Exhibit 10.2

 

EXECUTION COPY

 

 

$65,000,000

 

SECOND LIEN CREDIT AGREEMENT

 

among

 

NEW WORLD RESTAURANT GROUP, INC.,
as Borrower,

 

The Several Lenders
from Time to Time Parties Hereto,

 

and

 

BEAR STEARNS CORPORATE LENDING INC.,
as Administrative Agent

 

Dated as of January 26, 2006

 

 

 

BEAR, STEARNS & CO. INC., as Sole Lead Arranger and Sole Bookrunner

 

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TABLE OF CONTENTS

 

 

 

Page

 

 

 

Section 1.

DEFINITIONS

1

 

 

 

 

 

1.1.

Defined Terms

1

 

1.2.

Other Definitional Provisions

21

 

 

 

 

Section 2.

AMOUNT AND TERMS OF TERM LOAN COMMITMENTS

22

 

 

 

 

 

2.1.

Term Loan Commitments

22

 

2.2.

Procedure for Term Loan Borrowing

22

 

2.3.

Repayment of Term Loans

23

 

 

 

 

Section 3.

[Reserved]

23

 

 

 

 

Section 4.

GENERAL PROVISIONS APPLICABLE TO TERM LOANS

23

 

 

 

 

 

4.1.

Optional Prepayments

23

 

4.2.

Mandatory Prepayments and Term Loan Commitment Reductions

24

 

4.3.

Conversion and Continuation Options

25

 

4.4.

Limitations on Eurodollar Tranches

26

 

4.5.

Interest Rates and Payment Dates

26

 

4.6.

Computation of Interest and Fees

26

 

4.7.

Inability to Determine Interest Rate

27

 

4.8.

Pro Rata Treatment and Payments

27

 

4.9.

Requirements of Law

28

 

4.10.

Taxes

30

 

4.11.

Indemnity

31

 

4.12.

Change of Lending Office

32

 

4.13.

Replacement of Lenders

32

 

4.14.

Evidence of Debt

32

 

4.15.

Illegality

33

 

 

 

 

Section 5.

REPRESENTATIONS AND WARRANTIES

33

 

 

 

 

 

5.1.

Financial Condition

33

 

5.2.

No Change

34

 

5.3.

Corporate Existence; Compliance with Law

34

 

5.4.

Power; Authorization; Enforceable Obligations

34

 

5.5.

No Legal Bar

35

 

5.6.

Litigation

35

 

5.7.

No Default

35

 

5.8.

Ownership of Property; Liens

35

 

5.9.

Intellectual Property

35

 

5.10.

Taxes

36

 

5.11.

Federal Regulations

36

 

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Page

 

 

 

 

5.12.

Labor Matters

36

 

5.13.

ERISA

36

 

5.14.

Investment Company Act; Other Regulations

37

 

5.15.

Subsidiaries

37

 

5.16.

Use of Proceeds

37

 

5.17.

Environmental Matters

37

 

5.18.

Accuracy of Information, etc.

38

 

5.19.

Security Documents

38

 

5.20.

Solvency

39

 

5.21.

Second Lien Obligations

39

 

5.22.

Inactive Subsidiaries

39

 

5.23.

Material Contracts

39

 

5.24.

Bank Accounts.

39

 

5.25.

Insurance.

39

 

 

 

 

Section 6.

CONDITIONS PRECEDENT

39

 

 

 

 

 

6.1.

Conditions to the Closing Date

39

 

6.2.

Conditions to the Initial Borrowing Date

41

 

6.3.

Additional Conditions to Term Loans

43

 

 

 

 

Section 7.

AFFIRMATIVE COVENANTS

44

 

 

 

 

 

7.1.

Financial Statements

44

 

7.2.

Certificates; Other Information

45

 

7.3.

Payment of Obligations

46

 

7.4.

Maintenance of Existence; Compliance

46

 

7.5.

Maintenance of Property; Insurance

46

 

7.6.

Inspection of Property; Books and Records; Discussions

47

 

7.7.

Notices

47

 

7.8.

Environmental Laws

47

 

7.9.

Interest Rate Protection

48

 

7.10.

Additional Collateral, etc.

48

 

7.11.

Further Assurances

50

 

 

 

 

Section 8.

NEGATIVE COVENANTS

50

 

 

 

 

8.1.

Financial Condition Covenants

50

 

8.2.

Indebtedness

52

 

8.3.

Liens

54

 

8.4.

Fundamental Changes

55

 

8.5.

Disposition of Property

56

 

8.6.

Restricted Payments

56

 

8.7.

Capital Expenditures

57

 

8.8.

Investments

57

 

8.9.

Certain Payments and Modifications of Certain Debt Instruments

58

 

8.10.

Transactions with Affiliates

59

 

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Page

 

 

 

 

8.11.

Sales and Leasebacks

59

 

8.12.

Hedge Agreements

59

 

8.13.

Changes in Fiscal Periods

60

 

8.14.

Negative Pledge Clauses

60

 

8.15.

Clauses Restricting Subsidiary Distributions

60

 

8.16.

Lines of Business

60

 

8.17.

Inactive Subsidiaries

61

 

 

 

 

Section 9.

EVENTS OF DEFAULT

61

 

 

 

 

Section 10.

THE AGENTS

64

 

 

 

 

 

10.1.

Appointment

64

 

10.2.

Delegation of Duties

64

 

10.3.

Exculpatory Provisions

64

 

10.4.

Reliance by Agents

64

 

10.5.

Notice of Default

65

 

10.6.

Non-Reliance on Agents and Other Lenders

65

 

10.7.

Indemnification

66

 

10.8.

Agent in Its Individual Capacity

66

 

10.9.

Successor Administrative Agent

66

 

10.10.

Agents Generally

67

 

10.11.

The Lead Arranger

67

 

 

 

 

Section 11.

MISCELLANEOUS

67

 

 

 

 

 

11.1.

Amendments and Waivers

67

 

11.2.

Notices

69

 

11.3.

No Waiver; Cumulative Remedies

70

 

11.4.

Survival of Representations and Warranties

70

 

11.5.

Payment of Expenses and Taxes

70

 

11.6.

Successors and Assigns; Participations and Assignments

71

 

11.7.

Adjustments; Set-off

75

 

11.8.

Counterparts

76

 

11.9.

Severability

76

 

11.10.

Integration; Intercreditor and Subordination Agreements

76

 

11.11.

GOVERNING LAW

76

 

11.12.

Submission To Jurisdiction; Waivers

76

 

11.13.

Acknowledgments

77

 

11.14.

Releases of Guarantees and Liens

77

 

11.15.

Confidentiality

78

 

11.16.

Revival and Reinstatement of Obligations

78

 

11.17.

WAIVERS OF JURY TRIAL

78

 

11.18.

Delivery of Addenda

78

 

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SCHEDULES:

 

 

 

 

 

5.4

 

Consents, Authorizations, Filings and Notices

 

5.15

 

Subsidiaries

 

5.19(a)

 

UCC Filing Jurisdictions

 

5.22

 

Inactive Subsidiaries

 

5.24

 

Bank Accounts

 

5.25

 

Insurance

 

8.2(f)

 

Existing Indebtedness

 

8.3(g)

 

Existing Liens

 

 

 

 

 

EXHIBITS:

 

 

 

 

 

A

 

Form of Addendum

 

B

 

Form of Assignment and Assumption

 

C

 

Form of Compliance Certificate

 

D

 

Form of Guarantee and Collateral Agreement

 

E

 

[Reserved]

 

F

 

Form of Exemption Certificate

 

G

 

Form of Term Note

 

H

 

Form of Closing Certificate

 

I-1

 

Form of Legal Opinion of Holme Roberts & Owen LLP

 

I-2

 

Form of Legal Opinion of Holme Roberts & Owen LLP (Perfection Opinion)

 

J

 

Form of Intercreditor Agreement

 

K

 

Form of Subordinated Loan Agreement

 

L

 

Form of Subordination Agreement

 

M

 

Form of Solvency Certificate

 

 

iv

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SECOND LIEN CREDIT AGREEMENT, dated as of January 26, 2006, among NEW WORLD
RESTAURANT GROUP, INC., a Delaware corporation (the “Borrower”), the several
banks and other financial institutions or entities from time to time parties to
this Agreement (the “Lenders”), BEAR, STEARNS & CO. INC., as sole lead arranger
and sole bookrunner (in such capacity, the “Lead Arranger”), and BEAR STEARNS
CORPORATE LENDING INC., as administrative agent for the Lenders (in such
capacity, the “Administrative Agent”).

 

W I T N E S S E T H:

 

WHEREAS, the Borrower wishes to refinance (the “Refinancing”) (a) its 13% Senior
Notes due 2008 (the “Senior Notes”) in an aggregate outstanding principal amount
of approximately $160,000,000 and (b) its credit facilities available under the
Loan and Security Agreement, dated as of July 8, 2003, among the Borrower,
Manhattan Bagel Company, Inc., Chesapeake Bagel Franchise Corp., Willoughby’s
Incorporated, Einstein and Noah Corp., Einstein/Noah Bagel Partners, Inc. and
I. & J. Bagel, Inc., as borrowers, the financial institutions party thereto and
AmSouth Capital Corp., as administrative agent (as amended, the “Existing Credit
Facility”);

 

WHEREAS, the Borrower has requested that the Lenders make available the credit
facility described in this Agreement in order to finance the Refinancing and to
pay fees and expenses related to the Refinancing; and

 

WHEREAS, the Lenders are willing to make such credit facility available upon and
subject to the terms and conditions hereinafter set forth;

 

NOW, THEREFORE, in consideration of the premises and the agreements hereinafter
set forth, the parties hereto hereby agree as follows:

 

SECTION 1.   DEFINITIONS

 

1.1.          Defined Terms.  As used in this Agreement, the terms listed in
this Section 1.1 shall have the respective meanings set forth in this
Section 1.1.

 

“Acquisition”:  as to any Person, (a) the acquisition of all of the Capital
Stock of another Person, (b) the acquisition of all or substantially all of the
assets of any other Person or (c) the acquisition of all or substantially all of
the assets constituting a business line or division of any other Person.

 

“Addendum”:  an instrument, substantially in the form of Exhibit A, by which a
Lender becomes a party to this Agreement as of the Closing Date.

 

“Administrative Agent”:  as defined in the preamble to this Agreement.

 

“Affiliate”:  as to any Person, any other Person that, directly or indirectly,
is in control of, is controlled by, or is under common control with, such
Person.  For purposes of this definition, “control” of a Person means the power,
directly or indirectly, either to (a) vote 10% or more of the securities having
ordinary voting power for the election of directors (or persons

 

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performing similar functions) of such Person or (b) direct or cause the
direction of the management and policies of such Person, whether by contract or
otherwise.

 

“Agents”:  the collective reference to the Lead Arranger and the Administrative
Agent.

 

“Aggregate Exposure”:  with respect to any Lender at any time, an amount equal
to (a) until the Initial Borrowing Date, the amount of such Lender’s Term Loan
Commitment at such time and (b) thereafter, the then unpaid principal amount of
such Lender’s Term Loans.

 

“Aggregate Exposure Percentage”:  with respect to any Lender at any time, the
ratio (expressed as a percentage) of such Lender’s Aggregate Exposure at such
time to the Aggregate Exposure of all Lenders at such time.

 

“Agreement”:  this Second Lien Credit Agreement.

 

“Applicable Margin”:  (a) 6.75%, in the case of Eurodollar Loans and (b) 5.75%,
in the case of Base Rate Loans.

 

“Approved Fund”:  as defined in Section 11.6(c).

 

“Asset Sale”:  any Disposition of Property or series of related Dispositions of
Property (excluding any such Disposition permitted by clause (a), (b), (c), (d),
(e) and (h) of Section 8.5) that yields gross proceeds to any Group Member
(valued at the initial principal amount thereof in the case of non-cash proceeds
consisting of notes or other debt securities and valued at fair market value in
the case of other non-cash proceeds) in excess of $500,000.

 

“Assignee”:  as defined in Section 11.6(b).

 

“Assignment and Assumption”:  an Assignment and Assumption, substantially in the
form of Exhibit B.

 

“Authorized Person”:  the president, chief executive officer or chief financial
officer and any other officer or employee designated as such by the president,
chief executive officer or chief financial officer of the Borrower.

 

“Base Rate”:  for any day, a rate per annum (rounded upwards, if necessary, to
the next 1/100 of 1%) equal to the greater of (a) the Prime Rate in effect on
such day and (b) the Federal Funds Effective Rate in effect on such day plus
0.50%.  For purposes hereof:  “Prime Rate” shall mean the rate of interest per
annum publicly announced from time to time by the Reference Bank as its prime
rate in effect at its principal office in New York City (the Prime Rate not
being intended to be the lowest rate of interest charged by the Reference Bank
in connection with extensions of credit to debtors).  Any change in the Base
Rate due to a change in the Prime Rate or the Federal Funds Effective Rate shall
be effective as of the opening of business on the effective day of such change
in the Prime Rate or the Federal Funds Effective Rate, respectively.

 

2

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“Base Rate Loans”:  Term Loans the rate of interest applicable to which is based
upon the Base Rate.

 

“Board”:  the Board of Governors of the Federal Reserve System of the United
States (or any successor).

 

“Borrower”:  as defined in the preamble to this Agreement.

 

“Borrowing Date”:  any Business Day specified by the Borrower as a date on which
the Borrower requests the relevant Lenders to make Term Loans hereunder.

 

“Business”:  as defined in Section 5.17(b).

 

“Business Day”:  a day other than a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to close,
provided, that with respect to notices and determinations in connection with,
and payments of principal and interest on, Eurodollar Loans, such day is also a
day for trading by and between banks in Dollar deposits in the interbank
eurodollar market.

 

“Capital Expenditures”:  for any period, with respect to any Person, without
duplication, (i) the aggregate of all expenditures by such Person and its
Subsidiaries for the acquisition of fixed or capital assets or additions to
equipment (including replacements, capitalized repairs and improvements) during
such period, in each case, that should be capitalized under GAAP on a
consolidated balance sheet of such Person and its Subsidiaries and (ii) Capital
Lease Obligations incurred by such Person and its Subsidiaries during such
period, provided that (a) the cost of any Investment permitted under Sections
8.8(k) or 8.8(l) shall not constitute a Capital Expenditure by the Borrower or
any of its Subsidiaries and (b) Capital Expenditures funded with Reinvestment
Deferred Amounts shall not be deemed to be Capital Expenditures.

 

“Capital Lease Obligations”:  as to any Person, the obligations of such Person
to pay rent or other amounts under any lease of (or other arrangement conveying
the right to use) real or personal property, or a combination thereof, which
obligations are required to be classified and accounted for as capital leases on
a balance sheet of such Person under GAAP and, for the purposes of this
Agreement, the amount of such obligations at any time shall be the capitalized
amount thereof at such time determined in accordance with GAAP.

 

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

 

“Cash Collateralized Surety Bonds”:  Indebtedness of the Borrower and its
Subsidiaries in respect of surety bonds permitted under Section 8.2(k)(A) to the
extent such Indebtedness is cash collateralized with cash or Cash Equivalents
subject to a Lien in favor of the holders of such Indebtedness.

 

3

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“Cash Equivalents”:  (a) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States Government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one calendar year from the date of acquisition;
(b) certificates of deposit, time deposits, eurodollar time deposits or
overnight bank deposits having maturities of six months or less from the date of
acquisition issued by any Lender or by any commercial bank organized under the
laws of the United States or any state thereof having combined capital and
surplus of not less than $500,000,000; (c) commercial paper of an issuer rated
at least A-1 by Standard & Poor’s Ratings Services (“S&P”) or P-1 by Moody’s
Investors Service, Inc. (“Moody’s”), or carrying an equivalent rating by a
nationally recognized rating agency, if both of the two named rating agencies
cease publishing ratings of commercial paper issuers generally, and maturing
within six months from the date of acquisition; (d) repurchase obligations of
any Lender or of any commercial bank satisfying the requirements of
clause (b) of this definition, having a term of not more than 30 days, with
respect to securities issued or fully guaranteed or insured by the United States
government; (e) securities with maturities of one year or less from the date of
acquisition issued or fully guaranteed by any state, commonwealth or territory
of the United States, by any political subdivision or taxing authority of any
such state, commonwealth or territory or by any foreign government, the
securities of which state, commonwealth, territory, political subdivision,
taxing authority or foreign government (as the case may be) are rated at least A
by S&P or A by Moody’s; (f) securities with maturities of six months or less
from the date of acquisition backed by standby letters of credit issued by any
Lender or any commercial bank satisfying the requirements of clause (b) of this
definition; or (g) shares of money market mutual or similar funds which invest
exclusively in assets satisfying the requirements of clauses (a) through (f) of
this definition or money market funds that (i) comply with the criteria set
forth in Securities and Exchange Commission Rule 2a-7 under the Investment
Company Act of 1940, as amended, (ii) are rated AAA by S&P and Aaa by Moody’s
and (iii) have portfolio assets of at least $5,000,000,000.

 

“Closing Date”:  the date on which the conditions precedent set forth in
Section 6.1 shall have been satisfied, which date is January 26, 2006.

 

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

 

“Coke Beverage Marketing Agreement”:  the Beverage Marketing Agreement, dated as
of December 30, 2004, among the Borrower, The Coca-Cola Company and Odwalla
Inc., as amended from time to time.

 

“Collateral”:  all property of the Loan Parties, now owned or hereafter
acquired, upon which a Lien is purported to be created by any Security Document.

 

“Commonly Controlled Entity”:  an entity, whether or not incorporated, that is
under common control with the Borrower within the meaning of Section 4001 of
ERISA or is part of a group that includes the Borrower and that is treated as a
single employer under Section 414(b) or (c) of the Code (and, solely for
purposes of Section 412 of the Code, under Section 414(m), (n), and (o) of the
Code).

 

4

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“Compliance Certificate”:  a certificate duly executed by a Responsible Officer
substantially in the form of Exhibit C.

 

“Conduit Lender”:  any special purpose entity organized and administered by any
Lender for the purpose of making Term Loans otherwise required to be made by
such Lender and designated by such Lender in a written instrument, subject to
the consent of the Administrative Agent and the Borrower (which consent shall
not be unreasonably withheld); provided, that the designation by any Lender of a
Conduit Lender shall not relieve the designating Lender of any of its
obligations to fund a Term Loan under this Agreement if, for any reason, its
Conduit Lender fails to fund any such Term Loan, and the designating Lender (and
not the Conduit Lender) shall have the sole right and responsibility to deliver
all consents and waivers required or requested under this Agreement with respect
to its Conduit Lender, and provided, further, that no Conduit Lender shall
(a) be entitled to receive any greater amount pursuant to Section 4.9, 4.10,
4.11 or 11.5 than the designating Lender would have been entitled to receive in
respect of the extensions of credit made by such Conduit Lender or (b) be deemed
to have any Term Loan Commitment.

 

“Consolidated Current Assets”:  at any date, all amounts (other than cash and
Cash Equivalents but including any “restricted cash” under GAAP) that would, in
conformity with GAAP, be set forth opposite the caption “total current assets”
(or any like caption) on a consolidated balance sheet of the Borrower and its
Subsidiaries at such date.

 

“Consolidated Current Liabilities”:  at any date, all amounts that would, in
conformity with GAAP, be set forth opposite the caption “total current
liabilities” (or any like caption) on a consolidated balance sheet of the
Borrower and its Subsidiaries at such date, but excluding (a) the current
portion of any Long-Term Debt of the Borrower and its Subsidiaries and
(b) without duplication of clause (a) above, all Indebtedness consisting of
Revolving Loans (as defined in the First Lien Credit Agreement) or Swingline
Loans (as defined in the First Lien Credit Agreement) to the extent otherwise
included therein.

 

“Consolidated EBITDA”:  for any period, Consolidated Net Income for such period
plus, without duplication and to the extent deducted in determining Consolidated
Net Income for such period, the sum of (a) income tax expense, (b) interest
expense, amortization or writeoff of debt discount and debt issuance costs and
commissions, discounts and other fees and charges associated with Indebtedness
(including the Term Loans, the First Lien Term Loans and the Subordinated
Loans), (c) depreciation and amortization expense, (d) amortization of
intangibles (including, but not limited to, goodwill) and organization costs,
(e) any extraordinary charges or extraordinary losses determined in accordance
with GAAP, (f) non-cash compensation expenses arising from the issuance of
stock, options to purchase stock and stock appreciation rights to the employees
of the Borrower, (g) reasonable legal, accounting, financing, consulting,
advisory and out-of-pocket fees and expenses incurred in connection with the
initial consummation of permitted incurrences of Indebtedness by the Borrower or
any of its Subsidiaries after the date hereof under Section 8.2(a), 8.2(b),
8.2(c), 8.2(g), 8.2(l) or 8.2(m), issuances of Capital Stock of the Borrower,
permitted Dispositions under Sections 8.5(f), 8.5(g) or 8.5(i) and permitted
Investments under Sections 8.8(k) or 8.8(l), (h) fees and expenses related to
store closures incurred during the first three fiscal years ending after the
Initial Borrowing Date and not exceeding $1,000,000 per fiscal year,
(i) non-cash charges related to changes in the

 

5

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exposure of the Borrower and its Subsidiaries under Hedge Agreements, (j)
reorganization costs, expenses or charges recorded during the fiscal year ended
December 31, 2005 not exceeding $1,600,000 in the aggregate (with such amounts
to be added back in the quarter (and any four quarter period which includes such
quarter) during which the cost, expense or charge was recorded and only the
amount recorded during such quarter), (k) cash expenses related to the “Ruskin
Moscou Faltischek, P.C. v. New World Restaurant Group, Inc.” litigation in an
aggregate amount not to exceed $500,000 (with such expenses to be added back in
the quarter (and any four quarter period which includes such quarter) during
which such expense is recorded and only the amount recorded during such quarter)
and (l) any other non-cash charges, non-cash expenses or non-cash losses of the
Borrower or any of its Subsidiaries for such period (excluding any such charge,
expense or loss incurred in the ordinary course of business that constitutes an
accrual of or a reserve for cash charges for any future period), provided,
however, that cash payments made in such period or in any future period in
respect of such non-cash charges, expenses or losses (excluding any such charge,
expense or loss incurred in the ordinary course of business that constitutes an
accrual of or a reserve for cash charges for any future period) shall be
subtracted from Consolidated Net Income in calculating Consolidated EBITDA in
the period when such payments are made, and minus, to the extent included in
determining such Consolidated Net Income for such period, the sum of
(a) interest income, (b) any extraordinary income or gains determined in
accordance with GAAP and (c) any other non-cash income (excluding any items that
represent the reversal of any accrual of, or cash reserve for, anticipated cash
charges in any prior period that are described in the parenthetical to
clause (l) above), all as determined on a consolidated basis.  For the purposes
of calculating Consolidated EBITDA for any period of four consecutive fiscal
quarters (each, a “Reference Period”) pursuant to any determination of the
Consolidated Leverage Ratio, (i) if at any time during such Reference Period the
Borrower or any Subsidiary shall have made any Material Disposition, the
Consolidated EBITDA for such Reference Period shall be reduced by an amount
equal to the Consolidated EBITDA (if positive) attributable to the property that
is the subject of such Material Disposition for such Reference Period or
increased by an amount equal to the Consolidated EBITDA (if negative)
attributable thereto for such Reference Period and (ii) if during such Reference
Period the Borrower or any Subsidiary shall have made a Material Acquisition,
Consolidated EBITDA for such Reference Period shall be calculated after giving
pro forma effect thereto as if such Material Acquisition occurred on the first
day of such Reference Period.  As used in this definition, “Material
Acquisition” means any Acquisition that involves the payment of consideration by
the Borrower and its Subsidiaries in excess of $2,500,000; and “Material
Disposition” means any Disposition of property or series of related Dispositions
of property that yields gross proceeds to the Borrower or any of its
Subsidiaries in excess of $2,500,000.

 

“Consolidated First Lien Debt”: on any date of determination, Consolidated Total
Debt as of such date minus the sum of (a) the aggregate outstanding principal
amount of Term Loans and Subordinated Loans on such date and (b) the aggregate
amount of unsecured Indebtedness on such date.

 

“Consolidated First Lien Leverage Ratio”: at any time, the ratio of
(a) Consolidated First Lien Debt at such time to (b) Consolidated EBITDA for the
most recent period of four consecutive fiscal quarters for which financial
statements have been delivered.

 

6

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“Consolidated Fixed Charge Coverage Ratio”:  for any period, the ratio of
(a) Consolidated EBITDA for such period plus Consolidated Lease Expense for such
period to (b) Consolidated Fixed Charges for such period.

 

“Consolidated Fixed Charges”:  for any period, the sum (without duplication) of
(a) Consolidated Interest Expense for such period and (b) Consolidated Lease
Expense for such period.

 

“Consolidated Interest Expense”:  for any period, total cash interest expense
(including that attributable to Capital Lease Obligations) of the Borrower and
its Subsidiaries for such period with respect to all outstanding Indebtedness
(other than the Excluded Items) of the Borrower and its Subsidiaries (including
all commissions, discounts and other fees and charges owed with respect to
letters of credit and bankers’ acceptance financing and net costs under Hedge
Agreements in respect of interest rates to the extent such net costs are
allocable to such period in accordance with GAAP); provided that (a) for the
purposes of determining Consolidated Interest Expense for the fiscal quarters
ending March 31, 2006, June 30, 2006 and September 30, 2006, Consolidated
Interest Expense for the relevant period shall be deemed to equal Consolidated
Interest Expense for such fiscal quarter (and, in the case of the latter two
such determinations, each previous fiscal quarter commencing after December 31,
2005) multiplied by 4, 2 and 4/3, respectively and (b) the amount of any
interest income during such period in respect of “restricted cash” under GAAP
shall be deducted in calculating Consolidated Interest Expense for such period.

 

“Consolidated Lease Expense”:  for any period, the excess of (a) the aggregate
amount of fixed and contingent rentals payable by the Borrower and its
Subsidiaries for such period with respect to leases of real and personal
property, determined on a consolidated basis in accordance with GAAP, provided
that payments in respect of Capital Lease Obligations shall not be included in
this clause (a), over (b) the aggregate amount of rentals paid to the Borrower
and its Subsidiaries during such period with respect to leases of real and
personal property by the Borrower and its Subsidiaries, and provided further,
that Consolidated Lease Expense shall not include any fixed or contingent
rentals payable by Persons (other than the Borrower and its Subsidiaries) with
respect to leases of real or personal property solely because such rentals are
subject to a Guarantee Obligation issued by the Borrower or any of its
Subsidiaries unless such Persons shall be in default of their obligations under
any such leases or such rentals shall actually be paid by the Borrower and its
Subsidiaries.

 

“Consolidated Leverage Ratio”:  at any time, the ratio of (a) Consolidated Total
Debt at such time to (b) Consolidated EBITDA for the most recent period of four
consecutive fiscal quarters for which financial statements have been delivered.

 

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

 

7

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declaration or payment of dividends or similar distributions by such Subsidiary
is not at the time permitted by the terms of any Contractual Obligation (other
than under any Loan Document) or Requirement of Law applicable to such
Subsidiary, provided, that this clause (b) shall not apply to customary surplus
requirements under applicable law related to the payment of dividends.

 

“Consolidated Total Debt”:  at any date, the aggregate principal amount of all
Indebtedness of the Borrower and its Subsidiaries as set forth on a consolidated
balance sheet of the Borrower at such date in accordance with GAAP, determined
on a consolidated basis in accordance with GAAP, excluding (i) the Excluded
Items and (ii) items that appear solely in the footnotes thereto.

 

“Consolidated Working Capital”:  at any date, the excess of Consolidated Current
Assets on such date over Consolidated Current Liabilities on such date.

 

“Continuing Directors”:  the directors of the Borrower on the Closing Date,
after giving effect to the transactions contemplated hereby, and each other
director, if such other director’s nomination for election to the board of
directors of the Borrower is recommended by at least 51% of the then Continuing
Directors or such other director receives the vote of the Permitted Investors in
his or her election by the shareholders of the Borrower.

 

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

 

“Control Agreement”:  a control agreement in favor of the First Lien
Administrative Agent and the Administrative Agent having terms and conditions
reasonably satisfactory to the Administrative Agent and executed and delivered
by the financial institution with whom the relevant account is maintained and
the applicable Loan Parties.

 

“Control Investment Affiliate”:  as to any Person, any other Person that
(a) directly or indirectly, is in control of, is controlled by, or is under
common control with, such Person and (b) is organized by such Person primarily
for the purpose of making equity or debt investments in one or more companies. 
For purposes of this definition, “control” of a Person means the power, directly
or indirectly, to direct or cause the direction of the management and policies
of such Person whether by contract or otherwise.

 

“Default”:  any of the events specified in Section 9, whether or not any
requirement for the giving of notice, the lapse of time, or both, has been
satisfied.

 

“Defaulting Lender”:  as defined in Section 4.13.

 

“Disposition”:  with respect to any Property, any sale, lease, license, sale and
leaseback, assignment, conveyance, transfer or other disposition thereof.  The
terms “Dispose” and “Disposed of” shall have correlative meanings.

 

“Dollars” and “$”:  dollars in lawful currency of the United States.

 

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“Domestic Subsidiary”:  any Subsidiary of the Borrower organized under the laws
of any jurisdiction within the United States.

 

“ECF Percentage”:  75%, provided that, to the extent that the Consolidated
Leverage Ratio is equal to or less than 2.75 to 1.00 as of the last day of any
fiscal year, the ECF Percentage with respect to such fiscal year shall be 50%.

 

“Environmental Laws”:  any and all foreign, Federal, state, local or municipal
laws, rules, orders, regulations, statutes, ordinances, codes, decrees,
requirements of any Governmental Authority or other Requirements of Law
(including common law) regulating, relating to or imposing liability or
standards of conduct concerning protection of human health or the environment,
as now or may at any time hereafter be in effect.

 

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

 

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

 

“Eurodollar Base Rate”:  with respect to each day during each Interest Period
pertaining to a Eurodollar Loan, the rate per annum determined on the basis of
the rate for deposits in Dollars for a period equal to such Interest Period
commencing on the first day of such Interest Period appearing on Page 3750 of
the Telerate screen as of 11:00 A.M., London time, two Business Days prior to
the beginning of such Interest Period.  In the event that such rate does not
appear on Page 3750 of the Telerate screen (or otherwise on such screen), the
“Eurodollar Base Rate” shall be determined by reference to such other comparable
publicly available service for displaying eurodollar rates as may be selected by
the Administrative Agent or, in the absence of such availability, by reference
to the rate at which the Administrative Agent (or its designee) is offered
Dollar deposits at or about 11:00 A.M., New York City time, two Business Days
prior to the beginning of such Interest Period in the interbank eurodollar
market where its eurodollar and foreign currency and exchange operations are
then being conducted for delivery on the first day of such Interest Period for
the number of days comprised therein.

 

“Eurodollar Loans”:  Term Loans the rate of interest applicable to which is
based upon the Eurodollar Rate.

 

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

 

 

Eurodollar Base Rate

 

1.00 - Eurocurrency Reserve Requirements

 

9

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“Eurodollar Tranche”:  the collective reference to Eurodollar Loans the then
current Interest Periods with respect to all of which begin on the same date and
end on the same later date (whether or not such Term Loans shall originally have
been made on the same day).

 

“Event of Default”:  any of the events specified in Section 9, provided that any
requirement for the giving of notice, the lapse of time, or both, has been
satisfied.

 

“Excess Cash Flow”:  for any fiscal year of the Borrower, the excess, if any, of
(a) the sum, without duplication, of (i) Consolidated Net Income for such fiscal
year (other than Consolidated Net Income arising out of any Asset Sale during
such fiscal year), (ii) the amount of all non-cash charges (including
depreciation and amortization) deducted in arriving at such Consolidated Net
Income, (iii) decreases in Consolidated Working Capital for such fiscal year,
(iv) the aggregate net amount of non-cash loss on the Disposition of Property by
the Borrower and its Subsidiaries during such fiscal year (other than sales of
inventory in the ordinary course of business), to the extent deducted in
arriving at such Consolidated Net Income, and (v) cash payments in respect of
the net decrease (if any) during such period of outstanding Investments under
Sections 8.8(d), (f) and (g), over (b) the sum, without duplication, of (i) the
amount of all non-cash gains or credits included in arriving at such
Consolidated Net Income, (ii) the aggregate amount of Capital Expenditures of
the Borrower and its Subsidiaries during such fiscal year (excluding the
principal amount of Indebtedness incurred to finance such expenditures (but
including repayments of any such Indebtedness incurring during such period or
any prior period)), (iii) the aggregate amount of all prepayments of Revolving
Loans (as defined in the First Lien Credit Agreement) and Swingline Loans (as
defined in the First Lien Credit Agreement) during such fiscal year to the
extent accompanying permanent optional reductions of the Revolving Commitments
(as defined in the First Lien Credit Agreement) and all optional prepayments of
the Term Loans and the First Lien Loans during such fiscal year together with
any prepayment premium paid in connection therewith, (iv) the aggregate amount
of all regularly scheduled principal payments of Long-Term Debt (including the
Term Loans, the First Lien Loans and the Subordinated Loans) of the Borrower and
its Subsidiaries made during such fiscal year (other than in respect of any
revolving credit facility to the extent there is not an equivalent permanent
reduction in commitments thereunder), (v) increases in Consolidated Working
Capital for such fiscal year, (vi) the aggregate net amount of non-cash gain on
the Disposition of Property by the Borrower and its Subsidiaries during such
fiscal year (other than sales of inventory in the ordinary course of business),
to the extent included in arriving at such Consolidated Net Income, (vii) cash
payments in respect of the net increase (if any) during such period of
outstanding Investments under Sections 8.8(d), (f) and (g) and (viii) cash
contributions required by law to be made to, and made to, any Plan during such
period.

 

“Excess Cash Flow Application Date”:  as defined in Section 4.2.

 

“Excluded Indebtedness”:  all Indebtedness permitted by Section 8.2.

 

“Excluded Items”: collectively, (i) the Series Z Preferred, (ii) the NJEDA Debt,
(iii) the Indebtedness under the Coke Beverage Marketing Agreement and (iv) Cash
Collateralized Surety Bonds, provided, that (x) the NJEDA Debt shall constitute
an Excluded Item only to the extent cash reserves are maintained exclusively for
the purpose of repaying the NJEDA Debt at its maturity and (y) the Coke Beverage
Marketing Agreement shall only

 

10

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constitute an Excluded Item to the extent a default shall not have occurred and
be continuing thereunder which permits The Coca-Cola Company to terminate such
agreement (after giving effect to any applicable cure periods) and to cause the
“Advance” or similar advances thereunder to become due and payable unless the
parties to the Coke Beverage Marketing Agreement are negotiating in good faith
to resolve such default in accordance with the dispute resolution provisions in
such agreement (in which case the Coke Beverage Marketing Agreement shall remain
an Excluded Item until the parties are no longer engaged in such negotiations in
accordance with such provisions).

 

“Existing Credit Facility”:  as defined in the recitals to this Agreement.

 

“Facility”:  the Term Loan Commitments and the Term Loans made thereunder.

 

“Federal Funds Effective Rate”:  for any day, the weighted average of the rates
on overnight federal funds transactions with members of the Federal Reserve
System arranged by federal funds brokers, as published on the next succeeding
Business Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day that is a Business Day, the average of the quotations for
the day of such transactions received by the Reference Bank from three federal
funds brokers of recognized standing selected by it.

 

“First Lien Administrative Agent”: Well Fargo Foothill, Inc. and its successors
and assigns.

 

“First Lien Credit Agreement”: the First Lien Credit Agreement, dated as of
January 26, 2006, among the Borrower, the several banks and other financial
institutions from time to time parties thereto, and Wells Fargo Foothill, Inc.,
as administrative agent.

 

“First Lien Loans”: collectively, the term loans and the revolving loans made
under the First Lien Credit Agreement.

 

“First Lien Obligations”: as defined in the Intercreditor Agreement.

 

“First Lien Term Loans”: the “Term Loans” as defined in the First Lien Credit
Agreement.

 

 “Foreign Subsidiary”:  any Subsidiary of the Borrower that is not a Domestic
Subsidiary.

 

“Funding Office”:  the office of the Administrative Agent specified in
Section 11.2 or such other office as may be specified from time to time by the
Administrative Agent as its funding office by written notice to the Borrower and
the Lenders.

 

“GAAP”:  generally accepted accounting principles in the United States as in
effect from time to time.

 

“Governmental Authority”:  any nation or government, any state or other
political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, central bank or other entity exercising executive,
legislative, judicial, taxing, regulatory or administrative

 

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functions of or pertaining to government, any securities exchange and any
self-regulatory organization (including the National Association of Insurance
Commissioners).

 

“Group Members”:  the collective reference to the Borrower and its respective
Subsidiaries.

 

“Guarantee and Collateral Agreement”:  the Guarantee and Collateral Agreement to
be executed and delivered by the Borrower and each Subsidiary Guarantor,
substantially in the form of Exhibit D.

 

“Guarantee Obligation”:  as to any Person (the “guaranteeing person”), any
obligation of (a) the guaranteeing person or (b) another Person (including any
bank under any letter of credit) to induce the creation of which the
guaranteeing person has issued a reimbursement, counterindemnity or similar
obligation, in either case guaranteeing or in effect guaranteeing any
Indebtedness, leases, dividends or other obligations (the “primary obligations”)
of any other third Person (the “primary obligor”) in any manner, whether
directly or indirectly, including any obligation of the guaranteeing person,
whether or not contingent, (i) to purchase any such primary obligation or any
property constituting direct or indirect security therefor, (ii) to advance or
supply funds (1) for the purchase or payment of any such primary obligation or
(2) to maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary obligor, (iii) to
purchase property, securities or services primarily for the purpose of assuring
the owner of any such primary obligation of the ability of the primary obligor
to make payment of such primary obligation or (iv) otherwise to assure or hold
harmless the owner of any such primary obligation against loss in respect
thereof; provided, however, that the term Guarantee Obligation shall not include
endorsements of instruments for deposit or collection in the ordinary course of
business.  The amount of any Guarantee Obligation of any guaranteeing person
shall be deemed to be the lower of (a) an amount equal to the stated or
determinable amount of the primary obligation in respect of which such Guarantee
Obligation is made and (b) the maximum amount for which such guaranteeing person
may be liable pursuant to the terms of the instrument embodying such Guarantee
Obligation, unless such primary obligation and the maximum amount for which such
guaranteeing person may be liable are not stated or determinable, in which case
the amount of such Guarantee Obligation shall be such guaranteeing person’s
maximum reasonably anticipated liability in respect thereof as determined by the
Borrower in good faith.

 

“Hedge Agreements”:  as defined in the Intercreditor Agreement.

 

“Inactive Subsidiaries”: the Subsidiaries listed on Part A of Schedule 5.22.

 

“Indebtedness”:  of any Person at any date, without duplication, (a) all
indebtedness of such Person for borrowed money, (b) all obligations of such
Person for the deferred purchase price of property or services (other than trade
payables incurred in the ordinary course of such Person’s business that are not
outstanding after the later of (i) 60 days after the invoice date or (ii) 30
days after payment is due), (c) all obligations of such Person evidenced by
notes, bonds, debentures or other similar instruments, (d) all indebtedness
created or arising under any conditional sale or other title retention agreement
with respect to property acquired by such Person (even though the rights and
remedies of the seller or lender under such agreement in

 

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the event of default are limited to repossession or sale of such property),
(e) all Capital Lease Obligations of such Person, (f) all obligations of such
Person, contingent or otherwise, as an account party or applicant under or in
respect of acceptances, letters of credit, surety bonds or similar arrangements,
(g) for the purpose of Section 8.2 and the definition of Replacement Equity
only, the liquidation value of all mandatorily redeemable preferred Capital
Stock of such Person, (h) all Guarantee Obligations of such Person in respect of
obligations of the kind referred to in clauses (a) through (g) above, (i) all
obligations of the kind referred to in clauses (a) through (h) above secured by
(or for which the holder of such obligation has an existing right, contingent or
otherwise, to be secured by) any Lien on property (including accounts and
contract rights) owned by such Person, whether or not such Person has assumed or
become liable for the payment of such obligation, (j) for the purposes of
Section 8.2 and Section 9(e) only, all obligations of such Person in respect of
Hedge Agreements and (k) other than with respect to Section 9(e), all
obligations under the Coke Beverage Marketing Agreement or other similar
agreements to the extent such obligations constitute “take-or-pay” arrangements,
provided, that for the purposes of this definition, the “principal amount” of
the obligations of such Person in respect of any Hedge Agreement at any time
shall be the maximum aggregate amount (giving effect to any netting agreements)
that such Person would be required to pay if such Hedge Agreement were
terminated at such time.  The Indebtedness of any Person shall include the
Indebtedness of any other entity (including any partnership in which such Person
is a general partner) to the extent such Person is liable therefor as a result
of such Person’s ownership interest in or other relationship with such entity,
except to the extent the terms of such Indebtedness expressly provide that such
Person is not liable therefor.

 

“Initial Borrowing Date”:  the first date occurring on or after February 28,
2006 on which all the conditions precedent set forth in Sections 6.1 and 6.2
shall have been satisfied, provided, that such date shall occur no later than 40
days after the Closing Date.

 

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

 

“Insolvent”:  pertaining to a condition of Insolvency.

 

“Intellectual Property”:  the collective reference to all rights, priorities and
privileges relating to intellectual property, whether arising under
United States, multinational or foreign laws or otherwise, including copyrights,
copyright licenses, patents, patent licenses, trademarks, trademark licenses,
technology, know-how and processes, and all rights to sue at law or in equity
for any infringement or other impairment thereof, including the right to receive
all proceeds and damages therefrom.

 

“Intercreditor Agreement”:  the Intercreditor Agreement to be executed and
delivered by the Borrower, each Subsidiary Guarantor, the Administrative Agent
and the First Lien Administrative Agent, substantially in the form of Exhibit J.

 

“Interest Payment Date”:  (a) as to any Base Rate Loan, the last day of each
March, June, September and December to occur while such Base Rate Loan is
outstanding and the final maturity date of such Base Rate Loan, (b) as to any
Eurodollar Loan having an Interest Period of three months or less, the last day
of such Interest Period, (c) as to any Eurodollar Loan

 

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having an Interest Period longer than three months, each day that is three
months, or a whole multiple thereof, after the first day of such Interest Period
and the last day of such Interest Period and (d) as to any Base Rate Loan, the
date of any repayment or prepayment made in respect thereof.

 

“Interest Period”:  as to any Eurodollar Loan, (a) initially, the period
commencing on the borrowing or conversion date, as the case may be, with respect
to such Eurodollar Loan and ending one, two, three or six months thereafter, as
selected by the Borrower in its notice of borrowing or notice of conversion, as
the case may be, given with respect thereto; and (b) thereafter, each period
commencing on the last day of the next preceding Interest Period applicable to
such Eurodollar Loan and ending one, two, three or six months thereafter, as
selected by the Borrower by irrevocable notice to the Administrative Agent no
later than 11:00 A.M., New York City time, on the date that is three Business
Days prior to the last day of the then current Interest Period with respect
thereto; provided that, all of the foregoing provisions relating to Interest
Periods are subject to the following:

 

(I)            IF ANY INTEREST PERIOD WOULD OTHERWISE END ON A DAY THAT IS NOT A
BUSINESS DAY, SUCH INTEREST PERIOD SHALL BE EXTENDED TO THE NEXT SUCCEEDING
BUSINESS DAY UNLESS THE RESULT OF SUCH EXTENSION WOULD BE TO CARRY SUCH INTEREST
PERIOD INTO ANOTHER CALENDAR MONTH IN WHICH EVENT SUCH INTEREST PERIOD SHALL END
ON THE IMMEDIATELY PRECEDING BUSINESS DAY;

 

(II)           THE BORROWER MAY NOT SELECT AN INTEREST PERIOD UNDER A PARTICULAR
FACILITY THAT WOULD EXTEND BEYOND THE DATE FINAL PAYMENT IS DUE ON THE TERM
LOANS; AND

 

(III)          ANY INTEREST PERIOD THAT BEGINS ON THE LAST BUSINESS DAY OF A
CALENDAR MONTH (OR ON A DAY FOR WHICH THERE IS NO NUMERICALLY CORRESPONDING DAY
IN THE CALENDAR MONTH AT THE END OF SUCH INTEREST PERIOD) SHALL END ON THE LAST
BUSINESS DAY OF A CALENDAR MONTH.

 

“Investments”:  as defined in Section 8.8.

 

“Lead Arranger”:  as defined in the preamble to this Agreement.

 

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

 

“Lien”:  any mortgage, pledge, hypothecation, assignment, deposit arrangement,
encumbrance, lien (statutory or other), charge or other security interest or any
preference, priority or other security agreement or preferential arrangement of
any kind or nature whatsoever (including any conditional sale or other title
retention agreement and any capital lease having substantially the same economic
effect as any of the foregoing).

 

“Loan Documents”:  this Agreement, the Security Documents and the Notes.

 

“Loan Parties”:  each Group Member that is a party to a Loan Document.

 

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“Long-Term Debt”:  as to any Person, all Indebtedness of such Person that
matures more than one fiscal year from the date of its creation or matures
within one fiscal year from such date but is renewable or extendible, at the
option of such Person, to a date more than one fiscal year from such date or
arises under a revolving credit or similar agreement that obligates the lender
or lenders to extend credit during a period of more than one fiscal year from
such date, including all current maturities and current sinking fund payments in
respect of such Indebtedness whether or not required to be paid within one
fiscal year from the date of its creation and, in the case of the Borrower,
Indebtedness in respect of the Term Loans, the First Lien Loans and the
Subordinated Loans.

 

“Material Acquisition”:  as defined in the definition of Consolidated EBITDA.

 

“Material Adverse Effect”:  a material adverse effect on (a) as of the Initial
Borrowing Date, the Refinancing, (b) the business, assets, property, condition
(financial or otherwise) or results of operations of the Borrower and its
Subsidiaries taken as a whole or (c) the validity or enforceability of this
Agreement or any of the other Loan Documents or the rights or remedies of the
Agents or the Lenders hereunder or thereunder.

 

“Materials of Environmental Concern”:  any gasoline or petroleum (including
crude oil or any fraction thereof) or petroleum products or any hazardous or
toxic substances, materials or wastes, defined or regulated as such in or under
any Environmental Law, including asbestos, polychlorinated biphenyls and
urea-formaldehyde insulation.

 

“Mortgage”:  each of the mortgages and deeds of trust made by any Loan Party in
favor of, or for the benefit of, the Administrative Agent for the benefit of the
Secured Parties.

 

“Multiemployer Plan”:  a Plan that is a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.

 

“Net Cash Proceeds”:  (a) in connection with any Asset Sale or any Recovery
Event, the proceeds thereof received by any Group Member in the form of cash and
Cash Equivalents (including any such proceeds received by way of deferred
payment of principal pursuant to a note or installment receivable or purchase
price adjustment receivable or by the Disposition of any non-cash consideration
received in connection therewith or otherwise, but only as and when received) of
such Asset Sale or Recovery Event, net of attorneys’ fees, accountants’ fees,
other consultants’ fees, investment banking or brokerage fees, amounts required
to be applied to the repayment of Indebtedness secured by a Lien expressly
permitted hereunder on any asset that is the subject of such Asset Sale or
Recovery Event (other than any Lien pursuant to a Security Document) and other
customary fees and expenses actually incurred in connection therewith and net of
taxes paid or reasonably estimated to be payable as a result thereof (after
taking into account any available tax credits or deductions and any tax sharing
arrangements) and net of reserve amounts established by the Borrower or any
Subsidiary for liabilities reasonably anticipated in connection with such Asset
Sale or Recovery Event so long as such reserve amounts are comprised of
segregated cash or Cash Equivalents and will constitute Net Cash Proceeds to the
extent such reserve amounts are no longer required to be maintained and (b) in
connection with any issuance or sale of Capital Stock, any capital contribution
or any incurrence of Indebtedness, the cash proceeds received by any Group

 

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Member from such issuance, contribution or incurrence, net of attorneys’ fees,
other consultants’ fees, investment banking or brokerage fees, accountants’
fees, underwriting discounts and commissions and other customary fees and
expenses actually incurred in connection therewith.

 

“NJEDA Debt”:  the New Jersey Economic Development Authority Notes in a
principal amount (including accrued interest) not to exceed $1,268,000.

 

“Non-Excluded Taxes”:  as defined in Section 4.10(a).

 

“Non-U.S. Lender”:  as defined in Section 4.10(d).

 

“Notes”:  the collective reference to any promissory note evidencing Term Loans.

 

“Obligations”:  as defined in the Intercreditor Agreement.

 

“Other Taxes”:  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 or any other Loan Document.

 

“Participant”:  as defined in Section 11.6(c).

 

“PBGC”:  the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA (or any successor).

 

“Permitted Investors”:  the collective reference to the Sponsor and its Control
Investment Affiliates.

 

“Permitted Refinancing Indebtedness”:  Indebtedness of any Group Member which
satisfies each of the following conditions:  (i) to the extent that the Net Cash
Proceeds of such Indebtedness are used to prepay the Subordinated Loans (or any
other subordinated Indebtedness incurred pursuant to this clause (i)), such
Indebtedness shall be subordinated to the Obligations under the Loan Documents
on substantially the same terms and conditions as are applicable to the
Subordinated Loans or on such other terms as may be approved by the
Administrative Agent and the Required Lenders; (ii) the Consolidated Leverage
Ratio at such time and after giving effect thereto is equal to or less than 3.25
to 1.00 with respect to any prepayment of Subordinated Loans or any other
Indebtedness incurred pursuant to Section 8.2(c); (iii) no Default or Event of
Default shall have occurred and be continuing or would result from the
incurrence of such Indebtedness; (iv) the Administrative Agent shall have
received a copy of all the documents relating to such Indebtedness at least five
days prior to the funding of any such Indebtedness; (v) the terms and conditions
of any such Indebtedness shall not be materially more restrictive taken as a
whole to the Borrower and its Subsidiaries than the terms of the Indebtedness
being refinanced as determined in good faith by the Borrower; (vi) in the case
of Indebtedness used to refinance Subordinated Loans or any other Indebtedness
incurred pursuant to Section 8.2(c), such Indebtedness shall not have a stated
final maturity before the maturity date of the Indebtedness being refinanced
thereby and shall not be subject to any amortization or required repurchase or
redemption obligations on or prior to such date; (vii) the Net Cash Proceeds of
such Indebtedness are concurrently applied to the prepayment of the

 

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Indebtedness to be refinanced with such Net Cash Proceeds; and (viii) the
Administrative Agent shall have received a certificate of a Responsible Officer
certifying compliance with the conditions set forth in this definition (and
attaching reasonable detailed supporting calculations and other information
reasonably required by the Administrative Agent).

 

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

 

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

 

“Pre-Funding Date”:  as defined in Section 2.2.

 

“Pro Forma Balance Sheet”:  as defined in Section 5.1(a).

 

“Projections”:  as defined in Section 7.2(b).

 

“Properties”:  as defined in Section 5.17(a).

 

“Property”:  as to any Person, any right or interest in or to property of any
kind whatsoever, whether real, personal or mixed and whether tangible or
intangible, including, without limitation, Capital Stock of any Subsidiary of
such Person but excluding any Capital Stock of such Person.

 

“Public Filings”:  the Borrower’s most recent filings on forms 10-K and 10-Q
with the SEC since the Closing Date.

 

 “Recovery Event”:  any settlement of or payment in respect of any property or
casualty insurance claim or any condemnation proceeding relating to any asset of
any Group Member that yields gross proceeds to any Group Member in excess of
$500,000.

 

“Reference Bank”:  Bank of New York.

 

“Refinancing”:  as defined in the recitals to this Agreement.

 

“Register”:  as defined in Section 11.6(b).

 

“Regulation U”:  Regulation U of the Board as in effect from time to time.

 

“Reinvestment Deferred Amount”: with respect to any Reinvestment Event, the
aggregate Net Cash Proceeds received by any Group Member in connection therewith
that are not applied to prepay the Term Loans pursuant to Section 4.2(c) as a
result of the delivery of a Reinvestment Notice.

 

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“Reinvestment Event”: any Asset Sale or Recovery Event in respect of which the
Borrower has delivered a Reinvestment Notice.

 

 “Reinvestment Notice”: a written notice executed by a Responsible Officer
stating that no Event of Default has occurred and is continuing and that the
Borrower (directly or through a Subsidiary) intends and expects to use all or a
specified portion of the Net Proceeds of an Asset Sale or Recovery Event to
acquire or repair fixed or capital assets useful in its business.

 

“Reinvestment Prepayment Amount”:  with respect to any Reinvestment Event, the
Reinvestment Deferred Amount relating thereto less any amount expended prior to
the relevant Reinvestment Prepayment Date to acquire or repair fixed or capital
assets useful in the Borrower’s business.

 

 “Reinvestment Prepayment Date”: with respect to any Reinvestment Event, the
earlier of (a) the date occurring six months after such Reinvestment Event and
(b) the date on which the Borrower shall have determined not to, or shall have
otherwise ceased to, acquire or repair fixed or capital assets useful in the
Borrower’s business with all or any portion of the relevant Reinvestment
Deferred Amount, provided that to the extent the Borrower or any of its
Subsidiaries has entered a binding agreement within six months after such
Reinvestment Event to acquire or repair fixed or capital assets useful in the
Borrower’s business, the six month period in clause (a) shall be extended for an
additional period of six months (or, if earlier, the expiration or termination
of such binding agreement).

 

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

 

“Replacement Equity”:  the collective reference to any Capital Stock issued by
the Borrower after the Closing Date, the Net Cash Proceeds of which are used
substantially concurrently, after giving effect to any required notice of
redemption, to redeem all or a portion of the outstanding Series Z Preferred so
long as such Capital Stock consists of either:  (a) preferred stock of the
Borrower (not constituting Indebtedness), the terms of which are (i) no less
favorable to the Lenders, taken as a whole, than the Series Z Preferred and, in
any event, the terms of which do not require cash payment of dividends or
mandatory redemption or repurchase thereof prior to the date that is six years
and six months after the Closing Date, or (ii) otherwise reasonably satisfactory
to the Administrative Agent or (b) common stock of the Borrower.

 

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

 

“Required Lenders”:  at any time, the holders of more than 50% of (a) until the
Initial Borrowing Date, the Term Loan Commitments then in effect and
(b) thereafter, the aggregate unpaid principal amount of the Term Loans then
outstanding.

 

“Requirement of Law”:  as to any Person, the Certificate of Incorporation and
By-Laws or other organizational or governing documents of such Person, and any
law, treaty, rule or regulation or determination of an arbitrator or a court or
other Governmental Authority, in

 

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each case applicable to or binding upon such Person or any of its property or to
which such Person or any of its property is subject.

 

“Responsible Officer”:  the chief executive officer, president or chief
financial officer of the Borrower, but in any event, with respect to financial
matters, the chief financial officer of the Borrower.

 

“Restricted Payments”:  as defined in Section 8.6.

 

“SEC”:  the Securities and Exchange Commission, any successor thereto and any
analogous Governmental Authority.

 

“Second Lien Obligations”: as defined in the Intercreditor Agreement.

 

“Second Lien Qualified Counterparty”: as defined in the Intercreditor Agreement.

 

“Secured Parties”:  as defined in the Guarantee and Collateral Agreement.

 

“Security Documents”:  the collective reference to the Guarantee and Collateral
Agreement, the Mortgages, if any, the Intercreditor Agreement, the Subordination
Agreement, and all other security documents hereafter delivered to the
Administrative Agent granting a Lien on any property of any Person to secure the
obligations and liabilities of any Loan Party to any Lender under any Loan
Document.

 

“Senior Notes”:  as defined in the recitals hereto.

 

“Series Z Preferred”:  the 57,000 shares of Series Z Preferred Stock issued by
the Borrower, par value $0.001 per share.

 

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

 

“Solvent”:  when used with respect to any Person, means that, as of any date of
determination, (a) the fair value of the assets of such Person will, as of such
date, exceed the amount of all debts of such Person, contingent or otherwise, as
of such date, (b) the fair value of the assets of such Person will, as of such
date, be greater than the amount that will be required to pay the liability of
such Person on its debts as such debts become absolute and matured, (c) such
Person will not have, as of such date, an unreasonably small amount of capital
with which to conduct its business, and (d) such Person will be able to pay its
debts as they mature.  For purposes of this definition, (i) ”debt” means
liability on a “claim”, and (ii) ”claim” means any (x) right to payment, whether
or not such a right is reduced to judgment, liquidated, unliquidated, fixed,
contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured
or unsecured or (y) right to an equitable remedy for breach of performance if
such breach gives rise to a right to payment, whether or not such right to an
equitable remedy is reduced to judgment, fixed, contingent, matured or
unmatured, disputed, undisputed, secured or unsecured.

 

“Specified Cash Management Agreement”: as defined in the Intercreditor
Agreement.

 

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“Specified Change of Control”:  the occurrence of a “Merger” or “Change of
Control” (or any other defined term having a similar purpose) as defined in the
Certificate of Designation for the Series Z Preferred (and any Replacement
Equity), provided that a “Specified Change of Control” shall only occur in
respect of the Series Z Preferred (and any Replacement Equity) to the extent
that (a) any shares of Series Z Preferred (and any Replacement Equity) remain
outstanding and (b) the occurrence of a “Merger” or “Change of Control” (or any
other defined term having a similar purpose) gives the holder of such shares of
Series Z Preferred (and any Replacement Equity) the right to cause such shares
to be redeemed or repurchased at the option of such holder.

 

“Specified Hedge Agreement”: as defined in the Intercreditor Agreement.

 

“Sponsor”:  Greenlight Capital, Inc. and its Control Investment Affiliates.

 

“Subordinated Loans”:  the loans made on the Initial Borrowing Date pursuant to
the Subordinated Loan Agreement.

 

“Subordinated Loan Agreement”:  the Subordinated Loan Agreement to be entered
into on the Closing Date, substantially in the form of Exhibit K.

 

“Subordination Agreement”: the Subordination Agreement entered into on the
Closing Date, substantially in the form of Exhibit L.

 

“Subsidiary”:  as to any Person, a corporation, partnership, limited liability
company or other entity (a) of which shares of stock or other ownership
interests having ordinary voting power (other than stock or such other ownership
interests having such power only by reason of the happening of a contingency) to
elect a majority of the board of directors or other employees of such
corporation, partnership or other entity are at the time owned by such Person,
or (b) the management of which is otherwise controlled, directly or indirectly
through one or more intermediaries, or both, by such Person, but only if, in the
case of this clause (b), such entity is treated as a consolidated subsidiary
under GAAP.  Unless otherwise qualified, all references to a “Subsidiary” or to
“Subsidiaries” in this Agreement shall refer to a Subsidiary or Subsidiaries of
the Borrower.  Inactive Subsidiaries shall not be “Subsidiaries” of the Borrower
for purposes of Section 5 (other than Section 5.22), Section 7 or Section 8
(other than Section 8.17).

 

“Subsidiary Guarantor”:  each Subsidiary of the Borrower other than any Foreign
Subsidiary or any Inactive Subsidiary.

 

“Term Lender”:  each Lender that has a Term Loan Commitment or that holds a Term
Loan.

 

“Term Loan”:  as defined in Section 2.1.

 

“Term Loan Commitment”: as to any Lender, the obligation of such Lender, if any,
to make a Term Loan to the Borrower hereunder in a principal amount not to
exceed the amount set forth under the heading “Term Loan Commitment” under such
Lender’s name on

 

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such Lender’s Addendum.  The original aggregate amount of the Term Loan
Commitments is $65,000,000.

 

“Term Loan Commitment Period”:  the period from and including the Closing Date
to and including the Initial Borrowing Date.

 

“Transferee”:  any Assignee or Participant.

 

“Type”:  as to any Term Loan, its nature as a Base Rate Loan or a Eurodollar
Loan.

 

“United States”:  the United States of America.

 

“Updated Projections”:  the updated projections delivered by the Borrower to the
Lenders in November 2005 in connection with this Agreement.

 

“Voidable Transfer”: as defined in Section 11.16.

 

“Wholly Owned Subsidiary”:  as to any Person, any other Person all of the
Capital Stock of which (other than directors’ qualifying shares required by law
or shares held by nominees as required by law) is owned by such Person directly
and/or through other Wholly Owned Subsidiaries.

 

“Wholly Owned Subsidiary Guarantor”:  any Subsidiary Guarantor that is a Wholly
Owned Subsidiary of the Borrower.

 

1.2.          Other Definitional Provisions.  (a)  Unless otherwise specified
therein, all terms defined in this Agreement shall have the defined meanings
when used in the other Loan Documents or any certificate or other document made
or delivered pursuant hereto or thereto.

 

(b)           As used herein and in the other Loan Documents, and any
certificate or other document made or delivered pursuant hereto or thereto,
(i) accounting terms relating to any Group Member not defined in Section 1.1 and
accounting terms partly defined in Section 1.1, to the extent not defined, shall
have the respective meanings given to them under GAAP, (ii) the words “include,”
“includes” and “including” shall be deemed to be followed by the phrase “without
limitation”, (iii) the word “incur” shall be construed to mean incur, create,
issue, assume, become liable in respect of or suffer to exist (and the words
“incurred” and “incurrence” shall have correlative meanings), (iv) the words
“asset” and “property” (when used in the lower case) 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, Capital Stock, securities, revenues,
accounts, leasehold interests and contract rights, and (v) references to
agreements or other Contractual Obligations shall, unless otherwise specified,
be deemed to refer to such agreements or Contractual Obligations as amended,
supplemented, restated or otherwise modified from time to time (subject to any
applicable restrictions hereunder).

 

(c)           The words “hereof,” “herein” and “hereunder” and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular

 

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provision of this Agreement, and Section, Schedule and Exhibit references are to
this Agreement unless otherwise specified.

 

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

 

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

 

(f)            References herein to fiscal periods ending on March 31, June 30,
September 30 or December 31 during any fiscal year of the Borrower, shall mean
the applicable fiscal period of the Borrower ending on or about such date.

 

SECTION 2.   AMOUNT AND TERMS OF TERM LOAN COMMITMENTS

 

2.1.          Term Loan Commitments.  Subject to the terms and conditions
hereof, each Term Lender severally agrees to make a term loan (a “Term Loan”) to
the Borrower on the Initial Borrowing Date in an amount equal to the amount of
the Term Loan Commitment of such Lender, provided that at the end of the last
day of the Term Loan Commitment Period, the Term Loan Commitment of each Term
Lender, if any, shall automatically be reduced to zero.  The Term Loans shall be
made in a single drawing and shall be made on the Initial Borrowing Date.  The
Term Loans may from time to time be Eurodollar Loans or Base Rate Loans, as
determined by the Borrower and notified to the Administrative Agent in
accordance with Sections 2.2 and 4.3.

 

2.2.          Procedure for Term Loan Borrowing.  The Borrower has informed the
Administrative Agent, the Lead Arranger and the Lenders that, in the connection
with the consummation of the Refinancing, it will require that the Term Loans be
made available to it prior to 10 A.M., New York City time, on the Initial
Borrowing Date.  In that connection, the Borrower has requested that each Lender
make available to the Lead Arranger on the Business Day preceding the
anticipated Initial Borrowing Date (such preceding date, the “Pre-Funding Date”)
an amount in immediately available funds equal to the Term Loan or Term Loans to
be made by such Lender on the Initial Borrowing Date (it being understood that
the Lenders in making available such funds to the Lead Arranger shall not be
deemed to have made the Term Loans and the Term Loans shall only be made on the
Initial Borrowing Date following receipt of the notice referred to in the
immediately following sentence, and the satisfaction of the conditions set forth
in Section 6.2).  The Borrower shall notify the Lead Arranger and the
Administrative Agent of the anticipated Initial Borrowing Date at least two
Business Days prior to the occurrence thereof and shall give them a notice
specifying (i) the amount and Type of

 

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Term Loans to be borrowed, (ii) the anticipated date of the Initial Borrowing
Date and (iii) the respective amounts of each such Type of Term Loan and the
respective lengths of the initial Interest Period therefor.  In the event that,
on the Business Day following the Pre-Funding Date, the Refinancing is not
effected, the Lead Arranger shall return the funds to the Lenders.  In the event
that, on the Business Day following the Pre-Funding Date, the conditions set
forth in Section 6.2 are satisfied, the Lead Arranger shall make available to
the Borrower the aggregate amounts made available to the Lead Arranger by the
Term Lenders in immediately available funds in accordance with the irrevocable
instructions provided by the Borrower in connection with its notice of
borrowing.  As consideration for the Lenders making available their funds on the
Pre-Funding Date as contemplated by this Section, the Borrower agrees to pay to
the Administrative Agent for the account of the Lenders an amount equal to the
amount that would have accrued on such amounts had such amounts been used to
make Term Loans that are Base Rate Loans under this Agreement on the Pre-Funding
Date (assuming such Term Loans were repaid on the Initial Borrowing Date or, if
such funds are repaid to the Lenders, on the Business Day on which such funds
are repaid to the Lenders).  Interest pursuant to the immediately preceding
sentence shall be paid (a) in the event funds are returned to the Lenders as
contemplated by this Section on the date such funds are returned and (b) in the
event the Refinancing is effected on the Business Day following the Pre-Funding
Date, on March 31, 2006.

 

2.3.          Repayment of Term Loans.  The Term Loan of each Lender shall be
repayable in full in a single installment on the date that is six years after
the Initial Borrowing Date, provided that, if the Borrower has not, on or prior
to March 30, 2009, either (i) extended the mandatory redemption date of the
Series Z Preferred to a date that is on or after the date that is six years and
six months after the Closing Date or (ii) redeemed all the outstanding Series Z
Preferred with the proceeds of an issuance of Replacement Equity, the Borrower
shall repay the remaining outstanding balance of the Term Loans on March 30,
2009, provided, that in the event that the mandatory redemption date of the
Series Z Preferred is extended after the date hereof, then the reference to
March 30, 2009 shall be deemed to be a reference to the date which is one fiscal
quarter prior to the then effective mandatory redemption date of the Series Z
Preferred (it being understood, for the avoidance of doubt, that, for purposes
of this proviso, any extension of the scheduled redemption date of the Series Z
Preferred must be effective and not subject to any conditions (which have not
been satisfied) or acceleration provisions).

 

SECTION 3.   [RESERVED]

 

SECTION 4.   GENERAL PROVISIONS APPLICABLE TO TERM LOANS

 

4.1.          Optional Prepayments.  (a)  The Borrower may at any time and from
time to time prepay the Term Loans, in whole or in part without premium or
penalty, except as expressly provided in the last sentence of this
Section 4.1(a) upon irrevocable notice delivered to the Administrative Agent no
later than 11:00 A.M., New York City time, three Business Days prior thereto, in
the case of Eurodollar Loans, and no later than 11:00 A.M., New York City time,
one Business Day prior thereto, in the case of Base Rate Loans, which notice
shall specify the date and amount of prepayment and whether the prepayment is of
Eurodollar Loans or Base Rate Loans; provided that, if a Eurodollar Loan is
prepaid on any day other than the last day of the Interest Period applicable
thereto, the Borrower shall also pay any amounts owing pursuant

 

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to Section 4.11.  Upon receipt of any such notice the Administrative Agent shall
promptly notify each relevant Lender thereof.  If any such notice is given, the
amount specified in such notice shall be due and payable on the date specified
therein, together with accrued interest to such date on the amount prepaid. 
Partial prepayments of Term Loans shall be in an aggregate principal amount of
$1,000,000 or a whole multiple thereof.  Each optional prepayment in respect of
the Term Loans on or prior to the second anniversary of the Initial Borrowing
Date shall be accompanied by a prepayment premium equal to (i) if such
prepayment is made on or prior to the first anniversary of the Initial Borrowing
Date, 2% of the principal amount of such prepayment and (ii) if such prepayment
is made after the first anniversary of the Initial Borrowing Date and on or
prior to the second anniversary of the Initial Borrowing Date, 1% of the
principal amount of such prepayment.

 

4.2.          Mandatory Prepayments and Term Loan Commitment Reductions . 
(a)  If any Capital Stock shall be issued by any Group Member (other than
(i) any Capital Stock issued to any Group Member or the Permitted Investors,
(ii) any Replacement Equity, (iii) so long as (A) the Consolidated Leverage
Ratio at such time and after giving effect thereto is equal to or less than 3.25
to 1.00 and (B) no Default or Event of Default shall have occurred and be
continuing or would result therefrom, any issuance of common stock of the
Borrower to the extent the Net Cash Proceeds thereof are used to concurrently
permanently prepay the Subordinated Loans or any Permitted Refinancing
Indebtedness pursuant to Section 8.2(c) or (iv) any issuance of Capital Stock to
the extent the Net Cash Proceeds thereof are used to prepay First Lien Term
Loans or to permanently reduce the Revolving Commitments (as defined in the
First Lien Credit Agreement) pursuant to Section 4.2 of the First Lien Credit
Agreement or to permanently repay or reduce the Permitted Refinancing
Indebtedness permitted under Section 8.2(b)), or any capital contribution is
made to any Group Member (other than a capital contribution by any Group Member
or the Permitted Investors), an amount equal to 50% of the Net Cash Proceeds
thereof shall be applied on the date of receipt of such Net Cash Proceeds toward
the prepayment of the Term Loans; provided, that, if a Default exists at the
time Net Cash Proceeds are received by the Borrower, but such Default is cured
before it becomes an Event of Default, such Default shall not operate to
prohibit the application of such Net Cash Proceeds as specified in clause
(iii) above once such Default has been cured; provided, further, that during the
continuance of such Default prior to the time such Default becomes an Event of
Default, such Net Cash Proceeds shall be deposited and maintained in a
segregated account with the Administrative Agent and shall not be required to be
used for the repayment of the Term Loans during such time notwithstanding any
provision of this Section 4.2(a) to the contrary.

 

(b)           If any Indebtedness shall be incurred by any Group Member (other
than Excluded Indebtedness), an amount equal to 100% of the Net Cash Proceeds
thereof shall be applied on the date of such incurrence toward the prepayment of
the Term Loans.

 

(c)           If on any date any Group Member shall receive Net Cash Proceeds
from any Asset Sale or Recovery Event then, unless a Reinvestment Notice shall
be delivered in respect thereof, such Net Cash Proceeds shall be applied on such
date toward the prepayment of the Term Loans; provided, that, notwithstanding
the foregoing, on each Reinvestment Prepayment Date, an amount equal to the
Reinvestment Prepayment Amount with respect to the relevant Reinvestment Event
shall be applied toward the prepayment of the Term Loans.

 

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(d) If, for any fiscal year of the Borrower commencing with the fiscal year
ending December 31, 2006, there shall be Excess Cash Flow, the Borrower shall,
on the relevant Excess Cash Flow Application Date, apply the ECF Percentage of
such Excess Cash Flow toward the prepayment of the Term Loans, provided that any
required prepayment pursuant to this Section 4.2(d) will be reduced to the
extent necessary so that, after giving effect to the prepayment (if any)
required under this Section 4.2(d), the aggregate amount of cash and Cash
Equivalents of the Borrower and its Subsidiaries (other than any such cash or
Cash Equivalents which are subject to a Lien permitted by Section 8.3 or
constitute “restricted cash” in accordance with GAAP) as of the last day of the
relevant fiscal year will not be less than $5,000,000.  Each such prepayment and
commitment reduction shall be made on a date (an “Excess Cash Flow Application
Date”) no later than five days after the earlier of (i) the date on which the
financial statements of the Borrower referred to in Section 7.1(a), for the
fiscal year with respect to which such prepayment is made, are required to be
delivered to the Lenders and (ii) the date such financial statements are
actually delivered.

 

(e) The application of any prepayment pursuant to Section 4.2 shall be made,
first, to Base Rate Loans and, second, to Eurodollar Loans.  Each prepayment of
the Loans under Section 4.2 shall be accompanied by accrued interest to the date
of such prepayment on the amount prepaid.

 

(f) Notwithstanding anything to the contrary in this Agreement, the amount of
any mandatory repayment of Term Loans required pursuant to Sections 4.2(a),
4.2(b), 4.2(c) or 4.2(d) of this Agreement shall be reduced by the aggregate
amount by which the First Lien Term Loans have been prepaid and/or the Revolving
Commitments (as defined in the First Lien Credit Agreement) have been reduced
pursuant to Section 4.2 of the First Lien Credit Agreement or loans have been
permanently prepaid or commitments permanently reduced with respect to Permitted
Refinancing Indebtedness permitted under Section 8.2(b).

 

4.3.          Conversion and Continuation Options.  (a)  The Borrower may elect
from time to time to convert Eurodollar Loans to Base Rate Loans by giving the
Administrative Agent prior irrevocable notice of such election no later than
11:00 A.M., New York City time, on the Business Day preceding the proposed
conversion date, provided that any such conversion of Eurodollar Loans may only
be made on the last day of an Interest Period with respect thereto.  The
Borrower may elect from time to time to convert Base Rate Loans to Eurodollar
Loans by giving the Administrative Agent prior irrevocable notice of such
election no later than 11:00 A.M., New York City time, on the third Business Day
preceding the proposed conversion date (which notice shall specify the length of
the initial Interest Period therefor), provided that no Base Rate Loan may be
converted into a Eurodollar Loan when any Event of Default has occurred and is
continuing and the Administrative Agent or the Required Lenders have determined
in its or their sole discretion not to permit such conversions.  Upon receipt of
any such notice the Administrative Agent shall promptly notify each relevant
Lender thereof.

 

(b) Any Eurodollar Loan may be continued as such upon the expiration of the then
current Interest Period with respect thereto by the Borrower giving irrevocable
notice to the Administrative Agent, in accordance with the applicable provisions
of the term “Interest Period” set forth in Section 1.1, of the length of the
next Interest Period to be applicable to such Term Loans, provided that no
Eurodollar Loan may be continued as such when any Event of Default

 

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has occurred and is continuing and the Administrative Agent has or the Required
Lenders have determined in its or their sole discretion not to permit such
continuations, and provided, further, that if the Borrower shall fail to give
any required notice as described above in this paragraph or if such continuation
is not permitted pursuant to the preceding proviso such Term Loans shall be
automatically converted to Base Rate Loans on the last day of such then expiring
Interest Period.  Upon receipt of any such notice the Administrative Agent shall
promptly notify each relevant Lender thereof.

 

4.4.          Limitations on Eurodollar Tranches.  Notwithstanding anything to
the contrary in this Agreement, all borrowings, conversions and continuations of
Eurodollar Loans hereunder and all selections of Interest Periods hereunder
shall be in such amounts and be made pursuant to such elections so that,
(a) after giving effect thereto, the aggregate principal amount of the
Eurodollar Loans comprising each Eurodollar Tranche shall be equal to $1,000,000
or a whole multiple of $250,000 in excess thereof and (b) no more than eight
Eurodollar Tranches shall be outstanding at any one time.

 

4.5.          Interest Rates and Payment Dates.  (a)  Each Eurodollar Loan shall
bear interest for each day during each Interest Period with respect thereto at a
rate per annum equal to the Eurodollar Rate determined for such day plus the
Applicable Margin.

 

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

 

(c) (i)  If all or a portion of the principal amount of any Term Loan shall not
be paid when due (whether at the stated maturity, by acceleration or otherwise),
such overdue amount shall bear interest at a rate per annum equal to the rate
that would otherwise be applicable thereto pursuant to the foregoing provisions
of this Section plus 2%, and (ii) if all or a portion of any interest payable on
any Term Loan or any commitment fee or other amount payable hereunder shall not
be paid when due (whether at the stated maturity, by acceleration or otherwise),
such overdue amount shall bear interest at a rate per annum equal to the rate
then applicable to Base Rate Loans plus 2%, in each case, with respect to
clauses (i) and (ii) above, from the date of such non-payment until such amount
is paid in full (as well after as before judgment).

 

(d) Interest shall be payable in arrears on each Interest Payment Date, provided
that interest accruing pursuant to paragraph (c) of this Section shall be
payable from time to time on demand.

 

4.6.          Computation of Interest and Fees.  (a)  Interest and fees payable
pursuant hereto shall be calculated on the basis of a 360-day year for the
actual days elapsed.  The Administrative Agent shall as soon as practicable
notify the Borrower and the relevant Lenders of each determination of a
Eurodollar Rate.  Any change in the interest rate on a Term Loan resulting from
a change in the Base Rate or the Eurocurrency Reserve Requirements shall become
effective as of the opening of business on the day on which such change becomes
effective.  The Administrative Agent shall as soon as practicable notify the
Borrower and the relevant Lenders of the effective date and the amount of each
such change in interest rate.

 

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(b) Each determination of an interest rate by the Administrative Agent pursuant
to any provision of this Agreement shall be conclusive and binding on the
Borrower and the Lenders in the absence of manifest error.  The Administrative
Agent shall, at the request of the Borrower, deliver to the Borrower a statement
showing the quotations used by the Administrative Agent in determining any
interest rate pursuant to Section 4.5(a).

 

4.7.          Inability to Determine Interest Rate.  If prior to the first day
of any Interest Period:

 

(A) THE ADMINISTRATIVE AGENT SHALL HAVE DETERMINED (WHICH DETERMINATION SHALL BE
CONCLUSIVE AND BINDING UPON THE BORROWER) THAT, BY REASON OF CIRCUMSTANCES
AFFECTING THE RELEVANT MARKET, ADEQUATE AND REASONABLE MEANS DO NOT EXIST FOR
ASCERTAINING THE EURODOLLAR RATE FOR SUCH INTEREST PERIOD, OR

 

(B) THE ADMINISTRATIVE AGENT SHALL HAVE RECEIVED NOTICE FROM THE REQUIRED
LENDERS THAT THE EURODOLLAR RATE DETERMINED OR TO BE DETERMINED FOR SUCH
INTEREST PERIOD WILL NOT ADEQUATELY AND FAIRLY REFLECT THE COST TO SUCH LENDERS
(AS CONCLUSIVELY CERTIFIED BY SUCH LENDERS) OF MAKING OR MAINTAINING THEIR
AFFECTED TERM LOANS DURING SUCH INTEREST PERIOD,

 

the Administrative Agent shall give telecopy or telephonic notice thereof to the
Borrower and the Lenders as soon as practicable thereafter.  If such notice is
given (x) any Eurodollar Loans requested to be made on the first day of such
Interest Period shall be made as Base Rate Loans, (y) any Term Loans that were
to have been converted on the first day of such Interest Period to Eurodollar
Loans shall be continued as Base Rate Loans and (z) any outstanding Eurodollar
Loans shall be converted, on the last day of the then-current Interest Period,
to Base Rate Loans.  Until such notice has been withdrawn by the Administrative
Agent, no further Eurodollar Loans shall be made or continued as such, nor shall
the Borrower have the right to convert Term Loans to Eurodollar Loans.

 

4.8.          Pro Rata Treatment and Payments.  (a)  Each borrowing by the
Borrower from the Lenders hereunder, each payment by the Borrower on account of
any commitment fee and any reduction of the Term Loan Commitments of the Lenders
shall be made pro rata according to the respective Term Percentages of the
Lenders.

 

(b) Each payment (including each prepayment) by the Borrower on account of
principal of and interest on the Term Loans shall be made pro rata according to
the respective outstanding principal amounts of the Term Loans then held by the
Term Lenders.  Amounts prepaid on account of the Term Loans may not be
reborrowed.

 

(c) [Reserved]

 

(d) All payments (including prepayments) to be made by the Borrower hereunder,
whether on account of principal, interest, fees or otherwise, shall be made
without setoff or counterclaim and shall be made prior to 12:00 Noon,
New York City time, on the due date thereof to the Administrative Agent, for the
account of the Lenders, at the Funding Office, in Dollars and in immediately
available funds.  The Administrative Agent shall distribute such payments to the
Lenders promptly upon receipt in like funds as received.  If any payment

 

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hereunder (other than payments on the Eurodollar Loans) becomes due and payable
on a day other than a Business Day, such payment shall be extended to the next
succeeding Business Day.  If any payment on a Eurodollar Loan becomes due and
payable on a day other than a Business Day, the maturity thereof shall be
extended to the next succeeding Business Day unless the result of such extension
would be to extend such payment into another calendar month, in which event such
payment shall be made on the immediately preceding Business Day.  In the case of
any extension of any payment of principal pursuant to the preceding two
sentences, interest thereon shall be payable at the then applicable rate during
such extension.

 

(e) Unless the Administrative Agent shall have been notified in writing by any
Lender prior to a borrowing that such Lender will not make the amount that would
constitute its share of such borrowing available to the Administrative Agent,
the Administrative Agent may assume that such Lender is making such amount
available to the Administrative Agent, and the Administrative Agent may, in
reliance upon such assumption, make available to the Borrower a corresponding
amount.  If such amount is not made available to the Administrative Agent by the
required time on the Borrowing Date therefor, such Lender shall pay to the
Administrative Agent, on demand, such amount with interest thereon at a rate
equal to the greater of (i) the Federal Funds Effective Rate and (ii) a rate
determined by the Administrative Agent in accordance with banking industry
rules on interbank compensation for the period until such Lender makes such
amount immediately available to the Administrative Agent.  A certificate of the
Administrative Agent submitted to any Lender with respect to any amounts owing
under this paragraph shall be conclusive in the absence of manifest error.  If
such Lender’s share of such borrowing is not made available to the
Administrative Agent by such Lender within three Business Days of such Borrowing
Date, the Administrative Agent shall also be entitled to recover such amount
with interest thereon at the rate per annum applicable to Base Rate Loans, on
demand, from the Borrower.

 

(f) Unless the Administrative Agent shall have been notified in writing by the
Borrower prior to the date of any payment due to be made by the Borrower
hereunder that the Borrower will not make such payment to the Administrative
Agent, the Administrative Agent may assume that the Borrower is making such
payment, and the Administrative Agent may, but shall not be required to, in
reliance upon such assumption, make available to the Lenders their respective
pro rata shares of a corresponding amount.  If such payment is not made to the
Administrative Agent by the Borrower within three Business Days after such due
date, the Administrative Agent shall be entitled to recover, on demand, from
each Lender to which any amount which was made available pursuant to the
preceding sentence, such amount with interest thereon at the rate per annum
equal to the daily average Federal Funds Effective Rate.  Nothing herein shall
be deemed to limit the rights of the Administrative Agent or any Lender against
the Borrower.

 

4.9.          Requirements of Law.  (a)  If the adoption of or any change in any
Requirement of Law or in the interpretation or application thereof or compliance
by any Lender with any request or directive (whether or not having the force of
law) from any central bank or other Governmental Authority made subsequent to
the date hereof:

 

(i)            shall subject any Lender to any tax of any kind whatsoever with
respect to this Agreement or any Eurodollar Loan made by it, or change the basis

 

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of taxation of payments to such Lender in respect thereof (except for
Non-Excluded Taxes covered by Section 4.10 and except for any tax on the overall
net income of such Lender);

 

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

 

(iii)          shall impose on such Lender any other condition (except for
Non-Excluded Taxes covered by Section 4.10 and changes in the rate of tax on the
overall net income of such Lender);

 

and the result of any of the foregoing is to increase the cost to such Lender,
by an amount that such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans, or to reduce any amount receivable
hereunder in respect thereof, then, in any such case, the Borrower shall
promptly pay such Lender, upon its demand, any additional amounts necessary to
compensate such Lender for such increased cost or reduced amount receivable.  If
any Lender becomes entitled to claim any additional amounts pursuant to this
paragraph, it shall promptly notify the Borrower (with a copy to the
Administrative Agent) of the event by reason of which it has become so entitled.

 

(b) If any Lender shall have determined that the adoption of or any change in
any Requirement of Law regarding capital adequacy or in the interpretation or
application thereof or compliance by such Lender or any corporation controlling
such Lender with any request or directive regarding capital adequacy (whether or
not having the force of law) from any Governmental Authority made subsequent to
the date hereof shall have the effect of reducing the rate of return on such
Lender’s or such corporation’s capital as a consequence of its obligations
hereunder to a level below that which such Lender or such corporation could have
achieved but for such adoption, change or compliance (taking into consideration
such Lender’s or such corporation’s policies with respect to capital adequacy)
by an amount deemed by such Lender to be material, then from time to time, after
submission by such Lender to the Borrower (with a copy to the Administrative
Agent) of a written request therefor, the Borrower shall pay to such Lender such
additional amount or amounts as will compensate such Lender or such corporation
for such reduction.

 

(c) A Lender shall be required to submit a certificate as to any additional
amounts payable pursuant to this Section, and any such certificate submitted by
any Lender to the Borrower (with a copy to the Administrative Agent) shall be
conclusive in the absence of manifest error.  Notwithstanding anything to the
contrary in this Section, the Borrower shall not be required to compensate a
Lender pursuant to this Section for any amounts incurred more than six months
prior to the date that such Lender notifies the Borrower of such Lender’s
intention to claim compensation therefor; provided that, if the circumstances
giving rise to such claim have a retroactive effect, then such six-month period
shall be extended to include the period of such retroactive effect.  The
obligations of the Borrower pursuant to this Section shall survive the

 

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termination of this Agreement and the payment of the Term Loans and all other
amounts payable hereunder.

 

4.10.        Taxes.  (a)  All payments made by the Borrower under this Agreement
shall be made free and clear of, and without deduction or withholding for or on
account of, any present or future income, stamp or other taxes, levies, imposts,
duties, charges, fees, deductions or withholdings, now or hereafter imposed,
levied, collected, withheld or assessed by any Governmental Authority, excluding
net income taxes and franchise taxes (imposed in lieu of net income taxes)
imposed on any Agent or any Lender as a result of a present or former connection
between such Agent or such Lender and the jurisdiction of the Governmental
Authority imposing such tax or any political subdivision or taxing authority
thereof or therein (other than any such connection arising solely from such
Agent or such Lender having executed, delivered or performed its obligations or
received a payment under, or enforced, this Agreement or any other Loan
Document).  If any such non-excluded taxes, levies, imposts, duties, charges,
fees, deductions or withholdings (“Non-Excluded Taxes”) or Other Taxes are
required to be withheld from any amounts payable to any Agent or any Lender
hereunder, the amounts so payable to such Agent or such Lender shall be
increased to the extent necessary to yield to such Agent or such Lender (after
payment of all Non-Excluded Taxes and Other Taxes) interest or any such other
amounts payable hereunder at the rates or in the amounts specified in this
Agreement, provided, however, that the Borrower shall not be required to
increase any such amounts payable to any Lender with respect to any Non-Excluded
Taxes (i) that are attributable to such Lender’s failure to comply with the
requirements of paragraph (d) or (e) of this Section or (ii) that are
United States withholding taxes imposed on amounts payable to such Lender at the
time such Lender becomes a party to this Agreement, except to the extent that
such Lender’s assignor (if any) was entitled, at the time of assignment, to
receive additional amounts from the Borrower with respect to such Non-Excluded
Taxes pursuant to this paragraph.

 

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

 

(c) Whenever any Non-Excluded Taxes or Other Taxes are payable by the Borrower,
as promptly as possible thereafter the Borrower shall send to the Administrative
Agent for its own account or for the account of the relevant Agent or Lender, as
the case may be, a certified copy of an original official receipt received by
the Borrower showing payment thereof.  If the Borrower fails to pay any
Non-Excluded Taxes or Other Taxes when due to the appropriate taxing authority
or fails to remit to the Administrative Agent the required receipts or other
required documentary evidence, the Borrower shall indemnify the Agents and the
Lenders for any incremental taxes, interest or penalties that may become payable
by any Agent or any Lender as a result of any such failure.

 

(d) Each Lender (or Transferee) that is not a “U.S. Person” as defined in
Section 7701(a)(30) of the Code (a “Non-U.S. Lender”) shall deliver to the
Borrower and the Administrative Agent (or, in the case of a Participant, to the
Lender from which the related participation shall have been purchased) two
copies of either U.S. Internal Revenue Service Form W-8BEN or Form W-8ECI, or,
in the case of a Non-U.S. Lender claiming exemption from U.S. federal
withholding tax under Section 871(h) or 881(c) of the Code with respect to
payments of “portfolio interest”, a statement substantially in the form of
Exhibit F and a

 

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Form W-8BEN, or any subsequent versions thereof or successors thereto, properly
completed and duly executed by such Non-U.S. Lender claiming complete exemption
from, or a reduced rate of, U.S. federal withholding tax on all payments by the
Borrower under this Agreement and the other Loan Documents.  Such forms shall be
delivered by each Non-U.S. Lender on or before the date it becomes a party to
this Agreement (or, in the case of any Participant, on or before the date such
Participant purchases the related participation).  In addition, each Non-U.S.
Lender shall deliver such forms promptly upon the obsolescence or invalidity of
any form previously delivered by such Non-U.S. Lender.  Each Non-U.S. Lender
shall promptly notify the Borrower at any time it determines that it is no
longer in a position to provide any previously delivered certificate to the
Borrower (or any other form of certification adopted by the U.S. taxing
authorities for such purpose).  Notwithstanding any other provision of this
paragraph, a Non-U.S. Lender shall not be required to deliver any form pursuant
to this paragraph that such Non-U.S. Lender is not legally able to deliver.

 

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

 

(f) The agreements in this Section shall survive the termination of this
Agreement and the payment of the Term Loans and all other amounts payable
hereunder.

 

4.11.        Indemnity.  The Borrower agrees to indemnify each Lender and to
hold each Lender harmless from any loss or expense that such Lender may sustain
or incur as a consequence of (a) default by the Borrower in making a borrowing
of, conversion into or continuation of Eurodollar Loans after the Borrower has
given a notice requesting the same in accordance with the provisions of this
Agreement, (b) default by the Borrower in making any prepayment of or conversion
from Eurodollar Loans after the Borrower has given a notice thereof in
accordance with the provisions of this Agreement or (c) the making of a
prepayment of Eurodollar Loans on a day that is not the last day of an Interest
Period with respect thereto.  Such indemnification may include an amount equal
to the excess, if any, of (i) the amount of interest that would have accrued on
the amount so prepaid, or not so borrowed, converted or continued, for the
period from the date of such prepayment or of such failure to borrow, convert or
continue to the last day of such Interest Period (or, in the case of a failure
to borrow, convert or continue, the Interest Period that would have commenced on
the date of such failure) in each case at the applicable rate of interest for
such Term Loans provided for herein (excluding, however, the Applicable Margin
included therein, if any) over (ii) the amount of interest (as reasonably
determined by such Lender) that would have accrued to such Lender on such amount
by placing such amount on deposit for a comparable period with leading banks in
the interbank eurodollar market.  A Lender must provide a certificate as to any
amounts payable pursuant to this Section, and any such certificate submitted to
the Borrower by any Lender shall be conclusive in the

 

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absence of manifest error.  This covenant shall survive the termination of this
Agreement and the payment of the Term Loans and all other amounts payable
hereunder.

 

4.12.        Change of Lending Office.  Each Lender agrees that, upon the
occurrence of any event giving rise to the operation of Section 4.9 or
4.10(a) with respect to such Lender, it will, if requested by the Borrower, use
reasonable efforts (subject to overall policy considerations of such Lender) to
designate another lending office for any Term Loans affected by such event with
the object of avoiding the consequences of such event; provided, that no such
designation shall be required unless such designation can be made on terms that,
in the sole judgment of such Lender, cause such Lender and its lending office(s)
to suffer no economic, legal or regulatory disadvantage, and provided, further,
that nothing in this Section shall affect or postpone any of the obligations of
the Borrower or the rights of any Lender pursuant to Section 4.9 or 4.10(a).

 

4.13.        Replacement of Lenders.  The Borrower shall be permitted to replace
any Lender that (a) requests reimbursement for amounts owing pursuant to
Section 4.9 or 4.10(a) or (b) defaults in its obligation to make Term Loans
hereunder (a “Defaulting Lender”), with a replacement financial institution;
provided that (i) such replacement does not conflict with any Requirement of
Law, (ii) no Event of Default shall have occurred and be continuing at the time
of such replacement, (iii) prior to any such replacement, such Lender shall have
failed to take the actions required to be taken by such Lender under
Section 4.12 so as to eliminate the continued need for payment of amounts owing
pursuant to Section 4.9 or 4.10(a), (iv) the replacement financial institution
shall purchase, at par, all Term Loans and other amounts owing to such replaced
Lender on or prior to the date of replacement, (v) the Borrower shall be liable
to such replaced Lender under Section 4.11 if any Eurodollar Loan owing to such
replaced Lender shall be purchased other than on the last day of the Interest
Period relating thereto, (vi) the replacement financial institution, if not
already a Lender, shall be reasonably satisfactory to the Administrative Agent,
(vii) the replaced Lender shall be obligated to make such replacement in
accordance with the provisions of Section 11.6 (provided that the Borrower shall
be obligated to pay the registration and processing fee referred to therein),
(viii) until such time as such replacement shall be consummated, the Borrower
shall pay all additional amounts (if any) required pursuant to Section 4.9 or
4.10(a), as the case may be, and (ix) any such replacement shall not be deemed
to be a waiver of any rights that the Borrower, the Administrative Agent or any
other Lender shall have against the replaced Lender.

 

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

 

(b) The Administrative Agent, on behalf of the Borrower, shall maintain the
Register pursuant to Section 11.6(b), and a subaccount therein for each Lender,
in which shall be recorded (i) the amount of each Term Loan made hereunder and
any Note evidencing such Term Loan, the Type of such Term Loan and each Interest
Period applicable thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from the Borrower to each Lender hereunder
and (iii) both the amount of any sum received by the Administrative Agent
hereunder from the Borrower and each Lender’s share thereof.

 

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(c) The entries made in the Register and the accounts of each Lender maintained
pursuant to Section 4.14(a) shall, to the extent permitted by applicable law, be
prima facie evidence of the existence and amounts of the obligations of the
Borrower therein recorded; provided, however, that the failure of any Lender or
the Administrative Agent to maintain the Register or any such account, or any
error therein, shall not in any manner affect the obligation of the Borrower to
repay (with applicable interest) the Term Loans made to the Borrower by such
Lender in accordance with the terms of this Agreement.

 

(d) The Borrower agrees that, upon the request to the Administrative Agent by
any Lender, the Borrower will execute and deliver to such Lender a promissory
note of the Borrower evidencing any Term Loans of such Lender, substantially in
the form of Exhibit G with appropriate insertions as to date and principal
amount.

 

4.15.        Illegality.  Notwithstanding any other provision herein, if the
adoption of or any change in any Requirement of Law or in the interpretation or
application thereof shall make it unlawful for any Lender to make or maintain
Eurodollar Loans as contemplated by this Agreement, (a) the commitment of such
Lender hereunder to make Eurodollar Loans, continue Eurodollar Loans as such and
convert Base Rate Loans to Eurodollar Loans shall forthwith be canceled and
(b) such Lender’s Term Loans then outstanding as Eurodollar Loans, if any, shall
be converted automatically to Base Rate Loans on the respective last days of the
then current Interest Periods with respect to such Term Loans or within such
earlier period as required by law.  If any such conversion of a Eurodollar Loan
occurs on a day which is not the last day of the then current Interest Period
with respect thereto, the Borrower shall pay to such Lender such amounts, if
any, as may be required pursuant to Section 4.11.

 

SECTION 5.   REPRESENTATIONS AND WARRANTIES

 

To induce the Agents and the Lenders to enter into this Agreement and to make
the Term Loans, the Borrower hereby represents and warrants to each Agent and
each Lender that:

 

5.1.          Financial Condition.  (a)  The unaudited pro forma consolidated
balance sheet of the Borrower and its consolidated Subsidiaries as at
September 30, 2005 (including the notes thereto) (the “Pro Forma Balance
Sheet”), copies of which have heretofore been furnished to each Lender, has been
prepared giving effect (as if such events had occurred on such date) to (i) the
consummation of the Refinancing, (ii) the loans to be made on the Initial
Borrowing Date and the use of proceeds thereof and (iii) the payment of fees and
expenses in connection with the foregoing.  The Pro Forma Balance Sheet has been
prepared in good faith and was based upon assumptions which, in light of the
circumstances under which they were made, were believed by the Borrower in good
faith to be reasonable (it being understood that projections by their nature are
inherently uncertain, actual results may differ from projections and such
differences may be material) and presents fairly on a pro forma basis the
estimated financial position of the Borrower and its consolidated Subsidiaries
as at its fiscal quarter ending September 30, 2005, assuming that the events
specified in the preceding sentence had actually occurred at such date.

 

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(b) The audited consolidated balance sheets of the Borrower and its consolidated
Subsidiaries as at December 31, 2003 and December 31, 2004, and the related
consolidated statements of operations, changes in stockholders’ equity and of
cash flows for each of the three years in the period ended December 31, 2004,
reported on by and accompanied by the report from Grant Thornton LLP, present
fairly the consolidated financial condition of the Borrower and its consolidated
Subsidiaries as at such date, and the consolidated results of its operations and
its consolidated cash flows for the respective fiscal years then ended.  The
unaudited consolidated balance sheet of the Borrower and its consolidated
Subsidiaries as at its fiscal quarter ending September 30, 2005, and the related
unaudited consolidated (i) statements of operations and cash flows for the
three-month and year-to-date periods ended on such date and (ii) the statement
of stockholders’ equity for the year-to-date period ended on such date, present
fairly the consolidated financial condition of the Borrower and its consolidated
Subsidiaries as at such date, and the consolidated results of its operations and
its consolidated cash flows for the three-month period then ended (subject to
normal year-end audit adjustments and the absence of footnotes).  All such
financial statements, including the related schedules and notes thereto, have
been prepared in accordance with GAAP applied consistently throughout the
periods involved (except as approved by the aforementioned firm of accountants
and disclosed therein).  No Group Member has any material Guarantee Obligations,
contingent liabilities and liabilities for taxes, or any long-term leases or
unusual forward or long-term commitments, including any interest rate or foreign
currency swap or exchange transaction or other obligation in respect of
derivatives, that are not reflected in the most recent financial statements
referred to in this paragraph.  During the period from December 31, 2004 to and
including the date hereof there has been no Disposition by the Borrower and its
Subsidiaries of any material part of its business or property.

 

5.2.          No Change.  Since December 31, 2004, there has been no development
or event that has had or would reasonably be expected to have a Material Adverse
Effect.

 

5.3.          Corporate Existence; Compliance with Law.  Each Group Member
(a) is duly organized, validly existing and in good standing under the laws of
the jurisdiction of its organization, (b) has the power and authority, and the
legal right, to own and operate its property, to lease the property it operates
as lessee and to conduct the business in which it is currently engaged, (c) is
duly qualified as a foreign corporation and in good standing under the laws of
each jurisdiction where its ownership, lease or operation of property or the
conduct of its business requires such qualification, except, individually or in
the aggregate, where the failure to be so qualified or in good standing could
reasonably not be expected to have, a Material Adverse Effect, and (d) is in
compliance with all Requirements of Law except to the extent that the failure to
comply therewith could not, in the aggregate, reasonably be expected to have a
Material Adverse Effect.

 

5.4.          Power; Authorization; Enforceable Obligations.  Each Loan Party
has the power and authority, and the legal right, to make, deliver and perform
the Loan Documents to which it is a party and, in the case of the Borrower, to
obtain extensions of credit hereunder.  Each Loan Party has taken all necessary
organizational action to authorize the execution, delivery and performance of
the Loan Documents to which it is a party and, in the case of the Borrower, to
authorize the extensions of credit on the terms and conditions of this

 

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Agreement.  No consent or authorization of, filing with, notice to or other act
by or in respect of, any Governmental Authority or any other Person is required
in connection with the Refinancing and the extensions of credit hereunder or
with the execution, delivery, performance, validity or enforceability of this
Agreement or any of the Loan Documents, except (i) consents, authorizations,
filings and notices described in Schedule 5.4, which consents, authorizations,
filings and notices have been obtained or made and are in full force and effect
and (ii) the filings referred to in Section 5.19.  Each Loan Document has been
(or on the Initial Borrowing Date will be) duly executed and delivered on behalf
of each Loan Party party thereto.  This Agreement constitutes, and each other
Loan Document upon execution will constitute, a legal, valid and binding
obligation of each Loan Party party thereto, enforceable against each such Loan
Party in accordance with its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors’ rights generally and by general
equitable principles (whether enforcement is sought by proceedings in equity or
at law).

 

5.5.          No Legal Bar.  The execution, delivery and performance of this
Agreement and the other Loan Documents, the borrowings hereunder and the use of
the proceeds thereof, in each case in accordance with the terms hereof, will not
violate any Requirement of Law or any Contractual Obligation of any Group Member
and will not result in, or require, the creation or imposition of any Lien on
any of their respective properties or revenues pursuant to any Requirement of
Law or any such Contractual Obligation (other than the Liens created by the
Security Documents).

 

5.6.          Litigation.  No litigation, investigation or proceeding of or
before any arbitrator or Governmental Authority is pending or, to the knowledge
of the Borrower, threatened by or against any Group Member or against any of
their respective properties or revenues (a) with respect to any of the Loan
Documents or any of the transactions contemplated hereby or thereby, or (b) that
could reasonably be expected to have a Material Adverse Effect.

 

5.7.          No Default.  No Group Member is in default under or with respect
to any of its Contractual Obligations in any respect that could reasonably be
expected to have a Material Adverse Effect.  No Default or Event of Default has
occurred and is continuing.

 

5.8.          Ownership of Property; Liens.  Each Group Member has title in fee
simple to, or a valid leasehold interest in, all its real property, and good
title to, or a valid leasehold interest in, all its other property, except to
the extent failure to have such title in fee simple to, or valid leasehold
interest in, such property could not reasonably be expected to have a Material
Adverse Effect and none of such property is subject to any Lien except as
permitted by Section 8.3.

 

5.9.          Intellectual Property.  Each Group Member owns, is licensed to use
or is otherwise lawfully permitted to use, all material Intellectual Property
necessary for the conduct of its business as currently conducted; no material
claim has been asserted and is pending by any Person challenging or questioning
the use of any Intellectual Property or the validity or effectiveness of any
Intellectual Property, nor does the Borrower know of any valid basis for any
such claim; and to the knowledge of the Borrower, the use of such Intellectual

 

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Property by each Group Member does not infringe on the rights of any Person in
any material respect.

 

5.10.        Taxes.  Each Group Member has filed or caused to be filed all
Federal, state and other material tax returns that are required to be filed and
has paid all taxes shown to be due and payable on said returns or on any
assessments made against it or any of its property and all other taxes, fees or
other charges imposed on it or any of its property by any Governmental Authority
(other than any the amount or validity of that are currently being contested in
good faith by appropriate proceedings and with respect to which reserves in
conformity with GAAP have been provided on the books of the Borrower or its
Subsidiaries, as the case may be or to the extent the failure to file or pay
could not reasonably be expected to have a Material Adverse Effect); no tax Lien
has been filed, and, to the knowledge of the Borrower, no claim is being
asserted, with respect to any such tax, fee or other charge.

 

5.11.        Federal Regulations.  No part of the proceeds of any Term Loans,
and no other extensions of credit hereunder, will be used for “buying” or
“carrying” any “margin stock” within the respective meanings of each of the
quoted terms under Regulation U as now and from time to time hereafter in effect
or for any purpose that violates the provisions of the Regulations of the
Board.  If requested by any Lender or the Administrative Agent, the Borrower
will furnish to the Administrative Agent and each Lender a statement to the
foregoing effect in conformity with the requirements of FR Form G-3 or
FR Form U-1, as applicable, referred to in Regulation U.

 

5.12.        Labor Matters.  Except as, in the aggregate, could not reasonably
be expected to have a Material Adverse Effect:  (a) there are no strikes or
other labor disputes against any Group Member pending or, to the knowledge of
the Borrower, threatened; (b) hours worked by and payment made to employees of
each Group Member have not been in violation of the Fair Labor Standards Act or
any other applicable Requirement of Law dealing with such matters; and (c) all
payments due from any Group Member on account of employee health and welfare
insurance have been paid or accrued as a liability on the books of the relevant
Group Member.

 

5.13.        ERISA.  Neither a Reportable Event nor an “accumulated funding
deficiency” (within the meaning of Section 412 of the Code or Section 302 of
ERISA) has occurred during the five-year period prior to the date on which this
representation is made or deemed made with respect to any Plan, and each Plan
has complied in all material respects with the applicable provisions of ERISA
and the Code.  No termination of a Single Employer Plan has occurred, and no
Lien in favor of the PBGC or a Plan has arisen, during such five- year period. 
The present value of all accrued benefits under each Single Employer Plan (based
on those assumptions used to fund such Plans) did not, as of the last annual
valuation date prior to the date on which this representation is made or deemed
made, exceed the value of the assets of such Plan allocable to such accrued
benefits by a material amount.  Neither the Borrower nor any Commonly Controlled
Entity has incurred any withdrawal liability under Title IV of ERISA which
remains unsatisfied that would reasonably be expected to have a Material Adverse
Effect and neither the Borrower nor any Commonly Controlled Entity would become
subject to any withdrawal liability under ERISA that would reasonably be
expected to have a Material Adverse Effect if the Borrower or any such Commonly
Controlled Entity were to engage in a complete

 

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withdrawal (as defined in Section 4203 of ERISA) or partial withdrawal (as
defined in Section 4205 of ERISA) from any Multiemployer Plan as of the
valuation date most closely preceding the date on which this representation is
made or deemed made.  No such Multiemployer Plan is in Reorganization or
Insolvent.

 

5.14.        Investment Company Act; Other Regulations.  No Loan Party is an
“investment company”, or a company “controlled” by an “investment company”,
within the meaning of the Investment Company Act of 1940, as amended.  No Loan
Party is subject to regulation under any Requirement of Law (other than
Regulation X of the Board) that limits its ability to incur Indebtedness.

 

5.15.        Subsidiaries.  Except as disclosed to the Administrative Agent by
the Borrower in writing from time to time after the Closing Date,
(a) Schedule 5.15 sets forth the name and jurisdiction of incorporation of each
Subsidiary and, as to each such Subsidiary, the percentage of each class of
Capital Stock owned by any Loan Party and (b) there are no outstanding
subscriptions, options, warrants, calls, rights or other agreements or
commitments (other than stock options granted to employees or directors and
directors’ qualifying shares) of any nature relating to any Capital Stock of any
Subsidiary, except as created by the Loan Documents.

 

5.16.        Use of Proceeds.  The proceeds of the Term Loans shall be used to
finance the Refinancing and to pay related fees and expenses, with any excess to
be available for general corporate purposes.

 

5.17.        Environmental Matters.  Except as, in the aggregate, could not
reasonably be expected to have a Material Adverse Effect:

 

(A) THE FACILITIES AND PROPERTIES OWNED, LEASED OR OPERATED BY ANY GROUP MEMBER
(THE “PROPERTIES”) DO NOT CONTAIN, AND HAVE NOT PREVIOUSLY CONTAINED, ANY
MATERIALS OF ENVIRONMENTAL CONCERN IN AMOUNTS OR CONCENTRATIONS OR UNDER
CIRCUMSTANCES THAT CONSTITUTE OR CONSTITUTED A VIOLATION OF, OR COULD GIVE RISE
TO LIABILITY UNDER, ANY ENVIRONMENTAL LAW;

 

(B) NO GROUP MEMBER HAS RECEIVED OR IS AWARE OF ANY NOTICE OF VIOLATION, ALLEGED
VIOLATION, NON-COMPLIANCE, LIABILITY OR POTENTIAL LIABILITY REGARDING
ENVIRONMENTAL MATTERS OR COMPLIANCE WITH ENVIRONMENTAL LAWS WITH REGARD TO ANY
OF THE PROPERTIES OR THE BUSINESS OPERATED BY ANY GROUP MEMBER (THE “BUSINESS”),
NOR DOES THE BORROWER HAVE KNOWLEDGE OR REASON TO BELIEVE THAT ANY SUCH NOTICE
WILL BE RECEIVED OR IS BEING THREATENED;

 

(C) MATERIALS OF ENVIRONMENTAL CONCERN HAVE NOT BEEN TRANSPORTED OR DISPOSED OF
FROM THE PROPERTIES IN VIOLATION OF, OR IN A MANNER OR TO A LOCATION THAT COULD
GIVE RISE TO LIABILITY UNDER, ANY ENVIRONMENTAL LAW, NOR HAVE ANY MATERIALS OF
ENVIRONMENTAL CONCERN BEEN GENERATED, TREATED, STORED OR DISPOSED OF AT, ON OR
UNDER ANY OF THE PROPERTIES IN VIOLATION OF, OR IN A MANNER THAT COULD GIVE RISE
TO LIABILITY UNDER, ANY APPLICABLE ENVIRONMENTAL LAW;

 

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(D) NO JUDICIAL PROCEEDING OR GOVERNMENTAL OR ADMINISTRATIVE ACTION IS PENDING
OR, TO THE KNOWLEDGE OF THE BORROWER, THREATENED, UNDER ANY ENVIRONMENTAL LAW TO
WHICH ANY GROUP MEMBER IS OR WILL BE NAMED AS A PARTY WITH RESPECT TO THE
PROPERTIES OR THE BUSINESS, NOR ARE THERE ANY CONSENT DECREES OR OTHER DECREES,
CONSENT ORDERS, ADMINISTRATIVE ORDERS OR OTHER ORDERS, OR OTHER ADMINISTRATIVE
OR JUDICIAL REQUIREMENTS OUTSTANDING UNDER ANY ENVIRONMENTAL LAW WITH RESPECT TO
THE PROPERTIES OR THE BUSINESS;

 

(E) THERE HAS BEEN NO RELEASE OR THREAT OF RELEASE OF MATERIALS OF ENVIRONMENTAL
CONCERN AT OR FROM THE PROPERTIES, OR ARISING FROM OR RELATED TO THE OPERATIONS
OF ANY GROUP MEMBER IN CONNECTION WITH THE PROPERTIES OR OTHERWISE IN CONNECTION
WITH THE BUSINESS, IN VIOLATION OF OR IN AMOUNTS OR IN A MANNER THAT COULD GIVE
RISE TO LIABILITY UNDER ENVIRONMENTAL LAWS;

 

(F) THE PROPERTIES AND ALL OPERATIONS AT THE PROPERTIES ARE IN COMPLIANCE, AND
HAVE IN THE LAST FIVE YEARS BEEN IN COMPLIANCE, WITH ALL APPLICABLE
ENVIRONMENTAL LAWS, AND THERE IS NO CONTAMINATION AT, UNDER OR ABOUT THE
PROPERTIES OR VIOLATION OF ANY ENVIRONMENTAL LAW WITH RESPECT TO THE PROPERTIES
OR THE BUSINESS; AND

 

(G) NO GROUP MEMBER HAS ASSUMED ANY LIABILITY OF ANY OTHER PERSON UNDER
ENVIRONMENTAL LAWS.

 

5.18.        Accuracy of Information, etc.  No statement or information
contained in this Agreement, any other Loan Document or any other document,
certificate or statement (other than projections) furnished by or on behalf of
any Loan Party to the Administrative Agent or the Lenders, or any of them, for
use in connection with the transactions contemplated by this Agreement or the
other Loan Documents, when taken as a whole in light of the circumstances under
which it was provided, contained as of the date such statement, information,
document or certificate was so furnished, any untrue statement of a material
fact or omitted to state a material fact necessary to make the statements
contained herein or therein not misleading.  The Updated Projections were
prepared based upon good faith estimates and assumptions that, in light of the
circumstances under which they were made, were believed by management of the
Borrower to be reasonable at the time made, it being recognized by the Lenders
that such financial information as it relates to future events is not to be
viewed as fact and that actual results during the period or periods covered by
such financial information may differ from the projected results set forth
therein by a material amount.

 

5.19.        Security Documents.  (a)  Commencing on the Initial Borrowing Date
and at all times thereafter, the Guarantee and Collateral Agreement is effective
to create in favor of the Administrative Agent, for the benefit of the Secured
Parties, a legal, valid and enforceable security interest in the Collateral
described therein and proceeds thereof.  In the case of the Pledged Stock and
Pledged Notes as described in the Guarantee and Collateral Agreement, when stock
certificates and promissory notes representing such Pledged Stock and Pledged
Notes, respectively, are delivered to the First Lien Administrative Agent, and
in the case of the other Collateral described in the Guarantee and Collateral
Agreement, when financing statements and other filings specified on
Schedule 5.19(a) in appropriate form are filed in the offices specified on
Schedule 5.19(a), the Guarantee and Collateral Agreement shall constitute a
fully perfected first priority (or, prior to the Discharge of First Lien
Obligations (as defined in the Intercreditor

 

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Agreement), second priority) Lien on, and security interest in, all right, title
and interest of the Loan Parties in such Collateral and the proceeds thereof, as
security for the Second Lien Obligations, in each case prior and superior in
right to any other Person (except Liens permitted by Section 8.3).

 

(b) As of the Closing Date and as of the Initial Borrowing Date, neither the
Borrower nor any of its Subsidiaries owns any real property.

 

5.20.        Solvency.  Each Loan Party is, and after giving effect to the
Refinancing and the incurrence of all Indebtedness and obligations being
incurred in connection herewith and therewith will be Solvent.

 

5.21.        Second Lien Obligations.  The Obligations of the Loan Parties under
the Loan Documents constitute Second Lien Obligations (as defined in the
Intercreditor Agreement) and “Designated Senior Indebtedness” of the Borrower
under and as defined in the Subordination Agreement.  The obligations of each
Subsidiary Guarantor under the Guarantee and Collateral Agreement constitute
“Designated Senior Indebtedness” of such Subsidiary Guarantor under and as
defined in the Subordination Agreement.

 

5.22.        Inactive Subsidiaries.  No Inactive Subsidiary is (a) engaged in
any active business or (b) except as disclosed on Part B of Schedule 5.22, owns
any property or assets or has incurred, directly or indirectly, liabilities or
obligations in excess of $100,000 in the aggregate.

 

5.23.        Material Contracts.  All material contracts required to be filed in
connection with the Public Filings under applicable Requirements of Law have
been filed.

 

5.24.        Bank Accounts.  Except as set forth on Schedule 5.24, as of the
Closing Date, neither the Borrower nor any Subsidiary Guarantor maintains any
account (except for accounts the aggregate amount of cash and Cash Equivalents
in which do not exceed $1,000,000 in the aggregate and cash and Cash Equivalents
subject to Liens permitted under Section 8.3).

 

5.25.        Insurance.  Schedule 5.25 lists the insurance maintained by the
Borrower and the Subsidiary Guarantors as of the Closing Date.

 

SECTION 6.   CONDITIONS PRECEDENT

 

6.1.          Conditions to the Closing Date.  The occurrence of the Closing
Date and the effectiveness of this Agreement are subject to the satisfaction of
the following conditions precedent:

 

(A) CREDIT AGREEMENT.  THE ADMINISTRATIVE AGENT AND THE LEAD ARRANGER SHALL HAVE
RECEIVED THIS AGREEMENT, OR, IN THE CASE OF THE LENDERS, AN ADDENDUM, EXECUTED
AND DELIVERED BY EACH AGENT, THE BORROWER AND EACH PERSON THAT IS A LENDER AS OF
THE CLOSING DATE.

 

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(B) FIRST LIEN CREDIT AGREEMENT, SUBORDINATED LOAN AGREEMENT AND INTERCREDITOR
AGREEMENT. THE ADMINISTRATIVE AGENT AND THE LEAD ARRANGER SHALL HAVE RECEIVED
SATISFACTORY EVIDENCE THAT (I) THE FIRST LIEN CREDIT AGREEMENT SHALL HAVE BEEN
DULY EXECUTED AND DELIVERED BY ALL PARTIES THERETO AND THAT THE CLOSING DATE HAS
OCCURRED THEREUNDER, (II) THE SUBORDINATED LOAN AGREEMENT SHALL HAVE BEEN DULY
EXECUTED AND DELIVERED BY ALL PARTIES THERETO AND SHALL HAVE BECOME EFFECTIVE IN
ACCORDANCE WITH ITS TERMS, (III) THE INTERCREDITOR AGREEMENT SHALL HAVE BEEN
DULY EXECUTED AND DELIVERED BY ALL PARTIES THERETO AND SHALL BE IN FULL FORCE
AND EFFECT AND (IV) THE SUBORDINATION AGREEMENT SHALL HAVE BEEN DULY EXECUTED
AND DELIVERED BY ALL PARTIES THERETO AND SHALL BE IN FULL FORCE AND EFFECT (SUCH
SATISFACTION IN EACH CASE EVIDENCED BY THE ADMINISTRATIVE AGENT’S AND THE LEAD
ARRANGER’S EXECUTION OF THIS AGREEMENT).

 

(C) THE SENIOR NOTES.  THE ADMINISTRATIVE AGENT AND THE LEAD ARRANGER SHALL HAVE
RECEIVED SATISFACTORY EVIDENCE THAT THE BORROWER SHALL HAVE ISSUED ON OR PRIOR
TO THE CLOSING DATE AN IRREVOCABLE INSTRUCTION TO THE TRUSTEE FOR THE SENIOR
NOTES DIRECTING THE TRUSTEE TO ISSUE AN IRREVOCABLE NOTICE TO THE HOLDERS OF THE
SENIOR NOTES REDEEMING THE OUTSTANDING PRINCIPAL AMOUNT OF SUCH SENIOR NOTES.

 

(D) CAPITAL STRUCTURE.  THE CAPITAL AND OWNERSHIP STRUCTURE OF THE BORROWER AND
ITS SUBSIDIARIES SHALL BE REASONABLY SATISFACTORY TO THE ADMINISTRATIVE AGENT
AND THE LEAD ARRANGER AFTER GIVING EFFECT TO THE REFINANCING (SUCH SATISFACTION
TO BE EVIDENCED BY THE ADMINISTRATIVE AGENT’S AND THE LEAD ARRANGER’S EXECUTION
OF THIS AGREEMENT).

 

(E) PRO FORMA BALANCE SHEET; FINANCIAL STATEMENTS.  THE LENDERS SHALL HAVE
RECEIVED THE FINANCIAL STATEMENTS DESCRIBED IN SECTION 5.1, AND SUCH FINANCIAL
STATEMENTS SHALL NOT, IN THE REASONABLE JUDGMENT OF THE LENDERS, REFLECT ANY
MATERIAL ADVERSE CHANGE IN THE CONSOLIDATED FINANCIAL CONDITION OF THE BORROWER
AND ITS SUBSIDIARIES, AS REFLECTED IN THE FINANCIAL STATEMENTS OR PROJECTIONS
MOST RECENTLY DELIVERED BY THE BORROWER TO THE ADMINISTRATIVE AGENT AND THE LEAD
ARRANGER (SUCH RECEIPT AND JUDGMENT TO BE EVIDENCED BY EACH LENDER’S EXECUTION
OF THIS AGREEMENT).

 

(F) APPROVALS.  ALL MATERIAL GOVERNMENTAL AND THIRD PARTY APPROVALS NECESSARY IN
CONNECTION WITH THE REFINANCING, THE CONTINUING OPERATIONS OF THE GROUP MEMBERS
AND THE TRANSACTIONS CONTEMPLATED HEREBY SHALL HAVE BEEN OBTAINED AND BE IN FULL
FORCE AND EFFECT.

 

(G) LIEN SEARCHES.  THE ADMINISTRATIVE AGENT AND THE LEAD ARRANGER SHALL HAVE
RECEIVED THE RESULTS OF A RECENT LIEN SEARCH IN EACH OF THE JURISDICTIONS WHERE
THE LOAN PARTIES ARE ORGANIZED, AND SUCH SEARCH SHALL REVEAL NO LIENS ON ANY OF
THE ASSETS OF THE LOAN PARTIES EXCEPT FOR LIENS PERMITTED BY SECTION 8.3 OR TO
BE DISCHARGED ON OR PRIOR TO THE INITIAL BORROWING DATE PURSUANT TO
DOCUMENTATION SATISFACTORY TO THE ADMINISTRATIVE AGENT AND THE LEAD ARRANGER
(SUCH SATISFACTION TO BE EVIDENCED BY THE ADMINISTRATIVE AGENT’S AND THE LEAD
ARRANGER’S EXECUTION OF THIS AGREEMENT).

 

(H) FEES.  THE LENDERS AND THE AGENTS SHALL HAVE RECEIVED ALL FEES THAT ARE THEN
REQUIRED TO BE PAID BY THE BORROWER HEREUNDER OR PREVIOUSLY AGREED TO IN WRITING
BY THE BORROWER AND THE AGENTS.

 

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(I) CLOSING CERTIFICATES.  THE ADMINISTRATIVE AGENT AND THE LEAD ARRANGER SHALL
HAVE RECEIVED (I) A CERTIFICATE OF EACH LOAN PARTY, DATED THE CLOSING DATE,
SUBSTANTIALLY IN THE FORM OF EXHIBIT H, WITH APPROPRIATE INSERTIONS AND
ATTACHMENTS INCLUDING THE CERTIFICATE OF INCORPORATION OF EACH LOAN PARTY (WHICH
WILL INCLUDE, WHERE APPLICABLE, THE CERTIFICATE OF DESIGNATION FOR THE SERIES Z
PREFERRED) THAT IS A CORPORATION CERTIFIED BY THE RELEVANT AUTHORITY OF THE
JURISDICTION OF ORGANIZATION OF SUCH LOAN PARTY, AND (II) A LONG FORM GOOD
STANDING CERTIFICATE FOR EACH LOAN PARTY FROM ITS JURISDICTION OF ORGANIZATION.

 

(J) PATRIOT ACT.  THE LENDERS SHALL HAVE RECEIVED, SUFFICIENTLY IN ADVANCE OF
THE CLOSING DATE, ALL DOCUMENTATION AND OTHER INFORMATION REQUIRED BY BANK
REGULATORY AUTHORITIES UNDER APPLICABLE “KNOW YOUR CUSTOMER” AND ANTI-MONEY
LAUNDERING RULES AND REGULATIONS, INCLUDING WITHOUT LIMITATION THE UNITED STATES
PATRIOT ACT (TITLE III OF PUB. L. 107-56 (SIGNED INTO LAW OCTOBER 26, 2001)), IN
EACH CASE IF REQUESTED BY SUCH LENDER (SUCH SATISFACTION TO BE EVIDENCED BY EACH
LENDER’S EXECUTION OF THIS AGREEMENT).

 

(K) COKE CONTRACT.  THE ADMINISTRATIVE AGENT AND THE LEAD ARRANGER SHALL HAVE
RECEIVED COPIES OF THE COKE BEVERAGE MARKETING AGREEMENT, TOGETHER WITH A
CERTIFICATE OF A RESPONSIBLE OFFICER OF THE BORROWER CERTIFYING SUCH DOCUMENT AS
BEING A TRUE, CORRECT, AND COMPLETE COPY THEREOF.

 

(L) LEGAL OPINIONS.  THE ADMINISTRATIVE AGENT AND THE LEAD ARRANGER SHALL HAVE
RECEIVED THE FOLLOWING EXECUTED LEGAL OPINIONS:

 

(i)            the legal opinion of Holme Roberts & Owen LLP, counsel to the
Borrower and its Subsidiaries, substantially in the form of Exhibit I-1; and

 

(ii)           the legal opinion of local counsel in New Jersey and of such
other special and local counsel as may be reasonably required by the
Administrative Agent.

 

EACH SUCH LEGAL OPINION SHALL COVER SUCH OTHER MATTERS INCIDENT TO THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT AS THE ADMINISTRATIVE AGENT MAY
REASONABLY REQUIRE.

 

6.2.          Conditions to the Initial Borrowing Date.  The agreement of each
Lender to make the initial extension of credit requested to be made by it is
subject to the satisfaction, prior or concurrently with the making of such
extension of credit on the Initial Borrowing Date, of the following conditions
precedent:

 

(A) GUARANTEE AND COLLATERAL AGREEMENTS.  THE ADMINISTRATIVE AGENT AND THE LEAD
ARRANGER SHALL HAVE RECEIVED (I) THE GUARANTEE AND COLLATERAL AGREEMENT,
EXECUTED AND DELIVERED BY THE BORROWER AND EACH SUBSIDIARY GUARANTOR, (II) AN
ACKNOWLEDGMENT AND CONSENT IN THE FORM ATTACHED TO THE GUARANTEE AND COLLATERAL
AGREEMENTS, EXECUTED AND DELIVERED BY EACH ISSUER (AS DEFINED THEREIN), IF ANY,
THAT IS NOT A LOAN PARTY AND (III) THE FIRST LIEN CREDIT DOCUMENTS (EXCEPT TO
THE EXTENT PREVIOUSLY DELIVERED PURSUANT TO SECTION 6.1(B) ABOVE).

 

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(B) FIRST LIEN LOANS.  THE BORROWER SHALL HAVE RECEIVED $80,000,000 IN GROSS
CASH PROCEEDS FROM BORROWINGS OF THE TERM LOANS (AS DEFINED IN THE FIRST LIEN
CREDIT AGREEMENT).

 

(C) SUBORDINATED LOANS.  THE BORROWER SHALL HAVE RECEIVED $24,375,000 IN GROSS
PROCEEDS FROM THE SUBORDINATED LOANS UNDER THE SUBORDINATED LOAN AGREEMENT.

 

(D) EXISTING CREDIT FACILITY.  (I) THE ADMINISTRATIVE AGENT AND THE LEAD
ARRANGER SHALL HAVE RECEIVED OR SHALL CONCURRENTLY RECEIVE SATISFACTORY EVIDENCE
THAT THE EXISTING CREDIT FACILITY SHALL HAVE BEEN TERMINATED AND ALL AMOUNTS
THEREUNDER SHALL HAVE BEEN PAID IN FULL AND (II) SATISFACTORY ARRANGEMENTS SHALL
HAVE BEEN MADE FOR THE TERMINATION OF ALL LIENS GRANTED IN CONNECTION THEREWITH.

 

(E) THE SENIOR NOTES.  (I) THE ADMINISTRATIVE AGENT AND THE LEAD ARRANGER SHALL
HAVE RECEIVED OR SHALL CONCURRENTLY RECEIVE SATISFACTORY EVIDENCE THAT THE
REDEMPTION PRICE FOR ALL SENIOR NOTES OUTSTANDING ON THE INITIAL BORROWING DATE
HAS BEEN IRREVOCABLY DEPOSITED WITH THE TRUSTEE FOR THE SENIOR NOTES AND THE
BORROWER SHALL HAVE DISCHARGED ITS OBLIGATIONS UNDER THE RELATED INDENTURE
(EXCEPT FOR OBLIGATIONS THAT BY THE TERMS THEREOF SURVIVE) AND ALL AMOUNTS
OTHERWISE DUE AND PAYABLE THEREUNDER SHALL HAVE BEEN PAID IN FULL AND
(II) SATISFACTORY ARRANGEMENTS SHALL HAVE BEEN MADE FOR THE TERMINATION OF ALL
LIENS GRANTED IN CONNECTION THEREWITH.

 

(F) LEGAL OPINIONS.  THE ADMINISTRATIVE AGENT AND THE LEAD ARRANGER SHALL HAVE
RECEIVED THE FOLLOWING EXECUTED LEGAL OPINIONS:

 

(i)            the legal opinion of Holme Roberts & Owen LLP, counsel to the
Borrower and its Subsidiaries, substantially in the form of Exhibit I-2; and

 

(ii)           the legal opinion of local counsel in each of Delaware and New
Jersey and of such other special and local counsel as may be reasonably required
by the Administrative Agent.

 

Each such legal opinion shall cover such other matters incident to the
transactions contemplated by this Agreement as the Administrative Agent may
reasonably require.

 

(G) PLEDGED STOCK; STOCK POWERS; PLEDGED NOTES.  THE FIRST LIEN ADMINISTRATIVE
AGENT SHALL HAVE RECEIVED (I) THE CERTIFICATES REPRESENTING THE SHARES OF
CAPITAL STOCK PLEDGED PURSUANT TO THE GUARANTEE AND COLLATERAL AGREEMENT,
TOGETHER WITH AN UNDATED STOCK POWER FOR EACH SUCH CERTIFICATE EXECUTED IN BLANK
BY A DULY AUTHORIZED OFFICER OF THE PLEDGOR THEREOF AND (II) IF REASONABLY
REQUESTED BY THE FIRST LIEN ADMINISTRATIVE AGENT, EACH PROMISSORY NOTE (IF ANY)
PLEDGED TO THE FIRST LIEN ADMINISTRATIVE AGENT PURSUANT TO THE GUARANTEE AND
COLLATERAL AGREEMENT ENDORSED (WITHOUT RECOURSE) IN BLANK (OR ACCOMPANIED BY AN
EXECUTED TRANSFER FORM IN BLANK) BY THE PLEDGOR THEREOF, IN EACH CASE, TO BE
HELD BY THE FIRST LIEN ADMINISTRATIVE AGENT AS BAILEE FOR THE BENEFIT OF THE
SECURED PARTIES (SUBJECT TO THE INTERCREDITOR AGREEMENT).

 

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(H) FILINGS, REGISTRATIONS AND RECORDINGS.  EACH DOCUMENT (INCLUDING ANY UNIFORM
COMMERCIAL CODE FINANCING STATEMENT) REQUIRED BY THE SECURITY DOCUMENTS OR UNDER
LAW OR REASONABLY REQUESTED BY THE ADMINISTRATIVE AGENT AND THE LEAD ARRANGER TO
BE FILED, REGISTERED OR RECORDED IN ORDER TO CREATE IN FAVOR OF THE
ADMINISTRATIVE AGENT, FOR THE BENEFIT OF THE LENDERS, A PERFECTED LIEN ON THE
COLLATERAL DESCRIBED THEREIN, PRIOR AND SUPERIOR IN RIGHT TO ANY OTHER PERSON
(OTHER THAN WITH RESPECT TO LIENS EXPRESSLY PERMITTED BY SECTION 8.3), SHALL BE
IN PROPER FORM FOR FILING, REGISTRATION OR RECORDATION.

 

(I) SOLVENCY CERTIFICATE.  THE ADMINISTRATIVE AGENT AND THE LEAD ARRANGER SHALL
HAVE RECEIVED A SOLVENCY CERTIFICATE FROM THE CHIEF FINANCIAL OFFICER OF THE
BORROWER IN THE FORM OF EXHIBIT M.

 

(J) INSURANCE.  THE ADMINISTRATIVE AGENT AND THE LEAD ARRANGER SHALL HAVE
RECEIVED INSURANCE CERTIFICATES SATISFYING THE REQUIREMENTS OF SECTION 5.3(B) OF
THE GUARANTEE AND COLLATERAL AGREEMENTS.

 

(K) FEES.  THE LENDERS AND THE AGENTS SHALL HAVE RECEIVED ALL FEES THAT ARE THEN
REQUIRED TO BE PAID BY THE BORROWER HEREUNDER OR PREVIOUSLY AGREED TO IN WRITING
BY THE BORROWER AND THE AGENTS, AND ALL EXPENSES WHICH ARE REQUIRED TO BE PAID
BY THE BORROWER HEREUNDER FOR WHICH INVOICES HAVE BEEN PRESENTED (INCLUDING THE
REASONABLE FEES AND EXPENSES OF LEGAL COUNSEL), ON OR BEFORE THE INITIAL
BORROWING DATE.  ALL SUCH AMOUNTS WILL BE PAID OUT OF PROCEEDS OF TERM LOANS
MADE ON THE INITIAL BORROWING DATE AND WILL BE REFLECTED IN THE FUNDING
INSTRUCTIONS GIVEN BY THE BORROWER TO THE ADMINISTRATIVE AGENT ON OR BEFORE THE
INITIAL BORROWING DATE.

 

(L) REQUIRED LIQUIDITY.  THE ADMINISTRATIVE AGENT SHALL HAVE RECEIVED A
CERTIFICATE FROM THE CHIEF FINANCIAL OFFICER CERTIFYING THAT THE SUM OF (I) THE
AVAILABLE REVOLVING COMMITMENTS (AS DEFINED IN THE FIRST LIEN CREDIT AGREEMENT)
ON THE INITIAL BORROWING DATE (AFTER GIVING EFFECT TO THE REFINANCING) AND
(II) THE AGGREGATE UNRESTRICTED AND UNENCUMBERED CASH AND CASH EQUIVALENTS OF
THE BORROWER AND ITS SUBSIDIARIES IS NOT LESS THAN THE SUM OF (X) $6,000,000
LESS (Y) ALL FEES AND EXPENSES PAID TO ANY AGENT OR LENDER (OR ANY AGENT OR
LENDER IN CONNECTION WITH THE FIRST LIEN CREDIT AGREEMENT) PRIOR TO THE INITIAL
BORROWING DATE.

 

6.3.          Additional Conditions to Term Loans.  The agreement of each Lender
to make the Term Loans is subject to the satisfaction of the following
conditions precedent:

 

(A) REPRESENTATIONS AND WARRANTIES.  EACH OF THE REPRESENTATIONS AND WARRANTIES
MADE BY ANY LOAN PARTY IN OR PURSUANT TO THE LOAN DOCUMENTS SHALL BE TRUE AND
CORRECT IN ALL MATERIAL ASPECTS (EXCEPT THAT SUCH MATERIALITY QUALIFIER SHALL
NOT BE APPLICABLE TO ANY REPRESENTATIONS AND WARRANTIES THAT ARE ALREADY
QUALIFIED OR MODIFIED BY MATERIALITY IN THE TEXT THEREOF) ON AND AS OF SUCH DATE
AS IF MADE ON AND AS OF SUCH DATE, EXCEPT TO THE EXTENT SUCH REPRESENTATIONS AND
WARRANTIES RELATED SOLELY TO AN EARLIER DATE, IN WHICH CASE SUCH REPRESENTATIONS
AND WARRANTIES SHALL HAVE BEEN TRUE AND CORRECT IN ALL MATERIAL ASPECTS (EXCEPT
THAT SUCH MATERIALITY QUALIFIER SHALL NOT BE APPLICABLE TO ANY REPRESENTATIONS
AND WARRANTIES THAT ARE ALREADY QUALIFIED OR MODIFIED BY MATERIALITY IN THE TEXT
THEREOF) ON AND AS OF SUCH EARLIER DATE.

 

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(B) NO DEFAULT.  NO DEFAULT OR EVENT OF DEFAULT SHALL HAVE OCCURRED AND BE
CONTINUING ON SUCH DATE OR AFTER GIVING EFFECT TO THE EXTENSIONS OF CREDIT
REQUESTED TO BE MADE ON SUCH DATE.

 

The borrowing by the Borrower hereunder shall constitute a representation and
warranty by the Borrower as of the date of such borrowing that the conditions
contained in this Section 6.3 have been satisfied.

 

SECTION 7.   AFFIRMATIVE COVENANTS

 

The Borrower hereby agrees that, so long as the Term Loan Commitments remain in
effect or any Term Loan or other amount is owing to any Lender or Agent
hereunder, the Borrower shall and shall cause each of its Subsidiaries to:

 

7.1.          Financial Statements.  Furnish to the Administrative Agent and
each Lender:

 

(A) AS SOON AS AVAILABLE, BUT IN ANY EVENT WITHIN 90 DAYS (OR SUCH EARLIER DATE
SPECIFIED FOR THE FILING OF ANNUAL REPORTS ON FORM 10-K UNDER SECTION 13 OF THE
EXCHANGE ACT) AFTER THE END OF EACH FISCAL YEAR OF THE BORROWER, A COPY OF THE
AUDITED CONSOLIDATED BALANCE SHEET OF THE BORROWER AND ITS CONSOLIDATED
SUBSIDIARIES AS AT THE END OF SUCH FISCAL YEAR AND THE RELATED AUDITED
CONSOLIDATED STATEMENTS OF INCOME AND OF CASH FLOWS FOR SUCH FISCAL YEAR,
SETTING FORTH IN EACH CASE IN COMPARATIVE FORM THE FIGURES FOR THE PREVIOUS
FISCAL YEAR, REPORTED ON WITHOUT A “GOING CONCERN” OR LIKE QUALIFICATION OR
EXCEPTION, OR QUALIFICATION ARISING OUT OF THE SCOPE OF THE AUDIT, BY GRANT
THORNTON LLP OR OTHER INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS OF NATIONALLY
RECOGNIZED STANDING;

 

(B) AS SOON AS AVAILABLE, BUT IN ANY EVENT NOT LATER THAN 45 DAYS (OR SUCH
EARLIER DATE SPECIFIED FOR THE FILING OF QUARTERLY REPORTS ON FORM 10-Q UNDER
SECTION 13 OF THE EXCHANGE ACT) AFTER THE END OF EACH OF THE FIRST THREE
QUARTERLY PERIODS OF EACH FISCAL YEAR OF THE BORROWER, THE UNAUDITED
CONSOLIDATED BALANCE SHEET OF THE BORROWER AND ITS CONSOLIDATED SUBSIDIARIES AS
AT THE END OF SUCH QUARTER AND THE RELATED UNAUDITED CONSOLIDATED STATEMENTS OF
INCOME AND OF CASH FLOWS FOR SUCH QUARTER AND THE PORTION OF THE FISCAL YEAR
THROUGH THE END OF SUCH QUARTER, SETTING FORTH IN EACH CASE IN COMPARATIVE FORM
THE FIGURES FOR THE PREVIOUS FISCAL YEAR, CERTIFIED BY A RESPONSIBLE OFFICER AS
BEING FAIRLY STATED IN ALL MATERIAL RESPECTS (SUBJECT TO NORMAL YEAR-END AUDIT
ADJUSTMENTS AND THE ABSENCE OF FOOTNOTES); AND

 

(C) AS SOON AS AVAILABLE, BUT IN ANY EVENT NOT LATER THAN 30 DAYS AFTER THE END
OF EACH MONTH OCCURRING DURING EACH FISCAL YEAR OF THE BORROWER (OTHER THAN THE
THIRD, SIXTH, NINTH AND TWELFTH SUCH MONTH), THE UNAUDITED CONSOLIDATED BALANCE
SHEETS OF THE BORROWER AND ITS SUBSIDIARIES AS AT THE END OF SUCH MONTH AND THE
RELATED UNAUDITED CONSOLIDATED STATEMENTS OF INCOME AND OF CASH FLOWS FOR SUCH
MONTH AND THE PORTION OF THE FISCAL YEAR THROUGH THE END OF SUCH MONTH, SETTING
FORTH IN EACH CASE IN COMPARATIVE FORM THE FIGURES FOR THE PREVIOUS FISCAL YEAR,
CERTIFIED BY A RESPONSIBLE OFFICER AS BEING FAIRLY STATED IN ALL MATERIAL
RESPECTS (SUBJECT TO NORMAL YEAR-END AUDIT ADJUSTMENTS AND THE ABSENCE OF
FOOTNOTES).

 

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All such financial statements shall be complete and correct in all material
respects (subject to normal year-end audit adjustments and the absence of
footnotes, in each case if applicable), and shall be prepared in reasonable
detail and in accordance with GAAP applied consistently throughout the periods
reflected therein and with prior periods (except as approved by such accountants
or officer, as the case may be, and disclosed therein).

 

Information required to be delivered pursuant to this Section 7.1 shall be
deemed to have been delivered to the Lenders on the date on which the Borrower
provides written notice to the Lenders that such information has been posted on
the Borrower’s website on the Internet at http://www. nwrgi.com or is available
on the website of the SEC at http://www.sec.gov (to the extent such information
has been posted or is available as described in such notice).  Information
required to be delivered pursuant to this Section 7.1 may also be delivered by
electronic communication pursuant to procedures approved by the Administrative
Agent pursuant to Section 11.2.

 

7.2.          Certificates; Other Information.  Furnish to the Administrative
Agent and each Lender (or, in the case of clause (f), to the relevant Lender):

 

(A) CONCURRENTLY WITH THE DELIVERY OF ANY FINANCIAL STATEMENTS PURSUANT TO
SECTION 7.1, (I) A CERTIFICATE OF A RESPONSIBLE OFFICER STATING THAT, TO THE
BEST OF EACH SUCH RESPONSIBLE OFFICER’S KNOWLEDGE, EACH LOAN PARTY DURING SUCH
PERIOD HAS OBSERVED OR PERFORMED ALL OF ITS COVENANTS AND OTHER AGREEMENTS, AND
SATISFIED EVERY CONDITION, CONTAINED IN THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS TO WHICH IT IS A PARTY TO BE OBSERVED, PERFORMED OR SATISFIED BY IT,
AND THAT SUCH RESPONSIBLE OFFICER HAS OBTAINED NO KNOWLEDGE OF ANY DEFAULT OR
EVENT OF DEFAULT EXCEPT AS SPECIFIED IN SUCH CERTIFICATE AND (II) IN THE CASE OF
QUARTERLY OR ANNUAL FINANCIAL STATEMENTS, (X) A COMPLIANCE CERTIFICATE
CONTAINING ALL INFORMATION AND CALCULATIONS NECESSARY FOR DETERMINING COMPLIANCE
BY EACH GROUP MEMBER WITH THE PROVISIONS OF THIS AGREEMENT REFERRED TO THEREIN
AS OF THE LAST DAY OF THE FISCAL QUARTER OR FISCAL YEAR OF THE BORROWER, AS THE
CASE MAY BE, AND (Y) TO THE EXTENT NOT PREVIOUSLY DISCLOSED TO THE
ADMINISTRATIVE AGENT, A LISTING OF ANY INTELLECTUAL PROPERTY REGISTERED IN THE
UNITED STATES ACQUIRED BY ANY LOAN PARTY SINCE THE DATE OF THE MOST RECENT LIST
DELIVERED PURSUANT TO THIS CLAUSE (Y) (OR, IN THE CASE OF THE FIRST SUCH LIST SO
DELIVERED, SINCE THE CLOSING DATE);

 

(B) AS SOON AS AVAILABLE, AND IN ANY EVENT NO LATER THAN 45 DAYS AFTER THE END
OF EACH FISCAL YEAR OF THE BORROWER, A DETAILED CONSOLIDATED BUDGET FOR THE
FOLLOWING FISCAL YEAR (INCLUDING A PROJECTED CONSOLIDATED BALANCE SHEET OF THE
BORROWER AND ITS SUBSIDIARIES AS OF THE END OF THE FOLLOWING FISCAL YEAR, THE
RELATED CONSOLIDATED STATEMENTS OF PROJECTED CASH FLOW, PROJECTED CHANGES IN
FINANCIAL POSITION AND PROJECTED INCOME AND A DESCRIPTION OF THE UNDERLYING
ASSUMPTIONS APPLICABLE THERETO), AND, AS SOON AS AVAILABLE, SIGNIFICANT
REVISIONS, IF ANY, OF SUCH BUDGET AND PROJECTIONS WITH RESPECT TO SUCH FISCAL
YEAR (COLLECTIVELY, THE “PROJECTIONS”), WHICH PROJECTIONS SHALL IN EACH CASE BE
ACCOMPANIED BY A CERTIFICATE OF A RESPONSIBLE OFFICER STATING THAT SUCH
PROJECTIONS WERE PREPARED IN GOOD FAITH AND WERE BASED UPON ASSUMPTIONS WHICH,
IN LIGHT OF THE CIRCUMSTANCES UNDER WHICH THEY WERE MADE, WERE BELIEVED BY THE
BORROWER IN GOOD FAITH TO BE REASONABLE AT THE TIME MADE (IT BEING UNDERSTOOD
THAT PROJECTIONS BY THEIR NATURE ARE

 

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INHERENTLY UNCERTAIN, ACTUAL RESULTS MAY DIFFER FROM PROJECTIONS AND SUCH
DIFFERENCES MAY BE MATERIAL);

 

(C) IF THE BORROWER IS NOT THEN A REPORTING COMPANY UNDER THE SECURITIES
EXCHANGE ACT OF 1934, AS AMENDED, WITHIN 45 DAYS AFTER THE END OF EACH FISCAL
QUARTER OF THE BORROWER (OR 90 DAYS, IN THE CASE OF THE LAST FISCAL QUARTER OF
ANY FISCAL YEAR), A NARRATIVE DISCUSSION AND ANALYSIS OF THE FINANCIAL CONDITION
AND RESULTS OF OPERATIONS OF THE BORROWER AND ITS SUBSIDIARIES FOR SUCH FISCAL
QUARTER AND FOR THE PERIOD FROM THE BEGINNING OF THE THEN CURRENT FISCAL YEAR TO
THE END OF SUCH FISCAL QUARTER, AS COMPARED TO THE PORTION OF THE PROJECTIONS
COVERING SUCH PERIODS AND TO THE COMPARABLE PERIODS OF THE PREVIOUS FISCAL YEAR;

 

(D) NO LATER THAN TEN BUSINESS DAYS PRIOR TO THE EFFECTIVENESS THEREOF, COPIES
OF SUBSTANTIALLY FINAL DRAFTS OF ANY PROPOSED AMENDMENT, SUPPLEMENT, WAIVER OR
OTHER MODIFICATION WITH RESPECT TO THE SERIES Z PREFERRED;

 

(E) WITHIN FIVE DAYS AFTER THE SAME ARE SENT, COPIES OF ALL FINANCIAL STATEMENTS
AND REPORTS THAT THE BORROWER SENDS TO THE HOLDERS OF ANY CLASS OF ITS DEBT
SECURITIES OR PUBLIC EQUITY SECURITIES AND, WITHIN FIVE DAYS AFTER THE SAME ARE
FILED, COPIES OF ALL FINANCIAL STATEMENTS AND REPORTS THAT THE BORROWER MAY MAKE
TO, OR FILE WITH, THE SEC; AND

 

(F) PROMPTLY, SUCH ADDITIONAL FINANCIAL AND OTHER INFORMATION AS ANY LENDER MAY
FROM TIME TO TIME REASONABLY REQUEST.

 

7.3.          Payment of Obligations.  Pay, discharge or otherwise satisfy at or
before maturity or before they become delinquent, as the case may be, all its
material obligations of whatever nature, except where the amount or validity
thereof is currently being contested in good faith by appropriate proceedings
and reserves in conformity with GAAP with respect thereto have been provided on
the books of the relevant Group Member or to the extent failure to pay,
discharge or satisfy such obligations could not reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect.

 

7.4.          Maintenance of Existence; Compliance.  (a)  (i)  Preserve, renew
and keep in full force and effect its organizational existence and (ii) take all
reasonable action to maintain all rights, privileges and franchises necessary or
desirable in the normal conduct of its business, except, in each case, as
otherwise permitted by Section 8.4 and except, in the case of clause (ii) above,
to the extent that failure to do so could not reasonably be expected to have a
Material Adverse Effect; and (b) comply with all Contractual Obligations and
Requirements of Law except to the extent that failure to comply therewith could
not, in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

7.5.          Maintenance of Property; Insurance.  (a)  Keep all property useful
and necessary in its business in good working order and condition, ordinary wear
and tear excepted and (b) maintain with financially sound and reputable
insurance companies insurance on all its property in at least such amounts and
against at least such risks (but including in any event public liability,
product liability and business interruption) as are usually insured against in
the same general area by companies engaged in the same or a similar business.

 

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7.6.          Inspection of Property; Books and Records; Discussions.  (a)  Keep
proper books of records and accounts in which full, true and correct entries in
conformity with GAAP and all Requirements of Law shall be made of all dealings
and transactions in relation to its business and activities and (b) permit
representatives of any Lender (coordinated through the Administrative Agent) to
visit and inspect any of its properties and examine and make abstracts from any
of its books and records at any reasonable time and as often as may reasonably
be desired and to discuss the business, operations, properties and financial and
other condition of the Group Members with officers and employees of the Group
Members and with their independent certified public accountants.

 

7.7.          Notices.  Promptly give notice to the Administrative Agent and
each Lender of:

 

(A) THE OCCURRENCE OF ANY DEFAULT OR EVENT OF DEFAULT;

 

(B) ANY (I) DEFAULT OR EVENT OF DEFAULT UNDER ANY CONTRACTUAL OBLIGATION OF ANY
GROUP MEMBER OR (II) LITIGATION, INVESTIGATION OR PROCEEDING THAT MAY EXIST AT
ANY TIME BETWEEN ANY GROUP MEMBER AND ANY GOVERNMENTAL AUTHORITY, THAT IN EITHER
CASE, HAS A REASONABLE LIKELIHOOD OF BEING ADVERSELY DETERMINED AND, IF NOT
CURED OR IF ADVERSELY DETERMINED, AS THE CASE MAY BE, COULD REASONABLY BE
EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT;

 

(C) ANY LITIGATION OR PROCEEDING AFFECTING ANY GROUP MEMBER (I) IN WHICH THE
AMOUNT INVOLVED IS $2,500,000 OR MORE AND NOT COVERED BY INSURANCE, (II) IN
WHICH INJUNCTIVE OR SIMILAR RELIEF IS SOUGHT THAT, IF ADVERSELY DETERMINED,
COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT OR (III) WHICH
RELATES TO ANY LOAN DOCUMENT;

 

(D) THE FOLLOWING EVENTS, AS SOON AS POSSIBLE AND IN ANY EVENT WITHIN 30 DAYS
AFTER THE BORROWER KNOWS OR HAS REASON TO KNOW THEREOF:  (I) THE OCCURRENCE OF
ANY REPORTABLE EVENT WITH RESPECT TO ANY PLAN, A FAILURE TO MAKE ANY REQUIRED
CONTRIBUTION TO A PLAN, THE CREATION OF ANY LIEN IN FAVOR OF THE PBGC OR A PLAN
OR ANY WITHDRAWAL FROM, OR THE TERMINATION, REORGANIZATION OR INSOLVENCY OF, ANY
MULTIEMPLOYER PLAN OR (II) THE INSTITUTION OF PROCEEDINGS OR THE TAKING OF ANY
OTHER ACTION BY THE PBGC OR THE BORROWER OR ANY COMMONLY CONTROLLED ENTITY OR
ANY MULTIEMPLOYER PLAN WITH RESPECT TO THE WITHDRAWAL FROM, OR THE TERMINATION,
REORGANIZATION OR INSOLVENCY OF, ANY PLAN; AND

 

(E) ANY DEVELOPMENT OR EVENT THAT HAS HAD OR COULD REASONABLY BE EXPECTED TO
HAVE A MATERIAL ADVERSE EFFECT.

 

Each notice pursuant to this Section 7.7 shall be accompanied by a statement of
a Responsible Officer setting forth details of the occurrence referred to
therein and stating what action the Borrower or the relevant Subsidiary proposes
to take with respect thereto.

 

7.8.          Environmental Laws.  (a)  Comply in all material respects with,
and take all commercially reasonable efforts to ensure compliance in all
material respects by all tenants and subtenants, if any, with, all applicable
Environmental Laws, and obtain and comply

 

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in all material respects with and maintain, and ensure that all tenants and
subtenants obtain and comply in all material respects with and maintain, any and
all licenses, approvals, notifications, registrations or permits required by
applicable Environmental Laws.

 

(b) Conduct and complete all investigations, studies, sampling and testing, and
all remedial, removal and other actions required under Environmental Laws and
promptly comply in all material respects with all lawful orders and directives
of all Governmental Authorities regarding Environmental Laws.

 

7.9.          Interest Rate Protection.  In the case of the Borrower, within
90 days after the Initial Borrowing Date, enter into, and thereafter maintain,
Hedge Agreements to the extent necessary to provide that at least 50% of the
aggregate principal amount of the Term Loans and the Subordinated Loans is
subject to either a fixed interest rate or interest rate protection for a period
of not less than two years, which Hedge Agreements shall have terms and
conditions reasonably satisfactory to the Administrative Agent.

 

7.10.        Additional Collateral, etc.    (a)  With respect to any property
acquired after the Initial Borrowing Date by any Group Member (other than
(x) any property described in paragraph (c) or (d) below and any interest in
real property, (y) any property subject to a Lien expressly permitted by
Section 8.3(g) and (z) property acquired by or the excess of 65% of stock in any
Foreign Subsidiary) as to which the Administrative Agent, for the benefit of the
Secured Parties, does not have a perfected Lien, promptly (i) execute and
deliver to the Administrative Agent such amendments to the Guarantee and
Collateral Agreement or such other documents as the Administrative Agent deems
necessary or advisable to grant to the Administrative Agent, for the benefit of
the Lenders, a first priority security interest (or, prior to the Discharge of
First Lien Obligations (as defined in the Intercreditor Agreement), second
priority) in such property (subject to Liens permitted by Section 8.3) and
(ii) take all actions necessary to grant to the Administrative Agent, for the
benefit of the Lenders, a perfected first priority security interest (or, prior
to the Discharge of First Lien Obligations (as defined in the Intercreditor
Agreement), second priority) in such property (subject to Liens permitted by
Section 8.3), including the filing of Uniform Commercial Code financing
statements in such jurisdictions as may be required by the Guarantee and
Collateral Agreement or by law or as may be requested by the Administrative
Agent.

 

(b) With respect to any fee interest in any real property having a value
(together with improvements thereof) of at least $500,000 acquired after the
Initial Borrowing Date by any Group Member (other than (x) any such real
property subject to a Lien expressly permitted by Section 8.3(h) and (y) real
property acquired by any Foreign Subsidiary), promptly (i) execute and deliver a
Mortgage, covering such real property, which shall grant to the Administrative
Agent for the benefit of the Secured Parties a first priority security interest
(or, prior to the Discharge of First Lien Obligations (as defined in the
Intercreditor Agreement), second priority) in such property (subject, in each
case, to Liens permitted by Section 8.3), (ii) if requested by the
Administrative Agent, provide the relevant Lenders with (x) title and extended
coverage insurance covering such real property in an amount at least equal to
the purchase price of such real property (or such other amount as shall be
reasonably specified by the Administrative Agent) as well as a current ALTA
survey thereof, together with a surveyor’s certificate and (y) any consents or
estoppels reasonably deemed necessary or advisable by the Administrative Agent
in connection with such Mortgage, each of the foregoing in form and substance

 

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reasonably satisfactory to the Administrative Agent and (iii) if requested by
the Administrative Agent, deliver to the Administrative Agent legal opinions
relating to the matters described above, which opinions shall be in form and
substance, and from counsel, reasonably satisfactory to the Administrative
Agent.

 

(c) With respect to any new Subsidiary (other than a Foreign Subsidiary) created
or acquired after the Initial Borrowing Date by any Group Member (which, for the
purposes of this paragraph (c), shall include any existing Subsidiary that
ceases to be a Foreign Subsidiary), promptly (i) execute and deliver to the
Administrative Agent such amendments to the Guarantee and Collateral Agreement
as the Administrative Agent deems necessary to grant to the Administrative
Agent, for the benefit of the Secured Parties, a perfected first priority
security interest (or prior to the Discharge of First Lien Obligations (as
defined in the Intercreditor Agreement), second priority) in the Capital Stock
of such new Subsidiary, (ii) deliver to the Administrative Agent (or, prior to
the discharge and satisfaction in full of the First Lien Obligations, the First
Lien Administrative Agent as bailee) the certificates representing such Capital
Stock, if any, together with undated stock powers, in blank, executed and
delivered by a duly authorized officer of the relevant Group Member, (iii) cause
such new Subsidiary (A) to become a party to the Guarantee and Collateral
Agreement, (B) to take such actions necessary to grant to the Administrative
Agent for the benefit of the Lenders a perfected first priority security
interest (or, prior to the Discharge of First Lien Obligations (as defined in
the Intercreditor Agreement), second priority) in the Collateral described in
the Guarantee and Collateral Agreement with respect to such new Subsidiary, in
the case of the Secured Parties, including the filing of Uniform Commercial Code
financing statements in such jurisdictions as may be required by the Guarantee
and Collateral Agreement or by law or as may be requested by the Administrative
Agent and (C) to deliver to the Administrative Agent a certificate of such
Subsidiary, substantially in the form of Exhibit H, with appropriate insertions
and attachments, and (iv) if requested by the Administrative Agent, deliver to
the Administrative Agent legal opinions relating to the matters described above,
which opinions shall be in form and substance, and from counsel, reasonably
satisfactory to the Administrative Agent.

 

(d) With respect to any new Foreign Subsidiary created or acquired after the
Initial Borrowing Date by any Group Member (other than by any Group Member that
is a Foreign Subsidiary), promptly (i) execute and deliver to the Administrative
Agent such amendments to the Guarantee and Collateral Agreement as the
Administrative Agent deems necessary or advisable to grant the Administrative
Agent, for the benefit of the Secured Parties, a perfected first priority
security interest (or, prior to the Discharge of First Lien Obligations (as
defined in the Intercreditor Agreement), second priority) in the Capital Stock
of such new Subsidiary (provided that in no event shall more than 65% of the
total voting power of the outstanding Capital Stock of any such new Subsidiary
be required to be so pledged), (ii) deliver to the Administrative Agent (or,
prior to the Discharge of First Lien Obligations (as defined in the
Intercreditor Agreement), the First Lien Administrative Agent as bailee) the
certificates representing such pledged Capital Stock, together with undated
stock powers, in blank, executed and delivered by a duly authorized officer of
the relevant Group Member and take such other action as may be necessary or, in
the opinion of the Administrative, desirable to perfect such Administrative
Agent security interest therein, and (iii) if requested by the Administrative,
deliver to the Administrative legal opinions relating to the matters described
above, which

 

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opinions shall be in form and substance, and from counsel, reasonably
satisfactory to the Administrative.

 

(e) Within 60 days following the Initial Borrowing Date, cause all cash and Cash
Equivalents of the Borrower and the Subsidiary Guarantors to be deposited or
maintained in accounts which are subject to Control Agreements (except for
accounts the aggregate amount of cash and Cash Equivalents in which do not
exceed $1,000,000 in the aggregate and cash and Cash Equivalents subject to
Liens permitted under Section 8.3 other than 8.2(b)).

 

7.11.        Further Assurances.  From time to time execute and deliver, or
cause to be executed and delivered, such additional instruments, certificates or
documents, and take all such actions, as the Administrative Agent may reasonably
request for the purposes of implementing or effectuating the provisions of this
Agreement relating to the Collateral, the Security Documents, or of more fully
perfecting or renewing the rights of the Administrative Agent and the Secured
Parties with respect to the Collateral (or with respect to any additions thereto
or replacements or proceeds thereof or with respect to any other property or
assets hereafter acquired by the borrower or any Subsidiary which may be deemed
to be part of the Collateral) pursuant hereto or thereto.  Upon the exercise by
the Administrative Agent or any Lender of any power, right, privilege or remedy
expressly provided pursuant to this Agreement or the other Loan Documents which
requires any consent, approval, recording qualification or authorization of any
Governmental Authority, the Borrower will execute and deliver, or will cause the
execution and delivery of, all applications, certifications, instruments and
other documents and papers that the Administrative Agent or such Secured Parties
may be required to obtain from the Borrower or any of its Subsidiaries for such
governmental consent, approval, recording, qualification or authorization.

 

SECTION 8.   NEGATIVE COVENANTS

 

The Borrower hereby agrees that, so long as the Term Loan Commitments remain in
effect or any Term Loan or other amount is owing to any Lender or Agent
hereunder, the Borrower shall not, and shall not permit any of its Subsidiaries
(or in the case of Section 8.17, Inactive Subsidiaries) to, directly or
indirectly:

 

8.1.          Financial Condition Covenants.  (a)  Consolidated Leverage Ratio. 
Permit the Consolidated Leverage Ratio as at the last day of any period of four
consecutive fiscal quarters of the Borrower ending with any fiscal quarter set
forth below to exceed the ratio set forth below opposite such fiscal quarter:

 

Fiscal Quarter

 

Consolidated
Leverage Ratio

 

March 31, 2006

 

5.50 to 1:00

 

June 30, 2006

 

5.50 to 1:00

 

September 30, 2006

 

5.50 to 1:00

 

December 31, 2006

 

5.25 to 1:00

 

 

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Fiscal Quarter

 

Consolidated
Leverage Ratio

 

March 31, 2007

 

5.00 to 1:00

 

June 30, 2007

 

5.00 to 1:00

 

September 30, 2007

 

4.75 to 1:00

 

December 31, 2007

 

4.50 to 1:00

 

March 31, 2008

 

4.25 to 1:00

 

June 30, 2008

 

4.25 to 1:00

 

September 30, 2008

 

4.00 to 1:00

 

December 31, 2008

 

4.00 to 1:00

 

March 31, 2009

 

3.75 to 1:00

 

June 30, 2009

 

3.75 to 1:00

 

September 30, 2009

 

3.50 to 1:00

 

December 31, 2009

 

3.50 to 1:00

 

March 31, 2010

 

3.50 to 1:00

 

June 30, 2010

 

3.25 to 1:00

 

September 30, 2010

 

3.25 to 1:00

 

December 31, 2010

 

3.25 to 1:00

 

March 30, 2011

 

3.25 to 1:00

 

 

(b) Consolidated First Lien Leverage Ratio.  Permit the Consolidated First Lien
Leverage Ratio as at the last day of any period of four consecutive fiscal
quarters of the Borrower ending with any fiscal quarter set forth below to
exceed the ratio set forth below opposite such fiscal quarter:

 

Fiscal Quarter

 

Consolidated First Lien
Leverage Ratio

 

March 31, 2006

 

2.75 to 1:00

 

June 30, 2006

 

2.75 to 1:00

 

September 30, 2006

 

2.75 to 1:00

 

December 31, 2006

 

2.50 to 1:00

 

March 31, 2007

 

2.50 to 1:00

 

June 30, 2007

 

2.50 to 1:00

 

September 30, 2007

 

2.25 to 1:00

 

December 31, 2007

 

2.25 to 1:00

 

March 31, 2008

 

2.25 to 1:00

 

June 30, 2008

 

2.25 to 1:00

 

September 30, 2008

 

2.25 to 1:00

 

December 31, 2008

 

2.25 to 1:00

 

March 31, 2009

 

2.25 to 1:00

 

June 30, 2009

 

2.25 to 1:00

 

September 30, 2009

 

2.25 to 1:00

 

December 31, 2009

 

2.25 to 1:00

 

March 31, 2010

 

2.25 to 1:00

 

June 30, 2010

 

2.25 to 1:00

 

September 30, 2010

 

2.25 to 1:00

 

December 31, 2010

 

2.25 to 1:00

 

March 30, 2011

 

2.25 to 1:00

 

 

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(c) Consolidated Fixed Charge Coverage Ratio.  Permit the Consolidated Fixed
Charge Coverage Ratio for any period of four consecutive fiscal quarters of the
Borrower ending with any fiscal quarter set forth below to be less than the
ratio set forth below opposite such fiscal quarter:

 

Fiscal Quarter

 

Consolidated Fixed Charge
Coverage Ratio

 

March 31, 2006

 

1.25 to 1:00

 

June 30, 2006

 

1.25 to 1:00

 

September 30, 2006

 

1.30 to 1:00

 

December 31, 2006

 

1.30 to 1:00

 

March 31, 2007

 

1.35 to 1:00

 

June 30, 2007

 

1.35 to 1:00

 

September 30, 2007

 

1.40 to 1:00

 

December 31, 2007

 

1.40 to 1:00

 

March 31, 2008

 

1.40 to 1:00

 

June 30, 2008

 

1.50 to 1:00

 

September 30, 2008

 

1.50 to 1:00

 

December 31, 2008

 

1.50 to 1:00

 

March 31, 2009

 

1.50 to 1:00

 

June 30, 2009

 

1.65 to 1:00

 

September 30, 2009

 

1.65 to 1:00

 

December 31, 2009

 

1.65 to 1:00

 

March 31, 2010

 

1.65 to 1:00

 

June 30, 2010

 

1.65 to 1:00

 

September 30, 2010

 

1.65 to 1:00

 

December 31, 2010

 

1.65 to 1:00

 

March 30, 2011

 

1.65 to 1:00

 

 

8.2.          Indebtedness.  Create, issue, incur, assume, become liable in
respect of or suffer to exist any Indebtedness, except:

 

(A) INDEBTEDNESS OF ANY LOAN PARTY PURSUANT TO ANY LOAN DOCUMENT;

 

(B) INDEBTEDNESS OF ANY LOAN PARTY UNDER THE FIRST LIEN CREDIT AGREEMENT OR ANY
PERMITTED REFINANCING INDEBTEDNESS, PROVIDED THAT THE AGGREGATE PRINCIPAL AMOUNT
OF SUCH INDEBTEDNESS MAY NOT EXCEED $100,000,000 AT ANY TIME OUTSTANDING OR
CAUSE THE CAP AMOUNT (AS DEFINED IN THE INTERCREDITOR AGREEMENT) TO BE EXCEEDED
AND MAY NOT BE REBORROWED AFTER REPAYMENT THEREOF (OTHER THAN PURSUANT TO
REVOLVING COMMITMENTS WHICH REMAIN IN EFFECT);

 

(C) INDEBTEDNESS OF THE BORROWER AND THE SUBSIDIARY GUARANTORS UNDER THE
SUBORDINATED LOAN AGREEMENT OR ANY PERMITTED REFINANCING INDEBTEDNESS; PROVIDED
THAT

 

52

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THE AGGREGATE PRINCIPAL AMOUNT OF SUCH INDEBTEDNESS MAY NOT EXCEED $25,000,000
(PLUS THE AMOUNT OF ANY ACCRUED OR CAPITALIZED PAYMENT IN KIND INTEREST) AT ANY
TIME OUTSTANDING AND MAY NOT BE REBORROWED AFTER REPAYMENT THEREOF;

 

(D) INDEBTEDNESS (I) OF THE BORROWER TO ANY SUBSIDIARY, (II) OF ANY SUBSIDIARY
GUARANTOR TO THE BORROWER OR ANY OTHER SUBSIDIARY, (III) OF ANY FOREIGN
SUBSIDIARY TO ANY OTHER FOREIGN SUBSIDIARY AND (IV) TO THE EXTENT PERMITTED BY
SECTION 8.8(K), OF ANY FOREIGN SUBSIDIARY TO THE BORROWER OR ANY SUBSIDIARY
GUARANTOR;

 

(E) GUARANTEE OBLIGATIONS INCURRED IN THE ORDINARY COURSE OF BUSINESS BY THE
BORROWER OR ANY OF ITS SUBSIDIARIES OF (I) OBLIGATIONS OF THE BORROWER, ANY
SUBSIDIARY GUARANTOR AND, TO THE EXTENT PERMITTED BY SECTION 8.8(K), OF ANY
FOREIGN SUBSIDIARY AND (II) OPERATING LEASE OBLIGATIONS OF THE BORROWER OR ANY
SUCH SUBSIDIARY ASSUMED BY A THIRD PARTY IN CONNECTION WITH A STORE CLOSURE OR
CONVERSION, IN EACH CASE CONSISTENT WITH PAST PRACTICE;

 

(F) INDEBTEDNESS AND GUARANTEE OBLIGATIONS OUTSTANDING ON THE DATE HEREOF AND
LISTED ON SCHEDULE 8.2(F) AND ANY REFINANCINGS, REFUNDINGS, RENEWALS OR
EXTENSIONS THEREOF (WITHOUT INCREASING, OR SHORTENING THE MATURITY OF, THE
PRINCIPAL AMOUNT THEREOF);

 

(G) INDEBTEDNESS (INCLUDING, WITHOUT LIMITATION, CAPITAL LEASE OBLIGATIONS)
SECURED BY LIENS PERMITTED BY SECTION 8.3(H) IN AN AGGREGATE PRINCIPAL AMOUNT
NOT TO EXCEED $3,300,000 AT ANY ONE TIME OUTSTANDING;

 

(H) INDEBTEDNESS OF THE BORROWER IN RESPECT OF THE SERIES Z PREFERRED AND ANY
REPLACEMENT EQUITY CONSISTING OF PREFERRED STOCK OF THE BORROWER;

 

(I) HEDGE AGREEMENTS PERMITTED UNDER SECTION 8.12;

 

(J) UNTIL THE INITIAL BORROWING DATE, (I) INDEBTEDNESS OF THE BORROWER IN
RESPECT OF THE EXISTING CREDIT FACILITY AND THE SENIOR NOTES AND (II) GUARANTEE
OBLIGATIONS OF ANY SUBSIDIARY IN RESPECT OF SUCH INDEBTEDNESS;

 

(K) INDEBTEDNESS RESULTING FROM (A) SURETY AND APPEAL BONDS INCURRED IN THE
ORDINARY COURSE OF BUSINESS AND (B) THE HONORING OF A CHECK, DRAFT OR SIMILAR
INSTRUMENT DRAWN AGAINST INSUFFICIENT FUNDS IN THE ORDINARY COURSE OF BUSINESS
SO LONG AS, IN THE CASE OF THIS CLAUSE (B), SUCH INDEBTEDNESS IS REPAID WITHIN
THREE BUSINESS DAYS;

 

(L) INDEBTEDNESS IN RESPECT OF THE “ADVANCE” OR SIMILAR ADVANCES (INCLUDING
ADVANCES MADE SUBSEQUENT TO THE CLOSING DATE) UNDER THE COKE BEVERAGE MARKETING
AGREEMENT (AS IN EFFECT ON THE DATE HEREOF) AND UP TO $1,100,000 IN ADDITIONAL
OUTSTANDING ADVANCES UNDER THE COKE BEVERAGE MARKETING AGREEMENT; AND

 

(M) ADDITIONAL INDEBTEDNESS OF THE BORROWER OR ANY OF ITS SUBSIDIARIES (NOT
OTHERWISE PERMITTED UNDER THIS SECTION 8.2) IN AN AGGREGATE PRINCIPAL AMOUNT
(FOR THE BORROWER AND ALL SUBSIDIARIES) NOT TO EXCEED $5,500,000 AT ANY ONE TIME
OUTSTANDING.

 

53

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8.3.          Liens.  Create, incur, assume or suffer to exist any Lien upon any
of its property, whether now owned or hereafter acquired, except for:

 

(A) LIENS FOR TAXES NOT YET DUE OR THAT ARE BEING CONTESTED OR DISPUTED IN GOOD
FAITH BY APPROPRIATE PROCEEDINGS, PROVIDED THAT ADEQUATE RESERVES WITH RESPECT
THERETO ARE MAINTAINED ON THE BOOKS OF THE BORROWER OR ITS SUBSIDIARIES, AS THE
CASE MAY BE, IN CONFORMITY WITH GAAP;

 

(B) LIENS ON THE COLLATERAL SECURING INDEBTEDNESS OF BORROWER AND ITS
SUBSIDIARIES PERMITTED BY SECTION 8.2(B);

 

(C) CARRIERS’, WAREHOUSEMEN’S, MECHANICS’, MATERIALMEN’S, REPAIRMEN’S,
LANDLORDS’ OR OTHER LIKE LIENS ARISING IN THE ORDINARY COURSE OF BUSINESS THAT
ARE NOT OVERDUE FOR A PERIOD OF MORE THAN 45 DAYS OR THAT ARE BEING CONTESTED IN
GOOD FAITH BY APPROPRIATE PROCEEDINGS;

 

(D) PLEDGES OR DEPOSITS IN CONNECTION WITH WORKERS’ COMPENSATION, UNEMPLOYMENT
INSURANCE AND OTHER SOCIAL SECURITY LEGISLATION;

 

(E) DEPOSITS TO SECURE THE PERFORMANCE OF BIDS, TRADE CONTRACTS (OTHER THAN FOR
BORROWED MONEY), OBLIGATIONS FOR UTILITIES, LEASES, STATUTORY OBLIGATIONS,
SURETY AND APPEAL BONDS, REPLEVIN BONDS, PERFORMANCE BONDS AND OTHER OBLIGATIONS
OF A LIKE NATURE INCURRED IN THE ORDINARY COURSE OF BUSINESS;

 

(F) ZONING RESTRICTIONS, EASEMENTS, RIGHTS-OF-WAY, RESTRICTIONS AND OTHER
SIMILAR ENCUMBRANCES INCURRED IN THE ORDINARY COURSE OF BUSINESS AND MINOR
IRREGULARITIES OF TITLE THAT, IN THE AGGREGATE, ARE NOT SUBSTANTIAL IN AMOUNT
AND THAT DO NOT IN ANY CASE MATERIALLY DETRACT FROM THE VALUE OF THE PROPERTY
SUBJECT THERETO OR MATERIALLY INTERFERE WITH THE ORDINARY CONDUCT OF THE
BUSINESS UTILIZING THE PROPERTY SUBJECT TO SUCH ENCUMBRANCES AND RESTRICTIONS;

 

(G) LIENS IN EXISTENCE ON THE DATE HEREOF LISTED ON SCHEDULE 8.3(G), SECURING
INDEBTEDNESS PERMITTED BY SECTION 8.2(F), PROVIDED THAT NO SUCH LIEN IS SPREAD
TO COVER ANY ADDITIONAL PROPERTY AFTER THE CLOSING DATE AND THAT THE AMOUNT OF
INDEBTEDNESS SECURED THEREBY IS NOT INCREASED (OTHER THAN ACCRUAL OF INTEREST,
FEES AND COSTS IN ACCORDANCE WITH THE TERMS THEREOF);

 

(H) LIENS SECURING INDEBTEDNESS OF THE BORROWER OR ANY OTHER SUBSIDIARY INCURRED
PURSUANT TO SECTION 8.2(G) TO FINANCE THE ACQUISITION OF FIXED OR CAPITAL
ASSETS, PROVIDED THAT (I) SUCH LIENS SHALL BE CREATED SUBSTANTIALLY
SIMULTANEOUSLY WITH THE ACQUISITION OF SUCH FIXED OR CAPITAL ASSETS, (II) SUCH
LIENS DO NOT AT ANY TIME ENCUMBER ANY PROPERTY OTHER THAN THE PROPERTY FINANCED
BY SUCH INDEBTEDNESS AND (III) THE AMOUNT OF INDEBTEDNESS SECURED THEREBY IS NOT
INCREASED (OTHER THAN ACCRUAL OF INTEREST, FEES AND COSTS IN ACCORDANCE WITH THE
TERMS THEREOF);

 

(I) JUDGMENT LIENS IN RESPECT OF JUDGMENTS NOT CONSTITUTING EVENTS OF DEFAULT
UNDER SECTION 9(H) SO LONG AS (A) SUCH JUDGMENT LIENS ARE RELEASED WITHIN 90
DAYS AFTER

 

54

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THE ENTRY THEREOF OR (B) THE AGGREGATE AMOUNT COVERED BY ALL SUCH JUDGMENT LIENS
DOES NOT EXCEED $2,750,000 AT ANY TIME;

 

(J) LIENS CREATED PURSUANT TO THE SECURITY DOCUMENTS;

 

(K) ANY INTEREST OR TITLE OF A LESSOR OR ANY LESSOR’S LENDER UNDER ANY LEASE
ENTERED INTO BY THE BORROWER OR ANY OTHER SUBSIDIARY IN THE ORDINARY COURSE OF
ITS BUSINESS AND COVERING ONLY THE ASSETS SO LEASED;

 

(L) LIENS NOT OTHERWISE PERMITTED BY THIS SECTION SO LONG AS (I) THE AGGREGATE
OUTSTANDING PRINCIPAL AMOUNT OF THE OBLIGATIONS SECURED THEREBY DOES NOT EXCEED
$1,100,000 AT ANY TIME AND (II) THE AGGREGATE FAIR MARKET VALUE (DETERMINED AS
OF THE DATE SUCH LIEN IS INCURRED) OF THE ASSETS ENCUMBERED THEREBY DOES NOT
EXCEED (AS TO THE BORROWER AND ALL SUBSIDIARIES) $1,650,000 AT ANY ONE TIME;

 

(M) LIENS EXISTING ON FIXED OR CAPITAL ASSETS AT THE TIME OF THE ACQUISITION
THEREOF BY THE BORROWER OR ANY SUBSIDIARY, PROVIDED, THAT (X) NEITHER (I) THE
AGGREGATE OUTSTANDING PRINCIPAL AMOUNT OF THE OBLIGATIONS SECURED THEREBY NOR
(II) THE AGGREGATE FAIR MARKET VALUE (DETERMINED AS OF THE DATE SUCH LIEN IS
INCURRED) OF THE ASSETS THERETO EXCEEDS (AS TO THE BORROWER AND ALL
SUBSIDIARIES) $1,100,000 AT ANY ONE TIME, (Y) SUCH LIENS WERE NOT CREATED IN
CONNECTION WITH OR IN CONTEMPLATION OF SUCH ACQUISITION AND (Z) SUCH LIENS DO
NOT COVER ANY ADDITIONAL PROPERTY AND THE OBLIGATIONS SECURED THEREBY ARE NOT
INCREASED;

 

(N) LIENS RESULTING FROM THE GRANTING OF LICENSES IN THE ORDINARY COURSE OF
BUSINESS TO ANY PERSON TO USE ANY INTELLECTUAL PROPERTY; AND

 

(O) UNTIL THE INITIAL BORROWING DATE, LIENS SECURING INDEBTEDNESS OF THE
BORROWER OR ANY OF THE SUBSIDIARY GUARANTORS IN RESPECT OF THE EXISTING CREDIT
FACILITY, THE SENIOR NOTES AND ANY GUARANTEE OBLIGATIONS OF ANY SUBSIDIARY IN
RESPECT OF SUCH INDEBTEDNESS.

 

8.4.          Fundamental Changes.  Enter into any merger, consolidation or
amalgamation, or liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution), or Dispose of, all or substantially all of its
property or business, except that:

 

(A) ANY SUBSIDIARY OF THE BORROWER MAY BE MERGED OR CONSOLIDATED WITH OR INTO
THE BORROWER (PROVIDED THAT THE BORROWER SHALL BE THE CONTINUING OR SURVIVING
CORPORATION) OR WITH OR INTO ANY SUBSIDIARY GUARANTOR (PROVIDED THAT THE
SUBSIDIARY GUARANTOR SHALL BE THE CONTINUING OR SURVIVING CORPORATION) OR,
SUBJECT TO SECTION 8.8(K), WITH OR INTO ANY FOREIGN SUBSIDIARY;

 

(B) (I) ANY SUBSIDIARY OF THE BORROWER MAY DISPOSE OF ANY OR ALL OF ITS ASSETS
(UPON VOLUNTARY LIQUIDATION OR OTHERWISE) TO THE BORROWER OR ANY SUBSIDIARY
GUARANTOR OR, TO THE EXTENT PERMITTED BY SECTION 8.8(K), ANY FOREIGN SUBSIDIARY
AND (II) FOLLOWING THE DISPOSITION OF ALL OF ITS ASSETS IN ACCORDANCE WITH
CLAUSE (I) ABOVE, SUCH SUBSIDIARY MAY LIQUIDATE, WIND UP OR DISSOLVE;

 

55

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(C) ANY SUBSIDIARY MAY MERGE WITH ANOTHER PERSON TO EFFECT A TRANSACTION
PERMITTED UNDER SECTIONS 8.8(K) AND (L); AND

 

(D) TRANSACTIONS PERMITTED UNDER SECTION 8.5 SHALL BE PERMITTED.

 

8.5.          Disposition of Property.  Dispose of any of its property, whether
now owned or hereafter acquired, or, in the case of any Subsidiary, issue or
sell any shares of such Subsidiary’s Capital Stock to any Person, except:

 

(A) THE DISPOSITION (INCLUDING ABANDONMENT OF INTELLECTUAL PROPERTY) OF OBSOLETE
OR WORN OUT PROPERTY OR OF PROPERTY NO LONGER USEFUL OR USED IN THE BORROWER’S
OR ANY OF THE SUBSIDIARIES’ BUSINESS, IN EACH CASE, IN THE ORDINARY COURSE OF
BUSINESS, WHETHER NOW OWNED OR HEREAFTER ACQUIRED;

 

(B) THE SALE OF INVENTORY IN THE ORDINARY COURSE OF BUSINESS;

 

(C) DISPOSITIONS PERMITTED BY SECTION 8.4(B);

 

(D) THE SALE OR ISSUANCE OF ANY SUBSIDIARY’S CAPITAL STOCK TO THE BORROWER OR
ANY WHOLLY OWNED SUBSIDIARY GUARANTOR;

 

(E) THE SALE OR DISCOUNT WITHOUT RECOURSE OF ACCOUNTS RECEIVABLE OR NOTES
RECEIVABLE ARISING IN THE ORDINARY COURSE OF BUSINESS, OR THE CONVERSION OR
EXCHANGE OF ACCOUNTS RECEIVABLE INTO OR FOR NOTES RECEIVABLE, IN CONNECTION WITH
THE COMPROMISE OR COLLECTION THEREOF;

 

(F) THE DISPOSITION OF THE CAPITAL STOCK OR THE ASSETS OF MANHATTAN BAGELS
COMPANY, INC., PROVIDED THAT, (I) THE CONSIDERATION RECEIVED IN ANY SUCH
DISPOSITION SHALL BE IN AN AMOUNT AT LEAST EQUAL TO THE FAIR MARKET VALUE OF
SUCH PROPERTY AND (II) AT LEAST 50% OF THE CONSIDERATION RECEIVED IN ANY SUCH
DISPOSITION SHALL BE IN CASH;

 

(G) THE DISPOSITION OF ASSETS OF THE NEW WORLD COFFEE BUSINESS AND THE CAPITAL
STOCK OR ASSETS OF CHESAPEAKE BAGEL FRANCHISE CORP.;

 

(H) SUBLEASES, LICENSES, FRANCHISES AND DISPOSITIONS OR CANCELLATIONS OF LEASES,
LICENSES OR FRANCHISE AGREEMENTS IN THE ORDINARY COURSE OF BUSINESS; AND

 

(I) THE DISPOSITION OF OTHER PROPERTY FOR CONSIDERATION NOT TO EXCEED $5,500,000
IN THE AGGREGATE FOR ANY CALENDAR YEAR OF THE BORROWER.

 

8.6.          Restricted Payments.  Declare or pay any dividend (other than
dividends payable solely in common stock, or options, warrants or other rights
to purchase common stock, of the Person making such dividend) on, or make any
payment on account of, or set apart assets for a sinking or other analogous fund
for, the purchase, redemption, defeasance, retirement or other acquisition of,
any Capital Stock of any Group Member, whether now or hereafter outstanding, or
make any other distribution in respect thereof, either directly or indirectly,
whether in cash or property or in obligations of the Borrower or any Subsidiary
(collectively, “Restricted Payments”), except that:

 

56

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(A) ANY SUBSIDIARY MAY MAKE RESTRICTED PAYMENTS TO THE BORROWER OR ANY WHOLLY
OWNED SUBSIDIARY GUARANTOR; AND

 

(B) SO LONG AS NO DEFAULT OR EVENT OF DEFAULT SHALL HAVE OCCURRED AND BE
CONTINUING OR WOULD RESULT THEREFROM, THE BORROWER MAY PURCHASE THE BORROWER’S
COMMON STOCK OR COMMON STOCK OPTIONS FROM PRESENT OR FORMER OFFICERS,
CONSULTANTS OR EMPLOYEES OF ANY GROUP MEMBER UPON THE DEATH, DISABILITY OR
TERMINATION OF EMPLOYMENT OF SUCH OFFICER, CONSULTANT OR EMPLOYEE, PROVIDED,
THAT THE AGGREGATE AMOUNT OF PAYMENTS HEREUNDER AFTER THE DATE HEREOF (NET OF
ANY PROCEEDS RECEIVED BY THE BORROWER AFTER THE DATE HEREOF IN CONNECTION WITH
RESALES OF ANY COMMON STOCK OR COMMON STOCK OPTIONS SO PURCHASED) SHALL NOT
EXCEED $1,100,000.

 

8.7.          Capital Expenditures.  Make or commit to make any Capital
Expenditures, other than Capital Expenditures indicated in any fiscal year
below, in an aggregate amount not to exceed the corresponding amount indicated
below:

 

Fiscal Year

 

Capital Expenditures

 

2006

 

$

22,000,000

 

2007

 

$

22,000,000

 

2008

 

$

27,500,000

 

2009

 

$

22,000,000

 

2010

 

$

22,000,000

 

2011

 

$

22,000,000

 

 

8.8.          Investments.  Make any advance, loan, extension of credit (by way
of guaranty or otherwise) or capital contribution to, or purchase any Capital
Stock, bonds, notes, debentures or other debt securities of, or any assets
constituting a business unit of, or make any other investment in, any other
Person (all of the foregoing, “Investments”), except:

 

(A) EXTENSIONS OF TRADE CREDIT IN THE ORDINARY COURSE OF BUSINESS;

 

(B) INVESTMENTS IN CASH AND CASH EQUIVALENTS;

 

(C) GUARANTEE OBLIGATIONS PERMITTED BY SECTION 8.2;

 

(D) LOANS AND ADVANCES TO OFFICERS, DIRECTORS, CONSULTANTS, EMPLOYEES OF ANY
GROUP MEMBER OF THE BORROWER IN THE ORDINARY COURSE OF BUSINESS (INCLUDING FOR
INDEMNIFICATION, TRAVEL, ENTERTAINMENT AND RELOCATION EXPENSES) IN AN AGGREGATE
AMOUNT FOR ALL GROUP MEMBERS NOT TO EXCEED $550,000 AT ANY ONE TIME OUTSTANDING;

 

(E) INVESTMENTS IN NOTES RECEIVABLE AND OTHER INSTRUMENTS AND SECURITIES
OBTAINED IN CONNECTION WITH TRANSACTIONS PERMITTED BY SECTION 8.5(E);

 

(F) INTERCOMPANY INVESTMENTS BY (I) ANY GROUP MEMBER IN THE BORROWER OR ANY
PERSON THAT, PRIOR TO SUCH INVESTMENT, IS A SUBSIDIARY GUARANTOR OR (II) ANY
FOREIGN SUBSIDIARY IN ANY FOREIGN SUBSIDIARY;

 

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(G) INVESTMENTS RESULTING FROM PAYMENTS REQUIRED UNDER HEDGE AGREEMENTS
PERMITTED UNDER SECTION 8.12;

 

(H) INVESTMENTS RESULTING FROM NON-CASH CONSIDERATION RECEIVED IN CONNECTION
WITH ASSET SALES SO LONG AS THE AGGREGATE OUTSTANDING AMOUNT OF SUCH INVESTMENTS
DOES NOT EXCEED $8,250,000 AT ANY TIME;

 

(I) CAPITAL EXPENDITURES PERMITTED UNDER SECTION 8.7;

 

(J) (I) LOANS TO FRANCHISEES AND AREA DEVELOPERS IN AN AMOUNT NOT TO EXCEED
$275,000 IN ANY FISCAL YEAR AND (II) EXISTING LOANS TO FRANCHISEES NOT TO EXCEED
$275,000 IN THE AGGREGATE;

 

(K) IN ADDITION TO INVESTMENTS OTHERWISE EXPRESSLY PERMITTED BY THIS SECTION,
INVESTMENTS (INCLUDING ACQUISITIONS) BY THE BORROWER OR ANY OF ITS SUBSIDIARIES
IN AN AGGREGATE AMOUNT OUTSTANDING (VALUED AT COST) NOT TO EXCEED AT ANY ONE
TIME THE SUM OF (I) $1,100,000 PLUS (II) THE PRODUCT OF (X) $1,100,000 AND (Y)
THE NUMBER OF CALENDAR YEARS ENDED AFTER THE CLOSING DATE MINUS (III) THE
OUTSTANDING AMOUNT OF ANY INVESTMENTS MADE IN RELIANCE ON SECTION 8.8(L)(IV)(Y);

 

(L) ACQUISITIONS, PROVIDED THAT (I) NO DEFAULT OR EVENT OF DEFAULT SHALL HAVE
THEN OCCURRED AND BE CONTINUING OR WOULD RESULT THEREFROM, (II) SUCH ACQUISITION
IS INITIATED AND COMPLETED ON A “FRIENDLY” BASIS, (III) IF SUCH ACQUISITION IS A
MATERIAL ACQUISITION, AFTER GIVING EFFECT THERETO ON A PRO FORMA BASIS AS IF
SUCH ACQUISITION WERE COMPLETED ON THE FIRST DAY OF THE MOST RECENT PERIOD OF
FOUR CONSECUTIVE FISCAL QUARTERS FOR WHICH FINANCIAL STATEMENTS HAVE BEEN
DELIVERED, THE BORROWER WOULD HAVE BEEN IN COMPLIANCE WITH SECTIONS 8.1(A) AND
8.1(B) (ASSUMING THE REQUIRED RATIO WAS 0.25 TO 1.00 LOWER THAN THE THEN
APPLICABLE RATIO), (IV) THE CONSIDERATION FOR ANY SUCH ACQUISITION SHALL CONSIST
EXCLUSIVELY OF A COMBINATION OF (X) COMMON STOCK OF THE BORROWER AND (Y) OTHER
CONSIDERATION IN CONNECTION WITH SUCH ACQUISITION IN AN AGGREGATE AMOUNT
OUTSTANDING (VALUED AT COST) NOT TO EXCEED AT ANY ONE TIME THE SUM OF (I)
$1,100,000 PLUS (II) THE PRODUCT OF (A) $1,100,000 AND (B) THE NUMBER OF
CALENDAR YEARS ENDED AFTER THE CLOSING DATE MINUS (III) THE OUTSTANDING AMOUNT
OF ANY INVESTMENTS MADE IN RELIANCE ON SECTION 8.8(K) AND (V) THE BORROWER SHALL
HAVE DELIVERED A CERTIFICATE OF A RESPONSIBLE OFFICER CERTIFYING COMPLIANCE WITH
THE FOREGOING CONDITIONS (AND ATTACHING REASONABLY DETAILED CALCULATIONS) AT
LEAST FIVE BUSINESS DAYS PRIOR TO THE CONSUMMATION THEREOF; AND

 

(M) DEPOSITS PERMITTED BY SECTION 8.3(E).

 

8.9.          Certain Payments and Modifications of Certain Debt Instruments. 
(a)  Make or offer to make any optional or voluntary payment, optional or
voluntary prepayment, optional or voluntary repurchase or optional or voluntary
redemption of or otherwise optionally or voluntarily defease or segregate funds
with respect to (i) the Series Z Preferred or any Replacement Equity (other than
with the Net Cash Proceeds of any Replacement Equity), (ii) the Subordinated
Loans or any Permitted Refinancing Indebtedness incurred pursuant to
Section 8.2(c) (in each case, other than with the Net Cash Proceeds of (x) any
Capital Stock issued to any Group Member or the Permitted Investors, (y) so long
as (A) the Consolidated Leverage Ratio at

 

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such time and after giving effect thereto is equal to or less than 3.25 to 1.00
and (B) no Default or Event of Default shall have occurred and be continuing or
would result therefrom, any issuance of common stock of the Borrower, or (z) so
long as no Default or Event of Default shall have occurred and be continuing or
would result therefrom, Permitted Refinancing Indebtedness), (b) amend, modify,
waive or otherwise change, or consent or agree to any amendment, modification,
waiver or other change to, any of the terms of (i) the Series Z Preferred or any
Replacement Equity consisting of preferred stock (other than any such amendment,
modification, waiver or other change that (A) would extend or eliminate the
scheduled redemption date or reduce the amount of any scheduled redemption
payment or reduce the rate or extend any date for payment of dividends thereon
and (B) does not involve the payment of a consent fee other than any consent
fees paid in connection with the extension of the scheduled redemption date in
an aggregate amount not exceeding $250,000) or (ii) the Subordinated Loan
Agreement (other than any such amendment, modification, waiver or other change
that (A) would extend or eliminate the maturity or reduce the amount of any
payment of principal thereof or reduce the rate or extend any date for payment
of interest thereon and (B) does not involve the payment of a consent fee),
(c) designate any Indebtedness (other than obligations of the Loan Parties
pursuant to the Loan Documents or the First Lien Loan Documents (as defined in
the Intercreditor Agreement) or any Permitted Refinancing Indebtedness in
respect thereof) as “Designated Senior Indebtedness” (or any other defined term
having a similar purpose) for the purposes of the Subordination Agreement or
(d) make any payment in respect of any Indebtedness under the Coke Beverage
Marketing Agreement or any other Indebtedness of the type described in clause
(k) of the definition thereof, to the extent that, after giving effect thereto,
the Available Revolving Commitment (as defined in the First Lien Credit
Agreement) would be less than $2,200,000.

 

8.10.        Transactions with Affiliates.  Enter into any transaction,
including any purchase, sale, lease or exchange of property, the rendering of
any service or the payment of any management, advisory or similar fees, with any
Affiliate (other than the Borrower or any Wholly Owned Subsidiary Guarantor)
unless such transaction is (a) otherwise not prohibited under this Agreement and
(b)  upon fair and reasonable terms no less favorable to the relevant Group
Member, than it would obtain in a comparable arm’s length transaction with a
Person that is not an Affiliate; it being understood that the Subordinated Loan
Agreement and the Subordination Agreement shall be permitted and the
Subordinated Loans may be repaid in accordance with the terms thereof to the
extent permitted hereunder.

 

8.11.        Sales and Leasebacks.  Enter into any arrangement with any Person
providing for the leasing by any Group Member of real or personal property that
has been or is to be sold or transferred by such Group Member to such Person or
to any other Person to whom funds have been or are to be advanced by such Person
on the security of such property or rental obligations of such Group Member.

 

8.12.        Hedge Agreements.  Enter into any Hedge Agreement, except Hedge
Agreements entered into in order to effectively cap, collar or exchange interest
rates from floating to fixed rates with respect to any interest-bearing
liability or investment of the Borrower or any Subsidiary.

 

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8.13.        Changes in Fiscal Periods.  Permit the fiscal year of the Borrower
to end on a day other than December 31 (subject to Section 1.2(f)) or change the
Borrower’s method of determining fiscal quarters; provided, that, with the prior
written consent of the Administrative Agent and the Lead Arranger (such consent
not to be unreasonably withheld), the Borrower may change its fiscal year,
provided, that, in connection with such change, no fiscal year may include more
than five fiscal quarters without the prior written consent of the
Administrative Agent and the Lead Arranger and the amounts permitted under
Section 8.7 shall be pro rata with respect to any fiscal year which does not
consist of four fiscal quarters.

 

8.14.        Negative Pledge Clauses.  Enter into or suffer to exist or become
effective any agreement that prohibits, limits or imposes any condition upon the
ability of any Group Member to create, incur, assume or suffer to exist any Lien
upon any of its property or revenues, whether now owned or hereafter acquired,
to secure its obligations under the Loan Documents or any refinancing thereof
other than (a) this Agreement and the other Loan Documents, (b) the First Lien
Credit Agreement and the Subordinated Loan Agreement and any provisions in any
Permitted Refinancing Indebtedness so long as such provisions are no more
restrictive than the provisions in the First Lien Credit Agreement or the
Subordinated Loan Agreement, as applicable, (c) any agreements governing any
utility bonds, industrial revenue or development bonds, purchase money Liens or
Capital Lease Obligations otherwise permitted hereby (in which case, any
prohibition or limitation shall only be effective against the assets financed
thereby), (d) until the Initial Borrowing Date, the Existing Credit Facility and
the Senior Notes, (e) restrictions on assets subject to agreements for permitted
Dispositions under Section 8.5 (such restrictions to be limited to the assets
subject to such Dispositions) and (f) restrictions in lease agreements
restricting the Group Members from assigning or pledging their rights under such
lease agreements.

 

8.15.        Clauses Restricting Subsidiary Distributions.  Enter into or suffer
to exist or become effective any consensual encumbrance or restriction on the
ability of any Subsidiary of the Borrower to (a) make Restricted Payments in
respect of any Capital Stock of such Subsidiary held by, or pay any Indebtedness
owed to, the Borrower or any other Subsidiary of the Borrower, (b) make loans or
advances to, or other Investments in, the Borrower or any other Subsidiary of
the Borrower or (c) transfer any of its assets to the Borrower or any other
Subsidiary of the Borrower, except for such encumbrances or restrictions
existing under or by reason of (i) any restrictions existing under the Loan
Documents, (ii) the First Lien Credit Agreement and the Subordinated Loan
Agreement and any provisions in any Permitted Refinancing Indebtedness so long
as such provisions are no more restrictive than the provisions in the First Lien
Credit Agreement or the Subordinated Loan Agreement, as applicable, (iii) any
restrictions with respect to a Subsidiary imposed pursuant to an agreement that
has been entered into in connection with the Disposition of all or substantially
all of the Capital Stock or assets of such Subsidiary and (iv) until the Initial
Borrowing Date, the Existing Credit Facility and the Senior Notes.

 

8.16.        Lines of Business.  Enter into any business, either directly or
through any Subsidiary, except for those businesses in which the Borrower and
its Subsidiaries are engaged on the date of this Agreement or that are
reasonably related thereto.

 

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8.17.        Inactive Subsidiaries.  With respect to Inactive Subsidiaries,
(a) engage in an active business or (b) except as disclosed on Part B of
Schedule 5.22, own any property or assets or incur, directly or indirectly,
liabilities or obligations in excess of $100,000 in the aggregate.

 

SECTION 9.   EVENTS OF DEFAULT

 

If any of the following events shall occur and be continuing:

 

(A) THE BORROWER SHALL FAIL TO PAY ANY PRINCIPAL OF ANY TERM LOAN WHEN DUE IN
ACCORDANCE WITH THE TERMS HEREOF; OR THE BORROWER SHALL FAIL TO PAY ANY INTEREST
ON ANY TERM LOAN, OR ANY OTHER AMOUNT PAYABLE HEREUNDER OR UNDER ANY OTHER LOAN
DOCUMENT, WITHIN FIVE DAYS AFTER ANY SUCH INTEREST OR OTHER AMOUNT BECOMES DUE
IN ACCORDANCE WITH THE TERMS HEREOF; OR

 

(B) ANY REPRESENTATION OR WARRANTY MADE OR DEEMED MADE BY ANY LOAN PARTY HEREIN
OR IN ANY OTHER LOAN DOCUMENT OR THAT IS CONTAINED IN ANY CERTIFICATE, DOCUMENT
OR FINANCIAL OR OTHER STATEMENT FURNISHED BY IT AT ANY TIME UNDER OR IN
CONNECTION WITH THIS AGREEMENT OR ANY SUCH OTHER LOAN DOCUMENT SHALL PROVE TO
HAVE BEEN INACCURATE IN ANY MATERIAL RESPECT (EXCEPT THAT SUCH MATERIALITY
QUALIFIER SHALL NOT BE APPLICABLE TO ANY REPRESENTATIONS AND WARRANTIES THAT ARE
ALREADY QUALIFIED OR MODIFIED BY MATERIALITY IN THE TEXT THEREOF) ON OR AS OF
THE DATE MADE OR DEEMED MADE; OR

 

(C) (I)  ANY LOAN PARTY SHALL DEFAULT IN THE OBSERVANCE OR PERFORMANCE OF ANY
AGREEMENT CONTAINED IN CLAUSE (I) OR (II) OF SECTION 7.4(A) (WITH RESPECT TO THE
BORROWER ONLY), SECTION 7.5(B), SECTION 7.7(A) OR SECTION 8 OF THIS AGREEMENT OR
SECTIONS 5.5(A) AND 5.7(B) OF EITHER GUARANTEE AND COLLATERAL AGREEMENT OR
(II) AN “EVENT OF DEFAULT” UNDER AND AS DEFINED IN ANY MORTGAGE SHALL HAVE
OCCURRED AND BE CONTINUING; OR

 

(D) ANY LOAN PARTY SHALL DEFAULT IN THE OBSERVANCE OR PERFORMANCE OF ANY OTHER
AGREEMENT CONTAINED IN THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT (OTHER THAN AS
PROVIDED IN PARAGRAPHS (A) THROUGH (C) OF THIS SECTION), AND SUCH DEFAULT SHALL
CONTINUE UNREMEDIED FOR A PERIOD OF 30 DAYS AFTER NOTICE TO THE BORROWER FROM
THE ADMINISTRATIVE AGENT OR THE REQUIRED LENDERS; OR

 

(E) ANY GROUP MEMBER (OTHER THAN AN INACTIVE SUBSIDIARY) (I) DEFAULTS IN MAKING
ANY PAYMENT OF ANY PRINCIPAL OF ANY INDEBTEDNESS (INCLUDING THE FIRST LIEN
LOANS, THE SUBORDINATED LOANS AND ANY GUARANTEE OBLIGATION, BUT EXCLUDING THE
TERM LOANS) ON THE SCHEDULED OR ORIGINAL DUE DATE WITH RESPECT THERETO; OR
(II) DEFAULTS IN MAKING ANY PAYMENT OF ANY INTEREST ON ANY SUCH INDEBTEDNESS
BEYOND THE PERIOD OF GRACE, IF ANY, PROVIDED IN THE INSTRUMENT OR AGREEMENT
UNDER WHICH SUCH INDEBTEDNESS WAS CREATED; OR (III) DEFAULTS IN THE OBSERVANCE
OR PERFORMANCE OF ANY OTHER AGREEMENT OR CONDITION RELATING TO ANY SUCH
INDEBTEDNESS OR CONTAINED IN ANY INSTRUMENT OR AGREEMENT (INCLUDING THE FIRST
LIEN CREDIT AGREEMENT AND THE SUBORDINATED LOAN AGREEMENT) EVIDENCING, SECURING
OR RELATING THERETO, OR ANY OTHER EVENT SHALL OCCUR OR CONDITION EXIST, THE
EFFECT OF WHICH DEFAULT OR OTHER EVENT OR CONDITION IS TO CAUSE, OR TO PERMIT
THE HOLDER OR BENEFICIARY OF SUCH INDEBTEDNESS (OR A TRUSTEE OR AGENT ON BEHALF
OF SUCH HOLDER OR

 

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BENEFICIARY) TO CAUSE, WITH THE GIVING OF NOTICE IF REQUIRED, SUCH INDEBTEDNESS
TO BECOME DUE PRIOR TO ITS STATED MATURITY OR TO BECOME SUBJECT TO A MANDATORY
OFFER TO PURCHASE BY THE OBLIGOR THEREUNDER OR (IN THE CASE OF ANY SUCH
INDEBTEDNESS CONSTITUTING A GUARANTEE OBLIGATION) TO BECOME PAYABLE; PROVIDED,
THAT A DEFAULT, EVENT OR CONDITION DESCRIBED IN CLAUSE (I), (II) OR (III) OF
THIS PARAGRAPH (E) SHALL NOT AT ANY TIME CONSTITUTE AN EVENT OF DEFAULT UNLESS,
AT SUCH TIME, ONE OR MORE DEFAULTS, EVENTS OR CONDITIONS OF THE TYPE DESCRIBED
IN CLAUSES (I), (II) AND (III) OF THIS PARAGRAPH (E) SHALL HAVE OCCURRED AND BE
CONTINUING WITH RESPECT TO INDEBTEDNESS THE OUTSTANDING PRINCIPAL AMOUNT OF
WHICH EXCEEDS IN THE AGGREGATE $2,750,000; OR

 

(F) (I) ANY GROUP MEMBER (OTHER THAN AN INACTIVE SUBSIDIARY) SHALL COMMENCE ANY
CASE, PROCEEDING OR OTHER ACTION (A) UNDER ANY EXISTING OR FUTURE LAW OF ANY
JURISDICTION, DOMESTIC OR FOREIGN, RELATING TO BANKRUPTCY, INSOLVENCY,
REORGANIZATION OR RELIEF OF DEBTORS, SEEKING TO HAVE AN ORDER FOR RELIEF ENTERED
WITH RESPECT TO IT, OR SEEKING TO ADJUDICATE IT A BANKRUPT OR INSOLVENT, OR
SEEKING REORGANIZATION, ARRANGEMENT, ADJUSTMENT, WINDING-UP, LIQUIDATION,
DISSOLUTION, COMPOSITION OR OTHER RELIEF WITH RESPECT TO IT OR ITS DEBTS, OR
(B) SEEKING APPOINTMENT OF A RECEIVER, TRUSTEE, CUSTODIAN, CONSERVATOR OR OTHER
SIMILAR OFFICIAL FOR IT OR FOR ALL OR ANY SUBSTANTIAL PART OF ITS ASSETS, OR ANY
GROUP MEMBER SHALL MAKE A GENERAL ASSIGNMENT FOR THE BENEFIT OF ITS CREDITORS;
OR (II) THERE SHALL BE COMMENCED AGAINST ANY GROUP MEMBER (OTHER THAN AN
INACTIVE SUBSIDIARY) ANY CASE, PROCEEDING OR OTHER ACTION OF A NATURE REFERRED
TO IN CLAUSE (I) ABOVE THAT (A) RESULTS IN THE ENTRY OF AN ORDER FOR RELIEF OR
ANY SUCH ADJUDICATION OR APPOINTMENT OR (B) REMAINS UNDISMISSED, UNDISCHARGED OR
UNBONDED FOR A PERIOD OF 60 DAYS; OR (III) THERE SHALL BE COMMENCED AGAINST ANY
GROUP MEMBER (OTHER THAN AN INACTIVE SUBSIDIARY) ANY CASE, PROCEEDING OR OTHER
ACTION SEEKING ISSUANCE OF A WARRANT OF ATTACHMENT, EXECUTION, DISTRAINT OR
SIMILAR PROCESS AGAINST ALL OR ANY SUBSTANTIAL PART OF ITS ASSETS THAT RESULTS
IN THE ENTRY OF AN ORDER FOR ANY SUCH RELIEF THAT SHALL NOT HAVE BEEN VACATED,
DISCHARGED, OR STAYED OR BONDED PENDING APPEAL WITHIN 60 DAYS FROM THE ENTRY
THEREOF; OR (IV) ANY GROUP MEMBER (OTHER THAN AN INACTIVE SUBSIDIARY) SHALL TAKE
ANY ACTION IN FURTHERANCE OF, OR INDICATING ITS CONSENT TO, APPROVAL OF, OR
ACQUIESCENCE IN, ANY OF THE ACTS SET FORTH IN CLAUSE (I), (II), OR (III) ABOVE;
OR (V) ANY GROUP MEMBER (OTHER THAN AN INACTIVE SUBSIDIARY) SHALL GENERALLY NOT,
OR SHALL BE UNABLE TO, OR SHALL ADMIT IN WRITING ITS INABILITY TO, PAY ITS DEBTS
AS THEY BECOME DUE; OR

 

(G) (I)  ANY PERSON SHALL ENGAGE IN ANY “PROHIBITED TRANSACTION” (AS DEFINED IN
SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE) INVOLVING ANY PLAN, (II) ANY
“ACCUMULATED FUNDING DEFICIENCY” (AS DEFINED IN SECTION 302 OF ERISA), WHETHER
OR NOT WAIVED, SHALL EXIST WITH RESPECT TO ANY PLAN OR ANY LIEN IN FAVOR OF THE
PBGC OR A PLAN SHALL ARISE ON THE ASSETS OF ANY GROUP MEMBER OR ANY COMMONLY
CONTROLLED ENTITY, (III) A REPORTABLE EVENT SHALL OCCUR WITH RESPECT TO, OR
PROCEEDINGS SHALL COMMENCE TO HAVE A TRUSTEE APPOINTED, OR A TRUSTEE SHALL BE
APPOINTED, TO ADMINISTER OR TO TERMINATE, ANY SINGLE EMPLOYER PLAN, WHICH
REPORTABLE EVENT OR COMMENCEMENT OF PROCEEDINGS OR APPOINTMENT OF A TRUSTEE IS,
IN THE REASONABLE OPINION OF THE REQUIRED LENDERS, LIKELY TO RESULT IN THE
TERMINATION OF SUCH PLAN FOR PURPOSES OF TITLE IV OF ERISA, (IV) ANY SINGLE
EMPLOYER PLAN SHALL TERMINATE FOR PURPOSES OF TITLE IV OF ERISA, (V) ANY GROUP
MEMBER OR ANY COMMONLY CONTROLLED ENTITY SHALL, OR IN THE REASONABLE OPINION OF
THE REQUIRED LENDERS IS LIKELY TO, INCUR ANY LIABILITY IN CONNECTION WITH A
WITHDRAWAL FROM, OR THE

 

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INSOLVENCY OR REORGANIZATION OF, A MULTIEMPLOYER PLAN OR (VI) ANY OTHER EVENT OR
CONDITION SHALL OCCUR OR EXIST WITH RESPECT TO A PLAN; AND IN EACH CASE IN
CLAUSES (I) THROUGH (VI) ABOVE, SUCH EVENT OR CONDITION, TOGETHER WITH ALL OTHER
SUCH EVENTS OR CONDITIONS, IF ANY, COULD, IN THE SOLE JUDGMENT OF THE REQUIRED
LENDERS, REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT; OR

 

(H) ONE OR MORE JUDGMENTS OR DECREES SHALL BE ENTERED AGAINST ANY GROUP MEMBER
INVOLVING IN THE AGGREGATE A LIABILITY (NOT PAID OR FULLY COVERED BY INSURANCE
AS TO WHICH THE RELEVANT INSURANCE COMPANY HAS ACKNOWLEDGED COVERAGE) OF
$2,750,000 OR MORE, WHICH SUCH JUDGMENTS OR DECREES SHALL NOT HAVE BEEN VACATED,
DISCHARGED, STAYED OR BONDED PENDING APPEAL WITHIN 30 DAYS FROM THE ENTRY
THEREOF; OR

 

(I) ANY OF THE SECURITY DOCUMENTS SHALL CEASE, FOR ANY REASON, TO BE IN FULL
FORCE AND EFFECT, OR ANY LOAN PARTY OR ANY AFFILIATE OF ANY LOAN PARTY SHALL SO
ASSERT, OR ANY LIEN CREATED BY ANY OF THE SECURITY DOCUMENTS SHALL CEASE TO BE
ENFORCEABLE AND OF THE SAME EFFECT AND PRIORITY PURPORTED TO BE CREATED THEREBY;
OR

 

(J) THE GUARANTEE CONTAINED IN SECTION 2 OF THE GUARANTEE AND COLLATERAL
AGREEMENT SHALL CEASE, FOR ANY REASON, TO BE IN FULL FORCE AND EFFECT OR ANY
LOAN PARTY OR ANY AFFILIATE OF ANY LOAN PARTY SHALL SO ASSERT; OR

 

(K) (I) (A) THE PERMITTED INVESTORS SHALL CEASE TO OWN OF RECORD AND
BENEFICIALLY AT LEAST A MAJORITY OF THE OUTSTANDING COMMON STOCK OF THE BORROWER
AND (B) ANY “PERSON” OR “GROUP” (AS SUCH TERMS ARE USED IN SECTIONS 13(D) AND
14(D) OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED (THE “EXCHANGE ACT”)),
EXCLUDING THE PERMITTED INVESTORS, SHALL BECOME, OR OBTAIN RIGHT (WHETHER BY
MEANS OF WARRANTS, OPTIONS OR OTHERWISE) TO BECOME, THE “BENEFICIAL OWNER” (AS
DEFINED IN RULES 13(D)-3 AND 13(D)-5 UNDER THE EXCHANGE ACT), DIRECTLY OR
INDIRECTLY, OF MORE THAN 25% OF THE OUTSTANDING COMMON STOCK OF THE BORROWER;
(II) THE PERMITTED INVESTORS SHALL CEASE TO OWN OF RECORD AND BENEFICIALLY AT
LEAST 40% OF THE OUTSTANDING AMOUNT OF COMMON STOCK OF THE BORROWER;
(III) CONTINUING DIRECTORS SHALL CEASE TO CONSTITUTE A MAJORITY OF THE BOARD OF
DIRECTORS OF THE BORROWER SHALL CEASE TO CONSIST OF A MAJORITY OF CONTINUING
DIRECTORS; OR (IV) A SPECIFIED CHANGE OF CONTROL SHALL OCCUR; OR

 

(L) THE SUBORDINATED LOANS OR THE GUARANTEES THEREOF SHALL CEASE, FOR ANY REASON
(OTHER THAN AS A RESULT OF ANY AMENDMENT OR WAIVER PURSUANT TO SECTION 11.1 OR
ANY AMENDMENT OR WAIVER PURSUANT TO SECTION 20 OF THE SUBORDINATION AGREEMENT),
TO BE VALIDLY SUBORDINATED TO THE OBLIGATIONS UNDER THE LOAN DOCUMENTS AS
PROVIDED IN THE SUBORDINATION AGREEMENT, OR ANY LOAN PARTY, ANY AFFILIATE OF ANY
LOAN PARTY OR ANY HOLDER OF SUBORDINATED LOANS SHALL SO ASSERT;

 

then, and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (f) above with respect to the Borrower,
automatically the Term Loan Commitments shall immediately terminate and the Term
Loans hereunder (with accrued interest thereon) and all other amounts owing
under this Agreement and the other Loan Documents shall immediately become due
and payable, and (B) if such event is any other Event of Default, the following
action may be taken:  with the consent of the Required Lenders, the
Administrative Agent may,

 

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or upon the request of the Required Lenders, the Administrative Agent shall, by
notice to the Borrower, declare the Term Loans hereunder (with accrued interest
thereon) and all other amounts owing under this Agreement and the other Loan
Documents to be due and payable forthwith, whereupon the same shall immediately
become due and payable.  Except as expressly provided above in this Section,
presentment, demand, protest and all other notices of any kind are hereby
expressly waived by the Borrower.

 

SECTION 10.   THE AGENTS

 

10.1.        Appointment.  Each Lender hereby irrevocably designates and
appoints each Agent as the agent of such Lender under this Agreement and the
other Loan Documents, and each such Lender irrevocably authorizes such Agent, in
such capacity, to take such action on its behalf under the provisions of this
Agreement and the other Loan Documents and to exercise such powers and perform
such duties as are expressly delegated to such Agent by the terms of this
Agreement and the other Loan Documents, together with such other powers as are
reasonably incidental thereto.   Notwithstanding any provision to the contrary
elsewhere in this Agreement, no Agent shall have any duties or responsibilities,
except those expressly set forth herein, or any fiduciary relationship with any
Lender, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other Loan
Document or otherwise exist against any Agent.

 

10.2.        Delegation of Duties.  Each Agent may execute any of its duties
under this Agreement and the other Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties.  No Agent shall be responsible for the
negligence or misconduct of any agents or attorneys in-fact selected by it with
reasonable care.

 

10.3.        Exculpatory Provisions.  Neither any Agent nor any of their
respective officers, directors, employees, agents, attorneys-in-fact or
affiliates shall be (i) liable for any action lawfully taken or omitted to be
taken by it or such Person under or in connection with this Agreement or any
other Loan Document (except to the extent that any of the foregoing are found by
a final and nonappealable decision of a court of competent jurisdiction to have
resulted from its or such Person’s own gross negligence or willful misconduct)
or (ii) responsible in any manner to any of the Lenders for any recitals,
statements, representations or warranties made by any Loan Party or any officer
thereof contained in this Agreement or any other Loan Document or in any
certificate, report, statement or other document referred to or provided for in,
or received by the Agents under or in connection with, this Agreement or any
other Loan Document or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Loan Document or
for any failure of any Loan Party a party thereto to perform its obligations
hereunder or thereunder.  The Agents shall not be under any obligation to any
Lender to ascertain or to inquire as to the observance or performance of any of
the agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of any Loan Party.

 

10.4.        Reliance by Agents.  Each Agent shall be entitled to rely, and
shall be fully protected in relying, upon any instrument, writing, resolution,
notice, consent, certificate, affidavit, letter, telecopy, telex or teletype
message, statement, order or other document or

 

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conversation believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person or Persons and upon advice and statements of
legal counsel (including counsel to the Borrower), independent accountants and
other experts selected by such Agent.  The Administrative Agent may deem and
treat the payee of any Note as the owner thereof for all purposes unless a
written notice of assignment, negotiation or transfer thereof shall have been
filed with the Administrative Agent.  Each Agent shall be fully justified in
failing or refusing to take any action under this Agreement or any other Loan
Document unless it shall first receive such advice or concurrence of the
Required Lenders (or, if so specified by this Agreement, all Lenders) as it
deems appropriate or it shall first be indemnified to its satisfaction by the
Lenders against any and all liability and expense that may be incurred by it by
reason of taking or continuing to take any such action.  The Agents shall in all
cases be fully protected in acting, or in refraining from acting, under this
Agreement and the other Loan Documents in accordance with a request of the
Required Lenders (or, if so specified by this Agreement, all Lenders), and such
request and any action taken or failure to act pursuant thereto shall be binding
upon all the Lenders and all future holders of the Loans.

 

10.5.        Notice of Default.  No Agent shall be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default hereunder unless
such Agent has received notice from a Lender or the Borrower referring to this
Agreement, describing such Default or Event of Default and stating that such
notice is a “notice of default”.  In the event that the Administrative Agent
receives such a notice, the Administrative Agent shall give notice thereof to
the Lenders.  The Administrative Agent shall take such action with respect to
such Default or Event of Default as shall be reasonably directed by the Required
Lenders (or, if so specified by this Agreement, all Lenders or any other
instructing group of Lenders specified by this Agreement); provided that unless
and until the Administrative Agent shall have received such directions, the
Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interests of the Lenders.

 

10.6.        Non-Reliance on Agents and Other Lenders.  Each Lender expressly
acknowledges that neither the Agents nor any of their respective officers,
directors, employees, agents, attorneys-in-fact or affiliates have made any
representations or warranties to it and that no act by any Agent hereafter
taken, including any review of the affairs of a Loan Party or any affiliate of a
Loan Party, shall be deemed to constitute any representation or warranty by any
Agent to any Lender.  Each Lender represents to the Agents that it has,
independently and without reliance upon any Agent or any other Lender, and based
on such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Loan Parties and their
affiliates and made its own decision to make its Loans hereunder and enter into
this Agreement.  Each Lender also represents that it will, independently and
without reliance upon any Agent or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit analysis, appraisals and decisions in taking or not taking action
under this Agreement and the other Loan Documents, and to make such
investigation as it deems necessary to inform itself as to the business,
operations, property, financial and other condition and creditworthiness of the
Loan Parties and their affiliates.  Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall not have any duty
or

 

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responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness of any Loan Party or any affiliate of
a Loan Party that may come into the possession of the Administrative Agent or
any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates.

 

10.7.        Indemnification.  The Lenders agree to indemnify each Agent in its
capacity as such (to the extent not reimbursed by the Borrower and without
limiting the obligation of the Borrower to do so), ratably according to their
respective Aggregate Exposure Percentages in effect on the date on which
indemnification is sought under this Section (or, if indemnification is sought
after the date upon which the Commitments shall have terminated and the Loans
shall have been paid in full, ratably in accordance with such Aggregate Exposure
Percentages immediately prior to such date), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever that may at any time
(whether before or after the payment of the Loans) be imposed on, incurred by or
asserted against such Agent in any way relating to or arising out of, the
Commitments, this Agreement, any of the other Loan Documents or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by such Agent
under or in connection with any of the foregoing; provided that no Lender shall
be liable for the payment of any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements that are found by a final and nonappealable decision of a court of
competent jurisdiction to have resulted from such Agent’s gross negligence or
willful misconduct.  The agreements in this Section shall survive the payment of
the Loans and all other amounts payable hereunder.

 

10.8.        Agent in Its Individual Capacity.  Each Agent and its affiliates
may make loans to, accept deposits from and generally engage in any kind of
business with any Loan Party as though such Agent were not an Agent.  With
respect to its Loans made or renewed by it and with respect to any Letter of
Credit issued or participated in by it, each Agent shall have the same rights
and powers under this Agreement and the other Loan Documents as any Lender and
may exercise the same as though it were not an Agent, and the terms “Lender” and
“Lenders” shall include each Agent in its individual capacity.

 

10.9.        Successor Administrative Agent.  The Administrative Agent may
resign as Administrative Agent upon 10 days’ notice to the Lenders and the
Borrower.  If the Administrative Agent shall resign as Administrative Agent
under this Agreement and the other Loan Documents, then the Required Lenders
shall appoint from among the Lenders a successor agent for the Lenders, which
successor agent shall (unless an Event of Default under Section 9(a) or
Section 9(f) with respect to the Borrower shall have occurred and be continuing)
be subject to approval by the Borrower (which approval shall not be unreasonably
withheld or delayed), whereupon such successor agent shall succeed to the
rights, powers and duties of the Administrative Agent, and the term
“Administrative Agent” shall mean such successor agent effective upon such
appointment and approval, and the former Administrative Agent’s rights, powers
and duties as Administrative Agent shall be terminated, without any other or
further act or deed on the part of such former Administrative Agent or any of
the parties to this Agreement or any holders of the Loans.  If no successor
agent has accepted appointment as Administrative

 

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Agent by the date that is 10 days following a retiring Administrative Agent’s
notice of resignation, the retiring Administrative Agent’s resignation shall
nevertheless thereupon become effective and the Lenders shall assume and perform
all of the duties of the Administrative Agent hereunder until such time, if any,
as the Required Lenders appoint a successor agent as provided for above.  After
any retiring Administrative Agent’s resignation as Administrative Agent, the
provisions of this Section 10 shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was Administrative Agent under this
Agreement and the other Loan Documents.

 

10.10.      Agents Generally.  Except as expressly set forth herein, no Agent
shall have any duties or responsibilities hereunder in its capacity as such.

 

10.11.      The Lead Arranger.  The Lead Arranger, in its capacity as such,
shall have no duties or responsibilities, and shall incur no liability, under
this Agreement and other Loan Documents..

 

SECTION 11.   MISCELLANEOUS

 

11.1.        Amendments and Waivers.  Neither this Agreement, any other Loan
Document, nor any terms hereof or thereof may be amended, supplemented or
modified except in accordance with the provisions of this Section 11.1.  The
Required Lenders and each Loan Party party to the relevant Loan Document may,
or, with the written consent of the Required Lenders, the Administrative Agent
and each Loan Party party to the relevant Loan Document may, from time to time,
(a) enter into written amendments, supplements or modifications hereto and to
the other Loan Documents for the purpose of adding any provisions to this
Agreement or the other Loan Documents or changing in any manner the rights of
the Lenders or of the Loan Parties hereunder or thereunder or (b) waive, on such
terms and conditions as the Required Lenders or the Administrative Agent, as the
case may be, may specify in such instrument, any of the requirements of this
Agreement or the other Loan Documents or any Default or Event of Default and its
consequences; provided, however, that no such waiver and no such amendment,
supplement or modification shall:

 

(I)            FORGIVE THE PRINCIPAL AMOUNT OR EXTEND THE FINAL SCHEDULED DATE
OF MATURITY OF ANY TERM LOAN, EXTEND THE SCHEDULED DATE OF ANY AMORTIZATION
PAYMENT IN RESPECT OF ANY TERM LOAN, REDUCE THE STATED RATE OF ANY INTEREST OR
FEE PAYABLE HEREUNDER (EXCEPT (X) IN CONNECTION WITH THE WAIVER OF APPLICABILITY
OF ANY POST-DEFAULT INCREASE IN INTEREST RATES, WHICH WAIVER SHALL BE EFFECTIVE
WITH THE CONSENT OF THE REQUIRED LENDERS) AND (Y) THAT ANY AMENDMENT OR
MODIFICATION OF DEFINED TERMS USED IN THE FINANCIAL COVENANTS IN THIS AGREEMENT
SHALL NOT CONSTITUTE A REDUCTION IN THE RATE OF INTEREST OR FEES FOR PURPOSES OF
THIS CLAUSE (I)) OR EXTEND THE SCHEDULED DATE OF ANY PAYMENT THEREOF WITHOUT THE
WRITTEN CONSENT OF EACH LENDER AFFECTED THEREBY;

 

(II)           RELEASE ALL OR SUBSTANTIALLY ALL OF THE COLLATERAL UNDER THE
SECURITY DOCUMENTS OR RELEASE ALL OR SUBSTANTIALLY ALL OF THE SUBSIDIARY
GUARANTORS FROM THEIR OBLIGATIONS, IN EACH CASE WITHOUT THE WRITTEN CONSENT OF
ALL THE LENDERS;

 

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(III)          ELIMINATE OR REDUCE THE VOTING RIGHTS OF ANY LENDER UNDER THIS
SECTION 11.1 WITHOUT THE WRITTEN CONSENT OF SUCH LENDER;

 

(IV)          REDUCE ANY PERCENTAGE SPECIFIED IN THE DEFINITION OF REQUIRED
LENDERS OR CONSENT TO THE ASSIGNMENT OR TRANSFER BY THE BORROWER OF ANY OF ITS
RIGHTS AND OBLIGATIONS UNDER THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, IN
EACH CASE WITHOUT THE WRITTEN CONSENT OF ALL LENDERS;

 

(V)           SUBJECT TO THE FOLLOWING TWO PARAGRAPHS OF THIS SECTION 11.1,
AMEND, MODIFY OR WAIVE ANY PROVISION OF SECTION 4.8 WITHOUT THE WRITTEN CONSENT
OF THE REQUIRED LENDERS, PROVIDED, THAT ANY AMENDMENT, MODIFICATION OR WAIVER OF
SECTION 4.8 WHICH CHANGES THE PRO RATA PROVISION THEREIN SHALL REQUIRE THE
WRITTEN CONSENT OF EACH LENDER ADVERSELY AFFECTED THEREBY;

 

(VI)          REDUCE THE AMOUNT OF NET CASH PROCEEDS OR EXCESS CASH FLOW
REQUIRED TO BE APPLIED TO PREPAY TERM LOANS UNDER THIS AGREEMENT WITHOUT THE
WRITTEN CONSENT OF THE REQUIRED LENDERS;

 

(VII)         AMEND, MODIFY OR WAIVE ANY PROVISION OF SECTION 10 WITHOUT THE
WRITTEN CONSENT OF EACH AGENT ADVERSELY AFFECTED THEREBY; AND

 

(VIII)        AMEND, MODIFY OR WAIVE SECTION 6.5 OF THE GUARANTEE AND COLLATERAL
AGREEMENT SO AS TO ALTER THE RATABLE TREATMENT OF THE SECOND LIEN OBLIGATIONS
WITH RESPECT TO THE LOAN DOCUMENTS, THE SPECIFIED HEDGE AGREEMENTS AND THE
SPECIFIED CASH MANAGEMENT AGREEMENTS, IN A MANNER ADVERSE TO ANY SECOND LIEN
QUALIFIED COUNTERPARTY WITH SECOND LIEN OBLIGATIONS THEN OUTSTANDING WITHOUT THE
WRITTEN CONSENT OF ANY SUCH SECOND LIEN QUALIFIED COUNTERPARTY.

 

Any such waiver and any such amendment, supplement or modification shall apply
equally to each of the Lenders and shall be binding upon the Loan Parties, the
Lenders, the Agents and all future holders of the Term Loans.  In the case of
any waiver, the Loan Parties, the Lenders and the Agents shall be restored to
their former position and rights hereunder and under the other Loan Documents,
and any Default or Event of Default waived shall be deemed to be cured and not
continuing; but no such waiver shall extend to any subsequent or other Default
or Event of Default, or impair any right consequent thereon.

 

Notwithstanding the foregoing, this Agreement may be amended (or amended and
restated) with the written consent of the Required Lenders, the Administrative
Agent and the Borrower (a) to add one or more additional credit facilities to
this Agreement and to permit the extensions of credit from time to time
outstanding thereunder and the accrued interest and fees in respect thereof
(collectively, the “Additional Extensions of Credit”) to share ratably in the
benefits of this Agreement and the other Loan Documents with the Term Loans and
the accrued interest and fees in respect thereof and (b) to include
appropriately the Lenders holding such credit facilities in any determination of
the Required Lenders.

 

In addition, notwithstanding the foregoing, this Agreement may be amended with
the written consent of the Administrative Agent, the Borrower and the Lenders
providing the

 

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relevant Replacement Term Loans (as defined below) to permit the refinancing of
all outstanding Term Loans (“Refinanced Term Loans”) with a replacement term
loan tranche hereunder (“Replacement Term Loans”), provided that (a) the
aggregate principal amount of such Replacement Term Loans shall not exceed the
aggregate principal amount of such Refinanced Term Loans, (b) the Applicable
Margin for such Replacement Term Loans shall not be higher than the Applicable
Margin for such Refinanced Term Loans, (c) the weighted average life to maturity
of such Replacement Term Loans shall not be shorter than the weighted average
life to maturity of such Refinanced Term Loans at the time of such refinancing
and (d) all other terms applicable to such Replacement Term Loans shall be
substantially identical to, or less favorable to the Lenders providing such
Replacement Term Loans than, those applicable to such Refinanced Term Loans,
except to the extent necessary to provide for covenants and other terms
applicable to any period after the latest final maturity of the Term Loans in
effect immediately prior to such refinancing.

 

Notwithstanding the foregoing, any provision of this Agreement may be amended by
an agreement in writing entered into by the Borrower, the Required Lenders and
the Administrative Agent if (i) by the terms of such agreement the Term Loan
Commitment of each Lender not consenting to the amendment provided for therein
shall terminate upon the effectiveness of such amendment and (ii) at the time
such amendment becomes effective, each Lender not consenting thereto receives
payment in full of the principal of and interest accrued on each Term Loan made
by it and all other amounts owing to it or accrued for its account under this
Agreement.

 

11.2.        Notices.  All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
telecopy), and, unless otherwise expressly provided herein, shall be deemed to
have been duly given or made when delivered, or three Business Days after being
deposited in the mail, postage prepaid, or, in the case of telecopy notice, when
received, addressed as follows in the case of the Borrower and the Agents, and
as set forth in an administrative questionnaire delivered to the Administrative
Agent in the case of the Lenders, or to such other address as may be hereafter
notified by the respective parties hereto:

 

The Borrower:

 

New World Restaurant Group, Inc.
1687 Cole Boulevard
Golden, CO 80401

 

 

Attention:

Richard P. Dutkiewicz, Chief
Financial Officer

 

 

Telecopy:

(303) 568-8402

 

 

Telephone: (303) 568-8004

 

 

 

The Administrative Agent:

 

Bear Stearns Corporate Lending Inc.
383 Madison Avenue
New York, New York 10179

 

 

Attention:

Bram Smith

 

 

Telecopy:

(917) 849-1542

 

 

Telephone: (212) 272-3669

 

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provided that any notice, request or demand to or upon any Agent, the Issuing
Lender or the Lenders shall not be effective until received.

 

Notices and other communications to the Lenders hereunder may be delivered or
furnished by electronic communications pursuant to procedures approved by the
Administrative Agent; provided that the foregoing shall not apply to notices
pursuant to Section 2 unless otherwise agreed by the Administrative Agent and
the applicable Lender.  The Administrative Agent or the Borrower may, in its
discretion, agree to accept notices and other communications to it hereunder by
electronic communications pursuant to procedures approved by it; provided that
approval of such procedures may be limited to particular notices or
communications.

 

11.3.        No Waiver; Cumulative Remedies.  No failure to exercise and no
delay in exercising, on the part of any Agent or any Lender, any right, remedy,
power or privilege hereunder or under the other Loan Documents shall operate as
a waiver thereof; nor shall any single or partial exercise of any right, remedy,
power or privilege hereunder preclude any other or further exercise thereof or
the exercise of any other right, remedy, power or privilege.  The rights,
remedies, powers and privileges herein provided are cumulative and not exclusive
of any rights, remedies, powers and privileges provided by law.

 

11.4.        Survival of Representations and Warranties.  All representations
and warranties made hereunder, in the other Loan Documents and in any document,
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Agreement and the making of the
Term Loans and other extensions of credit hereunder.

 

11.5.        Payment of Expenses and Taxes.  The Borrower agrees (a) to pay or
reimburse each Agent for all its reasonable out-of-pocket costs and expenses
incurred in connection with the development, preparation and execution of, and
any amendment, supplement or modification to, this Agreement and the other Loan
Documents and any other documents prepared in connection herewith or therewith,
and the consummation and administration of the transactions contemplated hereby
and thereby, including the reasonable fees and disbursements of counsel to each
Agent and filing and recording fees and expenses, with statements with respect
to the foregoing initially expected (assuming the Closing Date occurs) to be
submitted to the Borrower prior to the Initial Borrowing Date (in the case of
amounts to be paid on the Initial Borrowing Date) and from time to time
thereafter on a quarterly basis or such other periodic basis as such Agent shall
deem appropriate, (b) to pay or reimburse each Lender and each Agent for all its
costs and expenses incurred in connection with the enforcement or preservation
of any rights under this Agreement, the other Loan Documents and any such other
documents, including the fees and disbursements of counsel (including the
allocated fees and expenses of in-house counsel) to each Lender and of counsel
to such Agent, (c) to pay, indemnify, and hold each Lender and each Agent
harmless from, any and all recording and filing fees and any and all liabilities
with respect to, or resulting from any delay in paying, stamp, excise and other
taxes, if any, that may be payable or determined to be payable in connection
with the execution and delivery of, or consummation or administration of any of
the transactions contemplated by, or any amendment, supplement or modification
of, or any waiver or consent under or in respect of, this Agreement, the other
Loan Documents and any such other documents, and (d) to pay, indemnify, and hold
each Lender and each Agent and their respective officers, directors,

 

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employees, affiliates, agents and controlling persons (each, an “Indemnitee”)
harmless from and against any and all other liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever with respect to the execution, delivery,
enforcement, performance and administration of this Agreement, the other Loan
Documents (regardless of whether any Loan Party is or is not a party to any such
actions or suits) and any such other documents, including any of the foregoing
relating to the use of proceeds of the Term Loans or the violation of,
noncompliance with or liability under, any Environmental Law applicable to the
operations of any Group Member or any of the Properties and the reasonable fees
and expenses of legal counsel in connection with claims, actions or proceedings
by any Indemnitee against any Loan Party under any Loan Document (all the
foregoing in this clause (d), collectively, the “Indemnified Liabilities”),
provided, that the Borrower shall have no obligation hereunder to any Indemnitee
with respect to Indemnified Liabilities to the extent such Indemnified
Liabilities are found by a final and nonappealable decision of a court of
competent jurisdiction to have resulted from the gross negligence or willful
misconduct of such Indemnitee.  Without limiting the foregoing, and to the
extent permitted by applicable law, the Borrower agrees not to assert and to
cause its Subsidiaries not to assert, and hereby waives and agrees to cause its
Subsidiaries to waive, all rights for contribution or any other rights of
recovery with respect to all claims, demands, penalties, fines, liabilities,
settlements, damages, costs and expenses of whatever kind or nature, under or
related to Environmental Laws, that any of them might have by statute or
otherwise against any Indemnitee.  All amounts due under this Section 11.5 shall
be payable not later than ten days after written demand therefor.  Statements
payable by the Borrower pursuant to this Section 11.5 shall be submitted to
Chief Financial Officer (Telephone No. (303) 568-8004) (Telecopy No. (303)
568-8402), at the address of the Borrower set forth in Section 11.2, or to such
other Person or address as may be hereafter designated by the Borrower in a
written notice to the Administrative Agent.  The agreements in this Section 11.5
shall survive repayment of the Term Loans and all other amounts payable
hereunder.

 

11.6.        Successors and Assigns; Participations and Assignments.  (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 (i) the Borrower may not assign or otherwise transfer any of its
rights or obligations hereunder without the prior written consent of each Lender
(and any attempted assignment or transfer by the Borrower without such consent
shall be null and void) and (ii) no Lender may assign or otherwise transfer its
rights or obligations hereunder except in accordance with this Section.

 

(B)           (I)  SUBJECT TO THE CONDITIONS SET FORTH IN
PARAGRAPH (B)(II) BELOW, ANY LENDER MAY ASSIGN TO ONE OR MORE ASSIGNEES (EACH,
AN “ASSIGNEE”) ALL OR A PORTION OF ITS RIGHTS AND OBLIGATIONS UNDER THIS
AGREEMENT (INCLUDING ALL OR A PORTION OF ITS TERM LOAN COMMITMENTS AND THE TERM
LOANS AT THE TIME OWING TO IT) WITH THE PRIOR WRITTEN CONSENT (ANY SUCH CONSENT
NOT TO BE UNREASONABLY WITHHELD) OF:

 

(A) THE BORROWER, PROVIDED THAT NO CONSENT OF THE BORROWER SHALL BE REQUIRED FOR
AN (X) ASSIGNMENT TO A LENDER, AN AFFILIATE OF A LENDER, AN APPROVED FUND (AS
DEFINED BELOW) OR, IF AN EVENT OF DEFAULT UNDER SECTION 9(A) OR (F) HAS OCCURRED
AND IS CONTINUING, ANY OTHER PERSON, (Y) ANY ASSIGNMENT BY THE ADMINISTRATIVE
AGENT OR THE LEAD ARRANGER (OR

 

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THEIR AFFILIATES), PROVIDED THAT ANY SUCH ASSIGNMENT OF A TERM LOAN COMMITMENT
PURSUANT TO THIS CLAUSE (Y) SHALL REQUIRE THE CONSENT OF THE BORROWER (SUCH
CONSENT NOT TO BE UNREASONABLY WITHHELD) UNLESS SUCH ASSIGNMENT IS MADE IN
CONNECTION WITH THE PRIMARY SYNDICATION OF THE FACILITIES TO A PERSON DISCLOSED
TO THE BORROWER PRIOR TO THE CLOSING DATE OR (Z) ANY ASSIGNMENT OF TERM LOANS;
AND

 

(B) THE ADMINISTRATIVE AGENT, PROVIDED THAT NO CONSENT OF THE ADMINISTRATIVE
AGENT SHALL BE REQUIRED FOR (X) AN ASSIGNMENT TO AN ASSIGNEE THAT IS A LENDER
IMMEDIATELY PRIOR TO GIVING EFFECT TO SUCH ASSIGNMENT, (Y) ANY ASSIGNMENT BY THE
ADMINISTRATIVE AGENT (OR ITS AFFILIATES) OR (Z) ANY ASSIGNMENT OF TERM LOANS.

 

(II)           ASSIGNMENTS SHALL BE SUBJECT TO THE FOLLOWING ADDITIONAL
CONDITIONS:

 

(A) EXCEPT IN THE CASE OF AN ASSIGNMENT TO A LENDER, AN AFFILIATE OF A LENDER OR
AN APPROVED FUND OR AN ASSIGNMENT OF THE ENTIRE REMAINING AMOUNT OF THE
ASSIGNING LENDER’S TERM LOAN COMMITMENTS OR TERM LOANS UNDER ANY FACILITY, THE
AMOUNT OF THE TERM LOAN COMMITMENTS OR TERM LOANS OF THE ASSIGNING LENDER
SUBJECT TO EACH SUCH ASSIGNMENT (DETERMINED AS OF THE DATE THE ASSIGNMENT AND
ASSUMPTION WITH RESPECT TO SUCH ASSIGNMENT IS DELIVERED TO THE ADMINISTRATIVE
AGENT) SHALL NOT BE LESS THAN $1,000,000 AND, AFTER GIVING EFFECT THERETO, THE
ASSIGNING LENDER (IF IT SHALL RETAIN ANY TERMS LOANS) SHALL HAVE TERM LOAN
COMMITMENTS AND TERM LOANS AGGREGATING AT LEAST $1,000,000, UNLESS EACH OF THE
BORROWER AND THE ADMINISTRATIVE AGENT OTHERWISE CONSENT, PROVIDED THAT (1) NO
SUCH CONSENT OF THE BORROWER SHALL BE REQUIRED IF AN EVENT OF DEFAULT UNDER
SECTION 9(A) OR (F) HAS OCCURRED AND IS CONTINUING AND (2) SUCH AMOUNTS SHALL BE
AGGREGATED IN RESPECT OF EACH LENDER AND ITS AFFILIATES OR APPROVED FUNDS, IF
ANY;

 

(B) THE PARTIES TO EACH ASSIGNMENT SHALL EXECUTE AND DELIVER TO THE
ADMINISTRATIVE AGENT AN ASSIGNMENT AND ASSUMPTION, AND, SUBJECT TO SECTION 4.13,
THE ASSIGNING LENDER OR THE ASSIGNEE LENDER SHALL PAY A PROCESSING AND
RECORDATION FEE OF $3,500 (EXCEPT FOR THE ADMINISTRATIVE AGENT, THE LEAD
ARRANGER AND ANY OF THEIR AFFILIATES AND THE BORROWER AND EXCEPT FOR ASSIGNMENTS
BY A LENDER TO ANY OF ITS AFFILIATES OR APPROVED FUNDS);

 

(C) THE ASSIGNEE, IF IT SHALL NOT BE A LENDER, SHALL DELIVER TO THE
ADMINISTRATIVE AGENT AN ADMINISTRATIVE QUESTIONNAIRE; AND

 

(D) IN THE CASE OF AN ASSIGNMENT BY A LENDER TO A CLO RELATED TO SUCH LENDER (AS
DEFINED BELOW), THE ASSIGNING LENDER SHALL RETAIN THE SOLE RIGHT TO APPROVE ANY
AMENDMENT, MODIFICATION OR WAIVER OF ANY PROVISION OF THIS AGREEMENT AND THE
OTHER LOAN DOCUMENTS, PROVIDED THAT THE

 

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ASSIGNMENT AND ASSUMPTION BETWEEN SUCH LENDER AND SUCH CLO MAY PROVIDE THAT SUCH
LENDER WILL NOT, WITHOUT THE CONSENT OF SUCH CLO, AGREE TO ANY AMENDMENT,
MODIFICATION OR WAIVER THAT (1) REQUIRES THE CONSENT OF EACH LENDER DIRECTLY
AFFECTED THEREBY PURSUANT TO THE PROVISO TO THE SECOND SENTENCE OF SECTION 11.1
AND (2) DIRECTLY AFFECTS SUCH CLO.

 

For the purposes of this Section 11.6, the terms “Approved Fund” and “CLO” have
the following meanings:

 

“Approved Fund” means (a) a CLO and (b) with respect to any Lender that is a
fund which invests in bank loans and similar extensions of credit, any other
fund that invests in bank loans and similar extensions of credit and is managed
by the same investment advisor as such Lender or by an affiliate of such
investment advisor.

 

“CLO” means any entity (whether a corporation, partnership, trust or otherwise)
that is engaged in making, purchasing, holding or otherwise investing in bank
loans and similar extensions of credit in the ordinary course of its business
and is administered or managed by a Lender or an affiliate of such Lender.

 

(III)          SUBJECT TO ACCEPTANCE AND RECORDING THEREOF PURSUANT TO
PARAGRAPH (B)(IV) BELOW, FROM AND AFTER THE EFFECTIVE DATE SPECIFIED IN EACH
ASSIGNMENT AND ASSUMPTION THE ASSIGNEE THEREUNDER SHALL BE A PARTY HERETO AND,
TO THE EXTENT OF THE INTEREST ASSIGNED BY SUCH ASSIGNMENT AND ASSUMPTION, HAVE
THE RIGHTS AND OBLIGATIONS OF A LENDER UNDER THIS AGREEMENT, AND THE ASSIGNING
LENDER THEREUNDER SHALL, TO THE EXTENT OF THE INTEREST ASSIGNED BY SUCH
ASSIGNMENT AND ASSUMPTION, BE RELEASED FROM ITS OBLIGATIONS UNDER THIS AGREEMENT
(AND, IN THE CASE OF AN ASSIGNMENT AND ASSUMPTION COVERING ALL OF THE ASSIGNING
LENDER’S RIGHTS AND OBLIGATIONS UNDER THIS AGREEMENT, SUCH LENDER SHALL CEASE TO
BE A PARTY HERETO BUT SHALL CONTINUE TO BE ENTITLED TO THE BENEFITS OF
SECTIONS 4.9, 4.10, 4.11 AND 10.5).  ANY ASSIGNMENT OR TRANSFER BY A LENDER OF
RIGHTS OR OBLIGATIONS UNDER THIS AGREEMENT THAT DOES NOT COMPLY WITH THIS
SECTION 11.6 SHALL BE TREATED FOR PURPOSES OF THIS AGREEMENT AS A SALE BY SUCH
LENDER OF A PARTICIPATION IN SUCH RIGHTS AND OBLIGATIONS IN ACCORDANCE WITH
PARAGRAPH (C) OF THIS SECTION.

 

(IV)          THE ADMINISTRATIVE AGENT, ACTING FOR THIS PURPOSE AS AN AGENT OF
THE BORROWER, SHALL MAINTAIN AT ONE OF ITS OFFICES A COPY OF EACH ASSIGNMENT AND
ASSUMPTION DELIVERED TO IT AND A REGISTER FOR THE RECORDATION OF THE NAMES AND
ADDRESSES OF THE LENDERS, AND THE TERM LOAN COMMITMENTS OF, AND PRINCIPAL AMOUNT
OF THE TERM LOANS OWING TO, EACH LENDER PURSUANT TO THE TERMS HEREOF FROM TIME
TO TIME (THE “REGISTER”).  THE ENTRIES IN THE REGISTER SHALL BE CONCLUSIVE, AND
THE BORROWER, THE ADMINISTRATIVE AGENT, AND THE LENDERS MAY TREAT EACH PERSON
WHOSE NAME IS RECORDED IN THE REGISTER PURSUANT TO THE TERMS HEREOF AS A LENDER
HEREUNDER FOR ALL PURPOSES OF THIS AGREEMENT, NOTWITHSTANDING NOTICE TO THE
CONTRARY.  THE REGISTER SHALL BE AVAILABLE FOR INSPECTION BY THE BORROWER AND
ANY LENDER, AT ANY REASONABLE TIME AND FROM TIME TO TIME UPON REASONABLE PRIOR
NOTICE.

 

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(V)           UPON ITS RECEIPT OF A DULY COMPLETED ASSIGNMENT AND ASSUMPTION
EXECUTED BY AN ASSIGNING LENDER AND AN ASSIGNEE, THE ASSIGNEE’S COMPLETED
ADMINISTRATIVE QUESTIONNAIRE (UNLESS THE ASSIGNEE SHALL ALREADY BE A LENDER
HEREUNDER) AND ANY WRITTEN CONSENT TO SUCH ASSIGNMENT REQUIRED BY
PARAGRAPH (B) OF THIS SECTION, THE ADMINISTRATIVE AGENT SHALL ACCEPT SUCH
ASSIGNMENT AND ASSUMPTION AND RECORD THE INFORMATION CONTAINED THEREIN IN THE
REGISTER.  NO ASSIGNMENT SHALL BE EFFECTIVE FOR PURPOSES OF THIS AGREEMENT
UNLESS IT HAS BEEN RECORDED IN THE REGISTER AS PROVIDED IN THIS PARAGRAPH.

 

(C)           (I)  ANY LENDER MAY, WITHOUT THE CONSENT OF THE BORROWER OR THE
ADMINISTRATIVE AGENT, SELL PARTICIPATIONS TO ONE OR MORE BANKS OR OTHER ENTITIES
(A “PARTICIPANT”) IN ALL OR A PORTION OF SUCH LENDER’S RIGHTS AND OBLIGATIONS
UNDER THIS AGREEMENT (INCLUDING ALL OR A PORTION OF ITS TERM LOAN COMMITMENTS
AND THE TERM LOANS OWING TO IT); PROVIDED THAT (A) SUCH LENDER’S OBLIGATIONS
UNDER THIS AGREEMENT SHALL REMAIN UNCHANGED, (B) SUCH LENDER SHALL REMAIN SOLELY
RESPONSIBLE TO THE OTHER PARTIES HERETO FOR THE PERFORMANCE OF SUCH OBLIGATIONS
AND (C) THE BORROWER, THE ADMINISTRATIVE AGENT, AND THE OTHER LENDERS SHALL
CONTINUE TO DEAL SOLELY AND DIRECTLY WITH SUCH LENDER IN CONNECTION WITH SUCH
LENDER’S RIGHTS AND OBLIGATIONS UNDER THIS AGREEMENT.  ANY AGREEMENT PURSUANT TO
WHICH A LENDER SELLS SUCH A PARTICIPATION SHALL PROVIDE THAT SUCH LENDER SHALL
RETAIN THE SOLE RIGHT TO ENFORCE THIS AGREEMENT AND TO APPROVE ANY AMENDMENT,
MODIFICATION OR WAIVER OF ANY PROVISION OF THIS AGREEMENT; PROVIDED THAT SUCH
AGREEMENT MAY PROVIDE THAT SUCH LENDER WILL NOT, WITHOUT THE CONSENT OF THE
PARTICIPANT, AGREE TO ANY AMENDMENT, MODIFICATION OR WAIVER THAT (1) REQUIRES
THE CONSENT OF EACH LENDER DIRECTLY AFFECTED THEREBY PURSUANT TO THE PROVISO TO
THE SECOND SENTENCE OF SECTION 11.1 AND (2) DIRECTLY AFFECTS SUCH PARTICIPANT. 
SUBJECT TO PARAGRAPH (C)(II) OF THIS SECTION, THE BORROWER AGREES THAT EACH
PARTICIPANT SHALL BE ENTITLED TO THE BENEFITS OF SECTIONS 4.9, 4.10 AND 4.11 TO
THE SAME EXTENT AS IF IT WERE A LENDER AND HAD ACQUIRED ITS INTEREST BY
ASSIGNMENT PURSUANT TO PARAGRAPH (B) OF THIS SECTION.  TO THE EXTENT PERMITTED
BY LAW, EACH PARTICIPANT ALSO SHALL BE ENTITLED TO THE BENEFITS OF
SECTION 10.14(B) AS THOUGH IT WERE A LENDER, PROVIDED SUCH PARTICIPANT SHALL BE
SUBJECT TO SECTION 10.14(B) AS THOUGH IT WERE A LENDER.

 

(II)           A PARTICIPANT SHALL NOT BE ENTITLED TO RECEIVE ANY GREATER
PAYMENT UNDER SECTION 4.9 OR 4.10 THAN THE APPLICABLE LENDER WOULD HAVE BEEN
ENTITLED TO RECEIVE WITH RESPECT TO THE PARTICIPATION SOLD TO SUCH PARTICIPANT,
UNLESS THE SALE OF THE PARTICIPATION TO SUCH PARTICIPANT IS MADE WITH THE
BORROWER’S PRIOR WRITTEN CONSENT.  ANY PARTICIPANT THAT IS A NON-U.S. LENDER
SHALL NOT BE ENTITLED TO THE BENEFITS OF SECTION 4.10 UNLESS SUCH PARTICIPANT
COMPLIES WITH SECTIONS 4.10(D) AND 4.10(E).

 

(D) ANY LENDER MAY AT ANY TIME PLEDGE OR ASSIGN A SECURITY INTEREST IN ALL OR
ANY PORTION OF ITS RIGHTS UNDER THIS AGREEMENT TO SECURE OBLIGATIONS OF SUCH
LENDER, INCLUDING ANY PLEDGE OR ASSIGNMENT TO SECURE OBLIGATIONS TO A FEDERAL
RESERVE BANK, AND THIS SECTION SHALL NOT APPLY TO ANY SUCH PLEDGE OR ASSIGNMENT
OF A SECURITY INTEREST; PROVIDED THAT NO SUCH PLEDGE OR ASSIGNMENT OF A SECURITY
INTEREST SHALL RELEASE A LENDER FROM ANY OF ITS OBLIGATIONS HEREUNDER OR
SUBSTITUTE ANY SUCH PLEDGEE OR ASSIGNEE FOR SUCH LENDER AS A PARTY HERETO.

 

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(E) THE BORROWER, UPON RECEIPT OF WRITTEN NOTICE FROM THE RELEVANT LENDER,
AGREES TO ISSUE NOTES TO ANY LENDER REQUIRING NOTES TO FACILITATE TRANSACTIONS
OF THE TYPE DESCRIBED IN PARAGRAPH (D) ABOVE.

 

(F) NOTWITHSTANDING THE FOREGOING, ANY CONDUIT LENDER MAY ASSIGN ANY OR ALL OF
THE TERM LOANS IT MAY HAVE FUNDED HEREUNDER TO ITS DESIGNATING LENDER WITHOUT
THE CONSENT OF THE BORROWER OR THE ADMINISTRATIVE AGENT AND WITHOUT REGARD TO
THE LIMITATIONS SET FORTH IN SECTION 11.6(B).  EACH OF THE BORROWER, EACH LENDER
AND THE ADMINISTRATIVE AGENT HEREBY CONFIRMS THAT IT WILL NOT INSTITUTE AGAINST
A CONDUIT LENDER OR JOIN ANY OTHER PERSON IN INSTITUTING AGAINST A CONDUIT
LENDER ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION
PROCEEDING UNDER ANY STATE BANKRUPTCY OR SIMILAR LAW, FOR ONE YEAR AND ONE DAY
AFTER THE PAYMENT IN FULL OF THE LATEST MATURING COMMERCIAL PAPER NOTE ISSUED BY
SUCH CONDUIT LENDER; PROVIDED, HOWEVER, THAT EACH LENDER DESIGNATING ANY CONDUIT
LENDER HEREBY AGREES TO INDEMNIFY, SAVE AND HOLD HARMLESS EACH OTHER PARTY
HERETO FOR ANY LOSS, COST, DAMAGE OR EXPENSE ARISING OUT OF ITS INABILITY TO
INSTITUTE SUCH A PROCEEDING AGAINST SUCH CONDUIT LENDER DURING SUCH PERIOD OF
FORBEARANCE.

 

11.7.        Adjustments; Set-off.  (a)  Except to the extent that this
Agreement expressly provides for payments to be allocated to a particular Lender
or to the Lenders under a particular Facility, if any Lender (a “Benefitted
Lender”) shall receive any payment of all or part of the Obligations owing to it
under the Loan Documents, or receive any collateral in respect thereof (whether
voluntarily or involuntarily, by set-off, pursuant to events or proceedings of
the nature referred to in Section 9(f), or otherwise), in a greater proportion
than any such payment to or collateral received by any other Lender, if any, in
respect of the Obligations under the Loan Documents owing to such other Lender,
such Benefitted Lender shall purchase for cash from the other Lenders a
participating interest in such portion of the Obligations under the Loan
Documents owing to each such other Lender, or shall provide such other Lenders
with the benefits of any such collateral, as shall be necessary to cause such
Benefitted Lender to share the excess payment or benefits of such collateral
ratably with each of the Lenders; provided, however, that if all or any portion
of such excess payment or benefits is thereafter recovered from such Benefitted
Lender, such purchase shall be rescinded, and the purchase price and benefits
returned, to the extent of such recovery, but without interest.

 

(B) IN ADDITION TO ANY RIGHTS AND REMEDIES OF THE LENDERS PROVIDED BY LAW, EACH
LENDER SHALL HAVE THE RIGHT, WITHOUT PRIOR NOTICE TO THE BORROWER, ANY SUCH
NOTICE BEING EXPRESSLY WAIVED BY THE BORROWER TO THE EXTENT PERMITTED BY
APPLICABLE LAW, UPON THE OCCURRENCE AND DURING THE CONTINUANCE OF AN EVENT OF
DEFAULT UNDER SECTION 9(A) HEREOF, TO SET OFF AND APPROPRIATE AND APPLY AGAINST
SUCH AMOUNT ANY AND ALL DEPOSITS (GENERAL OR SPECIAL, TIME OR DEMAND,
PROVISIONAL OR FINAL), IN ANY CURRENCY, AND ANY OTHER CREDITS, INDEBTEDNESS OR
CLAIMS, IN ANY CURRENCY, IN EACH CASE WHETHER DIRECT OR INDIRECT, ABSOLUTE OR
CONTINGENT, MATURED OR UNMATURED, AT ANY TIME HELD OR OWING BY SUCH LENDER OR
ANY BRANCH OR AGENCY THEREOF TO OR FOR THE CREDIT OR THE ACCOUNT OF THE
BORROWER, AS THE CASE MAY BE.  EACH LENDER AGREES PROMPTLY TO NOTIFY THE
BORROWER AND THE ADMINISTRATIVE AGENT AFTER ANY SUCH SETOFF AND APPLICATION MADE
BY SUCH LENDER, PROVIDED THAT THE FAILURE TO GIVE SUCH NOTICE SHALL NOT AFFECT
THE VALIDITY OF SUCH SETOFF AND APPLICATION.

 

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11.8.        Counterparts.  This Agreement may be executed by one or more of the
parties to this Agreement on any number of separate counterparts, and all of
said counterparts taken together shall be deemed to constitute one and the same
instrument.  Delivery of an executed signature page of this Agreement by
facsimile transmission shall be effective as delivery of a manually executed
counterpart hereof.  A set of copies of this Agreement signed by all the parties
shall be lodged with the Borrower and the Administrative Agent.

 

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

 

11.10.      Integration; Intercreditor and Subordination Agreements.  This
Agreement, together with the other Loan Documents, reflects the entire
understanding of the parties with respect to the transactions contemplated
hereby and shall not be contradicted or qualified by any other agreement, oral
or written, before the date hereof.  Each Lender hereby authorizes and directs
the Administrative Agent to enter into the Intercreditor Agreement and
Subordination Agreement on its behalf and hereby approves and agrees to be bound
by the terms of the Intercreditor Agreement and the Subordination Agreement. 
Notwithstanding anything to the contrary herein, in the case of any
inconsistency between this Agreement and the Intercreditor Agreement, the
Intercreditor Agreement shall govern.

 

11.11.      GOVERNING LAW.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

11.12.      Submission To Jurisdiction; Waivers.  The Borrower hereby
irrevocably and unconditionally:

 

(A) SUBMITS FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION OR PROCEEDING
RELATING TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS TO WHICH IT IS A PARTY,
OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT THEREOF, TO THE
NON-EXCLUSIVE GENERAL JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK
LOCATED IN THE CITY OR COUNTY OF NEW YORK, THE COURTS OF THE UNITED STATES FOR
THE SOUTHERN DISTRICT OF NEW YORK, AND APPELLATE COURTS FROM ANY THEREOF;

 

(B) CONSENTS THAT ANY SUCH ACTION OR PROCEEDING MAY BE BROUGHT IN SUCH COURTS
AND WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY
SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR PROCEEDING
WAS BROUGHT IN AN INCONVENIENT COURT AND AGREES NOT TO PLEAD OR CLAIM THE SAME;

 

(C) AGREES THAT SERVICE OF PROCESS IN ANY SUCH ACTION OR PROCEEDING MAY BE
EFFECTED BY MAILING A COPY THEREOF BY REGISTERED OR CERTIFIED MAIL (OR ANY
SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO THE BORROWER AT ITS
ADDRESS SET FORTH IN

 

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SECTION 11.2 OR AT SUCH OTHER ADDRESS OF WHICH THE ADMINISTRATIVE AGENT SHALL
HAVE BEEN NOTIFIED PURSUANT THERETO;

 

(D) AGREES THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT TO SUE IN
ANY OTHER JURISDICTION; AND

 

(E) WAIVES, TO THE MAXIMUM EXTENT NOT PROHIBITED BY LAW, ANY RIGHT IT MAY HAVE
TO CLAIM OR RECOVER IN ANY LEGAL ACTION OR PROCEEDING REFERRED TO IN THIS
SECTION ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES.

 

11.13.      Acknowledgments.  The Borrower hereby acknowledges that:

 

(A) IT HAS BEEN ADVISED BY COUNSEL IN THE NEGOTIATION, EXECUTION AND DELIVERY OF
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS;

 

(B) NO AGENT OR LENDER HAS ANY FIDUCIARY RELATIONSHIP WITH OR DUTY TO THE
BORROWER ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER
LOAN DOCUMENTS, AND THE RELATIONSHIP BETWEEN THE AGENTS AND LENDERS, ON ONE
HAND, AND THE BORROWER, ON THE OTHER HAND, IN CONNECTION HEREWITH OR THEREWITH
IS SOLELY THAT OF DEBTOR AND CREDITOR; AND

 

(C) NO JOINT VENTURE IS CREATED HEREBY OR BY THE OTHER LOAN DOCUMENTS OR
OTHERWISE EXISTS BY VIRTUE OF THE TRANSACTIONS CONTEMPLATED HEREBY AMONG THE
LENDERS OR AMONG THE BORROWER AND THE LENDERS.

 

11.14.      Releases of Guarantees and Liens.  (a)  Notwithstanding anything to
the contrary contained herein or in any other Loan Document, the Administrative
Agent is hereby irrevocably authorized by each Lender (without requirement of
notice to or consent of any Lender except as expressly required by Section 11.1)
to take any action requested by the Borrower having the effect of releasing any
Collateral or guarantee obligations (i) to the extent necessary to permit
consummation of any transaction not prohibited by any Loan Document or that has
been consented to in accordance with Section 11.1 or (ii) under the
circumstances described in paragraph (b) below.

 

(B) AT SUCH TIME AS THE TERM LOANS AND THE OTHER SECOND LIEN OBLIGATIONS UNDER
THE LOAN DOCUMENTS (OTHER THAN SECOND LIEN OBLIGATIONS UNDER OR IN RESPECT OF
SPECIFIED HEDGE AGREEMENTS OR SPECIFIED CASH MANAGEMENT AGREEMENTS AND
UNASSERTED CONTINGENT INDEMNIFICATION OBLIGATIONS) SHALL HAVE BEEN PAID IN FULL
AND THE TERM LOAN COMMITMENTS HAVE BEEN TERMINATED, THE COLLATERAL SHALL BE
RELEASED FROM THE LIENS CREATED BY THE SECURITY DOCUMENTS, AND THE SECURITY
DOCUMENTS AND ALL OBLIGATIONS (OTHER THAN THOSE EXPRESSLY STATED TO SURVIVE SUCH
TERMINATION) OF THE ADMINISTRATIVE AGENT AND EACH LOAN PARTY UNDER THE SECURITY
DOCUMENTS SHALL TERMINATE, ALL WITHOUT DELIVERY OF ANY INSTRUMENT OR PERFORMANCE
OF ANY ACT BY ANY PERSON, PROVIDED THAT, THE ADMINISTRATIVE AGENT AGREES UPON
SUCH TERMINATION TO PROMPTLY DELIVER TO THE BORROWER UCC-3 TERMINATION
STATEMENTS, DISCHARGES OF EXISTING MORTGAGES, AND OTHER RELEASE AND TERMINATION
DOCUMENTS AS ARE REASONABLY REQUESTED BY THE BORROWER TO DISCHARGE THE LIENS AS
A MATTER OF PUBLIC RECORD.

 

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11.15.      Confidentiality.  Each Agent and each Lender agrees to keep
confidential all non-public information provided to it by any Loan Party
pursuant to this Agreement; provided that nothing herein shall prevent any Agent
or any Lender from disclosing any such information (a) to any Agent, any other
Lender or any Lender Affiliate, (b) subject to an agreement to comply with the
provisions of this Section, to any actual or prospective Transferee or any
direct or indirect counterparty to any Hedge Agreement (or any professional
advisor to such counterparty), (c) to its employees, directors, agents,
attorneys, accountants and other professional advisors or those of any of its
affiliates (it being understood that the persons to whom such disclosure is made
will be informed of the confidential nature of such information and such Agent
or such Lender, as the case may be, shall be responsible for the compliance of
such person with this Section), (d) upon the request or demand of any
Governmental Authority, (e) in response to any order of any court or other
Governmental Authority or as may otherwise be required pursuant to any
Requirement of Law, (f) if requested or required to do so in connection with any
litigation or similar proceeding, (g) that has been publicly disclosed (other
than as a result of prohibited disclosure by the Agents or the Lenders), (h) to
the National Association of Insurance Commissioners or any similar organization
or any nationally recognized rating agency that requires access to information
about a Lender’s investment portfolio in connection with ratings issued with
respect to such Lender, or (i) in connection with the exercise of any remedy
hereunder or under any other Loan Document.  Each Agent and each Lender agrees
that in the event such Agent or such Lender is requested or required to disclose
such information pursuant to clauses (d), (e) or (f) above, such Agent or such
Lender, as the case may be, shall, to the extent practicable, provide the
Borrower with notice of any such request or requirement.

 

11.16.      Revival and Reinstatement of Obligations.  If the incurrence or
payment of the Obligations by the Borrower under the Loan Documents or the
transfer to the Lenders of any property should for any reason subsequently be
declared to be void or voidable under any sate or federal law relating to
creditors’ rights, including provisions of the Bankruptcy Code relating to
fraudulent conveyances, preferences, or other voidable or recoverable payments
of money or transfers of property (collectively, a “Voidable Transfer”), and if
the Lenders are required to repay or restore, in whole or in part, any such
Voidable Transfer, or elects to do so upon the reasonable advice of their
respective counsel, then, as to any Voidable Transfer, or the amount thereof
that the Lenders are required or elect to repay or restore, and as to all
reasonable costs, expenses and attorneys fees of the lenders related thereto,
the liability of the Borrower automatically shall be revived, reinstated, and
restored and shall exist as though such Voidable Transfer had never been made.

 

11.17.      WAIVERS OF JURY TRIAL.  THE BORROWER, THE AGENTS AND THE LENDERS
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION
OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY
COUNTERCLAIM THEREIN.

 

11.18.      Delivery of Addenda.  Each initial Lender shall become a party to
this Agreement by delivering to the Administrative Agent an Addendum duly
executed by such Lender.

 

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

 

 

NEW WORLD RESTAURANT GROUP, INC.

 

 

 

 

 

By:

/s/ Paul J.B. Murphy, III

 

 

 

Name:

Paul J.B. Murphy, III

 

 

Title:

President and Chief Executive Officer

 

 

 

 

BEAR, STEARNS & CO. INC., as Sole Lead
Arranger and Sole Bookrunner

 

 

 

 

 

By:

/s/ Bram Smith

 

 

 

Name:

Bram Smith

 

 

Title:

Senior Managing Director

 

 

 

 

 

BEAR STEARNS CORPORATE LENDING INC.,
as Administrative Agent

 

 

 

 

 

By:

/s/ Bram Smith

 

 

 

Name:

Bram Smith

 

 

Title:

Vice President

 

 

[Signature Page to Second Lien Credit Agreement]

 

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