subsidiary) and all rights and franchises of the Company and its
Subsidiaries unless, in the good faith judgment of the Company, the termination
of or failure to preserve and keep in full force and effect such corporate
existence, right or franchise could not, individually or in the aggregate, have
a Material Adverse Effect.

 

Section 9.6.                                Books and Records.  The
Company will, and will cause each of its Subsidiaries to, maintain proper books
of record and account in conformity with GAAP and all applicable requirements
of any Governmental Authority having legal or regulatory jurisdiction over the
Company or such Subsidiary, as the case may be.

 

SECTION 10.                                                         NEGATIVE COVENANTS.

 

So
long as any of the Purchasers have the obligation to purchase Notes on the
terms and subject to the conditions set forth herein, any of the Notes are
outstanding, or any amounts payable hereunder remain unpaid or unsatisfied, the
Company covenants that:

 

Section 10.1.                         Maintenance of Financial Conditions.  The
Company will not permit:

 

(a)                                  the ratio of Consolidated Total Debt on the last day of any Relevant
Period to Consolidated EBITDA in respect of such Relevant Period to equal or
exceed 3.00 to 1.00; and

 

(b)                                 the ratio of Consolidated EBITDA to Consolidated Interest Expense in
respect of any Relevant Period to be less than or equal to 4.00 to 1.

 

Section 10.2.                         Subsidiary Indebtedness, Etc.

 

(a)                                  The Company will not permit any Subsidiary to create, incur, assume,
guarantee or otherwise become liable with respect to or permit to exist any
Indebtedness other than:

 

(i)                                     Indebtedness existing on the date hereof and set forth in Schedule 10.2,
but not any extensions, renewals or replacements of any such Indebtedness;

 

(ii)                                  Indebtedness of any Subsidiary to the Company or any Wholly-Owned
Subsidiary;

 

(iii)                               Indebtedness of any Subsidiary incurred to finance the acquisition,
construction or improvement of any fixed or capital assets, including Capital
Lease Obligations and any Indebtedness assumed in connection with the
acquisition of any such assets or secured by a Lien on any such assets prior to
the acquisition thereof, and extensions, renewals and replacements of any such
Indebtedness that do not increase the 

 

22

 

outstanding principal
amount thereof; provided, that (A) such
Indebtedness is incurred prior to or within 90 days after such acquisition or
the completion of such construction or improvement, and (B) the aggregate
principal amount of Indebtedness permitted by this clause (iii) shall not
exceed $10,000,000 at any time outstanding;

 

(iv)                              Indebtedness of any Person that becomes a Subsidiary after the date
hereof; provided, that such Indebtedness exists
at the time such Person becomes a Subsidiary and is not created in
contemplation of or in connection with such Person becoming a Subsidiary,
provided that neither the Company nor any other Subsidiary will assume or
otherwise become directly or indirectly liable for such Indebtedness;

 

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

 

(vi)                              Indebtedness not otherwise permitted by clauses (i) through (v) above;
provided, that the sum (without
duplication) of (A) the aggregate principal amount of Indebtedness of all
Subsidiaries (other than Indebtedness as permitted by clauses (i), (ii) and
(iii) above), plus (B) the aggregate principal amount of Indebtedness
secured by Liens permitted by clause (e) of Section 10.3 shall not at
any time exceed 15% of the Consolidated Net Worth of the Company.

 

(b)                                 The Company will not and will not permit any Subsidiary to become a party
to, or otherwise subject to, any agreement that materially restricts the
ability of such Subsidiary to pay dividends out of profits, repay intercompany
obligations or make any other distributions of profits to the Company or any of
its Subsidiaries that own outstanding shares of capital stock or similar equity
interests of such Subsidiary; provided, that
the foregoing shall not apply to any (i) restrictions and conditions
contained in this Agreement and (ii) customary restrictions and conditions
contained in agreements relating to the sale of a Subsidiary pending such sale,
provided such restrictions and conditions apply only to the Subsidiary that is
to be sold.

 

Section 10.3.                         Liens.  The
Company will not, and will not permit any Subsidiary to, create, incur, assume
or permit to exist any Lien on any property or asset now owned or hereafter
acquired by it, or assign or sell any income or revenues (including accounts
receivable) or rights in respect of any thereof, except:

 

(a)                                  Permitted Encumbrances;

 

(b)                                 any Lien on any property or asset of the Company or any Subsidiary
existing on the date hereof and set forth in Schedule 10.3; provided, that (i) such Lien shall not apply to any
other property or asset of the Company or any Subsidiary, and (ii) such
Lien shall secure only those obligations which it secures on the date hereof;

 

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

 

23

 

those obligations which it secures on the date of
such acquisition or the date such Person becomes a Subsidiary, as the case may
be;

 

(d)                                 Liens on property, plant and equipment acquired, constructed or improved
by the Company or any Subsidiary; provided, that
(i) such Liens secure Indebtedness permitted by Section 10.2(a)(iii),
(ii) such security interests and the Indebtedness secured thereby are
incurred prior to or within 90 days after such acquisition or the completion of
such construction or improvement, (iii) the Indebtedness secured thereby
does not exceed 70% of the cost of acquiring, constructing or improving such
property, plant and equipment, and (iv) such security interests shall not
apply to any other property or assets of the Company or any Subsidiary; and

 

(e)                                  Liens not otherwise permitted by clauses (a) through (d) above
securing Indebtedness of the Company or a Subsidiary; provided,
that the sum (without duplication) of (i) the aggregate principal amount
of Indebtedness secured by all such Liens permitted by this clause (e), plus
(ii) the aggregate principal amount of Indebtedness of all Subsidiaries
(other than Indebtedness as permitted by subclauses (i), (ii) and (iii) of
Section 10.2(a)) shall not at any time exceed 15% of the Consolidated Net
Worth of the Company.  The Company agrees
that neither it nor any of its Subsidiaries shall use any capacity under this Section 10.3(e) to
secure any amounts owed or outstanding under any Major Credit Facility unless
the Notes and this Agreement are also concurrently secured equally and ratably
pursuant to documentation in form and substance reasonably satisfactory to the
Majority Holders (including, but not limited to, documentation such as security
agreements and other necessary or desirable collateral agreements and
instruments, an intercreditor agreement and an opinion of independent legal
counsel reasonably satisfactory to the Majority Holders).

 

If the Company shall, or
shall permit any of its Subsidiaries to, directly or indirectly create or
incur, or suffer to be incurred or to exist, any Lien, other than those Liens
permitted by the provisions of clauses (a) through (e), inclusive, of this
Section 10.3, it will make or cause to be made effective provision whereby
the Notes and this Agreement will be secured equally and ratably with any and
all other obligations thereby secured pursuant to documentation in form and
substance reasonably satisfactory to the Majority Holders as provided in clause
(e) above and, in any such case, the Notes and this Agreement shall have
the benefit, to the fullest extent that, and with such priority as, the holders
of the Notes may be entitled under applicable law, of an equitable and ratable
Lien on such property.  For the avoidance
of doubt, no grant of security or other action in accordance with this
paragraph shall cure or be deemed to cure any breach of this Section 10.3.

 

Section 10.4.                         Transactions with Affiliates.  The
Company will not and will not permit any Subsidiary to enter into directly or
indirectly any transaction or group of related transactions (including without
limitation the purchase, lease, sale or exchange of properties of any kind or
the rendering of any service) with any Affiliate (other than the Company or
another Subsidiary), except (a) in accordance with the Company’s Corporate
Code of Business Conduct and Ethics or as approved by a Committee of the Board
of Directors of the Company or a majority of the independent members of the
Board of Directors of the Company and upon fair and reasonable terms no less
favorable to the Company or such Subsidiary than would be obtainable in a
comparable arm’s-length transaction with a Person not an Affiliate or
(b) with respect to Restricted Payments otherwise permitted by clause (b) or
clause (c) of Section 10.8.

 

24

 

Section 10.5.                         Merger, Consolidation, Etc.  The
Company will not and will not permit any of its Subsidiaries to consolidate,
amalgamate or merge with any other Person or convey, transfer or lease all or
substantially all of its assets in a single transaction or series of
transactions to any Person except:

 

(a)                                  a Subsidiary may consolidate, amalgamate or merge with the Company or any
Wholly-Owned Subsidiary of the Company or convey or transfer all or
substantially all of its assets to:

 

(i)                                     the Company, provided that the Company shall be the continuing, surviving
or acquiring corporation, or

 

(ii)                                  any Wholly-Owned Subsidiary of the Company.

 

(b)                                 the Company may consolidate, amalgamate or merge with any other Person or
convey or transfer all or substantially all of its assets to any other Person, provided that the successor formed by such consolidation or
amalgamation or the survivor of such merger or the Person that acquires by
conveyance, transfer or lease all or substantially all of the assets of the
Company as an entirety, as the case may be, shall be a solvent corporation
organized and existing under the laws of the United States or any State thereof
(including the District of Columbia), and, if the Company is not such
corporation, (i) such corporation shall have executed and delivered to
each holder of any Notes its assumption of the due and punctual performance and
observance of each covenant and condition of this Agreement and the Notes and
(ii) such corporation shall have caused to be delivered to each holder of
a Note an opinion of nationally recognized independent counsel, or other
independent counsel reasonably satisfactory to the Majority Holders, to the
effect that all agreements or instruments effecting such assumption are
enforceable in accordance with their terms and comply with the terms hereof,
and provided, further, that immediately
before and immediately after giving effect to such transaction, no Default or
Event of Default shall have occurred and be continuing and the Company shall
have complied with the provisions of Section 8.3, if applicable.

 

No such conveyance,
transfer or lease of substantially all of the assets of the Company shall have
the effect of releasing the Company or any successor corporation that shall
theretofore have become such in the manner prescribed in this Section 10.5
from its liability under this Agreement or the Notes.

 

Section 10.6.                         Sales and Leasebacks.  The
Company will not, and will not permit any of its Subsidiaries to, enter into
any arrangement with any Person providing for the leasing by the Company or any
Subsidiary of real or personal property that has been or is to be sold or
transferred by the Company or such Subsidiary to such Person or to any other
Person to whom funds have been or are to be advanced by such Person on the
security of such property or rental obligations of the Company or such
Subsidiary (a “Sale/Leaseback Transaction”),
except  (a) the Sale/Leaseback
Transactions entered into with respect to the real property listed on Schedule
10.6 as of the date of this Agreement and (b) one or more Sale/Leaseback
Transactions in addition to those described in clause (a) of this Section 10.6
if after giving effect to such transaction and the incurrence of Attributable
Debt in respect thereof, the aggregate Attributable

 

25

 

 

Debt
in respect of all Sale/Leaseback Transactions entered into pursuant to this
clause (b) shall not exceed $20,000,000 (determined on the date such
transaction occurred).

 

Section 10.7.              Hedging
Agreements.  The Company will not, and will not permit any
Subsidiary to, enter into any Hedging Agreement, other than (a) Hedging
Agreements entered into in the ordinary course of business to hedge or mitigate
risks to which the Company or any Subsidiary is exposed in the conduct of its
business or the management of its liabilities and not for purposes of
speculation or taking a “market view” and (b) interest rate Hedging
Agreements in respect of Indebtedness under the Notes.

 

Section 10.8.              Restricted
Payments.  The Company will not, and will not permit any
of Subsidiary to, declare or make, or agree to pay or make, directly or
indirectly, any Restricted Payment, except (a) the Company or any
Subsidiary may declare and pay dividends (whether in cash, securities or other
property) with respect to its capital stock, provided
that, in the case of any such declaration or payment by the Company, no Event
of Default has occurred and is continuing or would result therefrom,
(b) the Company may make Restricted Payments pursuant to and in accordance
with stock option plans or other benefit plans for management or employees of
the Company and its Subsidiaries, (c) the Company may, in addition to the
foregoing, repurchase shares of the Company’s common stock and options therefor
granted by the Company pursuant to its employee stock option plans and
(d) the Company may repurchase shares of the Company’s common stock in the
open market or in private transactions, provided that in the case of any such
repurchase by the Company, no Event of Default has occurred and is continuing
or would result therefrom.

 

Section 10.9.              Line of
Business.  The Company will not and will not permit any
Subsidiary to engage to any material extent in any business if, as a result,
the general nature of the business in which the Company and its Subsidiaries,
taken as a whole, would then be engaged would be substantially changed from the
general nature of the business in which the Company and its Subsidiaries, taken
as a whole, are engaged on the date of this Agreement as described in the
Memorandum.

 

Section 10.10.           Terrorism
Sanctions Regulations.  The Company will not and will
not permit any Subsidiary to (a) become a Person described or designated
in the Specially Designated Nationals and Blocked Persons List of the Office of
Foreign Assets Control or in Section 1 of the Anti Terrorism Order or
(b) knowingly engage in any dealings or transactions with any such Person.

 

SECTION 11.                                                                     EVENTS OF DEFAULT.

 

An
“Event of Default” shall exist if any of
the following conditions or events shall occur and be continuing:

 

(a)           the Company defaults in the payment of any principal or
Make-Whole Amount, if any, on any Note when the same becomes due and payable,
whether at maturity or at a date fixed for prepayment or by declaration or
otherwise; or

 

(b)           the Company defaults in the payment of any interest on any
Note for more than five Business Days after the same becomes due and payable;
or

 

26

 

(c)           the Company defaults in the performance of or compliance
with any term contained in Section 7.1(d) or Sections 10.1, 10.2, 10.3, 10.5
and 10.6; or

 

(d)           the Company defaults in the performance of or compliance
with any term contained herein (other than those referred to in Sections 11(a),
(b) and (c)) and such default is not remedied within 30 days after the earlier
of (i) a Responsible Officer obtaining actual knowledge of such default
and (ii) the Company receiving written notice of such default from any
holder of a Note (any such written notice to be identified as a “notice of default”
and to refer specifically to this Section 11(d)); or

 

(e)           any representation or warranty made in writing by or on
behalf of the Company in this Agreement or in any writing furnished in
connection with the transactions contemplated hereby proves to have been false
or incorrect in any material respect on the date as of which made; or

 

(f)            (i) the Company or any Subsidiary is in default (as
principal or as guarantor or other surety) in the payment of any principal of
or premium or make-whole amount or interest on any Indebtedness that is
outstanding in an aggregate principal or notional amount of at least
$10,000,000 beyond any period of grace provided with respect thereto, or
(ii) the Company or any Subsidiary is in default in the performance of or
compliance with any term of any evidence of any Indebtedness in an aggregate
outstanding principal or notional amount of at least $10,000,000 or of any
mortgage, indenture or other agreement relating thereto or any other condition
exists, and as a consequence of such default or condition such Indebtedness has
become, or has been declared (or one or more Persons are entitled to declare
such Indebtedness to be), due and payable before its stated maturity or before
its regularly scheduled dates of payment or unwound or terminated prior to its
termination date, or (iii) as a consequence of the occurrence or
continuation of any event or condition (other than the passage of time or the
right of the holder of Indebtedness to convert such Indebtedness into equity interests),
(x) the Company or any Subsidiary has become obligated to purchase or
repay Indebtedness before its regular maturity or before its regularly
scheduled dates of payment in an aggregate outstanding principal amount of at
least $10,000,000 or unwind or terminate any Hedging Contract in a notional
amount at least equal to $10,000,000, or (y) one or more Persons have the
right to require the Company or any Subsidiary so to purchase, repay or unwind
or terminate such Indebtedness or Hedging Contract; provided that
this clause (f) shall not apply to secured Indebtedness that becomes due as a
result of the voluntary sale or transfer of the property or assets securing
such Indebtedness; or

 

(g)           the Company or any Subsidiary (i) is generally not
paying, or admits in writing its inability to pay, its debts as they become
due, (ii) files, or consents by answer or otherwise to the filing against
it of, a petition for relief or reorganization or arrangement or any other
petition in bankruptcy, for liquidation or to take advantage of any bankruptcy,
insolvency, reorganization, moratorium or other similar law of any
jurisdiction, (iii) makes an assignment for the benefit of its creditors,
(iv) consents to the appointment of a custodian, receiver, trustee or other
officer with similar powers with respect to it or with respect to any
substantial part of its property, (v) is adjudicated as insolvent or to be
liquidated, or (vi) takes corporate action for the purpose of any of the
foregoing; or

 

27

 

(h)           a court or Governmental Authority of competent
jurisdiction enters an order appointing, without consent by the Company or any
of its Subsidiaries, a custodian, receiver, trustee or other officer with
similar powers with respect to it or with respect to any substantial part of
its property, or constituting an order for relief or approving a petition for
relief or reorganization or any other petition in bankruptcy or for liquidation
or to take advantage of any bankruptcy or insolvency law of any jurisdiction,
or ordering the dissolution, winding-up or liquidation of the Company or any of
its Subsidiaries, or any such petition shall be filed against the Company or
any of its Subsidiaries and such petition shall not be dismissed within 60
days; or

 

(i)            a final judgment or judgments for the payment of money
aggregating in excess of $25,000,000 are rendered against one or more of the
Company and its Subsidiaries and which judgments are not, within 45 days after
entry thereof, bonded, discharged or stayed pending appeal, or are not
discharged within 45 days after the expiration of such stay; or

 

(j)            if (i) any Pension Plan shall fail to satisfy the minimum
funding standards of ERISA or the Code for any plan year or part thereof or a
waiver of such standards or extension of any amortization period is sought or
granted under section 412 of the Code, (ii) a notice of intent to terminate any
Pension Plan shall have been or is reasonably expected to be filed with the
PBGC or the PBGC shall have instituted proceedings under ERISA section 4042 to
terminate or appoint a trustee to administer any Pension Plan or the PBGC shall
have notified the Company or any ERISA Affiliate that a Pension Plan may become
a subject of any such proceedings, (iii) the aggregate “amount of unfunded
benefit liabilities” (within the meaning of section 4001(a)(18) of ERISA) under
all Plans, determined in accordance with Title IV of ERISA, shall exceed
$50,000,000, (iv) the Company or any ERISA Affiliate shall have incurred or is
reasonably expected to incur any liability pursuant to Title I or IV of ERISA
or the penalty or excise tax provisions of the Code relating to employee
benefit plans, (v) the Company or any ERISA Affiliate withdraws from any
Multiemployer Plan, or (vi) the Company or any Subsidiary establishes or amends
any employee welfare benefit plan that provides post-employment welfare
benefits in a manner that would increase the liability of the Company or any
Subsidiary thereunder; and any such event or events described in clauses (i)
through (vi) above, either individually or together with any other such event
or events, could reasonably be expected to have a Material Adverse Effect.

 

As
used in Section 11(j), the terms “employee benefit plan”
and “employee welfare benefit plan” shall
have the respective meanings assigned to such terms in section 3 of ERISA.

 

SECTION 12.                                                                     REMEDIES ON DEFAULT, ETC.

 

Section 12.1.              Acceleration.

 

(a)           If an Event of Default with respect to the Company
described in Section 11(g) or (h) (other than an Event of Default described in
clause (i) of Section 11(g) or described in clause (vi) of Section 11(g) by
virtue of the fact that such clause encompasses clause (i) of Section 11(g))
has occurred, all the Notes then outstanding shall automatically become
immediately due and payable.

 

28

 

(b)           If any other Event of Default has occurred and is
continuing, the Majority Holders may at any time at its or their option, by
notice or notices to the Company, declare all the Notes then outstanding to be
immediately due and payable.

 

(c)           If any Event of Default described in Section 11(a) or (b)
has occurred and is continuing, any holder or holders of Notes at the time
outstanding affected by such Event of Default may at any time, at its or their
option, by notice or notices to the Company, declare all the Notes held by it
or them to be immediately due and payable.

 

Upon
any Note becoming due and payable under this Section 12.1, whether
automatically or by declaration, such Note will forthwith mature and the entire
unpaid principal amount of such Note, plus (x) all accrued and unpaid
interest thereon (including, but not limited to, interest accrued thereon at
the Default Rate) and (y) the Make-Whole Amount for a Note of such series
determined in respect of such principal amount (to the full extent permitted by
applicable law), shall all be immediately due and payable, in each and every
case without presentment, demand, protest or further notice, all of which are hereby
waived.  The Company acknowledges, and
the parties hereto agree, that each holder of a Note has the right to maintain
its investment in the Notes free from repayment by the Company (except as
herein specifically provided for) and that the provision for payment of a
Make-Whole Amount by the Company in the event that the Notes are prepaid or are
accelerated as a result of an Event of Default, is intended to provide
compensation for the deprivation of such right under such circumstances.

 

Section 12.2.              Other
Remedies.  If any Default or Event of Default has
occurred and is continuing, and irrespective of whether any Notes have become
or have been declared immediately due and payable under Section 12.1, the
holder of any Note at the time outstanding may proceed to protect and enforce
the rights of such holder by an action at law, suit in equity or other
appropriate proceeding, whether for the specific performance of any agreement
contained herein or in any Note, or for an injunction against a violation of any
of the terms hereof or thereof, or in aid of the exercise of any power granted
hereby or thereby or by law or otherwise.

 

Section 12.3.              Rescission.  At
any time after any Notes have been declared due and payable pursuant to Section
12.1(b) or (c), the Majority Holders, by written notice to the Company, may
rescind and annul any such declaration and its consequences if (a) the Company
has paid all overdue interest on the Notes, all principal of and Make-Whole
Amount, if any, on any Notes that are due and payable and are unpaid other than
by reason of such declaration, and all interest on such overdue principal and
Make-Whole Amount, if any, and (to the extent permitted by applicable law) any
overdue interest in respect of the Notes, at the Default Rate, (b) neither the
Company nor any other Person shall have paid any amounts which have become due
solely by reason of such declaration, (c) all Events of Default and Defaults,
other than non-payment of amounts that have become due solely by reason of such
declaration, have been cured or have been waived pursuant to Section 17, and
(d) no judgment or decree has been entered for the payment of any monies due
pursuant hereto or to the Notes.  No
rescission and annulment under this Section 12.3 will extend to or affect any
subsequent Event of Default or Default or impair any right consequent thereon.

 

Section 12.4.              No
Waivers or Election of Remedies, Expenses, Etc.  No course
of dealing and no delay on the part of any holder of any Note in exercising any
right, power or 

 

29

 

remedy
shall operate as a waiver thereof or otherwise prejudice such holder’s rights,
powers or remedies.  No right, power or
remedy conferred by this Agreement or by any Note upon any holder thereof shall
be exclusive of any other right, power or remedy referred to herein or therein
or now or hereafter available at law, in equity, by statute or otherwise.  Without limiting the obligations of the
Company under Section 15, the Company will pay to the holder of each Note on
demand such further amount as shall be sufficient to cover all costs and
expenses of such holder incurred in any enforcement or collection under this
Section 12, including, without limitation, reasonable attorneys’ fees, expenses
and disbursements.

 

SECTION 13.                                                                     REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.

 

Section 13.1.              Registration
of Notes.  The Company shall keep at its principal
executive office a register for the registration and registration of transfers
of Notes.  The name and address of each
holder of one or more Notes, each transfer thereof and the name and address of
each transferee of one or more Notes shall be registered in such register.  Prior to due presentment for registration of
transfer, the Person in whose name any Note shall be registered shall be deemed
and treated as the owner and holder thereof for all purposes hereof, and the
Company shall not be affected by any notice or knowledge to the contrary.  The Company shall give to any holder of a
Note that is an Institutional Investor promptly upon request therefor, a
complete and correct copy of the names and addresses of all registered holders
of Notes.

 

Section 13.2.              Transfer
and Exchange of Notes.  Upon surrender of any Note to
the Company at the address and to the attention of the designated officer (all
as specified in Section 18(iii)), for registration of transfer or exchange (and
in the case of a surrender for registration of transfer accompanied by a
written instrument of transfer duly executed by the registered holder of such
Note or such holder’s attorney duly authorized in writing and accompanied by
the relevant name, address and other information for notices of each transferee
of such Note or part thereof), within ten Business Days thereafter, the Company
shall execute and deliver, at the Company’s expense (except as provided below),
one or more new Notes of the same series (as requested by the holder thereof)
in exchange therefor, in an aggregate principal amount equal to the unpaid
principal amount of the surrendered Note. 
Each such new Note shall be payable to such Person as such holder may
request and shall be substantially in the form of Exhibit 1.  Each such new Note shall be dated and bear
interest from the date to which interest shall have been paid on the
surrendered Note or dated the date of the surrendered Note if no interest shall
have been paid thereon.  The Company may
require payment of a sum sufficient to cover any stamp tax or governmental
charge imposed in respect of any such transfer of Notes.  Notes shall not be transferred in
denominations of less than $500,000, provided that if necessary to enable the
registration of transfer by a holder of its entire holding of Notes, one Note
may be in a denomination of less than $500,000. 
Any transferee, by its acceptance of a Note registered in its name (or
the name of its nominee), shall be deemed to have made the representations set
forth in Sections 6.1 and 6.2.

 

Section 13.3.              Replacement
of Notes.  Upon receipt by the Company at the address
and to the attention of the designated officer (all as specified in Section
18(iii)) of evidence reasonably satisfactory to it of the ownership of and the
loss, theft, destruction or mutilation of any Note (which evidence shall be, in
the case of an Institutional Investor, notice from such Institutional Investor
of such ownership and such loss, theft, destruction or mutilation), and

 

30

 

(a)           in the case of loss, theft or destruction, of indemnity
reasonably satisfactory to it (provided that if the holder of such Note is, or
is a nominee for, an original Purchaser or any other Institutional Investor,
such Person’s own unsecured agreement of indemnity shall be deemed to be
satisfactory), or

 

(b)           in the case of mutilation, upon surrender and cancellation
thereof,

 

within
ten Business Days thereafter, the Company at its own expense shall execute and
deliver, in lieu thereof, a new Note of the same series, dated and bearing
interest from the date to which interest shall have been paid on such lost,
stolen, destroyed or mutilated Note or dated the date of such lost, stolen,
destroyed or mutilated Note if no interest shall have been paid thereon.

 

SECTION 14.                                                                     PAYMENTS ON NOTES.

 

Section 14.1.              Place
of Payment.  Subject to Section 14.2, payments of
principal, Make-Whole Amount, if any, and interest becoming due and payable on
the Notes shall be made at the principal office of Bank of America, N.A. in New
York City.  The Company may at any time,
by notice to each holder of a Note, change the place of payment of the Notes so
long as such place of payment shall be either the principal office of the
Company in such jurisdiction or the principal office of a bank or trust company
in such jurisdiction.

 

Section 14.2.              Home
Office Payment.  So long as any Purchaser or its nominee shall
be the holder of any Note, and notwithstanding anything contained in Section
14.1 or in such Note to the contrary, the Company will pay all sums becoming
due on such Note for principal, Make-Whole Amount, if any, and interest by the
method and at the address specified for such purpose below such Purchaser’s
name in Schedule A, or by such other method or at such other address as such
Purchaser shall have from time to time specified to the Company in writing for
such purpose, without the presentation or surrender of such Note or the making
of any notation thereon, except that upon written request of the Company made
concurrently with or reasonably promptly after payment or prepayment in full of
any Note, such Purchaser shall surrender such Note for cancellation, reasonably
promptly after any such request, to the Company at its principal executive
office or at the place of payment most recently designated by the Company
pursuant to Section 14.1.  Prior to any
sale or other disposition of any Note held by a Purchaser or its nominee, such
Purchaser will, at its election, either endorse thereon the amount of principal
paid thereon and the last date to which interest has been paid thereon or
surrender such Note to the Company in exchange for a new Note or Notes pursuant
to Section 13.2.  The Company will afford
the benefits of this Section 14.2 to any Institutional Investor that is the
direct or indirect transferee of any Note purchased by a Purchaser under this
Agreement and that has made the same agreement relating to such Note as the
Purchasers have made in this Section 14.2.

 

SECTION 15.                                                                     EXPENSES, ETC.

 

Section 15.1.              Transaction
Expenses.  Whether or not the transactions contemplated
hereby are consummated, the Company will pay all costs and expenses (including
reasonable attorneys’ fees of one special counsel) incurred by the Purchasers
in connection with such transactions and will pay all costs and expenses
(including reasonable attorneys’ fees of one special counsel and, if reasonably
required by the Majority Holders, local or other counsel) of 

 

31

 

each
Purchaser or other holder of a Note in connection with any amendments, waivers
or consents under or in respect of this Agreement or the Notes (whether or not
such amendment, waiver or consent becomes effective), including, without
limitation: (a) the costs and expenses incurred in enforcing or defending
(or determining whether or how to enforce or defend) any rights under this
Agreement or the Notes or in responding to any subpoena or other legal process
or informal investigative demand issued in connection with this Agreement or
the Notes, or by reason of being a holder of any Note, (b) the costs and
expenses, including financial advisors’ fees, incurred in connection with the
insolvency or bankruptcy of the Company or any Subsidiary or in connection with
any work-out or restructuring of the transactions contemplated hereby and by
the Notes and (c) the costs and expenses incurred in connection with the
initial filing of this Agreement and all related documents and financial
information with the SVO, provided
that such costs and expenses under this clause (c) shall not exceed
$3,000.  The Company will pay, and will
save each Purchaser and each other holder of a Note harmless from, all claims
in respect of any fees, costs or expenses, if any, of brokers and finders
(other than those, if any, retained by a Purchaser or other holder in
connection with its purchase of the Notes).

 

Section 15.2.              Survival.  The
obligations of the Company under this Section 15 will survive the payment or
transfer of any Note, the enforcement, amendment or waiver of any provision of
this Agreement or the Notes, and the termination of this Agreement.

 

SECTION 16.                                                                     SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.

 

All
representations and warranties contained herein shall survive the execution and
delivery of this Agreement and the Notes, the purchase or transfer by any
Purchaser of any Note or portion thereof or interest therein and the payment of
any Note, and may be relied upon by any subsequent holder of a Note, regardless
of any investigation made at any time by or on behalf of such Purchaser or any
other holder of a Note.  All statements
contained in any certificate or other instrument delivered by or on behalf of
the Company pursuant to this Agreement shall be deemed representations and
warranties of the Company under this Agreement. 
Subject to the preceding sentence, this Agreement and the Notes embody
the entire agreement and understanding between each Purchaser and the Company
and supersede all prior agreements and understandings relating to the subject
matter hereof.

 

SECTION 17.                                                                     AMENDMENT AND WAIVER.

 

Section 17.1.              Requirements.  This
Agreement and the Notes may be amended, and the observance of any term hereof
or of the Notes may be waived (either retroactively or prospectively), with
(and only with) the written consent of the Company and the Majority Holders,
except that (a) no amendment or waiver of any of the provisions of Section
1, 2, 3, 4, 5, 6 or 21 hereof, or any defined term (as it is used therein),
will be effective as to any Purchaser unless consented to by such Purchaser in
writing, and (b) no such amendment or waiver may, without the written
consent of the holder of each Note at the time outstanding affected thereby,
(i) subject to the provisions of Section 12 relating to acceleration or
rescission, change the amount or time of any prepayment or payment of principal
of, or reduce the rate or change the time of payment or method of computation
of interest or of the Make-Whole Amount on, the 

 

32

 

Notes,
(ii) change the percentage of the principal amount of the Notes the holders
of which are required to consent to any such amendment or waiver, or
(iii) amend any of Sections 8, 11(a), 11(b), 12, 17 or 20.

 

Section 17.2.              Solicitation
of Holders of Notes.

 

(a)           Solicitation.  The Company will provide each holder of the
Notes (irrespective of the amount of Notes then owned by it) with sufficient
information, sufficiently far in advance of the date a decision is required, to
enable such holder to make an informed and considered decision with respect to
any proposed amendment, waiver or consent in respect of any of the provisions
hereof or of the Notes.  The Company will
deliver executed or true and correct copies of each amendment, waiver or
consent effected pursuant to the provisions of this Section 17 to each holder
of outstanding Notes promptly following the date on which it is executed and
delivered by, or receives the consent or approval of, the requisite holders of
Notes.

 

(b)           Payment.  The Company will not directly or indirectly
pay or cause to be paid any remuneration, whether by way of supplemental or
additional interest, fee or otherwise, or grant any security or provide other
credit support, to any holder of Notes as consideration for or as an inducement
to the entering into by any holder of Notes of any waiver or amendment of any
of the terms and provisions hereof unless such remuneration is concurrently
paid, or security is concurrently granted or other credit support concurrently
provided, on the same terms, ratably to each holder of Notes then outstanding
even if such holder did not consent to such waiver or amendment.

 

Section 17.3.              Binding
Effect, etc.  Any amendment or waiver consented to as
provided in this Section 17 applies equally to all holders of Notes and is
binding upon them and upon each future holder of any Note and upon the Company
without regard to whether such Note has been marked to indicate such amendment
or waiver.  No such amendment or waiver
will extend to or affect any obligation, covenant, agreement, Default or Event
of Default not expressly amended or waived or impair any right consequent
thereon.  No course of dealing between
the Company and the holder of any Note nor any delay in exercising any rights
hereunder or under any Note shall operate as a waiver of any rights of any
holder of such Note.  As used herein, the
term “this Agreement” and references thereto shall mean this Agreement as it
may from time to time be amended or supplemented.

 

Section 17.4.              Notes
Held by Company, etc.  Solely for the purpose of determining whether
the holders of the requisite percentage of the aggregate principal amount of
Notes then outstanding approved or consented to any amendment, waiver or
consent to be given under this Agreement or the Notes, or have directed the
taking of any action provided herein or in the Notes to be taken upon the
direction of the holders of a specified percentage of the aggregate principal
amount of Notes then outstanding, Notes directly or indirectly owned by the
Company or any of its Affiliates shall be deemed not to be outstanding.

 

SECTION 18.                                                                     NOTICES.

 

Except
as otherwise provided in Sections 7.1(a), 7.1(b), 7.1(c) and 7.1(f), all
notices and communications provided for hereunder shall be in writing and sent
(a) by telecopy if the sender 

 

33

 

on
the same day sends a confirming copy of such notice by a recognized overnight
delivery service (charges prepaid), or (b) by registered or certified mail
with return receipt requested (postage prepaid), or (c) by a recognized
overnight delivery service (with charges prepaid).  Any such notice must be sent:

 

(i)            if to any Purchaser or its nominee,
to such Purchaser or nominee at the address specified for such communications
in Schedule A, or at such other address as such Purchaser or nominee shall have
specified to the Company in writing,

 

(ii)           if to any other holder of any Note,
to such holder at such address as such other holder shall have specified to the
Company in writing, or

 

(iii)          if to the Company, to the Company at
its address set forth at the beginning hereof to the attention of Wendy J.
Hills, Esq., Vice President, Secretary and Associate General Counsel
(telecopier:  (913) 236-2627), or at such
other address as the Company shall have specified to the holder of each Note in
writing.

 

Notices
under this Section 18 will be deemed given only when actually received.

 

SECTION 19.                                                                     REPRODUCTION OF DOCUMENTS.

 

This
Agreement and all documents relating thereto, including, without limitation,
(a) consents, waivers and modifications that may hereafter be executed, (b)
documents received by any Purchaser at the Closing (except the Notes
themselves), and (c) financial statements, certificates and other information
previously or hereafter furnished to any Purchaser, may be reproduced by such
Purchaser by any photographic, photostatic, electronic, digital, or other
similar process and such Purchaser may destroy any original document so
reproduced.  The Company agrees and
stipulates that, to the extent permitted by applicable law, any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by such Purchaser in
the regular course of business) and any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in
evidence.  This Section 19 shall not
prohibit the Company or any other holder of Notes from contesting any such
reproduction to the same extent that it could contest the original, or from
introducing evidence to demonstrate the inaccuracy of any such reproduction.

 

SECTION 20.                                                                     CONFIDENTIAL INFORMATION.

 

For
the purposes of this Section 20, “Confidential Information” means information
delivered to any Purchaser by or on behalf of the Company or any Subsidiary in
connection with the transactions contemplated by or otherwise pursuant to this
Agreement that is proprietary in nature and that was clearly marked or labeled
or otherwise adequately identified when received by such Purchaser as being
confidential information of the Company or such Subsidiary, provided that such
term does not include information that (a) was publicly known prior to the
time of such disclosure, (b) subsequently becomes publicly known through
no act or omission by such Purchaser or any person acting on such Purchaser’s
behalf, (c) otherwise becomes known to such Purchaser other than through
disclosure by the Company or any Subsidiary, or (d) constitutes financial
statements delivered to such Purchaser under Section 7.1 that are 

 

34

 

otherwise
publicly available.  Each Purchaser will
maintain the confidentiality of such Confidential Information in accordance
with procedures adopted by such Purchaser in good faith to protect confidential
information of third parties delivered to such Purchaser, provided that such
Purchaser may deliver or disclose Confidential Information to (i) its
directors, officers, employees, agents, attorneys, trustees and affiliates (to the
extent such disclosure reasonably relates to the administration of the
investment represented by its Notes), (ii) its financial advisors and
other professional advisors who agree to hold confidential the Confidential
Information substantially in accordance with the terms of this Section 20,
(iii) any other holder of any Note, (iv) any Institutional Investor
to which it sells or offers to sell such Note or any part thereof or any
participation therein (if such Person has agreed in writing prior to its receipt
of such Confidential Information to be bound by the provisions of this Section
20), (v) any Person from which it offers to purchase any security of the
Company (if such Person has agreed in writing prior to its receipt of such
Confidential Information to be bound by the provisions of this Section 20),
(vi) any federal or state regulatory authority having jurisdiction over
such Purchaser, (vii) the NAIC or the SVO or, in each case, any similar
organization, or any nationally recognized rating agency that requires access
to information about such Purchaser’s investment portfolio, or (viii) any
other Person to which such delivery or disclosure may be necessary (w) to
effect compliance with any law, rule, regulation or order applicable to such
Purchaser, (x) in response to any subpoena or other legal process,
(y) in connection with any litigation to which such Purchaser is a party
or (z) if an Event of Default has occurred and is continuing, to the
extent such Purchaser may reasonably determine such delivery and disclosure to
be necessary or appropriate in the enforcement or for the protection of the
rights and remedies under such Purchaser’s Notes and this Agreement.  Each holder of a Note, by its acceptance of a
Note, will be deemed to have agreed to be bound by and to be entitled to the
benefits of this Section 20 as though it were a party to this Agreement.  On reasonable request by the Company in
connection with the delivery to any holder of a Note of information required to
be delivered to such holder under this Agreement or requested by such holder
(other than a holder that is a party to this Agreement or its nominee), such
holder will enter into an agreement with the Company embodying the provisions
of this Section 20.

 

SECTION 21.                                                                     SUBSTITUTION OF PURCHASER.

 

Each
Purchaser shall have the right to substitute any one of its Affiliates as the
purchaser of the Notes that it has agreed to purchase hereunder, by written
notice to the Company, which notice shall be signed by both such Purchaser and
such Affiliate, shall contain such Affiliate’s agreement to be bound by this
Agreement and shall contain a confirmation by such Affiliate of the accuracy
with respect to it of the representations set forth in Section 6.  Upon receipt of such notice, any reference to
such Purchaser in this Agreement (other than in this Section 21), shall be
deemed to refer to such Affiliate in lieu of such original Purchaser.  In the event that such Affiliate is so
substituted as a Purchaser hereunder and such Affiliate thereafter transfers to
such original Purchaser all of the Notes then held by such Affiliate, upon
receipt by the Company of notice of such transfer, any reference to such
Affiliate as a “Purchaser” in this Agreement (other than in this Section 21),
shall no longer be deemed to refer to such Affiliate, but shall refer to such
original Purchaser, and such original Purchaser shall again have all the rights
of an original holder of the Notes under this Agreement.

 

35

 

SECTION 22.                                                                     MISCELLANEOUS.

 

Section 22.1.              Successors
and Assigns.  All covenants and other agreements contained
in this Agreement by or on behalf of any of the parties hereto bind and inure
to the benefit of their respective successors and assigns (including, without
limitation, any subsequent holder of a Note) whether so expressed or not.

 

Section 22.2.              Payments
Due on Non-Business Days.  Anything in this Agreement or
the Notes to the contrary notwithstanding (but without limiting the requirement
in Section 8.2 that the notice of any optional prepayment specify a
Business Day as the date fixed for such prepayment), any payment of principal
of or Make-Whole Amount or interest on any Note that is due on a date other
than a Business Day shall be made on the next succeeding Business Day without
including the additional days elapsed in the computation of the interest
payable on such next succeeding Business Day; provided
that if the maturity date of any Note is a date other than a Business Day, the
payment otherwise due on such maturity date shall be made on the next
succeeding Business Day and shall include the additional days elapsed in the
computation of interest payable on such next succeeding Business Day.

 

Section 22.3.              Accounting
Terms; Changes in GAAP.  All accounting terms used
herein which are not expressly defined in this Agreement have the meanings
respectively given to them in accordance with GAAP.  Except as otherwise specifically provided
herein, (a) all computations made pursuant to this Agreement shall be made
in accordance with GAAP, and (b) all financial statements shall be
prepared in accordance with GAAP.

 

If
at any time after the date of this Agreement there is a change to the basis on
which the Company’s financial statements are prepared (an “Accounting
Change”), the Company and the holders of Notes shall, at the request
of the Company or the Majority Holders, negotiate in good faith with a view to
agreeing on such amendments to the financial covenants set forth in Section 10.1
and/or the related defined terms as may be necessary, after giving effect to
the Accounting Change, to provide to the holders of the Notes protection
comparable to that provided on the date of this Agreement.  Any such amendments shall take effect on the
effective date specified in the writing executed by the Company and the
Majority Holders to reflect such amendments in accordance with Section 17.  If the Company and the Majority Holders are
unable agree on such amendments within 90 days after the date of the applicable
Accounting Change, the Company shall request that its independent public
accountants prepare a certificate which sets forth the amendments to such
financial covenants and defined terms as are needed to place the Company and
the holders of the Notes in the same respective positions as they would have
been had such Accounting Change not occurred. 
Such certificate shall, in the absence of manifest error, be binding on
all of the parties hereto.

 

Section 22.4.              Severability.  Any
provision of this Agreement that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall (to the full extent permitted by law) not invalidate or
render unenforceable such provision in any other jurisdiction.

 

36

 

Section 22.5.              Construction, etc.  Each
covenant contained herein shall be construed (absent express provision to the
contrary) as being independent of each other covenant contained herein, so that
compliance with any one covenant shall not (absent such an express contrary
provision) be deemed to excuse compliance with any other covenant.  Where any provision herein refers to action
to be taken by any Person, or which such Person is prohibited from taking, such
provision shall be applicable whether such action is taken directly or
indirectly by such Person.

 

For
the avoidance of doubt, all Schedules and Exhibits attached to this Agreement
shall be deemed to be a part hereof.

 

Section 22.6.              Counterparts.  This
Agreement may be executed in any number of counterparts, each of which shall be
an original but all of which together shall constitute one instrument.  Each counterpart may consist of a number of
copies hereof, each signed by less than all, but together signed by all, of the
parties hereto.

 

Section 22.7.              Governing
Law.  This Agreement shall be construed and enforced
in accordance with, and the rights of the parties shall be governed by, the law
of the State of New York excluding choice of law principles of the law of such
State that would permit the application of the laws of a jurisdiction other
than such State.

 

Section 22.8.              Jurisdiction
and Process; Waiver of Jury Trial.  (a) 
The Company irrevocably submits to the non-exclusive jurisdiction of any New
York State or federal court sitting in the Borough of Manhattan, The City of
New York, over any suit, action or proceeding arising out of or relating to
this Agreement or the Notes.  To the
fullest extent permitted by applicable law, the Company irrevocably waives and
agrees not to assert, by way of motion, as a defense or otherwise, any claim
that it is not subject to the jurisdiction of any such court, any objection
that it may now or hereafter have to the laying of the venue of any such suit,
action or proceeding brought in any such court and any claim that any such
suit, action or proceeding brought in any such court has been brought in an
inconvenient forum.

 

(b)           The Company consents to process being served by or on
behalf of any holder of Notes in any suit, action or proceeding of the nature
referred to in Section 22.8(a) by mailing a copy thereof by registered
or certified mail (or any substantially similar form of mail), postage prepaid,
return receipt requested, to it at its address specified in Section 18 or
at such other address of which such holder shall then have been notified
pursuant to said Section.  The Company
agrees that such service upon receipt (i) shall be deemed in every respect
effective service of process upon it in any such suit, action or proceeding and
(ii) shall, to the fullest extent permitted by applicable law, be taken
and held to be valid personal service upon and personal delivery to it.  Notices hereunder shall be conclusively
presumed received as evidenced by a delivery receipt furnished by the United
States Postal Service or any reputable commercial delivery service.

 

(c)           Nothing in this Section 22.8 shall affect the right
of any holder of a Note to serve process in any manner permitted by law, or
limit any right that the holders of any of the Notes may have to bring
proceedings against the Company in the courts of any appropriate jurisdiction 

 

37

 

or to enforce in any lawful manner a judgment
obtained in one jurisdiction in any other jurisdiction.

 

(d)           THE PARTIES HERETO HEREBY WAIVE TRIAL BY JURY IN ANY
ACTION BROUGHT ON OR WITH RESPECT TO THIS AGREEMENT, THE NOTES OR ANY OTHER
DOCUMENT EXECUTED IN CONNECTION HEREWITH OR THEREWITH.

 

*    *   
*    *    *

 

38

 

If
you are in agreement with the foregoing, please sign the form of agreement in
the space below provided on a counterpart of this Agreement and return it to
the Company, whereupon this Agreement shall become a binding agreement between
you and the Company.

 

	
   

  	
  Very
  truly yours,

  
	
   

  	
   

  
	
   

  	
  WADDELL &
  REED FINANCIAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Daniel P. Connealy

  
	
   

  	
  Name:
  Daniel P. Connealy

  
	
   

  	
  Title:
  Senior Vice President and Chief Financial Officer

  

 

[Signature page to Waddell & Reed Financial, Inc. Note Purchase
Agreement]

 

 

This
Agreement is hereby accepted and 

agreed to as of the date thereof.

 

 

METROPOLITAN LIFE INSURANCE COMPANY

 

METLIFE INVESTORS INSURANCE COMPANY

 

by Metropolitan Life Insurance Company,

its Investment Manager

 

METLIFE INSURANCE COMPANY OF CONNECTICUT

 

by
Metropolitan Life Insurance Company,

its
Investment Manager

 

 

	
  By:

  	
  /s/ Judith A. Gulotta

  	
   

  
	
  Name:

  	
  Judith
  A. Gulotta

  	
   

  
	
  Title:

  	
  Managing
  Director

  	
   

  

 

[Signature page to Waddell & Reed Financial,
Inc. Note Purchase Agreement]

 

 

This
Agreement is hereby accepted and 

agreed to as of the date thereof.

 

 

MIDLAND
NATIONAL LIFE INSURANCE COMPANY

By:  Guggenheim Partners Asset Management, LLC

 

 

	
  By:

  	
  /s/
  Michael Damaso

  	
   

  
	
  Name:
  

  	
  Michael
  Damaso

  	
   

  
	
  Title:

  	
  Senior
  Managing Director

  	
   

  

 

[Signature page to Waddell & Reed Financial,
Inc. Note Purchase Agreement]

 

 

This
Agreement is hereby accepted and 

agreed to as of the date thereof.

 

 

NORTH
AMERICAN COMPANY FOR LIFE AND HEALTH INSURANCE

By:  Guggenheim Partners Asset Management, LLC

 

 

	
  By:

  	
  /s/ Michael Damaso

  	
   

  
	
  Name:

  	
  Michael
  Damaso

  	
   

  
	
  Title:

  	
  Senior
  Managing Director

  	
   

  

 

[Signature page to Waddell & Reed Financial,
Inc. Note Purchase Agreement]

 

 

This
Agreement is hereby accepted and 

agreed to as of the date thereof.

 

 

SECURITY
BENEFIT LIFE INSURANCE COMPANY

By:  Guggenheim Partners Asset Management, LLC

 

 

	
  By:

  	
  /s/ Michael Damaso

  	
   

  
	
  Name:

  	
  Michael
  Damaso

  	
   

  
	
  Title:

  	
  Senior
  Managing Director

  	
   

  

 

[Signature page to Waddell & Reed Financial,
Inc. Note Purchase Agreement]

 

 

This
Agreement is hereby accepted and 

agreed to as of the date thereof.

 

 

WILTON
REASSURANCE COMPANY

By:  Guggenheim Partners Asset Management, LLC

 

 

	
  By:

  	
  /s/ Michael Damaso

  	
   

  
	
  Name:

  	
  Michael
  Damaso

  	
   

  
	
  Title:

  	
  Senior
  Managing Director

  	
   

  

 

[Signature page to Waddell & Reed Financial,
Inc. Note Purchase Agreement]

 

 

This
Agreement is hereby accepted and 

agreed to as of the date thereof.

 

 

GENWORTH
LIFE INSURANCE COMPANY

 

 

	
  By:

  	
  /s/ John R. Endres

  	
   

  
	
  Name:

  	
  John
  R. Endres

  	
   

  
	
  Title:

  	
  Investment Officer

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  GENWORTH LIFE AND ANNUITY
  INSURANCE COMPANY

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ John R. Endres

  	
   

  
	
  Name:

  	
  John
  R. Endres

  	
   

  
	
  Title:

  	
  Investment Officer

  	
   

  

 

[Signature page to Waddell & Reed Financial, Inc. Note Purchase
Agreement]

 

 

This
Agreement is hereby accepted and 

agreed to as of the date thereof.

 

 

JOHN
HANCOCK LIFE INSURANCE

COMPANY (U.S.A.)

 

 

	
  By:

  	
  /s/ John M. Garrison  

  	
   

  

Name:  John M. Garrison

Title:   
Managing Director

 

 

JOHN
HANCOCK LIFE INSURANCE 

COMPANY OF NEW YORK

 

 

	
  By:

  	
  /s/ John M. Garrison

  	
   

  

Name:  John M. Garrison

Title:    Authorized Signatory

 

[Signature page to Waddell & Reed Financial, Inc. Note Purchase
Agreement]

 

 

This
Agreement is hereby accepted and 

agreed to as of the date thereof.

 

 

JPMORGAN
CHASE BANK, N.A., not

individually but solely in its capacity as

Directed Trustee of the SBC Master Pension Trust

 

 

	
  By:

  	
  /s/
  Barry O’Connor

  	
   

  

Name:  Barry O’Connor

Title:    Executive Director

 

[Signature page to Waddell & Reed Financial, Inc. Note Purchase
Agreement]

 

 

This
Agreement is hereby accepted and 

agreed to as of the date thereof.

 

 

THE
NORTHWESTERN MUTUAL 

LIFE INSURANCE COMPANY

 

 

	
  By:

  	
  /s/
  Randal W. Ralph 

  	
   

  

Name:  Randal W. Ralph

Title:    Its Authorized Representative

 

[Signature page to Waddell & Reed Financial, Inc. Note Purchase
Agreement]

 

 

This
Agreement is hereby accepted and 

agreed to as of the date thereof.

 

 

KNIGHTS
OF COLUMBUS

 

 

	
  By:

  	
  /s/
  Donald R. Kehoe 

  	
   

  

Name:  Donald R. Kehoe

Title:    Supreme Secretary

 

[Signature page to Waddell & Reed Financial, Inc. Note Purchase
Agreement]

 

 

This
Agreement is hereby accepted and 

agreed to as of the date thereof.

 

 

THE
UNION CENTRAL LIFE INSURANCE COMPANY

 

By:  Summit Investment Advisors, Inc., as
Agent

 

 

	
  By:

  	
  /s/  Andrew
  S. White

  	
   

  

Name:  Andrew S. White

Title:   
Managing Director - Private Placements

 

 

ACACIA
LIFE INSURANCE COMPANY

 

By:  Summit Investment Advisors, Inc., as
Agent

 

 

	
  By:

  	
  /s/ Andrew S. White

  	
   

  

Name:  Andrew S. White

Title:   
Managing Director - Private Placements

 

 

AMERITAS
LIFE INSURANCE CORP.

 

By:  Summit Investment Advisors, Inc., as
Agent

 

 

	
  By:

  	
  /s/  Andrew
  S. White

  	
   

  

Name:  Andrew S. White

Title:   
Managing Director - Private Placements

 

[Signature page to Waddell & Reed Financial, Inc. Note Purchase
Agreement]

 

 

SCHEDULE A

 

INFORMATION RELATING TO PURCHASERS

 

This
Schedule A shows the names and addresses of the Purchasers under the foregoing
Note Purchase Agreement and the respective principal amounts and series of
Notes to be purchased by each.

 

 

	
  Name and Address of Purchaser

  	
   

  	
  Principal Amount and Series of

  Notes to be Purchased

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Series A

  
	
   

  	
   

  	
   

  
	
  METROPOLITAN
  LIFE INSURANCE COMPANY

  	
   

  	
  $14,000,000

  

 

METROPOLITAN
LIFE INSURANCE COMPANY

1095 Avenue of the Americas

New York, New York  10036

 

(Securities to be registered in the name of Metropolitan
Life Insurance Company)

 

(1)                                  All notices and
communications (other than as provided in (2) below):

 

	
  Metropolitan
  Life Insurance Company

  
	
  Investments,
  Private Placements

  
	
  P.O. Box
  1902

  
	
  10
  Park Avenue

  
	
  Morristown,
  New Jersey 07962-1902

  
	
  Attention:
  Director

  
	
  Facsimile
  (973) 355-4250

  

 

2

 

With a copy OTHER than with respect to deliveries of financial
statements to:

 

Metropolitan Life Insurance Company

P.O. Box 1902

10 Park Avenue

Morristown, New Jersey 07962-1902

Attention: Chief Counsel-Securities Investments (PRIV)

Email:  sec_invest_law@metlife.com

 

(2)                                  Electronic mail address for
electronic delivery of information for purposes of Sections 7.1(a), 7.1(b), 7.1(c) and
7.1(f) of the Note Purchase Agreement:

 

PPUcompliance@MetLife.com

 

(3)                                  Original notes delivered to:

 

Metropolitan Life Insurance Company

Securities Investments, Law Department

P.O. Box 1902

10 Park Avenue

Morristown, New Jersey 07962-1902

Attention:  Daniel F. Scudder, Esq.

 

3

 

	
  Name and Address of Purchaser

  	
   

  	
  Principal Amount and Series of

  Notes to be Purchased

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Series A

  
	
   

  	
   

  	
   

  
	
  METLIFE
  INSURANCE COMPANY  OF CONNECTICUT,
  on behalf of its Separate Account MGA

  	
   

  	
  $20,000,000

  

 

METLIFE
INSURANCE COMPANY OF CONNECTICUT  

c/o Metropolitan Life Insurance Company

1095 Avenue of the Americas

New York, New York  10036

 

(Securities to be registered in the name of MetLife Insurance Company of Connecticut, 

on behalf of its Separate
Account MGA)

 

(1)           All notices and communications (other
than as provided in (2) below):

 

MetLife Insurance Company of Connecticut 

c/o Metropolitan Life Insurance Company

Investments, Private Placements

P.O. Box 1902

10 Park Avenue

Morristown, New Jersey 07962-1902

Attention:  Director

Facsimile:  (973) 355-4250

 

4

 

With a copy OTHER than with respect to deliveries of financial
statements to:

 

MetLife
Insurance Company of Connecticut 

c/o Metropolitan Life Insurance Company

P.O. Box 1902

10 Park Avenue

Morristown, New Jersey 07962-1902

Attention:  Chief Counsel-Securities
Investments (PRIV)

 

Email:  sec_invest_law@metlife.com

 

(2)                                  Electronic mail address for
electronic delivery of information for purposes of Sections 7.1(a), 7.1(b), 7.1(c) and
7.1(f) of the Note Purchase Agreement:

 

PPUcompliance@MetLife.com

 

(3)           Original notes delivered to:

 

MetLife Insurance Company of Connecticut 

c/o Metropolitan Life Insurance Company

Securities Investments, Law Department

P.O. Box 1902

10 Park Avenue

Morristown, New Jersey 07962-1902

Attention:  Daniel F. Scudder, Esq.

 

5

 

	
  Name and Address of Purchaser

  	
   

  	
  Principal Amount and
  Series of

  Notes to be Purchased

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Series B

  
	
   

  	
   

  	
   

  
	
  METROPOLITAN LIFE INSURANCE COMPANY

  	
   

  	
  $10,000,000

  

 

METROPOLITAN LIFE INSURANCE COMPANY

1095 Avenue of the Americas

New York, New York  10036

 

(Securities to be registered in the name of Metropolitan Life Insurance Company)

 

(1)           All notices and
communications (other than as provided in (2) below):

 

Metropolitan Life Insurance Company

Investments, Private Placements

P.O. Box 1902

10 Park Avenue

Morristown, New Jersey 07962-1902

Attention:  Director

Facsimile:  (973) 355-4250

 

6

 

With a copy OTHER than with respect to deliveries of financial
statements to:

 

Metropolitan Life Insurance Company

P.O. Box 1902

10 Park Avenue

Morristown, New Jersey 07962-1902

Attention: Chief Counsel-Securities Investments (PRIV)

 

Email: 
sec_invest_law@metlife.com

 

(2)           Electronic mail
address for electronic delivery of information for purposes of Sections 7.1(a),
7.1(b), 7.1(c) and 7.1(f) of the Note Purchase Agreement:

 

PPUcompliance@MetLife.com

 

(3)           Original notes
delivered to:

 

Metropolitan Life Insurance Company

Securities Investments, Law Department

P.O. Box 1902

10 Park Avenue

Morristown, New Jersey 07962-1902

Attention:  Daniel F. Scudder, Esq.

 

7

 

	
  Name and Address of Purchaser

  	
   

  	
  Principal Amount and
  Series of

  Notes to be Purchased

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Series B

  
	
   

  	
   

  	
   

  
	
  METLIFE INVESTORS INSURANCE COMPANY

  	
   

  	
  $1,500,000

  

 

METLIFE INVESTORS INSURANCE COMPANY

c/o Metropolitan Life Insurance Company

1095 Avenue of the Americas

New York, New York  10036

 

(Securities to be registered in the name of MetLife Investors Insurance Company)

 

(1)           All notices and
communications (other than as provided in (2) below):

 

MetLife Investors Insurance Company

c/o Metropolitan Life Insurance Company

Investments, Private Placements

P.O. Box 1902

10 Park Avenue

Morristown, New Jersey 07962-1902

Attention:  Director

Facsimile:  (973) 355-4250

 

8

 

With a copy OTHER than with respect to deliveries of financial
statements to:

 

MetLife Investors Insurance Company

c/o Metropolitan Life Insurance Company

P.O. Box 1902

10 Park Avenue

Morristown, New Jersey 07962-1902

Attention: Chief Counsel-Securities Investments (PRIV)

Email:  sec_invest_law@metlife.com

 

(2)           Electronic mail
address for electronic delivery of information for purposes of Sections 7.1(a),
7.1(b), 7.1(c) and 7.1(f) of the Note Purchase Agreement:

 

PPUcompliance@MetLife.com

 

(3)           Original notes
delivered to:

 

MetLife Investors Insurance Company

c/o Metropolitan Life Insurance Company

Securities Investments, Law Department

P.O. Box 1902

10 Park Avenue

Morristown, New Jersey 07962-1902

Attention:  Daniel F. Scudder, Esq.

 

9

 

	
  Name and Address of Purchaser

  	
   

  	
  Principal Amount and
  Series of

  Notes to be Purchased

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Series B

  
	
   

  	
   

  	
   

  
	
  METLIFE INSURANCE COMPANY OF CONNECTICUT

  	
   

  	
  $3,500,000

  

 

METLIFE INSURANCE COMPANY OF CONNECTICUT

c/o Metropolitan Life Insurance Company

1095 Avenue of the Americas

New York, New York  10036

 

(Securities to be registered in the name of MetLife  Insurance Company of
Connecticut)

 

(1)           All notices and
communications (other than as provided in (2) below):

 

MetLife Insurance Company of Connecticut

c/o Metropolitan Life Insurance Company

Investments, Private Placements

P.O. Box 1902

10 Park Avenue

Morristown, New Jersey 07962-1902

Attention:  Director

Facsimile: (973) 355-4250

 

10

 

With a copy OTHER than with respect to deliveries of financial
statements to:

 

MetLife Insurance Company of Connecticut

c/o Metropolitan Life Insurance Company

P.O. Box 1902

10 Park Avenue

Morristown, New Jersey 07962-1902

Attention: Chief Counsel-Securities Investments (PRIV)

 

Email: 
sec_invest_law@metlife.com

 

(2)           Electronic mail
address for electronic delivery of information for purposes of Sections 7.1(a),
7.1(b), 7.1(c) and 7.1(f) of the Note Purchase Agreement:

 

PPUcompliance@MetLife.com

 

(3)           Original notes
delivered to:

 

MetLife Insurance Company of Connecticut

c/o Metropolitan Life Insurance Company

Securities Investments, Law Department

10 Park Avenue

Morristown, New Jersey 07962-1902

Attention:  Daniel F. Scudder, Esq.

 

11

 

	
  Name and Address of Purchaser

  	
   

  	
  Principal Amount and
  Series of

  Notes to be Purchased

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Series B

  
	
   

  	
   

  	
   

  
	
  MIDLAND NATIONAL LIFE INSURANCE COMPANY

  	
   

  	
  $22,500,000

  

 

(1)       Address for all
notices relating to payments:

 

Midland National Life Insurance Company

c/o Guggenheim Partners

227 W. Monroe St. 48th Floor

Chicago, IL 60606

Attn:  Melissa Carlson

	
  Phone:

  	
  312-827-0192

  
	
  Fax:

  	
  201-215-9353

  
	
  Email:

  	
  gpambackoffice@guggenheimpartners.com

  

 

(2)       Address for all
other communications and notices (other than as provided in (3) below):

 

Guggenheim Partners

135 E. 57th St., 6th Floor

New York, NY 10022

Attn:  Kaitlin Trinh/Mabel Chui

	
  Phone:

  	
  212-651-0840

  
	
  Fax:

  	
  212-644-8396

  
	
  E-mail:

  	
  kaitlin.trinh@guggenheimpartners.com

  

 

12

 

(3)       Electronic mail
address for electronic delivery of information for purposes of Sections 7.1(a),
7.1(b), 7.1(c) and 7.1(f) of the Note Purchase Agreement:

 

kaitlin.trinh@guggenheimpartners.com

 

13

 

	
  Name and Address of Purchaser

  	
   

  	
  Principal Amount and Series of

  Notes to be Purchased

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Series B

  
	
   

  	
   

  	
   

  
	
  NORTH AMERICAN COMPANY FOR LIFE AND HEALTH
  INSURANCE

  	
   

  	
  $13,000,000

  

 

(1)       Address for all
notices relating to payments:

 

North American Company for Life and Health Insurance

c/o Guggenheim Partners

227 W. Monroe St. 48th Floor

Chicago, IL 60606

Attn: Melissa Carlson

	
  Phone:

  	
  312-827-0192

  
	
  Fax:

  	
  201-215-9354

  
	
  Email:

  	
  gpambackoffice@guggenheimpartners.com

  

 

(2)       Address for all
other communications and notices (other than as provided in (3) below):

 

Guggenheim Partners

135 E. 57th St., 6th Floor

New York, NY 10022

Attn: Kaitlin Trinh/Mabel Chui

	
  Phone:

  	
  212-651-0840

  
	
  Fax:

  	
  212-644-8396

  
	
  E-mail:

  	
  kaitlin.trinh@guggenheimpartners.com

  

 

14

 

(3)       Electronic mail
address for electronic delivery of information for purposes of Sections 7.1(a),
7.1(b), 7.1(c) and 7.1(f) of the Note Purchase Agreement:

 

kaitlin.trinh@guggenheimpartners.com

 

15

 

	
  Name and Address of Purchaser

  	
   

  	
  Principal Amount and Series of

  Notes to be Purchased

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Series B

  
	
   

  	
   

  	
   

  
	
  SECURITY BENEFIT LIFE INSURANCE COMPANY

  	
   

  	
  $8,500,000

  

 

(1)       Address for all
notices relating to payments:

 

Guggenheim Partners Asset Management, Inc.

227 W. Monroe Street - Suite 4900

Chicago, IL 60606

Attn: Maureen Moster

Tel:      312-873-1477

Fax:      312-827-0157

 

16

 

(2)       Address for all
other communications and notices (other than as provided in (3) below):

 

Guggenheim Partners

135 E. 57th St., 6th Floor

New York, NY 10022

Attn: Kaitlin Trinh/Mabel Chui

Phone:       212-651-0840

Fax:             212-644-8396

E-mail:            kaitlin.trinh@guggenheimpartners.com

 

(3)       Electronic mail
address for electronic delivery of information for purposes of Sections 7.1(a),
7.1(b), 7.1(c) and 7.1(f) of the Note Purchase Agreement:

 

kaitlin.trinh@guggenheimpartners.com

 

17

 

	
  Name and Address of Purchaser

  	
   

  	
  Principal Amount and Series of

  Notes to be Purchased

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Series B

  
	
   

  	
   

  	
   

  
	
  WILTON REASSURANCE COMPANY

  	
   

  	
  $1,000,000

  

 

 

(1)       Address for all
notices relating to payments:

 

C/O The Bank of New York

F/A/O:

P.O. Box 19266

Newark, NJ 07195

Attn: Principal & Interest Dept

 

In addition, it is requested that duplicate
correspondence be sent to:

 

Guggenheim Partners Asset
Management, Inc.

227 W. Monroe Street - Suite 4900

Chicago, IL 60606

Attn: Maureen Moster 

Tel:        312-873-1477

Fax:         312-827-0157

 

18

 

(2)       Address for all
other communications and notices (other than as provided in (3) below):

 

Guggenheim Partners

135 E. 57th St., 6th Floor

New York, NY 10022

Attn: Kaitlin Trinh/Mabel Chui

Phone:       212-651-0840

Fax:             212-644-8396

E-mail:            kaitlin.trinh@guggenheimpartners.com

 

(3)       Electronic mail
address for electronic delivery of information for purposes of Sections 7.1(a),
7.1(b), 7.1(c) and 7.1(f) of the Note Purchase Agreement:

 

kaitlin.trinh@guggenheimpartners.com

 

19

 

	
  Name and Address of Purchaser

  	
   

  	
  Principal Amount and Series of 

  Notes to be Purchased

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Series A

  
	
   

  	
   

  	
   

  
	
  GENWORTH LIFE AND ANNUITY INSURANCE COMPANY I/N/O
  HARE & CO.

  	
   

  	
  $5,000,000

  

 

(1)           All notices and
communications including original note agreement, conformed copy of the note
agreement, amendment requests, financial statements and other general
information to be addressed as follows (other than as provided in (2) below):

 

Genworth Financial, Inc.

Account:  Genworth Life and Annuity Insurance Company

3001 Summer Street, 2nd
Floor

Stamford, CT  06905

Attn:  Dorothy Michalowski

	
  Telephone No:

  	
  (212) 895-4031

  
	
  Fax No:

  	
  (866) 745-0947

  

 

If available, an electronic copy is additionally
requested.  Please send to the following
e-mail address:  GNW.privateplacements@genworth.com

 

20

 

(2)           Electronic mail
address for electronic delivery of

information for purposes of Sections 7.1(a), 7.1(b), 

7.1(c) and 7.1(f) of the Note Purchase Agreement:

 

GNW.privateplacements@genworth.com

 

(3)           All corporate actions, including payments and prepayments,
should be sent to the above address with copies to:

 

Genworth Financial, Inc.

Account: 
Genworth Life and Annuity Insurance Company

3001 Summer Street

Stamford, CT 
06905

Attn:  Trade
Operations

	
  Telephone No:

  	
  (203) 708-3368

  
	
  Fax No:

  	
  (866) 745-3305

  

 

If available, an electronic copy
is additionally requested.  Please send to
the following e-mail address:  GNWInvestmentsOperations@genworth.com

 

(4)           Notices with
respect to payments and written confirmation of each such payment, including
interest payments, redemptions, premiums, make wholes, and fees should also be
addressed as above with additional copies addressed to the following:

 

The Bank of New York

Income Collection Department

P.O. Box 19266

Newark, NJ  07195

	
  Attn:

  	
  PP P&I Department

  
	
  Ref:

  	
  GLAIC

  	
  ,

  	
  CUSIP/PPN & Security Description

  
	
  P&I Contact:

  	
  Purisima Teylan - (718) 315-3035

  

 

(5)           Physical
Delivery of the Notes:

 

The Bank of New York

One Wall Street

Window A, 3rd Floor

New York, NY  10286

 

	
  Register In Nominee Name:

  	
  HARE & CO.

  

 

21

 

	
  Name and Address of Purchaser

  	
   

  	
  Principal Amount and Series of

  Notes to be Purchased

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Series B

  
	
   

  	
   

  	
   

  
	
  GENWORTH LIFE INSURANCE COMPANY I/N/O
  HARE & CO.

  	
   

  	
  $25,000,000

  

 

(1)           All notices and
communications including original note agreement, conformed copy of the note
agreement, amendment requests, financial statements and other general
information to be addressed as follows (other than as provided in (2) below):

 

Genworth Financial, Inc.

Account:  Genworth Life Insurance Company

3001 Summer Street, 2nd
Floor

Stamford, CT  06905

Attn:  Dorothy Michalowski

	
  Telephone No

  	
  (212) 895-4031

  
	
  Fax No:

  	
  (866) 745-0947

  

 

If available, an electronic copy
is additionally requested.  Please send
to the following e-mail address:  GNW.privateplacements@genworth.com

 

(2)           Electronic mail
address for electronic delivery of information for purposes of Sections 7.1(a),
7.1(b), 7.1(c) and 7.1(f) of the Note Purchase Agreement:

 

GNW.privateplacements@genworth.com

 

22

 

(3)           All corporate actions, including payments and prepayments,
should be sent to the above address with copies to:

 

Genworth Financial, Inc.

Account:  Genworth Life Insurance Company

3001 Summer Street

Stamford, CT  06905

Attn:  Trade Operations

	
  Telephone No:

  	
  (203) 708-3368

  
	
  Fax No:

  	
  (866) 745-3305

  

 

If available, an electronic copy
is additionally requested.  Please send
to the following e-mail address:  GNWInvestmentsOperations@genworth.com

 

(4)           Notices with
respect to payments and written confirmation of each such payment, including
interest payments, redemptions, premiums, make wholes, and fees should also be
addressed as above with additional copies addressed to the following:

 

The Bank of New York

Income Collection Department

P.O. Box 19266

Newark, NJ 
07195

	
  Attn:

  	
  PP P&I Department

  
	
  Ref:

  	
  GLIC

  	
  ,

  	
  CUSIP/PPN & Security Description

  
	
  P&I Contact:

  	
  Purisima Teylan - (718) 315-3035

  

 

(5)           Physical
Delivery of the Notes:

 

The Bank of New York

One Wall Street

Window A, 3rd Floor

New York, NY 
10286

 

Register In Nominee Name:              HARE &
CO.

 

23

 

	
  Name and Address of Purchaser

  	
   

  	
  Principal Amount and Series of 

  Notes to be Purchased

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Series A

  
	
   

  	
   

  	
   

  
	
  JOHN HANCOCK LIFE INSURANCE COMPANY (U.S.A.)

  	
   

  	
  $20,000,000

  $ 3,000,000

  

 

REGISTERED NAME OF
SECURITIES:  John Hancock
Life Insurance Company (U.S.A.)

 

(1)           All notices
with respect to payments, prepayments (scheduled and unscheduled, whether
partial or in full) and maturity shall be sent to:

 

John Hancock Financial Services

197 Clarendon Street

Boston, MA 02116

Attention:  US
Securities Operations, C-4

Fax Number: 
(617) 572-0628

 

AND

 

John Hancock Financial Services

197 Clarendon Street

Boston, MA 
02116

Attention: 
Investment Administration, C-2

Fax Number: 
(617) 572-5495

 

24

 

(2)           Other than as
provided in (3) below, all notices and communication with respect to
compliance reporting, financial statements and related certifications shall be
sent to:

 

John Hancock Financial
Services

197 Clarendon Street

Boston, MA  02116

Attention:  Bond and Corporate Finance, C-2

	
  Fax Number:

  	
  (617) 572-0073

  
	
  Email:

  	
  wdroege@jhancock.com   AND

  
	
   

  	
  TDellaPiana@jhancock.com

  

 

(3)           Electronic mail
addresses for electronic delivery of information for purposes of Sections
7.1(a), 7.1(b), 7.1(c) and 7.1(f) of the Note Purchase Agreement:

 

wdroege@jhancock.com   AND

TDellaPiana@jhancock.com

 

(4)           All other
notices shall be sent to:

 

John Hancock Financial
Services

197 Clarendon Street

Boston, MA  02116

Attention:  Investment Law, C-3

	
  Fax Number:

  	
  (617) 572-9269

  
	
  Email:

  	
  pmemishian@jhancock.com

  

 

AND

 

John Hancock Financial
Services

197 Clarendon Street

Boston, MA  02116

Attention:  Bond and Corporate Finance, C-2

	
  Fax Number:

  	
  (617) 572-0073

  
	
  Email:

  	
  wdroege@jhancock.com

  

 

25

 

	
  Name
  and Address of Purchaser

  	
   

  	
  Principal Amount and Series of

  Notes to be Purchased

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Series A

  
	
   

  	
   

  	
   

  
	
  JOHN HANCOCK LIFE INSURANCE COMPANY OF NEW YORK

  	
   

  	
  $2,000,000

  

 

REGISTERED NAME OF SECURITIES:  John Hancock
Life Insurance Company of New York

 

(1)                                  All notices with respect to
payments, prepayments (scheduled and unscheduled, whether partial or in full)
and maturity shall be sent to:

 

John
Hancock Financial Services

197 Clarendon Street

Boston, MA  02116

Attention:  US Securities Operations, C-4

	
  Fax Number:

  	
  (617)
  572-0628

  

 

AND

 

John
Hancock Financial Services

197 Clarendon Street

Boston, MA  02116

Attention:  Investment Administration,
C-2

	
  Fax Number:

  	
  (617)
  572-5495

  

 

26

 

(2)                                  Other than as provided in (3) below,
all notices and communication with respect to compliance reporting, financial
statements and related certifications shall be sent to:

 

	
  John Hancock Financial Services

  
	
  197 Clarendon Street

  
	
  Boston, MA 02116

  
	
  Attention: Bond and Corporate Finance, C-2

  
	
  Fax
  Number:

  	
  (617)
  572-0073

  
	
  Email:

  	
  wdroege@jhancock.com
  AND

  
	
   

  	
  TDellaPiana@jhancock.com

  

 

(3)                                  Electronic mail addresses
for electronic delivery of information for purposes of Sections 7.1(a), 7.1(b),
7.1(c) and 7.1(f) of the Note Purchase Agreement:

 

wdroege@jhancock.com AND

TDellaPiana@jhancock.com

 

(4)                                  All other notices shall be
sent to:

 

	
  John Hancock Financial Services

  
	
  197 Clarendon Street

  
	
  Boston, MA 02116

  
	
  Attention: Investment Law, C-3

  
	
  Fax Number:

  	
  (617)
  572-9269

  
	
  Email:

  	
  pmemishian@jhancock.com

  

 

AND

 

	
  John Hancock Financial Services

  
	
  197 Clarendon Street

  
	
  Boston, MA 02116

  
	
  Attention: Bond and Corporate Finance, C-2

  
	
  Fax Number:

  	
  (617)
  572-0073

  
	
  Email:

  	
  wdroege@jhancock.com

  

 

27

 

	
  Name
  and Address of Purchaser

  	
   

  	
  Principal Amount and Series of

  Notes to be Purchased

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Series A

  
	
   

  	
   

  	
   

  
	
  JPMORGAN
  CHASE BANK,

  AS DIRECTED TRUSTEE FOR THE SBC MASTER PENSION TRUST I/N/O KANE &
  CO.

  	
   

  	
  $1,000,000

  

 

REGISTERED
NAME OF SECURITIES:  Kane &
Co.

 

(1)                                  All notices with respect to
payments, prepayments (scheduled and unscheduled, whether partial or in full)
and maturity shall be sent to:

 

JPMorgan
Chase Bank

3 MetroTech Center, 5th Floor

Brooklyn, NY 11245

Attn: Robert M. Lauer

Fax: (718) 242-2319

 

28

 

(2)                                  Other than as provided in (3) below,
all notices and communication with respect to compliance reporting, financial
statements and related certifications shall be sent to:

 

	
  John Hancock Financial Services

  
	
  197 Clarendon Street

  
	
  Boston, MA 02116

  
	
  Attention: Bond and Corporate Finance, C-2

  
	
  Fax Number:

  	
  (617)
  572-0073

  
	
  Email:

  	
  wdroege@jhancock.com
  AND

  
	
   

  	
  TDellaPiana@jhancock.com

  

 

(3)                                  Electronic mail addresses
for electronic delivery of information for purposes of Sections 7.1(a), 7.1(b),
7.1(c) and 7.1(f) of the Note Purchase Agreement:

 

wdroege@jhancock.com AND

TDellaPiana@jhancock.com

 

(4)                                  All other notices shall be
sent to:

 

John Hancock Financial Services

197 Clarendon Street

Boston, MA  02116

Attention:  Investment Law, C-3

	
  Fax Number:

  	
  (617)
  572-9269

  
	
  Email:

  	
  pmemishian@jhancock.com

  

 

AND

 

John Hancock Financial Services

197 Clarendon Street

Boston, MA  02116

Attention:  Bond and Corporate Finance,
C-2

	
  Fax Number:

  	
  (617)
  572-0073

  
	
  Email:

  	
  wdroege@jhancock.com

  

 

29

 

	
  Name
  and Address of Purchaser

  	
   

  	
  Principal Amount and Series of

  Notes to be Purchased

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Series A

  	
   

  	
  Series B

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  THE
  NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY

  	
   

  	
  $15,000,000

  	
   

  	
  $5,000,000

  

 

Name
and address of purchaser:

 

The Northwestern Mutual Life Insurance Company

720 East Wisconsin Avenue

Milwaukee, WI  53202

 

(1)                                  All notices of
payments and written confirmations of such wire transfers:

 

The Northwestern Mutual Life Insurance Company

720 East Wisconsin Avenue

Milwaukee, WI  53202

Attention:  Investment Operations

Email:  privates@northwesternmutual.com

 

(2)                                  All other
communications (other than as provided in (3) below):

 

The Northwestern Mutual Life Insurance Company

720 East Wisconsin Avenue

Milwaukee, WI  53202

Attention:  Securities Department

Email: 
privateinvest@northwesternmutual.com

 

(3)                                  Electronic mail
address for electronic delivery of information for purposes of Sections 7.1(a),
7.1(b), 7.1(c) and 7.1(f) of the Note Purchase Agreement:

 

privateinvest@northwesternmutual.com

 

(4)                                  Address for
delivery of Notes:

 

30

 

The Northwestern Mutual Life Insurance Company

720 East Wisconsin Avenue

Milwaukee, WI  53202

Attention:  Abim O. Kolawole

 

31

 

	
  Name
  and Address of Purchaser

  	
   

  	
  Principal Amount and Series of

  Notes to be Purchased

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Series A

  
	
   

  	
   

  	
   

  
	
  KNIGHTS
  OF COLUMBUS

  	
   

  	
  $15,000,000

  

 

Name and Address of
Purchaser:

 

Knights of Columbus

One Columbus Plaza

New Haven, CT 06510-3326

Attn:  Investment Accounting Department,
14th Floor

 

(1)                                  Other than as provided in (2) below,
all notices and communications should be mailed and faxed to:

 

	
  Knights of Columbus

  
	
  FPA Account # 201047

  
	
  Attn: Investment Department, 19th Floor

  
	
  One Columbus Plaza

  
	
  New Haven, CT 06510-3326 USA

  
	
  Phone:

  	
  (203) 752 - 4127

  
	
  Fax:

  	
  (203) 752 - 4117

  
	
  Email:

  	
  Investments@kofc.org AND

  
	
   

  	
  Michael.Prinzivalli@kofc.org

  

 

32

 

(2)                                  Electronic mail addresses
for electronic delivery of

information for purposes of Sections 7.1(a), 7.1(b), 

7.1(c) and 7.1(f) of the Note Purchase Agreement:

 

Investments@kofc.org
AND

Michael.Prinzivalli@kofc.org

 

(3)                                  Name of Nominee
in which Notes are to be issued:  None

 

(4)                                  Physical
delivery of Notes to:

 

Mary
Wong, Assistant Treasurer 

Physical Delivery

The Bank of New York Mellon

One Wall Street, 3rd Floor, Window “A”

New York, NY   10286 USA

Tel.                                                    212-635-1003

Email:                                         marywong@bankofny.com

 

33

 

	
  Name
  and Address of Purchaser

  	
   

  	
  Principal Amount and Series of

  Notes to be Purchased

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Series B

  
	
   

  	
   

  	
   

  
	
  THE
  UNION CENTRAL LIFE INSURANCE COMPANY I/N/O/ CUDD & CO.

  	
   

  	
  $3,000,000

  

 

Name
and Address of Purchaser:

 

The
Union Central Life Insurance Company

c/o Summit Investment Advisors, Inc.

390 North Cotner Blvd. 

Lincoln, NE 68505

 

(1)                                  All notices of
payments and written confirmations of such wire transfers sent to:

 

The Union Central Life Insurance Company

1876 Waycross Rd

Cincinnati, Ohio 45240

Attention:                         Treasury
Department

Fax:                                                           (513) 674-5275

 

(2)                                  Other than as
provided in (3) below, all other communications sent to:

 

The Union Central Life Insurance Company

c/o Summit Investment Partners

390 North Cotner Blvd.

Lincoln, NE 68505

 

(3)                                  Electronic mail address for
electronic delivery of

information for purposes of Sections 7.1(a), 7.1(b), 

7.1(c) and 7.1(f) of the Note Purchase Agreement:

 

AWhite@summitinvestments.com

 

34

 

(4)                                  Delivery of
certificates by registered mail to:

 

JPMorgan Chase Bank, N.A.

4 Chase Metrotech Center, 3rd Floor

Brooklyn, NY  11245-0001

ATTN:  Physical Receive Department

REF:  The Union Central Life Insurance
Company

 

To
be registered in the nominee name of CUDD & CO. as nominee for The
Union Central Life Insurance Company

 

AND

 

Copy of Certificates sent to:

 

Andy White

Summit Investment Partners

390 North Cotner Blvd.

Lincoln, NE 68505

 

35

 

	
  Name and Address of Purchaser

  	
   

  	
  Principal Amount and Series of

  Notes to be Purchased

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Series B

  
	
   

  	
   

  	
   

  
	
  ACACIA
  LIFE INSURANCE COMPANY I/N/O/ CUDD & CO.

  	
   

  	
  $1,000,000

  

 

Name
and Address of Purchaser:

 

Acacia
Life Insurance Company

390 North Cotner Blvd.

Lincoln, NE 68505

 

(1)                                  All notices of
payments and written confirmations of such wire transfers sent to:

 

Acacia Life Insurance Company

Summit Investment Partners

390 North Cotner Blvd.

Lincoln, NE 68505

Fax:                           (402) 467-6970

 

(2)                                  Other than as
provided in (3) below, all other communications sent to:

 

Acacia Life Insurance Company

Summit Investment Partners

390 North Cotner Blvd.

Lincoln, NE 68505

Fax:                           (402) 467 -
6970

 

(3)                                  Electronic mail address for
electronic delivery of

information for purposes of Sections 7.1(a), 7.1(b), 

7.1(c) and 7.1(f) of the Note Purchase Agreement:

 

AWhite@summitinvestments.com

 

36

 

(4)                                  Delivery of
certificates by registered mail to:

 

JPMorgan Chase Bank, N.A.

4 Chase Metrotech Center, 3rd Floor

Brooklyn, NY  11245-0001

ATTN:  Physical Receive Department

REF:  Acacia Life Insurance Company

 

To
be registered in the nominee name of CUDD & CO. as nominee for Acacia
Life Insurance Company

 

AND

 

Copy of Certificates sent to:

 

Andy White

Summit Investment Partners

390 North Cotner Blvd.

Lincoln, NE 68505

 

37

 

	
  Name
  and Address of Purchaser

  	
   

  	
  Principal Amount and Series of

  Notes to be Purchased

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Series B

  
	
   

  	
   

  	
   

  
	
  AMERITAS
  LIFE INSURANCE CORP. I/N/O/ CUDD & CO.

  	
   

  	
  $1,000,000

  

 

Name
and Address of Purchaser:

 

Ameritas
Life Insurance Corp.

390 North Cotner Blvd. 

Lincoln, NE 68505

 

(1)                                  All notices of
payments and written confirmations of such wire transfers sent to:

 

Ameritas Life Insurance Corp.

Summit Investment Partners

390 North Cotner Blvd.

Lincoln, NE 68505

Fax #: (402) 467-6970

 

(2)                                  Other than as
provided in (3) below, all other communications sent to:

 

Ameritas Life Insurance Corp.

Summit Investment Partners

390 North Cotner Blvd.

Lincoln, NE 68505

 

(3)                                  Electronic mail address for
electronic delivery of

information for purposes of Sections 7.1(a), 7.1(b), 

7.1(c) and 7.1(f) of the Note Purchase Agreement:

 

AWhite@summitinvestments.com

 

38

 

(4)                                  Delivery of
certificates by registered mail to:

 

JPMorgan Chase Bank, N.A.

4 Chase Metrotech Center, 3rd Floor

Brooklyn, NY  11245-0001

ATTN:  Physical Receive Department

REF:  Ameritas Life Insurance Corp.

 

To
be registered in the nominee name of CUDD & CO. as nominee for
Ameritas Life Insurance Corp.

 

AND

 

Copy of Certificates sent to:

 

Andy White

Summit Investment Partners

390 North Cotner Blvd.

Lincoln, NE 68505

 

39

 

SCHEDULE B

 

DEFINED TERMS

 

As
used herein, the following terms have the respective meanings set forth below
or set forth in the Section hereof following such term:

 

“Affiliate” means, at any time, and with respect to any
Person, any other Person that at such time directly or indirectly through one
or more intermediaries Controls, or is Controlled by, or is under common
Control with, such first Person, and, with respect to the Company, shall
include any Person beneficially owning or holding, directly or indirectly, 10%
or more of any class of voting or equity interests of the Company or any
Subsidiary or any corporation of which the Company and its Subsidiaries
beneficially own or hold, in the aggregate, directly or indirectly, 10% or more
of any class of voting or equity interests. 
As used in this definition, “Control” means
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise. Unless the context
otherwise clearly requires, any reference to an “Affiliate” is a reference to
an Affiliate of the Company.

 

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

 

“Anti-Terrorism Order” means Executive Order No. 13,224
of September 24, 2001, Blocking Property and Prohibiting Transactions with
Persons Who Commit, Threaten to Commit or Support Terrorism, 66 U.S. Fed. Reg.
49, 079 (2001), as amended.

 

“Attributable Debt” means, as to any particular lease
relating to a Sale/Leaseback transaction, the total amount of rent (discounted
semiannually from the respective due dates thereof at the interest rate
implicit in such lease) required to be paid by the lessee under such lease
during the remaining term thereof.  The
amount of rent required to be paid under any such lease for any such period
shall be (a) the total amount of the rent payable by the lessee with
respect to such period after excluding amounts required to be paid on account
of maintenance and repairs, insurance, taxes, assessments, utilities, operating
and labor costs and similar charges plus (b) without duplication, any
guaranteed residual value in respect of such lease to the extent such guarantee
would be included in indebtedness in accordance with GAAP.

 

“Business Day” means any day other than a Saturday, a Sunday
or a day on which commercial banks in New York City are required or authorized
to be closed.

 

“Capital Lease” means, at any time, a lease with respect to
which the lessee is required concurrently to recognize the acquisition of an
asset and the incurrence of a liability in accordance with GAAP.

 

“Capital Lease Obligations” of any Person means, at any time,
the obligations of such Person to pay rent or other amounts under any lease of
(or other arrangement conveying the right to use) real or personal property, or
a combination thereof, which obligations are required to be classified and
accounted for as Capital Leases on a balance sheet of such Person under GAAP, 

 

 

and
the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.

 

“Change of Control” is defined in Section 8.3.

 

“Closing” is defined in Section 3.

 

“Code” means the Internal Revenue Code of 1986, as amended
from time to time, and the rules and regulations promulgated thereunder
from time to time.

 

“Company” means Waddell & Reed Financial, Inc.,
a Delaware corporation, or any successor that becomes such in the manner
prescribed in Section 10.5.

 

“Confidential Information” is defined in Section 20.

 

“Consolidated EBITDA” means, for any period, Consolidated Net
Income for such period, plus (a) without duplication and to the extent
reflected as a charge in the statement of such Consolidated Net Income for such
period, the sum of (i) income tax expense, (ii) interest expense,
amortization or writeoff of debt discount and debt issuance costs and
commissions, discounts and other fees and charges associated with Indebtedness
(including the Notes), (iii) depreciation and amortization expense,
(iv) amortization of intangibles (including, but not limited to, goodwill)
and organization costs, (v) any extraordinary, unusual or non-recurring
non-cash expenses or losses (including, whether or not otherwise includable as
a separate item in the statement of such Consolidated Net Income for such
period, non-cash losses on sales of assets outside of the ordinary course of
business), provided that the amounts referred to in
this clause (v) shall not, in the aggregate, exceed $10,000,000 for any
fiscal year of the Company, and (vi) any other non-cash charges, minus
(b) without duplication and to the extent reflected as income in the
statement of such Consolidated Net Income for such period, any extraordinary,
unusual or non-recurring non-cash income or gains (including, whether or not
otherwise includable as a separate item in the statement of such Consolidated
Net Income for such period, non-cash gains on sales of assets outside of the
ordinary course of business), provided that
the Company shall not be required to deduct more than $10,000,000 in the
aggregate of the amounts referred to in this clause (b) for any fiscal
year of the Company.  For the purposes of
calculating Consolidated EBITDA for any Relevant Period pursuant to Section 10.1(a),
(x) if at any time during such Relevant Period the Company or any
Subsidiary shall have made any Material Disposition, the Consolidated EBITDA
for such Relevant Period shall be reduced by an amount equal to the
Consolidated EBITDA (if positive) attributable to the property that is the
subject of such Material Disposition for such Relevant Period or increased by
an amount equal to the Consolidated EBITDA (if negative) attributable thereto
for such Relevant Period, and (y) if during such Relevant Period the
Company or any Subsidiary shall have made a Material Acquisition, Consolidated
EBITDA for such Relevant Period shall be calculated after giving pro forma effect thereto as if such Material Acquisition
occurred on the first day of such Relevant Period.  As used in this definition, “Material Acquisition” means any acquisition of property or
series of related acquisitions of property that (1) constitutes assets
comprising all or substantially all of an operating unit of a business or
constitutes all or substantially all of the common stock of a Person and
(2) involves the payment of consideration by the Company and its
Subsidiaries in excess of $1,000,000; and “Material Disposition”
means any Disposition of property or series 

 

2

 

of
related Dispositions of property that yields gross proceeds to the Company or
any of its Subsidiaries in excess of $1,000,000.

 

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

 

“Consolidated Net Income” means, for any period, the
consolidated net income (or loss) of the Company and its Subsidiaries,
determined on a consolidated basis in accordance with GAAP; provided that there shall be excluded (a) the income
(or deficit) of any Person accrued prior to the date it becomes a Subsidiary of
the Company or is merged into or consolidated with the Company or any of its
Subsidiaries, (b) the income (or deficit) of any Person (other than a Subsidiary
of the Company) in which the Company or any of its Subsidiaries has an
ownership interest, except to the extent that any such income is actually
received by the Company or such Subsidiary in the form of dividends or similar
distributions, and (c) the undistributed earnings of any Subsidiary of the
Company to the extent that the declaration or payment of dividends or similar
distributions by such Subsidiary is not at the time permitted by the terms of
any Contractual Obligation or Requirement of Law applicable to such
Subsidiary.  As used in this definition, “Contractual Obligation” means, as to any Person, any
provision of any security issued by such Person or of any indenture, agreement,
instrument or other undertaking to which such Person is a party or by which it
or any of its property is bound; and “Requirement of Law”
means, as to any Person, the Certificate of Incorporation and By-Laws or other
organizational or governing documents of such Person, and any law, treaty, rule or
regulation or determination, order, injunction, writ or decree of an arbitrator
or a court or other Governmental Authority, in each case applicable to or
binding upon such Person or any of its property or to which such Person or any
of its property is subject.

 

“Consolidated Net Worth” means, at a particular date, all
amounts which would, in conformity with GAAP, be included under stockholders’
equity on a consolidated balance sheet of the Company and its Subsidiaries at
such date.

 

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

 

“Default” means an event or condition the occurrence or
existence of which would, with the lapse of time or the giving of notice or
both, become an Event of Default.

 

“Default Rate” means that rate of interest that is the
greater of (a) 2% per annum above the rate of interest stated in clause (a) of
the first paragraph of the Notes or (b) 2% over the rate of interest
publicly announced by Bank of America, N.A. in New York, New York as its “base”
or “prime” rate.

 

“Disclosure Document” is defined in Section 5.3.

 

3

 

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

 

“Electronic Delivery” is defined in Section 7.1(a).

 

“Environmental Laws” means any and all Federal, state, local,
and foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
governmental restrictions relating to pollution and the protection of the
environment or the release of any materials into the environment, including but
not limited to those related to Hazardous Materials.

 

“ERISA” means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the rules and regulations
promulgated thereunder from time to time in effect.

 

“ERISA Affiliate” means any trade or business (whether or not
incorporated) that is treated as a single employer together with the Company
under section 414 of the Code.

 

“Event of Default” is defined in Section 11.

 

“Existing Credit Facility” means the Credit Agreement, dated
as of August 31, 2010, by and among the Company, the lenders from
time to time party thereto, as lenders, and Bank of America, N.A., as
administrative agent.

 

“GAAP” means generally accepted accounting principles as in
effect from time to time in the United States of America.

 

“Governmental Authority” means

 

(a)                                  the government of

 

(i)                                     the United States of America or any State or other political subdivision
thereof, or

 

(ii)                                  any other jurisdiction in which the Company or any Subsidiary conducts
all or any part of its business, or which asserts jurisdiction over any
properties of the Company or any Subsidiary, or

 

(b)                                 any entity exercising executive, legislative, judicial, regulatory or
administrative functions of, or pertaining to, any such government.

 

“Guaranty” means, with respect to any Person, any obligation
(except the endorsement in the ordinary course of business of negotiable
instruments for deposit or collection) of such Person guaranteeing or in effect
guaranteeing any indebtedness, dividend or other obligation of any other Person
in any manner, whether directly or indirectly, including (without limitation)
obligations incurred through an agreement, contingent or otherwise, by such
Person:

 

4

 

(a)                                  to purchase such indebtedness or obligation or any property constituting
security therefor;

 

(b)                                 to advance or supply funds (i) for the purchase or payment of such
indebtedness or obligation, or (ii) to maintain any working capital or
other balance sheet condition or any income statement condition of any other
Person or otherwise to advance or make available funds for the purchase or
payment of such indebtedness or obligation;

 

(c)                                  to lease properties or to purchase properties or services primarily for
the purpose of assuring the owner of such indebtedness or obligation of the
ability of any other Person to make payment of the indebtedness or obligation;
or

 

(d)                                 otherwise to assure the owner of such indebtedness or obligation against
loss in respect thereof.

 

In
any computation of the indebtedness or other liabilities of the obligor under
any Guaranty, the indebtedness or other obligations that are the subject of
such Guaranty shall be assumed to be direct obligations of such obligor.

 

“Hazardous Material” means any and all pollutants, toxic or
hazardous wastes or other substances that might pose a hazard to health and
safety, the removal of which may be required or the generation, manufacture,
refining, production, processing, treatment, storage, handling, transportation,
transfer, use, disposal, release, discharge, spillage, seepage or
filtration of which is or shall be restricted, prohibited or penalized by any
applicable law including, but not limited to, asbestos, urea formaldehyde foam
insulation, polychlorinated biphenyls, petroleum, petroleum products, lead
based paint, radon gas or similar restricted, prohibited or penalized
substances.

 

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

 

“holder” means, with respect to any Note the Person in whose
name such Note is registered in the register maintained by the Company pursuant
to Section 13.1.

 

“Indebtedness” with respect to any Person means, at any time,
without duplication,

 

(a)                                  its liabilities for borrowed money and its redemption obligations in
respect of mandatorily redeemable Preferred Stock;

 

(b)                                 its liabilities for the deferred purchase price of property acquired by
such Person (excluding accounts payable arising in the ordinary course of
business but including all liabilities created or arising under any conditional
sale or other title retention agreement with respect to any such property);

 

(c)                                  (i) Capital Lease Obligations and (ii) all liabilities that
would appear on its balance sheet in accordance with GAAP in respect of
Synthetic Leases assuming such Synthetic Leases were accounted for as Capital
Leases;

 

5

 

(d)                                 all liabilities for borrowed money secured by any Lien with respect to
any property owned by such Person (whether or not it has assumed or otherwise
become liable for such liabilities);

 

(e)                                  all its liabilities in respect of letters of credit or instruments
serving a similar function issued or accepted for its account by banks and
other financial institutions (whether or not representing obligations for
borrowed money);

 

(f)                                    the aggregate Termination Value of all Hedging Agreements of such Person;
and

 

(g)                                 any Guaranty of such Person with respect to liabilities of a type
described in any of clauses (a) through (f) hereof.

 

Indebtedness
of any Person shall include (x) all obligations of such Person of the
character described in clauses (a) through (g) to the extent such
Person remains legally liable in respect thereof notwithstanding that any such
obligation is deemed to be extinguished under GAAP and (y) the
Indebtedness of any other entity (including any partnership in which such
Person is a general partner) to the extent such Person is liable therefor as a
result of such Person’s ownership interest in or other relationship with such entity,
except to the extent the terms of such Indebtedness provide that such Person is
not liable therefor.

 

“Institutional Investor” means (a) any Purchaser of a
Note, (b) any holder of a Note holding (together with one or more of its
affiliates) more than 5.00% of the aggregate principal amount of the Notes then
outstanding, (c) any bank, trust company, savings and loan association or
other financial institution, any pension plan, any investment company, any
insurance company, any broker or dealer, or any other similar financial
institution or entity, regardless of legal form, and (d) any Related Fund
of any holder of any Note.

 

“Lien” means, with respect to any Person, any mortgage, lien,
pledge, charge, security interest or other encumbrance, or any 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 Capital Lease,
upon or with respect to any property or asset of such Person (including in the
case of stock, stockholder agreements, voting trust agreements and all similar
arrangements).

 

“Major Credit Facility” means (a) the Existing Credit
Facility and (b) any other working capital credit, loan or borrowing
facility (including any renewal, extension, replacement or refinancing thereof)
entered into on or after the date of the Closing by the Company or any
Subsidiary in a principal amount equal to or greater than $10,000,000.

 

“Majority Holders” means, at any time, the holders of more
than 50% in principal amount of the Notes at the time outstanding (exclusive of
Notes then owned by the Company or any of its Affiliates).

 

“Make-Whole Amount” is defined in Section 8.7.

 

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

 

6

 

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

 

“Material” means material in relation to the business,
operations, affairs, financial condition, assets, properties, or prospects of
the Company and its Subsidiaries taken as a whole.

 

“Material Adverse Effect” means a material adverse effect on (a) the
business, operations, affairs, financial condition, assets or properties of the
Company and its Subsidiaries taken as a whole, or (b) the ability of the
Company to perform its obligations under this Agreement and the Notes, or (c) the
validity or enforceability of this Agreement or the Notes.

 

“Memorandum” is defined in Section 5.3.

 

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

 

“Multiemployer Plan” means any Plan that is a “multiemployer
plan” (as such term is defined in section 4001(a)(3) of ERISA).

 

“NAIC” means the National Association of Insurance
Commissioners or any successor thereto.

 

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

 

“Notes” is defined in Section 1.

 

“Officer’s Certificate” means a certificate of a Senior
Financial Officer or of any other officer of the Company whose responsibilities
extend to the subject matter of such certificate.

 

“PBGC” means the Pension Benefit Guaranty Corporation
referred to and defined in ERISA or any successor thereto.

 

“Pension Plan” means a Plan, other than a Multiemployer Plan,
that is subject to Title IV of ERISA.

 

“Permitted Encumbrances” means:

 

(a)                                  Liens imposed
by law for taxes that are not yet due or are being contested in compliance with
Section 9.4;

 

(b)                                 Carriers’,
warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like Liens
imposed by law, arising in the ordinary course of business and securing
obligations that are not overdue by more than 30 days or are being contested in
compliance with Section 9.4;

 

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

 

7

 

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

 

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

 

(f)                                    judgment Liens
in respect of judgments that do not constitute an Event of Default under Section 11(i),
so long as such judgment Liens are not in effect for more than 45 days;

 

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

 

“Person” means an individual, partnership, corporation, limited
liability company, association, trust, unincorporated organization, business
entity or Governmental Authority.

 

“Plan” means an “employee benefit plan” (as defined in
section 3(3) of ERISA) subject to Title I of ERISA that is maintained, or
to which contributions are made or required to be made, by the Company or any
ERISA Affiliate or with respect to which the Company or any ERISA Affiliate may
have any liability.

 

“Preferred Stock” means any class of capital stock of a
Person that is preferred over any other class of capital stock (or similar
equity interests) of such Person as to the payment of dividends or the payment
of any amount upon liquidation or dissolution of such Person.

 

“property” or “properties”
means, unless otherwise specifically limited, real or personal property of any
kind, tangible or intangible, choate or inchoate.

 

“PTE” is defined in Section 6.2(a).

 

“Purchaser” is defined in the first paragraph of this
Agreement.

 

“Related Fund” means, with respect to any holder of any Note,
any fund or entity that (i) invests in Securities or bank loans, and (ii) is
advised or managed by such holder, the same investment advisor as such holder
or by an affiliate of such holder or such investment advisor.

 

“Relevant Period” means, at any date of determination, the
most recently completed four fiscal quarters of the Company.

 

“Responsible Officer” means the Chief Executive Officer,
President, any Senior Financial Officer and any other officer of the Company
with responsibility for the administration of the relevant portion of this
Agreement.

 

“Restricted Payment” means (a) any dividend or other
distribution (whether in cash, securities or other property) with respect to
any shares of any class of capital stock of the Company or any Subsidiary, or (b) any
payment (whether in cash, securities or other property), 

 

8

 

including
any sinking fund or similar deposit, for (i) the purchase, redemption,
retirement, acquisition, cancellation or termination of any shares of the
Company’s capital stock, or (ii) any option, warrant or other right to
acquire any shares of the Company’s capital stock.

 

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

 

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

 

“Sale/Leaseback Transaction” is defined in Section 10.6.

 

“SEC” means the Securities and Exchange Commission of the
United States, or any successor thereto.

 

“Securities” or “Security” shall
have the meaning specified in Section 2(1) of the Securities Act.

 

“Securities Act” means the Securities Act of 1933, as amended
from time to time, and the rules and regulations promulgated thereunder
from time to time in effect.

 

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

 

“Series A Notes” is defined in Section 1.

 

“Series B Notes” is defined in Section 1.

 

“Subsidiary” means, as to any Person, any other Person in
which such first Person or one or more of its Subsidiaries or such first Person
and one or more of its Subsidiaries owns sufficient equity or voting interests
to enable it or them (as a group) ordinarily, in the absence of contingencies,
to elect a majority of the directors (or Persons performing similar functions)
of such second Person, and any partnership or joint venture if more than a 50%
interest in the profits or capital thereof is owned by such first Person or one
or more of its Subsidiaries or such first Person and one or more of its Subsidiaries
(unless such partnership or joint venture can and does ordinarily take major
business actions without the prior approval of such Person or one or more of
its Subsidiaries).  Unless the context
otherwise clearly requires, any reference to a “Subsidiary” is a reference to a
Subsidiary of the Company.

 

“SVO” means the Securities Valuation Office of the NAIC or
any successor to such Office.

 

“Synthetic Lease” means, at any time, any lease (including
leases that may be terminated by the lessee at any time) of any property
(a) that is accounted for as an operating lease under 

 

9

 

GAAP
and (b) in respect of which the lessee retains or obtains ownership of the
property so leased for U.S. federal income tax purposes, other than any such
lease under which such Person is the lessor.

 

“Termination Value” means, in respect of any one or more
Hedging Agreements, after taking into account the effect of any legally
enforceable netting agreement relating to such Hedging Agreements, (a) for
any date on or after the date such Hedging Agreements have been closed out and
termination value(s) determined in accordance therewith, such termination
value(s), and (b) for any date prior to the date referenced in clause (a),
the amounts(s) determined as the mark-to-market values(s) for such
Hedging Agreements, as determined based upon one or more mid-market or other
readily available quotations provided by any recognized dealer in such Hedging
Agreements.

 

“USA Patriot Act” means United States Public Law 107-56,
Uniting and Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism (USA Patriot Act) Act of 2001.

 

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

 

“Wholly-Owned Subsidiary” means, at any time, any Subsidiary
one hundred percent of all of the equity interests (except directors’
qualifying shares) and voting interests of which are owned by any one or more
of the Company and the Company’s other Wholly-Owned Subsidiaries at such time.

 

10

 

Schedule 5.3

 

Disclosure Documents

 

1.             Private
Placement Memorandum dated July 2010.

 

2.             Note Purchase
Agreement, dated as of August 31, 2010, by and among Waddell &
Reed Financial, Inc. and the Purchasers.

 

3.             Investor
Presentation dated July 30, 2010.

 

4.             Earnings Press
Release dated July 28, 2010.

 

5.             Annual Report
and Form 10-K for the year ended December 31, 2005.

 

6.             Annual Report
and Form 10-K for the year ended December 31, 2006.

 

7.             Annual Report
and Form 10-K for the year ended December 31, 2007.

 

8.             Annual Report
and Form 10-K for the year ended December 31, 2008.

 

9.             Annual Report
and Form 10-K for the year ended December 31, 2009.

 

10.           Quarterly Report on Form 10-Q for the quarter
ended March 31, 2010.

 

11.           Quarterly Report on Form 10-Q for the quarter
ended June 30, 2010.

 

 

Schedule 5.4

 

Subsidiaries of the Company and Ownership of Subsidiary Stock

 

(i) Subsidiaries
— The Company or a Subsidiary thereof owns, directly or indirectly, 100% of all
capital stock of each of the Company’s Subsidiaries as indicated in the table
below:

 

	
  Name

  	
   

  	
  Jurisdiction of

  Incorporation

  or Formation

  	
   

  	
  Ownership

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Waddell &
  Reed Financial Services, Inc.

  	
   

  	
  Missouri

  	
   

  	
  Waddell &
  Reed Financial, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Waddell &
  Reed, Inc.

  	
   

  	
  Delaware

  	
   

  	
  Waddell &
  Reed Financial Services, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Waddell &
  Reed Investment Management Company

  	
   

  	
  Kansas

  	
   

  	
  Waddell &
  Reed, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Waddell &
  Reed Services Company

  	
   

  	
  Missouri

  	
   

  	
  Waddell &
  Reed, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W&R
  Capital Management Group, Inc.

  	
   

  	
  Delaware

  	
   

  	
  Waddell &
  Reed Investment Management Company

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W&R
  Corporate LLC

  	
   

  	
  Delaware

  	
   

  	
  Waddell &
  Reed Services Company

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy
  Investment Management Company

  	
   

  	
  Delaware

  	
   

  	
  Waddell &
  Reed Financial, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy
  Funds Distributor, Inc.

  	
   

  	
  Florida

  	
   

  	
  Ivy
  Investment Management Company

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fiduciary
  Trust Company of New Hampshire

  	
   

  	
  New
  Hampshire

  	
   

  	
  Waddell &
  Reed, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W &
  R Insurance Agency, Inc.

  	
   

  	
  Missouri

  	
   

  	
  Waddell &
  Reed, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W &
  R Insurance Agency of Alabama, Inc.

  	
   

  	
  Alabama

  	
   

  	
  Waddell &
  Reed, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W &
  R Insurance Agency of Colorado, Inc.

  	
   

  	
  Colorado

  	
   

  	
  Waddell &
  Reed, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W &
  R Insurance Agency of Montana, Inc.

  	
   

  	
  Montana

  	
   

  	
  Waddell &
  Reed, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W &
  R Insurance Agency of Nevada, Inc.

  	
   

  	
  Nevada

  	
   

  	
  Waddell &
  Reed, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W &
  R Insurance Agency of Utah, Inc.

  	
   

  	
  Utah

  	
   

  	
  Waddell &
  Reed, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W &
  R Insurance Agency of Wisconsin, Inc.

  	
   

  	
  Wisconsin

  	
   

  	
  Waddell &
  Reed, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Unicon
  Agency, Inc.

  	
   

  	
  New
  York

  	
   

  	
  Waddell &
  Reed, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Unicon
  Insurance Agency of Massachusetts, Inc.

  	
   

  	
  Massachusetts

  	
   

  	
  Waddell &
  Reed, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Legend
  Group Holdings, LLC

  	
   

  	
  Delaware

  	
   

  	
  Waddell &
  Reed Financial, Inc.

  

 

 

	
  Legend
  Advisory Corporation

  	
   

  	
  New
  York

  	
   

  	
  Legend
  Group Holdings, LLC

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Legend
  Equities Corporation

  	
   

  	
  Delaware

  	
   

  	
  Legend
  Group Holdings, LLC

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Advisory
  Services Corporation

  	
   

  	
  Nevada

  	
   

  	
  Legend
  Group Holdings, LLC

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  Legend Group, Inc.

  	
   

  	
  Delaware

  	
   

  	
  Legend
  Group Holdings, LLC

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LEC
  Insurance Agency, Inc.

  	
   

  	
  Texas

  	
   

  	
  Legend
  Equities Corporation

  

 

(ii)           Directors and Senior
Executive Officers of the Company

 

Directors

 

Sharilyn
S. Gasaway

Thomas
C. Godlasky

Henry
J. Herrmann

Alan
W. Kosloff

Dennis E. Logue

Michael F. Morrissey

James
M. Raines

Ronald
C. Reimer

William
L. Rogers

Jerry
W. Walton

 

Senior
Executive Officers

 

Henry
J. Herrmann, Chairman of the Board and Chief Executive Officer

Michael
L. Avery, President and Chief Investment Officer

Thomas
W. Butch, Executive Vice President and Chief Marketing Officer

Brent
K. Bloss, Senior Vice President — Finance, Treasurer and Principal Accounting
Officer

Daniel
P. Connealy, Senior Vice President and Chief Financial Officer

Mark
A. Schieber, Senior Vice President and Controller

Daniel
C. Schulte, Senior Vice President and General Counsel

Michael
D. Strohm, Senior Vice President and Chief Operations Officer

John
E. Sundeen, Jr., Senior Vice President and Chief Administrative Officer —
Investments

Wendy
J. Hills, Vice President, Secretary and Associate General Counsel

 

2

 

Schedule 5.5

 

Financial Statements

 

1.             Audited
consolidated financial statements of the Company for the 2005 fiscal year.

 

2.             Audited
consolidated financial statements of the Company for the 2006 fiscal year.

 

3.             Audited
consolidated financial statements of the Company for the 2007 fiscal year.

 

4.             Audited
consolidated financial statements of the Company for the 2008 fiscal year.

 

5.             Audited
consolidated financial statements of the Company for the 2009 fiscal year.

 

6.             Unaudited
interim consolidated financial statements of the Company for the quarterly
period ended March 31, 2010.

 

7.             Unaudited
interim consolidated financial statements of the Company for the quarterly
period ended June 30, 2010.

 

 

Schedule 5.8

 

Litigation

 

1.             Michael
E. Taylor, Kenneth B. Young, individuals, on behalf of themselves individually
and on behalf of others similarly situated v. Waddell & Reed, Inc.,
a Delaware Corporation; Waddell & Reed Financial, Inc., a
Delaware Corporation; Waddell & Reed Development, Inc., a
Delaware Corporation; Waddell & Reed Financial Advisors, a fictitious
business name; and DOES 1 through 10 inclusive; Case No. 09-CV-2909 DMS
WVG; in the United States District Court for the Southern District of
California.

 

 

Schedule 5.15

 

Existing Indebtedness

 

1.             $190.0 million
in principal amount 5.60% senior notes due January 15, 2011.

 

2.             Credit
Agreement, dated as of August 31, 2010, by and among Waddell &
Reed Financial, Inc., the lenders party thereto from time to time, Bank of
America, N.A., as administrative agent, and Bank of America Securities LLC, as
lead arranger and book manager.

 

3.             Waddell &
Reed Financial, Inc. - $2 thousand of capital lease obligations.

 

4.             Waddell &
Reed, Inc. - $748 thousand of capital lease obligations.

 

5.             W&R
Corporate LLC - $10 thousand of capital lease obligations.

 

6.             Advisory
Services Corporation - $15 thousand of capital lease obligations.

 

 

Schedule 10.2

 

Existing Subsidiary Indebtedness

 

1.             Waddell &
Reed, Inc. - $748 thousand of capital lease obligations.

 

2.             W&R
Corporate LLC - $10 thousand of capital lease obligations.

 

3.             Advisory Services Corporation
- $15 thousand of capital lease obligations.

 

 

Schedule 10.3

 

Existing Liens

 

1.             Aircraft Lease,
dated as of September 24, 2008, by and between Waddell & Reed, Inc.
as Lessee and Wilmington Trust Company, not in its individual capacity, but
solely as the Owner Trustee under Trust Agreement dated as of April 3,
2006, as Lessor.

 

 

Schedule 10.6

 

Sale/Leaseback Properties

 

1.             6300 Lamar
Avenue, Overland Park, Kansas

 

2.             6301 Glenwood,
Overland Park, Kansas

 

 

 

EXHIBIT 1(a)

 

[FORM OF SERIES A NOTE]

 

WADDELL & REED
FINANCIAL, INC.

 

5.00% SENIOR NOTE, SERIES
A, DUE 2018

 

	
  No. [          ]

  	
  [Date]

  
	
   

  	
   

  
	
  $[              ]

  	
  PPN[                            ]

  

 

FOR
VALUE RECEIVED, the undersigned, WADDELL & REED FINANCIAL, INC.
(herein called the “Company”), a
corporation organized and existing under the laws of the State of Delaware,
hereby promises to pay to
[                        ],
or registered assigns, the principal sum of
[                                          ]
DOLLARS (or so much thereof as shall not have been prepaid) on January 13,
2018, with interest (computed on the basis of a 360-day year of twelve 30 day
months) (a) on the unpaid balance hereof at the rate of 5.00% per annum
from the date hereof, payable semiannually, on the 13th day of January and
July in each year, commencing with the January or July next
succeeding the date hereof, until the principal hereof shall have become due
and payable, and (b) to the extent permitted by law, on any overdue payment
of interest and, during the continuance of an Event of Default, on such unpaid
balance and on any overdue payment of any Make Whole Amount, at a rate per
annum from time to time equal to the greater of (i) 7.00% or (ii) 2%
over the rate of interest publicly announced by Bank of America, N.A. from time
to time at its principal office in New York City as its “base” or “prime” rate,
payable semiannually as aforesaid (or, at the option of the registered holder
hereof, on demand).

 

Payments
of principal of, interest on and any Make-Whole Amount with respect to this
Note are to be made in lawful money of the United States of America at said
principal office of Bank of America, N.A. in New York City or at such other
place as the Company shall have designated by written notice to the holder of
this Note as provided in the Note Purchase Agreement referred to below.

 

This
Note is one of a series of Senior Notes (herein called the “Notes”) issued pursuant to the Note Purchase Agreement,
dated as of August 31, 2010 (as from time to time amended, the “Note Purchase Agreement”), between the Company and the
respective Purchasers named therein and is entitled to the benefits
thereof.  Each holder of this Note will
be deemed, by its acceptance hereof, to have (i) agreed to the
confidentiality provisions set forth in Section 20 of the Note Purchase
Agreement and (ii) made the representations and acknowledgements set forth
in Sections 6.1 and 6.2 of the Note Purchase Agreement.  Unless otherwise indicated, capitalized terms
used in this Note shall have the respective meanings ascribed to such terms in
the Note Purchase Agreement.

 

This
Note is a registered Note and, as provided in the Note Purchase Agreement, upon
surrender of this Note for registration of transfer accompanied by a written
instrument of transfer 

 

 

duly
executed, by the registered holder hereof or such holder’s attorney duly
authorized in writing, a new Note of the same series and for a like principal
amount will be issued to, and registered in the name of, the transferee.  Prior to due presentment for registration of
transfer, the Company may treat the person in whose name this Note is
registered as the owner hereof for the purpose of receiving payment and for all
other purposes, and the Company will not be affected by any notice to the
contrary.

 

This
Note is subject to optional prepayment, in whole or from time to time in part,
at the times and on the terms specified in the Note Purchase Agreement, but not
otherwise.

 

If
an Event of Default occurs and is continuing, the principal of this Note may be
declared or otherwise become due and payable in the manner, at the price
(including any applicable Make-Whole Amount) and with the effect provided in
the Note Purchase Agreement.

 

This
Note shall be construed and enforced in accordance with, and the rights of the
Company and the holder of this Note shall be governed by, the law of the State
of New York excluding choice-of-law principles of the law of such State that
would permit the application of the laws of a jurisdiction other than such
State.

 

	
   

  	
  WADDELL &
  REED FINANCIAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

2

 

EXHIBIT 1(b)

 

[FORM OF SERIES B
NOTE]

 

WADDELL & REED
FINANCIAL, INC.

 

5.75% SENIOR NOTE, SERIES
B, DUE 2021

 

	
  No. [          ]

  	
  [Date]

  
	
   

  	
   

  
	
  $[              ]

  	
  PPN[                            ]

  

 

FOR
VALUE RECEIVED, the undersigned, WADDELL & REED FINANCIAL, INC.
(herein called the “Company”), a
corporation organized and existing under the laws of the State of Delaware,
hereby promises to pay to
[                        ],
or registered assigns, the principal sum of [                                          ]
DOLLARS (or so much thereof as shall not have been prepaid) on January 13,
2021, with interest (computed on the basis of a 360-day year of twelve 30 day
months) (a) on the unpaid balance hereof at the rate of 5.75% per annum
from the date hereof, payable semiannually, on the 13th day of January and
July in each year, commencing with the January or July next succeeding
the date hereof, until the principal hereof shall have become due and payable,
and (b) to the extent permitted by law, on any overdue payment of interest
and, during the continuance of an Event of Default, on such unpaid balance and
on any overdue payment of any Make Whole Amount, at a rate per annum from time
to time equal to the greater of (i) 7.75% or (ii) 2% over the rate of
interest publicly announced by Bank of America, N.A. from time to time at its
principal office in New York City as its “base” or “prime” rate, payable
semiannually as aforesaid (or, at the option of the registered holder hereof,
on demand).

 

Payments
of principal of, interest on and any Make-Whole Amount with respect to this
Note are to be made in lawful money of the United States of America at said
principal office of Bank of America, N.A. in New York City or at such other
place as the Company shall have designated by written notice to the holder of
this Note as provided in the Note Purchase Agreement referred to below.

 

This
Note is one of a series of Senior Notes (herein called the “Notes”) issued pursuant to the Note Purchase Agreement,
dated as of August 31, 2010 (as from time to time amended, the “Note Purchase Agreement”), between the Company and the
respective Purchasers named therein and is entitled to the benefits
thereof.  Each holder of this Note will
be deemed, by its acceptance hereof, to have (i) agreed to the
confidentiality provisions set forth in Section 20 of the Note Purchase
Agreement and (ii) made the representations and acknowledgements set forth
in Sections 6.1 and 6.2 of the Note Purchase Agreement.  Unless otherwise indicated, capitalized terms
used in this Note shall have the respective meanings ascribed to such terms in
the Note Purchase Agreement.

 

This
Note is a registered Note and, as provided in the Note Purchase Agreement, upon
surrender of this Note for registration of transfer accompanied by a written
instrument of transfer 

 

 

duly
executed, by the registered holder hereof or such holder’s attorney duly
authorized in writing, a new Note of the same series and for a like principal
amount will be issued to, and registered in the name of, the transferee.  Prior to due presentment for registration of
transfer, the Company may treat the person in whose name this Note is
registered as the owner hereof for the purpose of receiving payment and for all
other purposes, and the Company will not be affected by any notice to the
contrary.

 

This
Note is subject to optional prepayment, in whole or from time to time in part,
at the times and on the terms specified in the Note Purchase Agreement, but not
otherwise.

 

If
an Event of Default occurs and is continuing, the principal of this Note may be
declared or otherwise become due and payable in the manner, at the price
(including any applicable Make-Whole Amount) and with the effect provided in
the Note Purchase Agreement.

 

This
Note shall be construed and enforced in accordance with, and the rights of the
Company and the holder of this Note shall be governed by, the law of the State
of New York excluding choice-of-law principles of the law of such State that
would permit the application of the laws of a jurisdiction other than such
State.

 

	
   

  	
  WADDELL &
  REED FINANCIAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

2

 

 

EXHIBITS 4.4(a)(i) and
4.4(a)(ii)

 

Forms of Opinions of
Special Counsel to the Company

 

 

 

Exhibit 4.4(a)(i)

 

Form of Special Counsel to the Company Signing Opinion

 

August 31, 2010

 

To
the Purchasers Listed on Exhibit A

 

Re:          Waddell & Reed
Financial, Inc.

 

Ladies
and Gentlemen:

 

We
have acted as counsel to Waddell & Reed Financial, Inc., a Delaware
corporation (the “Company”), in connection with that certain Note
Purchase Agreement, dated as of August 31, 2010 by and among the Company
and the Purchasers identified on Schedule A thereto (such agreement without
Exhibits and Schedules thereto being hereinafter referred to as the “Note
Purchase Agreement”).  This opinion
is being delivered to you pursuant to Section 4.4(a)(i) of the Note
Purchase Agreement.  All capitalized
terms used herein and not otherwise defined herein shall have the same meanings
herein as set forth in the Note Purchase Agreement.

 

In
connection with this opinion, we have examined the Note Purchase Agreement and
the Exhibits and Schedules thereto, including the forms of the Notes, and such
documents, corporate records and questions of law as we deem necessary for the
purposes of this opinion.  We have also
examined such certificates of public officials, corporate officers of the
Company and of other Persons as we have deemed relevant and appropriate as a
basis for the opinions expressed herein, and we have made no effort to
independently verify the facts set forth in such certificates.  Further, in making the foregoing
examinations, we have assumed the genuineness of all signatures, the legal
capacity of each person signatory to any of the documents reviewed by us, the
authenticity of all documents submitted to us as originals and the conformity
to authentic original documents of all documents submitted to us as
copies.  In making the foregoing
examinations, as to factual matters, we have assumed that all representations
and warranties made in the aforesaid documents were and are true, correct and
complete.

 

In
rendering the opinions expressed herein, we have assumed that:

 

(a)           each of the documents (other
than the Note Purchase Agreement) we examined has been duly authorized,
executed and delivered by each of the parties thereto and constitutes 

 

 

the
legal, valid and binding obligation of each such party thereto, enforceable in
accordance with its terms;

 

(b)           the Note Purchase Agreement
has been duly authorized by each of the parties thereto (other than the
Company), that each such party (other than the Company) has the requisite power
and authority to execute, deliver and perform the Note Purchase Agreement, and
that the Note Purchase Agreement constitutes the legal, valid and binding
obligations of each such party thereto (other than the Company), enforceable in
accordance with its terms;

 

(c)           no order, consent, approval,
license, authorization or validation of, or filing, recording or registration
with, or exemption by, any court, governmental authority, or any subdivision
thereof, is required to authorize or is required in connection with, the
execution and delivery by any Person identified in the Note Purchase Agreement
as a party thereto, or in connection with the performance of its obligations
thereunder or the consummation of the transactions contemplated thereby, other
than those that have been obtained or made and are in full force and effect (provided, that we make no such assumption
with respect to consents, approvals and the like applicable to the Company to
the extent that we express our opinion rendered in paragraph 4 below);

 

(d)           that there are no facts or
circumstances relating solely to the Purchasers that might prevent the
Purchasers from enforcing any of the rights to which our opinion relates; and

 

(e)           there are no extrinsic
agreements or understandings among the parties to the Note Purchase Agreement
that would modify or affect the interpretation of the terms of the Note
Purchase Agreement or the respective rights or obligations of the parties
thereunder.

 

Based
upon the foregoing, and upon an examination of such questions of law as we have
considered necessary or appropriate, and subject to the assumptions, exceptions,
qualifications and limitations set forth herein, we advise you that, in our
opinion:

 

1.             The Company is a corporation
validly existing and in good standing under the laws of the State of Delaware
and has the corporate power to execute and deliver the Note Purchase Agreement
and to perform its obligations thereunder.

 

2.             The Note Purchase Agreement
has been duly authorized, executed and delivered by the Company and constitutes
the legal, valid and binding agreement of the Company, enforceable against the
Company in accordance with its terms.

 

3.             The Company’s execution and
delivery of, and the performance of its obligations under, the Note Purchase
Agreement do not (a) contravene, or result in a violation of, the Restated
Certificate of Incorporation or the Amended and Restated Bylaws of the Company,
in each case, as in effect on the date hereof (after giving effect to any
amendment thereto), (b) contravene, result in any breach or violation of,
or constitute a default (or give rise to any right of termination, cancellation
or acceleration) under, any existing obligation of the Company pursuant to the
express provisions of the Existing Credit Facility or any agreement or
instrument in effect on the date hereof to which the Company is a party and
that has been identified as a 

 

2

 

material agreement in the exhibits to the Company’s
Annual Report on Form 10-K for the fiscal year ended December 31,
2009 and Quarterly Reports on Form 10-Q for the fiscal quarters ended March 31,
2010 and June 30, 2010, other than the Credit Agreement, dated as of October 5,
2009, by and among the Company, the lenders party thereto from time to time,
Bank of America, N.A., and Bank of America Securities LLC, which has been replaced
by the Existing Credit Facility, or (c) violate any provision of any
Applicable Laws (as hereinafter defined) applicable to the Company.

 

4.             No consent, approval or
authorization of or registration, designation, declaration or filing with, any
United States Federal or New York state governmental authority or pursuant to
the General Corporation Law of the State of Delaware (the “DGCL”) is
required as a condition to the execution and delivery by the Company of the
Note Purchase Agreement or the performance by the Company of its obligations
thereunder.  Please note that United
States Federal securities law require the filing of Current Reports on Form 8-K
with the Securities and Exchange Commission with respect to the execution and
delivery of the Note Purchase Agreement. 
Based in part upon the representations and warranties of each of the
Purchasers set forth in the Note Purchase Agreement, it is not necessary in
connection with the offering of the Notes and the execution and delivery of the
Note Purchase Agreement to register the Notes to be sold and delivered
thereunder under the Securities Act, or to qualify an indenture in respect of
said Notes under the Trust Indenture Act of 1939, as amended.

 

5.             The Company is not an “investment
company” or a company “controlled” by an “investment company,” each as defined
in or subject to regulation under the Investment Company Act of 1940, as
amended.

 

To
our knowledge, except as otherwise specifically disclosed in the Disclosure
Documents, there is no action, suit or proceeding before or by any court,
arbitrator or governmental agency, body or official, now pending, to which the
Company or any Subsidiary of the Company is a party or to which the business,
assets or property of the Company or any Subsidiary of the Company is subject
and, to our knowledge, no such action, suit or proceeding is threatened to
which the Company or any Subsidiary of the Company or the business, assets or
property of the Company or any Subsidiary of the Company would be subject that
in either case questions the validity of the Note Purchase Agreement.

 

The
foregoing opinions and statement are subject to the following assumptions,
exceptions, qualifications and limitations.

 

A.            The foregoing opinions are
expressly limited to matters under and governed by the DGCL, and applicable
Federal laws of the United States of America and the internal substantive laws
of the State of New York.  With respect
to laws, regulations and the like referred to herein, in addition to all other
limitations set forth herein, such references are limited to laws, regulations
and the like of the DGCL, and such applicable Federal laws of the United States
of America and laws of the State of New York as each is in effect and force as
of even date of this opinion and which, in our experience, are normally
applicable to the transactions of the type provided for in the Note Purchase
Agreement, in each case, however, 

 

3

 

exclusive of, and without
regard to, any Excluded Laws (collectively, the “Applicable Laws”).  The term “Excluded Laws” means all
(A) municipal, political subdivision (whether created or enabled through
legislative action at the federal, state, regional or local level), local and
county ordinances, statutes, administrative decisions, laws, rules and
regulations, and (B) statutes, laws, rules and regulations relating
to (1) pollution or protection of the environment, (2) zoning, land
use, building or construction, (3) operation of any asset or property,
(4) labor, employment, employee rights and benefits, or occupational
safety and health, (5)  utility regulation or regulation of matters
pertaining to the acquisition, transportation, transmission, storage or use of
energy sources used in connection therewith or generated thereby,
(6) antitrust, (7) taxation and (8) except as set forth in the
opinion in paragraph 4 above, securities laws and laws applicable to the
regulation of broker dealers, in each case with respect to each of the
foregoing, (x) as interpreted, construed or enforced pursuant to any
judicial, arbitral or other decision or pronouncement, (y) as in effect in
any jurisdiction, including, without limitation, any State of the United States
of America and the United States of America, and (z) including, without
limitation, any and all authorizations, permits, consents, applications,
licenses, approvals, filings, registrations, publications, exemptions and the
like required by any of them.

 

B.            The foregoing opinion
regarding the enforceability of the Note Purchase Agreement is subject to the
following:

 

(1)           The enforceability of the
Note Purchase Agreement may be limited or affected by (a) bankruptcy,
insolvency, reorganization, moratorium, liquidation, rearrangement, probate,
conservatorship, fraudulent transfer, fraudulent conveyance and other similar
laws (including court decisions) now or hereafter in effect and affecting the
rights and remedies of creditors generally or providing for the relief of
debtors generally, (b) the refusal of a particular court to grant (i) equitable
remedies, including, without limiting the generality of the foregoing, specific
performance and injunctive relief, or (ii) a particular remedy sought
under the Note Purchase Agreement as opposed to another remedy provided for
therein or another remedy available at law or in equity, (c) general
principles of equity (regardless of whether such remedies are sought in a
proceeding in equity or at law), and (d) judicial discretion.

 

(2)           We express no opinion as to
the validity or enforceability of any provision of the Note Purchase Agreement
that purports to: (a) waive or otherwise affect any right, warranty or
defense that cannot be waived or otherwise affected as a matter of law,
(b) negate the effect of any course of dealing or any exercise, or failure
or delay to exercise, any right, power, privilege or remedy, (c) relate to
indemnities or contribution, or the exculpation, release or exemption of a
party from liability, to the extent prohibited by 

 

4

 

public policy or otherwise
prohibited by applicable federal or state law, or require indemnification or
contribution (as applicable) for, or release, exculpation or exemption of a
party from, liability on account of fraud, negligence, recklessness, gross
negligence, willful misconduct, breach of the performance of an agreed
undertaking, violation of law or illegal conduct (or the public policy
underlying such action or conduct) of any Person seeking or asserting the
benefit of such indemnity, exculpation, release, exemption or contribution
provision, (d) limit liability of any Person to claims for gross
negligence or willful misconduct, (e) authorize conclusive determinations
by any party or permit a party to make determinations in its sole discretion,
(f) restrict or otherwise affect jurisdiction, venue, submission to, or
acceptance of, a court’s jurisdiction, objections to the laying of venue or
submission or acceptance of jurisdiction, limitation periods or other
procedural rights in any proceeding, (g) waive or otherwise restrict or
deny access to jury trial, claims, causes of action or remedies that may be
available or asserted in any action, or (h) permit modification thereof
only by means of an agreement signed in writing by the parties thereto.

 

(3)           We express no opinion as to
the validity or enforceability of any provision of the Note Purchase Agreement
that states that (a) prohibition, illegality, invalidity or
unenforceability of any provision of the Note Purchase Agreement in any jurisdiction
shall not (1) invalidate the remaining provisions of the Note Purchase
Agreement or (2) affect that provision in any other jurisdiction, or (b) the
right of any Person to exercise any right or remedy on the basis of any
misrepresentation or breach of warranty is not affected by any action by any
Purchaser.

 

(4)           We note that the
enforceability of specific provisions of the Note Purchase Agreement may be
subject to standards of reasonableness, care and diligence and “good faith” and
similar limitations and obligations provided for under applicable principles of
common law and judicial decisions.

 

C.            In rendering the opinion
expressed in paragraph 1 above relating to existence and good standing, as to
factual matters set forth therein we have relied solely upon a review of
certificates of public officials, without further investigation as to matters
set forth therein, and such opinion is limited to the dates of such
certificates.

 

D.            In giving the opinion in
paragraph 3, we have assumed that the proceeds of the issuance of the Notes
shall be used in accordance with the terms of the Note Purchase Agreement.

 

E.             Our opinions expressed in
paragraphs 3 and 4 above as to violations of laws, rules or regulations
applicable to the Company and as to the need for any approvals or 

 

5

 

consents of, or any
registrations or filings with, any federal, New York or Delaware corporate
governmental authority, is based upon a review of those laws, rules and
regulations that, in our experience, are normally applicable to the
transactions contemplated by the Note Purchase Agreement.  We express no opinion with respect to the
laws, rules and regulations applicable to the regulation of broker
dealers.  Further, our opinion expressed in
paragraph 4 above does not encompass compliance with, or exemptions from, the
registration and prospectus delivery requirements of the Federal securities
laws, except as expressly set forth therein.  Further, we express no opinion
herein with respect to compliance with any of the anti-fraud provisions of
applicable Federal or state securities laws, rules or regulations.

 

F.             With respect to references
herein to “known to us”, “to our knowledge” or words or phrases of similar
import (whether or not modified by any additional phrases), such references
mean the actual knowledge that those attorneys of this Firm, who, based upon
our records as of the date hereof, devoted substantive attention to the
transactions to which this opinion relates, have obtained from the following,
which constituted the examination for the purposes of the applicable
opinions:  (A) their review of
documents in connection with rendering this opinion, and the due diligence
performed in connection therewith, which review and due diligence were limited
to reviewing the Note Purchase Agreement and the Notes, the exhibits and
schedules thereto, the stock record books, by-laws and charter documents of the
Company, and certificates of officers of the Company, and which due diligence
did not include any examination of courts, boards, other tribunals or public
records with respect to any litigation, investigation or proceedings, or
judgments, orders or decrees, in any event applicable to the Company or any of
its properties; (B) their participation in the negotiation of the Note
Purchase Agreement and the Notes; and (C) representations and warranties as
to factual matters of any of the Company set forth in the Note Purchase
Agreement and the Notes, or otherwise made to us in certifications and other
writings.

 

The
opinions expressed herein are solely for the benefit of, and may only be relied
upon by, each of the Purchasers listed in Schedule A to the Note Purchase
Agreement and its respective institutional successors and assigns in connection
with the Note Purchase Agreement and the Notes (provided that any reliance by
any successor or assign shall be to the opinions expressed herein as of the
date of this opinion letter and shall not constitute a reissuance of such
opinions as of any date subsequent to the date of this opinion letter) and may
be used only for the purposes set forth in the Note Purchase Agreement.  The opinions expressed herein are as of the
date hereof (and not as of any other date) or, to the extent a reference to a
certificate or other document is made herein, to the date thereof, and we make
no undertaking to amend or supplement such opinions as facts and circumstances
come to our attention or changes in the law occur which could affect such
opinions.

 

6

 

	
   

  	
  Very
  truly yours,

  
	
   

  	
   

  

 

7

 

EXHIBIT A

 

Purchasers

 

Metropolitan Life
Insurance Company

 

MetLife Investors
Insurance Company

 

MetLife Insurance Company
of Connecticut

 

MetLife Insurance Company
of Connecticut, on behalf of its Separate Account MGA

 

Midland National Life
Insurance Company

 

North
American Company for Life and Health Insurance

 

Security
Benefit Life Insurance Company

 

Genworth Life and Annuity
Insurance Company

 

Genworth Life Insurance
Company

 

John Hancock Life
Insurance Company (U.S.A.)

 

John Hancock Life
Insurance Company of New York

 

JPMorgan Chase Bank as
Directed Trustee for the SBC Master Pension Trust

 

The Northwestern Mutual
Life Insurance Company

 

Knights of Columbus

 

The Union Central Life
Insurance Company

 

Acacia Life Insurance
Company

 

Ameritas Life Insurance
Corp.

 

 

 

Exhibit 4.4(a)(ii)

 

Form of Special Counsel to the Company Closing Opinion

 

January 13, 2011

 

To
the Purchasers Listed on Exhibit A

 

Re:          Waddell & Reed
Financial, Inc.

 

Ladies
and Gentlemen:

 

We
have acted as counsel to Waddell & Reed Financial, Inc., a Delaware
corporation (the “Company”), in connection with that certain Note
Purchase Agreement, dated as of August 31, 2010 by and among the Company
and the Purchasers identified on Schedule A thereto (such agreement without
Exhibits and Schedules thereto being hereinafter referred to as the “Note
Purchase Agreement”).  This opinion
is being delivered to you pursuant to Section 4.4(a)(ii) of the Note
Purchase Agreement.  All capitalized
terms used herein and not otherwise defined herein shall have the same meanings
herein as set forth in the Note Purchase Agreement.  Additionally, the term “Covered Documents”
shall mean the Note Purchase Agreement and the Notes.

 

In
connection with this opinion, we have examined the Covered Documents and the
Exhibits and Schedules thereto, and such documents, corporate records and
questions of law as we deem necessary for the purposes of this opinion.  We have also examined such certificates of
public officials, corporate officers of the Company and of other Persons as we
have deemed relevant and appropriate as a basis for the opinions expressed
herein, and we have made no effort to independently verify the facts set forth
in such certificates.  Further, in making
the foregoing examinations, we have assumed the genuineness of all signatures,
the legal capacity of each person signatory to any of the documents reviewed by
us, the authenticity of all documents submitted to us as originals and the
conformity to authentic original documents of all documents submitted to us as
copies.  In making the foregoing
examinations, as to factual matters, we have assumed that all representations
and warranties made in the aforesaid documents were and are true, correct and
complete.

 

In
rendering the opinions expressed herein, we have assumed that:

 

 

(a)           each of the documents (other
than the Covered Documents) we examined has been duly authorized, executed and
delivered by each of the parties thereto and constitutes the legal, valid and
binding obligation of each such party thereto, enforceable in accordance with
its terms;

 

(b)           each of the Covered
Documents has been duly authorized by each of the parties thereto (other than
the Company), that each such party (other than the Company) has the requisite
power and authority to execute, deliver and perform the Covered Documents, and
that each of the Covered Documents constitutes the legal, valid and binding
obligations of each such party thereto (other than the Company), enforceable in
accordance with its terms;

 

(c)           no order, consent, approval,
license, authorization or validation of, or filing, recording or registration
with, or exemption by, any court, governmental authority, or any subdivision
thereof, is required to authorize or is required in connection with, the
execution and delivery by any Person identified in the Covered Documents as a
party thereto, or in connection with the performance of its obligations
thereunder or the consummation of the transactions contemplated thereby, other
than those that have been obtained or made and are in full force and effect (provided, that we make no such assumption
with respect to consents, approvals and the like applicable to the Company to
the extent that we express our opinion rendered in paragraph 4 below);

 

(d)           that there are no facts or
circumstances relating solely to the Purchasers that might prevent the
Purchasers from enforcing any of the rights to which our opinion relates; and

 

(e)           there are no extrinsic
agreements or understandings among the parties to the Covered Documents that
would modify or affect the interpretation of the terms of the Covered Documents
or the respective rights or obligations of the parties thereunder.

 

Based
upon the foregoing, and upon an examination of such questions of law as we have
considered necessary or appropriate, and subject to the assumptions,
exceptions, qualifications and limitations set forth herein, we advise you
that, in our opinion:

 

1.             The Company is a corporation
validly existing and in good standing under the laws of the State of Delaware
and has the corporate power to execute and deliver the Notes and to perform its
obligations under the Covered Documents.

 

2.             The Notes have been duly
authorized, executed and delivered by the Company and constitute the legal,
valid and binding obligations of the Company, enforceable against the Company
in accordance with its terms.

 

3.             The Company’s execution and
delivery of, and the performance of its obligations under, the Covered
Documents do not (a) contravene, or result in a violation of, the Restated
Certificate of Incorporation or the Amended and Restated Bylaws of the Company,
in each case, as in effect on the date hereof (after giving effect to any
amendment thereto), (b) contravene, result in any breach or violation of,
or constitute a default (or give rise to any right of termination, cancellation
or acceleration) under, any existing obligation of the Company 

 

2

 

pursuant to the express provisions of the Existing
Credit Facility or any agreement or instrument in effect on the date hereof to
which the Company is a party and that has been identified as a material
agreement in the exhibits to the Company’s Annual Report on Form 10-K for
the fiscal year ended December 31, 2009 and Quarterly Reports on Form 10-Q
for the fiscal quarters ended March 31, 2010, June 30, 2010, and September 30,
2010 or (c) violate any provision of any Applicable Laws (as hereinafter
defined) applicable to the Company.

 

4.             No consent, approval or
authorization of or registration, designation, declaration or filing with, any
United States Federal or New York state governmental authority or pursuant to
the General Corporation Law of the State of Delaware (the “DGCL”) is
required as a condition to the execution and delivery by the Company of the
Covered Documents or the performance by the Company of its obligations
thereunder.  Please note that United
States Federal securities law require the filing of Current Reports on Form 8-K
with the Securities and Exchange Commission with respect to the execution and
delivery of the Covered Documents.  Based
in part upon the representations and warranties of each of the Purchasers set
forth in the Note Purchase Agreement, it is not necessary in connection with
the offering, sale and delivery of the Notes and the execution and delivery of
the Note Purchase Agreement to register the Notes to be sold and delivered
thereunder under the Securities Act, or to qualify an indenture in respect of
said Notes under the Trust Indenture Act of 1939, as amended.

 

5.             The borrowings by the
Company under the Covered Documents and the application of the proceeds thereof
as provided in the Note Purchase Agreement will not violate Regulation T, U or
X of the Board of Governors of the Federal Reserve System.

 

6.             The Company is not an “investment
company” or a company “controlled” by an “investment company,” each as defined
in or subject to regulation under the Investment Company Act of 1940, as
amended.

 

To
our knowledge, except as otherwise specifically disclosed in the Disclosure
Documents, there is no action, suit or proceeding before or by any court,
arbitrator or governmental agency, body or official, now pending, to which the
Company or any Subsidiary of the Company is a party or to which the business,
assets or property of the Company or any Subsidiary of the Company is subject
and, to our knowledge, no such action, suit or proceeding is threatened to
which the Company or any Subsidiary of the Company or the business, assets or
property of the Company or any Subsidiary of the Company would be subject that
in either case questions the validity of the Covered Documents.

 

The
foregoing opinions and statement are subject to the following assumptions,
exceptions, qualifications and limitations.

 

A.            The foregoing opinions are
expressly limited to matters under and governed by the DGCL, and applicable
Federal laws of the United States of America and the internal substantive laws
of the State of New York and except as provided in paragraph 4 above, we
express no opinion as to any federal or state securities laws.  With respect to laws, regulations and the
like referred to herein, in addition to all other limitations set forth herein,
such references are limited to laws, 

 

3

 

regulations and the like of
the DGCL, and such applicable Federal laws of the United States of America and
laws of the State of New York as each is in effect and force as of even date of
this opinion and which, in our experience, are normally applicable to the
transactions of the type provided for in the Covered Documents, in each case,
however, exclusive of, and without regard to, any Excluded Laws (collectively,
the “Applicable Laws”).  The term “Excluded
Laws” means all (A) municipal, political subdivision (whether created or
enabled through legislative action at the federal, state, regional or local
level), local and county ordinances, statutes, administrative decisions, laws, rules and
regulations, and (B) statutes, laws, rules and regulations relating
to (1) pollution or protection of the environment, (2) zoning, land
use, building or construction, (3) operation of any asset or property,
(4) labor, employment, employee rights and benefits, or occupational
safety and health, (5)  utility regulation or regulation of matters pertaining
to the acquisition, transportation, transmission, storage or use of energy
sources used in connection therewith or generated thereby, (6) antitrust,
(7) taxation and (8) except as set forth in the opinion in paragraph
4 above, securities laws and laws applicable to the regulation of broker
dealers, in each case with respect to each of the foregoing, (x) as
interpreted, construed or enforced pursuant to any judicial, arbitral or other
decision or pronouncement, (y) as in effect in any jurisdiction,
including, without limitation, any State of the United States of America and
the United States of America, and (z) including, without limitation,
any and all authorizations, permits, consents, applications, licenses,
approvals, filings, registrations, publications, exemptions and the like
required by any of them.

 

B.            The foregoing opinion
regarding the enforceability of the Covered Documents is subject to the
following:

 

(1)           The enforceability of the
Covered Documents may be limited or affected by (a) bankruptcy,
insolvency, reorganization, moratorium, liquidation, rearrangement, probate,
conservatorship, fraudulent transfer, fraudulent conveyance and other similar
laws (including court decisions) now or hereafter in effect and affecting the
rights and remedies of creditors generally or providing for the relief of
debtors generally, (b) the refusal of a particular court to grant (i) equitable
remedies, including, without limiting the generality of the foregoing, specific
performance and injunctive relief, or (ii) a particular remedy sought
under any Covered Document as opposed to another remedy provided for therein or
another remedy available at law or in equity, (c) general principles of
equity (regardless of whether such remedies are sought in a proceeding in
equity or at law), and (d) judicial discretion.

 

(2)           We express no opinion as to
the validity or enforceability of any provision of any Covered Document that
purports to: (a) waive or otherwise affect any right, warranty or defense
that cannot be waived or otherwise affected 

 

4

 

as a matter of law,
(b) negate the effect of any course of dealing or any exercise, or failure
or delay to exercise, any right, power, privilege or remedy, (c) relate to
indemnities or contribution, or the exculpation, release or exemption of a
party from liability, to the extent prohibited by public policy or otherwise
prohibited by applicable federal or state law, or require indemnification or
contribution (as applicable) for, or release, exculpation or exemption of a
party from, liability on account of fraud, negligence, recklessness, gross
negligence, willful misconduct, breach of the performance of an agreed
undertaking, violation of law or illegal conduct (or the public policy
underlying such action or conduct) of any Person seeking or asserting the
benefit of such indemnity, exculpation, release, exemption or contribution
provision, (d) limit liability of any Person to claims for gross
negligence or willful misconduct, (e) authorize conclusive determinations
by any party or permit a party to make determinations in its sole discretion,
(f) restrict or otherwise affect jurisdiction, venue, submission to, or
acceptance of, a court’s jurisdiction, objections to the laying of venue or
submission or acceptance of jurisdiction, limitation periods or other
procedural rights in any proceeding, (g) waive or otherwise restrict or
deny access to jury trial, claims, causes of action or remedies that may be
available or asserted in any action, or (h) permit modification thereof
only by means of an agreement signed in writing by the parties thereto.

 

(3)           We express no opinion as to
the validity or enforceability of any provision of any Covered Document that
states that (a) prohibition, illegality, invalidity or unenforceability of
any provision of any Covered Document in any jurisdiction shall not (1) invalidate
the remaining provisions of any Covered Document or (2) affect that
provision in any other jurisdiction, or (b) the right of any Person to
exercise any right or remedy on the basis of any misrepresentation or breach of
warranty is not affected by any action by any Purchaser.

 

(4)           We note that the
enforceability of specific provisions of the Covered Documents may be subject
to standards of reasonableness, care and diligence and “good faith” and similar
limitations and obligations provided for under applicable principles of common
law and judicial decisions.

 

C.            In rendering the opinion
expressed in paragraph 1 above relating to existence and good standing, as to
factual matters set forth therein, we have relied solely upon a review of
certificates of public official, without further investigation as to matters
set forth therein, and such opinion is limited to the dates of such
certificates.

 

5

 

D.            In giving the opinions in
paragraphs 3 and 5, we have assumed that the proceeds of the issuance of the
Notes shall be used in accordance with the terms of the Note Purchase
Agreement.

 

E.             Our opinions expressed in
paragraphs 3 and 4 above as to violations of laws, rules or regulations
applicable to the Company and as to the need for any approvals or consents of,
or any registrations or filings with, any federal, New York or Delaware
corporate governmental authority, is based upon a review of those laws, rules and
regulations that, in our experience, are normally applicable to the
transactions contemplated by the Covered Documents.  We express no opinion with respect to the
laws, rules and regulations applicable to the regulation of broker
dealers.  Further, our opinion expressed
in paragraph 4 above does not encompass compliance with, or exemptions from,
the registration and prospectus delivery requirements of the Federal securities
laws, except as expressly set forth therein.  Further, we express no opinion
herein with respect to compliance with any of the anti-fraud provisions of
applicable Federal or state securities laws, rules or regulations.

 

F.             In rendering our opinions in
paragraph 4 above, we have assumed that the Purchasers will comply with the
restrictions on transfer set forth in the Covered Documents.  Further, we have assumed that neither the
Company nor any Person acting on its behalf engaged in a general solicitation
or used advertising in connection with the offer and sale of the  Notes.  We express no
opinion with respect to any transfer of the Notes.

 

G.            With respect to references
herein to “known to us”, “to our knowledge” or words or phrases of similar
import (whether or not modified by any additional phrases), such references
mean the actual knowledge that those attorneys of this Firm, who, based upon
our records as of the date hereof, devoted substantive attention to the
transactions to which this opinion relates, have obtained from the following,
which constituted the examination for the purposes of the applicable
opinions:  (A) their review of
documents in connection with rendering this opinion, and the due diligence
performed in connection therewith, which review and due diligence were limited
to reviewing the Note Purchase Agreement and the Notes, the exhibits and
schedules thereto, the stock record books, by-laws and charter documents of the
Company, and certificates of officers of the Company, and which due diligence
did not include any examination of courts, boards, other tribunals or public
records with respect to any litigation, investigation or proceedings, or
judgments, orders or decrees, in any event applicable to the Company or any of
its properties; (B) their participation in the negotiation of the Covered
Documents; and (C) representations and warranties as to factual matters of
any of the Company set forth in the Covered Documents, or otherwise made to us
in certifications and other writings.

 

6

 

The
opinions expressed herein are solely for the benefit of, and may only be relied
upon by, each of the Purchasers listed in Schedule A to the Note Purchase
Agreement and its respective institutional successors and assigns in connection
with the Covered Documents (provided that any reliance by any successor or
assign shall be to the opinions expressed herein as of the date of this opinion
letter and shall not constitute a reissuance of such opinions as of any date
subsequent to the date of this opinion letter) and may be used only for the
purposes set forth in the Note Purchase Agreement.  The opinions expressed herein are as of the
date hereof (and not as of any other date) or, to the extent a reference to a
certificate or other document is made herein, to the date thereof, and we make
no undertaking to amend or supplement such opinions as facts and circumstances
come to our attention or changes in the law occur which could affect such
opinions.

 

	
   

  	
  Very
  truly yours,

  
	
   

  	
   

  

 

7

 

EXHIBIT A

 

Purchasers

 

Metropolitan Life
Insurance Company

 

MetLife Investors
Insurance Company

 

MetLife Insurance Company
of Connecticut

 

MetLife Insurance Company
of Connecticut, on behalf of its Separate Account MGA

 

Midland National Life
Insurance Company

 

North American Company
for Life and Health Insurance

 

Security Benefit Life
Insurance Company

 

Genworth Life and Annuity
Insurance Company

 

Genworth Life Insurance
Company

 

John Hancock Life
Insurance Company (U.S.A.)

 

John Hancock Life
Insurance Company of New York

 

JPMorgan Chase Bank as
Directed Trustee for the SBC Master Pension Trust

 

The Northwestern Mutual
Life Insurance Company

 

Knights of Columbus

 

The Union Central Life
Insurance Company

 

Acacia Life Insurance
Company

 

Ameritas Life Insurance
Corp.

 

 

 

EXHIBITS 4.4(b)(i) and
4.4(b)(ii)

 

Forms of Opinions of Internal Counsel to the Company

 

 

 

Exhibit 4.4(b)(i)

 

Form of Internal Counsel to the Company Signing Opinion

 

August 31, 2010

 

To the Purchasers Listed on Exhibit A

 

Re:                               Note Purchase Agreement
dated as of August 31, 2010 (the “Note Purchase Agreement”) among
Waddell & Reed Financial, Inc. and the Purchasers identified on
Schedule A thereto

 

Ladies and Gentlemen:

 

I
am General Counsel of Waddell & Reed Financial, Inc. (the “Company”).  As General Counsel, I have been
requested to provide you my opinion as to certain matters in connection with
the preparation, execution and delivery of the Note Purchase Agreement.  Unless otherwise indicated, capitalized terms
used but not defined herein shall have the respective meanings set forth in the
Note Purchase Agreement.  This opinion is
furnished to you pursuant to Section 4.4(b)(i) of the Note Purchase
Agreement.

 

In
connection with this opinion, I have (a) examined (i) the Note
Purchase Agreement, signed by the Company and by the Purchasers, (ii) the
forms of the Notes attached as Exhibits 1(a) and 1(b) to the Note
Purchase Agreement, (iii) originals, or duplicates or certified or
conformed copies, of such records, agreements, instruments and other documents,
(iv) such certificates of public officials, of officers and
representatives of the Company and other Persons, and (b) made such other
investigations as I have deemed relevant and necessary in connection with the
opinions expressed herein, and I have made no effort to independently verify
the facts set forth in such certificates.

 

In
making the foregoing examinations, I have assumed the genuineness of all
signatures (other than the signatures of the Company), the legal capacity of
each person signatory to any of the documents reviewed by me, the authenticity
of all documents submitted to me as originals, the conformity to original
documents of all documents submitted to me as duplicates or certified or
conformed copies, and the authenticity of the originals of such latter
documents.  I have relied, as to factual
matters, on the statements of the Company set forth in the Note Purchase
Agreement and the certificates referenced above, without undertaking any
independent investigation of such factual matters, unless I know such
statements not to be true and correct.

 

Based
upon and subject to the foregoing, and subject to the assumptions, exceptions,
qualifications and limitations set forth herein, I am of the opinion that:

 

 

1.             Each of the
Company and its Subsidiaries (a) has been duly incorporated or formed and
is validly existing and in good standing as a corporation or limited liability
company, as applicable, under the laws of the jurisdiction in which it was so
incorporated or formed, (b) is duly qualified to do business as a foreign
corporation or limited liability company, as applicable, in each jurisdiction
where its activities require such qualification except where the failure to so
qualify would not, individually or in the aggregate, have a Material Adverse
Effect, and (c) has the corporate or limited liability company, as
applicable, power and authority to own or hold under lease the properties it
purports to own or hold under lease and to transact the business it transacts
and proposes to transact and, in the case of the Company, to execute and
deliver the Note Purchase Agreement and the Notes and to perform its
obligations thereunder.

 

2.             The Company (a) has
duly authorized, by all requisite corporate action, the execution, delivery and
performance of its obligations under the Note Purchase Agreement and the Notes
and (b) has duly executed and delivered the Note Purchase Agreement.

 

3.             The Company’s
execution and delivery of, and performance of its obligations under, the Note
Purchase Agreement do not (a) contravene, or result in any violation of,
any corporate charter, certificate of formation, bylaws or limited liability
company agreement, as applicable of the Company or any Subsidiary of the
Company, in each case, as in effect on the date hereof (after giving effect to
any amendment thereto), (b) contravene, result in any breach or violation
of, or constitute a default (or give rise to any right of termination,
cancellation or acceleration) under, any existing obligation of the Company or
any Subsidiary of the Company pursuant to the express provisions of the
Existing Credit Facility or any material indenture, mortgage, deed of trust,
loan, purchase or credit agreement, lease or any other material agreement or
instrument, in each case, in effect on the date hereof to which the Company or
any Subsidiary of the Company is a party or by which the Company or any
Subsidiary of the Company or any of their respective properties may be bound or
affected, other than the Credit Agreement, dated as of October 5, 2009, by
and among the Company, the lenders party thereto from time to time, Bank of
America, N.A., and Bank of America Securities LLC, which has been replaced by
the Existing Credit Facility, (c) conflict in any material respect with or
result in a material breach or violation of any of the terms, conditions or
provisions of any order, judgment, decree or ruling of any court, arbitrator or
Governmental Authority applicable to the Company or any Subsidiary of the
Company or (d) violate any provision of any Applicable Laws (as
hereinafter defined) applicable to the Company or any Subsidiary of the Company.

 

4.             Neither the
Company nor any Subsidiary of the Company is an “investment company” or a
company “controlled” by an “investment company,” each as defined in, or subject
to regulation under the Investment Company Act of 1940, as amended.

 

5.             Under
Applicable Law, no consent, approval or authorization of, or designation,
declaration or filing with, any Governmental Authority is required as a
condition to the execution and delivery by the Company of the Note Purchase
Agreement

 

2

 

or
the performance by the Company of its obligations thereunder.  Please note that United States Federal
securities law require the filing of Current Reports on Form 8-K with the
Securities and Exchange Commission with respect to the execution and delivery
of the Note Purchase Agreement.

 

To
my knowledge, except as otherwise disclosed, there is no action, suit or
proceeding before or by any court, arbitrator or governmental agency, body or
official, now pending, to which the Company or any Subsidiary of the Company is
a party or to which the business, assets or property of the Company or any
Subsidiary of the Company is subject and, to my knowledge, no such action, suit
or proceeding is threatened to which the Company or any Subsidiary of the
Company or the business, assets or property of the Company or any Subsidiary of
the Company would be subject that in either case questions the validity of the
Note Purchase Agreement or, individually or in the aggregate, could reasonably
be expected to have a Material Adverse Effect.

 

The
foregoing opinions and statement are subject to the following assumptions,
exceptions, qualifications and limitations.

 

(a)           The foregoing opinions are
expressly limited to matters under and governed by the General Corporation Law
of the State of Delaware, applicable Federal laws of the United States of
America, and the laws of the States of Kansas and Missouri, in each case in
effect on the date hereof and which, in my experience, are normally applicable to
the transactions of the type provided for in the Note Purchase Agreement, in
each case, however, exclusive of, and without regard to, any Excluded Laws
(collectively, the “Applicable Laws”). 
The term “Excluded Laws” means all (A) municipal, political
subdivision (whether created or enabled through legislative action at the
federal, state, regional or local level), local and county ordinances,
statutes, administrative decisions, laws, rules and regulations, and
(B) statutes, laws, rules and regulations relating to
(1) pollution or protection of the environment, (2) zoning, land use,
building or construction, (3) operation of any asset or property,
(4) labor, employment, employee rights and benefits, or occupational
safety and health, (5)  utility regulation or regulation of matters
pertaining to the acquisition, transportation, transmission, storage or use of
energy sources used in connection therewith or generated thereby,
(6) antitrust, (7) taxation and (8) except as set forth in the
opinion in paragraph 4 above, securities laws and laws applicable to the
regulation of broker dealers, in each case with respect to each of the
foregoing, (x) as interpreted, construed or enforced pursuant to any
judicial, arbitral or other decision or pronouncement, (y) as in effect in
any jurisdiction, including, without limitation, any State of the United States
of America and the United States of America, and (z) including,
without limitation, any and all authorizations, permits, consents,
applications, licenses, approvals, filings, registrations, publications,
exemptions and the like required by any of them.

 

(b)           In rendering the opinion
expressed in paragraph 1 above regarding valid existence and good standing, I
have relied solely on certificates of public officials of a recent date, and
have conducted no further investigation.

 

3

 

(c)           Whenever any opinion
expressed herein with respect to the existence or absence of facts is qualified
by references to “known to me,” “to my knowledge” or words or phrases of
similar import (whether or not modified by any additional phrases), such
qualification indicates that, except as otherwise expressed, (i) no
information has come to my attention that has given me actual knowledge of the
existence of such facts, and (ii) I have not undertaken any independent
investigation to determine the existence or absence of such facts.

 

My
opinion is limited to the Applicable Laws, as appropriate, and is based on the
facts in existence and the laws in effect on the date hereof.  In rendering this opinion, note that I am a
member of the bar of the States of Kansas and Missouri.

 

The
opinions expressed herein are solely for the benefit of, and may only be relied
upon by, each of the Purchasers listed in Schedule A to the Note Purchase
Agreement and its respective institutional successors and assigns in connection
with the Note Purchase Agreement and the Notes (provided that any reliance by
any successor or assign shall be to the opinions expressed herein as of the
date of this opinion letter and shall not constitute a reissuance of such
opinions as of any date subsequent to the date of this letter) and may be used
only for the purposes set forth in the Note Purchase Agreement.  The opinions expressed herein are as of the
date hereof (and not as of any other date) or, to the extent a reference to a
certificate or other document is made herein, to the date thereof, and I make
no undertaking to amend or supplement such opinions as facts and circumstances
come to my attention or changes in the law occur which could affect such
opinions.

 

	
   

  	
  Very
  truly yours,

  
	
   

  	
   

  

 

4

 

EXHIBIT A

 

Purchasers

 

Metropolitan Life
Insurance Company

 

MetLife Investors
Insurance Company

 

MetLife Insurance Company
of Connecticut

 

MetLife Insurance Company
of Connecticut, on behalf of its Separate Account MGA

 

Midland National Life
Insurance Company

 

North American Company
for Life and Health Insurance

 

Security Benefit Life
Insurance Company

 

Genworth Life and Annuity
Insurance Company

 

Genworth Life Insurance
Company

 

John Hancock Life
Insurance Company (U.S.A.)

 

John Hancock Life
Insurance Company of New York

 

JPMorgan Chase Bank as
Directed Trustee for the SBC Master Pension Trust

 

The Northwestern Mutual
Life Insurance Company

 

Knights of Columbus

 

The Union Central Life
Insurance Company

 

Acacia Life Insurance
Company

 

Ameritas Life Insurance
Corp.

 

 

Exhibit 4.4(b)(ii)

 

Form of Internal Counsel to the
Company Closing Opinion

 

January 13, 2011

 

To the Purchasers Listed on Exhibit A

 

Re:                               Note Purchase Agreement
dated as of August 31, 2010 (the “Note Purchase Agreement”) among
Waddell & Reed Financial, Inc. and the Purchasers identified on Schedule A
thereto

 

Ladies and Gentlemen:

 

I
am General Counsel of Waddell & Reed Financial, Inc. (the “Company”).  As General Counsel, I have been requested to
provide you my opinion as to certain matters in connection with the
preparation, execution and delivery of the Note Purchase Agreement and the
Notes (collectively, the “Note Documents”).  Unless otherwise indicated, capitalized terms
used but not defined herein shall have the respective meanings set forth in the
Note Purchase Agreement.  This opinion is
furnished to you pursuant to Section 4.4(b)(ii) of the Note Purchase Agreement.

 

In
connection with this opinion, I have examined the Note Purchase Agreement,
signed by the Company and by the Purchasers, and the Notes, each executed by
the Company.  In addition to the Note
Documents, I have (a) examined (i) the originals, or duplicates or certified or
conformed copies, of such records, agreements, instruments and other documents
and (ii) such certificates of public officials, of officers and representatives
of the Company and other Persons, and (b) made such other investigations as I
have deemed relevant and necessary in connection with the opinions expressed
herein, and I have made no effort to independently verify the facts set forth
in such certificates.

 

In
making the foregoing examinations, I have assumed the genuineness of all
signatures (other than the signatures of the Company), the legal capacity of
each person signatory to any of the documents reviewed by me, the authenticity
of all documents submitted to me as originals, the conformity to original
documents of all documents submitted to me as duplicates or certified or
conformed copies, and the authenticity of the originals of such latter
documents.  I have relied, as to factual
matters, on the statements of the Company set forth in the Note Purchase
Agreement and the certificates referenced above, without undertaking any
independent investigation of such factual matters, unless I know such
statements not to be true and correct.

 

 

Based
upon and subject to the foregoing, and subject to the assumptions, exceptions,
qualifications and limitations set forth herein, I am of the opinion that:

 

1.             Each of the Company and its
Subsidiaries (a) has been duly incorporated or formed and is validly existing
and in good standing as a corporation or limited liability company, as
applicable, under the laws of the jurisdiction in which it was so incorporated
or formed, (b) is duly qualified to do business as a foreign corporation or
limited liability company, as applicable, in each jurisdiction where its
activities require such qualification except where the failure to so qualify
would not, individually or in the aggregate, have a Material Adverse Effect,
and (c) has the corporate or limited liability company, as applicable, power
and authority to own or hold under lease the properties it purports to own or
hold under lease and to transact the business it transacts and proposes to
transact and, in the case of the Company, to execute and deliver the Notes and
to perform its obligations under the Note Documents.

 

2.             The Company (a) has duly
authorized, by all requisite corporate action, the execution, delivery and
performance of its obligations under the Note Documents and (b) has duly
executed and delivered the Notes.

 

3.             The Company’s execution and
delivery of, and performance of its obligations under, the Note Documents do
not (a) contravene, or result in any violation of, any corporate charter,
certificate of formation, bylaws or limited liability company agreement, as
applicable of the Company or any Subsidiary of the Company, in each case, as in
effect on the date hereof (after giving effect to any amendment thereto), (b)
contravene, result in any breach or violation of, or constitute a default (or
give rise to any right of termination, cancellation or acceleration) under, any
existing obligation of the Company or any Subsidiary of the Company pursuant to
the express provisions of the Existing Credit Facility or any material indenture,
mortgage, deed of trust, loan, purchase or credit agreement, lease or any other
material agreement or instrument, in each case, in effect on the date hereof to
which the Company or any Subsidiary of the Company is a party or by which the
Company or any Subsidiary of the Company or any of their respective properties
may be bound or affected, (c) conflict in any material respect with or result
in a material breach or violation of any of the terms, conditions or provisions
of any order, judgment, decree or ruling of any court, arbitrator or
Governmental Authority applicable to the Company or any Subsidiary of the
Company or (d) violate any provision of any Applicable Laws (as hereinafter
defined) applicable to the Company or any Subsidiary of the Company.

 

4.             Neither the Company nor any
Subsidiary of the Company is an “investment company” or a company “controlled”
by an “investment company,” each as defined in, or subject to regulation under
the Investment Company Act of 1940, as amended.

 

5.             Under Applicable Law, no
consent, approval or authorization of, or designation, declaration or filing
with, any Governmental Authority is required as a condition to the execution
and delivery by the Company of the Note Documents or the performance by the
Company of its obligations thereunder. 
Please note that United 

 

2

 

States Federal securities law require the filing of
Current Reports on Form 8-K with the Securities and Exchange Commission with
respect to the execution and delivery of the Note Documents.

 

To
my knowledge, except as otherwise disclosed, there is no action, suit or
proceeding before or by any court, arbitrator or governmental agency, body or
official, now pending, to which the Company or any Subsidiary of the Company is
a party or to which the business, assets or property of the Company or any
Subsidiary of the Company is subject and, to my knowledge, no such action, suit
or proceeding is threatened to which the Company or any Subsidiary of the Company
or the business, assets or property of the Company or any Subsidiary of the
Company would be subject that in either case questions the validity of the Note
Documents or, individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect.

 

The
foregoing opinions and statement are subject to the following assumptions,
exceptions, qualifications and limitations.

 

(a)           The foregoing opinions are
expressly limited to matters under and governed by the General Corporation Law
of the State of Delaware, applicable Federal laws of the United States of
America, and the laws of the States of Kansas and Missouri, in each case in
effect on the date hereof and which, in my experience, are normally applicable
to the transactions of the type provided for in the Note Documents, in each
case, however, exclusive of, and without regard to, any Excluded Laws
(collectively, the “Applicable Laws”). 
The term “Excluded Laws” means all (A) municipal, political
subdivision (whether created or enabled through legislative action at the
federal, state, regional or local level), local and county ordinances,
statutes, administrative decisions, laws, rules and regulations, and
(B) statutes, laws, rules and regulations relating to (1) pollution
or protection of the environment, (2) zoning, land use, building or
construction, (3) operation of any asset or property, (4) labor,
employment, employee rights and benefits, or occupational safety and health,
(5)  utility regulation or regulation of matters pertaining to the
acquisition, transportation, transmission, storage or use of energy sources
used in connection therewith or generated thereby, (6) antitrust,
(7) taxation and (8) except as set forth in the opinion in paragraph
4 above, securities laws and laws applicable to the regulation of broker
dealers, in each case with respect to each of the foregoing, (x) as
interpreted, construed or enforced pursuant to any judicial, arbitral or other
decision or pronouncement, (y) as in effect in any jurisdiction,
including, without limitation, any State of the United States of America and
the United States of America, and (z) including, without limitation,
any and all authorizations, permits, consents, applications, licenses,
approvals, filings, registrations, publications, exemptions and the like
required by any of them.

 

(b)           In rendering the opinion
expressed in paragraph 1 above regarding valid existence and good standing, I
have relied solely on certificates of public officials of a recent date, and
have conducted no further investigation.

 

(c)           Whenever any opinion
expressed herein with respect to the existence or absence of facts is qualified
by references to “known to me,” “to my knowledge” or 

 

3

 

words or phrases of similar import (whether or not
modified by any additional phrases), such qualification indicates that, except
as otherwise expressed, (i) no information has come to my attention that has
given me actual knowledge of the existence of such facts, and (ii) I have not
undertaken any independent investigation to determine the existence or absence
of such facts.

 

My
opinion is limited to the Applicable Laws, as appropriate, and is based on the
facts in existence and the laws in effect on the date hereof.  In rendering this opinion, note that I am a
member of the bar of the States of Kansas and Missouri.

 

The
opinions expressed herein are solely for the benefit of, and may only be relied
upon by, each of the Purchasers listed in Schedule A to the Note Purchase
Agreement and its respective institutional successors and assigns in connection
with the Note Documents (provided that any reliance by any successor or assign
shall be to the opinions expressed herein as of the date of this opinion letter
and shall not constitute a reissuance of such opinions as of any date
subsequent to the date of this letter) and may be used only for the purposes
set forth in the Note Purchase Agreement. 
The opinions expressed herein are as of the date hereof (and not as of
any other date) or, to the extent a reference to a certificate or other
document is made herein, to the date thereof, and I make no undertaking to
amend or supplement such opinions as facts and circumstances come to my
attention or changes in the law occur which could affect such opinions.

 

	
   

  	
  Very
  truly yours,

  
	
   

  	
   

  

 

4

 

EXHIBIT A

 

Purchasers

 

Metropolitan Life
Insurance Company

 

MetLife Investors
Insurance Company

 

MetLife Insurance Company
of Connecticut

 

MetLife Insurance Company
of Connecticut, on behalf of its Separate Account MGA

 

Midland National Life
Insurance Company

 

North American Company
for Life and Health Insurance

 

Security Benefit Life
Insurance Company

 

Genworth Life and Annuity
Insurance Company

 

Genworth Life Insurance
Company

 

John Hancock Life
Insurance Company (U.S.A.)

 

John Hancock Life
Insurance Company of New York

 

JPMorgan Chase Bank as
Directed Trustee for the SBC Master Pension Trust

 

The Northwestern Mutual
Life Insurance Company

 

Knights of Columbus

 

The Union Central Life
Insurance Company

 

Acacia Life Insurance
Company

 

Ameritas Life Insurance
Corp.

 

 

EXHIBITS 4.4(c)(i) and 4.4(c)(ii)

 

Forms of Opinions of Special Counsel to the Purchasers

 

 

Exhibit 4.4(c)(i)

 

Form of Special Counsel to the Purchasers Signing Opinion

 

January 13,
2011

 

	
   

  	
  Re:

  	
  Waddell &
  Reed Financial, Inc.

  
	
   

  	
   

  	
  5.00%
  Senior Notes, Series A, due 2018

  
	
   

  	
   

  	
  5.75%
  Senior Notes, Series B, due 2021

  

 

To
the several Purchasers listed in 

Schedule
A to the within-mentioned 

Note
Purchase Agreement

 

Ladies
and Gentlemen:

 

We
have acted as your special counsel in connection with the issuance by Waddell &
Reed Financial, Inc. (the “Company”)
of $95,000,000 aggregate principal amount of its 5.00% Senior Notes, Series A,
due 2018 (the “Series A Notes”) and $95,000,000 aggregate principal amount
of its 5.75% Senior Notes, Series B, due 2021 (the “Series B Notes”).  The Series A Notes and the Series B
Notes (collectively, the “Notes”) are being purchased by you on this date under
and pursuant to the Note Purchase Agreement, dated as of August 31, 2010
(the “Note Purchase Agreement”), by and among you and the Company, in the
respective series and aggregate principal amounts set forth in Schedule A
to the Note Purchase Agreement.  All
capitalized terms used herein without definition shall have the meanings
ascribed thereto in the Note Purchase Agreement.

 

We
have examined such corporate records of the Company, agreements and other
instruments, certificates of officers and representatives of the Company,
certificates of public officials, and such other documents, as we have deemed
necessary in connection with the opinions hereinafter expressed.  In such examination we have assumed the
genuineness of all signatures, the authenticity of documents submitted to us as
originals and the conformity with the authentic originals of all documents
submitted to us as copies.  As to
questions of fact material to such opinions, we have, when relevant facts were
not independently established, relied upon the representations set forth in the
Note Purchase Agreement and upon certifications by officers or other
representatives of the Company.

 

 

In
addition, we attended the closing held today at our office at which you purchased
and made payment for Notes of the series and in the respective aggregate
principal amounts to be purchased by you, all in accordance with the Note
Purchase Agreement.

 

Based
upon the foregoing and having regard for legal considerations that we deem relevant,
we render our opinion to you pursuant to Section 4.4(c)(ii) of the
Note Purchase Agreement as follows:

 

1.             The Company is a validly existing
corporation in good standing under the laws of the State of Delaware and has
the corporate power to execute and deliver the Notes and perform its
obligations thereunder.

 

2.             The Notes being purchased by you
today have been duly authorized, executed and delivered and constitute legal,
valid and binding obligations of the Company, enforceable against the Company
in accordance with their terms.

 

3.             No consent, approval or
authorization of, or declaration, registration or filing with, any New York or
United States Federal Governmental Authority by the Company is required for the
validity of the execution, delivery or performance by the Company of said
Notes.

 

4.             It was not necessary in connection
with the offering, sale and delivery of said Notes, under the circumstances
contemplated by the Note Purchase Agreement, to register said Notes under the
Securities Act of 1933, as amended, or to qualify an indenture in respect of
the Notes under the Trust Indenture Act of 1939, as amended.

 

5.             The opinions of even date herewith
of Fulbright & Jaworski L.L.P., special counsel for the Company, and
Daniel C. Schulte, Esq., Senior Vice President and General Counsel of the
Company, delivered to you pursuant to Sections 4.4(a)(ii) and 4.4(b)(ii) of
the Note Purchase Agreement, respectively, are satisfactory to us in form and
scope with respect to the matters respectively specified therein and we believe
that you are justified in relying thereon.

 

The
opinions expressed above as to the enforceability of any agreement or
instrument in accordance with its terms are subject to the exceptions that
(a) such enforceability may be limited by (i) applicable bankruptcy,
insolvency, reorganization, moratorium and similar laws affecting the
enforcement of creditors’ rights generally and (ii) general equitable
principles (regardless of whether such enforceability is considered in a
proceeding in equity or at law) and (b) the enforceability of indemnity
provisions contained in the Note Purchase Agreement may be subject to
limitations based upon public policy considerations.

 

We
express no opinion as to (a) whether a court outside the State of New York
will honor the choice of New York law to govern the Note Purchase Agreement and
the Notes, (b) Section 22.8 of the Note Purchase Agreement insofar as
said Section relates to (i) the waiver of the right to jury trial,
(ii) the subject matter jurisdiction of a United States Federal court
sitting in New York to adjudicate any controversy relating to the Note Purchase
Agreement or the Notes or 

 

2

 

(iii) the
waiver of inconvenient forum with respect to proceedings in any such United
States Federal court, or (c) any provisions of the Note Purchase Agreement
or the Notes which purport to provide for a rate of interest after judgment.

 

We
have made no examination of and express no opinion today with respect to any
matter covered by our opinion dated August 31, 2010 and delivered to you
on such date in connection with the execution and delivery of the Note Purchase
Agreement.

 

We
are members of the bar of the State of New York and do not herein intend to
express any opinion as to any matters governed by any laws other than United
States Federal laws and the laws of the State of New York and the General
Corporation Law of the State of Delaware.

 

This
opinion is given solely for your benefit, and for the benefit of other
institutional investor holders from time to time of the Notes purchased by you
today, in connection with the closing held today of the transactions
contemplated by the Note Purchase Agreement, and may not be relied upon by any
other person for any purpose without our prior written consent.

 

	
   

  	
  Very
  truly yours,

  

 

3

 

Exhibit 4.4(c)(ii)

 

Form of Special Counsel to the Purchasers Closing Opinion

 

August 31, 2010

 

	
   

  	
  Re:

  	
  Waddell
  & Reed Financial, Inc.

  
	
   

  	
   

  	
  5.00%
  Senior Notes, Series A, due 2018

  
	
   

  	
   

  	
  5.75%
  Senior Notes, Series B, due 2021

  

 

To
the several Purchasers listed in 

Schedule A to the within-mentioned 

Note Purchase Agreement

 

Ladies
and Gentlemen:

 

We
have acted as your special counsel in connection with the proposed issuance by
Waddell & Reed Financial, Inc. (the “Company”) of $95,000,000 aggregate
principal amount of its 5.00% Senior Notes, Series A, due 2018 and $95,000,000
aggregate principal amount of its 5.75% Senior Notes, Series B, due 2021
(collectively, the “Notes”) pursuant to the Note Purchase Agreement, dated as
of August 31, 2010 (the “Note Purchase Agreement”), by and among you and the
Company.  All capitalized terms used
herein without definition shall have the meanings ascribed thereto in the Note
Purchase Agreement.

 

We
have examined such corporate records of the Company, agreements and other
instruments, certificates of officers and representatives of the Company,
certificates of public officials, and such other documents, as we have deemed
necessary in connection with the opinions hereinafter expressed.  In such examination we have assumed the
genuineness of all signatures, the authenticity of documents submitted to us as
originals and the conformity with the authentic originals of all documents
submitted to us as copies.  As to
questions of fact material to such opinions, we have, when relevant facts were
not independently established, relied upon the representations set forth in the
Note Purchase Agreement and upon certifications by officers or other
representatives of the Company.

 

 

Based
upon the foregoing and having regard for legal considerations that we deem
relevant, we render our opinion to you pursuant to Section 4.4(c)(i) of the
Note Purchase Agreement as follows:

 

1.             The Company is a validly existing
corporation in good standing under the laws of the State of Delaware and has
the corporate power to execute and deliver the Note Purchase Agreement and
perform its obligations thereunder.

 

2.             The Note Purchase Agreement has
been duly authorized, executed and delivered by the Company and constitutes a
legal, valid and binding agreement of Company, enforceable against the Company
in accordance with its terms.

 

3.             No consent, approval or
authorization of, or declaration, registration or filing with, any New York or
United States Federal Governmental Authority is required to be obtained or made
as a condition to the validity of the execution and delivery by the Company of
the Note Purchase Agreement or for the performance by the Company of its
obligations thereunder.

 

4.             It was not necessary in connection
with the offering of the Notes under the circumstances contemplated by the Note
Purchase Agreement to register the Notes to be sold and delivered thereunder
under the Securities Act of 1933, as amended, or to qualify an indenture in
respect of the Notes under the Trust Indenture Act of 1939, as amended.

 

5.             The opinions of even date herewith
of Fulbright & Jaworski L.L.P., special counsel for the Company, and Daniel
C. Schulte, Esq., Senior Vice President and General Counsel of the Company,
delivered to you pursuant to Sections 4.4(a)(i) and 4.4(b)(i) of the Note
Purchase Agreement, respectively, are satisfactory to us in form and scope with
respect to the matters respectively specified therein and we believe that you
are justified in relying thereon.

 

The
opinions expressed above as to the enforceability of any agreement or
instrument in accordance with its terms are subject to the exceptions that
(a) such enforceability may be limited by (i) applicable bankruptcy,
insolvency, reorganization, moratorium and similar laws affecting the enforcement
of creditors’ rights generally and (ii) general equitable principles
(regardless of whether such enforceability is considered in a proceeding in
equity or at law) and (b) the enforceability of indemnity provisions
contained in the Note Purchase Agreement may be subject to limitations based
upon public policy considerations.

 

We
express no opinion as to (a) whether a court outside the State of New York
will honor the choice of New York law to govern the Note Purchase Agreement and
the Notes, (b) Section 22.8 of the Note Purchase Agreement insofar as said
Section relates to (i) the waiver of the right to jury trial,
(ii) the subject matter jurisdiction of a United States Federal court
sitting in New York to adjudicate any controversy relating to the Note Purchase
Agreement or the Notes or (iii) the waiver of inconvenient forum with
respect to proceedings in any such United States Federal court, or 

 

2

 

(c) any
provisions of the Note Purchase Agreement or the Notes which purport to provide
for a rate of interest after judgment.

 

We
are members of the bar of the State of New York and do not herein intend to
express any opinion as to any matters governed by any laws other than United
States Federal laws, the laws of the State of New York and the General
Corporation Law of the State of Delaware.

 

3

 

This
opinion is given solely for your benefit and for the benefit of institutional
investor holders from time to time of the Notes purchased by you pursuant to
the Note Purchase Agreement, in connection with the transactions contemplated
by the Note Purchase Agreement, and may not be relied upon by any other person
for any purpose without our prior written consent.

 

	
   

  	
  Very
  truly yours,

  

 

4

 

EXHIBIT 7.1(f)(i)

 

Form of Report on Net Asset Values

 

 

EXHIBIT 7.1(f)(i)

 

W A D D E L
L  &  R E E D  F I N A N C I A L, I N C.

Mutual Fund Management Fees by Fund Family

2010 Actual ($000)

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  % Inc (Dec)

  	
   

  	
  Total

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  % of

  	
   

  	
  YTD Mgmt

  	
   

  	
  Variance

  	
   

  	
  2009

  	
   

  	
  Year

  	
   

  
	
   

  	
   

  	
  Jan

  	
   

  	
  Feb

  	
   

  	
  Mar

  	
   

  	
  Apr

  	
   

  	
  May

  	
   

  	
  Jun

  	
   

  	
  Jul

  	
   

  	
  Aug

  	
   

  	
  Sep

  	
   

  	
  Oct

  	
   

  	
  Nov

  	
   

  	
  Dec

  	
   

  	
  Y-T-D

  	
   

  	
  Total

  	
   

  	
  Fee Rate

  	
   

  	
  From L-Y

  	
   

  	
  Actual

  	
   

  	
  2009

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W&R Advisors Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Accumulative

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cash Management

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Continental Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Investment

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Government Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  New Concepts

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Retirement Shares

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tax-Managed Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Vanguard

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W&R Advisors Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy New Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Capital Appreciation

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cundill Global Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  European Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Natural Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Large Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Limited-Term Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed European/Pacific

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed International Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Micro Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pacific Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real Estate Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

W A D D E L
L  &  R E E D  F I N A N C I A L, I N C.

Mutual Fund Management Fees by Fund Family

2010 Actual ($000)

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  % Inc (Dec)

  	
   

  	
  Total

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  % of

  	
   

  	
  YTD Mgmt

  	
   

  	
  Variance

  	
   

  	
  2009

  	
   

  	
  Year

  	
   

  
	
   

  	
   

  	
  Jan

  	
   

  	
  Feb

  	
   

  	
  Mar

  	
   

  	
  Apr

  	
   

  	
  May

  	
   

  	
  Jun

  	
   

  	
  Jul

  	
   

  	
  Aug

  	
   

  	
  Sep

  	
   

  	
  Oct

  	
   

  	
  Nov

  	
   

  	
  Dec

  	
   

  	
  Y-T-D

  	
   

  	
  Total

  	
   

  	
  Fee Rate

  	
   

  	
  From L-Y

  	
   

  	
  Actual

  	
   

  	
  2009

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy VIP Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Natural Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Micro Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real Estate Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy VIP Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Grand Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fixed

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Daily Average

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

	
  Change in Mutual Fund Assets Under Management

  	
  July 2010

  	
   

  
	
  (Millions)

  	
  Month to Date

  	
  Exhibit C-1

  

 

	
   

  	
   

  	
  Net Assets

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Net

  	
   

  	
  Net

  	
   

  	
  Dividends

  	
   

  	
  Net Investment

  	
   

  	
  Dividends

  	
   

  	
  Valuation

  	
   

  	
  Net Assets

  	
   

  
	
   

  	
   

  	
  at 6-30-10

  	
   

  	
  Sales

  	
   

  	
  Redemptions

  	
   

  	
  Sales

  	
   

  	
  Exchanges

  	
   

  	
  Reinvested

  	
   

  	
  Income

  	
   

  	
  Paid

  	
   

  	
  Change

  	
   

  	
  at 7-31-10

  	
   

  
	
  Waddell & Reed Advisors
  Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Accumulative

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cont Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Investment

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Government Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  New Concepts

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tax-Managed Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Vanguard

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Allocation Pass-Thru (MAP/SPA)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal of Long -Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cash Management

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Waddell & Reed Advisors
  Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy New Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Capital Appreciation

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cundill Global Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  European Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Natural Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Large Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Limited-Term Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed European/Pacific

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed Int’l Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Microcap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pacific Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real Estate

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tax-Managed Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal of Long -Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal of Money Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less Eliminations- Underlying
  Funds of Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

	
  Change in Mutual Fund Assets Under Management

  	
  July 2010

  	
   

  
	
  (Millions)

  	
  Month to Date

  	
   

  

 

	
   

  	
   

  	
  Net Assets

  at 6-30-10

  	
   

  	
  Sales

  	
   

  	
  Redemptions

  	
   

  	
  Net

  Sales

  	
   

  	
  Net

  Exchanges

  	
   

  	
  Dividends

  Reinvested

  	
   

  	
  Net Investment

  Income

  	
   

  	
  Dividends

  Paid

  	
   

  	
  Valuation

  Change

  	
   

  	
  Net Assets

  at 7-31-10

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Conservative

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy VIP Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced Port

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Natural Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Inc

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Microcap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Mkt

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder- Agressive Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder- Conservative Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder- Moderate Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder- Moderately Agressive Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder- Moderately Conservative Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real Estate

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Port

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less Eliminations- Underlying
  Funds of Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy VIP Funds Total *

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Summary of All Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Long-Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Market Funds **

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less Eliminations- Underlying
  InvestEd Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  All Mutual Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

*All
Ivy VIP Funds are considered to be Long-Term Mutual Funds. For the Ivy VIP
Funds only sales include exchanges in and redemptions include exchanges out.

**Money
Market Funds consists of Advisors Cash Management and Invested Cash
Reserves, Ivy Money Market and Ivy Cash Reserves.

(1) Eliminations-
Underlying Funds of Funds — These eliminations are to prevent double counting due
to reporting both at the fund of fund and underlying fund levels.

 

	
  BY INVESTMENT MANAGER

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Sub-Advised Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W&R Managed Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  % BY INVESTMENT MANAGER

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Sub-Advised Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W&R Managed Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

	
  Change in Mutual Fund Assets Under Management

  	
  July 2010

  	
   

  
	
  (Millions)

  	
  Year to Date

  	
   

  

 

	
   

  	
   

  	
  Net Assets

  at 12-31-09

  	
   

  	
  Sales

  	
   

  	
  Redemptions

  	
   

  	
  Net

  Sales

  	
   

  	
  Net

  Exchanges

  	
   

  	
  Dividends

  Reinvested

  	
   

  	
  Net Investment

  Income

  	
   

  	
  Dividends

  Paid

  	
   

  	
  Valuation

  Change

  	
   

  	
  Net Assets

  at 7-31-2010

  	
   

  
	
  Waddell & Reed Advisors
  Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Accumulative

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cont Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Investment

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Government Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  New Concepts

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tax-Managed Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Vanguard

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Allocation Pass-Thru (MAP/SPA)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal of Long -Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cash Management

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Waddell & Reed Advisors
  Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy New Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Capital Appreciation

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cundill Global Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  European Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Natural Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Large Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Limited-Term Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed European/Pacific

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Managed Int’l Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Microcap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Municipal High Income

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pacific Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real Estate

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tax-Managed Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subtotal of Long -Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Market

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less Eliminations- Underlying
  Funds of Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

	
  Change in Mutual Fund Assets Under Management

  	
  July 2010

  	
   

  
	
  (Millions)

  	
  Year to Date

  	
   

  

 

	
   

  	
   

  	
  Net Assets

  at 12-31-09

  	
   

  	
  Sales

  	
   

  	
  Redemptions

  	
   

  	
  Net

  Sales

  	
   

  	
  Net

  Exchanges

  	
   

  	
  Dividends

  Reinvested

  	
   

  	
  Net Investment

  Income

  	
   

  	
  Dividends

  Paid

  	
   

  	
  Valuation

  Change

  	
   

  	
  Net Assets

  at 7-31-2010

  	
   

  
	
  InvestEd Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Balanced

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Conservative

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  InvestEd Funds Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy VIP Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Asset Strategy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balanced Port

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bond

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Core Equity

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dividend Opportunities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Energy

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Global Natural Resources

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  High Inc

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  International Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Microcap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mid Cap Growth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Mkt

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mortgage Securities

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder- Agressive Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder- Conservative Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder- Moderate Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder- Moderately Agressive Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pathfinder- Moderately Conservative Portfolio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Real Estate

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Science & Technology

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Port

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Small Cap Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Value

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less Eliminations- Underlying
  Funds of Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ivy VIP Funds Total*

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Summary of All Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Long-Term Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Money Market Funds **

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less Eliminations- Underlying
  InvestEd Funds (1)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  All Mutual Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

*All
Ivy VIP Funds are considered to be Long-Term Mutual Funds. For the Ivy Vip
Funds only sales include exchanges in and redemptions include exchanges out.

**Money
Market Funds consists of Advisors Cash Management and Invested Cash
Reserves, Ivy Money Market and Ivy Cash Reserves.

(1) Eliminations-
Underlying Funds of Funds — These eliminations are to prevent double counting
due to reporting both at the fund of fund and underlying fund levels.

 

	
  BY INVESTMENT MANAGER

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Sub-Advised Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W&R Managed Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  % BY INVESTMENT MANAGER

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Sub-Advised Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  W&R Managed Funds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

EXHIBIT 7.1(f)(ii)

 

Form of Report on Aggregate Revenue Base

 

 

EXHIBIT 7.1(f)(ii)

 

	
   

  	
  Waddell & Reed Financial, Inc. -
  Consolidated

  	
   

  
	
   

  	
  Statement of Operations

  	
   

  
	
   

  	
  For the period indicated in each column heading

  	
   

  
	
   

  	
  Dollar amounts in thousands except per share amounts

  	
   

  

 

	
   

  	
   

  	
  QTD

  Aug-2010

  	
   

  	
  QTD

  May-2010

  	
   

  	
  Variance

  Dollars

  	
   

  	
  Variance

  Percent

  	
   

  	
  QTD

  Aug-2010

  	
   

  	
  QTD

  Aug-2009

  	
   

  	
  Variance

  Dollars

  	
   

  	
  Variance

  Percent

  	
   

  	
  YTD

  Aug-2010

  	
   

  	
  YTD

  Aug-2009

  	
   

  	
  Variance

  Dollars

  	
   

  	
  Variance

  Percent

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  REVENUES:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Investment Management Fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Underwriting & Distribution fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Shareholder Service Fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Revenue Allocation

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL REVENUE

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

	
   

  	
   

  	
  Aug-2009

  	
   

  	
  Sep-2009

  	
   

  	
  Oct-2009

  	
   

  	
  Nov-2009

  	
   

  	
  Dec-2009

  	
   

  	
  Jan-2010

  	
   

  	
  Feb-2010

  	
   

  	
  Mar-2010

  	
   

  	
  Apr-2010

  	
   

  	
  May-2010

  	
   

  	
  Jun-2010

  	
   

  	
  Jul-2010

  	
   

  	
  Aug-2010

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  REVENUES:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Investment Management Fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Underwriting & Distribution fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Shareholder Service Fees

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Revenue Allocation

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL REVENUE

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00178-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00178-of-00352.parquet"}]]