<SUBMISSION>
<ACCESSION-NUMBER>0001072613-04-001472
<TYPE>10-Q
<PUBLIC-DOCUMENT-COUNT>8
<PERIOD>20040630
<FILING-DATE>20040809
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>BOSTON SCIENTIFIC CORP
<CIK>0000885725
<ASSIGNED-SIC>3841
<IRS-NUMBER>042695240
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>10-Q
<ACT>34
<FILE-NUMBER>001-11083
<FILM-NUMBER>04961577
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>ONE BOSTON SCIENTIFIC PL
<CITY>NATICK
<STATE>MA
<ZIP>01760-1537
<PHONE>5086508000
</BUSINESS-ADDRESS>
</FILER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>form10-q_12848.txt
<DESCRIPTION>FORM 10-Q FOR PERIOD ENDED 6/30/04
<TEXT>
================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    FORM 10-Q


/x/         QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
            ACT OF 1934

            For the quarterly period ended: June 30, 2004


                         Commission file number: 1-11083


                          BOSTON SCIENTIFIC CORPORATION
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)

            DELAWARE                                             04-2695240
  ----------------------------                                ----------------
  (State or other jurisdiction                                (I.R.S. Employer
of incorporation or organization)                            Identification No.)

  One Boston Scientific Place, Natick, Massachusetts             01760-1537
  --------------------------------------------------             ----------
        (Address of principal executive offices)                 (Zip Code)

Registrant's telephone number, including area code:  (508) 650-8000


Former name, former address and former fiscal year, if changed since last
report.

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

            Yes  [X]                              No  [_]

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).

            Yes  [X]                              No  [_]

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the last practicable date.

                                                       Shares Outstanding
            Class                                      as of June 30, 2004
            -----                                      -------------------

Common Stock, $.01 Par Value                               842,167,705

================================================================================
<PAGE>


                                TABLE OF CONTENTS

PART I      FINANCIAL INFORMATION                                       PAGE NO.

ITEM 1.         Condensed Consolidated Financial Statements                 3

                Condensed Consolidated Balance Sheets                       3

                Condensed Consolidated Statements of Operations             5

                Condensed Consolidated Statements of Cash Flows             6

                Notes to Condensed Consolidated Financial Statements        7

ITEM 2.         Management's Discussion and Analysis of Financial
                Condition and Results of Operations                        21

ITEM 3.         Quantitative and Qualitative Disclosures About
                Market Risk                                                39

ITEM 4.         Controls and Procedures                                    40



PART II     OTHER INFORMATION                                              42

ITEM 1.         Legal Proceedings                                          42

ITEM 4.         Submission of Matters to a Vote of Security Holders        42

ITEM 6.         Exhibits and Reports on Form 8-K                           43

SIGNATURES                                                                 44


                                       2
<PAGE>

                                     Part I
                              Financial Information

Item 1: Condensed Consolidated Financial Statements


BOSTON SCIENTIFIC CORPORATION AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(Unaudited)

<TABLE><CAPTION>
                                                                         June 30,       December 31,
in millions                                                                2004             2003
--------------------------------------------------------------------------------------------------
<S>                                                                     <C>             <C>
ASSETS
Current assets:
   Cash and cash equivalents                                            $    1,000      $      671
   Short-term investments                                                      263              81
   Trade accounts receivable, net                                              814             542
   Inventories                                                                 279             281
   Other current assets                                                        318             305
                                                                        --------------------------
         Total current assets                                                2,674           1,880

Property, plant and equipment                                                1,483           1,337
Less: accumulated depreciation                                                 669             593
                                                                        --------------------------
                                                                               814             744


Goodwill                                                                     1,699           1,275
Other intangible assets, net                                                 1,634           1,186
Investments                                                                    510             558
Other assets                                                                   101              56
                                                                        --------------------------
                                                                        $    7,432      $    5,699
                                                                        ==========================
</TABLE>


See notes to the unaudited condensed consolidated financial statements.

                                       3
<PAGE>

BOSTON SCIENTIFIC CORPORATION AND SUBSIDIARIES
Condensed Consolidated Balance Sheets (continued)
(Unaudited)
<TABLE><CAPTION>
                                                                          June 30,      December 31,
in millions, except share data                                             2004             2003
--------------------------------------------------------------------------------------------------
<S>                                                                     <C>             <C>
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
   Commercial paper                                                     $      279      $      547
   Notes payable and current maturities of long-term debt                      513               6
   Accounts payable and accrued expenses                                       696             675
   Other current liabilities                                                    98             165
                                                                        --------------------------
         Total current liabilities                                           1,586           1,393

Long-term debt                                                               1,762           1,172
Deferred income taxes                                                          268             151
Other long-term liabilities                                                    112             121


Commitments and contingencies

Stockholders' equity:
   Preferred stock, $ .01 par value - authorized 50,000,000 shares,
      none issued and outstanding
   Common stock, $ .01 par value - authorized 1,200,000,000 shares,
      842,167,705 shares issued at June 30, 2004; 829,764,826
      shares issued at December 31, 2003                                         8               8
   Additional paid-in capital                                                1,505           1,225
   Treasury stock, at cost - 3,502,850 shares at December 31, 2003                            (111)
   Retained earnings                                                         2,235           1,789
   Accumulated other comprehensive loss                                        (44)            (49)
                                                                        --------------------------
  Total stockholders' equity                                                 3,704           2,862
                                                                        --------------------------
                                                                        $    7,432      $    5,699
                                                                        ==========================
</TABLE>

See notes to the unaudited condensed consolidated financial statements.

                                       4
<PAGE>

BOSTON SCIENTIFIC CORPORATION AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(Unaudited)

<TABLE><CAPTION>
                                                        Three Months Ended               Six Months Ended
                                                              June 30,                       June 30,
in millions, except per share data                     2004            2003            2004            2003
--------------------------------------------------------------------------------------------------------------
<S>                                                 <C>             <C>             <C>             <C>
Net sales                                           $    1,460      $      854      $    2,542      $    1,661
Cost of products sold                                      363             235             655             461
                                                    --------------------------      --------------------------
Gross profit                                             1,097             619           1,887           1,200

Selling, general and administrative expenses               375             292             723             563
Amortization expense                                        26              21              48              41
Royalties                                                   52              13              74              25
Research and development expenses                          132             108             266             211
Litigation-related charges                                                                                   7
Purchased research and development                          64              12              64              25
                                                    --------------------------      --------------------------
                                                           649             446           1,175             872
                                                    --------------------------      --------------------------
Operating income                                           448             173             712             328

Other income (expense):
   Interest expense                                        (14)            (12)            (25)            (23)
   Other, net                                               (2)                                             (4)
                                                    --------------------------      --------------------------

Income before income taxes                                 432             161             687             301
Income taxes                                               119              47             180              90
                                                    --------------------------      --------------------------
Net income                                          $      313      $      114      $      507      $      211
                                                    ==========================      ==========================

Net income per common share - basic                 $     0.37      $     0.14      $     0.61      $     0.26
                                                    ==========================      ==========================

Net income per common share - assuming dilution     $     0.36      $     0.13      $     0.59      $     0.25
                                                    ==========================      ==========================
</TABLE>

See notes to the unaudited condensed consolidated financial statements.

                                       5
<PAGE>

BOSTON SCIENTIFIC CORPORATION AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(Unaudited)

<TABLE><CAPTION>
                                                                                          Six Months Ended
                                                                                              June 30,
in millions                                                                             2004            2003
---------------------------------------------------------------------------------------------------------------
<S>                                                                                  <C>             <C>
Cash provided by operating activities                                                $      574      $      354

Investing activities:
    Purchases of property, plant and equipment, net                                        (135)            (74)
    Purchases of held-to-maturity short-term investments                                   (307)            (25)
    Purchases of available-for sale securities                                              (13)            (88)
    Maturities of held-to-maturity short term investments                                    99              17
    Sales of available-for-sale securities                                                   62
    Sales of privately held equity securities                                                28
    Acquisitions of businesses, net of cash acquired                                       (804)            (13)
    Payments related to prior year acquisitions                                             (81)           (242)
    Payments for acquisitions of and/or investments in certain technologies, net            (90)            (81)
                                                                                     --------------------------
Cash used for investing activities                                                       (1,241)           (506)

Financing activities:
    Net increase in commercial paper                                                         43             509
    Net proceeds from (payments on) revolving borrowings,                                   188            (109)
    Proceeds from (payments on) notes payable, capital leases
        and long-term borrowings                                                            589              (9)
    Purchases of common stock for treasury                                                                 (244)
    Proceeds from issuances of shares of common stock                                       177             126
                                                                                     --------------------------
Cash provided by financing activities                                                       997             273
Effect of foreign exchange rates on cash                                                     (1)              4
                                                                                     --------------------------
Net increase in cash and cash equivalents                                                   329             125
Cash and cash equivalents at beginning of period                                            671             260
                                                                                     --------------------------
Cash and cash equivalents at end of period                                           $    1,000      $      385
                                                                                     ==========================


Supplemental Schedule of Noncash Investing and Financing Activities:
    Payments due in connection with prior year acquisitions                          $       13      $       39
</TABLE>

See notes to the unaudited condensed consolidated financial statements.

                                       6
<PAGE>

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE A - BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements of Boston
Scientific Corporation (Boston Scientific or the Company) have been prepared in
accordance with accounting principles generally accepted in the United States
for interim financial information and with the instructions to Form 10-Q and
Article 10 of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by accounting principles generally accepted
in the United States for complete financial statements. In the opinion of
management, all adjustments (consisting only of normal recurring adjustments)
considered necessary for a fair presentation have been included. Operating
results for the three and six months ended June 30, 2004 are not necessarily
indicative of the results that may be expected for the year ending December 31,
2004. For further information, refer to the consolidated financial statements
and footnotes thereto incorporated by reference in Boston Scientific's Annual
Report on Form 10-K for the year ended December 31, 2003.

Certain prior year's amounts have been reclassified to conform to the current
year presentation.

NOTE B - STOCK COMPENSATION ARRANGEMENTS

The Company accounts for its stock compensation arrangements under the intrinsic
value method in accordance with Accounting Principles Board Opinion No. 25,
ACCOUNTING FOR STOCK ISSUED TO EMPLOYEES, and related Interpretations. The
Company has adopted the disclosure-only provisions of Financial Accounting
Standards Board (FASB) Statement No. 123, ACCOUNTING FOR STOCK-BASED
COMPENSATION.

If the Company had elected to recognize compensation expense for the granting of
options under stock option plans based on the fair values at the grant dates
consistent with the methodology prescribed by Statement No. 123, net income and
net income per share would have been reported as the following pro forma
amounts:

                                       7
<PAGE>

<TABLE><CAPTION>
                                                                        Three Months Ended                Six Months Ended
                                                                             June 30,                          June 30,
(in millions, except per share data)                                  2004             2003             2004             2003
-------------------------------------------------------------       --------         --------         --------         --------
<S>                                                                 <C>              <C>              <C>              <C>
Net income, as reported                                             $    313         $    114         $    507         $    211
Add: Stock-based employee compensation expense included
in net income, net of related tax effects                                                   1                                 1

Less: Total stock-based employee compensation expense
determined under fair value based method for all awards, net
of related tax effect                                                    (16)             (13)             (31)             (26)
                                                                    --------         --------         --------         --------
Pro forma net income                                                $    297         $    102         $    476         $    186
                                                                    ========         ========         ========         ========

Net income per common share:
Basic:
     Reported                                                       $   0.37         $   0.14         $   0.61         $   0.26
     Pro forma                                                      $   0.35         $   0.12         $   0.57         $   0.23
Assuming dilution:
     Reported                                                       $   0.36         $   0.13         $   0.59         $   0.25
     Pro forma                                                      $   0.35         $   0.12         $   0.56         $   0.22
</TABLE>

The fair value of the stock compensation used to calculate the pro forma net
income and earnings per share amounts above was estimated using the
Black-Scholes option pricing model.

NOTE C - COMPREHENSIVE INCOME

The following table sets forth the Company's comprehensive income for the three
months and the six months ended June 30, 2004 and 2003:

<TABLE><CAPTION>
                                                                        Three Months Ended                Six Months Ended
                                                                             June 30,                          June 30,
(in millions)                                                         2004             2003             2004             2003
-------------------------------------------------------------       --------         --------         --------         --------
<S>                                                                 <C>              <C>              <C>              <C>
Net income                                                          $    313         $    114         $    507         $    211
Foreign currency translation adjustment                                    8               16              (11)              26
Net change in equity investments                                         (16)              18              (22)              19
Net change in derivative financial instruments                            36               (3)              38               (5)

                                                                    --------         --------         --------         --------
Comprehensive income                                                $    341         $    145         $    512         $    251
                                                                    ========         ========         ========         ========
</TABLE>

NOTE D - EARNINGS PER SHARE

The following table sets forth the computations of basic and diluted earnings
per share:

                                       8
<PAGE>

<TABLE><CAPTION>
                                                    Three Months Ended        Six Months Ended
                                                          June 30,                June 30,
(in millions, except per share data)                  2004        2003        2004        2003
-----------------------------------------------     --------    --------    --------    --------
<S>                                                 <C>         <C>         <C>         <C>
Basic:
Net income                                          $    313    $    114    $    507    $    211
Weighted average shares outstanding                    839.4       820.6       835.3       821.3
Net income per common share                         $   0.37    $   0.14    $   0.61    $   0.26
                                                    ========    ========    ========    ========

Assuming dilution:
Net income                                          $    313    $    114    $    507    $    211
Weighted average shares outstanding                    839.4       820.6       835.3       821.3
Net effect of dilutive stock-based compensation         20.5        24.2        22.3        23.1
                                                    --------    --------    --------    --------
Total                                                  859.9       844.8       857.6       844.4
Net income per common share                         $   0.36    $   0.13    $   0.59    $   0.25
                                                    ========    ========    ========    ========
</TABLE>

NOTE E - BUSINESS COMBINATIONS

On June 1, 2004, the Company completed its acquisition of 100 percent of the
fully diluted equity of Advanced Bionics Corporation (Advanced Bionics) for an
initial payment of approximately $740 million in cash, plus earn out payments
that are contingent upon Advanced Bionics products reaching future performance
milestones. Advanced Bionics has developed or is developing implantable
microelectronic technologies for treating numerous neurological disorders. Its
neuromodulation technology includes a range of neurostimulators (or implantable
pulse generators), programmable drug pumps and cochlear implants. The
acquisition was intended to expand the Company's technology portfolio into the
implantable microelectronic device market. The Advanced Bionics acquisition was
structured to include earnout payments that are primarily contingent on the
achievement of future performance milestones, with certain milestone payments
also tied to profitability. The performance milestones are segmented by Advanced
Bionics' four principal technology platforms (cochlear implants, implantable
pulse generators, drug pumps and bion microstimulators), each milestone with a
72-month earnout horizon from the date of the anticipated product launch. Base
earnout payments on these performance milestones approximate two and a quarter
times incremental sales for each annual period. There are also bonus earnout
payments available based on the attainment of certain aggregate sales
performance targets and a certain gross margin level. The milestones associated
with the contingent consideration must be reached in certain future periods
ranging from 2004 through 2013.

On April 2, 2004, the Company completed its acquisition of the remaining
outstanding shares of Precision Vascular Systems, Inc. (PVS) for an initial
payment of approximately $75 million in cash, plus earnout payments that are
contingent upon PVS products reaching future performance milestones. PVS
develops and manufactures guidewires and microcatheter technology for use in
accessing the brain, the heart and other areas of the anatomy. The acquisition
of PVS was intended to provide the Company with expanded vascular access
technology and an expanded intellectual property portfolio.

Certain of the Company's business combinations involve contingent consideration.
These payments, if and when made, are allocated to specific intangible asset
categories, including purchased research and development, with the remainder
assigned to goodwill as if the

                                       9
<PAGE>

consideration had been paid as of the date of acquisition. Payment of the
additional consideration is generally contingent upon the acquired companies
reaching certain performance milestones, including achieving specified revenue
levels, product development targets or regulatory approvals. At June 30, 2004
and December 31, 2003, the Company had accruals for acquisition-related
obligations of approximately $13 million and $79 million, respectively. These
accruals were recorded primarily as adjustments to goodwill and purchased
research and development. In addition, at June 30, 2004, the estimated maximum
potential amount of future contingent consideration (undiscounted) that the
Company could be required to make associated with its business combinations is
approximately $3.2 billion, some of which may be payable in the Company's common
stock. Certain earnout payments are based on multiples of the acquired company's
revenue during the earnout period, and consequently, the total payments are not
currently determinable. However, the Company has developed an estimate of the
maximum potential contingent consideration for each of its acquisitions with an
outstanding earnout obligation. The milestones associated with the contingent
consideration must be reached in certain future periods ranging from 2004
through 2013. The estimated cumulative specified revenue level associated with
these maximum future contingent payments is approximately $7.0 billion.

The Company has recorded approximately $411 million of intangible assets not
subject to amortization associated with its 2004 acquisitions, which is
comprised solely of goodwill. The goodwill is not deductible for tax purposes,
and has been primarily allocated to the Company's U.S. reportable segment.

The following table summarizes the purchase price assigned to the intangible
assets subject to amortization acquired in connection with the 2004 acquisitions
and the weighted average amortization periods:
                                                                Weighted Average
                                                   Amount         Amortization
(in millions)                                     Assigned           Period
---------------------------------------------    ----------        ----------

Technology - core                                $      406          20 years
Technology - developed                                   42           7 years
Other                                                    10          15 years

                                                 ----------        ----------
Total                                            $      458          19 years
                                                 ==========        ==========

The Company also recorded $64 million of purchased research and development, $45
million of deferred tax assets and $169 million of deferred tax liabilities in
connection with the acquisitions of Advanced Bionics and PVS. The deferred tax
assets are primarily attributable to net operating loss carryforwards. The
deferred tax liabilities mainly relate to the tax impact of amortization that is
attributable to the identified intangibles acquired in the acquisition. The
remaining net tangible assets acquired were not significant. The amounts paid
for each acquisition have been allocated to the assets acquired and liabilities
assumed based on their fair values at the date of acquisition. The estimated
excess of purchase price over the fair value of the net tangible assets acquired
was allocated to identifiable intangible assets based on detailed valuations.
The Company's purchased research and development charges are based upon these
valuations. The valuation of purchased research and development represents the
estimated fair value at the date of acquisition related to in-process projects.
As of the date of acquisition, the in-process projects had not yet reached
technological feasibility and had no alternative future

                                       10
<PAGE>

uses. The primary basis for determining the technological feasibility of these
projects is obtaining regulatory approval to market the products in an
applicable geographical region. Accordingly, the value attributable to these
projects, which had not yet obtained regulatory approval, was expensed in
conjunction with the acquisition. If the projects are not successful, or
completed in a timely manner, the Company may not realize the financial benefits
expected for these projects.

The income approach was used to establish the fair values of purchased research
and development. This approach establishes fair value by estimating the
after-tax cash flows attributable to the in-process project over its useful life
and then discounting these after-tax cash flows back to a present value. Revenue
estimates were based on estimates of relevant market sizes, expected market
growth rates, expected trends in technology and expected product introductions
by competitors. In arriving at the value of the in-process research and
development projects, the Company considered, among other factors, the
in-process project's stage of completion, the complexity of the work completed
as of the acquisition date, the costs already incurred, the projected costs to
complete, the contribution of core technologies and other acquired assets, the
expected introduction date and the estimated useful life of the technology. The
discount rate used to arrive at a present value as of the date of acquisition
was based on the time value of money and medical technology investment risk
factors. For the purchased research and development programs acquired in
connection with the Company's 2004 acquisitions, risk-adjusted discount rates
ranging from 18 percent to 27 percent were utilized to discount the projected
cash flows. The Company believes that the estimated purchased research and
development amounts so determined represent the fair value at the date of
acquisition and do not exceed the amount a third party would pay for the
projects.

The most significant in-process projects acquired in connection with the
Company's 2004 acquisitions include Advanced Bionics' bion(TM) microstimulator
and drug delivery pump, which collectively represent approximately 77 percent of
the 2004 in-process projects value. The bion microstimulator is an implantable
neurostimulation device that may be used to treat a variety of neurological
conditions, including urge incontinence, epilepsy, sleep apnea, erectile
dysfunction and migraine headaches. The cost to complete the bion
microstimulator is estimated to be between $35 million and $45 million. The drug
delivery pump is an implanted programmable device used to treat chronic pain.
The cost to complete the drug delivery pump is estimated to be between $30
million and $40 million. As of the date of acquisition, the products were
expected to be commercially available on a worldwide basis within three to four
years.

The Company's condensed consolidated financial statements include Advanced
Bionics' and PVS' operating results from the date of acquisition. The following
unaudited pro forma information presents a summary of consolidated results of
operations of the Company and Advanced Bionics as if the acquisition had
occurred at the beginning of each of 2003 and 2004, with pro forma adjustments
to give effect to amortization of intangible assets, an increase in interest
expense on acquisition financing and certain other adjustments together with
related tax effects:

                                       11
<PAGE>

<TABLE><CAPTION>
                                                   Three Months Ended:             Six Months Ended:
                                                        June 30,                        June 30,
(in millions, except per share data)              2004            2003            2004            2003
-------------------------------------------     --------        --------        --------        --------
<S>                                             <C>             <C>             <C>             <C>
Net sales                                       $  1,482        $    863        $  2,583        $  1,679
Net income                                           298              99             478             183

Net income per share - basic                    $   0.36        $   0.12        $   0.57        $   0.22
Net income per share - assuming dilution        $   0.35        $   0.12        $   0.56        $   0.22
</TABLE>

Pro forma information is not presented for PVS, as PVS' results of operations
prior to its date of acquisition are not significant in relation to the
Company's consolidated results.

NOTE F - BORROWINGS AND CREDIT ARRANGEMENTS

During the first half of 2004, the Company refinanced its existing $1,200
million credit facilities. At June 30, 2004, the Company's revolving credit
facilities totaled $2,020 million, consisting of a $1,500 million credit
facility that terminates in May 2009; a $500 million 364-day credit facility
that terminates in May 2005 and contains an option to convert into a one-year
term loan maturing in May 2006; and a $20 million uncommitted credit facility.
Use of the borrowings is unrestricted and the borrowings are unsecured.

The revolving credit facilities provide borrowing capacity and support the
Company's commercial paper. The Company had approximately $1,046 million and
$1,003 million of commercial paper outstanding at June 30, 2004 and December 31,
2003, respectively, at weighted average interest rates of 1.33 percent and 1.20
percent, respectively.

In addition, the Company increased its borrowing capacity under its revolving
credit and security facility, which is secured by the Company's domestic trade
receivables, from $200 million to $400 million. The Company had approximately
$382 million and $194 million of borrowings outstanding under its revolving
credit and security facility at June 30, 2004 and December 31, 2003,
respectively, at weighted average interest rates of 1.46 percent and 1.44
percent, respectively. The Company expects to renew the revolving credit and
security facility for an additional 364 days upon its maturity in August 2004.

The Company has the ability and intent to refinance a portion of its short-term
debt on a long-term basis through its revolving credit facilities. At June 30,
2004, the Company expects that a minimum of approximately $1,150 million of its
short-term obligations will remain outstanding beyond the next twelve months
and, accordingly, has classified this portion as long-term borrowings, as
compared to $650 million of short-term bank obligations classified as long-term
at December 31, 2003.

The Company had $500 million of senior notes outstanding at June 30, 2004 and
December 31, 2003 that are due March of 2005. These notes are registered
securities, bear a semi-annual coupon of 6.625 percent and are not redeemable
prior to maturity or subject to any sinking fund requirements. The Company has
classified these notes as a current liability at June 30, 2004.

In June 2004, due to favorable market conditions, the continued increase of
non-U.S. cash balances and to support the Company's strategic growth objectives,
the Company issued $600

                                       12
<PAGE>

million of senior notes due June 2014 under a Public Debt Registration Statement
previously filed with the U.S. Securities and Exchange Commission (SEC). These
notes bear a semi-annual coupon of 5.45 percent, are redeemable prior to
maturity and are not subject to any sinking fund requirements. The Company
entered a fixed-to-floating interest rate swap to hedge against changes in the
fair value of these notes. The Company recorded changes in the fair value of
these notes since the inception of the interest rate swap. Interest payments
made or received under the interest rate swap agreement are recorded as interest
expense. Interest is payable at the six-month LIBOR rate plus zero percent,
which was approximately 1.94 percent at June 30, 2004.

NOTE G - INVENTORIES

The components of inventory consist of the following:

                                                    June 30,      December 31,
(in millions)                                         2004            2003
-------------------------------------------------   --------        --------

Finished goods                                      $    175        $    175
Work-in-process                                           45              63
Raw materials                                             59              43
                                                    --------        --------

Total                                               $    279        $    281
                                                    ========        ========

In the second quarter of 2004, the Company recorded inventory write-downs of $43
million (pre-tax) in conjunction with the recall of certain units of the
Company's Taxus(TM) Express(2)(TM) paclitaxel-eluting coronary stent systems and
Express(2)(TM) coronary stent systems.

NOTE H - NEW ACCOUNTING STANDARDS

During the first quarter of 2004, the Company adopted FASB Interpretation No.
46, CONSOLIDATION OF VARIABLE INTEREST ENTITIES. Interpretation No. 46 clarifies
the conditions under which the assets, liabilities and activities of another
entity should be consolidated into the financial statements of a company.
Interpretation No. 46 requires the consolidation of a variable interest entity
by a company that bears the majority of the risk of loss from the variable
interest entity's activities or is entitled to receive the majority of the
variable interest entity's residual returns. The Company's adoption of
Interpretation No. 46 had no material impact on the Company's consolidated
financial statements.

NOTE I - COMMITMENTS AND CONTINGENCIES

The Company is involved in various legal proceedings, including patent
infringement and product liability suits, from time to time in the normal course
of business. In management's opinion, the Company is not currently involved in
any legal proceeding other than those specifically identified in this Quarterly
Report, the Quarterly Report on Form 10-Q for the quarter ended March 31, 2004
and the Company's Annual Report on Form 10-K for the year ended December 31,
2003, which, individually or in the aggregate, could have a material effect on
the financial condition, operations and/or cash flows of the Company.

                                       13
<PAGE>

LITIGATION WITH JOHNSON & JOHNSON
On October 22, 1997, Cordis Corporation (Cordis), a subsidiary of Johnson &
Johnson, filed a suit for patent infringement against the Company and SCIMED
Life Systems, Inc. (SCIMED), a subsidiary of the Company, alleging that the
importation and use of the NIR(R) stent infringes two patents owned by Cordis.
On April 13, 1998, Cordis filed a suit for patent infringement against the
Company and SCIMED alleging that the Company's NIR(R) stent infringes two
additional patents owned by Cordis. The suits were filed in the U.S. District
Court for the District of Delaware seeking monetary damages, injunctive relief
and that the patents be adjudged valid, enforceable and infringed. A trial on
both actions was held in late 2000. A jury found that the NIR(R) stent does not
infringe three Cordis patents, but does infringe one claim of one Cordis patent
and awarded damages of approximately $324 million to Cordis. On March 28, 2002,
the Court set aside the damage award, but upheld the remainder of the verdict,
and held that two of the four patents had been obtained through inequitable
conduct in the U.S. Patent and Trademark Office. On May 16, 2002, the Court also
set aside the verdict of infringement, requiring a new trial. The case had been
stayed until October 10, 2003, pending the outcome of a related case. On October
14, 2003, Cordis filed a motion to revise and vacate the Court's decision to
grant the Company a new trial and asked the Court to enter judgment against the
Company. The Company filed an opposition to Cordis' motion and, on February 14,
2004, the motion was denied. A status conference is scheduled for August 30,
2004.

On March 13, 1997, the Company (through its subsidiaries) filed suits against
Johnson & Johnson (through its subsidiaries) in The Netherlands and Belgium, and
on March 17, 1997, filed suit in France, seeking a declaration of
noninfringement for the NIR(R) stent relative to two European patents licensed
to Ethicon, Inc. (Ethicon), a Johnson & Johnson subsidiary, as well as a
declaration of invalidity with respect to those patents. On October 28, 1998,
the Company's motion for a declaration of noninfringement in France was
dismissed for failure to satisfy statutory requirements; the French invalidity
suits were not affected. On January 16, 2002, the French Court found one of the
patents to be valid and the other to be invalid and the parties appealed the
Court's decision. On June 9, 2004, the French Court of Appeals confirmed the
lower court's ruling. On March 21, 1997, the Company (through its subsidiaries)
filed a suit against Johnson & Johnson (through its subsidiaries) in Italy
seeking a declaration of noninfringement for the NIR(R) stent relative to one of
the European patents licensed to Ethicon and a declaration of invalidity. A
technical expert was appointed by the Court and a hearing was held on January
30, 2002. Both parties have had an opportunity to comment on the expert report.
On May 8, 2002, the Court closed the evidentiary phase of the case and a hearing
was held on April 29, 2004. A decision has not yet been received.

Ethicon and other Johnson & Johnson subsidiaries filed a cross-border suit in
The Netherlands on March 17, 1997, alleging that the NIR(R) stent infringes one
of the European patents licensed to Ethicon. In this action, the Johnson &
Johnson entities requested relief, including provisional relief (a preliminary
injunction), covering Austria, Belgium, France, Greece, Italy, The Netherlands,
Norway, Spain, Sweden and Switzerland. On April 2, 1997, the Johnson & Johnson
entities filed a similar cross-border proceeding in The Netherlands with respect
to a second European patent licensed to Ethicon. In October 1997, Johnson &
Johnson's request for provisional cross-border relief on both patents was denied
by the Dutch Court, on the ground that it is "very likely" that the NIR(R) stent
will be found not to infringe the patents. Johnson &

                                       14
<PAGE>

Johnson appealed this decision with respect to the second patent; the appeal has
been denied on the grounds that there is a "ready chance" that the patent will
be declared null and void. In January 1999, Johnson & Johnson amended the claims
of the second patent, changed the action from a cross-border case to a Dutch
national action, and indicated its intent not to pursue its action on the first
patent. On June 23, 1999, the Dutch Court affirmed that there were no remaining
infringement claims with respect to either patent. In late 1999, Johnson &
Johnson appealed this decision. On March 11, 2004, the Court of Appeals
nullified the Dutch Court's June 23, 1999 decision and the proceedings have been
returned to the lower court. A hearing has not yet been scheduled.

On February 14, 2002, the Company and certain of its subsidiaries filed suit for
patent infringement against Johnson & Johnson and Cordis alleging that certain
balloon catheters, stent delivery systems, and guide catheters sold by Johnson &
Johnson and Cordis infringe five U.S. patents owned by the Company. The
complaint was filed in the U.S. District Court for the Northern District of
California seeking monetary and injunctive relief. On October 15, 2002, Cordis
filed a counterclaim alleging certain balloon catheters and stent delivery
systems sold by the Company infringe three U.S. patents owned by Cordis and
seeking monetary and injunctive relief. On December 6, 2002, the Company filed
an amended complaint alleging that two additional patents owned by the Company
are infringed by the Cordis products. A summary judgment hearing was held on
April 9, 2004, and Cordis' motions for summary judgment were denied. A Markman
hearing was held on April 27, 2004, and a trial is expected to begin in January
2005.

On March 26, 2002, the Company and Target Therapeutics, Inc. (Target), a wholly
owned subsidiary of the Company, filed suit for patent infringement against
Cordis alleging that certain detachable coil delivery systems and/or pushable
coil vascular occlusion systems (coil delivery systems) infringe three U.S.
patents, owned by or exclusively licensed to Target. The complaint was filed in
the U.S. District Court for the Northern District of California seeking monetary
and injunctive relief. A summary judgment hearing was held on April 19, 2004,
and on June 25, 2004, the Court granted summary judgment relating to
infringement of one of the patents. Trial is expected to begin in October 2004.

On January 13, 2003, Cordis filed suit for patent infringement against the
Company and SCIMED alleging the Company's Express(2)(TM) coronary stent
infringes a U.S. patent owned by Cordis. The suit was filed in the U.S. District
Court for the District of Delaware seeking monetary and injunctive relief. On
February 14, 2003, Cordis filed a motion requesting a preliminary injunction.
The Company answered the complaint, denying the allegations, and filed a
counterclaim against Cordis, alleging that certain products sold by Cordis
infringe a patent owned by the Company. A hearing on the preliminary injunction
motion was held and on November 21, 2003, the Court denied the motion for a
preliminary injunction. Cordis appealed the denial of its motion and a hearing
was held on April 5, 2004. On May 28, 2004, the Court of Appeals affirmed the
denial of the preliminary injunction. On August 4, 2004, the Court granted a
Cordis motion to add the Company's Liberte coronary stent and two additional
patents to the complaint. The trial is currently scheduled to begin June 13,
2005.

                                       15
<PAGE>

On March 13, 2003, the Company and Boston Scientific Scimed, Inc. filed suit for
patent infringement against Johnson & Johnson and Cordis, alleging that its
Cypher(TM) drug-eluting stent infringes a patent owned by the Company. The suit
was filed in the District Court of Delaware seeking monetary and injunctive
relief. On March 20, 2003, the Company filed a motion seeking a preliminary
injunction with respect to the sale of the Cypher drug-eluting stent in the
United States. Cordis answered the complaint, denying the allegations, and filed
a counterclaim against the Company alleging that the patent is not valid and is
unenforceable. The Company filed amended complaints alleging that the Cypher
drug-eluting stent infringes four additional patents owned by the Company. A
hearing on the preliminary injunction motion was held and, on November 21, 2003,
the Court denied the motion for a preliminary injunction. Following the
announcement on February 23, 2004 by Guidant Corporation (Guidant) of an
agreement with Johnson & Johnson and Cordis to sell the Cypher drug-eluting
stent, the Company moved to amend its complaint on February 25, 2004 to include
Guidant and certain of its subsidiaries as co-defendants. The trial on the first
patent is scheduled to begin on June 13, 2005. The trial on the remaining four
patents is scheduled for October 2005.

On December 24, 2003, the Company (through its subsidiary Schneider Europe GmbH)
filed suit against the Belgian subsidiaries of Johnson & Johnson, Cordis and
Janssen Pharmaceutica alleging that Cordis' Bx Velocity(R) stent, Bx Sonic(R)
stent, Cypher stent, Cypher Select stent, Aqua T3(TM) balloon and U-Pass balloon
infringe one of the Company's European patents. The suit was filed in the
District Court of Brussels, Belgium seeking preliminary cross-border, injunctive
and monetary relief and sought an expedited review of the claims by the Court. A
separate suit was filed in the District Court of Brussels, Belgium against nine
additional Johnson & Johnson subsidiaries. On February 9, 2004, the Belgium
Court linked all Johnson & Johnson entities into a single action. A hearing was
held on June 7, 2004, and on June 21, 2004, the Court dismissed the case for
failure to satisfy the requirements for expedited review without commenting on
the merits of the claims. On August 5, 2004, the Company re-filed the suit on
the merits against the same Johnson & Johnson subsidiaries in the District Court
of Brussels, Belgium seeking cross-border, injunctive and monetary relief for
infringement of the same European patent.

On May 12, 2004, the Company (through its subsidiary Schneider Europe GmbH)
filed suit against two of Johnson & Johnson's Dutch subsidiaries, alleging that
Cordis' Bx Velocity(R) stent, Bx Sonic(R) stent, Cypher stent, Cypher Select
stent, Aqua T3(TM) balloon and U-Pass balloon infringe one of the Company's
European patents. The suit was filed in the District Court of the Hague in The
Netherlands seeking cross-border, injunctive and monetary relief.

On December 15, 2003, the Company and SCIMED filed suit for patent infringement
against Cordis and Johnson & Johnson alleging Cordis' Cypher drug-eluting stent
coating infringes two U.S. patents owned by the Company. The suit was filed in
the District Court of Delaware seeking monetary and injunctive relief. Following
the announcement on February 23, 2004 by Guidant of an agreement with Johnson &
Johnson and Cordis to sell the Cypher drug-eluting stent, the Company amended
its complaint on February 25, 2004 to include Guidant and certain of its
subsidiaries as co-defendants. A trial is scheduled to begin in October 2005.

                                       16
<PAGE>

LITIGATION RELATING TO COOK, INC.
On September 10, 2001, the Company delivered a Notice of Dispute to Cook, Inc.
(Cook) asserting that Cook breached the terms of a certain License Agreement
among Angiotech Pharmaceuticals, Inc. (Angiotech), Cook and the Company (the
Agreement) relating to an improper arrangement between Cook and Guidant. On
December 13, 2001, Cook filed suit in the U.S. District Court for the Northern
District of Illinois seeking declaratory and injunctive relief. The Company
answered the complaint on December 26, 2001, denying the allegations and filed
counterclaims seeking declaratory and injunctive relief. On June 27, 2002, the
Court found in favor of the Company, ruling that Cook breached the Agreement. On
October 1, 2002, the Court granted the Company's request for a permanent
injunction prohibiting certain activities under the Agreement and enjoining the
use of the clinical data and technologies developed by Cook or Guidant in
violation of the Agreement. Cook appealed the decision to the U.S. Court of
Appeals for the Seventh Circuit. On June 19, 2003, the Court of Appeals affirmed
the District Court's decision. The Court of Appeals modified the District
Court's injunction by deleting language that would have prohibited the use of
clinical data to obtain regulatory approval, but continued to enjoin the sale of
products. On February 19, 2004, Cook filed a motion to dissolve the Court's
injunction, or in the alternative to modify the injunction to permit Cook to use
clinical data previously obtained to pursue regulatory approval to market a
paclitaxel-eluting stent. A hearing was held on March 1, 2004, followed by the
Court's request that both parties brief the issue. On April 15, 2004, the Court
denied Cook's motion to dissolve the injunction.

OTHER PATENT LITIGATION
On July 28, 2000, Dr. Tassilo Bonzel filed a complaint naming certain of the
Company's Schneider Worldwide subsidiaries and Pfizer Inc. (Pfizer) and certain
of its affiliates as defendants, alleging that Pfizer failed to pay Dr. Bonzel
amounts owed under a license agreement involving Dr. Bonzel's patented
Monorail(TM) technology. The suit was filed in the District Court for the State
of Minnesota seeking monetary relief. On September 26, 2001, Dr. Bonzel and the
Company reached a contingent settlement involving all but one claim asserted in
the complaint. The contingency has been satisfied and the settlement is now
final. On December 17, 2001, the remaining claim was dismissed without prejudice
with leave to refile the suit in Germany. Dr. Bonzel filed an appeal of the
dismissal of the remaining claim. On July 29, 2003, the Appellate Court affirmed
the lower court's dismissal, and on October 24, 2003, the Minnesota Supreme
Court denied Dr. Bonzel's petition for further review. On March 26, 2004, Dr.
Bonzel filed a similar complaint against the Company, certain of its
subsidiaries and Pfizer in the Federal District Court for the District of
Minnesota. The Company and its subsidiaries answered, denying the allegations of
the complaint. The Company filed a motion to dismiss the case and a hearing on
the motion is scheduled for August 27, 2004.

On December 16, 2003, The Regents of the University of California (The Regents)
filed suit against Micro Therapeutics, Inc. (Micro Therapeutics) and Dendron
GmbH (Dendron) alleging that Micro Therapeutics' Sapphire (TM) detachable coil
delivery systems infringe twelve patents licensed by the Company and owned by
The Regents. The complaint was filed in the U.S. District Court for the Northern
District of California seeking monetary and injunctive relief. On January 8,
2004, Micro Therapeutics and Dendron filed a third party complaint to include
the Company and Target as third party defendants seeking a declaratory judgment
of invalidity and

                                       17
<PAGE>

non-infringement with respect to the patents and antitrust violations. On
February 17, 2004, the Company, as a third party defendant, filed a motion to
dismiss the Company from the case. On July 9, 2004, the Court granted the
Company's motion in part and dismissed the Company and Target from the claims
relating only to patent infringement, while denying dismissal of an antitrust
claim.

LITIGATION RELATING TO ADVANCED NEUROMODULATION SYSTEMS, INC.
On April 21, 2004, Advanced Neuromodulation Systems, Inc. (ANSI) filed suit
against Advanced Bionics, a subsidiary of the Company, alleging that its
Precision(TM) spinal cord stimulation system infringes a U.S. patent owned by
ANSI. The suit also includes allegations of misappropriation of trade secrets
and tortious interference with a contract. The suit was filed in the U.S.
District Court for the Eastern District of Texas and seeks monetary and
injunctive relief. The Company has answered, denying the allegations of the
complaint. On June 1, 2004, the Company acquired Advanced Bionics and assumed
the defense of the litigation. On June 25, 2004, the Company filed a motion to
dismiss and request for transfer of venue to California.

LITIGATION WITH MEDINOL LTD.
On April 22, 2002, Medinol filed suit against Boston Scientific Medizintechnik
GmbH (GmbH), a German subsidiary of the Company, alleging that the Company's
Express stent infringes certain German patents and utility models owned by
Medinol. The suit was filed in Dusseldorf, Germany. Hearings were held in May
2003, and on June 24, 2003, the German court found that the Express(R) stent
infringes one German patent and one utility model asserted by Medinol and
enjoined sales in Germany. The Company has appealed and a hearing on the appeal
is scheduled to begin in January 2005. On March 31, 2004, the European Patent
Office declared the patent invalid. A hearing on the validity of the utility
model is also scheduled for January 2005. A hearing on damages is scheduled for
February 22, 2005.

On July 2, 2003, Medinol filed a motion against the Company seeking a
preliminary injunction with respect to the sale of the Express stent in Germany.
The German Court granted Medinol's motion effective September 23, 2003. The
Company appealed the German Court's decision. On March 31, 2004, the European
Patent Office declared the patent invalid. The decision is final and not
appealable. Medinol has withdrawn its motion seeking a preliminary injunction.

On April 30, 2004, Medinol filed suit against the Company alleging that the
Company's Express and TAXUS stent systems infringe a utility model owned by
Medinol. The suit was filed in Dusseldorf, Germany. A hearing is scheduled for
April 21, 2005.

On January 21, 2003, Medinol filed suit against several of the Company's
international subsidiaries in the District Court of The Hague, Netherlands
seeking cross-border, monetary and injunctive relief covering The Netherlands,
Austria, Belgium, United Kingdom, Ireland, Switzerland, Sweden, Spain, France,
Portugal and Italy, alleging the Company's Express stent infringes four European
patents owned by Medinol. A hearing was held on October 10, 2003, and a decision
was rendered on December 17, 2003 finding the Company infringes one patent. The
Court, however, granted no cross-border relief. The Company appealed the finding
and filed nullity actions against one of the patents in Ireland, France, Italy,
Spain, Sweden, Portugal, and

                                       18
<PAGE>

Switzerland. On March 31, 2004, the European Patent Office declared this patent
invalid. The Court's injunction and damages order have been dismissed. Medinol
appealed the Court's decision with respect to the remaining three patents
seeking an expedited review of the claims by the Court. On May 6, 2004, Medinol
filed a kort geding proceeding against the Company's same international
subsidiaries alleging that the sale of the Express and TAXUS coronary stent
systems infringe one of the patents on appeal from the 2003 suit. The suit was
filed in the District Court of the Hague, The Netherlands seeking preliminary
injunctive relief. On August 5, 2004, the Court denied Medinol's request for
preliminary injunctive relief.

On September 10, 2002, the Company filed suit against Medinol alleging Medinol's
NIRFlex(TM) and NIRFlex(TM) Royal products infringe two patents owned by the
Company. The suit was filed in Dusseldorf, Germany seeking monetary and
injunctive relief. A hearing was held on September 23, 2003. On October 28,
2003, the German Court found that Medinol infringed one of the two patents owned
by the Company. On December 8, 2003, the Company filed an appeal relative to the
other patent. Subsequently, Medinol filed an appeal relative to the one patent
found to be infringed. A hearing on both appeals is scheduled for April 14,
2005.

DEPARTMENT OF JUSTICE INVESTIGATION
In October 1998, the Company recalled its NIR ON(R) Ranger(TM) with Sox(TM)
coronary stent delivery system following reports of balloon leaks. Since
November 1998, the U.S. Department of Justice has been conducting an
investigation primarily regarding: the shipment, sale and subsequent recall of
the NIR ON(R) Ranger(TM) with Sox(TM) stent delivery system; aspects of the
Company's relationship with Medinol, the vendor of the stent; and related
events. The Company and two senior officials have been advised that they are
targets of the federal grand jury investigation, but that no final decision has
been made as to whether any potential charges would be brought. Although the
Company has contested certain procedural matters related to the conduct of the
investigation, the Company and the two senior officials have agreed to extend
the applicable statute of limitations, which may result in the investigation
continuing into the fall of 2004 or beyond. There can be no assurance that the
investigation will result in an outcome favorable to the Company, that charges
would not be brought, or that the Company would not agree to a further extension
of the statute. The Company believes that it will ultimately be demonstrated
that the Company and its officials acted responsibly and appropriately.

NOTE J - SEGMENT REPORTING

The Company has four reportable operating segments based on geographic regions:
the United States, Europe, Japan and Inter-Continental. Each of the Company's
reportable segments generates revenue from the sale of minimally invasive
medical devices. The reportable segments represent an aggregate of operating
divisions. Sales and operating results of reportable segments are based on
internally derived standard foreign exchange rates, which may differ from year
to year and do not include inter-segment profits. The segment information
presented for 2003 sales and operating results has been restated based on the
Company's standard foreign exchange rates used for 2004. Because of the
interdependence of the reportable segments, the operating profit as presented
may not be representative of the geographic distribution that would occur if the
segments were not interdependent.

                                       19
<PAGE>

<TABLE><CAPTION>
                                                            United                                 Inter-
(in millions)                                               States       Europe       Japan     Continental     Total
------------------------------------------------------     --------     --------     --------     --------     --------
<S>                                                        <C>          <C>          <C>          <C>          <C>
Three months ended June 30, 2004
     Net sales                                             $    944     $    218     $    156     $    121     $  1,439
     Operating income allocated to reportable segments          519          104           91           55          769

Three months ended June 30, 2003
     Net sales                                             $    482     $    164     $    144     $     74     $    864
     Operating income allocated to reportable segments          183           75           82           28          368

Six months ended June 30, 2004
     Net sales                                             $  1,520     $    428     $    305     $    230     $  2,483
     Operating income allocated to reportable segments          730          210          182          106        1,228

Six months ended June 30, 2003
     Net sales                                             $    961     $    314     $    280     $    136     $  1,691
     Operating income allocated to reportable segments          370          141          160           49          720
</TABLE>

A reconciliation of the totals reported for the reportable segments to the
applicable line items in the consolidated financial statements is as follows:

<TABLE><CAPTION>
                                                                   Three Months Ended           Six Months Ended
                                                                        June 30,                    June 30,
(in millions)                                                      2004          2003          2004          2003
------------------------------------------------------------     --------      --------      --------      --------
<S>                                                              <C>           <C>           <C>           <C>
Net sales:
     Total net sales for reportable segments                     $  1,439      $    864      $  2,483      $  1,691
     Foreign exchange                                                  21           (10)           59           (30)
                                                                 --------      --------      --------      --------
                                                                 $  1,460      $    854      $  2,542      $  1,661
                                                                 ========      ========      ========      ========
Income before income taxes:
     Total operating income allocated to reportable segments     $    769      $    368      $  1,228      $    720
     Manufacturing operations                                         (82)          (72)         (164)         (143)
     Corporate expenses and foreign exchange                         (175)         (111)         (288)         (217)
     Litigation-related charges                                                                                  (7)
     Purchased research and development                               (64)          (12)          (64)          (25)
                                                                 --------      --------      --------      --------
                                                                      448           173           712           328
     Other income (expense), net                                      (16)          (12)          (25)          (27)
                                                                 --------      --------      --------      --------
                                                                 $    432      $    161      $    687      $    301
                                                                 ========      ========      ========      ========
</TABLE>
                                       20
<PAGE>
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

OVERVIEW

Boston Scientific Corporation (Boston Scientific or the Company) is a worldwide
developer, manufacturer and marketer of medical devices that are used in a broad
range of interventional medical specialties. The Company's mission is to improve
the quality of patient care and the productivity of health care delivery through
the development and advocacy of less-invasive medical devices and procedures.
This is accomplished through the continuing refinement of existing products and
procedures and the investigation and development of new technologies that can
reduce risk, trauma, cost, procedure time and the need for aftercare. The
Company's approach to innovation combines internally developed products and
technologies with those obtained externally through strategic acquisitions and
alliances.

The Company's products are used in a broad range of interventional medical
specialties, including interventional cardiology, peripheral interventions,
vascular surgery, neurovascular intervention, electrophysiology, endoscopy,
oncology, urology and gynecology.


RESULTS OF OPERATIONS

FINANCIAL SUMMARY

THREE MONTHS ENDED JUNE 30, 2004

Net sales for the three months ended June 30, 2004 were $1,460 million as
compared to $854 million for the three months ended June 30, 2003, an increase
of 71 percent. Excluding the favorable impact of $31 million of foreign currency
fluctuations, net sales increased 67 percent. The reported net income for the
three months ended June 30, 2004 was $313 million, or $0.36 per share (diluted),
as compared to $114 million, or $0.13 per share, for the three months ended June
30, 2003. The reported results for the three months ended June 30, 2004 included
after-tax charges of $64 million, or $0.07 per share, consisting of purchased
research and development costs attributable to the recent acquisitions of
Advanced Bionics Corporation (Advanced Bionics) and Precision Vascular Systems,
Inc. (PVS). The reported results for the three months ended June 30, 2003
included after-tax charges of $12 million, or $0.01 per share, consisting of
purchased research and development costs attributable to acquisitions that
closed in the first quarter of 2003.

                                       21
<PAGE>

SIX MONTHS ENDED JUNE 30, 2004

Net sales for the six months ended June 30, 2004 were $2,542 million as compared
to $1,661 million for the six months ended June 30, 2003, an increase of 53
percent. Excluding the favorable impact of $89 million due to foreign currency
fluctuations, net sales increased approximately 48 percent. The reported net
income for the six months ended June 30, 2004 was $507 million, or $0.59 per
share (diluted), as compared to $211 million, or $0.25 per share, for the six
months ended June 30, 2003. The reported results for the six months ended June
30, 2004 included after-tax charges of $64 million, or $0.07 per share,
consisting of purchased research and development costs attributable to the
Company's recent acquisitions. The reported results for the six months ended
June 30, 2003 included after-tax charges of $32 million, or $0.04 per share,
consisting of purchased research and development costs of $25 million
attributable to acquisitions that closed in the first quarter of 2003 and a $7
million charge related to litigation.

The results for the three and six months ended June 30, 2004 included the net
impact of the recall of certain units of the Company's Taxus(TM) Express(2)(TM)
paclitaxel-eluting coronary stent systems and Express(2)(TM) coronary stent
systems, in the amount of $57 million (after-tax). The recall impact consists of
the establishment of a sales returns reserve of $35 million and an inventory
write-down of $43 million.

NET SALES
The following tables provide worldwide net sales by region and relative change
on an as reported and constant foreign currency basis for the three and six
months ended June 30, 2004 and 2003, respectively:

                                       22
<PAGE>

<TABLE><CAPTION>
                               Three Months                       Change
                              Ended June 30,           As Reported       Constant
(in millions)              2004            2003       Currency Basis   Currency Basis
                         --------        --------        --------         --------
<S>                      <C>             <C>                   <C>              <C>
UNITED STATES            $    944        $    482              96%              96%

EUROPE                        236             165              43%              34%
JAPAN                         157             134              17%               8%
INTER-CONTINENTAL             123              73              68%              63%
                         --------        --------        --------         --------
INTERNATIONAL                 516             372              39%              30%

                         --------        --------        --------         --------
WORLDWIDE                $  1,460        $    854              71%              67%
                         ========        ========        ========         ========

                                Six Months                        Change
                              Ended June 30,           As Reported       Constant
                           2004            2003       Currency Basis   Currency Basis
                         --------        --------        --------         --------

UNITED STATES            $  1,520        $    961              58%              58%

EUROPE                        471             310              52%              37%
JAPAN                         312             260              20%              10%
INTER-CONTINENTAL             239             130              84%              70%
                         --------        --------        --------         --------
INTERNATIONAL               1,022             700              46%              33%

                         --------        --------        --------         --------
WORLDWIDE                $  2,542        $  1,661              53%              48%
                         ========        ========        ========         ========
</TABLE>

United States (U.S.) revenues increased primarily due to $468 million and $566
million in sales of the TAXUS stent system during the three and six months ended
June 30, 2004, respectively. The Company commenced its tiered U.S. launch of the
TAXUS stent system late in the first quarter of 2004. The increase was offset by
declines in bare metal stent revenue of approximately $49 million and $96
million during the three and six months ended June 30, 2004, respectively, as
physicians continued to convert interventional procedures from bare metal to
drug-eluting stent technology, including the TAXUS stent system. The Company
estimates that, as of June 30, 2004, physicians have converted more than 80
percent of the stents used in interventional procedures in the U.S. from bare
metal stent systems to drug-eluting stent systems, as compared to approximately
50 percent at December 31, 2003. The remainder of the increase in U.S. revenues
was related to sales growth in each of the Company's other five U.S. divisions.

International revenues increased primarily due to $129 million and $247 million
in sales for the three and six months ended June 30, 2004, respectively, of the
TAXUS stent system in the Company's Europe and Inter-Continental markets as
compared to $32 million and $39 million, respectively, in the same periods in
the prior year. The TAXUS stent system was launched in these markets late in the
first quarter of 2003. The increase in international revenues was also
attributable to revenue growth of approximately $23 million and $52 million in
Japan during the three and six months ended June 30, 2004,

                                       23
<PAGE>

respectively, following the launch of the Express(2) coronary stent system in
the first quarter of 2004.

Worldwide coronary stent sales increased approximately 430 percent and 293
percent, respectively, to $652 million and $936 million for the three and six
months ended June 30, 2004, respectively, as compared to the same periods in the
prior year. The increase was primarily due to $597 million and $813 million in
sales of the TAXUS stent system for the three and six months ended June 30,
2004, respectively, as compared to $32 million and $39 million in the same
periods in the prior year. The increase was offset by declines in bare metal
stent revenue of $36 million and $76 million for the three and six months ended
June 30, 2004, respectively, as physicians continued to convert interventional
procedures from bare metal to drug-eluting stent technology, including the TAXUS
stent system.

The following tables provide worldwide net sales by division and relative change
on an as reported and constant foreign currency basis for the three and six
months ended June 30, 2004 and 2003, respectively:






















                                       24
<PAGE>

<TABLE><CAPTION>
                               Three Months                       Change
                              Ended June 30,           As Reported       Constant
(in millions)              2004            2003       Currency Basis   Currency Basis
                         --------        --------        --------         --------
<S>                      <C>             <C>                   <C>              <C>
Cardiovascular           $  1,092        $    532             105%             100%
Electrophysiology              31              28              11%              12%
Neurovascular                  62              55              13%               8%
                         --------        --------        --------         --------
CARDIOVASCULAR              1,185             615              93%              88%

Oncology                       45              41              10%               8%
Endoscopy                     159             144              10%               7%
Urology                        64              54              19%              14%
                         --------        --------        --------         --------
ENDOSURGERY                   268             239              12%               9%

Neuromodulation                 7                             N/A              N/A

                         --------        --------        --------         --------
WORLDWIDE                $  1,460        $    854              71%              67%
                         ========        ========        ========         ========

                                Six Months                        Change
                              Ended June 30,           As Reported       Constant
                           2004            2003       Currency Basis   Currency Basis
                         --------        --------        --------         --------

Cardiovascular           $  1,815        $  1,034              76%              69%
Electrophysiology              63              55              15%              11%
Neurovascular                 126             106              19%              13%
                         --------        --------        --------         --------
CARDIOVASCULAR              2,004           1,195              68%              61%

Oncology                       91              79              15%              11%
Endoscopy                     317             282              12%               8%
Urology                       123             105              17%              13%
                         --------        --------        --------         --------
ENDOSURGERY                   531             466              14%              10%

Neuromodulation                 7                             N/A              N/A

                         --------        --------        --------         --------
WORLDWIDE                $  2,542        $  1,661              53%              48%
                         ========        ========        ========         ========
</TABLE>

The Company's international operating regions and divisions are managed on a
constant currency basis, while market risk from changes in currency exchange
rates is managed at the corporate level and is reflected in operating results.

                                       25
<PAGE>

GROSS PROFIT

<TABLE><CAPTION>
                                   Three Months Ended                                        Six Months Ended
                                         June 30,                                                June 30,
                            2004                       2003                      2004                          2003
                  -------------------------- -------------------------   ---------------------------   ------------------------
(in millions)       $         % of Net Sales   $        % of Net Sales     $          % of Net Sales     $       % of Net Sales
----------------- -----       -------------- -----      --------------   -----        --------------   -----     --------------
<S>               <C>              <C>         <C>            <C>        <C>               <C>         <C>           <C>
Gross Profit      1,097            75.1        619            72.5       1,887             74.2        1,200         72.2
</TABLE>

The increase in gross profit during the three months ended June 30, 2004 was
primarily due to an approximately 700 basis point increase as a result of shifts
in the Company's product sales mix toward higher margin products, primarily
drug-eluting coronary stents. The increase in the Company's gross profit
percentage was offset by approximately 300 basis points related to the $43
million (pre-tax) write-down of inventory in conjunction with the recall of
coronary stent systems. In addition, gross profit as a percentage of net sales
was reduced by approximately 50 basis points attributable to other expenses
primarily associated with the increase in the number of units manufactured; and
by approximately 40 basis points due to currency translation hedging that was
offset by foreign currency fluctuations.

The increase in gross profit during the six months ended June 30, 2004 was
primarily due to an approximately 560 basis point increase as a result of shifts
in the Company's product sales mix toward higher margin products, primarily
drug-eluting coronary stents. The increase in the Company's gross profit
percentage was offset by approximately 220 basis points related to $57 million
(pre-tax) in inventory write-downs, primarily attributable to the recall of
coronary stent systems of $43 million (pre-tax) recorded in the second quarter
of 2004 and the write-down of TAXUS inventory of $14 million (pre-tax) recorded
in the first quarter of 2004 due to shelf-life dating. In addition, gross profit
as a percentage of net sales was reduced by approximately 70 basis points
attributable to other expenses primarily associated with the increase in the
number of units manufactured; and by approximately 40 basis points due to
currency translation hedging that was offset by foreign currency fluctuations.

OPERATING EXPENSES
The following is a summary of certain operating expenses for the three months
and the six months ended June 30, 2004 and 2003:

<TABLE><CAPTION>
                                                       Three Months Ended                   Six Months Ended
                                                            June 30,                            June 30,
                                                     2004              2003              2004              2003
                                                 -------------     -------------     -------------     -------------
                                                        % of Net          % of Net          % of Net          % of Net
(in millions)                                     $      Sales      $      Sales      $       Sales     $       Sales
--------------------------------------------     ----     ----     ----     ----     ----     ----     ----     ----
<S>                                               <C>     <C>       <C>     <C>       <C>     <C>       <C>     <C>
Selling, general and administrative expenses      375     25.7      292     34.2      723     28.4      563     33.9
Amortization expense                               26      1.8       21      2.5       48      1.9       41      2.5
Royalties                                          52      3.6       13      1.5       74      2.9       25      1.5
Research and development expenses                 132      9.0      108     12.6      266     10.5      211     12.7
</TABLE>
                                       26
<PAGE>

SELLING, GENERAL AND ADMINISTRATIVE (SG&A) EXPENSES
For the three and six months ended June 30, 2004, the increase in SG&A expenses
was primarily related to approximately $45 million and $80 million,
respectively, in additional marketing programs, increased headcount and higher
employee compensation, primarily attributable to the TAXUS stent program, and,
to a lesser degree, to support the Company's other product franchises; and
approximately $10 million and $20 million, respectively, in increased expense
due to foreign currency fluctuations. The Company also experienced increases in
general and administrative expenses of approximately $20 million and $40 million
in the three and six months ended June 30, 2004, respectively, as compared to
the same periods in the prior year. The decrease in SG&A expenses as a
percentage of net sales was primarily attributable to the Company's efforts to
grow SG&A spending at a slower rate than revenue.

AMORTIZATION EXPENSE
The increase in amortization expense in the three and six months ended June 30,
2004 was primarily attributable to the amortization of intangible assets from
the acquisitions of Advanced Bionics and PVS. Amortization relating to these two
acquisitions for the remainder of 2004 will be approximately $15 million.

ROYALTIES
The increase in royalties for the three and six months ended June 30, 2004 was
due to increased sales of royalty-bearing products. Royalties attributable to
sales of the Company's TAXUS stent system increased by approximately $40 million
and $50 million for the three and six months ended June 30, 2004, respectively,
as compared to the same periods in the prior year.

RESEARCH AND DEVELOPMENT EXPENSES
The increase in research and development expenses reflects spending on new
product development programs as well as regulatory compliance and clinical
research. During the three and six months ended June 30, 2004, the Company
continued to invest heavily in its research and development efforts. The growth
in dollar spending reflects investment across multiple programs and divisions.

INTEREST EXPENSE AND OTHER, NET
Interest expense was $14 million and $12 million for the three months ended June
30, 2004 and 2003, respectively, and $25 million and $23 million for the six
months ended June 30, 2004 and 2003, respectively. The increase in interest
expense for the three and six months ended June 30, 2004 was primarily due to
the increase in average debt levels, which were partially offset by a decrease
in average interest rates.

Other, net, was expense of $2 million and income of less than $1 million for the
three months ended June 30, 2004 and 2003, respectively, and was expense of less
than $1 million and expense of $4 million for the six months ended June 30, 2004
and 2003, respectively. Included in other, net for the three and six months
ended June 30, 2004 were realized gains of $17 million and $32 million,
respectively, related to sales of investments and write-downs of $9 million and
$25 million, respectively, related to other

                                       27
<PAGE>

than temporary declines in the book value of certain investments in privately
held entities. The Company does not believe that these write-downs of assets
will have a material impact on future operations. Other, net was also impacted
by foreign currency transaction gains and losses that were not individually
significant.

TAX RATE
The Company's reported tax rate was 28 percent and 29 percent for the three
months ended June 30, 2004 and 2003, respectively, and was 26 percent and 30
percent for the six months ended 2004 and 2003, respectively. The decrease in
the Company's reported tax rate was due primarily to more revenue being
generated from products manufactured in lower tax jurisdictions during the three
and six months ended June 30, 2004, as compared to the same periods in the prior
year. The decrease was partially offset by an increase in purchased research and
development charges to $64 million for both the three and six months ended June
30, 2004 as compared to $12 million and $25 million for the three and six months
ended June 30, 2003, respectively. These charges are not deductible for tax
purposes. Management currently estimates that the 2004 effective tax rate will
remain at approximately 24 percent, net of special charges. However, the
effective tax rate could be impacted positively or negatively by geographic
changes in the manufacturing of products sold by the Company or by business
acquisitions.

The Company had recognized net deferred tax liabilities aggregating $39 million
at June 30, 2004 and net deferred tax assets aggregating $94 million at December
31, 2003. The fluctuation in the Company's deferred tax accounts is primarily
due to the intangible assets obtained in connection with the acquisition of
Advanced Bionics and PVS. In light of the Company's historical financial
performance, the Company believes that its deferred tax assets will be
substantially recovered.

PURCHASED RESEARCH AND DEVELOPMENT
The Company's purchased research and development charges recorded during the six
months ended June 30, 2004 relate to the acquisitions of Advanced Bionics and
PVS.

On June 1, 2004, the Company completed its acquisition of 100 percent of the
fully diluted equity of Advanced Bionics for an initial payment of approximately
$740 million in cash, plus earn out payments that are contingent upon Advanced
Bionics products reaching future performance milestones. Advanced Bionics has
developed or is developing implantable microelectronic technologies for treating
numerous neurological disorders. Its neuromodulation technology includes a range
of neurostimulators (or implantable pulse generators), programmable drug pumps
and cochlear implants. The acquisition was intended to expand the Company's
technology portfolio into the implantable microelectronic device market. The
Advanced Bionics acquisition was structured to include earnout payments that are
primarily contingent on the achievement of future performance milestones, with
certain milestone payments also tied to profitability. The performance
milestones are segmented by Advanced Bionics' four principal technology
platforms (cochlear implants, implantable pulse generators, drug pumps and bion
microstimulators), each milestone with a 72-month earnout horizon from the date
of the anticipated product launch. Base earnout payments on these performance
milestones approximate two and a quarter times incremental sales for each annual
period. There are

                                       28
<PAGE>

also bonus earnout payments available based on the attainment of certain
aggregate sales performance targets and a certain gross margin level. The
milestones associated with the contingent consideration must be reached in
certain future periods ranging from 2004 through 2013.

On April 2, 2004, the Company completed its acquisition of the remaining
outstanding shares of PVS for an initial payment of approximately $75 million in
cash, plus earnout payments that are contingent upon PVS products reaching
future performance milestones. PVS develops and manufactures guidewires and
microcatheter technology for use in accessing the brain, the heart and other
areas of the anatomy. The acquisition of PVS was intended to provide the Company
with expanded vascular access technology and an expanded intellectual property
portfolio.

The Company's condensed consolidated financial statements include Advanced
Bionics' and PVS' operating results from the date of acquisition. See Note E for
pro forma information that presents a summary of consolidated results of
operations of the Company and Advanced Bionics as if the acquisition had
occurred at the beginning of each of 2003 and 2004. Pro forma information is not
presented for PVS, as PVS' results of operations prior to its date of
acquisition are not significant in relation to the Company's consolidated
results.

The amounts paid for each acquisition have been allocated to the assets acquired
and liabilities assumed based on their fair values at the date of acquisition.
The estimated excess of purchase price over the fair value of the net tangible
assets acquired was allocated to identifiable intangible assets based on
detailed valuations. The Company's purchased research and development charges
are based upon these valuations. The valuation of purchased research and
development represents the estimated fair value at the date of acquisition
related to in-process projects. As of the date of acquisition, the in-process
projects had not yet reached technological feasibility and had no alternative
future uses. The primary basis for determining the technological feasibility of
these projects is obtaining regulatory approval to market the products in an
applicable geographical region. Accordingly, the value attributable to these
projects, which had not yet obtained regulatory approval, was expensed in
conjunction with the acquisition. If the projects are not successful, or
completed in a timely manner, the Company may not realize the financial benefits
expected for these projects.

The income approach was used to establish the fair values of purchased research
and development. This approach establishes fair value by estimating the
after-tax cash flows attributable to the in-process project over its useful life
and then discounting these after-tax cash flows back to a present value. Revenue
estimates were based on estimates of relevant market sizes, expected market
growth rates, expected trends in technology and expected product introductions
by competitors. In arriving at the value of the in-process research and
development projects, the Company considered, among other factors, the
in-process project's stage of completion, the complexity of the work completed
as of the acquisition date, the costs already incurred, the projected costs to
complete, the contribution of core technologies and other acquired assets, the
expected introduction date and the estimated useful life of the technology. The
discount rate used to arrive at a

                                       29
<PAGE>

present value as of the date of acquisition was based on the time value of money
and medical technology investment risk factors. For the purchased research and
development programs acquired in connection with the Company's 2004
acquisitions, risk-adjusted discount rates ranging from 18 percent to 27 percent
were utilized to discount the projected cash flows. The Company believes that
the estimated purchased research and development amounts so determined represent
the fair value at the date of acquisition and do not exceed the amount a third
party would pay for the projects.

The most significant in-process projects acquired in connection with the
Company's 2004 acquisitions include Advanced Bionics' bion(TM) microstimulator
and drug delivery pump, which collectively represent approximately 77 percent of
the 2004 in-process projects value. The bion microstimulator is an implantable
neurostimulation device that may be used to treat a variety of neurological
conditions, including urge incontinence, epilepsy, sleep apnea, erectile
dysfunction and migraine headaches. The cost to complete the bion
microstimulator is estimated to be between $35 million and $45 million. The drug
delivery pump is an implanted programmable device used to treat chronic pain.
The cost to complete the drug delivery pump is estimated to be between $30
million and $40 million. As of the date of acquisition, the products were
expected to be commercially available on a worldwide basis within three to four
years.

The Company's research and development projects acquired in connection with its
previous business combinations are generally progressing in line with the
estimates set forth in the Company's 2003 Annual Report on Form 10-K. The
Company expects to continue to pursue these research and development efforts and
believes it has a reasonable chance of completing the projects.

OUTLOOK

During the second quarter of 2004, the Company increased its revenue by 71
percent, its reported net income by 175 percent and its operating cash flow by
117 percent relative to the second quarter of 2003, primarily due to sales of
its TAXUS stent system that was approved for sale in the U.S. on March 4, 2004.
The Company estimates that the 2004 worldwide coronary stent market will
approach $4.7 billion, and may grow to approximately $5 billion in 2005. The
Company believes it can maintain and expand its position within this market for
a variety of reasons, including its years of scientifically rigorous research
and development, the results of its TAXUS clinical program, the combined
strength of the components of its technology, its overall market leadership, and
its sizeable interventional cardiology sales force. In addition, in order to
capitalize on this opportunity, the Company has made significant investments in
its sales, clinical, marketing and manufacturing capabilities.

On July 2, the Company announced the voluntary recall of approximately 200 TAXUS
Express(2) coronary stent systems, due to characteristics in the delivery
catheters that have the potential to impede balloon deflation during a coronary
angioplasty procedure. Further analysis and investigation of the TAXUS
Express(2) (paclitaxel-eluting) and Express(2) (bare metal) stent systems, both
of which share the same delivery catheter, revealed that certain additional
production lots exhibited these same characteristics. As

                                       30
<PAGE>

a result, on July 16, the Company announced that it was voluntarily expanding
the recall. The recall involved approximately 85,000 TAXUS stent systems and
approximately 11,000 Express(2) stent systems. On August 5, as a result of
ongoing monitoring, the Company announced that it was expanding the recall to
include approximately 3,000 additional TAXUS stent systems. The additional stent
systems remained within the parameters of the July 16 action. Overall, the
Company has shipped more than 600,000 TAXUS stent systems and more than 600,000
Express(2) stent systems. The Company continues to work with the Food and Drug
Administration (FDA) to monitor the deflation problem and will take additional
actions as necessary in the interest of patient safety.

As a result of its investigation, the Company has implemented reviews of its
manufacturing process, additional inspections, and an FDA-approved modification
to the manufacturing process for these products. The Company believes these
measures will be effective in reducing the occurrence of balloon non-deflation.
Following the recall, the Company increased its production of coronary stents
and used its existing supply of coronary stents not subject to the recall to
replenish the U.S. market. In addition, the Company believes that it will be
able to replenish the Europe and Inter-Continental markets during the third
quarter of 2004. However, the Company's ability to achieve the level of
interventional cardiology sales it had attained prior to the recall, and to
build on this sales level, may be impacted by physician confidence in the TAXUS
stent system, their return to historical purchasing patterns, and the
availability of TAXUS stent systems and competing drug-eluting stent products.

The worldwide coronary stent market is dynamic and highly competitive with
significant market share volatility. A material decline in the Company's
coronary stent revenue would likely have a material adverse impact on the future
operating results of the Company. The most significant variables impacting the
size of the coronary stent market and the Company's position within this market
include the adoption rate of drug-eluting stent technology, reimbursement
policies, the timing of new competitive launches, the average selling prices of
drug-eluting stent systems, delayed or limited regulatory approvals, unexpected
variations in clinical results or product performance, continued physician
acceptance, the availability of inventory to meet customer demand, the average
number of stents used per procedure, third-party intellectual property and the
outcome of litigation. Inconsistent clinical data from ongoing or future trials
conducted by the Company, or additional clinical data presented by the Company's
competitors, may impact the Company's position in and share of the drug-eluting
stent market.

Physicians have rapidly adopted drug-eluting technology in the U.S. The Company
believes that the more gradual adoption rates in Europe as compared to the U.S.
are primarily due to the timing of local reimbursement and funding levels. A
more gradual physician adoption rate may limit the number of procedures in which
the technology may be used and the price at which institutions may be willing to
purchase the technology.

The Company's drug-eluting stent system is currently one of only two
drug-eluting products in the market. The Company expects its share of the
drug-eluting stent market as well as unit prices to be adversely impacted as
additional competitors enter the drug-eluting stent market, which the Company
anticipates during 2004 and 2005

                                       31
<PAGE>

internationally and during 2006 in the U.S. During the second quarter of 2004,
one of the Company's competitors launched its drug-eluting stent in Japan. Until
the Company launches its drug-eluting stent in Japan, which is expected in 2006,
it is likely that its Japan coronary stent business will be subject to
significant share pressure. The Company anticipates launching its next
generation drug-eluting stent product, the Taxus(TM) Liberte(TM) coronary stent
system, in certain international markets in 2005 and in the U.S. in 2006,
subject to regulatory approval.

The manufacture of the TAXUS stent system involves the integration of multiple
technologies and complex processes. During 2004, the Company increased the
amount of TAXUS inventory on hand to meet the forecasted demand for the product.
Expected inventory levels may be impacted by replenishing recalled units,
significant favorable or unfavorable changes in forecasted demand and
disruptions associated with the TAXUS manufacturing process. In addition,
variability in expected demand, product mix and shelf-life may result in excess
or expired inventory positions and additional future inventory charges.

Further, there continues to be significant intellectual property litigation in
the coronary stent market. The Company is currently involved in a number of
legal proceedings with its competitors, including Johnson & Johnson, Medtronic
and Medinol Ltd. There can be no assurance that an adverse outcome in one or
more of these proceedings would not impact the Company's ability to meet its
objectives in the market. See the notes to the unaudited condensed consolidated
financial statements contained in this Quarterly Report, the Quarterly Report on
Form 10-Q for the quarter ended March 31, 2004 and the 2003 Annual Report filed
on Form 10-K for a description of these legal proceedings.

Since early 2001, the Company has consummated several business acquisitions.
Management believes it has developed a sound plan to integrate these businesses.
However, the failure to successfully integrate these businesses could impair the
Company's ability to realize the strategic and financial objectives of these
transactions. In connection with these acquisitions and other strategic
alliances, the Company has acquired numerous in-process research and development
platforms. As the Company continues to undertake strategic initiatives, it is
reasonable to assume that it will acquire additional in-process research and
development platforms.

In addition, the Company has entered a significant number of strategic alliances
with privately held and publicly traded companies. Many of these alliances
involve equity investments by the Company. The Company enters these strategic
alliances to broaden its product technology portfolio and to strengthen and
expand the Company's reach into existing and new markets. The success of these
alliances is an important element of the Company's growth strategy. However, the
full benefit of these alliances is often dependent on the strength of the other
companies' underlying technology. The inability to achieve regulatory approvals,
competitive product offerings, or litigation related to this technology may,
among other factors, prevent the Company from realizing the benefit of these
alliances. The Company regularly reviews its investments to determine whether
these investments are impaired. If so, the carrying value is written down to
fair value in the period identified. The Company's exposure to loss related to
its strategic

                                       32
<PAGE>

alliances is generally limited to its equity investments, notes receivable and
intangible assets associated with these alliances.

The Company expects to continue to invest significantly in its drug-eluting
stent program to achieve sustained worldwide market leadership positions. In
addition, the Company anticipates increasing its focus and spending on internal
research and development and other programs not associated with its TAXUS
drug-eluting stent technology. Further, the Company will continue to seek market
opportunities and growth through investments in strategic alliances and
acquisitions. Potential future acquisitions, including companies with whom
Boston Scientific currently has strategic alliances, may be dilutive to the
Company's earnings and may require additional financing, depending on their size
and nature.

International markets are also being affected by economic pressure to contain
reimbursement levels and health care costs. The Company's profitability from its
international operations may be limited by risks and uncertainties related to
economic conditions in these regions, foreign currency fluctuations, regulatory
and reimbursement approvals, competitive offerings, infrastructure development,
rights to intellectual property and the ability of the Company to implement its
overall business strategy. Any significant changes in the competitive,
political, regulatory, reimbursement or economic environment where the Company
conducts international operations may have a material impact on revenues and
profits, especially in Japan, given its high profitability relative to its
contribution to revenues. Further, the trend in countries around the world,
including Japan, toward more stringent regulatory requirements for product
clearance, changing reimbursement models, and more vigorous enforcement
activities has generally caused or may cause medical device manufacturers to
experience more uncertainty, greater risk and higher expenses. In addition, the
Company is required to renew regulatory approvals in certain international
jurisdictions, which may require additional testing and documentation. A
decision not to dedicate sufficient resources, or the failure to timely renew
these approvals, may limit the Company's ability to market its full line of
existing products within these jurisdictions.

These factors may impact the rate at which the Company can grow. However,
management believes that it continues to position the Company to take advantage
of opportunities that exist in the markets it serves.

                                       33
<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

Key performance indicators used by management to assess the liquidity of the
Company are as follows:

                                                           Six Months Ended
                                                                June 30,
(in millions)                                              2004         2003
-------------------------------------------------        --------     --------
Cash provided by operating activities                    $    574     $    354
Cash used for investing activities                          1,241          506
Cash provided by financing activities                         997          273
EBITDA(1)                                                     825          411

EBITDA for the six months ended June 30, 2004 and 2003 included pre-tax charges
of $64 million and $32 million, respectively. These pre-tax charges consisted of
purchased research and development costs attributable to acquisitions and a
litigation charge.

OPERATING ACTIVITIES
The increase in cash generated by operating activities was primarily
attributable to the increase in EBITDA offset by changes in operating assets and
liabilities. The increase in EBITDA in the six months ended June 30, 2004 as
compared to the same period in the prior year was primarily due to the first
quarter launch of the TAXUS stent system in the U.S. and sales of the TAXUS
stent system in the Company's Europe and Inter-Continental markets. A portion of
the cash generated from TAXUS sales was invested in the Company's sales,
clinical and manufacturing capabilities and in other research and development
projects.



--------------------------------------------------------------------------------
(1) The following represents a reconciliation between EBITDA and net income:

                                                           Six Months Ended
                                                                June 30,
(in millions)                                              2004         2003
-------------------------------------------------        --------     --------
Net income                                               $    507     $    211
Income taxes                                                  180           90
Interest expense                                               25           23
Interest income                                                (5)          (2)
Depreciation and amortization                                 118           89
EBITDA                                                   $    825     $    411

Management uses EBITDA to assess operating performance and believes it may
assist users of the financial statements in analyzing the underlying trends in
the Company's business over time. Users of the Company's financial statements
should consider this non-GAAP financial information in addition to, not as a
substitute for, or as superior to, financial information prepared in accordance
with GAAP.

                                       34
<PAGE>

Significant cash flow effects from operating assets and liabilities in the six
months ended June 30, 2004 included decreases in cash flow of approximately $260
million attributable to accounts receivable, partially offset by an increase in
accounts payable and accrued expenses of approximately $65 million. The increase
in trade accounts receivable was primarily due to sales growth, where payment is
not due until the third quarter of 2004. The increase in accounts payable and
accrued expenses was primarily the result of the increase in amounts due for
royalties attributable to sales growth of royalty-bearing products, including
TAXUS stent systems, and an increase in employee-related accruals.

INVESTING ACTIVITIES
The Company made capital expenditures of $135 million during the six months
ended June 30, 2004 as compared to $74 million for the same period in the prior
year. The increase in capital expenditures was primarily due to spending of $45
million related to the purchase of an office complex in the U.S. during the six
months ended June 30, 2004. The Company expects to incur capital expenditures of
approximately $200 million during the remainder of 2004, which includes
additional investments in the Company's facility network both in the U.S. and
abroad.

During 2004, the Company continued to invest in securities with maturity dates
that exceeded 90 days to benefit from higher returns. During the six months
ended June 30, 2004, the Company purchased approximately $307 million of these
investments and approximately $99 million of these investments matured. The
Company's investing activities during the six months ended June 30, 2004 also
included $90 million of cash proceeds from sales of privately held and publicly
traded equity securities; $804 million of payments attributable to the current
year acquisitions, net of cash acquired; $81 million of acquisition-related
payments primarily associated with Embolic Protection, Inc. and Inflow Dynamics,
Inc.; and $103 million of payments for strategic alliances with both privately
held and publicly traded entities.

FINANCING ACTIVITIES
During the six months ended June 30, 2004, the Company received proceeds from
borrowings of $820 million. Proceeds from debt issuances were used principally
to fund the acquisitions of Advanced Bionics and PVS, and other strategic
alliances. The Company's net debt (borrowings less cash, cash equivalents, and
investments in debt securities) increased by $293 million to $1,266 million at
June 30, 2004 from $973 million at December 31, 2003. In addition, during the
six months ended June 30, 2004, the Company received proceeds of $177 million in
connection with the issuance of shares of its common stock pursuant to its stock
option and employee stock purchase plans as compared to $126 million for the
same period in the prior year.

The Company's cash and cash equivalents primarily relate to non-U.S. operations.
The repatriation of cash balances from certain of the Company's non-U.S.
operations could have adverse tax consequences; however, those balances are
generally available without legal restrictions to fund ordinary business
operations. During 2003, the Company determined that it is likely to repatriate
cash from certain non-U.S. operations; the repatriated cash available for use
will be net of the related provisions for taxes.

                                       35
<PAGE>

BORROWINGS AND CREDIT ARRANGEMENTS
During the first half of 2004, the Company refinanced its existing $1,200
million credit facilities. At June 30, 2004, the Company's revolving credit
facilities totaled $2,020 million, consisting of a $1,500 million credit
facility that terminates in May 2009; a $500 million 364-day credit facility
that terminates in May 2005 and contains an option to convert into a one-year
term loan maturing in May 2006; and a $20 million uncommitted credit facility.
Use of the borrowings is unrestricted and the borrowings are unsecured.

The revolving credit facilities provide borrowing capacity and support the
Company's commercial paper. The Company had approximately $1,046 million and
$1,003 million of commercial paper outstanding at June 30, 2004 and December 31,
2003, respectively, at weighted average interest rates of 1.33 percent and 1.20
percent, respectively.

In addition, the Company increased its borrowing capacity under its revolving
credit and security facility, which is secured by the Company's domestic trade
receivables, from $200 million to $400 million. The Company had approximately
$382 million and $194 million of borrowings outstanding under its revolving
credit and security facility at June 30, 2004 and December 31, 2003,
respectively, at weighted average interest rates of 1.46 percent and 1.44
percent, respectively. The Company expects to renew the revolving credit and
security facility for an additional 364 days upon its maturity in August 2004.

The Company has the ability and intent to refinance a portion of its short-term
debt on a long-term basis through its revolving credit facilities. At June 30,
2004, the Company expects that a minimum of approximately $1,150 million of its
short-term obligations will remain outstanding beyond the next twelve months
and, accordingly, has classified this portion as long-term borrowings, as
compared to $650 million of short-term bank obligations classified as long-term
at December 31, 2003.

The Company had $500 million of senior notes outstanding at June 30, 2004 and
December 31, 2003 that are due March of 2005. These notes are registered
securities, bear a semi-annual coupon of 6.625 percent and are not redeemable
prior to maturity or subject to any sinking fund requirements. The Company has
classified these notes as a current liability at June 30, 2004.

In June 2004, due to favorable market conditions, the continued increase of
non-U.S. cash balances and to support the Company's strategic growth objectives,
the Company issued $600 million of senior notes due June 2014 under a Public
Debt Registration Statement previously filed with the U.S. Securities and
Exchange Commission (SEC). These notes bear a semi-annual coupon of 5.45
percent, are redeemable prior to maturity and are not subject to any sinking
fund requirements. The Company entered a fixed-to-floating interest rate swap to
hedge against changes in the fair value of these notes. The Company recorded
changes in the fair value of these notes since the inception of the interest
rate swap. Interest payments made or received under the interest rate swap
agreement are recorded as interest expense. Interest is payable at the six-month
LIBOR rate plus zero percent, which was approximately 1.94 percent at June 30,
2004.

                                       36
<PAGE>

In the second half of 2004, the Company expects to file a Public Registration
Statement with the SEC for the issuance of up to $1,500 million in various debt
and equity securities. The Company may seek to issue approximately $500 million
in debt securities under this Public Registration Statement during the remainder
of 2004.

CONTRACTUAL OBLIGATIONS AND COMMITMENTS
Certain of the Company's business combinations involve contingent consideration.
These payments, if and when made, are allocated to specific intangible asset
categories, including purchased research and development, with the remainder
assigned to goodwill as if the consideration had been paid as of the date of
acquisition. Payment of the additional consideration is generally contingent
upon the acquired companies reaching certain performance milestones, including
achieving specified revenue levels, product development targets or regulatory
approvals. At June 30, 2004 and December 31, 2003, the Company had accruals for
acquisition-related obligations of approximately $13 million and $79 million,
respectively. These accruals were recorded primarily as adjustments to goodwill
and purchased research and development. In addition, at June 30, 2004, the
estimated maximum potential amount of future contingent consideration
(undiscounted) that the Company could be required to make associated with its
business combinations is approximately $3.2 billion, some of which may be
payable in the Company's common stock. Certain earnout payments are based on
multiples of the acquired company's revenue during the earnout period, and
consequently, the total payments are not currently determinable. However, the
Company has developed an estimate of the maximum potential contingent
consideration for each of its acquisitions with an outstanding earnout
obligation. The milestones associated with the contingent consideration must be
reached in certain future periods ranging from 2004 through 2013. The estimated
cumulative specified revenue level associated with these maximum future
contingent payments is approximately $7.0 billion.

PRODUCT LIABILITY CLAIMS
The Company is substantially self-insured with respect to general and product
liability claims. In the normal course of its business, product liability claims
are asserted against the Company. The Company accrues anticipated costs of
litigation and loss for product liability claims based on historical experience,
or to the extent they are probable and estimable. Losses for claims in excess of
the limits of purchased insurance are recorded in earnings at the time and to
the extent they are probable and estimable. Product liability claims against the
Company will likely be asserted in the future related to events not known to
management at the present time. The absence of third-party insurance coverage
increases the Company's exposure to unanticipated claims or adverse decisions.
However, based on product liability losses experienced in the past, the election
to become substantially self-insured is not expected to have a material impact
on future operations.

Management believes that the Company's risk management practices, including
limited insurance coverage, are reasonably adequate to protect against
anticipated general and product liability losses. However, unanticipated
catastrophic losses could have a material adverse impact on the Company's
financial position, results of operations and liquidity.

                                       37
<PAGE>

CAUTIONARY STATEMENTS FOR PURPOSES OF THE SAFE HARBOR PROVISIONS OF THE PRIVATE
SECURITIES LITIGATION REFORM ACT OF 1995

This report contains forward-looking statements. The Company desires to take
advantage of the Safe Harbor Provisions of the Private Securities Litigation
Reform Act of 1995 and is including this statement for the express purpose of
availing itself of the protections of the safe harbor with respect to all
forward-looking statements. Forward-looking statements discussed in this report
include, but are not limited to, statements with respect to, and the Company's
performance may be affected by:

o    volatility in the coronary stent market, competitive offerings and the
     timing of receipt of regulatory approvals to market existing and
     anticipated drug-eluting stent technology and other coronary and peripheral
     stent platforms;
o    the Company's ability to continue significant growth in revenue, gross
     profit, earnings and cash flow resulting from the sale of the TAXUS
     drug-eluting stent system in the U.S., and to launch the TAXUS stent system
     in Japan in 2006;
o    the timing and continued availability of the TAXUS stent system in
     sufficient quantities and mix, the Company's ability to prevent disruptions
     to its TAXUS manufacturing processes and to maintain or replenish inventory
     levels consistent with forecasted demand around the world;
o    the impact of new drug-eluting stents on the size of the coronary stent
     market and distribution of share within the coronary stent market in the
     U.S. and around the world;
o    the overall performance and continued physician confidence in drug-eluting
     stents and the results of drug-eluting stent clinical trials undertaken by
     the Company or its competitors;
o    the Company's ability to capitalize on the opportunity in the drug-eluting
     stent market for continued growth in revenue and earnings and to maintain
     worldwide market leadership positions through reinvestment in the Company's
     drug-eluting stent program;
o    the Company's ability to take advantage of its position as one of two early
     entrants in the U.S. drug-eluting stent market, to anticipate competitor
     products as they enter the market and to take advantage of opportunities
     that exist in the markets it serves;
o    the ability of the Company to manage inventory levels, accounts receivable
     and gross margins relating to the Company's TAXUS stent system and to react
     effectively to worldwide economic and political conditions;
o    the Company's ability to successfully develop programs not associated with
     its TAXUS drug-eluting stent technology;
o    the Company's ability to manage research and development and other
     operating expenses in light of significant expected revenue growth;
o    the Company's ability to achieve benefits from its increased focus on
     internal research and development and its ability to capitalize on
     opportunities across its businesses;
o    the Company's ability to integrate the acquisitions and other strategic
     alliances it has consummated since early 2001;

                                       38
<PAGE>

o    the Company's ability to successfully complete planned clinical trials and
     to develop and launch products on a timely basis within cost estimates,
     including the successful completion of in-process projects from purchased
     research and development;
o    the timing, size and nature of strategic initiatives, market opportunities
     and research and development platforms available to the Company and the
     ultimate cost and success of these initiatives;
o    the Company's ability to maintain a 24 percent effective tax rate,
     excluding net special charges, during 2004 and to substantially recover its
     deferred tax assets;
o    the ability of the Company to meet its projected cash needs over the next
     twelve months, to maintain borrowing flexibility and to renew or refinance
     its borrowings beyond the next twelve months;
o    the Company's ability to issue debt or equity securities on terms
     reasonably acceptable to the Company;
o    risks associated with international operations including compliance with
     local legal and regulatory requirements;
o    the potential effect of foreign currency fluctuations and interest rate
     fluctuations on revenues, expenses and resulting margins;
o    the effect of litigation, risk management practices including self
     insurance, and compliance activities on the Company's loss contingency,
     legal provision and cash flow; and
o    the impact of stockholder, patent, product liability, Medinol Ltd. and
     other litigation, as well as the ultimate outcome of the U.S. Department of
     Justice investigation.

Several important factors, in addition to the specific factors discussed in
connection with each forward-looking statement individually, could affect the
future results and growth rates of the Company and could cause those results and
rates to differ materially from those expressed in the forward-looking
statements contained in this report. These additional factors include, among
other things, future economic, competitive, reimbursement and regulatory
conditions, new product introductions, demographic trends, third-party
intellectual property, financial market conditions and future business decisions
of the Company and its competitors, all of which are difficult or impossible to
predict accurately and many of which are beyond the control of the Company.
Therefore, the Company wishes to caution each reader of this report to consider
carefully these factors as well as the specific factors discussed with each
forward-looking statement in this report and as disclosed in the Company's
filings with the Securities and Exchange Commission. These factors, in some
cases, have affected, and in the future (together with other factors) could
affect, the ability of the Company to implement its business strategy and may
cause actual results to differ materially from those contemplated by the
statements expressed in this report.

ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company had currency derivative instruments outstanding in the notional
amount of $3,107 million and $1,724 million at June 30, 2004 and December 31,
2003, respectively. The Company recorded $37 million of assets and $34 million
of liabilities to recognize the fair value of these instruments at June 30,
2004, compared to $15 million of assets

                                       39
<PAGE>

and $84 million of liabilities to recognize the fair value of these instruments
at December 31, 2003. A 10 percent appreciation in the U.S. dollar's value
relative to the hedged currencies would increase the derivative instruments'
fair value by $120 million and $105 million at June 30, 2004 and December 31,
2003, respectively. A 10 percent depreciation in the U.S. dollar's value
relative to the hedged currencies would decrease the derivative instruments'
fair value by $122 million and $128 million at June 30, 2004 and December 31,
2003, respectively. Any increase or decrease in the fair value of the Company's
currency exchange rate sensitive derivative instruments would be substantially
offset by a corresponding decrease or increase in the fair value of the hedged
underlying asset, liability or cash flow.

The Company's earnings and cash flow exposure to interest rates consists of
fixed and floating rate debt instruments that are denominated primarily in U.S.
dollars and Japanese yen. The Company uses interest rate derivative instruments
to manage its exposure to interest rate movements and to reduce borrowing costs
by converting floating rate debt into fixed rate debt or fixed rate debt into
floating rate debt. The Company had interest rate derivative instruments
outstanding in the notional amount of $1,100 million and $500 million at June
30, 2004 and December 31, 2003, respectively. The fair values of these
instruments recorded on the Company's consolidated balance sheets at June 30,
2004 and December 31, 2003 are not material. A 100 basis point increase in
global interest rates would decrease the derivative instruments' fair value by
$51 million at June 30, 2004, compared to $7 million at December 31, 2003. A 100
basis point decrease in global interest rates would increase the derivative
instruments' fair value by $56 million at June 30, 2004, compared to $7 million
at December 31, 2003. Any increase or decrease in the fair value of the
Company's interest rate sensitive derivative instruments would be substantially
offset by a corresponding decrease or increase in the fair value of the hedged
underlying liability.


ITEM 4: CONTROLS AND PROCEDURES

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
The Company's management, with the participation of the Company's President and
Chief Executive Officer and Senior Vice President - Finance & Administration and
Chief Financial Officer, evaluated the effectiveness of the Company's disclosure
controls and procedures as of June 30, 2004 pursuant to Rule 13a-15(b) of the
Exchange Act. Disclosure controls ensure that material information required to
be disclosed by the Company in the report that it files or submits under the
Exchange Act is recorded, processed, summarized and reported within the time
periods specified in the SEC's rules and forms and ensure that such material
information is accumulated and communicated to the Company's management,
including the Company's Chief Executive Officer and Chief Financial Officer, as
appropriate to allow timely decisions regarding required disclosure. Based on
their evaluation, the Company's Chief Executive Officer and Chief Financial
Officer concluded that as of June 30, 2004, the Company's disclosure controls
and procedures were effective. It should be noted that any system of controls is
designed to provide reasonable, but not absolute, assurances that the system
will achieve its stated goals under all potential circumstances.

                                       40
<PAGE>

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING
During the quarter ended June 30, 2004, there were no changes in the Company's
internal controls over financial reporting that have materially affected, or are
reasonably likely to materially affect, the Company's internal control over
financial reporting.





























                                       41
<PAGE>


                                     PART II
                                OTHER INFORMATION

ITEM 1:       LEGAL PROCEEDINGS

              Note I - Commitments and Contingencies to the Company's unaudited
       condensed consolidated financial statements contained elsewhere in this
       Quarterly Report is incorporated herein by reference.

ITEM 4:       SUBMISSIONS OF MATTERS TO A VOTE OF SECURITY HOLDERS

              The Annual Meeting of Stockholders of the Company was held on May
              11, 2004, at which the Company's stockholders voted on:

              (i)   the election of four Class III Directors of the Company to
                    hold office until the 2007 Annual Meeting of Stockholders;
                    and

              (ii)  the ratification of the appointment of Ernst & Young LLP as
                    the Company's independent auditors for the fiscal year
                    ending December 31, 2004.

              A total of 680,918,461 shares, or approximately 82%, of the
       Company's common stock were present or represented by proxy at the
       meeting. The matters listed above were voted upon as follows:

              (i)   The individuals named below were re-elected to a three-year
                    term as Class III directors:


              --------------------------------------- --------------------------
                                                        VOTES         VOTES
                   NOMINEES                              FOR         WITHHELD
              --------------------------------------- --------------------------
              Class III
              --------------------------------------- ------------- ------------
                 Ursula M. Burns                      667,544,495   13,373,966
              --------------------------------------- ------------- ------------
                 Marye Anne Fox                       658,547,902   22,370,559
              --------------------------------------- ------------- ------------
                 N.J. Nicholas, Jr.                   653,033,560   27,884,901
              --------------------------------------- ------------- ------------
                 John E. Pepper                       648,615,795   32,302,666
              --------------------------------------- ------------- ------------

              John E. Abele, Joel L. Fleishman, Ray J. Groves, Ernest Mario,
              Peter M. Nicholas, Uwe E. Reinhardt, Senator Warren B. Rudman and
              James R. Tobin all continue to serve as directors of the Company.

              (ii)  The ratification of the appointment of Ernst & Young LLP as
                    the Company's independent auditors for the fiscal year
                    ending December 31, 2004 was approved by a vote of
                    647,961,784 shares voting for, 29,213,338 shares voting
                    against and 3,743,339 abstaining.

                                       42
<PAGE>

ITEM 6:       EXHIBITS AND REPORTS ON FORM 8-K

              (a)   Exhibits


                    10.1    Form of Amendment #4 to Credit and Security
                            Agreement dated as of May 20, 2004

                    10.2    Form of $1,500,000,000 Multi-Year Revolving Credit
                            Agreement dated as of May 14, 2004

                    10.3    Form of $500,000,000 364-Day Revolving Credit
                            Agreement dated as of May 14, 2004

                    31.1    Certification of the Chief Executive Officer
                            pursuant to Section 302 of the Sarbanes-Oxley Act of
                            2002

                    31.2    Certification of the Chief Financial Officer
                            pursuant to Section 302 of the Sarbanes-Oxley Act of
                            2002

                    32.1    Certification Pursuant to Section 906 of the
                            Sarbanes-Oxley Act of 2002, President and Chief
                            Executive Officer

                    32.2    Certification Pursuant to Section 906 of the
                            Sarbanes-Oxley Act of 2002, Senior Vice President
                            and Chief Financial Officer



              (b)   Reports on Form 8-K

                    The following reports were filed during the quarter ended
                    June 30, 2004:

                      Form 8-K     Date of Event            Description
                      --------     -------------            -----------

                      Items 2, 9   June 1, 2004       Announcement of execution
                                                      of Merger Agreement to
                                                      acquire 100 percent of the
                                                      fully diluted equity of
                                                      Advanced Bionics
                                                      Corporation

                      Item 2, 7    June 4, 2004       Announcement of completion
                                                      of acquisition of Advanced
                                                      Bionics Corporation

                      Item 5       June 22, 2004      Announcement of launch of
                                                      public debt offering

                      Item 5, 7    June 25, 2004      Announcement of issuance
                                                      of $600 million aggregate
                                                      principal amount of 5.45%
                                                      senior notes under the
                                                      Company's existing shelf
                                                      registration statement

                                       43
<PAGE>


                                    SIGNATURE


Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized on August 9, 2004.


                                      BOSTON SCIENTIFIC CORPORATION


                                      By:  /s/ Lawrence C. Best
                                         --------------------------------------
                                      Name:  Lawrence C. Best
                                      Title: Chief Financial Officer and Senior
                                             Vice President - Finance and
                                             Administration




























                                       44

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>2
<FILENAME>exhibit10-1_12848.txt
<DESCRIPTION>AMENDMENT #4 TO CREDIT & SECURITY AGREEMENT
<TEXT>
                                                                    EXHIBIT 10.1
                                                                    ------------
                                     FORM OF
                  AMENDMENT #4 TO CREDIT AND SECURITY AGREEMENT

     THIS AMENDMENT #4 TO CREDIT AND SECURITY AGREEMENT (this "AMENDMENT") is
entered into by the undersigned parties as of May 20, 2004 with respect to the
Credit and Security Agreement dated as of August 16, 2002, as amended (the
"CREDIT AND SECURITY AGREEMENT"), by and among Boston Scientific Funding
Corporation, a Delaware corporation ("BORROWER"), Boston Scientific Corporation,
a Delaware corporation, as initial Servicer, Blue Ridge Asset Funding
Corporation, a Delaware corporation ("BLUE RIDGE"), Victory Receivables
Corporation, a Delaware corporation ("VICTORY"), The Bank of Tokyo-Mitsubishi
Ltd., New York Branch, individually as a Liquidity Bank and as Victory Agent and
Wachovia Bank, National Association, individually as a Liquidity Bank, as Blue
Ridge Agent and as Administrative Agent, as amended from time to time.

UNLESS DEFINED ELSEWHERE HEREIN, CAPITALIZED TERMS USED IN THIS AMENDMENT SHALL
HAVE THE MEANINGS ASSIGNED TO SUCH TERMS IN THE CREDIT AND SECURITY AGREEMENT.

                                    RECITALS

     WHEREAS, the Borrower, the initial Servicer, Victory, Blue Ridge, The Bank
of Tokyo-Mitsubishi Ltd., New York Branch, individually as a Liquidity Bank and
as Victory Agent and Wachovia Bank, National Association, individually, as a
Liquidity Bank, as Blue Ridge Agent and as Administrative Agent entered into the
Credit and Security Agreement; and

     WHEREAS, the Borrower has requested that the Agents amend the Credit and
Security Agreement.

     NOW THEREFORE, in consideration of the mutual execution hereof and other
good and valuable consideration, the parties hereto agree as follows:

     1. AMENDMENT. Schedule A to the Credit and Security Agreement is hereby
amended and restated to read as follows, and the Commitments of the various
Lenders are hereby amended accordingly:

     ---------------------------------- ----------------------------------------
                     LENDER                          COMMITMENT
     ---------------------------------- ----------------------------------------
     Blue Ridge                         None

     ---------------------------------- ----------------------------------------
     Wachovia                           $120,000,000 from 8/16/02-5/19/04; and
                                        $240,000,000 from and after 5/20/04

     ---------------------------------- ----------------------------------------

<PAGE>
     ---------------------------------- ----------------------------------------
     Victory                            $80,000,000 (less amounts funded under
                                        BTM's Commitment) from 8/16/02-5/19/04;
                                        and $160,000,000 (less amounts funded
                                        under BTM's Commitment) from and after
                                        5/20/04

     ---------------------------------- ----------------------------------------
     BTM                                $80,000,000 (less amounts funded under
                                        Victory's Commitment) from
                                        8/16/02-5/19/04; and $160,000,000 (less
                                        amounts funded under Victory's
                                        Commitment) from and after 5/20/04

     ---------------------------------- ----------------------------------------


     2. CONDITIONS PRECEDENT TO EFFECTIVENESS. The effectiveness of this
Amendment is subject to the conditions precedent that (a) the Agents shall have
received counterparts hereof duly executed by each of the parties to the Credit
and Security Agreement, (b) Victory shall have received counterparts of an
amendment to the Victory Liquidity Agreement increasing the liquidity commitment
thereunder, duly executed by the parties thereto, and (c) Blue Ridge shall have
received counterparts of an amendment to the Blue Ridge Liquidity Agreement
increasing the liquidity commitment thereunder, duly executed by the parties
thereto. The signatures of Victory and Blue Ridge on counterparts of this
Amendment shall constitute confirmation that conditions (b) and (c),
respectively, have been satisfied.

     3. SCOPE OF AMENDMENT. Except as expressly amended hereby, the Credit and
Security Agreement remains in full force and effect in accordance with its terms
and this Amendment shall not by implication or otherwise alter, modify, amend or
in any way affect any of the other terms, conditions, obligations, covenants or
agreements contained in the Credit and Security Agreement, all of which are
ratified and affirmed in all respects and shall continue in full force and
effect.

     4. GOVERNING LAW. This Amendment shall be governed by and construed in
accordance with the laws of the State of New York.

     5. COUNTERPARTS. This Amendment may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed an
original, and all such counterparts shall together constitute but one and the
same instrument.


                            [SIGNATURE PAGES FOLLOW]


                                        2
<PAGE>


     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed and delivered by their duly authorized officers as of the date hereof.



                      BOSTON SCIENTIFIC FUNDING CORPORATION


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



                                  BOSTON SCIENTIFIC CORPORATION, AS SERVICER

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








                                        3
<PAGE>


                                  BLUE RIDGE ASSET FUNDING CORPORATION

                                  BY:  WACHOVIA CAPITAL MARKETS, LLC, ITS
                                       ATTORNEY-IN-FACT


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



                                  WACHOVIA BANK, NATIONAL ASSOCIATION,
                                  individually as a Liquidity Bank, as Blue
                                  Ridge Agent and as Administrative Agent


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






                                        4
<PAGE>

                                  VICTORY RECEIVABLES CORPORATION


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


                                  THE BANK OF TOKYO-MITSUBISHI LTD., NEW YORK
                                  BRANCH, as a Liquidity Bank



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



                                  THE BANK OF TOKYO-MITSUBISHI LTD., NEW YORK
                                  BRANCH, as Victory Agent

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







                                        5

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.2
<SEQUENCE>3
<FILENAME>exhibit10-2_12848.txt
<DESCRIPTION>MULTI-YEAR REVOLVING CREDIT AGREEMENT
<TEXT>
                                                                    EXHIBIT 10.2
                                                                    ------------
================================================================================

                                     FORM OF

                                 $1,500,000,000

                      MULTI-YEAR REVOLVING CREDIT AGREEMENT

                                      among


                         BOSTON SCIENTIFIC CORPORATION,
                                   AS BORROWER


                               THE SEVERAL LENDERS
                        FROM TIME TO TIME PARTIES HERETO,


                              BANK OF AMERICA, N.A.

                                       and

                      WACHOVIA BANK, NATIONAL ASSOCIATION,
                             AS SYNDICATION AGENTS,


                               ABN AMRO BANK N.V.,
                               CITICORP USA, INC.,
                        DEUTSCHE BANK AG NEW YORK BRANCH,
                    SUMITOMO MITSUI BANKING CORPORATION, AND
               THE BANK OF TOKYO-MITSUBISHI LTD., NEW YORK BRANCH,
                            AS DOCUMENTATION AGENTS,

                         BANC OF AMERICA SECURITIES LLC,
                                       AND
                          J.P. MORGAN SECURITIES INC.,
                 AS JOINT LEAD ARRANGERS AND JOINT BOOKRUNNERS,

                                  BNP PARIBAS,
                                       AND
                             MERRILL LYNCH BANK USA,
                               AS MANAGING AGENTS

                                       and


                              JPMORGAN CHASE BANK,
                             AS ADMINISTRATIVE AGENT

                            DATED AS OF MAY 14, 2004


================================================================================
<PAGE>

                                TABLE OF CONTENTS
                                                                            PAGE

SECTION 1      DEFINITIONS.....................................................1

      1.1      Defined Terms...................................................1

      1.2      Other Definitional Provisions..................................21


SECTION 2      AMOUNT AND TERMS OF COMMITMENTS................................21

      2.1      Revolving Credit Commitments...................................21

      2.2      Procedure for Revolving Credit Borrowing.......................22

      2.3      Swingline Commitment...........................................22

      2.4      Procedure for Swingline Borrowing;
               Refunding of Swingline Loans...................................23

      2.5      Facility Fee...................................................24

      2.6      Termination or Reduction of Commitments........................24

      2.7      Repayment of Revolving Credit Loans............................25

      2.8      CAF Advances...................................................25

      2.9      Procedure for CAF Advance Borrowing............................25

      2.10     Repayment of CAF Advances......................................28

      2.11     Certain Restrictions with Respect to CAF Advances..............28

      2.12     Multicurrency Commitments......................................28

      2.13     Repayment of Multicurrency Loans...............................29

      2.14     Procedure for Multicurrency Borrowing..........................29

      2.15     Termination or Reduction of Multicurrency Commitments..........29

      2.16     Borrowings of Revolving Credit Loans and Refunding of Loans....30

      2.17     [Intentionally omitted]........................................31


SECTION 3      CERTAIN PROVISIONS APPLICABLE TO THE LOANS.....................32

      3.1      Optional and Mandatory Prepayments.............................32

      3.2      Conversion and Continuation Options............................33

      3.3      Minimum Amounts and Maximum Number of Tranches.................33

      3.4      Interest Rates and Payment Dates...............................34

      3.5      Computation of Interest and Fees...............................34

      3.6      Inability to Determine Interest Rate...........................35

      3.7      Pro Rata Treatment and Payments................................35

      3.8      Illegality.....................................................37

      3.9      Requirements of Law............................................37


                                        i
<PAGE>
                                TABLE OF CONTENTS
                                   (continued)


      3.10     Taxes..........................................................39

      3.11     Indemnity......................................................40

      3.12     Change of Lending Office; Removal of Lender....................41

      3.13     Evidence of Debt...............................................41


SECTION 4      LOCAL CURRENCY FACILITIES......................................42

      4.1      Terms of Local Currency Facilities.............................42

      4.2      Reporting of Local Currency Outstandings.......................43


SECTION 5      LETTERS OF CREDIT..............................................44

      5.1      L/C Commitment.................................................44

      5.2      Procedure for Issuance of Letter of Credit.....................44

      5.3      Fees and Other Charges.........................................45

      5.4      L/C Participations.............................................45

      5.5      Reimbursement Obligation of the Borrower.......................46

      5.6      Obligations Absolute...........................................46

      5.7      Letter of Credit Payments......................................47

      5.8      Applications...................................................47

      5.9      Reimbursement Obligations for Certain Letters of Credit
               Denominated in Currencies Other Than Dollars...................47


SECTION 6      REPRESENTATIONS AND WARRANTIES.................................48

      6.1      Financial Condition............................................48

      6.2      No Change......................................................48

      6.3      Corporate Existence; Compliance with Law.......................48

      6.4      Corporate Power; Consents and Authorization;
               Enforceable Obligations........................................49

      6.5      No Legal Bar...................................................49

      6.6      No Material Litigation.........................................49

      6.7      No Default.....................................................49

      6.8      Intellectual Property..........................................50

      6.9      Taxes..........................................................50

      6.10     Federal Regulations............................................50

      6.11     ERISA..........................................................50


                                       ii
<PAGE>
                                TABLE OF CONTENTS
                                   (continued)


      6.12     Investment Company Act; Other Regulations......................51

      6.13     Purpose of Loans...............................................51

      6.14     Environmental Matters..........................................51

      6.15     Disclosure.....................................................52


SECTION 7      CONDITIONS PRECEDENT...........................................52

      7.1      Conditions to Initial Loans and Letters of Credit..............52

      7.2      Conditions to Each Loan and Letter of Credit...................53


SECTION 8      AFFIRMATIVE COVENANTS..........................................54

      8.1      Financial Statements...........................................54

      8.2      Certificates; Other Information................................55

      8.3      Payment of Obligations.........................................55

      8.4      Conduct of Business and Maintenance of Existence...............55

      8.5      Maintenance of Property; Insurance.............................55

      8.6      Inspection of Property; Books and Records; Discussions.........55

      8.7      Notices........................................................56


SECTION 9      NEGATIVE COVENANTS.............................................56

      9.1      Financial Covenant.............................................56

      9.2      Limitation on Liens............................................56

      9.3      Limitation on Indebtedness.....................................57

      9.4      Limitation on Fundamental Changes..............................58


SECTION 10     EVENTS OF DEFAULT..............................................58


SECTION 11     THE AGENTS.....................................................61

      11.1     Appointment....................................................61

      11.2     Delegation of Duties...........................................61

      11.3     Exculpatory Provisions.........................................62

      11.4     Reliance by Administrative Agent...............................62

      11.5     Notice of Default..............................................62

      11.6     Non-Reliance on Administrative Agent and Other Lenders.........63

      11.7     Indemnification................................................63

      11.8     Administrative Agent in Its Individual Capacity................64


                                       iii
<PAGE>
                                TABLE OF CONTENTS
                                   (continued)


      11.9     Successor Administrative Agent.................................64

      11.10    The Arrangers, the Bookrunners, the Syndication Agents
               and the Documentation Agents...................................64


SECTION 12     GUARANTEE......................................................64

      12.1     Guarantee......................................................64

      12.2     No Subrogation.................................................65

      12.3     Amendments, etc with respect to the Obligations;
               Waiver of Rights...............................................65

      12.4     Guarantee Absolute and Unconditional...........................66

      12.5     Reinstatement..................................................67

      12.6     Payments.......................................................67

      12.7     "Lenders"......................................................67


SECTION 13     MISCELLANEOUS..................................................68

      13.1     Amendments and Waivers.........................................68

      13.2     Notices........................................................69

      13.3     No Waiver; Cumulative Remedies.................................70

      13.4     Survival of Representations and Warranties.....................70

      13.5     Payment of Expenses and Taxes..................................70

      13.6     Successors and Assigns; Participations and Assignments.........71

      13.7     Adjustments; Set-off...........................................73

      13.8     Counterparts...................................................74

      13.9     Severability...................................................74

      13.10    Integration....................................................74

      13.11    GOVERNING LAW..................................................74

      13.12    Submission To Jurisdiction; Waivers............................74

      13.13    Acknowledgements...............................................75

      13.14    Confidentiality................................................75

      13.15    Loan Conversion/Participations.................................76

      13.16    Judgment.......................................................77

      13.17    WAIVERS OF JURY TRIAL..........................................77

      13.18    USA Patriot Act Notice.........................................77


                                       iv
<PAGE>

SCHEDULES

Schedule I            Names, Addresses and Commitments of Lenders
Schedule II           Information Concerning Local Currency Loans
Schedule 5.1          Existing Letters of Credit
Schedule 9.2          Existing Liens



EXHIBITS

Exhibit A             Form of Revolving Credit Note
Exhibit B             Form of CAF Advance Note
Exhibit C             Form of CAF Advance Request
Exhibit D             Form of CAF Advance Offer
Exhibit E             Form of CAF Advance Confirmation
Exhibit F             Form of Closing Certificate
Exhibit G             Form of Opinion of Counsel to Borrower
Exhibit H             Form of Assignment and Acceptance
Exhibit I             Form of Local Currency Facility Addendum
Exhibit J             Form of Exemption Certificate
















                                        v
<PAGE>

         MULTI-YEAR REVOLVING CREDIT AGREEMENT, dated as of May 14, 2004, among
(i) BOSTON SCIENTIFIC CORPORATION, a Delaware corporation (the "Borrower"), (ii)
the several banks and other financial institutions or entities from time to time
parties hereto (the "Lenders"), (iii) BANK OF AMERICA, N.A., and WACHOVIA BANK,
NATIONAL ASSOCIATION, as Syndication Agents (each, in such capacity, a
"Syndication Agent", and collectively, the "Syndication Agents"), (iv) ABN AMRO
BANK, CITICORP USA, INC., DEUTSCHE BANK AG NEW YORK BRANCH, SUMITOMO MITSUI
BANKING CORPORATION and THE BANK OF TOKYO-MITSUBISHI, LTD., NEW YORK BRANCH, as
co-documentation agents (collectively, the "Documentation Agents"), (v) BANC OF
AMERICA SECURITIES LLC and J.P. MORGAN SECURITIES INC., as Joint Lead Arrangers
(each, in such capacity, an "Arranger", and collectively, the "Arrangers") and
as Joint Bookrunners (each in such capacity, a "Bookrunner", and collectively,
the "Bookrunners"), (vi) BNP PARIBAS and MERRILL LYNCH BANK USA, as Managing
Agents (each, in such capacity a "Managing Agent", and collectively, the
"Managing Agents"), and (vii) JPMORGAN CHASE BANK, as administrative agent for
the Lenders hereunder (in such capacity, the "Administrative Agent").

                              W I T N E S S E T H:

         WHEREAS, the Borrower, certain of the Lenders, the Arrangers, the
Administrative Agent and others are parties to the Credit Agreement, dated as of
August 15, 2001 (as amended, supplemented or otherwise modified prior to the
date hereof, the "Existing Multi-Year Credit Facility");

         WHEREAS, the Borrower has requested that the Lenders make available a
five-year credit facility as described herein to replace the Existing Multi-Year
Credit Facility, which shall be repaid in full and all commitments and
agreements with respect thereto shall be terminated on or prior to the Closing
Date; and

         WHEREAS, the Lenders have agreed to make a five-year credit facility
available upon the terms and subject to the conditions set forth herein;

         NOW, THEREFORE, in consideration of the premises, and of the mutual
covenants and agreements herein contained and other good and valuable
consideration, receipt of which is hereby acknowledged, the parties hereto
hereby agree as follows:

                                   SECTION 1.
                                   DEFINITIONS

1.1      DEFINED TERMS.  As used in this Agreement, the following terms shall
have the following meanings:

         "ABR": for any day, a rate per annum (rounded upwards, if necessary, to
the next 1/16 of 1%) equal to the greatest of (a) the Prime Rate in effect on
such day, (b) the Base CD Rate in effect on such day plus 1% and (c) the Federal
Funds Effective Rate in effect on such day plus 1/2 of 1%. For purposes hereof:
"Prime Rate" shall mean the rate of interest per annum publicly announced from
time to time by JPMorgan Chase Bank as its prime rate in effect at its principal
office in New York City (the Prime Rate not being intended to be the lowest rate
of interest
<PAGE>

charged by JPMorgan Chase Bank in connection with extensions of credit to
debtors); "Base CD Rate" shall mean the sum of (a) the product of (i) the
Three-Month Secondary CD Rate and (ii) a fraction, the numerator of which is one
and the denominator of which is one minus the C/D Reserve Percentage and (b) the
C/D Assessment Rate; "Three-Month Secondary CD Rate" shall mean, for any day,
the secondary market rate for three-month certificates of deposit reported as
being in effect on such day (or, if such day shall not be a Business Day, the
next preceding Business Day) by the Board of Governors of the Federal Reserve
System (the "Board") through the public information telephone line of the
Federal Reserve Bank of New York (which rate will, under the current practices
of the Board, be published in Federal Reserve Statistical Release H.15(519)
during the week following such day), or, if such rate shall not be so reported
on such day or such next preceding Business Day, the average of the secondary
market quotations for three-month certificates of deposit of major money center
banks in New York City received at approximately 10:00 A.M., New York City time,
on such day (or, if such day shall not be a Business Day, on the next preceding
Business Day) by the Administrative Agent from three New York City negotiable
certificate of deposit dealers of recognized standing selected by it; and
"Federal Funds Effective Rate" shall mean, for any day, the weighted average of
the rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day that is a Business Day, the average of the
quotations for the day of such transactions received by the Administrative Agent
from three federal funds brokers of recognized standing selected by it. Any
change in the ABR due to a change in the Prime Rate, the Three-Month Secondary
CD Rate or the Federal Funds Effective Rate shall be effective as of the opening
of business on the effective day of such change in the Prime Rate, the
Three-Month Secondary CD Rate or the Federal Funds Effective Rate, respectively.

         "ABR Loans": Revolving Credit Loans and Swingline Loans bearing
interest based upon the ABR.

         "Adjusted Aggregate Committed Outstandings": with respect to each
Lender, the Aggregate Committed Outstandings of such Lender, plus the amount of
any participating interests purchased by such Lender pursuant to subsection
13.15, minus the amount of any participating interests sold by such Lender
pursuant to subsection 13.15.

         "Administrative Agent": as defined in the preamble hereto.

         "Affiliate": as to any Person, any other Person (other than a
Subsidiary) which, directly or indirectly, is in control of, is controlled by,
or is under common control with, such Person. For purposes of this definition,
"control" of a Person means the power, directly or indirectly, either to (a)
vote 10% or more of the securities having ordinary voting power for the election
of directors of such Person or (b) direct or cause the direction of the
management and policies of such Person, whether by contract or otherwise.

         "Agents": the collective reference to the Administrative Agent, the
Syndication Agents, the Documentation Agents, the Managing Agents, the Arrangers
and the Bookrunners.

                                        2
<PAGE>

         "Aggregate Available Multicurrency Commitments": as at any date of
determination with respect to all Multicurrency Lenders, an amount in Dollars
equal to the sum of the Available Multicurrency Commitments of all Multicurrency
Lenders on such date.

         "Aggregate Available Revolving Credit Commitments": as at any date of
determination with respect to all Lenders, an amount in Dollars equal to the sum
of the Available Revolving Credit Commitments of all Lenders on such date.

         "Aggregate Committed Outstandings": as at any date of determination
with respect to any Lender, an amount in Dollars equal to the sum of (a) the
Aggregate Revolving Credit Outstandings of such Lender on such date, (b) the
Dollar Equivalent of the Aggregate Multicurrency Outstandings of such Lender on
such date, and (c) the Dollar Equivalent of the Aggregate Local Currency
Outstandings of such Lender on such date.

         "Aggregate Local Currency Outstandings": as at any date of
determination with respect to any Lender, an amount in the applicable Local
Currencies equal to the aggregate unpaid principal amount of such Lender's Local
Currency Loans.

         "Aggregate Multicurrency Outstandings": as at any date of determination
with respect to any Lender, an amount in the applicable Available Foreign
Currencies equal to the aggregate unpaid principal amount of such Lender's
Multicurrency Loans.

         "Aggregate Revolving Credit Commitments": the aggregate amount of the
Revolving Credit Commitments of all of the Lenders.

         "Aggregate Revolving Credit Outstandings": as at any date of
determination with respect to any Lender, an amount in Dollars equal to the sum
of (a) the aggregate unpaid principal amount of such Lender's Revolving Credit
Loans on such date plus (b) such Lender's Revolving Credit Commitment Percentage
of (i) the aggregate outstanding principal of Swingline Loans and (ii) the L/C
Obligations.

         "Aggregate Total Outstandings": as at any date of determination with
respect to any Lender, an amount in Dollars equal to the sum of (a) the
Aggregate Revolving Credit Outstandings of such Lender on such date, (b) the
Dollar Equivalent of the aggregate unpaid principal amount of such Lender's CAF
Advances on such date, (c) the Dollar Equivalent of the Aggregate Multicurrency
Outstandings of such Lender on such date and (d) the Dollar Equivalent of the
Aggregate Local Currency Outstandings of such Lender on such date.

         "Agreement": this Multi-Year Revolving Credit Agreement, as amended,
amended and restated, supplemented or otherwise modified from time to time.

         "Agreement Currency": as defined in subsection 13.16(b).

                                        3
<PAGE>

         "Applicable Margin": with respect to each day for each Type of Loan,
the rate per annum based on the Ratings in effect on such day, as set forth
under the relevant column heading below:

<TABLE><CAPTION>
Any Date Other than an Excess
     Utilization Day                                           Excess Utilization Day
     ---------------                                           ----------------------
                  Eurodollar Loans/                       Eurodollar Loans/
Rating           Multicurrency Loans      ABR Loans      Multicurrency Loans      ABR Loans
----------       -------------------      ---------      -------------------      ---------
<S>              <C>                      <C>            <C>                      <C>
Rating I                .140%                 0%                .265%                 0%
Rating II               .170%                 0%                .295%                 0%
Rating III              .285%                 0%                .410%                 0%
Rating IV               .425%                 0%                .550%                 0%
Rating V                .500%                 0%                .625%                 0%
Rating VI               .775%                 0%                .900%                 0%
</TABLE>


         "Application": an application, in such form as the Issuing Lender may
specify from time to time, requesting the Issuing Lender to issue a Letter of
Credit.

         "Arrangers": as defined in the preamble hereto.

         "Assignee": as defined in subsection 13.6(c).

         "Available Foreign Currencies": euro, Japanese Yen, Australian Dollar,
Canadian Dollar, Pound Sterling, Singapore Dollar, Swiss Franc and any other
available and freely convertible non-Dollar currency selected by the Borrower
and approved by the Administrative Agent and the Multicurrency Lenders.

         "Available Multicurrency Commitment": as at any date of determination
with respect to any Multicurrency Lender (after giving effect to the making and
payment of any Revolving Credit Loans required to be made on such date pursuant
to subsection 2.16), an amount in Dollars equal to the lesser of (a) the excess,
if any, of (i) the amount of such Multicurrency Lender's Multicurrency
Commitment in effect on such date over (ii) the Dollar Equivalent of the
Aggregate Multicurrency Outstandings of such Multicurrency Lender on such date,
and (b) the excess, if any, of (i) the amount of such Lender's Revolving Credit
Commitment in effect on such date over (ii) the Aggregate Committed Outstandings
of such Lender on such date.

         "Available Revolving Credit Commitment": as at any date of
determination with respect to any Lender (after giving effect to the making and
payment of any Revolving Credit Loans required to be made on such date pursuant
to subsection 2.16), an amount in Dollars equal to the excess, if any, of (a)
the amount of such Lender's Revolving Credit Commitment in effect on such date
over (b) the Aggregate Committed Outstandings of such Lender on such date.

         "Base CD Rate": as defined in the definition of ABR.

         "benefited Lender": as defined in subsection 13.7.

         "Board": as defined in the definition of ABR.

                                        4
<PAGE>

         "Bookrunners": as defined in the preamble hereto.

         "Borrower": as defined in the preamble hereto.

         "Borrowing Date": any Business Day specified in a notice pursuant to
subsection 2.2, 2.9 or 2.14 as a date on which the Borrower requests the Lenders
to make Loans hereunder or, with respect to Local Currency Loans, the date on
which a Foreign Subsidiary Borrower requests Local Currency Lenders to make
Local Currency Loans to such Foreign Subsidiary Borrower pursuant to the Local
Currency Facility to which such Foreign Subsidiary Borrower and Local Currency
Lenders are parties.

         "Business": as defined in subsection 6.14.

         "Business Day": a day other than a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law to
close; provided that when such term is used for the purpose of determining the
date on which the Eurocurrency Base Rate is determined under this Agreement for
any Loan denominated in euro for any Interest Period therefor and for purposes
of determining the first and last day of any such Interest Period, references in
this Agreement to Business Days shall be deemed to be references to Target
Operating Days.

         "CAF Advance": each competitive advance facility advance made pursuant
to subsection 2.8.

         "CAF Advance Availability Period": the period from and including the
Closing Date to and including the date which is seven days prior to the
Termination Date.

         "CAF Advance Confirmation": each confirmation by the Borrower of its
acceptance of CAF Advance Offers, which confirmation shall be substantially in
the form of Exhibit E and shall be delivered to the Administrative Agent by
facsimile transmission.

         "CAF Advance Interest Payment Date": as to each CAF Advance, each
interest payment date specified by the Borrower for such CAF Advance in the
related CAF Advance Request.

         "CAF Advance Maturity Date": as to any CAF Advance, the date specified
by the Borrower pursuant to subsection 2.9(d)(ii) in its acceptance of the
related CAF Advance Offer.

         "CAF Advance Note": as defined in subsection 3.13(e).

         "CAF Advance Offer": each offer by a Lender to make CAF Advances
pursuant to a CAF Advance Request, which offer shall contain the information
specified in Exhibit D and shall be delivered to the Administrative Agent by
telephone, immediately confirmed by facsimile transmission.

         "CAF Advance Request": each request by the Borrower for Lenders to
submit bids to make CAF Advances, which request shall contain the information in
respect of such requested CAF Advances specified in Exhibit C and shall be
delivered to the Administrative Agent in

                                        5
<PAGE>

writing, by facsimile transmission, or by telephone, immediately confirmed by
facsimile transmission.

         "Capital Lease Obligations": as to any Person, 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, for the purposes of
this Agreement, the amount of such obligations at any time shall be the
capitalized amount thereof at such time determined in accordance with GAAP.

         "Capital Stock": 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 or options to purchase any of the foregoing.

         "C/D Assessment Rate": for any day as applied to any ABR Loan, the
annual assessment rate in effect on such day which is payable by a member of the
Bank Insurance Fund maintained by the Federal Deposit Insurance Corporation (the
"FDIC") classified as well-capitalized and within supervisory subgroup "B" (or a
comparable successor assessment risk classification) within the meaning of 12
C.F.R. ss. 327.4 (or any successor provision) to the FDIC (or any successor) for
the FDIC's (or such successor's) insuring time deposits at offices of such
institution in the United States.

         "C/D Reserve Percentage": for any day as applied to any ABR Loan, that
percentage (expressed as a decimal) which is in effect on such day, as
prescribed by the Board, for determining the maximum reserve requirement for a
Depositary Institution (as defined in Regulation D of the Board) in respect of
new non-personal time deposits in Dollars having a maturity of 30 days or more.

         "Closing Date": the date, on or before May 28, 2004, on which
conditions precedent set forth in subsection 7.1 shall be satisfied.

         "Code": the Internal Revenue Code of 1986, as amended from time to
time.

         "Commitment Period": the period from and including the Closing Date to
but excluding the Termination Date or such earlier date on which the Commitments
shall terminate as provided herein.

         "Commitments": the collective reference to the Revolving Credit
Commitments, Multicurrency Commitments, Swingline Commitments and L/C
Commitments.

         "Committed Outstandings Percentage": on any date with respect to any
Lender, the percentage which the Adjusted Aggregate Committed Outstandings of
such Lender constitutes of the Adjusted Aggregate Committed Outstandings of all
Lenders.

         "Commonly Controlled Entity": an entity, whether or not incorporated,
which is under common control with the Borrower within the meaning of Section
4001 of ERISA or is part of a

                                        6
<PAGE>

group which includes the Borrower and which is treated as a single employer
under Section 414 of the Code.

         "Conduit Lender": any special purpose corporation organized and
administered by any Lender for the purpose of making Loans otherwise required to
be made by such Lender and designated by such Lender in a written instrument;
provided, that the designation by any Lender of a Conduit Lender shall not
relieve the designating Lender of any of its obligations to fund a Loan under
this Agreement if, for any reason, its Conduit Lender fails to fund any such
Loan, and the designating Lender (and not the Conduit Lender) shall have the
sole right and responsibility to deliver all consents and waivers required or
requested under this Agreement with respect to its Conduit Lender; and provided,
further, that no Conduit Lender shall (a) be entitled to receive any greater
amount pursuant to Section 3.9, 3.10, 3.11 or 13.5 than the designating Lender
would have been entitled to receive in respect of the extensions of credit made
by such Conduit Lender or (b) be deemed to have any Commitment.

         "Consolidated EBITDA": of any Person for any period, Consolidated Net
Income of such Person and its Subsidiaries for such period plus, without
duplication and to the extent reflected as a charge in the statement of such
Consolidated Net Income for such period, the sum of (a) income tax expense, (b)
Consolidated Interest Expense of such Person and its Subsidiaries, amortization
or writeoff of debt discount and debt issuance costs and commissions, discounts
and other fees and charges associated with Indebtedness, (c) depreciation
expense, (d) amortization of intangibles (including, but not limited to,
goodwill) and organization costs and (e) any extraordinary, unusual or
nonrecurring expenses or losses (to the extent any of the foregoing are non-cash
items) (including, whether or not otherwise includable as a separate item in the
statement of such Consolidated Net Income for such period, losses on sales of
assets outside of the ordinary course of business and including special charges
and purchased research and development charges in connection with acquisitions),
and minus, to the extent included in the statement of such Consolidated Net
Income for such period, the sum of (a) interest income (except to the extent
deducted in determining Consolidated Interest Expense) and (b) any
extraordinary, unusual or non-recurring income or gains (to the extent any of
the foregoing are non-cash items) (including, whether or not otherwise
includable as a separate item in the statement of such Consolidated Net Income
for such period, gains on the sales of assets outside of the ordinary course of
business).

         "Consolidated Interest Expense": of any Person for any period, total
interest expense of such Person and its Subsidiaries for such period with
respect to all outstanding Indebtedness of such Person and its Subsidiaries
determined in accordance with GAAP (including, all net costs that are allocable
to such period in accordance with GAAP).

         "Consolidated Leverage Ratio": as at the last day of any period of four
consecutive fiscal quarters of the Borrower, the ratio of (a) Consolidated Total
Debt on such day to (b) Consolidated EBITDA of the Borrower and its Subsidiaries
for such period.

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

                                        7
<PAGE>

         "Consolidated Tangible Assets": at any date, Consolidated Total Assets
minus (without duplication) the net book value of all assets which would be
treated as intangible assets, as determined on a consolidated basis in
accordance with GAAP.

         "Consolidated Total Assets": at any date, the net book value of all
assets of the Borrower and its Subsidiaries as determined on a consolidated
basis in accordance with GAAP.

         "Consolidated Total Debt": 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.

         "Continuing Directors": as defined in Section 10(h).

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

         "Conversion Date": any date on which either (a) an Event of Default
under subsection 10(e) has occurred or (b) the Commitments shall have been
terminated and/or the Loans shall have been declared immediately due and payable
pursuant to Section 10.

         "Conversion Sharing Percentage": on any date with respect to any Lender
and any Loans of such Lender outstanding in any currency other than Dollars, the
percentage of such Loans such that, after giving effect to the conversion of
such Loans to Dollars and the purchase and sale by such Lender of participating
interests as contemplated by subsection 13.15, the Committed Outstandings
Percentage of such Lender will equal such Lender's Revolving Credit Commitment
Percentage on such date (calculated immediately prior to giving effect to any
termination or expiration of the Commitments on the Conversion Date).

         "Converted Loans: as defined in subsection 13.15(a).

         "Default": any of the events specified in Section 10, whether or not
any requirement for the giving of notice, the lapse of time, or both, or any
other condition, has been satisfied.

         "Documentation Agents": as defined in the preamble hereto.

         "Dollar Equivalent": with respect to an amount denominated in any
currency other than Dollars, the equivalent in Dollars of such amount determined
at the Exchange Rate on the date of determination of such equivalent. In making
any determination of the Dollar Equivalent for purposes of calculating the
amount of Loans to be borrowed from the respective Lenders on any Borrowing
Date, the Administrative Agent shall use the relevant Exchange Rate in effect on
the date on which the interest rate for such Loans is determined pursuant to the
provisions of this Agreement and the other Loan Documents.

         "Dollars" and "$": dollars in lawful currency of the United States of
America.

         "Environmental Laws": any and all applicable foreign, Federal, state,
local or municipal laws, rules, regulations, statutes, ordinances, codes,
decrees or other enforceable requirements or

                                        8
<PAGE>

orders of any Governmental Authority or other Requirements of Law regulating,
relating to or imposing liability or standards of conduct concerning protection
of human health or the environment, as now or may at any time hereafter be in
effect.

         "ERISA": the Employee Retirement Income Security Act of 1974, as
amended from time to time.

         "euro": the single currency of participating member states of the
European Union.

         "Eurocurrency Base Rate": (a) with respect to each day during each
Interest Period pertaining to a Eurodollar Loan, or a Multicurrency Loan or CAF
Advance denominated in any currency other than Pounds Sterling, the rate per
annum determined by the Administrative Agent to be the offered rate for deposits
in the applicable currency with a term comparable to such Interest Period that
appears on the applicable Telerate Page at approximately 11:00 A.M., London
time, two Business Days prior to the beginning of such Interest Period;
provided, however, that if at any time for any reason such offered rate for any
such currency does not appear on a Telerate Page, "Eurocurrency Base Rate" shall
mean, with respect to each day during each Interest Period pertaining to a Loan
denominated in such currency, the rate per annum equal to the average (rounded
upward to the nearest 1/16th of 1%) of the respective rates notified to the
Administrative Agent by each of the Reference Lenders as the rate at which such
Reference Lender is offered deposits in such currency at or about 11:00 A.M.,
London time, two Business Days prior to the beginning of such Interest Period in
the London interbank market for delivery on the first day of such Interest
Period for the number of days comprised therein; and (b) with respect to each
day during each Interest Period pertaining to a Multicurrency Loan or CAF
Advance denominated in Pounds Sterling, the rate per annum equal to the average
(rounded upward to the nearest 1/16th of 1%) of the respective rates notified to
the Administrative Agent by each of the Reference Lenders as the rate at which
such Reference Lender is offered deposits in Pounds Sterling at or about 11:00
A.M., London time, two Business Days prior to the beginning of such Interest
Period in the Paris interbank market for delivery on the first day of such
Interest Period for the number of days comprised therein.

         "Eurocurrency Rate": with respect to each day during each Interest
Period pertaining to a Loan, a rate per annum determined for such day in
accordance with the following formula (rounded upward to the nearest 1/100th of
1%):

                             Eurocurrency Base Rate
                    ----------------------------------------
                    1.00 - Eurocurrency Reserve Requirements


         "Eurocurrency Reserve Requirements": for any day as applied to a Loan,
the aggregate (without duplication) of the rates (expressed as a decimal) of
reserve requirements in effect on such day (including, without limitation,
basic, supplemental, marginal and emergency reserves) under any regulations of
the Board or other Governmental Authority having jurisdiction with respect
thereto dealing with reserve requirements prescribed for eurocurrency funding
(currently referred to as "Eurocurrency Liabilities" in Regulation D of such
Board) maintained by a member bank of such System.

                                        9
<PAGE>

         "Eurodollar Loans": Revolving Credit Loans, the rate of interest
applicable to which is based upon the Eurocurrency Rate for Dollars.

         "Event of Default": any of the events specified in Section 10, provided
that any requirement for the giving of notice, the lapse of time, or both, or
any other condition, has been satisfied.

         "Excess Utilization Day": any day on which the sum of the Aggregate
Total Outstandings of all Lenders, plus the Total Outstandings under (and as
defined in) the 364-Day Credit Agreement, exceeds 50.0% of the aggregate amount
of the Revolving Credit Commitments hereunder and the Commitments under (and as
defined in) the 364-Day Credit Agreement (or, in each case, with respect to any
day after termination of such Revolving Credit Commitments and Commitments,
50.0% of the aggregate amount of the Revolving Credit Commitments hereunder and
Commitments under (and as defined in) the 364-Day Credit Facility in effect on
the date immediately prior to the date on which such Revolving Credit
Commitments and Commitments terminated).

         "Exchange Rate": with respect to any non-Dollar currency on any date,
the rate at which such currency may be exchanged into Dollars, as set forth on
such date on the relevant Reuters currency page at or about 11:00 A.M., London
time, on such date. In the event that such rate does not appear on any Reuters
currency page, the "Exchange Rate" with respect to such non-Dollar currency
shall be determined by reference to such other publicly available service for
displaying exchange rates as may be agreed upon by the Administrative Agent and
the Borrower or, in the absence of such agreement, such "Exchange Rate" shall
instead be the Administrative Agent's spot rate of exchange in the interbank
market where its foreign currency exchange operations in respect of such non-
Dollar currency are then being conducted, at or about 10:00 A.M., local time, on
such date for the purchase of Dollars with such non-Dollar currency, for
delivery two Business Days later; provided, that if at the time of any such
determination, no such spot rate can reasonably be quoted, the Administrative
Agent may use any reasonable method as it deems applicable to determine such
rate, and such determination shall be conclusive absent manifest error.

         "Existing 364-Day Credit Facility": the 364-Day Revolving Credit
Agreement dated as of May 30, 2003, as amended, among the Borrower, the lenders
parties thereto, JPMorgan Chase Bank, as administrative agent, and others,
providing for a $600,000,000 revolving credit and competitive advance facility.

         "Existing Credit Facilities": the collective reference to the Existing
Multi-Year Credit Facility and the Existing 364-Day Credit Facility.

         "Existing Letters of Credit": letters of credit issued under the
Existing Credit Facilities, as set forth in Schedule 5.1 attached hereto.

         "Existing Multi-Year Credit Facility": as defined in the recitals
hereto.

                                       10
<PAGE>

         "Facility Fee Rate": for each day during each calculation period, the
rate per annum based on the Ratings in effect on such day, as set forth below:

                                                         Facility
                              Rating                     Fee Rate
                              ------                     --------
                              Rating I                     .060%
                              Rating II                    .080%
                              Rating III                   .090%
                              Rating IV                    .125%
                              Rating V                     .175%
                              Rating VI                    .225%

         "Fee Commencement Date": the Closing Date.

         "Financing Lease": any lease of property, real or personal, the
obligations of the lessee in respect of which are required in accordance with
GAAP to be capitalized on a balance sheet of the lessee.

         "Fixed Rate CAF Advance": any CAF Advance made pursuant to a Fixed Rate
CAF Advance Request.

         "Fixed Rate CAF Advance Request": any CAF Advance Request requesting
the Lenders to offer to make CAF Advances at a fixed rate (as opposed to a rate
composed of the Eurocurrency Rate plus (or minus) a margin).

         "Foreign Subsidiary Borrower": each Subsidiary of the Borrower
organized under the laws of a jurisdiction outside the United States that the
Borrower designates as a "Foreign Subsidiary Borrower" in a Local Currency
Facility Addendum.

         "Funding Commitment Percentage": as at any date of determination (after
giving effect to the making and payment of any Loans made on such date pursuant
to subsection 2.16), with respect to any Lender, that percentage which the
Available Revolving Credit Commitment of such Lender then constitutes of the
Aggregate Available Revolving Credit Commitments.

         "GAAP": generally accepted accounting principles in the United States
of America consistent with those utilized in preparing the audited financial
statements referred to in subsection 6.1.

         "Governmental Authority": any nation or government, any state or other
political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government.

         "Guarantee Obligation": as to any Person (the "guaranteeing person"),
any obligation of (a) the guaranteeing person or (b) another Person (including,
without limitation, any bank under any letter of credit) to induce the creation
of which the guaranteeing person has issued a reimbursement, counterindemnity or
similar obligation, in either case guaranteeing or in effect guaranteeing any
Indebtedness, leases, dividends or other obligations (the "primary obligations")

                                       11
<PAGE>

of any other unrelated third Person (the "primary obligor") in any manner,
whether directly or indirectly, including, without limitation, any obligation of
the guaranteeing person, whether or not contingent, (i) to purchase any such
primary obligation or any property constituting direct or indirect security
therefor, (ii) to advance or supply funds (1) for the purchase or payment of any
such primary obligation or (2) to maintain working capital or equity capital of
the primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (iii) to purchase property, securities or services primarily
for the purpose of assuring the owner of any such primary obligation of the
ability of the primary obligor to make payment of such primary obligation or
(iv) otherwise to assure or hold harmless the owner of any such primary
obligation against loss in respect thereof; provided, however, that the term
Guarantee Obligation shall not include endorsements of instruments for deposit
or collection in the ordinary course of business. The amount of any Guarantee
Obligation of any guaranteeing person shall be deemed to be the lower of (a) an
amount equal to the stated or determinable amount of the primary obligation in
respect of which such Guarantee Obligation is made and (b) the maximum amount
for which such guaranteeing person may be liable pursuant to the terms of the
instrument embodying such Guarantee Obligation, unless such primary obligation
and the maximum amount for which such guaranteeing person may be liable are not
stated or determinable, in which case the amount of such Guarantee Obligation
shall be such guaranteeing person's reasonably anticipated liability in respect
thereof as determined by the Borrower in good faith.

         "Hedge Agreements": all agreements with non-related third parties with
respect to any swap, forward, future or derivative transaction or option or
similar agreements involving, or settled by reference to, one or more rates,
currencies, commodities, equity or debt instruments or securities, or economic,
financial or pricing indices or measures of economic, financial or pricing risk
or value or any similar transaction or any combination of these transactions;
provided that no employee benefit plan of the Borrower or any of its
Subsidiaries shall be a "Hedge Agreement".

         "Indebtedness": of any Person at any date, without duplication, (a) all
obligations of such Person for borrowed money, (b) all obligations of such
Person for the deferred purchase price of property or services (other than
current trade liabilities incurred in the ordinary course of such Person's
business and payable in accordance with customary practices and earn-outs and
other similar obligations in respect of acquisition and other similar
agreements), (c) all obligations of such Person evidenced by notes, bonds,
debentures or other similar instruments, (d) all indebtedness created or arising
under any conditional sale or other title retention agreement with respect to
property acquired by such Person (even though the rights and remedies of the
seller or lender under such agreement in the event of default are limited to
repossession or sale of such property), (e) all Capital Lease Obligations of
such Person, (f) all obligations of such Person, contingent or otherwise, as an
account party or applicant under or in respect of acceptances, letters of
credit, surety bonds or similar arrangements, (g) the liquidation value of all
redeemable preferred Capital Stock of such Person, (h) all indebtedness of such
Person, determined in accordance with GAAP, arising out of a Receivables
Transaction, (i) all Guarantee Obligations of such Person in respect of
obligations of the kind referred to in clauses (a) through (h) above, (j) all
obligations of the kind referred to in clauses (a) through (i) above secured by
(or for which the holder of such obligation has an existing right, contingent or
otherwise, to be secured by) any Lien on property (including accounts and
contract rights) owned by such Person, whether or not such Person has assumed or
become liable for the payment of such obligation, and (k) for the purposes of
Section 10(d) only, all obligations of such Person in respect of Hedge
Agreements.

                                       12
<PAGE>

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

         "Insolvency": with respect to any Multiemployer Plan, the condition
that such Plan is insolvent within the meaning of Section 4245 of ERISA.

         "Insolvent": pertaining to a condition of Insolvency.

         "Interest Payment Date": (a) as to any ABR Loan, the last day of each
March, June, September and December, (b) as to any Eurodollar Loan or
Multicurrency Loan having an Interest Period of three months or less, the last
day of such Interest Period, and (c) as to any Eurodollar Loan or Multicurrency
Loan having an Interest Period longer than three months, each day which is three
months, or a whole multiple thereof, after the first day of such Interest Period
and the last day of such Interest Period.

         "Interest Period": (a) with respect to any Eurodollar Loan or
Multicurrency Loan:

                  (i) initially, the period commencing on the Borrowing Date or
         conversion date, as the case may be, with respect to such Eurodollar
         Loan or Multicurrency Loan and ending one, two, three, six or nine
         months thereafter, as selected by the Borrower in its notice of
         borrowing or notice of conversion, as the case may be, given with
         respect thereto; and

                  (ii) thereafter, each period commencing on the last day of the
         next preceding Interest Period applicable to such Eurodollar Loan or
         Multicurrency Loan and ending one, two, three, six or nine months
         thereafter, as selected by the Borrower by irrevocable notice to the
         Administrative Agent not less than three Business Days prior to the
         last day of the then current Interest Period with respect thereto;

provided that, all of the foregoing provisions relating to Interest Periods are
subject to the following:

                           (1) if any Interest Period would otherwise end on a
                  day that is not a Business Day, such Interest Period shall be
                  extended to the next succeeding Business Day unless the result
                  of such extension would be to carry such Interest Period into
                  another calendar month in which event such Interest Period
                  shall end on the immediately preceding Business Day;

                           (2) any Interest Period in respect of any Loan made
                  by any Lender that would otherwise extend beyond the
                  Termination Date applicable to such Lender shall end on such
                  Termination Date; and

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

                                       13
<PAGE>

         (b) with respect to any LIBO Rate CAF Advance, the period beginning on
the Borrowing Date with respect thereto and ending on the CAF Advance Maturity
Date with respect thereto.

         "Issuing Lender": JPMorgan Chase Bank, in its capacity as issuer of any
Letter of Credit.

         "JPMorgan Chase Bank": JPMorgan Chase Bank, a New York banking
corporation.

         "Judgment Currency": as defined in subsection 13.16(b).

         "L/C Commitment": $600,000,000.

         "L/C Fee Payment Date": the last day of each March, June, September and
December and the last day of the Commitment Period.

         "L/C Obligations": at any time, an amount equal to the sum of (a) the
aggregate then undrawn and unexpired amount of the then outstanding Letters of
Credit and (b) the aggregate amount of drawings under Letters of Credit that
have not then been reimbursed pursuant to subsection 5.5.

         "L/C Participants": the collective reference to all the Lenders other
than the Issuing Lender.

         "Lender Affiliate": (a) any Affiliate of any Lender, (b) any Person
that is administered or managed by any Lender and that is engaged in making,
purchasing, holding or otherwise investing in commercial loans and similar
extensions of credit in the ordinary course of its business and (c) with respect
to any Lender which is a fund that invests in commercial loans and similar
extensions of credit, any other fund that invests in commercial loans and
similar extensions of credit and is managed or advised by the same investment
advisor as such Lender or by an Affiliate of such Lender or investment advisor.

         "Lenders": as defined in the preamble hereto; provided, that unless the
context otherwise requires, each reference herein to the Lenders shall be deemed
to include any Conduit Lender.

         "Letters of Credit": as defined in subsection 5.1(a).

         "LIBO Rate CAF Advance": any CAF Advance made pursuant to a LIBO Rate
CAF Advance Request.

         "LIBO Rate CAF Advance Request": any CAF Advance Request requesting the
Lenders to offer to make CAF Advances at an interest rate equal to the
Eurocurrency Rate for the currency of such CAF Advance plus (or minus) a margin.

         "Lien": any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge or other security
interest or any preference,

                                       14
<PAGE>

priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including, without limitation, any conditional sale or other
title retention agreement and any Financing Lease having substantially the same
economic effect as any of the foregoing).

         "Loan": any Revolving Credit Loan, CAF Advance, Multicurrency Loan,
Swingline Loan or Local Currency Loan, as the case may be.

         "Loan Documents": this Agreement, any Notes, the Applications and any
document or instrument evidencing or governing any Local Currency Facility.

         "Loans to be Converted": as defined in subsection 13.15(a).

         "Local Currency": any available and freely convertible non-Dollar
currency selected by a Foreign Subsidiary Borrower and approved by the
Administrative Agent.

         "Local Currency Facility": any Qualified Credit Facility that the
Borrower designates as a "Local Currency Facility" pursuant to a Local Currency
Facility Addendum.

         "Local Currency Facility Addendum": a Local Currency Facility Addendum
received by the Administrative Agent, substantially in the form of Exhibit I,
and conforming to the requirements of Section 4.

         "Local Currency Facility Agent": with respect to each Local Currency
Facility, the Local Currency Lender acting as agent for the Local Currency
Lenders parties thereto (and, in the case of any Local Currency Facility to
which only one Lender is a party, such Lender).

         "Local Currency Facility Maximum Borrowing Amount": as defined in
subsection 4.1(b).

         "Local Currency Lender": any Lender (or, if applicable, any Affiliate,
branch or agency thereof) party to a Local Currency Facility.

         "Local Currency Lender Maximum Borrowing Amount": as defined in
subsection 4.1(b).

         "Local Currency Loan": any loan made pursuant to a Local Currency
Facility.

         "London Banking Day": any day on which banks in London are open for
general banking business, including dealings in foreign currency and exchange.

         "Majority Lenders": (a) at any time prior to the termination of the
Revolving Credit Commitments, Lenders, the Revolving Credit Commitment
Percentages of which aggregate more than 50%; and (b) at any time after the
termination of the Revolving Credit Commitments, Lenders whose Aggregate Total
Outstandings aggregate more than 50% of the Aggregate Total Outstandings of all
Lenders; provided that for purposes of this definition, the Aggregate Total
Outstandings of each Lender shall be adjusted upward or downward so as to give
effect to any participations or assignments effected pursuant to subsection
13.15.

         "Majority Multicurrency Lenders": at any time, Multicurrency Lenders
the Multicurrency Commitment Percentages of which aggregate more than 50%.

                                       15
<PAGE>

         "Managing Agents": as defined in the preamble hereto.

         "Material Adverse Effect": a material adverse effect on (a) the
business, operations, property 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 any of the other Loan Documents or the
rights or remedies of the Administrative Agent or the Lenders hereunder or
thereunder.

         "Materials of Environmental Concern": any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products or any
hazardous or toxic substances, materials or wastes, defined or regulated as such
in or under any Environmental Law, including, without limitation, asbestos,
polychlorinated biphenyls and urea-formaldehyde insulation.

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

         "Multicurrency Commitment": as to any Multicurrency Lender at any time,
its obligation to make Multicurrency Loans to the Borrower in an aggregate
amount in Available Foreign Currencies the Dollar Equivalent of which does not
exceed at any time outstanding the amount set forth opposite such Multicurrency
Lender's name in Schedule I under the heading "Multicurrency Commitment", as
such amount may be reduced from time to time as provided in subsection 2.15 and
the other applicable provisions hereof.

         "Multicurrency Commitment Percentage": as to any Multicurrency Lender
at any time, the percentage which such Multicurrency Lender's Multicurrency
Commitment at such time constitutes of the aggregate Multicurrency Commitments
of all Multicurrency Lenders at such time (or, if the Multicurrency Commitments
have terminated or expired, the percentage which (a) the Dollar Equivalent of
the Aggregate Multicurrency Outstandings of such Multicurrency Lender at such
time constitutes of (b) the Dollar Equivalent of the Aggregate Multicurrency
Outstandings of all Multicurrency Lenders at such time).

         "Multicurrency Lender": each Lender having an amount greater than zero
set forth opposite such Lender's name in Schedule I under the heading
"Multicurrency Commitment."

         "Multicurrency Loans": as defined in subsection 2.12.

         "Multiemployer Plan": a Plan which is a multiemployer plan as defined
in Section 4001(a)(3) of ERISA.

         "Non-Excluded Taxes": as defined in subsection 3.10.

         "Non-Multicurrency Lender": each Lender which is not a Multicurrency
Lender.

         "Notes": the collective reference to any Revolving Credit Notes and any
CAF Advance Notes.

         "Notice of Local Currency Outstandings": with respect to each Local
Currency Facility Agreement, a notice from the relevant Local Currency Facility
Agent containing the information, delivered to the Administrative Agent and any
other Person, in the manner and by the time, specified for a Notice of Local
Currency Outstandings in Schedule II.

                                       16
<PAGE>

         "Notice of Multicurrency Loan Borrowing": with respect to a
Multicurrency Loan, a notice from the Borrower containing the information in
respect of such Loan, delivered to the Administrative Agent and any other
Person, in the manner and by the time, specified for a Notice of Multicurrency
Loan Borrowing in respect of the currency of such Loan in Schedule II.

         "Notice of Multicurrency Loan Continuation": with respect to a
Multicurrency Loan, a notice from the Borrower containing the information in
respect of such Loan, delivered to the Person, in the manner and by the time,
specified for a Notice of Multicurrency Loan Continuation in respect of the
currency of such Loan in Schedule II.

         "Obligations": collectively, the unpaid principal of and interest on
the Loans and all other obligations and liabilities of each Foreign Subsidiary
Borrower under this Agreement and any Local Currency Facility and other Loan
Documents to which it is a party (including, without limitation, interest
accruing at the then applicable rate provided in this Agreement or any other
applicable Loan Document after the maturity of the Loans and interest accruing
at the then applicable rate provided in this Agreement or any other applicable
Loan Document after the filing of any petition in bankruptcy, or the
commencement of any insolvency, reorganization or like proceeding, relating to
such Foreign Subsidiary Borrower, whether or not a claim for post-filing or
post-petition interest is allowed in such proceeding), whether direct or
indirect, absolute or contingent, due or to become due, or now existing or
hereafter incurred, which may arise under, out of, or in connection with, this
Agreement, the Notes, the other Loan Documents, Hedge Agreements entered into
with Lenders or any other document made, delivered or given in connection
therewith, in each case whether on account of principal, interest, reimbursement
obligations, fees, indemnities, costs, expenses or otherwise (including, without
limitation, all fees and disbursements of counsel to the Administrative Agent or
to the Lenders that are required to be paid by any Foreign Subsidiary Borrower
pursuant to the terms of this Agreement or any other Loan Document).

         "Participant": as defined in subsection 13.6(b).

         "Patriot Act": as defined in subsection 13.18.

         "PBGC": the Pension Benefit Guaranty Corporation established pursuant
to Subtitle A of Title IV of ERISA.

         "Person": an individual, partnership, corporation, business trust,
joint stock company, trust, unincorporated association, joint venture,
Governmental Authority or other entity of whatever nature.

         "Plan": at a particular time, any employee benefit plan which is
covered by ERISA and in respect of which the Borrower or a Commonly Controlled
Entity is (or, if such plan were terminated at such time, would under Section
4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.

         "Properties": as defined in subsection 6.14.

         "Qualified Credit Facility": a credit facility (a) providing for one or
more Local Currency Lenders to make unsecured loans denominated in a Local
Currency to a Foreign Subsidiary

                                       17
<PAGE>

Borrower, (b) providing for such loans to bear interest at a rate or rates
determined by the Borrower and such Local Currency Lender or Local Currency
Lenders and (c) otherwise conforming to the requirements of Section 4.

         "Rating": the respective rating of each of the Rating Agencies
applicable to the long-term senior unsecured non-credit enhanced debt of the
Borrower, as announced by the Rating Agencies from time to time.

         "Rating Agencies": collectively, S&P and Moody's.

         "Rating Category": each of Rating I, Rating II, Rating III, Rating IV,
Rating V and Rating VI.

         "Rating I, Rating II, Rating III, Rating IV, Rating V and Rating VI":
the respective Ratings set forth below:

         Rating
         Category              S&P                     Moody's
         --------              ---                     -------
         Rating I          greater than             greater than
                           or equal to A+           or equal to A1

         Rating II         A                        A2

         Rating III        A-                       A3

         Rating IV         BBB+                     Baa1

         Rating V          BBB                      Baa2

         Rating VI         lower than or            lower than or
                           equal to BBB-            equal to Baa3

; provided, that (i) if on any day the Ratings of the Rating Agencies do not
fall in the same Rating Category, and the lower of such Ratings (i.e., the
Rating Category designated by a numerically higher Roman numeral) is one Rating
Category lower than the higher of such Ratings, then the Rating Category of the
higher of such Ratings shall be applicable for such day, (ii) if on any day the
Ratings of the Rating Agencies do not fall in the same Rating Category, and the
lower of such Ratings is more than one Rating Category lower than the higher of
such Ratings, then the Rating Category next higher from that of the lower of
such Ratings shall be applicable for such day, (iii) if on any day the Rating of
only one of the Rating Agencies is available, then the Rating Category of such
Rating shall be applicable for such day and (iv) if on any day a Rating is
available from neither of the Rating Agencies, then Rating VI shall be
applicable for such day. Any change in the applicable Rating Category resulting
from a change in the Rating of a Rating Agency shall become effective on the
date such change is publicly announced by such Rating Agency.

         "Receivables": any accounts receivable of any Person, including,
without limitation, any thereof constituting or evidenced by chattel paper,
instruments or general intangibles (as defined

                                       18
<PAGE>

in the Uniform Commercial Code of the State of New York), and all proceeds
thereof and rights (contractual and other) and collateral related thereto.

         "Receivables Subsidiary": any special purpose, bankruptcy remote
Subsidiary of the Borrower that purchases, on a revolving basis, Receivables
generated by the Borrower or any of its Subsidiaries.

         "Receivables Transaction": any transactions or series of related
transactions providing for the financing of Receivables of the Borrower or any
of its Subsidiaries.

         "Reference Lenders": Bank of America, N.A., JPMorgan Chase Bank, ABN
Amro Bank N.V., Deutsche Bank AG New York Branch, Tokyo-Mitsubishi, Ltd.,
Citibank, N.A. and Sumitomo Mitsui Banking Corporation.

         "Refunded Swingline Loans": as defined in subsection 2.4(b).

         "Refunding Date": as defined in subsection 2.4(c).

         "Register": as defined in subsection 13.6(d).

         "Reimbursement Obligation": the obligation of the Borrower to reimburse
the Issuing Lender pursuant to subsection 5.5(a) for amounts drawn under Letters
of Credit.

         "Related Parties": with respect to any Person, such Person's Affiliates
and partners, officers, employees, agents and advisors of such Person and such
Person's Affiliates.

         "Reorganization": with respect to any Multiemployer Plan, the condition
that such plan is in reorganization within the meaning of Section 4241 of ERISA.

         "Reportable Event": any of the events set forth in Section 4043(c) of
ERISA, other than those events as to which the thirty day notice period is
waived under subsections .27, .28, .29, .30, .31, .32, .34 or .35 of PBGC
Reg.ss.4043.

         "Requested Local Currency Loans": as defined in subsection 2.16(b).

         "Requested Multicurrency Loans": as defined in subsection 2.16(a).

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

         "Responsible Officer": with respect to the Borrower, the chief
executive officer and the president of the Borrower or, with respect to
financial matters, the chief financial officer of the Borrower.

                                       19
<PAGE>

         "Revolving Credit Commitment": as to any Lender, the obligation of such
Lender to make Revolving Credit Loans to the Borrower hereunder in an aggregate
principal amount at any one time outstanding not to exceed the amount set forth
opposite such Lender's name on Schedule I under the heading "Revolving Credit
Commitment," as such amount may be reduced or increased from time to time in
accordance with the provisions of this Agreement.

         "Revolving Credit Commitment Percentage": as to any Lender at any time,
the percentage which such Lender's Revolving Credit Commitment at such time
constitutes of the Aggregate Revolving Credit Commitments at such time (or, if
the Revolving Credit Commitments have terminated or expired, the percentage
which (a) the Aggregate Revolving Credit Outstandings of such Lender at such
time then constitutes of (b) the Aggregate Revolving Credit Outstandings of all
Lenders at such time).

         "Revolving Credit Loans": as defined in subsection 2.1.

         "Revolving Credit Note": as defined in subsection 3.13(d).

         "Revolving Lender": each Lender that has a Revolving Credit Commitment
hereunder or that holds Revolving Credit Loans.

         "S&P": Standard & Poor's Ratings Services.

         "Signing Date": the date on which the Lenders have signed this
Agreement.

         "Single Employer Plan": any Plan that is covered by Title IV of ERISA,
but that is not a Multiemployer Plan.

         "Subsidiary": as to any Person, a corporation, limited liability
company, partnership or other entity of which shares of stock or other ownership
interests having ordinary voting power (other than stock or such other ownership
interests having such power only by reason of the happening of a contingency) to
elect a majority of the board of directors or other managers of such
corporation, partnership or other entity are at the time owned, or the
management of which is otherwise controlled, directly or indirectly through one
or more intermediaries, or both, by such Person. Unless otherwise qualified, all
references to a "Subsidiary" or to "Subsidiaries" in this Agreement shall refer
to a Subsidiary or Subsidiaries of the Borrower.

         "Swingline Commitment": the obligation of the Swingline Lender to make
Swingline Loans pursuant to subsection 2.3 in an aggregate principal amount at
any one time outstanding not to exceed $100,000,000.

         "Swingline Lender": JPMorgan Chase Bank, in its capacity as the lender
of Swingline Loans.

         "Swingline Loans": as defined in subsection 2.3. Swingline Loans will
only be made available in Dollars.

         "Swingline Participation Amount": as defined in subsection 2.4(c).

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<PAGE>

         "Syndication Agents": as defined in the preamble hereto.

         "Target Operating Day": any day that is not (a) a Saturday or Sunday,
(b) Christmas Day or New Year's Day or (c) any other day on which the
Trans-European Real-time Gross Settlement Operating System (or any successor
settlement system) is not operating (as determined by the Administrative Agent).

         "Termination Date": May 13, 2009.

         "364-Day Credit Agreement": the 364-Day Revolving Credit Agreement,
dated as of even date herewith, among the Borrower, the lenders party thereto,
the Arrangers, the Administrative Agent and the other parties thereto, as the
same may from time to time be amended, amended and restated, supplemented or
otherwise modified.

         "Tranche": the collective reference to Eurodollar Loans or
Multicurrency Loans the then current Interest Periods with respect to all of
which begin on the same date and end on the same later date (whether or not such
Loans shall originally have been made on the same day); Tranches may be
identified as "Eurodollar Tranches" or "Multicurrency Tranches".

         "Transferee": as defined in subsection 13.6(f).

         "Type": as to any Revolving Credit Loan, its nature as an ABR Loan or a
Eurodollar Loan.

         1.2  OTHER DEFINITIONAL PROVISIONS. (a) Unless otherwise specified
therein, all terms defined in this Agreement shall have the defined meanings
when used in any Notes or any certificate or other document made or delivered
pursuant hereto.

         (b)  As used herein and in any Notes, and any certificate or other
document made or delivered pursuant hereto, accounting terms relating to the
Borrower and its Subsidiaries not defined in subsection 1.1 and accounting terms
partly defined in subsection 1.1, to the extent not defined, shall have the
respective meanings given to them under GAAP.

         (c)  The words "hereof", "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and Section, subsection,
Schedule and Exhibit references are to this Agreement unless otherwise
specified.

         (d)  The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.

                                    SECTION 2
                         AMOUNT AND TERMS OF COMMITMENTS

         2.1   REVOLVING CREDIT COMMITMENTS. (a) Subject to the terms and
conditions hereof, each Lender severally agrees to make revolving credit loans
("Revolving Credit Loans") in Dollars to the Borrower from time to time during
the Commitment Period so long as after giving effect thereto (i) the Available
Revolving Credit Commitment of each Lender is greater

                                       21
<PAGE>

than or equal to zero and (ii) the Aggregate Total Outstandings of all Lenders
do not exceed the Aggregate Revolving Credit Commitments. During the Commitment
Period, the Borrower may use the Revolving Credit Commitments by borrowing,
prepaying the Revolving Credit Loans in whole or in part, and reborrowing, all
in accordance with the terms and conditions hereof.

         (b)  The Revolving Credit Loans may from time to time be (i) Eurodollar
Loans, (ii) ABR Loans or (iii) a combination thereof, as determined by the
Borrower and notified to the Administrative Agent in accordance with subsections
2.2 and 3.2, provided that no Revolving Credit Loan shall be made as a
Eurodollar Loan after the day that is one month prior to the Termination Date.

         2.2  PROCEDURE FOR REVOLVING CREDIT BORROWING. The Borrower may borrow
under the Revolving Credit Commitments during the Commitment Period on any
Business Day, provided that the Borrower shall give the Administrative Agent
irrevocable notice (which notice must be received by the Administrative Agent
prior to 10:00 A.M., New York City time, (a) three Business Days prior to the
requested Borrowing Date, if all or any part of the requested Revolving Credit
Loans are to be initially Eurodollar Loans or (b) on the requested Borrowing
Date, otherwise), in each case specifying (i) the amount to be borrowed, (ii)
the requested Borrowing Date, (iii) whether the borrowing is to be of Eurodollar
Loans, ABR Loans or a combination thereof and (iv) if the borrowing is to be
entirely or partly of Eurodollar Loans, the amount of such Type of Loan and the
length of the initial Interest Period therefor. Each borrowing under the
Revolving Credit Commitments (other than a borrowing under subsections 2.4, 2.16
and 5.5) shall be in an amount equal to (x) in the case of ABR Loans, $5,000,000
or a whole multiple of $1,000,000 in excess thereof (or, if the Aggregate
Available Revolving Credit Commitments are less than $1,000,000, such lesser
amount) and (y) in the case of Eurodollar Loans, $5,000,000 or a whole multiple
of $1,000,000 in excess thereof. Upon receipt of any such notice from the
Borrower, the Administrative Agent shall promptly notify each Lender thereof.
Prior to 11:00 A.M., New York City time, on the Borrowing Date requested by the
Borrower, each Lender will make an amount equal to its Funding Commitment
Percentage of the principal amount of the Revolving Credit Loans requested to be
made on such Borrowing Date available to the Administrative Agent for the
account of the Borrower at the New York office of the Administrative Agent
specified in subsection 13.2 in funds immediately available to the
Administrative Agent. Except as otherwise provided in subsection 2.16, such
borrowing will then be made available to the Borrower by the Administrative
Agent crediting the account of the Borrower on the books of such office with the
aggregate of the amounts made available to the Administrative Agent by the
Lenders and in like funds as received by the Administrative Agent.

         2.3   SWINGLINE COMMITMENT. (a) Subject to the terms and conditions
hereof, the Swingline Lender agrees to make a portion of the credit otherwise
available to the Borrower under the Revolving Credit Commitments from time to
time during the Commitment Period by making swing line loans ("Swingline Loans")
to the Borrower; provided that (i) the aggregate principal amount of Swingline
Loans outstanding at any time shall not exceed the Swingline Commitment then in
effect (notwithstanding that the Swingline Loans outstanding at any time, when
aggregated with the Swingline Lender's other outstanding Revolving Credit Loans,
may exceed the Swingline Commitment then in effect) and (ii) the Borrower shall
not request, and the Swingline Lender shall not make, any Swingline Loan if,
after giving effect to the making of such Swingline Loan, the aggregate amount
of the Available Revolving Credit Commitments of

                                       22
<PAGE>

the Swingline Lender would be less than zero. During the Commitment Period, the
Borrower may use the Swingline Commitment by borrowing, repaying and
reborrowing, all in accordance with the terms and conditions hereof. Swingline
Loans shall be ABR Loans only.

         (b) The Borrower shall repay all outstanding Swingline Loans on the
Termination Date.

         2.4 PROCEDURE FOR SWINGLINE BORROWING; REFUNDING OF SWINGLINE LOANS.
(a) Whenever the Borrower desires that the Swingline Lender make Swingline Loans
it shall give the Swingline Lender irrevocable telephonic notice confirmed
promptly in writing (which telephonic notice must be received by the Swingline
Lender not later than 1:00 P.M., New York City time, on the proposed Borrowing
Date), specifying (i) the amount to be borrowed and (ii) the requested Borrowing
Date (which shall be a Business Day during the Revolving Commitment Period).
Each borrowing under the Swingline Commitment shall be in an amount equal to
$500,000 or a whole multiple of $100,000 in excess thereof. Not later than 3:00
P.M., New York City time, on the Borrowing Date specified in a notice in respect
of Swingline Loans, the Swingline Lender shall make available to the
Administrative Agent at the Funding Office an amount in immediately available
funds equal to the amount of the Swingline Loan to be made by the Swingline
Lender. The Administrative Agent shall make the proceeds of such Swingline Loan
available to the Borrower on such Borrowing Date by depositing such proceeds in
the account of the Borrower with the Administrative Agent on such Borrowing Date
in immediately available funds.

         (b) The Swingline Lender, at any time and from time to time in its sole
and absolute discretion may, on behalf of the Borrower (which hereby irrevocably
directs the Swingline Lender to act on its behalf), on one Business Day's notice
given by the Swingline Lender no later than 12:00 Noon, New York City time,
request each Lender (including the Swingline Lender in its capacity as a Lender
having a Revolving Credit Commitment) to make, and each Lender hereby agrees to
make, a Revolving Credit Loan that is an ABR Loan, in an amount equal to such
Lender's Revolving Credit Commitment Percentage of the aggregate amount of the
Swingline Loans (the "Refunded Swingline Loans") outstanding on the date of such
notice, to repay the Swingline Lender. Each Lender shall make the amount of such
Revolving Credit Loan available to the Administrative Agent at the New York
office of the Administrative Agent specified in subsection 13.2 in immediately
available funds, not later than 10:00 A.M., New York City time, one Business Day
after the date of such notice. The proceeds of such Revolving Credit Loans shall
be immediately made available by the Administrative Agent to the Swingline
Lender for application by the Swingline Lender to the repayment of the Refunded
Swingline Loans. The Borrower irrevocably authorizes the Swingline Lender to
charge the Borrower's accounts with the Administrative Agent (up to the amount
available in each such account) in order to immediately pay the amount of such
Refunded Swingline Loans to the extent amounts received from the Lenders are not
sufficient to repay in full such Refunded Swingline Loans if such deficiency is
not otherwise reimbursed by the Borrower on the Business Day following a written
request for such reimbursement to the Borrower by the Swingline Lender.

         (c) If prior to the time a Revolving Credit Loan would have otherwise
been made pursuant to subsection 2.4(b), one of the events described in
subsection 10(e) shall have occurred and be continuing with respect to the
Borrower or if for any other reason, as determined by the

                                       23
<PAGE>

Swingline Lender in its sole discretion, Revolving Credit Loans may not be made
as contemplated by subsection 2.4(b), each Lender shall, on the date such
Revolving Credit Loan was to have been made pursuant to the notice referred to
in subsection 2.4(b) (the "Refunding Date"), purchase for cash an undivided
participating interest in the then outstanding Swingline Loans by paying to the
Swingline Lender an amount (the "Swingline Participation Amount") equal to (i)
such Lender's Revolving Credit Commitment Percentage times (ii) the sum of the
aggregate principal amount of Swingline Loans then outstanding that were to have
been repaid with such Revolving Loans.

         (d) Whenever, at any time after the Swingline Lender has received from
any Lender such Lender's Swingline Participation Amount, the Swingline Lender
receives any payment on account of the Swingline Loans, the Swingline Lender
will distribute to such Lender its Swingline Participation Amount (appropriately
adjusted, in the case of interest payments, to reflect the period of time during
which such Lender's participating interest was outstanding and funded and, in
the case of principal and interest payments, to reflect such Lender's pro rata
portion of such payment if such payment is not sufficient to pay the principal
of and interest on all Swingline Loans then due); provided, however, that in the
event that such payment received by the Swingline Lender is required to be
returned, such Lender will return to the Swingline Lender any portion thereof
previously distributed to it by the Swingline Lender.

         (e) Each Lender's obligation to make the Loans referred to in
subsection 2.4(b) and to purchase participating interests pursuant to subsection
2.4(c) shall be absolute and unconditional and shall not be affected by any
circumstance, including (i) any setoff, counterclaim, recoupment, defense or
other right that such Lender or the Borrower may have against the Swingline
Lender, the Borrower or any other Person for any reason whatsoever; (ii) the
occurrence or continuance of a Default or an Event of Default or the failure to
satisfy any of the other conditions specified in Section 7; (iii) any adverse
change in the condition (financial or otherwise) of the Borrower; (iv) any
breach of this Agreement or any other Loan Document by the Borrower or any other
Lender; or (v) any other circumstance, happening or event whatsoever, whether or
not similar to any of the foregoing.

         2.5 FACILITY FEE. The Borrower agrees to pay to the Administrative
Agent for the account of each Lender a facility fee for the period from and
including the Fee Commencement Date to the Termination Date computed at the
Facility Fee Rate on the average daily amount of the Revolving Credit Commitment
of such Lender (regardless of usage) during the period for which payment is
made, payable quarterly in arrears on the last day of each March, June,
September and December and on the Termination Date or such earlier date on which
the Revolving Credit Commitments shall terminate as provided herein, commencing
on the first of such dates to occur after the date hereof.

         2.6 TERMINATION OR REDUCTION OF COMMITMENTS. The Borrower shall have
the right, upon not less than five Business Days' notice to the Administrative
Agent, to terminate the Revolving Credit Commitments or, from time to time, to
reduce the amount of the Revolving Credit Commitments; provided that no such
termination or reduction shall be permitted if, after giving effect thereto and
to any prepayments of the Loans made on the effective date thereof, either (a)
the Aggregate Available Revolving Credit Commitments would not be greater than
or equal to zero or (b) the Available Revolving Credit Commitments of any Lender
would not be

                                       24
<PAGE>

greater than or equal to zero. Any such reduction shall be in an amount equal to
$5,000,000 or a whole multiple thereof and shall reduce permanently the
Revolving Credit Commitments then in effect. The Administrative Agent shall give
each Lender prompt notice of any notice received from the Borrower pursuant to
this subsection 2.6.

         2.7  REPAYMENT OF REVOLVING CREDIT LOANS. The Borrower hereby
unconditionally promises to pay to the Administrative Agent for the account of
each Lender the then unpaid principal amount of each Revolving Credit Loan of
such Lender on the Termination Date (or such earlier date on which the Revolving
Credit Loans become due and payable pursuant to Section 10). The Borrower hereby
further agrees to pay interest on the unpaid principal amount of the Revolving
Credit Loans from time to time outstanding from the date hereof until payment in
full thereof at the rates per annum, and on the dates, set forth in subsection
3.4.

         2.8  CAF ADVANCES. Subject to the terms and conditions of this
Agreement, the Borrower may borrow CAF Advances from time to time on any
Business Day during the CAF Advance Availability Period. LIBO Rate CAF Advance
may be denominated in Dollars or any other available and freely-convertible
eurocurrency acceptable to the bidding Lender, and Fixed Rate CAF Advances shall
be denominated in Dollars. CAF Advances may be borrowed in amounts such that the
amount of Aggregate Total Outstandings of all Lenders at any time shall not
exceed the Aggregate Revolving Credit Commitments at such time. Within the
limits and on the conditions hereinafter set forth with respect to CAF Advances,
the Borrower from time to time may borrow, repay and reborrow CAF Advances.

         2.9 PROCEDURE FOR CAF ADVANCE BORROWING. (a) The Borrower shall request
CAF Advances by delivering a CAF Advance Request to the Administrative Agent,
not later than 12:00 Noon (New York City time) four Business Days prior to the
proposed Borrowing Date (in the case of a LIBO Rate CAF Advance Request), and
not later than 10:00 A.M. (New York City time) one Business Day prior to the
proposed Borrowing Date (in the case of a Fixed Rate CAF Advance Request). Each
CAF Advance Request in respect of any Borrowing Date may solicit bids for CAF
Advances on such Borrowing Date in an aggregate principal amount of $5,000,000
or an integral multiple of $1,000,000 in excess thereof (or, in the case of CAF
Advances to be denominated in a currency other than Dollars, and amount in such
currency the Dollar Equivalent of which is equal to $5,000,000 or $1,000,000, as
the case may be) and having not more than three alternative CAF Advance Maturity
Dates. The CAF Advance Maturity Date for each CAF Advance shall be the date set
forth therefor in the relevant CAF Advance Request, which date shall be (i) not
less than 7 days nor more than 360 days after the Borrowing Date therefor, in
the case of a Fixed Rate CAF Advance, (ii) not less than one month nor more than
twelve months after the Borrowing Date therefor, in the case of a LIBO CAF
Advance and (iii) not later than the Termination Date, in the case of any CAF
Advance. The Administrative Agent shall notify each Lender promptly by facsimile
transmission of the contents of each CAF Advance Request received by the
Administrative Agent.

         (b) In the case of a LIBO Rate CAF Advance Request, upon receipt of
notice from the Administrative Agent of the contents of such CAF Advance
Request, each Lender may elect, in its sole discretion, to offer irrevocably to
make one or more CAF Advances at the applicable Eurocurrency Rate plus (or
minus) a margin determined by such Lender in its sole discretion for each such
CAF Advance. Any such irrevocable offer shall be made by delivering a CAF

                                       25
<PAGE>

Advance Offer to the Administrative Agent, before 10:30 A.M. (New York City
time) on the day that is three Business Days before the proposed Borrowing Date,
setting forth:

                  (i) the maximum amount of CAF Advances for each CAF Advance
         Maturity Date and the aggregate maximum amount of CAF Advances for all
         CAF Advance Maturity Dates which such Lender would be willing to make
         (which amounts may, subject to subsection 2.8, exceed such Lender's
         Revolving Credit Commitment); and

                  (ii) the margin above or below the applicable Eurocurrency
         Rate at which such Lender is willing to make each such CAF Advance.

The Administrative Agent shall advise the Borrower before 11:00 A.M. (New York
City time) on the date which is three Business Days before the proposed
Borrowing Date of the contents of each such CAF Advance Offer received by it. If
the Administrative Agent, in its capacity as a Lender, shall elect, in its sole
discretion, to make any such CAF Advance Offer, it shall advise the Borrower of
the contents of its CAF Advance Offer before 10:15 A.M. (New York City time) on
the date which is three Business Days before the proposed Borrowing Date.

         (c) In the case of a Fixed Rate CAF Advance Request, upon receipt of
notice from the Administrative Agent of the contents of such CAF Advance
Request, each Lender may elect, in its sole discretion, to offer irrevocably to
make one or more CAF Advances at a rate of interest determined by such Lender in
its sole discretion for each such CAF Advance. Any such irrevocable offer shall
be made by delivering a CAF Advance Offer to the Administrative Agent before
9:30 A.M. (New York City time) on the Borrowing Date, setting forth:

                  (i) the maximum amount of CAF Advances for each CAF Advance
         Maturity Date, and the aggregate maximum amount for all CAF Advance
         Maturity Dates, which such Lender would be willing to make (which
         amounts may, subject to subsection 2.8, exceed such Lender's Revolving
         Credit Commitment); and

                  (ii) the rate of interest at which such Lender is willing to
         make each such CAF Advance.

The Administrative Agent shall advise the Borrower before 10:00 A.M. (New York
City time) on the proposed Borrowing Date of the contents of each such CAF
Advance Offer received by it. If the Administrative Agent, in its capacity as a
Lender, shall elect, in its sole discretion, to make any such CAF Advance Offer,
it shall advise the Borrower of the contents of its CAF Advance Offer before
9:15 A.M. (New York City time) on the proposed Borrowing Date.

         (d) Before 11:30 A.M. (New York City time) three Business Days before
the proposed Borrowing Date (in the case of CAF Advances requested by a LIBO
Rate CAF Advance Request) and before 10:30 A.M. (New York City time) on the
proposed Borrowing Date (in the case of CAF Advances requested by a Fixed Rate
CAF Advance Request), the Borrower, in its absolute discretion, shall:

                  (i) cancel such CAF Advance Request by giving the
         Administrative Agent telephone notice to that effect, or

                                       26
<PAGE>

                  (ii) by giving telephone notice to the Administrative Agent
         (immediately confirmed by delivery to the Administrative Agent of a CAF
         Advance Confirmation by facsimile transmission) (A) subject to the
         provisions of subsection 2.9(e), accept one or more of the offers made
         by any Lender or Lenders pursuant to subsection 2.9(b) or subsection
         2.9(c), as the case may be, and (B) reject any remaining offers made by
         Lenders pursuant to subsection 2.9(b) or subsection 2.9(c), as the case
         may be.

         (e) The Borrower's acceptance of CAF Advances in response to any CAF
Advance Offers shall be subject to the following limitations:

                  (i) the amount of CAF Advances accepted for each CAF Advance
         Maturity Date specified by any Lender in its CAF Advance Offer shall
         not exceed the maximum amount for such CAF Advance Maturity Date
         specified in such CAF Advance Offer;

                  (ii) the aggregate amount of CAF Advances accepted for all CAF
         Advance Maturity Dates specified by any Lender in its CAF Advance Offer
         shall not exceed the aggregate maximum amount specified in such CAF
         Advance Offer for all such CAF Advance Maturity Dates;

                  (iii) the Borrower may not accept offers for CAF Advances for
         any CAF Advance Maturity Date in an aggregate principal amount in
         excess of the maximum principal amount requested in the related CAF
         Advance Request; and

                  (iv) if the Borrower accepts any of such offers, it must
         accept offers based solely upon pricing for each relevant CAF Advance
         Maturity Date and upon no other criteria whatsoever, and if two or more
         Lenders submit offers for any CAF Advance Maturity Date at identical
         pricing and the Borrower accepts any of such offers but does not wish
         to (or, by reason of the limitations set forth in subsection 2.8,
         cannot) borrow the total amount offered by such Lenders with such
         identical pricing, the Borrower shall accept offers from all of such
         Lenders in amounts allocated among them pro rata according to the
         amounts offered by such Lenders (with appropriate rounding, in the sole
         discretion of the Borrower, to assure that each accepted CAF Advance is
         an integral multiple of $1,000,000 or, in the case of CAF Advances to
         be denominated in a currency other than Dollars, an amount in such
         currency the Dollar Equivalent of which is approximately equal to
         $1,000,000); provided that if the number of Lenders that submit offers
         for any CAF Advance Maturity Date at identical pricing is such that,
         after the Borrower accepts such offers pro rata in accordance with the
         foregoing provisions of this paragraph, the CAF Advance to be made by
         any such Lender would be less than $5,000,000 (or, in the case of CAF
         Advances to be denominated in a currency other than Dollars, an amount
         in such currency the Dollar Equivalent of which is approximately equal
         to $5,000,000) principal amount, the number of such Lenders shall be
         reduced by the Administrative Agent by lot until the CAF Advances to be
         made by each such remaining Lender would be in a principal amount of
         $5,000,000 or an integral multiple of $1,000,000 in excess thereof (or,
         in the case of CAF Advances to be denominated in a currency other than
         Dollars, an amount in such currency the Dollar Equivalent of which is
         approximately equal to $5,000,000 or an integral multiple of $1,000,000
         in excess thereof).

                                       27
<PAGE>

         (f) If the Borrower notifies the Administrative Agent that a CAF
Advance Request is cancelled pursuant to subsection 2.9(d)(i), the
Administrative Agent shall give prompt telephone notice thereof to the Lenders.

         (g) If the Borrower accepts pursuant to subsection 2.9(d)(ii) one or
more of the offers made by any Lender or Lenders, the Administrative Agent
promptly shall notify each Lender which has made such an offer of (i) the
aggregate amount of such CAF Advances to be made on such Borrowing Date for each
CAF Advance Maturity Date and (ii) the acceptance or rejection of any offers to
make such CAF Advances made by such Lender. Before 12:00 Noon (New York City
time) on the Borrowing Date specified in the applicable CAF Advance Request (in
the case of CAF Advances denominated in Dollars) and before the funding time for
the relevant currency from time to time specified by the Administrative Agent by
notice to the Lenders (in the case of CAF Advances denominated in any currency
other than Dollars), each Lender whose CAF Advance Offer has been accepted shall
make available to the Administrative Agent the amount of CAF Advances to be made
by such Lender, in immediately available funds, at the funding office for the
relevant currency specified from time to time by the Administrative Agent by
notice to the Lenders. The Administrative Agent will make such funds available
to the Borrower as soon as practicable on such date at such office of the
Administrative Agent. As soon as practicable after each Borrowing Date, the
Administrative Agent shall notify each Lender of the aggregate amount of CAF
Advances advanced on such Borrowing Date and the respective CAF Advance Maturity
Dates thereof.

         2.10 REPAYMENT OF CAF ADVANCES. The Borrower hereby unconditionally
promises to pay to the Administrative Agent, for the account of each Lender
which has made a CAF Advance, on the applicable CAF Advance Maturity Date the
then unpaid principal amount of such CAF Advance. The Borrower shall have the
right to prepay any principal amount of any CAF Advance only with the consent of
the Lender to which such CAF Advance is owed. The Borrower hereby further agrees
to pay interest on the unpaid principal amount of each CAF Advance from the
Borrowing Date to the applicable CAF Advance Maturity Date at the rate of
interest specified in the CAF Advance Offer accepted by the Borrower in
connection with such CAF Advance (calculated on the basis of a 360-day year for
actual days elapsed), payable on each applicable CAF Advance Interest Payment
Date.

         2.11 CERTAIN RESTRICTIONS WITH RESPECT TO CAF ADVANCES. A CAF Advance
Request may request offers for CAF Advances to be made on not more than one
Borrowing Date and to mature on not more than three CAF Advance Maturity Dates.
No CAF Advance Request may be submitted earlier than five Business Days after
submission of any other CAF Advance Request.

         2.12 MULTICURRENCY COMMITMENTS. Subject to the terms and conditions
hereof, each Multicurrency Lender severally agrees to make revolving credit
loans (each, a "Multicurrency Loan") in any Available Foreign Currency to the
Borrower from time to time during the Commitment Period so long as after giving
effect thereto (a) the Available Multicurrency Commitment of each Multicurrency
Lender is greater than or equal to zero, (b) the aggregate outstanding principal
amount of Multicurrency Loans, plus (i) the aggregate outstanding principal
amount of Local Currency Loans and (ii) the aggregate outstanding amount of L/C
Obligations attributable to Letters of Credit denominated in any currency other
than Dollars,

                                       28
<PAGE>

does not exceed an amount the Dollar Equivalent of which is $600,000,000 and (c)
the Aggregate Total Outstandings of all Lenders do not exceed the Aggregate
Revolving Credit Commitments. During the Commitment Period, the Borrower may use
the Multicurrency Commitments by borrowing, repaying the Multicurrency Loans in
whole or in part, and reborrowing, all in accordance with the terms and
conditions hereof. Any Multicurrency Lender may cause its Multicurrency Loans to
be made by any branch, affiliate or international banking facility of such
Multicurrency Lender, provided, that such Multicurrency Lender shall remain
responsible for all of its obligations hereunder and no additional taxes, costs
or other burdens shall be imposed upon the Borrower or the Administrative Agent
as a result thereof.

         2.13  REPAYMENT OF MULTICURRENCY LOANS. The Borrower hereby
unconditionally promises to pay to the Administrative Agent for the account of
each Multicurrency Lender the then unpaid principal amount of each Multicurrency
Loan of such Multicurrency Lender on the Termination Date and on such other
date(s) and in such other amounts as may be required from time to time pursuant
to this Agreement. The Borrower hereby further agrees to pay interest on the
unpaid principal amount of the Multicurrency Loans advanced to it and from time
to time outstanding until payment thereof in full at the rates per annum, and on
the dates, set forth in subsection 3.4.

         2.14  PROCEDURE FOR MULTICURRENCY BORROWING. The Borrower may request
the Multicurrency Lenders to make Multicurrency Loans during the Commitment
Period on any Business Day by delivering a Notice of Multicurrency Loan
Borrowing. Each borrowing under the Multicurrency Commitments shall be in an
amount in an Available Foreign Currency the Dollar Equivalent of which is equal
to at least $1,000,000 (or, if the then Aggregate Available Multicurrency
Commitments are less than $1,000,000, such lesser amount). Upon receipt of any
such Notice of Multicurrency Borrowing from the Borrower, the Administrative
Agent shall promptly notify each Multicurrency Lender thereof. Not later than
the funding time for the relevant Available Foreign Currency specified from time
to time by the Administrative Agent by notice to the Borrower and the
Multicurrency Lenders each Multicurrency Lender shall make an amount equal to
its Multicurrency Commitment Percentage of the principal amount of Multicurrency
Loans requested to be made on such Borrowing Date available to the
Administrative Agent at the funding office for the relevant Available Foreign
Currency specified from time to time by the Administrative Agent by notice to
the Borrower and the Multicurrency Lenders in the relevant Available Foreign
Currency and in immediately available funds. The amounts made available by each
Multicurrency Lender will then be made available to the Borrower at such funding
office and in like funds as received by the Administrative Agent.

         2.15  TERMINATION OR REDUCTION OF MULTICURRENCY COMMITMENTS. The
Borrower shall have the right, upon not less than three Business Days' notice to
the Administrative Agent (which shall give prompt notice thereof to each
Multicurrency Lender), to terminate the Multicurrency Commitments or, from time
to time, to reduce the amount of the Multicurrency Commitments; provided that no
such termination or reduction shall be permitted if, after giving effect thereto
and to any prepayments of the Loans made on the effective date thereof, the
Available Multicurrency Commitment of any Multicurrency Lender would be less
than zero. Any such reduction shall be in an amount equal to U.S. $1,000,000 or
a whole multiple of U.S. $100,000 in excess thereof and shall reduce permanently
the Multicurrency Commitments then in effect.

                                       29
<PAGE>

         2.16   BORROWINGS OF REVOLVING CREDIT LOANS AND REFUNDING OF LOANS. (a)
If on any Borrowing Date on which the Borrower has requested the Multicurrency
Lenders to make Multicurrency Loans (the "Requested Multicurrency Loans"),

                  (i) the aggregate principal amount of the Requested
         Multicurrency Loans exceeds the Aggregate Available Multicurrency
         Commitments on such Borrowing Date (before giving effect to the making
         and payment of any Loans required to be made pursuant to this
         subsection 2.16 on such Borrowing Date) and,

                  (ii) the Dollar Equivalent of the amount of such excess is
         less than or equal to the aggregate Available Revolving Credit
         Commitments of all Non-Multicurrency Lenders (before giving effect to
         the making and payment of any Loans pursuant to this subsection 2.16 on
         such Borrowing Date),

each Non-Multicurrency Lender shall make a Revolving Credit Loan to the Borrower
on such Borrowing Date, and the proceeds of such Revolving Credit Loans shall be
simultaneously applied to repay outstanding Revolving Credit Loans, Local
Currency Loans and/or Multicurrency Loans of the Multicurrency Lenders (as
directed by the Borrower) in each case in amounts such that, after giving effect
to (1) such borrowings and repayments and (2) the borrowing from the
Multicurrency Lenders of the Requested Multicurrency Loans, the Committed
Outstanding Percentage of each Lender will equal (as nearly as possible) its
Revolving Credit Commitment Percentage. To effect such borrowings and
repayments, (x) not later than 12:00 Noon, New York City time, on such Borrowing
Date, the proceeds of such Revolving Credit Loans shall be made available by
each Non-Multicurrency Lender to the Administrative Agent at its New York office
specified in subsection 13.2 in Dollars and in immediately available funds and
the Administrative Agent shall apply the proceeds of such Revolving Credit Loans
toward repayment of outstanding Revolving Credit Loans and/or Local Currency
Loans of the Multicurrency Lenders (as directed by the Borrower) and (y)
concurrently with the repayment of such Loans on such Borrowing Date, (I) the
Multicurrency Lenders shall, in accordance with the applicable provisions
hereof, make the Requested Multicurrency Loans in an aggregate amount equal to
the amount so requested by the Borrower (but not in any event greater than the
Aggregate Available Multicurrency Commitments after giving effect to the making
of such repayment of any Loans on such Borrowing Date) and (II) the Borrower
shall pay to the Administrative Agent for the account of the Lenders whose Loans
to the Borrower are repaid on such Borrowing Date pursuant to this subsection
2.16 all interest accrued on the amounts repaid to the date of repayment,
together with any amounts payable pursuant to subsection 3.11 in connection with
such repayment.

         (b) Subject to the limitations on borrowings contained in a given Local
Currency Facility, if on any Borrowing Date on which a Foreign Subsidiary
Borrower has requested Local Currency Lenders to make Local Currency Loans (the
"Requested Local Currency Loans") under a Local Currency Facility to which such
Foreign Subsidiary Borrower and Local Currency Lenders are parties, (i) the
aggregate principal amount of the Requested Local Currency Loans (A) exceeds the
aggregate available amount of the commitments of such Local Currency Lenders
under such Local Currency Facility on such Borrowing Date (before giving effect
to the making and payment of any Revolving Credit Loans required to be made
pursuant to this subsection 2.16 on such Borrowing Date) or (B) together with
the aggregate then outstanding principal amount of

                                       30
<PAGE>

Multicurrency Loans and the aggregate outstanding amount of L/C Obligations
attributable to Letters of Credit denominated in any currency other than
Dollars, would exceed an amount of which the Dollar Equivalent is $600,000,000,
(ii) after giving effect to the Requested Local Currency Loans, the Dollar
Equivalent of the aggregate outstanding principal amount of Local Currency Loans
of such Foreign Subsidiary Borrower will be less than or equal to the aggregate
commitments of such Local Currency Lenders under such Local Currency Facility
and (iii) the Dollar Equivalent of the amount of the excess described in clause
(i) above is less than or equal to the Aggregate Available Revolving Credit
Commitments of all Lenders other than such Local Currency Lenders (before giving
effect to the making and payment of any Revolving Credit Loans pursuant to this
subsection 2.16 on such Borrowing Date), each such other Lender shall make a
Revolving Credit Loan to the Borrower, on such Borrowing Date, and the proceeds
of such Revolving Credit Loans shall be simultaneously applied to repay
outstanding Revolving Credit Loans, Multicurrency Loans and/or Local Currency
Loans of such Local Currency Lenders (as directed by the Borrower) in each case
in amounts such that, after giving effect to (1) such borrowings and repayments
and (2) the borrowing from such Local Currency Lenders of the Requested Local
Currency Loans, the Committed Outstandings Percentage of each Lender will equal
(as nearly as possible) its Revolving Credit Commitment Percentage and the
Dollar Equivalent of the aggregate outstanding principal amount of Multicurrency
Loans and Local Currency Loans will not exceed $600,000,000. To effect such
borrowings and repayments, (x) not later than 12:00 Noon, New York City time, on
such Borrowing Date, the proceeds of such Revolving Credit Loans shall be made
available by each such other Lender to the Administrative Agent at its New York
office specified in subsection 13.2 in Dollars and in immediately available
funds and the Administrative Agent shall apply the proceeds of such Revolving
Credit Loans toward the repayment of outstanding Revolving Credit Loans,
Multicurrency Loans and/or Local Currency Loans of such Local Currency Lenders
(as directed by the Borrower) and (y) concurrently with the repayment of such
Revolving Credit Loans on such Borrowing Date, (I) such Local Currency Lenders
shall, in accordance with the applicable provisions hereof, make the Requested
Local Currency Loans in an aggregate amount equal to the amount so requested by
such Foreign Subsidiary Borrower and (II) the relevant Foreign Subsidiary
Borrower shall pay to the Administrative Agent for the account of the Lenders
whose Loans to such Borrower are repaid on such Borrowing Date pursuant to this
subsection 2.16 all interest accrued on the amounts repaid to the date of
repayment, together with any amounts payable pursuant to subsection 3.11 in
connection with such repayment.

         (c)  If any borrowing of Revolving Credit Loans is required pursuant to
this subsection 2.16, the Borrower shall notify the Administrative Agent in the
manner provided for Revolving Credit Loans in subsection 2.2, except that the
minimum borrowing amounts set forth in subsection 2.2 shall not be applicable to
the extent that such minimum borrowing amounts exceed the amounts of Revolving
Credit Loans required to be made pursuant to this subsection 2.16.

         2.17   [INTENTIONALLY OMITTED].

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<PAGE>

                                    SECTION 3
                               CERTAIN PROVISIONS
                             APPLICABLE TO THE LOANS

         3.1 OPTIONAL AND MANDATORY PREPAYMENTS. (a) The Borrower may at any
time and from time to time prepay the Revolving Credit Loans, in whole or in
part, without premium or penalty (other than any amounts payable pursuant to
subsection 3.11 if such prepayment is of Eurodollar Loans and is made on a day
other than the last day of the Interest Period with respect thereto), upon at
least four Business Days' irrevocable notice to the Administrative Agent,
specifying the date and amount of prepayment and whether the prepayment is of
Eurodollar Loans, ABR Loans or a combination thereof, and, if of a combination
thereof, the amount allocable to each. Upon receipt of any such notice the
Administrative Agent shall promptly notify each Lender thereof. If any such
notice is given, the amount specified in such notice shall be due and payable on
the date specified therein.

         (b) The Borrower may at any time and from time to time prepay, without
premium or penalty (other than any amounts payable pursuant to subsection 3.11
if such prepayment is of Multicurrency Loans and is made on a day other than the
last day of the Interest Period with respect thereto), the Multicurrency Loans,
in whole or in part, upon at least three Business Days' irrevocable notice to
the Administrative Agent specifying the date and amount of prepayment. Upon the
receipt of any such notice, the Administrative Agent shall promptly notify each
Multicurrency Lender thereof. If any such notice is given, the amount specified
in such notice shall be due and payable on the date specified therein. Partial
prepayments of Multicurrency Loans shall be in an aggregate principal amount the
Dollar Equivalent of which is at least $1,000,000 or an integral multiple of
$100,000 in excess thereof.

         (c) (i) If, at any time during the Commitment Period, for any reason
the Aggregate Total Outstandings of all Lenders exceed the Aggregate Revolving
Credit Commitments then in effect, the Borrower shall, without notice or demand,
immediately prepay the Revolving Credit Loans and/or the Multicurrency Loans in
amounts such that the sum of (A) the aggregate principal amount of the Revolving
Credit Loans so prepaid and (B) the Dollar Equivalent of the aggregate principal
amount of the Multicurrency Loans so prepaid, equals or exceeds the amount of
such excess.

                  (ii) If, at any time during the Commitment Period, for any
         reason either (1) the Aggregate Total Outstandings of all Multicurrency
         Lenders exceed the Aggregate Revolving Credit Commitments of the
         Multicurrency Lenders, (2) the Aggregate Multicurrency Outstandings
         exceed the aggregate Multicurrency Commitments, (3) the sum of the
         Aggregate Multicurrency Outstandings plus the Dollar Equivalent of (x)
         the aggregate outstanding principal amount of Local Currency Loans and
         (y) the aggregate outstanding amount of L/C Obligations attributable to
         Letters of Credit denominated in currencies other than Dollars, exceeds
         the aggregate Multicurrency Commitments or (4) the Dollar Equivalent of
         all L/C Obligations attributable to Letters of Credit denominated in
         currencies other than Dollars exceeds, in the aggregate, $600,000,000,
         the Borrower shall, without notice or demand, immediately prepay the
         Revolving Credit Loans and/or the Multicurrency Loans and/or Local
         Currency Loans and/or cash collateralize the L/C Obligations in amounts
         such that any such excess is eliminated.

                                       32
<PAGE>

                  (iii) Each prepayment of Loans pursuant to this subsection
         3.1(c) shall be accompanied by any amounts payable under subsection
         3.11 in connection with such prepayment.

                  (iv) Notwithstanding the foregoing, mandatory prepayments of
         Revolving Credit Loans or Multicurrency Loans that would otherwise be
         required pursuant to this subsection 3.1(c) solely as a result of
         fluctuations in Exchange Rates from time to time shall only be required
         to be made pursuant to this subsection 3.1(c) on the last Business Day
         of each month on the basis of the Exchange Rate in effect on such
         Business Day.

         (d)   [Intentionally omitted].

         3.2   CONVERSION AND CONTINUATION OPTIONS. (a) The Borrower may elect
from time to time to convert Eurodollar Loans to ABR Loans by giving the
Administrative Agent at least two Business Days' prior irrevocable notice of
such election. The Borrower may elect from time to time to convert ABR Loans to
Eurodollar Loans by giving the Administrative Agent at least three Business
Days' prior irrevocable notice of such election. Any such notice of conversion
to Eurodollar Loans shall specify the length of the initial Interest Period
therefor. Upon receipt of any such notice the Administrative Agent shall
promptly notify each Lender thereof. All or any part of outstanding Eurodollar
Loans and ABR Loans may be converted as provided herein, provided that (i) no
Loan may be converted into a Eurodollar Loan when any Event of Default has
occurred and is continuing and the Administrative Agent has or the Majority
Lenders have determined that such a conversion is not appropriate and (ii) no
Loan may be converted into a Eurodollar Loan after the date that is one month
prior to the Termination Date.

         (b) Any Eurodollar Loans may be continued as such upon the expiration
of the then current Interest Period with respect thereto by the Borrower giving
notice to the Administrative Agent, in accordance with the applicable provisions
of the term "Interest Period" set forth in subsection 1.1, of the length of the
next Interest Period to be applicable to such Loans, provided that no Eurodollar
Loan may be continued as such (i) when any Event of Default has occurred and is
continuing and the Administrative Agent has or the Majority Lenders have
determined that such a continuation is not appropriate or (ii) after the date
that is one month prior to the Termination Date, and provided, further, that if
the Borrower shall fail to give such notice or if such continuation is not
permitted, such Loans shall be automatically converted to ABR Loans on the last
day of such then expiring Interest Period.

         (c) Any Multicurrency Loans may be continued as such upon the
expiration of the then current Interest Period with respect thereto by the
Borrower giving a Notice of Multicurrency Loan Continuation, provided, that if
the Borrower shall fail to give such Notice of Multicurrency Loan Continuation
by the deadline specified therefor in Schedule II, such Multicurrency Loans
shall automatically be continued for an Interest Period of one month.

         3.3 MINIMUM AMOUNTS AND MAXIMUM NUMBER OF TRANCHES. All borrowings,
conversions and continuations of Revolving Credit Loans and Multicurrency Loans
hereunder and all selections of Interest Periods hereunder shall be in such
amounts and be made pursuant to such elections so that, after giving effect
thereto, (i) the aggregate principal amount of the Eurodollar Loans comprising
each Eurodollar Tranche shall be equal to $5,000,000 or a whole

                                       33
<PAGE>

multiple of $1,000,000 in excess thereof and (ii) the aggregate principal amount
of the Multicurrency Loans comprising each Multicurrency Tranche shall be in an
amount the Dollar Equivalent of which is at least $5,000,000. In no event shall
there be more than seven Tranches outstanding at any time.

         3.4 INTEREST RATES AND PAYMENT DATES. (a) Each Eurodollar Loan shall
bear interest for each day during each Interest Period with respect thereto at a
rate per annum equal to the Eurocurrency Rate determined for such Interest
Period plus the Applicable Margin in effect for such day.

         (b) Each ABR Loan shall bear interest at a rate per annum equal to the
ABR plus the Applicable Margin.

         (c) Each Multicurrency Loan shall bear interest for each day that it is
outstanding at a rate per annum equal to the Eurocurrency Rate plus the
Applicable Margin in effect for such day.

         (d) Each CAF Advance shall bear interest at the rate determined in
accordance with subsection 2.9.

         (e) If all or a portion of (i) any principal of any Loan, (ii) any
interest payable thereon, (iii) any facility fee or (iv) any other amount
payable hereunder shall not be paid when due (whether at the stated maturity, by
acceleration or otherwise), the principal of the Loans and/or any such overdue
interest, commitment fee or other amount shall bear interest at a rate per annum
which is (x) in the case of principal, the rate that would otherwise be
applicable thereto pursuant to the foregoing provisions of this subsection plus
2% or (y) in the case of any such overdue interest, facility fee or other
amount, the rate described in paragraph (b) of this subsection plus 2%, in each
case from the date of such non-payment until such overdue principal, interest,
facility fee or other amount is paid in full (as well after as before judgment).

         (f) Interest pursuant to this subsection shall be payable in arrears on
each Interest Payment Date or CAF Advance Interest Payment Date, as the case may
be, provided that interest accruing pursuant to paragraph (e) of this subsection
shall be payable from time to time on demand.

         3.5 COMPUTATION OF INTEREST AND FEES. (a) Whenever it is calculated on
the basis of the Prime Rate, interest shall be calculated on the basis of a 365-
(or 366-, as the case may be) day year for the actual days elapsed; and,
otherwise, interest and fees shall be calculated on the basis of a 360-day year
for the actual days elapsed. The Administrative Agent shall as soon as
practicable notify the Borrower and the Lenders of each determination of a
Eurocurrency Rate. Any change in the interest rate on a Loan resulting from a
change in the ABR, the Eurocurrency Reserve Requirements, the C/D Assessment
Rate or the C/D Reserve Percentage shall become effective as of the opening of
business on the day on which such change becomes effective. The Administrative
Agent shall as soon as practicable notify the Borrower and the Lenders of the
effective date and the amount of each such change in interest rate.

         (b) Each determination of an interest rate by the Administrative Agent
pursuant to any provision of this Agreement shall be conclusive and binding on
the Borrower and the

                                       34
<PAGE>

Lenders in the absence of manifest error. The Administrative Agent shall, at the
request of the Borrower, deliver to the Borrower a statement showing the
quotations used by the Administrative Agent in determining any interest rate
pursuant to subsections 3.4(a), (b) or (d).

         (c) If any Reference Lender shall for any reason no longer have a
Commitment or any Loans, such Reference Lender shall thereupon cease to be a
Reference Lender, and if, as a result, there shall only be one Reference Lender
remaining, the Administrative Agent (after consultation with the Lenders and
with the consent of the Borrower (which consent shall not be unreasonably
withheld)) shall, by notice to the Borrower and the Lenders, designate another
Lender as a Reference Lender so that there shall at all times be at least two
Reference Lenders.

         (d) Each Reference Lender shall use its best efforts to furnish
quotations of rates to the Administrative Agent as contemplated hereby. If any
of the Reference Lenders shall be unable or shall otherwise fail to supply such
rates to the Administrative Agent upon its request, the rate of interest shall,
subject to the provisions of subsection 3.6, be determined on the basis of the
quotations of the remaining Reference Lenders or Reference Lender.

         3.6  INABILITY TO DETERMINE INTEREST RATE. If prior to the first day of
any Interest Period:

         (a) the Administrative Agent shall have determined (which determination
shall be conclusive and binding upon the Borrower) that, by reason of
circumstances affecting the relevant market, adequate and reasonable means do
not exist for ascertaining the Eurocurrency Rate for such Interest Period, or

         (b) the Administrative Agent shall have received notice from the
Majority Lenders or the Majority Multicurrency Lenders, as the case may be, that
the Eurocurrency Rate determined or to be determined for such Interest Period
will not adequately and fairly reflect the cost to such Lenders (as conclusively
certified by such Lenders) of making or maintaining their affected Loans during
such Interest Period, the Administrative Agent shall give telecopy or telephonic
notice thereof to the Borrower and the Lenders as soon as practicable
thereafter. If such notice is given (w) any Eurodollar Loans or Multicurrency
Loans, as the case may be, requested to be made on the first day of such
Interest Period shall be made as ABR Loans, provided, that, notwithstanding the
provisions of subsection 2.2 or 2.14, the Borrower may cancel the request for
such Eurodollar Loan or Multicurrency Loan, as the case may be, by written
notice to the Administrative Agent one Business Day prior to the first day of
such Interest Period and the Borrower shall not be subject to any liability
pursuant to subsection 3.11 with respect to such cancelled request, (x) any
Loans that were to have been converted on the first day of such Interest Period
to Eurodollar Loans shall be continued as ABR Loans, (y) any outstanding
Eurodollar Loans shall be converted, on the first day of such Interest Period,
to ABR Loans and (z) any Multicurrency Loans to which such Interest Period
relates shall be repaid on the first day of such Interest Period. Until such
notice has been withdrawn by the Administrative Agent, no further Eurodollar
Loans or Multicurrency Loans shall be made or continued as such, nor shall the
Borrower have the right to convert ABR Loans to Eurodollar Loans.

         3.7 PRO RATA TREATMENT AND PAYMENTS. (a) Except as provided in
subsection 2.16 and in the immediately succeeding sentence of this paragraph,
each payment of principal or

                                       35
<PAGE>

interest in respect of the Loans shall be made pro rata according to the amounts
then due and owing to the respective Lenders. Each payment of principal and
interest in respect of any optional prepayment of Revolving Credit Loans or
Multicurrency Loans shall be made pro rata according to the amounts then due and
owing the respective Revolving Lender or Multicurrency Lender, as the case may
be.

         (b) Except as provided in subsection 2.16, each borrowing by the
Borrower of Revolving Credit Loans from the Lenders hereunder shall be made pro
rata according to the Funding Commitment Percentages of the Lenders in effect on
the date of such borrowing. Each payment by the Borrower on account of any
facility fee hereunder and any reduction of the Revolving Credit Commitments of
the Lenders shall be allocated by the Administrative Agent among the Lenders pro
rata according to the Revolving Credit Commitment Percentages of the Lenders.
Except as provided in subsection 2.16, each payment (including each prepayment)
by the Borrower on account of principal of and interest on the Revolving Credit
Loans shall be made pro rata according to the respective outstanding principal
amounts of the Revolving Credit Loans then due and owing to the Lenders. All
payments (including prepayments) to be made by the Borrower hereunder in respect
of amounts denominated in Dollars, whether on account of principal, interest,
fees or otherwise, shall be made without set off or counterclaim and shall be
made prior to 12:00 Noon, New York City time, on the due date thereof to the
Administrative Agent, for the account of the Lenders, at the Administrative
Agent's office specified in subsection 13.2, in Dollars and in immediately
available funds. The Administrative Agent shall distribute such payments to the
Lenders promptly upon receipt in like funds as received. If any payment
hereunder (other than payments on the Eurodollar Loans or Multicurrency Loans)
becomes due and payable on a day other than a Business Day, such payment shall
be extended to the next succeeding Business Day, and, with respect to payments
of principal, interest thereon shall be payable at the then applicable rate
during such extension. If any payment on a Eurodollar Loan or a Multicurrency
Loan becomes due and payable on a day other than a Business Day, the maturity of
such payment shall be extended to the next succeeding Business Day (and, with
respect to payments of principal, interest thereon shall be payable at the then
applicable rate during such extension) unless the result of such extension would
be to extend such payment into another calendar month, in which event such
payment shall be made on the immediately preceding Business Day.

         (c) Each borrowing of Multicurrency Loans by the Borrower shall be
made, and any reduction of the Multicurrency Commitments shall be allocated by
the Administrative Agent, pro rata according to the Multicurrency Commitment
Percentages of the Multicurrency Lenders. Each payment (including each
prepayment) by the Borrower on account of principal of and interest on
Multicurrency Loans shall be allocated by the Administrative Agent pro rata
according to the respective principal amounts of the Multicurrency Loans then
due and owing by the Borrower to each Multicurrency Lender. All payments
(including prepayments) to be made by the Borrower on account of Multicurrency
Loans hereunder, whether on account of principal, interest, fees or otherwise,
shall be made without set-off or counterclaim and shall be made at or before the
payment time for the currency of such Multicurrency Loan from time to time
specified by the Administrative Agent by notice to the Multicurrency Lenders and
the Borrower, on the due date thereof to the Administrative Agent, for the
account of the Multicurrency Lenders, at the payment office for the currency of
such Multicurrency Loan from time to time specified by the Administrative Agent
by notice to the Multicurrency Lenders and the Borrower, in the

                                       36
<PAGE>

currency of such Multicurrency Loan and in immediately available funds. The
Administrative Agent shall distribute such payments to the Multicurrency Lenders
entitled to receive the same promptly upon receipt in like funds as received.

         (d) Unless the Administrative Agent shall have been notified in writing
by any Lender prior to a borrowing that such Lender will not make the amount
that would constitute its share of such borrowing available to the
Administrative Agent, the Administrative Agent may assume that such Lender is
making such amount available to the Administrative Agent, and the Administrative
Agent may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. If such amount is not made available to the Administrative
Agent by the required time on the Borrowing Date therefor, such Lender shall pay
to the Administrative Agent, on demand, such amount with interest thereon at a
rate equal to (i) the daily average Federal Funds Effective Rate (in the case of
a borrowing of Revolving Credit Loans or CAF Advances denominated in Dollars)
and (ii) the Administrative Agent's reasonable estimate of its average daily
cost of funds (in the case of a borrowing of Multicurrency Loans or CAF Advances
denominated in a currency other than Dollars), in each case for the period until
such Lender makes such amount immediately available to the Administrative Agent.
A certificate of the Administrative Agent submitted to any Lender with respect
to any amounts owing under this subsection shall be conclusive in the absence of
manifest error. If such Lender's share of such borrowing is not made available
to the Administrative Agent by such Lender within three Business Days of such
Borrowing Date, the Administrative Agent shall also be entitled to recover such
amount with interest thereon equal to (i) the rate per annum applicable to ABR
Loans hereunder (in the case of a borrowing of Revolving Credit Loans or CAF
Advances or CAF Advances denominated in Dollars) and (ii) the Administrative
Agent's reasonable estimate of its average daily cost of funds plus the
Applicable Margin applicable to Multicurrency Loans (in the case of a borrowing
of Multicurrency Loans or CAF Advances denominated in a currency other than
Dollars), on demand, from the Borrower.

         3.8 ILLEGALITY. Notwithstanding any other provision herein, if after
the date hereof the adoption of or any change in any Requirement of Law or in
the interpretation or application thereof shall make it unlawful for any Lender
to make or maintain Eurodollar Loans or Multicurrency Loans as contemplated by
this Agreement, (a) the commitment of such Lender hereunder to make Eurodollar
Loans or Multicurrency Loans, continue Eurodollar Loans or Multicurrency Loans
as such and convert ABR Loans to Eurodollar Loans shall forthwith be cancelled,
(b) such Lender's Loans then outstanding as Eurodollar Loans, if any, shall be
converted automatically to ABR Loans on the respective last days of the then
current Interest Periods with respect to such Loans or within such earlier
period as required by law and (c) such Lender's Multicurrency Loans shall be
prepaid on the last day of the then current Interest Period with respect
thereto. If any such conversion of a Eurodollar Loan occurs on a day which is
not the last day of the then current Interest Period with respect thereto, the
Borrower shall pay to such Lender such amounts, if any, as may be required
pursuant to subsection 3.11.

         3.9 REQUIREMENTS OF LAW. (a) If the adoption of or any change in any
Requirement of Law or in the interpretation or application thereof or compliance
by any Lender with any request or directive (whether or not having the force of
law) from any central bank or other Governmental Authority made subsequent to
the date hereof (or, in the case of LIBO Rate CAF Advances, made subsequent to
acceptance by the Borrower of such LIBO Rate CAF Advance):

                                       37
<PAGE>

                  (i) shall subject any Lender to any tax of any kind whatsoever
         with respect to this Agreement, any Note, any Letter of Credit, any
         Application, any Eurodollar Loan, Multicurrency Loan or LIBO Rate CAF
         Advance made by it, or change the basis of taxation of payments to such
         Lender in respect thereof (except for Non-Excluded Taxes covered by
         subsection 3.10 and changes in the rate of tax on the overall net
         income of such Lender);

                  (ii) shall impose, modify or hold applicable any reserve,
         special deposit, compulsory loan or similar requirement against assets
         held by, deposits or other liabilities in or for the account of,
         advances, loans or other extensions of credit by, or any other
         acquisition of funds by, any office of such Lender which is not
         otherwise included in the determination of the Eurocurrency Rate; or

                  (iii) shall impose on such Lender any other condition;

and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans, Multicurrency Loans, LIBO Rate CAF
Advances or issuing or participating in Letters of Credit or to reduce any
amount receivable hereunder in respect thereof, then, in any such case, the
Borrower shall promptly pay such Lender such additional amount or amounts as
will compensate such Lender for such increased cost or reduced amount
receivable; provided, that the Borrower shall not be required to pay to any
Lender any amounts under this paragraph for any period prior to the date on
which such Lender gives notice to the Borrower that such amounts are payable
unless such Lender gives such notice within 180 days after it became aware or
should have become aware of the event giving rise to such payment obligation.

         (b) If any Lender shall have determined that after the date hereof the
adoption of or any change in any Requirement of Law regarding capital adequacy
or in the interpretation or application thereof or compliance by such Lender or
any corporation controlling such Lender with any request or directive regarding
capital adequacy (whether or not having the force of law) from any Governmental
Authority made subsequent to the date hereof shall have the effect of reducing
the rate of return on such Lender's or such corporation's capital as a
consequence of its obligations hereunder or under any Letter of Credit to a
level below that which such Lender or such corporation could have achieved but
for such adoption, change or compliance (taking into consideration such Lender's
or such corporation's policies with respect to capital adequacy) by an amount
deemed by such Lender to be material, then from time to time, the Borrower shall
promptly pay to such Lender such additional amount or amounts as will compensate
such Lender for such reduction; provided, that the Borrower shall not be
required to pay to any Lender any amounts under this paragraph for any period
prior to the date on which such Lender gives notice to the Borrower that such
amounts are payable unless such Lender gives such notice within 180 days after
it became aware or should have become aware of the event giving rise to such
payment obligation.

         (c) If any Lender becomes entitled to claim any additional amounts
pursuant to this subsection, it shall promptly notify the Borrower (with a copy

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<PAGE>

to the Administrative Agent) of the event by reason of which it has become so
entitled. A certificate as to any additional amounts payable pursuant to this
subsection submitted by such Lender to the Borrower (with a copy to the
Administrative Agent) shall be conclusive in the absence of manifest error. The
agreements in this subsection shall survive the termination of this Agreement
and the payment of the Loans and all other amounts payable hereunder.

         3.10 TAXES. (a) All payments made by the Borrower under any Loan
Document shall be made free and clear of, and without deduction or withholding
for or on account of, any present or future income, stamp or other taxes,
levies, imposts, duties, charges, fees, deductions or withholdings, now or
hereafter imposed, levied, collected, withheld or assessed by any Governmental
Authority, excluding net income taxes and franchise taxes (imposed in lieu of
net income taxes) imposed on the Administrative Agent or any Lender as a result
of a present or former connection between the Administrative Agent or such
Lender and the jurisdiction of the Governmental Authority imposing such tax or
any political subdivision or taxing authority thereof or therein (other than any
such connection arising solely from the Administrative Agent or such Lender
having executed, delivered or performed its obligations or received a payment
under, or enforced, any Loan Document). If any such non-excluded taxes, levies,
imposts, duties, charges, fees, deductions or withholdings ("Non-Excluded
Taxes") are required to be withheld from any amounts payable to the
Administrative Agent or any Lender hereunder or under any Loan Document, the
amounts so payable to the Administrative Agent or such Lender shall be increased
to the extent necessary to yield to the Administrative Agent or such Lender
(after payment of all Non-Excluded Taxes) interest or any such other amounts
payable hereunder at the rates or in the amounts specified in such Loan
Document; provided, however, that the Borrower shall not be required to increase
any such amounts payable to any Lender that is not organized under the laws of
the United States of America or a state thereof if such Lender fails to comply
with the requirements of paragraph (b) of this subsection. Whenever any
Non-Excluded Taxes are payable by the Borrower, as promptly as possible
thereafter the Borrower shall send to the Administrative Agent for its own
account or for the account of such Lender, as the case may be, a certified copy
of an original official receipt received by the Borrower showing payment
thereof. If the Borrower fails to pay any Non-Excluded Taxes when due to the
appropriate taxing authority or fails to remit to the Administrative Agent the
required receipts or other required documentary evidence, the Borrower shall
indemnify the Administrative Agent and the Lenders for any incremental taxes,
interest or penalties that may become payable by the Administrative Agent or any
Lender as a result of any such failure. The agreements in this subsection shall
survive the termination of this Agreement and each other Loan Document and the
payment of the Loans and all other amounts payable hereunder and thereunder.

         (b) Each Lender (or Transferee) that is not a citizen or resident of
the United States of America, a corporation, partnership or other entity created
or organized in or under the laws of the United States of America (or any
jurisdiction thereof), or any estate or trust that is subject to federal income
taxation regardless of the source of its income (a "Non-U. S. Lender") shall
deliver to the Borrower and the Administrative Agent (or, in the case of a
Participant, to the Lender from which the related participation shall have been
purchased) two copies of either U.S. Internal Revenue Service Form W-8BEN or
Form W-8ECI, or, in the case of a Non-U. S. Lender claiming exemption from U.S.
federal withholding tax under Section 871(h) or 881(c) of the Code with respect
to payments of "portfolio interest" a statement substantially in the form of
Exhibit J and a Form W-8BEN, or any subsequent versions thereof or successors
thereto properly completed and duly executed by such Non-U. S. Lender claiming
complete exemption from, or a reduced rate of, U.S. federal withholding tax on
all payments by the Borrower under

                                       39
<PAGE>

this Agreement and the other Loan Documents. Such forms shall be delivered by
each Non-U. S. Lender on or before the date it becomes a party to any Loan
Document (or, in the case of any Participant, on or before the date such
Participant purchases the related participation). In addition, each Non-U. S.
Lender shall deliver such forms promptly upon the obsolescence or invalidity of
any form previously delivered by such Non-U. S. Lender. Each Non-U. S. Lender
shall promptly notify the Borrower at any time it determines that it is no
longer in a position to provide any previously delivered certificate to the
Borrower (or any other form of certification adopted by the U.S. taxing
authorities for such purpose). Notwithstanding any other provision of this
paragraph, a Non-U. S. Lender shall not be required to deliver any form pursuant
to this paragraph that such Non-U. S. Lender is not legally able to deliver.

         (c) A Lender that is entitled to an exemption from or reduction of
non-U. S. withholding tax under the law of the jurisdiction in which the
Borrower is located, or any treaty to which such jurisdiction is a party, with
respect to payments under this Agreement shall deliver to the Borrower (with a
copy to the Administrative Agent), at the time or times prescribed by applicable
law or reasonably requested by the Borrower, such properly completed and
executed documentation prescribed by applicable law as will permit such payments
to be made without withholding or at a reduced rate, provided that such Lender
is legally entitled to complete, execute and deliver such documentation and in
such Lender's reasonable judgment such completion, execution or submission would
not materially prejudice the legal position of such Lender.

         3.11 INDEMNITY. The Borrower agrees to indemnify each Lender and to
hold each Lender harmless from any loss or expense which such Lender may sustain
or incur as a consequence of (a) default by the Borrower in making a borrowing
of, conversion into or continuation of Eurodollar Loans, Local Currency Loans,
Multicurrency Loans or CAF Advances after the Borrower has given a notice
requesting the same in accordance with the provisions of this Agreement, (b)
default by the Borrower or any Foreign Subsidiary Borrower in making any
prepayment after the Borrower or such Foreign Subsidiary Borrower has given a
notice thereof in accordance with the provisions of this Agreement or any other
Loan Document or (c) the making of a prepayment of Eurodollar Loans, Local
Currency Loans, Multicurrency Loans or CAF Advances or the conversion of
Eurodollar Loans to ABR Loans on a day which is not the last day of an Interest
Period with respect thereto. Such indemnification may include an amount equal to
the excess, if any, of (i) the amount of interest which would have accrued on
the amount so prepaid, or not so borrowed, converted or continued, for the
period from the date of such prepayment or of such failure to borrow, convert or
continue to the last day of such Interest Period (or, in the case of a failure
to borrow, convert or continue, the Interest Period that would have commenced on
the date of such failure) or, in the case of CAF Advances, the applicable CAF
Advance Maturity Date (or proposed CAF Advance Maturity Date), in each case at
the applicable rate of interest for such Loans provided for herein (excluding,
however, the Applicable Margin or any positive margin applicable to CAF Advances
included therein, if any) over (ii) the amount of interest (as reasonably
determined by such Lender) which would have accrued to such Lender on such
amount by placing such amount on deposit for a comparable period with leading
banks in the interbank eurodollar market. This covenant shall survive the
termination of this Agreement and each other Loan Document and the payment of
the Loans and all other amounts payable hereunder and thereunder.

                                       40
<PAGE>

         3.12 CHANGE OF LENDING OFFICE; REMOVAL OF LENDER. Each Lender agrees
that if it makes any demand for payment under subsection 3.9 or 3.10(a), or if
any adoption or change of the type described in subsection 3.8 shall occur with
respect to it, (i) it will use reasonable efforts (consistent with its internal
policy and legal and regulatory restrictions and so long as such efforts would
not be disadvantageous to it, as determined in its sole discretion) to designate
a different lending office if the making of such a designation would reduce or
obviate the need for the Borrower to make payments under subsection 3.9 or
3.10(a), or would eliminate or reduce the effect of any adoption or change
described in subsection 3.8 or (ii) it will, upon at least five Business Days'
notice from the Borrower to such Lender and the Administrative Agent, assign,
pursuant to and in accordance with the provisions of subsection 13.6(c), to one
or more Assignees designated by the Borrower all, but not less than all, of such
Lender's rights and obligations hereunder (other than rights in respect of such
Lender's outstanding CAF Advance), without recourse to or warranty by, or
expense to, such Lender, for a purchase price equal to the outstanding principal
amount of each Revolving Credit Loan then owing to such Lender plus any accrued
but unpaid interest thereon and any accrued but unpaid facility fees and
utilization fees owing thereto and, in addition, all additional costs and
reimbursements, expense reimbursements and indemnities, if any, owing in respect
of such Lender's Commitment hereunder at such time (including any amount that
would be payable under subsection 3.11 if such assignment were, instead, a
prepayment in full of all amounts owing to such Lender) shall be paid to such
Lender.

         3.13 EVIDENCE OF DEBT. (a) Each Lender shall maintain in accordance
with its usual practice an account or accounts evidencing indebtedness of the
Borrower to such Lender resulting from each Loan of such Lender from time to
time, including the amounts of principal and interest payable and paid to such
Lender from time to time under this Agreement.

         (b) The Administrative Agent shall maintain the Register pursuant to
subsection 13.6(d), and a subaccount therein for each Lender, in which shall be
recorded (i) in the case of Revolving Credit Loans and Swingline Loans, the
amount of each Revolving Credit Loan or Swingline Loan made hereunder, the Type
thereof and each Interest Period applicable thereto, (ii) in the case of
Multicurrency Loans, the amount and currency of each Multicurrency Loans and
each Interest Period applicable thereto, (iii) in the case of CAF Advances, the
amount and currency of each CAF Advance made hereunder, the CAF Advance Maturity
Date thereof, the interest rate applicable thereto and each CAF Advance Interest
Payment Date applicable thereto, (iv) the amount of any principal or interest
due and payable or to become due and payable from the Borrower to each Lender
hereunder and (v) both the amount of any sum received by the Administrative
Agent hereunder from the Borrower and each Lender's share thereof.

         (c) The entries made in the Register and the accounts of each Lender
maintained pursuant to subsection 3.13(a) shall, to the extent permitted by
applicable law, be prima facie evidence of the existence and amounts of the
obligations of the Borrower therein recorded; provided, however, that the
failure of any Lender or the Administrative Agent to maintain the Register or
any such account, or any error therein, shall not in any manner affect the
obligation of the Borrower to repay (with applicable interest) the Loans made to
such Borrower by such Lender in accordance with the terms of this Agreement.

         (d) The Borrower agrees that, upon the request to the Administrative
Agent by any Lender, the Borrower will execute and deliver to such Lender a
promissory note of the Borrower

                                       41
<PAGE>

evidencing the Revolving Credit Loans of such Lender, substantially in the form
of Exhibit A with appropriate insertions as to date and principal amount (a
"Revolving Credit Note").

         (e) The Borrower agrees that, upon the request to the Administrative
Agent by any Lender, the Borrower will execute and deliver to such Lender a
promissory note of the Borrower evidencing the CAF Advances of such Lender,
substantially in the form of Exhibit B with appropriate insertions (a "CAF
Advance Note").

                                    SECTION 4
                            LOCAL CURRENCY FACILITIES

         4.1 TERMS OF LOCAL CURRENCY FACILITIES. (a) Subject to the provisions
of this Section 4, the Borrower may in its discretion from time to time
designate any Subsidiary of the Borrower organized under the laws of any
jurisdiction outside the United States as a "Foreign Subsidiary Borrower" and
any Qualified Credit Facility to which such Foreign Subsidiary Borrower and any
one or more Lenders (or its Affiliates, agencies or branches) is a party as a
"Local Currency Facility", with the consent of each such Lender in its sole
discretion, by delivering a Local Currency Facility Addendum to the
Administrative Agent and the Lenders (through the Administrative Agent) executed
by the Borrower, each such Foreign Subsidiary Borrower and each such Lender,
provided, that on the effective date of such designation no Default or Event of
Default shall have occurred and be continuing. Concurrently with the delivery of
a Local Currency Facility Addendum, the Borrower or the relevant Foreign
Subsidiary Borrower shall furnish to the Administrative Agent copies of all
documentation executed and delivered by such Foreign Subsidiary Borrower in
connection therewith, together with, if applicable, an English translation
thereof. Except as otherwise provided in this Section 4 or in the definition of
"Qualified Credit Facility" in subsection 1.1, the terms and conditions of each
Local Currency Facility shall be determined by mutual agreement of the relevant
Foreign Subsidiary Borrower(s) and Local Currency Lender(s). The documentation
governing each Local Currency Facility shall (i) contain an express
acknowledgement that such Local Currency Facility shall be subject to the
provisions of this Section 4, (ii) if more than one Lender is a party thereto,
designate a Local Currency Facility Agent for such Local Currency Facility and
(iii) include an opinion of counsel reasonably satisfactory to the
Administrative Agent from the jurisdiction in which such Local Currency Facility
is established that the documentation governing such Local Currency Facility is
enforceable in accordance with its terms. Each of the Borrower and, by agreeing
to any Local Currency Facility designation as contemplated hereby, each relevant
Local Currency Lender (if any) party thereto which is an Affiliate, branch or
agency of a Lender, acknowledges and agrees that each reference in this
Agreement to any Lender shall, to the extent applicable, be deemed to be a
reference to such Local Currency Lender. In the event of any inconsistency
between the terms of this Agreement and the terms of any Local Currency
Facility, the terms of this Agreement shall prevail.

         (b) The documentation governing each Local Currency Facility shall set
forth (i) the maximum amount (expressed in Dollars) available to be borrowed
from all Local Currency Lenders under such Local Currency Facility (as the same
may be reduced from time to time, a "Local Currency Facility Maximum Borrowing
Amount") and (ii) with respect to each Local Currency Lender party to such Local
Currency Facility, the maximum amount (expressed in

                                       42
<PAGE>

Dollars) available to be borrowed from such Local Currency Lender thereunder (as
the same may be reduced from time to time, a "Local Currency Lender Maximum
Borrowing Amount").

         (c) Except as otherwise required by applicable law, in no event shall
the Local Currency Lenders party to a Local Currency Facility have the right to
accelerate the Local Currency Loans outstanding thereunder, or to terminate
their commitments (if any) to make such Local Currency Loans prior to the
earlier of the stated termination date in respect thereof or the Termination
Date, except, in each case, in connection with an acceleration of the Loans or a
termination of the Commitments pursuant to Section 10 hereof, provided, that
nothing in this paragraph (c) shall be deemed to require any Local Currency
Lender to make a Local Currency Loan if the applicable conditions precedent to
the making of such Local Currency Loan set forth in the documentation governing
the relevant Local Currency Facility have not been satisfied. No Local Currency
Loan may be made under a Local Currency Facility if (i) after giving effect
thereto, the conditions precedent in subsection 7.2 hereof would not be
satisfied or (ii) after giving effect to the making of such Local Currency Loan
and the simultaneous application of the proceeds thereof, (A) the Aggregate
Total Outstandings of all Lenders at any time exceeds the Aggregate Revolving
Credit Commitments or (B) the Dollar Equivalent of the aggregate outstanding
principal amount of Multicurrency Loans, Local Currency Loans and L/C
Obligations attributable to Letters of Credit denominated in any currency other
than Dollars would exceed $600,000,000.

         (d) The relevant Foreign Subsidiary Borrower shall furnish to the
Administrative Agent copies of any amendment, supplement or other modification
(including any change in commitment amounts or in the Local Currency Lenders
participating in any Local Currency Facility) to the terms of any Local Currency
Facility promptly after the effectiveness thereof (together with, if applicable,
an English translation thereof). If any such amendment, supplement or other
modification to a Local Currency Facility shall (i) add a Local Currency Lender
as a Local Currency Lender thereunder or (ii) change the Local Currency Facility
Maximum Borrowing Amount or any Local Currency Lender Maximum Borrowing Amount
with respect thereto, the Borrower shall promptly furnish an appropriately
revised Local Currency Facility Addendum, executed by the Borrower, the relevant
Foreign Subsidiary Borrower and the affected Local Currency Lenders (or any
agent acting on their behalf), to the Administrative Agent and the Lenders
(through the Administrative Agent).

         (e) The Borrower may terminate its designation of a facility as a Local
Currency Facility, with the consent of each Local Currency Lender party thereto
in its sole discretion, by written notice to the Administrative Agent, which
notice shall be executed by the Borrower, the relevant Foreign Subsidiary
Borrower and each Local Currency Lender party to such Local Currency Facility
(or any agent acting on their behalf). Once notice of such termination is
received by the Administrative Agent, such Local Currency Facility and the loans
and other obligations outstanding thereunder shall immediately cease to be
subject to the terms of this Agreement.

         4.2 REPORTING OF LOCAL CURRENCY OUTSTANDINGS. (a) On the date of the
making of any Local Currency Loan having a maturity of 30 or more days to a
Foreign Subsidiary Borrower and on the last Business Day of each month on which
a Foreign Subsidiary Borrower has any outstanding Local Currency Loans, the
Local Currency Facility Agent for such Foreign

                                       43
<PAGE>

Subsidiary Borrower, shall deliver to the Administrative Agent a Notice of Local
Currency Outstandings and the Administrative Agent shall deliver a copy of such
Notice of Local Currency Outstandings to the Lenders. The Administrative Agent
will, at the request of any Local Currency Facility Agent, advise such Local
Currency Facility Agent of the Exchange Rate used by the Administrative Agent in
calculating the Dollar Equivalent of Local Currency Loans under the related
Local Currency Facility on any date.

         (b) For purposes of any calculation under this Agreement in which the
amount of the Aggregate Local Currency Outstandings of any Lender is a
component, the Administrative Agent shall make such calculation on the basis of
the Notices of Local Currency Outstanding received by it at least two Business
Days prior to the date of such calculation.

                                    SECTION 5
                                LETTERS OF CREDIT

         5.1 L/C COMMITMENT. (a) Subject to the terms and conditions hereof, the
Issuing Lender, in reliance on the agreements of the other Lenders set forth in
subsection 5.4(a), agrees to issue letters of credit ("Letters of Credit") for
the account of the Borrower on any Business Day during the Commitment Period in
such form as may be approved from time to time by the Issuing Lender; provided
that the Issuing Lender shall have no obligation to issue any Letter of Credit
if, after giving effect to such issuance, (i) the L/C Obligations would exceed
the L/C Commitment, (ii) the aggregate amount of the Available Revolving Credit
Commitments would be less than zero or (iii) the Dollar Equivalent of the
aggregate outstanding principal amount of Multicurrency Loans, Local Currency
Loans and L/C Obligations attributable to Letters of Credit denominated in any
currency other than Dollars would exceed $600,000,000. Each Letter of Credit
shall (i) be denominated in Dollars or any Available Foreign Currency or any
other currency acceptable to the Issuing Lender (provided, that the Dollar
Equivalent of all L/C Obligations attributable to Letters of Credit denominated
in currencies other than Dollars shall not exceed, in the aggregate,
$600,000,000), (ii) have a face amount of at least $1,000,000 (unless otherwise
agreed by the Issuing Lender) and (iii) expire no later than the date that is
five Business Days prior to the Termination Date.

         (b) The Issuing Lender shall not at any time be obligated to issue any
Letter of Credit if such issuance would conflict with, or cause the Issuing
Lender or any L/C Participant to exceed any limits imposed by, any applicable
Requirement of Law.

         (c) Existing Letters of Credit shall be deemed to be issued under this
Agreement on the Closing Date.

         5.2 PROCEDURE FOR ISSUANCE OF LETTER OF CREDIT. The Borrower may from
time to time request that the Issuing Lender issue a Letter of Credit by
delivering to the Issuing Lender at its address for notices specified herein an
Application therefor, completed to the satisfaction of the Issuing Lender, and
such other certificates, documents and other papers and information as the
Issuing Lender may request. Upon receipt of any Application, the Issuing Lender
will process such Application and the certificates, documents and other papers
and information delivered to it in connection therewith in accordance with its
customary procedures and shall promptly issue the Letter of Credit requested
thereby (but in no event shall the Issuing Lender be required to issue

                                       44
<PAGE>

any Letter of Credit earlier than three Business Days after its receipt of the
Application therefor and all such other certificates, documents and other papers
and information relating thereto) by issuing the original of such Letter of
Credit to the beneficiary thereof or as otherwise may be agreed to by the
Issuing Lender and the Borrower. The Issuing Lender shall furnish a copy of such
Letter of Credit to the Borrower promptly following the issuance thereof. The
Issuing Lender shall promptly furnish to the Administrative Agent, which shall
in turn promptly furnish to the Lenders, notice of the issuance of each Letter
of Credit (including the amount thereof).

         5.3 FEES AND OTHER CHARGES. (a) The Borrower will pay a fee on the
average daily undrawn and unexpired amount of all outstanding Letters of Credit
at a per annum rate equal to the Applicable Margin then in effect with respect
to Eurodollar Loans, shared ratably among the Revolving Lenders and payable
quarterly in arrears on each L/C Fee Payment Date after the issuance date; such
fee with respect to each Letter of Credit denominated in any currency other than
Dollars shall be payable in Dollars, and for purposes of calculating the amount
of such fee applicable to each Letter of Credit denominated in any currency
other than Dollars, the average daily undrawn and unexpired amount of such
Letter of Credit shall be the Dollar Equivalent of such amount calculated at the
Exchange Rate as of the relevant L/C Fee Payment Date. In addition, the Borrower
shall pay to the Issuing Lender for its own account a fronting fee of 0.125% per
annum on the average daily undrawn and unexpired amount of each Letter of
Credit, payable quarterly in arrears on each L/C Fee Payment Date after the
issuance date; such fee with respect to each Letter of Credit denominated in any
currency other than Dollars shall be payable in Dollars, and for purposes of
calculating the amount of such fee applicable to each Letter of Credit
denominated in any currency other than Dollars, the average daily undrawn and
unexpired amount of such Letter of Credit shall be the Dollar Equivalent of such
amount calculated at the Exchange Rate as of the relevant L/C Fee Payment Date.

         (b) In addition to the foregoing fees, the Borrower shall pay or
reimburse the Issuing Lender for such normal and customary costs and expenses as
are incurred or charged by the Issuing Lender in issuing, negotiating, effecting
payment under, amending or otherwise administering any Letter of Credit.

         5.4 L/C PARTICIPATIONS. (a) The Issuing Lender irrevocably agrees to
grant and hereby grants to each L/C Participant, and, to induce the Issuing
Lender to issue Letters of Credit, each L/C Participant irrevocably agrees to
accept and purchase and hereby accepts and purchases from the Issuing Lender, on
the terms and conditions set forth below, for such L/C Participant's own account
and risk an undivided interest equal to such L/C Participant's Revolving Credit
Commitment Percentage in the Issuing Lender's obligations and rights under and
in respect of each Letter of Credit and the amount of each draft paid by the
Issuing Lender thereunder. Each L/C Participant unconditionally and irrevocably
agrees with the Issuing Lender that, if a draft is paid under any Letter of
Credit for which the Issuing Lender is not reimbursed in full by the Borrower in
accordance with the terms of this Agreement, such L/C Participant shall pay to
the Issuing Lender upon demand at the Issuing Lender's address for notices
specified herein an amount equal to such L/C Participant's Revolving Credit
Commitment Percentage of the amount of such draft, or any part thereof, that is
not so reimbursed.

         (b) If any amount required to be paid by any L/C Participant to the
Issuing Lender pursuant to subsection 5.4(a) in respect of any unreimbursed
portion of any payment made by the

                                       45
<PAGE>

Issuing Lender under any Letter of Credit is paid to the Issuing Lender within
three Business Days after the date such payment is due, such L/C Participant
shall pay to the Issuing Lender on demand an amount equal to the product of (i)
such amount, times (ii) the daily average Federal Funds Effective Rate during
the period from and including the date such payment is required to the date on
which such payment is immediately available to the Issuing Lender, times (iii) a
fraction the numerator of which is the number of days that elapse during such
period and the denominator of which is 360. If any such amount required to be
paid by any L/C Participant pursuant to subsection 5.4(a) is not made available
to the Issuing Lender by such L/C Participant within three Business Days after
the date such payment is due, the Issuing Lender shall be entitled to recover
from such L/C Participant, on demand, such amount with interest thereon
calculated from such due date at the rate per annum applicable to ABR Loans. A
certificate of the Issuing Lender submitted to any L/C Participant with respect
to any amounts owing under this Section shall be conclusive in the absence of
manifest error.

         (c) Whenever, at any time after the Issuing Lender has made payment
under any Letter of Credit and has received from any L/C Participant its pro
rata share of such payment in accordance with subsection 5.4(a), the Issuing
Lender receives any payment related to such Letter of Credit (whether directly
from the Borrower or otherwise, including proceeds of collateral applied thereto
by the Issuing Lender), or any payment of interest on account thereof, the
Issuing Lender will distribute to such L/C Participant its pro rata share
thereof; provided, however, that in the event that any such payment received by
the Issuing Lender shall be required to be returned by the Issuing Lender, such
L/C Participant shall return to the Issuing Lender the portion thereof
previously distributed by the Issuing Lender to it.

         5.5 REIMBURSEMENT OBLIGATION OF THE BORROWER. The Borrower agrees to
reimburse the Issuing Lender on the Business Day next succeeding the Business
Day on which the Issuing Lender notifies the Borrower of the date and amount of
a draft presented under any Letter of Credit and paid by the Issuing Lender for
the amount of (a) such draft so paid and (b) any taxes, fees, charges or other
costs or expenses incurred by the Issuing Lender in connection with such
payment. Each such payment shall be made to the Issuing Lender in Dollars and in
immediately available funds. Interest shall be payable on any such amounts from
the date on which the relevant draft is paid until payment in full at the rate
set forth in (i) until the Business Day next succeeding the date of the relevant
notice, subsection 3.4(b) and (ii) thereafter, subsection 3.4(e). Each drawing
under any Letter of Credit shall (unless an event of the type described in
clause (i) or (ii) of Section 10(e) shall have occurred and be continuing with
respect to the Borrower, in which case the procedures specified in subsection
5.4 for funding by L/C Participants shall apply) constitute a request by the
Borrower to the Administrative Agent for a borrowing pursuant to subsection 2.2
of ABR Loans in the amount of such drawing (and the minimum borrowing amount in
such subsection shall not apply to such borrowing). The Borrowing Date with
respect to such borrowing shall be the first date on which a borrowing of
Revolving Credit Loans could be made, pursuant to subsection 2.2, if the
Administrative Agent had received a notice of such borrowing at the time the
Administrative Agent receives notice from the relevant Issuing Lender of such
drawing under such Letter of Credit.

         5.6 OBLIGATIONS ABSOLUTE. The Borrower's obligations under this Section
5 shall be absolute and unconditional under any and all circumstances and
irrespective of any setoff, counterclaim or defense to payment that the Borrower
may have or have had against the Issuing

                                       46
<PAGE>

Lender, any beneficiary of a Letter of Credit or any other Person. The Borrower
also agrees with the Issuing Lender that the Issuing Lender shall not be
responsible for, and the Borrower's Reimbursement Obligations under subsection
5.5 shall not be affected by, among other things, the validity or genuineness of
documents or of any endorsements thereon, even though such documents shall in
fact prove to be invalid, fraudulent or forged, or any dispute between or among
the Borrower and any beneficiary of any Letter of Credit or any other party to
which such Letter of Credit may be transferred or any claims whatsoever of the
Borrower against any beneficiary of such Letter of Credit or any such
transferee. The Issuing Lender shall not be liable for any error, omission,
interruption or delay in transmission, dispatch or delivery of any message or
advice, however transmitted, in connection with any Letter of Credit, except for
errors or omissions found by a final and nonappealable decision of a court of
competent jurisdiction to have resulted from the gross negligence or willful
misconduct of the Issuing Lender. The Borrower agrees that any action taken or
omitted by the Issuing Lender under or in connection with any Letter of Credit
or the related drafts or documents, if done in the absence of gross negligence
or willful misconduct and in accordance with the standards of care specified in
the Uniform Commercial Code of the State of New York, shall be binding on the
Borrower and shall not result in any liability of the Issuing Lender to the
Borrower.

         5.7 LETTER OF CREDIT PAYMENTS. If any draft shall be presented for
payment under any Letter of Credit, the Issuing Lender shall promptly notify the
Borrower of the date and amount thereof. The responsibility of the Issuing
Lender to the Borrower in connection with any draft presented for payment under
any Letter of Credit shall, in addition to any payment obligation expressly
provided for in such Letter of Credit, be limited to determining that the
documents (including each draft) delivered under such Letter of Credit in
connection with such presentment are substantially in conformity with such
Letter of Credit.

         5.8 APPLICATIONS. To the extent that any provision of any Application
related to any Letter of Credit is inconsistent with the provisions of this
Section 5, the provisions of this Section 5 shall apply.

         5.9 REIMBURSEMENT OBLIGATIONS FOR CERTAIN LETTERS OF CREDIT DENOMINATED
IN CURRENCIES OTHER THAN DOLLARS. Notwithstanding any other provision of this
Section 5, in the event that any Letter of Credit is denominated in any currency
other than Dollars, the amount of the Reimbursement Obligation of the Borrower
pursuant to Section 5.5 in respect of such Letter of Credit shall bear interest
as provided in Section 5.5 with respect to amounts owing in Dollars; provided,
that (i) the interest rate on such amounts shall be the rate reasonably
determined by the Issuing Lender to be the equivalent rate, in respect of the
relevant non-Dollar currency, to the applicable rate provided in Section 5.5
with respect to amounts denominated in Dollars and (ii) if the Borrower fails to
pay any such Reimbursement Obligation required by Section 5.5 on or prior to the
third Business Day following the date of the drawing to which such Reimbursement
Obligation relates, then, on the fourth Business Day following such date of
drawing, the relevant Issuing Lender, in cooperation with the Administrative
Agent, shall determine the Dollar Equivalent of the amount of such Reimbursement
Obligation, and the Borrower's obligation in respect of such Reimbursement
Obligation shall be converted to such Dollar Equivalent, with interest thereon
as provided in Section 5.5 (provided, that if the Application in respect of such
Letter of Credit provides for conversion of such amount into Dollars on any
earlier date or at any

                                       47
<PAGE>

other conversion rate, the provisions of such Application shall control with
respect to such conversion).

                                    SECTION 6
                         REPRESENTATIONS AND WARRANTIES

         To induce the Administrative Agent and the Lenders to enter into this
Agreement and to make the Loans and issue or participate in the Letters of
Credit, the Borrower hereby represents and warrants to the Administrative Agent
and each Lender that:

         6.1 FINANCIAL CONDITION. The consolidated balance sheet of the Borrower
and its consolidated Subsidiaries as at December 31, 2003 and December 31, 2002
and the related consolidated statements of operations and of cash flows for the
fiscal years ended on such dates, reported on by Ernst & Young LLP, copies of
which have heretofore been furnished to each Lender, are complete and correct
and present fairly the consolidated financial condition of the Borrower and its
consolidated Subsidiaries as at such dates, and the consolidated results of
their operations and their consolidated cash flows for the fiscal years then
ended. The unaudited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as at March 31, 2004 or, if later and prior to the
Signing Date, the date of the Borrower's most recent publicly available Form
10-Q and the related unaudited consolidated statements of operations and of cash
flows for the fiscal period ended on such date, certified by a Responsible
Officer, copies of which have heretofore been furnished to each Lender, are
complete and materially correct and present fairly (subject to normal year-end
audit adjustments) the consolidated financial condition of the Borrower and its
consolidated Subsidiaries as at such date, and the consolidated results of their
operations and their consolidated cash flows for the fiscal period then ended.
All such annual financial statements, including the related schedules and notes
thereto, were, as of the date prepared, prepared in accordance with GAAP applied
consistently throughout the periods involved (except as approved by such
accountants or Responsible Officer, as the case may be, and as disclosed
therein). The quarterly financial statements have been prepared in accordance
with generally accepted accounting principles for interim financial information
and with the instructions to Form 10-Q and Article 10 of Regulation S-X under
the Securities Act of 1933. Accordingly, such quarterly statements do not
include all of the information and footnotes required by GAAP for complete
financial statements. In the opinion of the Borrower, all adjustments
(consisting only of normal recurring accruals) considered necessary for a fair
presentation have been included. Neither the Borrower nor any of its
consolidated Subsidiaries had, at the date of the most recent balance sheet
referred to above, any material Guarantee Obligation, material contingent
liability or material liability for taxes, or any material long-term lease or
material unusual forward or long-term commitment, including, without limitation,
any interest rate or foreign currency swap or exchange transaction, which is not
reflected in the foregoing statements or in the notes thereto.

         6.2 NO CHANGE. Since December 31, 2003, there has been no development
or event which has had or could reasonably be expected to have a Material
Adverse Effect.

         6.3 CORPORATE EXISTENCE; COMPLIANCE WITH LAW. Each of the Borrower and
its Subsidiaries (a) is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization, (b) has the corporate
power and authority, and the legal right, to

                                       48
<PAGE>

own and operate its property, to lease the property it operates as lessee and to
conduct the business in which it is currently engaged, (c) is duly qualified as
a foreign corporation and in good standing under the laws of each jurisdiction
where its ownership, lease or operation of property or the conduct of its
business requires such qualification and (d) is in compliance with all
Requirements of Law, except to the extent that the failure of the foregoing
clauses (a) (only with respect to Subsidiaries of the Borrower), (c) and (d) to
be true and correct could not, in the aggregate, reasonably be expected to have
a Material Adverse Effect.

         6.4  CORPORATE POWER; CONSENTS AND AUTHORIZATION; ENFORCEABLE
OBLIGATIONS. The Borrower has the corporate power and authority, and the legal
right, to make, deliver and perform the Loan Documents to which it is a party
and to borrow hereunder and has taken all necessary corporate action to
authorize the borrowings on the terms and conditions of this Agreement, any
Notes and any Applications and to authorize the execution, delivery and
performance of the Loan Documents to which it is a party. No consent or
authorization of, filing with, notice to or other act by or in respect of, any
Governmental Authority (including, without limitation, exchange control) or any
other Person is required with respect to the Borrower or any of its Subsidiaries
in connection with the borrowings hereunder or with the execution, delivery,
performance, validity or enforceability of the Loan Documents to which the
Borrower is a party. This Agreement and each other Loan Document to which the
Borrower is, or is to become, a party has been or will be, duly executed and
delivered on behalf of the Borrower. This Agreement and each other Loan Document
to which the Borrower is, or is to become, a party constitutes or will
constitute, a legal, valid and binding obligation of the Borrower enforceable
against the Borrower in accordance with its terms, subject to the effects of
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and
other similar laws relating to or affecting creditors' rights generally, general
equitable principles (whether considered in a proceeding in equity or at law)
and an implied covenant of good faith and fair dealing.

         6.5  NO LEGAL BAR. The execution, delivery and performance of the Loan
Documents, the borrowings hereunder and the use of the proceeds thereof will not
violate any Requirement of Law or Contractual Obligation of the Borrower or of
any of its Subsidiaries which could reasonably be expected to have a Material
Adverse Effect and will not result in, or require, the creation or imposition of
any Lien on any of its or their respective properties or revenues pursuant to
any such Requirement of Law or Contractual Obligation which could reasonably be
expected to have a Material Adverse Effect.

         6.6  NO MATERIAL LITIGATION. Except as disclosed in the Borrower's Form
10-K dated December 31, 2003 or the Borrower's form 10-Q dated March 31, 2004
or, if later and prior to the Signing Date, the date of the Borrower's most
recent publicly available Form 10-Q, no litigation, investigation or proceeding
of or before any arbitrator or Governmental Authority is pending or, to the
knowledge of the Borrower, threatened by or against the Borrower or any of its
Subsidiaries or against any of its or their respective properties or revenues
(a) with respect to any of the Loan Documents or any of the transactions
contemplated hereby, or (b) which could reasonably be expected to have a
Material Adverse Effect.

         6.7  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 which could reasonably be

                                       49
<PAGE>

expected to have a Material Adverse Effect. No Default or Event of Default has
occurred and is continuing.

         6.8 INTELLECTUAL PROPERTY. Except as disclosed in the Borrower's Form
10-K dated December 31, 2003 or the Borrower's Form 10-Q dated March 31, 2004
or, if later and prior to the Signing Date, the date of the Borrower's most
recent publicly available Form 10-Q, the Borrower and each of its Subsidiaries
owns, or is licensed to use, all trademarks, tradenames, copyrights, technology,
know-how and processes necessary for the conduct of its business as currently
conducted except for those the failure to own or license which could not
reasonably be expected to have a Material Adverse Effect (the "Intellectual
Property"). Except as disclosed in the Borrower's Form 10-K dated December 31,
2003 or the Borrower's Form 10-Q dated March 31, 2004 or, if later and prior to
the Signing Date, the date of the Borrower's most recent publicly available Form
10-Q, no claim has been asserted and is pending by any Person challenging or
questioning the use of any such Intellectual Property or the validity or
effectiveness of any such Intellectual Property, nor does the Borrower know of
any valid basis for any such claim, except for such claims that, in the
aggregate, could not reasonably be expected to have a Material Adverse Effect.
Except as disclosed in the Borrower's Form 10-K dated December 31, 2003 or the
Borrower's Form 10-Q dated March 31, 2004 or, if later and prior to the Signing
Date, the date of the Borrower's most recent publicly available Form 10-Q, the
use of such Intellectual Property by the Borrower and its Subsidiaries does not
infringe on the rights of any Person, except for such claims and infringements
that, in the aggregate, could not reasonably be expected to have a Material
Adverse Effect.

         6.9 TAXES. Each of the Borrower and its Subsidiaries has filed or
caused to be filed all tax returns which, to the knowledge of the Borrower, are
required to be filed and has paid all taxes shown to be due and payable on said
returns or on any assessments made against it (other than any the amount or
validity of which are currently being contested in good faith by appropriate
proceedings and with respect to which reserves in conformity with GAAP have been
provided on the books of the Borrower or its Subsidiaries, as the case may be),
except to the extent that the failure to do so could not reasonably be expected
to result in a Material Adverse Effect.

         6.10 FEDERAL REGULATIONS. No part of the proceeds of any Loans will be
used in any manner that would violate Regulation U of the Board as now and from
time to time hereafter in effect.

         6.11 ERISA. Neither a Reportable Event nor an "accumulated funding
deficiency" (within the meaning of Section 412 of the Code or Section 302 of
ERISA) has occurred during the five-year period prior to the date on which this
representation is made or deemed made with respect to any Plan other than a
Multiemployer Plan, and each Plan has complied in all material respects with the
applicable provisions of ERISA and the Code, where the liability could be
reasonably expected to result could have a Material Adverse Effect; provided,
however, that with respect to any Multiemployer Plan, such representation is
made only to the knowledge of the Borrower. No termination of a Single Employer
Plan pursuant to Section 4041(c) or 4042 of ERISA has occurred, and no Lien in
favor of the PBGC or a Plan has arisen, during such five-year period. The
present value of all accrued benefits under each Single Employer Plan (based on
those assumptions used to fund such Plans) did not, as of the last annual
valuation date prior to

                                       50
<PAGE>

the date on which this representation is made or deemed made, exceed the value
of the assets of such Plan allocable to such accrued benefits by a material
amount. Neither the Borrower nor any Commonly Controlled Entity has had a
complete or partial withdrawal from any Multiemployer Plan and to the knowledge
of the Borrower, neither the Borrower nor any Commonly Controlled Entity would
become subject to any liability under ERISA if the Borrower or any such Commonly
Controlled Entity were to withdraw completely from all Multiemployer Plans as of
the valuation date most closely preceding the date on which this representation
is made or deemed made which liability could be reasonably expected to result
could have a Material Adverse Effect. No such Multiemployer Plan is in
Reorganization or Insolvent.

         6.12 INVESTMENT COMPANY ACT; OTHER REGULATIONS. The Borrower is not an
"investment company", or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended. The
Borrower is not subject to regulation under any Federal or State statute or
regulation (other than Regulation X of the Board) which limits its ability to
incur Indebtedness.

         6.13 PURPOSE OF LOANS. The proceeds of the Loans shall be used to
finance the working capital and general corporate needs of the Borrower and its
Subsidiaries, including but not limited to acquisitions.

         6.14 ENVIRONMENTAL MATTERS. Except to the extent that the failure of
the following statements to be true and correct could not reasonably be expected
to have a Material Adverse Effect:

         (a) The facilities and properties owned, leased or operated by the
Borrower or any of its Subsidiaries (the "Properties") do not contain, and have
not previously contained, any Materials of Environmental Concern in amounts or
concentrations which (i) constitute or constituted a violation of, or (ii) could
reasonably be expected to give rise to liability under, any Environmental Law.

         (b) The Properties and all operations at the Properties are in
compliance, and have in the last five years been in compliance, in all material
respects with all applicable Environmental Laws, and there is no contamination
at, under or about the Properties or violation of any Environmental Law with
respect to the Properties or the business operated by the Borrower or any of its
Subsidiaries (the "Business") which could reasonably be expected to materially
interfere with the continued operation of the Properties or materially impair
the fair saleable value thereof.

         (c) Neither the Borrower nor any of its Subsidiaries has received any
notice of violation, alleged violation, non-compliance, liability or potential
liability regarding environmental matters or compliance with Environmental Laws
with regard to any of the Properties or the Business, nor does the Borrower have
knowledge or reason to believe that any such notice will be received or is being
threatened.

         (d) Materials of Environmental Concern have not been transported or
disposed of from the Properties in violation of, or in a manner or to a location
which could reasonably be expected to give rise to liability under, any
Environmental Law, nor have any Materials of

                                       51
<PAGE>

Environmental Concern been generated, treated, stored or disposed of at, on or
under any of the Properties in violation of, or in a manner that could
reasonably be expected to give rise to liability under, any applicable
Environmental Law.

         (e) No judicial proceeding or governmental or administrative action is
pending or, to the knowledge of the Borrower, threatened, under any
Environmental Law to which the Borrower or any Subsidiary is or will be named as
a party with respect to the Properties or the Business, nor are there any
consent decrees or other decrees, consent orders, administrative orders or other
orders, or other administrative or judicial requirements outstanding under any
Environmental Law with respect to the Properties or the Business.

         (f) There has been no release or threat of release of Materials of
Environmental Concern at or from the Properties, or arising from or related to
the operations of the Borrower or any Subsidiary in connection with the
Properties or otherwise in connection with the Business, in violation of or in
amounts or in a manner that could reasonably be expected to give rise to
liability under Environmental Laws.

         6.15 DISCLOSURE. The statements and information contained herein and in
any of the information provided to the Administrative Agent or the Lenders in
writing in connection with this Agreement, taken as a whole, do not contain any
untrue statement of any material fact, or omit to state a fact necessary in
order to make such statements or information not misleading in any material
respect, in each case in light of the circumstances under which such statements
were made or information provided as of the date so provided.


                                    SECTION 7
                              CONDITIONS PRECEDENT

         7.1 CONDITIONS TO INITIAL LOANS AND LETTERS OF CREDIT. The agreement of
each Lender to make the initial Loan requested to be made by it, or to issue any
Letter of Credit, is subject to the satisfaction on the Closing Date of the
following conditions precedent:

         (a) Credit Agreement. The Administrative Agent shall have received this
Agreement, executed and delivered by a duly authorized officer of each Lender
and the Borrower, with a counterpart for each Lender and original Notes executed
by the Borrower in favor of each Lender requesting a Note.

         (b) Closing Certificate. The Administrative Agent shall have received,
with a counterpart for each Lender, a certificate of the Borrower, dated the
Closing Date, substantially in the form of Exhibit F, with appropriate
insertions and attachments, satisfactory in form and substance to the
Administrative Agent, executed by the President or any Vice President and the
Secretary or any Assistant Secretary of the Borrower.

         (c) Representations and Warranties. Each of the representations and
warranties made by the Borrower in or pursuant to the Loan Documents shall be
true and correct in all material respects on and as of the Closing Date as if
made on and as of the Closing Date.

         (d) Termination of Existing Credit Facilities. Evidence that all
principal amounts, interest, fees and other amounts owed under the Existing
Credit Facilities (other than Letters of

                                       52
<PAGE>

Credit, if any, referred to in subsection 5.1(c) that have been issued pursuant
to the Existing Credit Facilities, that will be deemed issued under this
Agreement on the Closing Date) on the Closing Date shall have been paid in full
on or before the Closing Date and all commitments and agreements with respect
thereto shall have been terminated.

         (e) Legal Opinion. The Administrative Agent shall have received, with a
counterpart for each Lender, the executed legal opinion of counsel to the
Borrower (which opinion may be delivered in part by in-house counsel to the
Borrower), covering the matters set forth in Exhibit G. Such legal opinion shall
cover such other matters incident to the transactions contemplated by this
Agreement as the Administrative Agent may reasonably require.

         (f) Approvals. All governmental and third party approvals necessary in
connection with the execution, delivery and performance of this Agreement and
the other Loan Documents shall have been obtained and be in full force and
effect.

         (g) Financial Statements; Pro Forma Projected Consolidated
Capitalization. The Lenders shall have received (i) satisfactory audited
consolidated financial statements of the Borrower and its consolidated
Subsidiaries for the two most recent fiscal years ended prior to the Closing
Date as to which such financial statements are available and (ii) satisfactory
unaudited interim consolidated financial statements of the Borrower and its
consolidated Subsidiaries for each quarterly period ended subsequent to the date
of the latest financial statements delivered pursuant to clause (i) of this
paragraph as to which such financial statements are available.

         (h) Fees. The Lenders and the Administrative Agent shall have received
all fees required to be paid and all expenses required to be paid by the
Borrower pursuant to the terms hereof and for which invoices have been presented
at least five (5) Business Days in advance, on or before the Closing Date.

         7.2 CONDITIONS TO EACH LOAN AND LETTER OF CREDIT. The agreement of each
Lender to make any Loan requested to be made by it on any date, or to issue any
Letter of Credit, (including, without limitation, its initial Loan) is subject
to the satisfaction of the following conditions precedent:

         (a) Representations and Warranties. Each of the representations and
warranties made by the Borrower in or pursuant to the Loan Documents shall be
true and correct in all material respects on and as of such date as if made on
and as of such date (other than, in the case of any Loan made after the Closing
Date, the representations and warranties in subsections 6.2, 6.6 and 6.8 which
shall be true and correct in all material respects on and as of the Closing
Date).

         (b) No Default. No Default or Event of Default shall have occurred and
be continuing on such date or after giving effect to the Loans requested to be
made, or Letters of Credit requested to be issued.

         (c) Each borrowing by the Borrower hereunder, and each request by the
Borrower for the issuance of a Letter of Credit shall constitute a
representation and warranty by the Borrower as of the date thereof that the
conditions contained in this subsection have been satisfied.

                                       53
<PAGE>

                                    SECTION 8
                              AFFIRMATIVE COVENANTS

         The Borrower hereby agrees that, so long as the Commitments (or any of
them) remain in effect, any Letter of Credit is outstanding or any amount is
owing to any Lender or the Administrative Agent hereunder or under any other
Loan Documents, the Borrower shall and (except in the case of delivery of
financial information, reports and notices) shall cause each of its Subsidiaries
to:

         8.1 FINANCIAL STATEMENTS. Furnish to each Lender:

         (a) as soon as available, but in any event not later than 20 days after
required to be filed with the Securities and Exchange Commission at the end of
each fiscal year of the Borrower, a copy of the consolidated balance sheet of
the Borrower and its consolidated Subsidiaries as at the end of such year and
the related consolidated statements of operations and stockholders' equity and
of cash flows for such year, setting forth in each case in comparative form the
figures for the previous year, reported on without a "going concern" or like
qualification or exception, or qualification arising out of the scope of the
audit, by Ernst & Young LLP or other independent certified public accountants of
nationally recognized standing;

         (b) as soon as available, but in any event not later than 15 days after
required to be filed with the Securities and Exchange Commission at the end of
each of the first three quarterly periods of each fiscal year of the Borrower,
the unaudited consolidated balance sheet of the Borrower and its consolidated
Subsidiaries as at the end of such quarter and the related unaudited
consolidated statements of operations for such quarter and the portion of the
fiscal year through the end of such quarter and of cash flows of the Borrower
and its consolidated Subsidiaries for the portion of the fiscal year through the
end of such quarter, setting forth in each case in comparative form the figures
for the previous year, certified by a Responsible Officer as being fairly stated
in all material respects (subject to normal year-end audit adjustments); and

         (c) all such financial statements shall be complete and correct in all
material respects and shall be prepared in reasonable detail and in accordance
with GAAP applied consistently throughout the periods reflected therein and with
prior periods (except as approved by such accountants or officer, as the case
may be, and disclosed therein); provided, that it is hereby acknowledged that
the quarterly financial statements delivered pursuant to paragraph (b) above may
not include all of the information and footnotes required by GAAP for complete
annual financial statements.

Any financial statement required to be furnished pursuant to this subsection 8.1
shall be deemed to have been furnished on the date on which the Lenders receive
notice that the Borrower has posted such financial statement on the Intralinks
website on the Internet at www.intralinks.com; provided that the Borrower shall
give notice of any such posting to the Administrative Agent (who shall then give
notice of any such posting to the Lenders). Notwithstanding the foregoing, the
Borrower shall deliver paper copies of any financial statement referred to in
this subsection 8.1 to the Administrative Agent if the Administrative Agent or
any Lender requests the Borrower to furnish such paper copies until written
notice to cease delivering such paper copies is given by the Administrative
Agent.

                                       54
<PAGE>

         8.2 CERTIFICATES; OTHER INFORMATION. Furnish to the Administrative
Agent with sufficient copies for the Lenders:

         (a) concurrently with the delivery of the financial statements referred
to in subsections 8.1(a) and 8.1(b), a certificate of a Responsible Officer
stating that such Officer has obtained no knowledge of any Default or Event of
Default that has occurred and is continuing except as specified in such
certificate, and including calculations demonstrating compliance with subsection
9.1;

         (b) within ten days after the same are sent, copies of all financial
statements and reports which the Borrower sends to its stockholders, and within
five days after the same are filed, copies of all financial statements and
reports which the Borrower may make to, or file with, the Securities and
Exchange Commission or any successor or analogous Governmental Authority, and
promptly after the same are issued, copies of all press releases issued by the
Borrower; and

         (c) promptly, such additional financial and other information as any
Lender may from time to time reasonably request.

         8.3 PAYMENT OF OBLIGATIONS. Pay, discharge or otherwise satisfy at or
before maturity or before they become delinquent, as the case may be, all its
material obligations of whatever nature, except where the amount or validity
thereof is currently being contested in good faith by appropriate proceedings
and reserves in conformity with GAAP with respect thereto have been provided on
the books of the Borrower or its Subsidiaries, as the case may be.

         8.4 CONDUCT OF BUSINESS AND MAINTENANCE OF EXISTENCE. (a) Continue to
engage in business of the same general type as conducted by it on the Signing
Date; (b) preserve, renew and keep in full force and effect its corporate
existence (except as could not in the aggregate be reasonably expected to have a
Material Adverse Effect); (c) take all reasonable action to maintain all rights,
privileges and franchises necessary or desirable in the normal conduct of its
business except as otherwise permitted pursuant to subsection 9.4; and (d)
comply with all Contractual Obligations and Requirements of Law except to the
extent that failure to comply therewith could not, in the aggregate, be
reasonably expected to have a Material Adverse Effect.

         8.5 MAINTENANCE OF PROPERTY; INSURANCE. Keep all property necessary in
its business in good working order and condition except to the extent that
failure to do so could not, in the aggregate, be reasonably expected to have a
Material Adverse Effect; maintain with financially sound and reputable insurance
companies insurance on all its property in at least such amounts and against at
least such risks as are adequate for conducting its business; and furnish to
each Lender, upon written request, full information as to the insurance carried.

         8.6 INSPECTION OF PROPERTY; BOOKS AND RECORDS; DISCUSSIONS. Keep proper
books of records and account in which full, true and correct entries in
conformity with GAAP and all Requirements of Law shall be made of all dealings
and transactions in relation to its business and activities; and permit
representatives of any Lender (upon reasonable advance notice coordinated
through the Administrative Agent) to visit and inspect any of its properties and
examine and make abstracts from any of its books and records at any reasonable
time and as often as may

                                       55
<PAGE>

reasonably be desired and to discuss the business, operations, properties and
financial and other condition of the Borrower and its Subsidiaries with officers
and employees of the Borrower and its Subsidiaries and with its independent
certified public accountants.

         8.7 NOTICES. Promptly give notice to the Administrative Agent and each
Lender of:

         (a) the occurrence of any Default or Event of Default;

         (b) any (i) default or event of default under any Contractual
Obligation of the Borrower or any of its Subsidiaries or (ii) litigation,
investigation or proceeding which may exist at any time involving the Borrower
or any of its Subsidiaries, which in either case, could reasonably be expected
to have a Material Adverse Effect; and

         (c) the following events, as soon as possible and in any event within
30 days after the Borrower knows or has reason to know thereof: (i) the
occurrence or expected occurrence of any Reportable Event with respect to any
Plan, a failure to make any required contribution to a Plan, the creation of any
Lien in favor of the PBGC or a Plan or any withdrawal from, or the termination,
Reorganization or Insolvency of, any Multiemployer Plan or (ii) the institution
of proceedings or the taking of any other action by the PBGC or the Borrower or
any Commonly Controlled Entity or any Multiemployer Plan with respect to the
withdrawal from, or the terminating, Reorganization or Insolvency of, any Plan,
other than the termination of any Single Employer Plan pursuant to Section
4041(b) of ERISA where, in connection with any of the foregoing, the amount of
liability the Borrower or any Commonly Controlled Entity could reasonably be
expected to incur would be material.

Each notice pursuant to this subsection shall be accompanied by a statement of a
Responsible Officer setting forth details of the occurrence referred to therein
and stating what action the Borrower proposes to take with respect thereto.


                                   SECTION 9
                               NEGATIVE COVENANTS

         The Borrower hereby agrees that, so long as the Commitments (or any of
them) remain in effect, any Letter of Credit remains outstanding, or any amount
is owing to any Lender or the Administrative Agent hereunder or under any other
Loan Documents, the Borrower shall not, and (except with respect to subsection
9.1) shall not permit any of its Subsidiaries to, directly or indirectly:

         9.1 FINANCIAL COVENANT. Consolidated Leverage Ratio. Permit the
Consolidated Leverage Ratio as at the last day of any period of four consecutive
fiscal quarters of the Borrower to exceed 3.5 to 1.0.

         9.2 LIMITATION ON LIENS. Create, incur, assume or suffer to exist any
Lien upon any of its property, assets or revenues, whether now owned or
hereafter acquired, except for:

         (a) Liens for taxes not yet due or which are being contested in good
faith by appropriate proceedings, provided that adequate reserves with respect
thereto are maintained on the books of the Borrower or its Subsidiaries, as the
case may be, in conformity with GAAP;

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<PAGE>

         (b) carriers', warehousemen's, mechanics', materialmen's, repairmen's
or other like Liens arising in the ordinary course of business which are not
overdue for a period of more than 60 days or which are being contested in good
faith by appropriate proceedings;

         (c) pledges or deposits in connection with workers' compensation,
unemployment insurance and other social security legislation and deposits
securing liability to insurance carriers under insurance or self-insurance
arrangements;

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

         (e) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business which, in the
aggregate, are not substantial in amount and which do not in any case materially
detract from the value of the property subject thereto or materially interfere
with the ordinary conduct of the business of the Borrower or such Subsidiary;

         (f) Liens in existence on the date hereof listed on Schedule 9.2,
provided that no such Lien is spread to cover any additional property after the
Closing Date and that the amount of Indebtedness secured thereby is not
increased;

         (g) Liens securing Indebtedness of the Borrower and its Subsidiaries
incurred to finance the acquisition of fixed or capital assets, provided that
(i) such Liens shall be created substantially simultaneously with the
acquisition of such fixed or capital assets, (ii) such Liens do not at any time
encumber any property other than the property financed by such Indebtedness and
(iii) the amount of Indebtedness secured thereby is not increased;

         (h) Liens on the property or assets of a corporation which becomes a
Subsidiary after the date hereof, provided that (i) such Liens existed at the
time such corporation became a Subsidiary and were not created in anticipation
thereof, (ii) any such Lien is not spread to cover any property or assets of
such corporation after the time such corporation becomes a Subsidiary, and (iii)
the amount of Indebtedness secured thereby is not increased;

         (i) Liens created pursuant to any Receivables Transaction permitted
pursuant to subsection 9.3(a); and

         (j) Liens (not otherwise permitted hereunder) which secure obligations
not exceeding (as to the Borrower and all Subsidiaries) $100,000,000 in
aggregate amount at any time.

         9.3 LIMITATION ON INDEBTEDNESS. Create, issue, incur, assume, become
liable in respect of or suffer to exist:

         (a) any Indebtedness pursuant to any Receivables Transaction, except
for Indebtedness pursuant to all Receivables Transactions in an aggregate
principal amount not exceeding 20% of Consolidated Tangible Assets; or

         (b) any Indebtedness of any of the Subsidiaries of the Borrower other
than (x) Indebtedness of any Receivables Subsidiary pursuant to any Receivables
Transaction permitted

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under subsection 9.3(a), (y) any Indebtedness of any Subsidiary of the Borrower
owing to the Borrower or to any other Subsidiary of the Borrower and (z) any
other Indebtedness of Subsidiaries of the Borrower in an aggregate principal
amount at any time outstanding not to exceed 20% of Consolidated Tangible
Assets.

         9.4 LIMITATION ON FUNDAMENTAL CHANGES. Enter into any merger,
consolidation or amalgamation, or liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution), or convey, sell, lease, assign, transfer
or otherwise dispose of, all or substantially all of its property, business or
assets, except:

         (a) any Subsidiary of the Borrower may be merged or consolidated with
or into the Borrower (provided that the Borrower shall be the continuing or
surviving corporation) or with or into any one or more wholly owned Subsidiaries
of the Borrower (provided that the wholly owned Subsidiary or Subsidiaries shall
be the continuing or surviving corporation);

         (b) the Borrower or any wholly owned Subsidiary of the Borrower may
sell, lease, transfer or otherwise dispose of any or all of its assets (upon
voluntary liquidation or otherwise) to the Borrower or any other wholly owned
Subsidiary, and, so long as no Default or Event of Default shall have occurred
and be continuing or would occur as a result thereof, the Borrower or any
Subsidiary of the Borrower may sell, lease, transfer or otherwise dispose of any
or all of its assets (upon voluntary liquidation or otherwise) to any non-wholly
owned Subsidiary of the Borrower for fair market value;

         (c) any non-wholly owned Subsidiary of the Borrower may sell, lease,
transfer or otherwise dispose of any or all of its assets (upon voluntary
liquidation or otherwise) to the Borrower or any wholly owned Subsidiary of the
Borrower for fair market value or may sell, lease, transfer or otherwise dispose
of any or all of its assets (upon voluntary liquidation or otherwise) to any
other non-wholly owned Subsidiary of the Borrower; and

         (d) the Borrower or any Subsidiary of the Borrower may be merged or
consolidated with or into another Person; provided that the Borrower or such
Subsidiary shall be the continuing or surviving corporation and no Default or
Event of Default shall have occurred and be continuing or would occur as a
result thereof (and, in the case of any such transaction involving a Subsidiary,
such Subsidiary shall continue to be a Subsidiary or the Borrower shall have
received fair market value therefor as determined by the Board of Directors of
the Borrower); and provided further that the Borrower may not be merged or
consolidated with or into any Subsidiary.

                                   SECTION 10
                                EVENTS OF DEFAULT

         If any of the following events shall occur and be continuing:

         (a) The Borrower shall fail to pay any principal of any Loan or any
Reimbursement Obligation when due in accordance with the terms thereof or
hereof; or the Borrower shall fail to pay any interest on any Loan, or any fee
or other amount payable hereunder, within five days

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<PAGE>

after any such interest or other amount becomes due in accordance with the terms
thereof or hereof; or

         (b) Any representation or warranty made or deemed made by the Borrower
herein or in any other Loan Document or which is contained in any certificate,
document or financial or other statement furnished by it at any time under or in
connection with this Agreement shall prove to have been incorrect in any
material respect on or as of the date made or deemed made; or

         (c)      (i) The Borrower shall default in the observance or
performance of any covenant contained in subsections 8.4(b), 8.7(a) or in
Section 9;
                  (ii) the Borrower shall default in the observance or
         performance of any agreement contained in Section 12; or

                  (iii) the Borrower shall default in the observance or
         performance of any other agreement contained in this Agreement (other
         than as provided above in this Section), and such default described in
         this clause (iii) shall continue unremedied for a period of 30 days; or

         (d) The Borrower or any of its Subsidiaries shall: (i) default in any
payment of principal of or interest of any Indebtedness (other than the Loans)
or in the payment of any Guarantee Obligation, beyond the period of grace, if
any, provided in the instrument or agreement under which such Indebtedness or
Guarantee Obligation was created; or (ii) default in the observance or
performance of any other agreement or condition relating to any such
Indebtedness or Guarantee Obligation or contained in any instrument or agreement
evidencing, securing or relating thereto, or any other event shall occur or
condition exist, the effect of which default or other event or condition is to
cause, or to permit the holder or holders of such Indebtedness or beneficiary or
beneficiaries of such Guarantee Obligation (or a trustee or agent on behalf of
such holder or holders or beneficiary or beneficiaries) to cause, with the
giving of notice if required, such Indebtedness to become due prior to its
stated maturity or such Guarantee Obligation to become payable; provided,
however, that no Default or Event of Default shall exist under this paragraph
unless the aggregate amount of Indebtedness and/or Guarantee Obligations in
respect of which any default or other event or condition referred to in this
paragraph shall have occurred shall be equal to at least $100,000,000; or

         (e) (i) The Borrower or any of its Subsidiaries shall commence any
case, proceeding or other action (A) under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief entered
with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or
seeking reorganization, arrangement, adjustment, winding-up, liquidation,
dissolution, composition or other relief with respect to it or its debts, or (B)
seeking appointment of a receiver, trustee, custodian, conservator or other
similar official for it or for all or any substantial part of its assets, or the
Borrower or any of its Subsidiaries shall make a general assignment for the
benefit of its creditors; or (ii) there shall be commenced against the Borrower
or any of its Subsidiaries any case, proceeding or other action of a nature
referred to in clause (i) above which (A) results in the entry of an order for
relief or any such adjudication or appointment or (B) remains

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<PAGE>

undismissed, undischarged or unbonded for a period of 60 days; or (iii) there
shall be commenced against the Borrower or any of its Subsidiaries any case,
proceeding or other action seeking issuance of a warrant of attachment,
execution, distraint or similar process against all or any substantial part of
its assets which results in the entry of an order for any such relief which
shall not have been vacated, discharged, or stayed or bonded pending appeal
within 60 days from the entry thereof; or (iv) the Borrower or any of its
Subsidiaries shall take any action in furtherance of, or indicating its consent
to, approval of, or acquiescence in, any of the acts set forth in clause (i),
(ii), or (iii) above; or (v) the Borrower or any of its Subsidiaries shall
generally not or shall admit in writing its inability to, pay its debts as they
become due; or

         (f) (i) Any Person shall engage in any "prohibited transaction" (as
defined in Section 406 of ERISA or Section 4975 of the Code) involving any Plan,
(ii) any "accumulated funding deficiency" (as defined in Section 302 of ERISA),
whether or not waived, shall exist with respect to any Plan or any Lien in favor
of the PBGC or a Plan shall arise on the assets of the Borrower or any Commonly
Controlled Entity, (iii) a Reportable Event shall occur with respect to, or
proceedings shall commence to have a trustee appointed, or a trustee shall be
appointed, to administer or to terminate, any Single Employer Plan, which
Reportable Event or commencement of proceedings or appointment of a trustee is
likely to result in the termination of such Plan for purposes of Title IV of
ERISA, (iv) any Single Employer Plan shall terminate for purposes of Title IV of
ERISA, (v) the Borrower or any Commonly Controlled Entity shall incur any
liability in connection with a withdrawal from, or the Insolvency or
Reorganization of, a Multiemployer Plan or (vi) any other event or condition
shall occur or exist with respect to a Plan; and in each case in clauses (i)
through (vi) above, such event or condition, together with all other such events
or conditions, if any, could reasonably be expected to have a Material Adverse
Effect; or

         (g) One or more judgments or decrees shall be entered against the
Borrower or any of its Subsidiaries involving in the aggregate a liability (not
paid or in excess of the amount recoverable by insurance) of $100,000,000 (net
of any related tax benefit) or more, and all such judgments or decrees shall not
have been vacated, discharged, stayed or bonded pending appeal within 60 days
from the entry thereof; or

         (h) (i) Any Person or "group" (within the meaning of Section 13(d) or
14(d) of the Securities Exchange Act of 1934, as amended) (A) shall have
acquired beneficial ownership of 30% or more of any outstanding class of Capital
Stock having ordinary voting power in the election of directors of the Borrower
(other than Peter M. Nicholas and John E. Abele or any of their affiliated trust
holdings) or (B) shall obtain the power (whether or not exercised) to elect a
majority of the Borrower's directors; or (ii) the Board of Directors of the
Borrower shall not consist of a majority of Continuing Directors; "Continuing
Directors" shall mean the directors of the Borrower on the Closing Date and each
other director, if such other director's nomination for election to the Board of
Directors of the Borrower is recommended by a majority of the then Continuing
Directors;

then, and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (e) above with respect to the Borrower,
automatically the Commitments shall immediately terminate and the Loans
hereunder (with accrued interest thereon) and all other amounts owing under this
Agreement and the other Loan Documents (including, without

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<PAGE>

limitation, all amounts of L/C Obligations, whether or not the beneficiaries of
the then outstanding Letters of Credit shall have presented the documents
required thereunder) shall immediately become due and payable, and (B) if such
event is any other Event of Default, either or both of the following actions may
be taken: (i) with the consent of the Majority Lenders, the Administrative Agent
may, or upon the request of the Majority Lenders, the Administrative Agent
shall, by notice to the Borrower declare the Commitments to be terminated
forthwith, whereupon the Commitments shall immediately terminate; and (ii) with
the consent of the Majority Lenders, the Administrative Agent may, or upon the
request of the Majority Lenders, the Administrative Agent shall, by notice to
the Borrower, declare the Loans hereunder (with accrued interest thereon) and
all other amounts owing under this Agreement and the other Loan Documents
(including, without limitation, all amounts of L/C Obligations, whether or not
the beneficiaries of the then outstanding Letters of Credit shall have presented
the documents required thereunder) to be due and payable forthwith, whereupon
the same shall immediately become due and payable. In the case of each Letter of
Credit with respect to which presentment for honor shall not have occurred at
the time of an acceleration pursuant to this paragraph, the Borrower shall at
such time deposit in cash collateral accounts opened by the Administrative Agent
an amount (in the currency in which such Letter of Credit is denominated) equal
to the then undrawn and unexpired amount of such Letter of Credit. Amounts held
in such cash collateral account shall be applied by the Administrative Agent to
the payment of drafts drawn under such Letters of Credit, and the unused portion
thereof after all such Letters of Credit shall have expired or been fully drawn
upon, if any, shall be applied to repay other obligations of the Borrower
hereunder and under the other Loan Documents. After all such Letters of Credit
shall have expired or been fully drawn upon, all Reimbursement Obligations shall
have been satisfied and all other obligations of the Borrower hereunder and
under the other Loan Documents shall have been paid in full (or in the event
that the acceleration that required the funding of such cash collateral account
is rescinded by the Lenders), the balance, if any, in such cash collateral
account shall be returned to the Borrower (or such other Person as may be
lawfully entitled thereto).

                                   SECTION 11
                                   THE AGENTS

         11.1  APPOINTMENT. Each Lender hereby irrevocably designates and
appoints the Administrative Agent as the agent of such Lender under this
Agreement and the other Loan Documents, and each Lender irrevocably authorizes
the Administrative Agent, in such capacity, to take such action on its behalf
under the provisions of this Agreement and the other Loan Documents and to
exercise such powers and perform such duties as are expressly delegated to the
Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Administrative Agent shall not have any duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with any Lender, and
no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Administrative Agent.

         11.2  DELEGATION OF DUTIES. The Administrative Agent may execute any of
its duties under this Agreement and the other Loan Documents by or through
agents or attorneys-in-fact

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and shall be entitled to advice of counsel concerning all matters pertaining to
such duties. The Administrative Agent shall not be responsible for the
negligence or misconduct of any agents or attorneys in-fact selected by it with
reasonable care.

         11.3 EXCULPATORY PROVISIONS. Neither any Agent nor any of its officers,
directors, employees, agents, attorneys-in-fact or Affiliates shall be (i)
liable for any action lawfully taken or omitted to be taken by it or such Person
under or in connection with this Agreement or any other Loan Document (except
for its or such Person's own gross negligence or willful misconduct) or (ii)
responsible in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by the Borrower or any officer thereof
contained in this Agreement or any other Loan Document or in any certificate,
report, statement or other document referred to or provided for in, or received
by such Agent under or in connection with, this Agreement or any other Loan
Document or for the value, validity, effectiveness, genuineness, enforceability
or sufficiency of this Agreement or any other Loan Document or for any failure
of the Borrower to perform its obligations hereunder or thereunder. No Agent
shall be under any obligation to any Lender to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement or any other Loan Document, or to inspect the properties,
books or records of the Borrower.

         11.4 RELIANCE BY ADMINISTRATIVE AGENT. The Administrative Agent shall
be entitled to rely, and shall be fully protected in relying, upon any Note,
writing, resolution, notice, consent, certificate, affidavit, letter, telecopy,
telex or teletype message, statement, order or other document or conversation
believed by it to be genuine and correct and to have been signed, sent or made
by the proper Person or Persons and upon advice and statements of legal counsel
(including, without limitation, counsel to the Borrower), independent
accountants and other experts selected by the Administrative Agent. The
Administrative Agent may deem and treat the payee of any Note as the owner
thereof for all purposes unless a written notice of assignment, negotiation or
transfer thereof shall have been filed with the Administrative Agent. The
Administrative Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the Majority Lenders as it deems
appropriate or it shall first be indemnified to its satisfaction by the Lenders
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. The Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting, under
this Agreement and the other Loan Documents in accordance with a request of the
Majority Lenders, and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders and all future holders of
the Loans.

         11.5 NOTICE OF DEFAULT. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Administrative Agent has received notice from a Lender or
the Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default". In the event that
the Administrative Agent receives such a notice, the Administrative Agent shall
give notice thereof to the Lenders. The Administrative Agent shall take such
action with respect to such Default or Event of Default as shall be reasonably
directed by the Majority Lenders; provided that unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or

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<PAGE>

refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interests of the Lenders.

         11.6 NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS. Each
Lender expressly acknowledges that neither the Administrative Agent nor any of
its officers, directors, employees, agents, attorneys-in-fact or Affiliates has
made any representations or warranties to it and that no act by the
Administrative Agent hereinafter taken, including any review of the affairs of
the Borrower, shall be deemed to constitute any representation or warranty by
the Administrative Agent to any Lender. Each Lender represents to the
Administrative Agent that 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 appraisal of and
investigation into the business, operations, property, financial and other
condition and creditworthiness of the Borrower and made its own decision to make
its Loans hereunder and enter into this Agreement. Each Lender also represents
that it will, independently and without reliance upon the Administrative Agent
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 analysis,
appraisals and decisions in taking or not taking action under this Agreement and
the other Loan Documents, and to make such investigation as it deems necessary
to inform itself as to the business, operations, property, financial and other
condition and creditworthiness of the Borrower. Except for notices, reports and
other documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall not have any duty
or responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness of the Borrower which may come into
the possession of the Administrative Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or Affiliates.

         11.7 INDEMNIFICATION. The Lenders agree to indemnify the Administrative
Agent (or sub-agent), in its capacity, any Issuing Lender, in its capacity, and
any Related Party acting for the Administrative Agent (or any sub-agent) or any
Issuing Lender in connection with such capacity (to the extent not reimbursed by
the Borrower and without limiting the obligation of the Borrower to do so),
ratably according to their respective Revolving Credit Commitment Percentages in
effect on the date on which indemnification is sought (or, if indemnification is
sought after the date upon which the Commitments shall have terminated and the
Loans shall have been paid in full, ratably in accordance with such percentages
immediately prior to such date), from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind whatsoever which may at any time
(including, without limitation, at any time following the payment of the Loans)
be imposed on, incurred by or asserted against the Administrative Agent (or any
sub-agent), any Issuing Lender or such Related Party in any way relating to or
arising out of, the Commitments, this Agreement, any of the other Loan Documents
or any documents contemplated by or referred to herein or therein or the
transactions contemplated hereby or thereby or any action taken or omitted by
the Administrative Agent (or any sub-agent), any Issuing Lender or such Related

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Party under or in connection with any of the foregoing; provided that no Lender
shall be liable for the payment of any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements which are found by a final and nonappealable decision of a court
of competent jurisdiction to have resulted from the gross negligence or willful
misconduct of the Administrative Agent (or sub-agent), any Issuing Lender or any
Related Party acting for the Administrative Agent (or any sub-agent) or any
Issuing Lender in connection with such capacity. The agreements in this
subsection shall survive the payment of the Loans and all other amounts payable
hereunder.

         11.8 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY. The
Administrative Agent and its Affiliates may make loans to, accept deposits from
and generally engage in any kind of business with the Borrower as though the
Administrative Agent were not the Administrative Agent hereunder and under the
other Loan Documents. With respect to the Loans made by it and with respect to
any Letter of Credit issued or participated in by it, the Administrative Agent
shall have the same rights and powers under this Agreement and the other Loan
Documents as any Lender and may exercise the same as though it were not the
Administrative Agent, and the terms "Lender" and "Lenders" shall include the
Administrative Agent in its individual capacity.

         11.9 SUCCESSOR ADMINISTRATIVE AGENT. The Administrative Agent may
resign as Administrative Agent upon 10 days' notice to the Lenders. If the
Administrative Agent shall resign as Administrative Agent under this Agreement
and the other Loan Documents, then the Majority Lenders shall appoint from among
the Lenders a successor agent for the Lenders, which successor agent (provided
that it shall have been approved by the Borrower), shall succeed to the rights,
powers and duties of the Administrative Agent hereunder. Effective upon such
appointment and approval, the term "Administrative Agent" shall mean such
successor agent, and the former Administrative Agent's rights, powers and duties
as Administrative Agent shall be terminated, without any other or further act or
deed on the part of such former Administrative Agent or any of the parties to
this Agreement or any holders of the Loans. After any retiring Administrative
Agent's resignation as Administrative Agent, the provisions of this Section 11
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Administrative Agent under this Agreement and the other Loan
Documents.

         11.10 THE ARRANGERS, THE BOOKRUNNERS, THE SYNDICATION AGENTS AND THE
DOCUMENTATION AGENTS. None of the Arrangers, the Bookrunners, the Syndication
Agents or the Documentation Agents shall have any right, power, obligation,
liability, responsibility or duty under this Agreement other than those
applicable to all Lenders as such. Without limiting the foregoing, none of the
Arrangers, the Bookrunners, the Syndication Agents or the Documentation Agents
shall have or be deemed to have any fiduciary relationship with any Lender. Each
Lender acknowledges that it has not relied, and will not rely, on the Arrangers,
the Bookrunners, the Syndication Agents or the Documentation Agents in deciding
to enter into this Agreement or in taking or not taking any action hereunder.

                                   SECTION 12
                                    GUARANTEE

         12.1 GUARANTEE. (a)The Borrower hereby unconditionally and irrevocably
guarantees to the Administrative Agent, for the ratable benefit of the
Administrative Agent and the Lenders and their respective successors, endorsees,
transferees and assigns, the prompt and complete payment and performance by the
Foreign Subsidiary Borrowers when due (whether at the stated maturity, by
acceleration or otherwise) of the Obligations.

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<PAGE>

         (b) No payment or payments made by the Borrower or any other Person or
received or collected by the Administrative Agent or any Lender from the
Borrower or any other Person by virtue of any action or proceeding or any
set-off or appropriation or application, at any time or from time to time, in
reduction of or in payment of the Obligations shall be deemed to modify, reduce,
release or otherwise affect the liability of the Borrower hereunder which shall,
notwithstanding any such payment or payments, remain liable hereunder for the
Obligations until the Obligations are paid in full and the Commitments are
terminated.

         (c) The Borrower agrees that whenever, at any time, or from time to
time, it shall make any payment to the Administrative Agent or any Lender on
account of its liability hereunder, it will notify the Administrative Agent and
such Lender in writing that such payment is made under this Section for such
purpose.

         12.2 NO SUBROGATION. Notwithstanding any payment or payments made by
the Borrower hereunder, or any set-off or application of funds of the Borrower
by the Administrative Agent or any Lender, the Borrower shall not be entitled to
be subrogated to any of the rights of the Administrative Agent or any Lender
against the Foreign Subsidiary Borrowers or against any collateral security or
guarantee or right of offset held by the Administrative Agent or any Lender for
the payment of the Obligations, nor shall the Borrower seek or be entitled to
seek any contribution or reimbursement from the Foreign Subsidiary Borrowers in
respect of payments made by the Borrower hereunder, until all amounts owing to
the Administrative Agent and the Local Currency Lenders by the Foreign
Subsidiary Borrowers on account of the Obligations are paid in full and the
Commitments are terminated. If any amount shall be paid to the Borrower on
account of such subrogation rights at any time when all of the Obligations shall
not have been paid in full, such amount shall be held by the Borrower in trust
for the Administrative Agent and the Lenders, segregated from other funds of the
Borrower, and shall, forthwith upon receipt by the Borrower, be turned over to
the Administrative Agent in the exact form received by the Borrower (duly
indorsed by the Borrower to the Administrative Agent, if required), to be
applied against the Obligations, whether matured or unmatured, in such order as
Administrative Agent may determine. The provisions of this paragraph shall
continue to be effective after the termination of this Agreement, the payment in
full of the Obligations and the termination of the Commitments.

         12.3 AMENDMENTS, ETC WITH RESPECT TO THE OBLIGATIONS; WAIVER OF RIGHTS.
The Borrower shall remain obligated hereunder notwithstanding that, without any
reservation of rights against the Borrower, and without notice to or further
assent by the Borrower, any demand for payment of any of the Obligations made by
the Administrative Agent or any Lender may be rescinded by the Administrative
Agent or such Lender, and any of the Obligations continued, and the Obligations,
or the liability of any other party upon or for any part thereof, or any
collateral security or guarantee therefor or right of offset with respect
thereto, may, from time to time, in whole or in part, be renewed, extended,
amended, modified, accelerated, compromised, waived, surrendered or released by
the Administrative Agent or any Lender, and any Loan Documents and any other
documents executed and delivered in connection therewith may be amended,
modified, supplemented or terminated, in whole or in part, in accordance with
the provisions thereof as the Administrative Agent (or the requisite Lenders, as
the case may be) may deem advisable from time to time, and any collateral
security, guarantee or right of offset at any time held by the Administrative
Agent or any Lender for the payment of the Obligations may be sold,

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exchanged, waived, surrendered or released. None of the Administrative Agent or
any Lender shall have any obligation to protect, secure, perfect or insure any
Lien at any time held by it as security for the Obligations or for this
Agreement or any property subject thereto. When making any demand hereunder
against the Borrower, the Administrative Agent or any Lender may, but shall be
under no obligation to, make a similar demand on the Foreign Subsidiary
Borrowers or any other guarantor, and any failure by the Administrative Agent or
any Lender to make any such demand or to collect any payments from a Foreign
Subsidiary Borrower or any such other guarantor or any release of a Foreign
Subsidiary Borrower or such other guarantor shall not relieve the Borrower of
its obligations or liabilities hereunder, and shall not impair or affect the
rights and remedies, express or implied, or as a matter of law, of the
Administrative Agent or any Lender against the Borrower. For the purposes hereof
"demand" shall include the commencement and continuance of any legal
proceedings.

         12.4 GUARANTEE ABSOLUTE AND UNCONDITIONAL. The Borrower waives any and
all notice of the creation, renewal, extension or accrual of any of the
Obligations and notice of or proof of reliance by the Administrative Agent or
any Lender upon this Agreement or acceptance of this Agreement; the Obligations,
and any of them, shall conclusively be deemed to have been created, contracted
or incurred, or renewed, extended, amended or waived, in reliance upon this
Agreement; and all dealings between the Foreign Subsidiary Borrowers and the
Borrower, on the one hand, and the Administrative Agent and the Lenders, on the
other, shall likewise be conclusively presumed to have been had or consummated
in reliance upon this Agreement. The Borrower waives diligence, presentment,
protest, demand for payment and notice of default or nonpayment to or upon the
Foreign Subsidiary Borrowers and the Borrower with respect to the Obligations.
This Section 12 shall be construed as a continuing, absolute and unconditional
guarantee of payment without regard to (a) the validity, regularity or
enforceability of this Agreement, any other Loan Document, any of the
Obligations or any other collateral security therefor or guarantee or right of
offset with respect thereto at any time or from time to time held by the
Administrative Agent or any Lender, (b) any defense, set-off or counterclaim
(other than a defense of payment or performance) which may at any time be
available to or be asserted by the Foreign Subsidiary Borrowers against the
Administrative Agent or any Lender, (c) any law, regulation, decree or order of
any jurisdiction, or any other event, affecting the Obligations or any Lender's
rights with respect thereto, including, without limitation: (i) the application
of any such law, regulation, decree or order, including any prior approval, that
would prevent the exchange of a non-Dollar currency for Dollars or the
remittance of funds outside of such jurisdiction or the unavailability of
Dollars in any legal exchange market in such jurisdiction in accordance with
normal commercial practice; or (ii) a declaration of banking moratorium or any
suspension of payments by banks in such jurisdiction or the imposition by such
jurisdiction or any governmental authority thereof of any moratorium on the
required rescheduling or restructuring of, or required approval of payments on,
any indebtedness in such jurisdiction; or (iii) any expropriation, confiscation,
nationalization or requisition by such country or any governmental authority
that directly or indirectly deprives the companies in such jurisdiction of any
payment obligation under the Obligations; or (iv) any war (whether or not
declared), insurrection, revolution, hostile act, civil strife or similar events
occurring in such jurisdiction that has the same effect as the events described
in clause (i), (ii) or (iii) above (in each of the cases contemplated in clauses
(i) through (iv) above, to the extent occurring or existing on or at any time
after the date of this Agreement), or (d) any other circumstance whatsoever
(with or without notice to or knowledge of the Foreign Subsidiary Borrowers or
the Borrower) which

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<PAGE>

constitutes, or might be construed to constitute, an equitable or legal
discharge of the Foreign Subsidiary Borrowers for the Obligations, or of the
Borrower under this Section 12, in bankruptcy or in any other instance. When
pursuing its rights and remedies hereunder against the Borrower, the
Administrative Agent and any Lender may, but shall be under no obligation to,
pursue such rights and remedies as it may have against the Foreign Subsidiary
Borrowers or any other Person or against any collateral security or guarantee
for the Obligations or any right of offset with respect thereto, and any failure
by the Administrative Agent or any Lender to pursue such other rights or
remedies or to collect any payments from the Borrower or any such other Person
or to realize upon any such collateral security or guarantee or to exercise any
such right of offset, or any release of the Foreign Subsidiary Borrowers or any
such other Person or of any such collateral security, guarantee or right of
offset, shall not relieve the Borrower of any liability hereunder, and shall not
impair or affect the rights and remedies, whether express, implied or available
as a matter of law, of the Administrative Agent or any Lender against the
Borrower. This Section 12 shall remain in full force and effect and be binding
in accordance with and to the extent of its terms upon the Borrower and its
successors and assigns, and shall inure to the benefit of the Administrative
Agent and the Lenders, and their respective successors, endorsees, transferees
and assigns, until all the Obligations and the obligations of the Borrower under
this Agreement shall have been satisfied by payment in full and the Commitments
shall be terminated, notwithstanding that from time to time during the term of
this Agreement the Foreign Subsidiary Borrowers may be free from any
Obligations.

         12.5 REINSTATEMENT. This Section 12 shall continue to be effective, or
be reinstated, as the case may be, if at any time payment, or any part thereof,
of any of the Obligations is rescinded or must otherwise be restored or returned
by the Administrative Agent or any Lender upon the insolvency, bankruptcy,
dissolution, liquidation or reorganization of the Borrower or upon or as a
result of the appointment of a receiver, intervenor or conservator of, or
trustee or similar officer for, the Borrower or any substantial part of its
property, or otherwise, all as though such payments had not been made.

         12.6 PAYMENTS. The Borrower hereby agrees that all payments required to
be made by it hereunder will be made to the Administrative Agent without set-off
or counterclaim in accordance with the terms of the Obligations, including,
without limitation, in the currency in which payment is due, provided that if a
payment is due in a currency other than Dollars and/or at a place other than the
United States, and such payment is not made as and when agreed, the Borrower
will, upon the Administrative Agent's request, either (i) make payment in such
non- Dollar currency and at the place where such payment is payable or (ii) pay
the Administrative Agent in Dollars at 270 Park Avenue, New York, New York. In
the event of a payment pursuant to clause (ii) above, the Borrower will pay the
Administrative Agent the Dollar Equivalent of the amount of such payment on the
date the Borrower makes such payment.

         12.7 "LENDERS". For all purposes of this Section 12, the term "Lenders"
shall be deemed to include Local Currency Lenders.

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                                   SECTION 13
                                  MISCELLANEOUS

         13.1 AMENDMENTS AND WAIVERS. (a) Except as provided in paragraphs (b)
and (c) of this subsection 13.1, neither this Agreement nor any other Loan
Document, nor any terms hereof or thereof may be amended, supplemented or
modified except in accordance with the provisions of this subsection. The
Majority Lenders may, or, with the written consent of the Majority Lenders, the
Administrative Agent may, from time to time, (a) enter into with the Borrower
written amendments, supplements or modifications hereto and to the other Loan
Documents for the purpose of adding any provisions to this Agreement or the
other Loan Documents or changing in any manner the rights of the Lenders or of
the Borrower hereunder or thereunder or (b) waive, on such terms and conditions
as the Majority Lenders or the Administrative Agent, as the case may be, may
specify in such instrument, any of the requirements of this Agreement or the
other Loan Documents or any Default or Event of Default and its consequences;
provided, however, that no such waiver and no such amendment, supplement or
modification shall (i) reduce the amount or extend the scheduled date of
maturity of any Loan, or reduce the stated rate or amount of any interest or fee
payable hereunder or extend the scheduled date of any payment thereof or
increase the amount or extend the expiration date of any Lender's Multicurrency
Commitment, Revolving Credit Commitment, Swingline Commitment or L/C Commitment
or modify the pro rata distribution of payments, proceeds or fees payable to the
Lenders, in each case without the consent of each Lender affected thereby, or
(ii) amend, modify or waive any provision of this subsection or reduce the
percentages specified in the definitions, of Majority Lenders or Majority
Multicurrency Lenders, or consent to the assignment or transfer by the Borrower
of any of its rights and obligations under this Agreement and the other Loan
Documents or release, subordinate or otherwise materially limit the Borrower's
liability with respect to the guarantee set forth in Section 12, in each case
without the written consent of all the Lenders, or (iii) amend, modify or waive
any provision of Section 11 without the written consent of the then
Administrative Agent. Any such waiver and any such amendment, supplement or
modification shall apply equally to each of the Lenders and shall be binding
upon the Borrower, the Lenders, the Administrative Agent and all future holders
of the Loans. In the case of any waiver, the Borrower, the Lenders and the
Administrative Agent shall be restored to their former positions and rights
hereunder and under the other Loan Documents, and any Default or Event of
Default waived shall be deemed to be cured and not continuing; no such waiver
shall extend to any subsequent or other Default or Event of Default or impair
any right consequent thereon.

         (b) In addition to amendments effected pursuant to the foregoing
paragraph (a), (i) Schedule II may be amended to change administrative
information contained therein with the approval of the Majority Multicurrency
Lenders, upon execution and delivery by the Borrower and the Administrative
Agent of a written amendment providing for such amendment and (ii) additional
freely-convertible euro currencies may be added as Available Foreign Currencies,
upon execution and delivery by the Borrower, the Administrative Agent and the
Majority Multicurrency Lenders of an amendment providing for such addition.

         (c) The Administrative Agent shall give prompt written notice to each
Lender of any amendment effected pursuant to subsection 13.1(b).

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<PAGE>

         (d) Notwithstanding the provisions of this subsection 13.1, any Local
Currency Facility may be amended, supplemented or otherwise modified in
accordance with its terms so long as after giving effect thereto either (x) such
Local Currency Facility ceases to be an "Local Currency Facility" and the
Borrower so notifies the Administrative Agent or (y) the Local Currency Facility
continues to meet the requirements of a Local Currency Facility set forth
herein.

         13.2 NOTICES. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
facsimile transmission) and, unless otherwise expressly provided herein, shall
be deemed to have been duly given or made (a) in the case of delivery by hand,
when delivered, (b) in the case of delivery by mail, three days after being
deposited in the mails, postage prepaid, or (c) in the case of delivery by
facsimile transmission, when sent and receipt has been confirmed, addressed as
follows in the case of the Borrower and the Administrative Agent, and as set
forth in Schedule I in the case of the other parties hereto, or to such other
address as may be hereafter notified by the respective parties hereto:

         The Borrower:

                           Boston Scientific Corporation
                           One Boston Scientific Place
                           Natick, Massachusetts 01760
                           Attention: Lawrence C. Best
                           Senior Vice President, Finance & Administration
                           and Chief Financial Officer
                           Fax: 508-650-8951

         with a copy to:

                           Paul Sandman
                           Senior Vice President, General Counsel
                           Fax: 508-650-8960

         The Administrative Agent:

                           JPMorgan Chase Bank
                           Loan & Agency Services Group
                           1111 Fannin, Floor 10
                           Houston, Texas 77002
                           Attention: Vikki Toler/Jennifer Anyigbo
                           Fax: (713) 750-2949/2782



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<PAGE>

         with a copy to:

                           JPMorgan Chase Bank
                           270 Park Avenue
                           New York, New York 10017
                           Attention: Dawn Lee Lum
                           Fax: 212-270-5100

         provided that any notice, request or demand to or upon the
Administrative Agent or the Lenders pursuant to subsection 2.2, 2.6, 2.9, 2.14,
2.15, or 3.2 shall not be effective until received.

         13.3 NO WAIVER; CUMULATIVE REMEDIES. No failure to exercise and no
delay in exercising, on the part of the Administrative Agent or any Lender, any
right, remedy, power or privilege hereunder or under the other Loan Documents
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges herein provided are cumulative and
not exclusive of any rights, remedies, powers and privileges provided by law.

         13.4 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties made hereunder, in the other Loan Documents and in any document,
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Agreement and the making of the
Loans hereunder.

         13.5 PAYMENT OF EXPENSES AND TAXES. The Borrower agrees (a) to pay or
reimburse the Administrative Agent for all its reasonable out-of-pocket costs
and expenses incurred in connection with the development, preparation and
execution of, and any amendment, supplement or modification to, this Agreement
and the other Loan Documents and any other documents prepared in connection
herewith or therewith, and the consummation and administration of the
transactions contemplated hereby and thereby, including, without limitation, the
reasonable fees and disbursements of counsel to the Administrative Agent, (b) to
pay or reimburse each Lender and the Administrative Agent for all its costs and
expenses incurred in connection with the enforcement or preservation of any
rights under this Agreement, the other Loan Documents and any such other
documents, including, without limitation, the fees and disbursements of counsel
(including the allocated fees and expenses of in-house counsel) to each Lender
and of counsel to the Administrative Agent, provided, that in connection with
any workout or restructuring, the Borrower shall pay the fees and disbursements
of (i) one counsel for the Administrative Agent and the Lenders pursuant to this
clause (b) and (ii) one counsel to the Administrative Agent and the Lenders in
the jurisdiction of each Foreign Subsidiary Borrower pursuant to this clause
(b), (c) to pay, indemnify, and hold each Lender and the Administrative Agent
and each of their affiliates and their respective officer, directors, employees,
agents and advisors (each, an "indemnified party") harmless from, any and all
recording and filing fees and any and all liabilities with respect to, or
resulting from any delay in paying, stamp, excise and other taxes, if any, which
may be payable or determined to be payable in connection with the execution and
delivery of, or consummation or administration of any of the transactions
contemplated by, or any amendment, supplement or modification of, or any waiver
or consent under or in respect of,

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this Agreement, the other Loan Documents and any such other documents, and (d)
to pay, indemnify, and hold each indemnified party harmless from and against any
and all other liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever with respect to the execution, delivery, enforcement, performance and
administration of this Agreement, the other Loan Documents and such other
documents, including, without limitation, any of the foregoing relating to the
violation of, noncompliance with or liability under, any Environmental Law
applicable to the operations of the Borrower, any of its Subsidiaries or any of
the Properties (all the foregoing in this clause (d), collectively, the
"indemnified liabilities"), provided that the Borrower shall have no obligation
hereunder to any indemnified party with respect to indemnified liabilities
arising from the gross negligence or willful misconduct of such indemnified
party determined in a court of competent jurisdiction in a final non-appealable
judgment. The agreements in this subsection shall survive repayment of the Loans
and all other amounts payable hereunder.

         13.6 SUCCESSORS AND ASSIGNS; PARTICIPATIONS AND ASSIGNMENTS.

         (a) This Agreement shall be binding upon and inure to the benefit of
the Borrower, the Lenders, the Administrative Agent and their respective
successors and assigns, except that no Borrower may assign or transfer any of
its rights or obligations under this Agreement without the prior written consent
of each Lender.

         (b) Any Lender, other than a Conduit Lender, may, in the ordinary
course of its commercial banking business and in accordance with applicable law,
at any time sell to one or more banks or other entities ("Participants")
participating interests in any Loan owing to such Lender, any Commitment of such
Lender or any other interest of such Lender hereunder and under the other Loan
Documents. In the event of any such sale by a Lender of a participating interest
to a Participant, such Lender's obligations under this Agreement to the other
parties to this Agreement shall remain unchanged, such Lender shall remain
solely responsible for the performance thereof, such Lender shall remain the
holder of any such Loan for all purposes under this Agreement and the other Loan
Documents, and the Borrower and the Administrative Agent shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement and the other Loan Documents. No Lender shall
be entitled to create in favor of any Participant, in the participation
agreement pursuant to which such Participant's participating interest shall be
created or otherwise, any right to vote on, consent to or approve any matter
relating to this Agreement or any other Loan Document except for those specified
in clauses (i) and (ii) of the proviso to subsection 13.1(a). The Borrower
agrees that if amounts outstanding under this Agreement are due or unpaid, or
shall have been declared or shall have become due and payable upon the
occurrence of an Event of Default, each Participant shall, to the maximum extent
permitted by applicable law, be deemed to have the right of setoff in respect of
its participating interest in amounts owing under this Agreement to the same
extent as if the amount of its participating interest were owing directly to it
as a Lender under this Agreement, provided that, in purchasing such
participating interest, such Participant shall be deemed to have agreed to share
with the Lenders the proceeds thereof as provided in subsection 13.7(a) as fully
as if it were a Lender hereunder. The Borrower also agrees that each Participant
shall be entitled to the benefits of subsections 3.9, 3.10 and 3.11 with respect
to its participation in the Commitments and the Loans outstanding from time to
time as if it was a Lender; provided that, in the case of subsection 3.10, such
Participant shall have complied with

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<PAGE>

the requirements of said subsection and provided, further, that no Participant
shall be entitled to receive any greater amount pursuant to any such subsection
than the transferor Lender would have been entitled to receive in respect of the
amount of the participation transferred by such transferor Lender to such
Participant had no such transfer occurred.

         (c) Any Lender, other than a Conduit Lender, may, in the ordinary
course of its commercial banking business and in accordance with applicable law,
at any time and from time to time, assign to any Lender or any Lender Affiliate
with the consent (in each case, not to be unreasonably withheld) of the
Administrative Agent, the Issuing Lender and, except for assignments to any
Lender or Lender Affiliate of comparable credit worthiness, the Borrower, or
with the consent of the Borrower (unless a Default or an Event of Default shall
have occurred and be continuing), the Administrative Agent and Issuing Lender
(which consent in each case shall not be unreasonably withheld), to an
additional bank, financial institution, or other entity (an "Assignee") all or
any part of its rights and obligations under this Agreement and the other Loan
Documents pursuant to an Assignment and Acceptance, substantially in the form of
Exhibit H, executed by such Assignee, such assigning Lender (and, in the case of
an Assignee that is not then a Lender or a Lender Affiliate of comparable credit
worthiness, by the Borrower, the Administrative Agent and the Issuing Lender,
and, in the case of an Assignee that is a Lender or a Lender Affiliate, by the
Administrative Agent and the Issuing Lender) and delivered to the Administrative
Agent for its acceptance and recording in the Register, provided that, in the
case of any such assignment to an additional bank, financial institution or
other entity, the sum of the aggregate principal amount of the Loans and the
aggregate amount of the unused Revolving Credit Commitment being assigned shall
be not less than $5,000,000 and, if such assignment is of less than all of the
rights and obligations of the assigning Lender, the sum of the aggregate
principal amount of the Revolving Credit Loans and the aggregate amount of the
unused Revolving Credit Commitment remaining with the assigning Lender shall be
not less than $10,000,000 (or such lesser amount as may be agreed to by the
Borrower and the Administrative Agent). Upon such execution, delivery,
acceptance and recording, from and after the effective date determined pursuant
to such Assignment and Acceptance, (x) the Assignee thereunder shall be a party
hereto and, to the extent provided in such Assignment and Acceptance, have the
rights and obligations of a Lender hereunder with Commitments as set forth
therein, and (y) the assigning Lender thereunder shall, to the extent provided
in such Assignment and Acceptance, be released from its obligations under this
Agreement (and, in the case of an Assignment and Acceptance covering all or the
remaining portion of an assigning Lender's rights and obligations under this
Agreement, such assigning Lender shall cease to be a party hereto). Each
assignment by a Lender of any portion of its Revolving Credit Commitment shall
be accompanied by assignment by such Lender to the same Assignee of the same
percentage of such Lender's Multicurrency Commitment. Notwithstanding the
foregoing, any Conduit Lender may assign at any time to its designating Lender
hereunder without the consent of the Borrower or the Administrative Agent any or
all of the Loans it may have funded hereunder and pursuant to its designation
agreement and without regard to the limitations set forth in the first sentence
of this subsection 13.6(c).

         (d) The Administrative Agent, on behalf of the Borrower, shall maintain
at the address of the Administrative Agent referred to in subsection 13.2 a copy
of each Assignment and Acceptance delivered to it and a register (the
"Register") for the recordation of the names and addresses of the Lenders and
the Commitments of, and principal amount of the Loans owing

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<PAGE>

to, each Lender from time to time. The entries in the Register shall be
conclusive, in the absence of manifest error, and the Borrower, the
Administrative Agent and the Lenders may (and, in the case of any Loan or other
obligation hereunder not evidenced by a Note, shall) treat each Person whose
name is recorded in the Register as the owner of a Loan or other obligation
hereunder as the owner thereof for all purposes of this Agreement and the other
Loan Documents, notwithstanding any notice to the contrary. Any assignment of
any Loan or other obligation hereunder not evidenced by a Note shall be
effective only upon appropriate entries with respect thereto being made in the
Register. The Register shall be available for inspection by the Borrower or any
Lender at any reasonable time and from time to time upon reasonable prior
notice.

         (e) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender and an Assignee (and, in the case of an Assignee that is not
then a Lender or a Lender Affiliate, by the Borrower (if required) and the
Administrative Agent) together with payment to the Administrative Agent of a
registration and processing fee of $4,000, the Administrative Agent shall (i)
promptly accept such Assignment and Acceptance and (ii) on the effective date
determined pursuant thereto record the information contained therein in the
Register and give notice of such acceptance and recordation to the Lenders and
the Borrower.

         (f) The Borrower authorizes each Lender to disclose to any Participant
or Assignee (each, a "Transferee") and any prospective Transferee, subject to
the provisions of subsection 13.14, any and all financial information in such
Lender's possession concerning the Borrower and its Affiliates which has been
delivered to such Lender by or on behalf of the Borrower pursuant to this
Agreement or which has been delivered to such Lender by or on behalf of the
Borrower in connection with such Lender's credit evaluation of such Borrower and
its Affiliates prior to becoming a party to this Agreement.

         (g) For avoidance of doubt, the parties to this Agreement acknowledge
that the provisions of this subsection concerning assignments of Loans and Notes
relate only to absolute assignments and that such provisions do not prohibit
assignments creating security interests, including, without limitation, any
pledge or assignment by a Lender of any Loan or Note to any Federal Reserve Bank
in accordance with applicable law.

         13.7 ADJUSTMENTS; SET-OFF. (a) If any Lender (a "benefited Lender")
shall at any time receive any payment of all or part of its Loans or the
Reimbursement Obligations owing to it (or any participation therein arising
pursuant to subsection 13.15) then due and owing, or interest thereon, or
receive any collateral in respect thereof (whether voluntarily or involuntarily,
by set-off, pursuant to events or proceedings of the nature referred to in
subsection 10(e), or otherwise), in a greater proportion than any such payment
to or collateral received by any other Lender (other than to the extent
expressly provided herein), if any, in respect of such other Lender's Loans or
the Reimbursement Obligations owing to it (or any participation therein arising
pursuant to subsection 13.15) then due and owing, or interest thereon, such
benefited Lender shall purchase for cash from the other Lenders a participating
interest in such portion of each such other Lender's Loan or the Reimbursement
Obligations owing to it, or shall provide such other Lenders with the benefits
of any such collateral, or the proceeds thereof, as shall be necessary to cause
such benefited Lender to share the excess payment or benefits of such collateral
or proceeds ratably with each of the Lenders; provided, however, that if all or

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any portion of such excess payment or benefits is thereafter recovered from such
benefited Lender, such purchase shall be rescinded, and the purchase price and
benefits returned, to the extent of such recovery, but without interest.

         (b) In addition to any rights and remedies of the Lenders provided by
law, each Lender shall have the right, without prior notice to the Borrower, any
such notice being expressly waived by the Borrower to the extent permitted by
applicable law, upon any amount becoming due and payable by the Borrower
hereunder (whether at the stated maturity, by acceleration or otherwise) to
set-off and appropriate and apply against such amount any and all deposits
(general or special, time or demand, provisional or final), in any currency, and
any other credits, indebtedness or claims, in any currency, in each case whether
direct or indirect, absolute or contingent, matured or unmatured, at any time
held or owing by such Lender or any Affiliate, branch or agency thereof to or
for the credit or the account of the Borrower. Each Lender agrees promptly to
notify the Borrower and the Administrative Agent after any such set-off and
application made by such Lender, provided that the failure to give such notice
shall not affect the validity of such set-off and application.

         13.8 COUNTERPARTS. This Agreement may be executed by one or more of the
parties to this Agreement on any number of separate counterparts (including by
facsimile transmission), and all of said counterparts taken together shall be
deemed to constitute one and the same instrument. A set of the copies of this
Agreement signed by all the parties shall be lodged with the Borrower and the
Administrative Agent.

         13.9 SEVERABILITY. Any provision of this Agreement which 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 not invalidate or render
unenforceable such provision in any other jurisdiction.

         13.10 INTEGRATION. This Agreement and the other Loan Documents
represent the agreement of the Borrower, the Administrative Agent and the
Lenders with respect to the subject matter hereof, and there are no promises,
undertakings, representations or warranties by the Administrative Agent or any
Lender relative to subject matter hereof not expressly set forth or referred to
herein or in the other Loan Documents.

         13.11 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

         13.12 SUBMISSION TO JURISDICTION; WAIVERS. The Borrower hereby
irrevocably and unconditionally:

         (a) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Loan Documents to which it
is a party, or for recognition and enforcement of any judgment in respect
thereof, to the non-exclusive general jurisdiction of the

                                       74
<PAGE>

Courts of the State of New York, the courts of the United States of America for
the Southern District of New York, and appellate courts from any thereof;

         (b) consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;

         (c) agrees that service of process in any such action or proceeding may
be effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to the Borrower at its
address set forth in subsection 13.2 or at such other address of which the
Administrative Agent shall have been notified pursuant thereto;

         (d) agrees that nothing herein shall affect the right to effect service
of process in any other manner permitted by law or shall limit the right to sue
in any other jurisdiction; and

         (e) waives, to the maximum extent not prohibited by law, any right it
may have to claim or recover in any legal action or proceeding referred to in
this subsection any special, exemplary, punitive or consequential damages.

         13.13 ACKNOWLEDGEMENTS. The Borrower hereby acknowledges that:

         (a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents;

         (b) neither the Administrative Agent nor any Lender has any fiduciary
relationship with or duty to the Borrower arising out of or in connection with
this Agreement or any of the other Loan Documents, and the relationship between
the Administrative Agent and Lenders, on the one hand, and the Borrower, on the
other hand, in connection herewith or therewith is solely that of debtor and
creditor; and

         (c) no joint venture is created hereby or by the other Loan Documents
or otherwise exists by virtue of the transactions contemplated hereby among the
Lenders or among the Borrower and the Lenders.

         13.14 CONFIDENTIALITY. Each Lender agrees to keep confidential any
written or oral information (a) provided to it by or on behalf of the Borrower
or any of its Subsidiaries pursuant to or in connection with this Agreement or
(b) obtained by such Lender based on a review of the books and records of the
Borrower or any of its Subsidiaries; provided that nothing herein shall prevent
any Lender from disclosing any such information (i) to the Administrative Agent,
the Issuing Lender or any other Lender, (ii) to any Transferee or prospective
Transferee which receives such information having been made aware of the
confidential nature thereof and having agreed to abide by the provisions of this
subsection 13.14, (iii) to its employees, directors, agents, attorneys,
accountants and other professional advisors, and to employees and officers of
its Affiliates who agree to be bound by the provisions of this subsection 13.14
and who have a need for such information in connection with this Agreement or
other transactions or proposed transactions with the Borrower, (iv) upon the
request or demand of any Governmental Authority having jurisdiction over such
Lender, (v) in response to any order of any court or other

                                       75
<PAGE>

Governmental Authority or as may otherwise be required pursuant to any
Requirement of Law, (vi) subject to an agreement to comply with the provisions
of this subsection, to any actual or prospective counter-party (or its advisors)
to any Hedge Agreement, (vii) which has been publicly disclosed other than in
breach of this Agreement, or (viii) in connection with the exercise of any
remedy hereunder.

         13.15 LOAN CONVERSION/PARTICIPATIONS. (a) (i) On any Conversion Date,
to the extent not otherwise prohibited by a Requirement of Law or otherwise, all
Loans (other than CAF Advances) outstanding in any currency other than Dollars
("Loans to be Converted") shall be converted into Revolving Credit Loans
denominated in Dollars (calculated on the basis of the relevant Exchange Rates
as of the Business Day immediately preceding the Conversion Date) ("Converted
Loans") and (ii) on the Conversion Date (with respect to Loans described in the
foregoing clause (i)) (A) each Lender severally, unconditionally and irrevocably
agrees that it shall purchase in Dollars a participating interest in such
Converted Loans in an amount equal to its Conversion Sharing Percentage of the
outstanding principal amount of the Converted Loans and (B) to the extent
necessary to cause the Committed Outstandings Percentage of each Lender to equal
its Revolving Credit Commitment Percentage (calculated immediately prior to the
termination or expiration of the Revolving Credit Commitments), each Lender
severally, unconditionally and irrevocably agrees that it shall purchase or sell
a participating interest in Revolving Credit Loans then outstanding. Each Lender
will immediately transfer to the Administrative Agent, in immediately available
funds, the amounts of its participation(s), and the proceeds of such
participation(s) shall be distributed by the Administrative Agent to each Lender
from which a participating interest is being purchased in the amount(s) provided
for in the preceding sentence. All Converted Loans shall bear interest at the
rate which would otherwise be applicable to ABR Loans.

         (b) If, for any reason, the Loans to be Converted may not be converted
into Dollars in the manner contemplated by paragraph (a) of this subsection
13.15, (i) effective on such Conversion Date, each Lender severally,
unconditionally and irrevocably agrees that it shall purchase a participating
interest in such Loans to be Converted, as the case may be, in an amount equal
to its Conversion Sharing Percentage of such Loans to be Converted, and (ii)
each Lender shall purchase or sell participating interests as provided in
paragraph (a)(ii)(B) of this subsection 13.15. Each Lender will immediately
transfer to the appropriate Administrative Agent, in immediately available
funds, the amount(s) of its participation(s), and the proceeds of such
participation(s) shall be distributed by the Administrative Agent to each
relevant Lender in the amount(s) provided for in the preceding sentence.

         (c) To the extent any Non-Excluded Taxes are required to be withheld
from any amounts payable by a Lender to another Lender in connection with its
participating interest in any Converted Loan, the Borrower shall be required to
pay increased amounts to the Lender receiving such payments to the same extent
they would be required under subsection 3.10 if the Borrower were making
payments directly to such Lender.

         (d) Any time after the actions contemplated by paragraph (a) or (b) of
this subsection 13.15 have been taken, upon the notice of any Lender to the
Borrower the following shall occur: (i) the Borrower (through the guarantee
contained in Section 12) shall automatically be deemed to have assumed the Local
Currency Loans which are Converted Loans in which such Lender

                                       76
<PAGE>

holds a participation, and (ii) such Local Currency Loans shall be assigned by
the relevant Lender holding such Local Currency Loans or obligations to the
Lender who gave the notice requesting such assumption by the Borrower.

         13.16 JUDGMENT. (a) If for the purpose of obtaining judgment in any
court it is necessary to convert a sum due hereunder in one currency into
another currency, the parties hereto agree, to the fullest extent that they may
effectively do so, that the rate of exchange used shall be that at which in
accordance with normal banking procedures the Administrative Agent could
purchase the first currency with such other currency in the city in which it
normally conducts its foreign exchange operation for the first currency on the
Business Day preceding the day on which final judgment is given.

         (b) The obligation of the Borrower in respect of any sum due from it to
any Lender hereunder shall, notwithstanding any judgment in a currency (the
"Judgment Currency") other than that in which such sum is denominated in
accordance with the applicable provisions of this Agreement (the "Agreement
Currency"), be discharged only to the extent that on the Business Day following
receipt by such Lender of any sum adjudged to be so due in the Judgment Currency
such Lender may in accordance with normal banking procedures purchase the
Agreement Currency with the Judgment Currency; if the amount of Agreement
Currency so purchased is less than the sum originally due to such Lender in the
Agreement Currency, the Borrower agrees notwithstanding any such judgment to
indemnify such Lender against such loss, and if the amount of the Agreement
Currency so purchased exceeds the sum originally due to any Lender, such Lender
agrees to remit to the Borrower such excess.

         13.17 WAIVERS OF JURY TRIAL. THE BORROWER, THE ADMINISTRATIVE AGENT AND
THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY
LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT
AND FOR ANY COUNTERCLAIM THEREIN.

         13.18 USA PATRIOT ACT NOTICE. Each Lender 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 "Patriot 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 Patriot Act.


                                       77
<PAGE>

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

                                     BOSTON SCIENTIFIC CORPORATION


                                     By: _________________________________
                                     Name:
                                     Title:



                                     JPMORGAN CHASE BANK,
                                     as Administrative Agent and as a Lender


                                     By: _________________________________
                                     Name:
                                     Title:



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


                                     By: _________________________________
                                     Name:
                                     Title:



                                     WACHOVIA BANK, NATIONAL ASSOCIATION,
                                     as Syndication Agent and as a Lender

                                     By: _________________________________
                                     Name:
                                     Title:



                                     ABN AMRO BANK N.V.,
                                     as Documentation Agent and as a Lender

                                     By: _________________________________
                                     Name:
                                     Title:

<PAGE>

                                     CITICORP USA, INC.,
                                     as Documentation Agent and as a Lender

                                     By: _________________________________
                                     Name:
                                     Title:



                                     DEUTSCHE BANK AG NEW YORK BRANCH,
                                     as Documentation Agent and as a Lender

                                     By: _________________________________
                                     Name:
                                     Title:



                                     SUMITOMO MITSUI BANKING CORPORATION,
                                     as Documentation Agent and as a Lender

                                     By: _________________________________
                                     Name:
                                     Title:



                                     THE BANK OF TOKYO-MITSUBISHI, LTD.,
                                     NEW YORK BRANCH,
                                     as Documentation Agent and as a Lender

                                     By: _________________________________
                                     Name:
                                     Title:



                                     MERRILL LYNCH BANK USA,
                                     as a Lender

                                     By: _________________________________
                                     Name:
                                     Title:

<PAGE>

                                     BNP PARIBAS,
                                     as a Lender

                                     By: _________________________________
                                     Name:
                                     Title:



                                     By: _________________________________
                                     Name:
                                     Title:



                                     ALLIED IRISH BANKS PLC,
                                     as a Lender

                                     By: _________________________________
                                     Name:
                                     Title:



                                     CITIZENS BANK OF MASSACHUSETTS,
                                     as a Lender

                                     By: _________________________________
                                     Name:
                                     Title:



                                     STANDARD CHARTERED BANK,
                                     as a Lender

                                     By: _________________________________
                                     Name:
                                     Title:



                                     BANCO BILBAO VIZCAYA ARGENTARIA S.A.,
                                     NEW YORK BRANCH,
                                     as a Lender

                                     By: _________________________________
                                     Name:
                                     Title:

<PAGE>

                                     KEYBANK NATIONAL ASSOCIATION,
                                     as a Lender

                                     By: _________________________________
                                     Name:
                                     Title:



                                     MIZUHO CORPORATE BANK, LTD.,
                                     as a Lender

                                     By: _________________________________
                                     Name:
                                     Title:



                                     MELLON BANK, N.A.,
                                     as a Lender

                                     By: _________________________________
                                     Name:
                                     Title:



                                     BANCA INTESA, NEW YORK BRANCH,
                                     as a Lender

                                     By: _________________________________
                                     Name:
                                     Title:



                                     THE BANK OF NEW YORK,
                                     as a Lender

                                     By: _________________________________
                                     Name:
                                     Title:



                                     U.S. BANK, NATIONAL
                                     ASSOCIATION, as a Lender

                                     By: _________________________________
                                     Name:
                                     Title:

<PAGE>


                                     SVENSKA HANDELSBANKEN AB,
                                     as a Lender

                                     By: _________________________________
                                     Name:
                                     Title:


                                     By: _________________________________
                                     Name:
                                     Title:




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.3
<SEQUENCE>4
<FILENAME>exhibit10-3_12848.txt
<DESCRIPTION>364-DAY REVOLVING CREDIT AGREEMENT
<TEXT>
                                                                    EXHIBIT 10.3
                                                                    ------------
================================================================================

                                     FORM OF

                                  $500,000,000

                       364-DAY REVOLVING CREDIT AGREEMENT

                                      among

                         BOSTON SCIENTIFIC CORPORATION,
                                   AS BORROWER


                               THE SEVERAL LENDERS
                        FROM TIME TO TIME PARTIES HERETO,


                              BANK OF AMERICA, N.A.

                                       and

                      WACHOVIA BANK, NATIONAL ASSOCIATION,
                             AS SYNDICATION AGENTS,


                               ABN AMRO BANK N.V.,
                               CITICORP USA, INC.,
                        DEUTSCHE BANK AG NEW YORK BRANCH,
                    SUMITOMO MITSUI BANKING CORPORATION, AND
                THE BANK OF TOKYO-MITSUBISH LTD., NEW YORK BRANCH
                            AS DOCUMENTATION AGENTS,

                         BANC OF AMERICA SECURITIES LLC
                                       AND
                          J.P. MORGAN SECURITIES INC.,
                 AS JOINT LEAD ARRANGERS AND JOINT BOOKRUNNERS,

                                  BNP PARIBAS,
                                       AND
                             MERRILL LYNCH BANK USA,
                               AS MANAGING AGENTS

                                       and


                              JPMORGAN CHASE BANK,
                             AS ADMINISTRATIVE AGENT

                            DATED AS OF MAY 14, 2004

================================================================================
<PAGE>

                                TABLE OF CONTENTS
                                   (continued)
                                                                            PAGE

                                TABLE OF CONTENTS


SECTION 1       DEFINITIONS...................................................1

            1.1         Defined Terms.........................................1

            1.2         Other Definitional Provisions........................16

SECTION 2       AMOUNT AND TERMS OF COMMITMENTS..............................16

            2.1         Commitments..........................................16

            2.2         Procedure for Revolving Credit Borrowing.............17

            2.3         [Intentionally omitted]..............................17

            2.4         [Intentionally omitted]..............................17

            2.5         Facility Fee.........................................17

            2.6         Termination or Reduction of Commitments..............17

            2.7         Repayment of Revolving Credit Loans..................18

            2.8         CAF Advances.........................................18

            2.9         Procedure for CAF Advance Borrowing..................18

            2.10        Repayment of CAF Advances............................21

            2.11        Certain Restrictions with Respect to CAF Advances....21

            2.12        [Intentionally omitted]..............................21

            2.13        [Intentionally omitted]..............................21

            2.14        [Intentionally omitted]..............................21

            2.15        [Intentionally omitted]..............................21

            2.16        [Intentionally omitted]..............................21

            2.17        [Intentionally omitted]..............................21

SECTION 3       CERTAIN PROVISIONS APPLICABLE TO THE LOANS...................21

            3.1         Optional and Mandatory Prepayments...................21

            3.2         Conversion and Continuation Options..................22

            3.3         Minimum Amounts and Maximum Number of Tranches.......22

            3.4         Interest Rates and Payment Dates.....................23

            3.5         Computation of Interest and Fees.....................23

            3.6         Inability to Determine Interest Rate.................24

            3.7         Pro Rata Treatment and Payments......................24

            3.8         Illegality...........................................25

                                        i
<PAGE>

            3.9         Requirements of Law..................................26

            3.10        Taxes................................................27

            3.11        Indemnity............................................28

            3.12        Change of Lending Office; Removal of Lender..........29

            3.13        Evidence of Debt.....................................29
..
SECTION 4       [Intentionally Omitted]......................................30

SECTION 5       [Intentionally Omitted]......................................30

SECTION 6       REPRESENTATIONS AND WARRANTIES...............................30

            6.1         Financial Condition..................................30

            6.2         No Change............................................31

            6.3         Corporate Existence; Compliance with Law.............31

            6.4         Corporate Power; Consents and Authorization;
                          Enforceable Obligations............................31

            6.5         No Legal Bar.........................................31

            6.6         No Material Litigation...............................32

            6.7         No Default...........................................32

            6.8         Intellectual Property................................32

            6.9         Taxes................................................32

            6.10        Federal Regulations..................................33

            6.11        ERISA................................................33

            6.12        Investment Company Act; Other Regulations............33

            6.13        Purpose of Loans.....................................33

            6.14        Environmental Matters................................33

            6.15        Disclosure...........................................34

SECTION 7       CONDITIONS PRECEDENT.........................................34

            7.1         Conditions to Initial Loans..........................34

            7.2         Conditions to Each Loan..............................35

            7.3         Conditions to Term-Out...............................36

SECTION 8       AFFIRMATIVE COVENANTS........................................36

            8.1         Financial Statements.................................36

            8.2         Certificates; Other Information......................37

                                       ii
<PAGE>

            8.3         Payment of Obligations...............................37

            8.4         Conduct of Business and Maintenance of Existence.....38

            8.5         Maintenance of Property; Insurance...................38

            8.6         Inspection of Property; Books and Records;
                          Discussions........................................38

            8.7         Notices..............................................38

SECTION 9       NEGATIVE COVENANTS...........................................39

            9.1         Financial Covenant...................................39

            9.2         Limitation on Liens..................................39

            9.3         Limitation on Indebtedness...........................40

            9.4         Limitation on Fundamental Changes....................40

SECTION 10      EVENTS OF DEFAULT............................................41

SECTION 11      THE AGENTS...................................................43

            11.1        Appointment..........................................43

            11.2        Delegation of Duties.................................43

            11.3        Exculpatory Provisions...............................44

            11.4        Reliance by Administrative Agent.....................44

            11.5        Notice of Default....................................44

            11.6        Non-Reliance on Administrative Agent and
                          Other Lenders......................................45

            11.7        Indemnification......................................45

            11.8        Administrative Agent in Its Individual Capacity......46

            11.9        Successor Administrative Agent.......................46

            11.10       The Arrangers, the Bookrunners, the Syndication
                          Agents and the Documentation Agents................46

SECTION 12      [Intentionally Omitted]......................................46

SECTION 13      MISCELLANEOUS................................................46

            13.1        Amendments and Waivers...............................46

            13.2        Notices..............................................47

            13.3        No Waiver; Cumulative Remedies.......................48

            13.4        Survival of Representations and Warranties...........48

            13.5        Payment of Expenses and Taxes........................48

                                       iii
<PAGE>

            13.6        Successors and Assigns; Participations and
                          Assignments........................................49

            13.7        Adjustments; Set-off.................................51

            13.8        Counterparts.........................................52

            13.9        Severability.........................................52

            13.10       Integration..........................................52

            13.11       GOVERNING LAW........................................52

            13.12       Submission To Jurisdiction; Waivers..................52

            13.13       Acknowledgements.....................................53

            13.14       Confidentiality......................................53

            13.15       [Intentionally omitted]..............................54

            13.16       [Intentionally omitted]..............................54

            13.17       WAIVERS OF JURY TRIAL................................54

            13.18       USA Patriot Act Notice...............................54













                                       iv
<PAGE>

SCHEDULES

Schedule I      Names, Addresses and Commitments of Lenders
Schedule 9.2    Existing Liens


EXHIBITS

Exhibit A       Form of Revolving Credit Note
Exhibit B       Form of CAF Advance Note
Exhibit C       Form of CAF Advance Request
Exhibit D       Form of CAF Advance Offer
Exhibit E       Form of CAF Advance Confirmation
Exhibit F       Form of Closing Certificate
Exhibit G       Form of Opinion of Counsel to Borrower
Exhibit H       Form of Assignment and Acceptance
Exhibit I       Form of Exemption Certificate





















                                        v
<PAGE>

            364-DAY REVOLVING CREDIT AGREEMENT, dated as of May 14, 2004, among
(i) BOSTON SCIENTIFIC CORPORATION, a Delaware corporation (the "Borrower"), (ii)
the several banks and other financial institutions or entities from time to time
parties hereto (the "Lenders"), (iii) BANK OF AMERICA, N.A. and WACHOVIA BANK,
NATIONAL ASSOCIATION, as Syndication Agents (each, in such capacity, a
"Syndication Agent", and collectively, the "Syndication Agents"), (iv) ABN AMRO
BANK N.V., CITICORP USA, INC., DEUTSCHE BANK AG NEW YORK BRANCH, SUMITOMO MITSUI
BANKING CORPORATION and THE BANK OF TOKYO-MITSUBISHI, LTD., NEW YORK BRANCH, as
co-documentation agents (collectively, the "Documentation Agents"), (v) BANC OF
AMERICA SECURITIES LLC and J.P. MORGAN SECURITIES INC., as Joint Lead Arrangers
(each, in such capacity, an "Arranger", and collectively, the "Arrangers") and
as Joint Bookrunners (each in such capacity, a "Bookrunner", and collectively,
the "Bookrunners"), (vi) BNP PARIBAS and MERRILL LYNCH BANK USA, as Managing
Agents (each, in such capacity, a "Managing Agent", and collectively, the
"Managing Agents") and (vii) JPMORGAN CHASE BANK, as administrative agent for
the Lenders hereunder (in such capacity, the "Administrative Agent").

                              W I T N E S S E T H:
                              - - - - - - - - - -

            WHEREAS, the Borrower, certain of the Lenders, the Arrangers, the
Administrative Agent and others are parties to the Credit Agreement, dated as of
May 30, 2003 (as amended, supplemented or otherwise modified prior to the date
hereof, the "Existing 364-Day Credit Facility");

            WHEREAS, the Borrower has requested that the Lenders make available
a 364-day credit facility as described herein to replace the Existing 364-Day
Credit Facility which shall be repaid in full and all commitments and agreements
with respect thereto shall be terminated on or prior to the Closing Date; and

            WHEREAS, the Lenders have agreed to make such 364-day credit
facility available upon the terms and subject to the conditions set forth
herein;

            NOW, THEREFORE, in consideration of the premises, and of the mutual
covenants and agreements herein contained and other good and valuable
consideration, receipt of which is hereby acknowledged, the parties hereto
hereby agree as follows:

                                    SECTION 1
                                   DEFINITIONS

            1.1 DEFINED TERMS. As used in this Agreement, the following terms
shall have the following meanings:

            "ABR": for any day, a rate per annum (rounded upwards, if necessary,
to the next 1/16 of 1%) equal to the greatest of (a) the Prime Rate in effect on
such day, (b) the Base CD Rate in effect on such day plus 1% and (c) the Federal
Funds Effective Rate in effect on such day plus 1/2 of 1%. For purposes hereof:
"Prime Rate" shall mean the rate of interest per annum publicly announced from
time to time by JPMorgan Chase Bank as its prime rate in effect at its principal

<PAGE>

office in New York City (the Prime Rate not being intended to be the lowest rate
of interest charged by JPMorgan Chase Bank in connection with extensions of
credit to debtors); "Base CD Rate" shall mean the sum of (a) the product of (i)
the Three-Month Secondary CD Rate and (ii) a fraction, the numerator of which is
one and the denominator of which is one minus the C/D Reserve Percentage and (b)
the C/D Assessment Rate; "Three-Month Secondary CD Rate" shall mean, for any
day, the secondary market rate for three-month certificates of deposit reported
as being in effect on such day (or, if such day shall not be a Business Day, the
next preceding Business Day) by the Board of Governors of the Federal Reserve
System (the "Board") through the public information telephone line of the
Federal Reserve Bank of New York (which rate will, under the current practices
of the Board, be published in Federal Reserve Statistical Release H.15(519)
during the week following such day), or, if such rate shall not be so reported
on such day or such next preceding Business Day, the average of the secondary
market quotations for three-month certificates of deposit of major money center
banks in New York City received at approximately 10:00 A.M., New York City time,
on such day (or, if such day shall not be a Business Day, on the next preceding
Business Day) by the Administrative Agent from three New York City negotiable
certificate of deposit dealers of recognized standing selected by it; and
"Federal Funds Effective Rate" shall mean, for any day, the weighted average of
the rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day that is a Business Day, the average of the
quotations for the day of such transactions received by the Administrative Agent
from three federal funds brokers of recognized standing selected by it. Any
change in the ABR due to a change in the Prime Rate, the Three-Month Secondary
CD Rate or the Federal Funds Effective Rate shall be effective as of the opening
of business on the effective day of such change in the Prime Rate, the
Three-Month Secondary CD Rate or the Federal Funds Effective Rate, respectively.

            "ABR Loans": Revolving Credit Loans bearing interest based upon the
ABR.

            "Administrative Agent":  as defined in the preamble hereto.

            "Affiliate": as to any Person, any other Person (other than a
Subsidiary) which, directly or indirectly, is in control of, is controlled by,
or is under common control with, such Person. For purposes of this definition,
"control" of a Person means the power, directly or indirectly, either to (a)
vote 10% or more of the securities having ordinary voting power for the election
of directors of such Person or (b) direct or cause the direction of the
management and policies of such Person, whether by contract or otherwise.

            "Agents": the collective reference to the Administrative Agent, the
Syndication Agents, the Documentation Agents, the Managing Agents, the Arrangers
and the Bookrunners.

            "Aggregate Commitments": the aggregate amount of the Commitments of
all of the Lenders.

            "Aggregate Outstandings": as at any date of determination with
respect to any Lender, an amount equal to the aggregate unpaid principal amount
of such Lender's Loans on such date.

                                        2
<PAGE>

            "Agreement": this 364-Day Revolving Credit Agreement, as amended,
amended and restated, supplemented or otherwise modified from time to time.

            "Applicable Margin": with respect to each day for each Type of Loan,
the rate per annum based on the Ratings in effect on such day, as set forth
under the relevant column heading below:


                                  PRIOR TO THE
                                TERMINATION DATE
                                ----------------


Any Date Other than an Excess Utilization Day             Excess Utilization Day
---------------------------------------------             ----------------------


Rating        Eurodollar Loans      ABR Loans     Eurodollar Loans     ABR Loans
------        ----------------      ---------     ----------------     ---------

Rating I         .150%              0%               .275%             0%
Rating II        .190%              0%               .315%             0%
Rating III       .305%              0%               .430%             0%
Rating IV        .460%              0%               .585%             0%
Rating V         .550%              0%               .675%             0%
Rating VI        .825%              0%               .950%             0%


                                 TERM-OUT PERIOD
                                 ---------------

Rating                     Eurodollar Loans                     ABR Loans
------                     ----------------                     ---------

Rating I                        .575%                               0%
Rating II                       .625%                               0%
Rating III                      .750%                               0%
Rating IV                       .925%                               0%
Rating V                        1.050%                            .050%
Rating VI                       1.375%                            .375%


            "Arrangers": as defined in the preamble hereto.
             ---------

            "Assignee": as defined in subsection 13.6(c).
             --------

            "Base CD Rate": as defined in the definition of ABR.
             ------------

            "benefited Lender": as defined in subsection 13.7.

            "Board": as defined in the definition of ABR.

            "Bookrunners": as defined in the preamble hereto.

            "Borrower": as defined in the preamble hereto.

            "Borrowing Date": any Business Day specified in a notice pursuant to
subsection 2.2 or 2.9 as a date on which the Borrower requests the Lenders to
make Loans hereunder.

                                        3
<PAGE>

            "Business": as defined in subsection 6.14.

            "Business Day": a day other than a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law to
close; provided that when such term is used for the purpose of determining the
date on which the Eurodollar Base Rate is determined under this Agreement it
means any such day on which dealings in Dollar deposits are conducted by and
between banks in the London interbank eurodollar market.

            "CAF Advance": each competitive advance facility advance made
pursuant to subsection 2.8.

            "CAF Advance Availability Period": the period from and including the
Closing Date to and including the date which is seven days prior to the
Termination Date.

            "CAF Advance Confirmation": each confirmation by the Borrower of its
acceptance of CAF Advance Offers, which confirmation shall be substantially in
the form of Exhibit E and shall be delivered to the Administrative Agent by
facsimile transmission.

            "CAF Advance Interest Payment Date": as to each CAF Advance, each
interest payment date specified by the Borrower for such CAF Advance in the
related CAF Advance Request.

            "CAF Advance Maturity Date": as to any CAF Advance, the date
specified by the Borrower pursuant to subsection 2.9(d)(ii) in its acceptance of
the related CAF Advance Offer.

            "CAF Advance Note": as defined in subsection 3.13(e).

            "CAF Advance Offer": each offer by a Lender to make CAF Advances
pursuant to a CAF Advance Request, which offer shall contain the information
specified in Exhibit D and shall be delivered to the Administrative Agent by
telephone, immediately confirmed by facsimile transmission.

            "CAF Advance Request": each request by the Borrower for Lenders to
submit bids to make CAF Advances, which request shall contain the information in
respect of such requested CAF Advances specified in Exhibit C and shall be
delivered to the Administrative Agent in writing, by facsimile transmission, or
by telephone, immediately confirmed by facsimile transmission.

            "Capital Lease Obligations": as to any Person, 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, for the purposes of this Agreement, the amount of such obligations at any
time shall be the capitalized amount thereof at such time determined in
accordance with GAAP.

            "Capital Stock": 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 or options to purchase any of the foregoing.

                                        4
<PAGE>

            "C/D Assessment Rate": for any day as applied to any ABR Loan, the
annual assessment rate in effect on such day which is payable by a member of the
Bank Insurance Fund maintained by the Federal Deposit Insurance Corporation (the
"FDIC") classified as well-capitalized and within supervisory subgroup "B" (or a
comparable successor assessment risk classification) within the meaning of 12
C.F.R. ss. 327.4 (or any successor provision) to the FDIC (or any successor) for
the FDIC's (or such successor's) insuring time deposits at offices of such
institution in the United States.

            "C/D Reserve Percentage": for any day as applied to any ABR Loan,
that percentage (expressed as a decimal) which is in effect on such day, as
prescribed by the Board, for determining the maximum reserve requirement for a
Depositary Institution (as defined in Regulation D of the Board) in respect of
new non-personal time deposits in Dollars having a maturity of 30 days or more.

            "Closing Date": the date, on or before May 28, 2004, on which
conditions precedent set forth in subsection 7.1 shall be satisfied.

            "Code": the Internal Revenue Code of 1986, as amended from time to
time.

            "Commitment": as to any Lender, the obligation of such Lender to
make Revolving Credit Loans to the Borrower hereunder in an aggregate principal
amount at any one time outstanding not to exceed the amount set forth opposite
such Lender's name on Schedule I under the heading "Commitment," as such amount
may be reduced or increased from time to time in accordance with the provisions
of this Agreement.

            "Commitment Percentage": as to any Lender at any time, the
percentage which such Lender's Commitment at such time constitutes of the
Aggregate Commitments at such time (or, if the Commitments have terminated or
expired, the percentage which (a) the Aggregate Outstandings of such Lender at
such time then constitutes of (b) the Total Outstandings of all Lenders at such
time).

            "Commitment Period": the period from and including the Closing Date
to but excluding the Termination Date or such earlier date on which the
Commitments shall terminate as provided herein.

            "Commonly Controlled Entity": an entity, whether or not
incorporated, which is under common control with the Borrower within the meaning
of Section 4001 of ERISA or is part of a group which includes the Borrower and
which is treated as a single employer under Section 414 of the Code.

            "Conduit Lender": any special purpose corporation organized and
administered by any Lender for the purpose of making Loans otherwise required to
be made by such Lender and designated by such Lender in a written instrument;
provided, that the designation by any Lender of a Conduit Lender shall not
relieve the designating Lender of any of its obligations to fund a Loan under
this Agreement if, for any reason, its Conduit Lender fails to fund any such
Loan, and the designating Lender (and not the Conduit Lender) shall have the
sole right and responsibility to deliver all consents and waivers required or
requested under this Agreement

                                        5
<PAGE>

with respect to its Conduit Lender; and provided, further, that no Conduit
Lender shall (a) be entitled to receive any greater amount pursuant to Section
3.9, 3.10, 3.11 or 13.5 than the designating Lender would have been entitled to
receive in respect of the extensions of credit made by such Conduit Lender or
(b) be deemed to have any Commitment.

            "Consolidated EBITDA": of any Person for any period, Consolidated
Net Income of such Person and its Subsidiaries for such period plus, without
duplication and to the extent reflected as a charge in the statement of such
Consolidated Net Income for such period, the sum of (a) income tax expense, (b)
Consolidated Interest Expense of such Person and its Subsidiaries, amortization
or writeoff of debt discount and debt issuance costs and commissions, discounts
and other fees and charges associated with Indebtedness, (c) depreciation
expense, (d) amortization of intangibles (including, but not limited to,
goodwill) and organization costs and (e) any extraordinary, unusual or
nonrecurring expenses or losses (to the extent any of the foregoing are non-cash
items) (including, whether or not otherwise includable as a separate item in the
statement of such Consolidated Net Income for such period, losses on sales of
assets outside of the ordinary course of business and including special charges
and purchased research and development charges in connection with acquisitions),
and minus, to the extent included in the statement of such Consolidated Net
Income for such period, the sum of (a) interest income (except to the extent
deducted in determining Consolidated Interest Expense) and (b) any
extraordinary, unusual or non-recurring income or gains (to the extent any of
the foregoing are non-cash items) (including, whether or not otherwise
includable as a separate item in the statement of such Consolidated Net Income
for such period, gains on the sales of assets outside of the ordinary course of
business).

            "Consolidated Interest Expense": of any Person for any period, total
interest expense of such Person and its Subsidiaries for such period with
respect to all outstanding Indebtedness of such Person and its Subsidiaries
determined in accordance with GAAP (including, all net costs that are allocable
to such period in accordance with GAAP).

            "Consolidated Leverage Ratio": as at the last day of any period of
four consecutive fiscal quarters of the Borrower, the ratio of (a) Consolidated
Total Debt on such day to (b) Consolidated EBITDA of the Borrower and its
Subsidiaries for such period.

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

            "Consolidated Tangible Assets": at any date, Consolidated Total
Assets minus (without duplication) the net book value of all assets which would
be treated as intangible assets, as determined on a consolidated basis in
accordance with GAAP.

            "Consolidated Total Assets": at any date, the net book value of all
assets of the Borrower and its Subsidiaries as determined on a consolidated
basis in accordance with GAAP.

            "Consolidated Total Debt": 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.

                                        6
<PAGE>

            "Continuing Directors": as defined in Section 10(h).

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

            "Default": any of the events specified in Section 10, whether or not
any requirement for the giving of notice, the lapse of time, or both, or any
other condition, has been satisfied.

            "Documentation Agents": as defined in the preamble hereto.

            "Dollars" and "$": dollars in lawful currency of the United States
of America.

            "Environmental Laws": any and all applicable foreign, Federal,
state, local or municipal laws, rules, regulations, statutes, ordinances, codes,
decrees, or other enforceable requirements or orders of any Governmental
Authority or other Requirements of Law regulating, relating to or imposing
liability or standards of conduct concerning protection of human health or the
environment, as now or may at any time hereafter be in effect.

            "ERISA": the Employee Retirement Income Security Act of 1974, as
amended from time to time.

            "Eurodollar Base Rate": with respect to each day during each
Interest Period pertaining to a Eurodollar Loan, the rate per annum determined
by the Administrative Agent to be the offered rate for deposits in Dollars with
a term comparable to such Interest Period that appears on the applicable
Telerate Page at approximately 11:00 A.M., London time, two Business Days prior
to the beginning of such Interest Period; provided, however, that if at any time
for any reason such offered rate for Dollars does not appear on a Telerate Page,
"Eurodollar Base Rate" shall mean, with respect to each day during each Interest
Period pertaining to a Loan denominated in Dollars, the rate per annum equal to
the average (rounded upward to the nearest 1/16th of 1%) of the respective rates
notified to the Administrative Agent by each of the Reference Lenders as the
rate at which such Reference Lender is offered Dollar deposits at or about 11:00
A.M., London time, two Business Days prior to the beginning of such Interest
Period in the London interbank market for delivery on the first day of such
Interest Period for the number of days comprised therein.

            "Eurodollar Rate": with respect to each day during each Interest
Period pertaining to a Loan, a rate per annum determined for such day in
accordance with the following formula (rounded upward to the nearest 1/100th of
1%):

                              Eurodollar Base Rate
                              --------------------
                     1.00 - Eurodollar Reserve Requirements

            "Eurodollar Reserve Requirements": for any day as applied to a Loan,
the aggregate (without duplication) of the rates (expressed as a decimal) of
reserve requirements in effect on such day (including, without limitation,
basic, supplemental, marginal and emergency reserves) under any regulations of
the Board or other Governmental Authority having jurisdiction with respect
thereto dealing with reserve requirements prescribed for eurocurrency funding
(currently

                                        7
<PAGE>

referred to as "Eurocurrency Liabilities" in Regulation D of such Board)
maintained by a member bank of such System.

            "Eurodollar Loans": Revolving Credit Loans, the rate of interest
applicable to which is based upon the Eurodollar Rate.

            "Event of Default": any of the events specified in Section 10,
provided that any requirement for the giving of notice, the lapse of time, or
both, or any other condition, has been satisfied.

            "Excess Utilization Day": any day on which the sum of the Total
Outstandings, plus the Aggregate Total Outstandings of all Lenders under (and as
defined in) the Multi-Year Credit Facility, exceeds, 50.0% of the aggregate
amount of the Commitments hereunder and the Revolving Credit Commitments under
(and as defined in) the Multi-Year Credit Facility (or, in each case, with
respect to any day after termination of such Commitments and Revolving Credit
Commitments, 50.0% of the aggregate amount of the Commitments hereunder and the
Revolving Credit Commitments under (and as defined in) the Multi-Year Credit
Facility in effect on the date immediately prior to the date on which such
Commitments and Revolving Credit Commitments terminated).

            "Existing Credit Facilities": the collective reference to the
Existing Multi-Year Credit Facility and the Existing 364-Day Credit Facility.

            "Existing Multi-Year Credit Facility": the Credit Agreement, dated
as of August 15, 2001, as amended, among the Borrower, the lenders parties
thereto, JPMorgan Chase Bank (formerly known as The Chase Manhattan Bank), as
administrative agent, and others, providing for a $600,000,000 revolving credit
and competitive advance facility.

            "Existing 364-Day Credit Facility": as defined in the recitals
hereto.

            "Facility Fee Rate": for each day during each calculation period,
the rate per annum based on the Ratings in effect on such day, as set forth
below:

                                                  Facility
                          Rating                  Fee Rate

                          Rating I                .050%
                          Rating II               .060%
                          Rating III              .070%
                          Rating IV               .090%
                          Rating V                .125%
                          Rating VI               .175%


            "Fee Commencement Date": the Closing Date.

            "Financing Lease": any lease of property, real or personal, the
obligations of the lessee in respect of which are required in accordance with
GAAP to be capitalized on a balance sheet of the lessee.

                                        8
<PAGE>

            "Fixed Rate CAF Advance": any CAF Advance made pursuant to a Fixed
Rate CAF Advance Request.

            "Fixed Rate CAF Advance Request": any CAF Advance Request requesting
the Lenders to offer to make CAF Advances at a fixed rate (as opposed to a rate
composed of the Eurodollar Rate plus (or minus) a margin).

            "Funding Commitment Percentage": as at any date of determination,
with respect to any Lender, that percentage equal to (a) the amount of such
Lender's Commitment then in effect on such date minus such Lender's Aggregate
Outstandings on such date, divided by (b) the amount of all Lenders' Commitments
then in effect on such date minus all Lenders' Total Outstandings on such date.

            "GAAP": generally accepted accounting principles in the United
States of America consistent with those utilized in preparing the audited
financial statements referred to in subsection 6.1.

            "Governmental Authority": any nation or government, any state or
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.

            "Guarantee Obligation": as to any Person (the "guaranteeing
person"), any obligation of (a) the guaranteeing person or (b) another Person
(including, without limitation, any bank under any letter of credit) to induce
the creation of which the guaranteeing person has issued a reimbursement,
counterindemnity or similar obligation, in either case guaranteeing or in effect
guaranteeing any Indebtedness, leases, dividends or other obligations (the
"primary obligations") of any other unrelated third Person (the "primary
obligor") in any manner, whether directly or indirectly, including, without
limitation, any obligation of the guaranteeing person, whether or not
contingent, (i) to purchase any such primary obligation or any property
constituting direct or indirect security therefor, (ii) to advance or supply
funds (1) for the purchase or payment of any such primary obligation or (2) to
maintain working capital or equity capital of the primary obligor or otherwise
to maintain the net worth or solvency of the primary obligor, (iii) to purchase
property, securities or services primarily for the purpose of assuring the owner
of any such primary obligation of the ability of the primary obligor to make
payment of such primary obligation or (iv) otherwise to assure or hold harmless
the owner of any such primary obligation against loss in respect thereof;
provided, however, that the term Guarantee Obligation shall not include
endorsements of instruments for deposit or collection in the ordinary course of
business. The amount of any Guarantee Obligation of any guaranteeing person
shall be deemed to be the lower of (a) an amount equal to the stated or
determinable amount of the primary obligation in respect of which such Guarantee
Obligation is made and (b) the maximum amount for which such guaranteeing person
may be liable pursuant to the terms of the instrument embodying such Guarantee
Obligation, unless such primary obligation and the maximum amount for which such
guaranteeing person may be liable are not stated or determinable, in which case
the amount of such Guarantee Obligation shall be such guaranteeing person's
reasonably anticipated liability in respect thereof as determined by the
Borrower in good faith.

                                        9
<PAGE>

            "Hedge Agreements": all agreements with non-related third parties
with respect to any swap, forward, future or derivative transaction or option or
similar agreements involving, or settled by reference to, one or more rates,
currencies, commodities, equity or debt instruments or securities, or economic,
financial or pricing indices or measures of economic, financial or pricing risk
or value or any similar transaction or any combination of these transactions;
provided that no employee benefit plan of the Borrower or any of its
Subsidiaries shall be a "Hedge Agreement".

            "Indebtedness": of any Person at any date, without duplication, (a)
all obligations of such Person for borrowed money, (b) all obligations of such
Person for the deferred purchase price of property or services (other than
current trade liabilities incurred in the ordinary course of such Person's
business and payable in accordance with customary practices and earn-outs and
other similar obligations in respect of acquisition and other similar
agreements), (c) all obligations of such Person evidenced by notes, bonds,
debentures or other similar instruments, (d) all indebtedness created or arising
under any conditional sale or other title retention agreement with respect to
property acquired by such Person (even though the rights and remedies of the
seller or lender under such agreement in the event of default are limited to
repossession or sale of such property), (e) all Capital Lease Obligations of
such Person, (f) all obligations of such Person, contingent or otherwise, as an
account party or applicant under or in respect of acceptances, letters of
credit, surety bonds or similar arrangements, (g) the liquidation value of all
redeemable preferred Capital Stock of such Person, (h) all indebtedness of such
Person, determined in accordance with GAAP, arising out of a Receivables
Transaction, (i) all Guarantee Obligations of such Person in respect of
obligations of the kind referred to in clauses (a) through (h) above, (j) all
obligations of the kind referred to in clauses (a) through (i) above secured by
(or for which the holder of such obligation has an existing right, contingent or
otherwise, to be secured by) any Lien on property (including accounts and
contract rights) owned by such Person, whether or not such Person has assumed or
become liable for the payment of such obligation, and (k) for the purposes of
Section 10(d) only, all obligations of such Person in respect of Hedge
Agreements. The Indebtedness of any Person shall include the Indebtedness of any
other entity (including any partnership in which such Person is a general
partner) to the extent such Person is liable therefor as a result of such
Person's ownership interest in or other relationship with such entity, except to
the extent the terms of such Indebtedness expressly provide that such Person is
not liable therefor.

            "Insolvency": with respect to any Multiemployer Plan, the condition
that such Plan is insolvent within the meaning of Section 4245 of ERISA.

            "Insolvent": pertaining to a condition of Insolvency.

            "Interest Payment Date": (a) as to any ABR Loan, the last day of
each March, June, September and December, (b) as to any Eurodollar Loan having
an Interest Period of three months or less, the last day of such Interest
Period, and (c) as to any Eurodollar Loan having an Interest Period longer than
three months, each day which is three months, or a whole multiple thereof, after
the first day of such Interest Period and the last day of such Interest Period.

                                       10
<PAGE>

            "Interest Period": (a) with respect to any Eurodollar Loan:

                  (i) initially, the period commencing on the Borrowing Date or
            conversion date, as the case may be, with respect to such Eurodollar
            Loan and ending one, two, three, six or nine months thereafter, as
            selected by the Borrower in its notice of borrowing or notice of
            conversion, as the case may be, given with respect thereto; and

                  (ii) thereafter, each period commencing on the last day of the
            next preceding Interest Period applicable to such Eurodollar Loan
            and ending one, two, three, six or nine months thereafter, as
            selected by the Borrower by irrevocable notice to the Administrative
            Agent not less than three Business Days prior to the last day of the
            then current Interest Period with respect thereto;

            provided that, all of the foregoing provisions relating to Interest
            Periods are subject to the following:

                  (1) if any Interest Period would otherwise end on a day that
            is not a Business Day, such Interest Period shall be extended to the
            next succeeding Business Day unless the result of such extension
            would be to carry such Interest Period into another calendar month
            in which event such Interest Period shall end on the immediately
            preceding Business Day;

                  (2) any Interest Period in respect of any Loan made by any
            Lender that would otherwise extend beyond the Termination Date
            applicable to such Lender shall end on such Termination Date; and

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

            (b) with respect to any LIBO Rate CAF Advance, the period beginning
on the Borrowing Date with respect thereto and ending on the CAF Advance
Maturity Date with respect thereto.

            "JPMorgan Chase Bank": JPMorgan Chase Bank, a New York banking
corporation.


            "Lender Affiliate": (a) any Affiliate of any Lender, (b) any Person
that is administered or managed by any Lender and that is engaged in making,
purchasing, holding or otherwise investing in commercial loans and similar
extensions of credit in the ordinary course of its business and (c) with respect
to any Lender which is a fund that invests in commercial loans and similar
extensions of credit, any other fund that invests in commercial loans and
similar extensions of credit and is managed or advised by the same investment
advisor as such Lender or by an Affiliate of such Lender or investment advisor.

            "Lenders": as defined in the preamble hereto; provided, that unless
the context otherwise requires, each reference herein to the Lenders shall be
deemed to include any Conduit Lender.

                                       11
<PAGE>

            "LIBO Rate CAF Advance": any CAF Advance made pursuant to a LIBO
Rate CAF Advance Request.

            "LIBO Rate CAF Advance Request": any CAF Advance Request requesting
the Lenders to offer to make CAF Advances at an interest rate equal to the
Eurodollar Rate for the currency of such CAF Advance plus (or minus) a margin.

            "Lien": any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge or other security
interest or any preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including, without limitation, any
conditional sale or other title retention agreement and any Financing Lease
having substantially the same economic effect as any of the foregoing).

            "Loan": any Revolving Credit Loan or CAF Advance, as the case may
be.

            "Loan Documents": this Agreement or any Notes.

            "Majority Lenders": (a) at any time prior to the termination of the
Commitments, Lenders, the Commitment Percentages of which aggregate more than
50%; and (b) at any time after the termination of the Commitments, Lenders whose
Aggregate Outstandings aggregate more than 50% of the Total Outstandings of all
Lenders.

            "Managing Agents": as defined in the preamble hereto.

            "Material Adverse Effect": a material adverse effect on (a) the
business, operations, property 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 any of the other Loan Documents or the
rights or remedies of the Administrative Agent or the Lenders hereunder or
thereunder.

            "Materials of Environmental Concern": any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products or any
hazardous or toxic substances, materials or wastes, defined or regulated as such
in or under any Environmental Law, including, without limitation, asbestos,
polychlorinated biphenyls and urea-formaldehyde insulation.

            "Maturity Date": the Termination Date or, if the conditions to the
Term-Out set forth in subsection 7.3 are satisfied on the Termination Date, the
first anniversary of the Termination Date.

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

            "Multi-Year Credit Facility": the Multi-Year Revolving Credit
Agreement dated the date hereof among the Borrower, the lenders parties thereto,
JPMorgan Chase Bank, as administrative agent, and others, as the same may from
time to time be amended, amended and restated, supplemented or otherwise
modified.

            "Multiemployer Plan": a Plan which is a multiemployer plan as
defined in Section 4001(a)(3) of ERISA.

                                       12
<PAGE>

            "Non-Excluded Taxes": as defined in subsection 3.10.

            "Notes": the collective reference to any Revolving Credit Notes and
any CAF Advance Notes.

            "Outstanding Amount": with respect to Revolving Credit Loans and CAF
Advances on any date, the aggregate outstanding principal amount thereof after
giving effect to any borrowings and prepayments or repayments of Revolving
Credit Loans and CAF Advances, as the case may be, occurring on such date.

            "Participant": as defined in subsection 13.6(b).

            "Patriot Act": as defined in subsection 13.18.

            "PBGC": the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA.

            "Person": an individual, partnership, corporation, business trust,
joint stock company, trust, unincorporated association, joint venture,
Governmental Authority or other entity of whatever nature.

            "Plan": at a particular time, any employee benefit plan which is
covered by ERISA and in respect of which the Borrower or a Commonly Controlled
Entity is (or, if such plan were terminated at such time, would under Section
4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.

            "Properties": as defined in subsection 6.14.

            "Rating": the respective rating of each of the Rating Agencies
applicable to the long-term senior unsecured non-credit enhanced debt of the
Borrower, as announced by the Rating Agencies from time to time.

            "Rating Agencies": collectively, S&P and Moody's.

            "Rating Category": each of Rating I, Rating II, Rating III, Rating
IV, Rating V and Rating VI.


                                       13
<PAGE>

            "Rating I, Rating II, Rating III, Rating IV, Rating V and Rating
VI": the respective Ratings set forth below:

             Rating
            Category                 S&P                        Moody's
            --------                 ---                        -------

            Rating I        greater than or equal       greater than or equal
                            to A+                       to A1

            Rating II       A                                 A2

            Rating III      A-                                A3

            Rating IV       BBB+                              Baa1

            Rating V        BBB                               Baa2

            Rating VI       lower than or equal         lower than or equal
                            to BBB-                     to Baa3

; provided, that (i) if on any day the Ratings of the Rating Agencies do not
fall in the same Rating Category, and the lower of such Ratings (i.e., the
Rating Category designated by a numerically higher Roman numeral) is one Rating
Category lower than the higher of such Ratings, then the Rating Category of the
higher of such Ratings shall be applicable for such day, (ii) if on any day the
Ratings of the Rating Agencies do not fall in the same Rating Category, and the
lower of such Ratings is more than one Rating Category lower than the higher of
such Ratings, then the Rating Category next higher from that of the lower of
such Ratings shall be applicable for such day, (iii) if on any day the Rating of
only one of the Rating Agencies is available, then the Rating Category of such
Rating shall be applicable for such day and (iv) if on any day a Rating is
available from neither of the Rating Agencies, then Rating VI shall be
applicable for such day. Any change in the applicable Rating Category resulting
from a change in the Rating of a Rating Agency shall become effective on the
date such change is publicly announced by such Rating Agency.

            "Receivables": any accounts receivable of any Person, including,
without limitation, any thereof constituting or evidenced by chattel paper,
instruments or general intangibles (as defined in the Uniform Commercial Code of
the State of New York), and all proceeds thereof and rights (contractual and
other) and collateral related thereto.

            "Receivables Subsidiary": any special purpose, bankruptcy-remote
Subsidiary of the Borrower that purchases, on a revolving basis, Receivables
generated by the Borrower or any of its Subsidiaries.

            "Receivables Transaction": any transactions or series of related
transactions providing for the financing of Receivables of the Borrower or any
of its Subsidiaries.

            "Reference Lenders": JPMorgan Chase Bank, Bank of America, N.A., The
Bank of Tokyo-Mitsubishi, Ltd., New York Branch, Deutsche Bank AG New York
Branch, Citibank, N.A., Sumitomo Mitsui Banking Corporation and ABN AMRO Bank
N.V.

                                       14
<PAGE>

            "Register": as defined in subsection 13.6(d).

            "Related Parties" with respect to any Person, such Person's
Affiliates and partners, directors, officers, employees, agents and advisors of
such Person and such Person's Affiliates.

            "Reorganization": with respect to any Multiemployer Plan, the
condition that such plan is in reorganization within the meaning of Section 4241
of ERISA.

            "Reportable Event": any of the events set forth in Section 4043(c)
of ERISA, other than those events as to which the thirty day notice period is
waived under subsections .27, .28, .29, .30, .31, .32, .34 or .35 of PBGC
Reg.ss.4043.

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

            "Responsible Officer": with respect to the Borrower, the chief
executive officer and the president of the Borrower or, with respect to
financial matters, the chief financial officer of the Borrower.

            "Revolving Credit Loans": as defined in subsection 2.1.

            "Revolving Credit Note": as defined in subsection 3.13(d).

            "Revolving Lender": each Lender that has a Commitment hereunder or
that holds Revolving Credit Loans.

            "S&P": Standard & Poor's Ratings Services.

            "Signing Date": the date on which the Lenders have signed this
Agreement.

            "Single Employer Plan": any Plan that is covered by Title IV of
ERISA, but that is not a Multiemployer Plan.

            "Subsidiary": as to any Person, a corporation, limited liability
company, partnership or other entity of which shares of stock or other ownership
interests having ordinary voting power (other than stock or such other ownership
interests having such power only by reason of the happening of a contingency) to
elect a majority of the board of directors or other managers of such
corporation, partnership or other entity are at the time owned, or the
management of which is otherwise controlled, directly or indirectly through one
or more intermediaries, or both, by such Person. Unless otherwise qualified, all
references to a "Subsidiary" or to "Subsidiaries" in this Agreement shall refer
to a Subsidiary or Subsidiaries of the Borrower.

            "Syndication Agents": as defined in the preamble hereto.

                                       15
<PAGE>

            "Term-Out": the extension of the Maturity Date from the Termination
Date to the first anniversary of the Termination Date, as described in the
definition of "Maturity Date".

            "Term-Out Period": the period beginning on the day following the
Termination Date.

            "Termination Date": May 13, 2005.

            "Total Outstandings": the Outstanding Amount of all Loans of all of
the Lenders.

            "Tranche": the collective reference to Eurodollar Loans the then
current Interest Periods with respect to all of which begin on the same date and
end on the same later date (whether or not such Loans shall originally have been
made on the same day); Tranches may be identified as "Eurodollar Tranches".

            "Transferee": as defined in subsection 13.6(f).

            "Type": as to any Revolving Credit Loan, its nature as an ABR Loan
or a Eurodollar Loan.

            1.2 OTHER DEFINITIONAL PROVISIONS. (a) Unless otherwise specified
therein, all terms defined in this Agreement shall have the defined meanings
when used in any Notes or any certificate or other document made or delivered
pursuant hereto.

            (b) As used herein and in any Notes, and any certificate or other
document made or delivered pursuant hereto, accounting terms relating to the
Borrower and its Subsidiaries not defined in subsection 1.1 and accounting terms
partly defined in subsection 1.1, to the extent not defined, shall have the
respective meanings given to them under GAAP.

            (c) The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement, and Section,
subsection, Schedule and Exhibit references are to this Agreement unless
otherwise specified.

            (d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.

                                    SECTION 2
                         AMOUNT AND TERMS OF COMMITMENTS

            2.1 COMMITMENTS. (a) Subject to the terms and conditions hereof,
each Lender severally agrees to make revolving credit loans ("Revolving Credit
Loans") in Dollars to the Borrower from time to time during the Commitment
Period so long as after giving effect thereto (i) each Lender's Aggregate
Outstandings do not exceed its Commitment and (ii) the Total Outstandings do not
exceed the Aggregate Commitments. During the Commitment Period, the Borrower may
use the Commitments by borrowing, prepaying the Revolving Credit Loans in whole
or in part, and reborrowing, all in accordance with the terms and conditions
hereof.

                                       16
<PAGE>

            (b) The Revolving Credit Loans may from time to time be (i)
Eurodollar Loans, (ii) ABR Loans or (iii) a combination thereof, as determined
by the Borrower and notified to the Administrative Agent in accordance with
subsections 2.2 and 3.2, provided that no Revolving Credit Loan shall be made as
a Eurodollar Loan after the day that is one month prior to the Termination Date.

            2.2 PROCEDURE FOR REVOLVING CREDIT BORROWING. The Borrower may
borrow under the Commitments during the Commitment Period on any Business Day,
provided that the Borrower shall give the Administrative Agent irrevocable
notice (which notice must be received by the Administrative Agent prior to 10:00
A.M., New York City time, (a) three Business Days prior to the requested
Borrowing Date, if all or any part of the requested Revolving Credit Loans are
to be initially Eurodollar Loans or (b) on the requested Borrowing Date,
otherwise), in each case specifying (i) the amount to be borrowed, (ii) the
requested Borrowing Date, (iii) whether the borrowing is to be of Eurodollar
Loans, ABR Loans or a combination thereof and (iv) if the borrowing is to be
entirely or partly of Eurodollar Loans, the amount of such Type of Loan and the
length of the initial Interest Period therefor. Each borrowing under the
Commitments shall be in an amount equal to (x) in the case of ABR Loans,
$5,000,000 or a whole multiple of $1,000,000 in excess thereof (or, if the
Aggregate Commitments minus the Total Outstandings are less than $1,000,000,
such lesser amount) and (y) in the case of Eurodollar Loans, $5,000,000 or a
whole multiple of $1,000,000 in excess thereof. Upon receipt of any such notice
from the Borrower, the Administrative Agent shall promptly notify each Lender
thereof. Prior to 11:00 A.M., New York City time, on the Borrowing Date
requested by the Borrower, each Lender will make an amount equal to its Funding
Commitment Percentage of the principal amount of the Revolving Credit Loans
requested to be made on such Borrowing Date available to the Administrative
Agent for the account of the Borrower at the New York office of the
Administrative Agent specified in subsection 13.2 in funds immediately available
to the Administrative Agent. Such borrowing will then be made available to the
Borrower by the Administrative Agent crediting the account of the Borrower on
the books of such office with the aggregate of the amounts made available to the
Administrative Agent by the Lenders and in like funds as received by the
Administrative Agent.

            2.3 [INTENTIONALLY OMITTED].

            2.4 [INTENTIONALLY OMITTED].

            2.5 FACILITY FEE. The Borrower agrees to pay to the Administrative
Agent for the account of each Lender a facility fee for the period from and
including the Fee Commencement Date to the Termination Date, computed at the
Facility Fee Rate on the average daily amount of the Commitment of such Lender
(regardless of usage) during the period for which payment is made, payable
quarterly in arrears on the last day of each March, June, September and
December, on the Termination Date or such earlier date on which the Commitments
shall terminate as provided herein, commencing on the first of such dates to
occur after the date hereof.

            2.6 TERMINATION OR REDUCTION OF COMMITMENTS. The Borrower shall have
the right, upon not less than five Business Days' notice to the Administrative
Agent, to terminate the Aggregate

                                       17
<PAGE>

Commitments or, from time to time, to reduce the amount of the Aggregate
Commitments; provided that no such termination or reduction shall be permitted
if, after giving effect thereto and to any prepayments of the Loans made on the
effective date thereof, the Total Outstandings would exceed the Aggregate
Commitments. Any such reduction shall be in an amount equal to $5,000,000 or a
whole multiple thereof and shall reduce permanently the Commitments then in
effect. The Administrative Agent shall give each Lender prompt notice of any
notice received from the Borrower pursuant to this subsection 2.6.

            2.7 REPAYMENT OF REVOLVING CREDIT LOANS. The Borrower hereby
unconditionally promises to pay to the Administrative Agent for the account of
each Lender the then unpaid principal amount of each Revolving Credit Loan of
such Lender on the Maturity Date (or such earlier date on which the Revolving
Credit Loans become due and payable pursuant to Section 10). The Borrower hereby
further agrees to pay interest on the unpaid principal amount of the Revolving
Credit Loans from time to time outstanding from the date hereof until payment in
full thereof at the rates per annum, and on the dates, set forth in subsection
3.4.

            2.8 CAF ADVANCES. Subject to the terms and conditions of this
Agreement, the Borrower may borrow CAF Advances in Dollars from time to time on
any Business Day during the CAF Advance Availability Period. CAF Advances may be
borrowed in amounts such that the amount of Total Outstandings of all Lenders at
any time shall not exceed the Aggregate Commitments at such time. Within the
limits and on the conditions hereinafter set forth with respect to CAF Advances,
the Borrower from time to time may borrow, repay and reborrow CAF Advances.

            2.9 PROCEDURE FOR CAF ADVANCE BORROWING. (a) The Borrower shall
request CAF Advances by delivering a CAF Advance Request to the Administrative
Agent, not later than 12:00 Noon (New York City time) four Business Days prior
to the proposed Borrowing Date (in the case of a LIBO Rate CAF Advance Request),
and not later than 10:00 A.M. (New York City time) one Business Day prior to the
proposed Borrowing Date (in the case of a Fixed Rate CAF Advance Request). Each
CAF Advance Request in respect of any Borrowing Date may solicit bids for CAF
Advances on such Borrowing Date in an aggregate principal amount of $5,000,000
or an integral multiple of $1,000,000 in excess thereof and having not more than
three alternative CAF Advance Maturity Dates. The CAF Advance Maturity Date for
each CAF Advance shall be the date set forth therefor in the relevant CAF
Advance Request, which date shall be (i) not less than 7 days nor more than 360
days after the Borrowing Date therefor, in the case of a Fixed Rate CAF Advance,
(ii) not less than one month nor more than twelve months after the Borrowing
Date therefor, in the case of a LIBO CAF Advance and (iii) not later than the
Termination Date, in the case of any CAF Advance. The Administrative Agent shall
notify each Lender promptly by facsimile transmission of the contents of each
CAF Advance Request received by the Administrative Agent.

            (b) In the case of a LIBO Rate CAF Advance Request, upon receipt of
notice from the Administrative Agent of the contents of such CAF Advance
Request, each Lender may elect, in its sole discretion, to offer irrevocably to
make one or more CAF Advances at the applicable Eurodollar Rate plus (or minus)
a margin determined by such Lender in its sole discretion for each such CAF
Advance. Any such irrevocable offer shall be made by delivering a CAF Advance
Offer to the Administrative Agent, before 10:30 A.M. (New York City time) on the
day that is three Business Days before the proposed Borrowing Date, setting
forth:

                                       18
<PAGE>

            (i) the maximum amount of CAF Advances for each CAF Advance Maturity
Date and the aggregate maximum amount of CAF Advances for all CAF Advance
Maturity Dates which such Lender would be willing to make (which amounts may,
subject to subsection 2.8, exceed such Lender's Commitment); and

            (ii) the margin above or below the applicable Eurodollar Rate at
which such Lender is willing to make each such CAF Advance.

The Administrative Agent shall advise the Borrower before 11:00 A.M. (New York
City time) on the date which is three Business Days before the proposed
Borrowing Date of the contents of each such CAF Advance Offer received by it. If
the Administrative Agent, in its capacity as a Lender, shall elect, in its sole
discretion, to make any such CAF Advance Offer, it shall advise the Borrower of
the contents of its CAF Advance Offer before 10:15 A.M. (New York City time) on
the date which is three Business Days before the proposed Borrowing Date.

            (c) In the case of a Fixed Rate CAF Advance Request, upon receipt of
notice from the Administrative Agent of the contents of such CAF Advance
Request, each Lender may elect, in its sole discretion, to offer irrevocably to
make one or more CAF Advances at a rate of interest determined by such Lender in
its sole discretion for each such CAF Advance. Any such irrevocable offer shall
be made by delivering a CAF Advance Offer to the Administrative Agent before
9:30 A.M. (New York City time) on the Borrowing Date, setting forth:

                  (i) the maximum amount of CAF Advances for each CAF Advance
            Maturity Date, and the aggregate maximum amount for all CAF Advance
            Maturity Dates, which such Lender would be willing to make (which
            amounts may, subject to subsection 2.8, exceed such Lender's
            Commitment); and

                  (ii) the rate of interest at which such Lender is willing to
            make each such CAF Advance.

The Administrative Agent shall advise the Borrower before 10:00 A.M. (New York
City time) on the proposed Borrowing Date of the contents of each such CAF
Advance Offer received by it. If the Administrative Agent, in its capacity as a
Lender, shall elect, in its sole discretion, to make any such CAF Advance Offer,
it shall advise the Borrower of the contents of its CAF Advance Offer before
9:15 A.M. (New York City time) on the proposed Borrowing Date.

            (d) Before 11:30 A.M. (New York City time) three Business Days
before the proposed Borrowing Date (in the case of CAF Advances requested by a
LIBO Rate CAF Advance Request) and before 10:30 A.M. (New York City time) on the
proposed Borrowing Date (in the case of CAF Advances requested by a Fixed Rate
CAF Advance Request), the Borrower, in its absolute discretion, shall:

                  (i) cancel such CAF Advance Request by giving the
            Administrative Agent telephone notice to that effect, or

                  (ii) by giving telephone notice to the Administrative Agent
            (immediately confirmed by delivery to the Administrative Agent of a
            CAF Advance Confirmation by facsimile transmission) (A) subject to
            the provisions of subsection 2.9(e), accept one or more of the
            offers made by any Lender or Lenders pursuant to subsection

                                       19
<PAGE>

            2.9(b) or subsection 2.9(c), as the case may be, and (B) reject any
            remaining offers made by Lenders pursuant to subsection 2.9(b) or
            subsection 2.9(c), as the case may be.

            (e) The Borrower's acceptance of CAF Advances in response to any CAF
Advance Offers shall be subject to the following limitations:

                  (i) the amount of CAF Advances accepted for each CAF Advance
            Maturity Date specified by any Lender in its CAF Advance Offer shall
            not exceed the maximum amount for such CAF Advance Maturity Date
            specified in such CAF Advance Offer;

                  (ii) the aggregate amount of CAF Advances accepted for all CAF
            Advance Maturity Dates specified by any Lender in its CAF Advance
            Offer shall not exceed the aggregate maximum amount specified in
            such CAF Advance Offer for all such CAF Advance Maturity Dates;

                  (iii) the Borrower may not accept offers for CAF Advances for
            any CAF Advance Maturity Date in an aggregate principal amount in
            excess of the maximum principal amount requested in the related CAF
            Advance Request; and

                  (iv) if the Borrower accepts any of such offers, it must
            accept offers based solely upon pricing for each relevant CAF
            Advance Maturity Date and upon no other criteria whatsoever, and if
            two or more Lenders submit offers for any CAF Advance Maturity Date
            at identical pricing and the Borrower accepts any of such offers but
            does not wish to (or, by reason of the limitations set forth in
            subsection 2.8, cannot) borrow the total amount offered by such
            Lenders with such identical pricing, the Borrower shall accept
            offers from all of such Lenders in amounts allocated among them pro
            rata according to the amounts offered by such Lenders (with
            appropriate rounding, in the sole discretion of the Borrower, to
            assure that each accepted CAF Advance is an integral multiple of
            $1,000,000); provided that if the number of Lenders that submit
            offers for any CAF Advance Maturity Date at identical pricing is
            such that, after the Borrower accepts such offers pro rata in
            accordance with --- ---- the foregoing provisions of this paragraph,
            the CAF Advance to be made by any such Lender would be less than
            $5,000,000 principal amount, the number of such Lenders shall be
            reduced by the Administrative Agent by lot until the CAF Advances to
            be made by each such remaining Lender would be in a principal amount
            of $5,000,000 or an integral multiple of $1,000,000 in excess
            thereof.

            (f) If the Borrower notifies the Administrative Agent that a CAF
Advance Request is cancelled pursuant to subsection 2.9(d)(i), the
Administrative Agent shall give prompt telephone notice thereof to the Lenders.

            (g) If the Borrower accepts pursuant to subsection 2.9(d)(ii) one or
more of the offers made by any Lender or Lenders, the Administrative Agent
promptly shall notify each Lender which has made such an offer of (i) the
aggregate amount of such CAF Advances to be made on such Borrowing Date for each
CAF Advance Maturity Date and (ii) the acceptance or rejection of any offers to
make such CAF Advances made by such Lender. Before 12:00 Noon (New York City
time) on the Borrowing Date specified in the applicable CAF Advance Request,
each

                                       20
<PAGE>

Lender whose CAF Advance Offer has been accepted shall make available to
the Administrative Agent the amount of CAF Advances to be made by such Lender,
in immediately available funds, at the New York office of the Administrative
Agent specified in Section 13.2. The Administrative Agent will make such funds
available to the Borrower as soon as practicable on such date at such office of
the Administrative Agent. As soon as practicable after each Borrowing Date, the
Administrative Agent shall notify each Lender of the aggregate amount of CAF
Advances advanced on such Borrowing Date and the respective CAF Advance Maturity
Dates thereof.

            2.10 REPAYMENT OF CAF ADVANCES. The Borrower hereby unconditionally
promises to pay to the Administrative Agent, for the account of each Lender
which has made a CAF Advance, on the applicable CAF Advance Maturity Date the
then unpaid principal amount of such CAF Advance. The Borrower shall have the
right to prepay any principal amount of any CAF Advance only with the consent of
the Lender to which such CAF Advance is owed. The Borrower hereby further agrees
to pay interest on the unpaid principal amount of each CAF Advance from the
Borrowing Date to the applicable CAF Advance Maturity Date at the rate of
interest specified in the CAF Advance Offer accepted by the Borrower in
connection with such CAF Advance (calculated on the basis of a 360-day year for
actual days elapsed), payable on each applicable CAF Advance Interest Payment
Date.

            2.11 CERTAIN RESTRICTIONS WITH RESPECT TO CAF ADVANCES. A CAF
Advance Request may request offers for CAF Advances to be made on not more than
one Borrowing Date and to mature on not more than three CAF Advance Maturity
Dates. No CAF Advance Request may be submitted earlier than five Business Days
after submission of any other CAF Advance Request.

            2.12 [INTENTIONALLY OMITTED].

            2.13 [INTENTIONALLY OMITTED].

            2.14 [INTENTIONALLY OMITTED].

            2.15 [INTENTIONALLY OMITTED].

            2.16 [INTENTIONALLY OMITTED].

            2.17 [INTENTIONALLY OMITTED].


                                    SECTION 3
                   CERTAIN PROVISIONS APPLICABLE TO THE LOANS

3.1 OPTIONAL AND MANDATORY PREPAYMENTS. (a) The Borrower may at any time and
from time to time prepay the Revolving Credit Loans, in whole or in part,
without premium or penalty (other than any amounts payable pursuant to
subsection 3.11 if such prepayment is of Eurodollar Loans and is made on a day
other than the last day of the Interest Period with respect thereto), upon at
least four Business Days' irrevocable notice to the Administrative Agent,
specifying the date and amount of prepayment and whether the prepayment is of
Eurodollar Loans, ABR Loans or a combination thereof, and, if of a combination
thereof, the amount

                                       21
<PAGE>

allocable to each. Upon receipt of any such notice the Administrative Agent
shall promptly notify each Lender thereof. If any such notice is given, the
amount specified in such notice shall be due and payable on the date specified
therein.

            (b) [Intentionally omitted].

            (c) (i) If, at any time during the Commitment Period, for any reason
the Total Outstandings of all Lenders exceed the Aggregate Commitments then in
effect, the Borrower shall, without notice or demand, immediately prepay the
Revolving Credit Loans in amounts such that the aggregate principal amount of
the Revolving Credit Loans so prepaid equals or exceeds the amount of such
excess.

                  (ii) [Intentionally omitted].

                  (iii) Each prepayment of Loans pursuant to this subsection
            3.1(c) shall be accompanied by any amounts payable under subsection
            3.11 in connection with such prepayment.

                  (iv) [Intentionally omitted].

            3.2 CONVERSION AND CONTINUATION OPTIONS. (a) The Borrower may elect
from time to time to convert Eurodollar Loans to ABR Loans by giving the
Administrative Agent at least two Business Days' prior irrevocable notice of
such election. The Borrower may elect from time to time to convert ABR Loans to
Eurodollar Loans by giving the Administrative Agent at least three Business
Days' prior irrevocable notice of such election. Any such notice of conversion
to Eurodollar Loans shall specify the length of the initial Interest Period
therefor. Upon receipt of any such notice the Administrative Agent shall
promptly notify each Lender thereof. All or any part of outstanding Eurodollar
Loans and ABR Loans may be converted as provided herein, provided that (i) no
Loan may be converted into a Eurodollar Loan when any Event of Default has
occurred and is continuing and the Administrative Agent has or the Majority
Lenders have determined that such a conversion is not appropriate and (ii) no
Loan may be converted into a Eurodollar Loan after the date that is one month
prior to the Termination Date.

            (b) Any Eurodollar Loans may be continued as such upon the
expiration of the then current Interest Period with respect thereto by the
Borrower giving notice to the Administrative Agent, in accordance with the
applicable provisions of the term "Interest Period" set forth in subsection 1.1,
of the length of the next Interest Period to be applicable to such Loans,
provided that no Eurodollar Loan may be continued as such (i) when any Event of
Default has occurred and is continuing and the Administrative Agent has or the
Majority Lenders have determined that such a continuation is not appropriate or
(ii) after the date that is one month prior to the Termination Date, and
provided, further, that if the Borrower shall fail to give such notice or if
such continuation is not permitted, such Loans shall be automatically converted
to ABR Loans on the last day of such then expiring Interest Period.

            (c) [Intentionally omitted].

            3.3 MINIMUM AMOUNTS AND MAXIMUM NUMBER OF TRANCHES. All borrowings,
conversions and continuations of Revolving Credit Loans hereunder and all
selections of Interest

                                       22
<PAGE>

Periods hereunder shall be in such amounts and be made pursuant to such
elections so that, after giving effect thereto, the aggregate principal amount
of the Eurodollar Loans comprising each Eurodollar Tranche shall be equal to
$5,000,000 or a whole multiple of $1,000,000 in excess thereof. In no event
shall there be more than seven Tranches outstanding at any time.

            3.4 INTEREST RATES AND PAYMENT DATES. (a) Each Eurodollar Loan shall
bear interest for each day during each Interest Period with respect thereto at a
rate per annum equal to the Eurodollar Rate determined for such Interest Period
plus the Applicable Margin in effect for such day.

            (b) Each ABR Loan shall bear interest at a rate per annum equal to
the ABR plus the Applicable Margin.

            (c) [Intentionally omitted].

            (d) Each CAF Advance shall bear interest at the rate determined in
accordance with subsection 2.9.

            (e) If all or a portion of (i) any principal of any Loan, (ii) any
interest payable thereon, (iii) any facility fee or (iv) any other amount
payable hereunder shall not be paid when due (whether at the stated maturity, by
acceleration or otherwise), the principal of the Loans and/or any such overdue
interest, commitment fee or other amount shall bear interest at a rate per annum
which is (x) in the case of principal, the rate that would otherwise be
applicable thereto pursuant to the foregoing provisions of this subsection plus
2% or (y) in the case of any such overdue interest, facility fee or other
amount, the rate described in paragraph (b) of this subsection plus 2%, in each
case from the date of such non-payment until such overdue principal, interest,
facility fee or other amount is paid in full (as well after as before judgment).

            (f) Interest pursuant to this subsection shall be payable in arrears
on each Interest Payment Date or CAF Advance Interest Payment Date, as the case
may be, provided that interest accruing pursuant to paragraph (e) of this
subsection shall be payable from time to time on demand.

            3.5 COMPUTATION OF INTEREST AND FEES. (a) Whenever it is calculated
on the basis of the Prime Rate, interest shall be calculated on the basis of a
365- (or 366-, as the case may be) day year for the actual days elapsed; and,
otherwise, interest and fees shall be calculated on the basis of a 360-day year
for the actual days elapsed. The Administrative Agent shall as soon as
practicable notify the Borrower and the Lenders of each determination of a
Eurodollar Rate. Any change in the interest rate on a Loan resulting from a
change in the ABR, the Eurodollar Reserve Requirements, the C/D Assessment Rate
or the C/D Reserve Percentage shall become effective as of the opening of
business on the day on which such change becomes effective. The Administrative
Agent shall as soon as practicable notify the Borrower and the Lenders of the
effective date and the amount of each such change in interest rate.

            (b) Each determination of an interest rate by the Administrative
Agent pursuant to any provision of this Agreement shall be conclusive and
binding on the Borrower and the Lenders in the absence of manifest error. The
Administrative Agent shall, at the request of the

                                       23
<PAGE>

Borrower, deliver to the Borrower a statement showing the quotations used by the
Administrative Agent in determining any interest rate pursuant to subsections
3.4(a), (b) or (d).

            (c) If any Reference Lender shall for any reason no longer have a
Commitment or any Loans, such Reference Lender shall thereupon cease to be a
Reference Lender, and if, as a result, there shall only be one Reference Lender
remaining, the Administrative Agent (after consultation with the Lenders and
with the consent of the Borrower (which consent shall not be unreasonably
withheld)) shall, by notice to the Borrower and the Lenders, designate another
Lender as a Reference Lender so that there shall at all times be at least two
Reference Lenders.

            (d) Each Reference Lender shall use its best efforts to furnish
quotations of rates to the Administrative Agent as contemplated hereby. If any
of the Reference Lenders shall be unable or shall otherwise fail to supply such
rates to the Administrative Agent upon its request, the rate of interest shall,
subject to the provisions of subsection 3.6, be determined on the basis of the
quotations of the remaining Reference Lenders or Reference Lender.

            3.6 INABILITY TO DETERMINE INTEREST RATE. If prior to the first day
of any Interest Period:

            (a) the Administrative Agent shall have determined (which
determination shall be conclusive and binding upon the Borrower) that, by reason
of circumstances affecting the relevant market, adequate and reasonable means do
not exist for ascertaining the Eurodollar Rate for such Interest Period, or

            (b) the Administrative Agent shall have received notice from the
Majority Lenders that the Eurodollar Rate determined or to be determined for
such Interest Period will not adequately and fairly reflect the cost to such
Lenders (as conclusively certified by such Lenders) of making or maintaining
their affected Loans during such Interest Period, the Administrative Agent shall
give telecopy or telephonic notice thereof to the Borrower and the Lenders as
soon as practicable thereafter. If such notice is given (x) any Eurodollar Loans
requested to be made on the first day of such Interest Period shall be made as
ABR Loans, provided, that, notwithstanding the provisions of subsection 2.2, the
Borrower may cancel the request for such Eurodollar Loan by written notice to
the Administrative Agent one Business Day prior to the first day of such
Interest Period and the Borrower shall not be subject to any liability pursuant
to subsection 3.11 with respect to such cancelled request, (y) any Loans that
were to have been converted on the first day of such Interest Period to
Eurodollar Loans shall be continued as ABR Loans, and (z) any outstanding
Eurodollar Loans shall be converted, on the first day of such Interest Period,
to ABR Loans. Until such notice has been withdrawn by the Administrative Agent,
no further Eurodollar Loans shall be made or continued as such, nor shall the
Borrower have the right to convert ABR Loans to Eurodollar Loans.

            3.7 PRO RATA TREATMENT AND PAYMENTS. (a) Each payment of principal
or interest in respect of the Loans shall be made pro rata according to the
amounts then due and owing to the respective Lenders.

            (b) Each borrowing by the Borrower of Revolving Credit Loans from
the Lenders hereunder shall be made pro rata according to the Funding Commitment
Percentages of the

                                       24
<PAGE>

Lenders in effect on the date of such borrowing. Each payment by the Borrower on
account of any facility fee hereunder and any reduction of the Aggregate
Commitments of the Lenders shall be allocated by the Administrative Agent among
the Lenders pro rata according to the Commitment Percentages of the Lenders.
Each payment (including each prepayment) by the Borrower on account of principal
of and interest on the Revolving Credit Loans shall be made pro rata according
to the respective outstanding principal amounts of the Revolving Credit Loans
then due and owing to the Lenders. All payments (including prepayments) to be
made by the Borrower hereunder, whether on account of principal, interest, fees
or otherwise, shall be made without set off or counterclaim and shall be made
prior to 12:00 Noon, New York City time, on the due date thereof to the
Administrative Agent, for the account of the Lenders, at the Administrative
Agent's office specified in subsection 13.2, in immediately available funds. The
Administrative Agent shall distribute such payments to the Lenders promptly upon
receipt in like funds as received. If any payment hereunder (other than payments
on the Eurodollar Loans) becomes due and payable on a day other than a Business
Day, such payment shall be extended to the next succeeding Business Day, and,
with respect to payments of principal, interest thereon shall be payable at the
then applicable rate during such extension. If any payment on a Eurodollar Loan
becomes due and payable on a day other than a Business Day, the maturity of such
payment shall be extended to the next succeeding Business Day (and, with respect
to payments of principal, interest thereon shall be payable at the then
applicable rate during such extension) unless the result of such extension would
be to extend such payment into another calendar month, in which event such
payment shall be made on the immediately preceding Business Day.

            (c) [Intentionally omitted].

            (d) Unless the Administrative Agent shall have been notified in
writing by any Lender prior to a borrowing that such Lender will not make the
amount that would constitute its share of such borrowing available to the
Administrative Agent, the Administrative Agent may assume that such Lender is
making such amount available to the Administrative Agent, and the Administrative
Agent may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. If such amount is not made available to the Administrative
Agent by the required time on the Borrowing Date therefor, such Lender shall pay
to the Administrative Agent, on demand, such amount with interest thereon at a
rate equal to the daily average Federal Funds Effective Rate for the period
until such Lender makes such amount immediately available to the Administrative
Agent. A certificate of the Administrative Agent submitted to any Lender with
respect to any amounts owing under this subsection shall be conclusive in the
absence of manifest error. If such Lender's share of such borrowing is not made
available to the Administrative Agent by such Lender within three Business Days
of such Borrowing Date, the Administrative Agent shall also be entitled to
recover such amount with interest thereon equal to the rate per annum applicable
to ABR Loans hereunder.

            3.8 ILLEGALITY. Notwithstanding any other provision herein, if after
the date hereof the adoption of or any change in any Requirement of Law or in
the interpretation or application thereof shall make it unlawful for any Lender
to make or maintain Eurodollar Loans as contemplated by this Agreement, (a) the
commitment of such Lender hereunder to make Eurodollar Loans, continue
Eurodollar Loans as such and convert ABR Loans to Eurodollar Loans shall
forthwith be cancelled, and (b) such Lender's Loans then outstanding as
Eurodollar

                                       25
<PAGE>

Loans, if any, shall be converted automatically to ABR Loans on the respective
last days of the then current Interest Periods with respect to such Loans or
within such earlier period as required by law. If any such conversion of a
Eurodollar Loan occurs on a day which is not the last day of the then current
Interest Period with respect thereto, the Borrower shall pay to such Lender such
amounts, if any, as may be required pursuant to subsection 3.11.

            3.9 REQUIREMENTS OF LAW. (a) If the adoption of or any change in any
Requirement of Law or in the interpretation or application thereof or compliance
by any Lender with any request or directive (whether or not having the force of
law) from any central bank or other Governmental Authority made subsequent to
the date hereof (or, in the case of LIBO Rate CAF Advances, made subsequent to
acceptance by the Borrower of such LIBO Rate CAF Advance):

                  (i) shall subject any Lender to any tax of any kind whatsoever
            with respect to this Agreement, any Note, any Eurodollar Loan or any
            LIBO Rate CAF Advance made by it, or change the basis of taxation of
            payments to such Lender in respect thereof (except for Non-Excluded
            Taxes covered by subsection 3.10 and changes in the rate of tax on
            the overall net income of such Lender);

                  (ii) shall impose, modify or hold applicable any reserve,
            special deposit, compulsory loan or similar requirement against
            assets held by, deposits or other liabilities in or for the account
            of, advances, loans or other extensions of credit by, or any other
            acquisition of funds by, any office of such Lender which is not
            otherwise included in the determination of the Eurodollar Rate; or

                  (iii) shall impose on such Lender any other condition;

and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans, LIBO Rate CAF Advances or to reduce
any amount receivable hereunder in respect thereof, then, in any such case, the
Borrower shall promptly pay such Lender such additional amount or amounts as
will compensate such Lender for such increased cost or reduced amount
receivable; provided, that the Borrower shall not be required to pay to any
Lender any amounts under this paragraph for any period prior to the date on
which such Lender gives notice to the Borrower that such amounts are payable
unless such Lender gives such notice within 180 days after it became aware or
should have become aware of the event giving rise to such payment obligation.

            (b) If any Lender shall have determined that after the date hereof
the adoption of or any change in any Requirement of Law regarding capital
adequacy or in the interpretation or application thereof or compliance by such
Lender or any corporation controlling such Lender with any request or directive
regarding capital adequacy (whether or not having the force of law) from any
Governmental Authority made subsequent to the date hereof shall have the effect
of reducing the rate of return on such Lender's or such corporation's capital as
a consequence of its obligations hereunder to a level below that which such
Lender or such corporation could have achieved but for such adoption, change or
compliance (taking into consideration such Lender's or such corporation's
policies with respect to capital adequacy) by an amount deemed by such Lender to
be material, then from time to time, the Borrower shall promptly pay to such
Lender

                                       26
<PAGE>

such additional amount or amounts as will compensate such Lender for such
reduction; provided, that the Borrower shall not be required to pay to any
Lender any amounts under this paragraph for any period prior to the date on
which such Lender gives notice to the Borrower that such amounts are payable
unless such Lender gives such notice within 180 days after it became aware or
should have become aware of the event giving rise to such payment obligation.

            (c) If any Lender becomes entitled to claim any additional amounts
pursuant to this subsection, it shall promptly notify the Borrower (with a copy
to the Administrative Agent) of the event by reason of which it has become so
entitled. A certificate as to any additional amounts payable pursuant to this
subsection submitted by such Lender to the Borrower (with a copy to the
Administrative Agent) shall be conclusive in the absence of manifest error. The
agreements in this subsection shall survive the termination of this Agreement
and the payment of the Loans and all other amounts payable hereunder.

            3.10 TAXES. (a) All payments made by the Borrower under any Loan
Document shall be made free and clear of, and without deduction or withholding
for or on account of, any present or future income, stamp or other taxes,
levies, imposts, duties, charges, fees, deductions or withholdings, now or
hereafter imposed, levied, collected, withheld or assessed by any Governmental
Authority, excluding net income taxes and franchise taxes (imposed in lieu of
net income taxes) imposed on the Administrative Agent or any Lender as a result
of a present or former connection between the Administrative Agent or such
Lender and the jurisdiction of the Governmental Authority imposing such tax or
any political subdivision or taxing authority thereof or therein (other than any
such connection arising solely from the Administrative Agent or such Lender
having executed, delivered or performed its obligations or received a payment
under, or enforced, any Loan Document). If any such non-excluded taxes, levies,
imposts, duties, charges, fees, deductions or withholdings ("Non-Excluded
Taxes") are required to be withheld from any amounts payable to the
Administrative Agent or any Lender hereunder or under any Loan Document, the
amounts so payable to the Administrative Agent or such Lender shall be increased
to the extent necessary to yield to the Administrative Agent or such Lender
(after payment of all Non-Excluded Taxes) interest or any such other amounts
payable hereunder at the rates or in the amounts specified in such Loan
Document; provided, however, that the Borrower shall not be required to increase
any such amounts payable to any Lender that is not organized under the laws of
the United States of America or a state thereof if such Lender fails to comply
with the requirements of paragraph (b) of this subsection. Whenever any
Non-Excluded Taxes are payable by the Borrower, as promptly as possible
thereafter the Borrower shall send to the Administrative Agent for its own
account or for the account of such Lender, as the case may be, a certified copy
of an original official receipt received by the Borrower showing payment
thereof. If the Borrower fails to pay any Non-Excluded Taxes when due to the
appropriate taxing authority or fails to remit to the Administrative Agent the
required receipts or other required documentary evidence, the Borrower shall
indemnify the Administrative Agent and the Lenders for any incremental taxes,
interest or penalties that may become payable by the Administrative Agent or any
Lender as a result of any such failure. The agreements in this subsection shall
survive the termination of this Agreement and each other Loan Document and the
payment of the Loans and all other amounts payable hereunder and thereunder.

(b) Each Lender (or Transferee) that is not a citizen or resident of the United
States of America, a corporation, partnership or other entity created or
organized in or under the laws of

                                       27
<PAGE>

the United States of America (or any jurisdiction thereof), or any estate or
trust that is subject to federal income taxation regardless of the source of its
income (a "Non-U.S. Lender") shall deliver to the Borrower and the
Administrative Agent (or, in the case of a Participant, to the Lender from which
the related participation shall have been purchased) two copies of either U.S.
Internal Revenue Service Form W-8BEN or Form W-8ECI, or, in the case of a
Non-U.S. Lender claiming exemption from U.S. federal withholding tax under
Section 871(h) or 881(c) of the Code with respect to payments of "portfolio
interest" a statement substantially in the form of Exhibit I and a Form W-8BEN,
or any subsequent versions thereof or successors thereto properly completed and
duly executed by such Non-U.S. Lender claiming complete exemption from, or a
reduced rate of, U.S. federal withholding tax on all payments by the Borrower
under this Agreement and the other Loan Documents. Such forms shall be delivered
by each Non-U.S. Lender on or before the date it becomes a party to any Loan
Document (or, in the case of any Participant, on or before the date such
Participant purchases the related participation). In addition, each Non-U.S.
Lender shall deliver such forms promptly upon the obsolescence or invalidity of
any form previously delivered by such Non-U.S. Lender. Each Non-U.S. Lender
shall promptly notify the Borrower at any time it determines that it is no
longer in a position to provide any previously delivered certificate to the
Borrower (or any other form of certification adopted by the U.S. taxing
authorities for such purpose). Notwithstanding any other provision of this
paragraph, a Non-U.S. Lender shall not be required to deliver any form pursuant
to this paragraph that such Non-U.S. Lender is not legally able to deliver.

            (c) A Lender that is entitled to an exemption from or reduction of
non-U.S. withholding tax under the law of the jurisdiction in which the Borrower
is located, or any treaty to which such jurisdiction is a party, with respect to
payments under this Agreement shall deliver to the Borrower (with a copy to the
Administrative Agent), at the time or times prescribed by applicable law or
reasonably requested by the Borrower, such properly completed and executed
documentation prescribed by applicable law as will permit such payments to be
made without withholding or at a reduced rate, provided that such Lender is
legally entitled to complete, execute and deliver such documentation and in such
Lender's reasonable judgment such completion, execution or submission would not
materially prejudice the legal position of such Lender.

            3.11 INDEMNITY. The Borrower agrees to indemnify each Lender and to
hold each Lender harmless from any loss or expense which such Lender may sustain
or incur as a consequence of (a) default by the Borrower in making a borrowing
of, conversion into or continuation of Eurodollar Loans or CAF Advances after
the Borrower has given a notice requesting the same in accordance with the
provisions of this Agreement or (b) the making of a prepayment of Eurodollar
Loans or CAF Advances or the conversion of Eurodollar Loans to ABR Loans on a
day which is not the last day of an Interest Period with respect thereto. Such
indemnification may include an amount equal to the excess, if any, of (i) the
amount of interest which would have accrued on the amount so prepaid, or not so
borrowed, converted or continued, for the period from the date of such
prepayment or of such failure to borrow, convert or continue to the last day of
such Interest Period (or, in the case of a failure to borrow, convert or
continue, the Interest Period that would have commenced on the date of such
failure) or, in the case of CAF Advances, the applicable CAF Advance Maturity
Date (or proposed CAF Advance Maturity Date), in each case at the applicable
rate of interest for such Loans provided for herein (excluding, however, the
Applicable Margin or any positive margin applicable to CAF Advances

                                       28
<PAGE>

included therein, if any) over (ii) the amount of interest (as reasonably
determined by such Lender) which would have accrued to such Lender on such
amount by placing such amount on deposit for a comparable period with leading
banks in the interbank eurodollar market. This covenant shall survive the
termination of this Agreement and each other Loan Document and the payment of
the Loans and all other amounts payable hereunder and thereunder.

            3.12 CHANGE OF LENDING OFFICE; REMOVAL OF LENDER. Each Lender agrees
that if it makes any demand for payment under subsection 3.9 or 3.10(a), or if
any adoption or change of the type described in subsection 3.8 shall occur with
respect to it, (i) it will use reasonable efforts (consistent with its internal
policy and legal and regulatory restrictions and so long as such efforts would
not be disadvantageous to it, as determined in its sole discretion) to designate
a different lending office if the making of such a designation would reduce or
obviate the need for the Borrower to make payments under subsection 3.9 or
3.10(a), or would eliminate or reduce the effect of any adoption or change
described in subsection 3.8 or (ii) it will, upon at least five Business Days'
notice from the Borrower to such Lender and the Administrative Agent, assign,
pursuant to and in accordance with the provisions of subsection 13.6(c), to one
or more Assignees designated by the Borrower all, but not less than all, of such
Lender's rights and obligations hereunder (other than rights in respect of such
Lender's outstanding CAF Advance), without recourse to or warranty by, or
expense to, such Lender, for a purchase price equal to the outstanding principal
amount of each Revolving Credit Loan then owing to such Lender plus any accrued
but unpaid interest thereon and any accrued but unpaid facility fees and
utilization fees owing thereto and, in addition, all additional costs and
reimbursements, expense reimbursements and indemnities, if any, owing in respect
of such Lender's Commitment hereunder at such time (including any amount that
would be payable under subsection 3.11 if such assignment were, instead, a
prepayment in full of all amounts owing to such Lender) shall be paid to such
Lender.

            3.13 EVIDENCE OF DEBT. (a) Each Lender shall maintain in accordance
with its usual practice an account or accounts evidencing indebtedness of the
Borrower to such Lender resulting from each Loan of such Lender from time to
time, including the amounts of principal and interest payable and paid to such
Lender from time to time under this Agreement.

            (b) The Administrative Agent shall maintain the Register pursuant to
subsection 13.6(d), and a subaccount therein for each Lender, in which shall be
recorded (i) in the case of Revolving Credit Loans, the amount of each Revolving
Credit Loan made hereunder, the Type thereof and each Interest Period applicable
thereto, (ii) in the case of CAF Advances, the amount and currency of each CAF
Advance made hereunder, the CAF Advance Maturity Date thereof, the interest rate
applicable thereto and each CAF Advance Interest Payment Date applicable
thereto, (iii) the amount of any principal or interest due and payable or to
become due and payable from the Borrower to each Lender hereunder and (iv) both
the amount of any sum received by the Administrative Agent hereunder from the
Borrower and each Lender's share thereof.

            (c) The entries made in the Register and the accounts of each Lender
maintained pursuant to subsection 3.13(a) shall, to the extent permitted by
applicable law, be prima facie evidence of the existence and amounts of the
obligations of the Borrower therein recorded; provided, however, that the
failure of any Lender or the Administrative Agent to maintain the Register or
any such account, or any error therein, shall not in any manner affect the
obligation

                                       29
<PAGE>

of the Borrower to repay (with applicable interest) the Loans made to such
Borrower by such Lender in accordance with the terms of this Agreement.

            (d) The Borrower agrees that, upon the request to the Administrative
Agent by any Lender, the Borrower will execute and deliver to such Lender a
promissory note of the Borrower evidencing the Revolving Credit Loans of such
Lender, substantially in the form of Exhibit A with appropriate insertions as to
date and principal amount (a "Revolving Credit Note").

            (e) The Borrower agrees that, upon the request to the Administrative
Agent by any Lender, the Borrower will execute and deliver to such Lender a
promissory note of the Borrower evidencing the CAF Advances of such Lender,
substantially in the form of Exhibit B with appropriate insertions (a "CAF
Advance Note").

                                   SECTION 4
                            [INTENTIONALLY OMITTED].

                                   SECTION 5
                            [INTENTIONALLY OMITTED].

                                    SECTION 6
                         REPRESENTATIONS AND WARRANTIES

            To induce the Administrative Agent and the Lenders to enter into
this Agreement and to make the Loans, the Borrower hereby represents and
warrants to the Administrative Agent and each Lender that:

            6.1 FINANCIAL CONDITION. The consolidated balance sheet of the
Borrower and its consolidated Subsidiaries as at December 31, 2003 and December
31, 2002 and the related consolidated statements of operations and of cash flows
for the fiscal years ended on such dates, reported on by Ernst & Young LLP,
copies of which have heretofore been furnished to each Lender, are complete and
correct and present fairly the consolidated financial condition of the Borrower
and its consolidated Subsidiaries as at such dates, and the consolidated results
of their operations and their consolidated cash flows for the fiscal years then
ended. The unaudited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as at March 31, 2004 or, if later and prior to the
Signing Date, the date of the Borrower's most recent publicly available Form
10-Q and the related unaudited consolidated statements of operations and of cash
flows for the fiscal period ended on such date, certified by a Responsible
Officer, copies of which have heretofore been furnished to each Lender, are
complete and materially correct and present fairly (subject to normal year-end
audit adjustments) the consolidated financial condition of the Borrower and its
consolidated Subsidiaries as at such date, and the consolidated results of their
operations and their consolidated cash flows for the fiscal period then ended.
All such annual financial statements, including the related schedules and notes
thereto, were, as of the date prepared, prepared in accordance with GAAP applied
consistently throughout the periods involved (except as approved by such
accountants or Responsible Officer, as the case may be, and as disclosed
therein). The quarterly financial statements have been prepared in accordance
with generally accepted accounting principles for interim financial information
and with the instructions to Form 10-Q and Article 10 of Regulation S-X under
the Securities Act of 1933.

                                       30
<PAGE>

Accordingly, such quarterly statements do not include all of the information and
footnotes required by GAAP for complete financial statements. In the opinion of
the Borrower, all adjustments (consisting only of normal recurring accruals)
considered necessary for a fair presentation have been included. Neither the
Borrower nor any of its consolidated Subsidiaries had, at the date of the most
recent balance sheet referred to above, any material Guarantee Obligation,
material contingent liability or material liability for taxes, or any material
long-term lease or material unusual forward or long-term commitment, including,
without limitation, any interest rate or foreign currency swap or exchange
transaction, which is not reflected in the foregoing statements or in the notes
thereto.

            6.2 NO CHANGE. Since December 31, 2003, there has been no
development or event which has had or could reasonably be expected to have a
Material Adverse Effect.

            6.3 CORPORATE EXISTENCE; COMPLIANCE WITH LAW. Each of the Borrower
and its Subsidiaries (a) is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization, (b) has the
corporate power and authority, and the legal right, to own and operate its
property, to lease the property it operates as lessee and to conduct the
business in which it is currently engaged, (c) is duly qualified as a foreign
corporation and in good standing under the laws of each jurisdiction where its
ownership, lease or operation of property or the conduct of its business
requires such qualification and (d) is in compliance with all Requirements of
Law, except to the extent that the failure of the foregoing clauses (a) (only
with respect to Subsidiaries of the Borrower), (c) and (d) to be true and
correct could not, in the aggregate, reasonably be expected to have a Material
Adverse Effect.

            6.4 CORPORATE POWER; CONSENTS AND AUTHORIZATION; ENFORCEABLE
OBLIGATIONS. The Borrower has the corporate power and authority, and the legal
right, to make, deliver and perform the Loan Documents to which it is a party
and to borrow hereunder and has taken all necessary corporate action to
authorize the borrowings on the terms and conditions of this Agreement, any
Notes and to authorize the execution, delivery and performance of the Loan
Documents to which it is a party. No consent or authorization of, filing with,
notice to or other act by or in respect of, any Governmental Authority
(including, without limitation, exchange control) or any other Person is
required with respect to the Borrower or any of its Subsidiaries in connection
with the borrowings hereunder or with the execution, delivery, performance,
validity or enforceability of the Loan Documents to which the Borrower is a
party. This Agreement and each other Loan Document to which the Borrower is, or
is to become, a party has been or will be, duly executed and delivered on behalf
of the Borrower. This Agreement and each other Loan Document to which the
Borrower is, or is to become, a party constitutes or will constitute, a legal,
valid and binding obligation of the Borrower enforceable against the Borrower in
accordance with its terms, subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.

            6.5 NO LEGAL BAR. The execution, delivery and performance of the
Loan Documents, the borrowings hereunder and the use of the proceeds thereof
will not violate any Requirement of Law or Contractual Obligation of the
Borrower or of any of its Subsidiaries which could reasonably be expected to
have a Material Adverse Effect and will not result in, or require, the

                                       31
<PAGE>

creation or imposition of any Lien on any of its or their respective properties
or revenues pursuant to any such Requirement of Law or Contractual Obligation
which could reasonably be expected to have a Material Adverse Effect.

            6.6 NO MATERIAL LITIGATION. Except as disclosed in the Borrower's
Form 10-K dated December 31, 2003 or the Borrower's Form 10-Q dated March 31,
2004 or, if later and prior to the Signing Date, the date of the Borrower's most
recent publicly available Form 10-Q, no litigation, investigation or proceeding
of or before any arbitrator or Governmental Authority is pending or, to the
knowledge of the Borrower, threatened by or against the Borrower or any of its
Subsidiaries or against any of its or their respective properties or revenues
(a) with respect to any of the Loan Documents or any of the transactions
contemplated hereby, or (b) which could reasonably be expected to have a
Material Adverse Effect.

            6.7 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 which could reasonably be expected to have a Material Adverse Effect. No
Default or Event of Default has occurred and is continuing.

            6.8 INTELLECTUAL PROPERTY. Except as disclosed in the Borrower's
Form 10-K dated December 31, 2003 or the Borrower's Form 10-Q dated March 31,
2004 or, if later and prior to the Signing Date, the date of the Borrower's most
recent publicly available Form 10-Q, the Borrower and each of its Subsidiaries
owns, or is licensed to use, all trademarks, tradenames, copyrights, technology,
know-how and processes necessary for the conduct of its business as currently
conducted except for those the failure to own or license which could not
reasonably be expected to have a Material Adverse Effect (the "Intellectual
Property"). Except as disclosed in the Borrower's Form 10-K dated December 31,
2003 or the Borrower's Form 10-Q dated March 31, 2004 or, if later and prior to
the Signing Date, the date of the Borrower's most recent publicly available Form
10-Q, no claim has been asserted and is pending by any Person challenging or
questioning the use of any such Intellectual Property or the validity or
effectiveness of any such Intellectual Property, nor does the Borrower know of
any valid basis for any such claim, except for such claims that, in the
aggregate, could not reasonably be expected to have a Material Adverse Effect.
Except as disclosed in the Borrower's Form 10-K dated December 31, 2003 or the
Borrower's Form 10-Q dated March 31, 2004 or, if later and prior to the Signing
Date, the date of the Borrower's most recent publicly available Form 10-Q, the
use of such Intellectual Property by the Borrower and its Subsidiaries does not
infringe on the rights of any Person, except for such claims and infringements
that, in the aggregate, could not reasonably be expected to have a Material
Adverse Effect.

            6.9 TAXES. Each of the Borrower and its Subsidiaries has filed or
caused to be filed all tax returns which, to the knowledge of the Borrower, are
required to be filed and has paid all taxes shown to be due and payable on said
returns or on any assessments made against it (other than any the amount or
validity of which are currently being contested in good faith by appropriate
proceedings and with respect to which reserves in conformity with GAAP have been
provided on the books of the Borrower or its Subsidiaries, as the case may be),
except to the extent that the failure to do so could not reasonably be expected
to result in a Material Adverse Effect.

                                       32
<PAGE>

            6.10 FEDERAL REGULATIONS. No part of the proceeds of any Loans will
be used in any manner that would violate Regulation U of the Board as now and
from time to time hereafter in effect.

            6.11 ERISA. Neither a Reportable Event nor an "accumulated funding
deficiency" (within the meaning of Section 412 of the Code or Section 302 of
ERISA) has occurred during the five-year period prior to the date on which this
representation is made or deemed made with respect to any Plan other than a
Multiemployer Plan, and each Plan has complied in all material respects with the
applicable provisions of ERISA and the Code, where the liability could be
reasonably expected to result could have a Material Adverse Effect; provided,
however, that with respect to any Multiemployer Plan, such representation is
made only to the knowledge of the Borrower. No termination of a Single Employer
Plan pursuant to Section 4041(c) or 4042 of ERISA has occurred, and no Lien in
favor of the PBGC or a Plan has arisen, during such five-year period. The
present value of all accrued benefits under each Single Employer Plan (based on
those assumptions used to fund such Plans) did not, as of the last annual
valuation date prior to the date on which this representation is made or deemed
made, exceed the value of the assets of such Plan allocable to such accrued
benefits by a material amount. Neither the Borrower nor any Commonly Controlled
Entity has had a complete or partial withdrawal from any Multiemployer Plan and
to the knowledge of the Borrower, neither the Borrower nor any Commonly
Controlled Entity would become subject to any liability under ERISA if the
Borrower or any such Commonly Controlled Entity were to withdraw completely from
all Multiemployer Plans as of the valuation date most closely preceding the date
on which this representation is made or deemed made which liability could be
reasonably expected to result could have a Material Adverse Effect. No such
Multiemployer Plan is in Reorganization or Insolvent.

            6.12 INVESTMENT COMPANY ACT; OTHER REGULATIONS. The Borrower is not
an "investment company", or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended. The
Borrower is not subject to regulation under any Federal or State statute or
regulation (other than Regulation X of the Board) which limits its ability to
incur Indebtedness.

            6.13 PURPOSE OF LOANS. The proceeds of the Loans shall be used to
finance the working capital and general corporate needs of the Borrower and its
Subsidiaries, including, but not limited to, acquisitions.

            6.14 ENVIRONMENTAL MATTERS. Except to the extent that the failure of
the following statements to be true and correct could not reasonably be expected
to have a Material Adverse Effect:

            (a) The facilities and properties owned, leased or operated by the
Borrower or any of its Subsidiaries (the "Properties") do not contain, and have
not previously contained, any Materials of Environmental Concern in amounts or
concentrations which (i) constitute or constituted a violation of, or (ii) could
reasonably be expected to give rise to liability under, any Environmental Law.

                                       33
<PAGE>

            (b) The Properties and all operations at the Properties are in
compliance, and have in the last five years been in compliance, in all material
respects with all applicable Environmental Laws, and there is no contamination
at, under or about the Properties or violation of any Environmental Law with
respect to the Properties or the business operated by the Borrower or any of its
Subsidiaries (the "Business") which could reasonably be expected to materially
interfere with the continued operation of the Properties or materially impair
the fair saleable value thereof.

            (c) Neither the Borrower nor any of its Subsidiaries has received
any notice of violation, alleged violation, non-compliance, liability or
potential liability regarding environmental matters or compliance with
Environmental Laws with regard to any of the Properties or the Business, nor
does the Borrower have knowledge or reason to believe that any such notice will
be received or is being threatened.

            (d) Materials of Environmental Concern have not been transported or
disposed of from the Properties in violation of, or in a manner or to a location
which could reasonably be expected to give rise to liability under, any
Environmental Law, nor have any Materials of Environmental Concern been
generated, treated, stored or disposed of at, on or under any of the Properties
in violation of, or in a manner that could reasonably be expected to give rise
to liability under, any applicable Environmental Law.

            (e) No judicial proceeding or governmental or administrative action
is pending or, to the knowledge of the Borrower, threatened, under any
Environmental Law to which the Borrower or any Subsidiary is or will be named as
a party with respect to the Properties or the Business, nor are there any
consent decrees or other decrees, consent orders, administrative orders or other
orders, or other administrative or judicial requirements outstanding under any
Environmental Law with respect to the Properties or the Business.

            (f) There has been no release or threat of release of Materials of
Environmental Concern at or from the Properties, or arising from or related to
the operations of the Borrower or any Subsidiary in connection with the
Properties or otherwise in connection with the Business, in violation of or in
amounts or in a manner that could reasonably be expected to give rise to
liability under Environmental Laws.

            6.15 DISCLOSURE. The statements and information contained herein and
in any of the information provided to the Administrative Agent or the Lenders in
writing in connection with this Agreement, taken as a whole, do not contain any
untrue statement of any material fact, or omit to state a fact necessary in
order to make such statements or information not misleading in any material
respect, in each case in light of the circumstances under which such statements
were made or information provided as of the date so provided.


                                   SECTION 7
                              CONDITIONS PRECEDENT

            7.1 CONDITIONS TO INITIAL LOANS. The agreement of each Lender to
make the initial Loan requested to be made by it is subject to the satisfaction
on the Closing Date of the following conditions precedent:

                                       34
<PAGE>

            (a) Credit Agreement. The Administrative Agent shall have received
this Agreement, executed and delivered by a duly authorized officer of each
Lender and the Borrower, with a counterpart for each Lender and original Notes
executed by the Borrower in favor of each Lender requesting a Note.

            (b) Closing Certificate. The Administrative Agent shall have
received, with a counterpart for each Lender, a certificate of the Borrower,
dated the Closing Date, substantially in the form of Exhibit F, with appropriate
insertions and attachments, satisfactory in form and substance to the
Administrative Agent, executed by the President or any Vice President and the
Secretary or any Assistant Secretary of the Borrower.

            (c) Representations and Warranties. Each of the representations and
warranties made by the Borrower in or pursuant to the Loan Documents shall be
true and correct in all material respects on and as of the Closing Date as if
made on and as of the Closing Date.

            (d) Termination of Existing Credit Facilities. Evidence that all
principal amounts, interest, fees, and other amounts owed under the Existing
Credit Facilities on the Closing Date shall have been paid in full on the
Closing Date and all commitments and agreements with respect thereto shall have
been terminated.

            (e) Legal Opinion. The Administrative Agent shall have received,
with a counterpart for each Lender, the executed legal opinion of counsel to the
Borrower (which opinion may be delivered in part by in-house counsel to the
Borrower), covering the matters set forth in Exhibit G. Such legal opinion shall
cover such other matters incident to the transactions contemplated by this
Agreement as the Administrative Agent may reasonably require.

            (f) Approvals. All governmental and third party approvals necessary
in connection with the execution, delivery and performance of this Agreement and
the other Loan Documents shall have been obtained and be in full force and
effect.

            (g) Financial Statements; Pro Forma Projected Consolidated
Capitalization. The Lenders shall have received (i) satisfactory audited
consolidated financial statements of the Borrower and its consolidated
Subsidiaries for the two most recent fiscal years ended prior to the Closing
Date as to which such financial statements are available and (ii) satisfactory
unaudited interim consolidated financial statements of the Borrower and its
consolidated Subsidiaries for each quarterly period ended subsequent to the date
of the latest financial statements delivered pursuant to clause (i) of this
paragraph as to which such financial statements are available.

            (h) Fees. The Lenders and the Administrative Agent shall have
received all fees required to be paid and all expenses required to be paid by
the Borrower pursuant to the terms hereof and for which invoices have been
presented at least five (5) Business Days in advance, on or before the Closing
Date.

            7.2 CONDITIONS TO EACH LOAN. The agreement of each Lender to make
any Loan requested to be made by it on any date (including, without limitation,
its initial Loan) is subject to the satisfaction of the following conditions
precedent:

                                       35
<PAGE>

            (a) Representations and Warranties. Each of the representations and
warranties made by the Borrower in or pursuant to the Loan Documents shall be
true and correct in all material respects on and as of such date as if made on
and as of such date (other than, in the case of any Loan made after the Closing
Date, the representations and warranties in subsections 6.2, 6.6 and 6.8 which
shall be true and correct in all material respects on and as of the Closing
Date).

            (b) No Default. No Default or Event of Default shall have occurred
and be continuing on such date or after giving effect to the Loans requested to
be made.

Each borrowing by the Borrower hereunder shall constitute a representation and
warranty by the Borrower as of the date thereof that the conditions contained in
this subsection have been satisfied.

            7.3 CONDITIONS TO TERM-OUT. The extension of the Maturity Date
pursuant to the Term-Out is subject to the satisfaction of the following
conditions precedent:

            (a) Representations and Warranties. Each of the representations and
warranties made by the Borrower in or pursuant to the Loan Documents shall be
true and correct in all material respects on and as of the Termination Date as
if made on and as of such date (other than the representations and warranties in
subsections 6.2, 6.6 and 6.8).

            (b) No Default. No Default or Event of Default shall have occurred
and be continuing on the Termination Date.


                                    SECTION 8
                              AFFIRMATIVE COVENANTS

            The Borrower hereby agrees that, so long as the Commitments (or any
of them) remain in effect or any amount is owing to any Lender or the
Administrative Agent hereunder or under any other Loan Documents, the Borrower
shall and (except in the case of delivery of financial information, reports and
notices) shall cause each of its Subsidiaries to:

            8.1 FINANCIAL STATEMENTS. Furnish to each Lender:

            (a) as soon as available, but in any event not later than 20 days
after required to be filed with the Securities and Exchange Commission at the
end of each fiscal year of the Borrower, a copy of the consolidated balance
sheet of the Borrower and its consolidated Subsidiaries as at the end of such
year and the related consolidated statements of operations and stockholders'
equity and of cash flows for such year, setting forth in each case in
comparative form the figures for the previous year, reported on without a "going
concern" or like qualification or exception, or qualification arising out of the
scope of the audit, by Ernst & Young LLP or other independent certified public
accountants of nationally recognized standing;

            (b) as soon as available, but in any event not later 15 days after
required to be filed with the Securities and Exchange Commission at the end of
each of the first three quarterly periods of each fiscal year of the Borrower,
the unaudited consolidated balance sheet of the Borrower and its consolidated
Subsidiaries as at the end of such quarter and the related unaudited
consolidated statements of operations for such quarter and the portion of the
fiscal year through the end of such quarter and of cash flows of the Borrower
and its consolidated Subsidiaries for the portion of the fiscal year through

                                       36
<PAGE>

the end of such quarter, setting forth in each case in comparative form the
figures for the previous year, certified by a Responsible Officer as being
fairly stated in all material respects (subject to normal year-end audit
adjustments); and

            (c) all such financial statements shall be complete and correct in
all material respects and shall be prepared in reasonable detail and in
accordance with GAAP applied consistently throughout the periods reflected
therein and with prior periods (except as approved by such accountants or
officer, as the case may be, and disclosed therein); provided, that it is hereby
acknowledged that the quarterly financial statements delivered pursuant to
paragraph (b) above may not include all of the information and footnotes
required by GAAP for complete annual financial statements.

Any financial statement required to be furnished pursuant to this subsection 8.1
shall be deemed to have been furnished on the date on which the Lenders receive
notice that the Borrower has posted such financial statement on the Intralinks
website on the Internet at www.intralinks.com; provided that the Borrower shall
give notice of any such posting to the Administrative Agent (who shall then give
notice of any such posting to the Lenders). Notwithstanding the foregoing, the
Borrower shall deliver paper copies of any financial statement referred to in
this subsection 8.1 to the Administrative Agent if the Administrative Agent or
any Lender requests the Borrower to furnish such paper copies until written
notice to cease delivering such paper copies is given by the Administrative
Agent.

            8.2 CERTIFICATES; OTHER INFORMATION. Furnish to the Administrative
Agent with sufficient copies for the Lenders:

            (a) concurrently with the delivery of the financial statements
referred to in subsections 8.1(a) and 8.1(b), a certificate of a Responsible
Officer stating that such Officer has obtained no knowledge of any Default or
Event of Default that has occurred and is continuing except as specified in such
certificate, and including calculations demonstrating compliance with subsection
9.1;

            (b) within ten days after the same are sent, copies of all financial
statements and reports which the Borrower sends to its stockholders, and within
five days after the same are filed, copies of all financial statements and
reports which the Borrower may make to, or file with, the Securities and
Exchange Commission or any successor or analogous Governmental Authority, and
promptly after the same are issued, copies of all press releases issued by the
Borrower; and

            (c) promptly, such additional financial and other information as any
Lender may from time to time reasonably request.

            8.3 PAYMENT OF OBLIGATIONS. Pay, discharge or otherwise satisfy at
or before maturity or before they become delinquent, as the case may be, all its
material obligations of whatever nature, except where the amount or validity
thereof is currently being contested in good faith by appropriate proceedings
and reserves in conformity with GAAP with respect thereto have been provided on
the books of the Borrower or its Subsidiaries, as the case may be.

                                       37
<PAGE>

            8.4 CONDUCT OF BUSINESS AND MAINTENANCE OF EXISTENCE. (a) Continue
to engage in business of the same general type as conducted by it on the Signing
Date; (b) preserve, renew and keep in full force and effect its corporate
existence (except as could not in the aggregate be reasonably expected to have a
Material Adverse Effect); (c) take all reasonable action to maintain all rights,
privileges and franchises necessary or desirable in the normal conduct of its
business except as otherwise permitted pursuant to subsection 9.4; and (d)
comply with all Contractual Obligations and Requirements of Law except to the
extent that failure to comply therewith could not, in the aggregate, be
reasonably expected to have a Material Adverse Effect.

            8.5 MAINTENANCE OF PROPERTY; INSURANCE. Keep all property necessary
in its business in good working order and condition except to the extent that
failure to do so could not, in the aggregate, be reasonably expected to have a
Material Adverse Effect; maintain with financially sound and reputable insurance
companies insurance on all its property in at least such amounts and against at
least such risks as are adequate for conducting its business; and furnish to
each Lender, upon written request, full information as to the insurance carried.

            8.6 INSPECTION OF PROPERTY; BOOKS AND RECORDS; DISCUSSIONS. Keep
proper books of records and account in which full, true and correct entries in
conformity with GAAP and all Requirements of Law shall be made of all dealings
and transactions in relation to its business and activities; and permit
representatives of any Lender (upon reasonable advance notice coordinated
through the Administrative Agent) to visit and inspect any of its properties and
examine and make abstracts from any of its books and records at any reasonable
time and as often as may reasonably be desired and to discuss the business,
operations, properties and financial and other condition of the Borrower and its
Subsidiaries with officers and employees of the Borrower and its Subsidiaries
and with its independent certified public accountants.

            8.7 NOTICES. Promptly give notice to the Administrative Agent and
each Lender of:

            (a) the occurrence of any Default or Event of Default;

            (b) any (i) default or event of default under any Contractual
Obligation of the Borrower or any of its Subsidiaries or (ii) litigation,
investigation or proceeding which may exist at any time involving the Borrower
or any of its Subsidiaries, which in either case, could reasonably be expected
to have a Material Adverse Effect; and

            (c) the following events, as soon as possible and in any event
within 30 days after the Borrower knows or has reason to know thereof: (i) the
occurrence or expected occurrence of any Reportable Event with respect to any
Plan, a failure to make any required contribution to a Plan, the creation of any
Lien in favor of the PBGC or a Plan or any withdrawal from, or the termination,
Reorganization or Insolvency of, any Multiemployer Plan or (ii) the institution
of proceedings or the taking of any other action by the PBGC or the Borrower or
any Commonly Controlled Entity or any Multiemployer Plan with respect to the
withdrawal from, or the terminating, Reorganization or Insolvency of, any Plan,
other than the termination of any Single Employer Plan pursuant to Section
4041(b) of ERISA where, in connection with any of the foregoing, the amount of
liability the Borrower or any Commonly Controlled Entity could reasonably be
expected to incur would be material.

                                       38
<PAGE>

Each notice pursuant to this subsection shall be accompanied by a statement of a
Responsible Officer setting forth details of the occurrence referred to therein
and stating what action the Borrower proposes to take with respect thereto.


                                    SECTION 9
                               NEGATIVE COVENANTS

            The Borrower hereby agrees that, so long as the Commitments (or any
of them) remain in effect or any amount is owing to any Lender or the
Administrative Agent hereunder or under any other Loan Documents, the Borrower
shall not, and (except with respect to subsection 9.1) shall not permit any of
its Subsidiaries to, directly or indirectly:

            9.1 FINANCIAL COVENANT. Consolidated Leverage Ratio. Permit the
Consolidated Leverage Ratio as at the last day of any period of four consecutive
fiscal quarters of the Borrower to exceed 3.5 to 1.0.

            9.2 LIMITATION ON LIENS. Create, incur, assume or suffer to exist
any Lien upon any of its property, assets or revenues, whether now owned or
hereafter acquired, except for:

            (a) Liens for taxes not yet due or which are being contested in good
faith by appropriate proceedings, provided that adequate reserves with respect
thereto are maintained on the books of the Borrower or its Subsidiaries, as the
case may be, in conformity with GAAP;

            (b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's or other like Liens arising in the ordinary course of business which
are not overdue for a period of more than 60 days or which are being contested
in good faith by appropriate proceedings;

            (c) pledges or deposits in connection with workers' compensation,
unemployment insurance and other social security legislation and deposits
securing liability to insurance carriers under insurance or self-insurance
arrangements;

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

            (e) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business which, in the
aggregate, are not substantial in amount and which do not in any case materially
detract from the value of the property subject thereto or materially interfere
with the ordinary conduct of the business of the Borrower or such Subsidiary;

            (f) Liens in existence on the date hereof listed on Schedule 9.2,
provided that no such Lien is spread to cover any additional property after the
Closing Date and that the amount of Indebtedness secured thereby is not
increased;

            (g) Liens securing Indebtedness of the Borrower and its Subsidiaries
incurred to finance the acquisition of fixed or capital assets, provided that
(i) such Liens shall be created substantially simultaneously with the
acquisition of such fixed or capital assets, (ii) such Liens

                                       39
<PAGE>

do not at any time encumber any property other than the property financed by
such Indebtedness and (iii) the amount of Indebtedness secured thereby is not
increased;

            (h) Liens on the property or assets of a corporation which becomes a
Subsidiary after the date hereof, provided that (i) such Liens existed at the
time such corporation became a Subsidiary and were not created in anticipation
thereof, (ii) any such Lien is not spread to cover any property or assets of
such corporation after the time such corporation becomes a Subsidiary, and (iii)
the amount of Indebtedness secured thereby is not increased;

            (i) Liens created pursuant to any Receivables Transaction permitted
pursuant to subsection 9.3(a); and

            (j) Liens (not otherwise permitted hereunder) which secure
obligations not exceeding (as to the Borrower and all Subsidiaries) $100,000,000
in aggregate amount at any time.

            9.3 LIMITATION ON INDEBTEDNESS. Create, issue, incur, assume, become
liable in respect of or suffer to exist:

            (a) any Indebtedness pursuant to any Receivables Transaction, except
for Indebtedness pursuant to all Receivables Transactions in an aggregate
principal amount not exceeding 20% of Consolidated Tangible Assets; or

            (b) any Indebtedness of any of the Subsidiaries of the Borrower
other than (x) Indebtedness of any Receivables Subsidiary pursuant to any
Receivables Transaction permitted under subsection 9.3(a), (y) any Indebtedness
of any Subsidiary of the Borrower owing to the Borrower or to any other
Subsidiary of the Borrower and (z) any other Indebtedness of Subsidiaries of the
Borrower in an aggregate principal amount at any time outstanding not to exceed
20% of Consolidated Tangible Assets.

            9.4 LIMITATION ON FUNDAMENTAL CHANGES. Enter into any merger,
consolidation or amalgamation, or liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution), or convey, sell, lease, assign, transfer
or otherwise dispose of, all or substantially all of its property, business or
assets, except:

            (a) any Subsidiary of the Borrower may be merged or consolidated
with or into the Borrower (provided that the Borrower shall be the continuing or
surviving corporation) or with or into any one or more wholly owned Subsidiaries
of the Borrower (provided that the wholly owned Subsidiary or Subsidiaries shall
be the continuing or surviving corporation);

            (b) the Borrower or any wholly owned Subsidiary of the Borrower may
sell, lease, transfer or otherwise dispose of any or all of its assets (upon
voluntary liquidation or otherwise) to the Borrower or any other wholly owned
Subsidiary, and, so long as no Default or Event of Default shall have occurred
and be continuing or would occur as a result thereof, the Borrower or any
Subsidiary of the Borrower may sell, lease, transfer or otherwise dispose of any
or all of its assets (upon voluntary liquidation or otherwise) to any non-wholly
owned Subsidiary of the Borrower for fair market value;

                                       40
<PAGE>

            (c) any non-wholly owned Subsidiary of the Borrower may sell, lease,
transfer or otherwise dispose of any or all of its assets (upon voluntary
liquidation or otherwise) to the Borrower or any wholly owned Subsidiary of the
Borrower for fair market value or may sell, lease, transfer or otherwise dispose
of any or all of its assets (upon voluntary liquidation or otherwise) to any
other non-wholly owned Subsidiary of the Borrower; and

            (d) the Borrower or any Subsidiary of the Borrower may be merged or
consolidated with or into another Person; provided that the Borrower or such
Subsidiary shall be the continuing or surviving corporation and no Default or
Event of Default shall have occurred and be continuing or would occur as a
result thereof (and, in the case of any such transaction involving a Subsidiary,
such Subsidiary shall continue to be a Subsidiary or the Borrower shall have
received fair market value therefor as determined by the Board of Directors of
the Borrower); and provided further that the Borrower may not be merged or
consolidated with or into any Subsidiary.


                                   SECTION 10
                                EVENTS OF DEFAULT

            If any of the following events shall occur and be continuing:

            (a) The Borrower shall fail to pay any principal of any Loan when
due in accordance with the terms thereof or hereof; or the Borrower shall fail
to pay any interest on any Loan, or any fee or other amount payable hereunder,
within five days after any such interest or other amount becomes due in
accordance with the terms thereof or hereof; or

            (b) Any representation or warranty made or deemed made by the
Borrower herein or in any other Loan Document or which is contained in any
certificate, document or financial or other statement furnished by it at any
time under or in connection with this Agreement shall prove to have been
incorrect in any material respect on or as of the date made or deemed made; or

            (c) (i) The Borrower shall default in the observance or performance
of any covenant contained in subsections 8.4(b), 8.7(a) or in Section 9; or the
Borrower shall default in the observance or performance of any other agreement
contained in this Agreement (other than as provided above in this Section), and
such default described in this clause (ii) shall continue unremedied for a
period of 30 days; or

            (d) The Borrower or any of its Subsidiaries shall: (i) default in
any payment of principal of or interest of any Indebtedness (other than the
Loans) or in the payment of any Guarantee Obligation, beyond the period of
grace, if any, provided in the instrument or agreement under which such
Indebtedness or Guarantee Obligation was created; or (ii) default in the
observance or performance of any other agreement or condition relating to any
such Indebtedness or Guarantee Obligation or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event shall
occur or condition exist, the effect of which default or other event or
condition is to cause, or to permit the holder or holders of such Indebtedness
or beneficiary or beneficiaries of such Guarantee Obligation (or a trustee or
agent on behalf of such holder or holders or beneficiary or beneficiaries) to
cause, with the giving of

                                       41
<PAGE>

notice if required, such Indebtedness to become due prior to its stated maturity
or such Guarantee Obligation to become payable; provided, however, that no
Default or Event of Default shall exist under this paragraph unless the
aggregate amount of Indebtedness and/or Guarantee Obligations in respect of
which any default or other event or condition referred to in this paragraph
shall have occurred shall be equal to at least $100,000,000; or

            (e) (i) The Borrower or any of its Subsidiaries shall commence any
case, proceeding or other action (A) under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief entered
with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or
seeking reorganization, arrangement, adjustment, winding-up, liquidation,
dissolution, composition or other relief with respect to it or its debts, or (B)
seeking appointment of a receiver, trustee, custodian, conservator or other
similar official for it or for all or any substantial part of its assets, or the
Borrower or any of its Subsidiaries shall make a general assignment for the
benefit of its creditors; or (ii) there shall be commenced against the Borrower
or any of its Subsidiaries any case, proceeding or other action of a nature
referred to in clause (i) above which (A) results in the entry of an order for
relief or any such adjudication or appointment or (B) remains undismissed,
undischarged or unbonded for a period of 60 days; or (iii) there shall be
commenced against the Borrower or any of its Subsidiaries any case, proceeding
or other action seeking issuance of a warrant of attachment, execution,
distraint or similar process against all or any substantial part of its assets
which results in the entry of an order for any such relief which shall not have
been vacated, discharged, or stayed or bonded pending appeal within 60 days from
the entry thereof; or (iv) the Borrower or any of its Subsidiaries shall take
any action in furtherance of, or indicating its consent to, approval of, or
acquiescence in, any of the acts set forth in clause (i), (ii), or (iii) above;
or (v) the Borrower or any of its Subsidiaries shall generally not or shall
admit in writing its inability to, pay its debts as they become due; or

            (f) (i) Any Person shall engage in any "prohibited transaction" (as
defined in Section 406 of ERISA or Section 4975 of the Code) involving any Plan,
(ii) any "accumulated funding deficiency" (as defined in Section 302 of ERISA),
whether or not waived, shall exist with respect to any Plan or any Lien in favor
of the PBGC or a Plan shall arise on the assets of the Borrower or any Commonly
Controlled Entity, (iii) a Reportable Event shall occur with respect to, or
proceedings shall commence to have a trustee appointed, or a trustee shall be
appointed, to administer or to terminate, any Single Employer Plan, which
Reportable Event or commencement of proceedings or appointment of a trustee is
likely to result in the termination of such Plan for purposes of Title IV of
ERISA, (iv) any Single Employer Plan shall terminate for purposes of Title IV of
ERISA, (v) the Borrower or any Commonly Controlled Entity shall incur any
liability in connection with a withdrawal from, or the Insolvency or
Reorganization of, a Multiemployer Plan or (vi) any other event or condition
shall occur or exist with respect to a Plan; and in each case in clauses (i)
through (vi) above, such event or condition, together with all other such events
or conditions, if any, could reasonably be expected to have a Material Adverse
Effect; or

            (g) One or more judgments or decrees shall be entered against the
Borrower or any of its Subsidiaries involving in the aggregate a liability (not
paid or in excess of the amount recoverable by insurance) of $100,000,000 (net
of any related tax benefit) or more, and all such

                                       42
<PAGE>

judgments or decrees shall not have been vacated, discharged, stayed or bonded
pending appeal within 60 days from the entry thereof; or

            (h) (i) Any Person or "group" (within the meaning of Section 13(d)
or 14(d) of the Securities Exchange Act of 1934, as amended) (A) shall have
acquired beneficial ownership of 30% or more of any outstanding class of Capital
Stock having ordinary voting power in the election of directors of the Borrower
(other than Peter M. Nicholas and John E. Abele or any of their affiliated trust
holdings) or (B) shall obtain the power (whether or not exercised) to elect a
majority of the Borrower's directors; or (ii) the Board of Directors of the
Borrower shall not consist of a majority of Continuing Directors; "Continuing
Directors" shall mean the directors of the Borrower on the Closing Date and each
other director, if such other director's nomination for election to the Board of
Directors of the Borrower is recommended by a majority of the then Continuing
Directors;

then, and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (e) above with respect to the Borrower,
automatically the Commitments shall immediately terminate and the Loans
hereunder (with accrued interest thereon) and all other amounts owing under this
Agreement and the other Loan Documents shall immediately become due and payable,
and (B) if such event is any other Event of Default, either or both of the
following actions may be taken: (i) with the consent of the Majority Lenders,
the Administrative Agent may, or upon the request of the Majority Lenders, the
Administrative Agent shall, by notice to the Borrower declare the Commitments to
be terminated forthwith, whereupon the Commitments shall immediately terminate;
and (ii) with the consent of the Majority Lenders, the Administrative Agent may,
or upon the request of the Majority Lenders, the Administrative Agent shall, by
notice to the Borrower, declare the Loans hereunder (with accrued interest
thereon) and all other amounts owing under this Agreement and the other Loan
Documents to be due and payable forthwith, whereupon the same shall immediately
become due and payable.


                                   SECTION 11
                                   THE AGENTS

            11.1 APPOINTMENT. Each Lender hereby irrevocably designates and
appoints the Administrative Agent as the agent of such Lender under this
Agreement and the other Loan Documents, and each Lender irrevocably authorizes
the Administrative Agent, in such capacity, to take such action on its behalf
under the provisions of this Agreement and the other Loan Documents and to
exercise such powers and perform such duties as are expressly delegated to the
Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Administrative Agent shall not have any duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with any Lender, and
no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Administrative Agent.

            11.2 DELEGATION OF DUTIES. The Administrative Agent may execute any
of its duties under this Agreement and the other Loan Documents by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The

                                       43
<PAGE>

Administrative Agent shall not be responsible for the negligence or misconduct
of any agents or attorneys in-fact selected by it with reasonable care.

            11.3 EXCULPATORY PROVISIONS. Neither any Agent nor any of its
officers, directors, employees, agents, attorneys-in-fact or Affiliates shall be
(i) liable for any action lawfully taken or omitted to be taken by it or such
Person under or in connection with this Agreement or any other Loan Document
(except for its or such Person's own gross negligence or willful misconduct) or
(ii) responsible in any manner to any of the Lenders for any recitals,
statements, representations or warranties made by the Borrower or any officer
thereof contained in this Agreement or any other Loan Document or in any
certificate, report, statement or other document referred to or provided for in,
or received by such Agent under or in connection with, this Agreement or any
other Loan Document or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Loan Document or
for any failure of the Borrower to perform its obligations hereunder or
thereunder. No Agent shall be under any obligation to any Lender to ascertain or
to inquire as to the observance or performance of any of the agreements
contained in, or conditions of, this Agreement or any other Loan Document, or to
inspect the properties, books or records of the Borrower.

            11.4 RELIANCE BY ADMINISTRATIVE AGENT. The Administrative Agent
shall be entitled to rely, and shall be fully protected in relying, upon any
Note, writing, resolution, notice, consent, certificate, affidavit, letter,
telecopy, telex or teletype message, statement, order or other document or
conversation believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person or Persons and upon advice and statements of
legal counsel (including, without limitation, counsel to the Borrower),
independent accountants and other experts selected by the Administrative Agent.
The Administrative Agent may deem and treat the payee of any Note as the owner
thereof for all purposes unless a written notice of assignment, negotiation or
transfer thereof shall have been filed with the Administrative Agent. The
Administrative Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the Majority Lenders as it deems
appropriate or it shall first be indemnified to its satisfaction by the Lenders
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. The Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting, under
this Agreement and the other Loan Documents in accordance with a request of the
Majority Lenders, and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders and all future holders of
the Loans.

            11.5 NOTICE OF DEFAULT. The Administrative Agent shall not be deemed
to have knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Administrative Agent has received notice from a Lender or
the Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default". In the event that
the Administrative Agent receives such a notice, the Administrative Agent shall
give notice thereof to the Lenders. The Administrative Agent shall take such
action with respect to such Default or Event of Default as shall be reasonably
directed by the Majority Lenders; provided that unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or

                                       44
<PAGE>

refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interests of the Lenders.

            11.6 NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS. Each
Lender expressly acknowledges that neither the Administrative Agent nor any of
its officers, directors, employees, agents, attorneys-in-fact or Affiliates has
made any representations or warranties to it and that no act by the
Administrative Agent hereinafter taken, including any review of the affairs of
the Borrower, shall be deemed to constitute any representation or warranty by
the Administrative Agent to any Lender. Each Lender represents to the
Administrative Agent that 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 appraisal of and
investigation into the business, operations, property, financial and other
condition and creditworthiness of the Borrower and made its own decision to make
its Loans hereunder and enter into this Agreement. Each Lender also represents
that it will, independently and without reliance upon the Administrative Agent
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 analysis,
appraisals and decisions in taking or not taking action under this Agreement and
the other Loan Documents, and to make such investigation as it deems necessary
to inform itself as to the business, operations, property, financial and other
condition and creditworthiness of the Borrower. Except for notices, reports and
other documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall not have any duty
or responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness of the Borrower which may come into
the possession of the Administrative Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or Affiliates.

            11.7 INDEMNIFICATION. The Lenders agree to indemnify the
Administrative Agent (or sub-agent), in its capacity, and any Related Party
acting for the Administrative Agent (or any sub-agent) in connection with such
capacity (to the extent not reimbursed by the Borrower and without limiting the
obligation of the Borrower to do so), ratably according to their respective
Commitment Percentages in effect on the date on which indemnification is sought
(or, if indemnification is sought after the date upon which the Commitments
shall have terminated and the Loans shall have been paid in full, ratably in
accordance with such percentages immediately prior to such date), from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind
whatsoever which may at any time (including, without limitation, at any time
following the payment of the Loans) be imposed on, incurred by or asserted
against the Administrative Agent (or any sub-agent) or such Related Party in any
way relating to or arising out of, the Commitments, this Agreement, any of the
other Loan Documents or any documents contemplated by or referred to herein or
therein or the transactions contemplated hereby or thereby or any action taken
or omitted by the Administrative Agent (or any sub-agent) or such Related Party
under or in connection with any of the foregoing; provided that no Lender shall
be liable for the payment of any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements which are found by a final and nonappealable decision of a court
of competent jurisdiction to have resulted from the gross negligence or willful
misconduct of the Administrative Agent (or sub-agent) or any Related Party
acting for the Administrative

                                       45
<PAGE>

Agent (or any sub-agent) in connection with such capacity. The agreements in
this subsection shall survive the payment of the Loans and all other amounts
payable hereunder.

            11.8 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY. The
Administrative Agent and its Affiliates may make loans to, accept deposits from
and generally engage in any kind of business with the Borrower as though the
Administrative Agent were not the Administrative Agent hereunder and under the
other Loan Documents. With respect to the Loans made by it, the Administrative
Agent shall have the same rights and powers under this Agreement and the other
Loan Documents as any Lender and may exercise the same as though it were not the
Administrative Agent, and the terms "Lender" and "Lenders" shall include the
Administrative Agent in its individual capacity.

            11.9 SUCCESSOR ADMINISTRATIVE AGENT. The Administrative Agent may
resign as Administrative Agent upon 10 days' notice to the Lenders. If the
Administrative Agent shall resign as Administrative Agent under this Agreement
and the other Loan Documents, then the Majority Lenders shall appoint from among
the Lenders a successor agent for the Lenders, which successor agent (provided
that it shall have been approved by the Borrower), shall succeed to the rights,
powers and duties of the Administrative Agent hereunder. Effective upon such
appointment and approval, the term "Administrative Agent" shall mean such
successor agent, and the former Administrative Agent's rights, powers and duties
as Administrative Agent shall be terminated, without any other or further act or
deed on the part of such former Administrative Agent or any of the parties to
this Agreement or any holders of the Loans. After any retiring Administrative
Agent's resignation as Administrative Agent, the provisions of this Section 11
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Administrative Agent under this Agreement and the other Loan
Documents.

            11.10 THE ARRANGERS, THE BOOKRUNNERS, THE SYNDICATION AGENTS AND THE
DOCUMENTATION AGENTS. None of the Arrangers, the Bookrunners, the Syndication
Agents or the Documentation Agents shall have any right, power, obligation,
liability, responsibility or duty under this Agreement other than those
applicable to all Lenders as such. Without limiting the foregoing, none of the
Arrangers, the Bookrunners, the Syndication Agents or the Documentation Agents
shall have or be deemed to have any fiduciary relationship with any Lender. Each
Lender acknowledges that it has not relied, and will not rely, on the Arrangers,
the Bookrunners, the Syndication Agents or the Documentation Agents in deciding
to enter into this Agreement or in taking or not taking any action hereunder.


                                   SECTION 12
                            [INTENTIONALLY OMITTED].


                                   SECTION 13
                                  MISCELLANEOUS

            13.1 AMENDMENTS AND WAIVERS. Neither this Agreement nor any other
Loan Document, nor any terms hereof or thereof may be amended, supplemented or
modified except in accordance with the provisions of this subsection. The
Majority Lenders may, or, with the written consent of the Majority Lenders, the
Administrative Agent may, from time to time, (a) enter into with the Borrower
written amendments, supplements or modifications hereto and to

                                       46
<PAGE>

the other Loan Documents for the purpose of adding any provisions to this
Agreement or the other Loan Documents or changing in any manner the rights of
the Lenders or of the Borrower hereunder or thereunder or (b) waive, on such
terms and conditions as the Majority Lenders or the Administrative Agent, as the
case may be, may specify in such instrument, any of the requirements of this
Agreement or the other Loan Documents or any Default or Event of Default and its
consequences; provided, however, that no such waiver and no such amendment,
supplement or modification shall (i) reduce the amount or extend the scheduled
date of maturity of any Loan, or reduce the stated rate or amount of any
interest or fee payable hereunder or extend the scheduled date of any payment
thereof or increase the amount or extend the expiration date of any Lender's
Commitment or modify the pro rata distribution of payments, proceeds or fees
payable to the Lenders, in each case without the consent of each Lender affected
thereby, or (ii) amend, modify or waive any provision of this subsection or
reduce the percentages specified in the definition of Majority Lenders, or
consent to the assignment or transfer by the Borrower of any of its rights and
obligations under this Agreement and the other Loan Documents, in each case
without the written consent of all the Lenders, or (iii) amend, modify or waive
any provision of Section 11 without the written consent of the then
Administrative Agent. Any such waiver and any such amendment, supplement or
modification shall apply equally to each of the Lenders and shall be binding
upon the Borrower, the Lenders, the Administrative Agent and all future holders
of the Loans. In the case of any waiver, the Borrower, the Lenders and the
Administrative Agent shall be restored to their former positions and rights
hereunder and under the other Loan Documents, and any Default or Event of
Default waived shall be deemed to be cured and not continuing; no such waiver
shall extend to any subsequent or other Default or Event of Default or impair
any right consequent thereon.

13.2 NOTICES. All notices, requests and demands to or upon the respective
parties hereto to be effective shall be in writing (including by facsimile
transmission) and, unless otherwise expressly provided herein, shall be deemed
to have been duly given or made (a) in the case of delivery by hand, when
delivered, (b) in the case of delivery by mail, three days after being deposited
in the mails, postage prepaid, or (c) in the case of delivery by facsimile
transmission, when sent and receipt has been confirmed, addressed as follows in
the case of the Borrower and the Administrative Agent, and as set forth in
Schedule I in the case of the other parties hereto, or to such other address as
may be hereafter notified by the respective parties hereto:

            The Borrower:

                        Boston Scientific Corporation
                        One Boston Scientific Place
                        Natick, Massachusetts 01760
                        Attention: Lawrence C. Best
                        Senior Vice President, Finance & Administration
                        and Chief Financial Officer
                        Fax: 508-650-8951

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<PAGE>

            with a copy to:

                        Paul Sandman
                        Senior Vice President, General Counsel
                        Fax: 508-650-8960

            The Administrative Agent:

                        JPMorgan Chase Bank
                        Loan & Agency Services Group
                        1111 Fannin, Floor 10
                        Houston, Texas 77002
                        Attention: Vikki Toler/Jennifer Anyigbo
                        Fax: (713) 750-2949/2782

            with a copy to:

                        JPMorgan Chase Bank
                        270 Park Avenue
                        New York, New York 10017
                        Attention: Dawn Lee Lum
                        Fax: 212-270-5100

provided that any notice, request or demand to or upon the Administrative Agent
or the Lenders pursuant to subsection 2.2, 2.6, 2.9 or 3.2 shall not be
effective until received.

            13.3 NO WAIVER; CUMULATIVE REMEDIES. No failure to exercise and no
delay in exercising, on the part of the Administrative Agent or any Lender, any
right, remedy, power or privilege hereunder or under the other Loan Documents
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges herein provided are cumulative and
not exclusive of any rights, remedies, powers and privileges provided by law.

            13.4 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties made hereunder, in the other Loan Documents and in any document,
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Agreement and the making of the
Loans hereunder.

            13.5 PAYMENT OF EXPENSES AND TAXES. The Borrower agrees (a) to pay
or reimburse the Administrative Agent for all its reasonable out-of-pocket costs
and expenses incurred in connection with the development, preparation and
execution of, and any amendment, supplement or modification to, this Agreement
and the other Loan Documents and any other documents prepared in connection
herewith or therewith, and the consummation and administration of the
transactions contemplated hereby and thereby, including, without limitation, the
reasonable fees and disbursements of counsel to the Administrative Agent, (b) to
pay or reimburse each Lender and the Administrative Agent for all its costs and
expenses incurred in connection with the

                                       48
<PAGE>

enforcement or preservation of any rights under this Agreement, the other Loan
Documents and any such other documents, including, without limitation, the fees
and disbursements of counsel (including the allocated fees and expenses of
in-house counsel) to each Lender and of counsel to the Administrative Agent,
provided, that in connection with any workout or restructuring, the Borrower
shall pay the fees and disbursements of one counsel for the Administrative Agent
and the Lenders pursuant to this clause (b), (c) to pay, indemnify, and hold
each Lender and the Administrative Agent and each of their affiliates and their
respective officer, directors, employees, agents and advisors (each, an
"indemnified party") harmless from, any and all recording and filing fees and
any and all liabilities with respect to, or resulting from any delay in paying,
stamp, excise and other taxes, if any, which may be payable or determined to be
payable in connection with the execution and delivery of, or consummation or
administration of any of the transactions contemplated by, or any amendment,
supplement or modification of, or any waiver or consent under or in respect of,
this Agreement, the other Loan Documents and any such other documents, and (d)
to pay, indemnify, and hold each indemnified party harmless from and against any
and all other liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever with respect to the execution, delivery, enforcement, performance and
administration of this Agreement, the other Loan Documents and such other
documents including, without limitation, any of the foregoing relating to the
violation of, noncompliance with or liability under, any Environmental Law
applicable to the operations of the Borrower, any of its Subsidiaries or any of
the Properties (all the foregoing in this clause (d), collectively, the
"indemnified liabilities"), provided that the Borrower shall have no obligation
hereunder to any indemnified party with respect to indemnified liabilities
arising from the gross negligence or willful misconduct of such indemnified
party determined in a court of competent jurisdiction in a final non-appealable
judgment. The agreements in this subsection shall survive repayment of the Loans
and all other amounts payable hereunder.

            13.6 SUCCESSORS AND ASSIGNS; PARTICIPATIONS AND ASSIGNMENTS. (a)
This Agreement shall be binding upon and inure to the benefit of the Borrower,
the Lenders, the Administrative Agent and their respective successors and
assigns, except that no Borrower may assign or transfer any of its rights or
obligations under this Agreement without the prior written consent of each
Lender.

            (b) Any Lender, other than a Conduit Lender, may, in the ordinary
course of its commercial banking business and in accordance with applicable law,
at any time sell to one or more banks or other entities ("Participants")
participating interests in any Loan owing to such Lender, any Commitment of such
Lender or any other interest of such Lender hereunder and under the other Loan
Documents. In the event of any such sale by a Lender of a participating interest
to a Participant, such Lender's obligations under this Agreement to the other
parties to this Agreement shall remain unchanged, such Lender shall remain
solely responsible for the performance thereof, such Lender shall remain the
holder of any such Loan for all purposes under this Agreement and the other Loan
Documents, and the Borrower and the Administrative Agent shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement and the other Loan Documents. No Lender shall
be entitled to create in favor of any Participant, in the participation
agreement pursuant to which such Participant's participating interest shall be
created or otherwise, any right to vote on, consent to or approve any matter
relating to this Agreement or any other Loan Document except

                                       49
<PAGE>

for those specified in clauses (i) and (ii) of the proviso to subsection
13.1(a). The Borrower agrees that if amounts outstanding under this Agreement
are due or unpaid, or shall have been declared or shall have become due and
payable upon the occurrence of an Event of Default, each Participant shall, to
the maximum extent permitted by applicable law, be deemed to have the right of
setoff in respect of its participating interest in amounts owing under this
Agreement to the same extent as if the amount of its participating interest were
owing directly to it as a Lender under this Agreement, provided that, in
purchasing such participating interest, such Participant shall be deemed to have
agreed to share with the Lenders the proceeds thereof as provided in subsection
13.7(a) as fully as if it were a Lender hereunder. The Borrower also agrees that
each Participant shall be entitled to the benefits of subsections 3.9, 3.10 and
3.11 with respect to its participation in the Commitments and the Loans
outstanding from time to time as if it was a Lender; provided that, in the case
of subsection 3.10, such Participant shall have complied with the requirements
of said subsection and provided, further, that no Participant shall be entitled
to receive any greater amount pursuant to any such subsection than the
transferor Lender would have been entitled to receive in respect of the amount
of the participation transferred by such transferor Lender to such Participant
had no such transfer occurred.

            (c) Any Lender, other than a Conduit Lender, may, in the ordinary
course of its commercial banking business and in accordance with applicable law,
at any time and from time to time, assign to any Lender or any Lender Affiliate
with the consent (in each case, not to be unreasonably withheld) of the
Administrative Agent and, except for assignments to any Lender or Lender
Affiliate of comparable credit worthiness, the Borrower, or with the consent of
the Borrower (unless a Default or an Event of Default shall have occurred and be
continuing), the Administrative Agent (which in each case shall not be
unreasonably withheld), to an additional bank, financial institution, or other
entity (an "Assignee") all or any part of its rights and obligations under this
Agreement and the other Loan Documents pursuant to an Assignment and Acceptance,
substantially in the form of Exhibit H, executed by such Assignee, such
assigning Lender (and, in the case of an Assignee that is not then a Lender or a
Lender Affiliate of comparable credit worthiness, by the Borrower, the
Administrative Agent, and in the case of an Assignee that is a Lender or a
Lender Affiliate, by the Administrative Agent) and delivered to the
Administrative Agent for its acceptance and recording in the Register, provided
that, in the case of any such assignment to an additional bank, financial
institution or other entity, the sum of the aggregate principal amount of the
Loans and the aggregate amount of the unused Commitment being assigned shall be
not less than $5,000,000 and, if such assignment is of less than all of the
rights and obligations of the assigning Lender, the sum of the aggregate
principal amount of the Revolving Credit Loans and the aggregate amount of the
unused Commitment remaining with the assigning Lender shall be not less than
$10,000,000 (or such lesser amount as may be agreed to by the Borrower and the
Administrative Agent). Upon such execution, delivery, acceptance and recording,
from and after the effective date determined pursuant to such Assignment and
Acceptance, (x) the Assignee thereunder shall be a party hereto and, to the
extent provided in such Assignment and Acceptance, have the rights and
obligations of a Lender hereunder with Commitments as set forth therein, and (y)
the assigning Lender thereunder shall, to the extent provided in such Assignment
and Acceptance, be released from its obligations under this Agreement (and, in
the case of an Assignment and Acceptance covering all or the remaining portion
of an assigning Lender's rights and obligations under this Agreement, such
assigning Lender shall cease to be a party hereto). Notwithstanding the
foregoing, any Conduit Lender may assign at any time to its designating Lender
hereunder without the consent of the

                                       50
<PAGE>

Borrower or the Administrative Agent any or all of the Loans it may have funded
hereunder and pursuant to its designation agreement and without regard to the
limitations set forth in the first sentence of this subsection 13.6(c).

            (d) The Administrative Agent, on behalf of the Borrower, shall
maintain at the address of the Administrative Agent referred to in subsection
13.2, a copy of each Assignment and Acceptance delivered to it and a register
(the "Register") for the recordation of the names and addresses of the Lenders
and the Commitments of, and principal amount of the Loans owing to, each Lender
from time to time. The entries in the Register shall be conclusive, in the
absence of manifest error, and the Borrower, the Administrative Agent and the
Lenders may (and, in the case of any Loan or other obligation hereunder not
evidenced by a Note, shall) treat each Person whose name is recorded in the
Register as the owner of a Loan or other obligation hereunder as the owner
thereof for all purposes of this Agreement and the other Loan Documents,
notwithstanding any notice to the contrary. Any assignment of any Loan or other
obligation hereunder not evidenced by a Note shall be effective only upon
appropriate entries with respect thereto being made in the Register. The
Register shall be available for inspection by the Borrower or any Lender at any
reasonable time and from time to time upon reasonable prior notice.

            (e) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender and an Assignee (and, in the case of an Assignee that is not
then a Lender or a Lender Affiliate, by the Borrower (if required) and the
Administrative Agent) together with payment to the Administrative Agent of a
registration and processing fee of $4,000, the Administrative Agent shall (i)
promptly accept such Assignment and Acceptance and (ii) on the effective date
determined pursuant thereto record the information contained therein in the
Register and give notice of such acceptance and recordation to the Lenders and
the Borrower.

            (f) The Borrower authorizes each Lender to disclose to any
Participant or Assignee (each, a "Transferee") and any prospective Transferee,
subject to the provisions of subsection 13.14, any and all financial information
in such Lender's possession concerning the Borrower and its Affiliates which has
been delivered to such Lender by or on behalf of the Borrower pursuant to this
Agreement or which has been delivered to such Lender by or on behalf of the
Borrower in connection with such Lender's credit evaluation of such Borrower and
its Affiliates prior to becoming a party to this Agreement.

            (g) For avoidance of doubt, the parties to this Agreement
acknowledge that the provisions of this subsection concerning assignments of
Loans and Notes relate only to absolute assignments and that such provisions do
not prohibit assignments creating security interests, including, without
limitation, any pledge or assignment by a Lender of any Loan or Note to any
Federal Reserve Bank in accordance with applicable law.

            13.7 ADJUSTMENTS; SET-OFF. (a) If any Lender (a "benefited Lender")
shall at any time receive any payment of all or part of its Loans then due and
owing, or interest thereon, or receive any collateral in respect thereof
(whether voluntarily or involuntarily, by set-off, pursuant to events or
proceedings of the nature referred to in subsection 10(e), or otherwise), in a
greater proportion than any such payment to or collateral received by any other
Lender (other than to the extent expressly provided herein), if any, in respect
of such other Lender's Loans then due and

                                       51
<PAGE>

owing, or interest thereon, such benefited Lender shall purchase for cash from
the other Lenders a participating interest in such portion of each such other
Lender's Loan, or shall provide such other Lenders with the benefits of any such
collateral, or the proceeds thereof, as shall be necessary to cause such
benefited Lender to share the excess payment or benefits of such collateral or
proceeds ratably with each of the Lenders; provided, however, that if all or any
portion of such excess payment or benefits is thereafter recovered from such
benefited Lender, such purchase shall be rescinded, and the purchase price and
benefits returned, to the extent of such recovery, but without interest.

            (b) In addition to any rights and remedies of the Lenders provided
by law, each Lender shall have the right, without prior notice to the Borrower,
any such notice being expressly waived by the Borrower to the extent permitted
by applicable law, upon any amount becoming due and payable by the Borrower
hereunder (whether at the stated maturity, by acceleration or otherwise) to
set-off and appropriate and apply against such amount any and all deposits
(general or special, time or demand, provisional or final), in any currency, and
any other credits, indebtedness or claims, in any currency, in each case whether
direct or indirect, absolute or contingent, matured or unmatured, at any time
held or owing by such Lender or any Affiliate, branch or agency thereof to or
for the credit or the account of the Borrower. Each Lender agrees promptly to
notify the Borrower and the Administrative Agent after any such set-off and
application made by such Lender, provided that the failure to give such notice
shall not affect the validity of such set-off and application.

            13.8 COUNTERPARTS. This Agreement may be executed by one or more of
the parties to this Agreement on any number of separate counterparts (including
by facsimile transmission), and all of said counterparts taken together shall be
deemed to constitute one and the same instrument. A set of the copies of this
Agreement signed by all the parties shall be lodged with the Borrower and the
Administrative Agent.

            13.9 SEVERABILITY. Any provision of this Agreement which 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 not invalidate or render
unenforceable such provision in any other jurisdiction.

            13.10 INTEGRATION. This Agreement and the other Loan Documents
represent the agreement of the Borrower, the Administrative Agent and the
Lenders with respect to the subject matter hereof, and there are no promises,
undertakings, representations or warranties by the Administrative Agent or any
Lender relative to subject matter hereof not expressly set forth or referred to
herein or in the other Loan Documents.

            13.11 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

            13.12 SUBMISSION TO JURISDICTION; WAIVERS. The Borrower hereby
irrevocably and unconditionally:

                                       52
<PAGE>

            (a) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Loan Documents to which it
is a party, or for recognition and enforcement of any judgment in respect
thereof, to the non-exclusive general jurisdiction of the Courts of the State of
New York, the courts of the United States of America for the Southern District
of New York, and appellate courts from any thereof;

            (b) consents that any such action or proceeding may be brought in
such courts and waives any objection that it may now or hereafter have to the
venue of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;

            (c) agrees that service of process in any such action or proceeding
may be effected by mailing a copy thereof by registered or certified mail (or
any substantially similar form of mail), postage prepaid, to the Borrower at its
address set forth in subsection 13.2 or at such other address of which the
Administrative Agent shall have been notified pursuant thereto;

            (d) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the right
to sue in any other jurisdiction; and

            (e) waives, to the maximum extent not prohibited by law, any right
it may have to claim or recover in any legal action or proceeding referred to in
this subsection any special, exemplary, punitive or consequential damages.

            13.13 ACKNOWLEDGEMENTS. The Borrower hereby acknowledges that:

            (a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents;

            (b) neither the Administrative Agent nor any Lender has any
fiduciary relationship with or duty to the Borrower arising out of or in
connection with this Agreement or any of the other Loan Documents, and the
relationship between the Administrative Agent and Lenders, on the one hand, and
the Borrower, on the other hand, in connection herewith or therewith is solely
that of debtor and creditor; and

            (c) no joint venture is created hereby or by the other Loan
Documents or otherwise exists by virtue of the transactions contemplated hereby
among the Lenders or among the Borrower and the Lenders.

            13.14 CONFIDENTIALITY. Each Lender agrees to keep confidential any
written or oral information (a) provided to it by or on behalf of the Borrower
or any of its Subsidiaries pursuant to or in connection with this Agreement or
(b) obtained by such Lender based on a review of the books and records of the
Borrower or any of its Subsidiaries; provided that nothing herein shall prevent
any Lender from disclosing any such information (i) to the Administrative Agent
or any Lender, (ii) to any Transferee or prospective Transferee which receives
such information having been made aware of the confidential nature thereof and
having agreed to abide by the provisions of this subsection 13.14, (iii) to its
employees, directors, agents, attorneys, accountants and other professional
advisors, and to employees and officers of its Affiliates who agree to be bound
by the provisions of this subsection 13.14 and who have a need for such
information in connection

                                       53
<PAGE>

with this Agreement or other transactions or proposed transactions with the
Borrower, (iv) upon the request or demand of any Governmental Authority having
jurisdiction over such Lender, (v) in response to any order of any court or
other Governmental Authority or as may otherwise be required pursuant to any
Requirement of Law, (vi) subject to an agreement to comply with the provisions
of this subsection, to any actual or prospective counter-party (or its advisors)
to any Hedge Agreement, (vii) which has been publicly disclosed other than in
breach of this Agreement, or (viii) in connection with the exercise of any
remedy hereunder.

            13.15 [INTENTIONALLY OMITTED].

            13.16 [INTENTIONALLY OMITTED].

            13.17 WAIVERS OF JURY TRIAL. THE BORROWER, THE ADMINISTRATIVE AGENT
AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN
ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.

            13.18 USA PATRIOT ACT NOTICE. Each Lender 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 "Patriot 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 Patriot Act.



                                       54
<PAGE>

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



                                    BOSTON SCIENTIFIC CORPORATION

                                    By: _________________________________
                                    Name:
                                    Title:


                                    JPMORGAN CHASE BANK,
                                    as Administrative Agent and as a Lender

                                    By: _________________________________
                                    Name:
                                    Title:


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

                                    By: _________________________________
                                    Name:
                                    Title:


                                    WACHOVIA BANK, NATIONAL ASSOCIATION,
                                    as Syndication Agent and as a Lender

                                    By: _________________________________
                                    Name:
                                    Title:



<PAGE>


                                    ABN AMRO BANK N.V.,
                                    as Documentation Agent and as a Lender

                                    By: _________________________________
                                    Name:
                                    Title:

                                    By: _________________________________
                                    Name:
                                    Title:


                                    CITICORP USA, INC.,
                                    as Documentation Agent and as a Lender

                                    By: _________________________________
                                    Name:
                                    Title:


                                    DEUTSCHE BANK AG NEW YORK BRANCH,
                                    as Documentation Agent and as a Lender

                                    By: _________________________________
                                    Name:
                                    Title:

                                    By: _________________________________
                                    Name:
                                    Title:


                                    SUMITOMO MITSUI BANKING CORPORATION,
                                    as Documentation Agent and as a Lender

                                    By: _________________________________
                                    Name:
                                    Title:


<PAGE>

                                    THE BANK OF TOKYO-MITSUBISHI, LTD., NEW YORK
                                    BRANCH, as Documentation Agent and as a
                                    Lender

                                    By: _________________________________
                                    Name:
                                    Title:


                                    MERRILL LYNCH BANK USA,
                                    as a Lender

                                    By: _________________________________
                                    Name:
                                    Title:


                                    BNP PARIBAS,
                                    as a Lender

                                    By: _________________________________
                                    Name:
                                    Title:


                                    By: _________________________________
                                    Name:
                                    Title:


                                    ALLIED IRISH BANKS PLC,
                                    as a Lender

                                    By: _________________________________
                                    Name:
                                    Title:


                                    CITIZENS BANK OF MASSACHUSETTS,
                                    as a Lender

                                    By: _________________________________
                                    Name:
                                    Title:

<PAGE>

                                    STANDARD CHARTERED BANK,
                                    as a Lender

                                    By: _________________________________
                                    Name:
                                    Title:


                                    BANCO BILBAO VIZCAYA ARGENTARIA S.A., NEW
                                    YORK BRANCH, as a Lender

                                    By: _________________________________
                                    Name:
                                    Title:


                                    KEYBANK NATIONAL ASSOCIATION,
                                    as a Lender

                                    By: _________________________________
                                    Name:
                                    Title:


                                    MIZUHO CORPORATE BANK, LTD.,
                                    as a Lender

                                    By: _________________________________
                                    Name:
                                    Title:


                                    MELLON BANK, N.A.,
                                    as a Lender

                                    By: _________________________________
                                    Name:
                                    Title:


                                    BANCA INTESA, NEW YORK BRANCH,
                                    as a Lender

                                    By: _________________________________
                                    Name:
                                    Title:

<PAGE>

                                    THE BANK OF NEW YORK,
                                    as a Lender

                                    By: _________________________________
                                    Name:
                                    Title:


                                    U.S. BANK, NATIONAL ASSOCIATION,
                                    as a Lender

                                    By: _________________________________
                                    Name:
                                    Title:


                                    SVENSKA HANDELSBANKEN AB,
                                    as a Lender

                                    By: _________________________________
                                    Name:
                                    Title:


                                    By: _________________________________
                                    Name:
                                    Title:




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.1
<SEQUENCE>5
<FILENAME>exhibit31-1_12848.txt
<DESCRIPTION>302 CERTIFICATION OF PRESIDENT
<TEXT>
                                                                    Exhibit 31.1
                                                                    ------------
                                 CERTIFICATIONS
I, James R. Tobin, certify that:

     1.   I have reviewed this quarterly report on Form 10-Q of Boston
          Scientific Corporation;

     2.   Based on my knowledge, this report does not contain any untrue
          statement of a material fact or omit to state a material fact
          necessary to make the statements made, in light of the circumstances
          under which such statements were made, not misleading with respect to
          the period covered by this report;

     3.   Based on my knowledge, the financial statements, and other financial
          information included in this report, fairly present in all material
          respects the financial condition, results of operations and cash flows
          of the registrant as of, and for, the periods presented in this
          report;

     4.   The registrant's other certifying officer and I are responsible for
          establishing and maintaining disclosure controls and procedures (as
          defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
          control over financial reporting (as defined in Exchange Act Rules
          13a-15(f) and 15d-15(f)) for the registrant and have:

          a)   Designed such disclosure controls and procedures, or caused such
               disclosure controls and procedures to be designed under our
               supervision, to ensure that material information relating to the
               registrant, including its consolidated subsidiaries, is made
               known to us by others within those entities, particularly during
               the period in which this report is being prepared;

          b)   (paragraph omitted pursuant to SEC Release Nos. 33-8238,
               34-47986, 33-8392 and 34-49313);

          c)   Evaluated the effectiveness of the registrant's disclosure
               controls and procedures and presented in this report our
               conclusions about the effectiveness of the disclosure controls
               and procedures, as of the end of the period covered by this
               report based on such evaluation;

          d)   Disclosed in this report any change in the registrant's internal
               control over financial reporting that occurred during the
               registrant's most recent fiscal quarter (the registrant's fourth
               fiscal quarter in the case of an annual report) that has
               materially affected, or is reasonably likely to materially
               affect, the registrant's internal control over financial
               reporting; and

     5.   The registrant's other certifying officer and I have disclosed, based
          on our most recent evaluation of internal control over financial
          reporting, to the registrant's auditors and the audit committee of
          registrant's board of directors (or persons performing the equivalent
          functions):

          a)   All significant deficiencies and material weaknesses in the
               design or operation of internal control over financial reporting
               which are reasonably likely to adversely affect the registrant's
               ability to record, process, summarize and report financial
               information; and

          b)   Any fraud, whether or not material, that involves management or
               other employees who have a significant role in the registrant's
               internal control over financial reporting.

Date: August 9, 2004
                                           /s/ James R. Tobin
                                           -------------------------------------
                                           James R. Tobin
                                           President and Chief Executive Officer

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.2
<SEQUENCE>6
<FILENAME>exhibit31-2_12848.txt
<DESCRIPTION>302 CERTIFICATION OF CHIEF FINANCIAL OFFICER
<TEXT>
                                                                    Exhibit 31.2
                                                                    ------------
                                 CERTIFICATIONS
I, Lawrence C. Best, certify that:

     1.   I have reviewed this quarterly report on Form 10-Q of Boston
          Scientific Corporation;

     2.   Based on my knowledge, this report does not contain any untrue
          statement of a material fact or omit to state a material fact
          necessary to make the statements made, in light of the circumstances
          under which such statements were made, not misleading with respect to
          the period covered by this report;

     3.   Based on my knowledge, the financial statements, and other financial
          information included in this report, fairly present in all material
          respects the financial condition, results of operations and cash flows
          of the registrant as of, and for, the periods presented in this
          report;

     4.   The registrant's other certifying officer and I are responsible for
          establishing and maintaining disclosure controls and procedures (as
          defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
          control over financial reporting (as defined in Exchange Act Rules
          13a-15(f) and 15d-15(f)) for the registrant and have:

          a)   Designed such disclosure controls and procedures, or caused such
               disclosure controls and procedures to be designed under our
               supervision, to ensure that material information relating to the
               registrant, including its consolidated subsidiaries, is made
               known to us by others within those entities, particularly during
               the period in which this report is being prepared;

          b)   (paragraph omitted pursuant to SEC Release Nos. 33-8238,
               34-47986, 33-8392 and 34-49313);

          c)   Evaluated the effectiveness of the registrant's disclosure
               controls and procedures and presented in this report our
               conclusions about the effectiveness of the disclosure controls
               and procedures, as of the end of the period covered by this
               report based on such evaluation;

          d)   Disclosed in this report any change in the registrant's internal
               control over financial reporting that occurred during the
               registrant's most recent fiscal quarter (the registrant's fourth
               fiscal quarter in the case of an annual report) that has
               materially affected, or is reasonably likely to materially
               affect, the registrant's internal control over financial
               reporting; and

     5.   The registrant's other certifying officer and I have disclosed, based
          on our most recent evaluation of internal control over financial
          reporting, to the registrant's auditors and the audit committee of
          registrant's board of directors (or persons performing the equivalent
          functions):

          a)   All significant deficiencies and material weaknesses in the
               design or operation of internal control over financial reporting
               which are reasonably likely to adversely affect the registrant's
               ability to record, process, summarize and report financial
               information; and

          b)   Any fraud, whether or not material, that involves management or
               other employees who have a significant role in the registrant's
               internal control over financial reporting.

Date: August 9, 2004

                                           /s/ Lawrence C. Best
                                           -------------------------------------
                                           Lawrence C. Best
                                           Senior Vice President - Finance &
                                           Administration and Chief Financial
                                           Officer

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32.1
<SEQUENCE>7
<FILENAME>exhibit32-1_12848.txt
<DESCRIPTION>906 CERTIFICATION OF PRESIDENT
<TEXT>
                                                                    Exhibit 32.1
                                                                    ------------


         CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO 18 U.S.C.
             SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906 OF THE
                           SARBANES-OXLEY ACT OF 2002


      In connection with the Quarterly Report on Form 10-Q of Boston Scientific
Corporation (the "Company") for the period ending June 30, 2004 as filed with
the Securities and Exchange Commission on the date hereof (the "Report"), the
undersigned Chief Executive Officer of the Company hereby certifies, pursuant to
18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, that based on his knowledge:

(1)  the Report fully complies with the requirements of Section 13 (a) or 15 (d)
     of the Securities Exchange Act of 1934; and

(2)  the information contained in the Report fairly presents, in all material
     respects, the financial condition and results of operations of Boston
     Scientific Corporation.



By:         /s/ James R. Tobin
            -------------------------------------
            James R. Tobin
            President and Chief Executive Officer




            August 9, 2004

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32.2
<SEQUENCE>8
<FILENAME>exhibit32-2_12848.txt
<DESCRIPTION>906 CERTIFICATION OF CHIEF FINANCIAL OFFICER
<TEXT>
                                                                    Exhibit 32.2
                                                                    ------------



         CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO 18 U.S.C.
             SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906 OF THE
                           SARBANES-OXLEY ACT OF 2002


      In connection with the Quarterly Report on Form 10-Q of Boston Scientific
Corporation (the "Company") for the period ending June 30, 2004 as filed with
the Securities and Exchange Commission on the date hereof (the "Report"), the
undersigned Chief Financial Officer of the Company hereby certifies, pursuant to
18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, that based on his knowledge:

(1)  the Report fully complies with the requirements of Section 13 (a) or 15 (d)
     of the Securities Exchange Act of 1934; and

(2)  the information contained in the Report fairly presents, in all material
     respects, the financial condition and results of operations of Boston
     Scientific Corporation.



By:         /s/ Lawrence C. Best
            ------------------------------------------------
            Lawrence C. Best
            Senior Vice President - Finance & Administration
            and Chief Financial Officer





            Dated: August 9, 2004

</TEXT>
</DOCUMENT>
</SUBMISSION>
