FAHNESTOCK VINER HOLDINGS INC
EXHIBIT 10.1 CREDIT AGREEMENT
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EXHIBIT 10.1
FAHNESTOCK VINER HOLDINGS INC.
FORM 8-K DATED JANUARY 17, 2003
CREDIT AGREEMENT

<p align="center"><font size="4"><b>CREDIT AGREEMENT</b></font></p>

<p align="center">dated as of</p>

<p align="center">January 2, 2003</p>

<p align="center">between</p>

<p align="center">Fahnestock Viner Holdings Inc.</p>

<p align="center">as Borrower</p>

<p align="center">and</p>

<p align="center">Canadian Imperial Bank of Commerce</p>

<p align="center">as Lender</p>

<p align="center"><b><u>CREDIT AGREEMENT</u></b></p>

<p><b>THIS CREDIT AGREEMENT</b> is dated as of January 2, 2003
and is entered into between Fahnestock Viner Holdings Inc., as
Borrower, and Canadian Imperial Bank of Commerce, as Lender.</p>

<p>The parties hereto agree as follows:</p>

<p align="center"><b>ARTICLE 1</b><font color="#0000FF"><b><br>
DEFINITIONS</b></font></p>

<p><b>1.1 </b><font color="#0000FF"><b>Defined Terms</b></font><b>.
</b>As used in this Agreement, the following terms have the
meanings specified below:</p>

<p>&quot;<u>Affiliate</u>&quot; means, with respect to any
Person, another Person that directly, or indirectly through one
or more intermediaries, controls or is controlled by or is under
common control with, such Person.</p>

<p>&quot;<u>Asset Purchase Agreement</u>&quot; means the asset
purchase agreement dated as of December 9, 2002 by and among the
Borrower, Viner International, the Lender and CIBC World Markets
Corp., as amended, supplemented or otherwise modified.</p>

<p>&quot;<u>Authorization</u>&quot; means, with respect to any
Person, any authorization, order, permit, approval, grant,
licence, consent, right, franchise, privilege, certificate,
judgment, writ, injunction, award, determination, direction,
decree, by-law, rule or regulation of any Governmental Authority
having jurisdiction over such Person, whether or not having the
force of Law.</p>

<p>&quot;<u>Borrower</u>&quot; means Fahnestock Viner Holdings
Inc., a corporation incorporated under the <i>Business
Corporations Act</i> (Ontario), and its successors and permitted
assigns.</p>

<p>&quot;<u>Borrowing</u>&quot; means any availment of the
Credit.</p>

<p>&quot;<u>Borrowing Request</u>&quot; means a request by the
Borrower for a Borrowing pursuant to Section 2.2 in the form of
Exhibit&nbsp;A.</p>

<p>&quot;<u>Business Day</u>&quot; means any day that is not a
Saturday, Sunday or other day on which commercial banks in
Toronto, Ontario or New York, New York are authorized or required
by applicable law to remain closed.</p>

<p>&quot;<u>Canadian Dollars</u>&quot; and &quot;<u>Cdn.$</u>&quot;
refer to lawful money of Canada.</p>

<p>&quot;<u>Canadian $ Equivalent</u>&quot; means, at the date of
determination, the amount of Canadian Dollars that the Lender
could purchase, in accordance with its normal practice, with a
specified amount of U.S. Dollars based on the Bank of Canada noon
spot rate on such date.</p>

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

<p>&quot;<u>Change in Law</u>&quot; means (i)&nbsp;the adoption
of any new Law after the date of this Agreement, (ii)&nbsp;any
change in any existing Law or in the interpretation or
application thereof by any Governmental Authority after the date
of this Agreement, or (iii)&nbsp;compliance by the Lender or the
Lender with any request, guideline or directive (whether or not
having the force of law, but in the case of a request, guideline
or directive not having the force of law, being a request,
guideline or directive with which persons customarily comply) of
any Governmental Authority made or issued after the date of this
Agreement.</p>

<p>&quot;<u>Closing Date</u>&quot; means January 2, 2003 or as
may otherwise be mutually agreed by the parties hereto.</p>

<p>&quot;<u>Collateral</u>&quot; means the property described in
and subject to the Liens, privileges, priorities and security
interests purported to be created by any Security Document.</p>

<p>&quot;<u>Commitment</u>&quot; is defined in Section 2.1.</p>

<p>&quot;<u>Companies</u>&quot; means, collectively, the Borrower
and each of Fahnestock Canada, Viner International, Viner Finance
and Fahnestock &amp; Co.</p>

<p>&quot;<u>Credit</u>&quot; means the credit established
pursuant to the Commitment of the Lender created hereunder.</p>

<p>&quot;<u>Default</u>&quot; means any event or condition which
constitutes an Event of Default or which, upon notice, lapse of
time or both, would, unless cured or waived, become an Event of
Default.</p>

<p>&quot;<u>Disclosed Matters</u>&quot; means the actions, suits
and proceedings disclosed in Schedule A.</p>

<p>&quot;<u>Employee Notes</u>&quot; means the notes made by
employees of Fahnestock &amp; Co. in favour of Fahnestock &amp;
Co. as contemplated by Section 2.1 and in form and substance
satisfactory to the Lender.</p>

<p>&quot;<u>Equity Securities</u>&quot; means, with respect to
any Person, any and all shares, interests, participations, rights
in, or other equivalents (however designated and whether voting
and non-voting) of, such Person&#146;s capital, whether
outstanding on the date hereof or issued after the date hereof,
including any interest in a partnership, limited partnership or
other similar Person and any beneficial interest in a trust, and
any and all rights, warrants, options or other rights
exchangeable for or convertible into any of the foregoing.</p>

<p>&quot;<u>Event of Default</u>&quot; has the meaning specified
in Section 7.1.</p>

<p>&quot;<u>Excess Net Capital</u>&quot; means, as at any date,
the amount of Net Capital of Fahnestock &amp; Co. as at such date
that is in excess of the minimum amount of Net Capital that
Fahnestock &amp; Co. is required to have at such date under the
Net Capital Rule.</p>

<p>&quot;<u>Excluded Taxes</u>&quot; means, with respect to the
Lender or any other recipient of any payment to be made by or on
account of any obligation of the Borrower hereunder, income or
franchise Taxes imposed on (or measured by) its taxable income or
capital Taxes imposed on (or measured by) its taxable capital, in
each case by Canada, or by the jurisdiction under the Laws of
which such recipient is organized or in which its principal
office is located.</p>

<p>&quot;<u>Fahnestock Canada</u>&quot; means Fahnestock Canada
Inc., a corporation incorporated under the <i>Business
Corporations Act</i> (Ontario), and its successors and permitted
assigns.</p>

<p>&quot;<u>Fahnestock &amp; Co.</u>&quot; means Fahnestock &amp;
Co. Inc., a corporation incorporated under the laws of the State
of New York.</p>

<p>&quot;<u>Financial Officer</u>&quot; means the chief financial
officer, principal accounting officer, treasurer or controller of
the Borrower.</p>

<p>&quot;<u>Financing Documents</u>&quot; means this Agreement,
the Security Documents and the Borrowing Requests, together with
any other document, instrument or agreement now or hereafter
entered into in connection with this Agreement, as such
documents, instruments or agreements may be amended, modified or
supplemented from time to time.</p>

<p>&quot;<u>Fiscal Quarter</u>&quot; means any fiscal quarter of
the Borrower.</p>

<p>&quot;<u>Fiscal Year</u>&quot; means any fiscal year of the
Borrower.</p>

<p>&quot;<u>GAAP</u>&quot; means (i) in respect to the Borrower
and Fahnestock Canada, generally accepted accounting principles
in Canada as in effect from time to time, and (ii) in respect to
any entity governed by the Laws of the United States of America,
generally accepted accounting principles in the United States of
America in effect from time to time.</p>

<p>&quot;<u>Governmental Authority</u>&quot; means the Government
of Canada, the Government of the United States of America, or any
political subdivision of either of the above, whether provincial,
state, territorial or local, and any agency, authority,
instrumentality, regulatory body, court, central bank, fiscal or
monetary authority or other authority regulating financial
institutions, and any other entity exercising executive,
legislative, judicial, taxing, regulatory or administrative
powers or functions of or pertaining to government, including the
Bank Committee on Banking Regulation and Supervisory Practices of
the Bank of International Settlements.</p>

<p>&quot;<u>Guarantee</u>&quot; of or by any Person (in this
definition, the &quot;<u>guarantor</u>&quot;) means any
obligation, contingent or otherwise, of the guarantor
guaranteeing or having the economic effect of guaranteeing any
Indebtedness or other obligation of any other Person (in this
definition, the &quot;<u>primary credit party</u>&quot;) in any
manner, whether directly or indirectly, and including any
obligation of the guarantor, direct or indirect, (a)&nbsp;to
purchase or pay (or advance or supply funds for the purchase or
payment of) such Indebtedness or other obligation or to purchase
(or to advance or supply funds for the purchase of) any security
for the payment thereof (whether in the form of a loan, advance,
stock purchase, capital contribution or otherwise), (b)&nbsp;to
purchase or lease property, securities or services for the
purpose of assuring the owner of such Indebtedness or other
obligation of the payment thereof, (c)&nbsp;to maintain working
capital, equity capital solvency, or any other balance sheet,
income statement or other financial statement condition or
liquidity of the primary credit party so as to enable the primary
credit party to pay such Indebtedness or other obligation,
(d)&nbsp;as an account party in respect of any letter of credit
or letter of guarantee issued to support such Indebtedness or
other obligation, (e)&nbsp;to make take-or-pay or similar
payments, if required, regardless of non-performance by any other
party or parties to an agreement, or (f)&nbsp;to purchase, sell
or lease (as lessor or lessee) property, or to purchase or sell
services, primarily for the purpose of enabling the debtor to
make payment of such Indebtedness or to assure the holder of such
Indebtedness against loss. The amount of any Guarantee in respect
of Indebtedness shall be deemed to be an amount equal to the
stated or determinable amount of the related Indebtedness (unless
the Guarantee is limited by its terms to a lesser amount, in
which case to the extent of such amount) or, if not stated or
determinable, the maximum reasonably anticipated liability in
respect thereof as determined by the Person in good faith. The
amount of any other Guarantee shall be deemed to be zero unless
and until the amount thereof has been (or in accordance with GAAP
should be) quantified and reflected or disclosed in the
consolidated financial statements (or notes thereto)) of the
Borrower.</p>

<p>&quot;<u>Hedging Agreement</u>&quot; means any hedging
contract, forward contract, swap agreement, futures contract,
option contract, cap or collar agreement with respect to any such
transaction (or any combination of the foregoing, or any
derivative thereof), designed to mitigate risks resulting from
fluctuations in interests rates, currency valuations or
otherwise.</p>

<p>&quot;<u>Indebtedness</u>&quot; of any Person includes,
without duplication, (a)&nbsp;all obligations of such Person for
borrowed money or with respect to deposits or advances of any
kind, (b)&nbsp;all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, (c)&nbsp;all
obligations of such Person upon which interest charges are
customarily paid, (d)&nbsp;all obligations of such Person under
conditional sale or other title retention agreements relating to
property acquired by such Person, (e)&nbsp;all obligations of
such Person in respect of the deferred purchase price of property
or services (excluding current accounts payable incurred in the
ordinary course of business), (f)&nbsp;all Indebtedness of others
secured by (or for which the holder of such Indebtedness has an
existing right, contingent or otherwise, to be secured by) any
Lien on property owned or acquired by such Person, whether or not
the Indebtedness secured thereby has been assumed, (g)&nbsp;all
Guarantees by such Person of Indebtedness of others, (h)&nbsp;all
Capital Lease Obligations of such Person, (i)&nbsp;all
obligations, contingent or otherwise, of such Person as an
account party in respect of letters of credit and letters of
guarantee, (j)&nbsp;all obligations, contingent or otherwise, of
such Person in respect of bankers&#146; acceptances, (k)&nbsp;the
net amount of obligations of such Person (determined on a
marked-to-market basis) under Hedging Agreements, and
(l)&nbsp;all obligations of such Person to purchase, redeem,
retire, defease or otherwise acquire for value (other than for
other Equity Securities) any Equity Securities of such Person
valued, in the case of redeemable Equity Securities, at the
greater of voluntary or involuntary liquidation preference, plus
accrued and unpaid dividends. The Indebtedness of any Person
shall include the Indebtedness of any other entity (including any
partnership in which such Person is a general or limited partner)
to the extent such Person is liable therefor as a result of such
Person&#146;s ownership interest in or other relationship with
such entity, except to the extent the terms of such Indebtedness
provide that such Person is not liable therefor<b>.</b></p>

<p>&quot;<u>Indemnified Taxes</u>&quot; means all Taxes other
than Excluded Taxes.</p>

<p>&quot;<u>Indemnitee</u>&quot; has the meaning specified in
Section 8.3(b). </p>

<p>&quot;<u>Interest Payment Date</u>&quot; means the first
Business Day of each month and the Maturity Date.</p>

<p>&quot;<u>Laws</u>&quot; means all federal, provincial,
municipal, foreign and international statutes, acts, codes,
ordinances, decrees, treaties, rules, regulations, municipal
by-laws, judicial or arbitral or administrative or ministerial or
departmental or regulatory judgments, orders, decisions, rulings
or awards or any provisions of the foregoing, including general
principles of common and civil law and equity, and all policies,
practices and guidelines of any Governmental Authority binding on
or affecting the Person referred to in the context in which such
word is used (including, in the case of tax matters, any accepted
practice or application or official interpretation of any
relevant taxation authority); and &quot;<u>Law</u>&quot; means
any one or more of the foregoing. </p>

<p>&quot;<u>Lender</u>&quot; means Canadian Imperial Bank of
Commerce, a bank chartered under the <i>Bank Act</i> (Canada),
and its successors and permitted assigns.</p>

<p>&quot;<u>Liabilities to Equity Ratio</u>&quot; means, with
respect to any Person as at any date, the ratio of the following:</p>

<p>(a) all liabilities of such Person and its consolidated
subsidiaries, except for Fahnestock &amp; Co. for which
liabilities means unsecured liabilities, at such date that should
be classified as liabilities on a balance sheet prepared in
accordance with GAAP, including (without limitation) all
indebtedness and all reserves and all deferred taxes and other
deferred items (determined on a consolidated basis without
duplication in accordance with GAAP), <u>to</u></p>

<p>(b) the amount of paid-up capital of such Person at such date,<i>
</i><u>plus</u> the amount of such Person&#146;s surplus and
retained earnings (howsoever described) at such date (or, in the
case of a surplus or retained earnings deficit, <u>minus</u> the
amount of such deficit), all determined in accordance with GAAP
on a consolidated basis.</p>

<p>&quot;<u>Lien</u>&quot; means, (a)&nbsp;with respect to any
asset, any mortgage, deed of trust, lien, pledge, hypothecation,
encumbrance, charge, security interest, royalty interest, adverse
claim, defect of title or right of set off in, on or of such
asset, (b)&nbsp;the interest of a vendor or a lessor under any
conditional sale agreement, capital lease, title retention
agreement or consignment agreement (or any financing lease having
substantially the same economic effect as any of the foregoing)
relating to any asset, (c)&nbsp;in the case of securities, any
purchase option, call or similar right of a third party with
respect to such securities, (d)&nbsp;any netting arrangement,
defeasance arrangement or reciprocal fee arrangement, and
(e)&nbsp;any other arrangement having the effect of providing
security.</p>

<p>&quot;<u>Loan</u>&quot; means any loan made by the Lender to
the Borrower pursuant to this Agreement.</p>

<p>&quot;<u>Material Adverse Change</u>&quot; means any event,
development or circumstance that has had or could<b> </b>in the
opinion of the Lender have a Material Adverse Effect.</p>

<p>&quot;<u>Material Adverse Effect</u>&quot; means a material
adverse effect on (a)&nbsp;the business, assets, operations,
prospects or condition, financial or otherwise, of the Borrower
and its Subsidiaries taken as a whole, or (b)&nbsp;the validity
or enforceability of any of the Financing Documents or the rights
and remedies of the Lender thereunder, or (c)&nbsp;the amount
which the Lender would be likely to receive (after giving effect
to delays in payment and costs of enforcement) upon the
liquidation of the Collateral.</p>

<p>&quot;<u>Maturity Date</u>&quot; means the fifth anniversary
of the Closing Date.</p>

<p>&quot;<u>Net Capital</u>&quot; means &quot;net capital&quot;
as that term is defined in the Net Capital Rule.</p>

<p>&quot;<u>Net Capital Rule</u>&quot; means Rule 15c3-1
promulgated under the <i>Securities Exchange Act of 1934</i>, as
such rule may be in effect from time to time, including any
successor rule under said Act relating to net capital
requirements of registered broker-dealers.</p>

<p>&quot;<u>Permitted Distributions</u>&quot; means (i) dividends
paid to holders of Equity Securities of the Borrower in the
ordinary course and consistent with past practice, and (ii)
payments made pursuant to a normal course issuer bid by the
Borrower, and permitted by Toronto Stock Exchange rules governing
such purchases: provided that, at all times, the amount of
paid-up capital of the Borrower plus the amount of the
Borrower&#146;s surplus and retained earnings (or in the case of
a surplus or retained earnings deficit, <u>minus</u> the amount
of such deficit) all determined in accordance with GAAP on a
consolidated basis, is not less than U.S.$200,000,000.</p>

<p>&quot;<u>Permitted Liens</u>&quot; means, with respect to any
Person, the following:</p>

<p>(a) Liens for taxes, assessments or governmental charges or
levies which are not due or delinquent or, if so, the validity of
which is being contested at the time by the Borrower diligently
and in good faith by proper legal proceedings (and written notice
thereof has been given to the Lender) if either (i) adequate
provision has been made for the payment of the obligations
secured or intended to be secured by the applicable Liens or (ii)
the applicable Liens are not in the aggregate materially
prejudicial to the value of the assets of the Borrower;</p>

<p>(b) undetermined or inchoate Liens, rights of distress and
charges incidental to current operations which have not at such
time been filed or exercised and of which the Lender has not been
given notice, or which relate to obligations not due or payable;</p>

<p>(c) Liens disclosed to the Lender in Schedule C;</p>

<p>(d) other Liens and minor irregularities in title which do not
materially interfere with the occupation, use and enjoyment by
the Companies of any of their respective properties in the normal
course of business as presently conducted or materially impair
the value thereof of such business;</p>

<p>(e) Liens consented to in writing by the Lender; and</p>

<p>(f) Liens created by the Security Documents.</p>

<p>&quot;<u>Person</u>&quot; includes any natural person,
corporation, company, limited liability company, trust, joint
venture, association, incorporated organization, partnership,
Governmental Authority or other entity.</p>

<p>&quot;<u>Related Parties</u>&quot; means, with respect to any
Person, such Person&#146;s Affiliates and the respective
directors, officers, employees, agents and advisors of such
Person and of such Person&#146;s Affiliates.</p>

<p>&quot;<u>Responsible Officer</u>&quot; means, with respect to
any corporation, the chairman, the president, any vice president,
the chief executive officer or the chief operating officer, and,
in respect of financial or accounting matters, any Financial
Officer of such corporation; unless otherwise specified, all
references herein to a Responsible Officer mean a Responsible
Officer of the Borrower.</p>

<p>&quot;<u>Restricted Payment</u>&quot; shall mean, with respect
to any Person, any payment by such Person (i)&nbsp;of any
dividends on any of its Equity Securities, (ii)&nbsp;on account
of, or for the purpose of setting apart any property for a
sinking or other analogous fund for, the purchase, redemption,
retirement or other acquisition of any of its Equity Securities
or any warrants, options or rights to acquire any such shares, or
the making by such Person of any other distribution in respect of
any of its Equity Securities, (iii)&nbsp;of any principal of or
of any amount in respect of a sinking or analogous fund or
defeasance fund for any Indebtedness of such Person to a
shareholder of such Person or to an Affiliate of a shareholder of
such Person, and (iv) pursuant to a normal course issuer bid.</p>

<p>&quot;<u>Security Documents</u>&quot; means the agreements or
instruments described or referred to in Section 4.1(g), and any
and all other agreements or instruments now or hereafter executed
and delivered by the Borrower, any Subsidiary or any other Person
as security for the payment or performance of the obligations of
the Borrower hereunder, as any of the foregoing may have been, or
may hereafter be, amended, modified or supplemented.</p>

<p>&quot;<u>subsidiary</u>&quot; means, with respect to any
Person (the &quot;<u>Parent</u>&quot;) at any date, any
corporation, limited liability company, partnership, limited
partnership, association or other entity the accounts of which
would be consolidated with those of the Parent in the
Parent&#146;s consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date,
as well as any other corporation, limited liability company,
partnership, limited partnership, association or other entity
(a)&nbsp;of which securities or other ownership interests
representing more than 50% of the equity or more than 50% of the
ordinary voting power or, in the case of a partnership, more than
50% of the general partnership interests are, as of such date,
owned, controlled or held, or (b)&nbsp;that is, as of such date,
otherwise controlled, by the Parent or one or more subsidiaries
of the Parent or by the Parent and one or more subsidiaries of
the Parent.</p>

<p>&quot;<u>Subsidiary</u>&quot; means any subsidiary of the
Borrower.</p>

<p>&quot;<u>Taxes</u>&quot; means all taxes, charges, fees,
levies, imposts and other assessments, including all income,
sales, use, goods and services, value added, capital, capital
gains, alternative, net worth, transfer, profits, withholding,
payroll, employer health, excise, real property and personal
property taxes, and any other taxes, customs duties, fees,
assessments, or similar charges in the nature of a tax, including
pension plan contributions, unemployment insurance payments and
workers&#146; compensation premiums, together with any
instalments with respect thereto, and any interest, fines and
penalties with respect thereto, imposed by any Governmental
Authority (including federal, state, provincial, municipal and
foreign Governmental Authorities), and whether disputed or not.</p>

<p>&quot;<u>Transactions</u>&quot; means the execution, delivery
and performance by the Borrower of this Agreement and the other
Financing Documents, the borrowing of Loans and the use of the
proceeds thereof.</p>

<p>&quot;<u>U.S. Base Rate</u>&quot; means, on any day, the
annual rate of interest equal to the greater of (i) the annual
rate of interest announced by the Lender and in effect as its
base rate at its principal office in Toronto, Ontario on such day
for determining interest rates on U.S. Dollar-denominated
commercial loans made in Canada, and (ii) the Federal Funds
Effective Rate plus 0.50%.</p>

<p>&quot;<u>U.S. Base Rate Loan</u>&quot; means a Loan
denominated in U.S. Dollars which bears interest at a rate based
upon the U.S. Base Rate.</p>

<p>&quot;<u>U.S. Dollars</u>&quot; and &quot;<u>U.S.$</u>&quot;
refer to lawful money of the United States of America.</p>

<p>&quot;<u>U.S.$ Equivalent</u>&quot; means, at the date of
determination, the amount of U.S. Dollars that the Lender could
purchase, in accordance with its normal practice, with a
specified amount of Canadian Dollars based on the Bank of Canada
noon spot rate on such date.</p>

<p>&quot;<u>Viner Finance</u>&quot; means Viner Finance Inc., a
corporation incorporated under the laws of the State of Delaware,
and its successor and permitted assigns.</p>

<p>&quot;<u>Viner International</u>&quot; means E.A. Viner
International Co., a corporation incorporated under the laws of
the State of Delaware, and its successor and permitted assigns.</p>

<p>&quot;<u>wholly-owned subsidiary</u>&quot; of a Person means
any subsidiary of such Person of which securities or other
ownership interests representing 100% of the equity and 100% of
the ordinary voting power are, at the time any determination is
being made, owned, controlled or held by such Person or one or
more subsidiaries of such Person or by such Person and one or
more subsidiaries of such Person.</p>

<p><b>1.2 </b><font color="#0000FF"><b>Terms Generally</b></font>.
The definitions of terms herein shall apply equally to the
singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words
&quot;include&quot;, &quot;includes&quot; and
&quot;including&quot; shall be deemed to be followed by the
phrase &quot;without limitation&quot;. The word &quot;will&quot;
shall be construed to have the same meaning and effect as the
word &quot;shall&quot;. The word &quot;or&quot; is disjunctive;
the word &quot;and&quot; is conjunctive. The word
&quot;shall&quot; is mandatory; the word &quot;may&quot; is
permissive. The words &quot;to the knowledge of&quot; means, when
modifying a representation, warranty or other statement of any
Person, that the fact or situation described therein is known by
the Person (or, in the case or a Person other than a natural
Person, known by the Responsible Officer of that Person) making
the representation, warranty or other statement, or with the
exercise of reasonable due diligence under the circumstances (in
accordance with the standard of what a reasonable Person in
similar circumstances would have done) would have been known by
the Person (or, in the case of a Person other than a natural
Person, would have been known by such Responsible Officer of that
Person). Unless the context requires otherwise (a)&nbsp;any
definition of or reference to any agreement, instrument or other
document herein shall be construed as referring to such
agreement, instrument or other document as from time to time
amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set
forth herein), (b)&nbsp;any reference herein to any statute or
any section thereof shall, unless otherwise expressly stated, be
deemed to be a reference to such statute or section as amended,
restated or re-enacted from time to time, (c)&nbsp;any reference
herein to any Person shall be construed to include such
Person&#146;s successors and permitted assigns, (d)&nbsp;the
words &quot;herein&quot;, &quot;hereof&quot; and
&quot;hereunder&quot;, and words of similar import, shall be
construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (e)&nbsp;all references herein
to Articles, Sections, Exhibits and Schedules shall be construed
to refer to Articles and Sections of, and Exhibits and Schedules
to, this Agreement, and (f)&nbsp;the words &quot;asset&quot; and
&quot;property&quot; shall be construed to have the same meaning
and effect and to refer to any and all tangible and intangible
assets and properties, including cash, securities, accounts and
contract rights. </p>

<p><b>1.3 </b><font color="#0000FF"><b>Accounting Terms; GAAP</b></font><b>.</b>
Except as otherwise expressly provided herein, all terms of an
accounting or financial nature shall be construed in accordance
with GAAP, as in effect from time to time. All calculations for
the purposes of determining compliance with the financial ratios
and financial covenants contained herein shall be made on a basis
consistent with GAAP in existence as at the date of this
Agreement and used in the preparation of the financial statements
of the Borrower referred to in Section 5.1(a). In the event of a
change in GAAP, the Borrower and the Lender shall negotiate in
good faith to revise (if appropriate) such ratios and covenants
to reflect GAAP as then in effect. In the event that such
negotiation is successful, all calculations thereafter made for
the purpose of determining compliance with the financial ratios
and financial covenants contained herein shall be made on a basis
consistent with GAAP in existence as at the date of such
revision. Any financial ratios required to be maintained by the
Borrower pursuant to this Agreement shall be calculated by
dividing the appropriate component by the other component,
carrying the result to one place more than the number of places
by which such ratio is expressed in this Agreement and rounding
the result up or down to the nearest number (with a round-up if
there is no nearest number) to the number of places by which such
ratio is expressed in this Agreement.</p>

<p><b>1.4 </b><font color="#0000FF"><b>Time</b></font><b>.</b>
All time references herein shall, unless otherwise specified, be
references to local time in Toronto, Canada. Time is of the
essence of this Agreement and the other Financing Documents.</p>

<p><b>1.5 </b><font color="#0000FF"><b>This Agreement to Govern.</b></font>
In the event of any conflict or inconsistency between the terms
of this Agreement and the terms of any other Financing Documents,
the provisions of this Agreement shall govern to the extent
necessary to remove the conflict or resolve the inconsistency.</p>

<p align="center"><b>ARTICLE 2</b><font color="#0000FF"><b><br>
THE CREDIT</b></font></p>

<p><b>2.1 </b><font color="#0000FF"><b>Commitment</b></font><b>.</b>
Subject to the terms and conditions set forth herein, the Lender
commits to make U.S. Base Rate Loans to the Borrower in one or
two drawdowns during the period commencing on the Closing Date
and ending on July 31, 2003, or as otherwise mutually agreed by
the parties hereto (the &quot;<u>Commitment</u>&quot;), in an
aggregate principal amount of the lesser of (i) U.S.$50,000,000,
and (ii) the aggregate amount of new employee loans made to
employees of Fahnestock &amp; Co. and evidenced by Employee
Notes.</p>

<p><b>2.2 </b><font color="#0000FF"><b>Requests for Borrowings</b></font><b>.</b>
To request a Borrowing, the Borrower shall notify the Lender of
such request by telephone or by written Borrowing Request, not
later than 11:00 a.m., Toronto time, one Business Day before the
date of the proposed Borrowing. Each such telephone borrowing
request shall be irrevocable and shall be confirmed promptly by
hand delivery or telecopy to the Lender of a written Borrowing
Request signed by the Borrower by 12:00 noon on the date of such
telephone borrowing request. The Lender is entitled to rely upon
and act upon any telephone borrowing request or written Borrowing
Request given or purportedly given by the Borrower, and the
Borrower hereby waives the right to dispute the authenticity and
validity of any such transaction once the Lender has advanced
funds based on such telephone borrowing request or written
Borrowing Request. Each such telephone borrowing request and
written Borrowing Request shall specify the following
information:</p>

<blockquote>
    <blockquote>
        <blockquote>
            <blockquote>
                <blockquote>
                    <blockquote>
                        <p>(i) the aggregate amount of the
                        requested Borrowing;</p>
                        <p>(ii) the date of such Borrowing, which
                        shall be a Business Day; and</p>
                        <p>(iii) the location and number of the
                        Borrower&#146;s account to which funds
                        are to be disbursed.</p>
                    </blockquote>
                </blockquote>
            </blockquote>
        </blockquote>
    </blockquote>
</blockquote>

<p><b>2.3 </b><font color="#0000FF"><b>Funding of Borrowings</b></font><b>.</b>
The Lender shall make each Loan to be made to the Borrower by
crediting, by 12:00 noon, Toronto time, the funds applicable to
each Borrowing Request, to an account of the Borrower maintained
with the Lender in Toronto and designated by the Borrower in such
Borrowing Request.</p>

<p><b>2.4 </b><font color="#0000FF"><b>Interest</b></font><b>.</b></p>

<p>(a) The Loans comprising each Borrowing shall bear interest
(computed on the basis of the actual number of days elapsed over
a year of 365 days or 366 days, as the case may be) at a rate per
annum equal to the U.S. Base Rate plus 2% per annum.
Notwithstanding the foregoing, if any principal of or interest on
any Loan or any fee or other amount payable by the Borrower
hereunder is not paid when due, whether at stated maturity, upon
acceleration or otherwise, such overdue amount shall bear
interest, after as well as before judgment, at a rate per annum
equal to 2% plus the rate otherwise applicable to such Loan.</p>

<p>(b) Accrued interest on each Loan shall be payable in arrears
on each Interest Payment Date and,&nbsp;in the event of any
repayment or prepayment of any Loan, accrued interest on the
principal amount repaid or prepaid shall be payable on the date
of such repayment or prepayment. </p>

<p>(c) All interest hereunder shall be payable for the actual
number of days elapsed (including the first day but excluding the
last day). The applicable U.S. Base Rate shall be determined by
the Lender, and such determination shall be conclusive absent
manifest error.</p>

<p>(d) For the purposes of the <i>Interest Act </i>(Canada) and
disclosure thereunder, whenever any interest or any fee to be
paid hereunder or in connection herewith is to be calculated on
the basis of a year of less than 365 days, or 366 days, as
applicable, the yearly rate of interest to which the rate used in
such calculation is equivalent is the rate so used multiplied by
the actual number of days in the calendar year in which the same
is to be ascertained and divided by the number of days on which
the rate is calculated. The rates of interest under this
Agreement are nominal rates, and not effective rates or yields.
The principle of deemed reinvestment of interest does not apply
to any interest calculation under this Agreement.</p>

<p>(e) If any provision of this Agreement would oblige the
Borrower to make any payment of interest or other amount payable
to the Lender in an amount or calculated at a rate which would be
prohibited by law or would result in a receipt by that Lender of
&quot;interest&quot; at a &quot;criminal rate&quot; (as such
terms are construed under the <i>Criminal Code </i>(Canada)),
then, notwithstanding such provision, such amount or rate shall
be deemed to have been adjusted with retroactive effect to the
maximum amount or rate of interest, as the case may be, as would
not be so prohibited by Law or so result in a receipt by that
Lender of &quot;interest&quot; at a &quot;criminal rate&quot;,
such adjustment to be effected, to the extent necessary (but only
to the extent necessary), by reducing any fees, commissions,
premiums and other amounts required to be paid to the Lender
which would constitute interest for purposes of Section 347 of
the <i>Criminal Code </i>(Canada).</p>

<p>(f) If any payment of interest is required to be made on a day
which is not a Business Day, such payment shall be payable on the
immediately preceding Business Day.</p>

<p><b>2.5 </b><font color="#0000FF"><b>Intentionally Deleted.</b></font><b>
</b></p>

<p><b>2.6 </b><font color="#0000FF"><b>Repayment of Loans</b></font><b>.</b></p>

<p>(a) The Borrower hereby unconditionally promises to
pay&nbsp;to the Lender the then unpaid principal amount of each
Loan on the Maturity Date together with all accrued interest, all
fees and other amounts outstanding hereunder.</p>

<p>(b) The aggregate outstanding principal amount of the Loans
shall be repaid (i) from the Closing Date until the second
drawdown, in monthly instalments equal to one sixtieth of the
amount of the first drawdown, payable on each Interest Payment
Date commencing on February 1, 2003, and (ii) from the date of
the second drawdown until the Maturity Date, in equal monthly
instalments payable on each Interest Payment Date, equal to the
total principal amount outstanding following the second drawdown,
divided by the number of Interest Payment Dates remaining up to,
and including, the Maturity Date.</p>

<p>(c) If any payment of principal is required to be made on a
day which is not a Business Day, such payment shall be payable on
the immediately preceding Business Day.</p>

<p><b>2.7 </b><font color="#0000FF"><b>Evidence of Debt</b></font><b>.</b></p>

<p>(a) The Lender shall maintain in accordance with its usual
practice an account or accounts evidencing the Indebtedness of
the Borrower to the Lender resulting from each Loan made by the
Lender hereunder, including the amounts of principal and interest
payable and paid to the Lender from time to time hereunder.</p>

<p>(b) The entries made in the accounts maintained pursuant to
Section 2.7(a) shall be conclusive evidence (absent manifest
error) of the existence and amounts of the obligations recorded
therein; <u>provided</u> that the failure of the Lender to
maintain such accounts or any error therein shall not in any
manner affect the obligation of the Borrower to repay the Loans
in accordance with the terms of this Agreement.</p>

<p><b>2.8 </b><font color="#0000FF"><b>Prepayments</b></font><b>.</b></p>

<p>(a) <u>Mandatory Prepayments</u>. If the aggregate amount of
payments and forgiveness of Employee Notes for any month is in
excess of the instalment payment due in such month, the Borrower
shall immediately pay to the Lender the amount of such excess to
be applied&nbsp;as a prepayment of the Loans outstanding to
instalment payments required by Section 2.6(b) in inverse order
of maturity.</p>

<p>(b) <u>Voluntary Prepayments</u>. The Borrower may, at its
option, at any time and from time to time, prepay the Loans, in
whole or in part, without notice to the Lender with such
prepayment to be applied to instalment payments required by
Section 2.6(b) in inverse order of maturity.</p>

<p><b>2.9 </b><font color="#0000FF"><b>Increased Costs;
Illegality</b></font>.</p>

<p>(a) If any Change in Law shall impose, modify or deem
applicable any reserve, special deposit or similar requirement
against assets of, deposits with or for the account of, or credit
extended by, the Lender and the result of any of the foregoing
shall be to increase the cost to the Lender of making or
maintaining any Loan (or of maintaining its obligation to make
any such Loan) or to increase the cost to the Lender of issuing
or maintaining any Loan or to reduce the amount of any sum
received or receivable by the Lender hereunder (whether of
principal, interest or otherwise), then the Borrower will pay to
the Lender such additional amount or amounts as will compensate
the Lender for such additional costs incurred or reduction
suffered.</p>

<p>(b) A certificate of the Lender setting forth the amount or
amounts necessary to compensate the Lender as specified in
Section 2.9(a), together with a brief description of the Change
of Law, shall be delivered to the Borrower, and shall be
conclusive absent manifest error. The Borrower shall pay the
Lender the amount shown as due on any such certificate within
ten&nbsp;days after receipt thereof.</p>

<p>(c) Failure or delay on the part of the Lender to demand
compensation pursuant to this Section 2.9 shall not constitute a
waiver of the Lender&#146;s right to demand such compensation.</p>

<p><b>2.10 </b><font color="#0000FF"><b>Break Funding Payments</b></font>.
In the event of the failure by the Borrower to borrow or prepay
any Loan on the date specified in any notice delivered by the
Borrower pursuant hereto, the Borrower shall compensate the
Lender for the loss, cost and expense attributable to such event.
A certificate of the Lender setting forth any amount or amounts
that the Lender is entitled to receive pursuant to this Section
2.10 shall be delivered to the Borrower and shall be conclusive
absent manifest error. The Borrower shall pay the Lender the
amount shown as due on any such certificate within ten&nbsp;days
after receipt thereof. </p>

<p><b>2.11 </b><font color="#0000FF"><b>Taxes</b></font>. </p>

<p>(a) Any and all payments by or on account of any obligation of
the Borrower hereunder shall be made free and clear of and
without deduction for any Indemnified Taxes; provided that if the
Borrower shall be required to deduct any Indemnified Taxes from
such payments, then (i)&nbsp;the sum payable shall be increased
as necessary so that, after making all required deductions
(including deductions applicable to additional sums payable under
this Section 2.11), the Lender receives an amount equal to the
sum it would have received had no such deduction been made,
(ii)&nbsp;the Borrower shall make such deduction, and
(iii)&nbsp;the Borrower shall pay the full amount deducted to the
relevant Governmental Authority in accordance with applicable
Law.</p>

<p>(b) In addition to the payments by the Borrower required by
Section 2.11(a), the Borrower shall pay any and all present or
future stamp or documentary Taxes or any other excise or property
Taxes, charges or similar levies arising from any payment made
hereunder or from the execution, delivery or enforcement of, or
otherwise with respect to, this Agreement to the relevant
Governmental Authority in accordance with applicable Law.</p>

<p>(c) The Borrower shall indemnify the Lender, within
ten&nbsp;days after written demand therefor, for the full amount
of any Indemnified Taxes paid by the Lender, on or with respect
to any payment by or on account of any obligation of the Borrower
hereunder (including Indemnified Taxes imposed or asserted on or
attributable to amounts payable under this Section 2.11) and any
penalties, interest and reasonable expenses arising therefrom or
with respect thereto, whether or not such Indemnified Taxes were
correctly or legally imposed or asserted by the relevant
Governmental Authority. A certificate as to the amount of such
payment or liability delivered to the Borrower by the Lender
shall be conclusive absent manifest error.</p>

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

<p><b>2.12 </b><font color="#0000FF"><b>Currency Indemnity</b></font>.
If, for the purposes of obtaining judgment in any court in any
jurisdiction with respect to this Agreement or any other
Financing Document, it becomes necessary to convert into the
currency of such jurisdiction (the &quot;<u>Judgment Currency</u>&quot;)
any amount due under this Agreement or under any other Financing
Document in any currency other than the Judgment Currency (the
&quot;<u>Currency Due</u>&quot;), then conversion shall be made
at the rate of exchange prevailing on the Business Day before the
day on which judgment is given. For this purpose &quot;rate of
exchange&quot; means the rate at which the Lender is able, on the
relevant date, to purchase the Currency Due with the Judgment
Currency in accordance with its normal practice at its head
office in Toronto, Ontario. In the event that there is a change
in the rate of exchange prevailing between the Business Day
before the day on which the judgment is given and the date of
receipt by the Lender of the amount due, the Borrower will, on
the date of receipt by the Lender, pay such additional amounts,
if any, or be entitled to receive reimbursement of such amount,
if any, as may be necessary to ensure that the amount received by
the Lender on such date is the amount in the Judgment Currency
which when converted at the rate of exchange prevailing on the
date of receipt by the Lender is the amount then due under this
Agreement or such other Financing Document in the Currency Due.
If the amount of the Currency Due which the Lender is so able to
purchase is less than the amount of the Currency Due originally
due to it, the Borrower shall indemnify and save the Lender
harmless from and against all loss or damage arising as a result
of such deficiency. This indemnity shall constitute an obligation
separate and independent from the other obligations contained in
this Agreement and the other Financing Documents, shall give rise
to a separate and independent cause of action, shall apply
irrespective of any indulgence granted by the Lender from time to
time and shall continue in full force and effect notwithstanding
any judgment or order for a liquidated sum in respect of an
amount due under this Agreement or any other Financing Document
or under any judgment or order.</p>

<p align="center"><b>ARTICLE 3</b><font color="#0000FF"><b><br>
REPRESENTATIONS AND WARRANTIES</b></font></p>

<p>The Borrower represents and warrants to the Lender that:</p>

<p><b>3.1 </b><font color="#0000FF"><b>Organization; Powers</b></font>.
Each of the Borrower and its Subsidiaries is duly organized and
validly existing under the laws of the jurisdiction of its
organization, has all requisite power and authority to carry on
its business as now and formerly conducted and is qualified to do
business in, and is in good standing in, every jurisdiction where
such qualification is required.</p>

<p><b>3.2 </b><font color="#0000FF"><b>Authorization;
Enforceability</b></font>. The Transactions are within the
Companies&#146; corporate powers and have been duly authorized by
all necessary corporate and, if required, shareholder action.
This Agreement and the other Financing Documents have been duly
executed and delivered by the Companies (as applicable) and
constitute legal, valid and binding obligations of the Companies
(as applicable), enforceable in accordance with their terms,
subject to applicable bankruptcy, insolvency, reorganisation,
moratorium or other Laws affecting creditors&#146; rights
generally and subject to general principles of equity, regardless
of whether considered in a proceeding in equity or at law.</p>

<p><b>3.3 </b><font color="#0000FF"><b>Governmental Approvals; No
Conflicts</b></font>. The Transactions (a)&nbsp;do not require
any consent or approval of, registration or filing with, or any
other action by, any Governmental Authority, except as disclosed
in Schedule&nbsp;B, (b)&nbsp;will not violate any applicable Law
or the charter, by-laws or other organizational documents of the
Companies or any order of any Governmental Authority,
(c)&nbsp;will not violate or result in a default under any
indenture, agreement or other instrument binding upon the
Companies or their respective assets, or give rise to a right
thereunder to require any payment to be made by the Companies,
and (d)&nbsp;will not result in the creation or imposition of any
Lien on any asset of the Companies, except for any Lien arising
in favour of the Lender under the Financing Documents.</p>

<p><b>3.4 </b><font color="#0000FF"><b>Financial Condition; No
Material Adverse Effect</b></font>.</p>

<p>(a) The Borrower has furnished to the Lender its consolidated
balance sheets and statements of income, retained earnings and
changes in financial position (i)&nbsp;as of and for the Fiscal
Year ended December 31, 2001, reported on by its auditors, and
(ii)&nbsp;as of and for the Fiscal Quarter and the portion of the
Fiscal Year ended September 30, 2002, certified by a Responsible
Officer. Such financial statements present fairly, in all
material respects, the consolidated financial position and
results of operations and cash flows of the Borrower as of such
dates and for such periods in accordance with GAAP, subject to
year-end audit adjustments and the absence of footnotes in the
case of the statements referred to in clause (ii) above.</p>

<p>(b) All information (including that disclosed in all financial
statements) pertaining to the Borrower and its consolidated
Subsidiaries (the &quot;<u>Information</u>&quot;) that has been
or will be made available to the Lender by the Borrower or any
representative of the Borrower, taken as a whole, is or will be,
when furnished, complete and correct in all material respects and
does not or will not, when furnished, contain any untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements contained therein not
materially misleading in light of the circumstances under which
such statements are made. The projections that have been or will
be made available to the Lender by the Borrower or any
representative of the Borrower have been or will be prepared in
good faith based upon reasonable assumptions. </p>

<p><b>3.5 </b><font color="#0000FF"><b>Litigation</b></font>. </p>

<p>(a) Except as disclosed in Schedule&nbsp;A, there are no
actions, suits or proceedings (including any Tax-related matter)
by or before any arbitrator or Governmental Authority pending
against or, to the knowledge of the Borrower, threatened against
or affecting the Borrower or any of the Subsidiaries (i)&nbsp;as
to which there is a reasonable possibility of an adverse
determination and that, if adversely determined, could reasonably
be expected, individually or in the aggregate, to result in a
Material Adverse Effect (other than the Disclosed Matters), or
(ii)&nbsp;that involve this Agreement, any other Financing
Document, or the Transactions.</p>

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

<p><b>3.6 </b><font color="#0000FF"><b>Compliance with Laws and
Agreements</b></font>. Each of the Companies is in compliance
with all Laws applicable to it or its property and all
indentures, agreements and other instruments binding upon it or
its property, except where the failure to do so, individually or
in the aggregate, could not reasonably be expected to result in a
Material Adverse Effect. None of the Companies has violated or
failed to obtain any Authorization necessary to the ownership of
any of its property or assets or the conduct of its business,
which violation or failure could reasonably be expected to have
(in the event that such a violation or failure were asserted by
any Person through appropriate action) a Material Adverse Effect.</p>

<p><b>3.7 </b><font color="#0000FF"><b>Taxes</b></font>. The
Companies have timely filed or caused to be filed all Tax returns
and reports required to have been filed and have paid or caused
to be paid, or have adequately reserved for, all Taxes required
to have been paid by them (including all instalments with respect
to the current period) and have made adequate provision for Taxes
for the current period except for Taxes that are being contested
in good faith by appropriate proceedings and for which the
applicable Company has set aside on its books adequate reserves.</p>

<p><b>3.8 </b><font color="#0000FF"><b>Titles to Personal
Property</b></font>. The Companies, other than Fahnestock &amp;
Co., have title to their respective owned personal properties,
and with respect to leased personal properties, title to the
leasehold estate with respect thereto, pursuant to valid and
enforceable leases, free and clear of all Liens except Permitted
Liens.</p>

<p><b>3.9 </b><font color="#0000FF"><b>Disclosure</b></font><b>.</b>
The Borrower has disclosed to the Lender all agreements,
instruments and corporate or other restrictions to which it or
any of the Subsidiaries is subject, and all other matters known
to it, that, individually or in the aggregate, could reasonably
be expected to result in a Material Adverse Effect. All
liabilities of the Borrower have been disclosed to the Lender in
writing.</p>

<p><b>3.10 </b><font color="#0000FF"><b>Defaults</b></font><b>.</b>
Neither the Borrower nor any Subsidiary is in default nor has any
event or circumstance occurred which, but for the passage of time
or the giving of notice, or both, would constitute a default (in
any respect that would have a Material Adverse Effect) under any
loan or credit agreement, indenture, mortgage, deed of trust,
security agreement or other instrument or agreement evidencing or
pertaining to any Indebtedness of the Borrower or any Subsidiary,
or under any material agreement or instrument to which the
Borrower or any Subsidiary is a party or by which the Borrower or
any Subsidiary is bound, except as disclosed to the Lender in
Schedule&nbsp;D. No Default has occurred and is continuing.</p>

<p><b>3.11 </b><font color="#0000FF"><b>Subsidiaries</b></font><b>.</b>
As of the date hereof, Schedule&nbsp;E correctly sets forth the
(i)&nbsp;names, (ii)&nbsp;form of legal entity, (iii)&nbsp;the
percentage ownership of each entity in which the Borrower or any
Subsidiary has an ownership interest, and (iv)&nbsp;jurisdictions
of organization of all Subsidiaries of the Borrower. Except as
described in Schedule&nbsp;E, as of the date hereof, the Borrower
does not own any Equity Securities or debt securities which are
convertible into, or exchangeable for, Equity Securities of any
Person. </p>

<p><b>3.12 </b><font color="#0000FF"><b>Insurance</b></font><b>.</b>
All policies of fire, liability, workers&#146; compensation,
casualty, flood, business interruption and other forms of
insurance owned or held by the Borrower and each of the
Subsidiaries provide adequate insurance coverage in at least such
amounts and against at least such risks (but including in any
event public liability) as are usually insured against in the
same general area by companies engaged in the same or a similar
business for the assets and operations of the Borrower and each
Subsidiary. All such material policies are in full force and
effect, all premiums with respect thereto have been paid in
accordance with their respective terms, and no notice of
cancellation or termination has been received with respect to any
such policy. </p>

<p><b>3.13 </b><font color="#0000FF"><b>Solvency</b></font><b>.</b>
Neither the Borrower nor any Subsidiary is an &quot;insolvent
person&quot; within the meaning of the <i>Bankruptcy and
Insolvency Act </i>(Canada), R.S.C. 1985, c.B-3 or within the
meaning of any corresponding legislation in the United States of
America.</p>

<p><b>3.14 </b><font color="#0000FF"><b>Employee Matters</b></font><b>.
</b>Each of the Borrower and its Subsidiaries has withheld from
each payment to each of their respective officers, directors and
employees the amount of all Taxes, including income tax, pension
plan, unemployment insurance and other payments and deductions
required to be withheld therefrom, and has paid the same to the
proper taxation or other receiving authority in accordance with
applicable Law. None of the Borrower nor any Subsidiary is
subject to any claim by or liability to any of their respective
officers, directors or employees for salary (including vacation
pay) or benefits which would rank in whole or in part <i>pari
passu</i> with or prior to the Liens created by the Security
Documents.</p>

<p><b>3.15 </b><font color="#0000FF"><b>Fiscal Year</b></font><b>.</b>
The Fiscal Year of the Borrower ends on December 31 of each
calendar year, and the Borrower&#146;s Fiscal Quarters end on the
last day of each of March, June, September and December of each
calendar year.</p>

<p><b>3.16 </b><font color="#0000FF"><b>Intellectual Property
Rights</b></font>. The Borrower and each Subsidiary is the
registered and beneficial owner of, with good and marketable
title, free of all licenses, franchises and Liens to all patents,
patent applications, trade marks, trade mark applications, trade
names, service marks, copyrights, industrial designs, integrated
circuit topographies, or other rights with respect to the
foregoing and other similar property, used in or necessary for
the present and planned future conduct of its business, without
any conflict with the rights of any other Person, other than as
listed on Schedule&nbsp;F, or other than for such conflicts as
could not reasonably be expected to have a Material Adverse
Effect. Except as set forth in Schedule&nbsp;F, no material claim
has been asserted and is pending by any Person with respect to
the use by the Borrower or any Subsidiary of any intellectual
property or challenging or questioning the validity,
enforceability or effectiveness of any intellectual property
necessary for the conduct of the business of the Borrower or any
Subsidiary. Except as disclosed in Schedule&nbsp;F or except as
could not reasonably be expected to have a Material Adverse
Effect, (i)&nbsp;the Borrower and each Subsidiary has the
exclusive right to use the intellectual property which the
Borrower (or each Subsidiary) owns, (ii)&nbsp;all applications
and registrations for such intellectual property are current, and
(iii)&nbsp;to the knowledge of the Borrower, the conduct of the
Borrower&#146;s and each Subsidiary&#146;s business does not
infringe the intellectual property rights of any other Person.</p>

<p><b>3.17 </b><font color="#0000FF"><b>Indebtedness</b></font><b>.</b>
None of the Borrower, Viner International or Viner Finance has
any Indebtedness outstanding, other than Indebtedness in favour
of the Lender and its Affiliates, and other than Indebtedness
amongst themselves.</p>

<p align="center"><b>ARTICLE 4</b><font color="#0000FF"><b><br>
CONDITIONS</b></font></p>

<p><b>4.1 </b><font color="#0000FF"><b>Closing Conditions</b></font><b>.</b>
The obligations of the Lender to make Loans hereunder shall not
become effective until the date on which each of the following
conditions is satisfied (or waived in accordance with Section
8.2):</p>

<p>(a) <u>Credit Agreement</u>. The Lender (or its counsel) shall
have received from each party hereto either (i)&nbsp;a
counterpart of this Agreement signed on behalf of each party
hereto, or (ii)&nbsp;written evidence satisfactory to the Lender
(which may include facsimile transmission of a signed signature
page of this Agreement) that each such party has signed a
counterpart of this Agreement.</p>

<p>(b) <u>Legal Opinions</u>. The Lender shall have received
favourable written opinions (addressed to the Lender and dated
the Closing Date) of Borden Ladner Gervais LLP and Skadden, Arps,
Slate, Meagher &amp; Flom LLP, counsel to the Borrower, covering
such matters relating to the Borrower, this Agreement, the other
Financing Documents, or the Transactions as the Lender shall
reasonably request (together with copies of all factual
certificates and legal opinions delivered to such counsel in
connection with such opinions upon which counsel has relied). </p>

<p>(c) <u>Corporate Certificates</u>. The Lender shall have
received:</p>

<blockquote>
    <blockquote>
        <blockquote>
            <blockquote>
                <blockquote>
                    <blockquote>
                        <p>(i) certified copies of the
                        resolutions of the Board of Directors of
                        the Borrower, and any Subsidiary which is
                        a party to any Financing Document, dated
                        as of the Closing Date, and approving, as
                        appropriate, the Loans, this Agreement
                        and the other Financing Documents, and
                        all other documents, if any, to which the
                        Borrower or such Subsidiary is a party
                        and evidencing corporate authorization
                        with respect to such documents; and</p>
                        <p>(ii) a certificate of the Secretary or
                        an Assistant Secretary of the Borrower,
                        and any Subsidiary which is a party to
                        any Financing Document, dated as of the
                        Closing Date, and certifying (A)&nbsp;the
                        name, title and true signature of each
                        officer of such Person authorized to
                        execute this Agreement and the other
                        Financing Documents to which it is a
                        party, (B)&nbsp;the name, title and true
                        signature of each officer of such Person
                        authorized to provide the certifications
                        required pursuant to this Agreement, and
                        (C)&nbsp;that attached thereto is a true
                        and complete copy of the articles of
                        incorporation and bylaws of the Borrower,
                        and any Subsidiary which is a party to
                        any Financing Document, as amended to
                        date, and a recent certificate of status,
                        certificate of compliance, good standing
                        certificate or analogous certificate.</p>
                    </blockquote>
                </blockquote>
            </blockquote>
        </blockquote>
    </blockquote>
</blockquote>

<p>(d) <u>Closing Conditions Certificate.</u> The Lender shall
have received a certificate, dated the Closing Date and signed by
a Responsible Officer of the Borrower, confirming compliance with
the financial covenants set forth in Section 5.12 and with the
conditions set forth in Section 4.2(a) and (b).</p>

<p>(e) <u>Fees</u>. The Lender shall have received all fees and
other amounts due and payable on or prior to the Closing Date,
including, to the extent invoiced, reimbursement or payment of
all legal fees and other out-of-pocket expenses required to be
reimbursed or paid by the Borrower hereunder or under any other
Financing Document.</p>

<p>(f) <u>Execution and Delivery of Documentation</u>. The
Borrower and any Subsidiary which is a party to any Financing
Document shall have duly authorized, executed and delivered all
documents required hereunder, all in form and substance
satisfactory to the Lender, acting reasonably, and all of the
Security Documents shall have been registered in all offices in
which, in the opinion of the Lender or its counsel, registration
is necessary or of advantage to preserve the priority of the
Liens intended to be created thereby, and duplicate copies of
such Security Documents bearing or accompanied by appropriate
endorsements or certificates of registration shall have been
delivered to the Lender. The Lender shall have received and be
satisfied with the results of all personal property, pending
litigation, judgment, bankruptcy, bulk sale, execution and other
searches conducted by the Lender and its counsel with respect to
the Borrower and any Subsidiary in all jurisdictions selected by
the Lender and its counsel.</p>

<p>(g) <u>Security Documents</u>. The Lender shall have received:</p>

<blockquote>
    <blockquote>
        <blockquote>
            <blockquote>
                <blockquote>
                    <blockquote>
                        <p>(i) a guarantee executed by each of
                        Viner International and Viner Finance in
                        favour of the Lender dated as of the
                        Closing Date; </p>
                        <p>(ii) a securities pledge agreement
                        executed by the Borrower, in favour of
                        the Lender dated as of the Closing Date,
                        with respect to all shares in the capital
                        of Viner International, together with all
                        stock certificates, instruments and other
                        documents required to be delivered to the
                        Lender pursuant to such securities pledge
                        agreement;</p>
                        <p>(iii) a securities pledge agreement
                        executed by the Borrower, in favour of
                        the Lender dated as of the Closing Date,
                        with respect to all shares in the capital
                        of Fahnestock Canada, together with all
                        stock certificates, instruments and other
                        documents required to be delivered to the
                        Lender pursuant to such securities pledge
                        agreement;</p>
                        <p>(iv) a securities pledge agreement
                        executed by Viner International, in
                        favour of the Lender dated as of the
                        Closing Date, with respect to all shares
                        in the capital of Viner Finance, together
                        with all stock certificates, instruments
                        and other documents required to be
                        delivered to the Lender pursuant to such
                        securities pledge agreement; and</p>
                        <p>(v) a securities pledge agreement
                        executed by Viner Finance, in favour of
                        the Lender dated as of the Closing Date,
                        with respect to all shares in the capital
                        of Fahnestock &amp; Co., together with
                        all stock certificates, instruments and
                        other documents required to be delivered
                        to the Lender pursuant to such securities
                        pledge agreement.</p>
                        <p>All of the above Security Documents
                        shall be in form and substance
                        satisfactory to the Lender.</p>
                    </blockquote>
                </blockquote>
            </blockquote>
        </blockquote>
    </blockquote>
</blockquote>

<p>(h) <u>Regulatory Approval; Consents; Waivers</u>. The Lender
shall be satisfied, acting reasonably, that all material
Authorizations required in connection with the Transactions
contemplated hereby have been obtained and are in full force and
effect (including all approvals listed in Schedule&nbsp;B), and
that all consents and waivers required to consummate the
Transactions have been obtained.</p>

<p>(i) <u>Delivery of Financial Statements</u>. The Lender shall
have received (i)&nbsp;the audited consolidated balance sheets,
statements of income and retained earnings and statements of
changes in financial position of the Borrower for the Fiscal Year
ended December 31, 2001, and (ii)&nbsp;corresponding unaudited
financial statements in respect of the Borrower and in respect of
Fahnestock &amp; Co. for the 9 month period ended September 30,
2002.</p>

<p>(j) <u>Other Documentation</u>. The Lender shall have received
such other documents and instruments as are customary for
transactions of this type or as they may reasonably request.</p>

<p><b>4.2 </b><font color="#0000FF"><b>Each Credit Event</b></font><b>.</b>
The obligation of the Lender to make a Loan on the occasion of
any Borrowing is subject to the satisfaction of the following
conditions:</p>

<p>(a) the representations and warranties of the Borrower set
forth in this Agreement shall be true and correct on and as of
the date of each such Borrowing (except where such representation
or warranty refers to a different date);</p>

<p>(b) at the time of and immediately after giving effect to such
Borrowing no Default shall have occurred and be continuing; and</p>

<p>(c) the Lender shall have received a Borrowing Request in the
manner and within the time period required by Section 2.2.</p>

<p>Each Borrowing shall be deemed to constitute a representation
and warranty by the Borrower on the date thereof as to the
accuracy of the matters specified in paragraphs (a) and (b)
above.</p>

<p align="center"><b>ARTICLE 5</b><font color="#0000FF"><b><br>
AFFIRMATIVE COVENANTS</b></font></p>

<p>From (and including) the Closing Date until the Commitment has
expired or been terminated and the principal of and interest on
each Loan and all fees payable hereunder shall have been paid in
full the Borrower covenants and agrees with the Lender that:</p>

<p><b>5.1 </b><font color="#0000FF"><b>Financial Statements and
Other Information</b></font><b>.</b> The Borrower will furnish to
the Lender:</p>

<p>(a) as soon as available and in any event within 90 days after
the end of each Fiscal Year of the Borrower, its audited
consolidated balance sheet and related statements of income,
retained earnings and changes in financial position as of the end
of and for such Fiscal Year, setting forth in each case in
comparative form the figures for the previous Fiscal Year, all
reported on by PricewaterhouseCoopers or other independent
auditors of recognized national standing (without a &quot;going
concern&quot; or like qualification or exception and without any
qualification or exception as to the scope of such audit) to the
effect that such consolidated financial statements present fairly
in all material respects the financial condition and results of
operations of the Borrower and its Subsidiaries on a consolidated
basis in accordance with GAAP consistently applied;</p>

<p>(b) as soon as available and in any event within 45 days after
the end of each of the first three Fiscal Quarters of each Fiscal
Year of the Borrower, its unaudited consolidated balance sheet
and related statements of income, retained earnings and changes
in financial position as of the end of and for such Fiscal
Quarter and the then elapsed portion of the Fiscal Year which
includes such Fiscal Quarter, setting forth in each case in
comparative form the figures for the corresponding period or
periods of (or, in the case of the balance sheet, as of the end
of) the previous Fiscal Year, all certified by a Responsible
Officer as presenting fairly in all material respects the
financial condition and results of operations of the Borrower and
its Subsidiaries on a consolidated basis in accordance with GAAP
consistently applied, subject to normal year-end audit
adjustments;</p>

<p>(c) as soon as available and in any event within 45 days after
the end of each month, a certificate of the Borrower, signed by a
Responsible Officer, detailing the status of Employee Notes,
including the outstanding amount owed by each employee, and the
change in such outstanding amounts relative to the prior
month-end;</p>

<p>(d) concurrently with the financial statements required
pursuant to Sections 5.1(a) and (b) above, a certificate of the
Borrower with respect to the Companies, substantially in the form
of Exhibit&nbsp;B, signed by a Responsible Officer
(i)&nbsp;stating that a review of such financial statements
during the period covered thereby and of the activities of the
Borrower and the other Companies has been made under such
Responsible Officer&#146;s supervision with a view to determining
whether the Borrower and the other Companies have fulfilled all
of their obligations under this Agreement and the other Financing
Documents, (ii)&nbsp;stating that the Borrower and the other
Companies have fulfilled their obligations under this Agreement
and the other Financing Documents and that all representations
made in this Agreement continue to be true and correct as if made
on the date of such certification (or specifying the nature of
any change), except where such representation or warranty refers
to a different date, or, if there shall be a Default or Event of
Default, specifying the nature and status thereof and the
Borrower&#146;s proposed response thereto,
(iii)&nbsp;demonstrating in reasonable detail compliance
(including showing all material calculations) as at the end of
the most recently completed Fiscal Year or the most recently
completed Fiscal Quarter, with the financial covenants in Section
5.12, and (iv)&nbsp;containing or accompanied by such financial
or other details, information and material as the Lender may
reasonably request to evidence such compliance;</p>

<p>(e) concurrently with any delivery of financial statements
under Section 5.l(a) above, a certificate of the accounting firm
that reported on such financial statements stating whether that
firm obtained knowledge during the course of its examination of
such financial statements of any Default (which certificate may
be limited in form, scope and substance to the extent required by
applicable accounting rules or guidelines in effect from time to
time);</p>

<p>(f) promptly after the same become publicly available, copies
of all periodic and other reports, proxy statements and other
materials filed by the Borrower with any securities commission,
stock exchange or similar entity, and all materials distributed
out of the ordinary course by the Borrower to its shareholders
and which relate to matters in which the Lender can reasonably be
expected to have an interest, and copies, when filed, by
Fahnestock &amp; Co. of Focus Reports filed with the U.S.
Securities Exchange Commission;</p>

<p>(g) promptly after the Borrower learns of the receipt or
occurrence of any of the following, a certificate of the
Borrower, signed by a Responsible Officer, specifying
(i)&nbsp;any official notice of any violation, possible
violation, non-compliance or possible non-compliance, or claim
made by any Governmental Authority pertaining to all or any part
of the properties of the Borrower or any of the Subsidiaries
which could reasonably be expected to have a Material Adverse
Effect, (ii)&nbsp;any event which constitutes a Default or Event
of Default, together with a detailed statement specifying the
nature thereof and the steps being taken to cure such Default or
Event of Default, (iii)&nbsp;the receipt of any notice from, or
the taking of any other action by, the holder of any promissory
note, debenture or other evidence of Indebtedness of the Borrower
or any of the Subsidiaries in an amount in excess of
U.S.$1,000,000 with respect to an actual or alleged default,
together with a detailed statement specifying the notice given or
other action taken by such holder and the nature of the claimed
default and what action the Borrower or the relevant Subsidiary
is taking or proposes to take with respect thereto, (iv)&nbsp;any
default or non-compliance of any party to any of the Financing
Documents with any of the terms and conditions thereof or any
notice of termination or other proceedings or actions which could
reasonably be expected to adversely affect any of the Financing
Documents, (v)&nbsp;the creation, dissolution, merger or
acquisition of any Subsidiary, and (vi)&nbsp;any event,
development or condition which may reasonably be expected to have
a Material Adverse Effect;</p>

<p>(h) promptly after the occurrence thereof, notice of the
institution of or any material adverse development in any action,
suit or proceeding or any governmental investigation or any
arbitration before any court or arbitrator or any Governmental
Authority or official against the Borrower or any Subsidiary or
any material property of any thereof which could reasonably be
expected to have a Material Adverse Effect;</p>

<p>(i) upon request by the Lender, a summary of the insurance
coverages of the Borrower and the Subsidiaries, in form and
substance reasonably satisfactory to the Lender, and upon renewal
of any insurance policy, a copy of an insurance certificate
summarizing the terms of such policy, and upon request by the
Lender, copies of the applicable policies;</p>

<p>(j) concurrently with any delivery of financial statements
under Section 5.1(a) or (b) above, a certificate of a Responsible
Officer of the Borrower&nbsp;stating whether any change in GAAP
or in the application thereof has occurred since the date of the
audited financial statements referred to in this Section 5.1 and,
if any such change has occurred, specifying the effect of such
change on the financial statements accompanying such certificate;
and</p>

<p>(k) such other reports and information which the Lender may
reasonably request from time to time.</p>

<p><b>5.2 </b><font color="#0000FF"><b>Existence; Conduct of
Business</b></font><b>.</b> The Borrower will, and will cause
each of the other Companies to, do or cause to be done all things
necessary to preserve, renew and keep in full force and effect
their legal existence and, except to the extent that the failure
to do so could not reasonably be expected to result in a Material
Adverse Effect, obtain, preserve, renew and keep in full force
and effect any and all rights, licenses, permits, privileges and
franchises material to the conduct of their businesses.</p>

<p><b>5.3 </b><font color="#0000FF"><b>Payment of Obligations</b></font><b>.
</b>The Borrower will, and will cause each Subsidiary to, pay its
obligations, including Tax liabilities, that, if not paid, could
result in a Material Adverse Effect before the same shall become
delinquent or in default, except where (a)&nbsp;the validity or
amount thereof is being contested in good faith by appropriate
proceedings, (b)&nbsp;the Borrower or such Subsidiary has set
aside on its books adequate reserves with respect thereto in
accordance with GAAP, and (c)&nbsp;the failure to make payment
pending such contest could not reasonably be expected to result
in a Material Adverse Effect.</p>

<p><b>5.4 </b><font color="#0000FF"><b>Maintenance of Properties</b></font><b>.</b>
The Borrower will, and will cause each of the Subsidiaries to,
keep and maintain all property material to the conduct of its
business in good working order and condition, ordinary wear and
tear excepted, except to the extent that the failure to do so
could not reasonably be expected to have a Material Adverse
Effect.</p>

<p><b>5.5 </b><font color="#0000FF"><b>Books and Records;
Inspection Rights</b></font><b>.</b> The Borrower will, and will
cause each of the Subsidiaries to, keep proper books of record
and account in which full, true and correct entries are made of
all dealings and transactions in relation to its business and
activities. The Borrower will, and will cause each Subsidiary to,
permit any representatives designated by the Lender, upon
reasonable prior notice, to visit and inspect its properties, to
examine and make extracts from its books and records, and to
discuss its affairs, finances and condition with its officers and
independent accountants, all at such reasonable times and as
often as reasonably requested.</p>

<p><b>5.6 </b><font color="#0000FF"><b>Compliance with Laws and
Contracts</b></font><b>.</b> The Borrower will, and will cause
each Subsidiary to, comply with all Laws and orders of any
Governmental Authority applicable to it or its property and with
all of its material contractual obligations, including all
regulatory orders made by any Governmental Authority, except
where the failure to do so, individually or in the aggregate,
could not reasonably be expected to result in a Material Adverse
Effect.</p>

<p><b>5.7 </b><font color="#0000FF"><b>Use of Proceeds</b></font><b>.</b>
The proceeds of the Loans will be used solely (i) to make
Permitted Distributions by the Borrower, (ii) to be lent
directly, or indirectly through Viner International and/or Viner
Finance, to Fahnestock &amp; Co., to finance loans to be made to
employees of Fahnestock &amp; Co. to be evidenced by Employee
Notes, (iii) to make payments of interest, principal and other
amounts required hereunder, and (iv) to make incidental payments
for the normal ongoing operating costs of the Borrower.<b> </b></p>

<p><b>5.8 </b><font color="#0000FF"><b>Further Assurances</b></font><b>.</b>
The Borrower will, and will cause the other Companies to, cure
promptly any defects in the execution and delivery of the
Financing Documents, including this Agreement. Upon request, the
Borrower will, at its expense, as promptly as practical, execute
and deliver to the Lender, all such other and further documents,
agreements and instruments (and cause each Subsidiary to take
such action) in compliance with or performance of the covenants
and agreements of the Borrower or any Subsidiary in any of the
Financing Documents, including this Agreement, or to further
evidence and more fully describe the Collateral, or to correct
any omissions in any of the Financing Documents, or more fully to
state the security obligations set out herein or in any of the
Financing Documents, or to perfect, protect or preserve any Liens
created pursuant to any of the Financing Documents, or to make
any recordings, to file any notices, or obtain any consents, all
as may be necessary or appropriate in connection therewith. </p>

<p><b>5.9 </b><font color="#0000FF"><b>Insurance</b></font><b>.</b>
The Borrower will, and will cause each Subsidiary to, maintain or
cause to be maintained, with financially sound and reputable
insurers, insurance with respect to their respective properties
and business against such liabilities, casualties, risks and
contingencies and in such types (including business interruption
insurance) and amounts as is customary in the case of Persons
engaged in the same or similar businesses and similarly situated
and in accordance with any requirement of any Governmental
Authority. </p>

<p><b>5.10 </b><font color="#0000FF"><b>Operation and Maintenance
of Property</b></font><b>.</b> The Borrower will, and will cause
each Subsidiary to, manage and operate its business or cause its
business to be managed and operated (i)&nbsp;in accordance with
prudent industry practice in all material respects and in
compliance in all material respects with the terms and provisions
of all applicable licenses, leases, contracts and agreements, and
(ii)&nbsp;in compliance with all applicable laws of the
jurisdiction in which such businesses are carried on, and all
applicable Laws of every other Governmental Authority from time
to time constituted to regulate the ownership, management and
operation of such businesses, except where a failure to so manage
and operate would not have a Material Adverse </p>

<p><b>5.11 </b><font color="#0000FF"><b>Maintain Listings on NYSE
and TSX. </b></font>The Borrower will use reasonable efforts to
maintain the listing of its Class A non-voting shares on the New
York Stock Exchange and the Toronto Stock Exchange.</p>

<p><b>5.12 </b><font color="#0000FF"><b>Financial Covenants</b></font><b>.</b>
</p>

<p>(a) <u>Borrower&#146;s Liabilities to Equity Ratio</u>. The
Borrower will at all times maintain a Liabilities to Equity Ratio
at or below 4:1, and for the purposes of this calculation, the
liabilities of Fahnestock &amp; Co. excludes secured liabilities.</p>

<p>(b) <u>Fahnestock &amp; Co.&#146;s Liabilities to Equity Ratio</u>.
The Borrower will cause Fahnestock &amp; Co. to at all times
maintain a Liabilities to Equity Ratio at or below 3.5:1.</p>

<p>(c) <u>Fahnestock &amp; Co.&#146;s Minimum Excess Net Capital.</u>
The Borrower will cause Fahnestock &amp; Co. to at all times
maintain Excess Net Capital of not less than U.S.$100,000,000.</p>

<p><b>5.13 </b><font color="#0000FF"><b>Distributions.</b></font>
The Borrower will cause:</p>

<p>(c) Viner Finance to pay to Viner International all amounts
received by Viner Finance on account of the shares of Fahnestock
&amp; Co. held by Viner Finance upon receipt thereof other than
(i)&nbsp;such amounts as are required by Viner Finance to pay
administrative expenses incurred in the ordinary course of
business, (ii)&nbsp;such amounts as are required for Viner
Finance to make payments then due or to become due in the next 30
days in respect of the zero coupon promissory note to be issued
by Viner Finance to the Lender (or an Affiliate of the Lender),
as contemplated by the Asset Purchase Agreement, and
(iii)&nbsp;such amounts as are required for Viner Finance to make
payments on intercorporate debt owing by it to Viner
International or to the Borrower from time to time; and</p>

<p>(b) Viner International to pay to the Borrower all amounts
received by Viner International on account of the shares of Viner
Finance held by Viner International upon receipt of such proceeds
other than (i)&nbsp;such amounts as are required by Viner
International to pay administrative expenses incurred in the
ordinary course of business, (ii)&nbsp;such amounts as are
required for Viner International to pay amounts due or accruing
due on the Debentures (as such term is defined in the Asset
Purchase Agreement) issued by Viner International to the Lender
(or an Affiliate of the Lender), and (iii)&nbsp;such amounts as
are required for Viner International to make payments on
intercorporate debt owing by it to the Borrower from time to
time.</p>

<p align="center"><b>ARTICLE 6</b><font color="#0000FF"><b><br>
NEGATIVE COVENANTS</b></font></p>

<p>From (and including) the Closing Date until the Commitment has
expired or been terminated and the principal of and interest on
each Loan and all fees payable hereunder shall have been paid in
full, the Borrower covenants and agrees with the Lender that:</p>

<p><b>6.1 </b><font color="#0000FF"><b>Indebtedness</b></font><b>.</b>
The Borrower will not, and will not permit Viner International or
Viner Finance to, create, incur, assume or permit to exist any
Indebtedness without the prior written consent of the Lender,
except:</p>

<p>(a) any Indebtedness created hereunder;</p>

<p>(b) any Indebtedness existing on the date hereof and set forth
in Schedule&nbsp;G, but not any extensions, renewals or
replacements of any such Indebtedness; and</p>

<p>(c) any Indebtedness owing by Viner International to the
Borrower or by Viner Finance to Viner International or the
Borrower.</p>

<p><b>6.2 </b><font color="#0000FF"><b>Liens</b></font><b>.</b> </p>

<p>(a) The Borrower will not, and will not permit Viner
International or Viner Finance to create, incur, assume or permit
to exist any Lien on any property or asset now owned or hereafter
acquired by any of them except in Permitted Liens.</p>

<p>(b) The Borrower will not permit Fahnestock &amp; Co. to
create Liens, other than (i) in Permitted Liens, and (ii) Liens
created in the ordinary course of its business, subject to
Section 6.3. </p>

<p><b>6.3 </b><font color="#0000FF"><b>Employee Notes</b></font>.
The Borrower will not permit Fahnestock &amp; Co. to sell, assign
or otherwise encumber the Employee Notes. </p>

<p><b>6.4 </b><font color="#0000FF"><b>Fundamental Changes</b></font><b>.</b></p>

<p>(a) Each of the Companies will not merge into or amalgamate or
consolidate with any other Person, or permit any other Person to
merge into or amalgamate or consolidate with it, or sell,
transfer, lease or otherwise dispose of (in one transaction or in
a series of transactions) all or substantially all of its assets.</p>

<p>(b) The Borrower&#146;s business shall be restricted to
holding all of the issued and outstanding Equity Securities of
Viner International and Fahnestock Canada, and the Borrower shall
continue to hold all of the outstanding Equity Securities of
Viner International and Fahnestock Canada.</p>

<p>(c) Viner International&#146;s business shall be restricted to
holding all of the issued and outstanding Equity Securities of
Viner Finance, and Viner International shall continue to hold all
of the outstanding Equity Securities of Viner Finance.</p>

<p>(d) Viner Finance&#146;s business shall be restricted to
holding all of the issued and outstanding Equity Securities of
Fahnestock &amp; Co., and Viner Finance shall continue to hold
all of the outstanding Equity Securities of Fahnestock &amp; Co.</p>

<p><b>6.5 </b><font color="#0000FF"><b>Restricted Payments</b></font><b>.</b>
The Borrower will not declare, pay or make, or agree to pay or
make, directly or indirectly, any Restricted Payment, provided
that the Borrower may make Permitted Distributions.</p>

<p><b>6.6 </b><font color="#0000FF"><b>Transactions with
Affiliates</b></font><b>.</b> The Borrower will not, and will not
permit any Subsidiary to, sell, lease or otherwise transfer any
property or assets to, or purchase, lease or otherwise acquire
any property or assets from, or otherwise engage in any other
transactions (other than intercorporate loans permitted by
Section 3.17) with, any of its Affiliates, except in the ordinary
course of business at prices and on terms and conditions not less
favourable to the Borrower or such Subsidiary than could be
obtained on an arm&#146;s-length basis from unrelated third
parties.</p>

<p><b>6.7 </b><font color="#0000FF"><b>Issuance of Shares</b></font><b>.</b>
The Companies, other than the Borrower, will not authorize or
issue&nbsp;any preferred shares or other Equity Securities unless
such securities are pledged, directly or indirectly, to the
Lender.</p>

<p align="center"><b>ARTICLE 7</b><font color="#0000FF"><b><br>
EVENTS OF DEFAULT</b></font></p>

<p><b>7.1 </b><font color="#0000FF"><b>Events of Default</b></font><b>.</b>
If any of the following events (&quot;<u>Events of Default</u>&quot;)
shall occur:</p>

<p>(a) the Borrower shall fail to pay any principal of any Loan
when and as the same shall become due and payable, whether at the
due date thereof or at a date fixed for prepayment thereof or
otherwise and such failure shall continue unremedied for a period
of two Business Days;</p>

<p>(b) the Borrower shall fail to pay any interest on any Loan or
any fee or any other amount (other than an amount referred to in
clause (a) above) payable under this Agreement, when and as the
same shall become due and payable and such failure shall continue
unremedied for a period of ten Business Days;</p>

<p>(c) any representation or warranty made or deemed made by or
on behalf of the Borrower or any Subsidiary in or in connection
with any Financing Document or any amendment or modification
thereof or waiver thereunder, or in any report, certificate,
financial statement or other document furnished pursuant to or in
connection with any Financing Document or any amendment or
modification thereof or waiver thereunder, shall prove to have
been incorrect in any material respect when made or deemed to be
made;</p>

<p>(d) the Borrower shall fail to observe or perform any
covenant, condition or agreement contained in Section 5.1(i),
Section 5.2 (with respect to the Borrower&#146;s existence) or
Section 5.7, or in Article 6 (or in any comparable provision of
any other Financing Document);</p>

<p>(e) the Borrower shall fail to observe or perform any
covenant, condition or agreement contained in this Agreement
(other than those specified in clauses (a), (b) or (d) above) or
any other Financing Document, and such failure shall continue
unremedied for a period of 30&nbsp;days after notice thereof from
the Lender to the Borrower;</p>

<p>(f) the Borrower or any Subsidiary:</p>

<blockquote>
    <blockquote>
        <blockquote>
            <blockquote>
                <blockquote>
                    <blockquote>
                        <p>(i) becomes insolvent, or generally
                        does not or becomes unable to pay its
                        debts or meet its liabilities as the same
                        become due, or admits in writing its
                        inability to pay its debts generally, or
                        declares any general moratorium on its
                        indebtedness, or proposes a compromise or
                        arrangement between it and any class of
                        its creditors;</p>
                        <p>(ii) commits an act of bankruptcy
                        under the <i>Bankruptcy and Insolvency
                        Act </i>(Canada), or makes an assignment
                        of its property for the general benefit
                        of its creditors under such Act, or makes
                        a proposal (or files a notice of its
                        intention to do so) under such Act;</p>
                        <p>(iii) institutes any proceeding
                        seeking to adjudicate it an insolvent, or
                        seeking liquidation, dissolution,
                        winding-up, reorganization, compromise,
                        arrangement, adjustment, protection,
                        moratorium, relief, stay of proceedings
                        of creditors generally (or any class of
                        creditors), or composition of it or its
                        debts or any other relief, under any
                        federal, provincial or foreign Law now or
                        hereafter in effect relating to
                        bankruptcy, winding-up, insolvency,
                        reorganization, receivership, plans of
                        arrangement or relief or protection of
                        debtors (including the <i>Bankruptcy and
                        Insolvency Act</i> (Canada), the <i>Companies&#146;
                        Creditors Arrangement Act</i> (Canada)
                        and any applicable corporations
                        legislation) or at common law or in
                        equity, or files an answer admitting the
                        material allegations of a petition filed
                        against it in any such proceeding;</p>
                        <p>(iv) applies for the appointment of,
                        or the taking of possession by, a
                        receiver, interim receiver,
                        receiver/manager, sequestrator,
                        conservator, custodian, administrator,
                        trustee, liquidator or other similar
                        official for it or any substantial part
                        of its property; or</p>
                        <p>(v) threatens to do any of the
                        foregoing, or takes any action, corporate
                        or otherwise, to approve, effect, consent
                        to or authorize any of the actions
                        described in this Section 7.1(f) or in
                        Section 7.1(g) or otherwise acts in
                        furtherance thereof or fails to act in a
                        timely and appropriate manner in defense
                        thereof,</p>
                    </blockquote>
                </blockquote>
            </blockquote>
        </blockquote>
    </blockquote>
</blockquote>

<p>(g) any petition is filed, application made or other
proceeding instituted against or in respect of the Borrower or
any Subsidiary:</p>

<blockquote>
    <blockquote>
        <blockquote>
            <blockquote>
                <blockquote>
                    <blockquote>
                        <p>(i) seeking to adjudicate it an
                        insolvent;</p>
                        <p>(ii) seeking a receiving order against
                        it under the <i>Bankruptcy and Insolvency
                        Act</i> (Canada);</p>
                        <p>(iii) seeking liquidation,
                        dissolution, winding-up, reorganization,
                        compromise, arrangement, adjustment,
                        protection, moratorium, relief, stay of
                        proceedings of creditors generally (or
                        any class of creditors), or composition
                        of it or its debts or any other relief
                        under any federal, provincial or foreign
                        Law now or hereafter in effect relating
                        to bankruptcy, winding-up, insolvency,
                        reorganization, receivership, plans of
                        arrangement or relief or protection of
                        debtors (including the <i>Bankruptcy and
                        Insolvency Act</i> (Canada), the <i>Companies&#146;
                        Creditors Arrangement Act</i> (Canada)
                        and any applicable corporations
                        legislation) or at common law or in
                        equity; or</p>
                        <p>(iv) seeking the entry of an order for
                        relief or the appointment of, or the
                        taking of possession by, a receiver,
                        interim receiver, receiver/manager,
                        sequestrator, conservator, custodian,
                        administrator, trustee, liquidator or
                        other similar official for it or any
                        substantial part of its property;</p>
                    </blockquote>
                </blockquote>
            </blockquote>
        </blockquote>
    </blockquote>
</blockquote>

<p>and such petition, application or proceeding continues
undismissed, or unstayed and in effect, for a period of
30&nbsp;days after the institution thereof, <u>provided</u> that
if an order, decree or judgment is granted or entered (whether or
not entered or subject to appeal) against the Borrower or any
Subsidiary thereunder in the interim, such grace period will
cease to apply, and <u>provided</u> <u>further</u> that if the
Borrower or any Subsidiary files an answer admitting the material
allegations of a petition filed against it in any such
proceeding, such grace period will cease to apply;</p>

<p>(h) any other event occurs which, under the Laws of any
applicable jurisdiction, has an effect equivalent to any of the
events referred to in either of Sections 7.1(f) or (g);</p>

<p>(i) one or more judgments for the payment of money in a
cumulative amount in excess of U.S.$1,000,000 (or its then
equivalent in any other currency) in the aggregate is rendered
against the Borrower, any Subsidiary or any combination thereof
and the Borrower or Subsidiary has not (i)&nbsp;provided for its
discharge in accordance with its terms within 30&nbsp;days from
the date of entry thereof, or (ii)&nbsp;procured a stay of
execution thereof within 30&nbsp;days from the date of entry
thereof and within such period, or such longer period during
which execution of such judgment has not been stayed, appealed
such judgment and caused the execution thereof to be stayed
during such appeal, <u>provided</u> that if enforcement and/or
realization proceedings are lawfully commenced in respect thereof
in the interim, such grace period will cease to apply;</p>

<p>(j) any property of the Borrower or any Subsidiary having a
fair market value in excess of U.S.$1,000,000 (or its then
equivalent in any other currency) in the aggregate is seized
(including by way of execution, attachment, garnishment, levy or
distraint), or any Lien thereon securing Indebtedness in excess
of U.S.$1,000,000 (or its then equivalent in any other currency)
is enforced, or such property has become subject to any charging
order or equitable execution of a Governmental Authority, or any
writ of execution or distress warrant exists in respect of the
Borrower, any Subsidiary or the property of any of them, or any
sheriff or other Person becomes lawfully entitled by operation of
law or otherwise to seize or distrain upon such property and in
any case such seizure, enforcement, execution, attachment,
garnishment, distraint, charging order or equitable execution, or
other seizure or right, continues in effect and is not released
or discharged for more than 30&nbsp;days or such longer period
during which entitlement to the use of such property continues
with the Borrower or Subsidiary, and the Borrower or such
Subsidiary is contesting the same in good faith and by
appropriate proceedings, <u>provided</u> that if the property is
removed from the use of the Borrower or Subsidiary, or is sold,
in the interim, such grace period will cease to apply;</p>

<p>(k) one or more final judgments, not involving the payment of
money and not otherwise specified in this Section 7.1(k), has
been rendered against the Borrower or any Subsidiary, the result
of which could reasonably be expected to result in a Material
Adverse Effect, so long as the Borrower or Subsidiary has not
(i)&nbsp;provided for its discharge in accordance with its terms
within 30&nbsp;days from the date of entry thereof, or
(ii)&nbsp;procured a stay of execution thereof within
30&nbsp;days from the date of entry thereof and within such
period, or such longer period during which execution of such
judgment has been stayed, appealed such judgment and caused the
execution thereof to be stayed during such appeal, <u>provided</u>
that if enforcement and/or realization proceedings are lawfully
commenced in respect thereof in the interim, such grace period
will cease to apply;</p>

<p>(l) this Agreement, any other Financing Document or any
material obligation or other provision hereof or thereof at any
time for any reason terminates or ceases to be in full force and
effect and a legally valid, binding and enforceable obligation of
the Borrower or any Subsidiary, is declared to be void or
voidable or is repudiated, or the validity, binding effect,
legality or enforceability hereof or thereof is at any time
contested by the Borrower or any Subsidiary, or the Borrower or
any Subsidiary denies that it has any or any further liability or
obligation hereunder or thereunder or any action or proceeding is
commenced to enjoin or restrain the performance or observance by
the Borrower or any Subsidiary of any material terms hereof or
thereof or to question the validity or enforceability hereof or
thereof, or at any time it is unlawful or impossible for the
Borrower or any Subsidiary to perform any of its material
obligations hereunder or thereunder; </p>

<p>(m) any Lien purported to be created by any Security Document
shall cease to be, or shall be asserted by the Borrower or any
Subsidiary not to be, a valid, perfected, first priority, except
to the extent that any such loss of perfection or priority
results from the failure of the Lender to maintain possession of
certificates representing securities pledged under the Financing
Documents or otherwise take any action within its control
(including the filing of financing change statements to renew any
financing statement filed under applicable personal property
security laws); and</p>

<p>(n) the Borrower shall fail to maintain the listing of its
Class A non-voting shares on both the New York Stock Exchange and
the Toronto Stock Exchange;</p>

<p>then, and in every such event (other than an event with
respect to the Borrower described in clause (f), (g) or (h)
above), and at any time thereafter during the continuance of such
event or any other such event, the Lender may by notice to the
Borrower, take either or both of the following actions, at the
same or different times: (i)&nbsp;terminate the Commitment, and
thereupon the Commitment shall terminate immediately, and
(ii)&nbsp;declare the Loans then outstanding to be due and
payable in whole (or in part, in which case any principal not so
declared to be due and payable may thereafter be declared to be
due and payable), and thereupon the principal of the Loans so
declared to be due and payable, together with accrued interest
thereon and all fees and other obligations of the Borrower
accrued hereunder, shall become due and payable immediately,
without presentment, demand, protest or other notice of any kind
except as set forth earlier in this paragraph, all of which are
hereby waived by the Borrower; and in the case of any event with
respect to the Borrower described in clause (f), (g) or (h)
above, the Commitment shall automatically terminate and the
principal of the Loans then outstanding, together with accrued
interest thereon and all fees and other obligations of the
Borrower accrued hereunder, shall automatically become due and
payable, without presentment, demand, protest or other notice of
any kind, all of which are hereby waived by the Borrower.</p>

<p><b>7.2 </b><font color="#0000FF"><b>Legal Proceedings</b></font>.
During the existence of an Event of Default, the Lender may
commence such legal action or other proceedings as it, in its
sole discretion, deems expedient to collect the Indebtedness of
the Borrower under the Loan Documents and to exercise its rights
under the Security Documents or any part thereof, all without any
additional notice, presentation, demand, or protest, all of which
the Borrower, to the extent permitted by law, hereby expressly
waives.</p>

<p align="center"><b>ARTICLE 8</b><font color="#0000FF"><b><br>
MISCELLANEOUS</b></font></p>

<p><b>8.1 </b><font color="#0000FF"><b>Notices</b></font><b>.</b>
Except in the case of notices and other communications expressly
permitted to be given by telephone, all notices and other
communications provided for herein shall be in writing and shall
be delivered by hand or overnight courier service, mailed by
certified or registered mail or sent by facsimile in each case to
the addressee, as follows:</p>

<p>(a) if to the Borrower:</p>

<p>Fahnestock Viner Holdings Inc.</p>

<p>P.O. Box 2015</p>

<p>20 Eglinton Avenue West &#150; Suite 1100</p>

<p>Toronto, ON M4R 1K8</p>

<p>Attention: E.K. Roberts</p>

<p>Facsimile: 416.322.7007</p>

<p>with a copy to:</p>

<p>Borden Ladner Gervais LLP</p>

<p>Scotia Plaza &#150; Suite 4400</p>

<p>40 King Street West</p>

<p>Toronto, ON M5H 3Y4</p>

<p>Attention: A. Winn Oughtred</p>

<p>Facsimile: 416.361.7076</p>

<p>(b) if to the Lender:</p>

<p>Canadian Imperial Bank of Commerce</p>

<p>Head Office &#150; Commerce Court West &#150; 6<sup>th</sup>
Floor</p>

<p>Toronto, ON M5L 1A2</p>

<p>Attention: Thomas W. Desson</p>

<blockquote>
    <blockquote>
        <p>Senior-Vice President, Credit Risk Management</p>
    </blockquote>
</blockquote>

<p>Facsimile: 416.980.8948</p>

<p>with a copy to each of: </p>

<p>Canadian Imperial Bank of Commerce</p>

<p>245 Park Avenue</p>

<p>New York, New York 10167</p>

<p>Attention: A. Molestina</p>

<p>U.S. Head of Legal, Legal and Compliance</p>

<p>Facsimile: 917.332.4320</p>

<p>and; </p>

<p>CIBC World Markets</p>

<p>BCE Place - 12<sup>th</sup> Floor</p>

<p>Toronto, ON M5J 2S8</p>

<p>Attention: David Clifford</p>

<p>Managing Director</p>

<p>Facsimile: 416.956.6828</p>

<p>Any party hereto may change its address or facsimile number
for notices and other communications hereunder by notice to the
other parties hereto. All notices and other communications given
to any party hereto in accordance with the provisions of this
Agreement shall be deemed to have been given on the date of
receipt.</p>

<p><b>8.2 </b><font color="#0000FF"><b>Waivers; Amendments</b></font><b>.</b></p>

<p>(a) No failure or delay by the Lender in exercising any right
or power hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right or power, or any
abandonment or discontinuance of steps to enforce such a right or
power, preclude any other or further exercise thereof or the
exercise of any other right or power. The rights and remedies of
the Lender hereunder are cumulative and are not exclusive of any
rights or remedies that they would otherwise have. No waiver of
any provision of this Agreement or consent to any departure by
the Borrower therefrom shall in any event be effective unless the
same shall be permitted by Section 8.2(b), and then such waiver
or consent shall be effective only in the specific instance and
for the purpose for which given. Without limiting the generality
of the foregoing, the making of a Loan shall not be construed as
a waiver of any Default, regardless of whether the Lender may
have had notice or knowledge of such Default at the time.</p>

<p>(b) Neither this Agreement nor any other Financing Document
(or any provision hereof or thereof) may be waived, amended or
modified except pursuant to an agreement or agreements in writing
entered into by the Borrower and the Lender.</p>

<p><b>8.3 </b><font color="#0000FF"><b>Expenses; Indemnity;
Damage Waiver</b></font><b>.</b></p>

<p>(a) The Borrower shall pay (i)&nbsp;all reasonable
out-of-pocket expenses incurred by the Lender, including the
reasonable fees, charges and disbursements of counsel for the
Lender and all applicable Taxes, in connection with the
preparation and administration of this Agreement and the other
Financing Documents, (ii)&nbsp;all reasonable out-of-pocket
expenses incurred by the Lender, including the reasonable fees,
charges and disbursements of counsel for the Lender and
applicable Taxes, in connection with any amendments,
modifications or waivers of the provisions hereof or of any of
the other Financing Documents, (whether or not the transactions
contemplated hereby or thereby shall be consummated), and
(iii)&nbsp;all out-of-pocket expenses incurred by the Lender,
including the fees, charges and disbursements of any counsel for
the Lender and all applicable Taxes, in connection with the
enforcement or protection of its rights in connection with this
Agreement, including its rights under this Section, or in
connection with the Loans made hereunder, including all such
out-of-pocket expenses incurred during any workout, restructuring
or negotiations in respect of such Loans.</p>

<p>(b) The Borrower shall indemnify the Lender, as well as each
Related Party of the Lender, (each such Person being called an
&quot;<u>Indemnitee</u>&quot;) against, and hold each Indemnitee
harmless from, any and all losses, claims, cost recovery actions,
damages, expenses and liabilities of whatsoever nature or kind
and all reasonable out-of-pocket expenses (including due
diligence expenses, travel expenses and reasonable fees, charges
and disbursements of counsel) and all applicable Taxes to which
any Indemnitee may become subject arising out of or in connection
with (i)&nbsp;the execution or delivery of the Financing
Documents or any agreement or instrument contemplated thereby,
the performance by the parties thereto of their respective
obligations thereunder, and the consummation of the Transactions
or any other transactions thereunder, (ii)&nbsp;any Loan or any
actual or proposed use of the proceeds therefrom, or
(iii)&nbsp;any other aspect of this Agreement and the other
Financing Documents; <u>provided</u> that such indemnity shall
not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities or related expenses are
determined by a court of competent jurisdiction by final and
non-appealable judgment to have resulted from the gross
negligence (it being acknowledged that ordinary negligence does
not necessarily constitute gross negligence) or wilful misconduct
of or material breach of this Agreement by such Indemnitee.</p>

<p>(c) The Borrower shall not assert, and hereby waives (to the
fullest extent permitted by applicable Law), any claim against
any Indemnitee, on any theory of liability, for special,
indirect, consequential or punitive damages (as opposed to direct
or actual damages) arising out of, in connection with, or as a
result of, any Financing Document, or any agreement or instrument
contemplated thereby, the Transactions, any Loan or the use of
the proceeds thereof.</p>

<p>(d) Any inspection of any property of the Borrower or any of
its Subsidiaries made by or through the Lender is for purposes of
administration of the Credit only, and neither the Borrower nor
any of its Subsidiaries is entitled to rely upon the same
(whether or not such inspections are at the expense of the
Borrower).</p>

<p>(e) By accepting or approving anything required to be
observed, performed, fulfilled or given to the Lender pursuant to
the Financing Documents, the Lender shall not be deemed to have
warranted or represented the sufficiency, legality, effectiveness
or legal effect of the same, or of any term, provision or
condition thereof, and such acceptance or approval thereof shall
not constitute a warranty or representation to anyone with
respect thereto by the Lender. </p>

<p>(f) The relationship between the Borrower and the Lender is,
and shall at all times remain, solely that of borrower and
lender. The Lender shall not under any circumstance be construed
to be a partner or joint venturer of the Borrower or its
Affiliates. The Lender does not undertake or assume any
responsibility or duty to the Borrower or its Affiliates to
select, review, inspect, supervise, pass judgment upon or inform
the Borrower or its Affiliates of any matter in connection with
their property or the operations of the Borrower or its
Affiliates. The Borrower and its Affiliates shall rely entirely
upon their own judgment with respect to such matters, and any
review, inspection, supervision, exercise of judgment or supply
of information undertaken or assumed by the Lender in connection
with such matters is solely for the protection of the Lender, and
neither the Borrower nor any other Person is entitled to rely
thereon.</p>

<p>(g) The Lender shall not be responsible or liable to any
Person for any loss, damage, liability or claim of any kind
relating to injury or death to Persons or damage to Property
caused by the actions, inaction or negligence of the Borrower or
any Subsidiary and/or their Affiliates and the Borrower hereby
indemnifies and holds the Lender and the Lender harmless on the
terms set forth in Section 8.3(b) from any such loss, damage,
liability or claim.</p>

<p>(h) This Agreement is made for the purpose of defining and
setting forth certain obligations, rights and duties of the
Borrower and the Lender in connection with the Loans, and is made
for the sole benefit of the Borrower and the Lender. Except as
provided in Sections 8.3(b) and 8.4, no other Person shall have
any rights of any nature hereunder or by reason hereof.</p>

<p>(i) All amounts due under this Section 8.3 shall be payable
not later than ten&nbsp;Business Days after written demand
therefor.</p>

<p><b>8.4 </b><font color="#0000FF"><b>Successors and Assigns</b></font><b>.</b></p>

<p>(a) The provisions of this Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective
successors and assigns permitted hereby, except that neither
party may assign or otherwise transfer any of its rights or
obligations hereunder without the prior written consent of the
other party (and any attempted assignment or transfer by either
party without such consent shall be null and void). Nothing in
this Agreement, expressed or implied, shall be construed to
confer upon any Person (other than the parties hereto, their
respective successors and assigns permitted hereby and, to the
extent expressly contemplated hereby, the Related Parties of the
Lender) any legal or equitable right, remedy or claim under or by
reason of this Agreement.</p>

<p><b>8.5 </b><font color="#0000FF"><b>Survival</b></font><b>.</b>
All covenants, agreements, representations and warranties made by
the Borrower herein and in the certificates or other instruments
delivered in connection with or pursuant to this Agreement shall
be considered to have been relied upon by the other parties
hereto and shall survive the execution and delivery of this
Agreement and the making of any Loans, regardless of any
investigation made by any such other party or on its behalf and
notwithstanding that the Lender may have had notice or knowledge
of any Default or incorrect representation or warranty at the
time any credit is extended hereunder, and shall continue in full
force and effect as long as the principal of or any accrued
interest on any Loan or any fee or any other amount payable under
this Agreement is outstanding and unpaid and so long as the
Commitment has not expired or terminated. Sections 2.9, 2.10,
2.11 and 8.3 shall survive and remain in full force and effect,
regardless of the consummation of the Transactions, the repayment
of the Loans, the expiration or termination of the Commitment or
the termination of this Agreement or any provision hereof.</p>

<p><b>8.6 </b><font color="#0000FF"><b>Counterparts; Integration;
Effectiveness</b></font><b>.</b> This Agreement may be executed
in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but
all of which when taken together shall constitute a single
contract. This Agreement and the other Financing Documents
constitute the entire contract among the parties relating to the
subject matter hereof and supersede any and all previous
agreements and understandings, oral or written, relating to the
subject matter hereof. This Agreement shall become effective when
it shall have been executed by the Lender and when the Lender
shall have received counterparts hereof which, when taken
together, bear the signatures of each of the other parties
hereto, and thereafter shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and
permitted assigns. Delivery of an executed original counterpart
of a signature page of this Agreement by facsimile shall be as
effective as delivery of a manually executed original counterpart
of this Agreement.</p>

<p><b>8.7 </b><font color="#0000FF"><b>Severability</b></font><b>.</b>
Any provision of this Agreement held to be invalid, illegal or
unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and
enforceability of the remaining provisions hereof, and the
invalidity of a particular provision in a particular jurisdiction
shall not invalidate such provision in any other jurisdiction.</p>

<p><b>8.8 </b><font color="#0000FF"><b>Right of Set Off</b></font><b>.</b>
If an Event of Default shall have occurred and be continuing, the
Lender and each of its Affiliates is hereby authorized at any
time and from time to time, to the fullest extent permitted by
Law, to set off and apply any and all deposits (general or
special, time or demand, provisional or final) at any time held
and other obligations at any time owing by the Lender or
Affiliate to or for the credit or the account of the Borrower
against any of and all of the obligations of the Borrower now or
hereafter existing under this Agreement held by the Lender,
irrespective of whether or not the Lender shall have made any
demand under this Agreement and although such obligations may be
unmatured. The rights of the Lender under this Section are in
addition to other rights and remedies (including other rights of
set off) which the Lender may have.</p>

<p><b>8.9 </b><font color="#0000FF"><b>Governing Law;
Jurisdiction; Consent to Service of Process</b></font><b>.</b></p>

<p>(a) This Agreement shall be construed in accordance with and
governed by the Laws of the Province of Ontario and the federal
laws of Canada applicable therein.</p>

<p>(b) The Borrower hereby irrevocably and unconditionally
submits, for itself and its property, to the non-exclusive
jurisdiction of the Courts of the Province of Ontario, and any
appellate court thereof, in any action or proceeding arising out
of or relating to this Agreement, or any other Financing Document
or for recognition or enforcement of any judgment, and each of
the parties hereto hereby irrevocably and unconditionally agrees
that all claims in respect of any such action or proceeding may
be heard and determined in Ontario. Each of the parties hereto
agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by Law.
Nothing in this Agreement shall affect any right that the Lender
may otherwise have to bring any action or proceeding relating to
this Agreement or any other Financing Document against the
Borrower or its properties in the courts of any other
jurisdiction.</p>

<p>(c) The Borrower hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do
so, any objection which it may now or hereafter have to the
laying of venue of any suit, action or proceeding arising out of
or relating to this Agreement in any court referred to in Section
8.9(b). Each of the parties hereto hereby irrevocably waives, to
the fullest extent permitted by Law, any <i>forum non conveniens</i>
defence to the maintenance of such action or proceeding in any
such court.</p>

<p>(d) Each party to this Agreement irrevocably consents to
service of process in the manner provided for notices in Section
8.1. Nothing in this Agreement will affect the right of any party
to this Agreement to serve process in any other manner permitted
by Law.</p>

<p><b>8.10 </b><font color="#0000FF"><b>WAIVER OF JURY TRIAL</b></font>.
EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN
ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT, ANY OTHER FINANCING DOCUMENT, OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON
CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO
(A)&nbsp;CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF
ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT
SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO
ENFORCE THE FOREGOING WAIVER AND (B)&nbsp;ACKNOWLEDGES THAT IT
AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS
AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.</p>

<p><b>8.11 </b><font color="#0000FF"><b>Headings</b></font><b>.</b>
Article and Section headings and the Table of Contents used
herein are for convenience of reference only, are not part of
this Agreement and shall not affect the construction of, or be
taken into consideration in interpreting, this Agreement.</p>

<p><b>8.12 </b><font color="#0000FF"><b>Confidentiality</b></font><b>.</b>
The Lender agrees to maintain the confidentiality of the
Information (as defined below), except that Information may be
disclosed (a)&nbsp;to each of its Affiliates, directors,
officers, employees, agents and advisors, including accountants,
legal counsel and other advisors (it being understood that the
Persons to whom such disclosure is made will be informed of the
confidential nature of such Information and instructed to keep
such Information confidential), (b)&nbsp;to the extent requested
by any regulatory authority or other Governmental Authority,
(c)&nbsp;to the extent required by applicable laws or regulations
or by any subpoena or similar legal process, (d)&nbsp;to any
other party to this Agreement, (e)&nbsp;in connection with the
exercise of any remedies under any Financing Document or any
suit, action or proceeding relating to any Financing Document or
the enforcement of rights thereunder, (f)&nbsp;subject to an
agreement containing provisions substantially the same as those
of this Section, to any actual or prospective assignee of any of
its rights or obligations under this Agreement, (g)&nbsp;with the
consent of the Borrower, or (h)&nbsp;to the extent such
Information (i)&nbsp;becomes publicly available other than as a
result of a breach of this Section, or (ii)&nbsp;becomes
available to the Lender on a non-confidential basis from a source
other than the Borrower. For the purposes of this Section, &quot;<u>Information</u>&quot;
means all information received from the Borrower relating to the
Borrower, any of its Subsidiaries, or their respective business,
other than any such information that is available to the Lender
on a non-confidential basis prior to disclosure by the Borrower; <u>provided</u>
that, in the case of information received from the Borrower after
the date hereof, such information is clearly identified as
confidential in writing at the time of delivery. Any Person
required to maintain the confidentiality of Information as
provided in this Section shall be considered to have complied
with its obligation to do so if such Person has exercised the
same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential
information.</p>

<p align="center"><b>[Balance of page intentionally left blank;
signature page follows.]</b></p>

<p align="center"><b></b>&nbsp;</p>

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

<table border="0" cellpadding="7" cellspacing="0" width="638">
    <tr>
        <td valign="top" width="42%">&nbsp;</td>
        <td valign="top" width="58%"><b>FAHNESTOCK VINER HOLDINGS
        INC.</b><p>By:<u> &quot;A.W.Oughtred&quot; </u></p>
        <p>A. Winn Oughtred</p>
        <p>Secretary</p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="42%">&nbsp;</td>
        <td valign="top" width="58%"><b>CANADIAN IMPERIAL BANK OF
        COMMERCE </b><p>By:<u> &quot;T.W. Desson&quot; </u></p>
        <p>Name: Thomas W. Desson</p>
        <p>Title: Senior Vice-President Credit Risk Management</p>
        <p>By:<u> </u></p>
        <p>Name:</p>
        <p>Title:</p>
        </td>
    </tr>
</table>
</body>
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</TEXT>
</DOCUMENT>
