Waiver, Consent & Amend. #1 To B Share Credit Agreement

WAIVER, CONSENT AND AMENDMENT NO. 1


Dated as of February 13, 1997


WAIVER, CONSENT AND AMENDMENT NO. 1 (this "Amendment") among A I M Management Group Inc., a Delaware corporation (the "Borrower"), the banks, financial institutions and other institutional lenders parties to the Credit Agreement referred to below (collectively, the "Lenders"), Citibank, N.A., as administrative agent (the "Administrative Agent") for the Lenders, and the co- agents listed on the signature pages of the Credit Agreement referred to below, as co-agents (the "Co-Agents" and, together with the Administrative Agent, the "Agents").


PRELIMINARY STATEMENTS:


(1) The Borrower, the Lenders and the Agents have entered into a B Share Credit Agreement dated as of June 26, 1996 (the "Credit Agreement"). Capitalized terms not otherwise defined in this Amendment have the same meanings as specified in the Credit Agreement.


(2) The Borrower has entered into an Agreement and Plan of Merger dated as of November 4, 1996 (as amended, supplemented or otherwise modified from time to time, the "Merger Agreement") with INVESCO PLC, a company organized under the laws of England ("INVESCO"), and INVESCO Group Services, Inc., pursuant to which the Borrower will be merged (the "Merger") with a newly-organized subsidiary ("Newco") of INVESCO. Newco will be the surviving corporation of the Merger. Immediately following the Merger, the assets and liabilities of the Borrower (including, without limitation, the rights and obligations of the Borrower under the Credit Agreement) will be contributed (the "Transfer") to a direct, newly-organized subsidiary of Newco to be known as AIM Management Group Acquisition Corp. (which after consummation of the Transfer will change its name to A I M Management Group Inc.)("New AIM"). The rights and obligations of the Borrower under the Credit Agreement will be transferred pursuant to a contribution and assumption agreement (the "Contribution Agreement"). The Merger and the Transfer are collectively referred to as the "Transaction". The Borrower hereby requests that the Required Lenders consent to the consummation of the Transaction and grant the waivers and amendments under the Loan Documents needed to facilitate the Transaction and as otherwise set forth below.


(3) The Required Lenders are, on the terms and conditions stated below, willing to grant the requests of the Borrower and the Borrower and the Required Lenders have agreed to amend the Credit Agreement as hereinafter set forth. 2
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NOW, THEREFORE, in consideration of the premises and of the mutual covenants and agreements contained herein, the parties hereto agree as follows:


SECTION 1. Waiver and Consent. Subject to the satisfaction of the conditions precedent set forth in Section 4(a), the Required Lenders hereby consent to the consummation of the Transaction and in furtherance thereof, agree to the following:


(a) Section 3.02(a) of the Credit Agreement, which
provides for a mandatory prepayment as a result of certain Asset
Sales and a subsequent permanent reduction of the Total
Commitment pursuant to Section 2.04(b)(i) in an amount equal to
any such prepayment, is waived to the extent the Transfer, as
contemplated by the Transaction, constitutes an Asset Sale.


(b) Section 5.02(a)(viii) of the Credit Agreement,
which requires as a condition precedent to each Loan that certain
Distribution Agreements shall not have been cancelled, is waived
to the extent that the change of control resulting from the
consummation of the Transaction will cause an automatic
termination of such Distribution Agreements, provided that such
Distribution Agreements are replaced by agreements that do not
differ materially from such terminated Distribution Agreements on
or before the effective date of the Merger.


(c) Section 7.04 of the Credit Agreement, pursuant to
which the Borrower covenanted not to merge with any Person, is
waived to the extent required to permit the Merger and to
otherwise consummate the Transaction.


(d) Section 7.05(iv) of the Credit Agreement, pursuant
to which the Borrower covenanted not to repurchase, redeem,
defease or retire or otherwise acquire for value, prior to any
scheduled repayment, sinking fund payment or maturity, any Pari
Passu Debt, is waived to the extent required to permit the
Borrower to tender for and redeem any Senior Notes tendered
pursuant to the change of control tender provisions of the Senior
Notes in connection with the Merger, without such payments being
included in Restricted Payments.


(e) Section 7.06 of the Credit Agreement, pursuant to
which the Borrower covenanted not to sell or otherwise dispose of
all or substantially all of its assets, is waived to the extent
required to permit the Transfer and to otherwise consummate the
Transaction.


(f) Section 8.01(p) of the Credit Agreement, pursuant
to which an Event of Default occurs if (i) during a period of two
consecutive years, individuals who at the beginning of such
period constituted the Board of Directors of the Borrower
(together with any new directors whose election to such Board or
whose nomination for election 3
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by the shareholders of the Borrower was approved by a vote of at
least 66-2/3% of the directors then still in office who were
either directors at the beginning of such period or whose
election or nomination for election was previously so approved)
cease for any reason to constitute a majority of such Board of
Directors then in office, or (ii) any "person" or "group" other
than any member of a Key Shareholder Group shall at any time
Beneficially Own a percentage of the outstanding shares of Voting
Stock of the Borrower equal to or greater than 50% of the
aggregate percentage of the outstanding shares of the Voting
Stock of the Borrower Beneficially Owned by all Key Shareholder
Groups, is waived to the extent required to permit the Merger and
to otherwise consummate the Transaction.


(g) Section 8.01(q) of the Credit Agreement, pursuant
to which an Event of Default occurs if at any time the Key
Shareholder Groups or any one or more of the members thereof
shall cease to Beneficially Own in the aggregate at least 20% of
the outstanding Voting Stock of the Borrower, is waived to the
extent required to permit the Merger and to otherwise consummate
the Transaction.


(h) Section 8.01(r) of the Credit Agreement, pursuant
to which an Event of Default occurs if any change in Beneficial
Ownership of the outstanding shares of Voting Stock of the
Borrower shall occur necessitating any consent of the
shareholders or directors of any Investment Company and such
consent is not obtained in a timely manner, or with respect to
the Management Contracts, the consents relating to 90% thereof
are not obtained with the statutory period necessary to prevent
the termination thereof, is waived to the extent required to
permit the Merger and to otherwise consummate the Transaction.


(i) Section 13 of the B Share Collateral Agreement,
which provides that the Borrower shall not, except pursuant to a
Securitization Program, (i) sell, assign (by operation of law or
otherwise) or otherwise dispose of, or grant any option with
respect to, any of the Collateral or (ii) create or suffer to
exist any Lien upon or with respect to any of the Collateral
except the pledge, assignment and security interest created by
the B Share Collateral Agreement, is waived to the extent
required to permit the Transfer and to otherwise consummate the
Transaction.


SECTION 2. Amendments to Credit Agreement. The Credit Agreement is, effective as of the date hereof and subject to the satisfaction of the conditions precedent set forth in Section 4(a), hereby amended as follows:


(a) Section 1.01 and the definition of "Net Income" is
amended by deleting the paragraph in its entirety and adding the
following: 4
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"Net Income" means, with respect to any period, the net income of
the Borrower and its Subsidiaries for such period, all determined
in accordance with GAAP on a Consolidated basis, provided, that
there shall be excluded (a) all extraordinary gains or losses
(less all fees and expenses relating thereto), (b) any gain or
loss, net of taxes, realized upon the termination of any employee
pension benefit plan, (c) the income of any Person accrued prior to
the date it becomes a Subsidiary or is merged into or consolidated
with the Borrower and its Subsidiaries, (d) the income of any
Person (other than a Subsidiary) in which the Borrower and its
Subsidiaries has an ownership interest, except to the extent that
any such income has been actually received by the Borrower and its
Subsidiaries in the form of dividends or similar distributions, (e)
gains or losses (less all fees and expenses relating thereto) in
respect of dispositions of assets other than in the ordinary
course of business and (f) the net income of any Subsidiary to the
extent that the declaration of dividends or similar distributions
by that Subsidiary of that income is not at the time permitted,
directly or indirectly, by operation of the terms of its charter
or any agreement, instrument, judgment, decree, order, statute,
rule or governmental regulations applicable to that Subsidiary or
its shareholders.


(b) Section 1.01 and the definition of "Permitted
Investments" is amended by deleting the phrase that begins with
", provided" in subsection (i) and ends with "at any time".


(c) Section 3.01(c) is amended by substituting
"$3,000,000" for "$5,000,000".


(d) Section 7.05(a)(2)(A) is amended by deleting
subsection (A), by changing December 31, 1995 to November 3,
1993 in subsection (B) and by changing each reference in
subsections (C), (D), (E) and (F) from "the Effective Date" to
"November 3, 1993".


(e) Section 7.20 is amended by deleting "(i)" in the
first line, by substituting "Section 7.20." for " clause
7.20(i);" and by deleting clause (ii) in its entirety.


(f) Section 8.01(f) is amended by substituting
"$5,000,000" for "1,000,000".


(g) Section 8.01(h) is amended by substituting
"$5,000,000" for "$1,000,000". 5
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SECTION 3. Further Amendments Upon Consummation of Transaction. When, and only when, on or before March 3, 1997 the Transaction is consummated, and subject to the satisfaction of the conditions precedent set forth in Section 4(b), the Credit Agreement is hereby further amended as follows:


(a) The recital of the parties is amended by
substituting "A I M Management Acquisition Corp. " for "A I M
Management Group Inc. ".


(b) Section 7.03 is amended by deleting "and" at the
end of subsection (j), deleting the period at the end of
subsection (k) and substituting therefor "; and" and by adding to
the end of Section 7.03 a new subsection (l), to read as follows:


(1) the Borrower and AIM Advisors may become and
remain liable with respect to guaranties of the
indebtedness of INVESCO PLC under that certain Credit
Agreement dated as of February 13, 1997 (the "INVESCO
Credit Agreement") among INVESCO PLC, as borrower,
Citibank and NationsBank, N.A. ("NationsBank") as agents,
the lenders and co-agents parties thereto and NationsBank,
as funding agent; provided, however, that any such
guaranties by AIM Advisors shall contain no terms more
favorable to the beneficiaries thereof than those set
forth in the AIM Guaranties.


(c) Section 8.01(p) is amended by deleting the paragraph
and by adding a new subsection (p) to read as follows:


(p) (i) Any Person or two or more Persons acting
in concert shall have acquired beneficial ownership
(within the meaning of Rule 13d-3 of the Securities and
Exchange Commission under the Securities Exchange Act of
1934), directly or indirectly, of Voting Stock of INVESCO
PLC or the Borrower, as the case may be, (or other
securities convertible into such Voting Stock)
representing 20% or more of the combined voting power of
all Voting Stock of INVESCO PLC or the Borrower, as the
case may be; or (ii) during any period of up to 24
consecutive months, commencing after the date of this
Agreement, individuals who at the beginning of such 24-
month period were directors of INVESCO PLC or the
Borrower, as the case may be, shall cease for any reason
to constitute a majority of the board of directors of
INVESCO PLC or the Borrower, as the case may be (except,
in the cases of clauses (i) and (ii), in connection with
the Merger or pursuant to the Merger Agreement and the
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