TRANSACTION PROCESS MANAGEMENT COMMITTEE

The ACIC Transaction Process Management Committee (the "Committee") was originally formed to develop enhancement proposals for industry consideration which would serve to increase the efficiency of the private placement process. In January 1995 the Committee published its Private Placement Process Enhancements brochure which includes numerous enhancement recommendations for use in the documentation process of a private placement. In January 1996 the Committee published its Guide to Amendments brochure which sets forth recommended procedures and enhancements for the amendment process and includes numerous amendment forms for use by counsel in such process.

TERM SHEET CHECKLIST FOR UNSECURED DEBT TRANSACTIONS

The Committee believes that in addition to employing the enhancements set forth in the Enhancements brochure, increased attention to traditional private placement issues at the term sheet stage will significantly reduce the length of the documentation process and decrease the legal costs associated with the transaction. In this regard, the Committee has researched and prepared for industry use the following term sheet "checklist." The checklist is intended to be used by placement agents, investors and issuers prior to the finalization of the term sheet for a typical unsecured debt transaction. The questions presented below should serve as practical reminders of the issues typically confronted in such a private placement.

This checklist and the corresponding commentary is intended to be a guide for the review of term sheets for unsecured debt transactions. The checklist is divided into broad private placement "issue topics" and is designed to facilitate a dialogue among private placement professionals with respect to the formation of the term sheet and the business deal. The checklist is not exhaustive and does not attempt to suggest any particular structure, covenant package or format for any specific transaction. Its purpose is to assist the private placement professionals in improving the efficiency of issuing debt through a private placement.

All references in the checklist and the commentary to the Financial Covenant Reference Manual are noted as "FCRM" and all references to the Model Forms of Note Purchase Agreement prepared by the Private Placement Enhancement Project are noted as "Model Forms." The FCRM and the Model Forms are published on the World Wide Web at:

http://users.aol.com/covenants/

TERM SHEET CHECKLIST FOR UNSECURED DEBT TRANSACTIONS

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